Fong Sun Development Ltd v Manohan Aluminium & Glass (Fiji) Ltd [2015] FJHC 198; HBC67.2005 (18 March 2015)

IN THE HIGH COURT OF FIJI AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO. HBC 67 OF 2005

BETWEEN:

FONG SUN DEVELOPMENT LIMITED
Plaintiff

AND:

MANOHAN ALUMINIUM & GLASS (FIJI) LIMITED
Defendant

COUNSEL : Mr. D. Sharma & Ms. N. Choo for the Plaintiff
Mr. S. Chandra for the Defendant

Date of Judgment : 18th March, 2015

JUDGMENT

Plaintiff's Case

[1] The plaintiff is the owner of a building known as "Nasilivata House". He had entered in to a contract with the defendant in 2002 May to supply and install aluminium windows to the 5th floor of the plaintiff's building. The agreed price for the contract was $27,800 + vat. The plaintiff alleges that the completion was to be done by 31.7.02. The plaintiff has paid $20,000 as a deposit part payment.

[2] The windows were done and fitted. However the plaintiff says the defendant failed to conclude the contract within the time period and had done the job with leaks and defective workmanship. The defendants had in fact tried to rectify the defects but it is alleged that the leaks continued. The plaintiff has filed this action for damages.

The Defendant's Case.

[3] The defendant submitted that they have done the work as per the agreement. But the plaintiffs had not paid the contracted sum and submitted a counterclaim to recover the balance money due on the contract.

[4] The following facts were agreed by the parties:

1. That the plaintiff was at all material times the proprietor of the Building known as "Nasilivata House" situated at 87 Ratu Mara Road, Samabula, Suva in the Republic of Fiji Islands.
   
2. That the Defendant at all material times engaged in carrying out manufacturing of aluminium and glass joinery and held itself out as able to supply and install good quality aluminium windows.
   
3. In or about May 2002, the plaintiff and the Defendant entered into a Contract whereby the Defendant agreed to supply and install aluminium windows to the 5th Floor of the Plaintiff's said building known as Nasilivata House for the price of $27,180.00 plus VAT.
   
4. On 9 July 2002, the plaintiff paid the sum of $20,000.00 to the defendant as part payment of the contract sum.
   

[5] The following were the issues to be determined by the Court:

1. Whether the defendant in breach of the Contract failed to complete the work on time.
   
2. Whether the defendant failed to complete the work in a proper workmanlike manner.
   
3. Whether the windows installed by the Defendant developed leakage.
   
4. If yes, whether the leakage was caused by the faulty workmanship of the Defendant.
   
5. Whether the materials used by the Defendant to install the window frames were suitable for its purpose.
   
6. Whether the Plaintiff's Engineer had sanctioned the materials that were used to install the aluminium frameworks.
   
7. Whether the Plaintiff is entitled to Judgement in the sum of $100,840.00 plus VAT.
   
8. Whether the Plaintiff is entitled to general damages.
9. Whether the Defendant is entitled to $10,459.61 together with interest.
   

[6] The Plaintiff called 3 witness and defendant called 3 witnesses.

[7] Plaintiff filed this action for damages on faulty workmanship, delay which resulted in a breach of Contract.

Determination

[8] Both parties were not at variance on their contractual relationship of supplying and fixing the aluminium windows, the contractual price and the sum paid as advance.

[9] In the evidence of plaintiff Mr. J. Chung, submitted that the 5th floor of his building had been completed. The defendants were contracted with supplying and fitting the aluminium windows. On the advice of his consultant the quotation submitted by the defendant had been accepted.

[10] There was no specific written contract submitted to court by any of the parties. Only evidence of the contractual relationship between parties was document "P1". This is a Quotation submitted by the defendant and accepted by the plaintiff on the advice of the Plaintiff's consultant."P1" contains the design, the measurements with the agreed price. It is dated 19.3.02 and it says that the work can commence within three weeks and will conclude in 6 to 7 months time. There was no specific evidence led by either party on the date of commencement or the date of conclusion.

