LI HOI SHUEN v. MAN MING ENGINEERING TRADING CO LTD

HCPI 8/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 8 OF 2004

____________

____________

_______________

J U D G M E N T

_______________

Introduction

1.  This is an action for damages in personal injuries commenced by the Plaintiff who sues in both his capacity as the administrator of the estate of his son (the “Deceased”) and in his personal capacity for himself and other dependents of the Deceased.  The action was brought against the Defendant who was the employer of the Deceased.  This was a sad and tragic case.  The Deceased was sent to work in Jieyang City in the Mainland where he was murdered at the early hours of 22 April 2001 by his two Mainland colleagues for some minor grievance arising out of work.  The two murderers were promptly brought to justice and executed in accordance with the laws in the Mainland. 

2.  The Plaintiff raised four causes of action against the Defendant:

(1)   breach of employer’s duty under the implied terms  of his contract of employment;

(2)   breach of the employer’s duty of care in negligence;

(3)   breach of occupier’s liability; and

(4)   vicarious liability for the acts of the murderous    employees. 

The Defendant denied liability and pleaded contributory negligence.

3.  As the murder of the Deceased took place in the Mainland, there is prima facie a foreign element to the Plaintiff’s claim in contract and in tort.  Neither the Plaintiff nor the Defendant has pleaded that foreign law is applicable.  Accordingly, I shall apply Hong Kong law: see Dicey and Morris: The Conflict of Laws, 12^th ed, vol 2, p 1514.  In any event, insofar as the contractual claim is concerned, the applicable law is Hong Kong law as it is based on a contract of employment entered into in Hong Kong.  Furthermore, pursuant to the direction of Master B Kwan, the parties have engaged their own PRC legal experts who confirmed that it is their common opinion that the wrongful acts which took place in China giving rise to the Plaintiff’s claim are actionable according to the PRC law.  There is, therefore, no need for this Court to conduct any enquiry as to the PRC law.  The applicable law governing the relations between the parties is Hong Kong law.

4.  Counsel agreed that the Defendant’s duty of care in contract is the same as its duty of care in negligence.  I shall deal with the two causes of action together.  The issues raised in this case are:

(1)	(a)	whether the Deceased met his death in the course of his employment with the Defendant, and
	(b)	whether the Defendant as employer had exercised reasonable care in providing a safe system of work and/or safe accommodation for the Deceased while working outside Hong Kong;
(2)	(a)	whether the Defendant was the occupier of the premises where the Deceased was murdered and whether the Deceased was a lawful visitor thereat, and
	(b)	if yes, whether the Defendant has discharged its duty owed to the Deceased to ensure that the premises was reasonably safe for the Deceased to use for the purpose for which he was invited or permitted to be there;
(3)	(a)	whether the two workers who murdered the Deceased were employees of the Defendant, and
	(b)	if yes, whether the murderous act was sufficiently closely connected to their employment with the Defendant such that it is just and fair that the Defendant should be held vicariously liable for their act; and
	(4)	whether the Deceased was guilty of negligence  which contributed to his own death.

The facts

The background

5.  The following factual background is not in dispute. 

6.  The Defendant is a company incorporated in Hong Kong owned and operated by Mr Leung Kwok Ming (“Mr Leung”) and his wife Ms Leung Mi Chun Lisa (“Mrs Leung”).  The Deceased had been a resident of the Mainland who migrated to Hong Kong to join his parents.  In January 1996, he took up employment with the Defendant as an apprentice in air-condition engineering.  He completed his apprenticeship and was promoted to the rank of an air-conditioning technician in January 1999.  During his course of employment with the Defendant, he was required to work in Jieyang City most of the time and very often all by himself.  He usually worked from Monday to Saturday, but was often assigned to work overtime on Sundays and public holidays.  He worked in Jieyang City for seven to eight months in a year and returned to Hong Kong every two to three months.  While he was working in Jieyang City, the Deceased used to telephone his parents during weekends.  Initially, he was provided with hotel accommodation but later he rented his own residence and received rental reimbursement from the Defendant.

7.  It was the Defendant’s usual practice to send technicians from Hong Kong to supervise short-term workers recruited locally in Jieyang City to work on air-conditioning projects.  Those short-term local workers were inexperienced labourers coming from out of the province (外省民工).

