BRITISH MOTORS LTD v. PEDRUCO LUIZ A. DA SILVA also known as BAI ZHONG QI

DCCJ 3783/2012

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 3783 OF 2012

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J U D G M E N T

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1.  This is the plaintiff’s claim for outstanding charges for repair works done to the defendant’s 1993 Jaguar convertible car (“Vehicle”) back in 2010. The plaintiff further claims storage/parking costs.

2.  The Plaintiff is a company which carries on an automotive distributing, retailing and repairing business.  The Defendant is a practising barrister-at-law.

3.  The canvas rooftop of the Vehicle (“Rooftop”) is broken.  Photographs in the trial bundle show a slit opening at the rear of the Rooftop.

The Plaintiff’s Case

4.  On or about 10 February 2010, the Defendant delivered the Vehicle to the Plaintiff’s Aberdeen Parts & Service Branch (“Aberdeen Branch”) and instructed the Plaintiff to inspect and carry out repair works to the Vehicle.  On 8 March 2010, Mr. Jacki Tam (“Mr. Tam”), a service advisor of the plaintiff, sent to the defendant a repair costs estimation no. ABN/EST/117 (“First Costs Estimation”) setting out the repair works to be done to the Vehicle (“the Repair Works”) at a total cost of $319,064.10.

5.  It should be noted at the outset that the First Costs Estimation contains no quotation of repair costs for the repair of the Rooftop. Instead, there is a remark to record the fact that production of  certain parts including the one for repairing the Rooftop had ceased:-

“ ********NEED ATTENTION********

WAITING PART DEPARTMENT CHECK PART STOCK & PRICE BECAUSE SECTION PARTS PRODUCTION CEASED – ITEMS: ELECTRIC SUN ROOF ASSY, LH FRT FOG LAMP, A/C HOSE CRANKSHAFT DAMPER, P/S PUMP & HOSES, A/T GEARBOX REAR HOUSING -------- TO BE COTINUOUS -------- ”

(“Remark”)

6.  There is a handwritten note of Mr. Tam next to the Remark which reads “部份零件厰已經停產，零件部在找尋中 (電蓬一個……” meaning the parts department was searching for those parts the production of which had ceased, including an electric sunroof assembly.[1]

7.  During a telephone conversation between Mr. Tam and the defendant on 13 March 2010, the defendant approved the Repair Works. A repair contract was thus made between the parties (“the Repair Contract”).  On 14 June 2010, the defendant paid to the plaintiff a deposit of $30,000 for the Repair Works.

8.  The plaintiff completed the Repair Works on 25 October 2010 and reported the same to the defendant.  From 15 November 2010 to 10 January 2011, the plaintiff made various attempts to contact the defendant with a view to reminding the latter to make payment and collect the Vehicle but could not reach the latter.  

9.  By two letters dated 14 January 2011 and 24 January 2011 respectively, the plaintiff put the defendant on notice that a storage/parking fee at the rate of $500 per day would be charged from 1 February 2011 onwards if the Vehicle was still not removed from the plaintiff’s facility.  On 28 April 2011, the plaintiff issued another reminder asking the defendant to collect the Vehicle and settle the outstanding amount.

10.  On 1 June 2011, the defendant visited the Aberdeen Branch.  On this occasion, the plaintiff prepared a fresh costs estimation consolidating the First and Second Costs Estimations and offering further discounts (“Consolidated Costs Estimation”).[2] The defendant refused to settle the outstanding chargeon the ground that repair to the Rooftop remained outstanding (“alleged Outstanding Work”).    

11.  As the defendant failed to settle the outstanding charge and collect the Vehicle within a reasonable period after completion of repair, the plaintiff treated the same as repudiation of contract and accepted the same by the issuance of writ herein.  After deduction of previous payment by the defendant, the outstanding amount came to $277,184.10 while the outstanding storage/parking costs from 1 February 2011 up to the date of the Statement of Claim stood at $312,500 and have since been accumulating.

12.  It should be noted that on 10 May 2010, Mr. Tam sent to the defendant another costs estimation (“Second Costs Estimation”) quoting charges for, inter alia, “Respray both fender (inner side) & Chassis”.[3] The defendant approved the same on 17 May 2010.  In the present action, however, the plaintiff is claiming only the outstanding charge for the Repair Works and has practically forgone the charge for the works done pursuant to the Second Costs Estimation.   

The Defendant’s Case

13.  On or about 10 February 2010, the defendant delivered the Vehicle to the plaintiff specifically for repairing the Rooftop as it was torn.  On the recommendation of Mr. Tam, the Vehicle was checked by the plaintiff to find out other parts that would require replacement.  

14.  After delivery of the Vehicle to the plaintiff and before 14 June 2010, the defendant had had various telephone conversations with Mr. Tam in the course of which Mr. Tam on behalf of the plaintiff informed the defendant, inter alia, that the Rooftop would be repaired by the plaintiff.  At all material times, Mr. Tam assured the defendant that the plaintiff was arranging for repair of the Rooftop.

15.  It is the defendant’s case that, without repairing the Rooftop, the plaintiff has not fully performed the entire obligation under their contract.  Further, it was agreed between the parties that the defendant would not have to make any further payment after the deposit was paid until completion of all repair works including the Rooftop.  And since the defendant left the Vehicle at the plaintiff’s premises for repair works to be carried out and there remain outstanding works, the plaintiff is not entitled, in the absence of the defendant’s agreement, to charge the defendant for any parking fees.

