POON CHUNG FAI v. LEUNG KA SHING AND ANOTHER

HCPI 1050/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES NO. 1050 OF 1999

____________

_______________

J U D G M E N T

_______________

1. In this action, the Plaintiff claims damages for personal injuries sustained when the motorcycle he was riding collided with the container lorry driven by the 1st Defendant, an employee of the 2nd Defendant. The 2nd Defendant was a company incorporated in Hong Kong. Liability and quantum were disputed.

Facts

2. At about 9:50 p.m. on 26 February 1998, the Plaintiff drove his motorcycle on the fast lane of Kwong Fok Road heading toward Shatin. Kwong Fok Road is a two-way road; each carriageway has two lanes. The 1st Defendant was driving in the opposite direction on that road.

3. The Plaintiff said that when his motorcycle reached the junction of Kwong Fok Road and Tung Cheong Street, the container lorry that the 1st Defendant was driving suddenly started turning right intending to cross Kwong Fok Road to turn into Tung Cheong Road. The lorry came into the pathway of the motorcycle and the right bumper of the lorry collided with the right side of the motorcycle. The Plaintiff lost his balance when he steered to the left to avoid the container lorry, his motorcycle fell to the ground, and eventually stopped somewhere on the pavement adjoining the Shatin-bound carriageway. The Plaintiff contended that the driver of the lorry failed to give any signal of his intention to turn right and had not turned on the indicator.

4. The 1st Defendant said that his lorry was stationary at the time of the collision. He said he pulled the front of the vehicle right, into the road and stopped preparing to cross the junction. It was some seconds later that the collision occurred when the Plaintiff drove into him. The 1st Defendant claimed that he had put on the right indicator to signal his intention to turn right, although he agreed he had not told police that at the time of the accident investigation.

Plaintiff's Injuries

5. The Plaintiff was admitted to the Prince of Wales Hospital for treatment of his injuries. He had a comminuted closed segmental fracture of the right tibia, skin contusions and marked swelling of the right leg with some numbness. Closed reduction with intramedullary nailing was performed on 2 March 1998 under general anaesthesia.

6. During the post-operative period the condition of right drop foot was noted and physiotherapy, electrical simulation and, splintage were used to counter it. The Plaintiff developed cellulitis over the contused skin areas which responded to antibiotic treatment at that time.

7. The Plaintiff was discharged from hospital on 27 March 1998 on crutches which allowed partial weight bearing on the affected leg. He was seen in the out-patient clinic in April 1998 and the skin wounds were noted to be healing and the fracture fixation was maintained. The doctor opined that a significant period for the fracture healing and rehabilitation was expected.

8. Bone union proved slow and the drop foot condition did not improve. The Plaintiff was admitted to the Prince of Wales Hospital on 24 to 26 July 1998 for removal of the locking screws under local anaesthesia. There was increased callus formation after the screw removal and an electromyography on 4 November 1998 showed changes compatible with right common peroneal nerve injury.

9. On 15 July 1999, Dr Lau Wai Kuen, an orthopaedic specialist, examined the Plaintiff. He confirmed that the Plaintiff walked with a limp and could not squat fully because of residual stiffness in the right ankle and the sub-talar joints. There was residual weakness of the right big toe extension caused by the peroneal nerve palsy. Doctor Lau said he expected the disabilities of the right leg to be permanent and recommended the removal of the intramedullary nail from the right leg two years after the accident. He considered that with the stiff right ankle, pain in the right shin and the weakness of the right leg generally, the Plaintiff would have difficulty in working in his previous employment as a painter and lighter jobs would be better for him. He noted that it was only because the Plaintiff had a considerate boss, who allowed him to avoid climbing up or squatting down at work, that he was able to continue working as a painter and he suggested other jobs, for instance, waiter, shop assistant, or office assistant, which had the advantage of having the work carried out on one level. He assessed the Plaintiff to have suffered 9% of permanent disability and a 10% loss of earning capacity.

