[CLC-Discussion] proper measure of damages in professional negligence action when only option is complete tear-down of structure

[Justin Zinzow]

Good afternoon:  I write to inquire if any among us has located and applied legal authorities on the proper measure of damages in a professional negligence action where the structure is not legally useable in any form.  Specifically, is the owner limited to diminution in value of the property only, or are consequential damages also recoverable? If the damages are limited to diminution in value, how is diminution calculated when the "improvements" to the property are worthless (the structure is an uncurable code violation because it is built below the benchmark flood elevation and cannot be elevated without the old structure being destroyed in the process) and actually creating ongoing liability to the owner in the form of code enforcement penalties for as long as the structure remains standing?

Grossman Holdings, Ltd. v. Hourihan, 414 So. 2d 1037 (Fla. 1982) seems to be premised on a breach of contract action, not one sounding in negligence.  It relies upon section 346 of the Restatement (First) of Contracts.  Grossman also appears to apply only when there would be unreasonable economic waste.  To the extent a tear down and rebuild is "waste," it does not seem unreasonable under the circumstances, which include active code enforcement prosecution by the county for being below the benchmark.

Similarly, Heine v. Parent Construction, Inc., 4 So. 3d 790 (Fla. 4th DCA 2009) (a case in which a house was built a foot lower than contracted for), seems distinguishable because it is a contract case rather than a tort case and it does not involve FEMA/building code violations.

However, there are tort cases limiting damages to diminution in value if cost of repairs or restoration exceeds the diminution in value: Davey Compressor Co. v. City of Delray Beach, 639 So. 2d 595 (Fla. 1994) (actually decided on an exception to the general rule but in dicta mentions the general rule and cites Keyes Co. v. Shea, 372 So. 2d 493, for the general rule); Bisque Assoc. v. Towers of Quayside No. 2 Cond. Assn., 639 So. 2d 997 (Fla. 3d DCA 1994); and Santa Rosa Golf Assocs. v. Haraway, 998 So. 2d 1166 (Fla. 1st DCA 2008).

The Florida Standard Jury Instructions - Civil Cases, seem partially instructive.  Although Section 402 applies to professional negligence, it does not have an instruction for damages for professional negligence. Section 409.9 addresses claims for false information negligently supplied for the guidance of others, and Section 409.13 describes the damages available, citing to the Restatement (Second) of Torts, section 552B.  The diminution in damages limitation is not stated in 409.13, and consequential damages are available under 552B, subsection (1)(b).

Any insights are most appreciated.



Justin R. Zinzow
Admitted to Practice Florida & Texas
AV Preeminent(r) Rated Attorney
Fla. Board Certified in Construction Law

P: (727) 787-3121
F: (727) 375-5593
8750 Hawbuck Street
Trinity, Florida 34655
www.zinzowlaw.com

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