Wong Kin Tit Trading As Flourish Engineering Company v. Zeng Yongju and Lam Yuen Piu Trading As Lung Shan Construction Company (A Firm)

DCCJ 183/2021

[2025] HKDC 2109

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 183 OF 2021

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JUDGMENT

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A. INTRODUCTION

1.This case concerns a contractual dispute arising from a renovation project (“Project”) at Houses 32 to 34 (“3 Houses”) of Windsor Park Phase 2 in Kau To Shan, New Territories (“Site”).

2.The Plaintiff, Wong Kin Tit (黃建鉄) (“Mr Wong KT”) trading as Flourish Engineering Co (豐盛工程工司), was and is a sole proprietor carrying out a business of construction and renovation work.

3.The Defendant, Zeng Yongju (曾永居) (“Mr Zeng”) and Lam Yuen Piu (林元標) trading as Lung Shan Construction Co (龍山建築工程工司) (a firm), was and is a partnership also carrying out a business of construction and renovation work, with Mr Zeng as one of its two partners.

4.In April 2020, the Plaintiff entered into an agreement (“the Agreement”) with the Defendant for the Defendant to perform works for rendering and/or plastering (外牆批盪) and laying of tiles (鋪瓦仔) on the external wall surfaces of the 3 Houses at the Site (“Agreed Trades”). The works under the Agreement also included cleaning and defects rectification.

5.After the Defendant commenced work, the Plaintiff subsequently requested the Defendant to perform additional works which were outside the scope of the Agreement (“Additional Works”). What falls within the scope of the Agreement and what would be regarded as Additional Works are issues hotly disputed by the parties, but it is not disputed that for work that does not fall within the scope of the Agreement, it would be charged at the rate of HK$1,600 per “man day” (工數) (“Man-Day”).

6.There is also no dispute that, since the commencement of the work in April 2020, certain interim invoices were sent by the Defendant to the Plaintiff, and the Plaintiff has made 4 payments totaling HK$530,000 to the Defendant.

7.The relationship between the parties broke down in the latter part of 2020:

7.1  The Plaintiff claims the Defendant suddenly ceased work shortly after tendering the invoice dated 27 September 2020 without any notice, and thereby evinced an intention no longer to be bound by the agreements and repudiated the same. The Plaintiff thereby seeks judgment against the Defendant for loss and damages resulting from the need to incur additional costs for completing the remaining works, cleaning costs, and for reimbursement of the material costs and wages of the Defendant’s workers which the Plaintiff paid on the Defendant’s behalf. According to the Plaintiff’s pleaded case, the loss and damages claimed add up to HK$594,139.00.

7.2  On the other hand, the Defendant claims the Plaintiff failed to make full and punctual payments, and together with the Plaintiff’s various “unilateral, abrupt, unreasonable and unlawful acts and behavior,” the Plaintiff thereby evinced an intention no longer to be bound by the Agreement and the agreement for the Additional Works (“Additional Works Agreement”) and repudiated the same. The Defendant thereby counterclaims against the Plaintiff for the outstanding payments for the work done at the Site for a sum of HK$633,708.00 (“Outstanding Amount”).

B.  THE ISSUES

8.The parties have prepared a Joint Statement of Issues in Dispute for this action:

The formation of the Agreement

8.1  Whether the Agreement between the parties was:

(a)  made orally and as evidenced by the Defendant’s written quotation dated 7 April 2020 (Item 3 of Plaintiff’s List of Documents)(“the Plaintiff’s version of the 7 April 2020 Quotation”), or;

(b)  made by the Plaintiff’s acceptance of the Defendant’s written quotation dated 7 April 2020 (Item 1 of Defendant's List of Documents) (“the Defendant’s version of the 7 April 2020 Quotation”)? (“Issue 1”)

The terms of the Agreement

8.2  Whether the Agreement was:

(a)  a “measurement” contract based on the agreed rates of HK$360/m² for rendering/ plastering external wall surfaces and HK$300/m² for laying of tiles (collectively “the Agreed Rates”), such that the final sum payable by the Plaintiff to the Defendant would be calculated by multiplying the actual area of the external wall with the Agreed Rates (“Measurement Contract”), or

(b)  a “lump sum” contract with the contract sum of HK$397,108 based on an agreed area of the external wall of 601.68 m², such that the price for rendering/plastering external wall and laying of tiles exceeding the area of 601.68 m² would not be calculated at the Agreed Rates, but instead at the rate of HK$1,600 per Man-Day and subject to the terms of the Additional Works Agreement (“Lump Sum Contract”)? (“Issue 2”)

8.3  Under the Agreement, which party shall be responsible for providing cement and sand? (“Issue 3”)

8.4  What were the payment terms under the Agreement? (“Issue 4”)

8.5  Whether the implied terms as pleaded by the Plaintiff existed? (“Issue 5”)

Works outside of the scope of the Agreement

8.6  What was the scope of the Additional Works as agreed between the parties (ie the Additional Works Agreement)? (“Issue 6”)

8.7  Whether it was the arrangement between the parties that the Defendant had to submit fee quote to the Plaintiff for prior approval prior to the commencement of the Additional Works? (“Issue 7”)

8.8  Did the Plaintiff ever “borrow” the Defendant’s workers for carrying out the Additional Works? (“Issue 8”)

8.9  What were the payment terms in respect of the Additional Works? (“Issue 9”)

The Performance of the Agreement and the Additional Works

8.10  What works have been performed by the Defendant under the Agreement and the Additional Works Agreement? (“Issue 10”)

8.11  Was the Plaintiff in repudiatory breach of the Agreement and/or the Additional Works Agreement by failing to pay the Defendant the amount due and doing so in a timely manner, allegedly paying wage to the Defendant’s workers without authorisation and making unwarranted threats to the Defendant? (“Issue 11”)

8.12  Was the Defendant in repudiatory breach of the Agreement and/or the Additional Works Agreement by failing to continue with the works and informing the Plaintiff of such intention on or about 6 October 2020? (“Issue 12”)

Loss and Damages

8.13  If the Defendant was in breach of the Agreement and/or the Additional Works Agreement, did the Plaintiff suffer from loss and damages as a result? If so, what are the loss and damages? (“Issue 13”)

8.14  If the Plaintiff was in breach of the Agreement and/or the Additional Works Agreement, did the Defendant suffer loss and damages as a result? If so, what are the loss and damages? (“Issue 14”)

Outstanding Amount

8.15  Whether the Plaintiff is liable to pay the Defendant the outstanding amount as claimed. If not, what is the proper amount entitled by the Defendant, if any? (“Issue 15”)

C.  THE FACTS AND EVIDENCE

9.There is no dispute that Mr Wong KT and Mr Zeng are fellow clansmen, and the Project was not the first time that the Plaintiff and the Defendant worked together. They were introduced to each other in late 2019, and the Defendant was sub-contracted by the Plaintiff for a project at the Chinese University (“the CU Project”). There was no evidence as to the exact terms of that contract, but suffice it to say that it was Mr Zeng’s own evidence during cross-examination that the project completed in March 2020, and he was eventually fully paid for his work after the Chinese University accepted the work done. Having worked together before, the Plaintiff therefore, in March 2020, further invited the Defendant to give a quotation for the Project.

10.Both parties have, for this trial, provided screen captures of the WhatsApp conversation between Mr Wong KT and Mr Zeng to support their respective cases regarding what happened thereafter. I consider them to be important contemporaneous records of the dealings between the parties. Mr Zeng has also provided screen captures of various WhatsApp conversations he had with Mr Wong Kin Lok (黃建樂) (“Mr Wong KL”) of HKP Engineering (Materials) Ltd (“HKP”) (which, according to the Plaintiff, was the main contractor for the Project) and one Mr Hui (it is undisputed that he was the representative of the landlord) (“Mr Hui”) respectively. There are over 100 pages of these WhatsApp conversations (collectively, “WhatsApp Conversations”).

11.From those screen captures of the WhatsApp Conversations produced by the Defendant, it could be seen that many photographs were exchanged between them, and many of the messages between them were voice messages. Most of the photographs in the WhatsApp Conversation are blurry, and the parties have only provided a few transcripts of those voice messages in the trial bundles.

12.By cross-checking the same with those screen captures produced by the Plaintiff and from the parties’ confirmation during trial, either by counsel's submissions or viva voce evidence of the witnesses, the following (which I consider to be relevant) could be ascertained.

12.1.  On 9 March 2020, 12 photos of the Site, together with a photo of the tiles to be used, as accepted by Mr Zeng during cross-examination, were sent by Wong KT to Mr Zeng (“March Photos”).

12.2.  On 10 March 2020, a quotation dated 10 March 2020 (“March Quotation”) was sent by Mr Zeng to Mr Wong KT. Despite the initial uncertainty by both Wong KT and Mr Zeng as to where that quotation was in relation to, both of them eventually confirmed in their respective cross-examination that it was in relation to the Project[1]. On the evidence before me, this March Quotation, as Mr Desmond Leung, counsel for the Plaintiff submitted, appeared to be the first quotation the Defendant sent to the Plaintiff regarding the Site.

12.3.  In the said March Quotation, it could be seen that only the rates for rendering and/or plastering and laying of tiles were stipulated by the Defendant therein. It was accepted and admitted by Mr Zeng that back then, he did not know the exact address of the Site or the areas of work that needed to be performed.

12.4.  After some untranscribed voice messages were exchanged between them on 13 March 2020, a video of the 3 Houses was then sent to Mr Zeng by Mr Wong KT on 17 March 2020, specifying “九肚山這三間”, followed by a layout plan of the 3 Houses on 18 March 2020 (“the Layout Plan”). After the Layout Plan was sent, Mr Zeng asked, “老板, 这是什么?” and Mr Wong KT then sent a voice message (but untranscribed) immediately thereafter.

12.5.  On 19 March 2020, the exact address of the Site, together with an internet link of a map, was then sent to Mr Zeng by Mr Wong KT.

12.6.  On 7 April 2020, the Plaintiff’s version of the 7 April 2020 Quotation was sent by the Defendant to the Plaintiff. On the same day, another document dated 6 April 2020 which appeared to be the invoice for the CU Project was also sent by Mr Zeng to Mr Wong KT (the relevance of it will be explained below).

12.7.  After some untranscribed voice messages were exchanged between Mr Zeng and Mr Wong KT on 28 April 2020, detailed measurement of the areas of the 3 Houses which the Defendant was requested to work on was then done, and 3 photos illustrating the same were sent to Mr Wong KT (“The Defendant’s Measured Area”). The 3 photos show that:

House 32	266.345 m2
House 33	276.27 m2
House 34	281.9625 m2
TOTAL:	824.5775 m2

12.8.  After some further exchanges of WhatsApp messages (which neither party made particular references to in the course of the trial), on 23 June 2020, a total of 27 photos were then sent by Mr Zeng to Mr Wong KT, followed by a series of voice messages between them on the same day. The Plaintiff has produced the transcripts of some of these voice messages in the trial bundle[2](the accuracy of which has not been challenged by the Defendant). From the said transcripts, it could be seen that there were queries raised by Mr Wong KT whether certain $90,000 included the material costs (“你嗰D包唔包埋料呀?你嗰九萬幾係咪包埋英泥沙包埋磚呀?”), and thereafter Mr Zeng replied that he would make some calculations and add those costs into the sum (“好呀好呀，一陣我計計條數加落去囉…”).

12.9.  From about 22 or 23 June 2020 onwards, there were then further exchanges of WhatsApp messages (including both written and audio messages and photos) between Mr Zeng and Mr Wong KT, Mr Wong KL and Mr Hui respectively. Save for a few of the voice messages dated 4 July 2020[3], 23 and 24 August 2020[4], and 6, 9 and 13 October 2020[5], the Court has not been provided with any transcripts of the other voice messages. Most of the photos exchanged were blurry, and the parties have not cross-referenced them with those other clear images provided to the Court (be it those in the working bundle or those in the document bundles).

12.10. Nonetheless, from the visible images that could be seen from the WhatsApp Conversations and those limited audio transcripts provided by the parties, I notice that:

(a)  Some of the photos relating to the Additional Works were sent back by Mr Wong KT[6] or Mr Wong KL[7] respectively to Mr Zeng, followed by some untranscribed voice messages between them.

(b)  Some of the photos/messages sent by Mr Hui also appeared to have been forwarded by the Plaintiff to Mr Zeng[8].

(c)  Mr Wong KL would raise issues regarding the Site directly with Mr Zeng, and Mr Hui would give work orders directly to Mr Zeng.

(d)  A photo which appears to be a paper was sent by Mr Zeng to the Plaintiff on 12 July 2020[9]. In light of [C2/531], it might well be the June  Invoice (as defined below)

(e)  Receipts of the material purchased by the Plaintiff would be forwarded to Mr Zeng[10].

(f)  A paper, which appeared to be a quotation for some work in relation to House 32 in the total sum of $18,000, was forwarded by Mr Zeng to Mr Wong KT on 30 July 2020[11] at 8:52 pm.

(g)  The invoice for July dated 19 August 2020 was sent by Mr Zeng to Mr Wong KT on 23 August 2020 (“July Invoice”). After sending the said invoice, as per the transcript of the voice messages that follows, Mr Zeng then requested Mr Wong KT for more interim payment to allow him to pay the wages for his workers as he was running short of money:

On 23 August 2020 at 12:37 pm – “老細呢期呢要度出啲比我喎黎架喎，唔掂喎，個個我頂左五六萬…”

On 24 August 2020 at 9:24 am – a photo of the Defendant’s workers’ “Man-Day” record followed by the voice message “呀老細，幫幫手啦，可唔可以加多幾萬比我啦，我真係唔夠出啦，我戶口又無咩錢啦…幾萬蚊我真係唔夠出啦，啲糧我出比人地…”.

