Civil Action1980

KOMALA DECCOF & CO. S.A. AND OTHERS v. PERUSAHAAN PERTAMBANGAN MINYIK DAN GAS BUMI NEGARA (PERTAMINA)

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CACV153/1982KOMALA DECCOF AND CO SA AND OTHERS v. PERUSAHAAN PERTAMBANGAN MINYAK DAN GAS BUMI NEGARA (PERTAMINA)
CACV167/1986KOMALA DECCOF & CO SA AND OTHERS v. PERUSAHAAN PERTAMBANGAN MINYAK DAN GAS BUMI NEGARA (PERTAMINA)
CACV80/1985COLLIN NAVIGATION CO. S.A. v. PERUSAHAAN PERTAMBANGAN MINYAK DAN GAS BUMI NEGARA (PERTAMINA)

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27803-EN-1986-12-05

KOMALA DECCOF AND CO. S.A. AND OTHERS v. PERUSAHAAN PERTAMBANGAN MINYAK DAN GAS BUMI NEGARA (PERTAMINA)

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HCA000960B/1980

1980, No. 960

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

____________

BETWEEN

	KOMALA DECCOF & CO. S. A.	1st Plaintiff
	COLLIN NAVIGATION CO. S. A.	2nd Plaintiff
	KOMALA DECCOF & CO. (a firm)	3rd Plaintiff

	and

	PERUSAHAAN PERTAMBANGAN HINYAK DAN GAS BUMI NEGARA (PERTANINA)	Defendant

__________________

Coram: Hon. Jones J. in Chambers

Dates of hearing: 24th, 25th & 26th November 1986

Date of delivery of judgment: 5th December 1986

___________

JUDGMENT

___________

1. This is an application by the 2nd plaintiff, Collin Navigation Co. S. A. to re-re-amend the statement of claim.

2. The history of the case dates back to the lst July 1971 when an agreement was entered into between the 2nd plaintiff and the defendant for the construction and sale of two ocean going tugboats for a total price of US$1,994,500. Another agreement to build two other tugboats was also made on the same date and this agreement was completed although delivery was late. It is common ground that there have been considerable commercial dealings between the parties from about 1969 until about 1976. Substantial sales took place during this period including such items as steel bars, machinery, cement and the charter of ships. For the purposes of this application it is necessary for me to refer to three of the clauses in the agreement. Clause 3 provides for the tugboats to be delivered on a mutually agreed date, not earlier than 6 months and not later than 9 months, but it was also provided that the period could be extended by reason of delay for certain causes. Indeed, an extension was granted for the delivery in this case. By clause 4 the purchase price was to be paid in cash not later than 6 months after `delivery. Finally, clause 7 of the agreement has featured prominently for it contains the provision for the purchasers obligation to pay additional expenses, so I shall set it out in full: -

" Clause 7

This Irrevocable Contract is effective as from the day of signing of this Contract until the completion of payment. The Purchasers will continue to undertake full responsibility under any circumstances, and to fulfill this Irrevocable Contract, and to guarantee full payment not later than six months, and take delivery of the two (2) Tug-boats in Djakarta immediately after receipt of Supplier's notice of readiness. Meanwhile, the Purchasers will also undertake full responsibility for any additional expenses incurred due to Purchasers delay in taking delivery of the two (2) Tug-boats after the notice of readiness has been served. "

The agreement was later varied for the tugboats to be constructed in Taiwan together with the provision of extra equipment.

3. A notice of readiness was sent by the 2nd plaintiff to the defendant on the 28th September 1972 which included a request for payment and delivery instructions. On the 14th January 1973, the 2nd plaintiff requested instructions for the names to be given to the tugboats and again for delivery instructions. Subsequently three reminders were sent by the 2nd plaintiff, but no reply was received. Eventually, on the 13th June 1975, the defendant asked the 2nd plaintiff to name the tugboats, "Nuti" and "Nita". The 2nd plaintiff acknowledged these instructions and made another request for payment. However, there was no response from the defendant nor to seven reminders sent between September 1975 and December 1979.

