Gateway Global Logistics (HK) Ltd v. Korani Krishore Kumar and Another
Read the full judgment text of DCCJ 5013/2004 on BabelCite. This District Court judgment was delivered on 29 November 2005.
1. The Plaintiff is a cargo forwarding agent that handles the delivery of goods for its customers by various means, including air shipment. The 1st and 2nd named Defendant (collectively called the “Defendant”) carried on a partnership business of import and export as well as wholesale of watches.
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DCCJ5013/2004 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CIVIL ACTION NO. 5013 OF 2004
BETWEEN
Coram: H H Judge Marlene Ng in Court Date of Hearing: 29 November 2005 Date of Delivery of Judgment: 29 November 2005
J U D G M E N T
1.The Plaintiff is a cargo forwarding agent that handles the delivery of goods for its customers by various means, including air shipment. The 1st and 2nd named Defendant (collectively called the “Defendant”) carried on a partnership business of import and export as well as wholesale of watches. 2.On or about 4 February 2003, the Plaintiff and the Defendant entered into a contract contained and/or evidenced by a cargo booking and collection form (hereinafter called the “Form”) and a shippers’ letter of instructions (hereinafter called the “Instructions”) completed and signed by the Defendant whereby the Plaintiff agreed to handle on the Defendant’s behalf the air shipment of nine cartons of goods declared by the Defendant to be timepieces (hereinafter called the “Goods”) to a consignee in Morocco. 3.The relevant provisions of the Instructions are as follows:
4.The Trading Terms and Conditions referred to above provides, inter alia, as follows:
5.The Plaintiff further claims that in order to induce the Plaintiff to act in accordance with the Defendant’s instructions to handle the air shipment of the Goods, the Defendant represented to the Plaintiff that the Goods were timepieces that were readily exportable overseas in compliance with all legal requirements. 6.The Plaintiff duly handled the air shipment of the Goods in accordance with the Defendant’s instructions and delivered the Goods to Super Terminal One, Hong Kong International Airport for loading onto a Gulf Air flight GF-151 for departure on 6 February 2003. 7.But the Goods were in fact not readily exportable in compliance with all legal requirements and were seized by the Customs and Excise Department (hereinafter called the “Department”) prior to departure for containing the forged trade mark “CITIZEN”. 8.In the circumstances, the Plaintiff claims that the Defendant was in breach of contract in failing to disclose fully, completely and accurately all description and particulars of the Goods and/or the Defendant fraudulently or recklessly misrepresented that the Goods (which were in the Defendant’s actual custody and control prior to delivery to the Plaintiff for export) were readily exportable in compliance with all legal requirements. Further or alternatively, the Plaintiff claims that the Defendant made the misrepresentation negligently in that the Defendant failed to:
9.On 10 September 2003, the Defendant was convicted of the offence of attempting to export goods to which a forged trade mark was applied under the Trade Descriptions Ordinance, Cap. 362 (hereinafter called the “Offence”). 10.On 28 July 2003, a summons was laid by the Department against the Plaintiff at the Tsuen Wan Magistracy under sections 12(1) and (2) as read with section 18(1) of the Trade Marks Ordinance, Cap. 362 and section 159G of the Crimes Ordinance, Cap. 200 for attempting to export the Goods to which a forged trade mark, namely, “CITIZEN” was applied (hereinafter called the “Summons”). The Plaintiff was convicted after trial and was fined $8,000 (hereinafter called the “Fine”) which was paid by the Plaintiff on or before 18 December 2003. 11.The Plaintiff incurred a total sum of $90,591.50 for its own legal costs as evidenced by five bills of costs issued by its solicitors being bills nos. B10788-03, B10851-03, B10987-03, B11069-03 and B11188-04 (hereinafter called the “Bills”) in the respective sums of $2,270, $7,200, $20,789.50, $21,845 and $38,487 (hereinafter called the “Legal Cost”). 