› Assessment of rectification damages where no rectification undertaken
Contract
› Payment Terms
› Final payment not due where works incomplete — quantum meruit recovery
Damages
› Measure of Damages
› Reasonableness of rectification costs — Bellgrove v Eldridge qualification
Quick Take
1Where a contractor's contractual right to a final progress payment has not accrued because works are incomplete, the contractor is nonetheless entitled to recover the value of work actually performed on a quantum meruit basis, following Mann v Paterson Constructions Pty Ltd.
2Rectification damages for defective commercial fit-out works will not be awarded where the defects had no functional impact on the business, the business has since been sold without rectification, the works will never be rectified, and the cost of rectification would be wholly disproportionate to the actual loss suffered — applying Bellgrove v Eldridge, Tabcorp, and Ruxley.
3Where a contractor initially agrees to perform additional work at no charge, it cannot unilaterally decide to invoice for that work after a payment dispute arises.
