GAMMON CONSTRUCTION LTD. v. WONG YAT CHIU AND ANOTHER

HCPI 1289/97

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 1289 OF 1997

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J U D G M E N T

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1. These two matters come before me for joint trial pursuant to orders made by Master Barnett on 14 September 1998 and Master Woolley on 12 February 1999. By the same orders, the trial of both matters was limited to liability only.

2. Counsel for the parties during the course of this hearing have further asked for all matters relating to liability to be determined separately in respect of each action so as to assist any future determination of quantum. The hearing proceeded on that basis.

The Accident

3. Both actions arose out of the same factual background. On 2 March 1995, a contract was signed between Gammon Construction Limited, which is the plaintiff in HCA 7939/97 and is the 2nd Defendant in PI 1289/97 (Gammon) and Fei Kow Transportation Company, which is the 1st Defendant in PI 1289/97 and is the 2nd Defendant in HCA 7939/97 (Fei Kow), for the hire of a truck mounted crane, owned by Fei Kow, to Gammon. The crane was to assist in the handling and transportation of steel framework referred to during the course of the trial as "cages" which were manufactured and stored at a location in Kennedy Town which was under the control of the 3rd Defendant in PI 1289/97, Keir Sun Fook Joint Venture (KSF) and which had been provided by KSF to Gammon for the purposes of the making and storing of the iron cages which were to be used in the construction project in which KSF was a contractor.

4. The crane was driven and operated by Wong Yat Chiu who is the Plaintiff in PI 1289/97 and the 1st Defendant in HCA 7939/97 (Wong).

5. The crane had arrived at the Kennedy Town site in early June of 1995 and for some days had been loading and transporting steel cages without incident.

6. At the site, a number of Gammon workers would attach the steel cage to be lifted to the crane arm by way of metal lifting wires referred to as a "sling" throughout the trial. The metal sling was provided by Gammon. The crane would then lift the cage and deposit it on the tray of the truck.

7. When the crane truck first arrived at the site in June, it had on its tray three canvas slings. Because the wire sling provided by Gammon had to be detached from each cage after that cage was deposited on the back of the truck so as to be re-attached to the next cage to be lifted, it was thought a day or so prior to the 24th June that using the canvas slings on the back of the truck in addition to the metal or wire sling would speed up the operation.

8. Who precisely decided to use these canvas slings and whether their use was agreed to or not by Wong, the driver and the operator of the crane truck, were two issues which arose in both actions. Nevertheless, about two days prior to the accident, those canvas slings were co-oped into use in lifting the steel cages.

9. The operation proceeded by way of Gammon workers rigging the canvas slings to the steel cages and crane and Wong then lifting the cages onto the truck by way of operating the crane control.

10. During the course of the lifting operations on 24th June, two of the three canvas slings used to lift a particular cage broke when the cage was being lifted by the crane onto the truck. At the time the slings broke, the cage was nearly over the truck and when it fell, it killed a Nepalese worker of Gammon who was standing under it or nearby it and injured another. It injured also Wong, the operator of the crane who was at the back of the tray of the truck where the crane controls were located.

The Pleadings

11. By way of his Statement of Claim in PI 1289/97, Wong claims as against Fei Kow that it was negligent in providing uncertified and uninspected and unmarked canvas slings. Wong further claims that Fei Kow was in breach of various statutory duties in regard to the canvas slings and in failing to provide a safe system of work in breach of the Lifting Appliances and Lifting Gear Regulations to Cap. 59 and of section 6A thereof. Further or in the alternative, Wong alleges that the negligence and breach of statutory duties of Fei Kow as pleaded were in breach of the implied terms of the contract of employment of Wong with Fei Kow.

12. This breach of implied terms of his contract as pleaded, was abandoned by Miss LEE at the end of the trial. Further, the original claim as pleaded as to occupier's liability against Gammon and KSF was also abandoned by Miss Lee.

13. Wong's claim as against both Gammon and KSF alleges that they failed to provide a safe system and place of work. It further alleges a breach of statutory duties on the part of both Gammon and KSF regarding the use of the canvas slings.

14. All Defendant's by their Defences allege contributory negligence on the part of Wong in using the canvas slings and operating the crane. Gammons defence as to both Fei Kow and Wong being in breach of contract was abandoned during trial so far as PI 1289/97 was concerned.

15. Notices of Contribution pursuant to O. 16 r. 8 were served by Fei Kow on Gammon and KSF, and by Gammon and KSF on Fei Kow.

16. So far as HCA 7939/97 is concerned Gammon as against both Wong and Fei Kow seeks indemnity pursuant to s. 25 of the Employees Compensation Ordinance Cap 282 for sums paid to its injured and deceased workers and other sums, and as against Fei Kow indemnity in respect of the same monies pursuant to the terms of the contract for the hire of the crane and pursuant to implied terms pleaded as being in that contract. In other words as against Fei Kow Gammons claim is one of statutory and contractual indemnification for liabilities it incurred as a result of the accident and as damages under the contract.

17. Gammon, by its claim against Wong pursuant to s. 25 Cap. 282 alleges negligence on his part in the use of the canvas slings and further that he maneuvered the crane so that it passed over the deceased and injured Gammon workers. Gammon alleges also against Wong that he was in breach of statutory duties pursuant to the same Lifting Appliances and Lifting Gear Regulations to Cap. 59. I should add the Gammon Statement of Claim also alleged that Wong was liable to it for breach of contract and liable to indemnify it pursuant to the conditions of that contract of hire of the crane, but that contractual claim was abandoned by Gammon at the end of the trial.

18. As against Fei Kow, Gammon alleges breach of the terms of the contract between them by way of Fei Kow supplying unsuitable canvas slings as accessories to the hired crane truck and by Fei Kow failing to inspect the canvas slings before their use and further relies upon various conditions of the contract for hire of the crane in seeking indemnification.

19. Gammon alleges also that Fei Kow was negligent for the purposes of s. 25 of Cap. 282 in that it, inter alia, provided the canvas slings and allowed them to be used; and further, that Fei Kow, by its servant negligently maneuvered the crane. Gammon further claims that Fei Kow was in breach of statutory duties imposed upon it by the same Regulations to Cap. 59.

20. Wong and Fei Kow defend Gammon's claim pursuant to s. 25 of Cap. 282 by way of reliance on Gammons contributory negligence and breach of statutory duty.

21. Fei Kow alleges Gammon was in breach of the contract between them and further that the contract by its terms provides no indemnification to Gammon.

22. In respect of Gammon's claim, Fei Kow had served a Notice of Contribution upon Wong pursuant to O. 16 r. 8 of the Rules of the Supreme Court, but during the course of this hearing Mr Lau who appeared for Fei Kow in HCA 7939/97 informed me that he no longer relied upon that notice and withdrew it.

The evidence and issues

23. I will deal now with the evidence and issues of fact so far as both matters are concerned. Wong the crane driver gave evidence himself and called a Government Factory Inspector Mr Ho Ho Leung.

24. Fei Kow called Mr Chan Kwok Wan, one of the two proprietors of Fei Kow, and Gammon called Mr Francis Sin, a Senior Safety Officer, and Tsang Kwong Shu, a ganger, who acted as the senior workman or foreman at the Gammon site on the day of the accident.

