Farley v Skinner [2001] UKHL 49

Facts

• Mr. Farley engaged Mr. Skinner, a surveyor, to inspect a property he was considering purchasing.
• A specific instruction was given to investigate whether the property was affected by aircraft noise, as Mr. Farley wished to avoid residing near a flight path.
• Mr. Skinner reported that the property was unlikely to be affected by such noise.
• Relying on this report, Mr. Farley purchased the property but later discovered it was significantly impacted by aircraft noise.
• Mr. Farley brought a breach of contract claim, alleging substandard performance and breach of the contractual obligation to exercise reasonable care over the investigation of aircraft noise.
• He sought compensation not only for financial loss but also for diminished enjoyment and distress caused by the aircraft noise.

Issues

1. Whether damages for non-pecuniary loss, specifically distress and physical inconvenience, can be awarded for breach of contract in this context.
2. Whether a contract whose object is not solely pleasure may still support a claim for damages for distress or inconvenience if freedom from discomfort is a major or important object.
3. Whether the experience of aircraft noise amounted to physical inconvenience warranting recovery of damages for distress.

Decision

• The House of Lords unanimously found in favour of Mr. Farley, awarding £10,000 in damages for discomfort.
• Lord Steyn clarified that the "very object" of a contract need not be narrowly interpreted; it suffices if freedom from discomfort is a major or important object of the contract.
• The Court held that the provision of a quiet house was an important aspect of the contract, justifying a claim.
• Lord Scott stated that the distinction between physical and non-physical inconvenience depends on the cause; discomfort arising from sensory experiences could be compensable.
• The Court concluded that aircraft noise constituted physical inconvenience, supporting a damages award for distress.
• The scope for recovery of non-pecuniary loss in contract law was broadened.

Legal Principles

• Damages in contract law aim to place the claimant in the position as if the contract had been properly performed (Robinson v Harman).
• Damages for mental distress are not generally recoverable except where the contract’s object is pleasure, relaxation, or freedom from discomfort.
• The interpretation of "very object" can include any major or important objective such as freedom from nuisance.
• Physical inconvenience for the purpose of damages includes negative sensory experiences (such as noise).
• Contracts can give rise to claims for non-pecuniary loss if the breach causes tangible harm, provided losses are not too remote.

Conclusion

Farley v Skinner [2001] UKHL 49 is a leading authority establishing that damages for distress or inconvenience may be awarded where freedom from such discomfort is a major purpose of the contract, and that physical inconvenience encompasses negative sensory experiences, expanding the scope for compensatory remedies in English contract law.