CHEUNG TUEN PIU v. CHINA TALENT ENGINEERING LTD AND ANOTHER

DCEC 841/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 841 OF 2010

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JUDGMENT

Introduction

1. This is the Plaintiff’s (“Cheung”) claim for employees’ compensation under sections 9, 10 and 10A of the Employees Compensation Ordinance, Cap 282 (“Ordinance”) against his alleged employer, the 1^st Respondent herein (“China Talent”) and the principal contractor,  the 2^nd Respondent (“United Construction”).

2. On 8 January 2009 at around 4.30 pm, Cheung was standing on a wooden ladder and painting a water pipe newly installed at the ceiling along the corridor of 25/F of Kwai Ching House, Kwai Fong Estate (“Site”). Suddenly, the screw of the metal hinge of the ladder became loose. As a result, he fell from the wooden ladder and sustained injuries to his back (“Accident”). He claims that at the time of the Accident, he was an employee of China Talent to do the painting work in question.

3. While China Talent and United Construction do not dispute that Cheung fell down from the wooden ladder and sustained injuries in the manner he claimed, they aver that Cheung was not an employee, but an independent contractor, of China Talent.

4. On quantum and subject to proof on liability, parties have no dispute that:

(1)  Cheung’s income for the month immediately before the Accident was $15,000;

(2)  The percentage of loss of earning capacity of 4% as stated in the certificate of review of assessment (Form 9) be adopted;

(3)  The medical expenses under section 10A of the Ordinance are agreed at $11,720;

(4)  Advance payment of $111,000 was made by the Respondents to Cheung and credit should be given for that.

5. In the circumstance, there remains only 2 core issues which require determination by this court:

(1)  Whether Cheung an employee or an independent contractor of China Talent at the time of the Accident;

(2)  What should be the sick leave period of Cheung for the purpose of calculating payment under section 10 of the Ordinance.

6. On these issues, Cheung has called 5 witnesses to give evidence in this trial, including himself, his wife, his younger brother (張端桂) and 2 other workers working at the Site at the material times.

7. On the other hand, the director of United Construction, the director (謝清綠) (“Tse”) and foreman (黃文輝) (“Wong”) of China Talent also gave oral evidence in the trial.

8. It is perhaps pertinent to point out at this stage that the evidence of the said 2 workers, as well as of the director of United Construction, does not shed much light on the issues because they all claimed that they did not have any direct knowledge on the nature of the working relationship between Cheung and China Talent.

Issue (1) : Was Cheung an employee or an independent contractor of China Talent

Legal Principles

9. Counsel on both sides have quoted me the most-often cited case of Poon Chau Nam v Yim Siu Cheung [2007] 1 HKLRD 951, in which the Court of Final Appeal set out the modern approach to the question whether a person is an employee of another. The court is to examine all the features of the relationship against the background of the indicia of employment with a view to deciding whether, as a matter of overall impression, the relationship was one of employment, bearing in mind the purpose for which the question is asked.

10. In explaining the indicia of employment,  Ribeiro PJ in Poon Chau Nam (supra) referred to the fundamental test laid down in Market Investigations Ltd v. Minister of Social Security [1969] 2 QB 175 (at 184 to 185) as approved by the Privy Council in Lee Ting Sang v. Chung Chi Keung and another [1990] HKLR 764. The fundamental test is as follows:

‘ “Is the person who has engaged himself to perform these services performing them as a person in business on his own account?” If the answer to that question is ‘yes’, then the contract is a contract for services. If the answer is ‘no’, then the contract is a contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of the considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that ‘control’ will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors which may be of importance are such matters as:

(1)  whether the man performing the services provides his own equipment;

(2)  whether he hires his own helpers;

(3)  what degree of financial risk he takes;

(4)  what degree of responsibility for investment and management he has; and

(5)  whether and how far he has an opportunity of profiting from sound management in the performance of his task.’

Form 2 and Witness Declaration to Labour Department

11. For reasons which will become obvious in the judgment below, I would first deal with the Form 2 and witness declaration given by Tse to the Labour Department.

12. A statutory Form 2 dated 20 January 2009 was filed by United Construction with the Labour Department after the Accident. It cannot be denied (and in fact it is admitted by Tse in his evidence) that it was China Talent who chose to use Form 2 to report the Accident to United Construction (see para 18 of his 1^st witness statement). In fact, all the information contained in Form 2 on the particulars of Cheung and the work relationship between Cheung and China Talent was provided by China Talent, as United Construction did not have any direct knowledge on the same. 