In his message on 24 August 2020 at 9:25 am, Mr Zeng further asked Mr Wong KT to treat the payment as a loan to him and claimed that he was making a loss “當借埋比我啦，我本身就蝕埋錢啦…”.

(h)  On 26 August 2020, Mr Zeng sent a quotation (with the Defendant’s stamp) dated 26 August 2020 for various additional works for the Site in relation to House 33 for a total sum of HK$22,282 upon Mr Wong KT’s request (“26 August 2020 Quotation”). It was Mr Zeng’s viva voce evidence that such quotation was sent to him for his signature by the main contractor, and the writings therein were not his handwriting.

(i)  On 29 September 2020, Mr Zeng sent the invoice for August 2020 dated 27 September 2020 to Mr Wong KT (“August Invoice”).

(j)  On 6 October 2020, Mr Zeng sent a voice message to Mr Wong KL at 8:16 am, saying that he would quit, as he had not paid wages for two months, and had made a loss of over one hundred thousand dollars in the past few months (“阿黃老闆早晨，我已經有兩個月無出糧啦，跟住我前幾個月都蝕咗十幾萬啦，無理由再玩落去，我唔玩啦，就咁啦掰掰”) (“6 October 2020 Voice Message”).

12.11. After Mr Zeng’s said indication to quit, attempts were then made by Mr Wong KT, Mr Wong KL, and Mr Hui respectively to negotiate with Mr Zeng. During such a course:

(a)  Both Mr Wong KT and Mr Wong KL tried to call Mr Zeng to discuss the matters in person, but Mr Zeng did not respond. In particular, on the same day after the 6 October 2020 Voice Message was received by Mr Wong KL on 6 October 2020, he requested Mr Zeng to provide the figure of the wages of his workers and the outstanding payment for the Project for discussion, as he did not want to affect the progress of the Project:

At 12:39 pm - “俾個電話我，傾傾尾數及工人出糧問題

At 10:02 pm – “今晚係咪會俾條數我，[明](as clarified by Mr Wong KL during cross-examination)日我同三哥 [ie Mr Wong KT] 傾傾，因為唔想影響地盤進度”

(b)  On 7 October 2020, Mr Zeng sent to Mr Wong KL two lists of wages of the Defendant’s workers for the period from July 2020 to September 2020 (“Defendant’s Workers’ Wages Lists”) and a list/note setting out the work and total sum of HK$877,800 which Mr Zeng claimed to be entitled from the Project (“Defendant’s 7 October 2020 Calculation”).

(c)  On 13 October 2020, Mr Zeng also sent the Defendant’s Workers’ Wages Lists and the Defendant’s 7 October 2020 Calculation to Mr Hui and expressed his worry that problems might arise as he had no money to pay the workers who had been chasing him for their wages (at 4:47 pm –“4月份至7月份，出四次糧共53万，已经二個月未出糧? 伙記追紧我也無无再頂，惊出事先通知你下”).

(d)  On 16 October 2020 at 11:30 am and 1:47 pm, Mr Wong KL sent back to Mr Zeng the Defendant’s 7 October 2020 Calculation with his comments/markings made on it for Mr Zeng’s views (“Marked Defendant’s 7 October 2020 Calculation”).

(e)  On the same day, Mr Wong KT made a further attempt to liaise with Mr Zeng, and asked whether and when he would complete the remaining work, as no worker was working on that day at the Site. It was also mentioned in the messages between them that Mr Zeng had not been answering Mr Wong KT’s phone call and that Mr Zeng had not yet paid back the material costs to the Plaintiff:

At 8:04 pm - “居哥, 今日地盆師傅無開工, 你哋手尾幾時會有人去拾”

At 8:50 pm – “你用我公司戶口買英泥沙，我幫你付款， 請對對” and followed by “你未付款”

At 9:09 pm – “你電話唔聽，你哋手尾還完不完成下去”

At 9:10 pm– “逃避不是問題，有麼問題出嚟大家傾”

At 11:05 pm – “九月份，10月份幫你公司洗牆，掃口，拾手尾”

As appeared from the various WhatsApp Conversations in the trial bundles provided by the parties, no record of any specific response whatsoever from Mr Zeng could be found addressing the above.

(f)  On 23 October 2020 at 6:45 pm, Mr Wong KL sent a message to Mr Zeng, indicating that the Defendant’s workers’ wages had been paid temporarily on his behalf, and would demand the said payment back from the Defendant via finance company (“今日幫你暫支欠薪俾伙計，下星期我地會經財務公司追討你公司，你是無限公司，唔好以為唔聽電話或唔回應就可以”). The said message from Mr Wong KL was then forwarded by Mr Zeng to the Plaintiff and Mr Hui respectively.

(g)  It was only after receiving the said message that Mr Zeng started to respond and raise issues regarding the outstanding payments owed to him. In particular, he disputed that pricing for the work above 600 m² should be charged differently. The following is the exact wording of the first response that he made at 7:10 pm after receiving the above from Mr Wong KL at 6:45 pm – “可以，我有无同你公司簽約过當時只是給個價，當时话600米，超过數當然是不同價錢啦，你公司超过兩個月无出糧，我又无錢頂伙計當然會追，這個盤我也虧錢连伙計3成尾數要二十万左右，如果你想玩我等你，超過米數是我價数的，下星期虧錢我也會经人同你追来”. Again, the said message from Mr Zeng was also forwarded by Mr Zeng to Mr Wong KT. Similar messages were also sent by Mr Zeng to Mr Hui at 7:18 pm – “當時是6百米，超過數量是不同價錢，下星期我到地盤追討尾數”, and at 7:36 pm – “本來我想虧十幾萬就算，我入地盤所有伙记都有記錄出几多糧你的可以計下，他的 想玩那就同他的玩下”.

(h)  What followed afterwards that I can see from the WhatsApp Conversations were essentially arguments between Mr Wong KL on one hand and Mr Zeng on the other, each reiterating their respective positions.

(i)  The last record of the WhatsApp Conversations was a message from Mr Wong KT to Mr Zeng on 1 November 2020 which shows the further attempt made by Mr Wong KT to contact Mr Zeng in the hope to resolve the dispute between them – “阿居，你又玩這招，唔聽電話，你係唔係唔想解決這件事”.

13.During the aforesaid period from March 2020 to October 2020:

13.1  It is undisputed that the Defendant commenced work in April 2020 and the following 4 invoices (糧單) had been sent by the Defendant to the Plaintiff (collectively, “the 4 Invoices”).

Date as shown on the Invoice	Amount
1 May 2020	HK$162,000
10 July 2020	HK$263,140
19 August 2020 (ie July Invoice)	HK$285,940
27 September 2020 (ie August Invoice)	HK$193,600

It was accepted by Mr Zeng during cross-examination that the invoice dated 1 May 2020 was in relation to the work done by the Defendant in April 2020 (“the April Invoice”) whereas the invoice dated 10 July 2020 was in relation to the work done in June 2020 (“the June Invoice”).

13.2  It is the Defendant’s pleaded case there were other invoices issued to the Plaintiff (including one dated 22 June 2020 for the sum of HK$99,600[12], one dated 5 June 2020 for the sum of HK$143,100 (“5 June 2020 Invoice”) and an undated invoice for the sum of HK$205,800 (“Undated Invoice”)). The Plaintiff disputes that the one dated 22 June 2020 was not an invoice but a quotation. As to the other two, it is the Plaintiff’s case that he has never received them. Be that as it may, it was accepted by Mr Zeng during cross-examination that:

(a)  He should have issued a total of 5 invoices, including the 4 Invoices and the one dated 22 June 2020 mentioned above (which he believed, but was not sure, was the invoice for the work done in May).

(b)  The invoices sent, which were all prepared by him personally, were prepared in a way that each of the Monthly Invoices (as defined below) would reflect the aggregated amount of work he claimed to have completed (not just for that particular month). The invoiced amount, which he expected to be paid by the Plaintiff accordingly, would be arrived at by deducting the sum previously paid by the Plaintiff. (Though I note that during these lines of cross-examination, it was also Mr Zeng’s evidence that some work had not been invoiced yet (未上晒) as he was so requested by Mr Wong KT to do so separately). In other words, even if the invoice for May could not be ascertained, it did not matter as the work completed before would have been reflected in the later invoice, such as the August Invoice.

13.3  And, it is also undisputed that, as stated in the “Introduction” section in Section A above, a total sum of HK$530,000 has been paid by the Plaintiff to the Defendant by cheques as follows:

Date of Cheques	Amount
1 May 2020	HK$120,000
9 June 2020	HK$120,000
17 July 2020	HK$130,000
31 August 2020	HK$160,000
TOTAL:	HK$530,000

14.Eventually, the Plaintiff issued the writ of this Action on 14 January 2021.

15.Before I turn to consider the aforesaid issues and set out my views and findings on the evidence insofar as they relate to the issues, I shall briefly summarise my assessment of the witnesses.

D.  THE WITNESSES

16.In assessing credibility and finding facts, I adopt the following principles

16.1  As summarized by K Yeung J in Wah Sung Construction & Piling Limited v Cheer Wide Limited [2024] HKCFI 45 at §53:

“Counsel has cited to me a number of cases on the approach in assessing the credibility and reliability of witnesses. I remind myself when considering a witness’ credibility of the importance of considering the inherent likelihood or unlikelihood of the witness’ evidence, the consistency of the witness’ evidence with undisputed or undisputable evidence, with contemporaneous conduct and documents, the internal consistency of the witness’ evidence amongst their witness statements and with pleadings, and any material change of case. I need to consider the totality of the evidence. I remind myself that lies themselves do not necessarily mean that the entirety of that witness’s evidence is to be rejected. I warn myself against attaching undue weight on demeanour, though demeanour is obviously relevant when considering credibility.”

16.2  The Court bears in mind not only the witnesses’ demeanor in court, but also the history of events, the contemporaneous documents and the inherent probabilities of the witnesses’ accounts: Esquire (Electronics) Ltd v The Hong Kong and Shanghai Banking Corp Ltd [2007] 3 HKLRD 439 at 494C.

16.3  In Hui Cheung Fai and Anor v Daiwa Development Limited and Ors (HCA 1734/2009, 8 April 2014) at §§77, 81-82, it was aid by DHCJ Eugene Fund SC (as he then was):

“77. Generally speaking, contemporaneous written documents and documents which came into existence before the problems in question emerged are of the greatest importance in assessing credibility: Onassis v Vergottis [1968] 2 Lloyd’s Rep 403 at 431 (Lord Pearce) …

…

81. The practical approach to assessing credibility of witnesses in a case such as the present may have best been summarised by the words of Robert Goff LJ, as he then was, in The Ocean Frost [1985] 1 Lloyd’s Rep 1 at 57:

“Speaking from my experience, I have found it essential in cases of fraud, when considering the credibility of witnesses, always to test their veracity by reference to the objective facts proved independently of their testimony, in particular by reference to the documents in the case, and also to pay particular regard to their motives and to the overall probabilities. It is frequently very difficult to tell whether a witness is telling the truth or not; and where there is a conflict of evidence such as there was in the present case, reference to the objective facts and documents, to the witnesses’ motives, and to the overall probabilities, can be of very great assistance to a Judge in ascertaining the truth.”

82. Whilst these words were spoken in the context of a fraud case, I believe they are applicable to any case where a witness’s credibility features prominently in the court’s determination …”

16.4  Moreover, it is also well established that if a witness has told lies on a central issue, that may have a significant adverse impact on the credibility of his or her evidence as a whole: Progetto Jewellery Co Ltd v Lau Chiu Ying [2020] HKCFI 209 at §§28-31.

17.The Plaintiff has called 3 factual witnesses, the Plaintiff himself ie Wong KT, Mr Wong KL and Mr Wong Kin Kwan (黃建群) (“Mr Wong KK”) being one of the Defendant’s workers for the Project but subsequently engaged by the Plaintiff after the breakdown of the relationship between the parties. Despite the similarity of their names, there appears to be no dispute that they are not relatives.

18.As for the Defendant, they have called 2 factual witnesses. They are Mr Zeng and Mr Li Chi Ho (李志豪) (“Mr Li”), being another Defendant’s worker for the Project.

19.The Plaintiff and Mr Zeng of the Defendant are clearly the two key witnesses in this case who are directly involved in the negotiation of the Agreement and the Additional Works Agreement.

20.I generally find the witnesses of the Plaintiff credible and reliable:

20.1  Insofar as Mr Wong KT is concerned:

(a)  While there were occasions where he misremembered details of relevant event, including confusion of when the Agreement was formed, I accept the explanation offered by Mr Leung, that the negotiation of the Agreement occurred over a protracted period of time, and there might be difficulty of Mr Wong KT as a lay person to grasp the legal concept of the formation of the Agreement and to appreciate the nuances between mutual understanding and agreement, and the fact that there were different terms of the Agreement and agreement on each term might have been reached at a different point in time, was the likely contributing factor. His demeanour was generally upfront and believable.

(b)  Overall, his evidence was largely in line with the contemporaneous documents, his case on the factual dispute has been consistent throughout, and his evidence mostly remained unshaken during cross-examination and he appeared to be giving evidence fairly and to the best of his recollection.

20.2  As for Mr Wong KL, I find him to be a credible witness. He gave evidence fairly and to the best of his recollection. His evidence was essentially on the events that happened after 6 October 2020, where Mr Zeng sent a WhatsApp message to him expressing his intention not to continue to work at and to abandon the Site.

