In construction defect disputes, the plaintiff (or party proving the defect) oftentimes relies on an estimate instead of actual costs. The reason being is that the plaintiff is awaiting money from the dispute in order to fund the repairs. I have previously discussed that there is nothing wrong with a plaintiff relying on an estimate to support its damages in a construction defect dispute.
However, it is important when relying on an estimate to ensure that you have the right person or expert testifying so that there is NOT an issue with that estimate being introduced as evidence during trial. If the estimate forms the basis of your damages, you want to ensure that estimate is admissible evidence at trial.
Recently, I wrote an article about the application of the business records exception to the hearsay rule. This article discussed a case where a plaintiff owner tried to introduce its estimate / damages through its architect. The problem was that while the architect generated the repair scope of work (which is common), the architect did not generate the cost / pricing information. Rather, the owner’s general contractor generated the cost estimate / pricing information with input from subcontractors (which is common). Thus, the cost estimate / pricing information was hearsay as it pertained to the architect that was not properly admissible under the business records exception to the hearsay rule. But, this evidence would likely be deemed admissible if the general contractor testified as to the cost estimate.
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