8.  On 20 August 2000, pursuant to the instruction of Mr Leung, the Deceased rented a three-storey building near De An Carpark in Jieyang City as a warehouse (the “Warehouse”) for the purpose of storing air-conditioners and equipments.  He entered into a tenancy agreement as tenant for a term of one year at a monthly rental of RMB 1,000.  There were no partitions or doors inside the warehouse on each floor.  The only security installation was a metal gate and a padlock at the entrance to the Warehouse.  While there was no dispute that the tenancy was entered into on the Defendant’s behalf, Mr Leung and Mrs Leung claimed to have no knowledge of the location of the Warehouse.

9.  On or about 12 April 2001, the Defendant instructed the Deceased to work on an air-conditioning maintenance project for the Jieyang City Government Office (“the Project”).  He was given HK$30,000 as petty cash to spend for the Project. 

10.  Upon arrival at Jieyang City on 13 April 2001, at the instruction of Mr Leung, he recruited two out of province workers, Wu Changbing (“Wu”) and Zhou Zhongxiong (“Zhou”) through an employment agency to assist him in the Project.  The Deceased maintained telephone contact with Mr Leung in relation to technical matters and with Mrs Leung on progress and general matters and for reporting off duty for the purpose of recording his overtime work.

11.  Since the first day of his duty trip, the Deceased resided on the second floor of the Warehouse with Wu and Zhou residing on the first floor.  Mr Leung and Mrs Leung claimed to have no knowledge of this fact.

12.  The Deceased had a girlfriend, Miss Lam (“Miss Lam”) in Sha Tau Kok in Shenzhen whom he used to meet during weekends.  They also maintained daily telephone contacts.  Two or three days prior to 22 April 2001, Miss Lam had suggested visiting the Deceased in Jieyang City.  The Deceased turned down her suggestion saying that it was inconvenient due to the lack of partitioning in the Warehouse and suggested to delay the visit until he had finished constructing the partitions of his room. 

13.  The Deceased considered Wu and Zhou lazy and was not satisfied with their performance.  On the other hand, Wu and Zhou were unhappy with the attitude of the Deceased for scolding them and pressing them to work hard.  They planned to murder the Deceased and rob him of his money.  At about 2 a.m. on 22 April 2001, they pinned down the Deceased while the Deceased was asleep and beat him to death with water pipes.  Then they took away his money of about RMB 2,000 and fled. 

14.  Miss Lam had last spoken to the Deceased on the telephone at about 11 p.m. on 21 April 2001.  Miss Lam and Mr Leung lost contact with the Deceased on 22 April 2001.  On 23 April 2001, Mr Leung telephoned Miss Lam and suggested to go to the Warehouse to look for the Deceased.  Then Mr Leung and another employee from Hong Kong, Mr Wong Shing Hon (“Mr Wong”) met Miss Lam in Shenzhen and went to the Warehouse together.  They broke open the gate at the entrance of the Warehouse and found the Deceased lying dead on his mattress on the second floor.

15.  The above factual background is not in dispute.  The only major factual dispute between the parties is whether the Defendant had knowledge that the Deceased was residing in the Warehouse with Wu and Zhou.  I shall deal with this issue of fact under a separate heading in the following paragraphs.  The parties are also in dispute as to the extent of the Deceased’s contribution to his family prior to his death and in some minor issues which I shall deal with in the course of this judgment as and when it is appropriate. 

The Defendant’s knowledge of the Deceased’s residence in the Warehouse

16.  There is no dispute that the Deceased rented the Warehouse on the instruction of the Defendant on 20 August 2000 for the purpose of storing air-conditioners and materials.  The Defendant must be aware of the tenancy, though Mr Leung claimed to have no knowledge of the location of the Warehouse.  According to Miss Lam when the Deceased turned down her suggestion to visit him in Jieyang City because of the condition of the Warehouse where he was residing, she asked the Deceased if he had complained to his employer about the poor living condition and the Deceased told her that he had.  The Deceased told her that he had told Mrs Leung that there were no doors or partitions inside the Warehouse and that he was not satisfied with the performance of the two out of province workers.  The Deceased also told her that Mrs Leung had suggested him to live in a hotel but he decided to reside in the Warehouse so as to minimise the expenses for the Defendant as the Defendant’s business was not in good shape in 2001.  Miss Lam also recalled that in the summer after the fatal incident, through the arrangement of Mr Wong, she met Mrs Leung in a café in Yuen Long.  During the course of that meeting, Mrs Leung said that the Deceased had told her that he would stay in the Warehouse in order to minimise the expenses for the Defendant.  Mrs Leung remarked that it was silly for the Deceased to have done so.

