CHAN KONG SHUI v. NEW GAS AND CO. AND ANOTHER

HCPI 343/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO.343 OF 2000

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J U D G M E N T

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1. The plaintiff's claim for damages as a result of personal injuries sustained in an accident at the construction site where the plaintiff was working on 5 July 1997 has been settled by both defendants consenting to judgment to the plaintiff in the total amount of one million dollars together with costs. The plaintiff has therefore dropped out of the picture entirely. Contribution Notices having been served by the two defendants inter se, what remains now is for me to deal with the apportionment of liability between them.

2. There is no dispute that the plaintiff was employed by the 1st defendant as a painter. The 1st defendant was the fire installation subcontractor of the 2nd defendant and whose work included the painting of fire hydrants and fire pipes at the site. The site in question is the Lai King MTR Station. There is also no dispute that the 2nd defendant is the subcontractor for mechanical and electrical installations at the site. The principal contractor of the site is one Maeda Corporation but is not a defendant in the present proceedings. The owner of the site, again not a defendant herein, is the MTR Corporation.

3. It is also not disputed that the accident happened as follows. On the day in question the plaintiff was given the task of painting fire pipes at the site. These fire pipes were installed in the vicinity of a staircase at the Lai King MTR Station. In carrying out this work, the plaintiff was standing at various positions on the staircase itself. The pipes which had to be painted red were situated some two metres above the staircase. In order to reach the pipes to paint them, the plaintiff had to hold the paint brush and stretch his hand some way over his head. In the course of carrying out this work in the manner described, the plaintiff slipped on the staircase, fell down and injured his back hitting it against the staircase on which he fell. There is also no dispute that the cause of the plaintiff slipping on this staircase was due to the fact that there was water and sand along the staircase on which the plaintiff was working causing the plaintiff to slip. This water and sand had flowed down from the upper part of the staircase where other contractors had been working.

4. In so far as the 1st defendant is concerned, its claim for contribution against the 2nd defendant is based solely upon the apportionment of responsibility between the two defendants arising from negligence and or the breach of common duty of care as an occupier of the site. In this respect the 1st defendant's argument is that since the 1st defendant is only a subcontractor of the 2nd defendant and that it was invited onto the site to do the subcontract works, therefore the 1st defendant was entitled to assume that the 2nd defendant has taken steps to ensure basic safety in so far as the site was concerned. Moreover the 1st defendant relies, as a matter of fact, upon the 2nd defendant taking upon itself the obligation of ensuring safety on site by appointing safety officers, issuing safety manuals to workers and generally overseeing all safety aspects concerning the works and workers on site. On that basis the 1st defendant argues that at most the 1st defendant should only be responsible for a technical breach of its duties to ensure safety for its workers on site.

5. The case for the 2nd defendant in so far as contribution is concerned is put on a slightly different footing. Firstly, the apportionment of liability based on the responsibility of each of the defendants towards the plaintiff. In this respect the 2nd defendant seeks to rely on the fact that the 1st defendant was the direct employer of the plaintiff and as such had failed to provide the plaintiff with the necessary tools and equipment such as a ladder by which the plaintiff would have been put in a better and safer position in which to carry out this painting work, particularly as it would have obviated the need for the plaintiff to have stood on the stairs at the site, at times on tiptoes, reaching for some distance over his head to paint the fire hydrants and fire pipes which were situated some two metres above the staircase. Under those circumstances, the 2nd defendant submits that the 1st defendant was in breach of its duties as an employer to provide the plaintiff with the necessary tools and equipment which was the cause of the accident to the plaintiff.

6. Secondly, the 2nd defendant takes a further point, namely, that on a proper construction of the subcontract between the 1st and 2nd defendants, the 2nd defendant is entitled to a full indemnity by the 1st defendant in respect of the damages recovered by the plaintiff.

