Bailment Cases: When a negligent bailment results in injury to property, the measure of damages is the difference in the value of the property before and after the injury plus any consequential damages, less any proper storage charges.107 If the injury to the bailed property is caused by a third party, a bailee without fault is only liable to the bailor for the surplus recovered by the bailor from that third party after deducting all proper costs and charges in connection with the bailment.108 When a bailee places the property in the custody of a succeeding bailee and the property is damaged while in the custody of that succeeding bailee, the original bailee is liable for the difference between the value of the property before it came into the custody of the succeeding bailee and when it was returned to the bailor.109
Common Carrier Cases: If property is damaged while in transit by a common carrier, the measure of damages is the difference in the value of the property before and after the injury.110 If the common carrier fails to deliver the property, the measure of damages is the market value of the property at the time and place at which the delivery should have been made.111
Construction Defect Cases: Whether sounding in contract or tort, the measure of damages for injury to property resulting from a construction defect is the cost of repair unless it is not reasonable or practicable to do so. If there is a tremendous disparity between the cost of restoration and the diminution in the value of the property as a result of the construction defect, the latter may be an appropriate measure of value.112 Courts, however, may diverge from a strict application of this formula to achieve a just and reasonable result. In particular, courts may permit a factfinder to consider a substitute remedy which will produce a result similar in value to the result for which the aggrieved party contracted.112.1
Eminent Domain: Delaware’s Constitution provides that “nor shall any man’s property be taken or applied into public use without the consent of his representatives, and without compensation being made.”113 The measure of compensation to be awarded a landowner for a taking of his or her property is the fair market value of the property, i.e., a figure representing the price that would be agreed upon by a willing buyer and a willing seller under usual and ordinary circumstances, without any compulsion whatsoever upon the seller to sell or upon the buyer to buy, considering all available uses for the property.114 Possible methods for determining the fair market value include the capitalization of income approach and the comparative sales approach.115 When the land taken has been devoted to a unique use such as a church or a school, for which there is no ready market, evidence of the cost of reproduction, less depreciation, may be received and added to the value of the land itself to determine fair market value.116 Any valuation method, however, may not take into account such factors as value peculiarly personal to the owner, the fact that the owner did not wish to be deprived of the property or the value to the government or its need for the property.117
When only a portion of a contiguous parcel of land is being taken by the condemning authority and the remainder of the parcel is left in the owner’s possession, compensation must be made for that portion of the property taken plus any damage to the value of the remainder that may result from the taking. Delaware applies a “before and after” methodology for determining fair market value in a partial taking case that looks at the difference between the market value of the parcel of land as a whole, immediately before and unaffected by the taking, and the market value of the remainder of the property which is not being taken, immediately after and as unaffected by the taking.118 In such a partial taking case, any special benefit to the value of the remaining property as a result of the taking may be offset against the injury.119 “Special benefits” are benefits that directly and proximately affect the property remaining after the partial taking. By contrast, “general benefits” are those which are incidental and shares by the public within the area of the taking. Special benefits, unlike general benefits, add to the convenience, accessibility, and use of the property resulting from physical changes to the owner’s remaining land or its proximity to the public project. Whether a given benefit is general or specific is determined largely by the facts and circumstances of each case.119.1
Insurance Broker Cases: A broker who has wrongfully failed to provide insurance according to his or her contract is, in the case of loss, liable to the insured for the amount which the insured would have received from the insurer had the coverage been placed.120 In the event of wrongful termination of insurance coverage without the intervening occurrence of a covered loss, the measure of damages would be simply the cost of obtaining replacement coverage.120.1
Medical Malpractice – Loss of Chance of Survival & Increased Risk: The loss of chance doctrine may allow a plaintiff to recover, to some extent, for the loss of a not better than even chance of a favorable outcome. If an injury is suffered in the loss of chance situation, it is the reduced possibility of survival which is the basis of the claim, not the death itself. Under the increased risk doctrine, a person may recover damages if the person’s risk of suffering a negative medical condition is increased because of medical malpractice. The increased risk doctrine is considerably broader than the loss of chance doctrine since the former appears to apply even if the plaintiff has a greater than 50 percent chance of survival prior to the malpractice. Moreover, the increased risk doctrine might apply to situations not involving death as the potential outcome.120.2
Nuisance: The measure of damages for a permanent nuisance is the diminution in the market value of the property. For a temporary nuisance, the measure of general damages is the diminution of use or rental value of the property. In addition, a plaintiff may recover special damages, as may be proved, for economic loss, discomfort and inconvenience in the use of the property and reasonable expenses in preventing future injury if such expenses do not exceed the diminution in value to the property that would otherwise result.121
107. Catalfano v. Higgins, 191 A.2d 330, 333 (Del. Super. 1963); Milford Packing Co. v. Isaacs, 90 A.2d 796, 798 (Del. Super. 1952).
108. Terry v. Pennsylvania R. Co., 156 A. 787, 789 (Del. Super. 1931).
109. Schagrin v. Bacon, 117 A. 741, 742 (Del. Super. 1922).
110. Hardesty v. American R. E. Co., 119 A. 681, 684 (Del. Super. 1922); Klair v. Philadelphia, B. & W. R. Co., 78 A. 1085, 1098 (Del. Super. 1910); Carpenter v. Baltimore & O. R. Co., 64 A. 252, 253 (Del. Super. 1906).