10. The Plaintiff was examined by an orthopaedic specialist for the defence, Dr Alfred Chiang Si Chung, on 20 December 1999. The condition he described was similar to that reported by Dr Lau. He noted scarring on the leg, a 7 cm scar on the anterior aspect of the right knee; a 9 cm x 5 cm scar at the anterior aspect of the mid right leg; 2 small scars along the medial side of the right leg; 2 small scars at the superior aspect of the right leg below the knee and a 7 cm x 5 cm scar at the anterior aspect of the right leg. At the time of his examination, there was no discharge from the scars, the scars were stable and the skin around the scars pigmented. He noted decreased dorsiflexion of the right ankle and foot. He considered that the Plaintiff showed residual symptoms in the fracture site of the right leg and the right ankle. He agreed with Dr Lau that in a younger patient, such as the Plaintiff, it is preferable that the intra-medullary nail be removed and agreed that the likely costs for the removal operation would be $18,000.00, if done privately. He confirmed the permanent impairment of the whole person was about 8%.

11. Dr Chiang agreed that the Plaintiff might not be able to return to his former job which required heavy manual activity in climbing scaffolding, but considered that he could work in some painter's jobs where climbing is not required. He thought the Plaintiff should be able to do odd jobs on a construction site, or work as a casual painter doing interior decoration.

Present condition

12. The Plaintiff said he was no longer able to play football or swim. He was frightened to ride a motorcycle, or drive, and felt frightened when travelling as a passenger in a car. He felt pain in his right leg after walking or standing for about 45 minutes and walked with a limp when his right leg was painful. He was embarrassed by the heavy scars on his right leg, which prevented him from wearing shorts.

Liability

13. The Plaintiff said that shortly before the collision he was stopped at the traffic lights near the intersection with Wan Tou Street. When the lights changed he proceeded past the junction with Tung Cheong Street. He was 5 car lengths away, according to him, when he first saw 1st Defendant's vehicle in the outer lane of the westbound lane carriageway. The Plaintiff was travelling at about 40 km an hour in the fast lane. When about 2 car spaces away he noticed the lorry moving into the intersection across his path. He tried to avoid it by steering to the left but failed and his right foot and the right side of his bike collided with the right front bumper of the lorry. He noticed that the right indicator of the lorry had never been turned on.

14. The Plaintiff had 9 years of driving experience at the date of the accident. The bike he was riding was not a racing bike and had a capacity of a 400 cc. The bike was about 7 years old. He was adamant that he was not travelling fast and had not accelerated too fast when leaving the traffic lights.

15. The 1st Defendant said that he had been driving a container lorry for 5 years and had had driving experience of some 20 years. He said that he slowed down and turned on his indicator prior to the turn. He paid attention to the traffic, but there were no vehicles ahead of him. As there was a broken white line ahead of him he had no need to stop before turning and he eased out into the intersection at about 5 km an hour. He began the turning manoeuvre, his practice being to look in the right mirror and to look behind him. He saw the motorcycle when it was about 15 metres away from him. According to him it was travelling at a high speed, so he decided to stop and let it pass. While he was stopped the motorcycle banged into the right front bumper of his truck. According to him, the opposite carriageway to his left was clear of traffic to a distance beyond the traffic lights governing the intersection. Although he said he saw none, he conceded it was possible there were vehicles to his left. He said the reason he was unsure was that the road was so long it was impossible to establish the presence of vehicles beyond the traffic lights.

16. Having considered the evidence and the diagrams and photos of the intersection, I was satisfied that it was likely that the 1st Defendant had pulled right into the intersection without giving adequate indication of his intention to do so, or without keeping a proper look out. It was the 1st Defendant's duty to ensure the carriageway was clear of traffic before he turned across it. Given the fairly short distances involved, it is difficult to see why the 1st Defendant, who had a higher vantage point from the cab of his truck, could not have seen the motorcycle, both at the traffic lights and once it had driven away from them. The 1st Defendant suggested that his view of the motorcycle had been blocked by a safety island but I do not accept that was a realistic contention, given the height of his cab.

17. I accepted the Plaintiff's evidence that the 1st Defendant had not turned on his indicator before beginning the turn. Overall I was satisfied that the responsibility for this accident rested solely with the 1st Defendant. He had the primary duty of ensuring the carriageway was clear before crossing and a duty to indicate his proposed movement across the intersection. His vehicle gave him the advantage of a good view of the traffic, particularly the traffic situation to his left as he made the turn. I have considered the question of contributory negligence on the part of the Plaintiff but I am not satisfied that such had been established. I find the 1st and 2nd Defendants liable for the accident.

