LI LAI FUN AND ANOTHER v. LEUNG YIU CHEUNG AND OTHERS

HCPI 697/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 697 OF 2002

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ASSESSMENT OF DAMAGES

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INTRODUCTION

1. This is an assessment of damages against the 1^st defendant (“the Defendant”) in relation to the claim brought by the plaintiffs as the administrators on behalf of and for the benefit of the dependants under the Fatal Accidents Ordinance (Cap.22)(“FAO”) and on behalf of the estate of the deceased, Chan (or Choi) Kai Chuen (“the deceased”), under the Law Amendment and Reform (Consolidation) Ordinance (Cap.23) (“LARCO”).  The plaintiffs are respectively the wife (“widow”) and the eldest son of the deceased.

2. The deceased died as a result of an accident on 20 August 1999.  The accident occurred when the deceased stopped the medium goods vehicle he was driving and stood by the nearside of the vehicle.  He was then struck by another medium goods vehicle driven negligently by the Defendant.  The deceased died before arriving at the hospital.  Interlocutory judgment on liability was entered by consent against the Defendant.  The claim had already been discontinued against the 2^nd defendant and not proceeded with against the 3^rd defendant upon the latter petitioning for bankruptcy on or about 10 October 2002.

3. The deceased was born on 5 December 1956 and was aged 42 years and 9 months at the time of the accident.  The deceased was a driver by occupation.  Prior to and at the time of his death, the deceased worked as a container truck driver for a Sanwa Marine Service Company (“Sanwa”).

4. The deceased left behind the widow, Madam Li Lai Fun, two sons, a daughter and the mother.  The widow (who was born on 5 May 1956), the eldest son (who was born on 4 September 1974), the second son (who was born on 18 February 1979), the youngest daughter (who was born on 6 July 1991) and the mother (who was born on 8 August 1917) were respectively aged 43, 24, 20, 8, and 82 at the time of the accident.  Up to the time of his death the widow and the three children were still living with, while the mother lived apart from, the deceased.  The plaintiffs claim that the widow, the three children and the mother are the dependants of the deceased.

AGREED DAMAGES

Bereavement and Special Damages

5. There is no dispute that the statutory sum of $150,000 and the sum of $63,068 are to be awarded respectively for bereavement and special damages inclusive of funeral expenses under the FAO.

DISPUTED DAMAGES

6. The damages I am required to determine under the FAO are damages for:

(i)    loss of dependency and

(ii)    loss of services.

7. The disputed damages under the LARCO claim are damages for:

(iii)    loss of accumulation of wealth.

EVIDENCE

Plaintiffs’ Application To Call Additional Witnesses

8. On the first day of the hearing of the assessment, the plaintiffs applied by summons dated 9 June 2004 for leave to call two additional witnesses, Mr. Cheng Wing Hang (“Mr. Cheng”) and Madam Fung Yuen Sang (“Madam Fung”) whose witness statements were served on the Defendant’s solicitors respectively on 25 May 2004 and 7 June 2004.  After hearing submissions from counsel, I acceded to the plaintiffs’ application and reserved my reasons to this judgment.  Here are my reasons.

9. Pursuant to the order made at the Checklist Review hearing, the plaintiffs have served on the Defendant witness statements of the widow and the two sons.  Mr. Cheng was the proprietor of Sanwa, which employed the deceased at the time of his death. According to Mr. Cheng’s witness statement, he handled Sanwa’s accounts.  Madam Fung is the director of a transportation company called Dragon Planner International Trading Transportation Limited (“the Dragon Planner”).  The explanation for the plaintiffs’ late application was set out in the affirmation of Wan Pui Shan, the plaintiffs’ solicitor, filed in support of the application.  In it, Miss Wan explained that Mr. Cheng was hitherto an unwilling witness and it was only through much persuasion that Mr. Cheng agreed to testify.  As for Madam Fung, Miss Wan stated that Madam Fung was not connected with the claim at all and it was only by chance that she was found to be able to render useful evidence in this case.  The plaintiffs were anxious to adduce evidence of these two persons for the purpose of corroborating the deceased’s pre-accident earnings as well as his notional earnings on the date of trial.  It was submitted that if the plaintiffs were not able to call these witnesses, the plaintiffs could only prove the deceased’s earnings by relying on Form 2 dated 26 August 1999 (“Form 2”)[1] and the deceased’s bank account deposits.

10. Mr. Hemmings for the Defendant objected to the application on the ground of prejudice.  He contended that as there were no records of the deceased’s earnings upon which he could cross-examine these witnesses, he was not in a position to test the veracity of the witnesses.

11. Under Order 38 rules 1 and 2A of the Rules of the High Court, the court retains a general discretion to allow a party to adduce further evidence at trial for the fair and expeditious disposition of the case.  In exercising my discretion to grant leave to the plaintiffs to adduce the evidence of the said witnesses, I have taken these matters into account: First, both of the witness statements of both Mr. Cheng and Madam Fung had already been served on the Defendant before the hearing.  The Defendant, should he wish to, could discredit the witnesses by applying for leave to adduce further evidence or by way of cross-examination.  The fact that the Defendant had made no application for leave to adduce further evidence has substantially undermined Mr. Hemming’s arguments on prejudice.  I was of the view that despite the lack of documentary records on the deceased’s earnings, there was nothing to preclude Mr. Hemmings from cross-examining the witnesses in the usual way.  Second, the earnings of the deceased were vigorously contested.  Apart from Form 2 and the bank accounts of the deceased, the plaintiffs would not be able to adduce any evidence to support the amount the deceased actually earned before or notionally earned after his death.  Mr. Cheng, in my view should be able to give direct evidence of the deceased’s pre-accident earnings and Madam Fung might be able to give evidence of the comparable earnings of container truck drivers.  Such evidence, should I accept, it would be highly relevant in assessing the deceased’s pre-accident and notional earnings.

12. In all the circumstances, I concluded that the relevance of these two witnesses would outweigh any prejudice, which prejudice I found to be none, that might have caused to the Defendant.

Evidence Adduced by the Parties

13. The plaintiffs called altogether three witnesses, Mr. Cheng and Madam Fung pursuant to the leave I have given, and the widow.  The deceased’s sons were not called as witnesses but their respective witness statements were agreed.  The plaintiffs’ bundle of documents (as contained in Bundle “D”) including, inter alia, documents concerning the age of the deceased and his family members, the bank statements as well as all the medical reports (Bundle C) were all agreed.  The Defendant during the assessment did not adduce any evidence or call witnesses.  After the case was closed, Mr. Hemmings during his closing submissions however sought to introduce evidence of the government statistics on the wages of the container haulage drivers contained in the Census and Statistics Department.  After hearing submissions from both counsel, I gave leave to Mr. Hemmings to re-open the case and adduce the said evidence as exhibit D1.  By consent, the plaintiffs were permitted to re-open their case and also adduced the evidence of the wages of the container haulage drivers contained in the government statistics and the bundle of correspondence exchanged between the plaintiffs’ solicitors and the officer from the Census and Statistics Department, which are respectively exhibits P1 and P2.

14. Credibility of the witnesses is not in issue.  The contention regarding the witnesses is rather one of reliability and relevance, the evaluation of which will be dealt with under each of the disputed items of damages.

DISPUTED DAMAGES UNDER THE FAO CLAIM

(i)  Loss of Dependency

(A)  The deceased’s earnings at the date of the accident

(a)  The deceased work’s pattern

15. The deceased and the widow were married at a young age of 17 in 1974.  The deceased purchased their matrimonial home at Yuen Long Plaza for a sum of $460,000 in or about 1984.  The property, uncompleted at the time of purchase, was registered in the joint names of the deceased and the widow.  The family moved into the matrimonial home in 1989, which home had been occupied by the deceased and his family as a family home at the time of his death and has been so occupied by the deceased’s family after his death up till the date of trial.  The deceased paid the monthly mortgage instalments before his death.

