HO YUK SIM v. CHAN WING FAT AND OTHERS

DCEC 778/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION NO. 778 OF 2010

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J U D G M E N T

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1.  It was a fatal accident at work. Kwan Wai Kwok (“the Deceased”) died in the course of electric wiring work on 4 August 2008. The applicant, the Deceased’s mother, now claims compensation pursuant to the Employees’ Compensation Ordinance, Cap 282 (“ECO”) against the 1^st respondent (“Fat”) and the 2^nd respondent (“Kinson”).

BACKGROUND

2.  Chan Hung Wah Samuel (“Wah”) used to be a proprietor of Agents Design Company Limited (“AD”).  Wah is the uncle of Fat.  In 2008, Wah withdrew from AD and joined Kinson as an equal shareholder and director with another person.

3.  In 2003, Fat obtained the qualification as a registered electrical worker (“REW”). Wah then suggested Fat should form his own business and become a registered electrical contractor.  In the same year, Fat started to operate his business in the name of the 1^st respondent; and the same also became a registered electrical contractor.

4.  In the days when he was with AD and later Kinson, Wah had engaged Fat, both before and after he started to operate his business in the name of the 1^st respondent, to work from time to time.

5.  The accident happened at Shop Nos GA 28-34, Ground Floor, Tsuen Fung Centre, Tsuen Wan, New Territories (“the Site”).  These were joint shop units under renovation at the material time.  There is no dispute that Kinson contracted the renovation work for the tenant of the shops, the electrical work being part of it.

6.  In the morning in question, the Deceased was standing on a wooden ladder carrying out electric wiring work.  In the course of that, he received an electric shock and fell.  He was sent to the hospital and certified dead later.  Autopsy confirmed that the Deceased died of electrocution.

7.  The above background is uncontroversial.

8.  There were questions as to whether or not the Deceased was at the time a qualified electrician; and whether he was engaged to work as an electrical or merely a casual worker.  It matters not as far as the liability to compensate under the ECO is concerned.  There is no dispute that he met his death in the course of his work and that arose out of his work there at the material time.

9.  The applicant claims that Fat and/or Kinson were the employer of the Deceased at the time.  As far as Fat should be liable as the employer, Kinson should in any event be liable as the principal contractor pursuant to section 24 of the ECO.

10.  Fat denies that he was the Deceased’s employer; and contends that he only introduced the Deceased to work for Kinson at the time.

11.  Kinson has filed no answer.  Seeing the need to protect its interest in the circumstances, the insurer of Kinson applied and was joined as the 3^rd respondent (“Concord”).

12.  In the shoes of Kinson, Concord contends that Kinson was the principal contractor of the renovation work from which Fat contracted the electrical work in question; and it was Fat who employed the Deceased to work there.

13.  Insofar as the quantum of compensation is concerned, Fat, through counsel, confirmed that he does not dispute the amount being claimed being the applicant’s best case.  Concord made no admission as to the quantum.

WHETHER THE DECEASED WAS THE EMPLOYEE OF FAT OR KINSON AT THE MATERIAL TIME

14.  Whether a person is an independent contractor or an employee is a matter of fact to be decided after examining all the features of the relationship between the parties against the background of the indicia developed in the case law with a view to forming an overall impression.  Both counsel referred to the leading authority of Poon Chau Nam v Yim Siu Cheung [2007] 1 HKLRD 951 (at 961) for the often-cited approach to the question.

15.  As far as the relationship between the parties at the material time is concerned, the dispute raised by Fat goes beyond the above question.

Fat’s answer and witness statements

16.  Fat first filed his answer to the application for compensation in October 2010.  He denied any subcontracting relationship with Kinson and any employment relationship with the Deceased.  He admitted that it was he who introduced the Deceased to work for Kinson.  But like the Deceased, he was also employed by Kinson to work at the Site.

17.  By his first statement filed in March 2011, Fat essentially stated that he had visited the Site in July 2008 at the request of Wah of Kinson to quote for the electrical work at the Site.  After viewing the Site and considering the electrical work involved, he was unable to and did not give a quotation.

18.  Fat continued to say that he then helped install temporary power supply for the Site for Kinson free of charge.  He also referred the Deceased to work for Kinson at the Site.  Except for that, he did not work at the Site, whether as a subcontractor or an employee of Kinson.

19.  The discrepancy between his answer in 2010 and witness statement in 2011 is apparent.  To reconcile, Fat amended his answer in April 2011.  Except for his involvement mentioned above, Fat now denied in his amended answer that he was employed to work at the Site at all.

Previous out of court declarations and statement

20.  Since the accident, Fat had given numerous declarations to the investigator officer, Lee Chi Ming (“the Officer”) of the Labour Department (“LD”), and the police.  The denial of involvement in the work at the Site even as an employee still deviated from those declarations and statement.  Fat found it necessary to explain that in his witness statement.