25. Much of the evidence was common ground. There was no dispute that, pursuant to the contract of hire, Wong had taken his crane truck to the Gammon and KSF compound at Kennedy Town where Gammon manufactured and stored tubular iron "cages" for the purposes of a construction project KSF and Gammon were involved with.

26. Nepalese workers at the site attached, initially, a Gammon wire sling to the cages and crane hook for them to be lifted by Wong, operating the crane controls, onto the truck.

27. There was no issue either that about 2 days prior to the accident the Nepalese workers had commenced to use the canvas slings which had been aboard Wong's truck. But there issue was joined as to how that came about and to what extent the use of the canvas slings had caused the accident.

28. Wong said those slings had been on his truck since he had started driving it some two months earlier and had been used to lift light loads only. He said when the Gammon workers had first approached him to use those slings, he had protested and said that they were very dangerous if used to lift the cages. But that Cheung Pak-on, one of the workers had said that if they were broken then his company Gammon would pay for them. Other Gammon workers on the site had also agreed that compensation would be paid if the canvas slings were broken and Tsang Kwong-shu, the senior worker or ganger who was acting as the foreman for Gammon at the site had agreed.

29. Wong said that he was aware of the possibility of the slings breaking and causing injury and that was why he had protested against their use.

30. He said the canvas slings condition had been normal and they had not shown much wear prior to being used by the Gammon workers but that after they had been used, they did show some damage.

31. He said that over the approximately two days of their use, he did not check the slings. He said that as they were old slings, they could carry about 2 1/2 tons each and he was aware that the cages weighed about 2 1/2 tons. He said after the slings had been taken for use by the Gammon workers against his protest, he had nevertheless not stopped the crane as he did not want to have a dispute.

32. So far as the worker who was killed and the worker who was injured were concerned, he said he did not know that they had been under the crane at the time the slings broke as he had been looking up at the load itself. During the course of the two days or so that the canvas slings had been used by the Gammon workers, the cages had been rigged to the slings and to the arm of the crane by the Gammon workers including Tsang. Prior to operating the crane, he had, in the beginning of the operation, warned the Gammon workers on or nearby the truck to stay clear when the load was lifted. He said the reason he had been under the load at the time the slings broke was that he had been at the back of the truck operating the controls and had had to stay on the side of the truck over which the load was carried because, albeit there were dual controls on the other side of the truck, he was unable to stand there due to the obstructions caused by other material on that side.

33. He said that at all times Gammon was responsible for giving him instructions at the site as to how the work was to be done.

34. Mr Ho Ho Leung was a Factory Inspector who compiled an accident report relating to this matter. He had attended the site for the purposes of investigating this accident on the 26 June 1995 and at the site had inspected the canvas slings used to lift the cages at the time of the accident. He found upon inspection of the three canvas slings that they were in a worn condition and had not been marked with any safe working load.

35. He was qualified as an expert at the commencement of his evidence and it was agreed by all parties that his report dated 9 November 1995 stand as his evidence in chief.

36. He was able to say also that the method of rigging the three canvas slings brought about their breakage. The method of rigging used had involved the two shorter slings being attached to the steel cage and the longer sling then being run through the eyes of those two shorter slings and the two ends of the longer sling then being attached to the crane arm. That meant effectively that where the longer sling ran through the two eyes of the shorter slings, there was direct contact between the canvas of the slings.

37. Mr Ho's opinion was that this direct contact between the longer sling and the eyes of the two shorter slings had brought about abrasion which eventually resulted, given the loading upon them, in the tearing of the eyes of the two shorter slings, so that the load fell.

38. He said factors which contributed to the tearing of the eyes of the two shorter slings included their inclination at 45 degrees to the load they were carrying. That inclination increased the loading on each of the shorter canvas slings which together with the method of rigging the longer canvas sling through the eyes of the two shorter slings induced a considerable side pull of forces acting on the eyes of the two shorter slings. In his view, the side pull would have acted together with the canvas to canvas abrasion to overload the edges of the eyes of the slings and so tear the eyes.

39. Mr Chan Kwok Wan, one of the two partners of Fei Kow, gave evidence.

40. He agreed that the Agreement for Hire of the truck crane had been signed between Fei Kow and Gammon for the purposes of Fei Kow hiring the truck crane to Gammon but said that the canvas slings formed no part of the equipment subject to hire under that contract. He said Fei Kow had had a long working relationship with Gammon going back more than 20 years and this occasion had been the first time over that period that Gammon had used Fei Kow slings.

41. He said he personally checked the equipment on the truck crane every week and had indeed inspected the canvas slings. He agreed that no certificate was current in respect of the slings but that they had appeared to be in satisfactory condition to him. There was no safe working load marked upon the canvas slings but he had told Wong the safe working load of the slings was three tons each, and that they were to be used for round, that is not sharp, objects only. He said Wong in allowing the slings to be used for the purposes of lifting the cages had acted contrary to his instructions but that he accepted that, in the circumstances of the work site, Wong had had no real choice but to follow the directions of whoever was in charge of the Gammon workers there. He said so far as the contract of hire was concerned Gammon would not tell Fei Kow what work was to be performed by the hired equipment, but would simply specify what equipment they wanted. He said 70% of Fei Kow's business was with Gammon.

42. That concluded the evidence called on behalf of Wong and Fei Kow in respect of both actions.

43. Mr Francis Sin gave evidence for Gammon. He was a Senior Safety Officer at that company and was indeed the Safety Officer for the Kennedy Town site at the time of the accident. He said that only larger sites had full time Safety Officers and that because the Kennedy Town site was basically a storage area he had not been there at all times but went there about once a week for an inspection. The Kennedy Town site did have a foreman in charge but that foreman also spent only part of his time at the site and spent a larger part of his time at the company's Central site relating to the same project. Accordingly, the person in charge of the site in the absence of the foreman was Tsang Kwong Shu who was a ganger or senior worker at the site. He said that Tsang had been given at least one safety training course and on at least one occasion on the 13 May 1994, at a course, had been provided with a Gammon safety document called "A Rigging Handbook". He said that handbook instructs Gammon workers that the use of non-Gammon approved slings was prohibited for the purposes of lifting operations. That handbook also stated that slings without safe working loads marked upon them should not be used.

44. He said that there was no record of any Nepalese workers present at the site and who had assisted in the lifting operations of the cages at the site having ever been provided with any training in rigging methods.

45. He said he had seen the canvas slings and they were in generally good condition. In his view, those slings could have lifted up to three tons but that if they were to be used to lift any heavy load, shackles should have been inserted at the eyes of each of the shorter slings through which the larger sling could then have been run so as to avoid canvas to canvas contact and the risk of abrasion. He said the use of shackles had been part of the safety course given to Tsang and that Tsang should have instructed the site workers on the safety aspects of rigging the cages.

46. Tsang Kwong Shu also gave evidence. He was the senior worker at the site employed by Gammon. By occupation, he was a driller. But as the senior worker present at the site, he was in charge in the absence of the site foreman, a Mr Ho.

47. He said he had attended a safety course or courses though he did not remember the particular course or courses or whether they dealt with rigging. He did read handbooks provided by Gammon but he could not remember whether the particular handbook produced to him in the course of his evidence which referred to rigging was the handbook he had read.