16. According to the widow’s evidence, the deceased was a driver by occupation.  In the 1980s, the deceased worked as a cross-border container truck driver earning around $20,000 per month.  After the daughter was born in 1991, the deceased still drove container truck but only within Hong Kong, earning about $15,000 a month.  He remained as a Hong Kong container truck driver until 1996 when he changed to work as a self-employed taxi driver.  Between 1996 and the end of 1998, when the deceased worked as a taxi driver, he worked two shifts for a total of about 14 hours a day.  The widow was unable to specify how much the deceased earned during this period but said that he was not making “enough money”.  From the small amount of cash deposits in the deceased’s account with the Kincheng Banking Corporation (A/C. No. 030-559-0-005196-8) (“Kincheng Account”), the principal account into which the deceased’s income was paid, during this period (which was between July 1997 to the end of 1998, the total amount of cash deposits being $20,000), I find the deceased was only able to make ends meet when he worked as a taxi driver.  It was in fact for the same reason, according to the widow, that the deceased stopped working as a taxi driver in search of a better-paid job. 

17. After the deceased stopped working as a taxi driver at the end of 1998, the deceased worked as a casual worker delivering meal boxes until sometime in April 1999 when he was employed by Sanwa as the local container truck driver until his demise.

(b)  The deceased’s wages claimed by the plaintiffs

18. The plaintiffs claim a sum of $27,000 per month as the deceased’s pre-trial earnings, relying on: First, the average monthly cash deposits of the deceased’s bank accounts in the sum of $25,800.  Second, Form 2 in which Mr. Cheng stated the deceased’s earnings in the month immediately preceding the accident to be in the sum of $27,000 and the average monthly earnings during the period of the deceased’s employment with Sanwa in the sum of  $21,500.  Third, the earnings of Dragon Planner’s container truck drivers.

(c)  The deceased’s bank deposits

19. The plaintiffs claim that for the period of 2.67 months between June 1999 until the date of the deceased’s death, the deceased’s bank deposits were on average in the sum of $25,800 per month.  The plaintiffs sought to exclude the relatively smaller deposits in the month of May 1999 in their calculation on two grounds.  First, the month of May was the beginning of the deceased’s new employment and it could not fairly reflect the deceased’s actual earnings.  Secondly, the employer had by the end of May 1999 failed to pay the deceased wages in advance.  Mr. Bharwaney submitted therefore that it was not appropriate to take into account the deposits in May in determining the deceased’s total bank deposits during his employment with Sanwa.  Hence, Mr. Bharwaney submitted that the average monthly deposit of $25,800 was the best and yet the most conservative evidence of the deceased’s earnings on the date of the accident.

20. Mr. Hemmings contended that the monthly earnings of $27,000 claimed by the plaintiffs were not borne out by any documentary evidence.  In support of his contention, Mr. Hemmings analysed in great detail the deceased’s bank deposits during the period of May 1999 to August 1999, the period of the deceased’s short employment with Sanwa.  It is undisputed that at the time of his death, the deceased maintained three accounts.  The Kincheng Account into which most of the deceased’s earnings were paid, a Bank of China account (numbered 030-573-1-003848-5) (“BOC Account”) and a Heng Seng Bank Savings account (numbered 237-2-040036) (“Heng Sang Account”).  The BOC Account was maintained for effecting transfers to the joint instalment loan account in the name of the deceased and the widow with the Bank of China (which account is numbered 030-573-4-0000193-2 and was previously operated by the Kincheng Banking Corporation)(“Instalment Loan Account”) for paying the mortgage instalments of the matrimonial home. The Heng Sang Account was maintained for paying the mother’s utility bills.  A summary of all the deceased’s bank deposits was helpfully compiled by Mr. Hemmings, which summary I annex to the judgment (Appendix I).  

21. The summary compiled by Mr. Hemmings shows that the total amount of the deposits in the said three accounts during the period of May to August 1999 was in the sum of $77,000.  However, this sum, contended by Mr. Hemmings, would have to be further reduced if I were to find that the Kincheng Bank deposit of $6,500 dated 17 July 1999 came from the withdrawal of the sum of $17,000 from the Heng Sang Account.  The total deposits in that case would be $70,500.  After averaging the net deposit of either $77,000 or $70,500 by 3.65 months, that is, from 1 May 1999 to 20 August, the monthly average deposit will be either $21,095 or $19,315.

22. In determining the deceased’s average monthly bank deposits during his period of employment with Sanwa, it is necessary to have regard to the evidence of Mr. Cheng, who was directly responsible for managing Sanwa and paying the deceased.  According to Mr. Cheng, the deceased started working for Sanwa at the beginning of April 1999.  The deceased was remunerated on a “piece-meal” basis, that is, he was paid $150 for each container he delivered in each trip between Lok Ma Chau and Kwai Chung.  This payment is usually referred to as the “container money” in the container trade.  The total amount of “container money” earned by the deceased for each month was paid at the beginning of the month that followed.  Mr. Cheng paid the deceased by depositing the earnings into the deceased’s account designated by the deceased either by cash or by cheque.  Owing to the company’s cash flow problem, Mr. Cheng was unable to pay the deceased the “container money” he earned in the preceding month in one payment; instead, he paid the deceased by separate payments.  As from the end of May or the beginning of June 1999, Mr. Cheng was already unable to pay the deceased on time.  It is also significant to note that during the short period when the deceased worked for Sanwa, it was also the busiest period of the year, which period was usually in the months of July and August.  The quietest period, according to Mr. Cheng, was usually in the month immediately after the Chinese New Year, which was around February and March.

23. Hence, the concept of advanced payment as understood by Mr. Bharwaney is a misunderstanding of the evidence of Mr. Cheng.  The deceased was not paid his wages in advance.  The “advanced payment” when put into the context of Mr. Cheng’s evidence could not be taken to mean advanced payment in the sense we commonly understand.  According to Mr. Cheng’s evidence, the deceased was paid only at the beginning of month for the wages earned by the deceased in the preceding month.  Strictly speaking it was in fact payment in arrears.  This method of payment was consistent with the way the deceased was remunerated.  The “container money”, the basis upon which the deceased was remunerated, was calculated in accordance with the number of containers he had delivered.  Thus, it would not be possible for the employer to pay the deceased in advance before the number of containers he had delivered could be ascertained.  I do however accept that there might have been occasions, which in my finding were not frequent, when Mr. Cheng might have been asked by the deceased to pay the container money to him before the container money was payable when he was pressed by the mortgagee bank for the payment of the overdue mortgage instalments.  These are only the exception rather than the norm.  Around the end of May or the beginning of June 1999, Sanwa was unable to pay the deceased at the beginning of each month. 

24. Having borne the above evidence in mind, I will now deal with the deposits of the deceased’s bank accounts.

25. After having carefully considered the evidence of Mr. Cheng, I find the plaintiffs’ reasons for not including the month of May in calculating the average monthly deposits are not well founded.  A fair calculation of the deceased’s bank deposits should include also the deposits in the month of May 1999. Thus, after disregarding the deposits in relation to the two returned cheques dated 22 July 1999 and 26 July 1999 as shown in the Kincheng Account and those deposits in the BOC Account representing transfers from the Kincheng Account, I find that Mr. Hemmings’ calculation of $77,000 to be correct, which sum has of course included the questionable deposit of $6,500 dated 17 July 1999 in the Kincheng Account.   