20.3  As for Mr Wong KK, I also find him to be a credible witness. There is no allegation that he has any financial interest in the outcome of the action. His evidence was mainly on events that took place from July 2020 onwards. They essentially include the fact that he had not been paid any of his wages by the Defendant since July 2020, the actions taken by the Defendant’s workers in chasing for their outstanding wages, and the fact that the Defendant had left many unfinished works, as the Plaintiff claims, when the Defendant abandoned the Site. He was not challenged on these matters, and I consider that I am entitled to proceed on the basis that his evidence in those respects was unchallenged.

21.In contrast, I am afraid I am of the view that the evidence given by the witnesses of the Defendant, particularly Mr Zeng, is generally unreliable:

21.1  As will be apparent from the next section, the stance taken by the Defendant in these proceedings has been inconsistent. There are many aspects of by Mr Zeng’s evidence which are unsatisfactory and contrary to the objective facts and inherent probabilities. For instance, Mr Zeng purported to suggest that the Agreed Trades exceeding the area of 601.68 m² as stated under the 7 April 2020 Quotation[13]should be charged on Man-Day basis, and it was his evidence that the exact area of 601.68 m² was derived from the Layout Plan. Yet, his answer during trial shows that he was even unclear how the Layout Plan should be read. In particular, when he was pointed out that the areas in the Layout Plan added up to 641.86 m² instead, no satisfactory answer was given apart from lamely claiming that he made a mistake when he made the calculation. I regard this aspect to be a major matter which Mr Zeng could not have mistaken. Further, it is undisputed that in the invoices that were issued by him to the Plaintiff to demand for payment, works of the Agreed Trades exceeding the area of 601.68 m² remained to be charged based on Agreed Rates but not Man-Day basis. Mr Zeng purportedly claims that those were just “virtual figures” (虛擬費用) stated therein at the request of the Plaintiff. I have difficulty in understanding the rationale behind such request (as claimed by the Defendant) and why Mr Zeng would accede to such a request. He was guarded in his explanation, particularly as to why he would nonetheless demand payments as per those invoices and expected to be paid accordingly. He then claimed that he was asked by Wong KT to issue separate invoice for the Agreed Trades that exceed 601.68 m² to reflect the true figure, but no such further invoice had been issued (at least not from the evidence provided the Court). His demeanour when answering this line of questions were evasive and he often gave answers which were indirect or equivocal.

21.2  As for Mr Li, I notice that before he was pointed out by Mr Leung during cross-examination that he confirmed in §6 of his witness statement that he himself made a complaint directly to the Plaintiff for the unpaid wages, he had indeed twice firmly denied that he had done so. After he was so pointed out, his evidence was then that he could not recall the timing as to when he made the complaint to the Plaintiff. Regarding the events that followed, his evidence was vague. He could not recall how the complaint was made to the Plaintiff and when Mr Zeng attempted to stop him and other workers from making a complaint. It was his evidence that insofar as the scope of the Agreement and/or the Additional Works Agreement and the extent of works that had been completed are concerned, the source of the information was from his then employer Mr Zeng, ie hearsay evidence, and he just worked according to Mr Zeng’s instructions. I must exercise caution in respect of his evidence.

22.In all, where the evidence between the Plaintiff’s witnesses and the Defendant’s witness differs, particularly between Mr Wong KT and Mr Zeng, I would prefer that of Mr Wong KT and the Plaintiff’s witnesses.

E.  DISCUSSION ON THE ISSUE

E1.  Issue 1 - The formation of the Agreement - Whether the agreement between the parties (“the Agreement”) was made orally and as evidenced by the Defendant’s written quotation dated 7 April 2020 (Item 3 of Plaintiff’s List of Documents), OR made by the Plaintiff’s acceptance of the Defendant’s written quotation dated 7 April 2020 (Item 1 of Defendant's List of Documents)?

23.The Plaintiff’s case is that the Agreement was oral, evidenced by the Plaintiff’s version of the 7 April 2020 Quotation. The Plaintiff explicitly denies receiving the Defendant’s version of the 7 April 2020 Quotation. The Plaintiff says that the March Quotation was a precursor to the Plaintiff’s version of the 7 April 2020 Quotation. It was issued upon the Plaintiff’s request because the March Quotation did not include rectification and cleaning, the location of the Site, and because the unit adopted for the Agreed Trades was “井” instead of meter (米數). The Plaintiff argues that because the Plaintiff’s version of the 7 April 2020 Quotation was a “simple document”, the terms must have been established through oral discussions occurring around the time of issuance.

24.On the other hand, the Defendant initially admitted to the existence of an oral agreement evidenced by the quotation in its original defence but subsequently amended its pleading to rely purely on the issuance and acceptance of the Defendant’s version of the 7 April 2020 Quotation.

25.I have no hesitation in rejecting the Defendant’s pleaded case. The formation of the Agreement is a fundamental issue and parties ought not to be uncertain about it. However, the Defendant’s case has been inconsistent. Indeed, the Defendant, through the opening submissions of its counsel, further attempted to change its stance again in suggesting that the Agreement is constituted by the Defendant’s version of the 7 April 2020 Quotation and “the parties’ oral agreement…” and also putting to Mr Wong KT that there was some kind of oral agreement regarding the settlement of the invoice. The fact that the Defendant has been going back and forth in this regard has made its case incredible. In any event, as submitted by Mr Leung, which I agree, the Defendant should not be allowed to put forward such a version of oral agreement which has not been pleaded or stated in any of its witness statements.

26.Reading the Amended Defence and Counterclaim (“ADCC”) as it is, the pleaded case of the Defendant, as submitted by Mr Leung, is that the Defendant’s version of the 7 April 2020 Quotation was the sole source of the contractual terms:

26.1  While it is not disputed that the only difference between the Plaintiff’s version of the 7 April 2020 Quotation and the Defendant’s version was minor/negligible in that the last line in the former version read “包手尾清洁” whereas the corresponding part of the latter reads “一般 = (手尾清洁),” it transpired in the course of the cross-examination of Mr Zeng that the Defendant’s version of the 7 April 2020 Quotation only came into light and was sent to the Plaintiff in early May 2020. This was, allegedly, because he was then requested by the landlord to additionally do “抆口” to the tiles, and such process would enhance the difficulty in cleaning (“ ‘抆口’ Justification”). However, there was no explanation on how the Defendant’s version was sent, and there was no record from the WhatsApp Conversations that such version was sent to the Plaintiff. The “抆口” Justification was never mentioned before and was in fact different from the explanation he gave in his supplemental witness statement (“Zeng Supp WS”) at §8. And if what Mr Zeng said in Court is right, then the material facts pleaded in the ADCC (at §3.2(a)) that such quotation was issued “to the Plaintiff on or around 7 April 2020” could no longer be true. The Defendant’s pleaded case is contradicted by Mr Zeng’s evidence in Court.

26.2  Further, even assuming that there was an agreement reached based on the Defendant’s version of the 7 April 2020 Quotation, the said quotation is clearly a simple and short document as follows:

“龍山建築工程公司

LUNG SHAN CONSTRUCTION COMPANY

…

九肚山屋仔(地盤)

外垟．批盪 (打餅仔、包角) 包英泥沙

实數 : 601.68 米² x 360 $ = 216,604 $

外垟．AGT 瓦仔:

实數 : 601.68 米² x 300 $ = 180,504 $

总數 : 397,108 $

一般 = (手尾清洁)”

It does not in any way, and it is doubtful how it itself could be considered to have, contain the terms as alleged by the Defendant, be it the details about the cleaning and defect rectification (as pleaded in the ADCC at §4.2), the timing for the settlement of the monthly invoice (as pleaded in the ADCC at §4.4(a)) or that the scope of the work under the Agreement was based on the Layout Plan provided by the Plaintiff back in March 2020 (as pleaded in the ADCC at §5).

27.The aforesaid further shows that the Defendant’s case in this regard is inherently contradictory. The lack of detail in the quotation on 7 April 2020, be it the Plaintiff’s version or the Defendant’s version, necessitates reliance on oral discussions to establish the full terms, and lends credence to the Plaintiff’s case instead.

28.Accordingly, I find that the Agreement was made orally and as evidenced by the Defendant’s written quotation dated 7 April 2020, ie Plaintiff’s version of the 7 April 2020 Quotation.

E2.  The Terms of the Agreement

E2(1).  Issue 2 - Whether the Agreement was a Measurement Contract or a Lump Sum Contract

29.It is the Plaintiff’s case that the Agreement was a “measurement” contract where the total sum HK$397,108, based on 601.68 m², was an approximate and estimated figure. Subject to remeasurement, the final sum payable by the Plaintiff to the Defendant would be calculated by multiplying the actual area of the external wall done with the Agreed Rates.

30.The Defendant contends the Agreement was a “lump sum” contract totaling HK$397,108 based on the agreed area of 601.68m². Mr Kwan submitted that the 601.68m² area acts as a watershed or dividing line, meaning any work exceeding this area must be charged separately as Additional Works at the rate of HK$1,600 per Man-Day. The Defendant justifies this approach by arguing that complexity increases as the service area increases, potentially escalating miscellaneous costs, which made the Agreed Rates unsuitable for the area exceeding 601.68m² (“Excess Area”).

31.For the reasons I shall endeavour to state, I am of the view that the Agreement was a Measurement Contract, rather than a Lump Sum Contract.

32.First, the Defendant’s repeated contemporaneous conduct of issuing invoices applying the Agreed Rates to work exceeding the 601.68 m² boundary provides concrete evidence of a measurement basis being agreed or acted upon by both parties:

32.1  That can be seen in the June Invoice, the July Invoice and the August Invoice:

June Invoice	Rendering/ Plastering	804 m2 x $360 = $289,440
	Laying of tiles	410 m2 x $300 = $123,000
July Invoice	Rendering/ Plastering	804 m2 x $360 = $289,440
	Laying of tiles	650 m2 x $300 = $123,000
August Invoice	Rendering/ Plastering	830 m2 x $360 = $298,800
	Laying of tiles	800 m2 x $300 = $240,000

32.2  The Agreed Rates were also applied in the 5 June 2020 Invoice and Undated invoice, which the Plaintiff, as stated in Section C above, denies having received:

5 June 2020 Invoice	Rendering/ Plastering	700 m2 x $360 = $252,000
	Laying of tiles	253 m2 x $300 = $45,900
Undated Invoice	Rendering/ Plastering	700 m2 x $280 = $196,000
	Laying of tiles	150 m2 x $300 = $45,900

While the rate adopted for “Rendering/ Plastering” in the Undated Invoice had somehow become $280, instead of $360, what is relevant for the present purpose is the fact that such invoice also adopted a measurement basis.

32.3  The Defendant argues that Mr Zeng was instructed by the Plaintiff to write the invoices in such a way and was told to claim the “additional amounts separately”. I do not accept such an explanation:

(a)  To start with, that is not the Defendant’s pleaded case. The suggestion that the figures stated in the aforesaid invoices was some kind of “virtual” figure (虛擬費用) only appeared for the first time in Zeng Supp WS at §17, but not in the ADCC.

(b)  To the contrary, at §6.2A of the ADCC, it was specifically pleaded that those figures stated in the aforesaid invoices reflected the “correct particulars”, and were “Amount requested by the Defendant on the Monthly Invoices”. It was even pleaded at §6.2B of the ADCC that the Plaintiff was in breach of agreement for “consistently failed to pay the Monthly Invoices in full...”. It is hardly debatable that the invoices and the amounts stated therein were expected to be the basis on which the Defendant would be paid for, and in any event, Mr Zeng confirmed the same during cross-examination.

(c)  As submitted by Mr Leung, Mr Zeng was not an employee, subordinate, or puppet of the Plaintiff, and Mr Zeng was not bound to accept the alleged suggestion which was both unreasonable and contrary to his alleged understanding of the Agreement. I agree.

(d)  After all, it is difficult to see how the Defendant could, on one hand, seek to claim the amount as per the invoices sent, with works exceeding the 601.68 m² calculated based on a measurement basis, but at the same time, claim any “additional amounts separately”. It also remains unclear how those “additional amounts” were to be calculated and claimed, and how to reconcile the said amounts with the sum for the rendering/plastering or tiles laying work exceeding 601.68m² which were supposed to be, as alleged by the Defendant, calculated on a Man-Day basis. It would create chaos in reconciliation, the Interim Payments (as defined below), as well as the final account, and it is illogical that the parties would adopt such an approach.

32.4  In my view, this reason itself is sufficient for me to conclude that the Agreement was a Measurement Contract and to reject the Defendant’s case for this issue.

33.Secondly, it should be noted that the precursor March Quotation demonstrated that the Defendant was content to contract based purely on unit rates before knowing the exact area. In that quotation, in gist, only the rates for doing the Agreed Trades were stipulated therein. And, having considered the evidence given by Mr Zeng during the cross-examination and cross-referencing the same with the WhatsApp Conversations, it is apparent that back at the time the March Quotation was issued, he had no knowledge of where the Site was, let alone the area to be covered. I accept the fact that Mr Zeng was willing to issue such a quotation would at least support the Plaintiff’s proposition that the Defendant was content to carry out the Agreed Trades based on rates on a pro rata basis regardless of what the areas that needed to be covered, and thus casts doubt on the Defendant’s case that the Agreement was a Lump Sum Contract.

