LO SUI KUEN AND ANOTHER v. YEUNG TING FOR

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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JUDGMENT

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1. The plaintiff sues as administratrix in the estate of her late daughter, who was killed in a traffic accident on 8th December 1985 at the age of 26. Plaintiff's counsel indicated at the outset that he was not seeking an award under the Fatal Accidents Ordinance. This hearing proceeds in terms of interlocutory judgment entered on 28th July 1988.

2. The claims are accordingly those by the estate for pre-trial and post-trial loss of earnings; for funeral and other expenses, and for loss of expectation of life. The last two were agreed and the respective sums of $13,280 and $30,000 are duly awarded under those heads. Also agreed was a multiplier of 15 from death to establish future loss of earnings.

3. Essentially, two matters were in dispute; the level of notional income likely at trial date, and the percentage free balance of that income to which to apply the multiplier. Two witnesses were called; the plaintiff administratrix as the deceased's mother, and an officer in the personnel department of the deceased's employer. The former was called to establish the free balance from the deceased's likely expenditure, and the latter to establish the likely income of the deceased at trial date. I shall first consider the income at trial date.

4. The deceased was employed by Citibank, and the plaintiff called Miss Ophelia Kam of that organisation to speak of her income both then and as to future probability. Miss Kam said she was an assistant manager in what she called the Human Resources Department of the bank's Hong Kong office. As such she was in charge of personnel matters and had scrutinized the deceased's employment file to comment on her career and former prospects. Miss Kam produced and discussed three letters written by her in response to queries from plaintiff's solicitors. These are at pages 23,24 and 36 of plaintiff's bundle of documents; the last of these relates to queries at page 35 of the bundle, also produced by the witness. Miss Kam confirmed in evidence her written conclusions.

5. The letter at page 23 of the bundle speaks of plaintiff's basic salary of $3,000 at death. Overtime and meal allowances were averaged at further sums of $710 and $21.67 respectively. These figures emerged unscathed from cross-examination when Miss Kam said that overtime always occurred and the staff were expected to work when it did. Meal allowances she said were geared to days when the staff worked overtime for more than 3 hours in a day. Miss Kam pointed out in addition that the staff had a 13-month salary year and that the extra month was a guaranteed bonus.

6. I accept Miss Kam's figures and add back one twelfth of the bonus month in the sum of $250, to give an average monthly salary at death of $3,981.73.

7. Turning to her letter of 7th April 1989 at page 24 of the bundle, Miss Kam discussed the likely salary of the deceased had she remained in employment to that date. Comparisons had been made she said with 4 members of staff of similar rank, qualifications and experience to the deceased. Two figures were given, a lower one based solely on percentage increments over the intervening period, and a slightly higher one assuming a promotion. The difference amounted only to some $213, and the figures were inclusive of salary, bonus and overtime.

8. Miss Kam was vigorously cross-examined on the deceased's promotion prospects adduced in support of the higher figure. Despite this, she persisted in the probability of the deceased's promotion and I note that the letter indicates unequivocally that all those with comparable background have been promoted. These included she said the 4 employees used for comparison purposes in projecting the likely income at death.

9. Promotion is never certain, particularly so when it is considered in retrsopect on assumed facts. I am however satisfied that during that period when, on the evidence, there was a high turnover and a high promotion rate, the deceased would probably have been promoted. I therefore find that the deceased's monthly earnings at 7th April 1989 would have totalled $8,372.81.

10. This figure relates to almost 18 months ago and should be upgraded to give a notional salary reflecting intervening changes. I note that inflation has been around 10% a year during that period, however other criteria emerged in evidence more directly appropriate to the deceased's situation.

11. Miss Kam testified that she had applied the actual percentage annual increments awarded by the bank in reaching her figures as at 7th April 1989. These she said were 10.5% in 1986; 15% in 1987; 10% and later 20% in 1988, giving a compounded percentage for that year of 32%, and 15.% in 1989. The average percentage annual increment for those four years was therefore in excess of 18%. This is high, but from the figures and the current economic climate I find probable a further increase in salary of 15% per annum from 7th April 1989 to trial date. Fifteen percent per annum compounded over 18 months gives approximately 23%, which when applied to the earnings at 7th April 1989 will give $10,298.55 at date of trial.

12. I turn to the issue of the free balance for which we rely on the evidence of the deceased's mother, Madam Lo Sui Kuen. She was an elderly lady in noticeable distress and understandably gave only approximate figures for certain aspects of household expenditure nearly 5 years ago. She was however patently honest, and I accept her evidence whilst making due allowance for elements of imprecision.

13. Madam Lo said that her daughter contributed $1,500 per month ostensibly towards household expenses. However, from this sum the mother would herself save $500 per month for her daughter. The issue arose in cross-examination as to whether or not this saving was fully accountable in the free balance of the deceased's income. In response to defence counsel the witness said she herself sometimes worked and put these earnings towards family expenses. The amount concerned she estimated at a few hundred dollars which she earned as a casual worker. She said that this occurred not every month and that the family could not have survived without this money. The frequency of this contribution she placed at more than half the time, although it was apparent that this was the roughest of estimates.

14. In this manner Madam Lo said she saved $10,000 odd from her daughter's monthly contribution in a period of 2 years or so. It is apparent from these figures that she did indeed save something near to $500 a month for her daughter, but it also seems likely that she herself worked in order to subsidize that saving.

