Super Happy Investment Ltd v. Kot Hing Wah
Read the full judgment text of DCCJ 1510/2006 on BabelCite. This District Court judgment.
1. The disputes arose out of a Licence Agreement dated 16 January 2006 ("the Licence Agreement") whereby the Plaintiff licensed the use of a stall in a market to the Defendant.
Cites 2 cases
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DCCJ 1510/2006 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CIVIL ACTION NO. 1510 OF 2006 --------------------------------- BETWEEN
---------------------------------- Coram: Deputy District Judge R. Cheung in Court Date s of Hearing: 28th, 29th and 30th March 2007 Date of Handing down Judgment: 20th April 2007 ------------------- JUDGMENT ------------------- The Issues 1.The disputes arose out of a Licence Agreement dated 16 January 2006 ("the Licence Agreement") whereby the Plaintiff licensed the use of a stall in a market to the Defendant. 2.The Plaintiff's claim is grounded on contract. In essence, the Plaintiff's case is that the Defendant has been in breach of the Licence Agreement and hence the Defendant is liable to pay the Plaintiff the licence fees and rates due and payable thereunder as well as mesne profits/damages. The Plaintiff also claims for an Order for possession. 3.Before I outline the Defendant's case, it is necessary to give a fuller background of how the trial was conducted. 4.The Plaintiff was legally represented throughout. The Defendant appeared in person. 5.The Writ with Statement of Claim herein was issued on 24 March 2006. The Defendant filed a document entitled "Defence" on 20 April 2006. The "Defence" is homemade and it contains averments to the effect that the Plaintiff is liable to compensate the Defendant's loss. On a fair reading of the "Defence", it should be treated as a Defence and Counterclaim. Indeed, the Plaintiff has filed its Reply and Defence to Counterclaim on 6 May 2006. Not surprisingly, the Defence and Counterclaim is confusing, vague and imprecise. Broad allegations are made in respect of the Plaintiff's faults and failures but necessary particulars are lacking. 6.Neither the Plaintiff nor the Defendant has suggested that there should be a trial without pleadings. Hence, the pleadings should define the parameters of the case to be presented at the trial. Evidence should not be led on matters that are not pleaded nor should there be a finding of fact on a matter that has not been properly pleaded. 7.The Defendant has filed a witness statement ("the 1st witness statement") on 25 August 2006 that comes to 177 pages. The 1st witness statement contains many photographs taken on divers dates showing various areas of the market in question. 8.The Defendant has also filed another witness statement ("the 2nd witness statement") on 20 October 2006 that comes to about 28 pages which contains photographs and what purports to be the summaries of certain taped conversations. 9.In the 1st witness statement and the 2nd witness statement, the Defendant made many allegations against the Plaintiff. On a fair reading of the Defence and Counterclaim, some such allegations have been pleaded and some not. Of those that are not pleaded, some indeed would come as a surprise that they are raised at all. 10.The Plaintiff's stance was accommodating to an extent but not in every respect. The Plaintiff, for example, had indicated that it might object to the Defendant's giving evidence of the loss of his investment in relation to the market stall and his loss of business, on the ground that no such information had been provided in the 1st witness statement and the 2nd witness statement of the Defendant. 11.It is obvious that the Defendant's allegations are scattered and obscured in the many pages of his witness statements. There are photographs taken on different dates showing different areas of the market in question intended to illustrate different faults and failures on the Plaintiff's part. There are written comments by the side of the photographs, many of which are repetitious. 12.By way of illustration, in the witness statements of the Defendant, there are attached photographs of the market taken on 19th, 20th, 21st, 22nd and 25th of February 2006, on 6th, 10th and 15th, 22nd, 23rd, 24th, 27th and 29th of March 2006, on 3rd, 8th and 26th of April 2006, on 23rd May 2006 and 11th July 2006. 13.In the Defendant's other trial documents in Trial Bundle D, he presented inter alia photographs that he took on 10th, 12th, 14th, 15th, 16th and 17th of February 2006. 14.In such circumstances, I do not consider that it would be desirable to wholly dispense with the pleadings although under Order 18 Rule 21 of the Rules of District Court I do have the power to do so. 15.Pursuant to Order 18 Rule 22, I had at the start of the trial and before evidence was heard asked the parties to provide the Court with statements of the issues in dispute. Counsel for the Plaintiff had done his part and the Defendant had also done his part. Their statements of issues are kept on the Court's file. They are not helpful. 