An architect who provides a cost estimate for a building project must have reasonable grounds for that estimate, assessed by reference to the nature and standard of the project as discussed with the client. A rate per square metre selected below the published range for the relevant category of building, justified only by unsupported assumptions about trade discounts, will not constitute reasonable grounds. Where a plaintiff establishes that but for a negligent cost estimate they would have taken an alternative course of action (such as engaging a project home builder), reliance loss measured as the lost profit from that alternative course is recoverable.
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