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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JUDGMENT
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1.  The plaintiff in this action claims the balance of the price of a contract carried out by it for the defendant joint venture company at a site in Sai Kung involving the construction of some small houses.

2.  A dispute involving the members of the joint venture led to the plaintiffs being prevented from having access to the site and therefore being unable to complete the contract.  No fault attaches to the plaintiff in this regard.

3.  The claim is for the difference between the contract price, less the cost of work which could not be carried out, plus the cost of extra work beyond the contractual works.  The net figure claimed is just over $3.4 million.

4.  The defence, such as it is, virtually conceded the merit of the plaintiff’s claim.  It admits that the plaintiff could not get access to the site to complete the agreed works and blames the plaintiff for not having the balance of its claim certificated by the architect, who also was unable to gain access so as to inspect the work and duly certificate the claim.

5.  It is well over two years since I made an order providing for an assessment of the work done and the valuation of it by an independent architect on behalf of both parties.  In a short decision I also criticised the form of the defence filed by the solicitors for the defendant.  It was repetitive, rambling and verbose and in fact disclosed no real defence on the merits.  It did the defendant company no service.

6.  Those solicitors ceased to action in May of this year (2015) and since then the defendant company has been on its own, somewhat adrift.  No director has sought leave to act on its behalf.

7.  When the papers came back before me a little while ago I noted that it was estimated to be a seven‑day trial.  That was a gross overestimate and I accordingly reduced it to a three‑days.  I had noted that the order of Madam Justice Bebe Chu provided that the architect’s joint report should stand as evidence without calling the maker.

8.  Furthermore nothing had emerged to cause me to change my opinion that the plaintiff was bound to succeed in its claim, albeit that the amount recoverable was about half of that claimed, in view of the valuation by the architect.

9.  If the action had continued the outcome was inevitable with, as a consequence, a considerable waste of cost and court time.  I therefore decided that it should be listed for Mention at 10 am on Wednesday 4 November 2015.  When called on, no one appeared for the defendant company.  Counsel appeared instructed by the plaintiff’s solicitors.

10.  It was clear that the defendant had not responded to recent letters from the plaintiff’s solicitors and had similarly not replied to the court’s last two letters.  Although I was minded there and then to enter judgment for the plaintiff, I decided, having discussed the situation with counsel for the plaintiff, to leave the case listed for trial starting on 5 November 2015, the next day, in case anyone from the defendant appeared.  It was to be listed with a direction that no witnesses were to attend.

11.  Today, 5 November 2015, the defendant company did not attend in any shape or form and so I entered judgment for the plaintiff for the sum of $1,650,238HKD being the lower of the two valuation figures of the architect, with costs to be taxed.  Interest on this sum will be at the rate of five percent from the date of issue of the writ to the date of judgment ie today, and thereafter at the judgment rate of eight percent.

12.  I make it clear that had the plaintiff proceeded by way of summons for judgment under Order 14 after the valuation report from the jointly instructed architect was available, I would have made such an order in favour of the plaintiff then.  That course would have achieved a not insignificant saving in costs.

13.  Yesterday Mr Kwong for the plaintiffs had told me of the sanctioned offer contained in a letter dated 31 July 2015 and would be seeking an order for indemnity costs subsequent to that date.  However the defendant had been without legal representation since early May this year and I am not satisfied that it, through its director, would have understood the full implications of this letter.  In any event the likely taxed costs will be out of proportion to the nature of the case.  Therefore I decline to make any order on the strength of that letter.