The Hongkong Electric Company Limited v. Cheng Leung Kee Trading As Leung Kee Construction Company

Case No.HCA 676/1978

Court

High Court CFI

Date—

Judge—

Case Document

100%Judiciary

HCA000676/1978

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

ACTION NO. 676 OF 1978

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BETWEEN
	THE HONGKONG ELECTRIC COMPANY LIMITED	Plaintiff
	and
	CHENG LEUNG KEE trading as LEUNG KEE CONSTRUCTION COMPANY	Defendant

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Coram: Li, J. (In Court as Chambers)

Date of Judgment: 16th May, 1978 at 12.35 p.m.

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JUDGMENT

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1. This is an appeal from the Registrar's decision giving judgment on an Order 14 summons. The plaintiff's claim is for the sum of $24,684.10 plus interest for work done and services rendered and expenses incurred for the defendant at the defendant's request. Thus the claim is based on work done on the defendant's request.

2. The facts appear to be as follows: The defendant is a contractor having an agreement with one Fung Lam Investment Holding Company Limited to do excavation work for the latter. One firm by the name of Pui Kee is the sub-contractor to the defendant. The work purported to be done by the defendant was in fact carried out by the firm of Pui Kee. Having entered into such agreements, excavation work commenced. In October 1975, the plaintiff, the Hong Kong Electric Company Limited, discovered that there were certain defects in the electricity supply to the area and traced the trouble to the excavation site upon which work was being carried out by Pui Kee. They discovered that a medium voltage cable and a high voltage cable were damaged. Repair work was required. There were some discussions at one stage as to who should be responsible for payment of the bill for the repairs. Eventually the defendant took the responsibility of paying for the repair work. Arising from such repair work, it was obvious that the cables, so long as they remained on the site, would be a hazard to any excavation work. As a result the two cables were diverted from the site. The sum now claimed is the costs and expenses for work done for the diversion of the cables. The plaintiff's argument is that the diversion was at the request of the defendant. The defendant denied that there had been any request for such diversion.

3. In view of this there appears to be two issues. The first is whether the defendant can be held liable as contractor on the site. Secondly whether the diversion was effected at the request of the defendant or its agent. I do not feel that there can be much argument as to the defendant being contractor on the site. The defendant paid for the repair bill. Although the defendant appointed a sub-contractor, the defendant assumed responsibility for whatever damage that was caused by the sub-contractor. The main argument is centred on the second issue, namely whether the diversion was done at the request of the defendant or his sub-contractor. The defendant denies liability. Unfortunately the defendant has not seen fit to give details as to why there was no request for the diversion. Obviously the diversion was necessary for the excavation work to be continued. There must be a triable issue on this point because even in paragraph 8 of Mr. Taylor's affidavit filed on the 12th of April 1978, it has not indicated any request made by the defendant. It reads:

"I am further informed by Mr. Simon Chui Hung Chi, and verily believe, that during the same conversation Mr. Sin Po informed him that the plaintiff could not leave the cables on their old routes as this would interfere with the construction work because they were re-excavating the site and the cables were a hazard to the bulldozers. He asked Mr. Simon Chui Hing Chi to arrange for the diversion of the cables as quickly as possible."

This may be read that the diversion was requested by Mr. Sin Po. At the same time it may be read as a demand by Mr. Sin Po that the cables should be diverted. Reading it in this light the question as to who had the responsibility of removing the cables is in issue. This depends on whether the plaintiff, had a right to run the cables through the site. As such they could take a complacent attitude towards the defendant and say: "We shall not move the cables unless you request a diversion. If you dare excavate despite any danger to you, it is your own look-out." On the other hand if the plaintiff had no such right to run the cables through that site, it might well be that Sin Po was in a position to say: "You have no right to allow the cables to remain on the site any longer because we are doing excavation work. You shall divert the cables yourself."

4. No mention has been made as to costs for such diversion or as to whose responsibility it should be to bear the costs. This is also evident in a letter which is exhibited in SSP-1 attached to the affidavit of Mr. Sin Shiu-po. It is a letter written by the senior operations and maintenance engineer to the defendant. It reads that:

	"On 21st October 1975 a high voltage cable fault occurred and was traced to the above location and on 26th October 1975 a medium voltage cable fault occurred and was also traced to the above site. After long investigation by our engineers, it was discovered that you were carrying out site work at the location at the time of the incidents.
	Before you carried out site work you should have written to us for information about any cables laid on site whereupon we would have furnished you with detail concerning the existence and position of our cables. With this information your workman could be instructed to exercise care so as to avoid damage and danger. Also, the need to divert any cables would have been noted and appropriate action taken.
	Diversion of cables is to the cost of the developer, as is the cost of repair of any damage caused by him, and we will shortly forward to you our debit note to cover the above costs. The amount is approximately $25,000.00, the exact amount will be determined when full costing has been carried out."

As indicated in this letter it seems that the plaintiff was putting the responsibility on the developer. No mention was made as to any requests made by the defendant. This in my opinion, must be a triable issue.

5. An attempt has been made to recover the costs or expenses for the diversion on the quantum muruit basis. That is not the claim as set out in the statement of claim. The case of Craven-Ellis v. Canons Limited (1936) 2 K.B.403 is cited in support of the proposition that the plaintiff might well recover on the quantum muruit basis. That case must be distinguishable. The principal of quantum muruit is founded on an implied agreement. In the Craven-Ellis case services were requested by a limited company, a contract was drawn up for the services but because of a technical point in law the plaintiff was unable to be so appointed and the contract of service was rendered null and void. However, services were rendered at the request of the limited company. As such it was held that the plaintiff could recover his remuneration on quantum muruit basis.

6. I also consider whether expenses incurred for benefit conferred in an emergency can be recovered. It is stated in Chitty on Contracts 24th Edition, paragraph 1879 that:

"Except in cases of agency of necessity, or of salvage, English law has usually refused to give a remedy to a person who intervenes in the affairs of another, even where the purpose of his intervention is to benefit that other in an emergency or to rescue the other's property from danger. But there is some support for the emergence of a principle that where the plaintiff has acted reasonably and bona fide in the interests of the defendant, in order to protect the defendant's property, health, or other important interests, in an emergency where it was impracticable to obtain the defendant's instructions or authority, the plaintiff may recover the expenses he incurred and reasonable remuneration for his services."

In the present case the plaintiff had opportunity of making sure that the diversion be done at the request of the defendant. The plaintiff could have left the cables there after repair and forced the issue with the defendant. However, I have only the assertion that it was done by a request of the defendant. The defendant has denied such a request. The defendant has not, however, descended upon the form to show why the request was not made by the defendant although the diversion work could not have been done without the knowledge of the defendant. The defendant permitted such diversion to be made without objection. Because of this the plaintiff is able to maintain that work was done at the request of the defendant I will order that leave to defend should be granted upon condition that the defendant pay the sum claimed into court. To this extent the appeal is allowed and the Registrar's decision is varied.

7. The defendant is partly responsible for this ruling by the Registrar and I would make it costs to be costs in the cause. I order that subject to the Registrar's finding as to possibility of money paid into court to be deposited money paid into court in this case be paid into deposit account. There will be the usual directions. Payment to be made in seven days.

Representation: