Yan Ho Chiu t/a Harvest Prosper Co v. Charmgold Intenational Ltd
Read the full judgment text of DCCJ 4810/2004 on BabelCite. This District Court judgment.
1. A contract was entered into on or about mid May 2004 between the Plaintiff as supplier and the Defendant as purchaser of 200,000 pieces of FM Scan Radio on the terms set out in or evidenced by Purchase Order No.CGPO-0020-04 dated 3 rd June 2004 (“the Contract”) at the price of US$121,600.00 (i.e.: HK$948,480.00 at the rate of US$1 = HK$7.8).
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DCCJ 4810/2004 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CIVIL ACTION NO. 4810 OF 2004 -------------------- BETWEEN
-------------------- Coram : Deputy District Judge K. Lo in Court Date of Hearing : 3rd – 5th January 2006 Date of Final Submission : 5th January 2006 Date of Handing Down Judgment : 31st March 2006 J U D G M E N T Background 1.A contract was entered into on or about mid May 2004 between the Plaintiff as supplier and the Defendant as purchaser of 200,000 pieces of FM Scan Radio on the terms set out in or evidenced by Purchase Order No.CGPO-0020-04 dated 3rd June 2004 (“the Contract”) at the price of US$121,600.00 (i.e.: HK$948,480.00 at the rate of US$1 = HK$7.8). 2.The parties also agreed that the Defendant should cause to be made 2 sets of mould to expedite the production of the goods under the Contract as the production time schedule was very tight. 3.On 11th June 2004, the parties also revised the Contract and entered into a new contract, reference Purchase Order no. (GP) – 0020 – 04 REV 1 (the “Revised Contract”) which substituted the Contract. 4.The terms of the Revised Contract had different Shipment dates from that of the Contract. 5.Under the Revised Contract, the Plaintiff was responsible for all purchase of production, including arranging moulds, buying materials, assembling and transportation of finished products to the shipper and that 2 sets of moulds and materials were supplied by the Plaintiff accordingly. 6.The Delivery Schedule under the Revised Contract was set out as follows: -
7.Subsequently, the Defendant said he placed an additional order of 10,000 pcs. of goods with the Plaintiff by revising the Purchase Order No. (GP) – 0020 – 04REV1 by fax. 8.The Plaintiff had in total accepted 2 payments amounting in total to HK$130,000.00 from the Defendant as “advance payment” or part payment. 9.It was not in dispute that only 15,500 pcs. of goods were manufactured by the Plaintiff, the other goods were also manufactured by Dongguan Silverlit Toys Company (“Silverlit”) with materials supplied by the Plaintiff. 10.The parties at trial agreed that the actual delivery dates and the actual amount of goods delivered were as follows: -
11.The contract price for the 210,000 pcs. of goods (“the said goods”) was HK$995,904.00 (equivalent to US$127,680.00 at the rate of US$1.00 = HK$7.80). 12.In the Amended Statement of Claim, the Plaintiff claims $717,431.20 from the Defendant, i.e.:
13.The Defendant on the other hand counterclaims against the Plaintiff for late delivery of the goods under the Revised Contract and they claimed against the Plaintiff for, $1,663,698.94 (Choi’s Statement) or, the sum of $1,631,898.91 (Defence and Counterclaim) as damages suffered by them. The same included, inter alia, $597,542.40 (i.e. $995,904 x 2% x 30 days) being the agreed sum under the Revised Contract for late delivery of goods together with the reimbursement of $688,184.98, i.e. subcontracting fee paid to Silverlit by the Defendant for production of the goods, $220,411.53 extra air freight charges incurred by the Defendant as a result of the late shipment and loss of $125,760.00 (i.e. RM62,880.00 at the rate of RM1 = HK$2) suffered by the Defendant being the deduction from the purchase price by Defendant’s purchaser Art Idea from monies payable to Defendant. Defendant also claims mould charges of $28,000.00 and fee for trip to Malaysia in sum of $3,800.00. Plaintiff’s Case 14.The Plaintiff said the Revised Contract was terminated by the Defendant on or about 13th June 2004 and that the parties had agreed that the Defendant would arrange Silverlit to finish production of the remainder of the goods on the understanding that the Plaintiff would finish the production of 15,500 pcs. of goods. 15.Plaintiff said the Defendant agreed: -