21.  In view of Fat’s allegations in this respect in his statement, the solicitors for the applicant and Concord separately sought clarification from the LD, which the Officer provided through the LD in June and July 2011 respectively.

22.  The 1^st declaration was made as a result of the interview of Fat conducted by the Officer on the date of the accident, 4 August 2005.  It recorded that he was employed by Kinson to carry out electrical work at the Site at the time.  He was not its subcontractor.  He introduced the Deceased to work at the Site; but had instructed the Deceased not to carry out any wiring work at Site in his absence.  In the morning in question, he had attended the Site to see what was needed for work there.  The accident happened to the Deceased after he had left the Site.

23.  This declaration was however not signed.  Fat now stated that some of the answers recorded did not in fact come from him; and therefore he refused to sign the declaration.  Upon that, the Officer neither amended the declaration nor asked him to sign it.  Instead the Officer indicated that Fat could sign it when they met again.

24.  Contrary to that, the Officer explained that the 1^st declaration was indeed given to Fat to read and to sign.  Fat indicated no disagreement to the content or requested any amendment.  However it was upon the arrival of Fat’s legal representatives did they convey to the Officer the instruction from Fat that he refused to sign the declaration.  The Officer simply did not insist otherwise.

25.  When it came to his evidence in court, Fat explained that he did not get to read the 1^st declaration.  He was confused and therefore did not sign it.  At one point, he suggested that it was the legal advice against signing the document that he received from his legal representatives.  At another point, he seemed to accept the Officer’s explanation of what happened then.

26.  Fat was far from being consistent in his explanation of why he did not sign the 1^st declaration; and more importantly, whether the declaration was an accurate record of the interview.

27.  It should be noted that Fat apparently obtained legal assistance after the 1^st declaration.  He gave a statement to the police a week later; and that statement recorded that he did so in the presence of the representative of his solicitors and his counsel.  Notwithstanding that, that police statement was actually similar in content to the 1^st declaration to the LD.  Fat had things to say about his then legal representatives.  I will come to that later.

28.  Back to his witness statement, Fat continued to explain how he came to sign another declaration at the end of the interview on 19 August 2008.  According to him, that was a declaration prepared by the Officer for him to sign.  It was only afterwards did Fat come to realise that the declaration consisted of substantially leading questions.  He was both intellectually incapable and misled by the Officer who allegedly tried hard to make him admit that he was the employer of the Deceased at the time of the accident.

29.  The declaration that Fat referred to was a one-page handwritten record of questions and answers.  What Fat did not disclose in his statement was that before this one-page declaration was taken, it was Fat who took a typed declaration that was prepared in advance to the Officer at the interview on 19 August 2008.  As shown in the typed declaration, amendments were made, initialled and eventually signed by Fat.  That was chronologically the 2^nd declaration.

30.  According to the Officer, and Fat confirmed in court, that the one-page declaration was in fact a record of the follow-up questions and Fat’s answers consequential upon the 2^nd declaration provided by Fat to the Officer during that interview.  The one-page declaration referred to by Fat was therefore the 3^rd declaration that came to exist on the same day.

31.  Further, as follow-up questions, what the Officer asked Fat about, and now recorded in the 3^rd declaration, were hardly leading questions with a view to making Fat to admit that he was the employer of the Deceased at the time of the accident.  None of those follow-up questions reflects the alleged attempt that the Officer was now accused of.

32.  There was then the 4^th declaration on 8 October 2008.  This declaration contained numerous paragraphs on the details of Fat’s involvement in the electrical work at the Site at all material times.  It was he who decided the work procedures and methods as well as timing.  Besides wiring work, he had inspected the power supply and insulation of cables to ensure that they were safe from time to time. He knew where to get the keys to the power room, if necessary.  The Deceased was not supposed to carry out electrical work as the same would be done by him, presumably being a REW.  As the Deceased was supposed to carry out casual work, no training or supervision in electrical work was provided to the Deceased on the Site.

33.  In his statement, Fat now explained that the 4^th declaration was likewise prepared by the Officer for him to sign.  He was intellectually incapable of approving the same word by word.  He disputed the truth of those paragraphs mentioned above.  In court, Fat testified to the effect that substantial part of the declaration was untrue; as he was not involved in any electrical work at all since what he did free of charge at the Site in July 2008.

34.  However, like the 2^nd declaration, the 4^th declaration was again typed.  According to the Officer, the 4^th declaration was also prepared in advance and provided by Fat to him when Fat attended the interview on that day.  Fat managed to do that because the Officer in fact first sent his questions to Fat by post on 30 September 2008.  At Fat’s request, the Officer also sent a copy of those questions to Fat’s solicitors by email.  That was how Fat came to attend the interview on 8 October 2008 with his answers to those questions prepared and typed out in advance.