17.  Mrs Leung denied to have ever been told by the Deceased about his residing in the Warehouse.  She admitted meeting Miss Lam in the café, but denied to have said what Miss Lam said she did.  That was the only occasion Miss Lam and Mrs Leung ever met and talked with one another.  Mr Lam, counsel for the Defendant, argued that it was unnatural for the Deceased to have complained about living in the Warehouse with the two out of province workers when he was content to live there.  I think there was nothing unnatural in the Deceased making the complaint to Mrs Leung and being willing to put up with the condition in the Warehouse.  The Deceased had always been a good and faithful employee.  There was nothing unnatural in the Deceased being willing to put up with the condition in the Warehouse in order to minimise the Defendant’s costs in the Project as he thought the Defendant was not doing well.  Mr Lam also challenged the credibility of Miss Lam’s evidence in saying that the Deceased had told her that the Defendant was not doing well financially as the Deceased was given an increase in salary in late 2000.  I think these two facts are not necessarily mutually exclusive.  It is all a matter of degree and subjective assessment for the Deceased. 

18.  There was nothing by way of background for counsel to test the veracity of the witnesses.  It is not easy to adjudge their credibility by their demeanour and say who was telling the truth and who was not.  Miss Lam’s allegation about what the Deceased told her could be easily made, but could be denied just as easily.  The burden of proof remains on the Plaintiff.  Miss Lam and Mrs Leung were total strangers until they met.  Miss Lam was resident in Shenzhen while Mrs Leung was resident in Hong Kong.  They could have nothing to talk about in common during that one hour meeting.  They could not have talked about anything other than the Deceased, the circumstances of his death and why he should have resided in the Warehouse with the two out of province workers.  I consider Miss Lam a truthful witness.  Her evidence is not particularly damaging to the defence case.  Had she had in mind making up a case against the Defendant, she could have put up a more positive case that the Deceased protested for being instructed to reside in the Warehouse or could have easily concealed Mrs Leung’s offer of hotel accommodation to the Deceased.  Her evidence about what the Deceased told her is consistent with her evidence about what Mrs Leung said and commented about the Deceased.  I do not think Miss Lam was exaggerating.  I am satisfied that she was telling the truth.  

19.  Another piece of evidence relied on by the Plaintiff is Mr Leung’s statement to the PRC police on the day he reported the murder to the security bureau.  The following questions and answers he gave to the police are relevant:

「 問： 你是經常來這間出租屋？

答；  我是第一次到這間出租屋，我以前知道他住在這裡，但沒有去到。

問：  這間出租屋住幾人？

答；  這段時間李偉明請了兩個民工，跟他一起住。

問：  這兩個民工是李偉明何時僱用的？

答：  大約是十天前僱用的。

問：  李偉明僱用這兩個民工是否有向你匯報過？

答：  有，但沒有說那裡人，叫什麼名字。

問：  你們是否經常聯系？

答：  我們有經常聯系，每天都有聯系，每天最少兩次。」

The above answers contain a clear admission that although he had never been to the Warehouse before the incident, Mr Leung knew the Deceased was living there and with the two out of province workers. 

20.  In his evidence, Mr Leung said that he did not know the address of the Warehouse and had never been there.  He also said that the Deceased did not wish to tell him where he lived and hence he had no knowledge that the Deceased lived with the two out of province workers while working in Jieyang City.  He maintained contact with the Deceased through his mobile phone.  Whenever he went to Jieyang City he just met the Deceased at the place of work.  He said that he only learned about the Deceased’s residence arrangement from Mr Wong while he was on the bus on his way to Jieyang City on 23 April 2001.  Mr Lam sought to add credibility to Mr Leung’s evidence on the basis of youth psychology in that the young Deceased wished to maintain some privacy from his boss.  I think Mr Leung’s account is inherently incredible.  The Deceased had informed his parents, his girlfriend and at least one of his colleagues, Mr Wong about his residence arrangement.  He had no privacy to keep from anyone at all.  If he had wished to keep the residence arrangement a secret, it would be against his parents and girlfriend that he would be most concerned and less so against his employer.  The Deceased lived in the Warehouse to reduce the Defendant’s costs on the Project.  There was no reason why he should hide this fact from the Defendant.  On the other hand, Mr Leung even took the trouble of obtaining Miss Lam’s telephone number, presumably for the purpose of contacting the Deceased in case he lost telephone contact with the Deceased.  It is incredible that he would not have insisted on the Deceased to give him his residential address so that he could get in touch with him in case of emergencies and in case he lost telephone contact with the Deceased.  What Mr Leung said does not make business sense.  I reject his evidence.

