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Grounds publishedDecided 31 Dec 2013
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High Court

Holland Leedon Pte Ltd (in liquidation) v C & P Transport Pte Ltd

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[2013] SGHC 281Case no. Suit No 239 of 2009

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  1. Lionel Yee JC:

  2. Introduction

  3. [1] This dispute arises out of the storage of metal coils in a warehouse.

  4. [2] The plaintiff, Holland Leedon Pte Ltd (in liquidation) (“the Plaintiff”), is a company registered in Singapore and is presently in members’ voluntary liquidation. Prior to the commencement of the liquidation process, the Plaintiff was in the business of metal stamping, tools and die making, clean room assembly, and manufacturing hard-disk drive covers. In 2004, the Plaintiffs sold its business to a company known as Metalform Asia Pte Ltd. The defendant, C & P Transport Pte Ltd (“the Defendant”), is also a Singapore registered company and is in the business primarily of providing logistics, transportation, and warehousing related services.

  5. The background facts

  6. [3] As the background facts to the present claim are somewhat drawn-out, I will for the purposes of this introduction only set out the significant events leading up to the trial. In so far as any further details are relevant to my findings, they will be discussed further in my analysis of the evidence.

  7. The Plaintiff’s stock of metal coils

  8. [4] After the Plaintiff sold its business to Metalform Asia Pte Ltd (“Metalform Asia”) in 2004, they continued to hold stocks of metal coils and steel sheets, and these were stored in a warehouse owned by Transware Distribution Services Pte Ltd (“Transware”). According to the Plaintiff, it discovered sometime in August 2005 that Metalform Asia was improperly appropriating its stocks. It therefore decided to move its coils and steel sheets to a different warehouse and the Plaintiff decided on storage of the stocks with the Defendant at its warehouse at 47A Jalan Buroh, Singapore 619492 (“the Defendant’s warehouse”). Most of the coils were made of stainless steel and these could be sub-divided into two main categories: Type SUS 304 coils (“SUS 304”) and Type SUS 430 coils (“SUS 430”). These differed in the amount of nickel present in the steel – in respect of the former, 8–10%, and in respect of the latter, less than 1%. Within each of these types, the coils could also be sub-divided into differing finishes of their surfaces with the main ones known as 2B and 2D. While most of the stainless steel coils were large so-called “mother coils”, there were some coils which were denoted as “small coils”. There were also some stainless steel cut sheets which are not the subject of the present proceedings. Apart from stainless steel coils, there were also smaller numbers of carbon steel coils and some aluminium coils known as Type ALUM H24. All the carbon steel and aluminium coils were mother coils.

  9. [5] Over a number of days in August and September 2005, the metal coils and steel sheets were transported by the Defendant from the Transware warehouse to the Defendant’s warehouse. By the Plaintiff’s estimate, these goods were worth a prime value of S$11,667,090. The following quantities and weights of coils and steel sheets were moved:

  10. [6] The warehousing arrangement or contract (“the Warehousing Contract”) was, according to the Defendant, governed by a quotation dated 26 August 2005, in which it was stated to be subject to the Defendant’s “Standard Terms and Conditions”. This quotation was never signed by the Plaintiff. It is not, however, disputed by the parties that the Plaintiff would pay the Defendant warehousing charges of S$11,240.36 per month (before Goods and Services Tax).

  11. The missing coils and damage to the coils

  12. [7] Sometime in May 2008, 11 mother coils were discovered to be missing from the Plaintiff’s stocks kept at the Defendant’s warehouse. The Defendant has not denied that these coils were lost. The Plaintiff also alleged that a larger number of the coils were damaged by flooding and handling by the Defendant. There were two known incidents of flooding during periods of rain at the warehouse – on 18 June 2008 and 22 October 2008. The damage to the metal coils was particularised by the Plaintiff as taking the form of water damage, handling or packaging damage, or severe deformation. Some coils were alleged as having suffered only one type of damage, while others suffered a combination of different types of damage.

  13. The 1st Miller survey and report

  14. [8] Arising from such discovery, the Plaintiff engaged a surveyor, Miller International Loss Adjustors (S) Pte Ltd (“Miller”), to survey the goods at the Defendant’s warehouse and to assess any damage by a visual inspection. An inspection was conducted by William Thomas Selby of Miller (“Selby”) from 20 to 22 October 2008. A survey report dated 5 January 2009 was produced (“the 1st Miller Report”). In this 1st Miller Report, Selby divided the coils into two categories: “sound” and “unsound” (hereinafter referred to as “the ‘sound’ coils” and “the ‘unsound’ coils” or described as “sound” or “unsound” as the case may be, respectively), with the latter being those where significant damage was identified. He also noted briefly the external condition of the coils he inspected.

  15. [9] On 17 March 2009, a writ of summons endorsed with a statement of claim was filed by the Plaintiff. This statement of claim was for the 11 missing coils, and for the 173 coils classified by Selby in the 1st Miller Report as “unsound”, and also a further five coils classified as “sound” which were described by Selby as exhibiting “coil damage”.

  16. The move to the Sagawa warehouse

  17. [10] In July 2009, the Plaintiff removed its metal coils and cut sheets from the Defendant’s warehouse to another warehouse run by a different warehouseman at 14 Tuas Avenue 1 known as the Sagawa warehouse (“the Sagawa warehouse”).

  18. The joint survey

  19. [11] From 30 November 2009 to 7 December 2009, a joint survey of the coils classified as “unsound” in the 1st Miller Report was conducted by Selby and the Defendant’s surveyors, Insight Adjusters and Surveyors Pte Ltd (“Insight”). During this survey, the 173 “unsound” coils were taken out by forklift from the stacks of coils in the Sagawa warehouse and a visual inspection was conducted.

  20. [12] From this joint survey, Mohamed Ferdaus bin Mohamed Yusoff (“Ferdaus”), who was then an employee of Insight, produced a report dated 4 March 2010 (“the Insight Report”). Selby also produced a report which was part of what is known as the 2nd Miller Report as described in the next few paragraphs. This report and the Insight Report are identical in so far as the description of the damage to each “unsound” coil inspected is concerned.

  21. The second Miller survey and report

  22. [13] On 3 December 2009, the Plaintiff’s solicitors wrote to the Defendant’s solicitors inviting them to also conduct a joint survey of the coils which had been classified earlier as “sound” in the 1st Miller Report, intimating that the Plaintiff might wish to claim damages in respect of those coils as well. The Defendant declined the invitation. The invitation was repeated on 8 December 2009 and 9 December 2009 and the Defendant’s position remained unchanged. On 10 December 2009, the Defendant’s solicitors wrote to state its position that any deterioration of the coils was due to storage in the Sagawa warehouse, and so they would not participate in the inspection of the “sound” coils.

  23. [14] From 10 to 15 December 2009, Selby inspected the “sound” coils by a visual inspection of their external condition. On 19 January 2010, Selby produced a second report (“the 2nd Miller Report”) covering his findings from the joint survey (with Insight) of the “unsound” coils as well as his survey of the “sound” coils.