26. Upon a more careful analysis of the bank statements of the deceased’s accounts, I find the said sum of $6,500 deposit probably came about in this way – On 17 July 1999, after a sum of $17,000 was deposited into the Heng Sang Account through the automatic teller machine, its entire amount was withdrawn on the same day.  It was also on the same day that the said sum of $6,500 was deposited into the Kincheng Account from which account the sum of $5,000 was transferred to the BOC Account.  The said transfer of $5,000, according to the bank statements of the Instalment Loan Account, was for paying a mortgage instalment of $4,659 (see pp.228 and 234 of the Agreed Bundle D).  After having transferred the sum of $5,000 to settle the mortgage instalments, the deceased probably realised that there was still a small sum of money left standing to the credit of the BOC Account which I believe was a non-interest bearing account; he therefore effected two transfers in the sums of $60 and $300 from the BOC Account back to the Kincheng Account respectively on 17 July and 19 July 1999.  Hence, I find on the balance of probabilities that the said deposit of the sum of $6,500 into the Kincheng Account came from the withdrawal of the sum of $17,000.  The annual statement of the Instalment Loan Account shows that mortgage instalments were sometimes overdue which could be for several months (for example, between the months of June 1998 and September 1998 and the months of October 1998 and January 1999).  In view of the constant late mortgage payments, it is reasonable to infer that the deceased, whenever he was paid, would be anxious to deposit money into or transfer it to the BOC Account to settle mortgage payments.  In the circumstances, I am satisfied that the total sum of the deceased’s bank deposits during the period of May 1999 to 20 August 1999(a total 3.65 months) was $70,500, an average of $19,315 per month.

27. As it is common ground that the best evidence of the pre-accident earnings of the deceased appears from his bank deposit, I am inclined therefore to find that the average monthly earnings at the time of his death were not less than $19,315.  This amount of $19,315 however only represents the actual receipts during the deceased’s employment with Sanwa.  It does not reflect other wages which the deceased would have been entitled to but were not yet accrued on the date of his death.  Thus, a proper determination of the deceased’s actual pre-accident earnings should also take into account other evidence including the information contained in Form 2.

(d)  Wages stated in Form 2

28. According to the information stated by Mr. Cheng in Form 2, the deceased worked for an average of 29 to 30 days in the past 4 months before the deceased’s death and there was no fixed rest day.  For the earnings immediately preceding the date of the accident, the deceased’s earnings were stated to be $27,000 which sum however was described by Mr. Cheng in Form 2 as “profit-sharing” and “commission”.  Mr. Cheng also stated that the deceased’s average monthly earnings for the 4-months’ period of the deceased’s employment were about $21,500.

29. The actual basis upon which the said sum of $27,000 was calculated was clarified in Mr. Cheng’s oral evidence.  According to Mr. Cheng, the two income figures appearing in Form 2 were based on his memory rather than on any written records.  In Form 2, the said sum of $27,000 was stated to be the earnings from profit-sharing and commission because Mr. Cheng said that he was unable to find a more appropriate way of describing the basis upon which the deceased was remunerated, which was on the basis of piece-rated  “container money”.  Mr. Cheng further said that in the transportation business, the remuneration the container drivers received was seldom described as “wages”.  Hence, the terms “commission” and “profit-sharing” were chosen by Mr. Cheng to describe the actual sum of $27,000 the deceased earned although this sum has not yet taken into account the deceased’s profit-share.  The profit-share was the bonus that would have been distributed to the deceased when Sanwa made a profit. Mr. Cheng estimated the amount the deceased would likely receive had he worked until March 2000 would be in the region of around $30,000 to $40,000. 

30. After having had the opportunity of observing Mr. Cheng giving evidence in court, I find that he was firm in respect of the evidence on the earnings of $27,000 he had stated in Form 2. He said he had “ a deep impression” of that amount.  I am satisfied that the deceased had earned the net sum of $27,000 in the month immediately preceding his death and that he would be entitled to a bonus of around $30,000 to $40,000 upon the completion of his one year’s service with Sanwa had he not met with the fatal accident.

31. The sum of $27,000 earned by the deceased in the month before his death is however not typical of the deceased’s usual earnings.  The amount of $27,000 only shows the deceased’s earnings in one of the busiest months.  The deceased’s average monthly earnings, according to Form 2, were stated to be in the sum of $21,500.  Mr. Cheng admitted that the average earnings of $21,500 stated in Form 2 were not based on any form of written records.  It was based on his overall estimation.  I am however satisfied that this amount inserted by Mr. Cheng was to be reliable as at the material time Mr. Cheng was the proprietor of Sanwa and was responsible for the operation of the company including the handling of income and expenditure of Sanwa. Mr. Cheng completed Form 2 only about 6 days after the accident.  His memory at that time as to the deceased’s earnings during the short period of his employment should be fresh and reliable.  Hence, I am satisfied that Mr. Cheng’s estimation of the deceased’s average monthly earnings of $21,500 was reliable.  According to his evidence the amount of $21,500 was based on the earnings of the deceased for the past 4  ½ months as well as his prediction of the amount the deceased would have earned in the following year up till March 2000.  I am therefore inclined to find that the average monthly earnings of the deceased, exclusive of any profit share the deceased was found to have likely received, was $21,500.

32. When the bonus or the “profit-sharing” in the total sum of about $30,000 to $40,000 in a year is added to the average monthly earnings of $21,500, it produces a figure of between $24,000 to $25,000, and I round this up to $25,000.

33. In order to cross-check the figure of $25,000 which I find to be the deceased’s pre-accident earnings, I have also had regard to the evidence of Mr. Cheng contained in his witness statement regarding the number of trips the deceased made each day.  In 1999, the deceased was paid $150 for each trip between Lok Ma Chau and Kwai Chung Terminal.  Mr. Cheng also said that a local container truck driver could usually make 6 trips a day and a maximum of 9 trips during busy times.  When the peak and slack periods are taken into account, the deceased should on average has been able to make 6 trips and work 25 or 26 days a month, which come to a total sum of about $23,000 per month.  This sum when added to the bonus, which I find the deceased would have been entitled to, would produce a figure of around $30,000 per month, which is slightly higher than the sum of $25,000 I have concluded.

34. The said higher figure deduced from Mr. Cheng’s witness statement should be placed in the context of  his evidence concerning Form 2. Faced with the variance of these two figures, I am inclined to prefer Mr. Cheng’s evidence concerning Form 2.  The evidence he gave in paragraph 33 above was contained in his witness statement given shortly before the hearing for assessment.  On the other hand, when he inserted the income figures in Form 2, it was shortly after the accident.  Thus, Mr. Cheng’s memory would be fresher in 1999 when he provided the information in Form 2 than in 2004 when he gave his witness statement.  In the circumstances, I am satisfied that that the amount of $25,000 is more reliable than the income deduced in paragraph 33 above.

(e)  The evidence of the wages paid by Dragon Planner to its container truck drivers

35. Mr. Bharwaney sought to corroborate the plaintiffs’ claim for the deceased’s earnings in excess of $27,000 per month by relying on the evidence of Madam Fung. Madam Fung has been engaged in the transportation business for over 10 years and previously operated the said business as a proprietor of an unlimited company, which was incorporated to become Dragon Planner 3 years ago.  According to her oral evidence, in 1999, her company’s container truck drivers driving locally like that of the deceased on average earned about $30,000 per month. 

36. In determining the deceased’s earnings at the time of his death, I am of the view that the most reliable evidence in the present case should be the direct evidence form the employer whose evidence I have referred to above.  I find it of little assistance to compare the earnings of the drivers employed by Madam Fung for the purpose of assessing the earnings of the deceased.  The businesses of Mr. Cheng and that of Madam Fung albeit similar in nature differ greatly in scale.  Although the number of drivers Mr. Cheng employed in year 1999 is unclear, there is evidence from which I can infer that his business was by comparison quite small in scale.  In 1999, Sanwa, although at that time having more than one container trucks, had a high turnover of drivers around that period as the company was not effecting payments to the drivers punctually.  Mr. Cheng employed the deceased in April 1999 as a replacement rather than an additional driver.   Since 1999, the entire transportation business has gone downhill and Sanwa currently only owns one container truck driven by Mr. Cheng himself.

