LOKUMAL & COMPANY (HONG KONG) LTD v. KARISON LTD

DCCJ 80/2016

[2018] HKDC 18

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 80 OF 2016

--------------------------

--------------------------

---------------------

JUDGMENT

---------------------

1.  The dispute of the parties centres around a contract for the supply of goods by the defendant to the plaintiff (“Agreement”). The Agreement is evidenced by a Sales Contract No. PI/14/1405 dated 26 March 2015 issued by the defendant to the plaintiff (“Sales Contract”). The plaintiff sent a Purchase Contract to the defendant on 31 March 2015, the terms of which were more or less the same as the Sales Contract.

2.  There is no dispute between the parties that a deposit of USD40,000 had been paid by the plaintiff to the defendant pursuant to the Sales Contract, and that the defendant had refunded part of the deposit in the sum of USD20,000 to the plaintiff.  The plaintiff is now claiming for the return of the balance of the deposit of USD20,000.

3.  The defendant claims that two separate orders were covered by the Sales Contract and the parties had only agreed to the cancellation of one such order.  The defendant counterclaims for payment of the balance of the price of the goods for one of the orders which had been produced but in respect of which the plaintiff had refused to take delivery.

4.  Both parties were legally represented at the initial stage of this action but have since filed Notice to Act in Person.  Mr Ramesh Mahtani represented the plaintiff while Mr Jadhwani Sunil (“JS”) represented the defendant.

Terms of the Agreement

5.  The Sales Contract is a one-page document with only a few terms typewritten on it.  The caption of the Sales Contract is “2X20’ CONTAINERS” and the very first term is “PS CIG”.  The quantity of the goods is specified as 1,000 cartons, with the more detailed description of “10 packs/shrink pack” and “50 shrink packs/master carton”.  It is not clear how many pieces of goods are in each pack, but with 10 packs in each shrink pack and 50 shrink packs in each carton, each carton should have 500 packs. The order of 1,000 cartons would mean 500,000 packs. 

6.  Approval of samples was provided for in the Sales Contract.  Delivery, where approval was required, was 2 weeks for making of samples and 3 weeks for production.  The term on loading in the Sales Contract is “in 2 containers each container 500 cartons plus the stock supplied in a Shenzhen warehouse”.  As regards payment, a 20% deposit in the sum of USD40,000 was provided for, with the balance to be paid upon “BL copy but within 3 days”.

7.  Although the parties have not referred to the terms of the Purchase Contract in their pleadings or witness statements, it is worth noting that the model number of the goods is stated as “CIG” in the Purchase Contract.  Further, the stock supplied in Shenzhen warehouse is indicated as glassware in the Purchase Contract. 

Defendant’s case

8.  In its Defence and Counterclaim (“DCC”), the defendant referred to the Agreement as being constituted by the Sales Contract and some other terms.  It pleaded that by the Sales Contract, the plaintiff agreed to pay for and the defendant agreed to supply 1,000 pieces of electronic cigarettes, defined as the “Goods” in the DCC, for the sum of USD200,000 FOB.  It then went on to plead that the Goods were to be delivered by 2 containers, each to contain 500 pieces of the Goods and to be shipped separately with time interval at least 2-3 months; and that the date of delivery, the port of loading and the destination port had yet to be confirmed because of custom matters in respect of the Goods both in China and the destination country.  There is no mention in the DCC as to how the terms not found in the Sales Contract were agreed upon, whether there was an oral agreement between the parties as well or otherwise.    

9.  The defendant then averred to the placing of an order to its supplier for the production of the Goods and the payment of a deposit of USD25,000 to its supplier.  It was alleged that upon the plaintiff’s approval of the sample of the Goods in May 2015, instructions for mass production of 500 pieces of the Goods (“First Lot”) were given by the defendant to its supplier, pending confirmation and instructions from the plaintiff for production of the remaining 500 pieces of the Goods (“Second Lot”). 

10.  It is further pleaded in the DCC that by the end of July 2015, the custom matters in relation to the Goods in China were solved.  The First Lot was then ready for shipment, pending confirmation and instructions from the plaintiff in relation to the date of delivery and the destination port.

11.  That remained unresolved by August or September 2015, and the plaintiff unilaterally cancelled the purchase of the Second Lot.  The defendant had no objection to such cancellation since mass production of the Second Lot had not begun.  The defendant refunded the deposit of USD20,000 for the Second Lot. 

