Cheng Hung Lai v. To Hing Kuen

DCCJ4576/2005

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 4576 OF 2005

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BETWEEN

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Coram : Her Honour Judge H C Wong in Court

Date of Hearing : 27 February & 7 April 2006

Date of Delivery of Assessment of Damages : 7 April 2006

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ASSESSMENT OF DAMAGES

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1.The plaintiff entered judgment against the defendant in default of intention to defend on 11 November 2005.  The plaintiff now applies for damages to be assessed.  The defendant has been absent throughout these proceedings.

2.The plaintiff, Miss Cheng’s, case is that she intended to buy a property for investment and she signed a formal sale and purchase agreement with the defendant on 5 May 2005.  She paid a total of 10 per cent deposit representing $93,000 at that stage.  Completion was to take place on 5 August 2005.  She duly paid over a cheque for the balance of the $930,000 purchase price which was $837,000 on the date of completion on 5 August 2005 to the solicitor acting for both the plaintiff and the defendant, Messrs Yuen & Partners.  She also signed the Assignment on that date, however, the defendant did not turn up to the solicitors’ office to complete the sale.  Miss Cheng was subsequently told by her solicitors, Messrs Yuen & Partners, that the property was repossessed by the mortgagee for the defendant had failed to pay up the mortgage instalments and therefore had committed a breach of the mortgage terms.

3.Subsequently she instructed solicitors who successfully retrieved from Messrs Yuen & Partners the purchase price she paid, the sum of $910,000, with $20,000 remaining outstanding.  Furthermore, Miss Cheng claims the loss of bargain in the present claim.  Miss Cheng obtained a valuation of the said property from Dudley Surveyors Limited on 6 September 2005.  The property, in Dudley Surveyor’s opinion, was valued at $1.17 million.  Miss Cheng then issued the present proceedings on 16 September 2005 against the defendant for the loss of bargain.

4.On 19 October 2005 she instructed her present firm of solicitors to write to the mortgagee bank, Standard Chartered’s, solicitors, Messrs Siao, Wen & Leung, to inform them of the writ against the defendant.  On 18 November 2005, Messrs Siao, Wen & Leung, sent over, with a covering letter, a cheque for the sum of $159,480.64, being the surplus and balance of the sale price after the bank deducted the debt and expenses.

5.Since final interlocutory judgment in this action was granted on 11 November 2005 against the defendant, what remains for this court to consider is the assessment of Miss Cheng’s loss.  Mr Kwong, the plaintiff’s solicitor, asked that the assessment of Miss Cheng’s loss be made based on the valuation of Dudley Surveyors’ valuation of $1.17 million and the purchase price under the same purchase agreement between the plaintiff and the defendant on 5 May 2005, that is, $240,000 plus $20,000 deposit, a total of $260,000.

6.The Valuation Report of Dudley Surveyors was done without an inspection of the interior of the property.  It was valued on the assumption that the interior was maintained in a reasonable condition and the said property was free from encumbrances and sold with vacant possession at $1.17 million.  However, the property was repossessed in a mortgagee action by the bank and it was sold as such on 28 October 2005 by the mortgagee bank, the Standard Chartered Bank, for the sum of $1.13 million.

7.After careful consideration of the evidence and Dudley Surveyors Valuation Report, I assess the plaintiff’s loss of bargain to be the mortgagee sale price of $1.13 million and her purchase price of $930,000.  Her loss, therefore, comes to $200,000 plus the $20,000 deposit that she failed to recover from the defendant.  On the other hand, Mr Kwong asks for the recovery in the sum of $159,480.64 plus costs because this is a sum that the mortgagee bank’s solicitor had released after deduction of the debt to the bank and the expenses of sales, etc.  I therefore allow the said sum of $159,480.64 to be the assessed loss to the plaintiff.

8.Costs to the plaintiff, to be taxed if not agreed.

Representation:

Mr Simon Kwong Ting-chung of Messrs Kevin L.H. Kwong & Co., for the Plaintiff

Defendant, in person, Absent