16.  The plaintiff called Mr. Tam and his supervisor Mr. Willis Lee, Service Manager in charge of the Aberdeen Branch (“Mr. Lee”) to testify in court while the defendant himself was the only defence witness.

Mr. Tam

17.  According to Mr. Tam, on or about 10^th February 2010 at around 10:00 a.m., he received a phone call from the defendant saying that the Vehicle had not been used for a long time and could not be switched on and he would like to deliver it to the Aberdeen Branch for checking.  As the defendant said he wished to use the Vehicle in the Mainland after repair, Mr. Tam reminded the defendant of the need for re-licensing and licensing of the Vehicle both in Hong Kong and in the Mainland.  The defendant also said he would take the Vehicle after repair to the government inspection centre for inspection before arranging for relicensing thereof and would like the plaintiff to assist.  Mr. Tam made a record in a job card (“the Job Card”).[4] 

18.  In the afternoon of the same day, the Vehicle was towed to the Aberdeen Branch.  Upon a quick visual inspection, Mr. Tam noticed that there was a hole in the Rooftop and called the defendant to notify him of the same.  The defendant noted and instructed him to continue to prepare a costs estimation of the repair works to be done. The defendant also subscribed to the plaintiff’s annual checkup service.

19.  Thereafter, Mr. Tam performed an overall checking on the Vehicle.  On or about 8 March 2010, he finished the checking and faxed to the defendant the First Costs Estimation.  Prior to that, he had specifically checked the plaintiff’s inventory record and noted that the relevant part for repairing the Rooftop was no longer available, hence the Remark in the First Costs Estimation. 

20.  On 13 March 2010 at about 14:35, Mr. Tam called the defendant to seek his approval of the First Costs Estimation.  Having been notified by the parts department of the unavailability of parts from the original manufacturer, he told the defendant that the plaintiff could not assist in repairing the Rooftop.  Noting that the defendant intended to use the Vehicle in the Mainland, he suggested that the defendant might be able to find alternative repair sources for the Rooftop in the Mainland.  As to the other parts mentioned in the Remark, however, he told the defendant they could be sourced in due course. 

21.  The defendant raised no objections and instructed Mr. Tam to proceed with the Repair Works.  Mr. Tam recorded the defendant’s approval on the last page of the First Costs Estimation and on the Job Card.[5]

22.  Some time in March to May 2010, the defendant visited the Aberdeen Branch to check on the progress of the Repair Works.  By then, the engine of the Vehicle had been taken out for preliminary inspection and for recording the engine number for licensingpurposes.  Noting that thepaint colour of the interior of the engine compartmenthad faded, Mr. Tam asked if the defendant was interested in having the same re-sprayed before the engine was put back, andthe defendant agreed.  On 10 May 2010, Mr. Tam prepared the Second Costs Estimation.  Upon the defendant approving the same, Mr. Tam recorded the defendant’s oral approval on the Job Card. 

23.  I pause here to note that according to the defendant, the works covered by the Second Costs Estimation was confined to re-spraying of the inner side but not the outside of the car body because the defendant would like to see if waxing (instead of whole-scale re-spraying) would suffice.

24.  While no reference was made in the plaintiff’s pleadings as to the amount of deposit the defendant was required to pay, Mr. Tam maintained that he had demanded the defendant to pay a 50% deposit.  On his own accord, however, the defendant attended the plaintiff’s Wanchai showroom on 14 June 2010and paid a deposit of $30,000.  Despite the small deposit, and upon the instruction of Mr. Lee, Mr. Tam caused the Repair Works to commence to avoid delay.  Mr. Tam denied having ever told the defendant that the plaintiff would not demand further payment from him after his payment of $30,000.

25.  Mr. Tam maintained that from the defendant’s approval of the First Costs Estimation until 7 April 2011, the defendant had never raised any concern regarding the repair of the Rooftop.  He further confirmed that the plaintiff had completedall relevantrepair works (other than repair to the Rooftop) by 25October 2010.   When reportingthesameto the defendant, Mr. Tam asked about the defendant’sarrangement for government inspection of the Vehicle but the defendant said he could not locate the registration document of the Vehicle.  On 29 October 2010, the defendant said he would send the registration document to the plaintiff for their assistance with government inspection of the Vehicle.  That never happened.  In late 2010, Mr. Tam reported the matter to Mr. Lee.

26.  Mr. Tam made various attempts to contact the defendant from 15 November 2010 to early February 2011 but to no avail. While he commented in his witness statement that the defendant might have avoided the plaintiff’s calls, Mr. Tam had admittedly failed to stand by such a comment during cross examination.

27.  With Mr. Lee’s involvement, the plaintiff issued the said letters to the defendant in January 2011 chasing for payment of the outstanding Repair Costs.In the next three months, Mr. Tam made more than 60 phone calls to the defendant’s mobile phone but still failed to reach him.  When he finally managed to speak to the defendant over the phone on 7April 2011, the defendant insisted for the first time to have the Rooftop repaired as a condition to taking delivery of the Vehicle. 

28.  In this connection, Mr. Tam relied on his follow-up sheets in which he recorded the telephone calls to the defendant as from 29 October 2010 up to 5 November 2011 (“Telephone Record”) and which contain a considerable number of entries of “left message” and “Can’t contact”.[6]   While unable to recall the contents of the message left on each such occasion, Mr. Tam confirmed in court that he had in his voice messages chased the defendant for payment of the outstanding charge and collection of the Vehicle.  