[11] The defendant had breached the agreement when he failed to complete the work within the time stipulated. The document "P2" a letter addressed to the defendant by the solicitor of the plaintiff states that the work was to be concluded by 31.7.02 but the defendant had failed to do so. The defendant has failed to contradict this evidence. The defendants failed to cross examine on the date of conclusion reflected in P2. In the absence of such evidence, the only inference the court can draw is that the conclusion date was 31.7 2002 and the defendant had failed to complete the work on time.

[12] After the windows were installed it has been tested and had found out that water was leaking. This evidence is corroborated by Plaintiff's witness number 3. Mr. Satya Nandan, who was the supervisor of the plaintiff's construction site.PW 3 in his evidence, stated the method of testing the windows for water leakages.

[13] Plaintiff's witness Samutu Chang from Viewtech Company who had been called by the plaintiff to effect repairs, submitted that the repair of the existing widows cannot be done. The entire windows have to be replaced. The design of the widows doesn't suit a commercial building. As a result of this design fault the windows cannot be repaired. The defendant has failed to challenge this evidence. Marked document "P5" was a report from an independent consultant submitted on the water leakage. The consultant was not called by the plaintiff but the defendant has failed to challenge the evidential value of this document. Accordingly P5 becomes an unchallenged document. This court will deliberate on the contents of P5 in the course of this judgment.

[14] Even though the defendants at the outset denied any leakages as per the evidence submitted the plaintiffs have established that the windows were leaking after it had been fitted. This finding is well supported by the defendants own witness DW 3 who conceded that to some extent there were leakage from the new windows. The defendant's 2nd witness. S. Prasad denied any leakage. In the weight of evidence submitted on leakage this Court disbelieves the said witness's evidence. In my view, on a balance of probability the plaintiff has established that windows installed were leaking. The plaintiff has been successful in establishing that the leaks had occurred immediately after the installation of the windows.

[15] Both parties have agreed that the windowsill on the construction was made by the plaintiff. After taking the measurements of the sill the windows were made and installed by the defendant. The defendants contrary to the earlier denial submitted a defence that the leakages was not from the window but from the sill

[16] Now the Court will proceed to determine whether the leakage was from the windows due to bad workmanship or as a result of the windows being not properly fitted. PW 1 and PW3 the works supervisor both testified to say that windows were leaking from its mullion joints and not from the cement sill.

[17] PW 3 who was the work supervisor in his testimony states that soon after installation when the windows were tested for leakage by a water hose the water leaked from the aluminium joints. PW 1 Mr. Chang had observed water leaks from the Aluminium frames. Pw 2 who was from another aluminium fabrication company in his evidence submitted the leakage was a result of the aluminium window and not the cement. Window had been fitted to the sill. I find the evidence of PW 1and PW 2 are corroborated by the findings of the independent consultant whose report was marked P5.

[18] The report marked P5 described the test conducted, the methodology of the test and the findings. P5 concludes that the water was leaking from the glass/frame joints of the windows. As for P5 the sash windows were leaking and when the sash windows were opened, a number of windows the rubber seals had been broken and had come out. It is pertinent to note that as per the evidence tendered the windows had been done in September/October 2002. The test had been carried out within a short period. The test report is dated 30.7.03. During such a short period of time the windows cannot leak. The report P5 was not challenged by the defendant.

[19] The defendant's witness Mr. Lal and Mr. Prasad submitted that the aluminium windows require maintenance and the rubbers can perish. However as submitted a good quality window or rubber seal can't perish within such a short time. The court also observes that the defendants have failed to give an explanation as to how the leaks occurred when it was tested soon after installation.

[20] The defendant initially took the position that the leakage was not from the aluminium frame but was from the windowsill. The plaster of the aluminium window to fix it to the sill was done by the plaintiff.

[21] Under cross examination it was suggested to PW3 that on inspection it had been found that the exterior plaster fixing the window was 15mm. The inside plastering was lower as a result the water that falls on the higher exterior plastering can seep through the lower interior plastering. It was also suggested that the exterior plastering had been done in a way that prevents the smooth flowing of the water. This suggestion was vehemently denied by the plaintiff witness. Pw 1 and Pw 3 both states that the plastering was done under the instructions and supervision of the defendant. At one stage the plastering had been removed and have been redone on the instructions of the defendant. This was acknowledged by the defendant witness Mr. Lal. As per the evidence the plastering of the window sills have been done by the plaintiff under the instruction of the defendant. In view of the evidence the defendant's explanation that the leakage had occurred due to bad fixing of the window frames by the plaintiff's contractors becomes untenable.