16.In the circumstances, I consider it appropriate for me to continue to look to the pleadings for identification of the issues for trial. The exercise is to be supplemented by enquiries in Court. On a fair reading of the pleadings, any matter that has not been raised as an issue is excluded and will not be engaged at trial. Conversely, any matter that has been raised as an issue will be engaged at trial notwithstanding any inaccuracy of expression. There are issues clearly raised in the pleadings which require no express mention. Some identified issues were canvassed and noted and agreed to be trial issues by the parties. 17.In relation to the trial issues, the following were noted. 18.The possibility of a breach of statutory duty on the part of the Plaintiff is not engaged. 19.The alleged presence of display shelves of the market stalls protruding onto the common passages said to have posed a risk of market patrons tripping over them is not engaged. 20.The alleged presence of broken floor tiles on the ground of the market said to have posed a risk of market patrons tripping over them is not engaged. 21.The alleged ineffective control of human flow during promotional activities of the market is not engaged. 22.The alleged presence of electrical wiring at the entrance of the market said to have posed a risk of electrocution of market patrons is not engaged. 23.The Defendant does not rely on the tort of nuisance. The allegation of " 滋擾" referred to in the Defendant's pleadings and witness statements actually refer to the Plaintiff's taking photographs of the Defendant at the market stall. There is the issue of whether the Plaintiff has committed the tort of wrongful interference of the Defendant's business. 24.The Defendant's contentions are based on contract and/or the tort of negligence. 25.There is the issue of whether the Plaintiff was under a duty in tort or in contract to exercise reasonable care to provide the Defendant with a reasonably safe business environment ("the safety duty"). The related issues are whether the Plaintiff was in breach of such a duty and if so, what remedies the Defendant is entitled to. 26.There is the issue of whether the Plaintiff was in breach of Clause 3(1) of the License Agreement. Clause 3(1) is the Plaintiff's covenant for providing quiet enjoyment ("the quiet enjoyment obligation"). The same related issues are engaged. 27.Clause 3(1) provides inter alia that the Defendant may "peacefully hold and enjoy the said stall during the said term without any interruption by the Licensor or any person lawfully claiming under or in trust for the Licensor." 28.There is the issue of whether the Plaintiff was in breach of Clause 3(4) of the License Agreement. Clause 3(4) provides for the Plaintiff's cleaning obligation ("the cleaning obligation"). The same related issues are engaged. 29.Clause 3(4) reads "To keep clean the central corridor gullies washing room storeroom toilets and public area." 30.There is the factual issue of whether the Plaintiff had authorised or permitted the entrances and passages of the market in question to be blocked. 31.There is the factual issue of whether the Plaintiff had authorised or permitted the operator of a bean curd stall to stock up bottles of liquid petroleum gas ("LPG") inside the stall and using the LPG to cook food inside the stall. 32.There is the factual issue of whether the Plaintiff had authorised, caused or permitted the anti-smoke doors of the market to be left open or ajar or locked. 33.There is the factual issue of whether the Plaintiff had caused or permitted the passage and other areas of the market in question to become slippery. 34.There is the factual issue of whether the Plaintiff had caused or permitted the toilet of the market to become unclean and slippery. 35.There is the factual issue of whether the Plaintiff had caused or permitted a scaffolding and working platform outside the market to become a safety hazard to the patrons of the market. 36.There is also the issue of whether the Plaintiff was in repudiatory breach of the Licence Agreement and that the Defendant had accepted such repudiation thereby terminating the Licence Agreement. This issue was not expressly noted but I consider that on a fair reading of the Defence and Counterclaim, this issue has been raised. The Witnesses 37.The Plaintiff has called 2 witnesses: PW1 and PW2. The Defendant has also testified. There is no acute conflict of evidence between their testimonies. Matters not in Dispute 38.It is not in dispute that the Plaintiff is the tenant and the Hong Kong Housing Authority is the landlord of the premises known as the Market area and Shop 2 on the Ground Floor of Tin Yan Shopping Centre at Tin Sui Wai under and by virtue of a Tenancy Agreement dated 13 September 2005. Under the Tenancy Agreement, the designated internal floor area to be used by the Plaintiff as market stalls is about 678 square metres. The other areas are reserved for use as common passages, refuse rooms, water closets, store rooms and other service rooms. The lease is for a term of 6 years commencing from 1 October 2005. The Tenancy Agreement contains provisions for the commodities and services to be provided in the market. The Tenancy Agreement incorporated the Plaintiff's Leasing Proposal as a part of the agreement. The Leasing Proposal contains provisions for the day to day management arrangements for the market. I consider that to be some evidence as to how the Plaintiff has been managing the market. 