NG TAT KUEN v. TAM CHE FU AND OTHERS

HCPI 896/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO 896 OF 2013

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J U D G M E N T

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INTRODUCTION

The background

1.  This is a personal injury action in which the Plaintiff sues the defendants for damages for personal injuries suffered arising out of and in the course of his employment.  The matter before the court is a trial on liability between the Plaintiff and the 3^rd Defendant.

2.  The Plaintiff was a driver cum delivery worker employed by the 1^st and/or the 2^nd Defendants to collect and deliver goods for and on behalf of the 3^rd Defendant. 

3.  The 1^st Defendant is the father of the 2^nd Defendant.  They were, respectively, the operator and proprietor of Wing Fai Transportation Co.  The 3^rd Defendant was a company incorporated in Hong Kong carrying on a retail business of selling furniture, household appliances, and electrical and electronic products.  It engaged the transportation services of the 2^nd Defendant under a Delivery Sub-contracting Agreement (the “DSC Agreement”).

4.  On 29 October 2010, the Plaintiff sustained serious injuries as a result of an accident while unloading goods to be delivered to the 3^rd Defendant’s retail outlet. 

5.  The Plaintiff sued the three defendants for employees’ compensation in the District Court.  That action was compromised by the Plaintiff accepting a sanctioned payment made by the 3^rd Defendant who was sued in the capacity as the principal contractor of the 1^st and 2^nd Defendants.

6.  Then the Plaintiff commenced the present action for common law damages on 22 October 2013.  The 1^st and 2^nd Defendants were sued as the Plaintiff’s employer and the 3^rd Defendant was sued as their principal contractor.  No notice of intention to defend having been filed by the 1^st and 2^nd Defendants, interlocutory judgment was entered against them on 31 December 2013, leaving damages to be assessed.  The 3^rd Defendant contested the claim. 

Causes of action and defence

7.  The causes of action relied on by the Plaintiff are: negligence, breach of statutory duty under the Occupational Safety and Health Ordinance and Occupiers Liability Ordinance.  In essence, his case is that he was an employee of the 1^st and 2^nd Defendants and the 3^rd Defendant was their principal contractor.  The 1^st and 2^nd Defendants are liable to him under the above causes of action and judgment has been entered against them.  As the principal contractor, the 3^rd Defendant is likewise liable to him along with the 1^st and 2^nd Defendants and also under section 24(1) of the Employees’ Compensation Ordinance.  In addition, the 3^rd Defendant as occupier of the workplace, ie the part of the pavement where the accident occurred, is also liable to him for breach of statutory duty under the Occupiers Liability Ordinance and Occupational Safety and Health Ordinance.  The 3^rd Defendant disputes liability.  It alleges that the Plaintiff was a sub-contractor engaged by the 1^st and/or 2^nd Defendants and pleads contributory negligence on the part of the Plaintiff.  

Credibility of witnesses

8.  Mr Leung criticises the Plaintiff’s credibility for making a few bald assertions, for certain inconsistencies between his evidence and his witness statement and for not being able to remember certain facts put to him in cross-examination.  I think the Plaintiff had tried his best to recall the events.  He frankly admitted he had the opportunity to look at the tailgate of his lorry and the gap between it and the pavement but paid no attention.  He admitted he had not thought about using the ramp which was not far away.  Having seen the Plaintiff and having regard to his health condition, I would not attribute such failings to dishonesty on his part.  In any event, much of the evidence in this case is incontrovertible or not in dispute and the accident was partially captured on closed circuit television. The minor blemish in the Plaintiff’s evidence has little insignificance.  I consider the Plaintiff overall credible.

9.  The 3^rd Defendant called two witnesses: Mr Kam Yau-chim (“Kam”) and Mr Cheng Ka Chun (“Cheng”).  Kam is a salesman at the 3^rd Defendant’s outlet who was involved in the rescue of the Plaintiff after the accident occurred.  His evidence was not challenged.  Cheng joined the 3^rd Defendant in 2008 as its logistics manager.  He left in July 2010 and re-joined in October 2010 as a sales manager.  He gave evidence about the routine operation in the warehouse and maintenance of the wheels of the cages used in transportation of goods.  That evidence is not in serious dispute.  Ms Lee doubted the reliability of his evidence about the wheels.  In the end, nothing really material turned on that aspect of his evidence.  I accept Kam’s and Cheng’s evidence.

The accident

10.  On 29 October 2010, the Plaintiff and his co-worker collected a load of goods from the 3^rd Defendant’s warehouse.  The goods were loaded on pallets and cages by the 3^rd Defendant’s staff and then pushed from the platform of the warehouse into the Plaintiff’s lorry.  Then the Plaintiff drove off and parked the lorry at the entrance of the outlet.  He lowered the tailgate and started to unload the goods with his co-worker.  The accident was partially captured on the 3^rd Defendant’s closed circuit television.  The fact that it occurred and how it occurred is incontrovertible.  The dispute is whether it was caused by malfunction of the wheels of the cage in question; negligence in the loading of the cage and various breaches of common law duty of care and statutory duties. 

11.  Shortly before the accident, the Plaintiff pulled a pallet of goods on a trolley out from the lorry and left it at the entrance of the outlet.  While his co-worker was removing the goods into the outlet, the Plaintiff went to the lorry to remove the laden cage.  It is the Plaintiff’s pleaded case that while he was pulling the laden cage from the tailgate onto the pavement, one or more of its wheels got caught in the gap between the tailgate and the pavement.  This is supported by the recording which depicts the Plaintiff in a half-squatting position on the pavement and seemingly applied considerable force to pull the bottom of the laden cage from the tailgate onto the pavement.  Then, as he continued to pull, the cage toppled.  He tried to prevent the fall by pressing his head against the toppling cage, but without success.  The cage fell on him and pressed him down onto the ground.  He suffered fracture dislocation of his cervical spine and is now a paraplegic.

WHETHER THE 3^RD DEFENDANT IS A PRINCIPAL CONTRACTOR

12.  The Plaintiff pleaded in paragraph 2 of his Re-Amended Statement of Claim (“RASOC”) that he was an employee of the 1^st and/or 2^nd Defendants, in paragraph 5.6 that the 3^rd Defendant was the principal contractor of the 1^st and 2^nd Defendants and again in paragraph 6 that the 1^st and 2^nd Defendants were sub-contractors of the 3^rd Defendant.  Though Mr Leung submits that these issues are irrelevant, he argued those issues at some length.  That argument was not pursued in Ms Lee’s final submission.  It seems that she was confident with Plaintiff’s chance of success in negligence and called those issues “icing on the cake”. 

13.  Whether the Plaintiff was an employee of the 1^st and/or 2^nd Defendants may have some bearing on his claim for breach of statutory duty under the Occupational Safety and Health Ordinance.  But whether the 3^rd Defendant was the principal contractor of the 1^st and/or 2^nd Defendants is neither here nor there because a person, whether an employer of an independent contractor or a principal contractor of a sub-contractor, is not vicariously liable for his independent contractor’s or sub-contractor’s torts unless he is made liable by statute such as the Employees’ Compensation Ordinance or is otherwise liable for other breaches of duty of care under the law of negligence: Luen Hing Fat Coating & Finishing Factory Ltd v Waan Chuen Ming[1].  Indeed, in Luen Hing Fat the Court of Final Appeal held that the defendant owed duty of care to an employee of an independent contractor in its capacity as the employer of that independent contractor and not as its principal contractor.  In Yates v National Trust[2], the court held that whether the claimant was an employee or a sub-contractor of the independent contractor employed by the defendant made no difference insofar as the issue of duty of care owed by the employer of the independent contractor was concerned. 

