TO YUNG SING HERMAN v. SZETO CHAK MEI AND OTHERS

HCMP 2741/2016

[2024] HKCFI 1148

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 2741 OF 2016

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ASSESSMENT OF DAMAGES

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1.  Following the Court’s Judgment handed down on 15 December 2023 (“Dec 2023 Judgment”), I gave directions to the parties for working out the calculations of the various outstanding figures, taking into account the rulings and conclusions in my judgment.  

2.  By a joint letter dated 23 February 2024, the parties have provided me with a Joint Statement of Mr Tse and Mr Lee, containing the agreed figures and calculations.    

3.  The agreed valuation figures are set out as follows:

	Agreed valuation / calculation
Completion Date (2016)
-   existing use basis	HK$57,621,000
-   redevelopment basis	HK$31,399,000
-   adopted value	HK$57,621,000
Judgment Date (2018)
-   existing use basis	HK$82,054,000
-   redevelopment basis	HK$73,891,000
-   adopted value	HK$82,054,000
Loss of rental from Completion Date to Judgment Date based on market rental value as at Completion Date	HK$4,593,278

4.  In light of my ruling that the valuation date should be the Completion Date, the quantum of damages for P’s claim for loss of bargain should be based on the market value of the Property as at Completion Date, ie HK$57,621,000, less the contract price under the Agreement (HK$50,000,001). 

5.  The amount of damages is calculated as follows:

HK$57,621,000 - HK$50,000,001 = HK$7,620,999

6.  P should also be entitled to pre-judgment interest, on the usual rate of P+1%, from the Completion Date up to the date of this Judgment: see Dec 2023 Judgment §75.  

7.  If I am wrong that the valuation date should be the Completion Date, then:

7.1  The quantum of damages for P’s claim should be based on the market value of the Property as at Judgment Date, i.e. HK$82,054,000, minus the contract price.

7.2  The amount of damages should be calculated as follows:

HK$82,054,000 – HK$50,000,001 = HK$32,053,999

7.3  P would also be entitled to loss of rental from the Completion Date to the Judgment Date, which is HK$4,593,278.

7.4  P should also be entitled to pre-judgment interest, on the same rate, from the Judgment Date up to the date of this Judgment.  

8.  It follows that I will formally make the following orders in the assessment exercise:

8.1  Judgment in favour of P for loss of bargain in the sum of HK$7,620,999.

8.2  Interest on the sum of HK$7,620,999 at 1% above the prevailing HSBC prime rate from the Completion Date (ie 31 May 2016) up to the date of this judgment, and thereafter at judgment rate until full payment.

8.3  P’s claims for increased agency commission, increased stamp duty, and costs of the Colliers Report and the CBRE Report be dismissed.

8.4  P is entitled to interest on the Deposit from the Completion Date (ie 31 May 2016) to 24 August 2018 at 1% above the prevailing HSBC prime rate.

9.  In terms of costs, I make an order nisi that P should get 50% of its costs in the assessment with certificate for two counsel, such costs is to be taxed if not agreed.  I have taken into account the following:

8.1  P had to go through the assessment to obtain the award it has obtained now, and the result achieved is better than Ds’ position as at the Completion Date, but at the same time there was a substantial reduction in the quantum put forward by P (see Dec 2023 Judgment §35). 

8.2  Given that there was no direction for a split trial, I would not regard it as unreasonable for P to present valuation evidence of the different assessment dates open on the evidence.  However, as it turned out, the redevelopment basis, which generated a large part of the valuation evidence, was of no consequence. 

8.3  P has lost on the other (relatively minor) heads of claim, being increased stamp duty, increased agency commission and costs for the CBRE and Colliers Reports.