39.It is not in dispute that the Defendant has entered into the Licence Agreement with the Plaintiff. 40.The more salient provisions of the Licence Agreement are the following clauses: Clause 1, Clause 2(1), Clause 2(2), Clause 2(5), Clause 2(9), Clause 2(13), Clause 2(27), Clause 2(31), Clause 2(33), Clause 2(35), Clause 2(41), Clause 2(45), Clause 2(46), Clause 2(47), Clause 3(1), Clause 3(4), Clause 4(1), Clause 4(2), and Clause 4(12). I do not propose to set out the full text here. 41.Thus, the Defendant has agreed to pay the Plaintiff the sum of $18,000 per month for the use of Stall No. 1 ("the subject stall") of the market in question. The Defendant has also agreed to pay inter alia rates and default interest. The term of use is for a period of 2 years and 8 months and 15 days commencing on 16 January 2006 and expiring on 30 September 2008. 42.It is not in dispute that the floor plan at Trial Bundle C, page 19 (hereafter "C19", mutatis mutandis) shows the layout of the market in question. 43.It is not in dispute that the rates payable in respect of the subject stall is $380 per month as from 24 November 2005 onward. Since the Plaintiff's Statement of Claim pleads only $320.80 per month, I consider that the Plaintiff's entitlement should be limited to $320.80 per month. 44.It is a reasonable inference to be drawn and I am prepared to find that the other licensees of the market have entered into licence agreements with the Plaintiff on substantially the same terms and conditions as the Licence Agreement between the Plaintiff and the Defendant. Other Findings 45.Pursuant to the Licence Agreement, the Defendant was given possession of the subject stall on 16 January 2006. The subject stall was previously operated by one Mr. Tong Ho Yuen under the name of " 湯記鮮果". The Defendant continued to operate the business under the same trade name. The Defendant sold fresh fruits in his stall. 46.The Defendant said that by about the end of January 2006, he became dissatisfied with the way the market in question was managed. Of this, I am prepared to find that the Defendant had from about 22 February 2006 started to express in writing the various matters on which he said he was dissatisfied with the way the market was managed. The Plaintiff had suggested in the course of the trial that the Defendant was not doing a profitable business and that was the reason for the Defendant's quitting the business. I would make no specific finding on that. I do not have to. The odd feature of the Defendant's case is that the Defendant is a Constructional Safety Officer by profession and although he maintained that he had invested substantial sums of money in starting the business, he appeared to have given up his business venture within a rather short span of time after starting it. The reason behind all these is best known to the Defendant himself. 47.Since 1 February 2006, the Defendant has not been paying the licence fees and rates due payable under the Licence Agreement. 48.About 2-3 days before 20 February 2006, the Defendant began considering quitting his business. On 20 February 2006, the Defendant decided to quit his business. 49.It is not in dispute that the Defendant has ceased to conduct his business at the subject stall as from 21 February 2006. 50.Prior to 21 February 2006, the Defendant has not made any complaint in writing to the Plaintiff. 51.The earliest complaint in writing from the Defendant appeared in certain web-mails that he had sent to the Housing Authority on 22 February 2006 at D1-D4. The Defendant had directed most of his complaints to the Housing Authority instead of to the Plaintiff. 52.On about 28 February 2006, the Plaintiff issued a letter to the Defendant making reference to Clause 2(27) of the Licence Agreement. Clause 2(27) is about the Defendant's obligation to keep the subject stall in business. It provides that the Defendant should not cease business for more than 3 days in a row. In the letter, the Plaintiff warned the Defendant that unless he rectified his breach, the Plaintiff would take further action against the Defendant. 53.The Defendant did not respond to the above letter. 54.On about 11 March 2006, the Plaintiff through its solicitors issued a demand letter to the Defendant noting the Defendant's default in payment of the licence fees and rates payable under the Licence Agreement. The Plaintiff demanded for payment and the Defendant's resumption of his business at the subject stall. The Plaintiff also warned the Defendant of possible legal action and liability for costs on an indemnity basis in that event. 