48. He agreed that it was Gammon's policy that lifting slings were required to be obtained from Gammon itself and any slings used for the purposes of lifting loads were required to have the safe working load marked upon them. He also agreed that he was aware that shackles were supposed to be used to connect slings. On the occasion of the lifting of the cages onto the truck supplied by Fei Kow and driven and operated by Wong he had instructed the Gammon workers on the lifting operations and had then left them to carry on. He did not tell them about the Gammon guidelines on using slings and he did not know if the Nepalese workers who continued to rig the slings were knowledgeable about rigging. He was aware that canvas slings at some stage had commenced to be used and he was aware that they were not Gammon slings. He did not ask for any certificate as to the inspection of the slings but allowed their use to continue as it was convenient and faster than only using the single Gammon wire sling.

49. He initially said in evidence that it was only after the accident on the 24 June that he came to know that the canvas slings had been used on that day. He then agreed that in previous proceedings he had told the magistrate that he had actually assisted in fitting the canvas slings on the day of the accident, whereas he had said in this trial that he had not participated in the fitting of the canvas slings on the day of the accident. He later admitted he said this so as to avoid being thought to be involved in some way in the accident. In other words, he agreed that he had deliberately given false evidence in this trial in respect of that particular matter.

50. He said he was unaware who had taken the canvas slings from the Fei Kow lorry crane but agreed he allowed them to be used and presumed that they were strong enough, otherwise Wong, the operator of the crane, would have warned him against their use. He said that in fact Wong never complained or protested about the use of the slings and he denied that there was any conversation, as Wong had said in his evidence, concerning compensation if the slings broke during the course of their use to lift the cages.

51. He had seen the canvas slings some two or three days before the accident. He said they looked "new, thick and wide". He said on the day of the accident, he was unaware how the cage had been rigged to the slings and did not know the configuration of the canvas slings used in lifting the steel cage nor did he know that three slings were used until the accident.

52. Subsequently, after having been again presented with the contents of his earlier statement he remembered in fact he had taken part in rigging the slings and was aware that there were three slings used. He agreed that after the first few days of the lifting operation, he had not supervised the workers in the course of the operation.

53. He said the canvas slings had been used for two to three days prior to the accident and over that period of time had been used five to ten times to lift iron cages onto the lorry crane operated by Wong. He reiterated in his evidence a number of times that he thought the use of the canvas slings were safe otherwise Wong, the driver and operator of the lorry crane, would have warned him against their use.

Assessment of witnesses and evidence

54. In my view, with the exception of Tsang, all witnesses generally attempted to give truthful and accurate evidence. Mr Tsang struck me as being a witness who was anxious to minimise his own role in this accident and to pass blame onto others.

55. Wong, in his evidence, was quite candid. He agreed, for example, that he had not been looking at the workers under the load at the time of the accident and had not seen that they were therefore not standing clear from the load because he had been looking up at the load itself. He agreed also quite candidly that he was aware of the possibility of the canvas slings breaking and causing injury. He agreed that although the condition of the slings had been normal at the commencement of the operation that they had sustained some damage during the course of the two days prior to the accident.

56. His evidence in terms of the safe working load of the slings was consistent with other evidence in that regard. He estimated that new canvas slings of that sort could be used to lift three tons but that as these slings were slightly worn they were each safe for approximately 21/2 tons. He was aware as he said in his evidence that in fact the cages weighed 21/2 tons.

57. Wong's evidence had the ring of truth about it. He said the reason that he had not stopped the operation even though he was aware the use of the slings was dangerous was that he did not want to have a dispute with the Gammon workers. He said in his evidence that he was one person "and what chance did one person have on the work site to insist upon his point of view" or words to that effect. He did not try to exaggerate other's roles or minimise his own. It seems to me that on balance he was expressing the facts of the accident as accurately as he could in his evidence.

58. So far as Ho Ho Leung is concerned, I accept him as a reliable witness also, indeed all parties relied upon his evidence and at no stage was his evidence put in material issue. He was qualified and accepted by me as an expert in the field of lifting operations using cranes and the associated methods of rigging in the course of those lifting operations.

59. So far as Mr Chan Kwok Wan's evidence is concerned, the Fei Kow co-proprietor, I accept him as a witness of truth also. He gave his evidence in a frank and direct way. He also was quite candid at times in the course of his evidence. He agreed that the slings did not have any safe working load marked upon them and that Regulation 18(e) of the relevant regulations to the Factories and Industrial Undertakings Ordinance also had not been complied with as regards the inspection of the canvas slings.

60. I accept from his evidence that he told Wong that the safe working load of each sling was approximately three tons. That agrees approximately with Wong's evidence as to what he thought the safe working load of the slings was.

61. I accept also his evidence that Wong was told by him that the slings should only be used for round objects with no sharp edges. Chan said that Wong acted contrary to his instructions in allowing the slings to be used for these cages but that Wong had been forced to because at the site, contractually, Wong was under the control of Gammon.

62. I accept also as a witness of truth, Francis Sin, the Safety Officer at Gammon responsible for the site at Kennedy Town. It seems to me that he attempted to give full and complete evidence. He did not evade questions. He agreed on occasion with matters apparently against his or his employer's interest. For example, he agreed that shackles should have been used at the eyes of the two lower slings to prevent canvas to canvas contact. He agreed also that Gammon workers had been instructed to use shackles in that regard and that Tsang had attended a course of safety in which the use of shackles had been part of the instruction.

63. In his view, the canvas slings, which he had seen, which had been used at the time of the accident, were in generally good condition. He thought from their appearance that they could lift something up to three tons.

64. I accept from Mr Sin's evidence that Mr Tsang was in breach of Gammon policy and the instructions indeed given to Mr Tsang at the safety course conducted by Mr Sin that in using canvas slings shackles should be used. I accept also from Mr Sin's evidence that the foreman Ho who apparently attended the Kennedy Town site for a few hours each day would have been aware that the canvas slings had been used.

65. I am satisfied from his own evidence and from the evidence in the case generally that it was not Wong's idea to use the canvas slings in conjunction with the wire slings so as to speed up the operation. Wong would have no reason, on the evidence, to wish to speed up the lifting operation. He was paid a daily rate by Fei Kow and was not on a fixed amount per job basis. There was no reason for him to wish to hurry up the completion of the work on the face of the evidence presented. There was particularly no reason for him to attempt to speed up the lifting operation by using slings the use of which I accept he thought to be dangerous in the circumstances.

66. In my view the probabilities are that Gammon workers initiated the use of the canvas slings found in the back of Wong's truck for the purposes of speeding up the lifting operation. This is particularly so as I accept from Mr Sin's evidence that Gammon had shortly to vacate the Kennedy Town site as KSF which had lent it to them wished to have it back.

67. On the evidence the Gammon workers had reason to hasten the lifting operations by using the canvas slings.

P.I. 1289/97

68. I will now deal more particularly with PI 1289/97 and the issues relating thereto.

Wongs claim against Gammon

69. Having considered all of the evidence I am not satisfied that the use of canvas slings was of itself a cause of the accident. In my view given the evidence of Mr HO, the Factory Inspector, and Francis SIN, the Gammon Safety Officer, the particular method of rigging used at the time of the accident was the cause of the failure of the slings.