4. On the 30th May 1978, the 2nd plaintiff informed the defendant that their running account amounted to US$4,366,102.08 which sum included the purchase price of the two tugboats "Nuti" and "Nita". The defendant did not reply to this letter nor to reminders that were sent later.

5. After the writ was issued on the 26th February 1980, there were some without prejudice communications between the parties, but they achieved no positive result. The tugboats were sold by the 2nd plaintiff on the 29th December 1981 for the sum of US$2.45 million which was more than the contract price. By so doing the 2nd plaintiff finally accepted the defendant's repudiation of the contract.

6. In the endorsement on the writ, there are separate claims by each of the three plaintiffs against the defendant for the price of goods sold and delivered and in respect of other claims. Under paragraph 2, the 2nd plaintiff claims sums incurred by way of demurrage expenses, charter hire and damages for failure to take delivery of two tugboats. Particulars of the claim for the tugboats were set out in paragraph 2C which recites details of the contract and claims payment of the purchase price on the grounds that the property had passed to the defendant. In the event that the property had not passed the 2nd plaintiff claimed in the alternative, damages for breach of contract. On an application by the defendant on the 4th July 1982, Bewley J. struck out paragraph 2C from the endorsement. The 2nd plaintiff did not resist nor consent to this application. The particulars were struck out on the grounds that the claim was time barred under the Limitation Ordinance Cap. 347. In the judgment of the Court of Appeal given on the 7th February 1986⁽¹⁾, to which I shall refer later, Kempster J.A. described the order as midway between a default and a consent order.

7. The statement of claim which was served on the 2nd July 1982 contains no reference to the tugboats.

8. On the 18th November 1982, summary judgment under 0.14 was entered in favour of the plaintiffs for part of the claim in the sum of US$1,164,225 with interest. This judgment given by Mayo J. was subsequently subject to an appeal by the plaintiffs on the matter of interest.

9. On the 17th February 1984, the 2nd plaintiff obtained leave from Master Clay under 0.11 of the Rules of the Supreme Court to issue a writ in a fresh action to be served out of the jurisdiction in which a claim was made for damages and expenses incurred as a result of the delay caused by the defendant in failing to take delivery of the tugboats. The order for leave was set aside on appeal by the defendant on the 29th April 1985 by Mayo J. on the grounds that the claim was res judicata. The 2nd plaintiff's appeal against this decision was dismissed on the 7th February 1986 when the Court of Appeal held that the action was vexatious. Although the 2nd plaintiff obtained leave to make further submissions, the Court affirmed its decision on the 30th July 1986.

10. In considering the particulars of the endorsement set out in paragraph 2C, Kempster J.A. had this to say in his judgment at page 4⁽¹⁾ :-

"Particulars C 'primarily" constituted a claim for the price pursuant to sections 51(1) and 20, Rule 5(1), of the Sale of Goods Ordinance (Cap. 26), though damages for non-acceptance pursuant to section 52 were claimed in the alternative, while the substantive words were reasonably apt to embrace claims for damages for neglecting to take delivery within the parameters of clause 7 on the basis of repudiation and also under section 39 of the Ordinance without so alleging. "

Later in the judgment, Kempster J.A. made reference to the fact that although the particulars in 2C had been struck out, the endorsement still included a claim for damages for failure to take delivery and for damages for breach of contract with the result that the 2nd plaintiff should be permitted to include the claim in the re-amended statement of claim in the present action. Mr. Newman, counsel. for the 2nd plaintiff submitted that the Court of Appeal was suggesting that this was the correct procedure to adopt for the inclusion of this claim. The Court of Appeal declined to rule whether the cause of action that had been pleaded in the second action was doomed to failure either because it had been abandoned in the first or that it was barred by the Limitation Ordinance, or whether in keeping the contract alive the 2nd plaintiff was in breach of duty to mitigate any continuing loss.

11. It is conceded by the 2nd plaintiff that if the claim would be time barred in a new action, the Court has no jurisdiction to grant the amendments.