7. The plaintiff, who was called as a witness by the 1st defendant, gave evidence which I accept in relation to the occurrence of this accident. The plaintiff's evidence was that he had been working as a painter painting fire hydrants and pipes at the site for the 1st defendant since April 1997. The accident in which he slipped fell and injured himself while working on the staircase at the site took place at about 2:30 p.m on 21 July 1997. For the several days before the accident he was engaged in similar type of work at the site. However on those days before the accident he was able to find a wooden ladder at the site which he could make use of and so did not have to reach above his head while standing on the staircase to paint the fire hydrants and pipes. Furthermore, he gave evidence that on the several days before the accident that part of the staircase on which he worked did not have water, sand and mud on it. On the day of the accident, however, he was unable to find a wooden ladder for his use on the site resulting in his having to stand on the staircase and painting the overhead pipes with his head looking up and stretching his hand over his head. At some time after 2:00 p.m he noticed water, sand and mud running down from the top landing of the staircase on which he was working. This was due to other works being carried out at the top of the landing of that staircase on which he was working. This water, sand and mud made this staircase slippery, but because he did not have a ladder to work with he had to work standing on the staircase notwithstanding the water sand and mud dripping down from the upper landing. Despite being provided with anti-slip shoes by the 1st defendant, he slipped, fell and injured himself.

8. There was also evidence from the plaintiff that for the four months or so that he worked for the 1st defendant, he was not given any specific safety instructions by the 1st defendant apart from being supplied with safety shoes and possibly other basic safety equipment such as helmet and safety belt. On this site, according to the plaintiff, a safety officer employed by the 2nd defendant and whom he knew to be called "Uncle Lam" normally made his routine daily inspection and looked around the site for the four months or so that the plaintiff worked there, "Uncle Lam" had never spoken to him or his colleagues on safety aspects of work on the site. There was no safety officer from the 1st defendant on site and he took his work instructions from the leader of the gang by the name of Chong Kam Sheng.

9. The director of the 1st defendant also gave evidence. His evidence was to the effect that he had entered into a general subcontract with the 2nd defendant in January 1990 and arising from that general subcontract the 2nd defendant would place work orders with the 1st defendant from time to time. One such work order was placed by the 2nd defendant in July 1996 which was for fire installation works on the site.

10. His evidence was that before this work order was agreed between the 1st and 2nd defendants, he had orally agreed with the manager of the 2nd defendant at a meeting that the 1st defendant would not be required to have any safety officer on site but that the safety aspects of all subcontract work was to be done by the 1st defendant and/or its workers would be supervised by the safety officer of the 2nd defendant. As a result of such agreement the 1st defendant did not engage any safety officer on site but relied upon the safety officer of the 2nd defendant to ensure compliance with safety rules and procedure by the 1st defendant's workers.

11. The 2nd defendant called one witness, namely Mr Fong Fu Sang, the safety supervisor of the 2nd defendant on site at the material time. He gave evidence that concerning the aspect of safety on site, either he or Uncle Lam would normally carry out one round of inspection, usually in the morning between 9:00 a.m and 11:00 a.m on site. During this round of inspection they would check to ensure the safety rules and procedures were being followed by the workers. Although at times there may be a second round of inspection on the same day, that, however, would not be the case normally. In the afternoon they would normally deal with paperwork and documents. When asked in cross-examination how he would become aware of a hazard which arises on site after their first round of inspection, his answer was that he would depend either on the workers reporting or on the supervisors appointed by the subcontractors to oversee safety on site.

12. He was also questioned on the weekly report signed by him but prepared by Uncle Lam in respect of that week in which the accident happened. Under the recommendation column at the end of the report the accident involving the plaintiff was recorded and then the following words were written: "no. of site safety inspection has been increased. Warning to individual has been issued". Mr Fong was unable to say in evidence as to why the number of inspection had been increased nor what warning was issued to whom. According to Mr Fong, at the time he signed the weekly report he had been told by Uncle Lam and was aware of these details asked of him in cross-examination, but he is unable to give these answers now because he has forgotten those details. It also emerged from his answers that when he was asked to make his witness statement in this matter (a statement to which this weekly report was annexed), he did not even take any steps to check from the records what warning was issued and to which individual despite those words appearing in the report.