12.  The defendant was informed of the clearance of the custom matters in the destination country by mid-October 2015.  However, despite repeated requests for confirmation or instructions in relation to the date of delivery and destination port for shipment of the First Lot, the defendant was only informed by email on 1 February 2016 that the destination port was Kingston, Jamaica and the name of the shipping company was Zim Line.

13.  According to the defendant, the plaintiff asked for immediate inspection of the First Lot by email of 3 February 2016.  The defendant informed the plaintiff that this could not be arranged because of the Chinese New Year holiday.  After the holiday, the defendant asked the plaintiff to arrange for inspection but they refused to do so.  The plaintiff told the defendant that its buyer did not need the Goods anymore. 

14.  The defendant counterclaims for breach of contract by the plaintiff in failing or refusing to take delivery of the First Lot or to settle the outstanding purchase price of USD80,000.

Plaintiff’s case

15.  In the Statement of Claim (“SOC”), it is averred that the defendant was in breach of the Sales Contract in failing to ship the goods ordered by the plaintiff according to the directions of the plaintiff.  Upon repeated requests and demands of the plaintiff for the full refund of the deposit money, the defendant only refunded a sum of HK$155,000 (equivalent to USD20,000 at the time of payment) on or about 26 October 2015.  The plaintiff is thus suing the defendant for the balance of the deposit in the sum of USD20,000, together with interest and costs.  There is no indication in the SOC as to what the goods ordered by the plaintiff were.

16.  In the Reply and Defence to Counterclaim (“Reply”) of the plaintiff, after stating that all the abbreviations and nomenclatures used in the SOC and the DCC were adopted, the plaintiff averred that it agreed to purchase the Goods in consideration of USD200,000 FOB.  According to the Reply, the Goods were to be delivered in one single lot and the defendant agreed to make samples for approval in 2 weeks’ time and to have mass production in 3 weeks’ time.    

17.  It is pleaded in the Reply that the samples had been made for two to three times but they were all disapproved for not being up to standard, and it was for this reason that the buyer of the plaintiff refused to wait for the shipment of the Goods from the defendant. The plaintiff alleged to have cancelled the entire order of the Goods and requested for the return of the full deposit since early June 2015. 

18.  The defendant only refunded USD20,000 to the plaintiff by way of a cheque.  At the time of such refund, the defendant promised to return the remaining USD20,000 within two weeks as they were short of funds then.  After the cheque for the sum of HK$155,000 (equivalent to USD20,000) had been cleared in October 2015, the defendant asked the plaintiff whether they could find any other items to buy from the defendant since the defendant was trying to find a way not to refund the balance of the deposit.  The plaintiff insisted on the refund of the balance of the deposit.

19.  Starting from January 2016, the defendant asked the plaintiff to help find a buyer of 500 cartons of the Goods as the defendant had already arranged for their production.  On 1 February 2016, the plaintiff asked the defendant to arrange for immediate inspection and shipment as its buyer was willing to take up the goods provided that there would be no further delay.  Upon learning from the defendant that the matter had to be delayed until after the Chinese New Year, the plaintiff’s buyer confirmed that they would not take up the goods.

20.  In the view of the plaintiff, the refund of USD20,000 and the promise to return the balance of the deposit of USD20,000 show that the defendant had accepted the cancellation of the entire order for the Goods by the plaintiff.  The plaintiff specifically denied, inter alia, that there were two lots of the Goods or that the First Lot was ready for delivery and shipment as early as end of July 2015.

21.  There is also an allegation that the defendant had failed to take reasonable steps to mitigate their alleged loss and damage, if it is found that the defendant did arrange for mass production of 500 cartons of the Goods and has therefore suffered loss and damages.

One Order or Two?

22.  Ahuja Sunil Ram Chandra (“Sunil”) is the central figure in this business transaction between the plaintiff and the defendant.  He was an ex-employee of the plaintiff.  Sunil made a witness statement on behalf of the defendant but was not called to testify at trial.  As the evidence he gave has not been subject to cross-examination, I cannot give any weight to it.  The defendant nonetheless asks me to take into consideration the documentary evidence disclosed. 

23.  The documents in the defendant’s list of documents are the emails exchanged between the parties from 31 March 2015 to 13 February 2016, the Sales Contract, the Purchase Contract issued by the plaintiff, the receipt showing payment of the deposit of USD40,000 by the plaintiff on 31 March 2015 and two sets of WhatsApp messages, one set between Sunil and JS for the period from 26 August 2015 to 14 December 2015 and the other set between Sunil and the wife of JS (“Rupa”) for the period from 18 February 2015 to 2 January 2016.