[22] It is pertinent to note that the defence has failed to raise a single question to show from what part of the window the water was leaking. It is also pertinent to note that the defendant had failed to lead any evidence to show that the leakage was in fact occurring from the window sill.

[23] After considering all the evidence before me, especially considering the document P5, in my view the plaintiff has established to the satisfaction of the court that leak was occurring not from the plastered windowsill but from the aluminium window assembly.

[24] PW 1, in his evidence tendered that he was unaware of the quality or fabricating process of aluminium windows. As the defendant Company had a reputation, the plaintiffs had given the contract to him on the advice of the consultant. It is evident that the plaintiff being an ordinary man lacks the capacity of deciding the suitable type of windows and how it should be made. Whether the defendant possesses that experience and knowledge or not, in submitting the quotation the defendant had made the plaintiff believe that he possessed the necessary expertise and the knowledge. There was no evidence tendered to court that the materials that were used are of Inferior quality. As per the evidence of PW3 the contract had been awarded as the price was satisfactory. The plaintiff had completely relied on the expertise of the defendant to get quality suitably designed windows. There was no evidence submitted to court to prove that the plaintiff's engineer has sanctioned the material used in the aluminium frames.

The consultant's report.

[25] The consultant's report P5 sheds valuable evidence on the question as to from where the leak occurs. This report was marked with the consent of the defendant. The defendants initially accepted the report and cross examined on the basis that it was a mutually agreed finding. However as per the findings it was evident that the windows lack proper workmanship. It also finds that the water leak is occurring from the window assembly and not from the plastered sill. The defendant failed to cross examine on the finding that the rubber seals were coming out. Nor was in a position to give an explanation as to why the seals were coming out within such a short period of time. Nor did the defendant offer any expert evidence to show that in the normal course it can happen. The defendants have failed to lead any evidence to show that the windows are of good quality and suitably designed to fit the purpose. The explanation given by Mr. Lal on the issue that rubber seals can perish cannot be accepted as it had happened within a short period of the construction.

[26] The defendant submitted that the plaintiff had failed to supply any design or specifications for the windows. The defendant also challenged that the plaintiff has failed to object to the design of the windows. The court agrees on both these submissions. However, plaintiff has given an explanation to say that he was unaware of the aluminium work and that he had relied on the defendants' expertise to provide suitably designed windows for usage in a commercial building, the court accepts this explanation. The unsuitability of the design, the material, and the lack of workmanship in the final product has been established by PW2 and the consultant's report P5. The defendant failed to breach these allegations in cross examination. The findings of the report in a nut shell was the leaks are as a result of missing weep holes and drainage slots in the window assembly, lack of weather tight seals in the frame joints at the bottom corners and the mullion joints. Window frames used on the 5th floor was of a domestic grade.

[27] The court has considered the documents P6 and P8, which are two letters from the tenants informing about the leakages? The letters are dated in the year 2003 which are less than or within a year of construction. These two letters were never challenged by the defendants. This corroborates the plaintiff's version of leaking windows.

[28] As per the evidence before me, the defendant has failed to establish that the material used for fabricating the windows were suitable for the purpose. That it was a suitable design for the location and it was made of high workmanship.

[29] Even though the defendant raised the issue that the plaintiff has authorised the material used, the defendant failed to lead any evidence on this issue. Thus the issue is not proved. Considering all the evidence before me, in my view the plaintiffs on a balance of probability have been successful in proving the defendants liability.

Damages

[30] In determining damages, I find the plaintiff is claiming, the entire cost to replace the windows. PW1 submitted, that on various occasions to prevent the water from leaking he had applied or got workman to apply silicon to prevent the water leakage. However no receipts or certified copies of expenditure for this have been submitted to court. It was also undisputed that the aluminium window at some stage need regular maintenance to replace the perishable items used in the fabrication of the windows. The plaintiff's counsel too submitted that they were not perusing the expenditure incurred in trying to temporarily prevent the leakages.

