LEE YUK YUNG AND OTHERS v. YEUNG KWOK KEUNG AND ANOTHER

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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BETWEEN

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JUDGMENT

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1. The Plaintiffs are the administrators of the estate of CHEUNG Yuk-keung who died intestate on the 22nd September 1979 in a traffic accident. They bring this action on behalf of the estate of the deceased under the law Amendment and Reform Consolidation Ordinance (Cap. 23) (LARCO.) and on behalf of the widow LEE Yuk-yung (P.W. 5) and her five children under the Fatal Accidents Ordinance (Cap. 22) (FAO).

2. The facts fall within a narrow compass. At about 5 p.m. on the 22nd September 1979 YEUNG Wah-yat (P.W. 1) drove his container trailer BZ 1337 to milestone 9½ in Castle Peak Road and parked it facing Kowloon on the pavement outside the Nam Hoi Textile Company to collect a load of cotton wool bales. He had been hired by the Man Sang Transportation Company, working for which was the deceased as a coolie and his younger brother CHEUNG Yuet-ming (P.W. 2) as in charge of the goods section. P.W. 2 asked the deceased to go to the driver to mark the arrival time on the container truck papers which were with the driver. The deceased started walking on the pavement in the space between the container trailer and the kerb but, before he reached the driver, P.W. 2 heard a bang and saw his brother being pushed by a goods vehicle, which it is admitted was BK 9458, to the safety rail of the container. He said that this vehicle moved forward and eventually stopped. P.W. 1 said that he heard a scream from the offside of his trailer and on looking out backward he saw the man leaning against the middle part of his trailer. He said that the victim, who was bleeding profusely from his head, was on the pavement with his legs on the kerb.

3. The deceased sustained various abrasions, lacerations and fractures including that of the frontal bone of the skull. He died the same day and the cause of death is stated in the Post-mortem report as "fracture skull and subarachnoid haemorrhage".

4. The Plaintiffs maintain that at the material time the goods vehicle was owned by the second defendant (D.W. 3) and was driven by the first defendant (D.W. 1) as his servant or agent in a negligent manner. Besides the usual particulars of negligence which are pleaded such as failing to keep a proper look out or giving a warning of his approach or slowing down to avoid the deceased, it is averred that the first defendant drove at a speed which was excessive in the circumstances and that he mounted the pavement.

5. It is admitted that the first defendant was the driver of the goods vehicle at the material time. The accident in which the deceased was struck by this vehicle is admitted also but negligence on the part of the first defendant is denied. Both defendants maintain in their respective defences that the accident was caused wholly or in part by the negligence of the deceased who is accused by the first defendant of :-

6. In paragraph 4(a) and (b) of his defence, the second defendant repeats the particulars set out above in (a) and (c). Paragraph 4(c) reads :

"                 Walking too close on the  nearside of the road on  the offside of a container truck parked on the pavement."

7. In the alternative, both defendants raise the plea of unavoidable accident, and the second defendant denies that at the material time he was the owner of the goods vehicle or that the first defendant drove it as his servant or agent.

8. For some reason TANG Chung-wah has continued to appear in the title of these proceedings as a third defendant. He was joined as a defendant pursuant to a order of a Master on the 17th September 1982, on the basis that on the 28th May 1979 the second defendant had sold the said vehicle to him, although the transfer was not registered. Subsequently, however, on the 3rd May 1985 MANTELL, J. set aside the service of the writ on the third defendant and on the 29th August 1985, the Plaintiff obtained leave of a Master to discontinue the action against him. A notice of discontinuance was filed on the 5th February 1986. TANG Chung-wah was called by the first defendant as a witness and is D.W. 2. He admitted that he was in the goods vehicle as a passenger at the time of this accident.

9. PC 8600 (P.W. 6) who visited the scene found that the goods vehicle had been removed from the road to the pavement. He made a sketch plan - Ex. P3 - of the scene, assisted by the first defendant in taking the various measurements therein stated. The significant features noted by the constable are the tyre marks measuring 3 metres on the kerb; a pool of blood, partly on the pavement and smaller quantity on the road, 1.40 metres from where the tyre marks on the kerb terminated and some brake marks in the nearside carriageway starting from the front part of the container truck, the nearside brake mark measuring one metre, the offside measuring 5.6 metres. The distance between the offside edge of the container and the kerb is given at 0.8 metre.