24.  Two witness statements were made in support of the plaintiff’s case, one by Aroon Mahtani (“AM”), a director of the plaintiff, and a second one by Mehta Hardik Kirikumar (“MHK”), its Financial Controller.  The witness statement of MHK was specifically made in response to the witness statement of Sunil.  Both AM and MHK were called as witness at trial. 

25.  During a large part of the time when the parties were engaged in communication relating to the matters pertaining to this action, neither AM nor MHK was directly involved.  They were supervising the work of Sunil when he was an employee of the plaintiff.  With Sunil not appearing in court, what happened back then during such period can therefore only be gathered from the documentary records of the parties.  Such records are however far from being complete.  For instance, the plaintiff has not produced documents showing the several rounds of sample approval, while the defendant has not produced any records of the terms of the Agreement that are not found in the Sales Contract, or the deal between the defendant and its supplier, whether in relation to the instructions given to such supplier for mass production of the First Lot, the deposit paid to such supplier or otherwise.  Even with the records made available, they are not without problems. 

26.  In respect of the two sets of WhatsApp messages produced by the defendant, MHK pointed out that the record was presented in the form of a text file which means that they could have been tampered with.  In his witness statement, MHK said the plaintiff’s lawyer would seek to request the screen capture of all the relevant WhatsApp exchanges to be produced by the defendant.  By an Order of HH Judge E Lee made at the Pre-Trial Review (“PTR”) on 22 September 2017, the parties were directed to attend trial with all the witnesses and all the original documents.  Not only was Sunil not called, the original WhatsApp messages were also not produced at trial.

27.  The decision not to present the WhatsApp messages in the screen capture manner does indeed raise a concern as to their authenticity.  Such concern has already been raised by the plaintiff in the witness statement of MHK.  There is also the direction made at the PTR for production of the original.  That notwithstanding, the defendant has not seen fit to provide any explanation as to why the screen capture had not been made available.

28.  Further, without the assistance of the sender or the recipient of those messages, there is no way to identify for sure which of the messages among the lengthy records relate to the business between the plaintiff and the defendant, and in what way.  For example, the goods mentioned in the exchange between Sunil and JS included glasses, rice, cigarettes[1] (as opposed to electronic cigarettes), T-shirts and deodorants[2].  The meaning of some of the messages is simply not discernible without the full background and context.  There are references to emails being sent as well but such emails have not all been produced.  All I can say is that there is more to this than what meets the eyes.  

29.  In any event, it is not clear how the messages can support the defendant’s case even if one is to just look at the contents of the WhatsApp exchange.  As mentioned, the messages shown in the exchange between Sunil and JS were from 26 August 2015 to 14 December 2015.  The earlier ones show that there had been discussions about whether the defendant could go ahead with the production of the goods.  Even if this message does relate to the supply of goods under the Sales Contract, it contradicts the claim in the DCC that the First Lot was ready for shipment by July 2015 already.

30.  There is a WhatsApp message which the defendant wants to rely on in particular, the one shown in the record as sent by Sunil to Rupa on 9 July 2015 which says “Hello please cancel one order”.  Again, the interpretation of this message is plagued with the same difficulties I have indicated above, especially when the earlier messages[3] show Sunil referring to the then potential business deal of 1000 cartons as “another” order, Rupa asking if there were a total of 3 orders and Sunil responding that there were 2 orders. In the absence of the messages prior to such exchange, it is not clear whether there were other unrelated orders that had been included in the counting. 

31.  The support that the defendant intends to draw from this message is put in doubt also because of two subsequent messages.  In a message sent on 13 July 2015, Sunil asked Rupa to transfer money to the account of Sunil’s company, which can mean the account of the plaintiff.  There is then a message on 15 July 2015 from Sunil to Rupa showing the conversion of USD40,000 to Hong Kong Dollars.  If the Sales Contract represents two orders and only one of these was cancelled, then Sunil should be working out the conversion of USD20,000 only.

32.  In addition, there can be no easy answer to the question as to which was the order to be cancelled in the message from Sunil to Rupa of 9 July 2015, whether it was the one single order, according to the plaintiff, or one of the two orders, according to the defendant, under the Sales Contract.  This is so because another message sent by Sunil to Rupa on 31 July 2015 which says “Need clear the first order and then next one…”, and also one sent by Rupa to Sunil on 12 September 2015 which says “Let this order go first”.  It would appear from these two messages that there were at least two orders still outstanding notwithstanding the cancellation of the one requested on 9 July 2015. 

