Joytex Development Ltd v. Super Homes Ltd
Read the full judgment text of HCA 18/2012 on BabelCite. This High Court CFI judgment was delivered on 10 October 2018.
1. The trial of this action before me took place over five days ranging from 13 to 22 June 2018. The plaintiff (“ Joytex ”) was represented by Mr Mike S K Lui, and the defendant (“ SHL ”) was represented by Mr Kenneth K M Ho.
Cited by 16 cases · Cites 13 cases
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HCA 18/2012 [2018] HKCFI 2286 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO 18 OF 2012 ________________
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______________ JUDGMENT ______________ A. INTRODUCTION 1.The trial of this action before me took place over five days ranging from 13 to 22 June 2018. The plaintiff (“Joytex”) was represented by Mr Mike S K Lui, and the defendant (“SHL”) was represented by Mr Kenneth K M Ho. 2.Joytex claims against SHL for misrepresentation. The alleged misrepresentations relate to Joytex’s purchase from SHL of a flat in a residential development known as “The Icon”, located at No 38 Conduit Road, Mid-levels. 3.Joytex is a Hong Kong company incorporated on 27 March 2009, which purchased Flat 25A of The Icon (“Flat 25A”). In June 2009, Joytex was acquired by Mr Cheung Keng-ching (“Mr Cheung”) as a corporate vehicle for the purchase of that flat, with Mr Cheung as its sole director and shareholder, and Mr Cheung’s wife Madam Chou Mei (“Madam Chou”) as its secretary. 4.The defendant is a Hong Kong company, which was the developer of The Icon[1]. 5.The alleged misrepresentations relate to the question whether an open kitchen layout, as opposed to a closed kitchen layout, could be constructed at Flat 25A: see further below. 6.The misrepresentations are alleged to have arisen by implication from a number of different sources, principally: (i) certain brochures and other documents provided by an agent (“Ms Wong”) of Centaline Property Agency Limited (“Centaline”) to Mr Cheung and Madam Chou on 29 June 2009; (ii) Ms Wong’s statements and conduct on that date; (iii) statements made by a conveyancing clerk (“Mr Liu”) of a firm of solicitors (“the Solicitors”) on 8 July 2009; and (iv) a visit to a Centaline showroom in August 2009. 7.Joytex seeks: (i) rescission of the provisional sale and purchase agreement and formal sale and purchase agreement, including return of the purchase price paid for Flat 25A; and (ii) damages for fraudulent misrepresentation or under section 3 of the Misrepresentation Ordinance (Cap 284)[2]. A1. The Enclosed Kitchen Layout, the Open Kitchen Layout, and the Alleged Representations 8.The alleged representations are defined by reference to two different layouts for Flat 25A. The first layout (the “Enclosed Kitchen Layout”) features an enclosed kitchen which faces towards the main entrance door to the flat. The second layout (the “Open Kitchen Layout”) features an open kitchen in a different location, namely to the left of the main entrance door as a person enters the flat. 9.Although this point was not relied on or emphasised, the Enclosed Kitchen Layout is for a one-bedroom flat, whilst the Open Kitchen Layout is for a two-bedroom flat. 10.There are attached to this Judgment as Annexes I and II, plans depicting the Enclosed Kitchen Layout and Open Kitchen Layout, respectively[3]. 11.The representations which Joytex alleges to have been made, are as follows:
12.The first of these has been referred to as the “Intention Representation”, and the second to fourth as the “Compliance Representations”. During submissions, Mr Lui clarified that Joytex only alleged falsity of the Compliance Representations, not the Intention Representation. However, the fact of the Intention Representation formed part of Joytex’s case that that the Compliance Representations had been made. A2. Issues 13.The key issues can be characterised as follows:
B. EVIDENCE: GENERAL B1. Factual witness 14.Only one factual witness was called, namely Mr Cheung, for Joytex. Mr Cheung gave evidence on central events including of 29 June and 8 July 2009, and what was said by Ms Wong (of Centaline) and Mr Liu (the conveyancing clerk) on those occasions. 15.SHL called no factual witness. I heard no evidence from any witness from SHL or Centaline. Notably, neither Ms Wong nor Mr Liu wascalled. Accordingly, there was no witness to controvert Mr Cheung’s evidence including as to what occurred and was said orally on 29 June and 8 July 2009. B2. Mr Cheung’s credibility as a witness 16.The parties disagree as to Mr Cheung’s credibility. 17.However, during cross-examination, Mr Cheung’s factual account of what was said by Ms Wong on 29 June 2009 and by Mr Liu on 8 July 2009, was not challenged (or hardly challenged). 18.On these factual points, there is simply no serious evidence to controvert Mr Cheung’s. SHL filed a hearsay notice in relation to a letter dated 24 May 2012 from Centaline to SHL’s then solicitors. That letter (inter alia) denies that the Alleged Representations were made by Ms Wong or Centaline. However, it is simply a letter, on which I place no weight in Ms Wong’s absence. 19.Similarly, SHL filed a witness statement from Mr Liu, but he was not called. The parties agreed that the statement be expunged from the trial bundles. In any event, I would have placed no weight on the statement in Mr Liu’s absence. 20.On these factual points, Joytex invited me to draw inferences against SHL, from its failure to procure evidence from Ms Wong, Mr Liu or any other witness. The parties made detailed submissions on the drawing of inferences. 21.I do not consider it necessary to draw inferences, since even without so doing, I accept Mr Cheung’s evidence. I would record collaterally, however, that I do consider that the circumstances warrant the drawing of factual inferences against SHL. 22.The cross-examination of Mr Cheung was directed at other aspects of his evidence, notably: (i) his alleged trust of Ms Wong and reliance on her statements and presentation, in preference to reading the details of documents (such as qualifying wording in the brochures, and the detail of legal contracts); (ii) his evidence that the Open Kitchen Layout was a matter of significance to him in deciding to purchase Flat 25A; and (iii) his motivation for bringing these proceedings. 23.In essence, SHL argued that it was inherently incredible that a person with Mr Cheung’s business experience and sophistication would have relied on oral statements of a sales agent and/or a conveyancing clerk, when purchasing Flat 25A. 24.In short, I accept Mr Cheung’s evidence on these points also. I do not find the factual scenario to be as inherently incredible as SHL suggested, given the full factual context and status of the representers. This is discussed further below under Issue 2 on reliance. 25.Indeed, I found Mr Cheung to be a rather straight-forward witnesswhose credibility was not substantially shaken under cross-examination. Assubmitted by Mr Lui, there was at least one occasion on which he volunteered a concession against his interest. 26.Mr Cheung was cross-examined in respect of certain disqualification proceedings taken by the Securities and Futures Commission (“SFC”) against him and Madam Chou (see further footnote 5 below). Mr Ho, for SHL, did not address me in any detail on this topic, nor direct me to the relevant judgments and documents, though some appear in the trial bundles. Suffice it to say that in assessing whether to accept Mr Cheung’s evidence, I have taken this material into account, but it does not alter my conclusions. I note, for example, that there was no allegation of dishonesty in those proceedings. B3. Expert witnesses 27.I heard expert evidence from three surveyors, namely:
C. FACTUAL FINDINGS 28.Below, I set out my key factual findings. As to the events of 29 June and 8 July 2009, I rely principally on Mr Cheung’s evidence, which was essentially uncontroverted in this respect. C1. Mr Cheung and Madam Chou 29.Mr Cheung is the founder, former Chairman and former majority shareholder of Rontex International Holdings Limited[4] (“Rontex”), a company listed on the Main Board of the Hong Kong Stock Exchange. Madam Chou is a former executive director of Rontex. 30.Mr Cheung’s evidence was that in 2008 he sold most of his shares in Rontex. By the time of the relevant events, he and Madam Chou had both ceased to be executive directors of Rontex[5]. 31.Mr Cheung accepted, in essence, that he was an experienced and successful businessman, who in the course of his business had signed many legal documents. However, he denied that he was experienced in property investment. His evidence was that he can read and understand about 90% of a document written in English. 32.Mr Cheung and Madam Chou live in the vicinity of Conduit Road, where The Icon is located. C2. Centaline 33.Centaline was the sole agent for SHL, for the sale of units in The Icon. 34.Centaline’s appointment and duties as sole agent were set out in a Sole Sales Agency Appointment Agreement dated 13 February 2007 and a Supplementary Soles Sales Agency Agreement dated 25 June 2009. By those agreements, Centaline was responsible for promoting and selling units of The Icon in accordance with the provisions therein. C3. Events prior to 29 June 2009 35.At the start of 2009, Mr Cheung had spare funds having sold hisstake in Rontex. Mr Cheung and Madam Chou considered that it was a good time to invest in property, so made inquiries with some real estate agents. 36.This led to contact with Ms Wong of Centaline. Ms Wong showed Mr Cheung and Madam Chou certain flats which they did not buy, before introducing them to The Icon. The Icon was the only “uncompleted”flat to which Ms Wong introduced them. C4. 29 June 2009 37.On 29 June 2009, Mr Cheung and Madam Chou visited the Conduit Road branch of Centaline, and met with Ms Wong. She introduced them to The Icon, which was then under construction. At that time, they had known Ms Wong for approximately two to three months. 38.Ms Wong gave them each a copy of a brochure on The Icon (the “Centaline Brochure”). She used the Centaline Brochure to introduce The Icon and explain various features, including by directing their attention to the floor plans therein. 39.Ms Wong said, amongst other things:
40.Mr Cheung asked Ms Wong if he could modify the layout however he wished. Ms Wong answered that all walls could be removed except the structural wall. She added that the developer had confirmed that the walls could be removed and there would be open kitchen and that was why the floor plans in the Centaline Brochure were designed this way. 41.Ms Wong explained that units A and D were small units targeting families with one or two members to whom an open kitchen would be more attractive, thus the properties would be easier to sell. Since his purchase was for the purpose of investment, Mr Cheung therefore found the open kitchen design very attractive. 42.Mr Cheung asked if he could visit a show flat. Ms Wong replied that there was no show flat that could be visited. 43.Mr Cheung and Madam Chou decided to buy four units on one floor of The Icon. Ms Wong suggested buying through companies rather than in personal names, to facilitate purchasing and selling. Centaline had already prepared shell companies, so they bought four units using four different companies supplied by Centaline. C4.1. Provisional Sale and Purchase Agreements 44.Ms Wong and her colleague prepared Provisional Sale and Purchase Agreements for the four flats on the 25th floor. The first to be signed was for Flat 25A (the “PSPA”). Ms Wong explained the price and schedule of payments, and that the developer was represented by the Solicitors. If Mr Cheung and Madam Chou also engaged the Solicitors, the legal fees would be borne by the developer. 45.The PSPA is written in both English and Chinese. Mr Cheung was cross-examined on whether he read it, by reference to one of its clauses. His evidence, which I accept, is that he did not read it in detail before signing. C4.2. Free Legal Fee Letter and Warning to Purchasers 46.Next, Ms Wong gave to Mr Cheung two documents, which he signed on behalf of Joytex, namely:
47.When explaining the Warning to Purchasers, Ms Wong said that this was a transaction for first hand property and it was impossible to have any problems. The arrangement for joint solicitors was used by other developers, and could lead to considerable savings. On hearing this, Mr Cheung decided to engage the developer’s solicitors. C4.3. The 2009 Side Letter 48.Next, Ms Wong gave to Mr Cheung a letter (which has been referred to as the “2009 Side Letter”) which he signed on behalf of Joytex. 49.The 2009 Side Letter is a standard form letter addressed from the Purchaser(s) to Fairy Gold Limited. The details of the particular flat, purchaser and date are filled in by hand. The 2009 Side Letter states:
50.There are two floor plans attached to the 2009 Side Letter featuring the Enclosed Kitchen Design and the Open Kitchen Design respectively, which are at Annexes I and II to this Judgment. 51.When Ms Wong provided the 2009 Side Letter, she explained toMr Cheung that it was signed for the developer to convert the one bedroom in the original floor plan into two bedrooms and to construct an open kitchen. The developer would instruct its contractor to install fittings and finishes in accordance with List II rather than List I, at no extra cost to Mr Cheung. Ms Wong stated that developer had already made arrangements and engaged professionals to design the open kitchen. Therefore there would be no problems for any changes and it would be lawful. 52.Ms Wong said that signing the 2009 Side Letter was a formality. Mr Cheung signed and the date was written in later. He did not read it because he trusted Ms Wong. 53.Importantly, on 29 June 2009 Mr Cheung signed on behalf of Joytex a floor plan showing four units in The Icon with the Enclosed Kitchen Layout. Mr Cheung’s evidence was that he asked Ms Wong about this, who said that the signed plan was submitted by the developer, but when the transaction completed the developer would provide the open kitchen plan. C4.4. Conclusion of meeting 54.After signing documents for Flat 25A, Mr Cheung signed documents for flats B, C and D on the same floor, though there was no 2009 Side Letter for flats B and C. 55.Finally, Ms Wong gave to Mr Cheung two further brochures in respect of The Icon, which have been referred to as the “Joint Brochure” and the “Hong Fok Brochure”. C5. The Brochures C5.1. The Centaline Brochure 56.The Centaline Brochure contains marketing and sales information in relation to The Icon. It includes descriptive passages as to the surrounding area and development to be completed, colour photographs, artists’ impressions of the building and flat interiors, and descriptions of features and amenities. There is a certain amount of what may be described as sales hyperbole[7]. 57.The following features are particularly notable:
C5.2. The Joint Brochure and the Hong Fok Brochure 58.The Joint Brochure includes the following:
59.The Hong Fok Brochure[8]includes the following:
C5.3. SHL’s involvement in preparing the brochures 60.I am satisfied that the content of the brochures, including various depictions of the Open Kitchen Layout, was approved by SHL. Mr Lui referred me to certain emails between Centaline and SHL in respect of the content of brochures for The Icon. Further, the terms of the agency agreements (see above) and the content of the Panel Minutes (see below) support this conclusion. SHL adduced no contrary evidence. C5.4. Extent to which Mr Cheung read the brochures 61.Mr Cheung was cross-examined on the various “qualifying words” in the brochures, upon which SHL relies. His evidence was to the effect that he paid attention to the layout plans in the Centaline Brochure to which Ms Wong specifically directed him on 29 June 2009. However, he did not read any of the brochures in detail, and did not notice or pay attention to various “small print” or qualifying wording relied on by SHL (such as “for reference only”). I accept this evidence. C6. 8 July 2009 62.On 8 July 2009, Mr Cheung and Madam Chou visited the officesof the Solicitors, to execute formal Sale and Purchase Agreements for the four flats. They dealt with Mr Liu, a conveyancing clerk of the Solicitors. 63.During this visit, Mr Cheung was given by Mr Liu for his signature a floor planfeaturing the Enclosed Kitchen Layout. Mr Cheung noticed that it was different to the Open Kitchen Layout and asked Mr Liu about this. Mr Liu replied that that the floor plan was used for the formal Sale and Purchase Agreement, and he knew that the developer undertook to change the kitchens of units A and D into open kitchen. As long as the developer had undertaken to do so, he asked Mr Cheung not to worry and there would be no problem. 64.I will not here recite the detailed terms of the Sale and Purchase Agreement for Flat 25A (the “SPA”). Suffice it to say that the property sold is defined by reference to a plan depicting a floor of The Icon in which all four units have the Enclosed Kitchen Layout. 65.Mr Cheung was not cross-examined specifically as to whether he read the detail of the SPA, but I find on a balance of probabilities that he did not. C7. August 2009 66.In around August 2009, Mr Cheung was taken by Ms Wong to visit a showroom (or demonstration) for The Icon at the Conduit Road branchof Centaline. The showroom/demonstration featured an open kitchen layout for units A and D [10]. 67.Around October 2010, Mr Cheung on behalf of Joytex signed a letter from Joytex to SHL, referred to as the “2010 Side Letter”. It is a standard form letter, which reads:
68.Mr Cheung’s evidence on the 2010 Side Letter, was unchallenged. In October 2010, Ms Wong requested a meeting since the transactions were nearing completion. She told Mr Cheung that the developer had a proposal for purchasers to choose, namely that the developerwould not decorate the units, but would instead offer a bare shell for units A and D and give each purchaser HK$148,000 as compensation. Mr Cheung asked Ms Wong’s advice, who suggested that he take the compensation for one of the units but not the other. Mr Cheung agreed and signed the letter in respect of Flat 25A[11]. C9. Completion 69.The sale and purchase of Flat 25A completed on 17 December 2010, on which date Joytex paid to SHL the balance of the purchase price which was outstanding, and SHL executed an Assignment of Flat 25A to Joytex. The Assignment defined the property conveyed by reference to the same floor plan as annexed to the SPA, ie depicting the Enclosed Kitchen Layout. 70.In January 2011, Joytex received HK$148,000 from SHL, pursuant to the 2010 Side Letter. C10. Events Following Completion 71.Mr Cheung’s evidence was that at the start of January 2011, issues began to surface with The Icon. Purchasers discovered problems in the units and it was ultimately revealed that the BD had not approved the Open Kitchen Layout. 72.Joytex submitted a hearsay notice in respect of: (i) a contemporaneous news report; and (ii) minutes of a Special Meeting of the Panel on Housing of the Legislative Council held on 28 January 2011 (the “Panel Minutes”). 73.The Panel Minutes are significant, particularly in the absence of any witness from SHL or Centaline. The Panel on Housing discussed potential measures to regulate sales of first-hand private residential properties, with reference to issues which had recently arisen in relation to The Icon. Representatives of Centaline attended, including its Group Chairman[12]. 74.The Panel Minutes include the following:
75.Subsequently in 2011, Mr Cheung and solicitors acting for Joytex made written complaints to SHL, including of misrepresentation. Mr Cheung’s evidence was that he received compensation in respect of Flat D on 25/F but not in respect of Flat A, on the basis that he had signed the 2010 Side Letter for Flat A but not Flat D. D. LAW OF MISRREPRESENTATION: GENERAL 76.Though it encompasses several distinct causes of action, there are certain common elements to the law of misrepresentation, which were uncontroversial between the parties. 77.I consider it helpful to outline a few core principles, for which see eg Yang Dandan v Hong Kong Resort Company LtdCACV 247/2015,9 August 2016 per Kwan JA at §§52 – 55 and 67 – 74, and Misrepresentation, Mistake and Non-Disclosure by Cartwright (4th ed) Chapter 3:
E. ANALYSIS OF THE ISSUES E1. Issue 1: Whether the Compliance Representations were made by SHL to Joytex 78.Mr Lui, for Joytex, argued that the Compliance Representations were made by implication from the whole course of SHL’s conduct. He relied principally on events of 29 June 2009, namely: (i) what Ms Wong said in conjunction with her presentation of the Centaline Brochure; and (ii) the 2009 Side Letter. The Compliance Representations were, he argued, repeated and reinforced by subsequent events, including Mr Liu’s words on 8 July 2009. Mr Lui also argued that the Compliance Representations flowed by necessary implication from the Intention Representation. 79.As Mr Lui accepted, events after 8 July 2009 (such as the showroom visit) could not have been operative in terms of misrepresentation at the time of the PSPA or the SPA. However, Mr Lui relied on those subsequent events as corroborative of his client’s case that the earlier representations were in fact made; and illustrative of a continuing representation which was not corrected. 80.I accept Mr Lui’s submission that in assessing whether the alleged representations were made, regard can be had to the cumulative effect of a series of events: Spice Girls Ltd v Aprilia World Service BV [2002] EMLR 27 per Morritt VC at §63. 81.However, it is helpful in this case to give some separate consideration to the key factual features relied on by Joytex. E1.1. The Brochures 82.The most significant brochure is the Centaline Brochure, since Ms Wong used it when presenting The Icon on 29 June 2009 [13]. 