55.On 24 March 2006, the Writ with Statement of Claim endorsed herein was issued. 56.On about 26 April 2006, the Defendant held a meeting with the Plaintiff wherein the parties discussed the possibility of a settlement. However, nothing was agreed. The Defendant expressed his intention of retaining the possession of his stall. 57.I am prepared to find that the Plaintiff is indeed under a duty in tort and also implied under contract to exercise reasonable care to provide the Defendant with a reasonably safe business environment. The Plaintiff does owe the Defendant the safety duty. 58.I do not consider that a breach of the safety duty will necessarily amount to a repudiatory breach of the Licence Agreement. This is not to say that a breach of the safety duty can never amount to a repudiatory breach of the Licence Agreement. It all depends on the extent, nature and circumstances of the breach. Anti-smoke Doors 59.I accept that at the material times, some of the anti-smoke doors of the market were at times left ajar or opened. The Plaintiff did not do that. The Plaintiff had actually advised the market licensees not to do that. However, the market licensees often had to transport goods into the market by means of push-carts and their workers sometimes ignored the Plaintiff's advice and kept the anti-smoke doors open to facilitate their work. 60.There are about 10 anti-smoke doors at the market. I am unable to make precise findings as to how often and in respect of how many of the anti-smoke doors the above situation occurred during the operation hours of the market. 61.I do not accept that the anti-smoke doors were ever locked up during the operation hours of the market. The chains and padlocks on the anti-smoke doors were applied only after the operation hours of the market in question. 62.I am not prepared to find that there was a breach of the safety duty on the part of the Plaintiff under this head. If I were wrong on this such that there was a breach of the safety duty, I would nonetheless hold that there was no repudiatory breach of the Licence Agreement on the Plaintiff's part under this head. 63.There was no breach of the quiet enjoyment obligation or the cleaning obligation in this connection. Blocking of Passages 64.I accept that at the material times, the common passages of the market in question were often blocked to an extent such that they had become narrower. Actually the display shelves of the Defendant's stall were constructed in such a way that they protruded beyond the front line of the stall. I consider it to be probable that there were some other stalls constructed in a similar fashion although I am unable to make any precise finding as to how many there were. 65.I accept that the Defendant as well as the other market licensees had often placed or displayed their commodities beyond the boundary designated for their respective stalls, encroaching upon the common passages. 66.I accept that the Plaintiff had from time to time asked the market licensees to move their commodities back into their stalls. The market licensees would comply with the advice given when the Plaintiff's staffs were there. When the Plaintiff's staffs were gone, they resumed their previous modus operandi. 67.Some market licensees also placed their commodities near the exits of the market. 68.That said, I am not prepared to find that the blockage of the common passages and exits was very serious. I am not prepared to find that it posed a serious safety hazard. I am not prepared to find that the blockage situation had amounted to a breach of the safety duty on the part of the Plaintiff. 69.Even if the above were to constitute a breach of the safety duty, there was no repudiatory breach of the Licence Agreement on the part of the Plaintiff. 70.There was certainly no breach of the quiet enjoyment obligation or cleaning obligation in this connection. The Plaintiff did not authorise the wrongful encroachment/blockage of the common passages. Cleanliness in general 71.I am prepared to find that at times there were certain areas inside the market that had become unclean. I am not prepared to find that the standard of cleanliness in the market as a whole at the material times was below what one may reasonably expect of a market of this nature. Of the instances of unclean conditions shown by the Defendant, I am not prepared to find that they had remained to be unclean for an unreasonable length of time. I am prepared to find that technically speaking, the Plaintiff had been in breach of the cleaning obligation under Clause 3(4) of the Licence Agreement. I consider the circumstances of such breaches to be minor in nature. 72.I do not consider that such breaches amount to a breach of the safety duty on the part of the Plaintiff. 73.I do not consider that there was a breach of the quiet enjoyment obligation on the part of the Plaintiff in this connection. 74.There was no repudiatory breach of the Licence Agreement committed by the Plaintiff in this connection. 