YEUNG YUK LIN v. LI MIE CHUN t/a WING SHING TRANSPORTATION

DCEC628/2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES' COMPENSATION CASE NO. 628 OF 2002

______________________

J U D G M E N T

______________________

1. The applicant applies for compensation under section 6(1)(b) and 5 of the Employees' Compensation Ordinance, Chapter 282.

2. The applicant filed her claim based on her husband's death in a traffic accident in mainland China. The respondent denied he was the deceased's employer. He further claimed in court that he and the deceased had been drinking the night before, and he drove off in the truck and then later on met with an accident, causing the death of the deceased. This claim that the deceased was under the influence of alcohol when he was driving and met with the fatal accident was not pleaded in the respondent's answer.

3. For the purposes of record, the respondent was represented at the time the answer was filed, and notice to act in person was filed by the respondent on 10 December 2003, and he represented himself at the trial.

4. It is the applicant's own evidence (Madam Yeung) that the deceased, Yip Chun-wing, was employed as a cross-border truck driver, earning $13,000 per month. In her witness statement, which she produced as her evidence-in-chief, she said that this information was given to her by the deceased in August 2000. In early September 2000, Madam Yeung said the deceased had told her his work would involve working in China and the deceased would return to their home in Tin Shui Wai only two to three times a month and that one week prior to the accident, (the date of accident 26 November) she saw him at home and, according to her, there was nothing to suggest that there were any changes to his work status.

5. Madam Yeung claimed that the deceased had always been an employee, had never worked in business for himself or had ever been self-employed before his death. It is not disputed that the traffic accident involving the deceased took place on 26 November 2000. Neither is it disputed the deceased had died in the respondent's truck which was found submerged in the river on the Guangzhou-Shenzhen Highway in Bao'an District in the vicinity of the Jinbai gas station.

6. In fact, it is the respondent's evidence that he was notified soon after the accident and he went to the scene of the accident as soon as he was notified of the accident on the morning of 26 November 2000. It was also he who informed the applicant, Madam Yeung, in Hong Kong and the deceased's girlfriend in Shenzhen of the death of the deceased.

7. The respondent operated the Wing Shing Transportation Company, in the business of transportation. The respondent, however, denied that he was the deceased's employer. He claimed their relationship was one of partnership, that the deceased, Mr Yip, would pay him $6,000 a month to hire the truck, and whenever the respondent received an order to transport goods between Hong Kong and China, he would give the order to the deceased, and upon delivery of the goods, the deceased would be paid 70 per cent of his transportation fee whereas the respondent would receive 30 per cent.

8. He further claimed that the deceased was entitled to take orders from other sources and other customers, in which case he would then split the transportation fee with the deceased with him taking 15 per cent of the fee. The respondent also claimed that as he would not receive payment for three months, the deceased in turn would not get any payment until three months after he first started this job. He claimed the deceased was working independently and that was what he described was the relationship of partnership. He admitted to have advanced some money to the deceased for payment of toll charges, diesel and other expenses.

9. Madam Yeung, the applicant, disagreed that the respondent was not the deceased's employer. She insisted that the respondent had never informed her after the deceased's death that the deceased was merely hiring the truck from the respondent and that the deceased was on business of his own. Furthermore, Madam Yeung claimed that she was told by the deceased's Shenzhen girlfriend, Cheung Yuk, and her brother-in-law, Lai Ching-leung, that the deceased was receiving a minimum pay of $13,000 a month and he would be paid more if he had done more work.

10. Furthermore, Madam Yeung claimed that Mr Lai told her that the respondent informed him that he had given $1,500 to the deceased to take out an employee's compensation insurance, but the deceased failed to do so.

11. Mr Clough submitted this cannot be true. If the deceased was a hirer of the respondent's truck, he could not be taking out an employee's compensation insurance. It is certainly true that under the statutory requirement, all employers have to take out employees' compensation on all of their workers. The workman cannot take out such an insurance for himself. Only the employer can. The employer will need to produce business registration or company registration before an insurance on employees' compensation can be taken out.