29.  On 26 May 2011, during a telephone conversation, the defendant finally agreed to visit the Aberdeen Branch on 1June 2011 to settle the differences with the plaintiff.  During that conversation, Mr. Tam requested the defendant to pay at least half of the repair costs when visiting the Aberdeen Branch.  During his brief visit on 1 June 2011, the defendant did not make any payment other than signing the Consolidated Costs Estimation to acknowledge receipt thereof before he left.

30.  The defendant did not reverton the Consolidated Costs Estimation as promised.  Thereafter, Mr. Tam kept calling him but in vain.  When he finally managed to reach the defendant on 23September 2011, the latter repeated his complaint about the plaintiff’s failure to repair the Rooftop. 

31.  In light of the defendant’s stance, sometime between June 2010 and October 2010, the plaintiff found a third party service provider who could tailor-make a canvas rooftop to replace the Rooftop.  To encourage the defendant to settle the outstanding charge, the plaintiff offered to the defendant to repair the Rooftop free-of-charge.  For this purpose, Mr. Tam prepared a third costs estimation no. ABN/EST/654A (“the Third Costs Estimation”)[7] and sent it to the defendant on 7 October 2011 with a request that the defendant sign the same.  However, the defendant never replied. 

Mr. Lee

32.  Mr. Lee confirmed the plaintiff’s completion of all relevant repair works (other than repair to the Rooftop) by 25 October 2010 and verified Mr. Tam’s unsuccessful attempts to contact the defendant.  He had personally attempted to make contact with the defendant buteach time the defendant’s line was connected, the defendant would use all sorts of excuses to avoid talking (such as being abroad, being busy or saying he would return calls later).  He and Mr. Tam tried to get around the defendant’s evasive responses by using different telephone lines to call him and by having messages left by different callers.  The defendant did return some of the calls but once he knew it was someone from the plaintiff contacting him, he would quickly hang up the phone.

33.  Mr. Lee admitted that the defendant had during his visit to the AberdeenBranch on 1 June 2011 mentionedabout the outstanding repair to theRooftop.  In reply, he reiterated the plaintiff’s position that the Rooftop was never a repair item.  He recalled having told the defendant that should he agree to sign on the quotations on that day, the plaintiff would endeavor to source alternatives in the market to repair the Rooftop for him.  The defendant merely signed to acknowledge receipt of the quotations which he said he needed time to consider.  The defendant did not revert by 3June 2011 as promised. 

34.  Regarding the plaintiff’s claim for storage/parking fees, Mr. Lee said the daily storage fee of $500 was fixed by reference to the hourly rate of $20 charged by nearby carparks.  As the parking spaces at the workshop of the Aberdeen Branch were limited, the defendant’s failure to take back the Vehicle affected the daily operation of and caused potential loss to the plaintiff’s business.  The Vehicle being a convertible car with a broken rooftop, however, the plaintiff did not move the Vehicle elsewhere out of security concern.  In around November 2013, the plaintiff decided to move the Vehicle to Chi Fu Fa Yuen Car Park to minimize the disruption to the plaintiff’s business.

The Defendant

35.  The defendant used to park the Vehicle in a covered car park at his former residence on Conduit Road (which was sold on 11 February 2010, the very next day after the Vehicle was towed to the plaintiff for repair).  The defendant said the Vehicle was delivered to the plaintiff specifically for repairing the Rooftop.  He also wanted the plaintiff to find out if any parts had to be replaced as he had not used the Vehicle for years.  He intended to put a Hong Kong-PRC licence plate on the Vehicle so that he could use it in the Mainland.  

36.  Before 12 March 2010, Mr. Tam telephoned him a few times informing him, inter alia, that it would take some time for the plaintiff to find out the parts that had to be replaced and the prices of the new parts.  Before 14June 2010, he had had various telephone conversations with Mr. Tam in the course of which Mr. Tam on behalf of the plaintiff informed him that the check up fee would be deducted from the total costs of repair; that the Rooftop would be repaired by the plaintiff; that there would be a discount on the total costs of repair upon completion of all the repair works; that after payment of a deposit of $30,000 no further payment would be required until completion of all the repair works; and all new parts would carry a one-year warranty.  And there would be no time limit for the repair to be completed.  

37.  All along Mr. Tam kept assuring him that only after all the repair works had been done would he be required to settle the total cost of repair.  Mr. Tam had at all material times assured him that the plaintiff was arranging for the Rooftop to be repaired. Although he received various letters from the plaintiff demanding payment for the repair works, Mr. Tam repeatedly told him not to take such written demands for payment of repair costs and storage/parking fees seriously as the plaintiff was still arranging for repair of the Rooftop.  He was very surprised and angry when he received demand letters from the plaintiff’s solicitors.

Discussion

38.  While the parties have identified in their joint statement of issues in dispute a number of issues, the key issue is simply whether repair of the Rooftop formed part of the contract between the parties.

39.  As the Repair Contract was an oral one albeit with reference to the First Costs Estimation Mr. Tam faxed to the defendant, it is a case of one man’s words against another’s and credibility of witnesses assumes importance.  In this regard, I find it useful to refer to the recent judgment of Mimmie Chan J. in Yu Jiang & Anor v Cheng Wai Lin Rosalind & Ors (HCA 2562/2005), unrep., 11 June 2014 in which her Ladyship summarized the relevant principles as follows:

“ 5. In deciding factual disputes, the crucial considerations for the court include the inherent probability of the parties’ assertions, whether these assertions are consistent with the parties’ conduct and the contemporaneous documents (if any), and the credibility and demeanour of the witnesses.