10. The deceased's brother said that after he told the deceased to go to the driver, he saw him go to the right side of the trailer, while he himself stayed at the rear of the container inspecting the goods. P.W. 2 said that the gap between the container and the kerb, that is, 0.8 metre as the constable noted, was such than someone could have walked easily on the pavement. The first defendant said in cross-examination that it was too narrow to accommodate him and, having said that the deceased was by the kerb before the impact, he said,

11. Yet, to Mr. Mitchell (for the Plaintiffs) he said that he did not see the deceased when he struck him. In answer to a question from the court, the first defendant said categorically that he did not see the deceased at all before the accident, but his passenger saw him coming out. This confusion in his evidence necessitates a reference to his cautioned statement to the police which he made on the same day at 9:10 p.m. This statement was read out to the first defendant twice at different stages of the trial and he confirmed under cross-examination to Mr. Mitchell that it was true. In it he is recorded as having said,

12. It is reasonable to say that the passage of some years since the accident may have dimmed his memory. Besides what he said in his statement, there is the evidence of his passenger who said of the deceased :

13. On this issue of the deceased's position just before the accident I find that the defence case shows clearly that he was on the pavement in the gap between the container and the kerb, and the weight of the evidence indicates that he did not step into the road before he was knocked down.

14. The first defendant disagreed with the evidence of the deceased's brother that he was doing at least 50 M.P.H. He maintained that his speed at the time of the accident was 30 M. P.H.  P.W. 2 had been a driver for some ten years and his estimate of the speed was based on what he described as : "The vehicle came just like wind." Under cross-examination he agreed that his belief that the vehicle was travelling very fast was because of the loud bang that he heard. I do not think that, in the circumstances, any reliance can be placed on the estimate of speed given by P.W. 2. From the sketch plan is missing the measurement from the start of the tyre print along the kerb or from the pool of blood to the brake marks where the goods vehicle came to a stop. The omission precludes any calculation of speed based on the stopping distance table. Thus, there is only the uncontroverted evidence of the first defendant that he was doing 30 M.P.H.

15. D.W. 2 explained how the accident happened. He said that when they were near the Nam Hoi Textile Factory, the vehicle moved to the kerb due to the uneven road surface. The first defendant swerved out into the other carriageway and because of an oncoming public light bus, he swerved back to the original carriageway and struck the deceased who was then standing by the kerb. The first defendant's account of the accident is contained in his cautioned statement, wherein he said,

16. As I have said earlier, the first defendant confirmed that this statement was true. The account of the only other eye-witness, who was a front seat passenger in the vehicle, is identical to what the first defendant has said in his cautioned statement. Under cross-examination  he said that he felt that the wheels of his vehicle "brushed" the kerb. Whether they "brushed" or "ran along the kerbside", they left their mark on the kerbside which the police constable saw and marked on his sketch plan.

17. The defendants thus blame the uneven road surface for their vehicle swerving to the nearside. The first defendant said in his cautioned statement that he was "familiar with the roads in the New Territories, including the place of occurrence of the accident." I think that it would be reasonable to say therefore that he was familiar also with the uneven surface on that stretch of the road. In the circumstances, a prudent driver approaching that section of the road would be expected to exercise such care as will take him over without creating a danger to the other road users including, inter alia, to reduce his speed. There is nothing in the evidence to show that he reduced his speed and the fact of maintaining the same speed, which he said was 30 M.P.H., and the vehicle swerving to the nearside, indicates to my mind two inferences which can reasonably be drawn : first, that the speed of 30 M.P.H. was excessive in the circumstances of which the first defendant was aware, namely, the uneven surface, the presence of the other road traffic in the other carriageway as well as that of the pedestrian on the pavement by the kerbside; secondly, that he failed to keep proper control of the vehicle both at the time the vehicle swerved first and subsequently in attempting to correct that initial swing. In the event, I do not think that the plea of unavoidable accident will avail him, and I reject it.