Whether the Plaintiff was an employee or independent contractor

14.  According to the Plaintiff, he was employed as a daily rate driver cum delivery worker.  He worked under the direction of the 1^st and 2^nd Defendants.  His duty was to drive the 2^nd Defendant’s lorry to deliver goods for the 3^rd Defendant.  If he wished to take leave, he had to apply for approval from the 1^st or 2^nd Defendants.  The 3^rd Defendant disputes this assertion but does not advance any positive case.  It challenged the Plaintiff’s evidence on the basis of a written agreement dated 17 September 2009 between the Plaintiff and the 2^nd Defendant in which the Plaintiff acknowledged he had no employment relationship with the 2^nd Defendant (the “Sub-contract Agreement”).  The Plaintiff admitted signing the agreement, but claimed to have no knowledge of its content. 

15.  The Sub-contract Agreement is a simple document written in Chinese.  There are only five simple clauses.  There is no suggestion that the Plaintiff was illiterate.  I do not believe that he had no knowledge of the content of the Sub-contract Agreement.  But it is all too common that employees enter into such “sub-contractual arrangement” to “cash-in” the statutory benefits under the Employment Ordinance, such as annual leave pay, statutory holiday pay and to “convert” their future entitlement to mandatory provident fund to present cash.  Likewise, employers enter into such arrangement because of the saving they could make by paying those statutory benefits at a discount.  I am satisfied that the Sub-contract Agreement was a bogus agreement to cover up the true relationship between the Plaintiff and the 2^nd Defendant.  It did not reflect their true intention.  I give no weight to that agreement.

16.  What is determinative of the true nature of the parties’ contractual relationship is not the label they put on their contract, but their intention as to their real contractual relationship.  There are indicia in their relationship from which that intention could be ascertained. In Lee Ting Sang v Chung Chi Keung & Anor[3], the Privy Council set out some of those indicia, including: the degree of control exercised by the alleged employer; whether the person who has engaged himself to perform the services was performing them as a person in business on his own account; whether he provides his own equipment; whether he engages his own helper; whether he bears his financial risk and responsibility for investment and management; and how far he has opportunity of profiting from sound management in the performance of his task, etc.  In Poon Chau Nam v Yim Siu Cheung[4], the Court of Final Appeal held that the proper approach to determine the true nature of the parties’ contractual relationship is to examine all the features of their relationship against the background of the indicia of their engagement with a view to deciding whether, as a matter of overall impression, the relationship is one of employment.   This involves a nuanced and not a mechanical approach of painting a picture from accumulation of details. 

17.  There is no dispute that the lorry was provided by the 2^nd Defendant.  That was an expensive piece of equipment for generating income and profit for the 2^nd Defendant.  Fuel, maintenance and insurance for the lorry were paid by the 2^nd Defendant.  All that the Plaintiff did was to drive the lorry to collect goods and deliver them to the 3^rd Defendant’s outlet as instructed by the 2^nd Defendant.  He bore no business risk and enjoyed no economic gain.  I consider the economic relationship between the parties carries more weight in the determination of the true nature of their contractual relationship.  Applying the approach of the Court of Final Appeal, I am of the overall impression that in reality the Plaintiff was engaged by the 2^nd Defendant under a contract of employment.  He was the 2^nd Defendant’s employee and not his sub-contractor.

Whether the 3^rd Defendant was a principal contractor

18.  Mr Leung argues that the 3^rd Defendant was not a principal contractor because it was not in the business of transportation, but was the end user of the transportation services provided by the 2^nd Defendant.  He submits that in that sense a principal contractor is just another name for a hirer or an employer of an independent contractor or an entrepreneur as an end user of services provided by an independent contractor in the characterization by Brennan J in Stevens v Brodribb Sawmilling[5].   To avoid confusion, I shall refer to that end user or an employer of an independent contractor as the entrepreneur.

19.  With respect to Mr Leung, the fact that the 3^rd Defendant was an end user of transportation services vis-a-vis the 2^nd Defendant gives only a partial picture of the total relationship between the entrepreneur, the 3^rd Defendant, and the 2^nd Defendant.  The fallacy in Mr Leung’s argument is that as between an entrepreneur and a contractor, or as between a contractor and its sub-contractor, or as between a sub-contractor and its sub-sub-contractor in a complex line of sub-contractorship, one must be the end user of the services provided by the other.  In my view, a “principal contractor” is a person whose ordinary business is to provide goods or services and who undertakes in the course of his business to provide such goods or services to the entrepreneur and does so by sub-contracting the whole or part of the work which it has undertaken to perform to another person (a sub-contractor) who may further sub-sub-contract to another sub-sub-contractor down the line. A principal contractor is involved in a tripartite (or multi-partite) relationship between itself, the entrepreneur as the ultimate purchaser of goods or end user of services, and between itself and its sub-contractor as supplier of the goods or services.  If there are only two parties involved in the way Mr Leung sees it, there could be no principal contractorship. 

20.  To understand the real relationship among all the parties, one must start from the ultimate end user, ie the entrepreneur or the employer of the principal contractor.  Here, the 3^rd Defendant was in the business of producing or otherwise acquiring goods and delivering them to its customers.  If the role of the 2^nd Defendant was only to deliver the goods, Mr Leung may argue that this is a bipartite relationship between the 2^nd and 3^rd Defendants respectively as the provider and end user of transportation services.  But on the fact, that was not the situation.  Under clause 1 of the DSC Agreement, the 2^nd Defendant’s duties were to deliver the goods sold by the 3^rd Defendant to its customers and, where necessary, to install them upon delivery.  Viewed in this light, the DSC Agreement was not a simple delivery contract under which the independent contractor’s obligation was only to deliver the goods, collect payment and leave as if the 3^rd Defendant were an end user of the services and the 2^nd Defendant a transportation contractor.  It was part of the 2^nd Defendant’s duty to install the goods, where installation was required.  The DSC Agreement included execution of part or some of the work, however minimal, which was undertaken by the 3^rd Defendant in the ordinary course or for the purposes of its trade or business.  The 3^rd Defendant was not a mere end user of the 2^nd Defendant’s transportation services.  Viewed in that light, the entrepreneur was the end user, the 3^rd Defendant was the principal contractor, and the 2^nd Defendant was a sub-contractor of the 3^rd Defendant.  There may be other sub-contractors in the production line in respect of the supply or acquisition of the goods, which I need not be concerned.  Accordingly, I find that the 3^rd Defendant was the principal contractor of the 2^nd Defendant.

