GRAND CHOICE CONSTRUCTION CO. LTD. v. DILLINGHAM CONSTRUCTION (H.K.) LTD.

HCCT000013/1989

Construction List No. 13 of 1989

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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BETWEEN

GRAND CHOICE CONSTRUCTION CO. LTD.

Plaintiff

AND

DILLINGHAM CONSTRUCTION (H.K.)LTD

Defendant

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Coram: The Hon. Mr. Justice Kaplan in Chambers

Date of Hearing: 18th December 1991

Date of Handing Down Judgment: 7th January 1992

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JUDGMENT ON COSTS

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1. I gave judgment in favour of the plaintiff in the sum of $498,765.39 in my supplementary judgment dated 11th December 1991.

2. On 18th December, I awarded interest on that sum from 28th July 1988 until 31st October 1991 at 2 1/2% above the prime rate. I amconfident that the parties will be able to agree the figure as they have already agreed the appropriate prime rate during the appropriateperiod.

3. On the same day, I heard counsel the question of costs. I was told that on the 4th April 1990, the defendant paid into court thesum of $1m. This was topped up by a further $300,000.00 on the 11th October 1990.

4. Mr. Bell submits that Grand Choice should have the costs of the action up to the 4th April 1990 and that thereafter Dillingham shouldhave the costs.

5. Mr. Lewis put forward some arguments as to why the normal order should not be made. He relied heavily on the fact that neither aset off nor a counterclaim had been pleaded. He complained that the backcharges bundle was not put in until the hearing had commencedand then much of it had to be translated.

6. However, the simple fact of the matter is that Dillingham had always made it clear that they had backcharges to claim which wereto be set against Grand Choice’s claim. In fact, Grand Choice plead the arrangement whereby Dillingham was to pay for certain itemsand recover the costs later. This was all done to assist Grand Choice’s cash flow.

7. Some of these items are properly set out in Grand Choice’s statement of claim. In their defence, Dillingham add certain other itemsabout which there were disputes which I have had to resolve Mr. Ho of Grand choice admitted that he had been given the backchargesdocuments long before the trial. Grand Choice was giving credit for $752,000.00 in respect of backcharges and Dillingham was contendingfor the larger sum of $2.1m.

8. I cannot think that Mr. Lewis is correct when he submits that Grand Choice were entitled to ignore the backcharges until the 17thMay 1991 when certain amendments were made to the defence. Grand Choice were well aware of the case that they had to meet becausethey conceded that they had to give credit – what was in issue was the amount.

9. Although it is unfortunate for Grand Choice that they did not beat the first payment into court, I cannot find any reason why I shouldnot apply the normal consequences of such failure.

10. I, therefore, order that Grand Choice do have the costs of the action up to and including the 4th April 1990. Dillingham will havethe costs thereafter. These costs will be taxed if they cannot be agreed.

11. I will also make an order that there shall be payment out of the moneys in court to Grand Choice’s solicitors in the sum of $498,765.39(together with such sum as the parties may agree or the court orders for interest) in satisfaction of the plaintiff’s judgment herein.There shall be payment out of the balance of the moneys held in court to the defendant’s solicitors. There will be no order as tocosts in relation to the hearings on 11th and 18th December 1991.

(Neil Kaplan)
Judge of the High Court

Representation:

Appearance

Kevin Lewis instructed by Denton Hall Burgin & Warrens for the Plaintiff.

Adrian Bell instructed by Masons for the Defendant.