  24. Laboratory testing

  25. [15] Because the inspections thus far were only based on visual observations, the parties decided that it was necessary to appoint steel experts to determine the “cause, nature and extent” of the damage to the coils. In June 2010, the Plaintiff engaged Dr Qiu Jianhai (“Dr Qiu”) of WebCorr Corrosion Consulting Services (“WebCorr”) and the Defendant engaged Mr Liam Kok Chye (“Liam”) of Matcor Technology & Services Pte Ltd (“Matcor”) as their respective experts. Dr Qiu and Liam were both metallurgists.

  26. [16] Representatives of both parties participated in a joint inspection at the Sagawa warehouse on 2 September 2010. Seven “unsound” coils (which I will refer to as “Coil No 1”, “Coil No 2”, etc) were selected as representative samples of the “unsound” coils which formed the subject matter of the Plaintiff’s claim at that time. Both WebCorr and Matcor used all seven coils to conduct their tests. The selected coils were partially uncoiled in a joint exercise and each side took samples from them for further laboratory tests and analysis. During this exercise, Dr Qiu decided to partially uncoil and take a sample from a coil which was classified as “sound” (“Coil No 8”) for testing, and as a result, Liam also took a sample of that same “sound” coil. Expert reports were produced by Dr Qiu and Liam on 30 November 2010 and 20 December 2010 respectively.

  27. The amendment to the statement of claim

  28. [17] On 21 March 2011, the statement of claim was amended by the Plaintiff to claim for loss and damage for an additional 415 metal coils on the basis of the 2nd Miller Report and the fact that Dr Qiu’s report disclosed damage to the eighth (“sound”) coil which was alleged to be worse than that sustained by the seven representative “unsound” coils. Due to what the Plaintiff says was a combination of oversight and misunderstanding between it and its solicitors, the 2nd Miller Report was not disclosed to the Defendant when it was produced and this was done only some time later.

  29. The reports on the quantification of the damage

  30. [18] Finally, on the basis of the data collected from the above mentioned reports, the Plaintiff’s expert, Dr Roger Hooper, a consultant in the stainless steel industry, produced a report dated 20 December 2011 (“the Hooper Report”) on the quantification of the damage suffered by the Plaintiff. Because Dr Roger Hooper was not available to give evidence at the trial, Peter Wildbore (“Wildbore”), also a consultant in the same industry, was called to give evidence as an expert witness for the Plaintiff. Wildbore agreed with and adopted the Hooper Report and all its findings and conclusions.

  31. [19] For the Defendant, Leow Jian Quan Kenneth (“Kenneth Leow”), a trader in the steel industry, produced a report dated 21 December 2011 setting out his opinion on the same issue. Ng Teck Hock Norman (“Norman Ng”), another metal trader, produced a further expert report on 20 December 2012. This report, together with Kenneth Leow’s earlier report of 21 December which Norman Ng adopted in full, formed the expert evidence given by Norman Ng for the Defendant at the trial.

  32. The present suit

  33. [20] The Plaintiff in the present suit claimed damages for the 11 lost coils and for the damage to the coils which it said was caused by the negligence of the Defendant as warehouseman. As I have noted (see above at [7]), such damage consisted of water damage, packaging damage and handling damage which, in some of the coils, took the form of severe deformity sustained by them. The Plaintiff’s pleaded particulars of negligence included allegations that:

  34. (a) the warehouse was not sufficiently resistant to water;

  35. (b) water entered the warehouse through the walls and/or the doors during rain;

  36. (c) the coils were stacked on top of one another without regard to the weight of the coils; and

  37. (d) the coils were stacked on top of one another without regard to the fact that some coils in the upper part of the stack were wet.

  38. [21] Subject to some concessions which I will set out below, the Defendant denied liability. It also alleged contributory negligence on the part of the Plaintiff. In any event, the Defendant claimed that the metal coils, when they entered its warehouse, were only worth scrap value, or, in the alternative, a value lower than their prime value. The Defendant also pleaded its Standard Terms and Conditions (“the Defendant’s STC”) and the Singapore Logistics Association’s Standard Trading Terms and Conditions (“the SLA Standard Trading T&C”) which it claimed were incorporated into the warehousing contract with the Plaintiff. The clauses in the Defendant’s STC and the SLA Standard Trading T&C which the Defendant relied on had the effect, the Defendant contended, of excluding and/or limiting its liability to the Plaintiff in the event that it was found liable. The Defendant claimed, in addition, that the Plaintiff had a duty to and failed to mitigate its losses.

  39. [22] Because the trial of the matter was not bifurcated, it falls to me to decide both the issues of liability as well as those involving the assessment of damages.

  40. The structure of my judgment

  41. [23] Given the numerous issues, it is necessary for me at the outset to describe the structure which I will use to analyse the evidence and set out my findings.

  42. [24] I start with my analysis of the evidence relating to the issue of the damage to the coils and my findings thereon. This will be under the heading “Damage to the coils” (see below at [26]–[130]). I begin first with the stainless steel coils. As I have noted, the present claim involves claims for damage to different types of coils (see above at [4]) and different types of damage, which, in respect of a particular coil, may be of just one type, or of a combination of them (see above at [7]). I therefore categorise the stainless steel coils in question into the following categories:

  43. The reason for categorising the coils into these categories will become apparent in my analysis of the evidence below. At the close of the hearing of the evidence at the trial which lasted 19 days, I directed counsel for both parties to make their closing submissions on the basis of these categories. This was duly complied with.

  44. [25] I deal next with the alleged damage sustained by the carbon steel coils, which I classify as Category H (see below at [128]), and the small coils, which I classify as Category I (see below at [129]–[130]). This will be followed by an assessment of the damages for which the Defendant is liable in respect of the coils under Categories A-I and this will include the pre- and post-damage valuation of all the damaged coils under the heading “Assessment of damages for damaged coils” (see below at [131]–[185]). I turn next to the 11 lost coils under the heading “The missing coils” (see below at [186]–[196]), after which the submission by the Defendant of contributory negligence will be discussed under the heading “Contributory negligence” (see below at [197]–[202]). I will then summarise the damages which are payable by the Defendant to the Plaintiff (under the heading “The total damages payable by the Defendant” (see below at [203])). This will be followed by consideration of the limitation of liability and exclusion clauses relied on by the Defendant (under the heading “The limitation of liability and exclusion clauses” (see below at [204]–[239])). Finally, the Defendant’s argument that the Plaintiff had failed to mitigate its losses will be dealt with under the heading “The duty to mitigate loss” (see below at [240]).

  45. Damage to the coils

  46. [26] On the evidence before me, there was significant uncertainty over how to reconcile the coils reported by the Plaintiff’s expert Selby as having suffered specific categories of damage with, firstly, the report of the Plaintiff’s expert Wildbore on the quantification of the damage suffered, and secondly, the number of coils which were the subject of the Plaintiff’s claim in its statement of claim. In the course of his oral testimony, Tay Puay Cheng (“Tay”), head of the office of the liquidators of the Plaintiff, provided a list which identified coils by the tag serial numbers used by the Plaintiff and the Defendant, and classified them under the categories of damage which the Plaintiff was claiming (“Tay’s List”). I found this list to be extremely helpful and it was partly on the basis of this list that I directed that the evidence was to be dealt with along the categories I have set out earlier (see above at [24]).