37. Madam Fung’s business is substantially larger in scale than that of Mr. Cheng’s. In 1999, when Madam Fung was operating her business as a sole-proprietor, the business was already employing 20 permanent truck drivers.  In 1999, her business was incorporated and despite the business downturn has managed to keep a similar number of permanent drivers. 

38. The marked differences in the business scale in my view make it unsuitable to adopt the wages of Madam Fung’s drivers for the determination of the actual earnings of the deceased at the time of his death.

(f)  The government’s statistics

39. In coming to a finding of $25,000 in respect of the deceased’s earnings at the time of his death, I also note that the said sum is higher than the government statistical wages of container haulage drivers.  According to the government statistics, for the quarter months of March, June and September 1999, a container haulage driver with an average working days of 9 hours a day and 26 days a month, reportedly earned respectively $16,822, $17,264 and $18,928 per month.  The average wages during this period is in the region of about $17,600 per month.  In response to the inquiries made by the plaintiffs’ solicitors to clarify the said statistical information, an officer from the Census and Statistics Department clarified in her e-mail that the wages set out in the statistics did not include profit share (See Exhibit P2).  Thus, to obtain a more accurate comparable, I should further add a sum of $3,000 representing the profit-share, to the average monthly wages of $17,600, which produces a figure of about $21,000.  This sum of $21,000 calculated in accordance with the government statistical wages is still observed to be lower than the sum of $25,000 I find to be the deceased’s pre-accident earnings.

40. The wages contained in the government statistics in my view cannot be regarded as an accurate record of the deceased’s actual earnings on the date of the accident.  My finding of the deceased’s actual earnings is based on the direct evidence from the deceased’s employer.  On the other hand, the government statistics, as rightly pointed out by Mr. Bharwaney, have been compiled from a small selection of samples, and have the weakness of being unrepresentative.  Hence, in determining the deceased’s earnings at the time of his death, I do not find it helpful to refer to the government statistics.

(g)  Conclusion on the deceased’s earnings on the date of accident.

41. For the matters foregoing, I am satisfied that the deceased’s monthly earnings on the date of the accident was $25,000.

(B)  The deceased’s notional earnings as at date of assessment

42. Since the death of the deceased, the earnings of the container truck drivers have declined substantially.  While conceding that the wages of container truck drivers have declined, Mr. Bharwaney, relying on the evidence of Madam Fung, submitted that the deceased’s notional earnings should be in the region of around $20,000 to $22,000 per month.  According to Madam Fung, the container money in the transportation business has since 1999 decreased from $150 per container to presently $110. The local container truck drivers of Dragon Planner can still earn $20,000 to $22,000 per month as at date of assessment.

43. Mr. Hemmings contended that the earnings of the drivers of Dragon Planner are not suitable comparables for assessing the deceased’s current notional earnings as Madam Fung’s business has been doing exceptional well and therefore the earnings of her container truck drivers cannot realistically reflect the earnings of the majority of the container truck drivers.  He instead sought to rely on the Government statistics to support his contention that the deceased notional earnings should be $14,175 per month.  This figure is based on the government statistics of the March 2004 quarter on the wages of container truck drivers with an average daily wage of $569 for a 25 days working month.

44. The assessment of a deceased’s notional earnings on the date of trial is never an easy task.  To enable a court to properly determine the wages likely earned by the deceased on the date of trial, I should, in my view, consider all the factors affecting the income of the deceased, which factors include, inter alia, the deceased’s job pattern, his age on the date of trial, the comparable earnings, government statistics and the market condition at the time of the deceased’s death and on the date of trial.  I now consider these factors in order to properly assess the deceased’s notional earnings.

(a)  The deceased’s age and job pattern

45. On the date of trial, the deceased would have been 47 years of age.  The deceased was in the main a container truck driver by occupation though there was a short period of about two years when he worked as a taxi driver.  The nature of the job as a container truck driver is not just tough and demanding, requiring drivers to work long hours with irregular rest days, but also relatively mobile and vulnerable to any changes in market conditions.  It is also seasonal with a peak period lasting for about 3 months during which time drivers work about 28 to 29 days and a period of quiet months after the Chinese New Year.  When the deceased died in August 1999, he was 42 and ½ years of age.  Based on the evidence of Mr. Cheng, I find that had the deceased lived and kept working as a local container truck driver today, at the age of 47, he would have been able to meet the demands of his job.  According to Mr. Cheng, in 1999 when the transportation business was much more prosperous than today, he did not himself drive container trucks but was mainly involved with managing the business of Sanwa.  As his business has deteriorated, Mr. Cheng, now at the age of 50, drives a container truck himself and is able to work 12-14 hours for about 5 to 6 days a week, thus he works a total of about 20 to 25 days a month.  It is not clear if the 20 to 25 days per month work schedule is due to the ebbing business or due to his physical condition.  In light of the tough time faced by the transportation business, I find it more likely that the shorter working days are due to the insufficiency of work rather than Mr. Cheng’s health.  As the deceased was an experienced driver, the deceased would therefore have been placed in a much better position to cope with the demands of work than Mr. Cheng.

(b)  Comparable earnings – the current wages of the drivers engaged by Dragon Planner

46. As mentioned above, Madam Fang’s business is by comparison much larger in scale than that of Mr. Cheng’s.  While accepting that the deceased in the past only worked for a company of a modest size, Mr. Bharwaney, relying on the undisputed evidence that the deceased was a model driver, submitted that it is likely that the deceased would but for the death have worked as a container truck driver with a company such as Madam Fung’s on the date of trial and therefore would have earned a similar level of income as the permanent drivers of Dragon Planner, which is $20,000 to 22,000 per month.

47. Before his death, the deceased had had at least 15 years of experience as a container truck driver with experience in driving across the border as well as locally.  Thus, at the time of his death, the deceased was undoubtedly an experienced and mature driver.  There is no evidence however before me that the deceased had ever worked for a company of a scale as large as that of Madam Fung’s.  In the premises, I cannot agree with Mr. Bharwaney that the deceased but for the accident would be employed in a company similar to Dragon Planner.  I find therefore that the wages earned by the drivers of Dragon Planner cannot be used as an analogy of the deceased’s notional current earnings.  Whilst I agree with Mr. Bharwaney’s submissions that employers generally prefer mature and experienced drivers, I take the view that the deceased would have been less likely to obtain employment with a company of a substantial scale at the age of 47 today had he not died than in the prime of his working life before his death.  In my view, I find it more likely that the deceased but for the accident would still work on the date of trial for a kind of business establishment similar to that of Sanwa’s.

(c)  Government Statistics

48. The inherent shortcomings of the government statistics on the wages of haulage truck drivers are already set out above.  For these reasons, I do not find it appropriate to adopt the daily wages of the container haulage drivers of $567 as shown in the March 2004 quarter of the government statistics as the notional earnings of the deceased on the date of trial as suggested by Mr. Hemmings.  It is also not suitable or fair in my view to refer the wages contained in the March quarter of 2004 as a basis for determining the deceased’s notional earnings as the March quarter falls within the quietest period in the transportation business.  These wages can hardly reflect the actual average earnings of the container truck drivers, a fortiori, the notional earnings of the deceased.  Hence, I am not inclined to adopt the wages contained in the government statistics to determine the deceased’s notional earnings on the date of trial.

(d) Market condition

49. According to the evidence of both Mr. Cheng and Madam Fung,  a local container truck driver is now only paid $110 per each trip between Lok Ma Chau and Kwai Chung as a result of the ebbing economy since 1999.  According to Mr. Cheng’s evidence I have referred to in paragraph 33 above, a local container truck driver could usually make 6 trips a day and a maximum of 9 during busy times.  As the transportation business had dropped substantially, I find that the deceased if he had lived today would unlikely make more than 6 trips a day and work more than 26 days a month.  The number of working days in my view can be corroborated by the evidence of Mr. Cheng in paragraph 45 above that he worked 25 to 26 days a month on the date of trial.  Thus the deceased on the date of trial would likely have earned $660 a day ($110 x 6 trips) and about $17,000 per month.  Further, the poor economy makes it unlikely for an employer to distribute bonus to container truck drivers.  In the absence of evidence to bear this out, I am not inclined to include in the deceased’s notional earnings any amount representing profit sharing.

