Promotors Ltd v. Kays Impex Corporation (HK) Ltd

HCA002554/1974

IN THE SUPREME COURT OF HONG KONG

ORIGINAL JURISDICTION

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Coram: Mr. Registrar Stapp in Chambers.

Date of Judgment: 23rd April 1976

Mr. R. Wei, Counsel instructed by Messrs. W.K. Lore & Co., Solicitors for the Plaintiff.

Mr. A.R. Taylor of Messrs. Johnson, Stokes & Master, Solicitors for the Defendant.

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ASSESSMENT OF DAMAGES

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1. By a contract dated 9th February, 1974, the Plaintiff agreed to sell to the Defendant 1,500 "Parsug 101" brand electronic calculators at a price of $54 U.S. (equivalent HK$270) each.

2. Subsequently, the Defendant accepted delivery and paid for 832 calculators, but failed to accept delivery of the remaining 668.

3. It was agreed that the date of the breach of contract was 15th October, 1974, and that the rate of exchange at that time was five H.K. dollars to one U.S. dollar.

4. Evidence was given by Mr. Leung Kwan, a salesman for the Plaintiff. I accept his evidence to the effect that he had made efforts to sell the 488 completed calculators in October 1974. I further accept that his Company's offer of sale for US$25 per calculator was declined, and that a counter-offer of US$20 was not accepted by his company. There had been a dramatic fall in the market value since the date of contract, and the prevailing market value was no more than US$25 per calculator, perhaps less. Mr. Wei conceded on behalf of the Plaintiff that the market value was US$25, and I accepted this as a fair basis for my assessment. There was no evidence called for the Defendant.

5. I find that the measure of damages in respect of the 488 completed, or virtually completed units, should therefore be assessed as per the formula on the sheet tendered by the Plaintiff as exhibit B, viz:

6. Difference between contract price and market value

7. U.S.D. 54 - U.S.D. 25 = U.S.D. 29.00 per set

8. Damages 488 x U.S.D. 29 = U.S.D. 14,152

9. I now pass on to the question of damages concerning 180 kits of calculator parts which were not assembled. Mr. Joseph Ng gave evidence for the Plaintiff as to its suggested formula for calculating damages, which is also set out in exhibit B, viz:

10. Damages 180 x U.S.D. 39.07 = U.S.D. 7032.60

11. Mr. Ng testified that it would have cost a further U.S.$ 14.93 per calculator in materials and labour to have completed the assembly of those 180 kits. He said that the integral parts of the kits otherwise were of no commercial value as they could not be used in the never models.

12. Mr. Taylor contended for the Defendant that it was the Plaintiff's duty to mitigate his loss, and that those 180 kits should have been completed for sale, rather than becoming a complete loss.

13. Mr. Wei, on the other hand, argued that there was no necessity for the Plaintiff to "send good money after bad", in an uncertain market.

14. However, having regard to all these circumstances, and in particular to the relatively small number of potential calculators involved, and to the bulk-selling nature of the Plaintiff's business, I consider that the Plaintiff should have taken the further and reasonable step in mitigation of damages.

15. I would therefore assess damages in relation to those 180 kits as follows:

16. Total damages are as follows:

17. Conversion at agreed rate of exchange

18. 5 x 16,684.60 ................... 83,423

19. I therefore assess total damages due to the Plaintiff in the sum of HK$83,423.

20. Inward costs to the Plaintiff, with a certificate for counsel.

21. Dated this the 23rd day of April 1976.

Representation:

Mr. R. Wei, Counsel instructed by Messrs. W.K. Lore & Co., Solicitors for the Plaintiff.

Mr. A.R. Taylor of Messrs. Johnson, Stokes & Master, Solicitors for the Defendant.