TANG YAM KAU v. KEY ASIA ENGINEERING LTD

DCEC 694/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 694 OF 2011

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JUDGMENT

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Background

1. On 18 May 2011, the applicant filed an Application with this Court against the respondent claiming employees’ compensation under sections 9, 10, 10A of the Employees’ Compensation Ordinance (Cap 282) (“the Ordinance”).

2. According to the applicant’s case, he was employed by the respondent as a carpenter at the time of the accident which happened on 13 October 2010.  On 13 October 2010, the respondent instructed him to carry out certain carpentry work at the premises situated at 4/F, Tai Pak Mansion, Li Po Lung Path, Kennedy Town, Hong Kong (“the workplace”). 

3. For such purpose, the applicant was required to cut a wooden board of about 4 inches (in width) x 30 inches (in length) by using a bench type electric circular saw (“the circular saw”) provided by the Respondent at the workplace.  At that time, the circular saw was not fitted with any crown guard to prevent the applicant’s hand from accidentally coming into contact with the revolving saw blade during work. Neither was there any riving knife fitted in direct line behind the circular saw.  At such, the saw blade protruded above the bench was totally exposed during the cutting operation.  Further, the respondent did not provide any push stick to the applicant for such wood cutting operation.

4. While the applicant was cutting the wooden board under the aforesaid circumstances, his left hand was cut by the circular saw (“the accident”).

5. On 2 June 2011, the respondent filed an Answer disputing liability by alleging, inter alia, the applicant was not its employee at the time of the accident.

6. On 7 February 2014, the respondent sent its company representative to attend a direction hearing when His Honour Judge Kent Yee fixed the trial dates at 19 and 20 May 2014.

7. Nonetheless, on both dates of the trial hearing, the respondent did not send any lawyer or its company representative to attend.  The respondent knew of the trial dates in advance, but did not appear at the trial hearing.  In these circumstances, I considered that it was appropriate to proceed with the trial in the respondent’s absence.

Liability

8. At trial, the applicant adopted the evidence as set out in his witness statement and supplemental witness statement dated 6 October 2011 and 13 March 2014 respectively.  On other hand, there is no evidence coming from the respondent to challenge the applicant’s case or his evidence.

9. In passing, it is notable that in connection with the accident, the respondent was also convicted after trial in Kowloon City Magistrates’ Court on 25 March 2013 for the following offences:-[1]

(1)  Failing to give notice of non-fatal accident of an employee, contrary to sections 15(1A)(a) and 15(6) of the Ordinance under case no ESS 035112/2012.

(2)  Failing to take out insurance policy for employees, contrary to sections 40(1) and 40(2) of the Ordinance under case no ESS 035113/2012.

(3)  Failing to pay compensation to employee, contrary to section 10(10) of the Ordinance under case no ESS 035114/2012.

(4)  Failing to pay compensation to employee, contrary to section 10(10) of the Ordinance under case no ESS 035115/2012.

10. After going through all the relevant evidence as produced by the applicant in this case, I accept all the evidence as given by the applicant in his witness statements on the employment relationship between himself and the respondent and how the accident happened on 13 October 2010 and its surrounding circumstances.  His case is inherently probable and consistent with his evidence.  In view of the aforesaid, I accept on balance of probabilities the applicant’s case as set out in Paragraphs 2 to 4.  In particular, I find that applicant was the respondent’s employee at the time of accident, at which he sustained injuries to his left hand.  And the accident also arose out of and in the course of his employment with the respondent.

11. Under section 5(1) of the Ordinance, the respondent is therefore liable to pay compensation to the applicant in accordance with the Ordinance.

The compensation

Monthly earnings

12. The applicant was 51 years old at the time of accident.  In his witness statement, the applicant said that the respondent paid him at a daily wage of HK$800.  The applicant produced a table for “Hong Kong Construction Worker Payroll” (updated to 15 October 2013) published by the Hong Kong Construction Industry Employees General Union at trial.[2] According to such table, the relevant union rate for the trade of carpenter was $820 per day in January 2009, and $850 per day in November 2010.

13. At trial, the applicant testified that he had a practice of marking his workday on the calendar at home after returning from work.  Copies of the relevant pages of such calendar are contained in the trial bundle.  As can be seen from the two relevant pages for the months of September and October of 2010, the applicant worked for a total of 25 days in the month immediately preceding the accident.[3] The applicant said that he worked for the respondent in all those 25 days.  I find such evidence credible.  Among other things, I observe there is also the unchallenged evidence that the respondent would check with him at the end of each month the number of his workdays before they paid for his entitled salary.  So, it is inherently probable that he needed to make his own record of workdays for such a purpose.

14. Having considering all the relevant evidence as available in this case in relation to this pre-accident income position and pursuant to section 11(1)(a) of the Ordinance, I find his monthly earnings at the time of accident to be:-

$800 per day x 25 days = $20,000

15. However, this is not the end of the matter in relation to the applicant’s monthly earnings for the purpose of calculating his compensation under section 9 and section 10 of the Ordinance. Miss Wong, the applicant’s solicitor representing the applicant at trial, also invited the court to make the statutory adjustment to the said monthly earnings of $20,000 in accordance with the relevant rates of increase in the ‘Consumer Price Index’ at the ends of both of the 12-month period and the 24-month period after the date of accident.  Miss Wong based her submission on section 11(1A)(b) and section 11(1B)(b) of the Ordinance.  I would deal with this matter in details at the appropriate juncture below.

Section 9 compensation

16. Apart from the monthly earnings, the applicant’s loss of earning capacity as permanently caused by his injuries sustained in the accident (“the subject loss of earning capacity”) is the other main consideration I need to decide upon for properly assessing the appropriate section 9 compensation in this case.

The assessment by the Employees’ Compensation (Ordinary Assessment) Board (“the Ordinary Assessment Board”)

17. On 23 September 2011, the Ordinary Assessment Board assessed the subject loss of earning capacity at 5.5%.  On 8 February 2013, such assessment was varied to 12% upon review.

18. As seen from the Certificate of Review of Assessment issued on 8 February 2013 (“the Form 9”)[4], the Ordinary Assessment Board assessed the applicant to have suffered the following injuries as a result of the accident:-

“Left hand injury resulting in (i) left middle finger distal interphalangeal joint, proximal interphalangeal joint and metacarpophalangeal joint pain and stiffness; (ii) left thumb interphalangeal joint and metacarpophalangeal joint stiffness and pain; (iii) psychiatric impairment.”

Section 18 appeal

19. On 8 March 2013, the applicant lodged an appeal against the Ordinary Assessment Board’s assessments as shown in the Form 9 within time in accordance with section 18 of the Ordinance.[5]

20. The Court of Appeal has provided guidance to the court in hearing appeal of this sort in Chan Kam v Sam Wo Industrial Manfactory[6] and in Chan Kam v Standard Chartered Bank Hong Kong Trustee Ltd[7] (see also: the observation of Deputy District Judge Bharwaney (as his lordship then was) made in Chu Chin Yiau v Ray On Construction Co Ltd[1992] 1 HKC 246, at pp 248G-I and 253H).

21. In light of the above decisions, basically, before I can say whether the Ordinary Assessment Board’s assessment is right or wrong in this case, I need to start afresh by taking into account the totality of the available evidence, particularly the medical evidence, to properly assess the subject loss of earning capacity.