16.Plaintiff said as a result of the new agreement between the parties, he had delivered 15,500 pcs. of goods to the Defendant and accepted by the Defendant. 17.He said he had also arranged the transport of materials for the production of 184,500 pcs. of goods to Silverlit and arranged for transport of the goods produced by Silverlit to Defendant’s agent Schenker Stinnes Logistics (“SSL”) and was accepted by them. 18.Plaintiff further said on 25th June 2004, Grace Chan of the Defendant requested for further materials for production of extra 10,000 pcs. to which the Plaintiff said he did arrange and had provided the same to Silverlit. He said he had also arranged for the transport of these 10,000 pcs. of goods from Silverlit to SSL and had incurred costs. He said again the goods, like all other goods previously transported were accepted by SSL. 19.Further, Plaintiff said in late July, again Grace Chan of the Defendant ordered extra materials for 3,000 pcs. and the Plaintiff did deliver the same to Silverlit and did also later deliver the finished product from Silverlit to SSL. Again the same was accepted by SSL. Plaintiff said he had incurred further cost in that regard. 20.Plaintiff said he did deliver in total 210,000 pcs. of goods to SSL. 21.Plaintiff says as the Revised Contract had been terminated, the clause therein where it says that the Plaintiff should be liable to pay 2% per day on the total value of goods late for delivery does not further apply. 22.In any event, Plaintiff says that the said clause is penalty clause rather than a liquidated damages clause and should not be enforced. 23.He claimed for all expenses claimed as aforesaid. 24.In Court, Mr. Yan Ho Yin (“Yan”) of the Plaintiff testified that he thought that once the Contract was terminated and the production entrusted to Silverlit, the Plaintiff should not be responsible for the late shipment and Silverlit should be able to deliver the goods in time, he said otherwise why should the work be entrusted to Silverlit. 25.Yan said the appointment letter dated 10th June 2004 was in fact signed at least few days later by his son without his knowledge and/or consent. 26.Yan said in fact at the material times, he had in mind other factories which could cater for the production but as Choi of the Defendat insisted to terminate the Revised Contract, he allowed them to do so. Defendant’s Case 27.Monic Choi (“Choi”) of the Defendant says the Delivery Schedule under the Revised Contract must be strictly adhered to. 28.It was said that in or about 10th June 2004, the Plaintiff said to the Defendant that the foreman was unable to manufacture and deliver the goods in accordance with the Delivery Schedule. 29.Choi says that it was later agreed that the Plaintiff should engage Silverlit as a subcontractor in the production of the remainder of the goods (apart from 15,500 pcs. manufactured by the Plaintiff) and they did. 30.Choi says as a result of the agreement, the Plaintiff had signed a letter of appointment dated 10th June 2004 whereby the Plaintiff appointed Silverlit to manufacture as a subcontractor. 31.Defendant says the Plaintiff failed to deliver the goods in accordance with the Delivery Schedule and had delayed the shipment of the goods as aforesaid. 32.Defendant says under the Revised Contract, the Plaintiff had agreed to bear all responsibilities for compensation and expenses for late delivery of the goods and agreed to pay to the Defendant compensation/ loss at the rate of 2% per day of the total value of the goods. 33.Defendant says the Revised Contract contains the following terms: -
34.Defendant says that the goods were ordered for the onward sale to Art Idea Manufacturing (“Art Idea”) which in turn supplied goods to KFC Holdings (Malaysia) Bhd (“KFC”). He says that the Plaintiff was aware of this at time of Revised Contract. 35.Defendant says as a result of delay in shipment, he had arranged for the goods to be air freighted and had incurred $220,411.53 extra on air freight charges as opposed to shipping charges for the late shipments. The Defendant averred that the delay was due to, inter alia, the failed inspections in late May 2004 and alternatively that the Plaintiff is liable to reimburse the Defendant of the same as damages incurred by the Defendant as a result of breach of contract by the Plaintiff. 36.Defendant also says that as the Plaintiff failed to pay Silverlit, they had paid on Plaintiff’s behalf the sum of $688,184.98 subcontracting fee to Silverlit, order invoice no. DJV004/04SC dated 21st July 2004. 37.Defendant says they had no choice but to pay the Silverlit as it was them that introduced Silverlit to the Plaintiff. Defendant says therefore they should be entitled to recover the same from the Plaintiff. 38.Defendant also says that Defendant is entitled to the contractual sum of $597,542.40 payable under the contract for delay in delivery. 39.Further, the Defendant says it was a term of the Contract between Art Idea and the Defendant that if shipment was not on time, the Defendant would take all liability from Art Idea. In this case, KFC has deducted HK$125,760.00 (RM 62,880.00) from payment to Art Idea and therefore Art Idea has deducted similar sum from the payment due to the Defendant which they now claimed from the Plaintiff. 40.Defendant says the price for first set of mould had all along been included in the said Revised Contract and the price for the second set of mould was only $28,000.00 as evidenced by invoice dated 13th May 2004 which the Defendant alleged he had paid. 41.He said originally Art Idea had agreed to pay for the mould, but now as there was late shipment, they had refused to pay. 42.Defendant says that on 23rd July 2004, the Plaintiff had issued an invoice in sum of US$127,680.00 being price of the goods. 