[31] PW2 in evidence stated that the design of the particular type of windows that is fixed is not suitable for the purpose. Further as the windows are leaking in such a way it cannot be repaired but will have to be replaced. The document P7 was tendered as the cost for the replacement. I find the defendants have failed to cross-examine on the need for the replacement. There were no questions put to this witness to ascertain how many windows are leaking or whether all the windows fitted by the defendant have to be replaced. As submitted by the plaintiff under cross-examination the defendants failed to challenge the amount depicted in P7 thus the cost of replacement and the fact that the windows fitted were unsuitable for the purpose goes unchallenged. The defendant has failed to question PW2 pertaining to non suitability of the windows fixed by the defendants.

[32] As submitted the windows have been fitted in the year 2002. Evan with leakages the windows are still used by the plaintiff. The parties were not at variance that the balance money amounting to $10, 459 has not been paid by the plaintiff.

[33] The plaintiff has lead evidence to establish that the particular floor had been rented. The court has considered the documents P6 and P8 which are letters by the tenants of the particular floor informing the inconvenience caused by the leaking windows. However the plaintiff has failed to adduce any evidence to show that as a result of the leakage the tenants were lost or he was not in a position to rent the floor. The plaintiff has failed to lead any evidence pertaining to the pecuniary loss he had suffered by way of loss of rent or diminished rental value.

[34] The Plaintiff in the closing submission stated that they will seek only the cost that they will incur in replacing the windows. The quotation marked P7 is for replacement of the entire windows. The defendant has failed to cross examine on how many windows are leaking or whether the entire sets of windows have to be replaced.

[35] The Plaintiff attributes the cause for leaking to a design and workmanship fault. PW2 submitted that in a high rise commercial buildings when windows are designed provisions should be left in the aluminium frames to allow the water to drain out and not to the inner side, the correct design should place the window assembly in an outer aluminium assembly called the windowsill which has provisions to drain out the water to the outer sill of the window. It was explained to court that this sill is built to the aluminium assembly of the windows and it is not the plastered window sill that the windows are placed. It has been established that the windows in dispute lacks this mechanism. The defendant's 2nd witness too conceded that the model of the windows that are fixed in the plaintiffs building do not have this mechanism. In the absence of such mechanisms the plaintiff has established that water which falls to the outer surface seeps through the glass aluminium frame and comes to the interior. The defendants have failed to challenge this position of the plaintiff. The plaintiff's 2nd witness has said that said windows cannot be repaired but has to be replaced. The defendant has failed to cross examine this witness on the issue, nor to challenge the necessity of replacing the entire set of windows. However it is pertinent to note the following evidence of Mr. Charan Lal the manager of the defendant under cross-examination.

Q the problem is not with plastering. But a designer problem?

A If it's a designer problem it will affect all the windows.

Q shown P5 to the witness under 3.2 it identifies where the leakage is, it is part of the window system?

A It says water is coming from the aluminium windows I accept it.

[36] As per the evidence submitted the plaintiff has established the windows that the defendant supplied and installed had been leaking from the day the tests were done. Some attempts had been made to repair without success. It's also pertinent to note that initially the defendants have completely denied liability. Dw 2 in his evidence as well as under cross-examination denied the existence of any leakage. The witness's testimony is disbelieved by this court.

[37] I find the defendants have failed to cross examine on the faulty design. There was no denial of rubber seals of the windows coming out within a short period of fixing it nor an explanation offered.

[38] The defendants submission that the windows are still in the building and serves it's purpose has been negated by the overwhelming evidence of leakages and rubber seals coming out which demonstrates bad workmanship. The Plaintiff has successfully established that the windows are leaking and the defendant failed to challenge this evidence. The plaintiff also has established that the leakage is disrupting the tenants. This has not been challenged by the plaintiff. In this context the windows supplied and installed by the defendant are not serving its purpose. As I had stated in this judgment the defendant has failed to establish that the leakage was due to bad plastering and not as result of the aluminium window assembly. Plaintiff's witnesses have clearly stated that they had done the plastering on the instructions of the defendant; this is corroborated by the defendant's witnesses too. Even though the defendant was successful in establishing that there was no design or specifications given to him it is negated by the plaintiff's evidence which clearly indicates that the plaintiff was relying on the expertise of the defendant to install suitably designed windows to his building.

