Purelands International Ltd v. J. v. Fitness Ltd t/a California Fitness

DCCJ 1228/2009

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 1228 OF 2009

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BETWEEN

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Coram : Deputy District Judge Osmond Lam in Chambers

Dates of hearing  :  19^th June, 2009

Date of handing down Decision  :  30^th July, 2009

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DECISION

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1.By a summons dated 7^th April 2009 the Defendant applies to stay all further proceedings in this action on the ground that this case should be tried in the Singapore Court where an action in respect of the same subject matter has been commenced.

2.In short, the Defendant claims that the Singapore Court is clearly or distinctly a more appropriate forum for trying the dispute in this case than Hong Kong.

3.I shall adopt the same abbreviations of JV Singapore for JV Fitness PTE Ltd in Singapore and JV Hong Kong for JV Fitness/California Fitness in Hong Kong that all parties are using.

4.The matter arose in this way.

5.After some negotiations, there was a quotation dated 26^th October 2007 signed between the Plaintiff and JV Hong Kong (and here using the name California Fitness only), the Plaintiff agreed to supply and install rubber floor mats at a fitness centre in Singapore by the name of Bugis Club at the price of US$56,879.00.

6.On the other hand, there was also a deposit invoice dated 8^th November 2007, signed and issued by the Plaintiff to JV Singapore for deposit to be paid. The deposit was paid, but paid through JV Hong Kong office with its company cheque. When the Plaintiff was looking for the payment of the initial deposit, it was allegedly told by a staff of the Defendant called Mr. Billy Yip to look to JV Singapore for payment. As a result, all other invoices for the settlement of the remaining amount were sent to JV Singapore for payment.

7.The dispute arose when it was alleged that the Plaintiff s works were defective and as a result JV Singapore refused to settle the payment and also commenced proceedings in the Singaporean court on 3^rd March 2009. On 11^th March 2009, the Plaintiff was notified of the said proceedings and on the following day, the Plaintiff commenced the present proceedings in the District Court of Hong Kong.

8.Here in Hong Kong, the Plaintiff claimed for the balance of the deposit in the sum of HK$221,828.10 whereas JV Singapore sued for the return of deposit paid in the sum of US$28,439.50 and the costs of rectifying the defective works.

9.It can be seen that the two sets of proceedings are parallel and concerned with the same subject matter of the dispute.

10.The questions to be decided are two-fold. First, who were the proper party to the agreement and then whether Hong Kong is the natural and appropriate forum to try the dispute arising from this agreement.

Parties to the Agreement

11.The question here is whether the parties to the agreement are clearly stated. If so, then I do not have to look any further since if the parties have properly contracted in Hong Kong, the most natural and appropriate forum to determine the dispute must be in Hong Kong.

12.To answer that question, I must look back at that quotation dated 26^th October 2007. If that is clear on the face of it, then there is no need to look at any other extrinsic evidence, even, as I am told by Mr. Anthony Chan for the Plaintiff that I am permitted in law to do so in this case. I am of the view, however, if the document on the face of it is clear, I should then rely on the document itself and should not look any further.

13.The parties contracting were stated to be California Fitness who signed as a buyer and it was signed by its authorized signatory and Olivia Wong signed as the authorized signature for and on behalf of the Plaintiff. I have been referred to the Annual Return of the Defendant whose company name was JV Fitness Ltd and its business name was California Fitness Centres with its registered office at Room 92, The Lee Gardens, 33 Hysan Avenue, Causeway Bay, Hong Kong, which was the address written on the said quotation. The price was clearly written thereat. Further, in that quotation, it stipulated the delivery of materials from Germany to Singapore upon confirmation with the address of 230, Victoria Street, #01-01A, Bugis Junction Tower, Singapore 188024 with payment of 50% deposit before production and balance 50% before delivery.

14.Standing back and looking at this quotation objectively (and not to be diverted and confused by any other subsequent claims and counterclaims, allegations and counter-allegations between the parties after 26^th October 2007), am I satisfied that the parties have entered into a contractual agreement herein. My answer must be in the positive. It is said that the name of the Defendant is unclear. I do not think so. There is only one California Fitness in the territory as far as I know. The parties must have intended the wordings to mean the Defendant. The address was the right one. The subject matter was the ones agreed by both parties and the price and delivery and payment method was agreed. It is now claimed that the Defendant JV Hong Kong was only acting for and on behalf of JV Singapore as its agent since there is one regional headquarter dealing with these legal, administrative and contractual matters. However, at the time there was no such qualification when the authorized person of the Defendant signed this quotation. On the face of the quotation, the Defendant was signing in its own capacity. Thus, the Defendant is deemed to be the party contracting in its own capacity, see Wo Shing & Anor. V Man Kwok Leung (unreported) DCCJ 4080 of 2005 at 14^th September 2007 per HH Judge Mimmie Chan.

15.It is also said that in this quotation there was the installation charge of floor screeding whereas in the subsequent deposit invoice sent to JV Singapore, this item did not appear. No doubt the non-appearance of this item may well be the subject of the dispute at trial as to the responsibility of the defective works if any. At the time of this quotation, I have no hesitation to come to a conclusion that the parties have intended and did enter into a binding contractual relationship and those parties were the Plaintiff and JV Hong Kong.