12. However, the thrust of the 2nd plaintiff's application is based upon Clause 7 of the contract and section 39 of the Sale of Goods Ordinance which concerns the liability of a buyer for neglecting or refusing to take delivery of goods. Whilst it is accepted that the 2nd plaintiff are precluded from claiming damages for non-acceptance, there is no bar for the additional expenses incurred by reason of the defendant's delay in taking delivery of the tugboats. Accordingly, the 2nd plaintiff maintains that the effect of the proposed amendment is to add the particulars of the claim which arise out of the same facts or substantially the same facts that have already been pleaded in the endorsement. It is therefore contended that the claim made for these additional expenses amounts to a debt and gives rise to a cause of action from the dates when the expenses were incurred.

13. Mr. Newman said that in order to determine whether the particulars arise out of the same facts or substantially the same facts, the court is entitled to look at the re-amended statement of claim with the proposed re-re-amended statement of claim and to the endorsement on the writ. On the other hand, Mr. Phillips, counsel for the defendant submitted that the court is not permitted to consider the endorsement on the writ, but only to compare the re-amended statement of claim with the amendments that are now sought to be made. He cited in support of his argument Steamship Mutual Underwriting Association Ltd. & Another v. Trollope & Colls (City) Limited⁽²⁾, a decision of the Court of Appeal in England as authority for his proposition that the statement of claim is to be regarded as paramount.

14. Mr. Phillips also placed reliance upon a passage in volume 1 of the Supreme Court Practice 1985 18/15/1 which reads : "A claim in the writ not repeated in the statement of claim is treated as abandoned". Reference is then made to two cases Cargill v. Bower⁽³⁾ and Lewis v, Durnford⁽⁴⁾. Mr. Phillips conceded that Cargill v. Bower⁽³⁾ is not an authority, for this proposition as it was concerned with an election between two inconsistent remedies which resulted in an abandonment of the one which was not elected. However, he asserted that the second case supported his argument for Swinfen Eady J. held that a claim endorsed on a writ was superseded by the statement of claim. Accordingly, where a plaintiff in his statement of claim omitted part of the claim, he is deemed to have abandoned that part. I was also referred to Harries v. Ashford⁽⁵⁾ where the Court of Appeal applied Cargill v. Bower⁽³⁾ and Lewis v. Durnford⁽⁴⁾. However, in Clemence v. Daniel⁽⁶⁾, Danckwerts, J. gave leave to amend, by including an alternative claim for specific performance of a contract that had been included in the writ but not in the statement of claim. He held that the dicta of Asquith L.J. in Harries v. Ashford⁽⁵⁾ to the effect that the court had no power to grant leave to amend a statement of claim by including a claim made in the writ were obiter and not supported by the authorities referred to in that case.

15. May L.J. in the Steamship Mutual⁽²⁾ case expressed doubt as to whether there is any legal basis for deciding that there had been abandonment in the circumstances referred to by Swinfen Eady J. in Lewis v. Durnford⁽⁴⁾. In the course of his judgment as to whether a statement of claim should be amended, he had this to say at page 27 :-

"When a plaintiff seeks leave to serve a re-amended statement of claim, and one has to consider and contrast it with the earlier amended statement of claim for the purposes, for instance, of section 35 of the Limitation Act 1980, one realistically looks at the two statements of claim. One does not look truly to the endorsement on the writ - in which the plaintiff by Ord.6, r.2(1)(a) need not “plead" any cause of action at all (if "plead" is the correct word). In passing, it is difficult to reconcile that particular sub-rule with the provisions of Ord.18, r.15(2). But nevertheless, when one looks at the two statements of claim - the amended and re-amended statement of claim in this litigation - adopting what I trust is a reasonably and sensible approach, remembering the definition of the cause of action in, for instance, Letang's case, it seems to me as clear as it was to the learned judge that, in the action constituted by the writ and re-amended statement of claim, the plaintiff was seeking to enforce a new claim, that is to say one which involved the addition of a new cause of action, that is to say the one which related to the brickwork. "

Later in his judgment, May L.J. said that after service of the writ, but before service of the statement of claim, the endorsement on the writ identified the cause or causes of action.

16. In Letang v. Cooper⁽⁷⁾, Diplock L.J. as he then was, defined a cause of action thus :-

"A cause of action is simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person. "

17. In an earlier case, Batting v. London Passenger Transport Board⁽⁸⁾ the Court of Appeal did consider the endorsement on the writ when deciding whether or not to grant an order to amend the statement of claim.