34.Thirdly, it is the submissions of Mr Kwan that the area of the Agreed Trades was a significant factor for the Defendant to consider his quotation for the services. It is certainly more so for a lump sum contract (as per the Defendant’s case) which should reflect the entirety of the scope of agreed works (just to cover contractual area of 601.68 m² ) and define the corresponding price for such works:

34.1  In that respect, the Plaintiff’s case is all along that the Layout Plan was sent to the Defendant merely to facilitate the Defendant to make measurements and to prepare the quotation. The Layout Plan was sent for the Defendant’s reference as the Plaintiff emphasized to Mr Zeng that the said plan was only the Plaintiff’s estimation of his work at the site, and his work was different from the work for which the Defendant was to be engaged.

34.2  In contrast, the Defendant’s case appears to be shaky:

(a)  While it is the Defendant’s pleaded case that the Defendant’s version of the 7 April 2020 Quotation was prepared “based on” the drawings, ie the Layout Plan provided by the Plaintiff, it is worth noting that Mr Zeng had at one stage during cross-examination admitted that the Layout Plan was given to him only for his reference (參考), but later retracted from such admission, insisting instead that the Layout Plan was the “standard” (標準), and attempted to explain his inconsistency by suggesting that the March Photos were for reference, while the Layout Plan was the standard.

(b)  And, in the closing submissions, the Defendant’s case goes back to “the Defendant prepared his Quotation[14] with reference to the area as shown on the [Layout Plan]”.

34.3  In any event, it is the Defendant’s case that the Layout Plan was the source which the Defendant referred to for setting out the parameters of the work under the 7 April 2020 Quotation. Yet, as appears from Mr Zeng’s testimony in court, he was not familiar with such a key document at all:

(a)  The Layout Plan depicted the four elevations of the 3 Houses with some smaller rectangles within the elevations. While it was eventually agreed by Mr Zeng that those areas of the smaller rectangles should be deducted from the calculation of the total areas of the respective elevations as no work needed to be done for the areas covered by those smaller rectangles, Mr Zeng’s initial testimony was somehow saying otherwise. I do not think Mr Zeng could have made such a mistake regarding the understanding of such a key document when it was allegedly his case that such Layout Plan was the “standard” as to how he derived the exact scope of the Quotation.

(b)  Likewise, there was no satisfactory explanation other than the lame answer (as stated in §21.1 above) as to how he came up to set the parameters of 601.68 m² in the Quotation when the total areas as depicted in the Layout Plan in fact added up to 641.86 m² instead.

35.Fourthly, certain key propositions were raised by Mr Leung regarding the Plaintiff’s version of the 7 April 2020 Quotation in the course of the cross-examination of Mr Zeng. Mr Zeng accepted that: (1) Regardless of what area was stated in the quotation, there was a mutual understanding between the Plaintiff and Defendant that Defendant would do all the rendering/plastering or tiles laying works for all 3 Houses; (2) Wong KT told him numerous times during the site visit prior to the issuance of the said quotation that his quotation must be “到價”, which I accept to mean that Mr Zeng should make sure the Defendant would make a profit or at least not make a loss by such quote; (3) The area stated in the said quotation was just an approximate area:

35.1  It is also not in dispute that it was only on or about 28 April 2020 that Mr Zeng made a detailed measurement of the area that needs to be covered by the 3 Houses and he did not make any measurement of the 3 Houses prior to that.

35.2  With such mutual understanding regarding the scope of the work at the time the Plaintiff’s version of the 7 April 2020 Quotation was sent, one would expect that any quotation made and any agreement reached by then would be one that could encapsulate the scenario for completing the work for all 3 Houses. A “lump sum” contract as alleged by the Defendant could not possibly achieve the same in the absence of any detailed measurement on the Site. This is particularly so when Mr Zeng accepted that the area of 601.68 m² stated in the said Plaintiff’s version of the 7 April 2020 Quotation was just an approximate figure, and I find on balance that despite the word “實數” or “總數” was adopted in the said quotation, the sum stated therein was just an estimated figure based on an approximate area and agreed unit rates, ie the Agreed Rates. In my view, that also explains why, as per the evidence of Mr Wong KT, Mr Zeng remained silent and raised no objection during the on-site meeting upon hearing the suggestion to reimburse Mr Zeng on a “實量實度 ” basis for the difference in area, ie the estimated area of 601.68 m² vs the Defendant’s Measured Area of 824.5775 m² (that was subsequently discovered upon the Defendant’s detailed measurement) – because the consensus they had all along was that the Agreement was a Measurement Contract and the “實量實度 ” method fell within the tenor of such contract. It follows that the corresponding objection raised by the Defendant in the closing submission on “unpleaded variation of contract” is a non-issue.

35.3  On the other hand, Mr Zeng’s account on how the difference in the area of the works that needed to be done should be reimbursed is convoluted and should be rejected:

(a)  Mr Zeng initially admitted that the difference would be reimbursed as per the area, but later retracted and testified that it would be reimbursed by Man-Day. When asked about the inconsistency, he seemed to be suggesting that both methods coexisted, and which method should be adopted would depend on the magnitude of the difference. He did not give a satisfactory answer as to what difference was deemed too big to warrant one method and not the other.

(b)  Mr Kwan, at §6 of the Defendant’s Reply Submissions, drew my attention to the transcripts of the cross-examination of Mr Zeng and highlighted the fact that Mr Zeng expressly denied the rendering/plastering or tiles laying works for area exceeding 601.68 m², ie Excess Area, would be charged by “unit price” (單價), and he also explained that the costs would be “charged by area” (以面積嚟計). While Mr Kwan submitted that reading Mr Zeng’s answers in context, Mr Zeng could not mean that the price for the additional rendering/plastering or tiles laying works would be calculated by multiplying the Excess Area by the Agreed Rates given his earlier express denial, but I could not see how it could be in line with the Defendant’s case in reimbursing the difference by the Man-Day method either. “Area”, in my view, has no relevance to calculation by “Man-Day” which is calculated by multiplying the number of days incurred and/or number of workers utilized to complete the task by the unit Man-Day rate. Indeed, Mr Zeng’s answer that he would be compensated with reference to the actual work done (“做幾多俾幾多”) could likewise apply to being compensated by reference to the area covered.

(c)  I also note that Mr Zeng’s explanation as to why he would not agree to charge the additional area by unit rate was because more area might lead to further miscellaneous matters (“多面積就有多𠮩𠹌嘢出嚟” ) only appeared for the first time in these proceedings when he was being cross-examined, but never in his witness statements. In any event, in the absence of any expert evidence, I am not equipped with sufficient evidence to come to any view regarding the same, or the validity of the alleged commercial reality based on the idea of economy of scale, as suggested by Mr Leung, in the circumstances of this case either. That said, I agree with Mr Leung’s closing submissions that Mr Zeng had not given any convincing answer as to why the Excess Area should be reimbursed on a totally different basis when the measurement basis was readily in place at the material time.

E2(2).  Issue 3 - Under the Agreement, which party shall be responsible for providing cement and sand?

36.The Plaintiff’s position is that he would supply the cement and sand but the costs would be deducted from the final payment to the Defendant. The sum originally claimed by the Plaintiff was HK$47,964, but Mr Leung conceded during the opening submissions that due to duplication discovered when reconciling the material receipts, the total costs claimed should be revised down to HK$35,360.

37.Mr Kwan confirmed during the oral closing submissions that the Defendant no longer disputes that they are liable to pay the said costs of cement and sand supplied by the Plaintiff in the sum of HK$35,360, and I so find.

E2(3).  Issues 4 and 5 - What were the payment terms under the Agreement? Whether the implied terms as pleaded by the Plaintiff existed?

38.Given that the implied terms as pleaded by the Plaintiff under Issue 5 concern the payment terms under the Agreement, it can be dealt with together with Issue 4.

39.The Plaintiff’s primary case is that under the Agreement, there was an express oral term that the Defendant would submit a monthly invoice of the alleged work done (“Monthly Invoice(s)”), and the Plaintiff would pay a portion of the fees claimed in the invoices (“Interim Payment(s)”), subject to the final calculation of the actual work done. While the Plaintiff accepts that there was no express agreement on the timing of the payment, there is a trade custom in the construction industry that the payment should be made within 14 days.

40.The Defendant admits that Monthly Invoices would be issued to the Plaintiff, but in the course of these proceedings, the Defendant has advanced 3 different versions of payment terms:

40.1  The first version, being the pleaded case in the original Defence and Counterclaim, was that the Plaintiff would pay the Defendant the full amount claimed in the Monthly Invoice forthwith.

40.2  The second version, as seen from the original Joint Scott Schedule, was that there was a “usual practice” that the Plaintiff was to pay 90% of the Defendant’s fee claimed in the Monthly Invoice, leaving the remaining 10% to be paid in accordance with the final calculation of the actual work done.

40.3  The third and final version, being the pleaded case in the ADCC, is that the Plaintiff would pay the Defendant the full amount claimed in the Monthly Invoice forthwith, and in any event no later than 5 days from the date of issuance thereof (“Final Pleaded Version on Payment”).

41.To start with, it is inexplicable why 3 different versions of payment terms were advanced by the Defendant. Mr Zeng did not give any answer in these proceedings. The same was also not addressed by the Defendant in the opening submissions or closing submissions either. This gives rise to serious doubt on the truthfulness of the Defendant’s case.

42.Further, as stated above, it is the Defendant’s pleaded case that the Defendant’s version of the 7 April 2020 Quotation was the sole source of the contractual terms (which I rejected), and it is indisputable that the quotation does not contain any payment terms at all. Taking also into account the Defendant’s denial of any implied payment term, it is unclear on what legal basis the Defendant could rely on to assert its Final Pleaded Version on Payment.

43.In any event, as highlighted by Mr Leung, what is notable about the Defendant’s case is that, despite the fact that the Plaintiff’s Interim Payments made during the period in May 2020 to August 2020 were less than 100% or 90% of the invoiced amounts, and despite the fact that those payments were not made forthwith or within 5 days of the invoices as required under the Defendant’s various versions of payment terms, there were no contemporaneous records of any complaints made by Mr Zeng back then. While there were requests for more payments in late August 2020 as appeared from the transcript of the WhatsApp voice messages in late August 2020 provided by the Defendant (see §12.10(g) above), I have reservation whether those requests or complaints were based on any breach of the Defendant’s pleaded payment terms (as the Defendant claimed), or whether Mr Zeng was just begging for help given the wordings used such as “呀老細，幫幫手啦” and “當借埋比我啦，我本身就蝕埋錢啦…”. In a sense, this line of messages indicates that Mr Zeng accepted that, at that time, he was yet not entitled to full payment under the July Invoice. Mr Zeng might be firm during his oral testimony at trial that the Plaintiff needed to settle the full amount of the invoices immediately or within 5-6 days after the issuance of the Monthly Invoice, but that assertion was not borne out by any of the contemporaneous records available prior to the breakdown of the relationship.

44.In contrast, the Plaintiff’s version has been consistent throughout (save for the inconsistency as to the mode of oral communication which I, on balance, accept to be minor and in view of my assessment of Mr Wong KT’s credibility), tallies with the course of conduct as revealed from the contemporaneous records where Monthly Invoices were issued followed by payment of a portion of the fee claimed in the invoices, and is also in line with the previous practice for the CU Project where the Defendant was only paid in full after the completion of works. I also note that Mr Zeng admitted that there was a trade custom in the construction industry for a contractor to pay only a portion of the invoiced amount (although he denied that the deduction should be determined by the Plaintiff). On balance, I accept that there was an express term under the Agreement as advanced by the Plaintiff. While there was no clear formula defining the retention amount, I am of the view that the Plaintiff’s retention system — based on the Plaintiff’s assessment of the work completed by the Defendant and deductions for materials costs — was not arbitrary but made greater commercial sense than the terms suggested by the Defendant in the particular circumstances of this case.

45.In light of my finding that there were such express oral terms, I do not consider it necessary to deal with the Plaintiff’s alternative claim to imply such a term into the Agreement by usage or custom.

46.However, following my rejection of the Defendant’s case on the timing of payments and my preference for Mr Wong KT's evidence over that of Mr Zeng, in view of the impression of their credibility (as stated in Section D above), there would be no express term on the timing of payment agreed between the parties under the Agreement. Bearing in mind the well-established principle for implying a term into an agreement as set out in Kensland Realty Ltd v Whale View Investment Ltd & Anor (2001) 4 HKCFAR 381 at §23, per Bokhary PJ[15], in the absence of an express term on the timing of payment, it is obvious and/or necessary to give business efficacy to imply in the Agreement, which is a construction contract, a term that the Plaintiff would pay such Interim Payment within a reasonable time after the receipt of the invoices: see also Chitty on Contracts, 35^th Ed, Vol 1, §§17-006 to 17-013, §40-218.

E3.  Works outside of the scope of the Agreement (“the Additional Works”)

47.Although the parties have addressed Issues 6 to 9 together in their respective closing submissions, I will deal with Issues 6 to 7 first, followed by a brief discussion of Issues 8 and 9 separately.

48.In light of my findings to Issues 1 and 2 above, works other than (i) rendering/plastering and laying of tiles, ie the Agreed Trades, would be regarded as Additional Works. But before looking further into the scope of the Additional Works as agreed between the parties, it is essential to first consider how the Additional Works are agreed upon.

49.According to the Plaintiff’s case as pleaded in §4A of the Amended Statement of Claim (“ASOC”), the parties agreed that the Defendant would first submit fee quotes for the Additional Works and would only proceed to carry out such work upon the Plaintiff’s approval, and the Defendant would be paid according to the fee quote and/or actual number of “Man-Day” incurred.