70. It may well be that it was inadvisable, as the Factory Inspector Mr HO said in evidence, to use canvas slings instead of wire slings but there was no evidence called before me to suggest that, had the canvas slings been rigged properly, using shackles at their points of contact, and at angles commensurate with the avoiding of any sideways shearing action on the eyes of the two lower slings, that they would likely have failed in any event.

71. To the contrary, the whole of the evidence as to the cause of the failure of the canvas slings was to the effect that it was the defective method of rigging used which was the effective cause, but for which the eyes of the canvas slings would not have torn. From the evidence before me the weight of the cages was within the carrying capacity of the three slings taken together.

72. Indeed the evidence of Mr Ho was explicit in stating that in his view the eyes of the two lower slings tore, not because of tension or load on the slings, but because of the abrasion of canvas to canvas contact at the eyes of the two lower slings which was enhanced in its destructive effect by the sideways pressure and additional loading brought about by the acuteness of the angle at which the lower slings were to the upper sling passing through their eyes.

73. Further I accept from the evidence of Wong and indeed, in this regard, of Tsang, that the Gammon workers were responsible for rigging the slings for lifting the steel cages and had devised, either with Tsang, or without supervision by themselves, the particular configuration of the slings which was used. That in any event accords, in my view, with the realities of a lifting operation of this sort, and in this regard Wong was not involved.

74. I accept from Wong's evidence that he warned the Gammon workers, including Tsang the ganger, that the use of canvas slings rather than wire slings was dangerous.

75. I reject Tsang's evidence in this regard that no such warning was given. Wong's evidence as to the course of the conversations at the time of this warning in my view had the ring of truth. I think it unlikely he fabricated conversations of this detail though I accept he may have been as concerned with possible financial loss brought about by damage to the slings as with the risk of personal injury to any person. Nevertheless, I accept some such warning was given to Tsang as to use of the canvas slings being dangerous.

76. In my view, Tsangs allowing the use of the slings by the Gammon workers under his control in the face of Wongs warning whilst not of itself being the cause of the accident must have alerted him to the need for close and careful supervision of the rigging of the slings to the iron cages.

77. His or the Gammon workers failure to at least use shackles at the eyes of the lower slings, having, as he said in his own evidence, and as said by Francis Sin the Gammon safety officer in his evidence, been made aware of the need for the use of shackles in such circumstances, amounts in my view, given the rigging method employed, to a breach of a duty of care to the workers at the site, including Wong.

78. That duty of care, so far as it extended to Wong, was owed by Gammon and Gammon is vicariously liable to Wong being the employer of Tsang and the Nepalese workers all or some of whom rigged the canvas slings in the configuration which caused the eyes to fail.

79. In my view, it should have been foreseeable by Tsang that rigging the canvas slings in that way, without shackles, risked failure of the eyes.

80. Further, in my view, from Tsang's evidence as supported by Wong Gammon had failed to properly supervise the rigging operation either by Tsang so far as he was in charge of the operation or by the foreman Ho so far as he was aware that the lifting operation was proceeding, and failed also to provide proper training to the Nepalese workers, who according to both Wong and Tsang participated in the rigging of the canvas slings. I accept in this regard the evidence of Francis Sin who agreed there was no record of the Nepalese workers at the site receiving any safety instructions relating to the proper rigging of loads lifted by slings and that records were kept of workers who attended such courses. In my view given the absence of such records and the Nepalese workers difficulties with Punti the probabilities are no such training was given.

81. Accordingly as against Gammon I find that Wong has made out his claims in negligence pursuant to particulars (i), (ii), (iv), (ix), (xiv), (xvi), (xvii) & (xviii) in the Statement of Claim. So far as Wong's claim against Gammon for breach of statutory duty is concerned section 19 of Cap. 59 prevents Wong relying on a breach of s. 6A as pleaded. My findings of negligence in any event render that claim otiose.

82. I have considered also whether the statutory duty of an owner to inspect lifting gear prior to its use on each occasion pursuant to s. 18(ea) of the Regulations has been established against Gammon by Wong. In my view it has. Gammons failure to rig the lifting gear properly allowed abrasion at the eyes and eventual failure to occur. Abrasion is a gradual process. In my view the probabilities are that if the lifting gear had been inspected by a competent person prior to its use on the occasion of the 24th June it would have been likely that some wear due to the rigging method would have been detected. Gammon is an "owner" of the lifting gear at least on the basis of it having through Tsang and its servants control or management of the canvas slings. Accordingly particular (iii) of the particulars of breach of statutory duty alleged against Gammon is made out as to its breach of Regulation 18(ea).

Wongs claim against KSF

83. So far as Wong's claim against KSF is concerned, Counsel who appeared for both Gammon and KSF in these proceedings conceded that in the event I found against Gammon, as I have done, then both on the law and facts of this case Wong's claim against KSF must also succeed.

84. In my view KSF as the principal contractor on the site, who still exercised some control over the site as I accept from the evidence of Francis Sin, were negligent as regards particulars (i), (iii) & (iv) as pleaded against them in Wong's claim. They had a responsibility to ensure that the system of work adopted on their site was safe and for the reasons I have given it was not. Further, so far as regards the allegation of breach of their statutory duties is concerned I am satisfied that the same particular (iii) as to the breach of Regulation 18(ea) has been made out.

Wongs claim against Fei Kow

85. So far as Wong's claim against Fei Kow is concerned I accept Miss LEE's argument on behalf of Wong that Fei Kow, in the circumstances of this case where Wong, a skilled worker, was instructed from day to day as to which site to attend, which evidence I accept from Wong and Chan Kwok Wan his employer, cannot say that its duty to provide a safe system of work for Wong was delegated to Gammon or KSF.

86. In my view, on the facts that I found, the failure to properly supervise or train the Gammon workers was a systemic and ongoing failure at the site predating, and concurrent with, the period of time Wong was working there. In allowing Wong to work in a system which it had left in the hands of Gammon and which was defective in the proper supervision and training of workers Fei Kow was in breach of its duty to Wong to provide a safe system of work. Wong succeeds in his claim against Fei Kow on that basis and Wong has made out his claim in negligence so far as particulars (i), (vii) and (viii) are concerned and has established Fei Kow's breach of statutory duty so far as particular (iii) thereof is concerned.

87. In coming to these conclusions I considered carefully whether the state of the canvas slings was in itself a cause of the accident.

88. Apart from the breach by Gammon of Regulation 18(ea) there was no evidence that any inherent defect in the slings, or other wear of the slings over time caused the eyes to fail. Accordingly in the absence of such evidence in my view there is no basis for finding that any other breach of Regulation 18 of the Lifting Appliances and Lifting Gear Regulations to Cap. 59 was causative of the failure of the eyes. Both eyes of the two slings failed at virtually the same time. It seems to me that the probabilities are that that was not a coincidence and that as I have set out above their failure was due to the method of rigging at the site. I do not think the evidence can go further than that without indulging in speculation. Particularly there is no evidence that the canvas slings failed due to any excessive load placed upon them or due to any excessive wear preexisting the accident. In any event all of the evidence given at trial as to the weight the slings could bear suggests that they were probably able to comfortably sustain the weight of the cages. Apart from the evidence of Ho Ho Leung, that of Chan Kwok Wan and Wong was that the slings were in reasonable condition. That was also the evidence of Francis Sin. Tsang, whose evidence I discount, said they were in good condition. Mr Ho saw the slings, as did Francis Sin only after the accident. Even if they were worn, there is no evidence that wear contributed to the failure of the eyes.