The 3^rd Defendant’s liability as principal contractor under section 24(1) of the Employees’ Compensation Ordinance

21.  I now turn to examine the extent of the 3^rd Defendant’s vicarious liability under the Employees’ Compensation Ordinance.  Section 24(1) of the Ordinance provides as follows:

“ (1) Where any person (in this section referred to as the principal contractor), in the course of or for the purposes of his trade or business, contracts with a sub-contractor for the execution by or under the sub-contractor of the whole or any part of any work undertaken by the principal contractor, the principal contractor shall be liable to pay to any employee employed by that sub-contractor or by any other sub-contractor in the execution of the work any compensation under this Ordinance which the principal contractor would have been liable to pay if that employee had been immediately employed by him; …”

(My emphasis underlined)

22.  In Hip Hing Construction Co Ltd v Wong Leung-tak[6] the court adopted the test for principal contractor for the purposes of section 24(1) of the Employees’ Compensation Ordinance as whether the work sub-contracted to a sub-contractor was work which the principal contractor has undertaken to execute for his client.  Mr Leung submits that, applying this test, the 3^rd Defendant was not a principal contractor as it was not in the business of transportation but the end user of the 2^nd Defendant’s transportation services. 

23.  In substance, the definition of “principal contractor” under this subsection is no different from the ordinary meaning of “principal contractor” I adopted in paragraph 19, except that it is limited to principal contractors who have undertaken to execute work.  The 3^rd Defendant undertakes in the course of or for the purposes of its trade or business to supply, deliver and install goods, such as furniture, for its customers.  The customers were the entrepreneurs and the 3^rd Defendant was the provider of goods and services.  The 3^rd Defendant sub-contracted the delivery and installation work to the 2^nd Defendant.  It was therefore the principal contractor under this tripartite relationship. Applying the test in Hip Hing Construction Co Ltd, I find the 3^rd Defendant fell clearly within the definition of “principal contractor” under section 24(1) of the Employees’ Compensation Ordinance.   Furthermore, by compromising the Plaintiff’s claim under the Employees’ Compensation Ordinance, it is taken to have admitted to be the principal contractor within the meaning of section 24(1).

24.  Insofar as the duty imposed on a principal contractor by section 24(1) of the Employees’ Compensation Ordinance is concerned, it is a matter of statutory interpretation.  The Ordinance, as the authorities show, is a piece of social legislation.  The scheme under the Ordinance is to impose a “no fault liability” on the employer for injury suffered by his employee in an accident so long as it arose out of and in the course of the employee’s employment.  However, the scope of this “no fault” liability is limited.  It is defined by section 3 to mean statutory compensation for death, permanent incapacity, sick leave, prosthesis etc.  It does not include common law damages for negligence or other breach of duty. 

25.  This “no fault liability” of the employer has been extended to the principal contractor by section 24(1) of the Employees’ Compensation Ordinance.  In Tugu Insurance Co Ltd v Woo Kin Wah[7], Fuad VP held the principal contractor’s liability under section 24(1) is only limited to payment of statutory compensation under section 3 and does not cover an employee’s common law claims.  He said:

“ In my judgment, s.24 does not give an employee a right to claim anything other than compensation, as defined in s.3, against a principal contractor. An employee cannot rely on s.24 to make the principal contractor liable to him in an ordinary action for damages as if he had directly employed the employee. The section read in the context of the Ordinance as a whole makes this abundantly clear.”

Thus, the principal contractor’s liability is limited to payment of statutory compensation under section 24(1) only.  No estoppel in respect of any other common law claims is created by the principal contractor settling an employee’s compensation claim.  By compromising that claim, the 3^rd Defendant does not make itself vicariously liable for negligence or other breaches of duty owed to the employee by his direct employer.  The Plaintiff’s reliance on the 3^rd Defendant’s status as principal contractor within the meaning of section 24(1) of the Employees’ Compensation Ordinance to attach common law liability on the 3^rd Defendant is misconceived.  Any claim he may have against the 3^rd Defendant would have to be founded on breach of duty of care arising out of the relationship among him, the 2^nd and 3^rd Defendants or on other breach of duty imposed by statute.

NEGLIGENCE

The law

26.  The main issues raised by the Plaintiff’s claim in negligence are whether there was a duty of care owed by the 3^rd Defendant to the Plaintiff, breach of that duty and causation.  An employee of a sub-contractor is not privy to the contract between the sub-contractor and the principal contractor.  In the absence of contractual obligation, the principal contractor does not owe an employee of its sub-contractor any contractual duty of care for his safety.  The duty under the law of negligence, if any, arises under the neighbourhood principle as a result of the relationship between the parties.  As rightly submitted by Ms Lee, whether a duty of care is owed under the law of negligence depends very much on foreseeability, proximity and whether it would be fair, just and reasonable to impose a duty of care.  In Caparo Industries Plc v Dickman and Others[8], Lord Bridge of Harwich said[9]:

“ What emerges is that, in addition to the foreseeability of damage, necessary ingredients in any situation giving rise to a duty of care are that there should exist between the party owing the duty and the party to whom it is owed a relationship characterised by the law as one of “proximity” or “neighbourhood” and that the situation should be one in which the court considers it fair, just and reasonable that the law should impose a duty of a given scope upon the one party for the benefit of the other. But it is implicit in the passages referred to that the concepts of proximity and fairness embodied in these additional ingredients are not susceptible of any such precise definition as would be necessary to give them utility as practical tests, but amount in effect to little more than convenient labels to attach to the features of different specific situations which, on a detailed examination of all the circumstances, the law recognises pragmatically as giving rise to a duty of care of a given scope.”

27.  The Caparo principle was adopted by the Court of Final Appeal in Luen Hing Fat Coating & Finishing Factory Ltd v Waan Chuen Ming[10].In that case, Bokhary PJ referred to various subsequent authorities explaining Caparo.  He said that these three elements of foreseeability, proximity and whether it would be fair, just and reasonable are just convenient labels.  There is no real demarcation between them and they shade into each other.  They may be seen as an umbrella covering a number of disparate circumstances in which the relationship between the parties is so close that it is just and reasonable to impose a duty of care.  This is a question of value judgment.  An important consideration is the danger to life and limb, where personal safety of the person affected is at stake.  This is particularly so where the person affected is in a vulnerable position.  His Lordship concluded that ultimately it is necessary to stand back and take a holistic view of foreseeability, proximity and the need to be satisfied that it would be fair, just and reasonable to impose a duty of care[11].  Considerations of fairness, justice and reasonableness were an intrinsic element of the duty of care and could be employed to ground the imposition of a duty where no such duty had previously existed, or where a duty had previously been denied.  Where the danger was to life and limb and personal safety is at stake, the standard of care demanded is high and involved legal policy. 

Duty of care

28.  Whether a duty of care was owed by the 3^rd Defendant to the Plaintiff has to be considered against the following background.  There was no contractual relationship between the Plaintiff and the 3^rd Defendant.  The 3^rd Defendant contracted its delivery and installation work to the 2^nd Defendant under the DSC Agreement.  The Plaintiff was an employee of the 2^nd Defendant engaged in the performance of the DSC Agreement.  The accident arose out of the use of a cage and in the course of delivering goods for the 3^rd Defendant under the DSC Agreement.  The cage was provided by the 3^rd Defendant for the use of the Plaintiff for that particular purpose.  It was maintained by the 3^rd Defendant.  The Plaintiff had no choice of other containers.  The goods to be delivered were packed into the cage by the 3^rd Defendant’s staff.  The Plaintiff had no control on how and how heavily it was to be loaded and how many items were to be packed inside the cage.  The laden cage was moved into the lorry by the staff of the 3^rd Defendant.  The Plaintiff was to deliver the laden cage to the 3^rd Defendant’s outlet in performance of the DSC Agreement. 