21.  Furthermore, Mr Leung’s evidence in Court is inconsistent with his statement to the PRC police.  Mr Leung said that the statement was not a true record of what he said during the interview with the PRC police and the statement taking officer had rephrased and paraphrased his answers.  He explained that he was treated like a suspect by the police officer questioning him and he was afraid.  If he felt he was being treated like a suspect, there was all the more reason for him to dissociate himself from the knowledge of the Deceased’s residence in the Warehouse and he would not have said that in the past he knew the Deceased was residing in the Warehouse or should have corrected that answer if it had been incorrectly paraphrased or rephrased by the officer.  He admitted that he had the opportunity to read the statement before confirming it.  At the end of the interview, the statement taking officer asked Mr Leung if what he said in the statement was true and it was recorded that Mr Leung replied in the affirmative.  Yet he could not explain why he did not seek to amend the above answers.  I do not consider his explanation credible. 

22.  The statement was a three-page statement about a very serious crime by the person who first discovered the crime.  Each page is only about two-third the size of a regular A-4 page.  Given the brevity of the statement about such a serious crime, the statement was obviously not a verbatim record or anything close to the standard of the statement taken by our local police officers.  I accept Mr Leung’s evidence that the statement was only a summary of the interview and that Mr Leung’s answers had been simplified, rephrased and paraphrased by the statement taking officer.  By our standard, this statement is nothing comparable to a statement taken by our police officer.  However, I believe both Mr Leung and the statement taking officer had treated the statement taking process seriously.  I am satisfied that the statement is a true summary of what was said during the interview.  At the time, Mr Leung had nothing to hide from the police in the PRC.  The possibility of his civil liability would not have occurred to him there and then.  He must be very concerned about the death of this very faithful employee of his and to bring the murderers to justice.  I have no doubt he gave true and accurate answers to the police to the best of his ability.  I give full weight to what he said in that statement, in particular the answers which I have quoted above. 

23.  Having considered the totality of the evidence, I find Miss Lam an honest witness and was telling the truth.  I accept Miss Lam’s evidence and reject the evidence of Mr Leung and Mrs Leung.  Accordingly, I find that the Defendant, through Mr Leung and Mrs Leung, had knowledge that the Deceased resided in the Warehouse with the two out of province workers and consented to that arrangement, that there were no partitions inside the Warehouse and that the Deceased was not satisfied with the performance of the two out of province workers.  However, the Deceased was not instructed or forced to reside in the Warehouse as Mrs Leung had suggested the Deceased to rent a room in a hotel.  But, being a very conscientious and faithful employee, the Deceased declined her suggestion in order to reduce the Defendant’s costs in the Project.  The Defendant connived.

claim in contract and in negligence

Whether the Deceased met his death in the course of employment

24.  The Deceased was murdered at the early hours of Sunday 22 April 2001.  According to Miss Lam, the Deceased had told her that he had to buy some materials for the Project on 22 April 2001.  Mr Shum, counsel for the Plaintiff, relied on this as evidence that the Deceased’s stay in the Warehouse was incidental to his employment and therefore was in the course of employment when he was murdered.  The Defendant challenged the veracity of that evidence on the basis that the shops supplying air-conditioning parts were closed on Sundays.  Some invoices were found near the mattress on which the Deceased died showing that he had purchased materials on other Sundays.  There is no credible evidence to prove that all metal shops were closed on Sundays.  I find it was more likely than not that some shops supplying ordinary mechanical parts were open on Sundays.  I accept Miss Lam’s evidence.  However, in view of the way the case was argued by the parties, this finding is eventually of no significance.

25.  It is the Defendant’s case that as the murder took place while the Deceased was off duty, the incident did not occur in the course of  employment, whether it was the Deceased’s intention to stay in Jieyang City for the purpose of buying materials on the following day.  Mr Lam, counsel for the Defendant referred me to the Court of Appeal decision in Ma Kit Ching Veronica and the Attorney General,CACV 64/1983.  On the other hand, it is Mr Shum’s submission on behalf of the Plaintiff that once out of Hong Kong, the Deceased was in the course of employment except for limited circumstances.  He relied on the later Court of Appeal decision in Hsu Shu Chiao v Lung Cheong Toys Ltd, [2002] 1 HKC 479.

