TREASURE EXPRESS INDUSTRIAL LTD v. DRAGON WORKSHOP LTD AND ANOTHER

TREASURE EXPRESS INDUSTRIAL LTD v. DRAGON WORKSHOP LTD AND ANOTHER

Tenant breached Clause 16 by conditioning execution of transfer forms on full refund; breach date found to be 10 August 2017; but-for the breach the transfers would likely have proceeded and Fresh applications, additional consultancy costs of HK$63,000 and apportioned renovation cost of HK$9,000 were caused by the breach; total loss HK$72,000 deductible from retained deposit of HK$40,144.73 leaving Tenant and Lai liable to pay HK$31,855.27; counterclaim dismissed; costs order nisi that Tenant pay 85% of costs to be taxed on Small Claims Tribunal scale; pre-judgment interest at 1% above prime from writ date and judgment interest at statutory rate.

Citation
[2022] HKDC 839
Parties
1st Plaintiff (landlord): Dragon Workshop Limited; 2nd Plaintiff (landlord): Huge Target Limited; 1st Defendant and Plaintiff (tenant): Treasure Express Industrial Limited; 2nd Defendant (guarantor/director): Lai Yu San
Court
District Court
Jurisdiction
Hong Kong
Judgment Date
16 August 2022
Case Number
DCCJ4006/2018
Procedural Posture
Consolidated Civil Actions: Landlord and Tenant Dispute (dccj 2497/2018 & DCCJ 4006/2018) / Final Judgment After Trial (judgment Dated 16 August 2022)
Outcome
Judgment for the landlords in part; counterclaim dismissed
Legal Topics
Breach of Lease, Assignment/transfer of Licences, Deposit Retention, Causation and Damages, Costs and Jurisdictional Propriety
Source Language
EN
Landlord and Tenant Contract Property Law Administrative/licensing Law Breach of Lease Assignment/transfer of Licences Deposit Retention Causation and Damages +1 more

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Parties

Dragon Workshop Limited

1st Plaintiff (landlord)

Huge Target Limited

2nd Plaintiff (landlord)

Treasure Express Industrial Limited

1st Defendant and Plaintiff (tenant)

Lai Yu San

2nd Defendant (guarantor/director)

Procedural Posture

Consolidated Civil Actions: Landlord and Tenant Dispute (dccj 2497/2018 & DCCJ 4006/2018) / Final Judgment After Trial (judgment Dated 16 August 2022)

Legal Issues

  1. 1 Whether Tenant breached Clause 16 by refusing to assist re-transfer of FEHD licences
  2. 2 Whether consultancy fee (HK$78,000) and renovation fee (HK$35,000) were caused by Tenant's breach
  3. 3 Whether Landlords breached implied duty to cooperate in licence re-transfer

Ratio Decidendi

Tenant breached Clause 16 by conditioning execution of transfer forms on full refund; breach date found to be 10 August 2017; but-for the breach the transfers would likely have proceeded and Fresh applications, additional consultancy costs of HK$63,000 and apportioned renovation cost of HK$9,000 were caused by the breach; total loss HK$72,000 deductible from retained deposit of HK$40,144.73 leaving Tenant and Lai liable to pay HK$31,855.27; counterclaim dismissed; costs order nisi that Tenant pay 85% of costs to be taxed on Small Claims Tribunal scale; pre-judgment interest at 1% above prime from writ date and judgment interest at statutory rate.

Court Disposition

Judgment for the landlords in part; counterclaim dismissed

Orders

  • 1st and 2nd defendants (Treasure Express Industrial Limited and Lai Yu San) to pay 1st and 2nd plaintiffs (Dragon Workshop Limited and Huge Target Limited) HK$31,855.27
  • Pre-judgment interest at 1% above prime rate to accrue from date of the Writ of Summons in DCCJ No 2497 of 2018