Pre-accident employment

18. The Plaintiff was 29 years old at the time of trial. He was married, living with his wife and had no children. He had worked as a painter since 1990 and at the time of the accident had been employed by Yue Cheung Painter Company, since 1996. On average he worked about 26 days per month and his daily salary, at trade union rates, was $760.00 p.d. at the time of the accident and had been since November 1997. He was on sick leave for a period of around thirteen months. He returned to work for the Yue Cheung Painter Company at the same daily rate, but was limited in the tasks he could perform because of residual problems with his leg. He had to stop work for at least one day, after working for 3 or 4 days. He was unable to take part in painting projects which involved climbing stairs, or scaffolding, or which required squatting. The number of days a month on which he worked dropped markedly.

19. In October and November 1999 he worked in a garage owned by a friend. His work was repairing vehicles and selling second-hand cars. The Plaintiff had difficulties coping with the repair work because he could not squat fully. Further, he was paid only $4,000.00 a month as his starting wage, so he left that job and returned to work for his former employer. From December 1999 to the time of the trial, he was working not more than 16 days a month.

PSLA

20. The Plaintiff's counsel contended that the Plaintiff's injuries were serious enough to be placed at the lower end of the serious injury category, as set out in Lee Ting Lam v. Leung Kan Ming [1980] HKLR 657. Counsel referred the court to the case of Chan Chi Shing v. Chan Kwok Engineering CACV No. 238 of 1999 in which, counsel submitted, the Court of Appeal increased the sum for injuries at the lower end of the serious injury bracket, from $400,000.00, (as revised in Chan Pui Kee v. Leung On [1996] 2 HKLR 401), to $460,000.00. However, counsel contended the proper award should be in the range of $500,000.00 to $550,000.00 for the following reasons:

1) the unsightly scars on the right lower leg;

2) the fact that post-cellulitis symptoms and skin sensitivity will take several more years to disappear; and

3) the need for a further operation to remove the intra-medullary nail and screws.

21. I think that Plaintiff's counsel is reading too much into the judgment of the Court of Appeal in Chan Chi Shing. Keith JA, delivering the judgment of the court, said it was not without hesitation that he concluded that it was open to the judge at first instance to treat the Plaintiff's injuries as coming within the category of serious injury. He clearly regarded the injuries as just falling within the serious injury category and said "once the injuries can be said to fall into that category, an award of $460,000.00 cannot really be attacked. It amounts to only 15% inflation on the figure at the lower end of the bracket, which is not unreasonable since 3 1/2 years have elapsed between the date when Chan Pui Kee was decided at first instance and the trial of the present action." In concluding the judgment, it was said that there was little doubt that the ultimate award was on the high side and that may have been because the Plaintiff was a beneficiary of a series of generous findings by the trial judge. It appears to have been a judgment peculiar to its own facts rather than one of general application.

22. The defence submitted that the Plaintiff had recovered well from his injury, that his condition had improved and, as he was back at work, the award should be in the range of $350,000.00.

23. I am satisfied that the accident has left the Plaintiff with a disability, which mars his working activities and his general enjoyment of life.

24. I agree that the Plaintiff's injuries should come within the lower end of the serious injury category. I was referred in particular to the cases of Lam Kwong Ting v. Ho Yeung Yuen [1992] HKC 381 and Lee Kwong Tong v. Lui Yi Luen & Another HCPI No. 1383 of 1996 which appears in the 1997 [HKLRD E34]. The injuries in those cases were comparable to the Plaintiff's, but Lee Kwong Tong was more serious and Lam Kwong Ting, which was decided in 1990, bears more resemblance to the present case.

25. On this head, I take all matters into account including the scarring which is unsightly, the residual pain and disability the Plaintiff has and award the sum of $400,000.00.

Pre-trial Loss of earnings

26. The Plaintiff was under a duty to take reasonable steps to mitigate his loss and although the defence suggested that the Plaintiff had deliberately earned less after he returned to work for his former employer, this was not substantiated by the defence which bore the onus of proof. The Plaintiff returned to work for his former employer about 2 months after the certified sick leave period had ended and, except for the 2 months when he worked for his friend at Autobike Services Company, he earned approximately 40% of his pre-accident earnings, averaging about 10.5 days instead of the original 26 days a month that he had been working.

27. The defence submitted that the Plaintiff should have become an interior decoration proprietor, or a labour sub-contractor. Although the Plaintiff is a skilled worker, I do not accept that he was in a position to work as a proprietor, or a labour sub-contractor in the decoration business. The Plaintiff said that he had none of the connections which were necessary for those businesses, nor did he have any capital with which to start a business.