35.  Importantly, common in both the 2^nd and the 4^th declarations were numerous corrections and amendments not only made but also initialled by Fat. They show that Fat was not only able but also cared to make even minor amendments of his declaration.  This contradicted his alleged inability to approve the contents of the declarations word by word.

36.  Had any part of the contents of these declarations been far from true as Fat now suggested, one would have expected the declarations to be withheld from the Officer in the first place or those disputed parts to be substantially crossed out when provided to the Officer at the end of the interviews.

37.  The 5^th declaration was dated 15 October 2008.  This declaration came in 2 versions: one typed and one written.  According to Fat in his statement, this was again a declaration prepared by the Officer in advance provided to Fat for signing.  Fat signed the typed version; but was somehow requested by the Officer to copy that by hand.  Fat complied; and hence the written version.  Fat added that he made some amendments in the course of copying.

38.  The Officer gave a different account.  According to him, during the interview on 8 October 2008, and after the 4^th declaration was provided by Fat and signed, when he handed to Fat some follow-up questions in writing.  Pursuant to that, Fat returned on 15 October 2008 together with, once again, a typed declaration containing his answers prepared in advance.  Fat chose to copy the declaration then for more space to accommodate the necessary amendments.

39.  Irrespective of the different accounts, Fat in both the typed and handwritten versions of the 5^th declaration admitted that it was he who supervised the Deceased’s progress at work; and the Deceased had to report to him about lateness for work and early leave from work.  But he now disputed all that.  If he were right, one wonders how he possibly failed to correct himself before he signed the typed version of the declaration or whilst caring to make all those amendments when copying it and eventually signing the written version.

40.  Up to that stage, Fat had been telling the police and the Officer details of his involvement in the electrical work at the Site.  As observed by Miss Lau, the extent of details could only be provided out of actual work experience at the Site.  Fat now sought to overturn his previous multiple declarations; and testified to the effect that he did not have any control over how the electrical work at the Site was carried out or the Deceased; but merely conveyed Wah’s instructions to the Deceased at all material times.

41.  Fat made his last declaration to the Officer on 8 December 2008.  On that occasion, Fat was formally cautioned on the charges that might be laid against him.  In the presence of his solicitor and counsel, he exercised his right to silence.

42.  In his submission, Mr Cheung, counsel for Fat, emphasized that his client was consistent in his denial of employment of the Deceased.  Be that as it may, Fat’s evidence is far from straightforward.  In respect of what was recorded and what happened at different stages, Fat always had something to explain.  The message every time effectively was to explain that the records should not be taken at their face value.

43.  His counsel was aware of the situation.  In his submission, Mr Cheung asked me to take into account his client’s mindset when assessing his evidence.  Specifically he submitted that Fat appreciated the adverse consequence that Kinson might face when it was found out that there had not been an REW handling the electrical work at the Site.  Meanwhile Fat could not admit the falsity of being the Deceased’s employer.  What Fat did in his previous declarations to the Labour Department was an attempt to protect his uncle by holding himself out as the person supervising the electrical work at the Site whilst maintaining that he was not the employer of the Deceased.

44.  The problem with the above is that the alleged mindset of Fat is not a matter that could be left to be raised during closing submission.  It also goes beyond matters that can be inferred from the known primary facts.  Had the operation of such thought on the mind of Fat been the cause of what he had said and done other than entirely as he had wished, one would have expected him to say so in his statement in these proceedings at the latest.  There was no evidence of that.

45.  That the contents of the previous out of court declarations and statement were the combination of Fat’s active and conscious attempt to protect his uncle and his passive subjection to the fabrication by the Officer at the same time defies reasonable belief.

46.  Fat’s declarations, fairly read, were self-serving in that he emphasized the steps that he had taken to ensure that the Deceased was not exposed to risk of electrocution.  One would not have expected fabrications by the safety officer to incriminate the declaration maker to be like those.

47.  Further, those declarations, unless agreed, could at most be referred to for the purpose of cross-examination during the trial before the magistrate.  The own statement of the Officer was indeed read out as agreed evidence (see transcript at p.68N-P).

48.  There was not the slightest trace of circumstantial evidence tending to show why the Officer would put words into Fat’s mouth as alleged.  In terms of their explanations of the circumstances surrounding the various declarations mentioned above, I have no difficulty in rejecting that provided by Fat.

