MR RAVI GIDUMAL AND OTHERS v. DR RICHARD WING CHIU AND ANOTHER

HCPI 411/2012

[2019] HKCFI 228

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO 411 OF 2012

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D E C I S I O N

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1.  The 2^nd plaintiff (“P2”) and 3^rd plaintiff (“P3”) (collectively, “Ps”) were the parents of Zubin Mahtani Gidumal (“Zubin”). Zubin was 3 years old when he passed away on 31 May 2009 from pneumococcal meningitis. In the present action, the estate of Zubin (“P1”), P2 and P3 sue the 1^st defendant (“D1”) and 2^nd defendant (“D2”) (collectively, “Ds”) for damages in respect of their alleged medical negligence in failing to properly diagnose and treat Zubin’s condition, P1 and Ds have since reached settlement in respect of P1’s claims against Ds, and the outstanding proceedings concern Ps’ claims against Ds.

2.  In Ps’ Revised Statements of Damages filed on 16 April 2014 (“RSoD”), P2 claims for inter alia actual/expected loss of income, future loss of income and loss of congenial employment, and P2 claims for loss of expected income, future loss of income and loss of congenial employment.

3.  On 16 February 2015, Ps’ forensic accounting expert Brian Silvia (“Silvia”) rendered forensic accounting (quantum) expert report for P2 and P3 on calculation of their pre-trial and post-trial loss of income (“Silvia Report”). On 27 July 2016, Ds’ forensic accounting expert John Mitchell (“Mitchell”) rendered corresponding forensic accounting (quantum) expert report (“Mitchell Report”). For convenience, Silvia and Mitchell are collectively referred to as “Experts” below.

4.  By my order dated 28 February 2017 (“Order”), I granted inter alia the following case management directions:

(a)   Ps and Ds shall jointly instruct the Experts to produce a joint expert report on quantum (forensic accounting) for the court, and such instructions are to be served on the Experts within 21 days of completion and availability to Ps and Ds of the supplemental joint psychiatric reports by Professor Michael Trimble (“Prof Trimble”) for Ps and Dr Josephine Wong (“Dr Wong”) for Ds (collectively, “Psychiatric Experts”);

(b)   the joint instructions for the joint expert report on quantum (forensic accounting) shall identify for the Experts “all potential scenarios that [Ps] and [Ds] may contend in relation to [Ps’] past and prospective work capacity”;

(c)   Silvia for Ps and Mitchell for Ds shall compile a joint report on quantum (forensic accounting) for the court within 35 days of receipt of the instructions referred to in (b) above;

(d)   in the joint report by the Experts, they shall have regard to paragraphs 86-87 of Practice Direction 18.1 and shall state (i) all the issues upon which they have reached a common opinion, (ii) all the issues upon which they have failed to reach a common opinion, (iii) their competing views on each and every issue, and (iv) their reasons for their disagreement with the opposing views; and

(e)   Ps have leave to amend their RSoD and shall file and serve their Amended RSoD (if any) within 28 days of completion and availability to Ps and Ds of the joint expert report on quantum (forensic accounting).

5.  On 17 April 2013, Prof Trimble gave psychiatric expert reports on quantum on P2 and P3. On 23 March 2014, Dr Wong gave psychiatric expert reports on quantum on P2 and P3. On 9 September 2015 and 8 May 2018, the Psychiatric Experts gave their initial and supplemental joint psychiatric expert reports on quantum on P2 and P3.

6.  P2’s 1^st, 2^nd and 3^rd witness statements were dated 15 October 2012, 15 May 2013 and 13 February 2014 respectively. P3’s witness statements were dated 14 October 2012 and 13 February 2014 respectively.

7.  By the Order, I have granted leave for Ps to serve additional witness statements as to fact from P2 and P3 to provide an update on their personal and professional situations (including their psychiatric conditions and treatment) within 28 days from the date of the Order. Pursuant to such directions, Ps served P2’s 4^th witness statement and P3’s 3^rd witness statement both dated 11 April 2017.

8.  The above account shows that the RSoD was filed before the initial and supplemental joint psychiatric expert reports by the Psychiatric Experts, the Silvia Report, the Mitchell Report, the joint expert report on quantum (forensic accounting) which has yet to be prepared, P2’s 4^th witness statement, and P3’s 3^rd witness statement.

9.  On 11 October 2018, Ps and Ds jointly wrote to inform this court they were unable to reach agreement on the joint instructions to be sent to the Experts for preparation of their joint expert report on quantum (forensic accounting), and enclosed a bundle of inter-solicitors’ correspondence asking for paper disposal of their dispute by the court.

10.  Time and again, this court has made clear it is inappropriate for parties to ask the court to review inter partes correspondence and then try and ascertain on a do-it-yourself basis what the parties’ differences are, especially when the court is asked to go on to resolve the dispute by paper disposal without the benefit of oral submissions.[1]

11.  On 29 October 2018, this court directed Ps to lodge draft joint instructions to the Experts with parts disputed by the parties marked up in different colours, a concise bundle of documents in respect of the joint application, and hard/soft copies of the parties’ respective submissions.

12.  Thereafter, the parties asked for several time extensions to comply with my directions dated 29 October 2018. On 12 December 2018, the parties lodged (a) a bundle of relevant documents, (b) a marked-up draft joint instructions to the Experts (“Draft”), and (c) the parties’ respective written submissions.

13.  Since Ps and Ds are well familiar with RSoD, expert reports, witness statements and the Draft, I do not propose to set out the background for the purpose of resolving the case management question placed before this court. Save for a few preliminary matters in paragraphs 14-15 below, I turn directly to the matters in dispute over the Draft.

14.  In the parties’ written submissions, there is reference as to what fell from this court at the hearing that resulted in the Order. However, much has happened since the granting of the Order in early 2017, including further expert reports, discovery and witness statements. I now also have the assistance of the parties’ written submissions that have taken into account these further matters. In the circumstances, I shall approach the disputes over the scope and content of the joint instructions for the Experts without the straightjacket of earlier views (if any) expressed in the then context.

15.  Further, I will deal with the parties’ disputes over the scope and content of the Draft in this Decision, but it is for the parties to re-work and finalise the joint instructions for the Experts to prepare their joint expert report on quantum (forensic accounting) pursuant to the guidance and limits set out in the Decision.

16.  From the written submissions, Ps suggest there are 5 areas of dispute and Ds suggest there are 2 areas. I turn to each of them.

17.  On the first and second points of contention in relation to the supplemental joint psychiatric report and alternative work capacity scenarios, the parties disagree over (a) the extent to which the proposed joint instructions to the Experts should refer to the supplemental joint psychiatric expert report, and (b) whether alternative work capacity scenarios should be identified for the Experts. These two disputes are inter-related, so it is useful to deal with them together.

18.  By the Order I directed that the joint instructions for the Experts should set out “all potential scenarios that [Ps] and [Ds] may contend in relation to [Ps’] past and prospective work capacity” (see paragraph 4(b) above). Whilst it must be correct that findings of fact are for the court and not for the Experts, the Experts cannot and should not express their opinion in vacuo. To properly assist the court, the Experts should have regard to the factual assumptions on which they rest their opinion. Eventually, it will be for the respective parties to adduce evidence to prove the relevant factual assumptions at trial in order to give evidential foundation for the relevant expert opinion, failing which the opinion may become unsustainable.

19.  Turning to the Silvia Report in relation to P2, it has been assumed that (a) if P2 had continued with his full-time position at Gidumal and Sons Limited (“GSL”) then Mr Kanji would not have been hired (paragraph 62 of the report), and (b) the level of P2’s involvement in GSL would remain the same as it was following Zubin’s death and at the time of the Silvia Report (ie Silvia has not factored any adjustment to reflect the involvement of P2 in GSL (if any) beyond that as then claimed) (see paragraph 65.1 of the report). The Mitchell Report notes a further assumption by Silvia, ie (c) Mr Kanji’s employment does not result in GSL’s business performing any better than if he had not been employed (see paragraph 3.2.4 of the report).

20.  Turning to the Mitchell Report in relation to P2, Mitchell observes that Silvia’s factual assumption that P2 will not work at all in GSL after the trial date until his retirement does not reflect the “the current reality based on the joint psychiatric expert report on [P2] dated 9 September 2015 and, therefore, may not be the only potential outcome. [Mitchell has] therefore considered a range of loss of income based on different levels of involvement of [P2] in GSL”. Mitchell considers “[it] may be more appropriate to assume that [P2] will continue to work in GSL, until [P2] retires. With the possibility of [P2] deriving income during the post-trial period by either working at GSL or generating income from other sources, [Mitchell believes] it is appropriate to consider a number of scenarios which take into account a range of levels of his involvement during the period after the Hypothetical Date of Trial. ……” (see paragraphs 3.2.10.4, 4.6.1-4.6.2 and 5.8.1-5.8.5 of the report). Mitchell takes into account the joint psychiatric expert report dated 9 September 2015 (unavailable to Silvia at the time of the Silvia Report) that P2 was then working 4 days a week from 11:00am to 5:30pm with potential to increase his hours of work in the coming 2-3 years if he continues to improve with treatment (see paragraph 5.8.3 of the report).

21.  It is plain from the above that both Silvia and Mitchell rely on factual assumptions as to P2’s ability to work in their solo reports, and both recognise that it is for parties to prove the relevant factual assumptions at trial and for the court to make findings of fact. What is important at this stage of preparing expert reports on quantum is to ensure that the range of factual assumptions as to P2’s ability to work is placed before the Experts for their consideration. This does not mean such factual assumptions are therefore equivalent to findings of fact.

22.  That said, it is not for the Experts as forensic accounting experts to go through the psychiatric expert reports to make out the range of factual assumptions that will form different factual premises for their opinion. Rather, it is for the parties to distill from the available evidence (whether factual evidence according to witness statements and discovered documents and/or opinion evidence according to, say, psychiatric expert reports) the factual assumptions they wish to put forward, and inform the Experts of their respective contentions as to P2’s work capacity (premised on the available evidence but yet to be proved at trial). For example, although the Silvia Report is premised on P2 being unable to manage GSL after Zubin’s death and having to hire Mr Kanji to take over his role, P2 has put forward alternative scenarios of his work ability in the blue section of paragraph 1.2(A1)(i)-(iii) of the Draft that envisaged some work done by P2 for GSL, but at the end of the day the court may well find for one or none of those scenarios.

23.  However, whilst the alternative factual scenarios are relevant as part of the instructions to the Experts, it is for the Experts to tell the court by way of their joint report to be prepared whether (a) there is any professional forensic accounting methodology to translate the factual assumptions to quantification of loss, (b) if yes, what is the methodology and why it is appropriate, and (c) if not, what approach should be adopted within the limits of their forensic accounting expertise to assist the court pending findings of fact at trial.

24.  In the Mitchell Report, Mitchell has approached the factual assumption of P2 being able to return to some form of work at GSL after the Zubin’s death until after his retirement for the purpose of calculating P2’s pre-trial and post-trial loss of income by way of charts that show a percentage on yearly basis. In short, Mitchell essentially ignores the factual assumption altogether (presumably on the basis that this is outside his expertise), and leaves it to the court to factually work out P2’s contribution to GSL and then apply the percentage tables. This is also evident from paragraph 17 of the written submissions of Mr McLeish, counsel for Ds.

25.  It is unclear at this stage how Silvia will approach the factual assumption as to P’s ability to work. As alluded to above, the Silvia Report is premised on P2 being unable to manage GSL after Zubin’s death and having to hire Mr Kanji to take over his role. But the factual assumptions for the Experts now proposed by P2 envisage some work being done by P2 for GSL. It is unknown how Silvia will approach assessment of loss of income on a partial basis. Will Silvia adopt Mitchell’s approach or will he adopt a different methodology? If the different factual scenarios/assumptions are put to Silvia, will he as an expert in forensic accounting be in a position to (a) quantify the loss represented by such alternative factual scenarios, and (b) explain his methodology and calculations? It is for Silvia as an expert in the forensic accounting area who knows his Ikarian Reefer duties to the court to say whether there is such professional methodology within his area of expertise, so that if there is, he should explain and justify the same (and depending on Mitchell’s eventual opinion this leaves open possible challenge by Ds as to Silvia’s methodology that will underlie his calculations), and if there is not, he should say so and consider whether Mitchell’s approach or some other approach is the correct one to adopt.

26.  In my view, the appropriate approach is firstly for the parties to put forward the alternative factual scenarios which they respectively contend in the joint instructions to the Experts, which will inform the Experts of their different contentions. It is up to Ds to decide whether they wish to put forward any alternative scenario, but they are entitled to do so or not to do so. Secondly, the Experts should be asked whether they are in a position as experts in forensic accounting to quantify the loss as represented by the alternative factual scenarios. If so, they should state the methodology and the professional/expert basis for the same. If not, they should explain why. If they disagree, they should state and explain their disagreement. Thirdly, the Experts should then give their opinion on assessment of loss based on the relevant methodology, state their areas of agreement, and give a critique on the other expert’s approach in relation to their areas of disagreement.

27.  The above observations apply mutatis mutandis to P3. On such basis, the updated joint psychiatric expert reports and witness statements can also be sent to the Experts for context under joint instructions on the above bases.

28.  The third area of dispute is the start date for lost earnings. P2’s position is that the start date for calculation of his lost earnings is 1 February 2012 when Mr Kanji was hired by GSL. There does not seem to disagreement over such start date for P2’s lost earnings. The disagreement mainly concerns P3.

29.  P3 claims she became unable to manage the work at Community Business Limited (“CBL”) the day after Zubin’s death (ie 1 June 2009). But the RSoD filed on 16 April 2014 pleads that P3 started to incur loss of income from 1 January 2012.

30.  Ds’ case is that 1 January 2012 is the relevant start date for calculating P3’s loss of income to be adopted by the Experts, but Ps claim the start date should be 1 June 2009. Ds take the view that since the RSoD claims loss of income for P3 from 1 January 2012 (not 1 June 2009), it will be incorrect for the Experts to calculate her loss from 1 June 2009. As Mr McLeish puts it, “[there] is no pleaded case before the court to justify instructing the forensic accounting experts to give opinions on any alleged loss of income from 1 June 2009 to 31 December 2011”, so they should not be instructed to do so.

31.  Before considering this dispute between the parties, it is necessary to turn to the basics of usual case management in personal injury cases. The pre-action protocol under Practice Direction 18.1 envisages that with sensible cooperation between the parties, expert reports on quantum can be obtained even before the commencement of proceedings. The purpose is to expedite the litigation process for the benefit of both parties. If a complete set of expert reports on quantum is bespoken before the commencement of proceedings, those reports will inform the preparation of the Statement of Damages. Thereafter, the personal injury litigation will usually run through the process of discovery of documents and exchange of witness statements. Bearing in mind that a personal injury claim deals with physical/mental injuries and their impact on the plaintiff, the evidence will develop as the litigation progresses. Physical/mental sequelae/conditions and ability to work may stabilise, improve or deteriorate over time. It is for this reason that the plaintiff is invariably given general leave to revise the Statement of Damages, which then becomes the Revised Statement of Damages, after the factual evidence (discovered documents and witness statements) and opinion evidence (expert reports on quantum) are gathered without first submitting any draft to the court and/or the defendant for consideration. By that time the factual and opinion evidence for both parties are on the table, and it is expected the revisions in the Revised Statement of Damages will fall within the parameters of the available evidence. If the revisions fall outside such parameters, they are likely to be met with an application for striking out.

32.  The above case management approach has been a long-established practice in personal injury litigation. Thus, if discovery and statement evidence show developments that have not been pleaded in the Statement of Damages, eg improvement/deterioration in physical/ mental condition and/or cessation of work or return to work, relevant expert evidence on quantum may be obtained or supplemented on the basis of such factual matters/assumptions knowing that in due course the Statement of Damages will be revised in line with the available document/statement/opinion evidence. This has the benefit of obviating the more formal approach adopted in other civil litigation, which requires amendment of pleadings to plead the relevant case contended for before considering any need for expert evidence on the relevant amendments. But that said, such usual practice in personal injury litigation is not a licence to obtain all sorts of factual/opinion evidence that has no relevance or only marginal relevance to the plaintiff’s claim. The need to seek leave to adduce supplemental witness statements and the joint approach to obtaining expert reports are usually sufficient reminders to parties to adopt a sensible and measured approach, failing which disagreement over such matters will need to be resolved by the court. PI Masters also have oversight over the scope of the evidence at checklist review and directions hearings.

33.  Here, even though the RSoD has been filed on 16 April 2014, initial and supplemental joint supplemental psychiatric expert evidence, any forensic accounting evidence and 3^rd round of statement evidence have yet to be obtained/served at that stage, but such evidence must necessarily inform the claim for damages and any defence thereto. That is why by the Order this court granted leave for Ps to amend the RSoD and to file the Amended RSoD (if any) within 28 days of completion and availability to Ps and Ds of the joint expert report on quantum (forensic accounting) (see paragraph 4(e) above).

34.  Given the aforesaid explanation, the question at issue then becomes (a) whether on the available evidence there is any arguable basis for Ps to amend the RSoD to plead 1 June 2009 rather than 1 January 2012 as the start date of P3’s loss of earnings, and (b) if so, whether forensic accounting opinion on the assessment of P’s loss of income for the period from 1 June 2009 to 1 January 2012 should be bespoken now.

35.  The Silvia Report relies on 1 June 2009 as the start date for calculating P3’s loss of earnings, and Mitchell has followed Silvia in adopting such date as the starting point for calculation of P3’s loss of income. More importantly, according to P3’s witness statement dated 14 October 2012 as noted in the Silvia Report (paragraph 108 and 113 of the report), P3 has stepped down as the CEO after Zubin’s death (with a new CEO appointed to replace her), worked on a part-time basis from September 2009 to December 2011, and stopped working at CBL by end of 2011.

36.  There is also psychiatric expert evidence (see opinion in the initial joint psychiatric expert report dated 9 September 2015 on P3 in relation to causation) that the death of Zubin and the circumstances surrounding his death and “also in the aftermath of his death” have caused P3’s psychiatric condition, and that such condition as induced by the circumstances surrounding Zubin’s death, particularly in the time period before his death, “but also in the aftermath of his death could be defined as ‘shock’, meaning there was a ‘horrifying event’ ……”, and on such basis the Psychiatric Experts do not consider P3 will be able to return to work.

37.  In the supplemental joint psychiatric expert report dated 8 May 2018 on P3, there are detailed discussions on P3’s diagnosis and prognosis. On the issue of return to work, the Psychiatric Experts note P3 previously has worked actively in a paid position as CEO of CBL, and they go on to deal with P3’s current professional roles including that at the Zubin Foundation. Based on such roles, “the joint expert opinion is that [P3] is able to engage in networking, teaching, public speaking, press and social interaction, setting strategic direction for the different initiatives of the Zubin Foundation, but is currently not able to perform a corporate management role (which she did at [CBL] before Zubin passed away)” (see paragraph 76 of the report). The Psychiatric Experts believe P3 is entitled to maintain her current level of functioning, but they differ in their opinion on her prospect of improvement (see paragraph 78 of the report).

38.  Viewing the witness statements and psychiatric expert reports together, it appears there is arguable basis to suggest that P3 has suffered “shock” induced by the circumstances surrounding Zubin’s death and in the aftermath of Zubin’s death, which has caused her to suffer psychiatric impairment, and has affected her work function such that she has stepped down as CEO of CBL after Zubin’s death. Ultimately, whether this is so will be a matter of factual findings by the court, but there appears to be arguable basis to put forward such contention.

39.  Indeed, Mr McLeish in paragraph 13 of his written submissions acknowledges that “[it] is anticipated Ps may say that P3 has incurred alleged losses of income prior to 1 January 2012 that were for some reason or other overlooked when the RSoD was prepared and they intend to amend the RSoD to include claims for them”. In my view, with the further factual and expert evidence gathered subsequent to the filing of the RSoD that deals with the causative connection between the events in relation to Zubin’s death (including the aftermath of his death) that constitute the “shock”, there appears at least to be arguable basis for P3 to put forward such plea.

40.  Mr McLeish emphasises that Ds reserve all their rights in respect of such anticipated amendment, including (but not limited to) their right to respond in full. In my view, Ds are entitled to deny or not admit such claim as they see fit, and they can even put forward their own case based on psychiatric and/or forensic accounting evidence (if any). But the fact Ds have a right to respond does not detract from the arguability of P3’s claim of loss of earnings prior to 1 January 2012.

41.  The next consideration is whether forensic accounting expert evidence should be obtained in respect of P3’s loss of income for the period from 1 June 2009 to 31 December 2011, ie before 1 January 2012. There is already forensic accounting expert opinion on assessment of loss of income by P3 from 1 June 2009 onwards in the Silvia and Mitchell Reports, and there is no dispute between the parties that forensic accounting opinion should be adduced in relation to P3’s claim for loss of income on/after 1 January 2012. It is difficult to understand why forensic accounting expert evidence should be allowed for the period on/after 1 January 2012 and not in the period before if there is arguable basis to claim for lost earnings for the latter period.

42.  All that is submitted on behalf of Ds is that “there is no reason to assume that new claims could or should not be determined in the conventional way by reference to the factual evidence, without resort to expert opinion evidence. This is particularly so given that P3 continued to be engaged by CBL from 1 June 2009 to 31 December 2011”. I disagree. The fact that P3 has continued to be employed at CBL up until 31 December 2011 will not detract from the need for forensic accounting expert evidence. After all, she has worked on part-time basis and no longer as CEO of CBL during that period. Further, the approach adopted in the Silvia Report is based on 2 scenarios, ie (a) scenario 1 based on P3’s historic earnings prior to Zubin’s death, and (b) scenario 2 based on P3’s earning capacity as if she has continued in the role of CEO at CBL and has been paid at market rate (ie the rate of the replacement CEO recruited from the market). On the other hand, Mitchell considers the fairest basis to use is the earnings of P3 in the full year prior to the death of Zubin. As Silvia acknowledges, which scenario if at all will be adopted will be for the court. But expert assistance on the calculations and projections of earnings that will fairly represent P3’s loss of income will inform the court in its factual findings.

43.  I therefore consider the Experts should assume 2 alternative start dates for the calculation of P3’s loss of income in their joint report to be prepared, ie 1 June 2009 and 1 January 2012, and it will be up to the court to decide at trial what is the appropriate start date.

44.  The fourth point of contention is the notional year of retirement. Ps suggest the notional years of retirement of P2 and P3 should be consistent with those relied upon in the Silvia Report, which in turn is derived from the RSoD. But then the Mitchell Report adopts a range of possible notional years of retirement for P2 (see paragraph 5.7.2 of the report) and P3 (see paragraph 6.4.1 of the report). I note Ds have not filed their Answer as yet. In my view, given the nature of P2’s pre-existing role in GSL and P3’s pre-existing role in CBL, and their family/personal circumstances, it is not unarguable that P2 and P3 may retire at an age other than 65 years and 55 years. That being the case, ie in the absence of any Answer at this stage and recognising that Ds may raise the possibility of other notional retirement ages in the Answer, it is prudent to have the Experts address their opinion on a range of notional retirement ages. Otherwise, it will be an exercise in time and costs if the parties are to wait and see if Ds will raise such plea in the Answer, and if so raised then to approach the Experts again for their opinion in this respect.

45.  The fifth point of contention concerns materials to be provided to the Experts. Ds want to submit 3 documents relating to the adoption of Ps’ son in 2013 to the Experts. I am unable to see the relevance of these documents for the Experts in their forensic accounting exercise. The Psychiatric Experts have considered the matter of the adoption of Ps’ son in 2013, and as explained above, the parties will distill the factual assumptions/scenarios for the Experts from the available factual/opinion evidence.

46.  Given the above analysis and guidance, the parties should be able to finalise the joint instructions for the Experts. As said, it is not for this court to draft or revise the joint instructions for the Experts. I therefore direct that the parties shall within 14 days from today compile and agree on the finalised Draft, and within 7 days thereafter dispatch the joint instructions to the Experts.

47.  I also grant a costs order nisi that costs of the application be costs in the cause.