Chan Cham Pong Cedric v Too Ka Man And Another

DCCJ 1463 / 2017

[2019] HKDC 971

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 1463 OF 2017

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JUDGMENT

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Introduction

1. This is a breach of contract action. It arose out of a renovation project for an apartment in a private residential development known as The Merton (泓都) in Kennedy Town, Hong Kong (“the Apartment”).

2. The Apartment was located within a building which was only completed in 2004. The Plaintiff (“P”) bought it on 8 April 2006 (the date of the sale and purchase agreement) at a consideration of HKD 3,100,000, after which he started living there with his wife (“Ms Tam”) and their cat. Given the general trend of the property market in Hong Kong since 2006, the value of the Apartment should have increased substantially since then.

3. Having lived in the Apartment for close to 10 years, P entered into a written renovation contract with reference number MT-04042016-1 with the 2^nd Defendant (“D2”) on 4 April 2016 so as to get the Apartment substantially renovated (“the Original Contract”).

4. Disputes soon arose out of the Original Contract, which led to the creation of yet another written contract between P and D2 dated 22 July 2016 (“the New Contract”).

5. Disputes then arose out of the New Contract. Those disputes eventually led to the commencement of this action on 22 March 2017.

6. By the written opening lodged by P shortly before the start of the trial on 8 April 2019, P abandoned his claims against the 1^st Defendant (“D1”), who was just a shareholder and director of D2, but maintained his claims against D2.

7. The main issues in dispute were: -

(1) Whether disputes between P and D2 arising out of the Original Contract had been settled by the New Contract so that P could no longer sue on the Original Contract (“Issue 1”);

(2) If so, whether P or D2 had acted in breach of the New Contract, or if not, whether P or D2 had acted in breach of either of the two contracts (“Issue 2”);

(3) Whether P or D2 suffered loss as a result thereof and if so, what should be the quantum of damages recoverable (“Issue 3”); and

(4) Given P’s 11^th hour abandonment of his pleaded claims against D1, and my judgment on Issues 1, 2 & 3 above, what would be the most appropriate costs orders in this matter (“Issue 4”).

(Collectively, “the Issues in Dispute”)

8. The trial took 6 days. The following people gave evidence:

(1) P;

(2) Ms Tam;

(3) D1;

(4) P’s expert Mr Lee Kwok Chuen (“P’s Expert”); and

(5) D2’s expert Mr Yung Chi Kin Boris (“D2’s Expert”).

9. A 6^th person, Ms Fung Ka Lai Winnie (“Ms Fung”), who was the wife of D1 and a shareholder of D2, made and filed a witness statement but did not give evidence. On P’s application, with D1 & D2 (collectively, “Ds”) not opposing, Ms Fung’s witness statement was expunged.

10. On the last day of trial, after hearing closing submissions from (1) Mr Ernest Wong, Counsel for Ds and (2) Ms Elaine Liu, Counsel for P, I reserved my judgment and indicated I would hand down my judgment in writing, which I hereby do.

11. I shall start by setting out my general and overall observations on the evidence of each of the witnesses, and then move on to analyze the Issues in Dispute one by one, before setting out my disposition.

The Evidence of P (the 1^st Witness)

12. P gave evidence first. He struck me as an honest person who gave evidence in a fair manner. In so far as factual matters within his own knowledge are concerned I accept his evidence as true and accurate. I shall elaborate on this at appropriate places hereinbelow.

13. In gist, P said D2 acted in breach of both the Original Contract and the New Contract in that D2 did not in fact complete the renovation of the Apartment. P said the work of D2 was of low quality, that D2 refused to pay agreed compensation, and that as a result of D2’s breach of contract, P suffered loss and damage, which P particularized.

The Evidence of Ms Tam (the 2^nd Witness)

14. Ms Tam gave evidence next. She also struck me as an honest person who gave evidence in a fair manner. She was a housewife and she dealt with the day-to-day liaison work vis-à-vis Ds whilst P was at work. In so far as factual matters within her own knowledge are concerned I also accept her evidence as true and accurate. I shall elaborate on this at appropriate places hereinbelow.

