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The Court of First Instance gave judgment after trial,  in Hydrotech Waterproofing Solutions Limited v Shun Yuen Construction Company  Limited [2022] HKCFI 1170

(https://lnkd.in/gW2jFARJ).

As the judge observed, the claim arose from a not uncommon occurrence in the local construction industry in which a contractor has completed works but not received payment from an intermediary up the contractual chain.

In this case the unpaid sub-sub-contractor and plaintiff was a waterproofing specialist, which had been paid for certain but not all of its completed works by a third-party sub-contractor. After the sub-contractor was wound up, the plaintiff sought recovery ‘up the chain’ against the main contractor and defendant.

The claim therefore turned on whether there was any contractual relationship between the plaintiff waterproofing specialist and defendant main contractor, notwithstanding that there was also a contract for the same works between the waterproofing specialist and the wound up third-party sub-contractor.

The judge found that there was no such contractual relationship [75]. The judgment contains discussion of the authority of site-agents, the formation of contracts in contractual chains and implied contracts by conduct [47]-[63], in addition to some useful commentary in relation to the approach of the courts when the credibility of witnesses is in issue, which may be of interest to practitioners.

Prince’s Chambers’ Phillip Rompotis and Josh Baker, instructed by MinterEllison, appeared for the successful defendant.