TAT LEE FURNITURE MANUFACTORY LTD v. 澳柏設計有限公司

DCCJ 5327/2007

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 5327 OF 2007

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DECISION

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1.  This is the Defendant’s application to set aside the judgment entered against it on 27 February 2008 in the sum of $72,579.  The Defendant accepts that the Plaintiff’s service of the originating process is regular, and that the judgment is a regular judgment.

2.  The Plaintiff is a manufacturer of furniture and supplied furniture to the Defendant at its requests and orders.  In the Statement of Claim the Plaintiff states that it issued seven invoices (in the total amount of $167,724) in respect of goods sold and delivered to the Defendant.  Out of these seven invoices, two invoices were fully paid.  Of the outstanding 5 invoices, two were partly paid, and three were unpaid. The five outstanding invoices are A0835, A0836, A0868, A0743 and A0834. 

3.  The writ was issued on 3 December 2007.  On 10 July 2008, the Defendant made a part payment of $14,060 to the Plaintiff.

The Defendant’s dispute on A0835

4.  The sum involved is $11,850.  On 10 July 2008, the Defendant paid $10,950 to the Plaintiff, leaving $900 to be disputed.  The Plaintiff alleges that the Defendant failed to honour the settlement agreement reached with the Defendant on 14 July 2008 for accepting the lesser sum of $10,950 on the basis or on the implied term that the Defendant was to pay the agreed sum of $10,950 forthwith.  So when the Plaintiff issued the writ of summons on 3 December 2007, it claimed this full amount of $11,850.  Seven months thereafter, on 10 July 2008, the Defendant paid to the Plaintiff $10,950.  It accuses the Plaintiff of breaching its promise of not accepting a lesser sum of $10,950, in lieu of $11,850.  If the Defendant had intended to pay the lesser sum of $10,950, it should have made the payment shortly after the settlement agreement has been reached.  No explanation has been offered for the non-payment of $10,950.  The reasonable inference is that it did not intend to make any payment until 10 July 2008.

Defendant’s dispute of Invoice A0836 and Invoice A0834

5.  In its 2nd affirmation, the Defendant said that it did not receive the goods from the Plaintiff in respect of Invoice A0836 and Invoice A0834.  But in its 3rd affirmation, contrary to its 2nd affirmation, it said that it did receive all the goods except item No. 5.  However, having received the goods, it did not make any payment.

6.  It alleges that due to poor finishing of the products and unreasonable charges for accessories, a settlement agreement in the sum of $50,000 was reached between the parties on 23 February 2007 for full and final settlement of all the invoices in relation to the work site concerned. On 28 May 2007, the Defendant wrote to the Plaintiff alleging “poor lacquer finish”, without referring to the settlement agreement of $50,000.  If a settlement agreement had been reached on 23 February 2007, it should have referred to it on 28 May 2007.  The Defendant did not offer any explanation as to why it referred to this settlement agreement in its 3^rd affirmation, but not in its 2^nd affirmation.

7.  The Plaintiff’s statement of account was sent to the Defendant on 4 June 2007, stating that $41,475 was paid on 23 February 2007.  The Defendant did not complain that the Plaintiff was in breach of the settlement agreement of $50,000 until it made its 3rd affirmation on 10 July 2008.

The Defendant’s dispute on Invoice A0868

8.  In its 2^nd and 3^rd affirmations, the Defendant said that it did not receive the goods except items 3 and 4.  According to the Defendant’s 2^nd affirmation, Invoice A0868 was sent to the Plaintiff under cover of the Defendant’s fax message dated 6 July 2007, in which the Defendant did not allege any non-delivery of goods.  If there had been non-delivery of any item, it would naturally have mentioned it in its correspondence with the Plaintiff.  On 10 July 2008, the Defendant paid $3,110 to the Plaintiff for items 3 and 4.  If it had intended to make payment for items 3 and 4, it should have paid a long time ago.

The Defendant’s dispute on Invoice A0743

9.  In its 2^nd affirmation, the Defendant presented a receipt and invoice to show that it had already paid this invoice upon demand.  In its 3^rd affirmation, it said that there was an oral agreement concluded between the parties so that this invoice had been cancelled.  If that had been the case, it should not have stated that it had already paid for this invoice in its 2^nd affirmation.

10.  The above five invoices were issued in January 2007.  After repeated demands made by the Plaintiff, the Defendant began to make  complaints on the poor quality of goods delivered, but it did not make payment for those goods upon which it made no complaint. No explanation was given in this regard.

11.  On 10 July 2008, the Defendant made payment of $14,060 to the Plaintiff.  There is no explanation why it made payment at that stage, 7 months after the writ had been issued.

12.  The evidence of the Defendant is simply incredible.  I cannot see how the evidence of the Defendant can well be established at trial, even if the judgment is set aside.  The Defendant simply has no prospect of success in its case.  For these reasons, I dismiss the Defendant’s summons.

Costs

13.  I make an order nisi, to be made absolute in 14 days’ time, that the Defendant do pay costs of this application to the Plaintiff, to be taxed, if not agreed.