12. Madam Yeung produced three certificates to show that the respondent had agreed to pay her compensation, and this was witnessed and certified by the mediation office of the Shenzhen Public Security Bureau Traffic Control Office at Bao'an. This can be seen on page 17 of bundle C. The 2001 29 August certificate in fact certified that $97,046.60 was to be paid by the respondent to the recipient who was the applicant. This certificate showed presumably they had gone through a mediation process. After this mediation process, the respondent agreed to pay the applicant the sum of $97,046.60, and this certificate was chopped by the Shenzhen Public Security Traffic Control Office and the mediation was done by the mediation office of the Shenzhen Public Security Bureau Traffic Control Office at Bao'an County.

13. The respondent denied this sum was to be paid by him. He claimed he had received compensation from the insurance company in China for his own loss but he himself had to pay compensation to two injured persons on 26 June 2001 which he did. He claimed the 2001 August 29 certificate was the receipt for the two sums he paid the two injured persons.

14. The certificates clearly do not support what the respondent claimed. The sums do not add up for the two certificates stated that they received $39,000 and $40,000 respectively and these persons had signed and acknowledged receipt whereas the applicant's $97,046.60 does not add up to $79,000 that the two other injured persons received. Neither does it state in the certificate of the applicant that she was not to receive the money. Her certificate is identical to the other two that she should be the recipient of this sum of money from the respondent. The applicant claimed that she never received the money from the respondent. The respondent, on the other hand, claimed that she had to go and collect the money herself.

15. I have grave doubts after hearing the evidence of both persons, both witnesses, that Madam Yeung would ever receive this money if she was unable to receive it in 2001 August and she has still not received it in 2004 when she only signed a receipt that the respondent would pay her this sum. She has only to look to the respondent for the receipt of this sum of money. Further, there is no document to show that the respondent should be receiving any money. Neither was there any evidence that the money came from the insurance company.

16. The respondent was cross-examined extensively on his accounts filed for tax purposes. That was produced by him, exhibited in pages 26 to 28 in bundle C. These accounts consisted of Wing Shing Transportation's profits and loss account, the tax computation and two notes attached to the profits and loss account for the year ending 31 March 2001.

17. The respondent claimed to have received an income from transportation of $875,800 for the year. He claimed salaries and wages of $288,000, repair and maintenance and tyre replacements and motor vehicle checking fee of $35,820. Two further items claimed as expenses were motor vehicle expenses of $174,630 and transportation of $114,000, and these were claimed as expenses.

18. When questioned as to what were the last two items, the respondent was evasive and unable to give a direct answer. He claimed that the former was for fuel and the other, parking fees. It was further the respondent's evidence that he had never employed any workers. He had only hired out the vehicles to the drivers and they would pay him rental or hire charges. However, no such item appeared in the tax computation or the profits and loss account.

19. It was also his evidence that the drivers would be responsible for diesel oil, toll fees and other such expenses, and he would only be responsible and liable for the "牌頭費" which I presume was the licence fee for the truck to be driven into China. If the transportation goods vehicles were owned by the respondent, and they were hired out to drivers, why would the respondent be responsible for car-parking fees and diesels or petrol? This is also contrary to what he told the court he had agreed with the deceased as a term of the hiring of the truck.

20. Furthermore, in note 2 of the profit and loss account on page 27(c) of the bundle, under "salaries and wages," there were four names listed apart from the respondent's own name as persons receiving a salary or wage in that year. The deceased's name was noticeably absent. The respondent claimed that these four were his drivers who had hired his vehicles during that year. He admitted although during that year, the deceased was one of the drivers who hired his vehicles and had hired his cross-border vehicle, he did not put his name down because he had not yet received any payments.

21. The respondent was unable to explain if none of the drivers were the respondent's employees, why should they be receiving a salary or a wage. I presume the purpose of the respondent's production of this document - (the tax papers) was to show the deceased was not his employee, but this document in fact supported the fact that he was employing drivers to drive his transportation vehicles.

22. He had also paid for the petrol, the diesel consumed and the parking charges of these vehicles that he owned. It is clear that the amount that he claimed as his expenses under these two heads were not small sums, and it is also clear that the vehicle driven by the deceased, FF2095, was amongst one of the vehicles that he owned during that year.