(e)  Conclusion on the deceased’s notional earnings

50. Having borne in mind all the factors I have mentioned above and carefully considered all the evidence before me, I conclude that the deceased’s notional earnings as on the date of trial are $17,000 per month.

(f)  Median

51. For the purpose of assessing the pre-trial and the post-trial losses of dependency, I would adopt the median of $21,000 for the pre-trial loss and the figure of $17,000 for post-trial loss. 

(C)  Pre-trial loss of dependency

(a)  The traditional approach or the modern approach?

52. There are two different ways by which the loss of dependency is assessed.  One is the so-called conventional approach by which the loss of dependency of each of a deceased’s dependents is separately calculated.  However, this traditional approach “has all been swept away and the modern practice is to deduct a percentage from the net income figure to represent what the deceased would have spent exclusively on himself.” (Per O’Connor L.J. in Harris v Empress Motors Ltd. [1984] 1W.L.R. 212 at 217A).  This modern practice of assessing the loss of dependency by a percentage deduction is commonly referred to as the Harris method.

53. In this assessment, both counsel are in agreement that the Harris method should be adopted for assessing the loss of dependency as it has the advantage of being simple and straightforward.  Despite the consensus of parties as the method to be adopted, I should in my view only adopt this practice if I am satisfied that the simplicity of this approach will not give rise to any injustice.  Hence, I should consider the characteristics of the dependency in this claim before I decide whether the modern practice should be adopted in this assessment.

(b)  The characteristics of dependency

54. The plaintiffs claim that on the date of the deceased’s death, he had left altogether five dependents – the immediate family comprising the widow, the two sons and the daughter and the extended family, the deceased’s aged mother.

55. According to the widow’s witness statement, which I ordered to stand as evidence in chief and her oral evidence, the widow throughout her marriage had only worked part time.  In 1995 however she changed to work full time until the month before deceased’s death when the widow stopped working altogether.  At the time of the death, the deceased resided at the matrimonial home with the widow and all the three children whilst the deceased’s mother lived alone in public housing.  The widow said that at the time of the death of the deceased, the deceased gave her $7,500 each month for paying all household expenses including utility charges, groceries and management fee, $3,000 to her as personal expenses, $2,000 to each of the sons who were unemployed at the time and $1,500 to the daughter and $2,500 to his mother.  The deceased also paid for the mother’s rent and utilities charges in the total sum of about $1,150.  After having paid the monthly mortgage instalment of about $4,500, the deceased retained the rest of his income for his own personal expenses.  The said sum of $7,500 however was clarified in the cross-examination when the widow admitted having made a mistake in relation to the electricity expenses, which should be $750 instead of $1,400.  Thus the amount for the housekeeping money as clarified should be $6,750.  

56. The dependency of the two sons at the time of the deceased’s death arose in this way.  The elder son left school after completing Form 3.  After having left school, the elder son had taken up a number of jobs until 1997 when he became unemployed and had remained unemployed at the date of the deceased’s death.  The elder son was solely dependent on the deceased during this period of unemployment.

57. The younger son in terms of education and employment was far from impressive.  He left school at the age of 13 without completing Form 1.  After having left school, he did not have a job but seemed to have gone astray with a history of committing petty crimes in connection with theft, criminal damage and drugs.  He was sent to a youth drug treatment centre for drug rehabilitation as a result of a breach of probation order imposed by the court for a drug conviction.  After his discharge from the drug treatment centre at the age of 18, he remained unemployed and has so remained at the date of the deceased’s death.  He was solely dependent on the deceased.

58. After the death of the deceased, the financial dependency of the widow, the daughter and the mother has not changed materially.  The circumstances of the two sons’ however have changed and so have their financial dependencies.  The elder son has since the beginning of 2001 been employed by Kowloon Motor Bus Company as a bus captain, earning about $12,000 per month.  He continued to live at home and contributed $2,000 towards the family household expenses and also took care of the expenses of his grandmother (the deceased’s mother).  In January 2003 he got married with a Mainland resident who travels to Hong Kong on a two-way travel permit to visit the elder son on a regular basis.  During these visits, the elder son’s wife also lives in the matrimonial home with the elder son and the rest of his family.  The elder son recently had a daughter who is taken care of by the wife in Mainland China.  The elder son still gives $2,000 to the widow and gives $2,000 every month to the deceased’s mother.

59. The second son on the other hand seems to have continued to lead a wayward life.  Apart from working for only about one month in or about July 2003, the second son has effectively been unemployed up till the date of trial.  In June 2002, he got married and had a daughter.  After marriage, the second son, his new wife and their daughter also resided in the matrimonial home as an extended family. In or about May 2003, the second son together with his wife and the baby daughter moved out from the matrimonial home and, together with the grandmother (the deceased’s mother), to a bigger public housing flat allotted by the government.  In July 2004, the second son’s wife deserted him and his baby daughter has since been looked after by the widow during the week and is only returned to the second son’s care on weekends.  As the second son has been unemployed, the widow said that she has been paying the expenses for his baby daughter in the sum of $2,000 per month.  She no longer gives any money to the second son as the second son and the deceased’s mother are receiving public assistance in the sum of about $4,000.  The rental of the public housing flat, which is currently occupied by the second son and the deceased’s mother, is also being paid by the Social Welfare Department. 

60. The above is a summary of the characteristics of the dependency of the deceased.  Whilst the two sons can no longer be regarded as dependents, the number of persons who are treated by the widow as the dependents has not been substantially reduced with the cessation of the sons’ dependencies.  The dependency on the date of trial should only comprise the widow, the daughter and the deceased’s mother. The widow, however, has to incur extra expanses for the second son’s daughter in the sum of about $2,000 per month.  The extra expenditure in respect of the second son’s daughter has effectively made her a de facto dependant, whose financial burden on the widow would be likely to last for some time in view of the poor employability of the second son.

(c)  The approach the court adopts

61. Having had regard to the character and nature of the dependency, I am satisfied that this is a kind of case where the loss of dependency can be assessed by deducting a percentage of the deceased earnings the deceased would have spent on himself exclusively, with the remaining percentage representing the common expenses for the deceased himself and the entire family living under the same roof, which expenses would have included expenses for the second son’s daughter, and expenses for the widow, the daughter and the deceased’s mother.  Hence, I am inclined to agree with counsel that the Harris method is appropriate in the circumstances.

(d)  The appropriate percentage to be deducted from the deceased’s net income to represent the exclusive expenses of the deceased

62. According to the practice elucidated in Harris, the court in assessing the real dependency of a deceased is required to deduct “a percentage from the net income figure to represent what the deceased would have spent exclusively on himself.  The percentage have become conventional in the sense that they are used unless there is striking evidence to make the conventional figure inappropriate because there is no departure from the principle that each case must be decided upon its own facts.  Where the family unit was husband and wife the conventional figure is 33 percent and the rationale of this is that broadly speaking the net income was spent as to one-third for the benefit of each and one-third for their joint benefit…  Where there are children the deduction falls to 25 percent…” (per O’Connor L.J. in Harris [1984] 1W.L.R. 212 at 217B-C).

63. While both counsel agree that the Harrismethod should be applied, Mr. Hemmings contended that instead of deducting a conventional percentage of 25 percent from the deceased’s earnings to represent his exclusive expenses on himself, a deduction of 30 percent is appropriate. His contention is based on three reasons.  First, the deceased’s two adult sons should not be regarded as dependents either at the time of the deceased’s death or at the date of trial.  Secondly, the deceased’s mother is elderly and the multiplier to be applied is substantially small.  Third, the deceased’s mortgage commitment had he lived would have already been discharged on the date of trial as the mortgage loan was already fully repaid by the beginning of 2004.  These factors, according to Mr. Hemmings, make it reasonable to infer that had the deceased enjoyed a natural life span, his financial obligations would be reduced progressively and it is likely that he would have applied a much larger percentage of his income on himself for his own enjoyment in life.