28. There was disagreement about the number of days that work was available to the Plaintiff. While the defence appeared to accept that prior to the accident the Plaintiff was able to work 26 days a month on average, it was not agreed that this would have continued after the economic recession started in 1997. The defence asserted that the recession meant it was not possible, or likely, that the business of the Plaintiff's proprietor would not have suffered as many construction firms did and continued to suffer. It was the Plaintiff's case, supported by the evidence of his witness, Leung Tat Chuen, that there was still sufficient work to enable anyone who was interested in doing so, to work 26 days p.m. Mr Leung had worked with the Plaintiff prior to the accident; he told the Court his earnings had not been affected by the recession and the only time he stopped work was when he wished to take holidays.

29. I was satisfied that the Plaintiff's employer was able to offer him work, if he wanted it and was able to do it, on the basis of the 26 days a month that he had been working prior to the accident and it is on this number of days I assess the pre-trial loss of earnings.

Future Loss of Earnings

30. As for the multiplier to be adopted, there was some divergence between the Plaintiff and the Defendants. The Plaintiff said that 15 years was the appropriate multiplier given the Appellant's age and the likelihood of his continuing to work after he was aged 60. The Defendants considered the appropriate multiplier should be 12. 15 was the multiplier adopted in Lam Kwong Ting where the Plaintiff was 23 years old. In that case a number of non-fatal cases were considered, where the ages and the occupations were similar to the present case.

31. The basis for the lower multiplier the Defendants considered appropriate was the alleged unlikelihood of the Plaintiff continuing to work as a painter after the age of 60. I do not consider that was established. Given the Plaintiff's skill and given the need for painters both on new construction work and for renovation work, it is likely that the Plaintiff would continue to work after the age of 60, although he might choose to work fewer days per month. A painter is in a different position from an ordinary construction site worker because he relies less on physical strength for the task. Further, although a painter usually carried, according to the Plaintiff, a 4 to 5 litre tin of paint and, possibly, minor tools, he was not obliged to carry heavy loads, or, in the ordinary course of events, to put up his own scaffolding. In all the circumstances, I consider that a multiplier of 15 is the appropriate one to adopt in this case.

Future Loss of Earnings

32. The Plaintiff advanced this claim on the difference between the 26 days a month he worked before the accident and the 10.5 days a month worked on average between his return to work post-accident and the date of trial.

33. The Defendant contended that on the basis of the Plaintiff's own evidence 22 days a month was the more likely number of days that the Plaintiff would work. That was because the Plaintiff said he would take a rest day after every 3-4 days work, because of injury-related tiredness.

34. As Dr Lau opined that he expected the right leg disability to be permanent, it is likely that the present pattern of a rest day after every few days work would continue.

35. I consider that the post-trial earnings should be assessed on the basis of 22 days per month. The loss per month would be $760.00 x 4 = $3,040.00. Future loss would be $3,040.00 x 12 x 15 = $547,200.00.

Special Damages

36. Special damages were agreed during the course of the trial at a total sum of $53,200.70. These comprised medical fees and travelling expenses incurred by the Plaintiff, including two visits to a bone-setter $10,760.20; damaged clothing $1,800.00; new clothes and shoes of a larger size necessitated by the swelling of the Plaintiff's ankle $2,500.00; nourishing food, agreed at $7,000.00; the total loss of a motorcycle, agreed at $30,000.00 and the loss of income of the Plaintiff's wife agreed at $1,140.50.

Loss of Earning Capacity

37. The Plaintiff under this head claimed $200,000.00, being approximately 2 years wages, on the ground that he suffered a real material risk in the labour market if he lost his present job where his employer was so understanding of his difficulties. The defence argued that no award should be made under this head of loss. The Plaintiff relied on the case of Chan Chi Shing (supra). There, considering a similar claim, the Court of Appeal referred to the case of Chan Wai Tong v. Lee Ping Sum which set out what an award under this head of loss was actually for. It was to cover the risk that at some future time during the claimant's working life he would lose his employment and then suffer financial loss because of his disadvantage in the labour market and the court had to evaluate the present value of that future risk. Evidence was therefore required to prove the extent of any risk that the claimant would at some future time during his working life lose his employment. The degree of risk could vary indefinitely depending on the claimant's age and the type of employment. Evidence was also required to show how far the claimant's earning capacity would be adversely affected by his disability.