89. If the canvas slings failure was not attributable to their being unable to bear the weight of the cage or of any worn state or structural defect, then apart from Regulation 18(ea) any other breach of Regulation 18 becomes irrelevant.

90. For that reason the use of slings which were in breach of other provisions of Regulation 18 is insufficient to establish liability on anyone's part.

91. The next question is regarding the defences raised of Wong's contributory negligence and breach of statutory duties.

Contributory Negligence

92. So far as the rigging of the slings is concerned, I accept that Wong, in the system of work devised by Gammon, was not responsible for the rigging of the cages to his crane.

93. The unchallenged evidence was that the rigging was carried out by the Gammon workers over the other side of a fence from where Wong was operating his truck crane. The system of rigging the slings was Gammons and in my view, the individuals immediately and solely responsible for the rigging process were the Gammon workers. It may well have been that given Wong's occupation he had some experience in rigging loads onto his crane. But he was entitled to assume that Gammon had provided workers to do that particular job who were competent to do it and who would do it properly. That included their inspecting the slings and providing a competent person to do so before their use.

94. There was nothing advanced in evidence to suggest Wong should have been alerted to the Gammon workers failure to put shackles into the eyes of the lower slings or that the particular rigging configuration given that failure was unsatisfactory.

95. It is true Wong had himself alerted the Gammon workers to the fact that use of the canvas slings was dangerous. He said in evidence this was because they were more liable to break than were wire slings. That may well have been true. They were susceptible to damage from sharp edges and required, perhaps, more careful rigging.

96. There was nothing to suggest that Wong's general concern as to the use of canvas slings extended beyond an understanding that they should not be used for sharp loads, as the cages were, or were more prone to break. The cause of the failure was the method of rigging used. As I have said there was no evidence that Wong's concerns as to the dangers of canvas slings extended to any foresight of the failure of the particular method of rigging used. I am satisfied he was entitled to assume that the Gammon workers had properly rigged the slings.

97. Further, Wong was obliged to work to the direction of Gammon. Once he had brought to the attention of Gammon that use of the slings may be dangerous and Gammon had insisted on using them anyway he had done enough in that regard. He was not required to himself adopt a supervisory role regarding the rigging of the slings by the Gammon workers or oversee the Gammon system of work.

98. The Defendants allegations of contributory negligence against Wong so far as his simply allowing the use of the slings cannot succeed.

99. However, in the course of maneuvering the relevant load I accept that Wong had allowed it to pass over, or close to the injured and deceased Gammon workers and himself. He said he was looking up at the load rather than where the workers were. I accept he had warned the Gammon workers in the vicinity at the commencement of the operation that they should avoid being under the path of loads raised by the truck crane. Its true Wong was the operator of the crane and had a duty of care in its operation. But that duty has to be placed in the perspective of the system of work at the Gammon site. Wong, as I have found, protested the use of the canvas slings and informed the Gammon workers their use was dangerous. Nevertheless Gammon, through its servants and Tsang the effective foreman at the site insisted on using the slings.

100. Wong allowed the load carried by the slings to pass over or near himself and the Gammon workers. It is said on Gammon's and KSF's behalf that in choosing to do so he was negligent.

101. But the reason why Wong could not avoid passing the load over his own head was that the other side of the truck, where dual controls were located was obstructed by the previous load placed on that side of the truck. It can be seen by the photographs agreed in this case that the previous iron cage placed on that side of the truck was so long that it lay over the dual control position. The cages were a standard size. Accordingly after loading the first cage Wong had little choice but to remain on the right hand side of his truck throughout the loading of the second cage. The equipment he was using and the nature of the load it was to carry meant that Wong had little choice but to conduct the loading operation for the second cage in the way he did.

102. In Machray v. Stewarts & Lloyds (1964) 3 All.E.R. 716 and General Cleaning Contractors v. Christmas (1953) A.C. 180 the employees assumption of risk in the way he performed his work did not result in findings of contributory negligence where the employee was effectively operating within the parameters of a risk situation brought about, not as a result of his own capricious risk taking or decision making in an area he was inherently responsible for, but by the exigencies of the nature and circumstances of the task he had to perform.

103. I am satisfied that Wong was aware that use of the canvas slings could bring about a risk of injury. But I am satisfied also that the taking of that risk of suspending the load in the vicinity of himself and other workers was brought about by the circumstances of the lifting operation.

104. So far as the deceased and injured Gammon workers are concerned I accept Wong had warned them of the dangers of standing under the load. Here, where Wong was looking up at the load as it was overhead his truck and himself, I do not think he at that time was responsible for supervising the Gammon workers who were in the vicinity of the truck and who had apparently been themselves responsible for controlling the load as it was suspended from the crane by using guide ropes. I bear in mind that at this time, from the photographs Wong had suspended the load over its eventual resting place on the truck. Whether the deceased or injured workers were actually under the load or simply near-by it at that time was not adduced in evidence.

105. Wong was entitled to assume the Gammon workers would, at the stage the load was over the truck, do their job properly and stay out from under the load. The position may well have been different if the load had been transported gratuitously over the head of workers unaware of its presence. In my view contributory negligence on the part of Wong has not been made out.

106. Accordingly judgment on liability to Wong against the Defendants.

Apportionment between the Defendants

107. The final question so far as PI 1289/97 is concerned is the question of contribution between the Defendant's.

108. It has been urged upon me that as between Fei Kow on the one hand and Gammon and KSF on the other the only blameworthiness is that of Gammon and KSF.

109. Mr Sakhrani for Fei Kow has urged upon me that so far as the apportionment of blame amongst the Defendant's is concerned, Gammon must be solely liable. With this, I agree. The only culpability on the part of Fei Kow, on my findings, is its failure to provide a safe system and proper supervision for Wong's work.

110. As against Wong that duty is not delegable. But so far as Fei Kow and Gammon and KSF are concerned, Fei Kow handed over responsibility for Wong in that regard to Gammon and KSF.

111. On the Kennedy Town site, Wong was under the direction of Gammon. Neither he nor Fei Kow had any practical way of ensuring that Gammon's internal supervision and training of its on site workers was adequate. Fei Kow was entirely in the hands of Gammon and KSF in this regard. In my view, as between the Defendants, Gammon and KSF must bear all of the responsibility. It is difficult to see what practical steps Fei Kow could have taken to improve the Gammon system of work. Fei Kow would have little realistic way of assessing the competence of the Gammon workers involved in the rigging operation. It was wholly in the hands of Gammon in this regard as it was in regard to the nature of the materials to be loaded. Accordingly I apportion 100% of the blame equally to Gammon and KSF as between the Defendants'.

HCA 7939/97

112. I turn now to H.C.A. 7939/97 to which the above findings of fact also apply.

113. Gammons claim against both Wong and Fei Kow is one of indemnity for the monies it has paid out as a result of the accident.

114. The claim for indemnity is made, pursuant to paragraph 13 of the statement of claim against both Wong and Fei Kow by way of section 25(1)(b) of the Employees Compensation Ordinance Cap. 282 and against Fei Kow pursuant to Clauses 5, 11 & 12 of the Agreement for hire of the truck crane.

