RED CHAMBER CO v. LAU SIU MAN t/a PROFESSIONAL CARGO DELIVER SERVICES CO

DCCJ 2790/2009

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 2790 OF 2009

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J U D G M E N T

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1.  The Defendant is named as the Consignee and Notify Party under the Bill of Lading which is the subject matter of this dispute.  When the Defendant was notified by the carrier of the arrival of the cargo, the Defendant made arrangements to procure delivery.  The Plaintiff claims that it was a clerical mistake when it named the Defendant as the Consignee and Notify Party and that the Defendant had wrongly taken delivery of the goods which were meant for another party.  These proceedings are instituted by the Plaintiff against the Defendant for conversion, breach of duties as bailee and unjust enrichment, the latter of which has been confirmed to be abandoned this morning.

2.  This case in my opinion is clearly inappropriate for summary judgment as it turns entirely on the credibility of the witnesses and on whose version of the facts in dispute should be believed.  It is the Plaintiff’s claim that the mistake in naming the Defendant as Consignee and Notify Party under the Bill of Lading was made by an unidentified clerk of the Plaintiff.  However, only a director of the Plaintiff has come forward to make an affirmation relating to this alleged clerical mistake, and no explanation has been given as to why the clerk responsible has not verified the mistake alleged.

3.  On the other hand, the Defendant claims that he had received instructions from his client and principal, one Mr Chan, to take delivery of the cargo under the Bill of Lading.  He claims that he had no reason to doubt and had no notice of any defect in title of Mr Chan or Mr Chan’s right to take possession and delivery of the cargo, and that he had acted in good faith.  It is not in dispute that, at the time when the Defendant paid for the charges under the Bill of Lading and obtained the release order from OOCL, the carrier, to obtain the cargo, the Defendant did not have the original Bill of Lading but had signed OOCL’s standard letter of indemnity.  The Defendant also claims that he had been informed by OOCL that they had been contacting the Plaintiff to obtain instructions for release of the cargo in accordance with normal practice within the trade.

4.  Leaving aside for the time being all the technical legal arguments, if the Plaintiff’s evidence on the alleged clerical mistake is rejected and the Defendant’s evidence is to be believed, I cannot see how the Defendant can be said to be negligent and in breach of his duty under any alleged bailment when he had followed the instructions of his principal.   Nor can I see how he can be said to have converted the goods when he was acting as the consignee named in the Bill, or if OOCL had obtained the Plaintiff’s consent to the release of the cargo.

5.  The credibility of the witnesses and whose evidence is to be believed obviously cannot be determined summarily at this stage without cross-examination of the witnesses.  On all the evidence filed before me, I cannot say at this stage that the Defendant’s evidence is unbelievable on the basis of the correspondence between the solicitors only, that the letter of instructions is fabricated, or that there is no arguable defence.

6.  I am also satisfied that there are arguable issues as to whether the Plaintiff had possession or the right to possession or any reversionary interest, as the Plaintiff alleges, to the goods.  There are clearly matters for trial, and I therefore grant unconditional leave to the Defendant to defend the action, with costs in the cause.