13. It was stated clearly in Form 2 that Cheung was an employed odd-job worker of China Talent at the time of the Accident.

14. Further, on 7 May 2009, Tse gave a witness declaration to the Labour Department in which he said that Cheung was employed by China Talent (“傷者受僱於華傑工程有限公司”). At the end of the witness declaration, Tse declared that the content therein was true and accurate. He also put his signature at the end of the witness declaration.

15. Between 9 April 2009 and 8 July 2010, China Talent advanced a total sum of $111,000 [$5,000 + ($10,000 x 10) + $6,000] on 12 separate occasions to Cheung. Such payments were described as “Kwai Fong Estate – work injury” (葵芳邨-工傷) in the payment certificates prepared by China Talent and signed by Cheung.

16. Tse explained in his evidence that he lacked the requisite legal knowledge and thus Form 2 was filed and the work injury payment was made to Cheung after the Accident under a mistaken belief. He further explained that at the time when the witness declaration was made, he had trouble of expressing himself clearly on the work relationship between Cheung and China Talent. Yet he stressed that in his mind, Cheung was always a sub-contractor for the painting work of China Talent.

17. Mr Lim, Counsel for China Talent and United Construction, submits to me that Tse is not a sophisticated and knowledgeable person. And given his background (he was educated up to 2^nd grade in high school in China only), the explanation offered by Tse is entirely credible. Further, once when Tse subsequently discovered that Cheung, though a worker, was not an employee, China Talent/United Construction applied with the Labour Department to withdraw the submission of Form 2 and stopped making further work injury payments to Cheung.

18. Mr Lim also draws my attention to the fact that Form 2 states that Cheung’s “wages [was] calculated according to the work progress” (“按工程進度計算工作薪金”), which is more consistent with Cheung being a sub-contractor.

19. I can deal with Mr Lim’s above argument on the wages right away. While Form 2 states that Cheung’s wages was “calculated according to the work progress”, it is also stated therein that his basic wages for the month immediately prior to the Accident as well as the average monthly income for the past 12 months prior to the Accident was at a uniform figure of $15,000. Thus, Mr Lim’s argument is neither here or there. I fail to see that the insertion of this phrase of “wages calculated according to the work progress” must mean that Cheung was a subcontractor.

20. Both Form 2 and the witness declaration of Tse are written in plain Chinese language and do not bear any technical jargons or clichés. The content therein is straightforward that can hardly leave any room for misunderstanding.

21. I have the benefit of observing Tse in person when he gave evidence in the witness box. It seems to be me that he is alert and careful in answering questions, especially during cross-examination. He was not shy to ask Mr Yip, Counsel for Cheung, to repeat or clarify any question(s) when needed be. For example, when he was asked if the certain receipts signed by Cheung before the Accident were pre-printed (“預先印製”) by China Talent, he asked Mr Yip to clarify what Mr Yip meant by that. He readily and instantly denied any suggestion that Cheung was an employee of China Talent. I do not find him having any difficulty in expressing his view on the work relationship between Cheung and China Talent in court at all.

22. Despite his education standard was up to grade 2 in high school, it is Tse’s own evidence that he has been running his own business as a sub-contractor in the construction industry in Hong Kong for over 10 years. When he set up China Talent in 2005, he initially employed workers to work for China Talent. But since 2007, he devised a scheme to save costs and better monitor work progress by allegedly sub-contracting various works to sub-sub-contractors instead of employing workers.  It can hardly be said that Tse is an un-sophisticated person. Instead, he is a businessman with well-planning and management of his own business.

23. On the other hand, as rightly pointed out by Mr Yip, it is one thing for Tse to misunderstand the duty to file Form 2; but it is entirely a different thing that the contents of Form 2 was filled in mistakenly, for the content should have been known or believed by Tse all along.

24. If his evidence that in the foremost of his mind, Cheung was China Talent’s sub-contractor bears any truth, it remains inherently implausible and starkly against common sense that Tse would unequivocally said in Form 2 and the witness declaration that Cheung was “employed” by China Talent. Further, throughout the same witness declaration, there is not a single word which suggests that Cheung was a sub-contractor. In fact, he referred Cheung as the “injured person” instead of a “subcontractor” throughout the witness declaration.