The trial before the magistrate

49.  As a result of the accident, both Kinson and Fat were prosecuted as a result of the fatal accident.

50.  Kinson pleaded guilty except for 1 summonses (TWS 1312/2009) in respect of which it essentially disputed whether it could be liable for contracting for electrical work, whilst not being a registered electrical contractor, when the carrying out of such work was subcontracted to Fat.  The argument was rejected by the learned magistrate (see transcript at pp.109S-110I); and Kinson was accordingly convicted as charged.

51.  In the case of Fat, he was eventually faced with 3 summonses before the magistrate essentially for:

(1)  being a contractor having direct control over the construction work at the Site, failing to take measure to prevent workmen employed in carrying out the work from the danger of coming in contact with live electric cable, contrary to sections 47(1A); 68(1)(a) and 68(2)(a) of the Construction Sites (Safety) Regulations, Cap 59 (Case No TWS 1442/2009);

(2)  being a proprietor of the industrial undertaking at the Site, failing to provide and maintain a system of work that was safe to the persons employed there, contrary to sections 6A(1); (2)(a); (3) and 13 of the Factories and Industrial Undertakings Ordinance, Cap 59 (Case No TWS 1443/2009);

(3)  being a proprietor of the industrial undertaking at the Site, failing to ensure notices as to the treatment of persons receiving electric shock were displayed at the Site, contrary to sections 27; 31(1) and 31(2) of the Factories and Industrial Undertakings Regulations, Cap 59 (Case No TWS 1444/2009).

52.  No evidence was offered against Fat in respect of TWS 1443/2009.  After trial, Fat was convicted in TWS 1442/2009 and TWS 1444/2009 and was fined.

53.  Pursuant to section 62(2) of the Evidence Ordinance, Cap 8, in civil proceedings, a convicted person shall be taken to have committed the offence of which he has been convicted, unless the contrary is proved.  Without prejudice to the reception of any other admissible evidence for the purpose of identifying the facts on which the conviction was based, the contents of any document which is admissible as evidence of the conviction and the contents of the information on which the person was convicted shall be admissible in evidence for that purpose.

54.  Mr Cheung pointed out that the learned magistrate considered the dispute as to whether the Deceased was employed by Fat or Kinson at the material time to be immaterial for the purpose of the above charges (see transcript at p.110M-Q). As there was no finding that Fat was at the material time the employer of the Deceased, Mr Cheung doubted the relevance of the convictions against Fat.

55.  As stated in its answer, Concord sought to adduce the convictions as evidence of what the convictions tend to show, namely, Fat was a contractor who had direct control over the electrical work at the Site; and the Deceased was instructed to carry out electrical work there.  In view of the current stance of Fat in the same respect, their relevance in my view is unquestionable.

56.  Worth noting is that Wah was called as a prosecution witness during the trial.  His evidence, which was in line with his declarations to the LD, was that Kinson contracted the renovation work at the Site from the tenant; and subcontracted the part of electrical work to Fat.  Fat had control over how the electrical work was carried out including hiring of workers.  The Deceased was employed not by Kinson but by Fat.

57.  At the end of the prosecution evidence, counsel for Kinson and Fat made their respective no-case submission.  Finding a case to answer, Fat elected not to give evidence; and his case closed and was followed by counsel’s submissions.

58.  During the adjournment pending verdict, Fat changed his legal team; and applied to reopen the case as he retracted his election not to give evidence.  The application was argued and dismissed by the magistrate.

59.  Now from the Officer, Fat turned to blame his former legal team as well.  Fat stated that Wah arranged the lawyers to accompany him to the interview at the LD on 8 December 2008.  What Fat did not say was that they were in fact the same legal team who accompanied him to give his statement to the police 1 week after the accident as mentioned above.

60.  According to Wah in court, he did introduce the solicitor to Fat on the very first occasion after the accident.  But what happened between Fat and the solicitor afterwards was entirely a matter of Fat’s own instruction without Wah’s arrangement or involvement.  The record also shows that Kinson had all along been represented by a different legal team including the trial before the magistrate.

61.  By his statement filed for these proceedings, Fat complained that his former counsel and the solicitors’ representative induced and threatened him that he stood high chance of conviction if he elected to give evidence.  He was forced to concede unwillingly.  Regretting that, he proceeded to change legal representatives; and instructed them to apply to re-open the case.

62.  However, what his new counsel submitted in the application before the magistrate did not tally with Fat’s current complaint.  The magistrate specifically asked his counsel to confirm whether the application was taken out because Fat’s previous legal team admittedly gave Fat wrong advice or admittedly acted against Fat’s insistence on electing to give evidence.  His counsel then confirmed that he had no such instruction alleging misconduct on the part of the previous legal team (see transcript at pp.101U-102I).

63.  In dismissing the application, the magistrate explained that there was no concrete evidence in support of the application apart from vague reference to communication problem between Fat and his previous legal team (see transcript at 108C-G).