23. I have been referred to a number of cases on employees' compensation claims and the claimant or applicant were cross-border lorry drivers. These are the case of Lam Chi-kau v Fong Wai-man DCEC No. 29 of 1996, a judgment by my brother judge Chan on 3 February 1999, and the case of Chan Kam-wing v Esprit Container Transportation China Limited DCEC No. 4 of 2000. Date of judgment: 15 September 2001.

24. In both cases, both judges found after hearing evidence at the respective trials, on the finding of facts, that the applicants were the employees of the respondent. Clearly, it is a matter of fact in each individual case whether the cross-border driver was on a contract of employment or whether the applicant or the deceased was in business of his own, driving a cross-border lorry.

25. In the present case, I would have to look at the facts in this case to determine whether the deceased was an employee of the respondent or whether he was, as the respondent said, on business of his own. I find, after hearing the respondent giving evidence and after reading his witness statement that he was an unreliable witness. His evidence was completely self-serving.

26. I also reject the evidence of his witness, Mr Wong Ka-o. As far as his evidence on the night of 25 November 2000 is concerned, it is incredible for him to recall a conversation between the respondent and the deceased that took place in August 2000. A conversation that involved the agreement whereby the deceased would end up driving the respondent's truck, even if he was within hearing of the conversation, it would be incredible for him to recall the details of the agreement, particularly when the contents did not concern him at all.

27. I also find that Mr Wong was a longstanding friend of the respondent and it would not be unlikely that he would say anything that the respondent asked him to say, and considering the documentary evidence, particularly the tax documents, profits and loss account that the respondent produced and the evidence given by Madam Yeung, I accept on the balance of probabilities that the deceased was employed by the respondent to drive his cross-border truck. The deceased was the only driver named to drive this truck between Hong Kong and China.

28. I further accept that the deceased was employed as a driver and he was promised a monthly wage of $13,000 by the respondent, and it was because of this relationship the respondent was naturally concerned when he received news of the traffic accident involving his truck and the deceased.

29. As to the issue of whether the deceased was driving under the influence of alcohol, the respondent failed to plead section 5(2)(d) or (3) of the Employees' Compensation Ordinance, Chapter 282. As the respondent denied he was the deceased's employer, it is understandable that he did not or his then solicitor did not plead section 5(2)(d) in the answer.

30. However, even if it was so pleaded, there was no evidence adduced that the deceased was driving under the influence of alcohol at the time of the accident. There was evidence from Mr Wong, witness called by the respondent, that the deceased was drinking at a karaoke bar in Wong Kong and had left at 1.30 am on the 25th or the earlier morning of 26 November 2000 but there was no evidence from anyone or the Public Security Bureau in Bao'an that the deceased was under influence of alcohol when the accident took place in the morning of 26 November 2000. There was no evidence on the quantity of alcohol consumed by the deceased the night before. Neither was there a blood test of the deceased by the Public Security Bureau after the accident, neither was there any evidence as to the time of the accident.

31. Under section 5 of the ordinance, the employee was deemed to be in the course of employment if there are no evidence to the contrary. There was evidence from the respondent that the deceased was not successful in delivering the goods to the destination the night before and he was presumably in the early morning of 26 November on his way of delivering the same goods when the accident happened. Consequently, when the accident happened, the accident was deemed to have arisen out of and in the course of the deceased's employment under section 5(4)(a) and (b) of the ordinance. It follows that the respondent is liable under the ordinance to pay the compensation to the applicant.

Quantum

32. The compensation payable under section 6(1)(b) of the ordinance is monthly salary x 60 times, and that makes it $780,000, and the funeral expenses under schedule 6 of the ordinance is $20,000. I will therefore award the total sum of $800,000.

(Court discussion re quantum)

Interest

33. I award half judgment interest from the date of writ to the date of judgment on a judgment sum of $800,000. Costs follow the event. The cost is to be borne by the respondent, to be taxed if not agreed, with certificate for counsel. Applicant's own costs to be taxed in accordance with Legal Aid Regulations.