25. Given the above analysis, I do not believe in and refuse to accept the explanation offered by Tse in relation to Form 2, witness declaration and the work injury payments made to Cheung after the Accident. I find that the information contained in Form 2 and the contemporaneous witness declaration as to the work relationship between Cheung and China Talent (ie Cheung was employed as an odd-job worker by China Talent in the Site) is in all respects true and accurate details provided by Tse without any mistaken belief or misunderstanding .  

26. I further find that Form 2 and the witness declaration, when considered together with the work injury payments, amount to a clear and unequivocal admission on the part of China Talent that Cheung was in fact its employee at the time of the Accident. China Talent (as the direct employer) and United Construction (as the principal contractor) should be liable to compensate Cheung according to the Ordinance.

27. In reaching the above findings, I have reminded myself that the authorities are clear that it is for the court and not the parties to determine the legal nature of their relationship, such that the parties' own description of their relationship is not determinative: see Chan Kwok Kin v. Mok Kwan Hing [1991] HKLR 631. However, I can hardly think of any other logical reason that can possibly explain why Tse/China Talent would describe Cheung as its employee after the Accident, except for the reason that China Talent/Tse was stating the truth in Form 2/witness declaration.

28. Given my findings above, there is really no more need for me to embark on an analysis by reference to the indicia of employment set out in Poon Chau Nam (supra). However, just for completeness and just in case (assuming only) that I was wrong on the above conclusion, I will in the judgment below proceed to considering all features of their relationship against the background of the indicia of employment.

Indicia of Employment

29. Save and except the location and scope of work which Cheung was asked to do by China Talent, the parties dispute and gave diametrically-opposite evidence on all other aspects of their working relationship, such as on the terms of engagement agreed; who provided tools (including the ladder involved in the Accident); whether Cheung’s wife and brother were hired by Cheung himself or China Talent to do the painting work at the Site.

30. They also have dispute on the weight to be placed on various receipts signed by Cheung upon payments made by China Talent. These receipts are either entitled “salary receipt” (薪給收據) (“Salary Receipt(s)”) or “Receipt with signature for Subcontractor Project Fee” (分判商工程費簽收單)/“Project Fee – Payment Certificate” (工程費用-付款証明書) (“Project Fee Receipt(s)”).

Terms of Engagement

31. There is no dispute that there were 38 floors each at Kwai Ching House and Kwai Ming House of the Site where newly installed water pipes needed to be painted.

32. Mr Lim submits to me that this court should first decide whether Cheung was paid $500 per day (in which case Cheung must be an employee), or whether he was hired for $500 per floor or $38,000 for 2 blocks (in which case this court has to consider the indicia of employment in order to reach a determination if Cheung was an employee or independent contractor).

33. Mr Lim further submits Cheung has shifted his evidence from $500 per day to $500 per floor and thus should not be believed.

34. I would simply refer to the 1^st witness statement of Chueng in which he said that for the past few years before the Accident, he had been working for Tse/China Talent at a daily rate of $500. For the painting work in question, he said that he would be offered the job provided he could finish painting one floor of water pipes one day. Properly read, the evidence of Cheung is that he was engaged by China Talent to paint the water pipes of the Site at $500 per floor per day. I do not note any material change of his evidence on this point. I believe in his evidence.

35. Co-incidentally and in support of Cheung’s evidence as aforesaid, the payment allegedly made directly to Cheung for the painting work done in December 2008 (ie $15,000) is a multiple of $500 and the period covered is exactly 30 days.

36. Such work arrangement clearly falls within the ambit of “specific engagement” (an engagement which begins and ends with the performance of any one task) defined by Riberio PJ in Poon Chau Nam (supra) (at paras 34 – 45). Each specific engagement is capable of giving rise to a contract of employment.

Salary Receipts and Project Fee Receipts

37. Whenever Cheung received payment of work from China Talent, he (or his representative) was required to sign a Salary Receipt or Project Fee Receipt.

38. The evidence shows that he signed 2 Salary Receipts for the month of April and May 2008 (couple with corresponding work attendance records (返工記錄) filled in by Cheung). China Talent agrees that for those works stated in these Salary Receipts, Cheung was employed to perform such works.