50.The Defendant takes particular issue with the phrase “according to the fee quote and/or the actual number of “Man-Day” incurred by the Defendant” and alleged the Plaintiff was pleading two distinct ways to charge the Additional Works but changed to just being charged based on the Man-Day incurred during the trial. I do not follow this argument.

50.1  As submitted by Mr Leung in his reply closing submissions, and with which I agree, “fee quote” and “Man-Day” are not mutually exclusive concepts, and fee quotes may be expressed in terms of “Man-Day”. A clear example is the document dated 22 June 2020, which was no longer disputed by the parties at trial to be a quotation for works in relation to Houses 32, 33 and 34 for the total sum of HK$99,600 (“22 June 2020 Quotation”). In that quotation, the fee quotes were expressed in terms of “Man-Day”, and the material costs, which could not be expressed in “Man-Day” terms, were separately stated.

50.2  Mr Kwan refers to and compares §19 of Mr Wong KT’s supplemental witness statement (“Wong KT Supp WS”) with Mr Wong KT’s viva voce evidence at trial. In §19 of Wong KT Supp WS, his evidence was that “…我要求曾永居在 WhatsApp 影相給我講明會做那些工序, 並要求他書面報價給我”. Mr Kwan submits that this illustrates it is the Plaintiff’s claim that certain items were charged by “quotation” with specific amounts of HK$16,000 and HK$22,000. And with reference to a certain extract of Mr Wong KT’s evidence during cross-examination at §22 of the Defendant’s Closing Submissions, Mr Kwan then submits that the previous line of argument was no longer maintained by Mr Wong KT and that he was instead admitting that the works were charged by Man-Day.

50.3  With respect, I think Mr Kwan has misconstrued what was said by Mr Wong KT at the said §19 of Wong KT Supp WS. I agree with Mr Leung’s submissions that the Plaintiff did not say that the quotation of HK$16,000 and HK$22,000 were not based on Man-Day. He did specifically state that he requested Mr Zeng to send him photos via WhatsApp as to what work was required to be done (我要求曾永居在 WhatsApp 影相給我講明會做那些工序, 並要求他書面報價給我), and there were, indisputably, photos of that nature sent by Mr Zeng to the Plaintiff via WhatsApp, with brief descriptions of the work and the Man-day required.

50.4  In any event, the extract of Mr Wong KT’s viva voce evidence during cross-examination, as included in §22 of the Defendant’s Closing Submissions, was incomplete. The more complete transcript reads as follows:

“Q: 33屋嗰2萬2千，你記唔記係點報價？曾生係點將個價報比你㗎?

Mr Wong KT:WhatsApp。

Q: 點WhatsApp？係佢寫咗？你記唔記得係乜嘢形式？點WhatsApp？即是話 寫著二萬二千咁呀？定喺？

Mr Wong KT: 唔係，佢寫幾工嘅基本上。佢上糧單，佢報價，係全部寫幾工嘅，寫幾多料嘅。咁其實我哋ok咗我哋就無特登去執翻嗰啲相出嚟。因我都願意俾囉，我點解要執翻啲相出嚟，去攪嗰啲嘢啫。都無諗到要打官司…

Q: 曾生話做咗幾多工啫？

Mr Wong KT: 唔係，佢報價，其實佢WhatsApp 比我嗰張紙有寫住，譬如話嗰個位置要做三工，幾多磚，幾多嗰啲嘢……

Q: 即係有將相？

Mr Wong KT:有張相，喺嗰WhatsApp 嗰度…”

Reading the said extract in its full context, Mr Wong KT’s evidence was in fact that the WhatsApp photos, with Man-Day stated therein, were part and parcel of the fee quotation and constituted the basis of that quotation. It does not follow from such evidence, as submitted by Mr Kwan, that “Effectively, P’s evidence is now reduced to the Additional Works that would always be paid by the Man-Days incurred by D…”.

51.After all, it is not disputed between the parties that the Defendant was required to take photos at the Site and provide the quotation for each Additional Work the Defendant was going to conduct, and it was not disputed that the Defendant should only conduct the Additional Works after getting the Plaintiff’s approval (“the Undisputed Arrangement”).

52.However, the parties are in dispute, as I see it, as to what has been agreed by the parties to be carried out as Additional Works and what the Defendant is entitled to charge for the approved Additional Works:

52.1  The Plaintiff’s case is that only five items, totaling HK$171,800, were approved by the Plaintiff and agreed by the parties as Additional Works, and that the Defendant was not entitled to charge the Plaintiff more than that amount (“5 Additional Items”):

(1)	Additional Works in May 2020	HK$27,000
(2)	Moving of tiles (500 boxes)	HK$7,200
(3)	Chiselling of concrete, etc.	HK$99,600
(4)	Variation works for House 32	HK$16,000
(5)	Variation works for House 33	HK$22,000
	TOTAL:	HK$171,800

52.2  The Defendant contends the agreed scope was much wider (which P denies), and says that it had performed Additional Works totaling HK$808,664. Besides the two Agreed Trades, it also encompasses works including cutting of tiles/corner cutting of tiles, water proofing, floor plasterings, metal cutting, bricklaying, concrete hacking/chiselling, tile grouting, modification of tiles, surveying, loading, management of work site, and provision of bricks and sands. And for such Additional Works, it is the Defendant’s case that they should be charged according to the actual manpower incurred and the Defendant is entitled to claim beyond the invoices, and also for the costs and expenses arising from such Additional Works (“Defendant’s Scope of Additional Works”).

53.The 5 Additional Items were exactly the amounts of the respective items shown on the Defendant’s July Invoice and August Invoice. These invoices were undisputably prepared by the Defendant and were sent to the Plaintiff as a demand for payments, and there is, and could in any event be, no issue that these 5 Additional Items were approved Additional Works. And I so find. But as to the Defendant’s Scope of Additional Works, why were most, if not all, of such extra additional costs over and above the amounts derived from the 5 Additional Items (and the Agreed Trades) that covered works from April 2020 onwards which the Defendant claims it is entitled to claim beyond, and thus should have been approved, not so reflected in the Monthly Invoices or even the Defendant’s 7 October 2020 Calculation at all? I, from the evidence available, do not see any satisfactory answer to that.

54.As rightly submitted by Mr Leung, there is no convincing reason why some Additional Works did not require quotation from the Defendant, but for some Additional Works, quotations were required. The arrangement that required quotation and approval, which is undisputed by the parties, made commercial sense in the circumstances of this case when the Plaintiff, which I accept to be just a contractor but not main contractor or the landlord, would have had no money to pay the Defendant for the Additional Works unless the main contractor or the landlord paid him.

55.To justify the claim for the Defendant’s Scope of Additional Works, the Defendant has produced:

55.1  Various photos of the Site, including those in the trial bundles entitled in the index as “Copy Photographs of the worksite” and “Copy annotated photographs of the worksite” and a Working Bundle;

55.2  Man-day Record for July 2020 to September 2020;

55.3  Cheques representing payment of wages to the workers by the Defendant; and

55.4  Bank Statements of the Defendant.

However, no cross-referencing was offered by the Defendant of these documents and it is in any event, as submitted by Mr Leung which I agree, extremely difficult, if not impossible, to correlate them with the Defendant’s Scope of Additional Works as pleaded in the ADCC and in the Amended Joint Scott Schedule.

56.Further, bearing the Undisputed Arrangement in mind, there is no evidence from the Defendant as to how specifically the agreement was reached or approval was obtained for the items Surveying (平水墨斗) for a sum of HK$75,000; loading (上料) for a sum of HK$70,000, and management of the work site (地盤管理) for a sum of HK$50,000. They were also not, or at least do not appear to be, charged based on the Man-Day basis as agreed between the parties for the Additional Works. All that the Defendant said for the amount charged for these items was just that, as per §38(d) of Zeng Supp WS “最後的「平水墨斗」、「上料」、「地盤管理」 的磚及泥沙均是因為額外工程而衍生的額外支出及材料費” and §41 of Zeng Supp WS “「平水墨斗」「上料」及「地盤管理」都是由龍山收取的一筆過收費，有關費用的銀碼均於早前獲得黃建鉄口頭確認和接受.”. For the Surveying (平水墨斗), while Mr Zeng testified during cross-examination that the work was done by a subcontractor and paid for by the Defendant, there was no invoice or receipt to substantiate the same.

57.The Defendant seeks to argue that, despite the Undisputed Arrangement, the reality is that the arrangement was less formal, and that there was in fact a consensus between the parties that the Defendant could charge the Additional Works based on the actual Man-day incurred for the work beyond the quotation. I reject this arguments:

57.1  The Defendant relies on another extract of Mr Wong KT’s evidence during cross-examination (included in §31 of the Defendant’s Closing Submissions). Unfortunately, the extracts were again inaccurate, and were taken out of context. The correct extracts of the corresponding parts should be as follows:

“Q: 譬如話223咁樣啦，呢一度佢嗰個WhatsApp記錄，就喺34號屋嗰個批盪1工咁樣。咁呢一個喺咪就你話嘅報價

Mr Wong KT: 係呀

Q:  咁呢個係邊個send俾邊個？

Mr Wong KT: 曾永居send俾我。

Q:  咁然之後你有沒有將呢個俾嗰個…

Court:  邊個send俾邊個？

Mr Wong KT: 曾永居WhatsApp俾我。

Q:  咁呢啲WhatsApp我哋唔續個逐個對啦，咁我想問一問你，你咁嗰個16000一萬六千同賣二萬二千，係咪就喺基於呢啲相砌翻出來嘅數？

Mr Wong KT: 有啲就係囉，因為太多，我都唔知點樣去砌俾你，有啲九萬幾，其實就一大喳，啫喺幾多號屋幾多張相砌翻出來九萬幾

Court：  唔好意思，我聽唔明,可唔可以講慢少少，你講多次

Mr Wong KT: 因為呢佢呢就一條數呢，譬如話嗰度一工，嗰度兩工，有啲就嗰度幾工咁樣砌翻一條數出嚟，去報價俾我嘅

Court:  啫喺跟翻啲相，每一個地方可能要整幾多工, 跟住就加番埋一齊

Mr Wong KT: 喺啦，跟住就出番一條數返嚟俾我哋囉

Court:  邊個出條數返嚟？

Mr Wong KT: 曾永居，嗰啲WhatsApp嗰啲後加數，嗰啲全部佢比我哋呀嘛，要收錢，同埋我哋同意咗呀嘛嗰啲，即喺嗰啲我哋都無,唔同佢拗，我哋都俾，嗰啲基本上我哋都會俾”

(Emphasis added)

Reading the evidence in the proper context, Mr Wong KT in fact did not say that he would pay whatever Mr Zeng claimed the Man-Days incurred. Instead, what Mr Wong KT said he would pay without argument (“唔同佢拗…嗰啲基本上我哋都會俾”) were those amounts that were stated in the quotation which the Plaintiff approved.

57.2  While it is true that, as submitted by Mr Kwan in §28 of the Defendant’s Closing Submissions, there is no evidence that the parties did maintain a systematic system of quotations, insofar as the 5 Additional Items are concerned (which the Plaintiff claims to be Additional Works), they are at least evidenced by the undisputed contemporaneous records of invoices prior to the breakdown of the relationship. Further:

(a)  There is also a record of the quotation for the HK$99,600 as mentioned earlier at §50.1 above (ie item 3 of the 5 Items).

(b)  As to the HK$16,000 and HK$22,000 for works regarding House 32 and 33 respectively (ie item 4 and item 5 of the 5 Items), I notice from the WhatsApp Conversations that:

(i)  There was a quotation-like photo being forwarded by Mr Zeng to the Plaintiff on 30 July 2020 at 8:52 pm (referred to at §12.10(f) above), and the said photo appears to be in relation to some work for House 32 with a breakdown for 10 Man-days of work which gave a sum of HK$16,000.

(ii)  There was also the 26 August 2020 Quotation (referred to earlier at §12.10(h) above) sent by Mr Zeng to the Plaintiff on 26 August 2020 at 9:25 pm, and that quotation appears to be in relation to some work for House 33 which was for a total sum of HK$22,282.

(c)  In contrast, the Defendant, as I stated in §§55-57 above, has not been able to justify the claims beyond the invoices the Defendant’s Scope of Additional Works.

57.3  In §34 of the Defendant’s Closing Submissions, Mr Kwan seeks to add up the photo quotations relating to the Additional Works for the 3 Houses respectively, and by comparing the resulting sums with those stated in the August Invoice, namely:

	Photo Quotations[16]	August Invoice
House 32	14.5 Man-days x $1,600 = HK$23,200	HK$16,000
House 33	25.5[17] Man-days x $1,600 = HK$40,800	HK$22,000
House 34	8 Man-days x $1,600 = HK$12,800	Nil

Mr Kwan seeks to demonstrate that there were some Additional Works not reflected in the invoice and that the Defendant therefore should be able to claim beyond the invoiced sums. Having considered all the evidence available in the round, I do not think the argument is valid.

(a)  It is clear that the 22 June 2020 Quotation for the sum of HK$99,600 in fact covered works for all the 3 Houses, with a specific break down of 16.5 Man-Days for House 32, 26.5 Man-Days for House 33 and 15.5 Man-Days for House 34. That could account for the shortfall which the Defendant attempts to illustrate by the comparison summarized in the table above.