83.In my view, if one were to consider only that brochure in isolation, Joytex would face difficulties in establishing that the Compliance Representations were made, or that it was entitled to rely on them. That is because of the various qualifying statements contained therein: see §57 above. These include express statements (albeit in small print) that the depicted layout did not represent the standard of the flat when completed, and was only for reference; and further that the proposed layouts had been altered and were subject to approval from the BD. These statements, in particular the latter, are inconsistent with at least some of the Compliance Representations. 84.In the context of misrepresentation, the relevance of qualifying wording in a property sales brochure was considered by the Court of Appealin Yang Dandan v Hong Kong Resort Company Limited (supra) at §§67 – 74; see also the first instance Judgment of Deputy High Court Judge Kent Yee [2015] 6 HKC 126 at §§44 – 48. The Court of Appeal held that a qualifying statement of this nature may indicate to a reasonable representee that the representor does not assume responsibility for the accuracy or completeness of the statement, or that a representee is not entitled to rely on the statement. 85.However, Joytex does not rely solely on the content of the Centaline Brochure per se, and it is necessary to consider the other relevant facts. E1.2. The 2009 Side Letter 86.The text of the 2009 Side Letter is set out at §49 above. 87.I accept Joytex’s submission that the provision of the 2009 Side Letter to Joytex, carried the implication that the Open Kitchen Layout could be constructed at Flat 25A. 88.SHL disagreed, highlighting that the 2009 Side Letter was a document from Joytex which was addressed to SHL’s contractor rather than SHL itself. However, this ignores the realities of the situation. The letter was in standard form and provided by Ms Wong (SHL’s agent) to Mr Cheung for his signature, for the purpose of selecting fittings and finishes for an Open Kitchen Layout rather than an Enclosed Kitchen Layout. In my view, a reasonable recipient of the letter in that context would understand its provision to entail an implicit representation that an open kitchen would and could be built. 89.There was no evidence before me as to the provenance of the 2009 Side Letter, or whether it was approved by SHL. However, on a balance of probabilities I conclude that SHL is likely to have known about and/or approved of the 2009 Side Letter. E1.3. Ms Wong’s statements on 29 June 2009 90.As set out above, Ms Wong’s statements on 29 June included that: (i) the small units A and D have open kitchens; (ii) the developer had confirmed that there would be open kitchen and that was why the floor plansin the sales brochure were designed in this way; (iii) the 2009 Side Letter wassigned for the developer to convert the one bedroom in the original floor plan into two bedrooms and to construct an open kitchen; and (iv) the developer had already made arrangements and engaged professionals to design the open kitchen, therefore there would be no problems for any changes and it would be lawful. 91.There can be little doubt that these statements entailed, whether expressly or by implication, the Compliance Representations. E1.4. Authority of Ms Wong 92.The parties disagreed as to whether, when making these oral statements, Ms Wong acted on SHL’s behalf. SHL argued that: (i) Joytex failed to sufficiently plead Ms Wong’s actual or ostensible authority to do so; and (ii) in any event, there was no such authority. 93.I do not accept SHL’s pleading point. Joytex pleaded that Ms Wong’s oral representations were made as agent of SHL. The point is shortly pleaded, but I consider it sufficient. I do not think that SHL was takenby surprise, nor was it suggested that had agency been pleaded in more detail, SHL would have adduced additional relevant evidence. 94.Moving to the substantive issue of authority, a number of Hong Kong cases consider the question of agency for the vendor where an estate agent makes representations to the purchaser of property[14]. 95.It is a question of fact in each case whether an estate agent is acting for a particular party in providing to another information relating to a property: Yili Concepts (HKG) Limited v Lee Wai Chueng (supra) at §48; Jopard Holdings Limited v Ladefaith Limited (supra)at §30. 96.The present case differs, factually, from much of the Hong Kongcase law. That case law concerns estate agents who act for both vendor andpurchaser as broker: Cheng Kwok Fai v Mok Yiu Wan, Peter (supra) at 445F; Yili Concepts at §47. The authorities consider that such an agent may assume different roles at different times, and examine the facts to see whether at a particular point in time the agent was acting for vendor or purchaser. 97.Here, by contrast, Centaline acted only for SHL as sole sales agent. 98.Mr Lui, for Joytex, drew attention to various terms of the agencyagreements between Centaline and SHL (referred to above)[15]. He argued thatMs Wong’s oral representations were made whilst performing duties entrusted by SHL to Centaline under those agreements. He further emphasised that SHL was involved in the preparation of, and gave final approval for, the Centaline Brochure which depicted the Open Kitchen Layout. 99.Mr Ho, for SHL, argued that there was no evidence that Ms Wong had actual authority to say what she did on SHL’s behalf. Further, her oral representations were inconsistent with the “qualifying words” in the Centaline Brochure, such that they must have exceeded her actual authority. 100.I am inclined to accept that some of Ms Wong’s statements went beyond her actual authority as SHL’s agent. It is Joytex’s case that the Centaline Brochure was approved by SHL, and that brochure contains “qualifying words” which do not sit well with some of her statements. 101.However, I take the view that Ms Wong acted within her ostensible authority as SHL’s agent:
102.SHL relied on dicta in Cheng Kwok Fai v Mok Yiu Wan, Peter (supra)and Jopard Holdings Ltd v Ladefaith Limited (supra) §§31 – 32, to the effect that the mere appointment as an agent for selling a flat was insufficient, in those cases, to clothe the agent with authorityto make the representations complained of. However, both cases make clearthat the question of agency is fact-sensitive; and both concerned dual agents as acting as brokers. In other cases with different facts, the estate agent’s representation was held to be within the scope of his or her authority. E1.5. Mr Liu’s statements on 8 July 2009 103.As set out above, I accept that Mr Cheung specifically asked Mr Liu about the floor plan attached to the SPA. Mr Liu told Mr Cheung that: the floor plan was used for the formal SPA; the developer undertook to change the kitchens of units A and D into open kitchens; as long as the developer had undertaken to do so Mr Cheung should not worry and there would be no problem. 104.In my view, again applying the approach set out at §77(2) and (3) above, these statements entailed, whether expressly or by implication, the Compliance Representations. That is particularly so given that Mr Liu was a legal professional, who ought to be in a position to assist as to potential legal impediments to the construction of the Open Kitchen Layout. E1.6. Authority of Mr Liu 105.There is again an issue as to whether Mr Liu’s statements are to be treated as representations by SHL. 106.SHL argued not, on the basis that the Solicitors were instructed to act for both parties, and any representation was made in their capacity as Joytex’s solicitors. 107.Joytex accepted that, strictly speaking at least, the Solicitors acted for both parties[16]. Mr Lui pointed out, however, that the SPA referred to them as solicitors for “the Vendor”, and that in various correspondence the Solicitors described themselves as acting for SHL. In any event, Mr Lui said he did not need to rely on Mr Liu’s representations to succeed, since other events (including of 29 June) were sufficient. 108.In my view, Mr Liu’s representations were made on behalf of SHL:
E1.7. Conclusion on Issue 1 109.On Issue 1, I conclude that SHL made the Compliance Representations (or representations to similar effect) to Joytex, prior to both the PSPA and the SPA. 110.In so concluding, I rely not on one specific document or incident, but on the cumulative fact-set including: (i) Ms Wong’s oral statements on 29 June 2009 coupled with her presentation by reference to the Centaline Brochure and the plans therein; (ii) the provision to Joytex of the 2009 Side Letter; (iii) the various depictions of the Open Kitchen Layout in the Centaline Brochure; and (iv) Mr Liu’s statements on 8 July 2009. 111.I am fortified in reaching this conclusion by Joytex’s argument that the Compliance Representations flowed as a natural and reasonable inference from the Intention Representation. Mr Cheung was effectively informed from various sources prior to the PSPA and SPA that the Open Kitchen Layout would be provided on completion. The securing of the requisite approvals for that layout is a matter which falls naturally within the province of the developer. A reasonable purchaser in receipt of such information would assume that the developer had secured such approvals or ascertained that they could be secured, and that the same was implicitly represented to him. E2. Issue 2: Reliance 112.Under this heading I consider: (i) whether the representations made had the character of representations on which Joytex was intended and entitled to rely; and (ii) whether Joytex in fact relied on them as a material inducement to contract. 113.I am satisfied that Joytex has made good these requirements, for the following principal reasons:
114.SHL relied on Mr Cheung’s sophistication as a businessman and former Chairman of a listed company. It was not credible, SHL argued, that such a man would rely on representations by a “mere” sales person at Centaline and/or a legal clerk, in preference to the actual wording of documentation such as the PSPA and SPA; particularly given the substantial combined price of the four properties being purchased. 115.I have carefully considered this line of argument, but do not accept it. The representations in question came from a number of different sources which tended to support one another. They included SHL’s sole agent for selling The Icon and a legal representative acting for (inter alia) SHL. 116.Further, as Joytex submitted, the fact that a representee could, with reasonable diligence, have discovered the falsity of a representation, is not of itself a defence to a misrepresentation claim[18]. Thus, if the effect of a contract has been misrepresented, it is not necessarily an answer to say that had the representee read the contract, he or she would have discovered the true position. 117.SHL also relied heavily on the “qualifying statements” in the Centaline Brochure and other brochures: see §§57 – 59 above. I accept that these form part of the factual matrix relevant to Issues 1 and 2: see eg Yang Dandan v. Hong Kong Resort Company Ltd (supra). However, Yang Dandan is factually distinguishable since the allegations of oral representations were rejected on the evidence, so that the misrepresentation claim turned solely on the content of the relevant sales brochure[19]. Given the other key facts of this case referred to above, I do not consider that the qualifying words in rather small print in the Centaline Brochure (and other brochures) are sufficient to defeat Joytex’s claim[20]. E3. Issue 3: Falsity 118.Joytex contended that the Compliance Representations were false, pleading the following particulars: (i) SHL had not obtained the requisite approvals from the BD or the FSD for implementing the Open Kitchen Layout; (ii) to implement the Open Kitchen Layout without such approval would breach the Building Regulations and Fire Safety Regulations; and (iii) SHL had either never submitted any application to the BD for approval of the Open Kitchen Layout in the smaller units, or if it did and was rejected, has been reckless as to whether any impediment for its implementation existed. 119.In its pleading, SHL admitted that it did not deliver Flat 25A with the Open Kitchen Layout, but denied (by bare denial) Joytex’s allegations of falsity. 120.On this topic, Joytex adduced expert evidence from Mr Chan Kwok-wai Albert, a registered surveyor and Authorized Person under the Buildings Ordinance (Cap 123). Mr Chan inspected Flat 25A in May 2013 and June 2018. 121.Mr Chan’s evidence included the following:
122.Despite having leave to do so, SHL adduced no expert evidence to oppose Mr Chan’s. Mr Chan was cross-examined on certain aspects of his report, the detail of which I will not recite. Suffice it to say that I do not think that Mr Chan’s evidence was undermined, and I accept that evidence. 123.Further, there was no suggestion from SHL that the BA ever approved building plans featuring the Open Kitchen Layout. Had that been the case, SHL would surely have been in a position to so establish. The Panel Minutes further suggest that the Open Kitchen Layout was never approved by the BA. 124.For the above reasons I accept that the Compliance Representations were false, in at least the following respects:
E4. Issue 4: Alleged Fraud 125.It is Joytex’s case that the Compliance Representations were fraudulently made. The pleaded particulars are that SHL well knew that the representations were false, or made them recklessly not caring whether they were true or false[22]. 126.In terms of the remedies sought, it matters little whether the fraud allegation is made good[23]. Notwithstanding this, I will deal with the point briefly. 127.In short, I do not consider that Joytex has established the fraudulent intent required to make good the tort of deceit:
E5. Issue 5: Alleged settlement, waiver, affirmation, estoppel 128.Under Issue 5, I deal briefly with SHL’s alleged defences of settlement, waiver, affirmation and estoppel; all of which I reject. E5.1. 2010 Side Letter: alleged settlement/waiver 129.The text of the 2010 Side Letter is set out at §67 above. SHL’s pleading and submissions assert that this amounted to a settlement by which Joytex accepted HK$148,000 in consideration for waiving its rights in connection with the fittings and finishes referred to in the 2009 Side Letter; including the conversion of Flat 25A from Enclosed Kitchen Layout to Open Kitchen Layout. The argument is, apparently, that the present claim is somehow precluded. 130.I reject this argument, without hesitation. The 2010 Side Letter relates to the fittings and finishes in Flat 25A. The waiver contained therein is of SHL’s prior obligation to install fittings and finishes in that flat. However, Joytex’s present complaint is not that SHL failed to install fittings and finishes. Rather, it is that SHL misrepresented the position as to the permissibility of constructing the Open Kitchen Layout. I fail to see how the 2010 Side Letter or the waiver contained therein, assists SHL. E5.2. Affirmation 131.SHL pleads that Joytex elected to affirm the SPA which incorporated the Enclosed Kitchen Layout, by taking an assignment of Flat 25A incorporating the Enclosed Kitchen Layout on 17 December 2010. 132.Mr Ho’s submissions, for SHL, did not refer to this point. In any event, I reject it. By the time of the assignment Joytex had not discovered the falsity of the Compliance Representations, nor had they been corrected[26]. E5.3. Contractual Estoppel 133.In closing submissions, Mr Ho relied on contractual estoppel, citing clause 15 of the PSPA [27]. 134.However, this argument is not open to SHL, since its pleaded defence contains no reference to contractual estoppel, or indeed any species of estoppel, or to clause 15. E6. Issue 6: Relief 135.Joytex seeks: (i) a declaration that the PSPA and the SPA have been rescinded; (ii) repayment of the purchase price for Flat 25A, namely HK$9,817,000; (iii) damages for fraudulent misrepresentation or under section 3(1) of the Misrepresentation Ordinance; (iv) alternatively, damages in lieu of rescission under section 3(2) of that Ordinance; (v) interest and costs. E6.1. Rescission 136.It is trite that in equity the remedy of rescission is available where an actionable misrepresentation induces a contract[28]. 137.In the case of a non-fraudulent misrepresentation, section 3(2) of the Misrepresentation Ordinance grants to the court a discretion to order damages in lieu of rescission. 138.Joytex’s primary position is that it seeks rescission of the PSPA and SPA. SHL has not pleaded or argued that, if Joytex’s misrepresentation complaint is made good, rescission should be refused; nor has any basis been advanced for ordering damages in lieu of rescission. 139.For the reasons canvassed above, I am satisfied that grounds for rescission of the PSPA and the SPA have been established. I see no reason to refuse that remedy, which I therefore grant. 140.It follows from rescission that Joytex is entitled to repayment of the purchase price paid for Flat 25A, namely HK$9,817,000. It is common ground that Joytex should give credit for the HK$148,000 which it received from SHL pursuant to the 2010 Side Letter. This produces a net figure of HK$9,669,000 payable by SHL to Joytex. 141.On repayment of this sum with interest, SHL would be entitled to have Flat 25A conveyed back to it. As is commonly done, I will grant liberty to apply, in case further orders are required to effect rescission. E6.2. Damages under section 3(1) of the Misrepresentation Ordinance 142.Pursuant to section 3(1) of the Misrepresentation Ordinance, damages are available in respect of a non-fraudulent misrepresentation which induces a contract, on the same basis as for the tort of deceit. Damages are awarded so as to put the plaintiff in the position it would have been in, had the representation not been made[29]. See for example: Long Year Development Ltd v Tse Fuk Man Norman & Ors [1991] 2 HKC 393 per Deputy Judge Andrew Li QC (as he then was) at 407D – 408D; Cartwright (supra) at §7-31. 143.Damages are not available under section 3(1) if the representorproves that he or she had reasonable grounds to believe and did believe up to the time of the contract that the facts represented were true. However, SHL has not relied on this qualification in its pleading, evidence or argument. 144.I am accordingly satisfied that as a matter of principle, Joytex can claim damages under section 3(1) for losses flowing from SHL’smisrepresentations, so as to put Joytex in the position it would have occupied had those misrepresentations not been made ie had it not purchased Flat 25A. Such damages can be claimed in conjunction with rescission[30]. 145.The damages sought by Joytex in conjunction with rescission comprise: (i) alleged loss of profits from investing in an alternative property; and (ii) various expenses incurred as a result of purchasing Flat 25A. I consider these in turn. E6.3. Alleged loss of profits from alternative investment 146.Joytex seeks damages of HK$5,150,000 for loss of profits[31] on the basis that: (i) but for the misrepresentations, Joytex (or Mr Cheung using Joytex) would have invested in an alternative property; and (ii) betweenthe dates of its acquisition and the trial, the value of that alternative property would have increased by HK$5,150,000. 147.Joytex relied principally on the evidence of its valuation expert, Mr Wong Chi Wai. Mr Wong identified a specific property said to be a suitable “alternative” to Flat 25A, namely Flat C on 22/F of Soho 38 at No 38 Shelley Street (“22C Soho 38”). 148.Further, Joytex cited evidence that in 2009 Mr Cheung and Madam Chou had spare funds to invest and had visited other residential properties (though not Soho 38). Mr Lui argued that it was unnecessary to prove that this specific alternative flat would have been bought; he had only to establish that an alternative flat would have been bought, and 22C Soho 38 served as an appropriate basis to quantify the profit which would have been earned. 149.Mr Paul Varty, called by SHL, gave opposing expert evidence, disputing that 22C Soho 38 was a suitable comparator for The Icon. SHL argued that the claim for lost profits was too speculative and not made good on the evidence. E6.4. Loss of profits: authorities 150.In claims for deceit and under section 3(1) of the Misrepresentation Ordinance, it is possible to recover damages for lost profits which would, but for the misrepresentation, have been earned on an alternative investment[32]. 151.Mr Lui accepted (citing 4 Eng Ltd v Harper (supra)at §§56 – 58) that in order to establish such a claim a plaintiff must show on a balance of probabilities that it would have entered into the alternative and more profitable transaction, and a real and substantial chance (as opposed to a speculative one) that the relevant third party would have transacted. 152.In Long Year Development Ltd v Tse Fuk Man Norman (supra), the learned Judge held the third parties liable to pay damages to the defendant under section 3(1) of the Misrepresentation Ordinance, for misrepresentation inducing the defendant to purchase a property. At 409F to 410D, the learned Judge considered and rejected a damages claim for the lost chance to purchase a different property and re-sell at a profit. The reasoning included the following (with emphasis added):