39. However, in the Project Fee Receipts, Cheung was named as a sub-contractor of China Talent.

40. According to Tse and Wong, China Talent has since about 2007 sub-contracted its works out to different subcontractors in order to save costs and for better management. It was only for those small odd-jobs that could not be conveniently sub-contracted that China Talent would hire a daily wage odd job worker.

41. Mr Lim asks me to note that for the months of April and May 2008, Cheung signed on both Salary Receipts and Project Fees Receipts, which show that while he was an employed odd-job worker of China Talent for some of the days in these 2 months, he was also a subcontractor of China Talent in the same 2 months. These Receipts are in conformity with the evidence of Tse and Wong.

42. Mr Lim also refers to the Project Fees Receipts for August 2008 (in total sum of $41,000) and September 2008 (in total sum of $36,000). He says that given Cheung’s evidence is that he was paid $500 per day, it would take him 82 days to earn $41,000 or 72 days to earn $36,000, which was obviously not possible (since there are only 30 or 31 days within August and September) unless helpers were engaged by Cheung.

43. Mr Lim reminds me that both the Salary and Project Fees Receipts were made before the Accident, which is good evidential proof to the work relationship of Cheung and China Talent.

44. There remains no need for me to emphasize that how China Talent labelled its payment to Cheung is not conclusive and determinative; this court looks at substance of their relationship rather than label.

45. The above proposition is particularly true when the alleged details stated in these Salary Receipts and Project Fee Receipts were all admittedly prepared and pre-printed by China Talent.

46. In additional to the above observation, I note that the Project Fee Receipt dated 22 January 2009 issued to Cheung’s brother does not tally with Tse’s evidence that Cheung’s brother was neither a subcontractor nor an employee of China Talent. On this point, Tse sought to explain that it was due to Cheung’s submission of a Slip of Amount Entries (上數單) for payment ($15,000) to be made direct to his brother. I reject such evidence of Tse, for if it was really true, the total sum paid to Cheung (either directly to himself or indirectly to his brother at Cheung’s request) for December 2008 would have amounted to $30,000, which by itself contradicts to the amount of Cheung’s earnings stated by China Talent in Form 2.

47. In his evidence, Cheung offered an explanation on the Project Fees Receipts. He said that being an odd-job worker, he did not care how he was labelled in these Receipts, as long as wages were paid to him. He further said that China Talent did not always pay him on regular intervals; sometimes, he was paid once every several months.  Thus, the amount stated in these Receipts represented back payment of unpaid wages from previous month, which he did not mention in his written witness statement because there was no more outstanding wages due from China Talent as at the time when the witness statements were made.

48. By way of background, Cheung was born in China on 15 June 1961 and educated up to junior high school. He came to Hong Kong in 1997 and since then had been working in the construction industry doing odd-jobs up to the date of this Accident. During this trial, Cheung does not impress me as particularly smart and educated. Without any disrespect to him, he seems to me that he comes from the labour force within the lower class of our society. Understandably, his foremost concern is on getting paid rather than paying attention to how he was labelled in the Project Fee Receipts. I find some truth in his explanation, which I do accept and believe.

49. Mr Lim further points out that it is only during this trial that Cheung claimed, for the first time, that the payment stated in Project Fee Receipts included back payment of unpaid wages. However, it is imminent from the Salary or Project Fee Receipts that China Talent had been late in making payments to Cheung. For example, the Salary Receipts reveal that the wages of April and May 2008 was paid only on 20 June 2008. The Project Fee Receipt of September 2008 shows that payment was made only on 7 November 2008.

50. Further, Wong’s oral evidence to some extent reveals that China Talent would owe and delay payment to Cheung.  During cross examination, it was put to Wong that he did not have direct knowledge if Cheung was an employee or subcontractor of China Talent. Wong did not agree and went on to explain how he handled the slips for payment submitted by Cheung. Wong said that he would divide the slips submitted by Cheung into different categories (of salaries or subcontractor’s project fees). He would try paying the daily wages first so that China Talent would not owe both types of payment at the same time (“唔會同時間兩樣都欠”).