15. With imprecise figures and understandably vague recollections it is not easy to assess the level of genuine savings made by Madam Lo from this sum of $500. She said she contributed a few hundred dollars to the household in hard times and did so more than half the time. As a casual worker her earnings would not have been large and I am therefore placing her monthly contribution at an average of $200.  I find that this contribution effectively subsidized Madam Lo's savings for her daughter, and would leave only $300 per month available as genuine savings towards the free balance. I am assisted to this conclusion by the quantum saved by Madam Lo on her daughter's account and by the thrift she claimed to have exercised in doing so.

16. I turn to the overall household expenditure, which the witness said was $3,000 odd per month, covering herself, her daughter, and her husband Ho Chui, the deceased's stepfather. She listed the expenditure individually as $2,250 on food, $970 on rental and management charges, and about $180 on utilities. She said they spent very little on toiletries and cleaning materials as they bought in bulk. She was unable to average this out to a monthly figure, but I would accept around $50 per month for a thrifty family of three in 1985.

17. The contribution of Madam Lo's husband was variable, according to her testimony. He was a construction worker on an uncertain wage and would contribute sometimes around $2,300 per month, but sometimes this would be $2,500 and sometimes $3,000. Madam Lo said that if he paid the rent he would give her less and if he did not he would give her more.

18. From this evidence I conclude that Mr. Ho Chui either paid the rent directly or paid his wife an extra amount sufficient to enable her to do so. In the circumstances I accept that the rental and management fees of $970 should be excluded in deciding the proportion of family expenditure appropriated to the deceased. It would be usual for parents to pay rental outgoings, allowing a self-employed resident child to contribute to her own keep and to general household expenditure.

19. Excluding rental and management fees, household expenditure would have amounted to some $2,500 per month. It is likely from the evidence that the deceased consumed more of the food purchased than her mother or stepfather; she ate more frequently at home, she had a bigger appetite, and she frequently took lunch to work. Noting that food represents most of the monthly expenditure, I agree with defence counsel that $1,000 out of the total of $2,500 should be apportioned to the deceased's upkeep.

20. Of the monthly $1,500 contributed by the deceased, there accordingly remains after expenditure on her upkeep the $300 saved for her by her mother each month. This sum will form part of the free balance in calculating loss of earnings. Left for consideration is the remainder of the income at death amounting to some $2,400, including the pro-rated twelfth of the bonus month.

21. Plaintiff's counsel urges me to assume 10% of earnings as notional savings on the authority of Wong Sai Chuen v. Tam Mei Chun [1985] HKLR 331.  This he contends would produce a free balance of 32% when added to the balance available after an apportionment of expenditure more generous to the deceased than that accepted by the court. The stricter view adopted by the court, would result in a free balance of only 18% if the criterion of 10% of earnings were adopted as a basis for notional savings. This would be unusually low for a young girl whose only entertainment, on her mother's unchallenged evidence, was an occasional picnic or a day out with her mother or friends.

22. Whilst there is no direct evidence of the deceased's savings, it is not difficult to trace an accurate picture of her lifestyle from her mother's answers in cross-examination. She liked music and badminton for instance; she had a walkman cassette player, but did not purchase many cassettes; she did not have a lot of clothes; she would take her mother out, sometimes once sometimes twice a month; she would go out with friends on a day off only if her mother first declined her invitation; she would spend her evenings at home; she would sometimes have a picnic on Sundays, but otherwise would spend that day also at home with her family.

23. The deceased was evidently a kindly and loving daughter, who placed her mother's happiness above the company of her friends. She was evidently far from extravagant and notional savings of a mere 10% do scant justice to the realities. In the circumstances I reject the 10% approach, which anyway conflicts with the thrift I have noted in the sector of Hong Kong society occupied by the deceased.

24. A young girl given to such modest expenditure would have been unlikely in 1985 to spend more than a further $1,000 per month on entertainment, clothes and incidentals. Even including the increased expenditure usual over Chinese New Year, I find an average $1,000 per month from this balance of $2,481.73 a probable maximum. From her total monthly income at death of $3,981.73 including the bonus portion, and after deducting the $1,500 household contribution, the sum of $1,481.73 would therefore remain. Added to this would be the $300 saved for the deceased by her mother. The total savings of $1,781.73 would amount to a 45% free balance on her earnings.

25. I do not find this figure unusual.  Assessments have frequently produced a free balance of 50% or more for single persons. This recently occurred in Lo Lai Hoi v. Wong Han On (HCA 5590 of 1988) when a free balance of 50% was assessed for a 19 year old waitress on a similar Lack of direct evidence of savings.

26. In all the circumstances of this case, including the borderline tax position of the deceased's notional income at trial date, I find a free balance of 45% appropriate.

27. The pre-trial loss of earnings will therefore be calculated on the median figure between the income of $3,981.73 at death and the notional income at trial of $10,298.55. To this median of $6,316.82 will be applied as multiplier the intervening 57.5 months since death, giving a pre-trial award for loss of earnings, on a basis of a 45% free balance, of $163,447.71.

28. To calculate the post-trial award, the balance of the agreed multiplier of 15 is applied to the 45% free balance of the notional income at trial date, giving an award of $10,293.55 x (15 x 12 - 57.5) x45% = $567,707.56.

29. In summary, the total award will be:

30. The award for loss of expectation of life will attract interest at 2% per annum from writ to this judgment. The awards for pre-trial loss of earnings and for funeral and other expenses will carry interest at 5% per annum from the date of death to this judgment. Costs are awarded to the plaintiff with a certificate for counsel.