  47. Category A: SUS 430 coils which sustained water damage

  48. The coils in question

  49. [27] In respect of the SUS 430 coils alleged to have sustained water damage, Tay’s List identified 86 coils weighing a total of 398,883kg. Tay, however, explained that the Plaintiff’s claim was limited to only 85 coils with a weight of 391,903kg as set out in his affidavit of evidence-in-chief. Tay admitted that it was not possible to identify 85 specific coils with a total weight of exactly 391,903kg, but he sought to show that there were at least 85 coils with a combined weight exceeding 391,903kg which did sustain water damage. I agree with his approach. I note that none of the coils listed in Tay’s list in this category are over 5,000kg and so, regardless of which coil was omitted to bring the number down from 86 to 85 coils, their total weight cannot be less than 391,903kg.

  50. [28] With respect to these coils, the Defendant accepted that it was liable for the water damage sustained by all of them except for three coils (namely those bearing the tags CWT639/Tag-112, CWT646/Tag-115 and CWT701/Tag-32). These three coils, it submitted, should be excluded because they were reported in the 1st Miller Report produced by Selby as being “in apparent satisfactory condition” in October 2008, resulting in their classification by him as “sound” coils. The water damage was only subsequently reported in the 2nd Miller Report, and this inspection was conducted in December 2009, after the coils had left the Defendant’s warehouse, and without the participation of the Defendant’s expert. The Defendant also pointed out that these three coils were subsequently reported as having sustained both water as well as handling/packaging damage and the fact that the Plaintiff had not classified them as sustaining both types of damage in these lists cast doubt on whether any water damage had in fact been sustained.

  51. [29] On this latter submission, I am of the view that it is well within the Plaintiff’s right to claim for just water damage even if the evidence showed that more than water damage was sustained. The issue is whether there is satisfactory evidence of the specific damage claimed by the Plaintiff to have been suffered by the coils in question, which in this case is water damage.

  52. [30] As regards the former submission on the discrepancy between the lack of damage noted in the 1st Miller Report and the damage noted in the 2nd Miller Report, Selby explained that with respect to coils classified as “sound” in the 1st Miller Report but which had been found to be damaged in the 2nd Miller Report, he may have missed out some of the damage the first time round. This was because of the adverse conditions he had to work in during his first inspection in October 2008. According to him, the warehouse was dark and the coils were stacked in a way which made it difficult for him to gain access to them. His testimony on the dark conditions of the Defendant’s warehouse, especially its interior, was corroborated by another of the Plaintiff’s witness, Ser Sai Kiang Serene (“Serene Ser”). As regards the manner in which the coils were stacked, Selby’s testimony is supported by photographs taken of them in May 2008 and on 22 October 2008, which was the last day of Selby’s first inspection.

  53. [31] In contrast, the conditions under which both the joint inspection with Insight’s Ferdaus and the inspection which led to the 2nd Miller Report were conducted were, according to Selby, significantly better. This was not challenged by the Defendant. The methodology used for the inspection of the “sound” coils also appeared to be similar to that of the joint inspection, although Selby’s descriptions of the damage sustained were somewhat briefer than those used in the joint inspection. In the circumstances, I find that it was possible for damage, including water damage, to be missed out in the 1st Miller Report and identified only in the 2nd Miller Report. I therefore do not regard this discrepancy in the reporting of the three coils in question as, in and of itself, a sufficient basis to automatically exclude the three coils in question from being the subject of a claim for damage.

  54. Where was the water damage sustained?

  55. [32] Was the water damage sustained when the coils (including the three disputed coils) were at the Defendant’s warehouse? There was very clear and unchallenged evidence of water entering the Defendant’s warehouse on at least two occasions, namely, on 18 June 2008 and 22 October 2008. On both occasions, it was observed that the rainwater came into contact with a number of coils. There may, in the light of such evidence, also have been other instances of water ingress into the warehouse during other occasions of heavy rainfall. In contrast, there was no evidence of water entry into the Transware warehouse where the coils were stored prior to their move to the Defendant’s warehouse. Nor was there any evidence that the coils sustained any water damage at the Sagawa warehouse where the coils were moved to (from the Defendant’s warehouse) in July 2009. I note that by the time the coils were jointly inspected in November 2009, they had been moved to this warehouse for just over four months. Ferdaus, who conducted the joint inspection on behalf of the Defendant, reported that the “unsound” coils which were jointly inspected appeared to have been in contact with water “sometime ago” and that the signs of water contact were “badly fading by then”. He also observed that none of the “unsound” coils inspected were damp so as to indicate recent water contact. There was no evidence that the conditions under which the “unsound” coils (which were the subject of the joint inspection) were stored differed from that of the “sound” coils. In the circumstances, it is unlikely that any of the “sound” coils were damp in a manner consistent with recent contact with water either.

  56. [33] I therefore find that the water damage sustained by all the Plaintiff’s coils listed in this category was more likely than not to have been sustained while they were stored at the Defendant’s warehouse. With respect to the “sound” coils where water damage was reported in the 2nd Miller Report but not in the 1st Miller Report, the damage was either sustained prior to 20–22 October 2008 and missed by Selby in his first inspection or sustained some time after that but before they were moved to the Sagawa warehouse.

  57. Is the Defendant liable for such water damage?

  58. [34] I turn next to whether the Defendant is liable for such water damage. I have had to undertake this exercise even though the Defendant has accepted liability for the “unsound” coils in this category because no liability has been accepted for the three “sound” coils. There appears to be two possible causes of water damage to the coils, namely direct contact with water during the ingress of rainwater into the warehouse, and the stacking of wet coils on top of dry ones causing the latter to become wet.

  59. (1) Rainwater contact

  60. [35] As regards rainwater contact, the Plaintiff’s witnesses claimed that they had specifically put the Defendant or its agents on notice that the coils could not come into contact with water before or around the time they were moved to the Defendant’s warehouse. This was however denied by the Defendant’s then General Manager Leaw Tiew San (“Leaw”) although he did recall the Defendant’s director Ser Kim Koi Anthony (“Anthony Ser”) calling him to complain about the coils being left outdoors during a drizzle in the course of the move to the Defendant’s warehouse. Leaw did however accept that it was the Defendant’s duty to do prevent seepage of water through the walls of the warehouse, to do its best to make sure the coils were not in contact with water, and to prevent flooding. A bailee’s duty includes ensuring that the place where goods are stored is fit and proper (see Chua Keng Mong v Hong Realty Pte Ltd and others [1993] 3 SLR(R) 317 at [15], [16] and [20], a case involving dripping water). I am of the view that it is a matter of common sense that a warehouse where goods are stored needs to be kept dry and protected from rain and that some damage was likely to be sustained by the coils if there was contact with rainwater. Had the coils been resistant to water contact, they would have been stored in the open with perhaps a canvas covering, as with the steel frames in the case of Track-Truss Technologies Pte Ltd v UTi Worldwide (Singapore) Pte Ltd (Lim Guan Teh Transport Contractors (sued as a firm), Third Party) [2004] SGDC 42. The contract in the present case was, on the other hand, for their storage inside the warehouse and the proper storage conditions which the Defendants were bound to provide to the Plaintiff under their contract would accordingly have to include protection from contact with rainwater.