29.  It must be reasonably foreseeable that if the cage was not properly maintained and the wheels were jammed or not fully functional, it may topple if pushed or pulled.  It must also be reasonably foreseeable that if the cage was not properly loaded resulting in a high centre of gravity or imbalance, it would increase the risk of toppling, if pushed or pulled.  If the cage should topple in the course of delivery by the Plaintiff, it would cause injury to the Plaintiff.

30.  Applying the three fold test, I have no difficulty to find that considerations of fairness, justice and reasonableness would impose a duty of care on the 3^rd Defendant.  The next question is: what was the extent or content of that duty.  Given the above analysis, there could be no doubt that the 3^rd Defendant had a duty to maintain the cage and see to it that it functioned properly, in particular that the wheels moved freely and were not jammed and that the latches were secure so that goods would not fall out of the cage.  It also had a duty to see to it that the cage was properly loaded with heavy items below and light items on top so as to keep the centre of gravity low; that the goods were stable and would not shift about inside the cage as to affect its stability or balance; and it was not overloaded making it difficult or dangerous to push.

31.  Ms Lee argues that the 3^rd Defendant’s duty of care was more extensive than that.  It includes a duty to advise the employees of its sub-contractor to push the laden cage instead of pulling it; a duty to warn them of the danger of pulling the laden cage; and a duty to exercise care in the selection of the sub-contractor. 

32.  The 3^rd Defendant’s logistics manager, Cheng, admitted during cross-examination that he knew that the cage was better pushed than pulled.  Relying on the Caparo principle and Luen Hing Fat[12], Ms Lee submits that the 3^rd Defendant had a duty to impart this information to the Plaintiff who was having his hand on the delivery work.  She stresses that the operation was dangerous as the cage was heavy; that there was danger to life and limb; that the employee was in a vulnerable position and that the standard of care demanded was high.  She submits that the present case is on all fours with Luen Hing Fat and urges me to find that a duty of care existed.  Mr Leung argues otherwise because the cage is a common piece of equipment in general use in transportation of goods and the risk is obvious. Before considering Ms Lee’s submission based on Luen Hing Fat, it is important to understand what was the content of the duty of care which the Court of Final Appeal was discussing in that case because it would be futile to discuss about duty of care in abstract without knowing its content. 

33.  In Luen Hing Fat, the entrepreneur engaged an independent contractor to repair a machine in its factory.  The plaintiff was an employee of the independent contractor instructed to perform the work.  The work was not hazardous.   The entrepreneur lent the independent contractor two pieces of equipment, namely two pallet jacks and a bearing trolley which were normally used to transport cloth.  The equipment was not intrinsically dangerous or faulty for their usual purpose. But it was used by the independent contractor to do work by an unsafe method, namely to install part of the machine which weighed 1.5 tons.  The entrepreneur’s supervisor knew that would happen.  He, nevertheless, lent the equipment and did not take any steps to warn against such use.  While so using the equipment, the machine fell crushing the plaintiff’s legs.  Applying the three-fold test, the Court of Final Appeal found a duty of care owed by the entrepreneur to the employee of the independent contractor.

34.  To understand the content of the duty of care which the Court of Final Appeal found, it is necessary to refer to the question of law posed before the Court of Final Appeal.  That question is set out in paragraph 2 of the judgment, which reads: 

“ 2.  The question of law on which leave to appeal to this Court was granted is whether there is a duty of care owed by X to Y in the following circumstances :

(1) X engages an apparently competent independent contractor to do work on X’s premises.

(2) The work is not intrinsically hazardous.

(3) X lends the independent contractor equipment which is not intrinsically dangerous or faulty.

(4) As X knew or ought reasonably to have known would happen, the independent contractor uses that equipment to do the work by a method which is unsafe. 

(5) Y, who is a servant of the independent contractor, is injured as a result. 

In the present case, X represents the appellant Luen Hing Fat Coating & Finishing Factory Ltd (“the Factory Operator”) and Y represents the respondent Mr Waan Chuen Ming (“the Worker”).”

35.  From the above question of law, it can be seen that there were two important elements in the relationship between the entrepreneur, the independent contractor and its employee.  First, the entrepreneur knew, through its supervisor, that the independent contractor would use the entrepreneur’s equipment to do work by a method which is unsafe. Second, with that knowledge, the entrepreneur lent the equipment to the independent contractor.  In coming to his conclusion that a duty of care arose, Bokhary PJ said, after referring to the above two elements[13]:

“ 45. …Nevertheless neither [the supervisor] nor his employer [the entrepreneur] took any steps to stop or even to warn against it. As to why not, he explained, it will be remembered, that he trusted that the Independent Contractor could manage the operation. But how far can one reasonably trust someone to manage an operation without mishap when he proceeds in an extremely unsafe manner? It being a supervisor’s function to supervise, [the supervisor’s] knowledge is to be attributed to his employer the [entrepreneur]. And his failure to act on that knowledge is its failure.

46. Moreover the [entrepreneur’s] position is adversely affected by something besides its employee [supervisor’s] omission. It had taken a positive part, thus assuming a positive role, in the creation of the danger, doing so by lending the [entrepreneur’s] equipment which it knew or ought reasonably to have known would be used to do the work by an unsafe method. Such participation, too, goes to it being fair, just and reasonable to hold that the [entrepreneur] owed the Worker a duty of care. Indeed, such participation lies at the heart of the Worker’s case against the [entrepreneur] in negligence, and justifies the result reached by the majority in the Court of Appeal.

47.  The question of law on which leave to bring this appeal was granted is set out in the opening paragraph of this judgment.  I would answer it thus.  A duty of care can arise in circumstances such as those described in that question.  And such a duty did arise on the particular facts of this case.”

(My emphasis underlined)

36.  From the above passage, it can be seen that the duty of care which Bokhary PJ was discussing was not a duty in the selection of sub-contractor, though he criticised the entrepreneur’s avowed reliance on the judgment of the independent contractor; or a duty in the selection of employees of the independent contractor; and still less a duty to warn of danger simpliciter. The duty of care which his Lordship was discussing was one which arose out of the entrepreneur’s lending of the equipment to the independent contractor with the knowledge that it would be used to perform the contracted work for the entrepreneur by an unsafe method.  His Lordship then held that in so doing, the entrepreneur participated in creating a danger which the employee was subjected to.  If it is necessary to give a description to that duty, it is a duty, having participated in the creation of a danger in the work method to be adopted in the execution of work which he contracted to the independent contractor, to warn the employees of the independent contractor of the danger which is known to the entrepreneur.  It is important to bear in mind that the two conditions necessary for creation of the duty must be met before the duty to warn of the danger would arise.  The two conditions are participation in the creation of the danger and knowledge of the danger.  The duty is to warn of that danger and the failure to warn constitutes breach of that duty. 