115. Further pursuant to paragraph 13A of its claim Gammon seeks damages against Fei Kow but restricted to those particularised in paragraph 12 of its Statement of Claim which effectively still means it is seeking indemnity for compensation monies it has paid out on the principle of Mowbray v. Merryweather (1895) 2 Q.B. 640.

Gammons claim against Wong and Fei Kow pursuant to section 25

116. As a result of my findings of fact no negligence or breach of statutory duty is attached to any third party for the purposes of section 25(1) of Cap. 282.

117. Nevertheless the matter of the applicability of section 25(1)(b) was extensively argued before me and out of deference to counsels arguments I will set out my findings.

118. Pursuant to s. 25(1) Gammon sought to recover against both Fei Kow and Wong as third party tortfeasors the compensation it had paid to its deceased and injured workers.

119. The question of the ability of an employer, such as Gammon, who is at least partly to blame for the circumstances of the workers injury to recover from a third party tortfeasor was the essence of this argument before me.

120. In Cory & Son v. France (1911) 1 K.B. 114 the Court of Appeal held that the equivalent English Legislation pursuant to s. 6 of the Workmans Compensation Act 1906 would not operate to allow a tortfeasor employer recover an indemnity from another person who was also a tortfeasor in respect of the same matter.

121. Section 25 says:-

"(1) Where the injury in respect of which compensation is payable was caused in circumstances creating a legal liability in some person other than the employer (in this section referred to as the third party) to pay damages to the employee in respect thereof -

(b) the employer by whom compensation is payable, and any person who may be called upon to pay an indemnity under section 24 in the case of an employee employed by a sub-contractor, shall have a right of action against the third party for the recovery of any sum which he is obliged to pay as a result of the accident, whether by way of compensation or indemnity or by virtue of any agreement made with the employee prior to the accident."

122. The equivalent English legislation before the court in Cory v. France was:

"Where the injury for which compensation is payable under this Act was caused under circumstances creating a legal liability in some person other than the employer to pay damages in respect thereof -

(2.) if the workman has recovered compensation under this Act, the person by whom the compensation was paid, and any person who has been called on to pay an indemnity under the section of this Act relating to sub-contracting, shall be entitled to be indemnified by the person so liable to pay damages as aforesaid."

The court in Cory v. France decided that an employer who was contributorily negligent in respect of an injury to a worker could not proceed against a third party also liable to the worker and seek indemnity for the compensation paid because the legislation, as a matter of strict construction referred to a sole legal liability in a third party.

123. Buckley L.J. said at p. 125:-

"The first question for consideration, I think, is whether the section is to be read as if it were 'circumstances creating a legal liability in a stranger', or as if it were 'circumstances creating a legal liability in a stranger or in the employer and a stranger'."

He came to the conclusion that the latter meaning could not be imported into the words of the statute because :-

"......... then the person by whom the compensation was paid is to be entitled to be indemnified by the person so liable to pay damages as aforesaid. Therefore if a case where there is a legal liability for damages in the employer and a stranger does come within the section the effect of the Act is that as between those two parties, both of whom are to blame, the one shall bear the whole of the onus to the indemnity of the other. That is a construction which I find highly improbable".

124. For that reason, he found for the third party or stranger against whom the employer had sought indemnity.

125. Kennedy L.J. gave a perhaps more fundamental reason for the same finding. He said:-

"It seems to me in dealing with a section which as regards this case is one giving a right to indemnity, that, if I can adopt any reasonable construction which will prevent the result of a man getting on indemnity in respect of damage to the production of which he has himself materially contributed, I ought to adopt that construction."

126. These portions of the judgment reflect two lines of reasoning by the court. The first was a strict construction of the words of the legislation itself. The second was a reasoning based on policy.

127. Mr Wong for Gammon argues before me that so far at least as the reasoning based on policy is concerned that has been negated by the bringing into being of legislation which allows contribution between tortfeasors. That legislation and such a concept did not exist at the time of the decision in Cory v. France.

128. He argues that because of legislation which has come into being since that decision enabling contribution between tortfeasors, now encapsulated in the Civil Liability (Contribution) Ordinance Cap. 377, s. 25 should be read as allowing the tortious employer to recover from the tortious third party as an indemnity only that part of the compensation paid attributable to the third party's fault.

129. There has apparently been no case in England overruling Cory v. France since tortfeasors contribution legislation has been enacted in that jurisdiction or in the jurisdiction of Hong Kong either for that matter. Nor have I been made aware of any ruling subsequent to such legislation upholding that case.

130. However the High Court of Australia an appeal from the Supreme Court of New South Wales in Public Transport Commissioner of New South Wales v. J. Murray-More followed Cory v. France. Section 64 of the relevant New South Wales legislation was in effectively identical terms to section 6 of the English legislation.

131. Barwick C.J. concluded a tortious employer could not recover compensation under that section from a tortious third party. He said:-

"Section 64 is part of a scheme of compensation: it is not part of any scheme to adjust rights between tortfeasors. Indeed, when legislation to the effect of s. 64 first appeared in workers' compensation legislation there was no contribution between tortfeasors, nor any ability for tortfeasors liable for the same damage to be sued in the one action. .................... In my opinion, it intends to cover the case where the only liability of the employer to the worker is the statutory liability to pay compensation. It seems to me that it sufficiently expresses this by the expression 'a legal liability in some person other than the employer', appearing as it does after the provision of s. 63. These words, in the evident scheme of Pt VIII, are adequate to indicate that the employer for whom s. 64 is making provision is not one of the persons who has produced the circumstances out of which the liability to pay compensation has arisen. .................. The Act imposes a statutory liability upon the employer irrespective of fault. It allows of the possibility of proceedings against the employer at common law. For the damages for which he may thus be called upon to pay, it provides neither indemnity nor contribution."

` His reasoning was in effect two-fold. He construed the words "a legal liability in some person other than the employer" as meaning that the employer was not liable at common law in damages to the employee.

132. Perhaps more cogently he regarded the scheme of compensation, of which our present s. 25 is part, as being a purely statutory mechanism for the recovery of monies paid by the employer. There is no provision for apportionment of the amount of compensation paid to the worker as between the employer and the third party.

133. Indeed it may be thought that if Cap. 282 contemplated such a scheme of apportionment it would have plainly stated so and given some indication on what basis it was to proceed and apportionment be made.

134. But what of legislation allowing contribution between tortfeasors. Does it apply to s. 25 as Mr Wong urges upon me?

135. The decision in the Murray-More case was given many years after legislation allowing contribution between tortfeasors was introduced in New South Wales.

136. In his judgment Barwick C.J. went on to say:-

"An employer who is a tortfeasor in respect of the compensable injury - who, as I have already mentioned, could not have had any contribution at the time the language under discussion was first used - may now, if sued as s. 63 allows, exercise his right to contribution elsewhere provided. Likewise, the person who has contributed to the injury, if sued, as s. 64(1)(a) allows, can recover contribution from the employer as also a tortfeasor in relation to the injury. As I have already pointed out, the indemnity under s. 64(1)(b) is of the full amount paid as compensation. If an employer who was a tortfeasor in relation to the compensable injury could recover the compensation paid by him under s. 64(1)(b), perhaps after contribution proceedings between the tortfeasors which involved an apportionment of responsibility, that apportionment would be distorted."

