Hang Tat Piecegoods Co Ltd v. Pacific Dyeing Works Ltd

HCA001332/1978

Coram: Zimmern, J.

Date of Judgment: 25 January 1979

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JUDGMENT

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1. The parties as as their names imply are dealers in and converters of textiles respectively. In December 1977 the Plaintiff had to employ a converter to convert 27,650 yards of grey cotton sheeting into finished dyed goods which were required for delivery to an ascertained sub-purchaser latest 31/1/78. Its manager a Mr. Wong contacted and negotiated with a Mr. Li, manager of the Defendant company which culminated in Mr. Li issuing to the Defendant a signed order form said to be Job No. 771953 with the following particulars:-

In the remarks column are set out the 8 colours required with yardage per colour and the cost per colour written in ink. Clipped thereon the swatches of the colours. It is stamped "CASH AGAINST DELIVERY ORDER" and there is a printed clause which reads:

"The works reserves all rights of lien upon the goods for processing charges and other expenses due to or to become due from the Consignors including a lien for amounts due from the Consignors on general account."

2. The Plaintiff on dates set out later delivered to the Defendant 27,274.5 yards of the specified grey sheeting. It is common ground that by 31/1/78 the Defendant had completed converting only 4 colours, and on 2/2/78 the Plaintiff took delivery of 2 colours totalling 4,745 yards. The Plaintiff by its Statement of Claim alleges that the Defendant by its failure to complete the job by 31/1/78 had repudiated the contract which repudiation it had accepted both orally and in writing. It therefore claims return of the balance of the goods or their value and damages for breach of contract. The defence and counterclaim of the Defendant will emerge as I deal with the Plaintiff's claim in detail.

3. The first 3 paragraphs of the Statement of Claim read as follows:

4. Paragraph 3 is agreed to the extent that the Plaintiff did deliver to the Defendant the yardages of grey sheeting on the dates as set out.

5. As to paragraph 2 all I need say at this stage is that under the signed order form the Defendant was obliged to complete the job and to have the goods available for delivery against payment latest 31/1/78.

6. As to paragraph 3, the Plaintiff's allegation about the supply of greys by instalments is not evident on the face of the order form which is also silent as to when they should be supplied and by whom. The parties are agreed that the greys, as intended, were in fact supplied by the Plaintiff and the contract was one for work and labour but there is no averment in the Statement of Claim when the greys ought to have been supplied.

7. The Defendant by its defence takes this matter up and I set out paragraphs 1(a) and (b) thereof:

8. The Plaintiff by its Reply joined issue with the defence and alleged in contradition certain facts to which Mr. Wong testified and which I unfold later.

9. This conflict is the pith of the matter and the question is was the Plaintiff late or within time when it supplied the greys to the Defendant. Having heard the evidence I am in no doubt that the Plaintiff was late in supplying the greys and it follows that the Defendant was not obliged to complete the job it had engaged itself to do within the month of January 1978.

10. Mr. Wong of the Plaintiff told the court that the job order form was for the purpose of booking space and time in the Defendant's factory and in his negotiations with Mr. Li there was no discussion as to when the greys should be delivered. He had wanted to deliver them in mid December but the Defendant told him not to as there was no space to contain the goods in its factory. In spite of several telephone calls the Defendant still prevaricated and told the Plaintiff not to deliver until called for. The instalment deliveries were at the request of the Defendant. In mid January the Defendant telephoned and he asked about completion and was told that that it would be alright. Mr. Wong was not a convincing witness.

11. Mr. Li completely denied Mr. Wong's version. He had told Wong that the greys will have to be delivered within 1 or 2 days of contract for completion 1 to 1½ months thereafter. It was the Defendant's general practice. He neither told Mr. Wong to postpone delivery until called for nor to deliver by instalments.

12. Miss Ng, a clerk in the employ of the Defendant company told the court that one of her duties was to see that the factory received the greys on time. Upon receipt of the Job Order form she tried to get in touch with Mr. Wong but without success till sometime after 20/12/77. No grey had yet been delivered. She told Mr. Wong unless deliveries were made the contract would be delayed. Mr. Wong replied that the greys were not ready and told her not to press him. After the Plaintiff's first delivery on 6/1/78 she told Mr. Wong that the quantity was insufficient.

13. On 26/1/78 the Plaintiff wrote to the Defendant requesting for delivery on or before the end of the month. The Defendant did not reply in writing but Miss Ng said upon its receipt she rang Wong and told him that it would be impossible to finish in time due to the delay in the delivery of the greys. On 1/2/78 she received a call from the factory to say 4 colours were ready. She rang Mr. Wong and told him of this and Mr. Wong instructed her to deliver 2 specified colours and to retain the others. By a letter dated 2/2/78 the Plaintiff instructed the Defendant to stop dyeing work so as to avoid further losses and to store finished goods for the time being. The Defendant did not write till 4/3/78. The Defendant also called its Factory Manager who inter alia said that it was impossible to finish the goods by the end of January because the greys were not delivered on time.

14. I accept the evidence of Miss Ng and Mr. Li and find as a fact that at all times Mr. Wong knew the plaintiff had to deliver the greys within a few days of the Defendant signing the Job Order for the goods to be finished on or before 31/1/78 and by a long chalk had failed to do so. The Plaintiff's claim therefor fails and there will be judgment with costs for the Defendant.

15. As for the Counterclaim the particulars for work and labour are set out in paragraph 5 of the Defence. Four colours had been finished including 2 delivered and unpaid:-

The white was claimed at $0.80 per yard as against the contract price of $0.70 and I have made the necessary amendment.

16. The Defendant counterclaims on a quantum merit of $0.70 per yard on the balance of 12,919 yards of partially finished goods. The Plaintiff did give specific instructions on 2/2/78 not to dye these goods. The Defendant is entitled to work and labour spent on them and the Defendant's invoice for these have not been challenged. These come to $9,043.30. There are claims for delivery charges which have not been proved and will be disallowed. Then there is a claim for storage charges for the goods on which the Defendant claims a lien. This claim is qua bailee for reward to work on the goods and at law apart from agreement applies only on the actual sum due for materials and labour expended and not for warehousing (see Vo1. 2 Halsbury's Law of England para. 1571). In this case there is an express agreement for a lien for amounts due from the Plaintiff on general account, accordingly it is entitled to the storage charges for the goods from 1/2/78 and I so declare.

17. There will be judgment with costs for the Defendant in the sum of $21,799.65 for work and labour with interest at 8% per annum from 1/2/78 to to-day on its counterclaim.

Representation:

Daniel FUNG (Ho & Wong) for Plaintiff.

Peter CHEUNG (Fairbairn, Kwok & Wang) for Defendant.