LAM WAI LING MAYME v. HUTCHISON TELECOMMUNICATIONS (HONG KONG) LTD

HCPI 461/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO 461 OF 2015

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D E C I S I O N

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1.  This is the defendant’s application for leave to withdraw a sanctioned payment of HK$63,000 before the expiry of 28 days from the date of payment in.

BACKGROUND

2.  This is a personal injury claim which commenced on 5 May 2015.  The Statement of Damages quantified the claim at some HK$3.48M.  The claim under “Future Loss of Earnings” was for HK$2.15M on the basis that “the plaintiff would not be able to resume her pre‑accident job or any similar employment in full capacity”.

3.  The corresponding Employees’ Compensation claim was settled shortly after commencement of the current action at HK$831,707.

4.  Medical experts in 3 specialty areas (neurology, ophthalmology and psychiatry) were instructed.  The joint neurological expert report (26 April 2014) predated the commencement of the current action.  The joint ophthalmology expert report was dated 22 December 2015 and the joint psychiatric expert report was dated 1 December 2015.  There was also a supplemental joint psychiatric expert report dated 10 June 2016.

5.  On 25 March 2016, the plaintiff obtained a “Form 1” from her treating doctor, Dr. Jonathan Wong, certifying that she was permanently unfit for work as a sale person.  This form was used for application for long service payment and thus not directly related to the current action.

6.  Five days later, on 30 March 2016, the plaintiff filed and served a Revised Statement of Damages quantifying the claim at over HK$5M (with the claim under “Future Loss of Earnings” for HK$3.65M).

7.  The plaintiff disclosed this “Form 1” in her 6^th List of Documents filed on 3 May 2016.

8.  On 3 November 2016, the defendant filed and served a Notice of Sanctioned Payment of HK$63,000 (on top of the EC claim already settled).

9.  On 14 November 2016, the plaintiff rejected the sanctioned payment and made a Sanctioned Offer of HK$380,000.

10.  On 16 November 2016, Labour Department wrote to the defendant on its ruling on the “Form 1” application:- “I have, after considering the advice of medical reports, come to the conclusion that the above-named employee is not entitled to a long service payment because she is considered not to be permanently unfit for the particular type of work she was engaged in.”

11.  On 21 November 2016, the defendant took out a summons to withdraw the sanctioned payment.

12.  The following is a series of “without prejudice” correspondence between the parties which were produced in court in the hearing bundle.  As no objection was raised by either party on production of such, the court would peruse such correspondence.

13.  On 21 November 2016, the defendant’s solicitors, Fairbairn Catley Low & Kong (“FCLK”) wrote to the plaintiff’s solicitors, Li & Lai (“LL”) inviting the plaintiff to consent to the withdrawal summons:-

“…In light of your client’s rejection, and the letter from Labour Department dated 16 November 2016 that the plaintiff is considered not to be permanently unfit for the particular type of work she was engaged in, we have on 21 November 2016 filed into the Court a Summons…we hereby seek your client’s consent for an order in terms of the Summons…”

14.  LL replied on 22 November 2016 agreeing to the proposed terms except a suggested amendment that the costs of the summons be agreed at HK$800.

15.  FCLK sent the Consent Summons with the suggested amendments to LL on 22 November 2016 for endorsement.

16.  LL did not reply to the letter.  Instead, on 25 November 2016, LL filed a Notice to Accept the Sanctioned Payment.

17.  As the defendant has already applied for withdrawal of the sanctioned payment, the plaintiff’s Notice of Acceptance will not take effect until the determination of the application.

THE LEGAL PRINCIPLE

18.  The principle is trite: the court has a complete discretion, to be exercised judicially, whether to allow a payment into court to be withdrawn.  The test is “whether there is sufficient change of circumstances since the money was paid in to make it just that the defendant should have an opportunity of withdrawing or reducing his payment”.  The court should also consider all the circumstances of the case including any delay, the conduct of the applicant etc. but the overriding consideration is to do justice between the parties (Polyever Holdings Limited v Savills (Hong Kong) Limited HCA 1039/2010 and Unistress Building Construction Limited v Humphey’s Estate (Forrestdale) Limited DCEC 1113/2013).

