CHENG SAM PAK v. THE ATTORNEY GENERAL FOR HONG KONG and Another

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

1997, No. 247
(Civil)

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JUDGMENT

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Mayo, J.A.:

1. This is an appeal from an assessment of damages made by Master Chung on 26th September 1997. The Appellant was injured in an accident which occurred on 10th December 1984 when he was aged 13. He was together with other lads playing in an area where a fireworks display had taken place the day before. One of the boys threw an unexploded firework to other boys and when it reached the Appellant he lit the fuse and it exploded. Injuries were caused to his right hand. It has been agreed by the parties that the Appellant was guilty of contributory negligence of 20%.

2. Particulars of the Appellant's physical disabilities were as follows:

"(a) numbness of the tips of the 4 injured fingers;

(b) reduced strength in the grip of the right hand;

(c) reduced length of the right thumb and right index, middle and ring fingers;

(d) scars at the sites of the injuries (which are at the tips of the said fingers);

(e) no abnormality in the movements of the injured fingers but the right hand would feel cold if temperature is low;

(f) when the weather changes, the stump of the thumb and the fingers would be painful and swollen."

3. The Master found that these physical disabilities had been proved. He was also satisfied that the Appellant suffered some negative psychological and personality effects. He summarised the Appellant's injuries in this way:

"(a) the Plaintiff suffered the physical disabilities as set out under the sub-heading 'Physical Disabilities'. I also find that there are cosmetic disfigurement but conclude that this should be included in the overall assessment for PSLA;

(b) the Plaintiff suffered and still suffers from a mild degree of depression and a mild degree of social withdrawal. He also has an awareness of his injured hand and a low self-esteem;

(c) these psychological effects are, however, general and mild in nature, and are to be taken into account when assessing the award on PSLA, rather than warrant an independent award on their own."

4. The master made awards under these heads.

1. Pain suffering and loss of amenities.

The master based his award under the category "serious injury". Damages under this category range from $400,000 - $540,000. In arriving at his award of $500,000 the master said:

"Taking all matters into account including the physical condition of the Plaintiff's right hand (functional and cosmetic), his psychological and emotional depression, the change in his lifestyle, diminished marriage prospects and so on, I agree with Mr. Westbrook and am of the view that the injuries suffered by the Plaintiff falls within the middle range of the 'serious injury' category. However, I consider that some slight upward adjustment need to be made to take into account the fact that the Plaintiff suffered the injuries at, and has been suffering the disabilities since, a much younger age than the plaintiffs in the other cases. For these reasons, I make an award of $500,000 under this head."

2. Loss of earnings.

The master divided this head into three separate parts.

(a) Loss of earnings up to the hearing.

(b) Loss of future earnings.

(c) Loss of earning capacity/handicap in the labour market.

5. The master did not make any award under (a) or (c). He awarded $360,000 under (b). This award was a global award which embraced all loss of earnings following the approach adopted in HO Ping-shui v HO Kwai-lin HCA No. A1547 of 1985 unreported and LAI Yee-kin v Top Crown Electroplating Factory Ltd. HCA A628 of 1986 unreported.

6. The master also made no separate award for loss of earning capacity.

7. The 1st ground of appeal is:-

"1. The award of $500,000 for pain, suffering and loss of amenities of life was too low. The learned Master erred in that having accepted the Defendants' (Respondents') submission that the Plaintiff's (Appellant's) injuries fell within the middle of the 'serious injury' category and that $500,000 should be awarded, he considered that some slight upward adjustment should be made for the Plaintiff's (Appellant's) young age when the injuries were suffered, but then failed to make such an adjustment. The award was not consistent with the level of damages awarded to other Plaintiffs in similar circumstances."

8. Mrs Kaplan for the Appellant submitted that it was incumbent upon the master to make an upward adjustment to take into account inflation which had occurred since July 1996 the date of the judgment in CHAN Pui-ki v LEUNG On and another [1996] 2 HKLR 401. It was clear that he had been in error as there could not have been any upward adjustment to take into account the Appellant's youth in accordance with the reasons given by the master.

9. The first question which has to be decided is whether it is indeed necessary for a master to make an upward adjustment for inflation.

10. Litton V.-P. as he then was considered this subject in CHAN Pui-ki at p. 408:

"When one takes into account the fact that, for the past year, general inflation has been running at about 7.5% in Hong Kong, it can be seen that whilst the judge's figures, given in October 1995 were on the high side - and wrong in principle as a direct equation with similar awards in the United Kingdom - they are not grossly excessive for awards as at the date of this judgment.

