Shi v Jiangsu Native Produce Import & Exprt Corp

A claimant bears the burden of proving a money claim. Establishing employment and showing that only part of a claimed salary was paid does not shift that burden to the alleged employer.

For wrongful occupation of land, a claimant may elect between damages for loss and restitution of the benefit received. The remedies are mutually exclusive. Where damages are claimed, mesne profits are assessed by reference to the owner’s loss from being deprived of possession. The subjective devaluation principle belongs to restitutionary assessment and cannot reduce damages for trespass.

Mr Shi appealed against the dismissal of his claims against his former employer, a Chinese company, for salary arrears and expenses. The claims concerned periods before and after the winding-up of its United Kingdom subsidiary. The appeal was limited to those money claims.

The company cross-appealed against the dismissal of its counterclaim for mesne profits following Mr Shi’s continued occupation of company-owned residential premises after termination of his licence. The central issues were whether the judge had applied the correct burden of proof and whether mesne profits could be reduced to nil by reference to alleged exceptional circumstances.

1. Money claims—appeal dismissed. The claimant had to prove the alleged contractual obligations, the unpaid salary and expenses, and the company’s liability. No evidential burden shifted to the company merely because Mr Shi established employment or alleged that only part of his salary had been paid. The judge was entitled to reject the claims, having regard to their unexplained fluctuations, lack of satisfactory documentary support and his adverse assessment of Mr Shi’s credibility (paras [13]–[17]).
2. An alternative quantum meruit claim for work allegedly performed after the property transaction failed could not be advanced on appeal. It had not been pleaded, and it would have required particulars and quantification (para [17]).
3. Mesne profits—cross-appeal allowed. An owner deprived of possession may elect between damages for loss caused by trespass and restitution of the occupier’s benefit. The remedies are mutually exclusive. The pleaded counterclaim was a claim for damages, so the relevant measure was the loss caused by deprivation of vacant possession, assessed at £114,345 in accordance with the expert valuation. The judge therefore erred by assessing the claim as restitution and awarding nil (paras [20]–[23], [27]).
4. By way of additional guidance, if the claim had been restitutionary, subjective devaluation could reduce open-market value only where circumstances made the premises worth less to the particular occupier than to a typical potential occupier. General unusual circumstances were insufficient. Employment, rent-free occupation, delay, mistaken belief in a right to remain, lack of other accommodation and the company’s corporate circumstances did not justify a reduction on these facts (paras [24]–[26]).
5. The appellant’s appeal was dismissed and the respondent’s cross-appeal was allowed. The mesne profits were assessed at £114,345.

• Court of Appeal (Civil Division): allowed the respondent’s cross-appeal on mesne profits and dismissed the appellant’s appeal concerning salary and expenses.
• Central London Civil Justice Centre: HHJ Ryland dismissed the money claims and the claim concerning the property, ordered possession after termination of the licence, and dismissed the counterclaim for mesne profits.