22. When assessing the loss of earning capacity occasioned by non-scheduled injuries[8] pursuant to section 9(1)(b) and the provisos thereof, I may make reference to the relevant expert’s opinion on the percentage of the subject loss of earning capacity.

23. In Chan Yuet Keung v Harmony (International) Knitting Factory Ltd[2010] 5 HKLRD 599, Bharwaney J at paras 53, 58 and 60 of his judgment said:-

“53.  The basic principles regarding the admissibility of expert evidence are reasonably clear.  To be admissible, the opinion evidence must qualify as “expert evidence” for the purpose of section 58 of the Evidence Ordinance, Cap 8, and it must be relevant in the sense that it is helpful to the court in arriving at its decision on one or more of the issues to be resolved.  If the court is able arrive at its own decision on the issue, by applying its own knowledge and experience to the facts proved in evidence, expert opinion on the same matter may be excluded on the ground that it is not helpful to the court. 

…

58. In cases of non-scheduled injuries, the assessment of loss of earning capacity, pursuant to section 9(1)(b) and the provisos of that sub-section, must reflect and be proportionate to the fixed statutory percentages provided for the scheduled injuries.  Medical experts, particularly orthopaedic experts, are familiar with the First Schedule of the ECO and the Notes thereto and are adept at assessing the percentage of loss of earning capacity for non-scheduled cases and they regularly do so when preparing in their expert reports for employees’ compensation cases.  Those reports are admissible and of assistance to the District Court in assessing compensation for non-scheduled cases which do not require special treatment under the provisions of section 9(1A). 

…

60.   Expert opinion on the percentage of loss of earning capacity is helpful and admissible in employees’ compensation proceedings.  The guidance that Rogers JA has offered to the courts assessing damages at common law should not be so readily accepted, as it appears to have been done, by the courts assessing employees’ compensation ...  The expertise of the medical practitioner in assessing the percentage of loss of earning capacity for non-scheduled cases is likely to be of assistance to the court assessing employees’ compensation.  Chan Kam v Standard Chartered Bank Hong Kong Trustees Ltd [1988] 1 HKC 345 is an example of a case where the Court of Appeal found the opinion of the expert on the percentage of loss of causing capacity to be of assistance...”

The medical evidence in this case

24. After the accident, the applicant was sent to A&E Department of Queen Mary Hospital (“QMH”).  The physical examination there revealed lacerations over three web spaces with tendon exposed, one at left ring finger and one at left thumb.  The orthopaedic Department of QMH subsequently confirmed that the applicant suffered from complex multiple deep structure injuries, involving complete cut of the thumb and middle finger flexor tendons, multiple digital artery and nerve cuts, nail injury, ring finger extensor tendon cut and intra-articular fracture. 

25. On 16 October 2010, tendon and nerve repair was performed and he was discharged from hospital two days later. Thereafter, the applicant had received extensive physiotherapy and occupational therapy for rehabilitation.  He also attended regular follow up visits with QMH’s specialist outpatient clinic.  At the visit on 12 May 2011, the attending doctor observed that his injured fingers remained stiff and weakened.  He was unable to make a full fist.  On 11 June 2011, he attended the A&E Department of Prince Margaret Hospital (“PMH”) because of persistent left hand pain.

26. In total, the applicant received 55 sessions of physiotherapy treatment at David Trench Rehabilitation Center (“DTRC”)[9]. The program started on 10 November 2010 and lasted until 10 June 2011.  On the last visit, the power grip of his left hand was 18 kgf and that of his right hand was 48 kgf.

27. The applicant also attended the occupational therapy department of QMH from 20 October 2010 to 1 November 2010.  Thereafter, in addition to physiotherapy treatments received at DTRC, he also attended their occupational therapy department for splint program, mobilization and work training.  According to the medical notes and records, he received seven sessions of occupational therapy at DTRC during the period between 10 November 2010 and 13 May 2011.[10] The result of the occupational assessment done on 13 May 2011 reveals that his overall performance did not match with his previous job demand with significant degree of limitation, and he was suggested to change his job.  At that time, he was also observed to be limited in lifting force and be inadequate in his left grip force for tool operation.

28. In the OT Rehabilitation Outcome Report prepared by QMH dated 15 July 2011, it is recorded under the heading of ‘work history’ that:-

“Occupational Title : Decorator

Physical Demand Characteristic Level : Heavy

…

Essential job tasks:-

- Build, repair and install counters, ceiling, benches, partition, floor, door using hand tools

- Build / install wooden furniture using machines and hand tools

Critical Physical or Psychological Demands of the Occupation:-

- Bilateral lifting 30-100 lb within shoulder level

- Bilateral lifting above shoulder level 30-40 lb

- Left strong grip and finger force to stablise object for fixing

Left good dexterity in manipulating nails and screws”

29. Apart from the orthopaedic injuries, the applicant also experienced depression and other related mood symptoms after the accident. According to the A&E Department notes of PMH dated 2 September 2011, it is recorded that he had suicidal idea and low mood.  He was then admitted to emergency medicine ward for psychiatric consultation.  He was diagnosed to have adjustment disorder with depressive features.  He was treated with medication and referred to West Kowloon Psychiatric Clinic (“WKPC”).

30. The applicant first consulted WKPC on 24 October 2011.  According to the report issued by WKPC dated 28 January 2013, it is stated, inter alia, that:-

“… He first took notice of mood symptoms in January 2011, as he began to worry about the progress of recovery from the injury on duty (IOD) that happened 2 months previously …

... Symptoms of depression began to affect in January 2011. Mr Tang felt miserable and irritable; he had intrusive recollections of the scene of blood gushing out as the machine cut into his hand; he had trouble falling asleep and had recurrent dreams of the injury; also, he had fleeting suicide thought when he was alone and overcome with self-pity.

On the other hand, he had fits of temper when he came to think of IOD with a remote hope of recovery and his returning to his former functioning and his employer’s response to the IOD...

… Since October 2011, Mr Tang’s mood has taken a turn for the better, though he was still far from being well.  He has no longer had the idea of impulse of hurting himself.  He has managed to get 3-4 hours of sleep; and, he has had fewer nightmares and intrusive recollections about the IOD.  Yet, he has become sentimental and prone to bursts of tear…”

31. The same report also mentions that WKPC diagnosed the applicant to have suffered from adjustment disorder with prolonged depressive reaction.  He regularly attended WKPC for treatment and was prescribed with antidepressant drug.  He was also referred to their clinical psychological for further in-depth counseling.

32. In addition, the applicant received clinical psychological treatment from WKPC during the period between 21 March 2012 and 15 August 2012.  He had two individual and four group cognitive-behavorial therapy and 3 out-patient sessions of clinical psychological services at WKPC.

The medical experts’ assessment of the applicant’s orthopaedic and psychiatric condition

33. On 26 August 2013, Dr Fu Wai Kee (“Dr Fu”) conducted a thorough medical examination on the applicant’s orthopaedic condition.  According to his medical report dated 27 September 2013, it is noted at the time of the medical examination, the applicant complained of, inter alia, pain, weakness, and stiffness at his left thumb, middle finger and ring finger.  The on and off pain was aggravated by movement and sometimes sporadic.  He could not lift weight by his left hand.  Also, there was painful mass over the dorsum of the left ring finger in the one year before the medical examination.

34. Dr Fu opined that the clinical picture of the applicant is compatible with the diagnosis of left hand cut injury with multiple tendons, nerves, digital arteries and bones fracture as caused by the accident.  There is no evidence of any pre-existing pathology.  His prognosis of the applicant was that the left hand condition should be static and his hand impairment would persist.  In Dr Fu’s view, the applicant will need symptomatic treatment on a need to basis, and will have some difficulty in performing dexterous work and manual exertion with his left hand.  Being conscious of the fact that the applicant’s right hand was his dominant hand, Dr Fu opined that the applicant could not resume his pre-accident job as a carpenter that required manual exertion and frequent usage of left hand.

35. From the orthopaedic perspective, Dr Fu estimated the applicant’s impairment of whole person and loss of earning capacity both to be 13%.[11]

36. On 26 November 2013, the psychiatric expert, Dr Chow Lok Yee (“Dr Chow”) conducted an interview with the applicant lasting for about two and a half hours. 

37. In the psychiatric report dated 9 January 2014 prepared by Dr Chow, it sets out comprehensively the psychiatric symptoms as encountered by the applicant.  Some other helpful information concerning the applicant’s psychiatric condition (apart from those already mentioned above) can also be found in such report:-

“15. … He underwent intensive rehabilitation programme delivered by the physiotherapists and occupational therapist. He attended intensive treatment for 4-5 times per week and the programme lasted about 4 months. The physiotherapy and the occupational therapy were terminated about one year after the accident. During the stay in Queen Mary Hospital, he developed insomnia and experienced nightmares about getting lost. He often cried when he attended physiotherapy and occupational therapy…

…

17. Few months after the injuries, in early 2011, he experienced sustained low mood and started to be easily irritable because he started to worry about financial difficulties as he was the breadwinner of the family…

18. The depressed mood further deteriorated in mid 2011. He often cried and had suicidal ideas that he wanted to use a pair of scissors to stab into his chest to take his life… He felt shameful as he previously was the breadwinner of the family before the occurrence of the accident. He revealed to the social worker again that he wanted to commit suicide though he knew he should refrain from such act as he had to look after his children. He was very stressful as he was the breadwinner and all of his three children were studying and his wife was a full time housewife before the occurrence of the accident. She had to work to relieve the family’s financial difficulties. The social worker brought him to the Accident and Emergency Department of Princess Margaret Hospital…

19. He became socially withdrawn as he felt inferior to his colleagues as he could not work and receive no salary.  And he had financial problem.  He avoided social gathering despite invitations by his colleagues.”

38. According to Dr Chow, the applicant’s mood was often low at the interview and he was very easily irritable.  By that time, he had been emotionally uncontrollable about once in ten days, when he could become extremely temperamental.  He feared he may get into disputes with others over trivia in the public and would get into a fight.  He thought drugs do not have an immediate effect to calm down his emotional outburst and preferred to do exercise to deal with the regular occurrence of his unstable emotion.  Although he had seldom had any suicidal ideas by the interview, his memory and concentration turned poor.

39. In Dr Chow’s opinion, the applicant’s psychiatric condition was compatible with a diagnosis of ‘adjustment disorder with depressed mood’ fitting the DSM-IV diagnostic criteria.  Dr Chow opined that the stressors that caused such psychiatric disorder include physical injuries with residual pain, numbness and stiffness and significant functional impairment in his left hand and subsequent psychosocial adversities (like unemployment and the associated financial strain).  Dr Chow also opined that the applicant’s psychiatric condition was solely caused by the physical injuries sustained in the accident.

40. Dr Chow further commented that from the psychiatric perspective, the applicant’s current psychiatric disabilities would play a minor role in affecting his resumption to his pre-injury occupation. His depressed mood would nonetheless affect his pain tolerance, and his concentration and memory was impaired.  In Dr Chow’s view, the nature of his psychiatric impairment includes depressed mood, irritability, sleepiness and memory and concentration difficulties, although the degree of impairment is considered to be mild.

41. Dr Chow estimated the permanent psychiatric impairment of whole person of the applicant due to the accident at 4% and his loss of earning capacity due to such psychiatric condition also at 4%.[12]

42. I consider the aforesaid opinions of Dr Fu and Dr. Chow reasonable and being consistent with the medical evidence disclosed in this case.  I accept their expert evidence as set out above.

43. Also, I find the applicant’s left-hand injuries and the corresponding residual disabilities, and his psychiatric impairment described above were caused by the accident.

Assessment of the subject loss of earning capacity under Section 9

44. Section 9 provides the statutory framework for the court to assess the subject loss of earning capacity.

45. The orthopaedic and psychiatric injuries suffered by the applicant as caused by the accident are not specified in the First Schedule to the Ordinance (“the First Schedule”), and they are such ‘non-scheduled injuries’ as referred to by Bharwaney J at para 58 of his judgment in Chan Yuet Keung (supra).[13]

46. After taking into account the totality of evidence in this case, including the applicant’s evidence as given in his witness statements and at trial as well as the medical evidence (bearing particularly in mind the degree of severity of his physical injuries, psychiatric impairment and residual disabilities as highlighted above), and also making reference to the expert opinions of Dr Fu and Dr Chow on the percentage of loss of earning capacity set out in their expert reports, I assess the subject loss of earning capacity at 17% in accordance with section 9(1)(b) of the Ordinance.  In making such assessment, I have also regard to the fixed statutory percentages set out in the First Schedule including those percentages corresponding to ankylosis of joints of the relevant fingers, and the notes thereto.

47. As per the statutory mandate provided in section 9(1A) of the Ordinance, I need to ascertain whether there are any potential special circumstances of this particular applicant which may render my assessment based on section 9(1)(b) alone being substantially less than his actual loss of earning capacity after taking into account such potential special circumstances.[14]

48. In the Court of Appeal’s decision in Mak Tin Chun v Yeu Shing Construction Co Ltd[1991] 2 HKLR 460, Macdougall J at p 464B-E said:-

“ It is evident that Dr Wong, and likewise Drs Chan and Ho, were proceeding on the assumption that all relevant factors were built into the guidelines. They seem to have thought that in a scheduled injuries case a percentage taken directly from the First Schedule and in other cases one derived from an application of the guidelines was not provisional but final in that it produced the Ordinance answer. Perhaps because they were unaware of it, they failed to take into account the effect of s 9(1A) of the Ordinance which requires the initial Ordinance calculation must be checked against the impact upon the particular claimant of the actual realities of the market.”

49. In Chan Kam (supra), Hunter JA at p 348F-H said:-

“  We therefore cannot agree with the conclusion that the judge reached upon the evidence.  We must make our own assessment, and are in as good a position as he was to do so.  We start with section 9, and are minded to agree with the doctor's inference as to the basis of the Board’s assessment i.e. that it was made under section 9(1).  This leads us to section 9(1A).  Are there special circumstances here which show that the appellant’s actual loss of earning capacity is considerably greater than the 20% produced by any basic ordinance calculation?  Because if there are, the true loss must be ascertained proportionally to a “permanent total incapacity” calculation based on section 7.”

50. It is notable that the applicant was a skilled carpenter and had 30 years of experience in such trade before the accident.  According to the government occupational therapist and Dr Fu, the applicant was not physically fit to resume to his pre-accident job as a carpenter.[15]  In my view, such features may potentially amount to the section 9(1A) special circumstances due to his vast experience and considerable skill in the field of carpentry which he can no longer rely on to earn his living.

51. In his export report, Dr Fu suggested the applicant may shift to other light duty jobs such as office assistant or cashier.  Unfortunately, there was absent before me any evidence showing the relevant wages of any alternative employments whether as suggested or otherwise.  I cannot simply take judicial notice of such wages.  In these circumstances, the formula in Hong Kong Paper Mills Ltd v Chan Hin Wu[1981] HKLR 556, as modified in Lui Kwong Yan v Shui Hing Decoration Works & Anor[1993] 1 HKLR 168 (“the Hong Kong Paper Mills formula as modified”) cannot be applied to assess the applicant’s actual loss of earning capacity here.  SeeMak Tin Chun v Yeu Shing Construction Co Ltd[1991] 2 HKLR 460, per Macdougall J at pp 465B to 466F.

52. Given the aforesaid and after carefully surveying the circumstances of this case, I do not feel able to effectively quantify the percentage of the applicant’s loss of earning capacity by referring to the potential special circumstances as mentioned in Paragraph 50 above without applying the Hong Kong Paper Mills formula as modified.  I also paid attention to the applicant’s age, education level and other factors which may affect his employability, including the risk of his unemployment in the labour market as may be affected by his injuries and residual disabilities.  However, in this particular case, I cannot effectively quantify the contribution of these other factors to the percentage of his loss of earning capacity without properly working out the percentage of loss of earning capacity due to his inability to resume to his pre-accident job but is physically fit to take up such alternative employment as suggested by Dr Fu.  Speaking in terms of his earning capacity, this is not a case where the applicant is physically or mentally unfit to engage in any gainful employment at all. Basing upon the available medical evidence especially the views of Dr Fu and Dr Chow, prima facie, the applicant should be able to discharge the job duties of cashier or office assistant without encountering significant difficulties.  To say the least, there is no sufficient evidence before me to demonstrate the otherwise.

53. In fact, at the trial hearing, Miss Wong only asked this court to find the percentage of applicant’s loss of earning at 17% by relying solely on the two experts’ opinions.

54. Given the peculiar circumstances of this case, I consider that it would be right and fair for me to confine my assessment of the applicant’s loss of earning capacity pursuant to section 9(1)(b) alone.

55. In the premises, my overall assessment of the subject loss of earning capacity remains at 17%.  I would therefore order the relevant assessment of 12% made by the Ordinary Assessment Board be varied and substituted by this court’s assessment at 17%.

Section 10 compensation

56. In the Form 9, the Ordinary Assessment Board has certified the following periods of absence from duty on the part of the applicant being necessary as a result of the accident:-

(1)   13.10.2010 to 06.08.2011;

(2)   08.08.2011 to 08.09.2011; and

(3)   30.09.2011 to 30.01.2013.

57. The medical certificates issued by the attending government doctors as produced by the applicant for this trial not only cover the aforesaid periods but also extend beyond continuously until 27 May 2014.[16]

58. The respondent has not paid any periodical payments under section 10 to date.  Neither has the applicant actually taken up any employment since the accident.

59. The applicant applied under section 10 for periodical payments for his temporary incapacity for the full 36-month period (ie from 13.10.2010 up to 12.10.2013) since the date of accident (which was also the date of the commencement of his temporary incapacity).  In this connection, he also appealed against the Ordinary Assessment Board’s assessment on the sick leave period as certified in the Form 9.

60. The applicant’s entitlement for periodical payments during the initial 24-month period is as of right so long as he can prove his case in accordance to section 10.

61. As for his claim for periodical payments during the last 12-month period, it is subject to the court’s exercise of discretion under section 10(5).

62. Section 10(2) provides that:-

“(2) For the purposes of this section a period of absence from duty certified to be necessary by a registered medical practitioner, a registered Chinese medicine 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.”

63. In Sin Fu Yau v Wong Po Kee Ltd & Anor[2007] 1 HKLRD 159, Deputy District Judge Anthony Chow, after conducting a careful and detailed analysis of the previous authorities discussing on the legal effect of section 10(2), held that in the absence of fraud, either by the certifying doctor or the employee, the presumption of total temporary incapacity under section 10(2) is irrebuttable.[17] I respectfully agree to the learned Deputy Judge’s view.

64. According to my reading of section 10(2), such irrebuttable presumption should equally apply to the initial 24-month period as well as to the extended 12 months period (which is subject to the court’s discretion).  For, this subsection itself expressly provides that it would apply for the purposes of ‘this section’ (ie section 10) without confining its applicability only to the initial 24-month period.  I do not see any legitimate reason to apply differential treatments to these two respective periods.  It appears that the court in Sin Fu Yau (supra) and in Cheung Wan Lun(supra)also took a similar view on this point.[18]

65. In Choy Wai Chung v Chun Wo Construction & Engineering Co Ltd[2001] 2 HKLRD 803, Rogers VP discerned one of main purposes behind the provisions of section 10 was to alleviate the problem of some injured employees who may not receive adequate compensation for his prolonged period of temporary incapacity under certain circumstances.  At pp 805G-806C, his lordship said:-

“ 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.”

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.

     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.”

66. With such statutory purpose in mind, when Rogers VP came to construe how the discretion under section 10(5) should be exercised to extend or not to extend the period of periodical payments beyond the initial 24-month period (after the commencement of an injured employee’s temporary incapacity), his lordship had the following to say at p.807D to J:-

“ 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.” 

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.

   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.”

67. On the point of discretion, I do not see any sensible distinction can be drawn between this case and Choy Wai Chung. In particular, I observe that the relevant sick leave periods in this case as well as in Choy Wai Chung were both duly certified by the Ordinary Assessment Board and the attending government doctors as being necessary as a result of the accident.

68. By virtue of the presumption under section 10(2), the applicant’s absence from work during such sick leave periods were deemed to be periods of total temporary incapacity.  Also, I find no evidence of fraud as would be required according to the above authorities to compel me not to apply the deeming provision of section 10(2) in this case.

69. For completeness sake, it would be fair for me to point out that the sick leave periods certified in the medical certificates for the applicant’s left hand injuries were up to 24 October 2011 only.  From 24 October 2011 onwards, all the medical certificates issued were related to his depression problem.  And Dr Chow specifically commented that on psychiatric ground, sick leave for 12 months commencing from the date of first psychiatric attendance on 24 October 2011 is appropriate.

70. Yet, it is not uncommon to find different doctors to have different opinions on the appropriate length of sick leaves. However, such difference in opinions per se does not necessarily mean the attending government doctor concerned had not given due consideration to the applicant’s psychiatric condition before he made his diagnosis and certified the necessity of the relevant periods of sick leave.[19] One should not lose sight of the fact that section 10(2) mandates the deeming effect irrespective of the outcome of the injury.  And evidentially speaking, there is nothing in this case to suggest the government doctors attending the applicant have not given such due consideration.  In these circumstances, notwithstanding Dr Chow’s view on this particular issue, I would nonetheless find the deeming provision still applicable here. 

71. Apart from the aforesaid, I am also satisfied that the applicant’s total temporary incapacity in the 36-month period as referred to in Paragraph 59 above was caused by the accident having regarded to the totality of the evidence in this case.

72. Particularly, the applicant gave evidence that he had been healthy all along before the accident.  From the orthopaedic perspective, Dr Fu discerned no evidence of any pre-existing pathology of the applicant. Speaking about his psychiatric condition, although it is mentioned in Dr Chow’s psychiatric report that he had a history of vague persecutory idea with fear occurred 20 years ago, and for that reason he was referred to South Kwai Chung Psychiatric Centre.  However, Dr Chow further commented that there had been no recurrence of similar symptoms for the recent 20 years.  Neither was there any previous history of his suffering from depression before the accident.  Dr Chow concluded that the applicant has no pre-existing psychiatric disorder as related to the present psychiatric condition.  I also accept Dr Chow’s medical opinion in this regard.[20] Besides, in relation to the sick leave period after 24 October 2011, the attending government doctor stated in the relevant medical certificates that the diagnosis of depression was related to the applicant’s injury on duty happened in October 2010.[21]

73. Given the aforesaid and the actual number of days of sick leave as certified by the Ordinary Assessment Board and the attending government doctors, I find the applicant is entitled to claim for the section 10 compensation for the initial 24-month period since the date of accident as follows:-

(1)   1^st year (13.10.2010 to 12.10.2010)  – 343 days[22] and

(2)   2^nd year (13.10.2011 to 12.10.2012) – 12 months

74. As for the last 12-month period in the 3^rd year, since I am satisfied that the applicant also suffered total temporary incapacity and such total temporary incapacity was caused by the accident for reasons as explained above, it would be fair in all the circumstances for me to exercise my discretion as per section 10(5) to allow such extended period in full, bearing in mind what Rogers VP said in Choy Wai Chung (supra).

Statutory adjustments to monthly earnings pursuant to section 11(1A)(b) and section 11(1B)(b)

75. As mentioned in Paragraph 15 above, I now deal with the impact of section 11(1A)(b) and section 11(1B)(b) on the applicant’s claims under section 9 and section 10.

76. Sections 11(1A) and (1B) provide thus:-

“(1A) Where an employee suffers temporary incapacity after an accident and such incapacity extends beyond 12 months after the date of the accident the monthly earnings of an employee at the time of the accident shall, in respect of temporary incapacity beyond the 12-month period after the date of the accident, be computed for the purposes of section 6, 7, 9 or 10 as being the earnings calculated:-

(a) where the employer employs, in similar employment, other persons of similar earning capacity to the employee, as the earnings that, if the accident had not occurred, the employee would have received at the end of a 12-month period after the date of the accident in accordance with the average rate of increase in respect of the earnings of other persons of similar earning capacity employed by the employer in similar employment;

(b) where the employer does not employ, in similar employment, other persons of similar earning capacity to the employee, as the monthly earnings of the employee computed under subsection (1) or (2) and adjusted in accordance with the rate of increase in the Consumer Price Index at the end of a 12-month period after the date of the accident.

(1B) Where an employee suffers temporary incapacity after an accident and such incapacity extends beyond 24 months or such further period as the court may have allowed under section 10(5) the monthly earnings of an employee at the time of the accident shall, in respect of temporary incapacity beyond the 24-month period or beyond such further period after the date of the accident, be computed for the purposes of section 6, 7, 9 or 10 as being the earnings calculated:-

(a) where the employer employs, in similar employment, other persons of similar earning capacity to the employee, as the earnings that, if the accident had not occurred, the employee would have received at the end of a 24-month period after the date of the accident in accordance with the average rate of increase in respect of the earnings of other persons of similar earning capacity employed by the employer in similar employment;

(b) where the employer does not employ, in similar employment, other persons of similar earning capacity to the employee, as the monthly earnings of the employee computed under subsection (1) or (2) and adjusted in accordance with the rate of increase in the Consumer Price Index at the end of a 24-month period after the date of the accident.”

77. According to Miss Wong’s submission, annual adjustment should be made to the applicant’s monthly earnings by reference to the rate of increase of the Consumer Price Index at two points of time - first, at the end of the 12-month period after the accident.  The next point of adjustment is at the end of the 24-month period after the accident.

78. According to section 11(1C), the Consumer Price Index means the ‘consumer price index as complied and published as CPI(A) in a Consumer Price Index Report by the Commissioner for Census and Statistics.

79. Miss Wong managed to produce such relevant CPI(A) index for my consideration at the trial hearing.  As can be seen from table 1.1 for ‘Movements of the Consumer Price Indices in 2011’ published by the Census and Statistics Department (“the C&S Department”) as produced, the rate of increase in CPI(A) for the month of October 2011 (as compared with the October 2010)[23] is 5.2%.  From a similar table for year 2012, the corresponding rate of increase in CPI(A) for the month of October 2012 (as compared with the October of the preceding year) is 4.3%.

80. As such, if section 11(1A)(b) and section 11(1B)(b) are applicable in this case, the applicant’s monthly earnings at the time of accident can be adjusted upwards in accordance to these two sections as follows:-

(1)   The applicant’s adjusted monthly earnings at the end of the 12- month period after the date of accident would be:-

$20,000 x (100% + 5.2%) = $21,040

(2)   The adjusted monthly earnings at the end of the 24-month period after the date of accident would be:-

$21,040 x (100% + 4.3%) = $21,944.72

81. Miss Wong asked the Court to adopt the monthly earnings of $20,000, and the adjusted monthly earnings of $21,400 and $21,944.72 as the relevant base figures for calculating the applicant’s entitled compensation under section 10 for the 1^st, 2^nd and 3^rd years respectively.

82. When it comes to the calculation of the section 9 compensation, she invited the court to adopt the figure of $21,944.72 instead of $20,000 or $21,400 as the multiplicand, which is subject to the relevant statutory maximum of $21,500 as specified in the Sixth Schedule to the Ordinance. 

The construction of section 11(1A)(b) and section 11(1B)(b)

83. Whether section 11(1A)(b) and section 11(1B)(b) are applicable here so that the applicant’s monthly earnings at the time of accident can be so adjusted for claiming his compensation under sections 9 and 10?  Miss Wong cannot produce any previous authority touching upon the construction on section 11(1A) or section 11(1B).  But I think the answer is ‘yes’ for the following reasons.

84. When section 11(1A) and section 11(1B) are read together under the broader context of the entire section 11 and bearing in mind the underlying purposes of the Ordinance, one would have no difficulty to appreciate that their genesis was to enhance the interest of those injured employees who need to go through lengthy period of sick leave.

85. It is just common sense that the purchasing power of money is subject to change, and the monetary worth of the statutory compensation as meant to the injured employees can be significantly reduced over the passage of time, especially in the high inflation era or periods.

86. As I see it, the statutory protection under section 11(1A) and section 11(1B) as conferred upon the relevant injured employees to counter the depreciation in monetary worth of the compensation is two-tiered. 

87. The primary tier would allow the relevant injured employee’s monthly earnings at the time of accident be adjusted upwards by making reference to the average rate(s) of increase of the post accident earnings of comparable workers employed by his or her employer at the relevant point(s) of time stipulated in section 11(1A)(a) and/or section 11(1B)(a).  The fallback tier is that - in the absence of data for such comparable workers’ earnings for making any adjustment as aforesaid, such injured employee can still seek for the upward adjustment by referring the assessor to the rate(s) of increase in the Consumer Price Index at the relevant point(s) of time stipulated in section 11(1A)(b) and/or section 11(1B)(b).

88. With the aforesaid statutory purpose in mind and upon the reasonable construction of section 11(1A) and section 11(1B), I am of the view that:-

(1)   The triggering event for invoking section 11(1A) is where the relevant injured employee suffers temporary incapacity after an accident and such incapacity extends beyond 12 months after the accident, and there exists such average rate of increase or rate of increase at the relevant point of time as stipulated under section 11(1A)(a) or section 11(1A)(b)[24].

(2)   As for the corresponding triggering event for section 11(1B), it happens when such incapacity extends beyond 24 months after the date of accident or such further period as the court may have allowed under section 10(5), and there exists such average rate of increase or rate of increase at the relevant point of time as stipulated under section 11(1B)(a) or section 11(1B)(b)[25].

(3)   The monthly earnings of the injured employee may be adjusted upwards for the purpose of not only calculating the section 10 compensation, but also for the purpose of calculating the compensation under sections 6, 7 and 9 (as the case may be).

89. Obviously, the triggering events do have their own purpose and function to serve since the statutory adjustment as contemplated is not meant to be universal.  Of course, I do not propose to provide a comprehensive demarcation for the applicability or non-applicability of section 11(1A) and 11(1B) for every conceivable scenario in this decision.  It is not necessary for me to do so.

90. On the other hand, I feel obliged to say a few more words to explain how to work out the applicability of section 11(1A)(b) and section 11(1B)(b) to calculate section 10 compensation under certain defined scenarios and why I think section 11(1A) and section 11(1B) are applicable for computing compensation under sections 6, 7 and 9 on top of section 10.  For, the statutory wordings in these aspects appear to be terse or compact.

Some observation on the applicability of section 11(1A)(b) and section 11(1B)(b) for calculating section 10 compensation

91. First of all, it is clear that for cases where the sick leave period in question not only extends beyond the initial 12 months after the accident, but also actually beyond 24 months after the date of accident or such further period as the court may have allowed under section 10(5) (and the applicant’s case here is one example), both section 11(1A)(b) and section 11(1B)(b) can potentially be invoked for calculating the section 10 compensation.

92. In such kind of situation, logically speaking, there are 9 possible combinations of scenarios which the court may potentially face with when being asked to consider the issue of statutory annual adjustment for section 10 compensation by making reference to section 11(1A)(b) and section 11(1B)(b)[26]:-

(1)   Rate of increase in CPI(A) is found at the ends of both the 12-month period after the date of accident and the 24-month period after the date of accident.  (“Case 1”)

(2)   Rate of increase in CPI(A) is found at the end of the 12-month period after the date of accident but rate of decrease at the end of the 24-month period after the date of accident.  (“Case 2”)

(3)   Rate of increase in CPI(A) is found at end of the 12-month period after the date of accident, but no change in CPI(A) at the end of the 24-month period after the date of accident.  (“Case 3”)

(4)   There is no change of rate in CPI(A) at the end of the 12-month period after the date of accident but rate of increase is found at the end of the 24-month period after the date of accident.  (“Case 4”)

(5)   There is no change of rate in CPI(A) at the end of the 12-month period after the date of accident but rate of decrease is found at the end of the 24-month period after the date of accident.  (“Case 5”)

(6)   There is no change of rate in CPI(A) at the ends of both the 12-month period after the date of accident and the 24-month period after the date of accident.  (“Case 6”)

(7)   Rate of decrease in CPI(A) is found at the end of the 12-month period after the date of accident but rate of increase at the end of the 24-month period after the date of accident.  (“Case 7”)

(8)   Rate of decrease in CPI(A) is found at the ends of both the 12-month period after the date of accident and the 24-month period after the date of accident.  (“Case 8”)

(9)   Rate of decrease in CPI(A) is found at end of the 12-month period after the date of accident, but no change in CPI(A) at the end of the 24-month period after the date of accident.  (“Case 9”)

93. I want to emphasize that when I said ‘rate of increase’, ‘rate of decrease’ or ‘no change of rate’ in CPI(A) at a certain point of time in the preceding Paragraph 92, I was saying so by comparing the CPI(A) at the end of the 12-month period after the date of accident or the 24-month period after the date of accident (as the case may be) with the CPI(A) at the date of accident.  I will revisit this point in appropriate place below after explaining why in my view, ‘rate of decrease’ in CPI(A) should not apply under the subject statutory mechanism of adjustment to the monthly earnings.

94. Among the above 9 Cases, Case 1 is exactly the current scenario the applicant is facing with, and this is also the only type of scenario where both section 11(1A)(b) and section 11(1B)(b) would be invoked at the same time for calculating section 10 compensation.

95. As for Cases 2, 3, 4 and 7, it is notable that either section 11(1A)(b) or section 11(1B)(b) but not both would be applied to calculate the section 10 compensation, whereas in the remaining Cases 5, 6, 8, and 9, none of section 11(1A)(b) and 11(1B)(b) would need to be invoked to make any adjustment to the monthly earnings.

96. The above observation is based on my view that section 11(1A) and section 11(1B) only serve as a statutory mechanism for making upward adjustment but not downward adjustment of the relevant employee’s monthly earnings for the purpose of calculating compensation under section 6, 7, 9 or 10 (as the case may be).

97. According to the statutory wordings of section 11(1A) and section 11(1B), only the relevant average rate(s) of increase of any comparable workers’ earnings or relevant rate(s) of increase in CPI(A) would need to be taken into account by the court when considering the subject issue of statutory adjustment.  No corresponding average rate(s) of decrease or rate(s) of decrease are mentioned in either section 11(1A) or section 11(1B). 

98. In other words, when the court actually finds ‘rate of decrease’ or ‘no change of rate’ in the CPI(A) at the relevant point(s) of time, there would exist no triggering event at all to invoke the application of section 11(1A) or section 11(1B).  Hence, it is out of question that section 11(1A) or section 11(1B) can somehow be relied on for making any kind of downward adjustment to the monthly earnings.  Neither am I aware of any other places in the statute which permit any downward adjustment of the monthly earnings by referring to the post accident earnings of the comparable workers at a lesser rate or to any rate of decrease in consumer price index.

99. Speaking about the statutory intent, aside sections 11(1A) and 11(1B), the protections conferred upon the injured employees under the current statutory fabrics are further manifested in different other aspects.  It suffices for me just to name a few examples here. Within section 11 itself, its subsection (1) provides two options for calculating the monthly earnings and the relevant employee can choose whichever one that is more favourable to him or her. 

100. Outside section 11, section 10(4) and section 10(5) (which Rogers VP expounded their purposes behind in Choy Wai Chung (supra)) are the other facets of statutory protection flowing out of the same concern over the financial position of those vulnerable employees on prolonged sick leave.  (See: Paragraphs 65 and 66 above)

101. The irrebuttable presumptive effect of the deeming provision under section 10(2) as carefully reviewed by Deputy District Judge Anthony Chow in Sin Fu Yau (supra) is another statutory measure in echo with the overall statutory theme in affording needy protection to the injured employees in speedy manner and with considerable certainty. 

102. In LKK Trans Ltd v Wong Hoi Chung(2006) 9 HKCFAR 103, Mr. Justice Bokhary PJ at para 5 said:-

“… But the obvious object of the Employees’ Compensation Ordinance is speedily and with considerable certainty to provide urgently needed no-fault and compulsorily-insured compensation to injured employees or the families they leave behind. And that is not a context in which I see any warrant for resorting to that sort of reading down in order to permit apportionment and thus introduce the delay and uncertainty which apportionment would generally entail…”

103. As mentioned above, the statutory purpose of sections 11(1A) and 11(1B) are directed to enhancing the interests of those injured employees on prolonged sick leave.  The accidents would very often render the positions of many of such employees very vulnerable by incapacitating them from making any earnings to support himself and/or his family members during the lengthy sick leave period while at the same time creating additional financial burden upon their shoulders to discharge the substantial medical expenses.

104. Given the above perspective, I do not think the Legislature would intend any rate of decrease in CPI(A) to be applied by the assessor to make any downward adjustment to the monthly earnings of the relevant employee when section 11(1A) or section 11(1B) is to be invoked for calculating the relevant compensation in scenarios like Cases 2, 5, 7, 8 and 9.  My observation here should also apply mutatis mutandis to any situation involving section 11(1A)(a) or section 11(1B)(a).  As such, any average rate(s) of decrease in the post accident earnings of the comparable workers as may be found at the relevant points of time stipulated in the section 11(1A)(a) and section 11(1B)(b) should similarly be disregarded.

105. If it were the otherwise, not only would the very purpose of affording the statutory protection to those vulnerable employees be significantly hampered, such employees when faced with scenarios like Cases 5, 8 and 9 would even receive lesser compensation (due to the downward adjustment of their monthly earnings) as compared with their corresponding positions before the introduction of section 11(1A) and section 11(1B) assuming every other condition being equal.

106. In Man Sun Chuen v Chan Siu Kin t/a Kin Fai Construction Company & Anor (unrep, DCEC 540 of 2001), His Honour Judge Carlson dealt with an extension application under section 10(5), the respondents’ solicitor tried to argue that the applicant should receive his periodical payment during the second 12-month period and third 12-month period after the accident under section 10 at a lesser monthly earnings by producing some evidence of the post accident earnings of some comparable workers who worked for lesser workdays each month and paid at a reduced pay rate.  After citing sections 11(1), (1A) and (1B) in full in the earlier part of his judgment, the learned Judge at para 10 said,

“And I have already indicated what I have in mind is that if the applicant produces medical certificates certifying his unfitness to work up to the third anniversary, then the payments will be at that rate. It is quite clear from section 11 that the section operates in a way that is favourable to the employee, the workman, so that if the rates go up, then they will go up in accordance with the comparables, but the employer if […] bound to pay at the original rate. There may well be evidence here that the rates have gone down, but equally, in any event, the applicant has put in evidence to suggest that the rates in fact have not gone down, but under section 11 it seems to me that the applicant is entitled to be paid at the rate that has already been established, so that is my order.”

107. As illustrated by the above passage, the learned Judge was also of the view that section 11 operates in a way that is favourable to the workman, and under such section the applicant is entitled to be paid at the pre-accident rate notwithstanding evidence showing that there were comparable workers receiving their monthly earnings at a lesser rate post accident.  Having said that, I observe that some words appear to be missing in the middle of the passage (as underlined above), and I suspect that was due to an inadvertent mistake made by the transcriber while typing out the transcript for the printed judgment.  Nonetheless, the learned Judge’s view on section 11(1A)(a) and section 11(1B)(a) should be clear to the reader if his judgment is read as a whole and in context.  The relevant proposition that can be elicited from the judgment is this - under section 11, if the pay rates of the relevant comparable workers go up, the applicant’s pay rates for the purpose of calculating section 10 compensation will go up in accordance with the comparables, but the employer, if the pay rates go down, would still be bound to pay the applicant at the original rate (i.e. at the pre-accident rate).  In any event, that would be how I construe the statutory effect of section 11(1A)(a) and section 11(1B)(a) on the calculation of section 10 compensation in situations like Man Sun Chuen (supra).

108. I now return to the question of reference point as mentioned in Paragraph 93 above.

109. Practically speaking, making the date of accident as the reference point for the purpose of considering whether there exists any change of rate in CPI(A), and if so, the status of change (increase, decrease or no change) may not appear significant if the assessor is to consider the position at the end of the 12-month period after the date of accident as specified in section 11(1A)(b) (“the former case”) because the reference point in such a case would naturally be the date of accident. 

110. But when the assessor comes to consider the position at the end of the 24-month period after the date of accident as specified in section 11(1B)(b) (“the latter case”), there are two logically possible reference points – one is the date of accident, and the other is at the end of the 12-month period after the date of accident.  In such a case, I think the assessor should still take the date of accident as the reference point for the following reasons:-

(1)   It is theoretically possible that at the end of the 12-month period after the date of accident, there may be found a rate of decrease in CPI(A), say -5%, as compared with the date of accident, but after a passage of 12 more months, the rate of CPI(A) may have changed in such a way so that at the end of the 24-month period after the date of accident, a rate of increase of, say, +1%, is observed as compared with the CPI(A) at the end of the 12-month period after the date of accident. 

(2)   Even so, the resultant status of change in rate of CPI(A) at the end of such 24-month period after the date of accident would still be a rate of decrease as compared with the CPI(A) at the date of accident. In other words, if section 11(1B)(b) were to be so construed by taking the CPI(A) at the end of the 12-month period after the date of accident (instead of at the date of accident) as the reference point, the court would in such a case be compelled to adjust the relevant employee’s monthly earnings downwards and calculate his compensation accordingly.

(3)   However, the monthly earnings of the injured employees should not be adjusted downwards by virtue of section 11(1A) or section 11(1B) for calculating his compensations under the Ordinance due to reasons as explained above.  Hence, the logical and reasonable consequence is that the date of accident should likewise be adopted as the reference point in the latter case.

Sections 11(1A) and 11(1B) are applicable in calculating the compensation under section 6, 7 or 9 (as the case may be) on top of section 10

111. As said, I consider that the statutory adjustment to the monthly earnings of the relevant employee made under section 11(1A) or section 11(1B) can be applied for the purposes of calculating the compensation under section 6, 7 or 9 (as the case may be) on top of section 10.  If this is not so, the phrase ‘for the purposes of section 6, 7, 9 or 10’ as appeared in these two statutory provisions would become otiose.

112. However, when it comes to the calculation of compensation under section 6, 7 or 9 where the sick leave period not only extends beyond 12 months after the date of accident but also actually beyond 24 months after the date of accident or such further period as the court may have allowed under section 10(5), unlike the section 10 situation, only either one of section 11(1A)(b) or section 11(1B)(b) but not both would apply irrespective of any circumstances.  This is because, as a matter of principle, there can be only one multiplicand to serve as the relevant employee’s adjusted monthly earning for calculating his or her compensation under section 6, 7 or 9 (as the case may be).

113. After giving careful consideration to the various types of scenarios set out in Paragraph 92 above and their potential implications, I am of the view that section 11(1A)(b) and section 11(1B)(b) can be reasonably construed to work out the statutory effect as mentioned in the preceding paragraph:-

(1)   If section 11(1A)(b) or section 11(1B)(b) is to be invoked at all for the purpose of calculating the compensation under section 6, 7 or 9 (as the case may be), it would also be confined to Cases 1, 2, 3, 4 and 7[27]. When any scenario like Case 2, 3, 4 or 7 happens, there would be no question of both section 11(1A)(b) and section 11(1B)(b) being invoked at the same time, but only either section 11(1A)(b) (as in Cases 2 and 3) or section 11(1B)(b) (as in Cases 4 and 7) would apply for reason as explained above.

(2)   In Case 1 and where any relevant employee suffers such length of sick leave period as mentioned in Paragraph 112 above (and the applicant’s case here is one example), his period of temporary incapacity can be caught by the wordings of both section 11(1A)[28] and section 11(1B)[29].  In my view, the provisions are so drafted to make it possible for the monthly earnings of the relevant employee (such as the applicant in this case) to be adjusted twice for the purpose of calculating the compensation under section 10 - the first time at the end of the 12-month period after the date of accident, and the second time at the end of the 24-month period after the date of accident.  On the other hand, the statutory provisions being drafted in such manner would also technically create two apparent options for the assessor to choose from in calculating the compensation under section 9 (as in this case)[30]. 

(3)   To resolve this point, I think one should approach these two statutory provisions by construing them together and according to their statutory purposes.  Bearing this in mind, I think as a matter of statutory construction, it would only be sensible under Case 1 (in a situation like the present case where the rate of increase in CPI(A) at the end of the 24-month period after the date of accident is greater than that at the end of the 12-month period after the date of accident) to apply section 11(1B)(b) rather than 11(1A)(b) to calculate the compensation under section 6, 7 or 9 (as the case may be). 

(4)   First, under such a context as referred to in sub-paragraphs (2) and (3) above, the triggering event for section 11(1A)(b) would naturally come before the triggering event for section 11(1B)(b).  Viewing from the chronological sequence, the former should be subsumed under the latter for the purpose of calculating the compensation under section 6, 7 or 9 (as the case may be).  Second and more importantly, if it were the otherwise, the provision of section 11(1B)(b) would become useless for the purpose of calculating the compensation under section 6, 7 or 9 (as the case may be) under the aforesaid context and yet, one obvious purpose of introducing section 11(1B)(b) (in addition to section 11(1A)(b)) is to better shield the injured employees from effect of inflation in its rising trend, which can significantly erode the monetary worth of their compensation especially in high inflation era such as that as experienced by Hong Kong in late 80s to the mid 90s.  As a matter of fact, the Legislature amended section 11 of the Ordinance by introducing the new section 11(1A) and section 11(1B) in 1995.

114. In light of the aforesaid, one can see that section 11(1A) and section 11(1B) are drafted in such a condensed manner so as to allow all potential scenarios of many different combinations to be dealt under two statutory provisions only.  But when it comes to the actual individual application, it would depend on which particular scenario the assessor is facing with and whether the actual need to apply only one of these two provisions or both would arise.

Application of subsection 11(1A)(b) and 11(1B)(b) in this case

115. I have already exercised my discretion under section 10(5) and allowed the Applicant to claim for his section 10 compensation up to a full 36-month period after the date of accident.  Further, he was able to produce evidence showing the relevant rates of increase in CPI(A) at the ends of the 12-month period and of the 24-month period after the date of accident.  Therefore, it is prima facie permissible for him to invoke section 11(1A)(b) and section 11(1B)(b) to adjust his monthly earnings at $21,040 in calculating his section 10 compensation for the second 12-month period, and at $21,944.72 for the third 12-month period.  Further, he can rely on section 11(1B)(b) to adopt the adjusted monthly earnings of $21,944.72 (subject to the relevant statutory maximum of $21,500) as the multiplicand to calculate his section 9 compensation.

116. Strictly speaking, according to the statutory wordings of section 11(1A)(b) and section 11(1B)(b), in order for the applicant to invoke their application, he also needs to demonstrate to the court that the respondent had not employ any such comparable workers as referred to in section 11(1A)(a) and section 11(1B)(a) at the relevant periods of time. However, in this particular case, I observe that firstly, the respondent did not appear at the trial hearing to contest the applicant’s claims basing upon his monthly earnings as statutorily adjusted.  Secondly, there is no evidence before me showing that the respondent had employed any such comparable workers at the relevant periods of time, not to mention any evidence related to the post accident monthly earnings of such comparable workers if they were so employed at all.

117. In these circumstances and by reason of the foregoing analysis, I am satisfied the applicant can apply section 11(1A)(b) and section 11(1B)(b) in this case to make the corresponding statutory adjustments to his monthly earnings at the time of accident for calculating his compensations under both sections 9 and 10. 

Calculation of the compensation under section 9 and section 10

118. The applicant was 51 years old at the time of accident, and according to my ruling, he is entitled to adopt the adjusted monthly earnings at $21,744.72 (which is subject to the statutory maximum of $21,500 applicable at the time of accident) to calculate his section 9 compensation.  I have assessed the subject loss of earning at 17%.  (See: Paragraph 55 above)

119. In light of the aforesaid, compensation as entitled by the applicant under section 9 would be:-

$21,500 x 72[31] x 17% = $263,160

120. His entitled section 10 compensation would accordingly be:-

(1) In respect of the 1st year:-[32]
$20,000 x 4/5 x 343/30	$182,933
(2) In respect of the 2nd year:-[33]
$21,040 x 4/5 x 12	$201,984
(3) In respect of the 3rd year:-[34]
$21,944.72 x 4/5 x 12	$210,669
Total:	$595,586
	=======

Section 10A compensation

121. At the trial hearing, Miss Wong has gone through with this Court in details on the voluminous supporting medical receipts and other contemporaneous statement of accounts issued by the relevant hospitals and clinics.  She also made it clear that for the purpose of this action her client would not claim for any medical expenses incurred beyond 12 October 2013, ie outside the 3-year period after the accident.  At the last part of her closing submission, she submitted a revised summary of the medical expenses as claimed by her client, the breakdown of which is as follows:-

(1) QMH	$1,620
(2) PMH	$200
(3) DTRC	$7,920
(4) WKPC / Kwai Chung Hospital	$1,530
(5) Tung Chung General Outpatient Clinic	$1,232
(6) Registered Chinese Medicine Practitioner (江文光中醫)	$2,080
Total:	$14,582
	======

122. I find the above medical expenses well documented by such contemporaneous receipts or statement of accounts as contained in the trial bundles, and I accept the aforesaid figures.  On top of that, I also find medical receipts[35] issued by the WKPC / Kwai Chung Hospital during the period between 29 January 2013 and 17 September 2013 in the total sum of $640 not yet included in the above revised summary of medical expenses.  Miss Wong confirmed that they should also be included in the Applicant’s claim under section 10A.  On balance of probabilities, I am also satisfied that such amount of $640 was medical expenses incurred by the Applicant as a result of the injury he sustained in the accident.

123. In these circumstances, I allow a total sum of $15,222 (ie $14,582 + $640) as the relevant medical expenses under section 10A in this case.

Summary

124. To summarize, the compensation I award to the Applicant is as follows:-

(1) Section 9 compensation	$263,160
(2) Section 10 compensation	$595,586
(3) Section 10A compensation	$15,222
Total:	$873,968
	=======

125. The respondent has not made any advanced payment to the applicant in this case.  Interest shall accrue on the said sum of $873,968 at half judgment rate from the date of accident (ie 13 October 2010) until this judgment and thereafter at judgment rate until payment in full.

Conclusion

126. In the premises, I order the respondent to pay the compensation assessed at the sum of $873,968 together with interest as aforesaid to the applicant. 

127. Also, I make a costs order nisi that the respondent do pay the applicant the costs of this action, to be taxed if not agreed.  The costs order nisi shall become absolute in the absence of application to vary the same within the next 14 days.  The applicant’s own costs to be taxed in accordance with Legal Aid Regulations.