37.  Providing equipment to be used in the work contracted as in the present case is no different from lending of equipment as in Luen Hing Fat.  That said, Luen Hing Fat is distinguishable from the present case.  According to Kam, he used to see the Plaintiff and his co-worker moving a laden cage together, with the Plaintiff pushing and his co-worker holding the cage.  That was a proper method of handling the laden cage.  This evidence was not challenged.  There is, therefore, no evidence that the 3^rd Defendant or its staff had knowledge that the equipment would be used in a dangerous manner.  Besides, it is not the Plaintiff’s case that the 3^rd Defendant advised him to move the cage by pulling.  The 3^rd Defendant had done nothing to contribute to the creation of the danger which the Plaintiff was subjected to.  The two conditions necessary for creation of the duty to warn are not met.  The duty does not arise.

38.  Furthermore, as for the duty to warn of the danger of an equipment simpliciter, Mr Leung referred me to the case of Makespeace v Evans Brothers (Reading) & Anor[14]. The claimant in that case was an employee of a sub-contractor who was engaged by the main contractor to undertake painting work in a residential site.  The claimant had to perform painting work on a tower scaffold provided by the main contractor.  He fell from the tower scaffold which toppled either because the outrigger was not installed properly or the balance had been upset.  At first instance, the trial judge dismissed the claimant’s claim against the main contractor.  In dismissing his appeal, Mantell LJ emphasised that a tower scaffold is a commonplace piece of equipment in general use by builders, painters and others who need to work at height and the precautions that need to be taken when using such commonplace piece of equipment should have been obvious[15].

39.  The same could be said of the laden cage. Despite it was provided by the 3^rd Defendant, it is a very common piece of equipment in general use in transportation of goods.  The 2^nd Defendant was an independent contractor in transportation business and had been employed by the 3^rd Defendant for more than two years prior to the accident.  The operation was a very simple one.  The goods were loaded into the pallets and cages by the 3^rd Defendant’s staff and then pushed into the Plaintiff’s lorry.  The Plaintiff’s duty was to drive the lorry to the outlet and then unload the pallets and cages.  It required no technical or special knowledge, but common sense.  The Plaintiff ought reasonably be expected to know the danger attendant upon handling such a common piece of equipment and to exercise ordinary skills and judgment.  Indeed, Kam’s unchallenged evidence is that the Plaintiff was aware of such and other attendant risks and had handled the laden cages in a proper manner.  It is just a matter of common sense.  Though the laden cage was heavy, the risk was just the ordinary risk which common sense could avoid.  The entrepreneur is entitled not only to rely on the expertise of the contractor and his employees in the performance of the contracted work, but also to expect them to exercise common sense in performing the contracted work.  In my opinion, an entrepreneur has no duty to advise or warn employees of his independent contractor of risks attendant to the use of commonplace equipment in general use by employees in the type of work in which the independent contractor is engaged.  This is because such risks are obvious and could be avoided by exercise of common sense which the employees are expected to exercise.   If an employee chooses not to exercise common sense, there is no risk which care on the part of the entrepreneur or principal contractor can avoid.

40.  Thus, applying the three-fold test, I am unable to impose on the 3^rd Defendant a duty to warn or instruct the Plaintiff that the cage should be pushed and not pulled; that the goods inside the cage were liable to displace and shift; that the cage should not be pulled when its wheels were stuck between the tailgate and the road and/or the pavement; and that there are other attendant risks or inherent dangers of the operation as pleaded in the RASOC.

41.  Next, Ms Lee argues that the 3^rd Defendant failed to personally verify that the 2^nd Defendant was capable of performing the DSC Agreement and giving proper instructions to his employees.  What its logistics manager did was only to ask the 2^nd Defendant about his experience and made enquiries from other transportation companies about his performance.  Ms Lee therefore submits that in selecting the 2^nd Defendant, the 3^rd Defendant only relied on hearsay opinion without making any verification personally.  This is an un-pleaded duty, but is nevertheless argued at length by counsel.  I shall consider the arguments.  If meritorious, I shall allow an amendment to the pleading and invite counsel for full argument.

42.  It is Mr Leung’s argument that an entrepreneur owes no duty of care in his choice of independent contractor to an employee of the independent contractor chosen.  He referred me to Yates v National Trust[16].  In that case, National Trust engaged an independent contractor to fell a tree which was diseased and dying.  The independent contractor instructed the plaintiff Yates, a tree surgeon, to climb and fell the tree.  Yates was either an employee or a sub-contractor or of the independent contractor, but that has no bearing on the legal principle.  While performing his work, Yates fell from the tree, because of his accidental cutting of his ropes; a branch or anchor point of his rope had given way; or he had inadvertently detached himself from one point before he was safely attached to another.  He sued the National Trust.  One of his allegations was that National Trust had not taken reasonable care to see that the men employed by the independent contractor for the job were suitably qualified and trained.  Nicol J held that the Occupiers’ Liability Act 1957 was not relevant because Yates was not injured due to the state of the premises (“occupancy risk”) but because of his activity as a tree surgeon (“activity risk”).  The learned judge then went on to hold obiter that even if the Occupiers’ Liability Act 1957 had been applicable, National Trust would still owe Yates no duty of care in relation to its choice of independent contractor and the risk presented by the tree were the risks ordinarily incident to the calling of a tree surgeon.

43.  On the issue of an entrepreneur’s duty of care in the choice of independent contractor, Nicol J said[17]:

“ An employer of course owes a duty of care to his employee amongst other things in relation to the system of work which is adopted and to see that the employee has the appropriate training or experience for the tasks which the employer gives him. But the Claimant was not the employee of the [National Trust]. He was the employee or sub-contractor of the [National Trust’s] independent contractor. It is unusual for the hirer of an independent contractor to owe a duty of care to the contractor’s employees of a comparable kind.”

44.  I agree entirely with Nicol J.  An entrepreneur contracts for work to be executed by an independent contractor. He pays the independent contractor for the work to be executed. He relies on his skill and experience in the performance of the work entrusted to him.  Who the independent contractor employs for the execution of the work is a matter of judgment or business decision for the independent contractor, which the entrepreneur should be least concerned.  As was held by Nicol J, an employer owes duty of care to his employees, amongst other things, to see to it that the employees have appropriate training or experience for the task for which they are assigned.  In relation to an individual employee, the employer has a duty to see to it that that employee’s co-workers are appropriately trained and competent for the task assigned and would not constitute a burden or danger to that individual employee.  But it is difficult to see why it could be fair, just and reasonable that an entrepreneur who has contracted the work out to an independent contractor should be burden with such a duty.  It is also difficult to see how that duty could be discharged, without requiring the entrepreneur to be involved in the day to day administration of the work of the independent contractor.  It lies ill in the employee’s mouth to tell the entrepreneur that the entrepreneur had not taken reasonable care to see to it that he was suitably experienced and qualified to be employed by the independent contractor for the contracted work.

45.  It is of course true that an entrepreneur owes duty of care in relation to his choice of independent contractor to third parties likely to be affected by the work to be executed by his independent contractor.  But that duty is not owed to employees of the independent contractor to whom he contracted the work.  The employees of the independent contractor represent the independent contractor and can reasonably be treated as the executive arm or part and parcel of the independent contractor.  They are not third parties in relation to that duty of care.  The position of the principal contractor is no different from that of the entrepreneur.  Applying the three fold test, I am unable to find it fair, just and reasonable to impose such a duty of care on the 3^rd Defendant.