12.By a letter dated 8 September 2003 from the Plaintiff’s solicitors, the Defendant was put on notice of the Plaintiff’s intention to seek indemnity against all costs and damages arising from or in connection with the Defendant’s act, omission, negligence or default pursuant to the Instructions. 13.By a further letter dated 27 February 2004, the Plaintiff’s solicitors demanded the Defendant to indemnify the Plaintiff for the Legal Cost and Fine, but the Defendant failed to so indemnify the Plaintiff. 14.The Plaintiff therefore claims against the Defendant for the Legal Cost and Fine and for damages to be assessed. 15.Since the Defendant failed to file any notice of intention to defend, the Plaintiff entered interlocutory judgment against the 1st and 2nd named Defendant for damages to be assessed on 2 February 2005. 16.On 25 April 2005, Deputy District Judge W K Kwok gave directions for the hearing of the assessment of damages and adjourned the hearing to a date to be fixed. The Plaintiff filed its list of documents and witness statements on 5 and 19 July 2005 respectively. I am informed by Mr Wong, counsel for the Plaintiff, that the Plaintiff’s list of documents has been served by post on 5 July 2005. I am further informed that the Defendant did not respond to the invitation by the Plaintiff’s solicitors to exchange witness statements and the Plaintiff’s witness statement was served as part of the hearing bundle on 25 November 2005. The Plaintiff’s solicitors through counsel undertake to the court to file an affidavit of service to such effect on or before 4.30 pm tomorrow. 17.The Plaintiff’s solicitors applied inter partes to restore the hearing of the assessment of damages. The restored hearing was fixed for today in the absence of the Defendant. The Order of Deputy District Judge W K Kwok dated 25 April 2005 and the notice of the restored hearing of the assessment of damages have been served by ordinary post on 23 May and 1 September 2005 respectively. The Plaintiff’s solicitors again through counsel undertake to the court to file an affidavit of service to such effect on or before 4.30 pm tomorrow. 18.The service of the above documents were made to the Defendant’s last known address at Flat B, 13/F, Minden House, Nos. 13-15 Minden Avenue, Tsim Sha Tsui, Kowloon. The land search records of such property showed that it is jointly owned by the 1st named Defendant and another person. According to the company search records of a company known as Krishna’s Time Centre Limited, the 1st and 2nd named Defendant were subscribers and directors. They gave their address at the said property at Minden Avenue and the registered office of such company is also at the said property even though, according to the process server of the Plaintiff’s solicitors, as at October 2004 the said property was occupied by another company. 19.The Plaintiff’s solicitors also served the above documents on another address, namely, G/F and Garden, Block N of Victory Garden, 89A Hung Leng North, New Territories, which according to a company search submitted to the court at the hearing today was jointly owned by the 1st named Defendant and another person. 20.The 1st and 2nd named Defendants are brothers and they carried on the Defendant business as a partnership. They are absent at the hearing today. However, in light of the above matters and the undertakings by the Plaintiff’s solicitors to the court, the hearing of the assessment of damages proceeded accordingly. 21.The Plaintiff called its manager of the import section, Mr Kan Chi-kai, Peter (hereinafter called “Mr Kan”), to give evidence. He adopted his witness statement dated 29 June 2005 as part of his evidence and he verified the Plaintiff’s claim. He confirmed that although he was the manager of the Plaintiff’s import section, he was familiar with the Plaintiff’s export procedure and he was also responsible for handling and dealing with export transactions for the Plaintiff’s customers. 22.Mr Kan said that the Defendant has been the Plaintiff’s customer since about the year 2000 for consignment of cargo by air. 23.On or about 2 February 2003, Mr Kan was informed by Mr F Wan, the Plaintiff’s sales manager, that the Defendant would place an order with the Plaintiff for the delivery of certain goods from Hong Kong to Morocco. 