THE MATTERS IN DISPUTE

19.  Thus, the crux of this application is whether the letter from the Labour Department constituted a “sufficient change of circumstances” and what is “just” under the circumstances.

20.  Looking at the Revised Statement of Damages, it is clear that the most significant item which can potentially change the circumstances of the case are the claims for both pre‑trial and future loss of earnings at over HK$4.2M combined.  Thus, the crux is whether the plaintiff can establish that she “will not be able to resume her pre‑accident job or any similar employment in full capacity” as claimed.

THE DEFENDANT’S CASE

21.  Mr. Patrick Lim, Counsel for the defendant, went through all the expert opinion and submitted that all the experts were of the view that the plaintiff should have a short period of sick leave (ranging from 1 to 18 months) and that she could resume her previous job.  The only medical evidence that she could not resume her pre‑accident job was from Dr. Wong in Form 1.

22.  The defendant thus made the sanctioned payment to protect its position on the “off‑chance” that the court might favour the evidence from Dr. Wong albeit that he was not one of the experts.  He submitted that this was a reasonable step for the defendant to protect its position on costs.

23.  However, once the Form 1 was out of the picture, even on full liability, the claim would not exceed HK$831,000, the sum she had already received from the EC claim.

24.  This, according to Mr. Lim, was a “sufficient change of circumstances” not only for the defendant but for the plaintiff, who changed her mind from a sanction offer of HK$380,000 to accepting HK$63,000 in a matter of days.

25.  To allow the plaintiff to accept this sanctioned payment now would mean that the plaintiff, having brought an extravagant claim of HK$4.7M, would end up with HK$63,000 and be awarded the costs of the action.  This would be an unfair situation.

THE PLAINTIFF’S CASE

26.  Mr. Ernest Ng, the Counsel for the plaintiff, drew the court’s attention to the authority of Rai v Pacific Construction (HK) Co Ltd HCPI 398/2008 (Bharwaney J’s Judgment).

27.  Although there was no objection by either parties producing the without prejudice correspondence, I would accept that “the provisions under O.22 are entirely procedural in nature and that they are not affected by the general law of contract” (per Bharwaney J’s Judgment at paragraph 20).

28.  As such, the fact that the plaintiff initially agreed to the consent summons for withdrawal of the sanction payment should not be viewed as anything constituting an acceptance of an offer from the defendant.

29.  Mr. Ng also refer to paragraph 32 of the judgment : “The relevant factors must vary from case to case.  In considering these factors, the court must not lose sight of the fact that the objective of O. 22 is to promote settlements, save costs, and avoid the uncertainties of litigation.”

30.  I would agree with Mr. Ng, but Bharwaney J then went on (in paragraph 33): “The main criteria must be whether there has been such a change of circumstances as would render it unjust to allow the offeree to benefit from the offer.”

31.  It is clear that the objective of “promoting settlement” must not override the “main criteria” including the need to do justice between the parties.

32.  The purpose of allowing the plaintiff 28 days to accept the payment is, amongst others, to allow “any consequential investigation into his own case before making a final decision to accept the offer” (Hong Kong Civil Procedure 22/7/A Note 1).  Mr. Ng argued that the defendant has taken the risk of making the sanctioned payment knowing that the Labour Department’s decision could come anytime.

33.  Mr. Ng also made the point that treating doctors were not considered medical experts and “the opinions expressed by the treating doctors in their report are not admissible as expert evidence unless leave to admit it for that purpose has been obtained from the court.” (Hung Sau Fung v Lai Ping Wai [2012] 1 HKLRD).

34.  Mr. Ng submitted that the plaintiff did not rely on Form 1 to increase her claim in the Revised Statement of Damages: paragraph 7.1 of the RSOD on the claim of future loss of earnings reads:

“Given the residual visual disabilities and other psychiatric symptoms as a result of the accident, the plaintiff will not be able to resume her pre‑accident job or any other similar employment in full capacity after the notional date of trial.”