64.  The current complaint of Fat about the professional conduct of his former legal team is serious.  According to his statement, he decided not to pursue against them upon taking legal advice.  Both his former solicitors and counsel had no opportunity to be heard on such serious complaint, if they are at all aware of it.

65.  The unfairness is more apparent when one considers how the trial before the magistrate was actually conducted by his former legal team.  The fact was that the propriety of calling Wah as a prosecution witness had actually been addressed by counsel (see transcript at pp.6-8).  The magistrate was acutely aware of that and warned himself about that in his deliberation (see transcript at p.109O-Q).  Fat’s counsel also cross examined Wah in respect of the latter’s evidence including that the Deceased was employed by Fat (see transcript at pp.41S-51F).

66.  At the end of the day, there was no appeal on the ground that the magistrate’s refusal of Fat’s application to re-open the case was wrong so that his conviction became liable to be squashed.

Evidence of Kinson

67.  As Kinson did not enter appearance in these proceedings, Wah actually attended court under a writ of subpoena issued at the request of Concord.  So did the other proprietor of Kinson, Mak Wai Chung (“Mak”).

68.  Wah nevertheless gave evidence that was in line with Kinson’s position as explained in Wah’s previous declarations to the LD and statement to the police as well as his evidence in the trial before the magistrate.  Essentially, the electrical work at the Site at the material time was subcontracted to Fat, being a registered electrical contractor; and that the Deceased was employed by Fat.  When he made his declarations to the LD, Wah was uncertain about what the Deceased actually did at the Site but he believed the Deceased was employed by Fat.  During the trial before the magistrate, Wah explained that he had checked afterwards and found no record of payment of wages to the Deceased for work at the Site. Nor was the Deceased or Fat on the list of Kinson’s contribution towards MPF.

69.  Mak confirmed that Kinson had already subcontracted work to Fat even before Wah joined Kinson.  Both Mak and Wah were not registered electrical contractors.  It would seem that Kinson practically needed to engage such a registered contractor to take charge of the electrical work in the contracts that it obtained from clients. In his declaration to the LD in August 2008, Wah also managed to produce a copy of the certificate of registered electrical contractor of Fat in the name of the 1^st respondent.

70.  As mentioned, Fat alleged that after viewing the Site and considering the electrical work involved, he felt unable to give a quotation to Kinson.  This happened in July 2008.  Specifically, the reason was Kinson required the installation of 3 sets of 60AMP to enhance the power supply for the joint shop units.  The work also entailed the installation of long electric cable in an inconvenient and potentially costly manner.  Mr Cheung submitted that Fat had the consideration of profitability in mind.

71.  Mr Cheung pointed out that the plan to install the 60AMP had been mentioned in the declarations to the LD.  He was indeed right; but that does not assist his client’s case, if reference to that is studied closely.

72.  Kinson’s quotation for the renovation work was dated 16 July 2008.  In her 1^st declaration to the LD dated August 2008, the sister and authorised representative of the tenant of the joint shop units (“Yim”) confirmed that the quotation indeed set out all the items of work that needed to be carried out.  Apart from installing new outlets and switches, the electrical work included the installation of 7 sets of 30A fuse box (or “單相扉士箱”).

73.  However, in her 2^nd declaration dated December 2008, Yim added that prior to the accident, Wah had mentioned the need to change (from “單相”) to one set of 3-phase (or “三相”) fuse box.  The declaration was silent as to the timing of such conversation between Yim and Wah.

74.  In his 3^rd declaration to the LD (19 August 2008), Fat was specifically asked about the wires above the ceiling air-conditioning unit at the Site depicted in the attached photograph.  In his reply, Fat mentioned that Kinson intended to enhance the power supply by changing to 3-phase 60AMP.  But the same also cast no light on when such idea arose.

75.  In court, Wah accepted that the idea of the change of fuse box type had been mentioned.  But the timing of that was far from clear from the evidence.

76.  Had the idea to change the fuse box to 3-phase 60AMP been a decision prior to 16 July 2008, it would have formed part of Kinson’s quotation instead of the installation of 7 sets of 30A fuse boxes; and Yim probably would not have said what she did in her 1^st declaration.

77.  In court, Wah explained that after the accident, the 3-phase 60AMP was indeed installed but by the landlord in order to comply with the safety requirement. Yim or Kinson did not have to pay for the cost of such installation.  Hence Kinson also did not vary the quotation to Yim eventually.

