W M CONSTRUCTION LTD v. GOLDEN CHOICE ENTERPRISES LTD

HCA 1927/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1927 OF 2011

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BETWEEN

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DECISION

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1.  The plaintiff is a construction company and the defendant is a joint venture company established for the purpose of erecting nine small houses at a site at Wong Chuk Wan, Sai Kung in the New Territories.

2.  The defendant contracted with the plaintiff for the building of those houses for a sum of HK$10,880,000.  Another company, Ben Yeung Project Consultant Limited, was engaged as architect for the development.  There is a dispute as to whether the architect was the agent of the plaintiff or of the defendant.

3.  During the course of the contract, the plaintiff alleges that it was instructed to omit certain works but carry out additional works.  Its claim against the defendant is for the balance due on the contract as adjusted by the variations and additions.  The net sum claimed is HK$3,401,136.  It represents work done which has not been certified by the architect.  It is claimed that since February 2009, the defendant has prevented the plaintiff from gaining access to the site and carrying out any further work.  As a consequence, the plaintiff claims that the defendant has repudiated the contract, which repudiation the plaintiff has accepted.  In answer, the defendant alleges that it too has been ousted from the site as the result of a dispute between the parties to the joint venture, and is not therefore in a position to allow the plaintiff or the architect access to the site.  It denies that it instructed the plaintiff to carry out variation or additional works.

4.  The defence is a rambling, repetitive document, I regret to have to say, but the upshot is that the defendant contends that he is in more or less the same impotent state as the plaintiff.

5.  Against this stalemate, the plaintiff has taken out a summons under essentially Order 29 Rule 7A and section 42(2) of the Rules of the High Court to obtain leave to enter and inspect the site and, perhaps more pertinently, for the architect, whosever agent he may be or may not be, to enter for the purposes of certification of the disputed work.  It is also under the original contract due to carry out certain works once the certificates of compliance have been given.

6.  There is also a background of litigation involving the properties built on the site which came before Mr Justice Louis Chan in Hong Kong Miscellaneous Proceedings HCMP1760/2009, in which his judgment was delivered on 13 August 2010.  I have read this judgment.  It involved a number of lots of land, but the ones concerned in this action are those in schedule 1 of the judgment, viz Lots 281, 283-286, and Lot 85D, all in DD258.

7.  The action was brought by the defendant in this action and one of its joint venture partners against the other joint venture partner and 17 other defendants, being the registered owners of the lots of land which featured in that litigation, 17 lots in all, of which six or more are common to this piece of litigation of which I am having to consider but a single aspect.

8.  There appears to be some inconsistency in the number of houses erected or to be erected on the six lots - six houses in the other action and nine houses in this.  That is not likely to be material as far as the matter which comes before me is concerned.  Order 29 Rule 7A(2) provides for the service of a summons seeking an order under section 42(2)(a) in respect of property which is the subject matter of proceedings but which is not in the possession of any party to the proceedings on the person against whom the order is sought personally as well as every party to the proceedings.

9.  I am satisfied that this has been done. It is in the interest of both parties that the means of achieving a necessary stage in resolving this dispute should be provided.

10.  All the non-parties have now given consent to the plaintiff’s application.  The plaintiff’s affirmation indicates that the houses are unoccupied, so there will be no disruption to the owners. It is estimated that one day will afford sufficient time for the necessary assessment.

11.  Although the plaintiff has indicated that it wishes to instruct a particular architect, in my view, an architect must be appointed as the independent architect providing an impartial expert report for the benefit of both parties and the court.

12.  I therefore order that such an independent architect be appointed to do that by agreement between the parties.  If the parties cannot agree, they will have to return to the court for the court to decide which architect or who should be appointed as the independent architect to achieve that event.

13.  As far as the costs are concerned, an application is made for costs to be in the cause, and that seems to me to be the appropriate decision, and indeed, Ms Chong for the defendant I think is in agreement and certainly does not oppose it.