We would therefore affirm the judge's figures for the four categories and adopt them as the new guidelines, emphasising yet once again that these are guidelines, not straight-jackets, and intended to be flexibly applied. There are cases, such as the present one, where the injuries are composite: physical, mental and psychological. It is the total effect of the injuries which must be assessed rather than the artificial 'category' into which they fit most comfortably.

It must also be emphasised that, as a matter of common-sense, no community can expect an ever-rising standard of living, without stagnation and set-backs. Indeed, the more a territory like Hong Kong reaches the levels of 'developed countries', the slower normally would be such rise: some of the data before the judge demonstrates that in highly developed countries like France, Germany and Japan, there has been a 'deterioration' in recent years, as measured by such indices as 'purchasing power parity'. It would therefore be surprising if the guidelines laid down in this judgment should need revision for anything more than inflation, expressed by the various consumer price indices, for a long time to come."

11. It can be seen from this that it was by no means mandatory for the master to include an adjustment for inflation. It is not clear from his judgment whether he did in fact do so.

12. What is more important than this though is that an award under this head does not lend itself to a meticulous approach along the lines suggested by Mrs Kaplan.

13. The master's award was well within the permitted range of awards for serious injuries and it has not been demonstrated that the master was in error.

14. There is no merit in this ground.

15. It is convenient to consider grounds 2 to 6 together:

"2. The learned Master erred in failing to award any sum for pre-trial loss of earnings and further such finding was inconsistent with his finding that the Plaintiff (Appellant) was suffering a continuing loss of $2,000 per month in his award for loss of future earnings.

3. The learned Master failed to give any or any sufficient weight to the evidence of Alice Tsang and Shelley Chow as to the alternative employment opportunities no longer open to the Plaintiff (Appellant) and the loss of earnings thereby occasioned. In the premises he erred in finding that he could not attach much weight to the assessment of the occupational therapists as to what employments the Plaintiff (Appellant) would be capable of if he were able-bodied and that the assessment was based on the Plaintiff's (Appellant's) indication that he would be interested in these jobs.

4. The learned Master erred in failing to consider it meaningful to compare the Plaintiff's (Appellant's) actual earnings against the 'relevant' average income set out in the reports on wages compiled by the Census & Statistics Department when there was uncontroverted evidence that the Plaintiff (Appellant) was not able to find a higher paid job because of his disabilities.

5. The learned Master erred in adopting the multiplier of 15 which was an inadequate multiplier to employ having regard to the Plaintiff's (Appellant's) age and the circumstances of the case.

6. The learned Master erred in law in making an overall global award for loss of earnings and failing to make any award for loss of earning capacity when it was admitted that there was evidence for such a claim."

16. Mrs Kaplan submitted that the whole approach adopted by the master was flawed. He had failed to satisfactorily distinguish between loss of earnings and loss of earning capacity or handicap on the labour market.

17. The master had appeared to proceed upon the assumption that the Appellant could obtain equally remunerative employment as his friends who had not been incapacitated in the way he had.

18. She referred to the fact that it had been the ambition of the Appellant to become a police officer. When he had applied for recruitment to the Force his application had been rejected on the ground of his physical affliction.

19. Another career considered by the Appellant had been work as a sales representative. This aspiration was thwarted as a result of the Appellant's reticence concerning his disability and prejudice on the part of prospective employers who may feel that sales of their products might be adversely affected.

20. Mrs Kaplan contended that the master should have placed greater reliance upon the evidence of Ms Tsang and Ms Chow the occupational therapists who had given evidence concerning the employment prospects of the Appellant. She went on to consider the earnings of people in the occupations which had been referred to by these ladies.

21. I do not agree with the criticisms made by Mrs Kaplan.

22. It is not a legitimate exercise to consider the evidence of occupational therapists in as much as it relates to employment at large. While it is undoubtedly true that these experts can give real assistance to the court on the subject of what a particular patient can or cannot do this assistance cannot be extended to wider questions of what employment opportunities may exist and the financial implications of it.

23. Mrs Kaplan also criticised the Master for selecting a multiplicand of $2,000 per month for loss of earnings. She suggested that this figure had been arbitrarily chosen. I do not agree. Mr. Westbrook for the Respondents outlined the way in which this figure had been calculated.

24. He referred to statistics which had been produced by the Census and Statistics Department relating to wages, salaries and employee benefits.

25. These figures indicated the overall average salary paid to supervisory, technical, clerical and non production workers was $11,440 per month. The comparable figure for daily paid craftsmen and operatives worked out at $10,500 per month.

26. Mr. Westbrook submitted that these figures being overall figures tended to be unduly favourable to the Appellant as he had only been in the work force for a short time and would not yet be receiving as much as the overall average.