153.In Yang Dandan v Hong Kong Resort Company Ltd (supra)at first instance, the learned Judge rejected the plaintiff’s complaint of misrepresentation inducing her propertypurchase. At §§87 – 107 he went on to consider, obiter dicta, the plaintiff’s claim for damages for loss of a chance to purchase an alternative “ideal” property, indicating that in any event that head of claim would have failed. The learned Judge’s reasoning included that: (i) it must be shown that the plaintiff had at least a reasonable chance, as opposed to a speculative chance, to purchase the “ideal” property (§95); (ii) the plaintiff should prove that theideal property existed, was available to her and within her budget (§§96 – 99); (iii) a specific alternative transaction should be identified (§§100 – 102); (iv) on the facts, the alternative transactions identified in the plaintiff’s expert evidence were either unavailable to the plaintiff or were not suitable alternatives (§§103 – 107). 154.This portion of the first instance judgment was briefly referred to (obiter dicta) by Kwan JA in the Court of Appeal at §§82 – 85. The Court of Appeal indicated that no error was detected in the learned Judge’s approach in finding that on the evidence before him the loss in question was not proved. E6.5. Loss of profits: expert evidence 155.Mr Wong and Mr Varty addressed four expert questions directed at quantum[33]. 156.It is unnecessary to here analyse their evidence on these questions in detail. The relevance of certain of the expert questions has fallen away due to the grant of rescission (see above) and dropping of Joytex’s contractual claim. 157.For present purposes, the focus is on expert questions (a) and (b), regarding alternative properties. As noted above, Mr Wong selected 22C Soho 38 as the most suitable alternative to Flat 25A, citing features including location, purchase price and open kitchen design. 158.Mr Varty disagreed, opining that 22C Soho 38 was not comparable to Flat 25A since (inter alia) it was a secondary rather than primary sale. In Mr Varty’s view, the most suitable alternatives were other flats in The Icon[34]. 159.Understandably, the experts approached the question of an alternative flat from the viewpoint of valuers, accustomed to considering comparables for the purposes of valuation. Though this expert evidence assists to some extent, the court’s task is different, namely, to assess whether there is sufficient evidence to make good Joytex’s factual claim that but for the misrepresentations it would have purchased 22C Soho 38 (or a similar flat); and if so what profit would have been made. E6.6. Loss of profits: analysis and conclusion 160.The burden is on Joytex to make good this head of claim, but I conclude that it has failed to do so:
161.I note, in passing, that had I awarded damages for loss of profits, I would have disallowed certain other heads of claim, namely: (i) interest on the HK$$9,817,000 purchase price paid; and (ii) expenses flowing from the purchase of Flat 25A. I consider that to award these items in addition to lost profits on an alternative property, would entail double-counting. E6.7. Expenses resulting from the purchase 162.Joytex claims damages for certain costs and expenses incurred as a result of purchasing Flat 25A including: (i) legal costs and stamp duty incurred in the purchase (pleaded at HK$398,827); (ii) interest under a mortgage loan (pleaded at HK$56,368.61 as at 15 December 2011); (iii) management fees, deposits and miscellaneous expenses incurred at completion (pleaded at HK$14,918); (iv) management fees from 17 December 2010 to 30 November 2011 at HK$19,274 and thereafter at HK$1,678 per month. 163.Joytex is entitled to damages to place it in the position it would have occupied had it not purchased Flat 25A. I am accordingly satisfied that expenses of this nature can, in principle, be claimed. 164.The exception is the mortgage interest, which I decline to order. Since Joytex is awarded interest on the purchase price for Flat 25A (below), I consider that awarding mortgage interest would entail double-counting. 165.During closing submissions, Mr Lui indicated that he was not in a position to provide a final quantification of these losses, and invited the court to leave them to the parties to agree[37]. Whilst it would have been preferable to have a final quantification available, I am prepared to proceed in this way rather than disallow the sums. If the parties are unable to agree on the quantum of these items, they should seek further directions from the court in this respect. E6.8. Alleged failure to mitigate losses 166.In closing submissions, SHL argued that Joytex failed to mitigate its losses, by failing to lease out Flat 25A since taking possession[38]. SHL’s submissions on quantum were substantially based on this allegation; seeking credit for HK$28,000 monthly rent which allegedly could have been received since December 2010. 167.However, this point is not open to SHL as it simply was not pleaded. Mr Lui submitted that had it been pleaded, Joytex would have adduced relevant evidence. I accept that it would be unfair to Joytex to permit SHL to run this unpleaded point. E6.9. Interest and costs of these proceedings: orders nisi 168.In the exercise of my discretion, I award simple interest on the sum of HK$9,669,000 plus the amounts agreed or found due for expenses of the purchase, at the commercial rate of 1% over HSBC prime from 17 December 2010 to the date of judgment. Thereafter, interest will accrue at the judgment rate. 169.As to costs, I consider that Joytex has substantially succeeded. I order that SHL pay Joytex its costs of these proceedings, to be taxed if not agreed. 170.My orders as to interest and costs are orders nisi which will become absolute within 14 days, in the absence of any application to vary. F. CONCLUSION AND DISPOSITION 171.I find for Joytex and will grant the following relief and orders:
Mr Mike Lui, instructed by Cheung & Yip, for the plaintiff Mr Kenneth Ho, instructed by Luk & Partners (in association with Morgan, Lewis & Bockius), for the defendant
Annex I
Annex II [1] This was agreed in the pleadings. SHL is and was a wholly owned subsidiary of Winfoong International Limited (榮豐國際有限公司) (later named China Graphene Group Limited (中國烯谷集團有限公司)), a company listed on the Main Board of the Hong Kong Stock Exchange. [2] The Statement of Claim also included a claim for breach of contract, but this was dropped by Joytex during oral opening submissions. [3] The layout plans annexed to this Judgment are those which were attached to the 2009 Side Letter,defined below; and also included as Appendices to the Statement of Claim. [4] Later known as Siberian Mining Group Company Limited. Rontex was listed in 2002. The principal business of its group at that time was the sourcing, manufacture and sale of garments to countries in South America and the trading of items including baby items, party items and leather belts. [5] In 2008 the SFC commenced proceedings in respect of Rontex under section 214 of the Securities and Futures Ordinance (Cap 571), seeking (inter alia) disqualification and compensation orders against Mr Cheung and Madam Chou. The proceedings related to four allegedly questionable transactions. By a Judgment dated 18 March 2010 in HCMP 1869/2008, Burrell J made orders (inter alia) prohibiting Mr Cheng and Madam Chou from acting as company directors without leave, for five years. By a Judgment of the Court of Appeal dated 16 May 2011 in CACV 91/2010, this was substituted for four years in the case of Madam Chou. The findings entailed a degree of incompetence, dereliction of duty and lack of corporate governance, but there was no allegation of fraud or dishonestly: Court of Appeal Judgment at §§40 – 42. [6] Including: the instruction of solicitors prior to a formal Sales and Purchase Agreement is importantfor the protection of the purchaser’s interests; the purchaser is recommended to instruct their own solicitor to provide independent advice; careful thought should be given to the instruction of an independent solicitor or the vendor’s solicitor, and the purchaser is free to choose either