38. In Moeliker v. A. Reyrolle & Co. Limited [1997] 1 WLR 132 140 it was said that the consideration for this head of damages should be made in two stages, first, the court should ask if there was a substantial or real risk that a plaintiff would lose his present job at some time before the estimated end of his working life. If there was (but not otherwise), the court must assess and quantify the present value of the risk of the financial damage which the plaintiff will suffer if that risk materialises, having regard to the degree of the risk, the time when it may materialise, and the factors, both favourable and unfavourable, which in a particular case will, or may, affect the plaintiff's chances of getting a job at all, or an equally well-paid job.

39. In this case there is a real risk that the Plaintiff might lose his present job at some time before the estimated end of his working life. That is because although he is a skilled worker, he may not always be able to satisfy his employer that he is a useful member of a team doing the limited type of work that he is currently doing. There may well come a time when his professional skill is outweighed by the disadvantages that his employer sees in his having to be confined to work that is, literally, within the reach of his arm when he stands on a level surface and work which has to be performed on a level surface without his being asked to climb scaffolding or significant numbers of stairs. There will be an undoubted period of unemployment at the time when the intramedullary nail has to be removed surgically from the leg and the consequent period of convalescence.

40. At some point the Appellant may have to take up other employment, such as that suggested by Doctor Lee. That work is likely to be unskilled and consequently, poorly paid. For these reasons, I think it is appropriate that an award be made under this head, although I do not consider that such award should be as high as that claimed by the Plaintiff. An award equivalent to one year's salary would be appropriate and I award the sum of $237,120.00 under this head.

Taxation

41. There was agreement that in quantifying the claim the Plaintiff's tax liability was to be taken into account as a matter of law, on the principle of British Transport Commission v. Gourley [1956] AC 185. The Plaintiff has to give the Defendant credit as a result of the saving of tax which he would otherwise have to pay on his earnings if he had not met the accident. The reason for this is that damages awarded to the Plaintiff as loss of earnings are not taxable.

42. For this purpose, both counsel referred to the Guide on how to Complete the Tax Return for Individuals issued by the Inland Revenue Department. Annex C of that guide shows that in 1998 and 1999, the basic allowance for an individual was $108,000.00. If the Plaintiff had not been injured, it is assumed that he would have worked 26 days a month at a daily rate of $760.00. In that case his notional annual income would have been $760.00 x 26 days x 12 months = $237,120.00.

43. The Plaintiff would have to pay tax on the net chargeable income, being the assessable income of $237,120.00, less the basic allowance of $108,000.00. According to the graduated rate in the table to Annex C, the net chargeable income would have been $129,120.00. Tax would be payable on the first $35,000.00 of that sum at 2%, $700.00; on the next $35,000.00 at 7%, $2,450.00; on the next $35,000.00 at 12%, $4,200.00 and on the remainder at 17%, $4,100.40 making a total of $11,450.40. The tax credit for the two year pre-trial period would be $22,900.80.

44. For the post-trial period the Defendants contend that tax liability should be assessed on the same basis and that the tax credit would be $11,450.40, times the multiplier decided by the court. The Plaintiff submits that tax assessment for the post-trial period may be complicated because, for example, the Plaintiff and his wife may have children, or the wife may stop work, or cut down the amount of her work outside the home. If any of those events occurred, the Plaintiff would no longer have to pay tax in accordance with the current scheme of allowance. He would be entitled to set off his annual income with the Married Person Allowance, or the First Child Allowance. On that basis, the Plaintiff made an offer, at the conclusion of the trial, for an annual tax credit for the post-trial period of $2,000.00 p.a. If a multiplier of 15 was adopted, the total amount of tax for the post-trial period would be $30,000.00.

45. Given the uncertainty and the difficulty of attempting to predict the Plaintiff's future tax position I consider it more appropriate to give an annual tax credit for the post-trial period. I consider that a credit of $4,000.00 a year would be sufficient and I give credit for that sum multiplied by 15 making a total of $60,000.00, which sum will be deducted from the amount ordered for post-trial loss of earnings.

Award

46. Interest is awarded at 2% p.a. on general damages from date of writ (18.9.99) to date of judgment and at 5% on special damages from date of accident (26.2.98) to date of judgment.

47. There will be an order nisi for costs of the action be to the Plaintiff, to be taxed if not agreed.

48. Plaintiff's own costs to be taxed in accordance with Legal Aid Regulations.

49. Liberty to apply