Initial Agreement: Tega Homes and Spencedale entered into an agreement for the development of two properties into a residential condominium.
Breach of Contract: Spencedale breached the agreement by refusing to complete the sale, leading to a lawsuit by Tega Homes for damages incurred due to the breach.
Trial and Appeal:
Lower Court Ruling: The trial court awarded damages to Tega Homes, including the increased value of the properties and 90% of the development expenses Tega Homes incurred.
Appeal: Spencedale appealed, challenging the calculation of damages, particularly the inclusion of development expenses incurred from 2010 and rental amounts for unrelated projects.
Court of Appeal's Findings:
Overcompensation: The appellate court found that the trial judge did not overcompensate Tega Homes since both the property value increase and the development expenses were legitimate damages.
Development Expenses: The appellate court ruled that the trial judge erred by awarding expenses from 2010 since these were covered under a different agreement (JVA) which ended with a release of claims, unrelated to the breached 2013 sale agreement.
Rental Expenses: The appellate court determined that rental costs for a sales office should not be included as recoverable development expenses if they related to an unrelated project.
Result:
Partial Allowance of Appeal: The appellate court allowed the appeal in part, reducing the damages awarded by excluding certain development and rental expenses.
Adjustment of Damages: Further calculations were required to adjust the awarded damages accurately.