option. [7] eg “The Pinnacle of an Unmatched Residence”, “Indulgence of the Superb Privileges”. [8] The trial bundles contained more than one version of the Hong Fok Brochure, and there was debate as to which version was provided to Mr Cheung on 29 June 2009. Having heard the evidence and argument, I consider that the version which originates from Joytex’s Lists of Documents is the correct version; rather than the version containing a list of eight “Points to Note” which was put to Mr Cheung during cross-examination. [9] Similar wording is included in a “Note” at the end of the brochure. [10] This was accepted in the letter dated 24 May 2012 from Centaline to SHL’s former solicitors: see above. [11] The evidence was that the date of 11 November 2010 on the 2010 Side Letter was inserted subsequently. [12] The developer, Winfoong International Limited, declined the invitation to attend. [13] The other two brochures are of mixed effect since (as set out above) they contain plans depicting both the Open Kitchen Layout and the Enclosed Kitchen Layout; and various qualifying wording. But it is notable that the Joint Brochure contains numerous depictions of an open kitchen, some of which are not accompanied by qualifying words. [14] See for example: Cheng Kwok Fai v Mok Yiu Wan, Peter [1990] 2 HKLR 440 per Godfrey J (as he then was) at 445E–H; Welltech Investment Ltd v Easy Fair Industries Ltd [1996] 4 HKC 711 per Le Pichon J (as she then was) at 719E–H; Green Park Properties Ltd v Dorku Ltd [2000] 2 HKLRD 400 per Cheung J (as he then was) at 417J – 418B; Yili Concepts (HKG) Limited v Lee Wai Chueng & another HCA 12911/1997, Deputy High Court Judge S Kwan (as she then was), 29 September 2000 at §§46 – 53; Jopard Holdings Limited v Ladefaith Limited & another [2005]1 HKLRD 317 per Recorder B Yu SC at §§28 – 34; Montrio Limited and another v Tse Ping Shun David [2013] 4 HKC 505 per Kwan JA at §§24 – 34. [15] These included provisions that: Centaline be appointed sole sales agent for The Icon responsible for promoting and selling the property in accordance with the provisions of the agreement; Centaline shall try its very best to promote and sell to its clients according to the information and price set as provided by SHL and listed therein; Centaline shall co-ordinate the relevant sale and marketing activities and assign experienced licensed agents to be on duty to answer the inquiries of its clients according to the instructions of SHL; Centaline should try its very best to promote and sell the property. [16] This is apparent from eg the Free Legal Fee Letter: see above. [17] That is because the solicitor has implied authority to answer such inquiries, and in so doing acts within the scope of his authority: Gran Gelato Ltd v Richcliff (Group) Ltd [1992] Ch 560 per Sir Donald Nicholls VC at 570D – 571B; William Flenley QC & Tom Leech QC, Solicitors’ Negligence and Liability (3rd ed) at §§5.17 - 5.18. [18] See: Redgrave v Hurd (1881) 20 Ch D 1 at per Jessel MR at 13 – 15; Balchita Ltd v Kam Yik Investment Co Ltd [1983] 2 HKC 333 per Kempster J at 340B–D; Chitty on Contracts (32nd ed) at §7-043. [19] In addition, the plaintiff in that case had read the qualifying statements in the sales brochure: Court of Appeal Judgment §70. [20] Compare, for example, Lewin v Barrett Homes Ltd[2000] 1 EGLR 77, in which a developer was held to have misrepresented through images the type of house intended to be built, notwithstanding written disclaimers attached to those images. See also Walker v Boyle [1982] 1 WLR495 per Dillon J at 501G: a person who makes a representation of fact cannot (necessarily) negative it by reference to small print. [21] These included that: (i) BD/FSD would likely require use of only electrical appliances in an open kitchen, in addition to other fire safety measures; (ii) the fire separation between open kitchen and means of escape was a major concern, and BD/FSD would require a fire rated wall to be built between the open kitchen and the main entranceway; (iii) the distance between the open kitchen and means of escape was a high risk factor in this case, and BD/FSD may require a sprinkler system. However, this was infeasible as it required a sizeable water tank, fire pumps, fire alarm control panels, and associated plumping pipes and electrical installations, which could not fit in a flat of this size. [22] Fraudulent misrepresentation is pleaded to have occurred on three occasions: 29 June, 8 July, and August 2009. [23] Mr Lui accepted this. The only practical consequence in this case appears to be that Joytex would then be entitled to rescission as of right; as opposed to subject to the court’s power to orderdamages in lieu under section 3(2) of the Misrepresentation Ordinance. But as discussed below,no reason has been advanced why the court should, in this case, order damages in lieu of rescission. [24] Cartwright (supra)at §5-13; ADS v Brothers (2000) 3 HKCFAR 70. [25] Cartwright at §§5-14 to 5-15. [26] Affirmation so as to preclude rescission for misrepresentation, requires knowledge of the falsity of the representation: Cartwright at §4-43. If anything, by the time of completion, the relevant representations would have been reinforced by the showroom visit in August 2009. [27] Clause 15 provides: “The terms and conditions hereof shall supersede any and all other oral agreements or representations made by or on behalf of the Vendor or its agent”. [28] Cartwright §4-04. [29] This is contrasted with the contractual measure, which puts the plaintiff in the position it would have been in had the representation been true. [30] Cartwright at §2-13. [31] At times, Joytex also described this head of claim as one for “loss of a chance”. [32] See for example: Cartwright at §§5-39 and 7-40; Long Year Development Ltd (supra) at 409F – 410D; East v Maurer [1999] 2 All ER 733; 4 Eng Ltd v Harper [2009] Ch 91 per David Richards J at §§41 – 109; Clef Acquitante SARL v Laporte Materials (Barrow) Ltd [2001] QB 488; Yang Dandan (supra) per Deputy High Court Judge Kent Yee §§87 – 107 and per Kwan JA in the Court of Appeal at §§82 – 85. [33] The expert questions were: (a) what were the properties alternative and similar to Flat 25A which Joytex would be able to purchase in around June-July 2009 for the price of HK$$9,817,000; (b) what are the respective present fair market values of the alternative properties; (c) what was the fair market value of Flat 25A with the Enclosed Kitchen Layout as at around June-July 2009; and (d) what is the present fair market value of Flat 25A (i) with the Open Kitchen Layout and (ii) with the Enclosed Kitchen Layout. [34] Further, the experts disagreed (slightly) as to the June 2018 valuation of 22C Soho 38. [35] Statement of Claim §14. [36] During oral evidence, Mr Wong sought to explain this by reference to market movements precipitated by the financial crisis of that period. However, the market movements required to explain this do not sit easily with the data in the Rating and Valuation Private Domestic Price Index exhibited to Mr Varty’s second report. [37] As per the approach in 4 Eng Ltd v Harper (supra) at §111. [38] When cross-examined on this, Mr Cheung accepted that Flat 25A had not been rented out, stating that it was a bare shell flat which could not be leased. | ||||||||||||||||||||||
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