6. On assessment of the credibility of witnesses by reference to their demeanour, I have borne in mind the observations made by the courts in cases such as Ting Kwok Keung v Tam Dick Yuen (2002) 5 HKCFAR 336, where Bokhary PJ explained, at p 348:

“ It is common to speak of a trial judge’s advantage of having ‘seen and heard’ the witnesses…. the words ‘seen and heard’ are perhaps capable of giving an exaggerated impression of the role which demeanour plays in the resolution of disputes of fact - demeanour being, as Lord Pearce put it in Onassis v Vergottis [1968] 2 Lloyd’s Rep 403 at p 431, ‘mostly concerned with whether the witness appears to be telling the truth as he now believes it to be’. (Emphasis supplied)

Having said that about demeanour, I should make it clear that I accept that trial judges are entitled to take demeanour into account when assessing testimony. In life what really happened is not always what afterwards seems objectively probable. So demeanour has a role to play. Of course trial judges must bear in mind that demeanour can be deceptive and is therefore to be approached with care. In general, I would trust them to do that. Unless good reason to think otherwise appears, trial judges should be taken to have considered demeanour with caution, doing so only in the context of such inherent probabilities as may exist and the whole of the evidence.

It can of course happen that neither rival account is appreciably more inherently probable or improbable than the other, and there may be little or no evidence other than the testimony of the protagonists, each with an interest to serve.  In such a situation, there will be little or nothing for the fact-finding judge to go on apart from demeanour.”

7.  In EPI Environment Technologies Inc & Anor v Symphony Plastic Technologies plc & Anr [2005] 1 WLR 3456, 3470-3471 at para 74, Peter Smith J emphasized that it is essential to have regard to the entirety of a witness’s evidence.  As he observed, witnesses can make mistakes, but the mistakes do not necessarily affect other parts of their evidence.  Likewise, witnesses regularly lie.  However, lies themselves do not mean necessarily that the entirety of that witness’s evidence is to be rejected.  A witness may lie in a stupid attempt to bolster his case, but the actual case may nevertheless remain good irrespective of the lie.”

40.  The defendant’s pleaded case is that before 14 June 2010 Mr. Tam had on behalf of the plaintiff promised the defendant to repair the Rooftop.  Mr. Tam categorically denied having ever made such a promise.

41.  In his closing submissions, Mr. Cheung, Counsel for the defendant, characterized Mr. Tam as a breathtakingly poor witness who stumbled at almost all questions on the important details of the plaintiff’s case and that the difficulty he had in answering many of the questions asked in cross examination reflected his attempts to avoid the questions.  Mr. Cheung gave a number of examples to support his criticism of Mr. Tam’s evidence.

42.  Admittedly, Mr. Tam’s overall performance in the witness box was hardly satisfactory so much so that Mr. Ng, Counsel for the plaintiff, in defending the credibility of this witness, suggested as a reason for his poor performance that this witness was merely unintelligent. However, Mr. Tam was firm in denying having ever promised the defendant to repair the Rooftop.  It is true that at one point during cross examination he had said the defendant had asked him to try to find a replacement rooftop for him and, when the defendant told him to proceed with the Repair Works, he told the defendant he would try his best to find a replacement rooftop made by the original manufacturer.  In the same series of answers, however, Mr. Tam stressed he had not given the defendant his promise to find a replacement rooftop or guaranteed the defendant that a replacement rooftop could be found.  More importantly, he was adamant that he had not given a verbal undertaking to repair the Rooftop for the defendant.  While one may see some inconsistency in his testimony, he had consistently maintained that he had not promised to repair the Rooftop.

43.  Mr. Cheung hightlighted the discrepancy between Mr. Tam’s witness statement and his oral evidence as to how he came up with the records in the Job Card on 10 February 2010.  Mr. Tam’s spontaneous answer in correcting the contents of his witness statement in this regard, however, suggests a mere failure of his lawyer to correctly present in the English language the nitty-gritty of his practice.  In any event, the discrepancy here is not such as to cast any doubt on the overall credibility of the witness.

44.  As to the other instances cited by Mr. Cheung, such as whether the plaintiff was involved in arranging relicensing of the Vehicle for the defendant, whether Mr. Tam had requested the defendant to place a 50% deposit, whether the defendant had financial difficulty in paying a deposit, whether the defendant had been avoiding Mr. Tam between late 2010 and early 2011 and whether the defendant had never replied regarding the Third Costs Estimation, I do think Mr. Tam’s answers (or his failure to stand by what he said in his witness statement in relations to some of these matters) were such as to warrant the criticism leveled at him.  In any event, these matters have very little bearing on the key issue.

45.  On the other hand, the defendant’s evidence on whether Mr. Tam had promised him to repair the Rooftop hardly merits compliment.    For one thing, the defendant’s pleaded case as to how the alleged contract terms were formed before 14 June 2010 is most unclear.  In his evidence in chief, the defendant made no attempt to clarify the same. 

46.  Objectively speaking, the only reference in the costs estimationstouching upon the Rooftop is containedin the Remark.  If Mr. Tam and the defendant had reached any verbal agreement on repair to the Rooftop, the most likely timing must be 13 March 2010 when Mr. Tam called the defendant to seek the latter’s approval of the First Costs Estimation.  Indeed, when asked about the contents of his telephone conversation with Mr. Tam on the Second Costs Estimation in May 2010, the defendant said he had no impression of anything particularly important and wondered if it was appropriate to talk about the Rooftop on that occasion anyway. 