46.  By way of conclusion, I find that the relationship of the Plaintiff and the 1^st to 3^rd Defendants was such that it was fair, just and reasonable to impose a duty of care on the 3^rd Defendant:

(1) to maintain the cage and see to it that it functioned properly, in particular that the wheels moved freely and were not jammed and that the latches were functional so that goods would not fall out of the cage; and

(2) to see to it that the cage was properly loaded with heavy items at the bottom and light items on top so as to keep the centre of gravity low; that the goods were reasonably stable and would not shift about inside the cage as to affect its stability or balance; and it was not overloaded making it difficult or dangerous to push.

Breach of duty – maintaining the cages

47.  The Plaintiff’s complaint about the cage is that the latch was defective and that the wheels did not run smoothly at all times. The complaint about defective latch is un-pleaded.  However, on the evidence, nothing turned on that complaint.  There is no evidence to suggest that the latch of the laden cage in question was defective or that it had in any way contributed to the accident.

48.  According to Cheng, since 2004 the cages were all fitted with expensive and good wheels.  The wheels were free to turn in all directions.  If force is applied in one direction, they will align themselves and move in that direction.  He said that the wheels ran very smoothly.  He admitted that if a wheel was not running smoothly, the cage would not be immediately taken for repair, but would be delivered to Dongguan for repair as a lot as and when it was convenient.  The cage in question had not been examined after the accident.  There is no evidence whether its wheels were in running condition.  But equally, there was no contemporaneous complaint by the Plaintiff that the wheels were defective and caused the accident.  In fact, according to what he told the police officer who attended the scene, the accident was caused by his pulling the laden cage with force when its wheel was (or wheels were) caught in the gap between the tailgate and the pavement.  There was no mention by him of any defect in the wheels. 

49.  From the recording, it could not be seen what caused the laden cage to topple except the pull by the Plaintiff.  As there is no dispute that laden cage had been moving smoothly while it was on the tailgate, the only reasonable inference is that its wheel was (or wheels were) caught between the tailgate and the pavement or obstructed by the kerb and the Plaintiff’s pull caused it to topple.  Having regard to the size of the wheels and the difference in level between the surface of the road and that of the pavement, it is plainly impossible to push or pull the cage by direct force onto the pavement.  It is just common sense that one has tilt the cage backwards so as to land its front wheels on the pavement and then lift and push it up from behind onto the pavement.  Having regard to the height of the cage and its higher centre of gravity, safety and common sense would also require a co-worker to hold the cage and assist in lifting it up onto the pavement, just as the Plaintiff and his co-worker had often been seen to have done in the past. Pulling the cage from the front as the Plaintiff did was asking for the cage to topple.  The accident had nothing to do with the design of the cage or the maintenance of the wheels.  There is also no evidence that any of the wheels was defective and that the 3^rd Defendant had been negligent in maintaining the cage or its wheels.  There was neither breach of duty on the part of the 3^rd Defendant or causation.

Breach of duty – loading the cage

50.  The cage was provided by the 3^rd Defendant and packed by its warehouse staff.  It was loaded with electrical and electronic goods.  Cheng estimated that the laden cage weighed 60 to 70 kilogrammes.  Kam, who was involved in rescuing the Plaintiff gave an estimate of 140 kilogrammes.  The cage measured 187 centimetres in height, 79 centimetres by 89 centimetres on the base.  Having viewed the photograph of the laden cage and having regard to its size, the type of goods which were loaded in the cage, the packing material used for packaging electrical and electronic goods, and the void spaces inside the cage, it probably weighed near the lower end to the middle of the 70 and 140 kilogrammes range.  The fact that the Plaintiff was able to move it alone by himself from the lorry to the tailgate supports that inference.  Ms Lee suggests it was heavy as it took four persons to lift the cage up after the accident.  The truth as the recording shows is that immediately after the accident occurred, two of the 3^rd Defendant’s staff rushed to the rescue and were already lifting up the cage when the Plaintiff’s co-worker and a woman passer-by joined in.  That does not mean it required four persons to lift up the cage.  I give more weight to Cheng’s estimate because he had been charged with the duty of managing the logistics department and had a few years on the job experience supervising and observing the loading of the trolleys in the warehouse, while Kam’s estimate might have been affected by the shock and trauma created at the sight of the accident.  I do not consider the cage as having been overloaded as to render it a danger to push around.   

51.  According to Cheng, he instructed his warehouse staff to load the heavier items on the bottom of the cage and the lighter items on top so as to keep the centre of gravity low and the cage stable and balanced. Indeed, the photograph shows that the cage was well packed.  The goods were contained in boxes with the large boxes at the bottom, suggesting, as Cheng said, the heavier goods were loaded at the bottom.  There were no loose items which would shift inside the cage and cause the cage to topple or increase the risk of toppling while being pushed or pulled.  After the accident, the laden cage was restored to an upright position and it was capable of standing alone in a tilted position without any support.  The goods inside the cage remained in position and were apparently not disturbed by the fall.  All these incontrovertible evidence supports Cheng’s evidence that the cage was properly packed according to his instructions.  There is no evidence of any breach of duty by the 3^rd Defendant in packing and loading the cage.

Conclusion

52.  For the above reasons, I find that the Plaintiff has failed to prove any breach of duty of care on the part of the 3^rd Defendant.  The accident was caused solely by the Plaintiff’s pulling the cage from the road onto the pavement.  The Plaintiff’s claim in negligence fails.

CLAIM UNDER OCCUPATIONAL SAFETY AND HEALTH ORDINANCE

The scheme under the Occupational Safety and Health Ordinance

53.  Before dealing with the Plaintiff’s claim for breach of statutory under the Occupational Safety and Health Ordinance, it would be useful to set out the scheme of safety and health protection under the Ordinance.  This is another piece of social legislation.  The purpose of this Ordinance as stated in section 2 is to ensure and improve safety and health of employees when they are at work.  Section 2 reads:

“ The purposes of this Ordinance are as follows-

(a) to ensure the safety and health of employees when they are at work;

(b) to prescribe measures that will contribute to making the workplaces of employees safer and healthier for them;

(c) to improve the safety and health standards applicable to certain hazardous processes, plant and substances used or kept in workplaces;

(d) generally to improve the safety and health aspects of working environments of employees.”

The coverage given to protecting employees at work is very wide.  “Workplace” is given a very wide definition in section 3, meaning, with but a few statutory exceptions, practically any place where employees work.

54.  These purposes are to be achieved by imposing a statutory duty under the Ordinance on the “person responsible for the workplace”. That person is defined in section 3(2) as follows:

“ For the purposes of this Ordinance, the person responsible for a workplace is the employer of the employees who are employed to carry out work there, or if the employer does not exercise any degree of control over the relevant part or aspect of the workplace, means the occupier of the workplace.”

This definition provides an alternative defendant, namely the “occupier of the workplace” instead of the direct employer and charges him with responsibility for the safety and health of employees in the workplace over which the occupier has control when the employer has not.  It is important to note that by this definition it is only if the employer does not exercise any degree of control over the workplace or the relevant part of the workplace that the responsibility is passed to the occupier. The word “or” in that definition has to be read disjunctively and the responsibility is shifted to the occupier only if the condition that the employer does not exercise any degree of control over the relevant part or aspect of the workplace is met.  If the employer exercise any control over the workplace, the responsibility will not be passed to the occupier.  Even if both the employer and occupier have some degree of control over the workplace, the responsibility remains the employer’s.  The primary person responsible for discharging these statutory duties is the employer. 

