CHOY WAI CHUNG v. CHUN WO CONSTRUCTION AND ENGINEERING CO. LTD.

CACV14/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 14 OF 2000

(ON APPEAL FROM DCEC 332 OF 1998)

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J U D G M E N T

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Hon Rogers VP:

1. This is an appeal from a judgment of H H Judge Muttrie given on 14 December 1999. The matter arose in relation to a claim under the Employees Compensation Ordinance, Cap. 282.

The facts

2. The applicant Mr Choy Wai Chung was an engineer. In June 1996 he was engaged in work on a construction site on the Peak. On 28 June 1996, he suffered an injury to his ankle. As a result of that injury, Mr Choy had to have hospital treatment. Mr Choy has been on sick leave ever since. The sick leave certificates up to 30 November 1999 were produced in the court below. Further sick leave certificates covering the period from 30 November 1999 to 27 November this year were produced as exhibits to an affirmation by Mr Choy which was admitted on this appeal. It may be noted that unfortunately Mr Choy has, in September this year, suffered a gastric ulcer. It would seem that the medication which Mr Choy has been given to relieve the pain and symptoms in relation to his ankle has caused his stomach disorder. That, however, is not a matter which has become relevant on this appeal.

3. Mr Choy applied for compensation under the Employees Compensation Ordinance on 12 May 1998. He was assessed by the Board as having a 2% permanent loss of earning capacity on 21 July 1998. That was taken on review and on 29 October 1998, the Board reassessed the permanent loss of earning capacity at 10%. The matter then went to appeal and on appeal the judge assessed the permanent loss of earning capacity at 20%. Although this appeal originally arose as a result of an appeal by the employers as to that figure, that appeal has been abandoned.

The issue on this appeal

4. On this appeal Mr Choy claims that in addition to the award under section 9 of the Employees Compensation Ordinance, he should be awarded compensation under section 10 for the full three-year period which is allowable under section 10(5).

5. Compensation under section 10 is in respect of temporary incapacity. The relevant part of section 10(1) reads:

"Where temporary incapacity whether total or partial results from the injury, the compensation shall be the periodical payments hereinafter mentioned, or a lump sum calculated accordingly, having regard to the probable duration, and probable changes in the degree, of the incapacity."

For the purpose of identifying the mischief which gave rise to the introduction of compensation in the case of temporary incapacity under section 10, our attention has been drawn to statements made when the Workmen's Compensation (Amendment) Bill was introduced in 1969. On the Second Reading, Mr Hetherington, who at the time was the Commissioner of Labour said, amongst other things:

"It has been found that, under present legislation, a workman, whose injuries have involved fairly lengthy but successful treatment and whose permanent incapacity is assessed at a low rate, may have received, by way of periodical payments during treatment, an amount which has absorbed most or all of the compensation ultimately assessed. So, the workman leaves hospital with a significant disability but little, if any, cash. Clause 10(b) inserts a new subsection whereby compensation by way of periodical payments for temporary incapacity shall not be deductible from any lump sum payable for permanent incapacity or, where it occurs, subsequent death."

6. Even though the wording of the sub-section that was introduced at the time was different from the present wording, I consider that the effect of the sections is similar and hence reference may still be made to the mischief sought to be cured.

7. It would seem, therefore, that at least one of the mischiefs, which was sought to be cured lay in the fact that the method of calculating compensation under the ordinance did not cater for the fact that the employee might have a significant period of greater temporary incapacity followed by permanent incapacity of a lesser level. The equivalent of what is now section 10(4) was therefore introduced to provide that no compensation for temporary incapacity should be deducted from compensation payable for permanent incapacity.

8. It should be noted that sub-section (2) of section 10 reads:

"For the purposes of this section a period of absence from duty certified to be necessary by a medical practitioner, a registered dentist, an Ordinary Assessment Board or a Special Assessment Board shall be deemed to be a period of total temporary incapacity irrespective of the outcome of the injury."

9. In this case, as has been noted already, the medical certificates cover the full period from the date of injury until after the hearing of this appeal. Moreover, the certificate of assessment which was issued by the Employees Compensation (Ordinary Assessment) Board on 21 July certified the period of absence from duty necessary as a result of the injury as being 30 June 1996 to 10 July 1998. On the review, the Board's certificate dated 29 October 1998 certified the period up to 16 October 1998.