(b)  Mr Kwan says that those Man-Days in the said 22 June 2020 Quotation should not be taken into account as the photo quotations only appeared after 22 June 2020 in the WhatsApp Conversations. However, I agree with Mr Leung that the said criticism was based on various unproven assumptions:

(i)  It was assumed that the 22 June 2020 Quotation was sent on 22 June 2020. However, there is no evidence this was so. No such record can be found in the WhatsApp Conversations. In fact, as Mr Leung pointed out, there are indeed examples elsewhere in the WhatsApp Conversations showing that the dates of the Defendant’s document did not coincide with the dates on which they were sent: eg the July Invoice, which was dated 19 August 2020, was only sent to Mr Wong KT on 23 August 2020.

(ii)  It was assumed that the Defendant must send the photos quotations before sending the 22 June 2020 Quotation. However, I accept that it is also possible that the 22 June 2020 Quotation, which was a summary of the works, was sent first, followed by the breakdowns illustrated by the photo quotations.

(iii)  It was assumed that Mr Zeng sent the photo quotations only after the 22 June 2020 Quotation, and Mr Kwan referred me to [C2/446-455] of the trial bundles, which show that some photo quotations were forwarded back to the Defendant on 29 June 2020. However, it can be seen from the WhatsApp Conversations that, as early as 23 June 2020 at 9:01 pm, Mr Zeng sent a total of 3 + 24 = 27 photos to Mr Wong KT, and I accept that from the silhouettes of those blurred photos, they do appear to be the photo quotations. More importantly, judging from the transcript of the subsequent voice messages on 23 June 2020 including messages discussing whether the sum of 90,000-odd included the cost of materials (At 9:09 pm - 你嗰D包唔包埋料呀?你嗰九萬幾係咪包埋英泥沙包埋磚呀?), followed by a request from Mr Wong KT to Mr Zeng to add the costs back in (At 9:14 pm - 咁你要加晒落去喎…) and Mr Zeng’s reply that he would do so later (At 9:16 pm- 好呀好呀，一陣我計條數加落去), together with the WhatsApp Conversations around that period, I consider it highly likely that the 1^st version of the 22 June 2020 Quotation (which did not contain the material costs) [18] was one of the 27 photos sent on 23 June 2020. I further consider that the versions including the material costs, ie the 22 June 2020 Quotation[19], was thereafter sent by Mr Zeng on the same day at 9:34 pm (as appears from the silhouettes of that blurred photo message). In my view, it may well be that the reason why some of those photo quotations were subsequently forwarded back by Mr Wong KT to Mr Zeng was to inform Mr Zeng that the quotations were approved.

57.4  As to Mr Wong KL’s WhatsApp voice message on 4 July 2020  and the WhatsApp messages between Mr Wong KT and Mr Zeng around 23-24 August 2020, neither, in my view, can be regarded as “strong” evidence to support the Defendant’s case that the Additional Works were charged by reference to the actual Man-Days incurred:

(a)  As regards the voice message of Mr Wong KL on 4 July 2020, the complete message is as follows:

“三呀，下個禮拜一呢，哈佬呀，會送磚過去九肚山，係啦，咁就你同下面講聲叫佢地幫手收收，咁就擺就擺返上次果個位置既，咁我同阿許生佢都講左啦，就話佢到時留返部大雞係度呢，幫手要黎吊啲物料既，如果唔係呢，果啲料呢就咁擔呢，擔到黎呢就咁擺係，即係第一批黎呢果啲磚果個位置既。如果想擔入少少呢，咁就要，即係我講左呢就要大雞黎擔呀，係啦，咁你同下面講聲啦喎。咁就如果係牽涉到少少，我諗内部運輸呢，係啦，咁果啲呢我就你同下面判頭講就，即係就唔好再計啦，因為你做地盤大家就知架啦，即係佢唔會擺你隔離架嘛啲物料，咁就少少内部運輸呢其實都要自己搞既，咁就你同佢講聲，如果爭咽一兩工大家唔好計呢啲，好嗎？唔該你” (emphasis added)

Mr Kwan, based on the underlined part of the message, submits that “This is clear evidence that P / HKP understood that D would normally charge P as per the actual Man-Days incurred”. “In this message, Mr. Wong was seeking D’s discretion not to charge the extra Man-Days caused by internal transportation of the construction materials”. However, looking at the messages as a whole, it is clear that the internal transportation being discussed had yet to be carried out. Mr Wong KL was apparently negotiating with Mr Zeng, seeking his agreement to waive the costs for any internal transportation that might be incurred arising in the future. The message was plainly a message that was sent before the relevant additional work was done, and no extra Man-Days had yet been “caused” or “incurred”. On the contrary, this, in a sense, provides yet another evidence that approval had to be obtained prior to the incurrence of extra costs arising from any Additional Works.

(b)  As regards the WhatsApp messages between Mr Wong KT and Mr Zeng around 23-24 August 2020, Mr Kwan submits that “D submitted the August invoice together with the workers’ “Man-Day” records [C2/39/477-478]. This is another clear indication that P understood that apart from the invoiced items, D would also charge him according to the actual Man-Days incurred. Otherwise, why did D submit the Man-Day records to him?”. To begin with, the workers’ Man-Day records were not sent together with the said “August invoice”, ie the July Invoice. It was only sent the following day. In any event, considering the said invoice and records in their proper context with reference to the transcribed voice messages exchanged at the time (referred to earlier at §12.10(g) above), I do not accept the messages, taken together, provide any indication, let alone “clear indication”, that the Defendant could charge the Plaintiff according to the actual Man-Days incurred on top of the invoiced items. Instead, it may well be that he was simply sending the Man-Day records to demonstrate that he was in financial difficulty, owing his workers their wages, and was, as stated earlier at §43 above, begging for help from the Plaintiff to pay more then he should (“呀老細，幫幫手啦，可唔可以加多幾萬比我啦，我真係唔夠出啦，我戶口又無咩錢啦…幾萬蚊我真係唔夠出啦，啲糧我出比人地…”). The further message pleading to treat the extra payment as a loan (“當借埋比我啦，我本身就蝕埋錢啦…”) reinforces that he was not asking to be paid for the Man-Days incurred.

58.For the above reasons, I answer Issue 7 in the affirmative and, as to for Issue 6, I find that the scope of the Additional Works covered only the 5 Additional Items for a total sum of HK$171,800.00.

E3(3).  Issue 8- Did the Plaintiff ever “borrow” the Defendant’s workers for carrying out the Additional Works?

59.Insofar as the question of whether the Plaintiff had borrowed the Defendant’s workers is concerned, the Plaintiff denies this. The Defendant, by its Reply Submissions stating that there “is no need to engaged in this futile debate”, essentially confirms that they no longer take issue regarding this matter, given that there is no dispute between the parties that the Defendant is entitled to payment from the Plaintiff under the item “五月份公司代工”, that is, item 1 of the 5 Additional Items.

E3(4).  Issue 9- What were the payment terms in respect of the Additional Works?

60.As to the payment terms of the Additional Works, the analysis and findings on Issues 4 and 5 apply equally to this issue. There is no commercial reason, and in any event no credible evidence, to support the Defendant’s case that there should be a different payment arrangement for the Additional Works (including the pleaded case in the ADCC at §4.2B(f) which required the Plaintiff to pay upon the Defendant’s requests “from time to time”) as compared with the Agreement. This is particularly so when all such matters relate to the same Project, and works under Agreement and the Additional Works, for which the Defendant demanded payments from the Plaintiff, were all set out under the same Monthly Invoice(s) in a combined total sum.

E4.  The Performance of the Agreement and the Additional Works

E4(1).  Issue 10 - What works have been performed by the Defendant under the Agreement and the Additional Works Agreement?

61.The Plaintiff’s case is that the work performed totals only HK$651,800. This breaks down into rendering/plastering work of 750m², giving HK$270,000 (being 750 m² x the Agreed Rates of HK$360/m²), laying of tiles of 700 m², giving HK$210,000 (being 700 m² x the Agreed Rates of HK$300/m²), and the agreed Additional Works of HK$171,800. The Plaintiff asserts that the Defendant left many works unfinished when the Defendant abandoned the Site in early October.

62.The Defendant asserts that it had not only fully completed the contractual work under the Agreement, which covers 601.68 m² for both the rendering/plastering work and the laying of tiles for the 3 Houses by the end of August 2020, but it had also completed the Defendant’s Scope of Additional Works. The Defendant claims it is thereby entitled to a total sum of HK1,205,772 (being the sum of HK$397,108 for the contractual work under the Agreement and the HK$808,664 for the additional works thereafter agreed). As a fall-back position, the Defendant asserts in the Defendant’s Closing Submissions that the Defendant has at least completed work valued at the sum of HK$787,500 in reliance of the Marked Defendant’s 7 October 2020 Calculation (“Fall-back Position”).

63.My findings above as to the scope of the Agreement and the Additional Agreement likewise apply to this issue, and, in light of those findings, the Defendant’s assertion is rejected. I also do not accept the Defendant’s Fall-back Position. Having taken all the evidence into account, I do not agree that the Marked Defendant’s 7 October 2020 Calculation amounts to any admission on the part of the Plaintiff. There is no evidence that Mr Wong KT made any admission to the calculation, and he specifically denied in cross-examination to have reached any agreement to the said calculation. Viewed in the context of the WhatsApp Conversations, and having regard to the explanation given by Mr Wong KL, which I accept, I am of the view that the markings made by Mr Wong KL was just part and parcel of negotiations between Mr Zeng and Mr Wong KL exploring options to alleviate Mr Zeng’s difficulty in paying his workers’ wages, but no agreement per se has been reached yet. In any event, the Defendant has never pleaded estoppel and has not made any reference to the Marked Defendant’s 7 October 2020 Calculation in the ADCC or even its witness statements.

64.What remains to be considered is merely whether the area performed by the Plaintiff under the Agreement was, as per the area admitted by the Plaintiff, 750 m² for the rendering/plastering work and 700 m² for laying of tiles. In my view, with the evidence available, this turns entirely on whether I prefer the evidence of the Plaintiff or that of the Defendant. The Defendant’s case is weakened by its heavy reliance on the unsubstantiated scope of work which I have found against. I have already expressed my impression of the credibility of the witnesses and will not repeat it herein, and taking also into account the following matters, I accept on the balance of probability the Plaintiff’s case:

64.1  It is the evidence of Mr Wong KT as set out in his Wong KT Supp WS at §24 that the 750 m² for rendering/plastering work and 700 m² for laying of tiles were based on measurements taken at the Site around the time when the Defendant indicated that it would abandon the Site. That evidence, which was specific, was not challenged by the Defendant during the cross-examination.

64.2  In contrast, there is no evidence that any measurement of the work performed has been carried out by the Defendant. Mr Zeng’s evidence on the area completed was, after all, unclear. All that he alleged in the Defendant’s pleading and his witness statement was that the additional area covered approximately 200m² (大約200平方米).

64.3  While the Defendant’s witness Mr Li did say in his witness statement (at §8) that it was his understanding that the area completed was over 800 m² (“據我理解，截至本人退出「該等工程」為止，「該等工程」連同原告人要求進行的額外工程所覆蓋範圍（已完成部份）達到800平方米以上，超出原告人及被告人原本同意的601.68平方米大約200平方米”), which appears to support the Defendant’s case, he admitted that his said understanding was based solely on what he had been told by Mr Zeng, and he further admitted he did not carry out any measurement in this regard.

64.4  I also note that the Plaintiff’s witness Mr Wong KL, when he was being cross-examined, specifically claimed to have observed that the area completed by the Defendant was way below the area which Mr Zeng claimed to have done. I further note from the contemporaneous WhatsApp Conversations between Mr Wong KL and Mr Zeng on 23 October 2020 that Mr Wong KL raised the concern that the areas claimed to have been completed by Mr Zeng were inaccurate and that many works were left unfinished (by reference to various photographs) (“多處未完成，上單面積錯誤”).

65For the above reasons, I conclude that under the Agreement and the Additional Works Agreement, the Defendant has performed the following works:

Works under the Agreement:
Rendering/ Plastering – 750m2 x $360/m2 = $289,440	HK$270,000
Laying of tiles - 700m2 x $300/m2 = $289,440	HK$210,000
Works under the Additional Works Agreement
The 5 Additional Items	HK$171,800
TOTAL:	HK$651,800

E4(2).  Issue 11- Was the Plaintiff in repudiatory breach of the Agreement and/ or the Additional Works Agreement by failing to pay the Defendant the amount due and doing so in a timely manner, allegedly paying wage to the Defendant’s workers without authorisation and making unwarranted threats to the Defendant?

65.As appeared from the Defendant’s pleading, the Defendant initially advanced 3 basis to claim that the Plaintiff was in repudiatory breach of the Agreement and/or the Additional Works Agreement:

65.1  Failing to pay the Defendant the amount due and doing so in a timely manner (“1^st Basis”).

65.2  Circumventing the Defendant in paying wages to the Defendant’s workers directly without authorization (“2^nd Basis”).

65.3  Making unwarranted threats to the Defendant (“3^rd Basis”).

66.However, in the Defendant’s Closing Submissions, there was no further elaboration given for the 2^nd and 3^rd bases. During his oral closing, Mr Kwan confirmed that:

66.1  They are no longer pursuing the 3^rd Basis.

66.2  As to the 2^nd Basis, the gist was that by circumventing the Defendant, the Plaintiff is renouncing the agreed arrangement in maintaining the concept that Plaintiff only contracted with the Defendant, whereas it was the Defendant who contracted with the workers, ie a clearly compartmentalized contractual arrangement. By purporting to discharge the payment obligation of the Defendant’s workers’ wages directly, the Plaintiff disregarded an allegedly implicit understanding between the parties. That said, Mr Kwan accepts the 1st Basis is the Defendant’s chief basis.