64. While the Harris approach is usually adopted for its attractive simplicity, the court in my view in adopting this method of assessing dependency should carefully guard against any injustice that may be caused to the dependents by departing from a conventional approach of 25 percent deduction.  Apart from the widow’s evidence already referred to above, the widow also stated in her evidence that at the time of the deceased’s demise, the deceased after having paid for the mortgage instalments and the rent and utilities charges for his mother, he “gave the remaining of his salary as much as he could to me (the widow) after he had received the money from his employer for my (the widow) further distribution to the dependents… and the housekeeping money…  If there was extra money left, I would save it for future use or for some unusual expenses or miscellaneous expenses such as clothes, medical expenses, repairs and furniture…) (paragraphs 20 and 21 of the widow’s witness statement).

65. From this evidence, I am inclined to accept that the widow was required to carefully and conscientiously budget the household purse sometimes at the expense of her own needs for the benefit of the children.  The daughter although having been described as academically bright by the widow, I am unable however to come to any confirmed view that she is expected to achieve any exceptionally high educational level.  Her dependency, even without regard to the aspiration of the widow for her, will still last for quite some time owing to her relatively young age.  The daughter’s dependency will progressively increase as she grows older.  The daughter’s dependency, coupled with the de facto dependency of the second son’s baby daughter, cannot support Mr. Hemmings’ proposition that the deceased would have likely spent a larger percentage of his income exclusively for his own enjoyment upon the repayment of the mortgage loan.  In the circumstances, a departure of the conventional deduction of 25 percent is unjustified.

66. Applying a deduction of 25 percent from the deceased’s median earnings I have calculated above, I award the following damages for the pre-trial loss of dependency:

                   $21,000 x 75% x 61 months = $960,750

67. In order to crosscheck if the conventional 25 percent deduction will produce an award which will work an injustice against the Defendant, I also have had regard to the traditional method of calculating the dependency claim in accordance with the approach set out in the Plaintiffs’ Revised Statement of Damages.  Having compared the total amount of damages I have calculated above and the rough figure arrived at by using the traditional method, I am satisfied that the amount of the overall dependency claim is not of any significant difference that would cause an injustice to the Defendant.

68. I therefore award a sum of $960,750 as pre-trial loss of dependency.

(D)  Future Loss of Dependency

69. After having determined the current notional wages of the deceased as on the date of the trial and a deduction of the conventional percentage of 25 percent from the deceased’s earnings in assessing loss of dependency, I am only required to determine the remaining issue in dispute under the loss of dependency, that is, the appropriate multiplier to be applied in assessing the deceased’s future loss of dependency.  As I have adopted the Harris method for assessing damages for the loss of dependency, a single multiplier should be applied in assessing future loss of dependency.  (See Wong Po Lin & Ano, HCPI593 of 1999, unrep.).

70. The plaintiffs in their Revised Statement of Damages originally claim a global multiplier of 17, which was revised to 15 by Mr. Bharwaney in both his opening and closing submissions.  Mr. Bharwaney argued that as this claim is a fatal case, a multiplier to be applied should exceed the multiplier in personal injuries cases for the simple reason that the widow’s dependency does not stop on the deceased’s retirement but continues for so long as he can support her from his retirement savings.  He cited the Personal Injury Tables[2] and a number of authorities in support of his submissions with particular reliance on the decision of Wong Sin Lam v Kuen Fung Construction Ltd. and 2 Ors. (HCPI1286 of 1999) in which Stone, J. awarded a multiplier of 14 to a steel fixer deceased who was 38 at the time of death in assessing loss of dependency.

71. Mr. Hemmings contends that the appropriate multiplier for the deceased should be 12, relying on Wong Po Lin & Ano. (HCPI593 of 1999, unrep.) and Tsang Mei Ying and So Sau Lin v Lam Pak Chiu & Ano. (HCPI 544 of 1998).

72. In considering the appropriate multiplier to be applied, I am unable to accept Mr. Bharwaney’s arguments that the dependency of the deceased’s dependents in this claim could exceed the duration of the deceased’s working life.  There may be circumstances where a multiplier should take into account a dependency beyond a deceased’s working life such as where a deceased continues to receive substantial income after retirement.  Having had regards to the evidence of dependency before me, I do not think this is such a case.  Thus, after having carefully considered all the authorities submitted by counsel and their submissions, I am satisfied that the appropriate multiplier, which, after having been discounted to reflect the vicissitudes of life and the acceleration of a lump sum receipt, should be 13.

73. Applying a multiplier of 13 from the date of the death of the deceased and reducing it by 61 months for the pre-trial loss of dependency, the future loss of dependency is therefore:

                   $17,000 x 75% x (156 - 61 months) = $1,211,250

(ii)  Loss of Services

74. The remaining disputed item under the FAO claim is the plaintiffs’ claim for loss of services.  This claim is based on the widow’s evidence that the deceased had assisted the widow with household chores such as cooking, changing light bulbs and taking care of the children on his rest days.  They claim a total sum of $84,000 under this head on the basis of a loss of $6,000 per annum with a multiplier of 14.

75. An award under this head should be made if the plaintiffs can prove that the dependents have suffered a pecuniary loss of the gratuitous services rendered by the deceased, which services would have continued but for the death.  At the time of the deceased’s death, the widow was already a full-time housewife and has remained so up to the date of trial and the daughter was the only child who was required to be looked after.  In view of the widow’s age that is 48 on the date of trial and her being out of the job market for a number of years, I find there is little likelihood that the widow will return to the job market.  Hence, the widow will remain a full-time housewife looking after the youngest daughter and the extended family members living in the same household.  The sons on the date of the deceased’s death had already left school for a number of years and continued to reside at the matrimonial home.  In fact, both of the sons have continued to live at the matrimonial home even after their respective marriages and it was only in 2003 that the second son moved out to live with his grandmother.  The services, which the widow said the deceased had rendered, in my view, were more likely to have been performed by the sons rather than the deceased.  I have heard evidence on the long hours the deceased had worked, which effectively had left him virtually with little time to perform any of these services for the family. In view of the nature of his work and the age of the sons living at home, I find it unlikely that the deceased would either have the capacity or the time to render the kind of services described by the widow.  Here, I am not dealing with a case where the widow was required to engage outside help with her household chores or the daughter’s homework as a result of the deceased’s death.  While I do not question the hard-working nature of the deceased, I find on the balance of probabilities the plaintiffs have not proved any loss of services. I am therefore not persuaded to make an award in favour of the plaintiffs under this head of claim.

DISPUTED DAMAGES UNDER LARCO

Loss of Accumulation of Wealth

(A)  The plaintiffs’ claim

76. The claim is based on s.20 (2)(b)(iii) of the LARCO which provision enables a court to award damages if it is satisfied that “but for the act or omission that gave rise to the cause of action, the deceased would have achieved an accumulation of wealth by the time that he would otherwise have died.”  The plaintiffs claim in the Revised Statement of Damages a loss in the region of $1,000,000, which was revised down to $800,000 by Mr. Bharwaney in his closing submission.  In support of their claim for the loss to the estate, the plaintiffs though having pleaded savings in the sum of $8,000 on the date of the deceased’s death in the deceased’s Kincheng Account, have in the main relied on these facts to support his claim, that is the Mandatory Provident Fund (“MPF”) Scheme and the equity of the matrimonial home.

(B) Savings pattern

77. On the date of his death, the deceased had a credit balance of $8,000 in his Kincheng Account, although he did not seem to have established a pattern of regular savings.  When the total bank balances of the deceased’s banks accounts were added up, it is found that the deceased, apart from an outstanding mortgage loan in the sum of $216,066, was in debt in the sum of about $23,000.  Thus, I am unable to find from the deceased’s bank accounts that the deceased had established a regular pattern of making savings from his income.  The evidence seems to be the contrary.