43.Further, the Defendant says that as some goods were defective, KFC had asked for replacement goods of 10,000.00 pcs. and therefore they had revised the Revised Contract by consent on 3rd July 2004 so that total goods ordered were 210,000 pcs. 44.Defendant said of the $130,000 paid to the Plaintiff, $30,000.00 were paid on 9th July 2004 subsequent to the increase in ordering. 45.In the Rejoinder, the Defendant says that 209,500 pcs were delivered by the Plaintiff whereas at trial, they admitted that the Plaintiff had delivered in total 210,050 pcs. 46.Defendant says even as early as on or about 11th June 2004, Monic Choi (“Choi”) of the Defendant had requested Tony Yan (“Yan”) of the Defendant that as the shipment was late, the Plaintiff needed to ship by air whatever quantity he managed to produce and he would be responsible for the air freight charges to which Yan agreed. 47.Choi said the subcontracting came about when there was manpower problem in the Plaintiff’s factory and there were grave doubts as to whether the Plaintiff’s factory could manufacture the goods. 48.Choi admitted that Silverlit was actually, to the knowledge of all parties concerned, the parent company of the Defendant and of which both Choi and her assistant Grace Chan (“Chan”) also held a post. Choi said under cross-examination that in fact the accounting staff of Silverlit and the Defendant was common. 49.Defendant also said as a result of the defective quality of some of the goods supplied and the late shipment, KFC had suffered delay in promotion resulted in waste in airtime penalty, delay in newspaper time slot penalty, operational costs and freight charges and warehouse operation charges totalling the said RM 62,880.00 which they had deducted from Art Idea, whom in turn deducted the same from the monies due to the Defendant. 50.Defendant says due to the delay, Art Idea had also refused to pay for the new set of mould which they had originally agreed to pay. 51.Grace Chan (“Chan”), the managing executive of the Defendant says that prior to the Contract or the Revised Contract, Yan of the Plaintiff was fully aware that time was important in the Contract/ Revised Contract but later it turned out that the production capacity of the Plaintiff factory and the mould was flawed and therefore parties had no choice but to entrust the production to Silverlit. Reasons for Decision Was the Revised Contract between the parties terminated when the production work was tendered to Silverlit? 52.This Court has no doubt that the Revised Contract was still subsisting when the Plaintiff agreed, upon strong persuasion of the Defendant, to subcontract the production process to Silverlit, the mother company of the Defendant. 53.There was the appointment letter by the Plaintiff to Silverlit dated 10th June 2005 although this Court accepts that the same was backdated and was signed later than the 10th June 2004. 54.Had the letter been wrongly issued by Yan’s son to the knowledge of Yan, Yan would have rectified the same by correspondence to protect himself. Instead, he explained to the Court that although he was aware of the issue of the said letter, he failed to send a letter to rectify as he did not have sufficient legal knowledge. 55.On 23rd July 2004, Plaintiff had sent an invoice to the Defendant asking for US$127,680.00 (HK$995,904.00) which in fact was the contract price for 210,000 pcs of goods. If the Revised Contract was really terminated, why would they do so? 56.Thirdly, when the Defendant wanted to make the extra order of 10,000 pcs, they had revised the Revised Contract and faxed the same to the Plaintiff. If in fact, the Revised Contract was terminated, why would they do so? 57.Fourthly, if the Revised Contract was terminated, why would the Plaintiff agree (which he admitted in Court) to pay for the airfreight charges for the late shipment? 58.Fifthly, why would the Plaintiff on 8th July 2004 when issuing the receipts to the Defendant for receipt of $30,000.00 still described the payment by the Defendant as part payment for the goods as opposed to the part payment for the expenses as claimed by the Plaintiff in the pleadings? 59.Sixthly, why did the Plaintiff depart from the usual mode of endorsing such termination agreement or new contract in writing? 60.Further, why would the Defendant bother to ask for assistance of the Plaintiff to arrange for transport of the finished product if the contract was terminated. Silverlit is and was a factory of substantial size, they could easily arrange for the same. 61.In reaching this conclusion, the Court had already considered the fact that Silverlit did issue the invoice to the Defendant rather than the Plaintiff. 