NGAI HING HONG PLASTIC MATERIALS LTD v. KADER INDUSTRIAL CO LTD

NGAI HING HONG PLASTIC MATERIALS LTD v. KADER INDUSTRIAL CO LTD

On the balance of probabilities the Court found Moplen EP-332K and Profax 7533 to be the same resin (re-branding/packaging difference) and that plaintiff failed to prove any material defect or breach of the implied terms; HKPC elongation-at-break results were unreliable due to flawed mould temperature control and elongation-at-break is an inherently variable metric; plaintiff's hearsay production evidence lacked sufficient weight. Therefore Kader's claims dismissed; NHH's counterclaim succeeded and judgment entered in NHH's favour.

Citation
NGAI HING HONG PLASTIC MATERIALS LTD v. KADER INDUSTRIAL CO LTD
Parties
Plaintiff (hca 1534); Defendant (counterclaim in HCA 1709): Kader Industrial Company Limited; Defendant (hca 1534); Plaintiff (hca 1709): Ngai Hing Hong Plastic Materials Limited; Third Party: Million Supply Limited trading as Wah Cheong Hong; Fourth Party: Luen Fung Hong Plastic Materials Company Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
30 March 2007
Case Number
HCA1709/2003
Procedural Posture
Contract Dispute Sale of Goods (polypropylene Resins) / Judgment at Trial (court of First Instance)
Outcome
Kader Industrial Company Limited's claims dismissed; Ngai Hing Hong Plastic Materials Limited's counterclaim allowed; judgment for NHH on second action; third and fourth party proceedings dismissed
Legal Topics
Implied Terms, Sale by Sample, Merchantability, Fitness for Purpose, Hearsay Admissibility, Damages, Set Off, Third/fourth Party Indemnity
Source Language
EN
Contract Sale of Goods Evidence Misrepresentation Implied Terms Sale by Sample Merchantability Fitness for Purpose +4 more

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Parties

Kader Industrial Company Limited

Plaintiff (hca 1534); Defendant (counterclaim in HCA 1709)

Ngai Hing Hong Plastic Materials Limited

Defendant (hca 1534); Plaintiff (hca 1709)

Million Supply Limited trading as Wah Cheong Hong

Third Party

Luen Fung Hong Plastic Materials Company Limited

Fourth Party

Procedural Posture

Contract Dispute Sale of Goods (polypropylene Resins) / Judgment at Trial (court of First Instance)

Legal Issues

  1. 1 Whether seller breached implied condition that bulk correspond with sample (Sale of Goods Ordinance s17(2)) by supplying Profax 7533 instead of Moplen EP-332K
  2. 2 Whether seller breached implied condition that goods be free from undiscoverable defects rendering them unmerchantable (s17(2)(c))
  3. 3 Whether an implied term as to fitness for a particular purpose arose (s16(3)) and was breached

Ratio Decidendi

On the balance of probabilities the Court found Moplen EP-332K and Profax 7533 to be the same resin (re-branding/packaging difference) and that plaintiff failed to prove any material defect or breach of the implied terms; HKPC elongation-at-break results were unreliable due to flawed mould temperature control and elongation-at-break is an inherently variable metric; plaintiff's hearsay production evidence lacked sufficient weight. Therefore Kader's claims dismissed; NHH's counterclaim succeeded and judgment entered in NHH's favour.

Court Disposition

Kader Industrial Company Limited's claims dismissed; Ngai Hing Hong Plastic Materials Limited's counterclaim allowed; judgment for NHH on second action; third and fourth party proceedings dismissed

Orders

  • Judgment for NHH on counterclaim; interest at 1% above HSBC prime from invoice dates until judgment and thereafter at judgment rate
  • Judgment for NHH in HCA 1709/2003 for HK$619,127.50 with interest at 1% above HSBC prime from invoice dates until judgment and thereafter at judgment rate