78. The absence of a savings pattern according to the Court of Final Appeal decision in Lam Pak Chiu v Tsang Mei Ying & Ano. [2001] 1HKLRD19 however does not preclude a court from allowing an award under this head if it is satisfied that “but for the act of omission which killed him, the deceased would have achieved an accumulation of wealth by the time that he would otherwise have died”(per Bokhary, PJ [2001] 1HKLRD 193 at 202A-B).

79. Thus in this case, my task is to assess, on the evidence, whether the plaintiffs are able to prove by virtue of the operation of the MPF Scheme and the paid up equity of the matrimonial home that the deceased would have achieved an accumulation of wealth by the time of his notional date of death by natural causes. 

80. The MPF Scheme and the equity of the matrimonial home are being relied on by the plaintiffs as evidence to support the plaintiffs’ claim for the loss of an accumulation of wealth.  The plaintiffs do not claim for the loss of their actual value.  I shall deal with each of these two items claimed by the plaintiffs in support for the loss of accumulation of wealth.

(C)  MPF Scheme

(a)  The nature of the MPF Scheme

81. The MPF Scheme came into force on 1 December 2000.  The impact of the MPF on the accumulation of wealth has not found its way in any binding judicial precedent on this court save that Bokhary PJ in Lam Pak Chiu stated, obita, “  … On the one hand, the scheme may somewhat diminish what people will tend to accumulate during their working years.  On the other hand, any receipt under the scheme would swell or form the wealth of the deceased in question.  And the scheme is after all designed to make people better off at the end of their working lives than they otherwise have been.” (see [2001] 1HKLRD193 at 204C-E).

82. In this assessment, no evidence has been adduced on the investment pattern of the MPF and on how the different types of investments, whether they are conservative or speculative, would impact on the contributions under the MPF Scheme.  This lack of evidence on the investment pattern has led Mr. Hemmings to criticize the plaintiffs’ claim for accumulation of wealth saying it is speculative. 

83. The starting point in my view is to consider whether the nature of the MPF Scheme permits an employee to accumulate greater wealth than he would have otherwise been able to.  According to the preamble of the Mandatory Provident Fund Scheme Ordinance (Cap. 485), the purpose of the scheme is for, inter alia, “funding benefits on retirement, to provide for contributions to such schemes…” The operation of the MPF Scheme, simply put, is a scheme compelling an employee as well as his employer to contribute towards a retirement fund, which fund will be invested in the course of an employee’s working life. Upon the retirement of an employee, a capital sum representing all the investment gains or losses from the contributions received during an employee’s working life under the MPF Scheme will be paid to him.  

84. In this case, the deceased does not seem to have any obvious savings pattern. Hence, without the MPF Scheme, the deceased would be less likely to amass enough savings of any meaningful value upon the notional date of his retirement.  The main objective of the MPF Scheme is to provide a retirement fund to employees like the deceased who, without a compulsory retirement scheme, would otherwise not have the ability or the inclination to save for their retirement. 

85. In the absence of any evidence to the contrary, I am inclined to follow the observation of Bokhary, PJ in Lam Pak Chiu in paragraph 81 above and infer on the balance of probabilities that the deceased but for the negligence of the Defendant would have accumulated some wealth from the MPF scheme upon the notional date of his retirement.

(b)  The likely amount of the MPF received by the deceased at the end of his working life but for the accident

86. Any assessment of damages on the basis of some hypothetical accumulation is not just taxing but extremely difficult owing to the inherent uncertainty of such claim.  I cannot do it better than quoting from Bokhary PJ in Lam Pak Chiu of his remark on the difficulty of such task, “ … the court is often heavily engaged in pondering the well-nigh imponderable. It is often driven close to crystal-gazing.  All of these difficulties are in full attendance where the assessment of an award for loss of accumulation of wealth is concerned. But the mere fact that an assessment is extremely difficult does not relieve the court of its duty, or deprive of its ability, to make that assessment.  The court, in the time-honoured expression, does the best it can with what it has” ([2001] 1HKLRD193 at 202 E-G).

87. Thus, I shall now, doing the best I can, estimate the rough amount of the funds the deceased would have likely received from the MPF Scheme upon his notional date of retirement which I find should be at the age of 60 or slightly beyond.

88. The amount of the contributions from his employer, according to Mr. Bharwaney’s calculation, is around $360,000 to $380,000, which amounts are calculated by applying a working life multiplier of 14 to the 10 percent contributions from the employer. Based on this estimation, Mr. Bharwaney submitted that the value of the MPF upon the deceased’s retirement should not be less than $500,000.

89. Mr. Bharwaney’s said calculation, according to my understanding of the mechanism of the MPF Scheme, has one fundamental flaw, that is, he has failed to take into account the deceased’s own contributions, which he would be compelled to make by law.  The inclusion of the deceased’s own contributions for the purpose of calculating the amount of the total MPF contributions does not result in double-compensation.   As the inclusion is only for the purpose of estimating the total amount of the MPF but not the actual loss of the accumulation of wealth, there is therefore no issue of overcompensation. Thus, the deceased’s 10 percent contributions should also be taken into account for this purpose.

90. The deceased would be 47 on the date of trial if he had lived and would have retired at the age 60 or a little bit beyond.  After his retirement, he would probably have another 15 to 20 years to live.    Applying a 10 percent contribution to the median I have earlier adopted to calculate the deceased’s pre-trial earnings to the MPF contributions, the total contributions would be $96,600 ($21,000 x 10% x 46 months (i.e. from 1 December 2000 to trial in September 2004) and the post-trial figure, basing on the multiplier of 13, would be $187,000 ($17,000 x 10% x 110 months (13 years – 46 months)).  These two sums produce a total of  $283,600.  Thus, the MPF contributions comprising the deceased’s and his employer’s contributions would have been about $567,000.

91. This sum of $567,000, in all likelihood would be invested and swelled from any investment gains. In the absence of better evidence, I am prepared to accept the sum of $800,000 as pleaded in the Revised Statement of Damages as the amount of the total funds the deceased would have likely received upon his notional date of retirement but for the accident. I am satisfied that the deceased would have been achieved an accumulation of wealth in the sum of about $800,000 by the notional time of the deceased’s retirement.

(c)  Would the sum of $800,000 be totally depleted upon the date of the deceased’s death from natural causes?

92. This sum of $800,000 accumulated by the deceased upon his notional date of retirement however does not represent the loss of the accumulation of wealth. I am required to decide “the loss of what would have passed to the deceased’s estate upon his death after having lived out an average life span.” (per Bokhary PA, [2001] 1HKLR at 204).  Hence, to enable me to find an award in favour of the plaintiffs, I need to be satisfied that it is more likely than not that the lump sum of the MPF which the deceased would have received upon his retirement would not totally be diminished upon the date of his notional death had he not died.  This involves a finding on whether the gross sum of $800,000 would be totally exhausted by the deceased upon his death by natural causes.  This exercise would require a working out of the deceased’s expenditure and income generated from the sum of $800,000.