  61. [36] The Defendant did not plead an Act of God with respect to the flooding but argued that the flooding which occurred on 18 June 2008 was because of unanticipated rainfall levels beyond its control. It did not however provide evidence, such as the relevant design specifications for the drainage around its warehouse, to demonstrate this. Indeed, the next flooding incident on 22 October 2008 showed that there need not be rainfall to the same extent as that of 18 June 2008 to cause the ingress of water into the warehouse. There may indeed have been other incidents of rainwater entering the warehouse and coming into contact with the coils. While rainfall charts for June 2008 and October 2008 were produced by the Defendant, they only showed the very high rainfall levels of those two days in relation to other days in the two months in question. They did not show that the rainfall was of such an unprecedented magnitude that water ingress could not have been prevented with reasonable care. Moreover, similar to the situation in OTF Aquarium Farm (formerly known as Ong's Tropical Fish Aquarium & Fresh Flowers) (a firm) v Lian Shing Construction Co Pte Ltd (Liberty Insurance Pte Ltd, Third Party) [2007] SGHC 122 at [58], the witness in the present case who gave evidence on these rainfall charts was not an expert, and so he could only present the data, but could not and did not assist in analysing the data to allow me to reach any conclusion that the rainfall on these days was such that the flooding occasioned was clearly beyond the control of the Defendant.

  62. [37] Even if I accept that the Defendant’s obligation was only to do its best to prevent water from entering the warehouse, I am unable to agree that it had done so. The fact that the 22 October 2008 water ingress occurred about four months after the 18 June 2008 flooding indicated that little, if any, rectification work had been done by the Defendant in the interim. The Defendant had even sent a letter dated 27 November 2008 stating that they “currently do not have any plans to repair the seepage into our warehouse walls. We have considered moving the stocks to another location, however, no space is available”. Although Leaw claimed that the ramp at the warehouse entrance was raised after the June 2008 flood incident, he was unable to state when this was done.

  63. [38] I therefore find that the Defendant is liable to the Plaintiff for damage caused to all the coils in this category through contact by rainwater.

  64. (2) Stacking wet coils on top of dry ones

  65. [39] Turning to water damage caused by the stacking of wet coils on top of dry ones, I note at the outset that the evidence of this occurring at the Defendant’s warehouse is not definitive. While Wong Luk Heng Adrian (“Adrian Wong”), an agent of the Plaintiff, testified that the coils were moved a few days after the 18 June 2008 flooding incident, and some coils with tide marks (which would indicate prior water contact) were stacked on top of others, he did not see dripping water, nor did he touch their packaging (to ascertain if they were wet). If indeed some water damage was caused by stacking a wet coil on top of a dry one, the Defendant would likewise be liable for the improper handling and stacking which resulted in this. It is common sense not to stack clearly wet coils on top of dry ones and it was clear that the shifting of the coils within the warehouse, especially in the aftermath of the 18 June 2008 flooding, was done by the Defendant’s employees. While the Defendant’s Leaw testified that after the flooding, Serene Ser from the Plaintiff had asked for and was provided by the Defendant with a forklift and manpower to shift the coils, he was not present and could not testify on the extent of her actual involvement in the shift and there certainly was no evidence that it was Serene Ser, rather than the Defendant’s employees, who operated the forklift to move the coils. I am unable therefore to conclude that she was responsible for stacking wet coils on top of dry ones if this had taken place.

  66. [40] I therefore find that the Defendant is liable to the Plaintiff for the water damage caused to the coils in this category if such damage was caused by stacking wet coils on top of dry ones.

  67. The extent of the water damage caused to the coils

  68. (1) Not rendered completely unusable

  69. [42] On the other hand, the Defendant’s expert, Liam, expressed the view that the water damage was only confined to the outer layers of the coils and diminished as one moved further inwards. This was because the coils were tightly wound so that water penetration was limited, even if the straps securing the coils were broken. As far as microscopic pitting was concerned, this could be inherent on the surface of the steel at the time of manufacture as a result of impurities. Liam asserted that there was no clear correlation between rainwater contact and the presence of such pitting and criticised the findings of Dr Qiu attributing the pitting to rainwater through the use of energy dispersive x-ray analysis on samples of the coils. He also asserted that microscopic pitting did not prevent the use of the coils for hard-disk manufacturing because they would be subject to a cleaning process prior to such use.

  70. [43] With respect to the extent of the damage caused by contact with rainwater, I note that the visual examination of and the tests conducted on samples from a total of eight coils by both the Plaintiff and the Defendant appear to be confined only to the outer layers of those coils. In no case were more than about the first 15–16 layers of a coil uncoiled for examination and sampling. Moreover, the samples taken by both sides were from approximately similar locations on each of the coils. In Dr Qiu’s expert report, the captions on photographs 20 and 24, which describe the sample sites as having water marks, and the captions for photographs 54–57, support this. Even if Dr Qiu was correct about attributing microscopic pitting to rainwater contact, there is no evidence of such microscopic pitting occurring beyond the first few layers of the sample coils where the parties agree that visible water marks were also detected. The Plaintiff, on whom the burden of proving damage lay, had possession of the coils and could easily have undertaken tests to demonstrate that microscopic pitting attributable to rainwater contact could be found beyond those first few layers but they did not do so for even a single coil. In the circumstances, they have not proved, on a balance of probabilities, that such damage did extend beyond those layers which were uncoiled for the purposes of testing.

  71. (2) The percentage weight of the coils rendered unusable

  72. [44] I turn next to establishing the specific percentage of the total weight of the coils which was rendered unusable as a result of the water damage. I note that the Defendant’s expert Liam was prepared to accept the methodology adopted by the Plaintiff’s expert on quantum, Wildbore, namely, that of using the representative average values derived from the small number of coils selected for testing, at least in respect of the “unsound” coils listed by Selby in the 1st Miller Report.

  73. [45] However, the Defendant, in its closing submissions, contended that for the “sound” coils, the Plaintiff had to uncoil every single coil to determine the extent of the water damage sustained given the different and varying amounts of the damage suffered, and that the single sample coil selected by the Plaintiff from among the “sound” coils for detailed examination (known as Coil No 8 (see above at [16])) could not be regarded as sufficiently representative of the more than 540 “sound” coils. Unlike the “unsound” coils, where there was an agreement between the parties that seven coils were to be selected as representative samples to determine the extent of the damage, there was no such agreement between them on the “sound” coils. In the circumstances, the Defendant submitted that the Plaintiff had not exerted all reasonable efforts to prove its loss and that it was accordingly not entitled to claim any loss in respect of these “sound” coils, including the three in this Category A. In this regard, the Defendant relied on the Singapore Court of Appeal decision in Robertson Quay Investment Pte Ltd v Steen Consultants Pte Ltd and another [2008] 2 SLR(R) 623 (“Robertson Quay”). There, the court stated (at [31]):

  74. The Defendant submitted that Robertson Quay stands for the proposition that where it is possible for a plaintiff to provide clear proof of the extent of damage suffered, it must do so. The Defendant accepted that the Court of Appeal did recognise (at [30]) that:

  75. but contended that this was not a case where proof with “complete certainty” of the exact amount of damage suffered was impossible, such that the law accordingly did not require it of the Plaintiff.