18. In my judgment it is unrealistic to ignore the endorsement on the writ and to have regard only to the statement of claim as being paramount. Although no explanation has been given for the failure to include the claim in the statement of claim it may-well have been attributable to a mistake or to an error of judgment. It does seem with the words retained in the endorsement that the full implication of the striking out was not properly appreciated at the time. The authorities cited by Mr. Phillips and the passage quoted from the Supreme Court Practice do not therefore in my opinion support his argument. I consider that neither the statement of claim nor the endorsement should be treated as paramount, but should be looked at together. Accordingly I am satisfied that the amendments sought to be made relate to the particulars arising from the same facts that are contained in the endorsement.

19. Accordingly it is now necessary for me to consider whether I should exercise my discretion by allowing the amendments. Mr. Phillips submitted that the defendant has been lulled into believing that the 2nd plaintiff by its conduct has abandoned the claim by its failure to contest the application to strike out and by the omission to include any reference to the tugboats in the statement of claim.

20. There has been no express abandonment of the claim which arose in Woomera Company Limited and Another v. Provident Centre Development Limited⁽⁹⁾, where counsel specifically abandoned a claim for common law damages. But despite that abandonment the Court in its discretion allowed the defendant to restore the claim by an amendment.

21. My attention was drawn to Excomm Ltd. v. guan Guan Shipping (Pte) Ltd. (The Golden Bear)⁽¹⁰⁾ where it was held that an agreement to abandon or rescind an arbitration agreement could be inferred from silence and inaction by the parties. Another note in the Supreme Court Practice Volume 1 at 18/15/3 which refers to the oases of Cargill v. Bower⁽³⁾ and Lewis v. Durnford⁽⁴⁾ that a claim in a writ not repeated in the statement of claim was treated as abandoned was cited in that case. Having regard to what I have said earlier this passage would appear to be misleading.

22. The particulars in paragraph 2C were struck out in July 1982 so that the delay in respect of which the defendant complains only applies from that time until leave was granted to commence the second action in February 1984. In my view the delay from July 1982 until February 1984 was not inordinate whilst I do not consider the evidence indicates that the 2nd plaintiff by its silence or otherwise can be said to be deemed to have been abandoned. In fact the evidence is to the contrary.

23. Criticism will no doubt be levelled at the 2nd plaintiff for the considerable period of time in which they purported to keep the contract alive which has resulted in the very substantial claim that has been made for the additional expenses. Nevertheless there is an admitted breach of contract by the defendant which gives rise to a claim for damages. Again there is a dispute as to when the cause of action arose and whether any of the claims are time barred. These matters are all in dispute. A Court will not decide upon an interlocutory application disputed questions of fart although it will decide a question of law, albeit of complexity, if it is satisfied that the 2nd plaintiff is bound to fail. However, I am far from satisfied that the 2nd plaintiff is bound to fail.

24. Mr. Phillips submitted that a number of the items that have been claimed do not consititute additional expenses for delay, but relate to damages for non-acceptance. Mr. Newman conceded that some items did not arise from delay, and with this concession, I shall disallow those amendments. However, there were certain other items to which Mr. Phillips took exception, but Mr. Newman contended that he should be permitted to argue these matters at the trial. I agree and shall allow those amendments to be made.

25. Mr. Phillips further raised the issue that the merits of the claim should be scrutinised very carefully as this was a case for service of the proceedings out of the jurisdiction under 0. 11. However, as leave had already been granted in 1980 on those particular facts, I am satisfied that the 2nd plaintiff has shown that there is a good cause of action.

26. I have come to the conclusion that no prejudice, hardship or detriment will be caused to the defendant by making the amendments which cannot be adequately compensated by an award of costs.

27. In all the circumstances and in the exercise of my discretion, I am satisfied that the 2nd plaintiff is entitled to an order to amend the re-amended statement of claim with the exception of those items of particular damage to which reference was made by Mr. Newman in his submission.