78.  All these tend to support the inference that the idea of changing of fuse box arose after the quotation, though prior to the accident.  It was not contemplated by the tenant or Kinson at the time when Kinson gave its quotation that the 3-phase 60AMP had to be installed.  On this basis, I do not see how Fat had the concern about profitability as if he were required to carry out such installation within a fixed contract price already agreed between Kinson to Yim.  Such installation, if indeed carried out, would have been additional work.  Nothing in principle prevented Fat from giving a quotation on such basis, if necessary.  As Miss Lau submitted, I tend to believe that the explanation for the lack of quotation was an afterthought.

79.  Indeed according to Wah, the practice between Kinson and Fat had been that quotation was not normally required.  Due to the history of co-operation between Fat and first AD and then Kinson, the parties had established understanding of the unit cost of various items of electrical work such as the installation of sockets. Fat was supposed to provide both materials and labour; and to submit invoices for their cost when the work was completed.  Kinson would pay Fat or him in the name of the 1^st respondent by cheques.

80.  Fat argued otherwise.  He drew a distinction between the work at the Site and another project at Causeway Bay that Fat admittedly contracted from Kinson.  Much reliance was placed on what was said to be quotation dated 1 August 2008 for Fat’s subcontract for the electrical work in that other project.

81.  The existence of that quotation was not in dispute.  It was dated only 3 days before the accident at the Site.  It transpired during the trial that that quotation was in fact a post-record of the subcontract and signed when the work was almost complete.  Both Wah and Mak confirmed that.  Mak added that it was prepared for record purpose.

82.  Apart from the above quotation, Fat indeed did not produce or refer to any other formal contractual document.  On the contrary, among the documents produced were handwritten invoices submitted by Fat to Kinson.  They set out the items of work done, the material used and the calculation of the cost.  The charges were said to be for both material and labour (or連工包料).  Had Fat been a worker or even a foreman, one would have expected merely calculation of wages at daily rates.

83.  As mentioned, the argument that subcontracting the electrical work to Fat in the name of the 1^st respondent as the registered electrical contractor operated to absolve Kinson from the relevant statutory liability for contracting for such work whilst not be a registered electrical contractor was rejected by the learned magistrate.  Kinson was accordingly convicted.

84.  Being the principal contractor, Kinson could not, and never sought to, evade liability pursuant to section 24 of the ECO.

85.  However, if the Deceased were in fact employed by Kinson at the material time, Kinson, according to Miss Lau, would have been covered by the employees’ compensation insurance. It might be thought that corroborating Fat would have been beneficial to both Fat and Kinson.  Probably because of that and Kinson’s default in appearance did Concord find it necessary to be joined to protect its interest as the insurer of Kinson in these proceedings.

86.  In the circumstances, Miss Lau submitted that there is no reason now for Wah to lie about the relationship among the parties against Fat.  Not going as far as Miss Lau did, I say there is no sufficiently apparent reason for Wah to do so in these proceedings.

87.  There was on behalf of Fat suggestion of difficulty in coping with what Wah might say under a subpoena and the lack of discovery from Kinson.  I think the difficulty was exaggerated, bearing in mind the discovery by Concord of documents effectively from Kinson and Wah’s evidence having been rehearsed and tested before, though in a different court.

Other evidence

88.  Chan was called as witness for Fat.  According to him, he was employed by Kinson.  As junior casual worker, he had to help the other workers, including the Deceased, on the Site if required.  Apart from working with the Deceased at the Site at the same time for a day, I am not impressed that there was any concrete factual basis for escalating his belief that the Deceased was employed by Kinson into fact.

Conclusion

89.  If Fat is to be believed, the court has to first believe in all that he said for the purpose of explaining away what the contemporaneous records of his evidence show.  It would also take the court to believe in the legitimacy of his attack on the Officer and his former legal team.  All that goes beyond clarification or difference in interpretation.  On the balance of probabilities, that is simply too much and it is too dangerous to rely his evidence.

90.  As found by the magistrate and revealed by the evidence, Fat was in fact in direct control and charge of the electrical work as well as how the work was carried out at the Site at all material time.  Those included the necessary control Fat had over the sourcing of materials and hiring workers to work at the Site as well as the execution of the electrical work.  Indeed Fat might have in hands multiple contracts that would take him away from site to site.  That however was not unusual.

91.  I do accept that a person having control and supervision of work and workers is not necessarily a contractor.  The magistrate in his verdict seemed to have taken that view in the context of the statutory liability of Fat.  An employee may well act as the foreman or workman leader.  But that could not enter into my deliberation because Fat’s denial of any involvement in the work at the Site at the material time has shut himself out to such alternative stance.

92.  Contrasting with the evidence of Wah, both in his previous out of court statements and in court, I prefer the evidence of Wah (and Mak).

93.  Considering all the evidence, I find that Fat was at the material time the subcontractor of the electrical work from Kinson at the Site and the employer of the Deceased. Fat is liable as such.