Findings of Facts

13. In so far as the disputed issues of fact between the two defendants are concerned, I make the following Findings of Fact :

(1) I do not accept the evidence of Chen Chi Shing, the director of the 1st defendant, that there was an oral agreement between the 1st and 2nd defendants to excuse the 1st defendant from providing a safety officer on site before works started on this project. Indeed in the written subcontract between the two defendants, it was expressly provided that the 1st defendant was to provide its own safety officer to supervise safety of its workers on site. Moreover the subcontract provides that all oral negotiations and proposals are to be ignored unless confirmed and approved in writing.

(2) I find that the 1st defendant had failed to provide any safety officers on site and therefore safety supervision of the 1st defendant's workers and employees on site was lacking and was not what it should have been.

(3) I find that the 1st defendant had also failed to provide the plaintiff with the necessary working equipment such as a ladder or even a platform from which he would have been able to reach the fire pipes which he had to paint without having to stand on tip toes reaching far over his head along a staircase which was hazardous in the circumstances. I come to this conclusion on the basis that a person having to reach and to look upwards constantly is put in a position where he can easily lose his balance. This is all the more so where the plaintiff has to do that along a staircase.

(4) Insofar as the 2nd defendant is concerned I find that while there are two safety officers provided by the 2nd defendant on site, the fact that only one of these safety officer would, in the normal course of events, only make one round of inspection some time in the morning, to be insufficient for the 2nd defendant to discharge its common duty of care as an occupier of the site towards all the workers working there. Safety officers are designated for a specific purpose and in order for that purpose to be effective there need to be greater vigilance to ensure safety on site. In the circumstances where work is going on for the whole day, I find it unreasonable for the 2nd defendant to have its safety officer doing only one round of inspection generally for each day.

(5) As for the cause of the accident to the plaintiff, I find that the accident was caused by a combination of both of the following factors. Firstly by the dripping of water, sand and mud from the upper part of the staircase on which the plaintiff was working and secondly by the failure of the 1st defendant to provide proper working equipment to the plaintiff. On that basis, both the 1stand 2nd defendants were negligent towards the plaintiff in causing the accident to happen.

Contractual indemnity

14. Quite apart from the normal apportionment for negligence and or breach of duty the 2nd defendant also rely upon the contractual terms contained in the subcontract between itself and the 1st defendant for a full indemnity by the 1st defendant for any damages which the 2nd defendant may be found liable for towards the plaintiff.

15. The 1st defendant's answer to this part of the 2nd defendant's claim against it is that none of the contractual terms relied upon by the 2nd defendant is wide enough to exempt the 2nd defendant or to make it such that the 1st defendant is obligated to indemnify the 2nd defendant because none of the terms relied upon by the 2nd defendant covers the situation where the 2nd defendant was itself also negligent. In this respect, the 2nd defendant seeks to rely on the decision by the House of Lords in the case of Smith v. South Wales Switchgear Co. Ltd [1978] 1 WLR 165 in which the House of Lords applied the test laid down in Canada Steamship Co Ltd v. The King [1952] AC 192.

16. The 2nd defendant seeks to rely on Article 3, 13 and 14 of the written subcontract agreement dated 8 January 1990 between the 1st and 2nd defendants in respect of its claim for contractual indemnity.

17. The relevant parts of those articles are as follows :

"Article 3 (7)

the Subcontractor (i.e. the 1st defendant) shall be afforded the opportunity to read and note the provisions of the Main Contract.... and shall be deemed to have full knowledge of such provisions,...and shall observe and comply with all the provisions of the Main Contract on the part of the Contractor (i.e. the 2nd defendant) to be observed, ... and indemnify and save harmless the Contractor against and from:-

(a) ....