[39] Even though the defendant submitted that they had built windows to respectable clients the defendant fail to tender any evidence to show that they had designed the windows in issue to suit the purpose. In the light of defendants evidence that shows that the defendant had submitted the quotation on the basis of being an expert in the field of fabricating aluminium windows, when there's no specifications or design given the responsibility of the defendant is higher. As has happened in this case the buyer is purely relying on the sellers expertise to obtain a suitably designed set of windows that serves the purpose. It's his obligation to design fabricate and install windows that serves the purpose. In the light of the evidence before the court in my view the defendant has failed to establish that he discharged this obligation.

[40] In deciding the plaintiff's claim the plaintiff has established that the entire window assembly have to be replaced to rectify the situation. This was not challenged by the defendant. The plaintiff has tendered in evidence the cost of this replacement. However it is pertinent to note that the company which issued P7 quotation is no longer in existence. But according to PW2 the company is now in operation under a different name.

[41] The defendant has failed to challenge the quotation value or to submit any counter offer. No questions were put to PW2 to challenge the need for replacing the windows. The defendant has failed to put any questions on the probability of unjust enrichment.

[42] The plaintiff submitted that he is claiming damages on the basis that due to the defendant's negligence and faulty workmanship he has incurred damages. And that they have been deprived of a proper window for a commercial building. Based on P7 he has claimed $100840.

[43] The plaintiff cites the case of All Engineering Ltd v Pacific Parasail Ltd [2012] FJCA 54 and invites this court to act on the principle laid pertaining to the recoverable damages, where the court held "that in cases of breach of contract, the damages recoverable were such as fairly and reasonably be considered either arising naturally, that is according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract as the probable result of the breach of it" the Baxendale principles. The plaintiff also cited Victoria Laundry [Windsor]Ltd vs. Newman industries Ltd [1949]2KB528 "that every one,as a reasonable person is taken to know the ordinary course of things and consequently what loss is liable to result from a breach of contract."

[44] The plaintiff in this instance has asked as damages the replacement cost of the windows. In applying the principles laid above in my view the plaintiff has to prove that it was within the knowledge of both parties that in the event of a breach by the defendant he was aware of the probability that, he would have had to incur the replacement cost. I find the plaintiff has failed to lead any evidence on this line nor has, established that this knowledge was within the defendant at the time of entering in to the contract. The court has considered documents marked P2and P3. I find P3 has been replied by the defendant by P4. However both documents are dated after the contract was entered. In fact after the defendant had fixed the windows. Thus in my view both these documents do not impute the knowledge contemplated under the Baxendale principle. I also find that the plaintiff in this instance is not claiming his actual pecuniary loss he suffered as a result of the breach of contract, but is seeking the replacement cost at the present market rate. To prove this the plaintiff has submitted one quotation from a company that is now not in existence. No evidence was led to show how the quoted price of the windows had risen nearly five times within the time span. No evidence was led to show the inflation or the rise in price of material. It is also pertinent to note that the Plaintiff is seeking the replacement cost to replace the windows that are in the building by installing windows depicted in P7. The design of the windows to be installed is completely different to the windows the defendant had installed. The quotation P1 was given to design what was installed.