47.  As to the contents of the telephone conversation of 13 March 2010, as Mr. Ng rightly observed, the defendant had said nothing whatsoever about the same in the Defence or his witness statement.  In particular, he did not specifically say Mr. Tam had promised him to repair the Rooftop on 13 March 2010.  In cross examination, the defendant initially admitted that he could not remember the details of the telephone conversation.  When being pressed for an answer, the defendant gave answers where were at best equivocal, if not evasive.  It is interesting to note that, apart from vaguely asserting that Mr. Tam had promised to look for a replacement rooftop for him, the defendant had to resort to negative parlance and averred that between March and June 2010 Mr. Tam had never said he would definitely be unable to find a replacement rooftop for him.  When further taxed for an answer on the same topic, the defendant simply retorted by saying Mr. Tam never said there was anything he would surely be able to fix.[8]

48.  From the defendant’s answers alone, one is able to conclude that it is more likely than not that Mr. Tam had never promised the defendant to repair the Rooftop at the material time. 

49.  In coming to this conclusion, I observe that:

(1)    The First Costs Estimation did not contain any quotation of costs for fixing the Rooftop. Prices quoted there relate only to the repair of other parts of the Vehicle. 

(2)    In the Job Card, Mr. Tam put down in Chinese: “報價可以開工” which I take to mean the quoted items could be proceeded with.  The Rooftop was not a quoted item in the First Costs Estimation.

(3)    At the top of the Job Card, Mr. Tam put down “30 April 1800 hrs” as the tentative date and time for delivery of the Vehicle (to the defendant).  Had the repair of the Rooftop formed part of the contract as evidenced by the First Costs Estimation, one wonders why Mr. Tam would have put down such an early date, even if a tentative one, when he had just been notified by the parts department that production of the electric sunroof assembly had ceased.

(4)    It was the plaintiff’s parts department (and not service consultants like Mr. Tam or even Mr. Lee) which was responsible for sourcing parts.  As at 13 March 2010, it would be most unlikely for Mr. Tam to have committed to anything about the Rooftop.

(5)As it turned out, upon the defendant insisting on having the Rooftop fixed as a condition to taking delivery of the Vehicle, Mr. Lee (whose evidence I accept without hesitation) and his colleagues managed only to find a service provider who could tailor-make a rooftop to replace the original one.  This shows the plaintiff’s (and not just Mr. Tam’s or the parts department’s) inability to find even a ready-made replacement rooftop, whether from the original manufacturer or alternative sources.  One wonders if Mr. Tam could have confidently promised the defendant to find a replacement rooftop or repair the Rooftop back in March to June 2010.

50.  In the light of the above, I find it most unlikely for Mr. Tam to have promised the defendantto repair the Rooftop whether on 13 March 2010 or at any time before 14 June 2010. I accept that the defendant’s intention in towing the Vehicle to the Aberdeen Branch for repair was to have, inter alia, the Rooftop repaired.  He might well have asked Mr. Tam to try to find a replacement rooftop so that the Rooftop could eventually be fixed while giving approval for the Repair Works  (without which the Vehicle would not be rendered safe to use) to proceed in the meantime.  I find against the defendant, however, insofar as his case is that Mr. Tam had at the material time undertaken on the plaintiff’s behalf to repair the Rooftop.

51.  During the telephone conversation between Mr. Tam and the defendant on 13 March 2010, which was in all probability an informal discourse with the language used being less than precise, Mr. Tam might have said he would his best endeavour to look for a replacement rooftop for the defendant.  This, however, could at most amount to an agreement to agree rather than a contractual undertaking. 

52.  The defendant emphatically said in court that he would not have agreed to the First and Second Costs Estimations had Mr. Tam told him it was possible for the plaintiff to repair the Rooftop.  Surely it must have occurred to the defendant that Mr. Tam, assuming he had said he would try his best to look for a replacement rooftop, might at the end of the day fail to find one for the 17-year-old convertible car when production of the relevant parts had ceased.  Whether the defendant might have come to a different decision on repair is neither here nor there when his case is not that Mr. Tam had misrepresented to him the availability of a replacement rooftop thereby procuring his agreement to the Repair Works.  All Mr. Tam had said, according to the defendant, was that he needed time to look for a replacement, which was nothing but a contingency. 

53.  In the course of trial, it became clear that, in asserting that repair of the Rooftop was part of the contract between the parties, the defendant took theposition that, irrespective of the number of costs estimations or quotationspresented by the plaintiff, there was only one contract between the parties, that is, one that covered the repair of the Rooftop.  Hence Mr. Cheung’s submission that the plaintiff must fully perform the entire obligation of the contract in order to be entitled to payment.

54.  For there to be an entire contract, as Mr. Ng submitted, there has to be a contractual term for the doing of a specific work for a specific lump sum: Cutter v Powell (1975) 101 ER 573.  The contract amount under the First Costs Estimation (or that of the Second Costs Estimation which the plaintiff has practically waived) did not include the price for repairing the Rooftop.  It was never the defendant’s case that the plaintiff had agreed to complete all necessary repair works, including repair of the Rooftop, at any lump sum, whether as shown in the said costs estimation(s) or in the sum of $400,000 which the defendant said was the budget he had in mind but never made known to Mr. Tam.  Even in the defendant’s own case, there was no agreement whatsoever amounting to an entire contract.

55.  The defendant’s position was in any event contradicted by his own evidence.  It was not in dispute that Mr. Tam had sought the defendant’s tentative agreement to his suggestion before coming up with the Second Costs Estimation.  The defendant was well aware of the plaintiff’s practice to present to customers costs estimations for proposed repair works.  When approving the Second Costs Estimation, the defendant had yet to decide whether to re-spray the entire body of the Vehicle as he would like to wait and see if mere waxing would suffice.  It is therefore abundantly clear that the contractual relationship between the parties was to be founded on the costs estimations prepared by the plaintiff and each such costs estimation would either form a distinct contract or otherwise evidence the contract between the parties.