(B.L. Jones)

Judge of the High Court

(1) Civil Appeal No. 80 of 1985

(2) Unreported 13th March 1986

(3) [1878] 10 Ch.D.502

(4) [1907] 24 TLR 64

(5) [1950] 1 All E.R. 427

(6) [1956] CLY 6925

(7) [1965] 1 QB 232

(8) [1941] 1 All E.R. 228

(3) [1878] 10 Ch. D.502

(4) [1907] 24 TLR 64

(9) [1985] HKLR 263

(10) The Times 18th November 1986

Representation:

Mr. G. Newman Q.C. & it. Y.C. Mok (Foo & Li) for 2nd Plaintiff

Mr. N. Phillips Q.C. & Mr. A. Li (Denton, Hall, Burgin & Warrens) for Defendant

25548-EN-1984-03-29

KOMALA DECCOF & CO S.A. AND OTHERS v. PERUSAHAAN PERTAMBANGAN MINYAK DAN GAS BUMI NEGARA (PERTAMINA)

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HCA000960/1980

IN THE HIGH COURT OF JUSTICE

1980 No.960

BETWEEN

	KOMALA DECCOF & CO. S.A.	1st Plaintiff
	COLLIN NAVIGATION CO. S.A.	2nd Plaintiff
	KOMALA DECCOF & CO. (a firm)	3rd Plaintiff
	AND
	PERUSAHAAN PERTAMBANGAN MINYAK DAN GAS BUMI NECARA (PERTAMINA)	Defendant

_________

Coram: Hon. Power, J.

Date of Hearing: 24 February 1984

Date of Delivery of Judgment: 29 March 1984

___________

JUDGMENT

___________

1. In this matter the Plaintiffs on the 18th November 1982 applied before Mr. Justice Mayo for summary judgment. Mr. Justice Mayo granted judgment to the Plaintiffs in the sum of US$1,164,225 (being part of the Plaintiff's claim) with interest at the weighted average of the Hong Kong and Shanghai Banking Corporation's prime rate from the 1st of January 1977 to the date of perfection of the order herein and ordered that there was to be a stay of execution for 28 days from the date of perfection of the order. The order was perfected on the 16th December 1982 and was served on the Defendant's solicitors on the 17th December. On the 20th December Mr. Miles, of the Defendant's solicitors, spoke to Mr. Ip, of the Plaintiffs' solicitors, by telephone informing him the Defendant had calculated that the amount due to the Plaintiffs was US$1,962,038.11 together with interest. It seems clear that what Mr. Miles meant, by saying "together with interest", was that the amount was inclusive of interest. He told Mr. Ip that the interest was calculated at U.S. $133,885.88 per annum for 5 years and US$128,383.71 in respect of the first 350 days of 1982. He asked Mr. Ip how he wanted the money paid either by cheque or by draft and said that his own clients' preference was to make a T.T. payment direct to Mr. Ip's clients' account in U.S. Dollars. He told Mr. Ip that his clients were ready to make payment as soon as they were informed how the money was to be paid. Mr. Ip said that he requested Mr. Miles to reduce his request to writing and that he would take instructions from his client.

2. This conversation was, clearly, concerned with the mechanics of payment. The Defendants were asking would the Plaintiffs be prepared to accept a T.T. payment in U.S. Dollars direct into the Plaintiffs' account, i.e. would the Plaintiffs be prepared to allow them to make a direct telegraphic transfer from their own bank account to the Plaintiffs' bank account. This being so it could not be suggested that, at that time, the Defendants had the money ready for payment with their solicitors in Hong Kong. It seems clear that the money was still in Indonesia and was either in their bank or to their use and that they were seeking to be allowed to make payment in a way convenient to them. On the 23rd of December Mr. Miles wrote to the Plaintiffs' solicitors asking them to confirm the correctness of the calculation and saying that if he did not hear from the Plaintiffs' solicitors he would assume that the figure was correct and that payment in that sum would be made.

3. He did not, in this letter, pursue his request that the Plaintiffs agree to payment by telegraphic transfer in U.S. dollars. I am unable to see, on the facts set out above, how, as at the 23rd of December, it could be suggested that the Defendants had tendered the money or that the Plaintiffs had in some way waived an offer of tender. The Defendant was saying that it would make payment if it did not hear from the Plaintiffs but it stipulated no time limit for the reply. Further the Defendant's request as to the mode of payment was still unanswered.