75.I am not prepared to find that such breaches of the cleaning obligation under Clause 3(4) of the Licence Agreement have caused the Defendant any loss. LPG cooking 76.The Defendant alleged that he was concerned with the use of LPG for cooking by the operator of a bean curd stall close to his stall. The bean curd stall is at Stall No. 25. 77.The Defendant's evidence is that he had never raised the complaint to the operator of the bean curd stall direct. He had never noticed any leakage of LPG in the market. 78.The Defendant said that before he quit his business, he was too busy minding his business and therefore before 21 February 2006, he had not made any written complaint to the Plaintiff about it. The 1st written complaint made by the Defendant in respect of the LPG matter appears in a Complaint Form dated 23 March 2006 which the Defendant had filled out and forwarded to the Housing Authority. The Defendant said that he could not remember if he had made any oral complaint in this connection before 23 March 2006. I find that before 23 March 2006, the Defendant had not made any oral or written complaint in relation to the LPG matters. 79.In the above Complaint Form, the Defendant noted his concern that the bean curd stall operator was in breach of Clause 2(33) of the Licence Agreement, that the bean curd stall had stocked up 4 bottles of LPG, that the bean curd stall operator used LPG to cook food, and that there was a risk of explosion. 80.The Defendant has produced photographs taken on 23 March 2006 showing the condition of the bean curd stall and related matters. They are at B109-B117. 81.I accept that the bean curd stall operator had been using LPG to cook food in the stall. I am not prepared to find that the bean curd stall operator had stocked up more than one bottle of LPG inside the stall. I do not accept that the Plaintiff had authorised or caused the bean curd stall operator to do so. I accept that the Plaintiff's management measures had not been effective enough to prevent the bean curd stall operator from doing so before or after 23 March 2006. The Plaintiff only conducted random patrols of the market on a rather infrequent basis although the Plaintiff did respond to complaints received and make site visits to investigate such complaints. 82.On about 23 May 2006, the Defendant took more photographs of the bean curd stall and they are at B158-159. PW2 acknowledged that there was a sighting that the bean curd stall operator did use LPG to cook that day. He made that visit upon receipt of the Defendant's complaint. 83.I accept that the bean curd stall operator's use of LPG to cook food in his stall is an added hazard. However, I do not accept that it posed a serious fire or explosion hazard. I am not prepared to find that there was a breach of the safety duty on the part of the Plaintiff. 84.Even if I were wrong on the above and that the LPG matter does amount to a breach of the safety duty on the part of the Plaintiff, I am not prepared to find that the breach has caused the Defendant any loss. 85.The Plaintiff has never authorised the bean curd stall operator to use LPG for cooking. The bean curd stall operator did so wrongfully in disregard of his contractual obligations owed towards the Plaintiff. I am not prepared to find that there was a breach of the quiet enjoyment obligation on the part of the Plaintiff in this connection. 86.There was certainly no breach of the cleaning obligation in this connection. 87.Even if it were correct that there were breaches of the safety duty in this connection, I am not prepared to find that such breaches would amount to a repudiatory breach of the Licence Agreement on the part of the Plaintiff. Photograph taking and interference with business 88.I accept that the Plaintiff had in the past taken photographs of the Defendant's stall when the Defendant was there. The Plaintiff took photographs of the many stalls inside the market to preserve evidence of the market licensees' encroachment upon the common passages. The Plaintiff did that to discourage the market licensees from persistent and excessive encroachment of the common passages of the market. The Defendant was not singled out although I accept that some of the Plaintiff's staffs had displayed a bad attitude in the exercise. I do not accept that the Plaintiff's staffs had on occasions spent minutes to take photographs of the Defendant's stall. I do not accept that such photograph taking amounts to an unlawful interference with the Defendant's business. There is no evidence that any customer of the Defendant were thereby induced or led to retract on their dealings with the Defendant. 