It's a bit of a while since I studied contract law but here are the facts, as i understand it...
You, as a consumer, entered into a contract with Honda's agents to install two 150 hp engines. While the boat was in their care, they allowed water to enter the hull of the craft, and as a result of this the engines, at the time of delivery to the consumer were damaged.
In undertaking this work, there is an implied term (s9 Supply of Goods and Services Act 1982 S9(2)) that they will supply goods which match the description in their marketing material (ie work). They are also obliged to take reasonable care and skill (s13 SOGSA 1982) in the installation of the engine. I would argue that allowing the craft to flood while in their care would breach this term of the contract.
See also The Unfair Terms in Consumer Contract Regulations 1999 section 3(1) if they attempt to limit their obligations under the above by reference to their standard terms.
These are known as minor breaches of contract, and so recission (cancellation) of the contract would not normally be allowed. However minor breaches give rise to either an obligation to pay damages or to repair the items.
So following that little jaunt down revision lane, some practical solutions.
Seek experienced legal advice
Send the agents a letter by registered delivery outlining what you, as an organisation believe to be the situation, and how they have an obligation to put right the breach of warranty regarding the fitness for purpose of the engines, immediately following the install. Indicate that you will be informing Honda Marine at the highest level about your dissatisfaction with the situation if they don't sort it out. Set a timescale for them to respond - maybe 10 days.
If they fail to respond, contact Honda Marine, again by registered letter, stating your dissatisfaction, and the facts as you see them.
If that fails to assist, seek legal advice and potentially sue them for damages.
Your statements about how yammie are better are quite ironic given the history of the boat in question. Can I ask why you didn't simply limit the existing engines, instead of going through the risky and complex process of getting the new engines fitted?
M
PS I've made a few significant assumptions in the writing of my reply, and so please remember that this is a forum reply written by some anonymous bloke on the web so don't cite it without further research and advice.
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