137. It seems to me that the spirit and intent behind s. 25 is to create a statutory right in an employer to proceed and recover on an indemnity basis from a third party compensation he has paid to an employee.

138. That compensation is or may be assessed outside the principles of assessment of damages in the common law which are the basis of actions in tort to which our Civil Liability (Contribution) Ordinance relates. To import into the statutory scheme principles of contribution brought into being so as to be applicable to the level and nature of damages contemplated by the common law would seem to be something only to be done on the basis of a clear and unequivocal legislative intent.

139. That intention does not appear in section 25.

140. Further in section 9(3) of the Civil Liability (Contribution) Ordinance any such intent would appear to be expressly negatived. That section says:

"9(3) The right to recover contribution in accordance with section 3 supersedes any right, other than an express contractual right, to recover contribution (as distinct from indemnity) otherwise than under this Ordinance in corresponding circumstances; but nothing in this Ordinance shall affect -

(a) any express or implied contractual or other right to indemnity; or

(b) any express contractual provision regulating or excluding contribution,

which would be enforceable apart from this Ordinance."

141. On the face of that section the intention of the legislature is that the contribution provisions not apply to matters of indemnification whether by way of contractual rights or other rights. In this regard the section would seem to apply to statutory rights of indemnification.

142. In my judgment there is no doubt section 25 of Cap. 282 is an indemnity provision. Counsel for Gammon sought to distinguish the use of the words "any sum which he is obliged to pay" in section 25 from the express references to indemnity in both the English and New South Wales legislation.

143. In my opinion those words do not change the nature of the section. In Wah Kwong Construction Material v. Wong Man Yip the Court of Appeal proceeded on the basis that section 25(1) operated as an indemnity provision to allow recovery of compensation paid by employers and other costs paid by them.

144. In my judgment the words "any sum he is obliged to pay" simply underline the operation of section 25 as an indemnity provision.

145. Accordingly had I found any negligence in Wong or Fei Kow I would have held that the decision in Cory v. France is still good law in Hong Kong and Gammon could not recover from Wong or Fei Kow under section 25 of the Employees Compensation Ordinance for Wong as Fei Kow's negligence as breach of statutory duty because of its own negligence and breach of statutory duty.

146. That leaves Gammons claim in contract.

Gammon's claim against Fei Kow in contract

147. Gammon in addition to the express terms of the Agreement for Hire seeks also to import into that contract certain implied terms as set out in paragraph 5 of its claim.

148. So far as the implied terms alleged in sub-paragraphs 5(a) and (b) are concerned, they in my view are subsumed into the express term of the contract contained in Clause 5 thereof given the construction it will be seen I place upon it.

149. So far as the balance of the implied terms alleged in sub-paragraphs 5(c)(d) and (e) are concerned in my view it cannot be said that the parties intended the incorporation of those terms above and beyond what is already expressly and comprehensively set out between them in Clauses 2, 5, 11 and 12 of the contract. Those clauses regulate in considerable detail the provision of proper equipment and liabilities between the party's.

150. In my view the Plaintiff has failed to establish that any implied term as pleaded formed part of the partys obvious contractual intention separately and apart from the contracts express incorporation of that intent. No implied term as pleaded is necessary to give further efficacy to the contractual intent of the parties.

151. That leaves the express terms of the contract.

152. Gammon relies upon Clauses 2, 5, 11 and 12 of the Agreement between it and Fei Kow dated 2nd March 1995 and schedules thereto for the hire of the truck crane.

Clause 2 Second Schedule

153. Gammon asserts that this clause operates in respect of the canvas slings used by its servants on the 24th June so as make it a condition that the slings were in good order and condition.

154. The clause reads:-

"The Plant shall be in good working order and condition when delivered to the Hirer and the output shall be of full capacity as stated for the Plant by the manufacturer:"

155. Gammon claims that the reference to "Plant" in the clause includes the canvas slings, as the definition of "plant" in Clause 1(c) immediately above it is as follows:

" 'Plant' covers all kinds of plant, machinery, equipment and accessories therefor which the Owner agrees to hire to the Hirer."

156. Counsel for Fei Kow argues that even if the canvas slings happened to be accessories to the truck crane on the 24th June by the gratuitous fact they had been placed on it some months earlier, those accessories had not been agreed to be hired to Gammon. He argues that on a true construction of clause 2. there must be a specific and express agreement to hire any accessory before it becomes "plant" the subject of the contract.

157. He points out that if it was intended by the parties that Gammon simply hired a truck crane and that hiring was taken to include accessories then the clause would have read so as to have the words "and accessories therefor" at the very end of the clause.

158. Accordingly, it was argued for Fei Kow that the clause as presently constructed plainly expresses that "plant" is restricted to items specifically referred to as the subject of the hire agreement.

159. In my view that is not so. It would be impossible to refer to all of the accessories that go with heavy equipment and indeed would require inspection of the particular piece of equipment in considerable detail so as to incorporate all relevant items of its equipment into the Requisition Order under the contract. That cannot have been the intention of the parties.

160. If in the present case a block and tackle had been part of the loose equipment of the truck crane and had, for the purpose of the particular job been at some stage attached to the jib of the crane it seems difficult to see how that would not have been intended by the parties to be a part of the equipment or an accessory subject to the agreement for hire. In my opinion the words "accessories therefor" must mean other equipment or items which are present on the truck crane and have the purpose of being used in the course of or to facilitate its lifting and transportation functions. Lifting slings, whether of wire or canvas plainly fall within that class of objects.

161. It may well have been that the clause could have been better expressed but in my view all lifting equipment, including slings, carried on the truck crane when it arrived at the Gammon yard formed part of the accessories to it and were covered by the Agreement as "plant".

162. The words "and accessories therefor" in my view relate to and qualify the words "....plant machinery and equipment" which are themselves in turn subject to the phrase "...which the owner agrees to hire ....".

163. However liability in Fei Kow only arises under the condition expressed in Clause 2 of the contract in the event that the plant is defective in some way.

164. For the reasons I have given there has been no evidence that the canvas slings were not in good working order. They failed because of the method of rigging used rather than from any inherent defect.

165. Accordingly Gammon has failed to make out any breach of the condition relied upon in Clause 2 of the Second Schedule as against Fei Kow.

Clause 5 Second Schedule

166. Gammon claims also breach of Clause 5 of the Second Schedule to the Agreement.

167. That clause states:-

"When a driver or operator is supplied by the Owner to operate the Plant, he shall be under the direction of the Hirer and shall for all purposes be the employee of the Owner and shall work according to the Hirer's programme. The Owner shall be liable for the acts, defaults, omissions or negligence of the driver or operator and shall keep the Hirer indemnified against all claims, losses, damages, costs and expenses arising directly or indirectly therefrom."

168. Counsel for Gammon in his case apparently relied upon this clause as providing a complete indemnity to Gammon as against Fei Kow for all damages incurred as a result of the accident.

169. In my view that is not the meaning of the clause upon a proper construction. It states that the owner, i.e. Fei Kow, shall be liable for the negligence of Wong and shall indemnify Gammon against all claims arising from that negligence.