56.  I find as a fact that the contractual relationship between the parties herein was founded upon the items with quotation of repair costs in the First and Second Costs Estimations. 

57.  As to the Consolidated Costs Estimation, I accept the plaintiff’s evidence that it was meant to consolidate the first two costs estimations albeit with additions, variations and further discounts which would have amounted to a variation of contract had the defendant signed and agreed to the same.  As it turned out, the Consolidated Costs Estimation never formed the basis of the parties’ contractual relationship.

58.  As regards the Third Costs Estimation, it was a new proposal and offer from the plaintiff for resolving the standoff between the parties regarding the Rooftop (or at most a contract proposal following an earlier agreement to agree).  It is trite law that a party may prescribe a mode of acceptance of his offer: Chitty on Contract (13^th ed) Vol 1, at §2-065.  The plaintiff was entitled to require the defendant to sign the Third Costs Estimation to signify his agreement thereto before putting a non-Jaguar rooftop on the Vehicle.  In this connection, one would recall the plaintiff had previously required the defendant to sign the Consolidated Costs Estimation to signify his agreement thereto and was no longer content with contracting with the defendant orally.  As the defendant had failed to sign the costs estimation as requested, no contract was formed for repair of the Rooftop.  In any event, whether a contract was formed between the parties on the basis of the Third Costs Estimation has no bearing on the plaintiff’s entitlement to the Repair Costs.

59.  In the Telephone Record, there is an entry of 23 September 2011 recording the defendant to have said to the effect that no further authorization from him would be required for the plaintiff to carry out any other repair to the Vehicle and that repair to the Rooftop was a must.  That took place well before the Third Costs Estimation was sent to the defendant.  There is no further entry showing any subsequent telephone conversation between the defendant and the plaintiff’s staff after the Third Costs Estimation was sent to the defendant.  In cross examination, however, the defendant vaguely suggested that he had after receipt of the the Third Costs Estimation told Mr. Tam to proceed with the proposed repair.  Suffice it to say, the ambivalence of the defendant’s answers to Mr. Ng’s questions went no way in making out a case of oral acceptance of the plaintiff’s offer set out in the Third Costs Estimation.  Quite the opposite, he had apparently slept on the matter for yet another 10 months until he received the first letter from the plaintiff’s lawyer in August 2012.  The defendant said the Vehicle was dear to him and denied having lost interest in the same.  Instead of endearment, however, what was demonstrated was a deplorable lack of dispatch in rendering the Vehicle roadworthy again.

60.  Having completed the Repair Works, the plaintiff is entitled to payment of the outstanding Repair Costs in the sum of $277,184.10.

Were all relevant repair works other than repair of the Rooftop completed by October 2010?

61.  It should be noted that in his homemade defence, the defendant stated that “the plaintiff is only entitled to the balance of the costs of repairs on completion of the repair work…At this moment, according to Mr. Tam the only outstanding repair work is the canvass roof top.”  No challenge was raised regarding the plaintiff’s assertion that the Repair Works (excluding any repair to the Rooftop) have been completed.  By the same token, the defendant never sought discovery of the plaintiff’s documents in relation to the repair of the Vehicle or the alleged completion thereof.

62.  At trial, however, Mr. Cheung had extensively cross-examined the plaintiff’s witnesses on this topic and cast doubt on the plaintiff’s assertion.  He also questioned the plaintiff’s failure to adduce in evidence the repair note which Mr. Tam reportedly received from the workshop for the purpose of issuing invoices to customers.  He further attacked the inadequacy of the records entered by repair workers at the back of the Job Card.  He also raised doubts by reference to what appeared to be newly added items in the Consolidated Costs Estimation.

63.  While the documentary evidence of the plaintiff adduced herein understandably attracted criticism, both Mr. Tam and Mr. Lee firmly testified that all repair works quoted under the First and Second Costs Estimations were completed by 25 October 2010. Their evidence remained unshaken despite the skillful cross examination by the defence counsel.  In particular, Mr. Lee highlighted the fact that the Vehicle was a special case as it had been with the plaintiff for over three months and that he had personally monitored the progress of repair and had personal knowledge of the completion of repair by 25 October 2010.  He fairly acknowledged the absence of an entry in the Job Card recording the completion of repair.  But he also pointed out the fact that the education level of repair workers was low and he had not required them to record everything in the Job Card.  On the other hand, the Job Card shows a tester’s signature dated 17 January 2011 which suggests that the Vehicle was tested on that date (that is, around the same time when Mr. Lee issued letters to notify the defendant of the completion of repair).  Mr. Lee said there must have been an earlier test or quality control test one week before 25 October 2010 and he ordered a fresh test in January 2011 in view of the lapse of time.  The Job Card also shows the Vehicle had undergone a 4-step waxing process on 12 November 2010.  One wonders why the plaintiff would have bothered to wax a vehicle if it was still under repair. All these support the plaintiff’s case on completion of repair. 

64.  In this connection, I note further that the very first entry in The Telephone Record shows Mr. Tam to have spoken to the defendant at 1400 hrs on 29 October 2010 when the latter agreed to send to the plaintiff the registration document of the Vehicle for the purpose of government inspection.  For one thing, this supports Mr. Tam’s evidence that he had reported the completion of repair to the defendant.  More pertinently, if the plaintiff had not completed all relevant repair works (other than repair to the Rooftop), why would the subject of government inspection have come up?  Mr. Tam said under cross examination that the Vehicle could be sent for government inspection even without the Rooftop being fixed as it would not affect the structure of the Vehicle.  Whether he was right in believing so or otherwise, the plaintiff’s moves since 29 October 2010 as recorded in the Telephone Record do tend to support the plaintiff’s position. 