18. I have held that the deceased was on the pavement when he was hit by the goods vehicle. The first defendant denies that the vehicle ever mounted the pavement, but admits that the nearside wheels brushed against the kerb which is supported by the tyre marks left on the kerbside. The defence evidence indicates that it was at this juncture that the deceased was struck. It is obvious that at the point in time when the nearside wheels of the vehicle were in contact with the kerb, part of the vehicle, more particularly the front nearside with the rear view mirror on it which is the part that struck the deceased according to the driver, must have reached beyond the kerb to the extent of catching the deceased. In Laurie v. Raglan Building Co., Ltd. (1942) 1KB 153 it was held that in considering whether a prima facie case of negligence has been established, no distinction is to be drawn between a case where the wheels of a vehicle actually mount the pavement and one where part of the vehicle overhangs and sweeps across the pavement. Lord Greene M.R. said at F. 154 :-

19. This case has been applied in LAM Shui-tsin v. James FONG (1974) H.K.L.R. 357.

20. Considering the evidence in its entirety, I find that it preponderantly proves the negligence of the first defendant in driving the goods vehicle which struck and killed the deceased who in no way contributed to the accident.

21. The next issue concerns the vicarious liability of the second defendant for the negligence of the first defendant. Admittedly he was the "owner" of this goods vehicle up to the 28th May 1979, and it is not disputed that it was on hire purchase with the United Merchants Finance Ltd. According to the agreement, the second defendant was to pay the hire purchase price by eighteen monthly rentals of $970.80 commencing from the 2nd January 1979 and thereafter on the 2nd of each month. He maintained that he had paid the first five rental instalments and on the 28th May sold the vehicle to TANG Chung-wah (D.W. 2), when the following document was written on the letter head of Wing Kee Motors Co., of which D.W. 4 is. the owner :

22. According to these witnesses the formalities that were completed were that D.W. 4 explained to them the procedure that was to be followed, that is, the buyer would have to pay a service charge of $500.00 to the finance company together with a payment of three months' rentals, following which the vehicle would be registered in the purchaser's name who would then take over the remaining ten rental instalments. D.W. 2 paid $6,000.00 to the second defendant who handed over the transfer form and the car keys to the buyer. The second defendant maintained that it was agreed that the transfer of ownership would be registered within a month, for which period the second defendant agreed to provide insurance cover to the buyer only in his capacity as the second defendant's permitted driver. D.W. 2 however said that the second defendant was to remain as the registered owner for the whole of the instalment period. The second defendant agreed under cross-examination that the agreement was that whenever the purchaser had enough money he would proceed to have the transfer of ownership made.

23. Although the document which was signed on the 28th May does not identify the vehicle to which it referred, the signatories and D.W. 4 confirmed in evidence that it was in fact the goods vehicle BK 9458. I find that, irrespective of the conditions which were or might have been agreed between the parties concerning the transaction, there is ample evidence, which was indeed admitted by all hands, that D.W. 2 took delivery of the vehicle, hence its physical possession, on the same day. It was submitted by Mr. Mitchell, however, on the authority of NG yat-ying v. LAM Ming-kwan, (1984) H.K.L.J. 242, that the intention of the parties in this case was that property in the vehicle would pass only upon full payment when registration of the transfer of ownership would take place, and I was invited to say that, there being no evidence to show that by the day of the accident the agreed number of instalments - be they three or thirteen - had been paid to the finance company, property in the vehicle could not have been passed to the purchaser. Mr. LEE argued that the case cited was distinguishable on facts in that there the seller was the legal owner, whereas in the present case the seller was only an equitable owner so that upon the agreement to sell only the equitable ownership passed to the purchaser.

24. In the case of NG Yat-ying the issue of whether property had passed to the purchaser arose with regard to the effectiveness of the third part insurance policy. With respect, I think that I must decline Mr. Mitchell's invitation for the simple reason that in my view the issue of vicarious liability with which I am confronted does not turn on whether property in the goods vehicle had passed to the purchaser at the time he took delivery thereof, nor am I concerned as I see the problem with the rights of the legal owner under the hire purchase agreement vis-a-vis the hirer and the purchaser. That seems to me to be irrelevant to the central issue so that, in my opinion, as between the second defendant as bailee and the purchaser (who is D.W. 2), the legal ownership of the vehicle in the finance company remaining constant, the issue must turn solely on the question of which of the two had the possession and control of that vehicle at the time of the accident. This will narrow the issue down to this : whether the second defendant retained both a right to control the use of the vehicle and an interest in the purpose for which it was used. This may be illustrated by reference to the summary of the law in this regard in Clerk & Lindsell on Torts, 15th edn., paragraphs 3 - 16 (at P. 168) where it is submitted that :

25. I should also refer to the unanimous decision of the House of Lords in the cause celebre, Launchbury v. Morgans, (1973) A.C. 127.

