Come.Com Disco Ltd. v. JC Concept Ltd.

HCA 813/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 813 OF 2001

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ASSESSMENT OF DAMAGES

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1. The plaintiff engaged the defendant in the design and decoration of a disco at 1st Floor, Queen's Theatre Shopping Arcade, 31 Queen's Road Central, Hong Kong.

2. A written agreement was submitted by the defendant on 23 February 2000, signed and accepted by the plaintiff on 12 April 2000.

3. A revised version of the agreement was executed on 22 May 2000. In the revised agreement parties specified the dates of payment and spelt out the time for the completion of the works at clause 9.

4. By the agreement the defendant company was appointed the designer, projector manager and the main contractor for the design, site management and construction of the work. The scope of work included:-(i) making licensing application; (ii) carrying out the electrical and mechanical work; and (iii) carrying out basic fit-out work.

5. The payment schedule agreed in the revised version of the agreement read as follows:-

	E & M Works	Fitting-out Works
12.4.00		840,000 (30%)
24.5.00	450,000 (50%)
15.6.00	360,000 (40%)
24.6.00		420,000 (15%)
30.6.00	90,000 (10%)
15.7.00		420,000 (15%)
30.7.00		420,000 (15%)
15.8.00		280,000 (10%)
1.1.01		420,000 (15%)
	_________________	_________________
	HK$900,000 _________________	HK$2,800,000 _________________

6. Pursuant to clause 8 of the agreement, the defendant executed a surety bond with Wing Lung Bank on 8 June 2000 for a sum of HK$420,000 to guarantee the completion of the work

7. At the request of the defendant, the plaintiff paid the defendant a total of HK$3,010,000 in respect of the contract sums on the following dates:-

(i) HK$940,000 on 12 May 2000;

(ii) HK$400,000 on 7 June 2000;

(iii) HK$830,000 on 12 July 2000; and

(iv) HK$840,000 on 25 August 2000.

8. The defendant commenced work on 25 August 2000 after the receipt of the first payment but ceased working before the completion of the work. Since 26 August 2000 the plaintiff lost touch with the defendant.

9. The plaintiff appointed a surveyor who inspected the site on 26 September 2000 to assess the construction costs of the work done in the disco and found the work done was worth HK$737,055.52, inclusive of HK$8,000 insurance payment and HK$100,000 licensing application.

10. A writ was issued on 14 December 2001. In default of notice of intention to defend, interlocutory judgment was entered in favour of the plaintiff on 9 May 2001 for damages to be assessed.

11. In default of the defendant's appearance, there was no other evidence before court. On balance of probability, I accept the plaintiff's version of events and the evidence of the plaintiff's surveyor on the valuation of the work done by the defendant and the materials left at the site.

12. Since the plaintiff has not obtained any payment from the bank in respect of the HK$420,000 surety bond, I award the plaintiff the sum of HK$ 2,272,944.48, being the difference of the payment made by the plaintiff and the value of work done and the materials supplied by the defendant. I also award commercial interest at 1% above prime from the date of writ to the date of judgment. Judgment interest accrues from the date of judgment until payment.

13. I award the plaintiff order nisi for its costs for the assessment hearing. The quantum is to be taxed if not agreed to between the parties.