[45] The defendant in the submission has challenged that sum sought by plaintiff on the basis that the action is based on a contractual relationship and not tort. The defendant has quite correctly submitted that the plaintiff has failed to prove any loss of income from tenants as a result of the leaking windows. Evan though as a mitigatory factor the defendant submitted that the defendant had volunteered to remove these windows and replace the cost, no documentary evidence of this proposal was submitted. The defendant further submits that the quotation submitted was an out dated one and insufficient material has been placed before court to assess damages. The defendant citing Khan-vs- Vinod Patel & Co Ltd (2008) FJHC 102, Bonham Carter -vs- Hyde Park Hotel (1938) 6 TLR 177, Ratcliff –vs- Evans (1986)2 QB 524, Mohammed Hanif Khan –vs- Vinod Patel & Comp (2008) FJHC 102, HBC 141.06 submits that in the absence of proper evidence of losses the court should dismiss the action. I have considered the cases cited. The facts and circumstances of the said cases are different to the present case. However it is pertinent to note that the said case quoting. Butler –vs- Fairclaugh (1917). HCA 9 [1917] HCA 9; (1917) 23 CLR 78 the court had held that "damages in contracts which the plaintiff can claim are those which are within the contemplation of the parties at the time of making of the contract, or such loss as may fairly and reasonably be considered as arising was according to the usual course of things". "The object of the award of damages is restitutio in integrum that is to restore the party whose rights have been violated in the same position as if his right were observed or contract performed so far as money can do.".... This would not allow a party to recover any loss which would have been unpredictable, unforeseen or improbable.

[46] I agree with the principles laid down pertaining to damages in Hadley vs Baxendale (1854) EWHC J170; 156 ER 145.

[47] The knowledge either imputed or actual which the parties possess of any special circumstances at the time of the making of the contract is decisive in determining the extent of damages which a court would grant. However, the Defendants defence was not on this line. There was no question put to the plaintiff's witness challenging the replacement cost on the basis of forseability of the replacement cost or it not being contemplated in the contract as a probability in the event of breach. The defendant failed to lead any evidence to show that the defendant had the knowledge that in the event of breach of contract, replacement cost was inevitable.

Counter Claim

[48] There are no disputes as to the amount claimed by the Defendant in the Counter Claim. Plaintiff testified that the amount would have been paid if the windows were properly done or once notified about the leaks if the repairs were satisfactorily done. This is not challenged by the Defendants. The Plaintiff had paid nearly 2/3 of the agreed sum in the contract but had been left with a leaking set of windows. The defendants have failed to produce any evidence to show that the leaks were due to normal wear and tear or due to reasons beyond their control. It was submitted that the plaintiff was liable to pay if the contract was successfully completed by the defendants. As I have stated earlier in my judgment the defendants have failed to discharge the onus of proving the successful completion of the contract nor the successful handing over. This in my view is an absolute bar for the counterclaim. The defendant failed to satisfy court on their counterclaim. Accordingly I dismiss the counterclaim.

Conclusion

[49] With the overwhelming evidence of leaking windows, I hold that the defendants have breached the contract. For the reasons stated above the counter claim of the defendant stands dismissed. I also find that the plaintiff has not led any evidence to the satisfaction of court to be entitled for special damages. For the plaintiff to be entitled for the replacement cost under the heading of general damages according the Baxendale case (supra) it was incumbent on the plaintiff to prove that the parties had the prior knowledge or at least there was imputed or probable knowledge of the consequence of replacement in the event of a breach. Considering all the evidence led on a balance of probability I find the plaintiff had failed to prove this. However that does not disentitle the plaintiff to obtain general damages for the loss he had suffered .It was not disputed that the plaintiff had paid $20,000 on or about 9.7.2002. 14 years after payment of the initial sum the Plaintiff still finds his windows are leaking. As submitted I am also mindful of the fact that the plaintiff is still using leaking windows.

Special damages

[50] As there is no special damages proved I do not award any under this category.

General Damages

[51] Plaintiff has advanced $20, 000 to obtain the windows. As submitted what he has got is a set of windows that doesn't serve the purpose thus the plaintiff has suffered a pecuniary loss of $20,000 as a result of the defendant breaching his obligations under the contract. Accordingly I award a sum of $20, 000 as general damages. The plaintiff is entitled for an interest as he had parted with his money in the year 2002. Accordingly I grant the interest at the rate of 6% per annum on the sum of $20, 000 till the hearing.

[52] Accordingly considering all the material submitted I award $ 34,400 as damages to the plaintiff. I also award a cost of $ 5000 summarily assessed to the plaintiff. The said damages is made of:-

Damages	$ 20,000
Interest per annum	$ 20,000 X 6/100 = $ 1200
	$ 1200 X 12 = $14, 400
	$ 14, 400 + $20,000 = $34, 400

.............................
Mayadunne Corea
JUDGE
18.3.2015