(b) any act or omission of the Subcontractor, his employees or agents which involves the Contractor in any liability to any person under the Main Contract; and

(c) any claim, damage, loss or expenses due to or resulting from any negligence or breach of duty on the part of the Subcontractor, his employees or agents; and

(d) any loss, damages or compensation payable at law under any statute in force for the time being in respect or in consequence of any accident or injury to any workman or other person in the employment of the Subcontractor arising out of or in the course of his employment."

"Article 13

(1) the Subcontractor shall take all necessary precautions to protect all his own, the Contractor's and all third parties and personnel from all damage and injury which may result from the execution of the Works. The Subcontractor shall continuously inspect all work, materials and equipment to determine any such conditions and shall be solely responsible for the discovery, determination and correction of any such conditions.

(2) ...

(3) ..."

"Article 14

(1) .....

(2) ....

(3) Damage, Loss to Persons or Property

The Subcontractor hereby assumes entire responsibility for any and all damages, losses or injury of any kind or nature to persons or property caused by or resulting from the execution of the Works provided for in the Subcontract or in connection therewith, and the Subcontractor agrees that the Subcontractor will indemnify and hold harmless the Owner, Main Contractor and Contractor, and any and all of the Owner's, Main Contractor's and Contractor's employees, agents and representative from and against any and all claims, losses, damages, charges or expenses, whether direct or indirect and whether to persons or property, to which the Owner, Main Contractor and Contractor may be put or subjected by reason of any act, action, neglect, omission or default on the part of the Subcontractor or his employees, agents and representative or any of his subcontractor or their employees, agents or representatives."

18. In resolving the dispute between the 1st and 2nd defendants on this issue, my task is to determine the proper construction to be placed on the clauses relied upon by the 2nd defendant. In so doing I bear in mind that a fundamental consideration in the construction of exemption or indemnity clauses, it is inherently improbable that one party to the contract should intend to exempt or indemnify the other party from the consequences of the latter's own negligence. The intention to do so must therefore be made perfectly clear in the clauses relied upon for otherwise the court will conclude that the party to be exempt or indemnify was only to be relieved from liability in respect of damage occasioned by causes other than negligence for which he is answerable.

19. In the present case, none of the Articles relied upon by the 2nd defendant contain any specific words to indicate that the 1st defendant had intended to indemnify the 2nd defendant for any loss damage or claims which arise as a result of negligence on the part of the 2nd defendant, his agents or servants. On the contrary, it is worthy to note that in all the Articles relied upon by the 2nd defendant, the indemnity given by the 1st defendant to the 2nd defendant was in respect of any loss damage or claims against the 2nd defendant arising as a result of any failure, omission, act or neglect on the part of the 1st defendant.

20. Neither is there any other good reason to construe the indemnity clauses in the way contended for by the 2nd defendant. I therefore hold that on a proper construction of the Articles relied upon by the 2nd defendant, there is no intention on the part of the 1^st defendant to indemnify the 2nd defendant for loss and damage which are caused also by the negligence of the 2nd defendant.

21. Having found that the accident to the plaintiff in this case arose as a result of breaches of duty on the part of both the 1st and the 2nd defendants, I have come to the conclusion that none of the Articles relied upon by the 2nd defendant can assist it in its claim for contractual indemnity against the 1st defendant.

Apportionment

22. Having found that the accident to the plaintiff was caused by the breaches of duties of both the 1st and 2nd defendants in that the 1st defendant was in breach of its duties as an employer whilst the 2nd defendant was in breach of its duties as an occupier of the site, I can find little to distinguish between these breaches by the two defendants towards the plaintiff in so far as blameworthiness is concerned. Both defendants had allowed different situations to exist which they were each under a duty to prevent from existing. Therefore their breaches were similar in that they had failed to prevent a certain situation from existing.

23. Without any clear indication that one or other of those breaches was more blameworthy to a significant degree, it is only fair that the apportionment of liability be equally shared between both defendants. Accordingly, I find that both the 1st and 2nd defendants to be equally to blame.

Costs

24. In the circumstances, I shall make a costs order nisi that each defendant to bear its own costs of the contribution proceedings.