33.  In the set of messages exchanged between Sunil and Rupa, the parties were still talking about approval of samples by the end of July 2015.  Hence, if the messages relate to the business covered by the Sales Contract, they also do not support the defendant’s case that the First Lot was ready for shipment by that time.

34.  For the reasons stated above, I do not find the WhatsApp messages to be helpful in resolving the disputes between the parties.  I will not take them into consideration.  That leaves the many emails produced by the parties.  The authenticity of these emails however is not beyond doubt.  I note that in some cases where a chain of emails is produced, some editing might have been carried out since details like the sender, recipient and the date of the emails under reply are not always shown. The following analysis of the evidence of the parties is therefore done against such state of affairs. 

35.  The defendant was introduced to the plaintiff by Sunil, its ex-employee, in March 2015.  The plaintiff terminated the employment of Sunil on 2 February 2016 on ground of his accepting advantage from other companies without the consent of the plaintiff. An acknowledgement to that effect was signed by Sunil on 2 February 2016. 

36.  In support of its claim that the whole contract was cancelled, the plaintiff has produced its communication with the defendant, including several emails dated between 15 June 2015 and 25 January 2016.  These emails show that the plaintiff had been asking the defendant to arrange for return of the deposit of USD40,000.  There is also an internal email from AM to MHK dated 30 October 2015, showing that the plaintiff was considering sending a legal letter to push the defendant to pay back the balance of the deposit.

37.  Several of the emails sent by the plaintiff in January 2016 were reminders to chase for the balance of the deposit.  On 13 January 2016, the defendant sent an email to the plaintiff, raising several matters to which Sunil, on behalf of the plaintiff, responded specifically by email on 14 January 2016.  The defendant firstly asked why the plaintiff was asking for a refund on the one hand, but sending the defendant a WhatsApp “to give the costing and ship the goods” on the other hand.  In his response, Sunil denied having sent any WhatsApp about costing and shipping.  He referred to the failure of the defendant to deliver the goods within stipulated time of three months from the date of the deposit payment and the cancellation of the order in October 2015.  Sunil also mentioned that the defendant was informed of the cancellation by email, the agreement and confirmation of the defendant to the cancellation, the return of 50% of the deposit and the promise to return the balance within 2 weeks’ time.  

38.  As to the defendant’s statement in the email of 13 January 2015 that the defendant had sent the deposit to its supplier and so could not cancel or return anyamount, Sunil pointed to the date of the order being 31 March 2015, the shipment date being 30-45 days and the end buyer of the plaintiff cancelling the order because they refused to accept the delay.  The defendant also pointed out that it was waiting for information of the consignee from the plaintiff so that the defendant could arrange shipping as the goods were ready.  Sunil’s reply was that there was no order to be processed or shipped till the above stage was cleared, and that the balance deposit was to be refunded without further delay.

39.  Documentary evidence relating to the plaintiff’s version about helping the defendant find a buyer for the 500 cartons of goods takes the form of a chain of email, first starting off as internal communication within the plaintiff (between Sunil and AM) and then an email was sent by Sunil to the defendant on 1 February 2016, with details of the shipping line and the port of destination.  The goods in question were however marked as T-shirts.  This is not the only email with T-shirts as caption and in none of the emails were electronic cigarettes mentioned as the goods to be sold and purchased. 

40.  Given that the plaintiff had agreed to the allegations in the DCC about the goods covered by the Sales Contract being electronic cigarettes, the relevance of the emails relating to the supply of T-shirts is in question.  When asked about it, AM testified to the contract being one for the sale and purchase of T-shirts and not electronic cigarettes at all.  He pointed to the code “PS CIG” marked on the Sales Contract and said that “CIG” was the brand name for the T-shirts to be manufactured. AM said he did not know what “PS” mean.

41.  This is a major departure from the case of the parties in terms of the goods being sold and purchased. When the parties were asked about this, none of them seemed to be nonplussed at all.  AM was also asked why their case that the goods to be supplied by the defendant were T-shirts and not electronic cigarettes had not been set out in the Reply.  His answer was that the plaintiff had told the lawyers about the goods being T-shirts.   