89.The issue of whether the photograph taking would amount to a breach of the quiet enjoyment obligation was not engaged at the trial. Even if the issue were engaged, I would not be prepared to find that there was a breach of the quiet enjoyment obligation in this connection. Working Platform & Scaffolding 90.The Defendant mentioned the presence of a certain working platform at one of the entrances to the market which was not equipped with a toe-board. He said that it increased the hazard of tools etc. falling down and hitting the market patrons who would pass by below. I accept that the absence of a toe-board is an added hazard. However, there is no clear evidence of the nature of work carried out, how long the works were carried out and the time and manner in which the works were carried out. I am not prepared to find that this amounts to a breach of the safety duty on the part of the Plaintiff. 91.The Defendant said similar things in relation to a scaffolding at the external wall of the market. I do not accept the existence of a scaffolding per se is an added hazard to the market. In any event, the same observations in relation to the working platform are also applicable here. There is no breach of the safety duty on the part of the Plaintiff in this connection. 92.I do not consider that there was a breach of the quiet enjoyment obligation and the cleaning obligation. I do not consider that there was a repudiatory breach of the Licence Agreement in this connection. Slippery Areas 93.I accept that at times there were areas inside the market which became slippery. I am not prepared to find that the areas remained persistently slippery. I do not accept that the market at all material times was more slippery than one may reasonably expect of a market of such nature. I do not accept that this amounts to a breach of the safety duty on the part of the Plaintiff. 94.I do not consider that there was a breach of the quiet enjoyment obligation in this connection. The slippery condition per se did not constitute a breach of the cleaning obligation. 95.I do not consider that there was any repudiatory breach of the Licence Agreement in this connection. Toilet 96.The Defendant has made specific allegations about the condition of the male toilet of the market. I accept that the male toilet was at times unclean and slippery. I am not prepared to find that the male toilet had remained persistently unclean and slippery. I do not accept that the male toilet at all material times was more unclean and slippery than one may reasonably expect of a market toilet in Hong Kong. 97.I am prepared to find that technically speaking, the Plaintiff had been in breach of the cleaning obligation under Clause 3(4) of the Licence Agreement. I consider the circumstances of such breaches to be minor in nature. I am not prepared to find that such breaches have caused the Defendant any loss. 98.I do not consider that such breaches amount to a breach of the safety duty on the part of the Plaintiff. 99.There was no breach of the quiet enjoyment obligation. There was no repudiatory breach on the part of the Plaintiff. In all the circumstances 100.I do not consider that the Plaintiff was in breach of the quiet enjoyment obligation under Clause 3(1) of the Licence Agreement. I am not prepared to find that there was anything which would amount to such a breach during the period of the Defendant's occupancy. The Defendant quit his business and has not been operating his stall since 21 February 2006 except for a brief session on about 23 March 2006. I do not consider that a breach of the quiet enjoyment obligation is possible when the Defendant was no longer occupying and using the subject stall. Even if such a breach were possible without occupation and use of the subject stall, I do not consider the facts would justify the finding of a breach. 101.I accept that the Plaintiff has been in technical breach of the cleaning obligation under Clause 3(4) of the Licence Agreement. I am not prepared to find that the Defendant has suffered any loss arising from such breaches. 102.I do not accept that the Plaintiff has been in breach of the safety duty towards the Defendant. 103.I do not accept that there was any repudiatory breach of the Licence Agreement on the part of the Plaintiff. 104.In all the circumstances, the Defendant's counterclaim has failed. 105.I find that the Defendant has wrongfully failed to pay the Plaintiff the licence fees and rates payable under the Licence Agreement and hence the Defendant has been in breach. Possession of the Stall 106.I find that the Licence Agreement was terminated by the issue of the Writ herein on about 24 March 2006. Despite the termination of the Licence Agreement, the Defendant has wrongfully retained possession of the subject stall. The Defendant had evinced a clear intention not to give up possession of the subject stall during the meeting he held on 26 April 2006 with the Plaintiff. It is reasonable for the Plaintiff to resort to taking legal proceedings instead of exercising self-help in recovering possession of the subject stall. In any event, the Defendant has not pleaded a failure on the Plaintiff's part to mitigate its loss by recovering possession earlier and finding a substitute licensee. Licence Fees, Mesne Profits and Damages 107.The trial was conducted on the basis of what has been raised as