51. To conclude, I believe and accept that Cheung’s evidence and explanation in respect of the Salary and Project Fee Receipts. I find on balance that the Project Fee Receipts do not truly and accurately reflect the true work relationship of Cheung and China Talent. It is thus not safe to rely on these unilaterally labelled Salary and Project Fee Receipts in determining the work relationship between Cheung and China Talent. I will place no weight on these Receipts.

Hiring of Cheung’s wife and brother

52. In their evidence, Cheung, his wife and his brother insisted that they were all employed by China Talent as odd-job workers at $500 per day. As mentioned above, it is shown in the Project Fee Receipt dated 22 January 2009 that China Talent had made a payment of $15,000 direct to Cheung’s brother by way of a cheque dated 26 February 2009 drawn in the brother’s name.

53. Tse and Wong of China Talent denied and said that Cheung’s wife and brother were neither the employees nor the subcontractors of China Talent.

54. Mr Lim submits that Cheung’s wife is an untruthful witness. It is illogical and unreasonably that she was unable to recall the amount of alleged wages paid by China Talent to her in any given months. It is equally illogical of her evidence that she did not have to sign on a payment receipt due to her illiteracy, for she admitted in her evidence that she could in fact sign her name.

55. I have clear recollection that Cheung’s wife did not know how to read the wording of the oath before giving her testimony. She also looked rather nervous and shy in court. But after giving credit to any nervousness that might be caused by court environment, I think Mr Lim’s submission on the wife’s evidence does carry some weight, for it does not occur to me that she has told me the whole truth of the matter. I would not go as far as saying that she was lying before me, but it is certainly unsafe and undesirable to rely on her evidence.

56. There lacks any objective or documentary evidence to show that the wife was hired by China Talent in respect of the painting work. Therefore, on balance, I incline to think that it was Cheung who asked his wife to assist him in the Site.

57. Mr Lim also comments on the evidence of Cheung’s brother. His evidence is that he did not have any bank account until he opened one with the Bank of China in order to cash the crossed cheque given to him by China Talent pursuant to the Project Fee Receipt dated 22 January 2009. He then went on to say that he was employed by China Talent for about 1 year since March 2008, during which he was paid by cash, crossed cheque(s) or open cheque(s).  But when it was pointed out to him by Mr Lim that unless he had opened a bank, he could not have cashed the open or crossed cheque(s) received by him in 2008, he changed his evidence to say that he was paid in cash only in 2008.

58. I must say that Mr Lim has made very sound comments on the evidence of Cheung’s brother, as a result of which I find it unsafe to rely on the brother’s evidence.

59. However, this does not mean that I would necessarily accept Tse and Wong’s evidence and conclude that the brother was not an employee or subcontractor of China Talent. I say so because I find it equally unsafe to rely on Tse’s evidence on this point. When Tse was being crossed-examined by Mr Yip, he was evasive and gave convoluted answers to simple questions posed by Mr Yip.  For example, when he was asked to confirm if it was his case that Cheung’s brother was never a subcontractor of China Talent, Tse did not give a straight denial right away. Instead, he claimed that he had seen Cheung’s brother working for other subcontractors at the Site. When asked to confirm if the brother and China Talent had any direct work relationship, he gave an irrelevant reply that he was not sure if the other subcontractors hired the brother to work or not.

60. I pay no regard to Wong’s evidence on this point because it is clear to me that, for whatever Wong claimed to know about the work relationship (or the lack of it) between the brother and China Talent was told by Tse to him.

61. As such, I am of the view that I cannot rely on the live evidence of Cheung’s brother or Tse to determine who hired the brother to work in the Site. I therefore have to resort to objective documentary evidence in order to adjudge on this issue.

62. In my view, the most important documentary evidence is Form 2 submitted by China Talent to United Construction. It goes beyond dispute that the said payment of $15,000 allegedly made to Cheung’s brother at the behest of Cheung is not included in Form 2 as part of Cheung’s earnings of December 2008. The fact that this sum of $15,000 paid to Cheung’s brother was not regarded as Cheung’s earnings means more likely than not that China Talent must have regarded this sum as the payment made to and received by Cheung’s brother personally (as opposed to payment made to and received by Cheung’s brother on behalf of Cheung). And I can think of no other reason that China Talent would pay to Cheung’s brother in his personal capacity except that the brother was either a subcontractor or an employee of China Talent.

