CHEERY HUA (H.K.) LTD. v. THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIPS OR VESSELS "SUN ON T1" AND "SUN ON T3"

HCAJ 280/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ADMIRALTY ACTION NO. 280 OF 1998

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Admiralty action in rem against
The ships or vessels "SUN ON T1" and "SUN ON T3"

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ASSESSMENT OF DAMAGES

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1. This is an application for assessment of damages referred to the Registrar by a Judge under Order 75 rule 41 of the Rules of High Court.

2. The Plaintiff is the owner of Split Hopper Barge SHB1006 ("the Barge") which was chartered to Hong Kong Dredging Limited for a certain period. During that period the Barge was rechartered back to the Plaintiff for the period from 1 June 1996 to 31 May 1997 at a monthly rent of $120,000.00.

3. On 6 September 1996 at 4:00 a.m. the Barge was in tow of the tug by the Defendant. The Barge was carrying rockfill for another company known as Chevalier (Civil Engineering) Limited from Ma On Shan to Junk Bay. The Barge hit certain submerged object whereby the hull was holed. On arrival at Junk Bay Reclamation Site, it was discovered that the Barge had capsized.

4. On 5 September 1998 action in rem was instituted against the Defendant. Defence was filed. Due to failure to observe an order for production by the Defendant the Plaintiff entered judgment against the Defendant upon the following terms:-

"The Defendants do pay the Plaintiff damages to be assessed with interest thereon together with costs to be taxed."

The claim was referred to the Registrar as aforesaid. I am satisfied that the Plaintiff has taken all the necessary steps and complied with the requirements under rule 41. I proceed on with the assessment.

5. At the hearing the Plaintiff called Chan Choi Fat Peter, the senior manager of the Plaintiff company, to give evidence. He verified the various items of the claim and produced to me the necessary documents in support. I am satisfied that the Plaintiff has suffered loss and damages under the following heads.

(1) Cost of salvage and towing

6. On 7 and 8 September Tai Wah Sea and Land Heavy Transportation Limited was engaged to lift up the Barge. The costs for doing that was $280,000.00. I noted that $200,000.00 had been paid with an outstanding balance of $80,000.00. I allow the sum in full.

7. The Barge had to be towed from place to place, from shipyard to shipyard; this had been carried out by Hong Kong Dredging Limited which charged a total sum of $12,000.00. I find such expenses was properly incurred.

(2) Costs of repair performed by Delon Company Limited

8. This item mainly relates to repair damage done to the framework and the hull of the Barge. It includes the labour costs, material supplied and also storing fees. The total amount incurred was $281,890.00. I have examined the different invoices I find that they are fair and reasonable.

(3) Costs of repair work done by Hong Kong Dredging Limited

9. This relates to installation of new equipments and accessories to the Barges. The total amount is $299,894.00. I have gone through the different invoices and find that most of them relate to machinery electrical works, environmental equipments and other safety equipments. As the Barge had capsized there is no reason why all these different equipments should not be installed again. I allow the amount in full.

(4) Survey Fee

10. Marine Department carried out surveys at different times, that is, 7 March 1997, 24 March 1997 and 1 April 1997. After the last survey the Department gave the necessary approval. The Barge could be used again. The survey fee for that purpose (amounting $12,210.00) was a necessary item.

(5) Loss of the use of the Barge/Hiring other barges in substitute

11. The Plaintiff showed me that from the date of the incident to the time that the Barge could be put into use again (i.e. from 6 September 1997 to 4 April 1998) the Plaintiff had to hire other barges to perform the contract with Chevalier for carrying the rockfills. It obtained supply of barges from Hong Kong Dredging Limited at the monthly rent of $120,000.00. The total amount that had been spent under this heading was $836,000.00. I am satisfied with the necessity of retaining such services. I allow the amount in full.

(6) Interest

12. As to payment of interest Mr. Yiu for the Plaintiff calculated for me interests on different expenses incurred from the date of payment of various sums to the date of hearing (i.e. 26 March 2001) at the judgment rate. It is trite law that upon for the sake of carrying out restitutio integrum interests should be awarded upon the costs of repairs from the date at which the bill for repairs had been paid by the Plaintiff. Accordingly I accept the calculation with the total sum of $694,955.25.

Conclusion

13. For reasons I have given I would allow damages under the following headings:-

(1)	Cost of salvage and towing	$280,000.00
	Towing fee	$12,000.00
(2)	Costs of repair performed by Delon Company Limited	$281,890.00
(3)	Costs of repair work done by Hong Kong Dredging Limited	$299,894.00
(4)	Survey Fee	$12,210.00
(5)	Loss of the use of the Barge	$836,000.00
	Total:	$1,721,994.00

I order that final judgment be entered for the Plaintiff against the Defendant for the sum of $1,721,994.00 with interest up to 26 March 2001 in the sum of $694,955.25 and also with further interest thereafter on the sum of $1,721,994.00 at the Judgment rate until full payment.

14. I am also asked to assess the costs and disbursements. A detailed itemized bill has been prepared and submitted for assessment. I have examined the different items and checked with the documents I have in hand. The profit costs and disbursement as submitted to me amount to approximately $328,205.00. The damages award is $1,721,994.00 only. The legal expenses come up to nearly 20% of the claim. The case has not gone to trial. I have to estimate both the profit costs and disbursement taken together on party and party basis i.e. on the basis of whether it is proper or necessary. I find the sum of $328,208.00 to be excessive and high. I assess the sum should be $200,000.00. Accordingly, I make an order nisi as to costs assessed in the sum of $200,000.00 to be paid by the Defendant to the Plaintiff.