4. On the 28th of November 1982 the Plaintiffs' solicitors wrote to the Defendant's solicitors saying, in reply to the letter of 23rd of December, "Kindly withhold to take any action in respect of the payment of judgment debt until you hear from us since we are taking instructions from our client who is now out of the Colony. We shall revert to you at the soonest".

5. This letter must be seen against the background both of the 23rd of December and of the telephone conversation of the 20th of December. In the letter of the 23rd of December the Defendant had asked the Plaintiffs to confirm the correctness of the calculation and in the telephone conversation they had asked to be allowed to make payment by way of the telegraphic transfer in U.S. dollars.

6. On the 4th of January 1983 some seven days later the Plaintiffs' solicitors again wrote to the Defendant's solicitors saying, that they agreed to the calculation and requesting that the payment be effected by T.T. Remittance in U.S. dollars directly to a named account. In this letter they claimed pursuant to Section 49 of the Supreme Court Ordinance that interest, at the rate of 14%, should be paid on the judgment debt from the 17th of December until the date of payment.

7. On the 13th of January 1983 the Defendant's solicitors wrote to the Plaintiffs' solicitors saying that their clients were arranging to make a remittance in U.S. dollars as requested. In this letter the Defendant's solicitors claimed that their clients had tendered the judgment debt to the Plaintiffs on the 17th of December 1982. The letter stated that the Plaintiffs had indicated they did not want payment to be made at that time and went on to contend that the Plaintiffs were not entitled to any interest. It was not never suggested before me that any offer of tender had been made on the 17th of December. It was submitted that such an offer had been made either on the 20th of December in the telephone conversation or on the 3rd of December by a letter.

8. I am informed that the amount of the judgment debt was in fact paid on the 12th January 1983. Mr. Lyell who appears for the Plaintiffs conceded that if the Defendant was able to establish that as a result of the letter of the 28th December it had acted to its detriment the Plaintiffs would not be entitled to the interest claimed after that date. This is, in my view, a not ungenerous concession as the Plaintiffs might have argued that no payment had ever been actually tendered to them and that the letter of the 28th of December was written not because they were waiving payment but because they were still seeking directions from their clients which would enable them to answer the Defendant's requests that the Plaintiffs confirm the correctness of the amount and that the Defendants be allowed to make the payment by telegraphic transfer in U.S. Dollars direct into the Plaintiffs' account.

9. The Plaintiffs when suggesting that this was so could have pointed to the letter of 4th January where they agreed to the Defendant's suggestion as to the mode of payment. It might have been argued that there was never any real tender of payment and that any delay that did occur was brought about by the Defendants themselves who were seeking to be allowed to make payment in a particular way. This was not, however, the approach taken by Mr. Lyell who was, as I have said, prepared to concede that if the Defendant established any detriment as a result of the letter of the 28th of December the Plaintiffs should be held to be not entitled to recover interest.

10. Mr. Lyell referred to Section 49 of the Supreme Court Ordinance which provides that

"A judgment debt shall carry interest at such rate as may be determined by the Chief Justice by order on the aggregate amount thereof, or on such part thereof as for the time being remains unsatisfied from the date of the judgment until satisfaction.

11. Mr. Lyell suggested that the Defendant must be relying upon an estoppel having been created in its favour by either the words or the letter of the Plaintiffs' solicitors and he referred to Spenser Gower on estoppel which deals, at 4, with the general principles as regards estoppel by representation as follows:

"Where one person has made a representation to another person in words or by acts or conduct, or (being under a duty to the representee to speak or act) by silence or inaction, with the intention (actual or presumptive), and with the result, of inducing the representee on the faith of such representation to alter his position to his detriment, the representor, in any litigation which may afterwards take place between him and the representee, is estopped, as against the representee, from making, or attempting to establish by evidence, any averment substantially at variance with his former representation, if the representee at the proper time, and in the proper manner, objects thereto".

12. What he relied on particularly was the statement that for such an estoppel to operate the representee must have altered his pposition to his detriment. He submitted that there was no evidence that the representee had altered his position to his detriment and that the representee was, therefore, not entitled to rely upon any estoppel.