42.  Before me therefore is a potential preliminary issue of whether the parties had indeed made a contract when they were mistaken as to the goods being sold and purchased.  However, having considered the matter in detail, I find that there could not have been a mistake as to what the goods were.  

43.  In the first place, as much as the plaintiff wants to blame it on their lawyers, I do not consider it probable that the lawyers had gone so far off the mark.  The pleading that the goods were electronic cigarettes is paragraph 4(a) of the DCC.  That paragraph 4(a) of the DCC is denied in paragraph 3 of the Reply in such manner: “…save and except that the plaintiff agreed to purchase and the defendant agreed to sell the Goods in [the] consideration of USD200,000 FOB pursuant to the terms contained in a Sales Contract No. PI/14/1405 dated 26 March 2015”.  The lawyers would have taken specific and detailed instructions before they could draw up paragraph 3 of the Reply in the form as it is.

44.  AM was also asked about the absence of any specifications as to size in the Sales Contract.  He said the buyer of the plaintiff did not have any size specifications.  That is odd for an order for T-shirts of a particular brand name.  In paragraph 5 above, I have worked out that the order is for 500,000 packs of goods.  If the goods were really T-shirts, that means the order was for 500,000 T-shirts all of the same size.  That does not make sense from a sales perspective.   

45.  What I find to be most telling is the mention of the possibility of confiscation by customs in the email from Sunil to the defendant of 31 July 2015.  The relevant part is set out below:-

“The risk to us to ship all 1,000 cartons in one container is very high. The reason to ship in 2 containers is to reduce the risk in case the goods get confiscated in customs. Also, if we put all 1,000 cartons in 1 x 40GP container, then there will be very little space in the front of the container to put the glassware, which again means we are increasing the risk.”

46.  Sunil was explaining why the goods were to be shipped in two containers instead of one – to reduce the risk of confiscation and to have more space in the front of the container to put the glassware.  The need to have more space for the glassware in the front of the container was not for the sake of shipping more glassware, but for reducing “the risk”. 

47.  The goods covered by the Sales Contract are therefore something that would be at risk of confiscation at the port of destination.  T-shirts would unlikely be subject to such risk, but would be a handy code for referring to the goods by the parties.  This can also explain the reticence of the parties in spelling out what the goods were in the Sales Contract and the failure of the plaintiff to specify what the goods were in the SOC.

48.  It is therefore my finding that the goods to be sold and purchased under the Sales Contract were electronic cigarettes and not T-shirts.  There was no mistake as to what the goods were and the agreement made by the parties is valid.

49.  Next to consider is whether there were two orders for 500 cartons each or one order of 1,000 cartons under the Sales Contract.  As pointed out in paragraph 8 above, there is no mention in the DCC as to how the terms of the agreement between the parties that were pleaded in the DCC but not found in the Sales Contract were agreed upon, whether there was an oral agreement between the parties as well or otherwise. No further and better particulars have been requested by the plaintiff either.

50.  Apart from the very doubtful WhatsApp message referred to in paragraph 30 above, there is nothing in the documents before me which shows that the contract made was for 2 orders. Rather, the email from Sunil to the defendant dated 31 July 2015 referred to in paragraph 45 is consistent with the plaintiff’s case of there being only one order all along. 

51.  Further, that email is actually part of a chain of emails and there seems to be a later email from the defendant to the plaintiff dated 12 September 2015.  In this later email, the defendant stated that the goods would be ready in 3-4 weeks and the supplier would ship all 1,000 cartons in 40’ft HQ and they could not do 500 cartons per shipment.  This email shows the defendant itself was treating the 1,000 cartons as one order instead of two.

52.  In light of the evidence before me, I find that the agreement between the parties was for one single order of 1,000 cartons of the goods covered by the Sales Contract.   

Refund of Deposit

53.  Even though the agreement is for one single order, the plaintiff still has to show its entitlement to a refund of the deposit of USD40,000.  The plaintiff pleaded to have cancelled the agreement in June 2015 owing to the delay of the defendant for about 3 months in coming up with satisfactory samples.  I note the defendant had pleaded other terms of the Agreement, but there is no proof whatsoever of such other terms.  I am left with the Sales Contract only.

54.  There are two folds to the plaintiff’s claim for the refund of the balance of the deposit, one is the agreement of the defendant to refund the balance of the deposit when the USD20,000 was refunded to the plaintiff in October 2015, and the other is on ground of breach of the Agreement.  Apart from the self-serving email referred to in paragraph 37 above, there is no evidence to support the allegation of the defendant having agreed to refund the balance of the deposit.  In fact, all emails of the defendant show its reluctance to do so.