63. I take the further view that there is no need for me to make a determination whether the brother was an employee, or a subcontractor, of China Talent at the material times, for once when I find that the brother had a direct work relationship with China Talent in relation to the painting work (and I so find), it follows logically that the brother could not be taken as being hired by Cheung at the time of the Accident.

64. In so finding, I have not overlooked the evidence that after the Accident, Cheung’s brother finished the uncompleted painting work for Cheung. A further and final sum of $8,000 was made to Cheung instead of to the brother. However, I have already ruled that the contract between Cheung and China Talent was one of specific engagement under which Cheung was required to complete a specific task that has been agreed upon. That said, even if Cheung, for obvious reason after the Accident, had really asked his brother (paid or not paid by Cheung) to finish off the painting work that Cheung was supposed to perform does not, in my view, change the fundamental nature of the work relationship between Cheung and China Talent.

65. It is necessary for me to consider the effect on the work relationship between Cheung and China Talent given my findings in relation to the wife in para 56 above. Further, for completeness and just in case I was wrong on the above analysis in respect of the brother, I would have the following to say.

66. It is undisputed and important to note that Cheung was personally involved in the painting work until the occurrence of the Accident. It is also not disputed that Tse was aware of the fact that Cheung’s wife and brother both worked in the Site. In fact, at some stage of his oral evidence, Tse claimed that Cheung had told him that he would ask his wife to come to help him in the Site. There is no evidence showing that Tse had objected to this arrangement.

67. In Chitty on Contracts Vol II, 30^th ed, at para.39-022, the learned editors cited Robinson v Hill [1910] 1 KB 94 and said this:

“A person cannot normally be an employee if he is entitled to delegate the entire performance of his work to another person; but a person may possibly be an employee, although he himself (with the permission of the employer) employs assistant to help him.” (italics added)

68. It is not clear from the evidence before me as to the extent of the wife and brother’s involvement in the painting work undertaken by Cheung, save that the evidence is clear that after the Accident, the brother finished off the uncompleted painting work which accounted for only about 10% of the original work.  

69. Although Cheung’s brother had received $15,000 in relation to the painting work, there is not sufficient evidence before me as to how much of work this sum of $15,000 represents or corresponds with.

70. In totality of all evidence before me, I do not find it sufficient evidence to find that Cheung had delegated his works to his wife and/or his brother to the extent that it can support the existence of a contract for services.

Tools

71. In his witness declaration given to the Labour Department, Tse stated the following:

“傷者使用的木梯是由判頭提供。傷者使用的木梯保養及維修也應由判頭負責。如果木梯損壞或不能使用， 現場貨倉(貨櫃箱) 亦有4至5張後備梯可供使用…” (italics added)

72. Tse’s witness statement quoted above clearly does not equate the injured person [Cheung] to a subcontractor. That being the case, the ladder involved in the Accident could not possibly belong to Cheung, for if it was, Tse would have said that the wooden ladder was provided by the injured person [Cheung] himself. 

73. Tse sought to explain on the stand-by ladders (後備梯) to mean those wooden ladders owned by other subcontractors of China Talent at the Site. I do not believe in this explanation for its self-serving nature.

74. There is clear evidence before me that the work to be done at the Site related only to replacement and painting of newly installed water pipes situated at the ceiling of each floor, which means that a ladder would be required at all times by each worker when the replacement or painting works were being done. Given the rather small-scale of the project, it is more unlikely than not that there would be 4 to 5 stand-by ladders left idle around by other subcontractors at the warehouse at any given time for Cheung’s use, bearing also in mind that Cheung, his wife and his brother would each have to use (and in fact did use) a ladder during the whole duration of the painting work for over a month.

75. Therefore, on balance, I find that it was China Talent who provided the work tools including the ladder in question to Cheung at the time of the Accident.

Control

76. It is clear to me that China Talent had some control over Cheung and his work.

77. Tse/China Talent had the power to select and appoint Cheung to take up the Painting Work. According to Tse’ own evidence, he even set the time limit for Cheung to complete the Painting Work, ie about 2 months. According to Wong, the foreman of China Talent, China Talent has employed clerical staff to monitor the progress of the project. Both of them have stated in their witness statements that they went to the Site almost every day to inspect the construction works. It matters not whether the inspection of Cheung’s work was done every day or not.