111. Hardesty v. American R. E. Co., 119 A. 681, 684 (Del. Super. 1922).
112. Council of Unit Owners of Sea Colony East, etc. v. Carl M. Freeman Associates, Inc., 564 A.2d 357, 361 (Del. Super. 1989); Shipman v. Hudson, C.A. No. 88C-JN32, slip op. at 10, Lee, J. (Del. Super. Feb. 17, 1995). See also Club Lane Ass’n v. Armstrong, C.A. No. 80C-JN-99, slip op. at 12, Walsh, J. (Del. Super. Apr. 20, 1983), aff’d mem., 482 A.2d 763 (Del. 1984).
112.1. Shipman v. Hudson, C.A. No. 88C-JN32, slip op. at 10, Lee, J. (Del. Super. Feb. 17, 1995).
113. Del. Const. art. I, § 8.
114. State ex rel. Secretary of Dept. of Highways & Transp. v. Davis Concrete of Delaware, Inc., 355 A.2d 883, 886 (Del. 1976); Wilmington Housing Authority v. Greater St. John Baptist Church, 291 A.2d 282, 284 (Del. 1972); State ex rel. State Highway Dept. v. J. H. Wilkerson & Son, Inc., 280 A.2d 700, 701 (Del. 1971); 9.88 Acres of Land v. State, 274 A.2d 139, 140 n.8 (Del. 1971); State ex tel. State Highway Dept. v. 9.88 Acres of Land, 253 A.2d 509, 510 (Del. 1969); 0.744 of An Acre of Land v. State, 251 A.2d 341, 342 (Del. 1969); 16.50, etc., Acres of Land, etc. v. State, 58 Del. 225, 208 A.2d 55, 59 (Del. 1965); State ex tel. Price v. 2.7089 Acres of Land, 256 A.2d 275, 278 (Del. Super. 1969); Board of Education v. 13 Acres of Land, 131 A.2d 180, 183 (Del. Super. 1957); Wilmington Housing Authority v. Harris, 93 A.2d 518, 521 (Del. Super. 1952); Thomison v. Hillcrest Athletic Ass’n, 5 A.2d 236, 238-39 (Del. Super. 1939).
115. Wilmington Housing Authority v. Greater St. John Baptist Church, 291 A.2d 282, 284 (Del. 1972).
116. Wilmington Housing Authority v. Greater St. John Baptist Church, 291 A.2d 282, 285 (Del. 1972); 0.744 of an Acre of Land v. State, 251 A.2d 341, 342 (Del. 1969).
117. State ex rel. Secretary of Dept. of Highways & Transp. v. Davis Concrete of Delaware, Inc., 355 A.2d 883, 886 (Del. 1976); Board of Education v. 13 Acres of Land, 131 A.2d 180, 184 (Del. Super. 1957); Wilmington Housing Authority v. Harris, 93 A.2d 518, 522 (Del. Super. 1952).
118. State ex rel. State Highway Dept. v. 14.69 Acres of Land, 226 A.2d 828, 832 (Del. 1967); 0.089 of An Acre of Land v. State, 145 A.2d 76, 79 (Del. 1958); Milford v. .2703 Acres of Land, 256 A.2d 759, 759-60 (Del. Super. 1969); 1.67 Acres of Land v. State, 225 A.2d 763, 765 (Del. 1967); Board of Education v. 13 Acres of Land, 131 A.2d 180, 182 (Del. Super. 1957); State ex rel. State Highway Dept. v. Morris, 93 A.2d 523 (Del. Super. 1952). Although courts in other jurisdictions have recognized an exception to this rule which permits evidence of a value unique to the portion taken, such methodology has yet to be applied in Delaware. See State ex rd. Secretary of Department of Transportation v. Townsends, Inc., C.A. No. 91C-09-00l, Graves, J. (Del. Super. Sept. 1, 1992).
119. State v. Botluck, 200 A.2d 424, 426-28 (Del. 1964); State ex rel. State Highway Dept. v. Morris, 93 A.2d 523 (Del. Super. 1952).
119.1. Acierno v. State, 645 A.2d 1328, 1332-33 (Del. 1994).
120. Conestoga Chemical Corp. v. F. H. Simonton, Inc., 269 A.2d 237, 239 (Del. 1970); Those Certain Underwriters at Lloyd’s London v. National Installment Ins. Services, Inc., C.A. No. 19804-NC, slip op. at 20, Parsons, V.C. (Del. Ch. Apr. 16, 2007).
120.1. Tenneco Automotive, Inc. v. El Paso Corp., C.A. No. 18810-NC, slip op. at 10, Noble, V.C. (Del. Ch. Jan. 8, 2007).
120.2. Kardos v. Harrison, 980 A.2d 1014, 1017 (Del. 2009); U.S. v. Anderson, 669 A.2d 73, 75-79 (Del. 1995).
121. Hazlett v. Fletcher, C.A. No. 769, slip op. at 8, Walsh, V.C. (Del. Ch. Mar. 1, 1985).
© 2010 David L. Finger