issues on a fair reading of the pleadings. If a claim is thus raised, mere inaccuracy of expression ought not disentitle a party to Judgment. Counsel for the Plaintiff has indicated that the Plaintiff would seek mesne profits/damages for no more than the amount equivalent to a month's licence fee from the recovery of vacant possession of the subject stall notwithstanding the length of the still unexpired term of the Licence Agreement. I consider the Plaintiff's claim in this connection to be entirely reasonable and I take that the measure of mesne profits/damages should be equivalent to the amount of the licence fees payable under the Licence Agreement. In other words, the Plaintiff would be entitled to mesne profits/damages at the rate of $18,000 per month from 24 March 2006 until the expiry of about one month after the recovery of vacant possession of the subject stall. The Plaintiff is of course entitled to licence fees at $18,000 per month from 1 February 2006 to 23 March 2006. 108.The subject stall is now vacant. I can see nothing to prevent the Plaintiff from recovering possession of the subject stall once Judgment herein is handed down. The Plaintiff will therefore be entitled to damages for about one month from the date of handing down of this Judgment. That would be the cut-off point of the Defendant's liability. The Plaintiff would probably be able to "re-let" the subject stall in about a month's time after recovery of possession. 109.The Plaintiff may therefore recover from the Defendant licence fees from 1 February 2006 at the rate of $18,000 per month up to 23 March 2006 and thereafter mesne profits/damages at the same rate up to about one month after the handing down of this Judgment. This Judgment would be handed down on 20 April 2007. The Plaintiff would probably be able to re-let the subject stall on 20 May 2007. The period is 15 months and 20 days. The Plaintiff is therefore entitled to the sum of ($18,000 x 15.66 =) $281,880. 110.The Plaintiff has indicated that it would give credit to the Defendant of the deposit of $54,000 held by the Plaintiff. So the net amount that the Defendant would have to pay the Plaintiff would be ($281,880 - $54,000 =) $227,880. Rates 111.The claim for rates is contractual. The contract provision for rates does not survive through termination of the Licence Agreement. The Licence Agreement was terminated on 24 March 2006. The Defendant's liability for rates ended then. The Defendant is liable to pay the Plaintiff rates in the sum of $320.8 from 1 February 2006 to 23 March 2006. The amount is ($320.8 x 123/31 =) say $558. Default Interest & Interest 112.The Plaintiff has not asked for the inclusion of contractual default interest except as to the period from 1 February 2006 to 28 February 2006. The amount of such contractual default interest is small. The Plaintiff's approach on quantum has been flexible and accommodating. Its main concern is to recover possession of the subject stall. The amount of damages payable by the Defendant for his wrongful possession of the subject stall has been escalating with the passage of time since the issue of the Writ herein on 24 March 2006. I consider that discretionary interest under Section 49 of the District Court Ordinance should not start to accrue on any amount of damages which the Defendant was not then yet liable to pay the Plaintiff. That would make calculation a difficult task. In the circumstances, I would adopt a broad brush approach here. I would treat the Plaintiff as no longer asking for contractual default interest. I would dispense with discretionary interest under Section 49 as the Plaintiff has not insisted on it. There shall be mandatory interest under Section 50 as from the handing down of this Judgment, on the amount of ($227,880 + $558 =) $228,438. Indemnity costs 113.Under the Licence Agreement, the Plaintiff is entitled to indemnity costs. Applying Gomba Holdings (U.K.) Ltd. & Others v. Minories Finance Ltd. & Others, (1993) Ch 171, 30 January 1992, I consider that costs is a matter within my discretion but where there is a contractual right to indemnity costs, the discretion should ordinarily be exercised to reflect that contractual right. I note that Gomba Holdings supra was cited with approval in Church Commissioners for England v. Ibrahim & Another, (1997) 1 EGLR 13, 9 February 1996 and locally in Chekiang First Bank Limited v. Fong Siu Kin & Another, CACV 242/1996, 12 March 1997 and later applied in Yeung Kwok Fan & Another v. Standard Chartered Bank, HCMP 2308/2001, 13 November 2001. 114.There is nothing in the present case which persuades me that I should not award costs to the Plaintiff on an indemnity basis. I would award indemnity costs accordingly. The Plaintiff has clarified that it is not asking for a Certificate for two Counsel. Orders 115.In the circumstances, I would make the following orders:
Representation: Mr. Lee Yee Hung leading Ms. Angel Mak, instructed by Messrs. W.K. To & Co., for the Plaintiff The Defendant: appearing in person |