26.  An employee is in the course of employment if he is in the course of doing something which is his ordinary duty to perform or something which is reasonably incidental to that duty: Staton v National Coal Board [1957] 2 All ER 667.  The present case is concerned with the later.  What is reasonably incidental is a mixed question of law and fact.  The courts often indulge in giving a liberal meaning to that expression.  It is extended to acts which are habitually done by an employee to the knowledge of the employer without question: Milner v The Great Northern Railway Co (1884) 50 LT 367 and Aitchison v Page Motors, Ltd (1935) All ER Rep 594.  The Plaintiff’s case is that while sleeping in the Warehouse the Deceased was in the course of employment and is not based on any extended acts done with the express or implied authorization of his employer. 

27.  Mr Lam referred me to the case of Ma Kit Ching Veronica and The Attorney General, CACV 64/1983 and [1983] 1 HKC 470.  In that case, an ICAC officer died in a guesthouse in Edinburgh between 11 p.m. on 11 February 1982 and 10:30 a.m. on the following day while he was on overseas attachment and training duty.  The cause of death was carbon monoxide poisoning due to a blocked flue behind the gas fire in his bedroom.  At the time of his death he had just completed one duty attachment in Manchester and was due to commence another attachment on the following day in Edinburgh, which was the reason why he stayed in that guesthouse.  The widow’s application for workmen’s compensation failed in the District Court which held that the officer’s death did not occur in the course of his employment.  The widow’s appeal to the Court of Appeal was dismissed.  The approach of Mr Neoh who appeared for the widow in the District Court as well as in the Court of Appeal was similar to that of Mr Shum’s.  The facts of that case were indistinguishable from the present one.  I shall refer to the judgment both in the District Court and the Court of Appeal.

28.  In the District Court, Mr Neoh argued that the ICAC officer’s resting or sleeping was a natural incident of his work and that a rest period between two specific periods of duty could amount to preparation for the next day.  That argument was rejected by Deputy Judge Grindey who said at 489:

“Mr Neoh does not have a direct authority for his proposition, and I think that the cases that he has referred to do little to assist him.  I hope I may be forgiven for not referring to all the cases in detail, but I think that the rule in the normal case is that the employee cannot claim if at the time of the accident he has ‘clocked off’ or otherwise finished his duty for that day, unless (and this presumably means that he has not really finished his duty) he is required to spend the night in some particular accommodation.  I have not been referred to, or been able to discover, a case where an accident occurred to the victim while he was resting or sleeping in the required accommodation, but no doubt such an accident might well give rise to compensation in appropriate circumstances.  I think the cases involving travelling to and from a place of work, of which of course there are many, introduce another element which is not present in the circumstances before me.  To negative that element, or to equate the present circumstances with the travelling cases, it would be necessary to find that the period of rest on the night of 11 – 12 February was a natural incident of the work in the manner that Mr Neoh proposes.  I have to say with regret that I do not so find.  I do not consider the fact that the deceased was on a continuous tour of duty visits to be so significant as to take the circumstances of this case out of the purview of the normal rules.  On the one hand, it could be said that resting and sleeping is just as necessary a natural incident of the work and restorative for the labourer who, living at home ‘... from the rise to set sweats in the eye of Phoebus, and all night sleeps in Elysium’.  On the other hand, it can be argued that a proper period of rest in the evening is not just preparation for the next day's toil, but a natural incident of a mature and responsible person's life.  So far as ‘clocking off’ is relevant, I think that Anson Che must be assumed to have been on his own time at the very latest by the time he had moved into the guest house that evening with no specific duties to perform until the following morning.”

29.  In the Court of Appeal, Cons JA upheld Deputy Judge Grindey’s decision in the District Court.  He relied on two authoritative decisions in the House of Lords.  He said at pp 4-5:

“However, in my view, the rocks on which that argument must inevitably founder in this jurisdiction are the two House of Lords’ decision of the London & North Eastern Railway v Brentnall [1933] AC 489 and Alderman v Great Western Railway Co [1937] AC 454.  Both were concerned with railway employees who, having taken a train from one place to another, were obliged to remain in that other place until it was time to take the train back again.  Alderman was a ticket collector working out of Oxford.  When his train reached Swansea he would sign off and would then be free to do as he pleased until the following morning.  He was also free to lodge where he pleased, receiving an agreed allowance.  He was injured when returning from his accommodation to the station.  That was not accepted as being in the course of his employment.