  76. [46] In my view, the point made in Robertson Quay is that the law, in certain circumstances, does not require a plaintiff to prove with absolute certainty the loss suffered. To do so would in some cases lead to the result that no damages would ever be recoverable. This is so because of the nature of the damage sought to be proved (examples of which are in the quote from Robertson Quay in the preceding paragraph, viz, non-pecuniary loss and prospective losses). However, beyond this, the sufficiency of evidence required of a plaintiff to prove loss is, in my judgment, nothing more than a function of the law of evidence. In Harvey McGregor, McGregor on Damages (Sweet & Maxwell, 18th Ed, 2009) (“McGregor on Damages”) at para 8-002 the learned author succinctly states:

  77. [47] I am therefore unable to accept the Defendant’s contention that the failure to bring evidence in respect of each and every “sound” coil (through uncoiling and testing) means that the Plaintiff’s claim in respect of them automatically fails. The question is whether the evidence is sufficient for me to conclude that, on a balance of probabilities, the Plaintiff has proven the loss in respect of the “sound” coils which it claims. As I have indicated earlier, I find that the second inspection undertaken by Selby in December 2009 on the “sound” coils was no less reliable than the inspection of the “unsound” coils undertaken jointly by the experts of both sides a few days before. I have also found that the water damage to these coils was likely to have been sustained while they were at the Defendant’s warehouse and not at the Sagawa warehouse. There is no evidence that the nature of the “sound” coils or the conditions in which these “sound” coils were stored, whether at the Defendant’s warehouse or elsewhere, differed from those of the “unsound” coils. Given that the experts of both parties agreed to use representative samples for the “unsound” coils, and given that there was no evidence that any water damage sustained by the “sound” coils was different from that of the “unsound” batch, the seven “unsound” coils selected for testing (Coils Nos 1 to 7), together with the one coil chosen from the “sound” group (Coil No 8), are, in my view, sufficiently representative of the entire batch of coils which are the subject of the Plaintiff’s claim, whether these are “sound” or “unsound”. It is not necessary for the Plaintiff to uncoil every single “sound” coil in respect of which it is claiming.

  78. [48] The figures for the unusable percentage of the coils were computed by both parties’ experts from the number of layers of the coils which were rendered unusable. The Defendant’s expert, Liam, explained that he derived the percentages of the damaged portions of the coils he tested based on the number of layers where he found water marks plus one extra layer beyond those layers. The Plaintiff’s expert, Wildbore, derived average percentages of unusable portions from a table in Liam’s report but arrived at significantly higher percentages than those of Liam. It appears that he had overlooked certain details in Liam’s table. In particular, he overlooked the fact that some figures in Liam’s table were marked with a double asterisk which referred to a footnote indicating that for certain coils, the percentage set out in the table was that of the remaining portion of the coil after part of it had been cut away for testing purposes, rather than the actual extent of the damage observed.

  79. [49] When this was explained to Wildbore in cross-examination and when he was shown Liam’s actual calculations of the unusable portion, Wildbore sought to defend his original percentages (which, as I have noted, were significantly higher than Liam’s) by claiming that, in practice, a few more layers of a coil would be removed beyond the damaged ones (as a buffer). While the table in Liam’s report which Wildbore relied on was, in my view, easily misunderstood, I am unable to accept Wildbore’s adherence to his original percentages. The reality is that in the case of the coils with this computational error (identified as Coils Nos 2, 5 and 7 in the report), the experts from both parties who conducted the tests reported that they uncoiled until about 200kg or 500kg of the coil had been slit. In other words, the portions which were cut out were fixed lengths of the coils in question which had been uncoiled for purposes of examination and testing and this had nothing to do with the methodology propounded by Wildbore. It is accordingly not possible to conclude that Wildbore’s methodology leads to an accurate computation of the percentage. In any event, Liam’s own computation did already add an extra layer beyond the last layer of the coil where damage was detected as a buffer. I therefore prefer the percentages derived by the Defendant’s expert Liam to those of the Plaintiff’s expert.

  80. [50] The general approach taken was to compute the unusable percentage of each of the representative coils, and then to take an average value of them. With respect to the SUS 430 type coils, to which the coils of this category belong, there are two different surface finishes for them known as 2B and 2D. The Defendant’s expert Liam conceded that there was no technical difference between these finishes in determining the unusable portion of the coils. Of the three representative coils tested which were of the SUS 430 type, namely Coils Nos 2, 3 and 7, it was not disputed that Coil No 3 was in fact found to be deformed and could not be uncoiled. Liam nevertheless attributed an unusable portion of 1.68% to it on the assumption that it was not so severely deformed when it was jointly examined by Selby and Ferdaus in December 2009. This was because the coil was not described in their reports as “severely” deformed. It is, however, clear from the evidence that because this coil could not be uncoiled, the method of examining it was different and it consisted of cutting through several layers of a small rectangular area of about 20cm by 10cm on the surface of the coil to obtain samples for examination. The Plaintiff in its written closing submissions asserted that this was inaccurate given that each coil had a standard width of 121.9cm, which meant that the observation from a 20cm by 10cm rectangle could not be a reliable basis for drawing conclusions in respect of the damage sustained by the entire coil. However, counsel for the Plaintiff conceded in oral reply submissions that because its expert had also used Coil No 3 to compute the usable and unusable portions of the coils, the Plaintiff would be bound by that. As the unusable portions determined by Liam for Coils Nos 2 and 7 were 1.73% and 1.62% respectively, the average unusable percentage of the three coils representing this group of 85 SUS 430 coils which sustained water damage would accordingly be (1.68% + 1.73% + 1.62%) ÷ 3 = 1.677% which I will round up to 1.68%. I should add that even if I derived the average from only Coil No 2 and Coil No 7 (in other words, excluding Coil No 3), the average unusable portion would be 1.675% which I would also have rounded up to 1.68%.

  81. [51] I turn next to whether there should be an additional portion of the coils which should be regarded as unusable because their external sides had sustained water damage and therefore a cross-sectional portion on either side would have to be slit off in addition to removing several layers of the coils.

  82. [52] The Plaintiff’s expert, Wildbore, testified that this (ie, the slitting off of a cross-sectional portion on either side of a coil as described above at [51]) was a “normal recommendation” whenever tide marks (ie, water marks) were found on the sides of a coil. He supported the slitting off of 25mm on either side of the coil based on his “experience”. While he had in his report translated this into an additional 5% of each coil being regarded as unusable, he accepted Liam’s calculation that if this was applied to a standard 1219mm wide coil, the percentage derived would be 4.1%.

  83. [53] Liam also conceded that for coils with water marks on the side, slitting off the edges would be helpful but opined 12.5mm on either side would suffice because it was “a shame” to cut off more than that. Having reviewed the testimonies of both witnesses, I prefer the Plaintiff’s expert witness Wildbore’s recommendation of slitting off 2.5cm on either side of each coil. The reason proffered by Liam for his figure of 1.25cm was not convincing and that number only came up in his re-examination and upon him studying photographs of the damaged coils shortly before that, and even then only very briefly.