The Evidence of D1 (the 3^rd Witness)

15. The 3^rd witness was D1. He struck me as a dishonest, evasive, recklessly irresponsible and wholly unreliable witness. I find the following non-exhaustive features in D1’s evidence wholly unacceptable: -

(1) D1’s witness statement, dated 13 December 2017, was professionally prepared with the assistance of lawyers. D1 signed a statement of truth verifying its contents as true. During D1’s examination-in-chief, D1 corrected just one word in this witness statement and confirmed the rest of its contents as true. When cross-examined, however, D1 changed his evidence and said 8 out of 32 paragraphs of this witness statement were wrong. Of all these “inaccuracies”, the most serious one was D1’s false allegation that P had refused to grant Ds access to the Apartment. That allegation was obviously false and flatly contradicted by the contemporaneous WhatsApp conversations which P produced. Since D1 was himself a party to those WhatsApp conversations, and had a full opportunity to read them again before giving evidence, in my judgment D1 had given false evidence knowing the same to be false or at least not caring about its truth or falsity when he confirmed the contents of his witness statement as true without correcting this first.

(2) D1 was shown the list of documents signed and filed by Ds’ lawyers on Ds’ behalf in August 2017, where only 9 items were disclosed by them in its Schedule 1 Part 1 as documents relevant to the issues in this action in the Peruvian Guano sense. D1 was then asked why Ds had, via this list, declared that Ds did not have and never had in their possession, custody or power other obviously relevant documents such as copies of email messages, WhatsApp messages, other correspondence with the Consumer Council, etc., which Ds obviously had. D1 was also asked whether this was an attempt on Ds’ part to deliberately withhold and hide evidence perceived by Ds as adverse to their best interests in this case and to “blindfold” this Court into not seeing the whole picture. D1 alleged he had handed everything to his lawyers and never withheld anything. In effect, D1 was alleging it was his lawyers’ fault. To put this in context, save for a short period of time between 9 November 2018 and 3 December 2018, Ds were all along legally represented and Ds’ list of documents was professionally prepared by one team of lawyers (in August 2017) and reviewed by a second team of lawyers (after 3 December 2018). In my judgment, it would be unlikely for separate teams of lawyers to have jointly and/or successively withheld documents from this Court, knowing the same had been handed over by Ds to them. On balance of probabilities, the more likely scenario must be that Ds never gave the other relevant documents to their lawyers, and that D1 was giving false evidence knowing the same to be false when he alleged he gave everything to his lawyers.

16. By reason of the above, and as I shall elaborate at appropriate places below, in so far as D1’s evidence is self-serving or contradicted, I reject the same as false or unreliable.

The Evidence of P’s Expert (the 4^th Witness)

17. The 4^th witness was P’s Expert. He struck me as a fair expert who was most knowledgeable in the field of home renovation and assisted me independently in the most helpful way possible. As I shall elaborate at appropriate places below, I accept most parts of his opinion as reliable and correct.

The Evidence of D2’s Expert (the 5^th & Last Witness)

18. D2’s Expert gave evidence last. In my judgment, he failed to discharge his duty to give his opinion impartially. By way of examples: -

(1) Under skillful cross-examination by P’s Counsel, D2’s Expert revealed that he based some of his opinions (for example his view that some doors within the Apartment were meant to come with “magnetic catches” so that handles would never be required) on some private and previously-undisclosed conversations between Ds and himself, instead of on disclosed witness statements and evidence actually adduced in Court.

(2) He gave false factual evidence that Ds were “evicted” from the Apartment by P, when he had no proper basis to say so, and when it was not his role to give evidence on the alleged “eviction”.

(3) When cross-examined, D2’s Expert was argumentative and evasive throughout. In fact, Ms Liu, Counsel for P, was repeatedly forced to repeat her questions since D2’s Expert kept trying to say what he would himself like to say, as opposed to just answering questions directly.

19. By reason of the above, and as I shall elaborate at appropriate places below, his opinion is largely rejected by me as unreliable.

Issue 1 – Effect of the New Contract

20. Issue 1 can be disposed of fairly quickly as the parties agreed its resolution, one way or the other, should have no effect on the assessment of quantum.

21. In gist, I agree with Mr Wong, Counsel for Ds, that the legal effect of the New Contract was to create “a clean plate” so that P could no longer sue on the Original...