Monday 24 March 2025
Your weekly SQE Prep Quiz has arrived
Dear Subscriber,
I hope you had a great weekend! Please see below for the question, the answer to the previous question and associated resources. This is the web version of this newsletter.
Question: Harry enters into a contract with Premium Builders Ltd. to construct a bespoke conservatory at his home for £30,000. The completed conservatory, however, does not meet the agreed specifications. The roof is constructed from cheaper materials, and the dimensions are smaller than those stipulated in the contract. To rebuild the conservatory properly would cost Harry an additional £15,000. However, an independent valuation indicates that the value of Harry’s property has only decreased by £5,000 due to the builder’s errors.
Harry wants advice on the measure of damages he can claim to compensate him for the breach of contract. Which of the following correctly describes the difference between “cost of cure” and “difference in value” as measures of expectation loss in damages?
1. The “cost of cure” measure provides damages based on the cost of correcting the defects to meet contractual specifications, whereas the “difference in value” measure compensates for the actual decrease in the property’s market value due to the defects.
2. The “difference in value” measure always provides higher compensation than the “cost of cure,” as it factors in subjective disappointment and inconvenience.
3. The “cost of cure” measure always limits compensation to the loss in the property’s market value, whereas the “difference in value” measure compensates fully for any additional expenses needed to rectify the breach.
4. Both measures are identical in law; courts always award damages based on the property’s decrease in market value alone.
5. The “difference in value” measure exclusively considers the cost required to rebuild or correct defects, ignoring the property’s market value entirely.
Resource: Learn more about damages for breach of contract by watching this video. Pick up a copy of our free study planner here.
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Answer and feedback to last week’s question: Julia operates a small catering business and enters into a contract with FreshFarm Ltd. to supply fresh produce weekly. FreshFarm Ltd. repeatedly fails to deliver goods as agreed, causing Julia to lose customers and profits totalling £8,000. Julia decides to bring a claim for breach of contract in court to recover her losses. She seeks legal advice on the appropriate court and procedural track that will handle her case. Under the Civil Procedure Rules (CPR), which court and track are most likely appropriate for Julia’s claim?
1. County Court, Small Claims Track – Because Julia’s claim is less than £10,000 and involves a straightforward contractual dispute.
2. High Court, Multi-track – Because the dispute involves a business-to-business contract dispute.
3. County Court, Fast Track – Because Julia’s claim exceeds £5,000 and is a business dispute, requiring formal procedures and expert evidence.
4. Magistrates’ Court, Small Claims Track – Because the claim is small and straightforward.
5. High Court, Fast Track – Because contractual disputes involving commercial businesses must always be heard in the High Court.
Correct Answer: 1. County Court, Small Claims Track – Because Julia’s claim is less than £10,000 and involves a straightforward contractual dispute. Under the Civil Procedure Rules (CPR), civil claims are allocated to different tracks and courts based on the value and complexity of the claim:
1. Small Claims Track (Claims up to £10,000)
Typically handled in the County Court.
Designed for straightforward, lower-value cases, often consumer or simple contractual disputes.
Less formal procedures; parties often represent themselves.
Julia’s claim is for £8,000, making it appropriate for the Small Claims Track in the County Court, as the dispute is straightforward and involves no complex legal or factual issues.
2. Fast Track (Claims between £10,000 and £25,000)
Formal but streamlined procedures with limited hearings, typically concluded within one day.
3. Multi-track (Complex claims or over £25,000)
For high-value or complex matters needing detailed management by a judge.
Why the Other Options Are Incorrect:
Option 2 (High Court, Multi-track) is incorrect because Julia’s claim is below the High Court’s financial threshold and not complex enough for multi-track.
Option 3 (County Court, Fast Track) is incorrect because Julia’s claim is below £10,000, placing it in the Small Claims Track, not the Fast Track.
Option 4 (Magistrates’ Court, Small Claims Track) is incorrect because the Magistrates’ Court handles criminal and certain specific civil matters—not straightforward civil contract disputes.
Option 5 (High Court, Fast Track) is incorrect because contractual disputes of modest value do not require High Court jurisdiction. High Court generally handles high-value, complex disputes.
Julia’s claim of £8,000 fits squarely within the Small Claims Track in the County Court, which is designed specifically for claims of this value and simplicity.
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Dr Ioannis Glinavos
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