170. The clause plainly refers to negligence but does not, in its terms, expressly state that Fei Kow is to indemnify Gammon for claims arising from Gammons own negligence.

171. In Smith v. South Wales Switchgear (1978) 1 All ER 18, the House of Lords reiterated that there is a presumption against the parties to a contract intending one of them bear the burden of the others negligence. The tests proposed in Canada Steamship v. Regem (1952) A.C. 192 was again approved. That three stage test is as follows:-

"(1) If the clause contains language which expressly exempts the person in whose favour it is made (hereafter called 'the proferens') from the consequence of the negligence of his own servants, effect must be given to that provision ..... (2) If there is no express reference to negligence, the court must consider whether the words used are wide enough, in their ordinary meaning, to cover negligence on the part of the servants of the proferens ..... (3) If the words used are wide enough for the above purpose, the court must then consider whether 'the head of damage may be based on some ground other than that of negligence'."

172. In the present case Clause 5 of the Agreement does not expressly exempt Gammon from damage caused by its own negligence. Rather it purports to render Fei Kow liable to indemnify Gammon for all claims and damages arising from Wongs negligence.

173. In my view the clause must be construed as taking Fei Kow's duty to indemnify Gammon no further than Fei Kow's obligations at common law. I do not think the words "directly or indirectly" extend the range of liability. The go no further than to state an obvious aspect of causation.

174. Accordingly, Clause 5 in my judgment falls within the third category of Forsikrings v. Butcher (1988) 2 All E.R. 43 where the following statement of the law was approved:-

"The category (3) question has arisen in very many different types of case and the answer is treated as so obvious that it passes without any comment. It is commonplace that actions are brought by persons who have suffered personal injuries as the result of the negligence of the person sued and that there is a contractual as well as tortious relationship. In such cases apportionment of blame is invariably adopted by the court notwithstanding that the plaintiff could sue in contract as well as in tort. The example normally cited in the present context is the decision of the Court of Appeal in Sayers v. Harlow UDC [1958] 2 All ER 342, [1958] 1 WLR 623, which concerned a contractual visitor to premises (a lady who had paid to use a public lavatory). The Court of Appeal said it did not matter whether the cause of action was put in tort or in contract and proceeded to apportion blame awarding her three-quarters of her damages."

175. In my view Clause 5 takes Gammon no further than its rights to recover damages for negligence against Fei Kow. I have already apportioned liability for those damages as between Gammon and Fei Kow in the previous portion of my judgment. That finding applies to Gammons rights pursuant to Clause 5 as well.

176. I will now turn to Clause 11.

Clause 11 Second Schedule

177. That Clause states:-

"The driver or operator supplied by the Owner shall comply with the provisions of any Ordinance or Regulation relating to safety and the carrying out of construction works. In the event that the driver or operator shall be in default of any of the aforesaid obligations, the Owner shall indemnify the Hirer against any expenses, charges, fees, penalties and other losses of whatsoever nature thereby sustained."

178. Its meaning is obvious. I have as a matter of fact found no breach of any statutory duty by Wong in the operation of his crane truck or in the use of the canvas slings.

179. This clause is of no assistance to Gammon on the findings in this case in claiming damages or indemnity.

Clause 12 Second Schedule

180. Gammon relies on this Clause also for a complete indemnity, covering loss occasioned by its own negligence and extending also to fines paid by it as a result of its conviction for breach of the provisions of section 6A of the Factories and Industrial Undetakings' Ordinance Cap. 59.

181. The clause states:-

"The Owner shall at all times make good at his own cost and indemnify the Hirer against all liabilities to other persons (including the servant and agents of the Hirer or of their Subcontractors or other Contractors) for bodily injury, death, damage or loss to any property on or adjoining the site and against all costs, charges and expenses that may be occasioned of the Hirer by the claims of such persons.

Provided that the Owner shall not be bound by the above if such injury, death or damage was solely caused by the wrongful or negligent acts or omissions of the Hirer, its servants or agents."

182. So far as the first test in Canada Steamship is concerned, it is apparent that the body of the clause does not specifically refer to negligence. The only such express reference comes in the proviso to the clause.

183. Nevertheless the body of the clause which purports to impose the obligation on Fei Kow to indemnify is expressed in very broad terms. It refers to "all liabilities to other persons".

184. Additionally the proviso to the clause does refer expressly to negligence. It may refer to circumstances which exempt Fei Kow from the imposition of a liability to indemnify but in doing so, to my mind, necessarily imports back into the meaning of the words "all liabilities" in the body of the clause liabilities arising from negligence.

185. Accordingly, read as a whole, in my view the clause expressly indemnifies Gammon from the consequences of its own negligence, save in the particular circumstance where Gammon was solely negligent, or at fault as is my finding in this case.

186. However I might add that where the extent of the indemnity sought to be relied upon by the proferens is reduced in scope, as here where Gammon is not indemnified unless Fei Kow was also at least partially negligent, then so also is the strength of the presumption against the meaning of the clause extending to indemnify the proferens for its own negligence. In any event in my view the words "all liabilities" in the body of the clause satisfy the second test in Canada Steamship. They are wide words which have been held on many occasions to extend to liabilities arising from negligence.

187. Finally, the third test in Canada Steamship would not have operated to the benefit of Fei Kow so far as the construction of the clause is concerned. In my view, the specific reference to "wrongful or negligent acts" must negative any intention by the parties that the clause itself apply to heads of damage other than negligence. It makes no difference that this reference is contained in the proviso to the clause. It is a plain recognition within the language of the clause as a whole that the clause apply to acts of negligence.

188. In my view, Clause 12 would have operated to provide Gammon with an indemnity as to its liability to other persons outside of the situation where the death or injury to its workers was caused wholly by its own fault. The indemnity is limited to liabilities in Gammon "to other persons" for injury or death and for costs charges and expenses caused by those persons claims.

189. In other words the indemnity does not extend to fines paid to the Hong Kong Government for breach of statutory duty. Such a fine could not be a "cost charge or expense" which was occasioned by the claim of any injured person. It is purely independent of any such claim. The clause however does in my view extend to monies paid by Gammon to the estate of the deceased worker and to the injured worker pursuant to any order made under the Employees Compensation Ordinance, Cap. 282. The words "all liabilities to other persons" apply to such payments.

190. Nevertheless as is apparent from my findings of fact, and in the language of clause 12, the "injury death or damage was solely caused by the wrongful or negligent acts or omissions of the Hirer, its servants or agents". Accordingly the proviso applies and Gammons claim must fail also against Fei Kow on this final basis. The fact that Fei Kow was liable to Wong in my findings in P.I. 1289 on the principle of a non-delegable duty of an employer does not go to "cause" as expressed in Clause 12 and does not effect the operation of the proviso.

191. Accordingly in this action judgment for the Defendants.

192. So far as costs are concerned of the trial before me in respect of P.I.A. 1289/97, I order costs nisi to the Plaintiff as against the Defendants to be taxed at the Legal Aid rate if not agreed.

193. In respect of H.C.A. 7939/97, I order costs nisi to the Second Defendant as against the Plaintiff to be taxed if not agreed.

194. I order costs nisi to the First Defendant to be taxed at the Legal Aid rate if not agreed.