Tak Lee Steel Co v. Cheng Wai Yu t/a Eseetech Plastic Mould Fty

DCCJ 803/2006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 803 OF 2006

BETWEEN

Coram: Deputy District Judge Anthony Chow in Chambers (open to public)

Date of Hearing: 28^thh July 2006

Date of Handing Down Reasons for Judgment: 2^nd August 2006

--------------------------

JUDGMENT

--------------------------

1.This is an application by the plaintiff for interlocutory judgment under Order 14 of the Rules of District Court.  After hearing submissions from representatives of both parties, I gave the defendant unconditional leave to defend, I now give my reasons.

The Claim

2.The plaintiff claims against the defendant the sum of HK$173,670.05 with interest, being the purchase price of certain quantity of steel, sold and delivered to the defendant between December 2004 to May 2005.

The Defence and Counterclaim:

3.The defendant admits receiving some steel materials from the plaintiff; however these materials were not of the type nor quality as ordered.

4.The defendant alleged that the plaintiff knew the steel materials were for the purpose of making various steel moulds for the defendant's customers and due to the inferior quality of steel supplied by the plaintiff, the steel moulds made were not of merchantable quality.  As a result, the defendant suffered damages and therefore counter claim for damages to be assessed.

The law:

5.The legal principle is well known: The defendant must show that there are triable issues. He has to satisfy the court that he has a ‘real or bona fide defence.' If he makes an allegation, it must be credible or believable in the light of the evidence placed before the court. [Para 14/4/9 Hong Kong Civil Procedure 2006].

6.In Crown House Engineering v. Amec Projects Ltd. (1990) 6 Const. L.J. 141, Bringham L.J. (at page 154) stated:

“… Order 14 is for clear cases; that is, cases in which there is no serious material factual dispute and, if legal issue, then no more than a crisp legal question as well decided summarily as otherwise…. The procedure is entirely inappropriate where the plaintiff's entitlement to recover any sum is the subject of any serious dispute, whether of law or fact. This is not to say… that a defendant with no or no more than a partial defence can cheat a plaintiff of his just desserts by producing hefty affidavits and voluminous exhibits to create an illusion of complexity where none existed. Where the point at issue is at heart a short one the court will recognize the fact and act accordingly no matter how bulky its outer garments. But it does mean where there are substantial issues of genuine complexity the parties should prepare for trial…rather than dissipate their energy and resources on the deceptive attractive short-cuts.”   (Emphasis added)

Application:

7.Although the defendant admitted having ordered and received steel materials, but it alleged the plaintiff was in breach of their agreement by supplying materials of different quality then those specified in their agreement. The plaintiff's reply was simply putting the defendant to the strict proof.

8.The issue of this matter is whether the steel supplied by the plaintiff was of the type and quality agreed. This issue can only be resolved after full discovery and most likely expert testing of the products made from these steel materials. There is “serious material factual dispute” between the parties and summary judgment is clearly inappropriate.

Order:

Mr. Raymond Lee, of M/s Michael Cheuk, Wong & Kee, for the Plaintiff.

Mr. Patrick Tam, of M/s Andy Choi & Co., for the Defendant.