62.It is a fact that the Defendant did pay the monies of Silverlit and now seek to offset the sum payable to the Plaintiff under the Revised Contract. As the Defendant and Silverlit are related companies, the Defendant might want to pay Silverlit direct instead of passing the money to Plaintiff and this might explain why Silverlit had issued the invoice in this way. One should bear in mind that the accounting department staffs of both the Silverlit and Defendant are common. In fact, in Court, Choi admitted this to be so. Should the Plaintiff be liable for the late delivery? 63.Under the Revised Contract dated 11th June 2004, the scheduled 1st shipment was 30,000 pcs. on 12th June 2004. 64.It was agreed that not a single delivery was punctual in the agreed quantity. 65.Plaintiff argued that should the Defendant not have recommended Silverlit to be able to complete the production in time, why would the Plaintiff entrust the production to Silverlit. The Plaintiff says that they would only entrust the production to a subcontractor who could produce in time. 66.According to the Defendant, at the material times, for reasons not before this Court, the workers of the Plaintiff’s factory was leaving in bulk and as late as 10th June 2004, the mould was still with problem. This might explain why the parties had agreed Silverlit, a factory of a substantial size to undertake the production. 67.Choi in Court testified and said she only told Yan that Silverlit would do the best they could to meet the deadline. She denied that she did tell the Plaintiff that Silverlit could definitely be able to meet the Delivery Schedule. 68.Yan himself in Court admitted he was willing to pay the additional air freight charges. Had Silverlit been clearly in breach of the Contract, why would Yan do so? 69.In any event, the relationship between the Plaintiff and Silverlit was one of the subcontracting relationship and as the Revised Contract was still alive and binding, the Plaintiff as against the Defendant should be responsible for the delay of the goods. Is the clause “Seller agree to pay to buyer 2% per day of the total value for delaying the delivery as per above shipment schedule if the delay shipment which was not caused by the buyer, therefore the seller will be bear the fully responsibility for compensation” enforceable? 70.Plaintiff argues the same is a penalty clause and is unenforceable. Plaintiff says that the clause should only apply to late shipment only and that it is wrong for the Defendant to claim as if all the goods were late for the same period. 71.He referred this Court to the case of Dunlop Penumatic Tyre Co. Ltd. v. New Garage and Motor Co. Ltd. [1915] A. C. 79, 86 – 88. 72.In that case, Lord Dunedin said that: -
73.This case was quoted in Chitty on Contracts, 29th Edition P.957. 74.In the present case, the clause imposes a formula to calculate the amount of compensation, based on the total value of goods instead of total value of goods late for shipment, irrespective of the proportion of the amount of goods shipped/ delivered late. Clearly, the loss and damage to the purchaser of the goods must be dependent upon the amount of goods delivered late and the extent of such delay, otherwise, why would the Defendant insist on accepting, via its agent, partial shipment throughout? 75.Although the Revised Contract did explicitly specified under Remarks Clause 2 that “The Partial Shipment is not allowed”, it is a fact that the goods were shipped in parts of the scheduled shipment amount and the Defendant had accepted these partial shipments throughout. In fact, Choi in Court said that she told Yan to ship whatever amount of goods ready for shipment, albeit partial shipment by air to satisfy the purchaser. 76.The clause could not therefore be forcefully argued as a genuine pre-estimate of the loss and damage suffered by the buyer under the Revised Contract, i.e. the Defendant. 77.The clause would therefore be considered by this Court as a penalty clause, a clause imposed in terrorem of the offending party. The same is therefore unenforceable here. Remoteness of other damages claimed by the Defendant 78.It is not disputed that the Plaintiff knew the goods in question was promotional goods for the use of KFC as there was printed logo on the goods and that the goods was supplied to the Defendant for onward sales to 3rd party. In Court, Yan admitted his knowledge that KFC was using the goods for promotion and that he knew time of delivery was important in this case. 79.Choi said that Yan had agreed to pay for air freight charges incurred as a result of the delay shipment, which Yan admitted. 80.In any event, a buyer of goods may claim damages for the extra expenses which he has incurred as a result of not having the goods delivered on time, as long as the expenses are within the reasonable contemplation of the parties, at the time of the contract, as not unlikely to result from a delay in delivery: Benjamin’s Sale of Goods, 6th Edition, §17-045. Air-freighting the goods when they were delivered late to attempt to satisify the Defendant’s obligation under its contract with Art Idea is clearly something that falls within the reasonable contemplation of the parties at the time of the Contract. 81.The sum of $220,411.50 represents the extra air freight expenses actually incurred by the Defendant after deducting the share of the costs shouldered by Art Idea as well as what the Defendant would have incurred by way of sea freight. 82.The Plaintiff should therefore be responsible for the sum of $220,411.50. 83.Coming to the other claims of loss and damages by the Defendant, the Plaintiff argues that these items are too remote. 84.He quoted the case of Victoria Laundry (Windsor) Ltd. v. Newman Industries Ltd. [1949] 2 KB 528. Three main propositions in the Victoria Laundry case were:
85.In the case of The Heron II [1969] 1 A.C. 350, Lord Reid said:
Lord Reid and Lord Upjohn criticized the words “foreseeable” or “reasonably foreseeable” in the Laundry formations. 86.Lord Upjohn expressly preferred “contemplate” or “in contemplation” for cases in contract. 87.In Benjamin’s Sale of Goods, Sixth Edition, para 17-044, it says where the seller contemplates a resale (or ought to have done so) but delays delivery till after the due date, he will be liable to buyer in respect of the latter’s liability in damages to his sub-buyer caused by the seller’s delay. 88.The case of Elbinger Actien-Gesellschaft v. Armstrong (1874) LR 9 QB 473 was referred to and it was said that the buyers in that case were entitled to at a minimum “reasonable compensation for the loss of the use of the waggons” during the delay but the court was also willing to include “the probable liability of the plaintiffs to damages by reason of the breach through the defendant’s default of that contract to which, as both parties knew, the defendant’s contract with the plaintiffs was subsidiary. 89.In the present case, it was plain that the Plaintiff knew the goods was for the use of KFC, the ultimate user as the shipping marks bear “KFC Spiderman”. It shows that the Plaintiff must know that there is sub-purchaser in this case. In any event, Purchaser admitted this in Court. 90.Here, the Defendant produced evidence from Art Idea that they were not willing to pay for the extra mould in sum of $28,000.00 and that the sum of $125,760 (i.e. RM 62,880.00) was also deducted from monies payable to them from KFC. 91.Having regard to the discussion on remoteness of damages aforesaid, this Court does not find these 2 items remote. 92.Defendant therefore did not need to pay for the $28,000.00 set of mould and further they are entitled to deduct from the balance of the price of the goods the said sum of $125,760.00 and the airfreight charges of $220,411.53. 93.This Court finds however the claim on airfare highly remote and in any event, this Court is not persuaded that the trip undertaken by the Defendant was for the sole purpose of trying to negotiate a lower penalty from KFC. 94.As for the sum of $688,184.98 paid by the Defendant to Silverlit, clearly contractual relationship existed between the Plaintiff and Silverlit, therefore only Plaintiff is legally obliged to satisfy Silverlit for the production expenses. 95.Silverlit is fully aware of this because the appointment letter dated 10th June 2004 stated clearly that the Plaintiff has subcontracted the production works to Silverlit via the Defendant, therefore Silverlit was at all material times fully aware that the principal in this subcontracting was the Plaintiff and not the Defendant. Furthermore, as Choi and Chan are both staffs of Silverlit and the Defendant, they have actual knowledge of the same, Silverlit would not be mistaken. Silverlit should only be entitled to recover production costs from the Plaintiff. 96.On evidence before this Court however, there was no express agreement between the Plaintiff and Silverlit as to the amount of subcontracting charges. 97.The same had not been agreed before or during the period when subcontracting work was undertaken by Silverlit. 98.In fact, by the invoice dated 21st July 2004, Silverlit had unilaterally stated the sum to be $688,184.98 and the Defendant had paid the same. There was no evidence before this Court that there was authorization from the Plaintiff to the Defendant to do so. In fact, Yan denied any such consent/ authorization or even knowledge of this invoice. 99.Plaintiff considered that the sum of $275,235.80 was a reasonable figure for such production. In their letter to the Defendant dated 17th August 2004, they stated this sum to be the production charges. 100.Defendant argued that they had no choice but had to settle the invoice of Silverlit because they were the one who instructed Silverlit to do the work, upon authorization by the Plaintiff. 