  84. [54] It follows that I regard a further 4.1% of the SUS 430 coils which have sustained water damage as unusable due to the need to slit off the side edges as a result of the water damage sustained. When this is added to the 1.68% representing the average number of layers of each coil rendered unusable (see above at [50]), a total percentage of 5.78% is derived.

  85. Conclusion in respect of Category A

  86. [55] When this percentage is in turn applied to the 391,903kg of coils in this category, 5.78% × 391,903kg = 22,651.99kg of the coils should, in my view, be regarded as unusable as a result of the water damage for which the Defendant is responsible.

  87. Category B: SUS 430 coils which sustained water and handling/packaging damage

  88. The coils in question

  89. [56] In respect of the SUS 430 coils claimed to have sustained a combination of water and handling/packaging damage, Tay’s List ([26] supra) identified 14 SUS 430 coils weighing 61,827kg. In contrast, in his affidavit of evidence-in-chief, he claimed such damage in respect of the same number of coils but with a higher total weight of 64,501kg. Tay conceded that he was not able to identify the coils with that higher total weight.

  90. [57] The Plaintiff argued that it was nonetheless entitled to claim that higher total weight because the difference in question was approximately the weight of one coil, and there were many coils found in Selby’s second inspection which had both water and handling/packaging damage but which were described as having suffered only water damage. In oral submissions, it was clarified that the Plaintiff’s position was, as Tay had testified, that it had listed 86 coils in Category A (ie, the SUS 430 coils for which water damage only was claimed) while claiming such damage for 85 coils, but many of these coils were reported to have sustained both water and packaging damage, so the one additional coil from Category A ought to be moved to and accounted for in Category B in order to arrive at the higher claimed weight, notwithstanding the fact that there had been no exact identification of which coil ought to be moved. Although the Plaintiff’s suggested approach is mathematically sound, I am unable to accept it. The Plaintiff pleaded in its statement of claim loss suffered in respect of only 101 SUS 430 coils. It is therefore unable to sustain a claim of 85 Category A coils (see above at [27]), 15 Category B coils (consisting of the original 14 coils and one moved from Category A), and 2 Category C coils (see below at [66]), amounting to a total of 102 SUS 430 type coils. Accordingly, the Plaintiff can pursue a claim for damage of up to only 14 coils amounting to 61,827kg in this category.

  91. Is the Defendant responsible for the water and handling/packaging damage?

  92. [58] The Defendant accepted liability for water damage as well as handling/packaging damage for all the 14 coils originally designated in this category in so far as they were identified as “unsound” coils. After the close of hearing of the trial, I sought written clarification from the parties as to how each coil in each category was categorised in the 1st and the 2nd Miller Reports. In the Defendant’s reply dated 7 October 2013, all 14 coils amounting to 61,827kg in this category were listed as “unsound” coils. The Plaintiff in its reply dated 9 October 2013 disputed certain aspects of the nomenclature adopted by the Defendant in its 7 October 2013 letter, but not the Defendant’s clarification as to the categorisation of particular coils. I find that the Defendant is accordingly liable for the 14 coils in this category.

  93. The extent of the damage to the coils

  94. [59] I turn next to the extent to which the Defendant is liable for water damage sustained by the coils in this category. The treatment of these Category B coils should prima facie be the same as that of the Category A coils. The Plaintiff’s expert, Wildbore, however, opined that because of the handling/packaging damage sustained (in addition to the water damage), 50% of the coils in this Category B would have been totally damaged, ie, 100% of each of these coils would be unusable. I note, however, that in cross-examination, Wildbore acknowledged that the figure of 50% was but an arbitrary “ballpark” one.

  95. [60] I am prepared to accept that the Defendant would be responsible for a greater extent of water penetration into the coils if they already had some mishandling or packaging damage and consequently more extensive damage due to contact with water was sustained by such coils. The difficulty with Wildbore’s expert opinion is the absence of evidence supporting the conclusion that half of the coils in this category would have sustained such increased damage, let alone the assertion that the damage sustained was throughout the entire coil. As I have indicated earlier, while there were assertions made, there was no empirical evidence that the microscopic pitting, alleged by the Plaintiff to have been caused by contact with rainwater, extended beyond the outer layers of the coils which the experts from both sides examined and tested (see above at [43]). Moreover, in respect of the coils in Category B, while the only one which was selected for testing (Coil No 3, which is identified as CWT705/Tag-552) was found to be incapable of uncoiling and was therefore unrecoverable, the experts of both parties agreed that this was because it was deformed and not because of water damage. I note further that in respect of the SUS 304 coils sent for testing, the one coil which fell into the category of coils for which both water damage as well as handling/packaging damage was claimed by the Plaintiff, namely Coil No 5 (CWT424/Tag-329), had the extent of its unusable portion assessed as only 2.97%. This is a far cry from the total damage claimed.

  96. [61] I am therefore not satisfied, on a balance of probabilities, that 50% of the coils in Category B suffered total damage as a result of water and handling/packaging damage as claimed by the Plaintiff. The evidence before me does not support a finding that the unusable portion of the coils in this category is any different from the unusable portion of the coils in Category A (see above at [54]).

  97. [62] Lastly, it also falls to me to decide whether the Plaintiff should even be allowed to claim for the water damage sustained by Coil No 3 (mentioned above at [60]). The Defendant conceded through counsel in oral submissions that it should. I agree. From the evidence, it is more likely than not that the deformity rendering the coil irrecoverable would have occurred only after the first flooding incident in June 2008 and after Selby’s first inspection in October 2008. This is because the 1st Miller Report (which was the result of Selby’s inspection) merely identified the coil as having sustained water and packaging damage, unlike a number of other coils where coil deformation or coil damage was noted. Although the conditions of the first inspection were less satisfactory than those of the second inspection, it is unlikely, in my view, that Selby would have completely missed out on the coil if its condition was as misshapen as was the case by the time it was examined by both parties’ experts in November 2009. I therefore allow the Plaintiff to claim for the water damage sustained by Coil No 3 on the same basis as the other coils in this Category B.

  98. [63] For the reasons set out under Category A (see above at [54]), I determine that the unusable portions of the coils in this Category B caused by water damage is also 5.78%.

  99. Conclusion in respect of Category B

  100. [64] As I have determined that the Plaintiff may claim damage to the coils weighing 61,827kg (see above at [57]), this works out to 3,573.6kg (being 5.78% × 61,827kg) of unusable material.

  101. [65] The Defendant is also liable to the Plaintiff for packaging damage for the 61,827kg of coils.

  102. Category C: SUS 430 coils which were severely deformed

  103. The coils in question

  104. [66] For this group of coils which were alleged by the Plaintiff as being severely deformed, Tay’s List ([26] supra) identified two specific coils weighing 8,899kg. Tay conceded that this weight, which was lower than that stated in his affidavit of evidence-in-chief, should be the extent of the Plaintiff’s claim. The Plaintiff in its submissions did not contend otherwise.