55.  What remains is the question of whether there had been a breach of the Agreement.  The delivery schedule provided under the Sales Contract was 2 weeks for approval and 3 more weeks for production.  There is nothing to suggest that time was not to run from the date of the Sales Contract.  Hence, the defendant should have completed production about 5 weeks after the date of the Sales Contract, sometimes in mid-May 2015. The earliest email showing the demand by the plaintiff for the return of the deposit of USD40,000 was dated 15 June 2015, four more weeks after the contracted time for delivery.  I have already referred to the evidence showing that the First Lot, not to mention all 1,000 cartons, was not ready for shipment even by July 2015. 

56.  There were indeed further emails to and from the parties on the matter.  The one from the defendant to the plaintiff on 29 October 2015 in particular was sent in reply to the email chasing for the deposit of USD40,000 from the plaintiff dated 19 October 2015. In that email, the defendant said it was waiting for the plaintiff’s other list of items of interest so it can clear out everything. 

57.  Another batch of emails to note are the ones between Rupa and AM in February 2016.  The plaintiff was still asking for the return of the deposit.  It was also referring to the need for a final answer at 5pm on 2 February 2016, seemingly relating to a request for inspection, but it never got one from the defendant.  There was also a later email from the plaintiff saying that the timing did not work and the plaintiff would try to offer the cargo to others.  The one sent by the defendant on 4 February 2016 specifically mentioned that the order having been confirmed since March 2015 and that the defendant had been waiting for the instructions for shipment delivery from the plaintiff.  To this, the plaintiff responded on 5 February 2016 saying that the statement of goods being ready in March 2015 was false.  Subsequent emails exchanged after the Chinese New Year holiday in 2016 more or less repeated the parties’ stances.

58.  The picture presented by the emails is one of the plaintiff having cancelled the Sales Contract by June 2015 and kept on chasing for the return of the deposit, firstly for the full amount and after the payment of USD20,000 in late October 2015, for the balance thereof.  Apart from that one email about considering other items of interest to the plaintiff which in itself did not amount to any commitment on the part of the plaintiff, there is nothing to show that the parties were in active discussions to vary the terms of the Sales Contract in terms of the late delivery of the shipment.  The exchange of emails in February 2016 are also more in support of the plaintiff’s case that it has agreed to help find other buyers, but without prejudice to its right to the balance of the deposit.

59.  That being the case, the position of the parties goes back to that under the Sales Contract.  I therefore find the defendant to be in breach of the Agreement.

60.  As noted in paragraph 26-001 of Vol 1 of Chitty on Contracts, 32^nd Ed,

“…Subject to a number of controls, the parties to a contract may themselves specify in their contract the remedy available to the innocent party following the other’s breach. In the absence of such “tailor-made” clause on the remedy, the law on damages fills the gap with “default” provisions on the assessment of money compensation which apply to all types of contract…The claimant is, as far as money can do it …to be placed in the same position as if the contract had been performed…”

61.  The remedy for breach had not been provided for in the Sales Contract.   In claiming for the return of the balance of the deposit only, the plaintiff is however not claiming for damages on the basis of what its position would have been had the Sales Contract been performed.  If the plaintiff had sourced the Goods from another supplier, it might have made a greater or lesser profit than what it would have made had the deal with the defendant been completed as scheduled; and subject to proof, the damages to be awarded may have to be adjusted accordingly.  If the plaintiff failed to source the goods elsewhere, it might have to pay damages to its buyers.

62.  Had the Sales Contract been performed, the plaintiff would have been paid by its buyer the re-sale price which, in the normal course of event, would cover the balance of the deposit of USD20,000.  The defendant has not advanced any case of the plaintiff making a greater profit, nor raised any challenge that the balance of the deposit would not form part of the damages the plaintiff would have sustained as a result of its breach of the Sales Contract.  The plaintiff should therefore be entitled to the balance of the deposit as damages for breach of the Sales Contract by the defendant.    

63.  For the reasons stated above, I dismiss the counterclaim and order the payment of the sum of USD20,000 by the defendant to the plaintiff, together with interest at the rate of 5% per annum from the date of writ to the date of judgment and thereafter at judgment rate until actual payment.

64.  On a nisi basis, I order the defendant to pay costs of this action, including all costs reserved, to the plaintiff, to be taxed if not agreed.