101.As discussed earlier, Silverlit at all times was aware the principal was the Plaintiff, this was not a case of undisclosed principal, the Defendant was therefore not legally obliged to settle the invoice. They were in my view just a volunteer in settlement of the invoice and was not entitled to seek reimbursement/ offset from the monies that the Plaintiff was otherwise entitled to. 102.In Court, Choi when cross-examined said that the Defendant only had liability to chase the Plaintiff for payment of the invoice but had no legal obligation to pay the same later. Later, she changed her version and said they had such liability to pay the invoice if they could not locate the Plaintiff or Yan. 103.When further cross-examined as to whether Choi or the Defendant did try to locate Yan and inform him of the invoice, Choi said she remembered she did try to contract Yan but she forgot if she was able to contact Yan. Later, her evidence shifted and she said she did not contact Yan as she thought that Silverlit had already told Yan of the invoice. 104.In fact, Choi had been evasive when asked about relationship between the Defendant and Silverlit, it was only via Chan that it was revealed that the accounts clerk of the 2 companies was common staff. 105.Chan had also tried to distance Silverlit from the Defendant when she told the Court that Silverlit is a big factory without disclosing readily of the fact that she herself is also staff of Silverlit, so is Choi and the accounts and that they share the same office or that Silverlit is the mother company of the Defendant. 106.At one stage, she went further to say that at a certain meeting, though Choi, herself and Yan were there, it appeared to her that no one from Silverlit were there. In fact, of course, both Chan and Choi were also staff of Silverlit. 107.The Plaintiff had referred this Court to the Court of Appeal case of Owen v. Tate and others of 27th November 1974 where it was held that: -
108.Scarman J. in that case stated that: -
108.In our case, Yan of the Plaintiff said he never received the invoice from Silverlit. He said further that neither Choi or Chan or anyone of the Defendant did consult him or seek authorization from him regarding the payment of the said invoice. No one had mentioned to him the figure of $688,184.94 as the subcontracting fee. 109.Although the Plaintiff did not plead lack of authority on the part of the Defendant to pay the said invoice, neither did the Defendant plead that they had authority to do so save that the did make such payment. 110.Clearly there is no legal obligation obliging the Defendant to pay the said invoice. 111.In fact, in cross-examination, Choi did admit that the invoice was issued by Silverlit for attention of the Defendant as there was discussion among themselves and they decided that instead of the Defendant paying money to the Plaintiff and for the Plaintiff to pay Silverlit, it would be more convenient for them to have the short cut of the Defendant paying Silverlit and deducting the sum from the monies that the Defendant is due to the Plaintiff. 112.Choi in the court agreed that the Defendant should pay the Plaintiff and for the Plaintiff in turn to pay Silverlit. 113.Having regard to the aforesaid and the principles in the case of Owen v. Tate and others, the Defendant was merely a volunteer when making the payment for the invoice. They are therefore not entitled to reimburse from the Plaintiff. Clearly, it is not just and reasonable that the right of reimbursement should arise in this case, in particular have regard to the relationship between the Defendant and Silverlit and the fact that the sum of $688,184.98 had never been agreed or even ascertained, having reference to an agreed standard. 114.Under the Revised Contract, of which the quantity of the goods had subsequently been revised to 210,000 pcs of goods at US$0.608 each, the total price payable by the Defendant for the goods was HK$995,904.00 i.e. US$127,680.00. 115.A sum of $130,000.00 was paid as deposit by the Defendant to the Plaintiff. 116.The claim of $28,000.00 i.e. the price for the second mould set was not allowed as Art Idea had rightly refused to pay the same, even though previously agreed due to late delivery of goods as the the second set of mould was made to expedite production of goods to meet the tight schedule. 117.Then, there was the allowed deduction of $220,411.53 extra airfreight charges and the said $125,760 loss and damages. 118.As for the other claimed expenses of the Plaintiff, the same was not proved by the Plaintiff now that this Court has ruled that the Revised Contract was still in existence and the costs of material expenses etc. were all covered in the manufacture costs of goods. 119.In conclusion, this Court gives judgment to the Plaintiff in the sum of $519,732.50 (i.e. $995,904.00 less $130,000.00 paid, and less $220,411.53 airfreight charges and less $125,760.00 deduction charged by KFC). 120.I also make an order nisi that Defendant do pay the Plaintiff costs of this action, with certificate for counsel, the same to be taxed if not agreed, the same to be made absolute within 14 days thereafter.
Mr. Kwong Ki Tak instructed by Messrs Wong & Co. for Plaintiff. Miss. Eva Sit instructed by Messrs. Benny Kong & Peter Tang for Defendant. |