35.  According to Mr. Ng, by mentioning “visual disabilities” and “psychiatric symptoms”, the plaintiff was clearly relying on the expert opinions of the ophthalmologists (regarding the plaintiff’s difficulties in near-vision and eye strain etc.) and the psychiatrist Dr. Ng Wai Man Stephen, and not on any “opinion” of Dr. Jonathan Wong in Form 1.

36.  Mr. Ng further submitted that the defendant had applied for the ruling of Labour Department so the decision was not so unexpected, although he accepted that the ruling could go either way.  He emphasised that the purpose of the ruling was for the right to long service payment (under section 31R of the Employment Ordinance cap 57) and not for medical assessment purposes.

37.  In short, Mr. Ng submitted that this was not a change of circumstances, or not one that “puts a wholly different complexion on the case” (as per Anthony Chan J in the Polyever case).

DECISION

38.  Mr. Ng sought to convince the court that the Revised Statement of Damages was not based on Form 1.  Whilst I agree that the Revised Statement of Damages did not rely on the “opinion” of Dr. Jonathan Wong as to whether the plaintiff was “permanently unfit for her job”, we must bear in mind that:-

“A report of a treating doctor is always admissible to prove the fact that the injured person was receiving treatment, the nature of that treatment, and the opinion and diagnosis of the treating doctor which was communicated to the injured person.” (per Bharweney J in the case of Hung Sau Fung).

39.  As such, Form 1 can still be admissible to prove the fact that the plaintiff has continued to suffer from “headache, dizziness and visual blurring” (the “opinion and diagnosis of the treating doctor” as communicated to the patient) and has sought treatment from Dr. Wong for that.

40.  This is of great significance for the plaintiff’s claim. Dr. Liang, the ophthalmology expert, opined on page 8 of the joint expert report that :-

“Ms. Lam has persistent symptoms of headache, nausea with photophobia on focusing near objects. Ms. Lam is suffering from Post Concussion Syndrome. This syndrome is common after head injury and patient will complain of headache, nausea with blurred vision. From the ophthalmological point of view, Post Concussion Syndrome patient frequently presents with loss of focussing and visual disturbance…They are symptoms of…impairment of central nervous system….Usually the symptoms will improve overtime but occasionally it can linger on for years.”

“Ms. Lam has not returned to her job…It is mainly due to her neurological problem. From an ophthalmological point of view, the visual disability was not significant. She might have to rest frequently…but she can return to her job as saleslady.”

41.  It is clear that the plaintiff wishes to rely on such expert opinion since the same was quoted in paragraph 2.4(e) and (somewhat selectively quoted) in paragraph 2.4(i) of the Revised Statement of Damages.

42.  Thus, the continual presence of “headache, dizziness and visual blurring” as submitted in Form 1 would help establish that the Post Concussion Syndrome (which was, according to Dr. Liang, an “impairment of the central nervous system” or a “neurological problem” causing, amongst others, visual disabilities) has “lingered on for years”.

43.  In turn, this can support the claim that the plaintiff cannot resume her pre­accident job “for years” and thus the claim for loss of earnings for those years.

44.  I have no doubt that this was on the plaintiff’s mind. When I asked Mr. Ng what was the purpose of the plaintiff presenting the Form 1 in this case (given that it was for an application for long service payment), he admitted that this was a “relevant document from a treating doctor” but whom the plaintiff was not relying upon as an expert.

45.  It was perhaps telling that Mr. Ng later sought to downplay the relevance of the Form 1 when he argued that there was no significant change of circumstances when the Labour Department rejected it.  Mr. Ng could not argue both ways that “this was a relevance document from a treating doctor” when seeking the justification to submit it, and then downplay its relevance when the same was rejected by the Labour Department.

46.  I will now turn to the significance of the ruling of the Labour Department.

47.  I entirely accept that this court is not bound by any ruling of the Labour Department. This court need not be concerned about how that decision was made.

48.  Mr. Ng submitted that this was not a “discovery of further evidence which put a wholly different complexion on the case”.

49.  However, this was just one example given by the judge in the Polyever case for the “change of circumstances” test.

50.  In applying what is a “change of circumstance”, the court would assess what is “just” in each case on its own circumstances, including the reasons for the sanctioned payment and the amount paid.