67.Insofar as the 2^nd basis is concerned, it is sufficient to note that it is unclear what legal basis the circumvention could be regarded as conduct evincing an intention no longer to be bound by the Agreement and/or the Additional Works Agreement. The Defendant has not provided any authority to justify that such circumvention would constitute any renunciation or fundamental breach of the contractual arrangement between the parties. I reject the 2^nd Basis.

68.Going back to the chief basis relied on by the Defendant, there can be no real dispute as to the legal principles of repudiatory breach, as referred to by Mr Kwan, namely that repudiatory breach occurs in the following scenarios:

68.1  The parties have agreed either that the term is so important that any breach will justify termination or that the particular breach is so important that it will justify termination.

68.2  Contractors simply walk away from their obligations clearly indicating an intention no longer to be bound.

68.3  Cumulative effect of the breaches which have taken place is sufficiently serious to justify the innocent party bringing the contract to a premature end.

See Keating on Constructions Contracts, 12^th Ed, §6.112

69.Whether failure to pay would amounts to repudiation will depend on the contractual duty the parties have agreed to regarding the payment: Keating, op cit, at §6-153.

70.As per the findings that I have reached for Issues 4, 5 and 9 above:

70.1  There was no express agreement as to the time for payment.

70.2  There is no evidence that the Agreement or Additional Works Agreement was subject to any term that “time was of the essence”.

70.3  Nonetheless, there was an agreement between the parties that the Plaintiff would only pay a portion of the fee claimed in the Monthly Invoices, ie Interim Payment, subject to the final calculation of the actual work done.

70.4  The concept of “retention money” was, as recognised and admitted by Mr Zeng, in line with the industry practice.

70.5  The Interim Payment would be paid within a reasonable time after the receipt of invoices, which the Plaintiff accepted to be within 14 days.

71.Looking into the Monthly Invoices issued by the Defendant and the Interim Payments made by the Plaintiff:

71.1  By around July 2020, via the June Invoice (dated 10 July 2020), the total amount of work which the Defendant demanded for payment was HK$503,140. After the Plaintiff made the interim payment of HK$130,000 by the cheque dated 17 July 2020 (in addition to the two HK$120,000 payments made by the cheques dated 1 May 2020 and 9 June 2020 respectively), the percentage paid by the Plaintiff was approximately 74%.

71.2  By around August 2020, via the July Invoice (dated 19 August 2020), the total amount of work which the Defendant demanded for payment was HK$655,940[20]. After the Plaintiff made a further interim payment of HK$160,000 by the cheque dated 31 August 2020, the percentage paid by the Plaintiff was approximately 81%.

71.3  Bearing in mind that the sum as stated in the Monthly Invoices was still subjected to the assessment of the work done, the uncertainty as to whether item(s) stated therein were agreed between the parties, and the deduction of material costs, the percentage should probably be even higher.

71.4  As such, I do not accept the Defendant’s Closing Submissions at §49 that “the non-payment / underpayment became serious from July 2020”. Further, as I stated above, the Defendant has, prior to the breakdown of the relationship in October 2020, never accused the Plaintiff of being in breach of the payment terms. What Mr Zeng did in August 2020, as I find above, was just merely pleading Mr Wong for help to weather his liquidity issue. They are not “chasers” per se. At the end of the day, it is my finding above that there was an expressed agreement between the parties that the Plaintiff would only be required to pay a portion of the fee claimed in the Monthly Invoice, subject to the final calculation of the actual work done.

All in all, I accept that the Interim Payments made by the Plaintiff were a reasonable amount in the circumstances of this case and were made within a reasonable time.

72.What appears to be the main issue now, as I understand from Mr Kwan’s oral closing submissions and also appeared to be his main focus then, is essentially the complaint of the absence of any payment after the 27 September 2020 Invoice was sent.

73.Even assuming the reasonable time implied for payment is 14 days, the deadline would only fall on or about 11 October 2020. But before the said deadline, on 6 October 2020, the Defendant unilaterally indicated that it would not continue to work, ie the 6 October 2020 Voice Message.

74.From my reading of this message, it was a clear indication that the Defendant would abandon the Site and repudiate the Agreement and the Additional Works Agreement. I agree with Mr Leung’s submissions that under such circumstances, it would not be unreasonable and indeed prudent for the Plaintiff to not pay any further amount unless and until the Defendant clarified its position, but, as per the Plaintiff’s case and evidence which I accept, Mr Zeng had been avoiding contact with the Plaintiff thereafter and refused to work despite repeated requests. When the Defendant subsequently abandoned the work, thus firmly repudiating the Agreement, there was no reason for the Plaintiff to further pay the sum. After all, even where there is a duty to pay, it is a question in each case of whether failure to pay is a repudiation. The following passage in Keating at §6-153 is relevant:

“Failure to pay instalments. This cannot be a repudiation if there is no contractual duty to pay them. Where there is such a duty it is a question in each case of whether failure to pay is a repudiation. Failure to pay one instalment out of many due under the terms of the contract is not ordinarily sufficient to amount to a repudiation. A failure to pay three instalments, where the employer did not evince an intention never to pay, was held not to be repudiatory conduct. However, it was held to be a repudiation where a company had only paid £10,000 out of £24,000 then due. A failure to pay is less likely to be a repudiation if it occurs towards the end of a contract.”

75.In the circumstances, I find that the Plaintiff was not in repudiatory breach as alleged by the Defendant.

E4(3).  Issue 12- Was the Defendant in repudiatory breach of the Agreement and/ or the Additional Works Agreement by failing to continue with the works and informing the Plaintiff of such intention on or about 6 October 2020?

76.The Plaintiff relies on the Defendant’s 6 October 2020 Voice Message and contends that this message, coupled with the Defendant's subsequent cessation of work, demonstrated a clear intention on the part of the Defendant to renounce the contract.

77.The Defendant denies that the Defendant’s 6 October 2020 Voice Message constituted a repudiatory breach, asserting that it was merely a complaint about the Plaintiff’s failure to settle outstanding payments and not an expression of intention to cease work. The Defendant further contends that the Defendant’s workers refused to continue working due to the Plaintiff’s non-payment and/or late payment. The Defendant claims that it only formally withdrew after the Plaintiff’s repudiation shortly after 23 October 2020, having accepted the Plaintiff’s prior repudiatory breach.

78.In light of my findings above, I have no difficulty in accepting the Plaintiff’s case and rejecting the Defendant’s feeble attempt to characterise the message as merely a “complaint”. The plain language of the message, viewed objectively, constitutes a clear and unequivocal statement of renunciation of future performance of the Agreement and the Additional Works Agreement. I would add that Mr Zeng’s behaviour in avoiding contact with the Plaintiff, which I find to be clear from and evidenced by the WhatsApp Conversations available and after having considered the viva voce evidence of the Plaintiff’s witnesses and the Defendant’s witnesses, was inconsistent with what a reasonable person would do who claimed to be persistently owed a substantial debt.

E5.  Loss and Damages

E5(1).  Issue 13 - If the Defendant was in breach of the Agreement and/or the Additional Works Agreement, did the Plaintiff suffer from loss and damages as a result? If so, what are the loss and damages?

79.According to the Plaintiff’s pleaded case and the summary in the Amended Joint Scott Schedule, the Plaintiff claims loss and damages totaling HK$594,139. Upon the concession made by the Plaintiff during the trial for item (3) and item (4) below, the Plaintiff’s present claim is summarized as follows:

(1)	Salary paid by the Plaintiff to the Defendant’s workers	HK$295,180.00
(2)	Cleaning Costs	HK$64,670.00
(3)	Material Costs	HK$35,360.00
(4)	Costs incurred for completing the remaining of the Works	HK$243,903.85
	Deducting the sum which the Plaintiff agrees to pay –     Works performed by the Defendant in the sum of     HK$651,800 less HK$ 530,000 already paid by the     Plaintiff:     HK$651,800 – HK$530,000 = HK$121,800	(HK$121,800.00)
	TOTAL:	HK$517,313.85

80.I will deal with each of the heads below.

(1)  Salary paid by the Plaintiff to the Defendant’s workers

81.Upon receiving the Defendant’s Opening Submissions, the Plaintiff conceded that he is no longer relying on section 43C and 43F of the Employment Ordinance (Cap. 57, “EO”) to claim the salary paid by the Plaintiff to the Defendant’s workers. Instead, according to the Plaintiff’s Closing Submissions, the Plaintiff is only relying on unjust enrichment to claim for the sum.

82.The Defendant objects to such a claim.

83.First, the Defendant takes a pleading point.

83.1  It is argued that the Plaintiff’s claim based on unjust enrichment has not been properly pleaded in the ASOC and therefore the claim is unavailable for the Plaintiff to run at trial. Despite the fact that it has been pleaded in the Amended Reply and Defence to Counterclaim at §6A that “the Defendant has been unjustly enriched at the expenses of the Plaintiff and it thus liable to repay such sum in restitution”, the Defendant says that that is impermissible and it offends the principle that the main cause of action must be pleaded in the statement of claim, and not in reply: Janful v Sinosoft (HCA 2345/2013, 11 July 2016), §81. The Defendant specifically argues that the “unjust factor” should be expressly pleaded in the statement of claim, citing CRP/PE Munroe Street v Junwei Consulting Trade [2021] HKDC 71 §§43-56.

83.2  The Plaintiff countered this objection by relying on the authority of Ng Po Yu & Anor. v. Lam Kai On, the executor of the estate of Wong Mui, deceased [2021] HKCA 263 at §§39-62, which held that where the necessary facts to support a claim of unjust enrichment have been pleaded, the absence of explicit reference to “unjust enrichment” is not fatal.

83.3  There could be no dispute that a claim of unjust enrichment involves four questions: Shanghai Tongji Science & Technology v Casil (2004) 7 HKCFAR 79 §67 – (i) Was the defendant enriched? (ii) Was the enrichment at the plaintiff’s expense? (iii) Was the enrichment unjust? (iv) Any of the defence applicable?

83.4  For the present purpose, whether the material facts for the first 3 elements have been sufficiently pleaded in the ASOC is relevant. And on a fair reading of the ASOC herein, I agree the necessary facts have been so pleaded, in particular, at §7, which reads:

“Shortly after the Defendant refused to continue the Works, the labours employed by the Defendant gathered at the Site and complained to the Plaintiff that the Defendant had not paid wages to them for their works done at the Site. The Plaintiff had no choice but to settle part of the claimed wages for and on the Defendant’s behalf.”

(a)  It is plain that in stating “labours employed by the Defendant gathers at the Site and complained….that the Defendant had not paid wages to them…The Plaintiff had no choice but to settle part of the claimed wages for and on the Defendant’s behalf”, it is the Plaintiff’s case that the Defendant was enriched in that the Defendant’s obligation to pay wages to its employees was being partially fulfilled by the Plaintiff, and thus at the expense of the Plaintiff. This is further substantiated by the fact that a specific item “Salary paid by the Plaintiff to the Defendant’s labours on the Defendant’s behalf” was pleaded as one of the loss and damages claimed by the Plaintiff at ASOC §9a.

(b)  The pleaded fact that “the Defendant refused to continue to work” followed by the “Defendant gathered at the Site ...” and “the Plaintiff had no choice but to settle ...” would also have supported the element that the enrichment was “unjust”.

83.5  As held in Ng Po Yu, op cit at §48 “As held in Charles Uren v First National Home Finance Limited [2005] EWHC 2529 at [16] and [18], he has to plead facts that are capable of bringing the case within one of the established restitutionary claims or some justifiable extension of them. But if the facts were sufficient it would not matter that there is no pleading of some particular category of restitutionary claim”. (emphasis added)

83.6  It follows that Eternity Contracting & Engineering Co Ltd v. The Jardine Engineering Corporation, Ltd (CACV236/2016, 21/08/2017), §6.15 where the plaintiff therein did not plead any alternative claim at all, is thus distinguished.

83.7  Mr Kwan further argues that the pleading defect causes significant prejudice to the Defendant as they have been deprived of the opportunity to adduce factual evidence concerning the various elements of the unjust enrichment claims. But in light of my view above that the necessary facts have already been pleaded in the ASOC, such an objection falls away. Instead of rebutting the aforesaid pleaded facts, I observe that the Defendant not only made a non-admission, but also pleaded at ADCC §9 (the same paragraph where the non-admission was made) “If (which is not admitted) there was the alleged payment of wage by the Plaintiff to the workers at the work site, the Defendant is entitled to set-off the sum by the Outstanding Amount”. In any event, the fact that the Plaintiff would be relying on unjust enrichment has been expressly alluded to during the pleading stage in the Reply, and I agree with Mr Leung that the Defendant is in fact in a better position than the appellant in Ng Po Yu, op cit, where the unjust enrichment claim was only discussed during the opening submissions. The Defendant had full knowledge that the Plaintiff was relying on facts that are capable of bringing the case under “unjust enrichment” at least at the pleading stage, it is difficult to follow how the Defendant could say it was “deprived” the chance to bring in factual evidence to address the point.

84.Secondly, the Defendant disputes whether the enrichment was unjust, taking issue with whether the Plaintiff should be permitted to claim the workers’ strike was orchestrated by the Defendant and thereby to attribute the blame to the Defendant, arguing that the Plaintiff cannot prove that there is any illegitimate pressure exercised over the Plaintiff:

84.1  The Defendant, riding on the pleading point, takes particular issue that the Defendant has been taken by surprise and that the pleading defect has deprived the Defendant the opportunity to adduce evidence in rebuttal of the allegation that the workers’ strike was attributable to the Defendant:

(a)  Notwithstanding the persuasive submissions of Mr Kwan on the attribution point, I am still not convinced that the Plaintiff should be precluded from advancing the plea of “unjust enrichment”.

