PROFIT LINK PROPERTIES LTD. v. HARBOUR VIEW LTD.

HCA 1610/1998

IN THE HIGH COURT OF

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF THE FIRST INSTANCE

ACTION NO. 1610 OF 1998

__________

__________

__________________________

ASSESSMENT OF DAMAGES

__________________________

1. The Plaintiff is the registered owner of the premises known as Shop Nos. 213 and 215 on the 1st Floor of the Commercial Podium of New Mandarin Plaza, 14 Science Museum Road, Tsimshatsui, Kowloon ("the Premises"). By a tenancy agreement dated 15 May 1998, the premises were let by the Plaintiff to the Defendant for a term of 2 years commencing from 18 April 1997 at the monthly rent of $20,000 exclusive of rates, air-conditioning charges and management fee. On 9 January 1998, the Defendant gave notice to the Plaintiff in writing purporting to terminate the tenancy with immediate effect. The keys to the Premises were also surrendered at about the same time.

2. On 4 February 1998, the Plaintiff issued the Writ herein claiming for arrears of rent for the period from 18 December 1997 to 9 January 1998 and also damages for wrongful repudiation of contract. In default of Notice of Intention to Defend, final judgment for the arrears of rent and interlocutory judgment for damages to be assessed was entered on 13 March 1998.

3. At the assessment, the Plaintiff called a Miss Chung Po Ki who is the manager of the Plaintiff responsible for the letting of the Premises. She had also made 2 affirmations in support of the Plaintiff's claim for damages. The Defendant was absent.

4. I accept that the tenancy between the parties was for a fixed term with no provision for early termination by the Defendant. The Plaintiff is therefore entitled to claim for loss of rental occasioned by the Defendant's unilateral act of termination, subject to a duty to mitigate its loss. I accept from Miss Chung's evidence that the Plaintiff had endeavoured to re-let the Premises by putting up notices and engaging estate agents, but that no new tenant could be found as of the date of the assessment. The Plaintiff however is contented to claim for loss of rental up to 17 October 1998, but not for the whole of the remainder of the term. The period involved is about 9 months. Having regard to the evidence and the condition of the present property and letting market, I am satisfied that this head of the Plaintiff's claim has been made out.

5. The Plaintiff also seeks damages representing rates, air-conditioning charges and management fee. The claim for air-conditioning charges was abandoned in the course of the assessment as it is not clear as to how the rate was set. As to the claims for rates and management fee, these are all consequential loss arising directly from the Defendant's repudiation to which the Plaintiff is entitled. The management fee was initially set at $2,495 per month under the tenancy agreement. According to Miss Chung's evidence in Court, it was revised in January 1998 to $2,695 per month. The payment of the revised management fee and the rates are all evidenced by payment demands and receipts.

6. The Plaintiff is prepared to give credit for the rental deposit held and forfeited by it as well as the refund of rates made by the government. The amount which the Plaintiff is entitled to recover the Defendant is therefore as follows :-

(a)	Loss of rental at $20,000 per month from 10/1/98 to 17/10/1998	HK$	185,161.29
(b)	Management fee at $2,695 per month from 18/12/97 to 17/10/98		26,950.00

(c)	Rates From 1/1/98 to 31/3/98 From 1/4/98 to 30/6/98 From 1/7/98 to 30/9/98	$3,225.00 $2,902.50 $2,902.50		9,030.00
	Total :			221,141.29
Less (d)	Rental deposit	$67,485.00
	Refund of rates	2,902.50		70,387.50
			HK$	150,753.79 ==========

7. Accordingly, I certify that the damages which the Plaintiff is entitled to claim from the Defendant is in the sum of HK$150,753.79, together with interest thereon at judgment rate from the date of Writ to date of full payment. The costs of the assessment shall also be to the Plaintiff to be taxed.