Allhomes Contracts with Baker Contractors for the Construction of 75

question 4

Multiple Choice

Allhomes contracts with Baker Contractors for the construction of 75 housing units for £17 million. The contract specifies that Baker must use foam insulation for the hot water pipes. Instead, Baker uses foil-faced fiberglass insulation as he usually does. Replacing the insulation would entail demolishing all inner walls of the constructed house, costing £11 million. The two types of insulation are equal in value and are identical for all practical purposes. What damages can Betterhomes claim for the breach?

• A) The cost of cure, being the cost of replacing the insulation (£11 million).
• B) The diminution of value (nominal).
• C) The loss of amenities (a just sum determined by the courts).

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