(b)  As accepted by Mr Leung, the ASOC could have pleaded the attribution point with greater clarity. However, in my view, on a fair reading of what has been pleaded therein, it is clear that the Defendant’s workers gathered at the Site because the Defendant failed to pay them. It is also clear that this failure led to the Plaintiff having to pay the wages of the Defendant’s workers on the Defendant’s behalf in order to remedy the problem left by the Defendant, and that all of this occurred after the Defendant had indicated that it would abandon the Site. It would be hair-splitting to require the Plaintiff to further specifically plead, as Mr Kwan contends, that the workers’ strikes “were orchestrated by the Defendant” before the plea of unjust enrichment could be advanced.

(c)  So read, and in addition to the oral testimony of Mr Wong KT and Mr Wong KL as summarised in the Plaintiff’s Closing Submissions (at §99), there is ample evidence to substantiate the point, including the witness statements of Mr Wong KT (in particular at §§14-16), Mr Wong KL (in particular at §§4-13, 18-19, 22) and Mr Wong KK (at §§2-8)

(d)  Accordingly, it does not lie in the Defendant’s mouth to complain that the issue of attribution was only first raised during cross-examination, or that I was “ambushed”.

84.2  The Defendant contends that there is no evidence that the Plaintiff was under illegitimate pressure to pay the Defendant’s workers:

(a)  Goff & Jones on Unjust Enrichment, 10^th Ed., §10-69 provides that:

“Where illegitimate pressure has been applied, a party subjected to the pressure may make a deliberate, independent decision to accede to the demand that has been made … Where the claimant has exercised a deliberate choice, the chain of causation between the illegitimate pressure and the conferral of the benefits has been broken.”

(b)  It is also necessary to establish that “the claimant must have had no reasonable alternative to giving in to the threat (or pressure)”: Goff & Jones, op cit, at §§10-70 to 10-72.

(c)  Having considered all the evidence in the round, I am driven to the conclusion that there was illegitimate pressure exerted by the Defendant on the Plaintiff.

(d)  It can hardly be disputed that the Defendant’s workers were gathering at the Site because the Defendant had failed to pay their wages. There is also evidence from the Plaintiff’s witnesses, in particular the evidence of Mr Wong KK during cross-examination, which was left unchallenged and I accept, that in October 2020, as a result of the Defendant’s failure to pay their wages, the workers (including himself) went on strike at the Site and urged for payment of their wages:

“Q: 我想問一問你呢一個達成呢個協議，是你自己，黃建鉄同大判，呢個協議你知道定唔知道究竟黃建鉄個方，喺唔喺因為一啲威逼利誘所引致到佢進入呢個協議㗎?

Mr Wong KK: 你再講清楚，我再聽一次

Q: 黃建鉄喺達成呢個協議裡面，你知不知道佢究竟喺唔喺因為一啲威逼利誘嘅嘅原因?

Mr Wong KK: 就喺我哋無出到糧嘅時間，到地盤嗰度，去抗議，去罷工，一定要出糧俾我哋

Q: 幾時嘅事呀呢個?

Mr Wong KK: 大概十月份嘅時間 …”

(Emphasis added)

I also accept the evidence of Mr Wong KT that he agreed to pay the wages of the Defendant’s workers, who were on strike, because he did not want the whole matter to escalate, as the workers threatened to report the matter to the Labour Department (“工人坐喺個嗰九吐山地盤，話要去勞工署…我哋就驚，其實由頭到尾我哋驚成件是鬧大，我哋唔想搞到咁樣，所以先走去幫佢出糧”). It is also evidenced from the WhatsApp Conversations between Mr Wong KL and Mr Zeng in October 2020 (referred to at §12.11(a) above) that there was concern that the progress of the Project would be affected (“…因為唔想影響地盤進度”).

(e)  The reality of the situation at the material time, which on balance I accept to be the fact, was that (i) The Defendant was operating at a loss and was in financial difficulty; (ii) The Defendant had abandoned the Site and had not been paying their workers; (iii) Mr Zeng had been avoiding discussion with Mr Wong KT since October 2020 (at least, after abandoning the Site); (iv) The Defendant’s workers were protesting at the Site over non-payment of wages by the Defendant, threatening to report the matter to the Labour Department and grinding the progress of the work to a halt. These were, in my view, the decisive and substantial causes that led to the Plaintiff paying the wages on behalf of the Defendant. In the face of these imminent threats, which stemmed from the illegitimate pressure caused by the Defendant, it again lies ill in the Defendant’s mouth to argue that the Plaintiff had any reasonable alternative at the material time, and could have simply paid the Defendant directly instead. I agree with Mr Leung’s submission that “no one in the Plaintiff’s position and in his or her right mind would pay the Defendant” to resolve these imminent threats.

85.Thirdly, the Defendant argues that the common law claim of unjust enrichment has been used by the Plaintiff as a way to outflank or circumvent the notification requirement under s.43D of the EO. Mr Kwan referred me to the case R (Child Poverty Action Group) v Secretary of State [2010] UKSC 54 at §27 “When a special or qualified statutory remedy is provided, it may well be inferred that Parliament intended to exclude any common law remedy which would or might have arisen on the same facts.”.

85.1  However, §34 of the same case also provides that:

“… The court should not be too ready to find that a common law remedy has been displaced by a statutory one, not least because it is always open to Parliament to make the position clear by stating explicitly whether the statute is intended to be exhaustive ... The question is whether, looked at as a whole, a common law remedy would be incompatible with the statutory scheme and therefore could not have been intended by co-exist with it.” (emphasis added)

85.2  To that, it is accepted by Mr Kwan that there is no provision in the EO which ousts the common law remedy.

85.3  Mr Kwan invites me to undertake the exercise of construction of the EO and come to a conclusion that the Legco could have never intended to allow a common law unjust enrichment claim to circumvent the various notice requirements required under the EO. Suffice it to say, unlike R (Child Poverty Action Group) where the court had the benefit of the evidence in relation to the legislative history of the relevant provision, nothing as such in respect of the EO, which I consider to be essential before I could properly engage in the exercise of statutory interpretation and decide on the legislative intent, have been provided to me.

85.4  With the evidence presently available before me, I do not consider that the statutory mechanism under s.43B–43F of the EO (which appears to be directed to the protection of workers) is intended to be exhaustive or to displace the common law remedy.

86.Accordingly, I allow the sum of HK295,180 which is evidenced by receipt of the cheques paid to the Defendant’s workers.

(2)  Cleaning Costs

87.The quantum of HK$64,740 claimed under this head is supported by evidence (including copies of cheques and receipts), and is not disputed by the Defendant.

88.The Defendant only disputes liability. In the Defendant’s Closing Submissions, the grounds advanced are that there was no repudiatory breach by the Defendant or, alternatively, there was no evidence to support that there was such a need of “cleaning” whilst the Site was still in operation after October 2020.

89.Following my finding for Issue 1 above, the Defendant was, under the Agreement as per the Plaintiff’s version of the 7 April 2020 Quotation, under an obligation to carry out cleaning upon completion of the works (包手尾清洁), and the  Defendant’s version of the 7 April 2020 (which purported to restrict the scope of cleaning (一般 = (手尾清洁))  has been rejected.

90.I also note that the evidence of Mr Wong KT (at Wong KT Supp WS §25) and Mr Wong KK (at Wong KK WS §10) that the external walls of the 3 Houses were left dirty after the Defendant abandoned the Site was not challenged in cross-examination. I accept their evidence.

91.Accordingly, I allow this head of claim in full.

(3)  Material Costs

92.As stated above, the Defendant no longer disputes such claim. I allow the sum claimed.

(4)  Costs incurred for completing the remaining of the works

93.Up until the closing stage of this claim, the Plaintiff claims a sum of HK$308,125 under this head, and a summary of the said costs has been provided (with reference to photos and descriptions of the work done).

94.The relevant legal principles has been provided in Keating, op cit, at §§9-068,9-069:

“9-068 Where the contractor fails to complete, the measure of damages in the first instance is the difference between the contract price and the amount it would actually cost the employer to complete the contract work substantially as it was originally intended, and in a reasonable manner, and at the earliest reasonable opportunity. Thus in Mertens v Home Freeholds Co, the contractor agreed to build a house in 1916 for £1,900. It was an unprofitable contract and it therefore deliberately delayed the work so that as a result the work was stopped by government decree. The earliest moment at which the employer could build was 1919 when it would have cost him £4,153 to complete. It was held that the employer could recover the difference between £4,153 and £1,900, plus £825 paid to the contractor, less £495 being the value of the work done by the contractor before it ceased work, making a total of £2,583. In one case the claimant recovered the cost of rebuilding the premises where the defendant had supplied mortar so inferior that the local authority condemned the building.

9-069 If exceptionally the cost of completion is less than the contract price, the employer is entitled to nominal damages. Although, in one such case, where a contractor who had repudiated had been paid on account more than the value of the work it had carried out, the employer was held to be entitled to repayment of the difference in addition to its nominal damages.”

95.Relying on these principles, it is the Defendant’s case that the Plaintiff should only be awarded with nominal damages under this head. The Defendant says that the Plaintiff could not prove his loss and damages in the absence of evidence to show whether or not the cost of completion was actually more or less than if it was the Defendant who completed the work.

96.In the Plaintiff’s Closing Submissions, the Plaintiff conceded that the HK$308,125 should be deducted by the sum payable to the Defendant had the Defendant completed the work, and such sum could be arrived at by deducting (a) the total area as measured by the Defendant (ie the Defendant’s Measured Area - 824.5775 m²) by (b) the area of works performed by the Defendant (750 m² for rendering/plastering and 700 m² for laying of tiles) and (c) multiplied by the Unit Rates. Thus:

(824.5775 – 750) x HK$ 360/m² + (824.5775 – 700) x HK$300/m²

= HK$26,847.9 + HK$37,373.25

=HK$64,221.15

And the sum claimed under this head should be revised to become HK$308,125 – HK$64,221.15 = HK$243,903.85.

97.The Defendant then submitted that the Plaintiff should not be allowed to patch up his case as such without having put his case to Mr Zeng at cross-examination, thereby depriving the Defendant the opportunity to respond.

98.With respect, I disagree with the Defendant’s submissions.

98.1  Mr Wong KT was being specifically referred to §28 of Wong KT Supp WS during cross-examination which states “正如我在第一份證人陳述書第17段所說，原告人接手被告人餘下未做完的本案工程部份，人工和物料總數為 $308,125”. While Mr Wong KT was being questioned as to whether he had calculated the estimated costs he would need to pay the Defendant if it was the Defendant who completed the remaining works, which Mr Wong KT accepted that he did not, I note that he was not challenged at all on the sum of HK$308,125. He was neither challenged on whether the HK$308,125 was the sum incurred for such remaining works, nor whether the remaining work was not done at the earliest reasonable opportunity.

98.2  There is no dispute that the 824.5775 m² was an area which the work should have covered under the Agreement as measured by the Defendant himself;

98.3  It has been my finding above that the scope under the Agreement required the Defendant to complete the work for all 3 Houses, and that the areas that the Defendant had covered was 750 m² for the rendering/plastering work and 700 m² for the laying of tiles, and the work should be calculated at the Agreed Rates under the Agreement.

98.4  I am aware that it has been specifically put to Mr Zeng in cross-examination that the area he completed only adds up to 750 m² for rendering/plastering work and 700 m² for laying of tiles, which he disagreed with. It has also been put to Mr Zeng in cross-examination that there were works incompletely done, which he claimed was mostly done.

98.5  Accordingly, all the constituent elements were set, and what remains to be done is just a matter of logical calculation. It is my view, under such circumstances, it could hardly be said, as argued by Mr Kwan, that the Defendant had been deprived of the opportunity to respond or that the calculation put forward by the Plaintiff in the closing submissions constituted giving evidence from the bar table.

99.As such, I would allow the revised sum of HK$243,903.85 claimed under this head.

100.In summary, I find that the Plaintiff has suffered loss and damages in the total sum of HK$517,313.85 (as set out in the table in §79 above).

E5(2). Issue 14- If the Plaintiff was in breach of the Agreement and/or the Additional Works Agreement, did the Defendant suffer loss and damages as a result? If so, what are the loss and damages?

101.In light of my findings above, the Plaintiff was not in breach of the Agreement and/or the Additional Works Agreement, and this issue does not arise for consideration.

E5(3). Issue 15- Whether the Plaintiff is liable to pay the Defendant the outstanding amount as claimed. If not, what is the proper amount entitled by the Defendant, if any?

102.Again, in light of my findings above, this issue does not arise for consideration.

F.  CONCLUSION

103.For the above reasons:

103.1  I allow the Plaintiff’s claim only to the extent in the sum of HK$517,313.85, plus interest at 1% p.a. above HSBC prime rate of the said sum of HK$517,313.85 accruing from 14 January 2021 (ie the date of Writ) until the date of this Judgment, and thereafter at judgment rate until the date payment in full.

103.2  I dismiss the Defendant’s counterclaim.

104.Costs should follow the event. I make a costs order nisi that the Defendant shall pay the Plaintiff all costs of this action, inclusive of all costs and occasioned by the Counterclaim and all costs reserved, with certificate for counsel, to be taxed if not agreed.

105.It remains for me to thank counsel on both sides for their helpful assistance.

Mr Desmond Leung, instructed by Kwok, Ng & Chan, for the plaintiff

Mr Kwan Ping Kan and Mr Kelvin Wong, instructed by Chan, Wong & Lam, for the defendant