It was the freedom to go where he pleased and do what he pleased which distinguished his case from that of Brentnall, who was an engine driver in the Sheffield area.  During the intervals between his trains Brentnall was not only required to go and stay at the hostel provided by the railway company but also, while he was there, to take proper rest.  He was injured when inside the hostel premises and that was held to be still within the course of his employment, because as Lord Russell put it in Alderman’s case, he was under “the contractual obligation to go to the particular place where the accident happened”.

…  It is in each case not a question of “interrupting” the employment, which is an appropriate approach to a happening such as a tea or meal break, but simply whether the employment continues to run its course.  In Brentnall it did, for the driver was doing something incidental to the discharge of express orders.  In Alderman it did not.  His employer was in no way concerned with what he was doing at that particular moment.  It seems to me immaterial whether the lack of concern is expressly indicated by rules as to signing on or off or is otherwise the natural and inevitable inference from the particular circumstances.  It is conceded that in the present case Mr Che was not on duty 24 hours a day while he was in the United Kingdom.  His schedule of appointments indicates that he was required to present himself at his employer’s office in Manchester on one day and then at 10:30 the following morning at Hobart House in Edinburgh.  His employer clearly accepted that he must travel between the two cities and in so doing, by whatever proper method he should choose, Mr Che would in my judgment have undoubtedly been in the course of his employment.  But further than that his employer as not concerned with how he disported himself and did not require that in the interim he should have been at any particular place at all.  Indeed, he had chosen to stay in accommodation other than that originally booked for him.”  (emphasis added)

The test whether an employee is in the course of employment while he is taking a break for the day which Cons JA distilled from the two decisions of the House of Lords is simply whether at the material time the employment continues to run its course.  Applying that test, the Court of Appeal found that the officer’s employment did not continue to run its course and dismissed the appeal.

30.  Mr Shum did not argue that the principle to be applied to the present case is any different, but submitted that it should be applied in the present days with more common sense and pragmatism bearing in mind the change in circumstances.  He said the two House of Lords’ decisions relied on by Cons JA were decided in the 1930s, while Ma Kit Ching Veronica v Attorney General was decided in 1983.  He referred me to the later Court of Appeal decision in Hsu Shu Chiao and Lung Cheong Toys Ltd.  In that case, a Hong Kong resident was employed by his employer to stay and work in Dongguan from Monday to Saturday.  His employer provided him with quarters in Dongguan and transportation to take him and other employees from Shenzhen to Dongguan on Monday mornings and from Dongguan to Shenzhen on Saturday afternoons for the purpose of returning to Hong Kong.  If he had to work late on Saturdays and missed the employer’s bus, he could arrange his own transport to Shenzhen and be reimbursed by the employer.  On one Saturday, the employee had to work late and missed the employer’s bus.  He took a taxi from Dongguan to Shenzhen, not for the purpose of returning to Hong Kong immediately but to meet his girlfriend.  The employee was killed in a fatal traffic accident on the journey.  His father’s claim for employees’ compensation was dismissed by the District Court on the basis that the accident did not arise in the course of employment.  On the father’s appeal, the Court of Appeal allowed the appeal and reversed the decision of the District Court. 

31.  Mr Shum submitted that the decision in Hsu Shu Chiao and Lung Cheong Toys Ltd which is a decision in 2002 is to be preferred.  He argued that the Court should adopt a modern approach bearing in mind the new social dimension in the present days.  He quoted paragraph 26 of the judgment of Cheung JA at 481 in support of his new approach:

“26.   It has to be borne in mind that many of the travelling cases decided in the past were in the context of a local environment of an employee travelling to and from his work.  The courts were not concerned with cross-border travelling required by an employee in order to reach his place of work, such as many Hong Kong residents are doing these days.  In deciding this case, there is no escape from this new social dimension, which takes account of the nature of a modern employment relationship and the practical consideration that, while a person injured on a public road in Hong Kong may be covered by compulsory third party insurance, there is no certainty that the same protection is afforded to him in another jurisdiction.  The question of insurance coverage is, of course, not the basis in which a case is to be decided.  But this backdrop of a new social environment is how one should consider the case when applying the words of a statute first introduced in Hong Kong in 1953 which in turn was based on the English Workmen’s Compensation Acts introduced in some bygone era.  As Sir John Donaldson MR said in Nancollas v Insurance Officer [1985] 1 All ER 833 ‘The concept is unchanged, but, in a changed social matrix, the foundation of the employment relationship is no longer so much based on orders and instructions as on requests and information and contractual rights and duties are supplemented by mutual expectations of co-operation.’  The cases decided in the past are to be used as guidance to the approach to be adopted, rather than as providing an answer in a particular case.”