55.  “Occupier of the workplace” is defined in section 3 as follows:

“ “Occupier” in relation to any premises or workplace, includes a person who has any degree of control over the premises or workplace and, in particular, includes a person to whom subsection (5) or (6) applies;”

Though an inclusive definition is provided, the essence in the occupier of the workplace must be his power to exercise control, in addition to the fact of his occupation of the workplace.

56.  Sections 6 and 7 impose responsibility for safety and health of employees at work on, respectively, the employers and the occupiers.  The duties imposed on the employers are much more onerous than those on the occupiers.  The employer must ensure so far as reasonably practicable, the safety and health at work of all his employees; whereas the occupier is only required to ensure that the premises, the means of access to and egress from the premises, and any plant or substances kept therein, are, so far as reasonably practicable, safe and without risks to health.  The difference in standard is reasonable as the primary responsibility for the safety and health of the employees is the employers’.  It should be noted that the responsibility under section 6 is imposed specifically on the employer and not on the person responsible for the workplace.  Thus, even if the employer has no control of the workplace, the responsibility would not be shifted to the occupier.

57.  Besides these essential duties, there are specific duties imposed by the Occupational Safety and Health Regulation on the person responsible for the workplace.  These duties are more of a technical nature.  As explained above, the person primarily responsible for discharging these duties is the employer.  Only if the employer does not exercise any degree of control would the responsibility be landed on the occupier who has control over the workplace or the relevant part of it. 

Discussion

58.  In paragraph 16 of the RASOC, the Plaintiff alleged that the accident was caused and/or contributed to by breaches of statutory duty under the Occupational Safety and Health Ordinance on the part of all the three defendants, their servants or agents.  He then pleaded breaches of section 6(1), 6(2)(b), 6(2)(c) of the Ordinance and breaches of regulations 23(1), 24, 27(1)(a), 27(1)(b), 27(1)(c), 30(1) and 31(1) of Occupational Safety and Health Regulation. 

59.  Mr Leung submits that since the responsibility for discharging the duties under section 6 is the employer’s, ie the 1^st and 2^nd Defendants, the 3^rd Defendant could not in any way be liable, even if there were any breaches of those subsections under section 6 as pleaded.  That is plainly correct.  The Plaintiff’s claim under section 6 as pleaded in paragraph 16.1 to 16.3 of the RASOC must be struck out.

60.  As for the claims for breaches of the regulations, it is the Plaintiff’s pleaded case under paragraph 8 of the RASOC that the 1^st, 2^nd and 3^rd Defendants were each the person responsible for the workplace within the meaning of the Occupational Safety and Health Ordinance and the Occupational Safety and Health Regulation.  This plea has landed the Plaintiff in un-resolvable difficulties.  The workplace of course means the part of the pavement and the road where the accident occurred.  The plea is tantamount to an assertion and admission that the 1^st and 2^nd Defendants exercised some control over the workplace and were persons responsible for the workplace where the accident occurred.  As explained in paragraph 54 above, that excludes the 3^rd Defendant, even if it was the occupier having any degree of control over the pavement, from being the person responsible for the workplace.  The Plaintiff’s own plea destroys the basis of his claim for breaches of the regulations against the 3^rd Defendant.

61.  It is regrettable that the Plaintiff should have included the 1^st and 2^nd Defendants in paragraph 8 of the RASOC in such a sweeping manner without putting in an alternative plea directed at the 3^rd Defendant or excluding the 1^st and 2^nd Defendants from paragraph 16.  If the Plaintiff’s case is at all curable by an amendment, I shall consider inviting an application to amend the RASOC. 

62.  However, on the evidence, the Plaintiff is bound to fail in respect of this claim for breach of statutory duty under the Occupational Safety and Health Ordinance.  The Plaintiff has the burden of proving not only that the 3^rd Defendant was the occupier exercising some control over the workplace, but also that the 1^st and/or 2^nd Defendants did not exercise any control.  

63.  The workplace was the place where the Plaintiff worked.  It covered the area where he parked his lorry and the passage from the tailgate of the lorry to the pavement just outside the entrance of the 3^rd Defendant’s outlet.  All that area was a public place to which the public had access.  No one was in exclusive occupation.

64.  The recording shows that the Plaintiff pulled one pallet of goods on a pallet trolley from the lorry onto the pavement to a position just outside the entrance of the outlet and left the pallet there.  He then entered the outlet, presumably to attend to some documentation.  Shortly afterwards, he returned and removed the plastic sheet covering the goods on the pallet.  Then his co-worker, a young man in black, unloaded the goods from the pallet.  Then the Plaintiff went on to his last delivery.  During all that time, the employees of the 3^rd Defendant, men in orange colour T-shirts or jackets, stayed within the boundary of the outlet.  None of them ever set their foot on the pavement.  Who exercised any control over the workplace?

65.  The test of control is not physical presence but the power to assert control.  Presence is some evidence of the power to assert control.  None of the 3^rd Defendant’s employees were on the pavement.  One employee looked at the goods on the pallet from the outlet.  But he did nothing to the goods.  He did not remove them.  On the other hand, the Plaintiff and his co-worker were actively dealing with the goods and were in occupation of the pavement at various times.  This is prima facie evidence of the power to assert control on the part of the Plaintiff and his co-worker; but absence of the same on the part of the 3^rd Defendant.

66.  More importantly is this. At the material time and place, the 2^nd Defendant was performing the DSC Agreement.  He was delivering goods in the performance of that agreement through his employees, the Plaintiff and his co-worker.  It was his contractual obligation to take delivery of the goods from the 3^rd Defendant’s warehouse, transport them to the outlet, delivered them to a responsible staff of the 3^rd Defendant at the outlet and obtain his receipt or acknowledgment of the delivery.  He was responsible for loss in transit.  He was the bailee and had possession of the goods until they were delivered and acknowledged by the staff of the 3^rd Defendant.  Thus, the 2^nd Defendant, through his employees had possession of the goods while they were in transit on the pavement or left outside the outlet on the pavement.  He had occupation of the workplace.  The Plaintiff and his co-worker had power to prevent obstruction of the passage of the goods while on the pavement and had power to prevent tampering of the goods while they were on the pavement.  They must have some degree of control over the pavement.  It is trite law that an employer who sent his employees to a workplace may be treated as exercising control of the workplace through such employees: Brackenborough v Spalding Urban District Council[18].  By way of contrast, none of the 3^rd Defendant’s staff had ever set their foot on the pavement.  As explained in paragraph 54, if the employer exercises any control over the workplace, it would exclude an occupier from being the person responsible for the workplace.  Accordingly, the 3^rd Defendant could not be the person responsible for the workplace at the time of the accident and had no responsibility under the regulations pleaded.  I do not find it necessary to consider the very lengthy submissions on the law by Mr Leung about breaches of those regulations.  Ms Lee did not respond to those submissions.   I assume she has no dispute with the law as submitted by Mr Leung.  But that is beside the point.

