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History of the facts pertaining to the case
In the case of Erlich v. Menezes, Barry and Sandra Erlich sued John Menezes, a general contractor for poor construction of their house. The two had entered into a contract with Menezes to have him build their dream home which later turned out to have major defects. Since the general contractor was licensed, they dealt with him in the belief that his work would be good.
Two months after moving into the new house, rains started and water would leak from the walls and windows. The plasters on the ceiling were saturated and when they could not hold more water, chunks of sand started falling off. The floor of the living room had several inches of standing water.
There were attempts to place caulking around the windows to minimize the leakage but this only worsened the situation as they melted and went on to stain the windows.
The house was later inspected by a different contractor whom confirmed that there were major construction defects. This proved that Menezes had been negligent in the course of his duty and had breached his contact with the home owners (Meiners, Ringleb, and Edwards 275).
The plaintiffs suffered both financial loss and emotional distress. Consequently, they sort compensation on the basis of negligent misrepresentation, negligent performance of duty, fraud and breach of contract. Due to the financial loss they suffered, the jury ruled that the plaintiffs be awarded $ 406,700 to cater for the repairs.
Barry Erlich had resigned from his place of employment since he was no longer in a position to effectively perform his duties and was awarded $ 15,000 for the earnings lost. He also received an additional $50,000 for suffering physical pain because of a heart condition that was aggravated by excessive stress.
Each of the affected parties had suffered some kind of emotional distress because of the condition of the house. Sandra feared that the house would collapse in case there was an earthquake. For this reason, each of them received $50,000.
The dissent was however opposed to the idea of awarding compensation with regard to emotional distress because the contractor’s negligence only caused direct damage to property and financial loss. The Supreme Court however reversed and remanded claiming that emotional distress damages could not be compensated (Meiners, Ringleb, and Edwards 275).
The case of Erlich v Menezes had major economic implications to the plaintiffs which should have economically affected its outcome. Barry Erlich developed a heart condition which meant that some of their resources would be spent taking care of his medical expenses. Their income would therefore be affected either by directly taking care of the medical bills or by an increase in the health insurance premiums.
He also had to resign from his employment and therefore the loss of income would adversely affect the family’s living standards. It was uncertain for how long he would be out of employment therefore; the amount of financial loss could not be quantified. When the family realized that their house had major defects, they spent money on repairs. Such finances would have been spent on other important family needs.
Diversion of their income to cater for repairs of a house they had already spent money constructing was an inconvenience. The plaintiffs had to consult a different general contractor after their efforts to repair the house failed. This was an additional expense that would have been avoided by Menezes had he been more careful in the performance of his duty.
There were legal costs incurred by the plaintiffs when they decided to file a law suit against the defendant. The time spent on repairs and on the case would have been spent in income generating activities by the plaintiffs. Due to the time value of money, there was a possibility that the cost of building materials had appreciated between the time when the house was first constructed and the time when repairs were being done.
When a person is under mental stress, it is very likely that they are not able to effectively perform their duties and even through Sandra did not lose her job; there was a possibility of the stress affecting her performance. It was therefore necessary for the plaintiffs to be compensated for the economic risk they were placed in by the state of their house.
They should have received monetary compensation not only for the demolition and repair of their house but also for other indirect economic injury. This would include enough compensation for loss of income as well as any medical expenditure that would be incurred by the plaintiff. Emotional injury should also have been catered for in terms of the loss in income caused by poor performance due to stress.
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I do not agree with the ruling. Besides suffering financial loss, the plaintiffs also suffered emotional distress and it was their right to be compensated for such distress. The extent of the emotional discomfort was so bad that Barry became ill and lost his job due to stress.
The family was living in deplorable conditions due to the decisions made by the contractor. It was therefore only fair that they be compensated for both the distress and the amount they would require to repair their house.
The contractor owed his clients duty of care and by constructing a defective house for them, he breached this duty. The plaintiffs were therefore eligible for compensation under tort. There was also an intentional tort because the contractor should have foreseen the emotional distress caused to his clients when constructing a building that did not meet the standards.
By consulting a licensed general contractor, the Erlichs trusted him to be aware of his duties and be able to effectively execute them. Because the contractor would offer similar services to other clients, it would be important for punitive damages to be awarded as this would lower the risk of such an occurrence in future.
Liquidated damages should also have been awarded. In this case because the amount of liquidated damages had not been predetermined, it was the duty of the court to come up with a figure for such damages. Incidental damages would have been awarded to the plaintiffs for the incident that occurred after they moved into their new home.
This is because there were extra expenses that would be suffered by the plaintiff as they attempted to repair their home. The above mentioned tort damages were applicable because there were both breach of good faith and physical injury to one of the plaintiffs.
Meiners, Roger, Al Ringleb and Frances Edwards. The legal environment of business. New York: Cengage Learning, 2006.print