  105. [67] One of these coils, Coil No 2 (identified as CWT704/Tag-550), was tested jointly by the experts of both parties and it was found not to be so severely deformed as to be incapable of salvage. In fact, the experts for both sides had used Coil No 2, together with Coils Nos 3 and 7, to obtain the average percentage of unusable portions of the SUS 430 coils (although the percentages they arrived at differed (see above at [50])). In other words, Coil No 2 was in fact not treated by the experts as being totally irrecoverable. The Plaintiff contended in its closing submissions and in oral submissions that there was a risk that this coil was incapable of uncoiling since the damage it sustained appeared to be similar to Coil No 3 which could not be uncoiled and it therefore ought to be regarded as a total loss (discussed above at [60]). I am unable to accept this somewhat curious argument because there is no dispute that Coil No 2 was in fact capable of being uncoiled and was uncoiled.

  106. [68] The parties were also not in agreement on the treatment of the other coil in this category, namely, that identified as CWT653/Tag-103. The Defendant argued in oral submissions that the Plaintiff’s expert Wildbore had conceded that this coil had been wrongly classified as severely deformed, but it is clear from his testimony that he also said that it was difficult to assess whether the coil could be uncoiled. In any event, Wildbore’s testimony was based on his perusal of photographs of the coil, and so his observations must be treated with some degree of circumspection. I should, however, add that the fact that the representative coil from this category, namely Coil No 2, was found not to have sustained total damage does cast doubt on the extent of the damage sustained by this other coil.

  107. Is the Defendant responsible for the severe deformity of coil CWT653/Tag-103?

  108. [69] I note that with respect to this second coil (CWT653/Tag-103), the 1st Miller Report did not identify it as suffering deformity damage during the first inspection conducted by Selby in October 2008. The damage described at that point in time was only “water and packaging damage” and it was only in November 2009 (the date when the joint inspection was undertaken at the Sagawa warehouse which was several months after the coils had left the Defendant’s warehouse), that some degree of deformity was noted.

  109. [70] The experts of both sides agreed that deformity of the coils, whether in this category or in Category G below, was primarily the result of stacking the coils without regard to their weight. This would have been exacerbated if the coils which were stacked below other heavier coils had also sustained handling damage such as broken strappings as that would increase the risk of deformity.

  110. [71] The parties acknowledged in oral submissions that after the first inspection by Selby in October 2008, there was no evidence that the coils were moved again until July 2009 when they were moved out of the Defendant’s warehouse to the Sagawa warehouse. They were then stacked for storage in the Sagawa warehouse upon arrival. There was also no evidence that the movement of the coils to the Sagawa warehouse was undertaken by the Defendant’s agents or servants, and it was clear that the stacking of the coils upon their arrival was done by Sagawa’s staff under the directions of the Plaintiff’s Adrian Wong. In addition, they were subsequently moved, probably by personnel of the Sagawa warehouse operator and almost certainly not by the Defendant, to facilitate the joint inspections which took place in November and December 2009.

  111. [72] While Adrian Wong claimed that he did not see heavier coils stacked on top of deformed coils at the Sagawa warehouse and that it was “impossible” for heavier coils to have been stacked on top of lighter ones there, he acknowledged that he was not sure if the Sagawa warehouse operator did not re-stack the coils. The evidence of the experts from both sides who conducted the tests on the representative coils in late 2010, which included photographs taken by them, showed clearly that the Sagawa warehouse operator had at some point in time stacked coils without regard to their weight and that there were deformed coils stacked below other coils. The Defendant’s expert Ferdaus, who conducted the joint inspection nine months earlier in November 2009, testified likewise. His counterpart Selby recalled that the deformed coils were either under the weight of other coils or were segregated.

  112. [73] In the light of the fact that (i) this coil (CWT653/Tag-103) was not reported as having sustained deformity in October 2008 in the 1st Miller Report; (ii) there was no evidence of the coils being moved again by the Defendant prior to their movement out to the Sagawa warehouse; and (iii) there was evidence of improper stacking of the coils at the Sagawa warehouse, it is more likely that the deformity occurred after the coil left the Defendant’s warehouse and was brought to the Sagawa warehouse. I am accordingly unable to attribute liability for the severe deformity sustained by this coil to the Defendant.

  113. The extent of the damage of the two coils

  114. [74] I am, however, prepared to accept that coil CWT653/Tag-103, together with Coil No 2, sustained damage of a lower magnitude, namely, water damage and handling/packaging damage, which can be attributable to the fault of the Defendant. I note that water and handling/packaging damage was identified in both coils by Selby in the 1st Miller Report after his first inspection in October 2008, as well as by the joint inspection which took place in November 2009. Further, counsel for the Defendant also conceded in oral submissions that in so far as these coils suffered water and handling/packaging damage (rather than the severe deformity claimed by the Plaintiff), it was responsible for that damage as it was in respect of the Category B coils.

  115. [75] As regards the extent of water damage, my findings with respect to the coils in Category A (see above at [32] et seq) apply to these two coils as well. I have in fact accepted the use of Coil No 2 as one of the representative coils to derive the 1.68% average layer damage sustained by the SUS 430 coils in Category A (see above at [50]). Taken together with the 4.1% provision for slitting on either end of the coil (see above at [54]), the unusable portion of Category C coils is 5.78% of their total weight.

  116. Conclusion in respect of Category C

  117. [76] The total unusable material in Category C is accordingly 5.78% × 8,899kg = 514.36kg.

  118. [77] As regards handling/packaging damage attributable to the Defendant, the weight of the coils affected would be 8,899kg.

  119. Category D: SUS 304 coils which sustained water damage

  120. The coils in question

  121. [78] I turn next to the other type of stainless steel coils in respect of which the Plaintiff claimed: the Type SUS 304 coils. The SUS 304 coils which the Plaintiff claimed were damaged by water are placed in Category D. For this category, Tay’s List ([26] supra) identified 277 coils weighing a total of 1,250,549kg. This was more than the 252 coils with a total weight of 1,133,628kg which he had set out in his affidavit of evidence-in-chief. In its closing written submissions, the Plaintiff accepted that its claim was in respect of the lower weight of 1,133,628kg. The Defendant did not disagree.

  122. Is the Defendant liable for such water damage?

  123. [79] The Defendant accepted that it was liable for the water damage sustained by the coils in this Category D which were identified as “unsound” in the 1st Miller Report. There are only two such coils, namely, those identified as CWT509/Tag-315 and CWT411/Tag-180. These two coils weighed a total of 9,299kg. As with Category A, the Defendant disputed its liability in respect of the coils which were initially identified as “sound” in the 1st Miller Report (see above at [28]). Because the lower total weight for this category of 1,133,628kg set out in Tay’s affidavit of evidence-in-chief is to be used, this would mean that the remaining 1,124,329kg (being 1,133,628kg - 9,299kg) is disputed.

