Feng Loy Chuen Formerly t/a Shui Cheung Pearl Co v. Lim Yiong-lin

HCA000097/1977

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

Action No. 97 of 1977

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Coram: Zimmern J. in Chambers.

Date of Judgment: 18th August 1977

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DECISION

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1. In this case the plaintiff applies to the Court for an order under Order 29 Rule 2 to preserve certain gems set out in a schedule annexed to the summons.

2. The statement of claim alleges an oral contract made in 1969 between the plaintiff and the defendant whereby the plaintiff would supply gems to the defendant for sale abroad in an ascertained manner and the profits would be divided between them on a fixed proportion. That between 12/11/69 and 4/7/73 the plaintiff delivered to the defendant $6,849,354.68 worth of gems and the defendant has only accounted for $3,714,843.18 which plus $8,491.95 worth of gems returned leaves a balance of $3,126,019.55 worth of gems unaccounted for. A full list of the gems totalling in value $3,126,019.55 is set out in the statement of claim. The plaintiff then alleges failure or refusal to return the gems upon demand and claims under heads (a) (b) & (c) of his prayer accounts, inquiries, payment over of any sum found due then under head (d) alternatively return of the gems set out in the statement of claim and under (e) damages for detinue.

3. The plaintiff's affirmation in support of his application is at best woolly and para. 4 reads "It was an implied term of the agreement that if the diamonds and precious stones supplied to the defendant were not sold within a reasonable time the defendant would return the same to me". This allegation of an implied term has not been pleaded and if relied upon must be pleaded. Para. 10 alleges the sale by the defendant in 1974 of a bracelet and a bangle for a total of $95,000 when the agreed selling price was $110,000. There are also vague suggestions that the defendant is exhibiting other articles for sale.

4. The defendant by his defence alleges that there was never such contract as claimed. The plaintiff, alleges the defendant, delivered certain gems to him as security for loans totalling $3,893,747.10 with interest thereon sometime between 1969 and 1973. With a view to reducing the various loans the defendant did at the request of the plaintiff sell some of the stones and accounts have been rendered to the plaintiff.

5. For the purpose of my decision in this application I do not need to refer to the defendant's affidavit. The High Court is not a depository of chattels at the whim and fancy of litigants. A Court will usually make an order under Order 29 Rule 2 if in the interest of justice that as between the plaintiff and the defendant there in something which ought to be done for the security of the property for example the preservation of chattels by deposit in court premises for safe keeping (Chaplin v. Barrett)⁽¹⁾ The fact that the chattels in this case are gems does not make any difference. The plaintiff's first claim is for accounts and payment over if any sum is found due. This alone may dispose of the whole case. It is only in the alternative that the plaintiff claims return of the gems and damages for detinue. This claim is for gems which were alleged to have been delivered to the defendant at various times from 1969 to 1973 for the purpose of sale. The statement of claim does not even allege when the gems ought to have been sold or returned; nor does it even condescend to show when the return of the gems had been demanded. For a period of over 4 years nothing was done. I repeat the gems were delivered by the plaintiff for the purpose of sale and each item has been valued by the plaintiff and set out in the statement of claim. The plaintiff has not succeeded in pursuading me on the facts of this case that if he were to succeed at the hearing a Court will order restitution. He could be fully compensated by payment (see judgment of Diplock L.J. in General and Finance Facilities Ltd. v. Cooks Cars (Romford) Ltd.⁽²⁾ and Whiteley, Limited v. Hilt⁽³⁾). Furthermore there is no allegation that the defendant would not be good for his money. I find in the interests of justice that as between the plaintiff and the defendant the gems do not require preservation and the application fails. There will be costs for the defendant and certificate for Counsel.

6. In deference to Mr. Tang for the plaintiff who relied so heavily on Ridpath & Ridpath v. Zachner⁽⁴⁾ and Velati & Co. v. Braham & Co.⁽⁵⁾ I mention that I am completely unable to read into them principles of law which he says are implicit in them. The only resemblance between this case and the other two is that they all concern gems. The courts in the other cases came to the conclusion on the facts that the gems required preservation. I have given my reasons why in this case the gems do not require preservation.

Representation:

Robert Tang (H. H. Lau & Co. ) for Plaintiff

Sakhrani (Kenneth K. C. Wong & Co.) for Defendant.

(1) (1912) 28 T.L.R. 256

(2) [1963] 1WLR 644 at p.648

(3) [1918] 2 KB 808

(4) [1893] 9 TLR 538

(5) [1877] 46 LJ Rept 415