65.  Regarding the veracity of the Telephone Record, while the brevity of a number of entries may leave room for interpretation, I agree with Mr. Ng that there was nothing to show Mr. Tam was making up what he recorded in the Telephone Record. Indeed, the defendant had confirmed the contents of some of the entries such as the ones recording the defendant to have said he had to attend to funeral matters and was therefore unable to respond to the plaintiff.

66.  Mr. Cheung had also cross-examined the plaintiff’s witnesses extensively on the Consolidated Costs Estimation and, on the basis of their answers, challenged the plaintiff’s case on completion of repair.  It is true that the fresh costs estimation contains new items such as the one for government MOT test and items which do not match (or exactly match) those in the first two costs estimations.  This may suggest the way the plaintiff presented their quotations, especially in cases where a need for additional repair works was identified after an initial costs estimation was provided to customers, leaves a lot of room for improvement. I however accept the explanations of the plaintiff’s witnesses regarding the discrepancies identified in the Consolidated Costs Estimation.  In any event, such discrepancies were not such as to cast doubt on the plaintiff’s case that all relevant repair works were completed by 25 October 2010 and the Vehicle has since been ready for collection by the defendant.

67.  In conclusion, I find the plaintiff to have proven its claim for the Repair Costs against the defendant.

Whether the plaintiff is entitled to storage/parking costs as claimed or otherwise

68.  There can be no dispute that the defendant was obliged to collect the Vehicle within a reasonable period of time after having been notified of the completion of repair.

69.  As Mr. Ng put it in his closing submission, the plaintiff’s claim hereunder rests on the basis that by the defendant’s refusal to collect the Vehicle from the plaintiff, the relationship of bailor and bailee in respect of the Vehicle is created as a matter of law under which the plaintiff as a bailee has no choice but to take such measures to preserve the Vehicle as a man of ordinary prudence would have done, and accordingly there exists a correlative right to charge the defendant as a bailor such expenses as are reasonably incurred in fulfilling that duty. Reference was made to Goff & Jones, The Law of Unjust Enrichment, 2011, §§18-50 to 18-60, Great Northern Railway Co. v. Swaffield  (1874) L.R. 9 Ex 132, and China Pacific SA v. Food Corporation of India [1982] AC 939. 

70.  In the present case, it should be noted that the plaintiff had never pleaded a contractual basis for charging storage/parking fees other than setting out the facts giving rise to such a claim.  There is in fact a clause in the terms and conditions at the back of the plaintiff’s standard costs estimation forms which provides for a holding fee of $500 per day in the event a customer fails to collect his vehicle within two days after being notified of the availability of his vehicle for collection.  As the defendant’s attention was not drawn to this term, the plaintiff chose not to base its claim for storage/parking fees on the same.  By reason of the questions Mr. Ng put to the defendant during cross examination, however, Mr. Cheung was led to believe the plaintiff’s case in this regard was one based on contract or acceptance by conduct and had in his closing submission put forward arguments along this line.  It turned out Mr. Ng sought to justify the plaintiff’s claim for storage/parking fees on the bailment created as aforesaid.

71.  Before me, Mr. Cheung had no dispute with the legal principles and authorities cited by Mr. Ng but he objected to the plaintiff’s reliance on the same because of its failure to plead.  Reliance was placed on Kwok Chin Wing v 21 Holdings Limited (FACV 9/2012), unrep., 30 September 2013 and Sit Yiu Kwong v Ng Fung Cha, Kathleen (DCCJ 1916/2011), unrep., Judge Wilson Chan, 7 November 2013. 

72.  In this regard, I agree with Mr. Ng that the plaintiff is entitled to rely on the concept of bailment as the plaintiff is only required to plead facts, not law.  In Drane v. Evangelou [1978] 1 W.L.R. 455 at 458, Lord Denning had this to say:

“ Counsel for the defendant submitted that that claim was for breach of a covenant for quiet enjoyment. He cited a passage from Woodfall on Landlord and Tenant 27th Ed (1968) para. 1338. "Since the claim is in contract, punitive or exemplary damages cannot be awarded." The judge at once said : “What about trespass? Does the claim not lie in trespass?” Counsel for the defendant urged that trespass was not pleaded. The judge then said: “The facts are alleged sufficiently so it does not matter what label you put upon it.” The judge was right. The plaintiff in the particulars of claim gave details saying that three men broke the door, removed the plaintiff's belongings, bolted the door from the inside: and so forth. Those facts were clearly sufficient to warrant a claim for trespass. As we said in Re Vandervells Trusts ([1974] 3 All ER 205 at 213, [1974] Ch 269 at 321, 322): ‘It is sufficient for the pleader to state material facts. He need not state the legal result. If, for convenience, he does so, he is not bound by, or limited to, what he has stated. He can present, in argument, any legal consequence of which the facts permit.’

73.  That only materials facts rather than law must be pleaded was re-affirmed by the Court of Final Appeal in Kwok Chin Wing, supra.  The appellant there was unable to base his case on the new basis put forward by his counsel at trial not simply because he had failed to plead the legal basis but because he had failed to properly plead the material facts that might support such a legal argument. See §19 of the judgment of the Chief Justice and Hong Kong Civil Procedure 2014 §§18/7/4 and 18/11/1.  HH Judge Wilson Chan’s comment in paragraph 44 of his judgment in Sit Yiu Kwong, supra, should be understood in that light.