26. As I have pointed out already, on the 28th May 1979 the purchaser took possession of the vehicle for use, as he put it. There is no evidence either directly from the second defendant or the purchaser as to whether the second defendant had retained to himself any control over the purchaser's use of the vehicle. Because of the absence of such evidence and also because the second defendant had handed over the payment slips for the monthly instalments to the purchaser at the same time, which was admitted, I am led to the conclusion that the probability was that the purchaser, that is D.W. 2, was to have the sole and exclusive possession and control of the vehicle. That was the position, as I view the situation, on the day of the accident. The fact that the vehicle was on that day still registered in the name of the second defendant does not, in my opinion, affect that position in any way.

27. Turing now to the status of the first defendant who was the driver at the material time, Mr. Michell concedes that he was not a servant of the second defendant. But he seeks to prove that the driver was his agent on the basis that he gave possession of the vehicle to D.W. 2 so that the purchaser would earn money and pay off the hire instalments, and he argued : "The first defendant was directly driving on the instructions and on behalf of Mr. Tang, but I say that the second defendant had an interest in that, a direct financial interest. Therefore, indirectly the first defendant was driving on behalf of the second defendant as agent."

28. Mr. Lee submitted that the law of agency could not be stretched thus far. He said that if a principal is to be bound, the agent must act within the scope of his authority recognised by the principal who could not be held liable for the action of an "unknown agent".

29. There was evidence that the second defendant did not know the driver before the accident, and I find no evidence that he knew what the purpose of that journey was. Whereas the financial interest on which Mr. Mitchell relied may have remained, it was in my view essentially similar to the corresponding interest of the finance company who could not on general principles be saddled with vicarious responsibility for the negligence of the hirer as bailee. All that can be said of both, that is, the second defendant and the finance company, is that there was a simple permission to drive which, it is established, is not enough to create vicarious responsibility for negligence. Authority for this is to be found in a number of cases which are mentioned in Launchbury v. Morgans (supra). I need only cite from the speech of Lord Cross of Chelsea at P. 144, where he said,

30. Having found that the purchaser was to have the sole and exclusive possession and control of the vehicle, it must follow that that would be the end of the matter. However, if I were to go by the evidence concerning the period during which the transfer was to be effected and the insurance cover, regarding which there is a direct conflict in the testimony of the second defendant and the purchaser about its scope and the period for which it was to last and not having had the benefit of being referred to the details of the insurance policy, I would have preferred the version of the second defendant as the more reasonable and probable in the circumstances of their deal concerning the sale of the vehicle. The fact that the insurance cover was for the purchaser only as his permitted driver for the period of one month indicates to my mind that the parties expected the registration of the transfer to be completed within that period. I am of the opinion that the maxim deleaatus non potest delegate would apply and the purchaser could not except with the express or implied assent of the principal delegate his authority. There is no evidence than the second defendant, who did not know the driver before the accident, had assented to his driving the vehicle, nor is there anything to indicate that he knew of the purpose of the user for which the vehicle was being used on the day of the accident so that his assent could be implied for the first defendant to drive it on that day. Certainly there is nothing to attribute to the second defendant any request to D.W. 2 to use the vehicle in the way it was being used that day.

31. For these reasons, I find that the second defendant is not vicariously liable for the negligent driving of the first defendant and the action against him is dismissed with costs.

32. With regard to the damages, it was suggested that for a man of about 40, a multiplier of 13 would be appropriate. Mr. Lee said that in view of the fact that the nature of his job called for greater physical strength and taking into account the evidence of the employer that a man of over 40 would fall in priority when there was no market shortage for coolies, a multiplier of 10 would be more appropriate. The deceased had worked for the same employer for two to three years before the accident and his employer said nothing about his services that might indicate that the deceased would have been replaced. I do however accept that as his age increased, the deceased might have found it progressively difficult to cope. This would apply to almost any kind of  job but I should have thought that he would have continued in his chosen occupation of a manual worker at least for the next fifteen years without the age factor impeding his performance too greatly. I am inclined to accept the multiplier of 13.