  124. [80] When the coils were moved from the Transware warehouse to the Defendant’s warehouse, the Plaintiff’s Serene Ser produced an inventory list of the coils (“Serene Ser’s List”). In this list, three coils out of a group of 12 coils were described by Serene Ser in a handwritten annotation as “shape out”, meaning that they were misshapen when they were moved out of the Transware warehouse prior to being loaded on to the trailers bound for the Defendant’s warehouse. Out of these 12 coils, seven are found in this Category D, and they are: CWT77/Tag-621, CWT79/Tag-145, CWT80/Tag-150, CWT82/Tag-149, CWT84/Tag-148, CWT86/Tag-153 and CWT87/Tag-146. It is, however, not clear exactly which three coils Serene Ser was referring to. The Plaintiff accepted that these three unspecified coils would be completely irrecoverable, but such loss could not be attributable to the Defendant. The Plaintiff thus sought to give credit to the Defendant by taking the average weight of the 12 coils in this group, multiplying this by three and then deducting the weight derived (being 16,656kg) from the overall unusable weight of the coils in all the SUS 304 categories. I am of the view that it is unlikely that the seven coils in this Category D were among the three coils which were found by Serene Ser to be misshapen. This is because the Plaintiff’s expert Selby, in his second inspection of the “sound” coils, did not find in his 2nd Miller Report that these seven coils had sustained any deformity. Instead, as I indicate below, there were four other coils in this group of 12 which were specifically identified as being deformed in the joint inspection (see below at [95] and [125]), and in my view, it is likely that Serene Ser was referring to three of these four coils. I therefore make no reduction in the Plaintiff’s claimed weight for coils in this category to account for the three coils in question.

  125. [81] In so far as (a) the existence of water damage to these coils and (b) the Defendant’s liability for such damage is concerned, my findings in respect of the Category A coils (see above at [32]–[40]) apply to these Category D coils as well. In other words, I find that the Defendant is liable for the water damage sustained by the coils, whether or not they belong to the “sound” or “unsound” lists in the 1st Miller Report.

  126. The extent of the water damage caused to the coils

  127. [82] The analysis in relation to the extent of the damage sustained by the coils in this category also mirrors that for Category A above. For the reasons set out earlier (see above at [48]–[49]), I regard the computation used by the Defendant’s expert Liam to derive the average percentage of the unusable portion of the water damaged SUS 304 coils to be more accurate than that propounded by the Plaintiff’s expert Wildbore. The average of the unusable portions determined for the two representative coils jointly tested (14.58% for Coil No 4 (CWT509/Tag-315) and 2.97% for Coil No 5 (CWT424/Tag-329)) is 8.77%.

  128. [83] I note, however, that the experts for both parties examined and tested samples taken from another SUS 304 coil, Coil No 8 (see above at [16]), which was not identified as having sustained water damage in Selby’s first inspection and the 1st Miller Report in October 2008, but was found to have sustained such damage in his second inspection in December 2009 and the 2nd Miller Report. The Defendant’s expert Liam assessed the unusable portion of this coil to be 3.14% and stated that if this was added to the figures in respect of Coils Nos 4 and 5 (as used in the calculation above at [82]), the average unusable portion would be reduced to 6.9%. In my view, this lower percentage figure should be used. There is no reason why Coil No 8 should be treated differently from Coils Nos 4 and 5 for the purposes of determining the unusable portions. This is especially so since I regard (a) the damage discovered in Selby’s second inspection of the “sound” coils to be as reliable as that of the joint inspection, (b) the water damage to be likely to have been sustained while they were at the Defendant’s warehouse, and (c) the nature of the “sound” coils and the conditions in which they were stored to be the same as those of the “unsound” coils (see above at [47]). Given that a larger sample size of three coils (as opposed to two coils) will yield a more representative result, the lower average of 6.9% should be applied. While the Plaintiff has only claimed handling/packaging damage for Coil No 8 (as identified in Tay’s List), and its claim would accordingly be limited to that extent (as the Plaintiff accepts in its closing submissions), this does not preclude me from using the results of the tests on Coil No 8 to derive a more accurate percentage of the unusable portion of the SUS 304 coils in this Category.

  129. [84] I also note that all three of these representative coils had 2B surface finishes. No SUS 304 coils which were selected for testing had 2D surface finishes. This is, however, not material. The Defendant’s expert Liam accepted that there was no technical difference between a coil of 2B finish and a coil of 2D finish for the present purposes.

  130. [85] My conclusions for Category A with respect to the inclusion of an additional 4.1% of unusable material arising from the need to slit the ends of the coils which have sustained water damage (see above at [54]) also apply to these SUS 304 coils. The total unusable portion of the coils in this Category D is accordingly 6.9% + 4.1% = 11% of their total weight.

  131. Conclusion in respect of Category D

  132. [86] Applying this percentage to the total weight of the coils (1,133,629 × 11%) yields 124,699.19kg of unusable material.

  133. Category E: SUS 304 coils which sustained water and handling/packaging damage

  134. The coils in question

  135. [87] In respect of the SUS 304 coils alleged as having sustained water and handling/packaging damage, Tay’s List ([26] supra) identified 153 coils weighing 668,309kg. While the number of coils in the list was the same as that stated in his affidavit of evidence-in-chief, the affidavit stated a lower total weight of 666,740kg. Both parties agreed to use this lower weight as the basis of the Plaintiff’s claim in this category.

  136. Is the Defendant responsible for the water and handling/packaging damage?

  137. [88] The Defendant accepted that it was liable for the water and handling/packaging damage sustained by the “unsound” coils (as listed in the 1st Miller Report), but not those coils listed as “sound”. The former subset consists of 27 coils weighing 137,310kg. The latter subset has a total weight of 530,999kg. However, as I will use the lower weight of 666,740kg as indicated in Tay’s affidavit of evidence-in-chief (see above at [87]), this means that the water and handling/packaging damage to the remaining 529,430kg (being 666,740kg – 137,310kg) is disputed by the Defendant.

  138. (1) Water damage to the coils

  139. [89] In so far as (a) the existence of water damage to the “sound” coils and (b) the Defendant’s liability for such damage is concerned, my findings above in respect of the Category A coils (see above at [32]–[40]) apply equally to these Category E coils. In short, given that there was no evidence of contact with rainwater on any occasion other than at the Defendant’s warehouse, such liability must, on a balance of probabilities, be attributed to the Defendant.

  140. [90] Further, unlike the three “sound” coils in Category A, all the “sound” coils in this Category E were in fact recorded by Selby during his first inspection and in the 1st Miller Report as having sustained water damage (described with the label “tide mark” or “water … damage”). This indicates that as at October 2008, these coils had already come into contact with water. It therefore follows that the Defendant would be liable for the water damage sustained by all 529,430kg of “sound” coils in this category.

  141. [91] When this is added to the 137,310kg of “unsound” coils for which the Defendant has accepted liability, the Defendant is liable for water damage sustained by coils in this category weighing a total of 666,740kg.

  142. [92] In respect of the coils which were damaged before they came into the possession of the Defendant, the Plaintiff has conceded that it should not be allowed to claim for them. As will be seen below (at [93] et seq), I would therefore deduct the weights of 5,141kg and 4,942kg from 666,740kg (which is the sum of both the “sound” and “unsound” coils), leaving the weight of 656,657kg of coils in this Category E in respect of which water damage is claimable.

  143. (2) Handling/packaging damage of the “unsound” coils

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