24.At about 5 pm on 5 February 2003, the Plaintiff received from the Defendant the Form and the Instructions duly completed by the Defendant. It was written on the Instructions that the subject consignment was nine cartons of timepieces. The Defendant represented that the Goods were timepieces readily exportable overseas in compliance with all legal requirements. 25.The Defendant informed the Plaintiff that the Goods were in its custody and control and kept at its place of business at Flat B, 13/F Minden House, Nos. 13-15 Minden Avenue, Tsim Sha Tsui, Kowloon. Arrangements were made to collect the Goods on the same day on 5 February 2003 from the Defendant’s office. The Goods were then delivered to the airport for air shipment. Since the Plaintiff had no connection with Gulf Air and would be unable to place the Defendant’s consignment on competitive terms, the consignment was placed through the Plaintiff’s business partner, AE Cargo Services Limited, under an airway bill issued on 6 February 2003. 26.At about 11 am on 6 February 2003, the officers of the Department examined the Goods and found them to consist of nine cartons of timepieces bearing suspected forged trade mark “CITIZEN”. After investigation, the Goods were confirmed to be counterfeits bearing forged that means “CITIZEN”. 27.On 18 July 2003, the Defendant was charged with the Offence. The Defendant admitted under caution that no attempt was made to inspect the nine cartons of Goods when they were in the Defendant’s custody and possession. The 1st and 2nd named Defendant were convicted of the Offence under their own plea. 28.The Department laid the Summons against the Plaintiff. The Plaintiff pleaded not guilty and retained its solicitors Messrs Raymond T M Lau & Co. and counsel Mr Kenneth Wong to appear on its behalf at the trial on 4 December 2003. The Plaintiff incurred $90,591.50 for its own legal costs (including counsel’s fees) in defending the Summons. Mr Kan confirmed that the Plaintiff had paid the Legal Cost to its solicitors. The Plaintiff was convicted after trial and subsequently paid the Fine as evidenced by a receipt dated 17 December 2003. 29.On balance, I accept Mr Kan’s evidence. The Defendant is plainly liable to indemnify the Plaintiff for the Fine, which the Plaintiff would not have incurred had the Goods given by the Defendant to the Plaintiff for air shipment not contain the forged trade mark. In respect of the Legal Cost, the Summons arose from the Goods which contained the forged trade mark and which the Defendant handed to the Plaintiff to arrange for air shipment. I accept on balance that it was reasonable for the Plaintiff to defend the Summons in light of the Department’s case against the Plaintiff noted in the Amended Statement of Facts provided by the Department. The fact that its defence was unsuccessful does not make the attempt less reasonable. 30.I have also considered the descriptions of work done and disbursements incurred and the amounts of the Bills. I accept that the involvement of counsel at the trial as well as counsel’s brief fee were reasonable. The Bills showed that the work done by the Plaintiff’s solicitors spanned over a substantial period, namely, from dealing with the events shortly following the search of the Goods by the Department to advising and attending the interview by the Department of the Plaintiff’s staff, to preparing for trial of the Summons as well as issuing various solicitors’ correspondence, carrying out legal research and giving legal advice. 31.I am satisfied that the Plaintiff is entitled to the amounts claimed. In light of my conclusions, there is no need for me to refer to the case of Osman v J Ralph Moss Limited [1970] 1 Lloyd’s Rep 313 cited by Mr Wong. 32.In the circumstances, I grant judgment in favour of the Plaintiff against the 1st and 2nd named Defendant in the sum of $98,591.50, being the Legal Cost and Fine, and interest thereon at the rate of 9.234 per cent per annum from the date of the writ of summons to today, and thereafter at judgment rate until payment. (Discussion re costs) 33.There is no reason why costs should not follow the event. I therefore order that costs of the assessment of damages (and all costs reserved, if any) be paid by the 1st and 2nd named Defendant to the Plaintiff, to be taxed if not agreed.
Mr Kenneth Y F Wong, instructed by Raymond T M Lau & Co., for the Plaintiff 1st and 2nd named Defendant, in person, absent |