93. The court seems to be in favour of presuming, in the absence of evidence to the contrary, that such wealth accumulated would yield income - whether such income is in the form of rent, dividends, interest or anything else- during the retirement years. (per Bokhary PA, [2001] 1HKLRD 193 at 205 E-F).  In this claim there is no evidence to the contrary, I will therefore assume that the sum of $800,000 would generate income during the deceased’s retirement years. In Lam Pak Chiu. Bokhary, PJ set out four possibilities, which may assist a court to determine if a deceased is able to sustain the wealth he has accumulated from his working life before his notional date of death.  The four possibilities are:

(i)	expenditure during retirement may exceed the income from the accumulation … so as to exhaust the accumulation some time before the notional time of death, thus leaving the deceased dependent upon state, family or other help during his notional final years; or
(ii)	post-retirement expenditure may exceed post-retirement receipts but only so as to diminish the accumulation without exhausting it; or
(iii)	such receipts may more or less match expenditure so as to leave the deceased’s financial position at the notional time of death much the same as it has been at the notional time of retirement; or
(iv)	it may even be that such receipts would exceed such expenditure so as to leave his financial position better at the notional time of death than it had been at the notional time of retirement. (See [2001] 1HKLRD 193 at 205F-I)

94. As there is no evidence on the likely expenditure of the deceased after his notional date of retirement, I am inclined to adopt the approach expounded in Lam Pak Chiu by selecting a more realistic possibility applicable to the deceased’s situation. When the deceased received the lump sum from the MPF Scheme, it is likely that he would have invested the fund in order to generate income.  On the evidence, I find it unlikely that the deceased would engage in any high-risk investment.  Rather, I think it is more probable that he would choose the most conservative form of investment by putting the lump sum into a savings deposit to earn interest.  Thus the income that could have been generated from this fund would be extremely small, probably at around $1,000 to $3,000 per month, depending on the rate of interest at the time.

95. Upon his retirement, I find that it is likely that apart from his wife, all the dependency would have ceased.  He would then live in retirement with his widow in the mortgage free matrimonial home.  On the evidence, I accept that the widow and the deceased during their joint lives had led a rather hardworking and simple life like any other working class couple.  I am inclined to find that the deceased and his wife would have continued to lead a simple and frugal life without any wasteful indulgences.  As to the question of whether the children would have financially supported the deceased and the widow, I find that there is little prospect of any financial support from the second son in view of his irregular employment pattern.  On the other hand, it is observed that the eldest son has been a responsible son as evidenced by his financial contributions that he has made to the widow and grandmother since his employment with the Kowloon Motor Bus Company.  In view of the present living arrangement, it is also likely that the eldest son would have continued to live with the deceased and the widow with his young family.  The eldest son would probably be taking care of most of the household expenses and provide some pocket money to the widow as a responsible and filial eldest child.  The likelihood of the youngest daughter’s ability to provide financial support, in view of her young age, is rather uncertain.  Doing the best I can, I am more inclined to find that her financial support would have likely be limited to contributions by way of pocket money to the widow.

96. Having taken into account the likely financial support provided by the eldest son and the daughter, the deceased’s own MPF contributions and the modest interest from the savings, I find that the deceased’s post-retirement expenditure would probably exceed the post-retirement income produced from the lump sum investment but only so as to diminish the accumulation without exhausting it. In my assessment, the deceased would probably exhaust a total of about $25,000 each year from the total capital sum he had received from the MPF.

97. I bear in mind that this figure I have found by itself is not based on any scientific calculation or actuarial evidence and inevitably bears the inherent weakness of being artificial.  Having borne these shortcomings in mind and carefully considered all the evidence, I am satisfied that the said figure is based on the inference I believe I can reasonably draw from the evidence.

98. Thus on the date of the deceased’s notional death at the age of around 80, he would have exhausted in a region of about $500,000, leaving a balance of about  $300,000.  This sum, after having been discounted by 30 percent for early receipt, I award a sum of $200,000 representing the loss of accumulation of wealth from the MPF’s contributions.

Matrimonial Home

99. In the Revised Statement of Damages, the matrimonial home was pleaded to support the plaintiffs’ claim that the paid up equity of the matrimonial home establishes the deceased’s pattern of savings. The court, it is submitted, can infer that the deceased would likely acquire a larger or second home by way of another mortgage loan upon the discharge of the mortgage loan. 

100. On the evidence before me, there is no dispute that before the deceased’s death, the deceased had paid for, if not all, the substantial part of the costs of the acquisition of the matrimonial home and the mortgage instalments.  After the death of the deceased, the widow had continued to pay the mortgage instalments with the monies she had borrowed from her sister and the sum of $135,000 received from the Traffic Accident Assistance from the Social Welfare Department.  In any event, the mortgage was completely discharged in or around January 2004.  On the evidence, I also accept that the deceased but for the accident would have continued to pay the mortgage instalments until the mortgage loan was fully repaid. 

101. After the mortgage was redeemed, had the deceased continued to live at the date of trial, on balance, there was still more than one dependent.  Realistically he would not have the financial means to acquire a second investment home or a bigger property until the cessation of the dependency of the daughter.  However, by the time the daughter would have become financially independent, it would be quite close to the deceased’s retirement and it is less likely that when one is approaching retirement one would seek to expand and stretch one’s resources.  Further, from my analysis of the evidence, the deceased is not a likely candidate to have either the means or the tendency to acquire a bigger or second home.  In my view, it is more likely than not that the deceased would have continued to reside in the matrimonial home until his natural death.  As the property was registered in the joint names of the deceased and the widow, the deceased’s interest in the property would be automatically extinguished so that the surviving joint tenant, the widow would have become solely entitled to the property, upon his death by the operation of the right of survivorship, which has in fact already taken place in the present case.  Thus the matrimonial home would not have formed part of the deceased’s estate.

102. After having considered all the evidence before me in particular the decision of Deputy Judge Lugar-Mawson as he then was in Dall v Choy Ying Wai [1999] 1HKLRD105 referred to in Lam Pak Chiu, I find that the value of the equity in this claim is insufficient to establish on balance a loss on an accumulation of wealth upon the deceased’s natural date of death.  The matrimonial home in this case is quite different to those properties being considered by the learned Judge in Dall, in which case the properties were acquired by the deceased substantially for investment purposes. 

103. In the circumstances, I am disinclined to find there is any loss of the accumulation of wealth arising from the equity of the matrimonial home.

(d)  Amount awarded

104. Having considered the totality of all the evidence in support of the plaintiffs’ claim for the loss of accumulation of wealth and everything that was submitted by counsel, I award a sum of $200,000 for the accumulation of wealth.

SUMMARY

(1)  Pre-Trial Loss of Dependency	$960,750
(2)  Post-Trial Loss of Dependency	$1,211,250
(3)  Loss of Services	$Nil
(4)  Loss of Accumulation of Wealth	$200,000
(5)  Bereavement	$150,000
(6)  Special Damages	$63,068
	$2,585,068

INTEREST

105. The question of interest is, by and large, not controversial.

106. In this assessment, I award interest on the pre-trial loss of dependency at half the judgment rate from the date of the issue of the writ to the date of judgment.

107. I award no interest for post-trial loss of dependency.

108. I award interest on damages for the loss of accumulation of wealth at judgment rate from the date of judgment until full payment, and further interest on bereavement at judgment rate from the date of the deceased’s death until the date of judgment and on special damages at half of judgment rate from the date of accident until the date of judgment.

109. I further order that interest shall run at the judgment rate from the date of judgment until full payment in respect of the damages on pre-trial loss of dependency, bereavement and special damages.

110. I leave the parties to calculate the amount of interest.

ORDER

111. There will be judgment for the plaintiffs for $2,585,068 with interest as awarded above.  I make a cost order nisi in favour of the plaintiffs with certificate for counsel, which costs are to be taxed if not agreed and the plaintiffs’ own costs be taxed in accordance with the Legal Aid Regulations.

112. I would like the plaintiffs’ solicitors to submit a memorandum of apportionment on damages for the court’s approval before damages are paid to the plaintiffs.

113. Lastly, I wish to thank both counsel for their assistance in this claim.

Appendix I

[1] Employees’ Compensation Ordinance (Cap.282), s.15, Employees Compensation Regulations, Form 2 “ Notice By Employer of the Death of an Employee or of an Accident to an Employee Resulting in Death or Incapacity”.

[2] Sarony, N., Q.C. (ed.), ‘Personal Injury Tables, Hong Kong’ (Sweet & Maxwell Asia, 2003), Table 19: Multipliers for Pecuniary Loss For Life (Males).