27. The Master had borne these wages in mind when he had calculated the $2,000 figure referred to. He had made a comparison with the Appellant's actual earnings which had been in excess of $9,000 per month but which had been reduced to $7,000 per month when he had changed jobs to his present employment.

28. One of the matters emphasised by Mrs Kaplan was the distinction which had to be made between loss of earnings and the risk factor which had to be borne in mind that the Appellant would almost inevitably find it more difficult to obtain employment if he was dismissed or changed jobs. There was some evidence of this in that it had taken him much longer than would normally be the case to obtain his present job. She placed considerable reliance upon Moeliker v A. Reyrolle & Co. Ltd. [1977] 1 WLR 132.

29. There is undoubtedly some merit in these contentions. It is however artificial to attempt to deal with such matters in isolation to the more general subject of actual loss of earnings.

30. It is clear from p.12 of the Master's judgment that he was mindful of these considerations and that he adopted the approach in HO Ping-shui of dealing with these matters globally. I consider that this was a realistic approach and was in conformity with the practice which is usually now adopted.

31. It is necessary to also comment upon two other matters which are raised in these grounds. The first relates to the complaint that the master did not award any damages for pre trial loss of earnings.

32. After analysing all of the relevant evidence the master said on p.9 of his judgment:

"I agree with the defence submissions and do not find any of the said periods of unemployment to have been caused by the Plaintiff's injured hand. As regards the 1st period, I find the unemployment to be the result of his being a fresh school graduate who faced keen competition in the labour market, and who was further interrupted by his sickness during that period. As regards the 2nd period, I regard it as a normal period of transition from school to work. As regards the 3rd period, I rather prefer the reasons the Plaintiff gave in his witness statement as the real reasons for his resignation. I find that the Plaintiff's resignation has nothing to do with his injured hand. The Plaintiff did not claim that his failure to find a new job has anything to do with his injuries and I find that to be the case."

33. The Master has given good reasons for not awarding these damages.

34. The 2nd matter relates to the complaint that when the master calculated damages for future loss of earnings and adopted the multiplicand of $2,000 he then went on to apply a multiplier of 15. Mrs Kaplan submitted that this was too low.

35. I disagree. While it is true to state that a multiplier of 15 was on the low side it is in conformity with the practice presently being adopted in cases of this nature.

36. What is evident when viewing this assessment as a whole is that the global award of $360,000 for loss of earnings did take into account all of the factors which needed to be weighed in this case. It took cognisance of the possible slight loss of earnings which the Appellant may suffer and also more importantly took into account the handicap the Applicant may have of experiencing more difficulty in finding alternative employment should he leave his present employment. I do not think that this award should be interfered with.

37. In this connection it is perhaps apposite to repeat the words of Litton V.-P. as he then was in CHAN Pui-ki:

"At the end of the day, we are concerned with a question of the cumulative impact of the disabilities on the life of the victim. This is a question of degree, on which reasonable minds could well differ, within a reasonable range. The judge might even have been generous in his award. Unless there is some error in principle we cannot interfere."

Ground 7

38. The Respondents at a late stage conceded that interest on the PSLA award should run to the date of judgment on quantum not the date of the interim judgment on liability.

39. That then deals with all of the grounds of appeal. For the reasons given and subject to ground 7, I am of the view that this appeal should be dismissed. The Respondents should be entitled to their costs save that the Appellant was successful on ground 7. In my view the Respondents should be entitled to 90% of their costs.

Rogers, J.A.:

40. The Master awarded a figure of HK$500,000 for pain, suffering and loss of amenities. I agree that this figure is within the permitted range of awards for what the Master has classified as a serious injury. The main ground taken on the appeal by Mrs. Kaplan on behalf of the Appellant is that no upward adjustment had been made to take into account inflation. Effectively two years has now elapsed since July 1996 and it is said that an upward adjustment of the figures in Chan Pui Ki v. Leung On & another [1996] 2 HKLR 401 should be made.

41. When approaching the question of damages for pain, suffering and loss of amenities, one of the factors which the Court should bear in mind is the question of inflation and the relative purchasing power of the sum awarded in relation to the figure in 1996. In doing so, I would caution that any estimate of inflation should be based on approved official figures and not on a rough estimate. Nevertheless, the figures given in the Chan Pui Ki case are a range. Hence provided the person making the award is aware of inflation and provided the award falls within the range of figures even adjusted for inflation it is unlikely that a Court would vary that on appeal. It is for the person making the award to fix an appropriate figure within the range. Whilst in this case I do not consider that the award is at all generous, I am unable to say that the figure is so low that it must be disturbed.

Loss of earnings and loss of earning capacity

42. In this case, the Master was not satisfied on the evidence that there had been any loss of earnings due to a failure to obtain work in the period up until the date of trial caused by the injury. Specifically, he had discounted three periods of unemployment for reasons which he attributed to matters other than the Plaintiff's injuries.