13. Mr. Reed who appeared for the Defendant indicated that as to the first period, from the 17th to the 20th of December 1983, and as to the final period, from the 5th to the 11th of January 1984, there could be no argument that the Defendant was liable to pay interest. He submitted however that from the 21st to the 27th of December the Plaintiffs because of what their solicitor said in the telephone conversation were not entitled to any interest and that from the 28th December 1983 to the 4th January 1984 the Plaintiffs were in the same position because what their solicitor said in the letter of the 28th of January.

14. Mr. Reed conceded that there had been no formal tender but he said that the facts established that there had been a waiver by the Plaintiffs of payment or an acquiescence by him in the non-payment which prevented him from recovering interest. He referred firstly to Farquharson v. Pearl Assurance Co.⁽¹⁾ In that case an assured had fallen behind in the payment of a premium and the claimant, who later became entitled to the amount of payable under the policy and the Plaintiff in the action, called on the manager of the company and offered to pay the premium due. The manager declined this offer saying that he was arranging for a cheque to be paid by the assured. The cheque from the assured did arrive but it was post-dated and the assured died before the cheque became payable. The court held that the insurance company could not, in the circumstances, be heard to say that the premium which had been due had not been tendered. And the court held at 132:

I think it would be inequitable, in a case of this kind, if the insurance company, having had that offer of payment to its agent and manager, who was authorised to receive payments, having had that opportunity and that offer, was able to say in law there is neither tender nor anything equivalent to tender .... it does seem to me, on full examination of this case, that the insurance company certainly ought not to be heard to say there was nothing in the nature of tender, or that there was not a tender."

15. The facts in Farquharson's case are very different from those in the present one for in that case there was a specific tender and a specific refusal to accept and, more important, this refusal resulted in a clear detriment to the Plaintiff. In the present case what has not been proved is that there was any real detriment.

16. Mr. Reed next referred to Habib Bank v. Habib Bank A.G.:(2) There can be no argument with the statement in the headnote that:

"A broad approach is required in considering the doctrine of laches or acquiescence and not one based on the archaic and arcane distinctions between the assertion of equitable rights and the enforcement by equitable means of legal rights.

In this cas the Defendant bank had continued to trade under its own name and motif in circumstances where the Plaintiffs contended that it was not legally entitled so to do. There was clear evidence that the Plaintiffs had encouraged the Defendant to continue so trading but it was submitted by the Plaintiffs that there was no express proof that the Defendant had acted on that encouragement.

17. In the outcome the Court held that it had not been proved that the Defendant was not legally entitled to trade as it did.

18. The Court, however, went on to observe that even if it had been that the Defendant was not legally entitled so to trade, and even though there had been no express proof that it had acted upon the Plaintiffs' encouragement the Plaintiff would still have failed as the Court would have been entitled to infer such reliance from the circumstances.

19. It was never suggested that the Defendant bank would, by continuing to trade in its own name when not legally entitled so to do, have not suffered a detriment.

20. What the case laid down was that where a Defendant failed to produce specific proof that he had relied upon a Blaintiff's representation it was open to the Court, if the facts warranted it, to draw the inference that he had done so.

21. Indeed the law, in this regard, is, in my respectful view, correctly and succinctly stated in Prikhom Investments Ltd. v. Carr⁽³⁾ where Lord Denning, at 759, said:

"Once it is shown that a representation was calculated to influence the judgment of a reasonable man, the presumption is that he was so influenced.

22. The Habib Bank case, I am satisfied gave no support to Mr. Reed's submission that the burden of showing that whatever the representee did was not a detriment lay on the representor. His contention was that the representee to succeed need only prove a representation, and produce specific evidence or evidence from which it could be inferred, that he acted upon it. He submitted that it was for the representor to prove that whatever was done by the representee was not a detriment. He sought finally to establish this proposition by citing Greasley v. Cooke.⁽⁴⁾ He referred first to the statement in the headnote which says."

"The burden of proof was therefore on the Plaintiffs to establish that the Defendant had not acted to her detriment or her prejudice by remaining there."