QUANTUM

94.  The dispute between the applicant and Concord in respect of the Deceased’s pre-accident monthly earnings lies in (i) his daily wage and (ii) the number of working days every month before the accident.

95.  There is no dispute that the Deceased started working at the Site on 31 July 2008.  He met his death days later.  Apparently, Mr Lam for the applicant relied on section 11(2) of the ECO:

“where by reason of the shortness of the time during which an employee has been in the employment of his employer or of the casual nature of the employment, or of the terms of employment, it is impracticable to compute the rate of remuneration of such employee at the date of the accident, regard may be had to the average monthly amount which, during the months previous to the accident, was being earned by a person of similar earning capacity in the same grade employed at the same work by the same employer, or, if there is no person so employed, by a person of similar earning capacity in the same grade employed in the same class of employment and in the same district.”

96.  Mr Lam referred to various cheques and receipts but essentially went in some length into the evidence of Chan, who also worked at the Site at the material time, as comparable.  Partly at his initiative and partly led during his evidence, Chan testified that he worked 26 days per month and was paid HK$500 daily wage before the time of the accident.  But he considered the Deceased to be more experienced than him.  The suggestion was that the Deceased probably had a higher daily wage.

97.  Section 11(2) being is premised on the impracticability of computing the rate of remuneration of the employee at the time of the accident.  In that case, regard may be had to effectively the average monthly income of a comparable as defined in the subsection.  Clearly reference may be made to any evidence of what the Deceased used to earn in similar kind of work from other employers prior to the accident.  The comparable under section 11(2) does not have to be a third person.

98.  In the present case, there was indeed evidence from his brother, Kwan Wai Chor (“the Brother”) in respect of the pre-accident monthly earnings of the Deceased.  The Brother understood from the Deceased that the latter earned daily wage of HK$500-600 as a casual worker.  That, according to the Brother, was somehow verified by the receipts for payment of wages discovered after the Deceased’s death.  The evidence is in line with what Fat and Chan said in respect of the Deceased’s daily wage.

99.  The Brother also managed to tell that the Deceased’s income in July 2008, i.e., the month immediately preceding the date of accident.  The Deceased was said to have taken more days off during the first half of that month.  In total, the Deceased worked on 17 to 18 days that month and earned about HK$8,800.  Prior to that, the Deceased, according to the Brother, worked on about 22 days and earned about HK$11,000 per month.

100.  The Brother resided together with other family members and the Deceased under the same roof. The Brother was also fair enough to point out that due to the casual nature of the Deceased’s work, the number of his working days, he reckoned, tended to vary from month to month.  Chan was not in a position to tell the composite employment situation of the Deceased other than when they happened to work for the same employer or in the same project.  These are reasons for giving due weight to the evidence of the Brother in this respect.

101.  In the circumstances, the other evidence referred to by Mr Lam, including that of Chan, serve a cross checking purpose.  Whilst the court may have regard to such evidence, unlike the statutory preference of whichever is the more favourable of the amounts calculated pursuant to section 11(1)(a) and (b) respectively, there is no such preference in favour of a more favourable comparable particularly if the evidence suggests that the employee in reality used to earn relatively less from similar kind of work with various other employers than the comparable referred to.

102.  Considering all the evidence, including cross checking with those heavily relied on by Mr Lam, I find that the Deceased used to earn average daily wage of HK$550 from working on average 22 days per month before the accident.  That made an average monthly income of HK$12,100.  This is the alternative case of the applicant.

Section 6(1) compensation

103.  The Deceased was 36 years old at the time of death.

104.  Accordingly, the compensation under section 6(1) of the ECO shall be HK$550 x 22 x 84 = HK$1,016,400.

Section 6(5) compensation

105.  I accept on the evidence that a sum of in excess of HK$59,000 had been spent on the funeral.  The statutory maximum compensation for this item of claim under section 6(5) of the ECO should be allowed, which is HK$35,000.

Interest

106.  Interest on the compensation shall run from the date of the accident.  The dispute lies in the rate applicable to the period until this judgment.  Whilst acknowledging the usual order for interest over such period to run at half judgment rate, Mr Lam for the applicant submitted that it ought to be full judgment rate.  Mr Cheung for Fat made no submission on this.  Miss Lau for Concord submitted that this is a matter of judicial discretion; and there is no reason in the circumstances of the present case to differ from the norm.

