Consequential damages weren’t contemplated when a homeowner executed a contract with a builder to reroof a residence. While work was being performed a storm occurred and caused water damage to the attic. The homeowner sued the builder, and after discovery was completed, it sought additional damages from “project delays and the increase in mortgage interest rates, material and construction costs,” etc. The builder filed a motion to preclude evidence showing these “consequential damages”. The court granted the motion, and this was affirmed on appeal because the courts concluded that consequential damages were not contemplated by the parties when the contract was executed. New York law holds that “In an action seeking damages for breach of contract, a party’s recovery is ordinarily limited to general damages which are the natural and probable consequence of the breach”. James Vermillion v. The Roofing Guys, Inc., 374 CA 24-00258 – Supreme Ct. of NY, App.Div., 4th Judicial Dept. (2025).
In further explanation for its short decision the court stated:
“To determine whether consequential damages were reasonably
contemplated by the parties, courts must look to the nature, purpose
and particular circumstances of the contract known by the parties
. . . as well as what liability the defendant fairly may be supposed
to have assumed consciously, or to have warranted the plaintiff
reasonably to suppose that it assumed, when the contract was made”
(citations omitted). Here, plaintiff entered into a “bare bones” contract with
defendant to tear off the roof of the residence, replace all rotted
plywood, re-lay architectural shingles, and remove all roofing debris.
Inasmuch as the contract makes no mention of consequential damages and
contains nothing that could be interpreted as contemplating
consequential damages, and no party testified that consequential
damages were contemplated when the contract was entered, the court
properly precluded testimony or proof of consequential damages.”
About the author: Article written by J. Kent Holland, Jr., a construction lawyer located in Tysons Corner, Virginia, with a national practice (formerly with Wickwire Gavin, P.C. and now with ConstructionRisk Counsel, PLLC) representing design professionals, contractors and project owners. He is founder and president of a consulting firm, ConstructionRisk, LLC, providing consulting services to owners, design professionals, contractors and attorneys on construction projects. He is publisher of ConstructionRisk Report and may be reached at Kent@ConstructionRisk.com or by calling 703-623-1932. This article is published in ConstructionRisk Report, Vol. 27, No. 5 (July 2025).
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