67.  In conclusion, the Plaintiff’s plea is incurable and his claim for breaches of statutory duties under the Occupational Safety and Health Ordinance is dismissed.

CLAIM UNDER OCCUPIERS LIABILITY ORDINANCE

68.  The Plaintiff’s case of breach of statutory duty under the Occupiers Liability Ordinance is founded on two basis: first, the 3^rd Defendant was the owner and occupier of the laden cage; and, second, it was the occupier of the workplace where the accident occurred.  Section 3(2) of the Occupiers Liability Ordinance imposes on the occupier of premises a duty to take such care as in all the circumstances of the case is reasonable to see that the visitor will be reasonably safe in using the premises for the purposes for which he is invited or permitted by the occupier to be there.  The law on occupiers liability is succinctly summarized in the following dicta of Bingham J in Marney v Scott[19]:

“ I think that a man who intends that others shall come upon property of which he is the occupier for purposes of work or business in which he is interested, owes a duty to those who do so come to use reasonable care to see that the property and the appliances upon it which it is intended shall be used in the work are fit for the purpose to which they are to be put, and he does not discharge this duty by merely contracting with competent people to do the work for him. If the parties with whom he so contracts fail to use reasonable care and the damage results, the occupier still remains liable.”

Mr Leung disputes whether the laden cage could be occupied by the 3^rd Defendant and whether the 3^rd Defendant was the occupier of the workplace, namely the relevant section of the pavement outside the outlet.

69.  Both Mr Leung and Ms Lee referred me to Wheeler v Copas[20]in support of their arguments.  Mr Leung submits that the cage was no more than a chattel in the hands of the Plaintiff and his co-worker and was not capable of being occupied.  In reply, Ms Lee argues that the cage was capable of occupation just as a ladder in Wheeler v Copas; and she quotes the following dictum of Chapman J:

“ It is true it covers moveable structures, such as vessels, vehicles and aircraft. I do not doubt that in appropriate circumstances it could apply to a ladder, …”

70.  I think both counsel are arguing at cross purposes.  In Wheeler v Copas, the defendant was the owner of a farm.  He lent a ladder to his contractor for work in his farm.  The plaintiff who was employed by the contractor fell from the ladder when it snapped.  He sued in negligence and under the Occupiers’ Liability Act 1957. Bingham J allowed his claim based on negligence but dismissed his claim based on the Occupiers’ Liability Act 1957.  He held[21]:

“ The plaintiff puts his case to a considerable extent on the Occupiers’ Liability Act 1957, but it seems to me that there may well be considerable difficulty in relation to that because that Act is dealing with an occupier. It is true it covers moveable structures, such as vessels, vehicles and aircraft. I do not doubt that in appropriate circumstances it could apply to a ladder, but I see considerable difficulty in saying that once the defendant had handed the ladder over to the plaintiff and his partner for the purpose of bricklaying the defendant was still the occupier of this ladder.”

In short, Bingham J recognised that a ladder could in appropriate circumstances be a structure which is capable of being occupied; but he found it difficult to find on the fact that the ladder was occupied by the defendant when the defendant had handed it over to the plaintiff.  Ms Lee is relying on the first proposition while Mr Leung is relying on the final proposition which was decisive in that case.

71.  For my part, I agree with the opinion of Bingham J.  The cage, like a ladder, is a structure which is capable of being occupied.  As a result of such occupation, occupier’s liability may arise.  However, when the cage with its goods was handed over to the Plaintiff, the 3^rd Defendant parted possession of the laden cage to the Plaintiff, and along with that occupation.  The Plaintiff became the occupier.  As at that moment, no liability could attach to the 3^rd Defendant.

72.  Even assuming that the 3^rd Defendant remained as occupier of the cage, a physical impossibility arises.  How could the Plaintiff fit himself into the dicta of Bingham J above?  Occupier’s liability is attached to injury occurring inside or on the structure occupied by the occupier.  How could the Plaintiff “come on” the cage or had himself injured inside the cage?  The reality of the situation was that the cage was just a chattel in the hands of the Plaintiff.  No question of occupier’s liability could arise from the use of a chattel in the hands of the Plaintiff.

73.  As for the Plaintiff’s claim founded on the 3^rd Defendant’s occupation of the workplace, ie the relevant part of the pavement, I repeat my finding in paragraphs 63-66 above.  The 2^nd Defendant, through the Plaintiff and his co-worker, was the occupier and had control of the workplace at the time of the accident.  The 3^rd Defendant’s staff had never set foot on the pavement until when they rushed to the Plaintiff’s rescue after the accident occurred. The 3^rd Defendant had no occupation or control of the workplace.  It was not the occupier of the workplace.  No duty under the Occupiers Liability Ordinance could arise as against the 3^rd Defendant.

74.  Lastly, as Mr Leung submits, as a matter of law, there is a clear distinction between “occupancy duty” and “activity duty” of an occupier: Clerk & Lindsell[22]. Section 2(1) of the Occupiers Liability Ordinance provides:

“ The rules enacted by section 3 and 4 shall have effect, in place of the rules of the common law, to regulate the duty which an occupier of premises owes to his visitors in respect of dangers due to the state of the premises or to things done or omitted to be done on them.”

(My emphasis underlined)

It is clear that occupier’s liability relates to dangers due to the state of the premises and not activities carried out on the premises.  In construing a similar provision in the Occupiers’ Liability Act 1957, the English Court of Appeal said in Fairchild v Glenhaven Funeral Servies Ltd[23] that the phrase “state of the premises” limits the effect of the Act to occupancy duties.

75.  There is no shortage of authorities in support of this construction of the section.  In Tomlinson v Congleton Borough Council, a visitor dived into a shallow nature pool with rocks underneath and suffered serious injury.  Lord Hoffmann made the following observation[24]:

“… Likewise, a person who goes mountaineering incurs the risk that he might stumble or misjudge where to put his weight. In neither case can the risk be attributed to the state of the premises. Otherwise any premises can be said to be dangerous to someone who chooses to use them for some dangerous activity.”

I think that is an authoritative statement of the limitation of the section and the rationale for the limitation.

76.  In Yates v National Trust[25], which I discussed above, Nicol J held that although National Trust was an occupier of the ground, the duty arising therefrom is not relevant to the accident, which was caused by the plaintiff’s activity thereat.

77.  In Luen Hing Fat, the Court of Final Appeal held that leading counsel for the worker was right not to rely on occupiers’ liability as the accident was not due to the state of the premises.

78.  On the fact, the accident was caused by the Plaintiff’s activity in the workplace and not by the state of the premises, let alone he has failed to prove that the 3^rd Defendant was the occupier. 

79.  In conclusion, the Plaintiff has failed in every element which he has to prove to support his claim for breach of duty under the Occupiers Liability Ordinance.  He has failed to prove that the 3^rd Defendant was the occupier of the workplace, that the accident was caused by the state of the workplace, and that the 3^rd Defendant owed him the common duty of care. 

CONCLUSION

80.  For all of the above reasons, the Plaintiff has failed to prove his claim against the 3^rd Defendant.  There is no need to consider the question of contributory negligence.  Accordingly, the Plaintiff’s action is dismissed with costs to the 3^rd Defendant.  I also order that the Plaintiff’s own costs shall be taxed in accordance with Legal Aid Regulations.