51.  There may be many reasons why a sanction payment is made: on one end of the spectrum, the paying party may realise that he has a bad case and wants to encourage an early full settlement. On the other end, a party may wish to err on the side of caution and pay a small amount to cover himself even in a good case.

52.  I imagine that for the “bad case” end of spectrum, it will only be “just” if the court allows the withdrawal of the sanctioned payment when there is further evidence which “puts a wholly different complexion on the case”, for example, dramatic evidence turning a “bad case” to a “good defensible case”.  On the other end of the spectrum, if the sanctioned payment is intended to cover a small or theoretical risk, any evidence that may add weight countering that small risk may suffice as a “change of circumstances”.

53.  In this case, we must bear in mind that the defendant only made a very small sanctioned payment, a mere HK$63,000 in comparison to the overall claim of HK$4.7M.

54.  This was clearly an attempt to cover a small risk of litigation: the presence of Form 1 with the “dissenting” opinion of a few experts compared to the overall opinion of all the remaining experts.

55.  This small risk would be the “off chance” that the court might accept Dr. Liang’s expert opinion and Dr. Wong’s factual evidence, and find that the Post Concussion Syndrome has “lingered on for years” and, as such, allow more substantial awards under loss of earning claims.

56.  I do not think that the defendant has put any weight on the risk that Dr. Wong’s “opinion” that the plaintiff was “permanently unfit for her job” would be accepted as expert opinion.  Otherwise I would expect a more substantial sanctioned payment.  But as stated above, there is a small risk of the court finding loss of earnings for a few years.  It is not unreasonable for the defendant to assess that this might push the quantum to slightly beyond the EC award thus necessitating a small sanctioned payment just to err on the side of caution.

57.  In such circumstances, there may not be a need for any evidence to “put a wholly different complexion on the case”, but any evidence that may tilt the balance more against the small risk may suffice.

58.  I am of the view that the ruling of the Labour Department is important in this aspect.  The purpose of the Form 1 was to apply for long service pay.  That application has failed so the form has now lost its purpose.  This would render the document even more irrelevant in the current case.

59.  Conversely, I would imagine that if the Labour Department found that the plaintiff was entitled to long service pay, the plaintiff would no doubt argue for the significance of the Form 1.

60.  As a passing comment, I agree with Mr. Lim that this may appear to be an extravagant claim in view of the seemingly overwhelming opinion of the vast majority of the experts.  Many of the expert reports were available before the commencement of the action but the plaintiff maintained and even increased her claim in the Revised Statement of Damages.

62.  An important purpose of requiring a party to sign a Statement of Truth in pleadings like the Revised Statement of Damages is to discourage overtly unrealistic claims which only serve to delay settlement and increase legal costs and time.  It is certainly of concern to the court that the plaintiff, having certified the truthfulness of what is pleaded, is then prepared settled at just 1.3% of her claim.  This raises some suspicion that the claim has all along been an overtly unrealistic “try‑on”.

63.  If this is true, then the Form 1 was no more than an opportunistic move to support the “try‑on”.  The plaintiff’s claim, even on her best case scenario (i.e. on proving that she suffered from Post Concussion Syndrome which has “lingered on for years”), would not have come anywhere near the HK$4.7M claimed.  This perhaps calls into question the conduct of the plaintiff.

64.  Nevertheless, I am not conducting a mini-trial of the claim and there can be many reasons why a plaintiff may choose to settle.  Any suspicion on the conduct of the parties is not a factor for consideration in my decision.

65.  Given the circumstances of this case, it is clearly just to allow the defendant to withdraw its sanctioned payment.

ORDER

66.  I will give the following orders:

a)  Leave for the defendant to withdraw the Notice of Sanctioned Payment dated 3 November 2016;

b)  The sum of HK$63,000 paid into the Court by the defendant by way of Sanctioned Payment on 3 November 2016 be paid out forthwith to the defendant through their solicitors Messrs. Fairbairn Catley & Kong;

c)  Any interest accrued on the Sanctioned Payment shall be paid out to the defendant through their solicitors Messrs. Fairburn Catley Low & Kong; and

d)  There be no order as to costs.