33. The deceased's brother (P.W. 2) said that in 1979, he was earning $2,400.00 per month and the deceased earned on average $2,100.00, indicating a difference of $300.00. The employer said that the deceased's earnings at the time of his death amounted to $2,00.00. Under cross-examination he was asked :

34. Mr. Lee took this to mean that the employer had backed down from his original evidence about the deceased's earnings being $2,900.00. Mr. Mitchell did not read it that way, nor do I. The manner in which the answer was couched indicates to me that the employer agreed to the difference in the two brothers' earnings of $300.00. There is also the evidence of the widow who remained emphatic that the deceased had told her about his earnings being $2,900.00, of which he gave her $2,200.00 per month. She would know how much she was given every month and I see no reason to doubt her evidence. I find that at that time of his death the deceased was earning $2,900.0 per month of which he gave $2,200.00 to his wife for running the household.

35. The family income at the time of death was $2,200.00 per month. To assess the dependency, I must deduct such share of this amount as is attributable to expenditure on behalf of the deceased. The general approach is to take an arithmetical share unless there is evidence which establishes that the member of the family concerned was clearly more or less expensive than the average - YEUNG Wing v. V,S,L.Engineers (Hong Kong) and others, (1981) H.K.L.R. 130. Mr. Mitchell submitted that in a household comprising a total of seven, that is, including the four daughters born in July 1968, August 1969, April 1971, June 1973 respectively and the son born in July 1975, the deceased was less expensive in that he ate his lunches out. This may be so but it does not take into account that he may be more expensive in other ways. I do not find sufficient evidence to displace the usual approach and estimate that it cost one-seventh of $2,200.00 to support the deceased. Thus $314.00 should be deducted from that figure, to give the family dependency of $1,886.00 at the time of death.

36. The employer said that the present day average earning of a coolie is $4,000.00. This would seem to approximate reasonably to the present earnings of the deceased's brother of $4,700.00. I accept the employer's evidence, and find that had the deceased been alive today his earnings would have been $4,000.00 per month. It is reasonable to expect that his own personal expenses would have risen correspondingly and on the basis that his earnings would have gone up by 37.93%, his personal expenses would now have been approximately $965.50 per month, making his contribution to the family $3,034.50. If one-seventh of this were expended on the deceased, the dependency would be $2,601.00.

37. So the dependency at the time of death was $1,886.00 and at the date of the trial $2,601.00. The median dependency was thus $2,243.50. To this I have to apply the multiplier of 13.

38. Counsel put the pre-trial period at 66 months. That is obviously wrong. Taking the remaining three months of 1979, and the first three months of 1986, with the intervening six years, the pre-trial period is 78 months, which multiplied by the median dependency of $2,243.50 gives me $174,993.00. The dependency for the post-trial period would be $2,601.00 multiplied by the remaining 78 months, that is, $202,878.00. Allowing for the flat rate of 17% tax, these figures come to $145,244.20 and $168,388.75 respectively.

39. For the loss of expectation of life I award the conventional sum of $20,000.00.

40. Coming now to the compensation for the lost years, the accepted approach to the free balance is set out in WONG Sai-chuen v. TAM Mei-chun, Civil Appeal No. 133 of 1981, where Roberts C.J. suggested that it is open to trial judge, having assessed the FAO dependency "(a) to apply this figure as the first part of the free balance, unless there is evidence that the amount of dependency might have varied during the lost years ; (b) to add to this the deceased's notional savings during his lost years."

41. The deceased did not smoke or gamble. There is no evidence that he was given to any expensive habits. The eldest daughter who is now employed as a sales girl left school in 1984 after she failed to be promoted to Form V. Had she repeated which, according to the mother she was prepared to de and had the mother the financial means to let her do so, she would still be studying. As such, the family situation with regard to dependency would not have varied. Finding that the deceased was of frugal disposition, I am inclined to the view that 10% of the deceased's net earnings as the amount of his notional savings is reasonable in the circumstances, which would give a saving of $400.00 out of a notional income after death of $4,000.00. For 156 months this comes to $62,400.00.

42. With regard to the funeral expenses totalling $10,809.00 which were paid by the employer, Mr. Mitchell submitted that this amount should be awarded to the Plaintiffs by way of an expense caused by the defendant. I accept that this was an ex-gratia payment by the employer, and I see no justification for making such an award.

43. The summary of the awards therefore is as follows :

44. The award under FAO will be merged into the LARCO award and disappear, leaving $396,032.95 payable to the Plaintiffs.

45. There will be judgment in this sum of $396,032.95 against the first defendant, with costs.

46. I will now hear the parties as to the interest on the various awards and apportionment.

47. After hearing the parties, the following orders were made :