The statement in the headnote appears to lay down a much broader peinciple than is justified by the decision itself. The facts reveal that the Defendant having been a servant in a household had then lived as common-law wife of one of the sons thereof and had acted as an unpaid housekeeper to 2 of his brothers and as nurse to his mentally ill sister. It was found as a fact by the trial judge that the Defendant's belief that she could remain in the house for as long as she wished had been induced by her common law husband and one of his brothers and the judge had "not the slightest doubt" that the Defendant, without payment, had looked after her common law husband and had cared for the mentally-ill sister which "was an unpleasant and hard task". The trial judge asked himself whether it had been "proved that she did that work without payment because of her belief that she would be entitled to live in the house as long as she wished". The judge appears to have had no doubt that representations had been given and that the Defendant had acted to her detriment. He was not, however, satisfied that the Defendant had proved that she acted to her detriment because of the representations. Lord Denning was satisfied that there was no burden, in such circumstances, on the Defendant so to prove. He held, at 713:

"So, instead of looking for another job, she stayed on in the house looking after Kenneth and Clarice. There is a pre-sumption that she did so relying on the assurances given to her by Kenneth and Hedley. The burden is not on her but on them to prove that she did not rely on their assurances. They did not prove it, nor did their representatives. So she is presumed to have relied on them. So on the burden of proof it seems to me that the judge was in error.

The Defendant having proved a detriment and proved a representation which was calculated to influence the mind of a reasonable person to enduce that detriment it was for the Plaintiff to prove that she did not rely upon that detriment.

23. In the present case the Plaintiffs concedes that they made a representation. The Defendant is entitled to ask the Court to infer that it relied upon that representation when delaying payment and it would be for the Plaintiff to prove that it did not. I am satisfied however that there is nothing in the authorities cited to me that relieves the Defendant from the burden of proving that what it did in reliance upon the representation was a detriment. Has the Defendant satisfied that burden? I have no doubt that it has not.

24. The Defendant simply refrained from paying. There is no evidence that it did anything that might have constituted a detriment - such a moving the money from one country to another or prematurely borrowing the money or taking it out of an interest bearing account. It is for the Defendant to establish that it has suffered a detriment and it fails wholly so to do if it proves nothing more than that it refrained from paying a debt due.

25. As the Defendant has not established that it suffered any detriment it is not entitled to rely upon any acquiescence by the Plaintiff to avoid the payment of interest on the amount due. Indeed, as Mr. Lyell finally pointed out, there was some evidence to suggest that the Defendant had not suffered any detriment as it had asked on 20th December to be allowed to make a direct telegraphic transfer from its account to that of the Plaintiffs which indicates that the money was being held by the Defendant in its own account. He submits that the Court would be entitled to infer from this that the Defendant had the use of the money and was suffering no detriment. I do not however, for the reasons set out above, need to consider that submission.

26. The Plaintiffs are entitled to interest at the specified rate from the 17th of December to the date of judgment.

The Plaintiffs also ask for interest on the sum now recovered namely $19,566.82 from 11th January 1983. Mr. Reed submitted that the Court had no power to make any such order as it was prevented by Section 48(2) of the Supreme Court Ordinance from giving interest upon interest. I am unable to agree with this submission. I am satisfied that on the 11th of January 1983, the date of payment of the judgment debt, the Plaintiffs by virtue of Section 49 became entitled to a sum certain in the amount of the interest then due. I am satisfied that the only proper way to regard this amount thereafter is as a judgment debt and that the Court has power under Section 49 to award interest on that amount at the rate determined by the Chief Justice.

	(N.P. Power)
	Judge of the High Court

(1) (1937) all B.R. 124

(2) (1981) 1 W.L.R. 1265

(3) (1979) 2 all E.R. 753

(4) (1980) 3 all E.R. 710

Representation:

Mr. Lyell (Messrs. Yung, Yu, Yuen & Co.) for the Plaintiffs.

Mr. Geoffrey Richard Miles (Messrs. Denton Hall & Burgin) for the Defendant.

31410-EN-1981-01-20

KOMALA DECCOF & CO. S.A. AND OTHERS v. PERUSAHAAN PERTAMBANGAN MINYIK DAN GAS BUMI NEGARA (PERTAMINA)

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