43. The Master approached the question of loss of future earnings and earning capacity on a global basis and in view of the difficulty of coming to an appropriate figure of what sum should be awarded to the Plaintiff to compensate him for the financial loss caused by his injuries, I consider that in the circumstances of this case that is justified.

44. The Master decided the question on the basis that the overall loss when taking everything into account including the vicissitudes in life should be $2,000 per month. Mr. Westbrook on behalf of the Respondent (Defendant) drew our attention in the transcript to how this figure was arrived at. In arriving at that figure of $2,000 the Master was presented with two difficulties. First in assessing what was the appropriate starting figure at which the Plaintiff should be notionally attributed now, given his injuries, and the second is what sum should be taken as the notional sum which the Plaintiff should be taken as reasonably likely to have earned had he had no injuries.

45. The Plaintiff had sought to rely on somewhat higher figures than the Master had taken based upon possible employment as a policeman or as a salesman. As regards being policeman that prospect was speculative at best. As regards being a salesman even on the figures in the tables presented to the Court, there is a range of figures. That too, however, was not accepted.

46. There must always also be a question mark as to whether the injuries suffered by the Plaintiff had upset the Plaintiff's later school studies. The Master did not accept that the Plaintiff was entitled to put his claim on the basis that his academic achievements had been materially affected by psychological problems associated with his injuries. Mrs. Kaplan, very fairly when asked did not seek to disturb that finding. Obviously, if the injuries had affected his studies, the Plaintiff might well be in a position to claim a larger loss of earnings.

47. I too have approached the matter on the basis that the figure arrived at by the Master was a reasonable figure. Again, I consider it is by no means generous.

48. I turn then to the multiplier. The approach of the Master was to attempt to estimate the financial loss on the basis of a global figure for the period which was effectively the whole of the working life of the Plaintiff. In the circumstances, the multiplier which was taken by the Master of 15 was low. The Plaintiff appears to have taken up employment as soon as might reasonably have been expected and I would not give a discount on the figure because of any uncertainties in this respect. If approaching the matter at first instance, I would perhaps have chosen a higher multiplier. I consider however that the multiplier that was chosen by the Master was within the bracket that was acceptable. Hence again whilst I consider that the Master was on the low side of the permissible, I do not feel able to say that his judgment was wrong to the extent that would justify alteration.

49. For these reasons, I would concur in the order proposed.

Nazareth, V.-P.:

50. I agree with Mayo JA.

51. The real problem in this case was to determine what the appellant's earnings were likely to be had he not been injured, so that the appropriate multiplicand could be determined. Where injury is sustained by a young child, this is generally a very difficult exercise. All sorts of imponderables enter into the equation. There was nothing here like a marked family intellectual or professional background to indicate the likely future occupation.

52. Mrs Kaplan, for the appellant, contended that fortuitously the very long period the case has taken to come to trial has provided a useful indicator in the appellant's ambition to be a policeman that he is said to have manifested. But the evidence discloses that on the probabilities he is unlikely to have achieved his ambition.

53. Both sides attempted to extrapolate earning levels from Census and Statistics Department remuneration and employment benefit statistics. Not surprisingly the choice of occupations made in that context seem to be selective rather markedly towards the upper end on behalf of the appellant, and towards the lower end, although more moderately so, on behalf of the respondents.

54. I confess that it seemed to me in this respect, as in most others, that the appellant had been less than generously treated. But then in determining his likely earnings, it appeared that given the material before him the master sensibly and reasonably elected for the overall average in the statistics. I do not think he can be faulted for that; rather the contrary. In those circumstances, what seemed to me to be the appellant's potentially best and most significant claim failed.

55. Likewise the multiplier of 15 adopted by the master could have been somewhat higher, but it does not, in my view, sufficiently depart, if at all, from existing guidelines in particular those in Chan Pui-ki v Leung On and another [1996]2 HKLR 401 as to warrant intervention by this Court.

56. Whatever instinctive feelings, educated perhaps, judges may have about the merits of such claims, it is only possible for them to intervene on well established principles and considerations none of which appear to apply here. I am unable to see any mistake or error, nor can it be said that the amount is plainly out of line with the recently revised guidelines. Notwithstanding some sympathy I have for the appellant in the somewhat less than generous award he has received and that will regrettably be decimated by the costs, the appeal has to be dismissed.

57. As to the costs, I cannot see how the respondents can properly be denied less than 90% of their costs.

58. Accordingly the appeal is allowed only in respect of ground 7, and there will be an order nisi that the respondents are to have 90% of their costs, to be taxed if not agreed.