10. On the appeal, in the court below, the judge noted that the Board first assessed Mr Choy as having a 2% permanent loss of earning capacity on 21 July. The judge went on to say:

"In fact the Applicant does not seem to have had any active treatment after November 1997. According to Dr Au, by April 1998 the medical report of Dr Chan showed that the Applicant was capable of doing indoor work. Quite why the Applicant is still obtaining sick leave certificates, if he is capable of indoor work, and has been assessed as having a permanent loss of earning capacity is not clear. But I cannot see any justification for extending the period of temporary incapacity beyond the time when the provisions of Section 9 came into play, i.e. 21st July 1998."

It would seem that, perhaps, sight was lost of the mandatory effect of section 10(2). Not only were there medical certificates but the Ordinary Assessment Board had certified Mr Choy as requiring absence from duty up until 16 October 1998, the date of its review.

11. No doubt, in civil claims for personal injuries, the court is entitled to look to see what the injuries of the plaintiff are and to see whether indeed the plaintiff was entitled not to be compensated on the basis he was not able to do any work. Compensation under the Employees Compensation Ordinance, however, is based in a number of respects on a different premise and the method of calculation is laid down in the Ordinance.

12. However, this is not a technical matter alone it now transpires. Dr Chan who wrote the very brief report in April 1998, has himself issued a number of medical certificates, certifying Mr Choy as being unfit for work, in particular: April, August, October, December 1998, January, February, May, August and December 1999, January and March 2000. Hence the deduction made by Dr Au as to Dr Chan's assessment of Mr Choy's fitness work was almost certainly inaccurate.

Should the period be extended beyond 21 July 1998

13. The basis of Mr Choy's claim for an extension of period is under section 10(5) that reads:

"An employee who has received periodical payments under this section for a period of 24 months from the date of the commencement of the temporary incapacity or for such further period being not more than 12 months as the Court may allow in any particular case shall no longer be entitled to periodical payments under this section but shall be deemed to have suffered permanent incapacity and the provisions of section 7 or 9, as the case may be, shall apply to the employee."

The judge below construed the discretion in the court to allow an extension of the period of temporary incapacity as being "intended to cover the situation where it is not known, at the end of two years, whether or not the loss of earning capacity will be permanent. If there is a chance that it will not be, the Court may extend the period. Once it is known that the loss of earning capacity is permanent it is difficult to see why the period should be extended."

14. In my view, in so construing section 10(5), the judge below limited the discretion of the court in a manner not intended by the legislature. As has already been indicated, the mischief sought to be cured by the introduction of the provisions of section 10 was to alleviate the problem which would be caused when an employee suffered a period of temporary incapacity followed by a period of permanent partial incapacity which would result in his not receiving adequate compensation for the period when he was temporarily incapacitated.

15. In those circumstances it appears to me that the discretion in the court below was exercised on a wrong footing. Taking into account the medical certificates which have been produced, it seems to me to be fair in all the circumstances that Mr Choy should receive compensation for temporary incapacity for the full three-year period possible. Thereafter, of course, the section mandates that the compensation which will be payable will be the compensation for permanent partial incapacity as certified by the Board.

16. In those circumstances it is unnecessary to deal with the further argument that was advanced on behalf of Mr Choy which were founded on statements made by Godfrey JA in Chan Siu Ling v. Tonyear Investment Ltd. [1999] 2 HKC 348. In that case, in referring to the scheme of Ordinance, the judge referred to the cut-off period after which the employee's injury would be regarded as being permanent and he said that the sooner that that was established, the better. He went on to say that in the nature of some injuries it may take time to establish whether it is permanent or not, that might be because of the nature of the injury or it might be because of "inevitable bureaucratic delays".

17. In a situation such as this, where the assessment of the temporary benefit is one which the court is making after the full three-year period has expired, it seems to me that the question of the length of any proceedings might not be such a relevant factor. The length of the proceedings is likely to be relevant in the period whilst those proceedings are continuing: the employee would then be seeking temporary payments whilst the proceedings are continuing. The justification for such payments, thus, becomes clearer.

18. I would therefore allow the cross-appeal of the applicant with the result that the period of temporary total incapacity should be extended for the full 12-month period after the conclusion of 24 months from the commencement of incapacity.

Hon Stock JA:

19. I agree.

Hon Le Pichon JA:

20. I agree with the judgment of the Vice-President and would also allow the cross-appeal of the applicant.

Hon Rogers VP:

21. Accordingly, the cross-appeal will be allowed. There will be an order nisi that costs be in favour of the applicant.