74.  The basic objective of pleadings is fairly and precisely to inform the other party in the litigation of the pleading party’s case so that proper preparation is made possible.  Here, while the plaintiff’s pleadings may leave room for improvement, the plaintiff has in my view adequately informed the defendant of its case, that is, the defendant’s failure to collect the Vehicle after completion of repair has obliged the plaintiff to keep the Vehicle in its parking facility and the plaintiff is claiming against the defendant storage/parking fees as from February 2011, three months after completion of repair.  Fully aware of this stance of the plaintiff, the defendant stated in his Defence that “the Plaintiff is not entitled to (storage/parking fees) because of non complete performance of the work required”.  Implicit in this averment must be an acknowledgement that the plaintiff would be entitled to such fees if the work had in fact been completed.

75.  The defendant should have collected the Vehicle within a reasonable period after 25 October 2010.  By any measure, an allowance of three months would be more than reasonable.  The plaintiff is therefore entitled to charge storage/parking fees as from 1 February 2011.  The plaintiff’s subsequent offers in terms of the Consolidated Costs Estimation and the Third Costs Estimation were not accepted by the defendant and no fresh contract (or variation of contract) was formed on the basis of the same.  They therefore could have no effect on the plaintiff’s entitlement under this head.

76.  Swaffield was recently affirmed by the English Supreme Court in ENE Kos 1 Ltd v Petroleo Brasileiro SA (No 2)[2012] 2 AC 164 where Lord Sumption JSC (with whom Lord Walker of Gestingthorpe JSC agreed) analyzed the basis of the judgments in Swaffield at page 178 as thus:

“ The true basis of the judgments in Swaffield was that where the property was originally bailed under a contract of carriage and the carrier had no choice but to remain in possession after the contract had ended, the existence of a continuing duty to care for the cargo was a sufficient basis for imposing on its owner an obligation to pay.”

77.  I see no reason why the same principle should not apply to a case where a car repairer finds himself obliged to keep in his safe custody a vehicle for repair due to the customer’s failure to collect the vehicle within a reasonable period of time after completion of repair.

78.  Lord Sumption JSC also held that a bailee in such circumstances could either make a claim for expenses actually incurred or a claim for remuneration for having stored and handled the bailor’s goods with his own facilities, the associated opportunity cost being a true cost even if not an out of pocket expense. 

79.  There is, however, a problem with the daily rate of $500 claimed by the plaintiff by reference to the hourly rate instead of monthly rate of nearby carparks on the ground that the plaintiff had no idea as to when the defendant might come to collect the Vehicle.  According to the authorities, only reasonable costs or remuneration would be allowed.  A daily rate of $500 would translate into a monthly parking fee of $15,000, which can hardly be reasonable.  Uncertainty as to when the defendant might collect the Vehicle is neither here nor there when the question of reasonableness falls to be considered. 

80.  In Petroleo Brasileiro SA (No 2), the court made an award for the opportunity cost of the bailee by reference to the market rate/value of the facility occupied by the bailor’s goods.  In the present case, on the limited evidence as to the hourly rate of nearby carparks and doing the best I can, I reckon that a monthly storage/parking fee of $3,000 would be a reasonable sum to compensate the plaintiff for keeping the Vehicle in its own facility. 

81.  Mr. Ng submitted that a duty to mitigate on the plaintiff’s part did not arise until its acceptance of the defendant’s repudiation of contract by commencing the present action in October 2012.  This I agree.  Mr. Lee was justified in not removing the Vehicle from the plaintiff’s own facility for the reasons he gave, at least until the commencement of this action. 

82.  I therefore find the defendant liable to pay to the plaintiff a storage/parking fee at the monthly rate of $3,000 for the period from February 2011 to October 2012 ($3,000 x 20 months), totaling $60,000.  As monthly parking fees should normally be paid in advance, no pro rata deduction for the month of October 2012 is required.

83.  As from the commencement of this action, however, I am of the view that the plaintiff should have mitigated its loss by moving the Vehicle as soon as practically to Chi Fu Fa Yuen Car Park which has been charging a relatively low fee for each of the 40 odd car parking spaces rented by the plaintiff for storing its stock cars.  Back in 2012, the monthly rate for each car parking space was $900 which was increased to $1,000 as from 1 July 2013.  The defendant should therefore pay to the plaintiff a sum of $7,200 for the 8 months from November 2012 to June 2013 and another sum of $12,000 for the 12 months from July 2013 to June 2014. 

84.  The defendant shall further pay to the plaintiff storage/parking fees at the rate of $1,000 per month from July 2014 onward until the month when the Vehicle is permanently removed from the plaintiff’s custody.  Again, no pro rata deduction shall be required for the month in which the Vehicle is removed from the plaintiff’s custody.        

Order

85.  I order that the defendant do pay to the plaintiffs:

(1)    the sum of $277,184.10 with interest at judgment rate from the date of writ until judgment and thereafter at judgment rate until payment;

(2)    the sum of $79,200 with interest at half judgment rate from 1 February 2011 until judgment and thereafter at judgment rate until payment; and

(3)    further storage/parking fees at the monthly rate of $1,000  from July 2014 onward until the month when the Vehicle is permanently removed from the plaintiff’s custody.

86.  There be an order nisi that the defendant do pay the plaintiff’s costs of this action, to be taxed if not agreed with a certificate for counsel.  The order nisi shall become absolute unless an application is made for variation of the same within 14 days from the handing down of this judgment.

87.  It remains for me to thank both Counsel for their assistance.