16.In deference to the excellent and concise submissions of Mr. Jonathan Wong for the Defendant, I have not overlooked the fact that all subsequent invoices and reminders were sent to JV Singapore as well as a point taken that the Plaintiff s proceedings in Hong Kong was not bona fide since they commenced a day after they got notice of the commencement of proceedings in Singapore due to the service of those proceedings.

17.In dealing with the latter point first, Mr. Wong s point would have more force had it not been a number of previous correspondences between legal representatives arguing over this repeatedly. To me, it is really a matter of who pulled the trigger first and it so happened that the Singaporean proceedings commenced first with reaction by the Plaintiff initiating the Hong Kong proceedings. Each party still maintaining their position steadfastly and proceeded accordingly. I am of the view that nothing sinister can be or should be read into it.

18.In relation to the first point, I am of the view that these are really matters after the event of the quotation on 26^th October 2007. Each party would have their own explanations. If it were to look at all matters subsequent to that crucial event, I also need to take into account that JV Hong Kong paid the Plaintiff through the Hong Kong accounts in the first place. Then I have to take into account the reasons advanced by the JV Hong Kong representatives as to why that was the case. Thus, I have to enter into endless enquiries which may well confuse the issues. It is with some wisdom that parol evidence rule exists and I intend to adhere to such a rule in order to come to a view in certainty.

The natural and appropriate forum

19.If I were wrong on the first issue, then I proceed to consider the natural and appropriate forum for this action.

20.The law is also settled in this regard. The case of Spiliada Maritime Corp v Cansulex Ltd. [1987] AC 460 is followed in Hong Kong in Adhiguna Meranti [1987] HKLR 904. The law and procedure is further summarized in Rambas Marketing Co. LLC. V Chow Kam Fai David [2001] 3 HKC per Recorder Geoffrey Ma SC (as he then was). I only need to refer to the headnotes in that case for the summary :

For a stay of an action on the basis of forum non conveniens, it must first be shown that Hong Kong was not only not the natural or appropriate forum for the trial, but that there was another available forum which was clearly or distinctly more appropriate than Hong Kong. The evidential burden rested upon the applicant. The emphasis was upon appropriate rather than convenient . Failure by the applicant at this stage would normally be fatal. The next question was whether a trial at this other forum would deprive the plaintiff of any legitimate personal or judicial advantages; and lastly, the court would balance the advantages and disadvantages and consider if it was satisfied in the overall circumstances and justice of the case that a stay should be granted.

21.Can it be shown that Hong Kong was not only not the natural or appropriate forum for the resolution of this dispute and that there was another available forum the Singapore court which was clearly or distinctly more appropriate than Hong Kong? The burden is on the Defendant.

22.The dispute in essence concerns defective workmanship or whose responsibility it was that caused such defects. Without going to the merits of the case, the crucial question must be what was done, or in this case what was not done. I have before me a detailed surveyor s report engaged by the Defendant in Singapore. I also have the Plaintiff s report which said that they were shocked by the flooring condition of the premises. There was no proper screeding on the concrete flooring which made their task very difficult. Thus, the dispute is simply what went wrong and whose fault it was.

23.It is right the performance of this agreement was in Singapore. However, it seems the Defendant had completed a surveyor s report, there is no question of needing the inspection of the Bugis Club or calling any other persons save and except the surveyor and one of the supervising staff. There is one Mr. Washbourne whose present whereabouts apparently is unknown. If he is an expatriate, he may still remain unavailable be it Singapore or Hong Kong. His evidence really concerns what was said and done. But if he is not available at the moment, as he has left the employment of JV Singapore, he will not be available anyway. Thus, he can be left out of the equation. In any event, most of his input can be gleaned from the emails passed between the parties.

24.There are three other witnesses Mr. Wilson Koh, Mr. Hakim and Ms. Abdullah for the Defendant, but I do not think that all of their testimonies are required since they were all the supervising staff only. There is need for only one to prove or counter the allegations of the floor conditions. On the Plaintiff s side, all the witnesses including the installation workers are based in Hong Kong and resides here.

25.Thus, on the whole, I fail to see that Singapore is clearly and distinctly more natural and appropriate forum, or put it in another way equally, that Hong Kong is not the natural or appropriate forum for the resolution of this dispute. As a result, the Defendant fails under this hurdle and consequently it fails in the application.

26.Even if I was wrong on that, I would still have come to the conclusion looking at the other two questions in the test that I should not grant a stay in all the circumstances of this case, as there is really no difference in both the jurisdictions and the justice of the case is not compromised by choosing the Hong Kong jurisdiction.

27.That being the case, I refuse the Defendant s application to stay and therefore dismiss it. Costs follow the event and I award costs to the Plaintiff with certificate for counsel. Needless to say, I thank both counsel for their concise, excellent and persuasive submissions.

The Plaintiff : represented by Mr. Anthony K H Chan instructed by Messrs. Wong, Hui & Co. , Solicitors.

The Defendant : represented by Mr. Jonathan Wong of Messrs. Deacons, Solicitors.