Financial Risk and Other Indicia

78. It is the evidence of Tse that he offered Cheung $38,000 to complete the painting work within 2 months, which would give a rough figure of $650 per day. Mr Lim submits that compared with the daily rate of $500 that Cheung would earn as an employed odd-job worker, he would earn a windfall of $150 per day in the painting work if he together with his hired worker(s) could finish the same on time.  However, if the work progress is low, the chance of obtaining a profit disappears. In other words, the risk of profit and loss was passed from China Talent to Cheung.

79. It is undisputed that Cheung never owns or sets up any company, nor has he taken out any employee’s insurance or enrolled with any mandatory provident fund scheme. He impresses me as a simple-minded worker coming from the lower working class of our society. He did not even bother to make any full records of the work done by him for China Talent for self-reference.

80. In my view, his work was manual labour in nature and he was remunerated for his labour. He did not have to incur costs on materials.  His financial risk is therefore no different from a casual worker in any construction site doing odd-job works. There is further no opportunity of investment to speak of or profiting from sound management in the performance of the work.

81. As such, I will not have the slightest doubt in rejecting any suggestion that Cheung would possibly choose to carry on business on his own account.

Cheung is an employee

82. Due to the above evaluation of the indicia of employment, the picture which emerges and the overall impression which it gives to me is that Cheung was working for China Talent under a contract of service.

Issue (2) : What should be the Sick Leave Period

83. As a result of the Accident, Cheung was granted continuous sick leave until 25 March 2011 (26.5 months). Most of the sick leave was given by public hospitals with intermittent short periods of sick leave days given by private doctors (including Drs KT Chow and KC Wong).  Mr Yip for Cheung relies on Kan Wai Ming v Hong Kong Airport Services Ltd [2011] 3 HKLRD 497 to support his view that Cheung should be granted sick leave compensation up to 25 March 2011.

84. Mr Lim, however, refers me to the opinion given by Dr K C Lam (the Respondents’ orthopaedic expert) that the reasonable period of sick leave should have been up to September 2009 only (when the treating doctor found that Cheung’s condition was static) (8.77 months).

85. Fok JA in Kan Wai Ming v Hong Kong Airport Services Ltd (supra)  held that (at para 16):

“By section 10(2) a period of absence from duty certified to be necessary by one of the stipulated persons or bodies is deemed to be ‘a period of total temporary incapacity irrespectively of the outcome of the injury’. A sick leave certificate issued by a registered medical practitioner is the usual manner in which an injured employee obtains such certification to establish temporary incapacity for the purpose of section 10(1).” (italics added)

86. It should also be noted that according to Form 9, the sick leave of Cheung was certified by the Employees’ Compensation (Ordinary Assessment) Board at least up to the date of the review, ie 22 June 2010. It goes without saying that the Board was not in the position to certify (or not certify) the sick leave certificates issued after the date of the review.

87. Nevertheless, the sick leave period now claimed by Cheung is well supported by sick leave certificates.

88. While this court is certainly not bound by the sick leave granted by the treating doctors, I cannot see there is any valid reason to depart from what the treating doctors have opined in the period of sick leave. After all, it is the treating doctors, rather than the medical experts engaged by the parties in this case, who have the benefit of reviewing Cheung’s medical condition on a regularly basis from time to time.

89. As such, I conclude that for the sick leave given until 25 March 2011 is reasonable and should be adopted for the purpose of computing the compensation under section 10 of the Ordinance. 

Quantum

90. The total compensation payable to Cheung is therefore:

Section 9 :	$15,000 x 72 months x 4%	$43,200
Section 10 :	$15,000 x 4/5 x 26.5 months	$318,000
Section 10A:		$11,720 $372,920
LESS	Advance payment received	$111,000
	TOTAL:	$261,920

Conclusion

91. Due to the matters set out above, I make an Order that judgment be entered for Cheung in the sum of $261,920 with interest at half judgment rate from the date of the accident (ie 8 January 2009) to the date of this judgment, and thereafter at judgment rate until the date of full payment by United Construction and China Talent.

92. I will also make a costs order nisi that the United Construction and China Talent do pay Cheung’s costs of this claim, to be taxed if not agreed, with certificate for Counsel. If no application is made to vary this costs order nisi, it will be made absolute in 14 days from the date of this judgment. Cheung’s own costs are to be taxed in accordance with the Legal Aid Regulations.