Plаintiff sued defendant for breach of professional duty and misrepresentation in his inspection of a house on her behalf. The trial court found that a breach had occurred and . awarded her $50 in damages. Plаintiff appeals from the trial court’s determination of damages. We vacate that part of the judgment and remand for further proceedings.
In June of 1979, plaintiff decided to buy a house in Manchester, Vermont fоr $42,500. Prior to the purchase, she signed an agreement with the seller stating, inter alia, that the purchase was contingent upon plaintiff’s obtaining a favorable inspection report on the property. Plaintiff hired defendant, a builder, to carry out this inspection.
Defendant gave plaintiff a one-page report which stated that the house (including the foundation, structural timbers, plumbing, electrical wiring, and roof) was in good сondition. Plaintiff, relying on the report, then completed the purchase.
Despite the representations made in defendant’s inspection report, plaintiff discovered, after the sale, numerous defects in the house which required substantial repairs. In the course of the next few years, she spent over $25,000 to put the house into shape, and then sued defendant to recover the sums she had expended, alleging that he had a duty to perform the inspection in a professional manner, and that his breach of that duty was the proximate cause of damage to plaintiff. In addition, plaintiff claimed that defendant either nеgligently or intentionally misrepresented certain facts about the property, and that she relied on his representations in deciding to purchase it.
*55 Defendant did not appear personally for trial, аlthough his attorney was present, and the trial court entered a default judgment against him on the issue of liability. * The court then proceeded to take evidence on the issue of damages. Plaintiff claimed damages totaling $25,214.10, the amount she had spent on repairs after buying the house.
Acknowledging that the “sole question” before it was the amount of damages to be awarded, the court concluded that compensating plaintiff for all her reasonable expenses in bringing the house into line with the inspection report would produce “an eminently unfair result,” since evidence showed that the value of the property at the time of trial, some seven and one-half years after the purchase, was in excess of the $67,714.10 she had ultimately spent on it (purchase price plus repairs):
If this [c]ourt were to grant her the reasonablе cost of her repairs, it would be giving her a reward rather than an award----Our purpose is not to put an injured plaintiff in a better position than he or she would have otherwise occupied. Such would be the result if thе plaintiff received the damages she seeks____
Instead — and noting it was only “small consolation” — the court awarded plaintiff a judgment for $50, representing the fee she had paid defendant for the inspection report in 1979.
Plaintiff appeals from the determination of damages, contending that the trial court erroneously looked to the present value of the property in ascertaining damages. We agreе, and reverse for a redetermination of damages in light of this opinion.
In a tort action, compensation is provided so as to restore the person damaged, as nearly as possible, to the position he or she w-ould have occupied had no wrong been committed.
My Sister’s Place v. City of Burlington,
[A] party seeking damages for fraud is entitled to “recover such damages ... as will compensate him for the loss or injury actually sustained and рlace him in the same position that he would have occupied had he not been defrauded.”
Cushman v. Kirby,
Generally speaking, there are two theories of damages in cases involving fraudulent or negligent misrepresentation in property sales cases. Some jurisdictions rely on the “out-of-pocket” rule, which permits recovery of the difference between the price paid for the property and the аctual value of the property acquired, necessarily calculated as of the time of the transaction. See, e.g.,
Dresser v. Sunderland Apartments Tenants Ass’n,
Some jurisdictions apparently use both rules depending on the facts of the particular case before them. For example, in
Correa v. Maggiore,
This Court, while using the phrase “benefit of the bargain,” has similarly adopted a flexible, rather than a dogmatic, approach to calculating damages in frаud cases. In
Cushman v. Kirby,
noting that compensation was the goal, we stated: “The precise measure of damages that will provide the defrauded party with the benefit of his bargain, however, depends on ‘the facts аnd circumstances surrounding the fraud, and the nature and extent of the injury suffered by the defrauded party.’”
To deny plaintiff any recovery because the property as a whole appreciated in value over the seven-year period between purchase and trial would be clearly inequitable, since this is not a case where the repair price substantially exceeds the original contract price оr current market value of the house,
*58
see, e.g.,
Correa v. Maggiore,
Instead, in cаlculating damages here, the trial court should have looked first to the nature and extent of the injury to plaintiff in determining what would make her whole again. Plaintiff bargained for a house in good condition, and did everything within her power to assure herself that that was what she obtained. Due to defendant’s misrepresentation-negligent at the very least — she obtained a house in less than good condition, but which could be repaired so that it would be as represented in the inspection report. On remand, the trial court must determine what it will take to give plaintiff the benefit of her bargain, considering all of the surrounding facts and circumstances.
Cushman,
We note that it is unclear from the trial court’s findings whether all of the $25,214.10 expended by plaintiff arose out of repairing the items represented by defendant to be in goоd condition in his report, or whether some portions of those expenses were general improvements to the property over and above the necessary repairs. While any general aрpreciation of the property cannot relieve defendant of his monetary liability, he should not be held liable for expenses incurred by plaintiff which were not directly related to the state of affаirs represented in his erroneous inspection report. Thus, on remand, if the trial court determines that the cost of repairs *59 is the appropriate measure of damages required to give plaintiff the benefit of her bargain, it should ascertain what repairs would have been necessary to put the house into the condition represented in defendant’s report at the time of the purchase.
The damagеs portion of the judgment is vacated, and the cause is remanded for further proceedings consistent with this opinion.
Notes
In his brief and at oral argument, defendant contended that the default judgment entered against him on the issue of liability was erroneous. As he did not cross-appeal from the trial court’s decision, however, that issue is not properly before us. The only issue on this appeal is the correctness of the damage award.