107.  Mr Lam referred to Liu Kwan Ying, widow of Cheung Wai Nung deceased v Me Cheung Engineering & Decoration Limited, DCEC 474/1990 (11 January 1996) where HH Judge Kwan basically adopted the views expressed by HH Judge Downey at page 11 of his judgment in Ho Man Yee and Lam Mei Yuet, dependants of Cheng Wing Kuen deceased v Cheng Chung Fan trading as Sui Hing Watch Company, Shatin Enployees’ Compensation Case 236/1990 (3 July 1991).  That part of the judgment says:

“Mr Cheung sought interest on the amount of the award at 10 per cent per annum from the date of accident. Mr Ho submitted that interest should be at half the rate on judgments……He did so because he considered that the purposes of awards under the Fatal Accidents Ordinance and the Employees’ Compensation Ordinance are the same, namely, to put the dependants in the position of receiving financial relief in a lump sum covering period of time when the deceased would have supported them, but for his premature death. Up to a point I would respectively agree with that proposition. But, there is, in my view, a difference. Whereas damages arising out of some tortuous act are assessed by reference to multipliers and multiplicands related to the actual economic loss and ages or life expectancy of the claimants, the maximum awards under section 6 of Cap 282 are fixed at levels which are not related to the particular circumstances of the deceased or the dependants. Whilst it would not be fair to describe them as arbitrary figures, I do not think that they can be fairly be said to be based on the extent of the future loss of support. By fixing limits by reference to a formula which can quickly and exactly be calculated at the date of the accident, the legislature’s intention, in my view, was that the awards should be treated in much the same way as civil debts. The calculations provided in section 6(1) of the Ordinance, like those provided by the First Schedule, are, in my view, “intended to reflect a general expectation based on average experience and to provide reasonably swift answers in terms of broad justice……In the present case, the widow was entitled, as at the death of the deceased to 84 months’ earnings or $345,000 “whichever is the less”. The earnings were known to the Respondent. He could have paid the lesser sum at a decent interval after the death. The difference between the maximum amount and 4 years of purchase (i.e., 84 x $6,000) is $159,000. I do not see any good reason for further discounting the sum to which the widow is entitled by reducing the rate of interest on the award. For these reasons, I ordered that the awards should carry interest at the rate of 10 per cent per annum from the date of accident to the date of judgment.”

108.  Mr Lam purported to supplement but essentially repeated the above views in submitting that the practice of applying half judgment rate on special damages or non-fatal employees’ compensation should be inapplicable to fatal cases where there is no continuing loss after the date of accident.

109.  The right to compensation may have accrued upon the death of the employee by the operation of section 6(1) of the ECO.  Nevertheless there was still the element of the time between the accident and the applicant’s actual filing of the claim.  The learned Judge in Ho Man Yee suggested that the employer could have made payment of the lesser sum of compensation under the section at decent interval since the date of the accident.  However, the rate of pre-accident monthly earnings for the purpose of assessment could be, and in the present case is, in dispute.  In view of my above finding, the dispute was not unreasonably raised.

110.  Perhaps more importantly, Mr Lam was not able to assist me on any other authorities since the above cases that could together be said to have formed a line of judgments, let alone trend, as opposed to the usual practice of applying half judgment rate in fatal employees’ compensation cases.

111.  If I am to embark on a serious revisit to the issue of interest in fatal employees’ compensation case, I would also have expected assistance on the court’s analysis in the body of authorities that led to the current practice of ordering interest in fatal cases.  I do not have that either.

112.  It is of course fair for Miss Lau to submit that the present case contains no circumstance that cries out for a departure from the usual practice or consideration of an award of a higher interest rate.  I therefore refrain from embarking on this exercise that Mr Lam invited me to do.

113.  Therefore interest on the compensation in the present case (HK$1,051,400) shall run at half judgment rate from the date of accident to today.

Apportionment

114.  There is no dispute that the Deceased resided with the applicant, the Brother, his wife and their 2 infant daughters under the same roof.  It is accepted that the Deceased’s father, in his 70s and retired, remains a dependant.

115.  Except for the section 6(5) compensation in the sum of HK$35,000 which should go to the Brother as reimbursement of funeral expenses, the balance of the compensation shall be apportioned pursuant to Schedule 7 of the ECO:

ORDER

116.  Judgment is entered against Fat and Kinson respectively as the employer and the principal contractor for compensation in the sum with interest as aforesaid.  The compensation shall be apportioned as aforesaid in favour of each of the applicant and the family members respectively.  Interest from today until full payment runs at the judgment rate.

117.  The compensation apportioned to the infants ought to be paid into court pending application for directions within 14 days of such payment.

118.  The applicant shall have her costs of these proceedings against Fat and Kinson, including any costs reserved.

119.  As requested by Miss Lau, I order that Concord’s costs to be borne and paid by Fat but only to the extent occasioned by the contest of the liability of Kinson as the alleged employer.

120.  Costs shall be taxed, if not agreed, with certificate for counsel.  The own costs of the applicant and Fat shall be taxed in accordance with legal aid regulations.

121.  This costs order is nisi; and shall become absolute in the absence of application in 14 days to vary.