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XI. Economic Waste

The Alaska Supreme Court disfavors remedies that would lead to economic waste and deems that parties to a contract intend to avoid a remedy that would result in economic waste, for example, where physical reconstruction and completion in accordance with the contract would involve unreasonable by destruction of usable property. North Pacific Processors, Inc. v. City and Borough of Yakutat, 113 P.3d 575 (Alaska 2005). Likewise the Alaska court disfavors a remedy where the cost of remedying the defect would involve unjust enrichment of the owner, such as in a case where the owner might simply pocket the cost to cure the defect and would not undertake to remedy the defect. Economic waste is therefore viewed as a criterion by which the jury can assess whether or not the owner reasonably would remedy the defect or would utilize the building in its defective state. Another criterion is whether the owner's purpose is to gratify personal taste and fancy. If so, he may be entitled to damages measured by the cost of completion, even if it involves economic waste. Hancock v. Northcutt, 808 P.2d 251, 255 (Alaska 1991).