32.  Mr Shum then referred to the following passage in paragraph 27 of Cheung JA’s judgment at 482:

 “27.  …  In my view, upon arriving in Shenzhen, his presence in the Mainland was for all practical purpose on account of the employment and on the employer’s time.  …  The reality of the situation is that this is a Hong Kong contract in which Mr Hui, a Hong Kong resident had to travel from Hong Kong to Shenzhen and continued with the onward journey on transport arranged by his employer in order to arrive at his place of work in Dongguan.”

Based on this passage he advanced his proposition that in the light of the new social dimension an employee engaged in cross-border employment is in the course of employment from the moment he crosses the border until the moment he returns to jurisdiction.

33.  I agree entirely with the approach adopted by Cheung JA.  The ability to keep pace with the changing environment and social circumstances is the life-blood of the common law, which keeps the common law ever growing and developing.  However, though the new social dimension Cheung JA referred to was cross-border employment, his dicta were made in the context of travelling to and from work in such a case.  I do not think what Cheung JA said has the effect of changing the law as to what falls within the course of employment and what falls outside.  In fact, I do not think by the above passage Cheung JA was re-casting the law in the very wide term as Mr Shum would have me to accept.  I come to this view because in a later passage Cheung JA restricted the scope of what he said in paragraph 27.  He said in paragraph 31 at 487 as follows:

“31.   Likewise, there must be a limit to Mr Hui’s course of employment, eg a visit to the cinema at night while he was in Dongguan.  As Ormrod LJ observed, a little commonsense is required in such a case.  In Smith v Stage, Lord Goff stated that how one distinguishes the travelling cases in which a man is acting in the course of his employment from those in which he does not, depend on the circumstances of each case.  In this case, Mr Hui was entitled by his contract to go from Dongguan to Shenzhen on Saturday after work.  His journey from Dongguan to Shenzhen must be within the course of his employment.  A return journey from work is recognised to be on the same footing as an journey to work.”

It is implicit from this passage that a cross-border employee does not remain continuously in the course of employment from the moment he crosses the border to the Mainland until the moment he returns to Hong Kong.  This passage indeed overturns Mr Shum’s proposition.  If a short visit to the cinema at night, i.e. outside normal duty hours, constitutes a break in the course of employment, there is no reason why breaks involving longer periods of absence from duty cannot constitute breaks in the course of employment.  There can be other breaks in the course of employment of a cross-border employee, for example, when he visits other places of entertainment at night, or when he pays visits to his Mainland relatives or takes a pleasure trips within the Mainland during holidays.  If these can constitute breaks in the course of employment, there is no justification for the view that when an employee clocks off work he is still in the course of employment merely because he is in the Mainland.  I think the scenario Cheung JA had in mind in paragraph 27 of his judgment was that a cross-border employee ceases to be in the course of employment when he engages in his own affairs after clocking off work but resumes to be in the course of employment when he embarks on his homeward journey in the Mainland. 

34.  I think what was decided in Hsu Shu Chiao And Lung Cheong Toys Ltd was that when considering cases of a cross-border employee travelling for the purposes of and in connection with employment between a place outside Hong Kong and any other such places, the court must bear in mind the new social dimension which takes account of cross-border employment situation.  Whether such travelling is in the course of employment is a question of fact depending on all the circumstances of the particular case.  The case has not laid down any new test to be applied in answering that question.  The test remains whether at the material time the employment continues to run its course.  The very wide proposition advanced by Mr Shum is based on his misunderstanding of the decision in Hsu Shu Chiao And Lung Cheong Toys Ltd with which he made the impossible leap from the case of a cross-border employee on transit to the case of a cross-border employee taking his rest between the time he clocks off duty and the time he clocks on duty.  He has gone far beyond what Sir John Donaldson MR said in Nancollas v Insurance Officer:he was not applying established legal concept in a changed social matrix, he was trying to enlarge the concept.  With respect to counsel, his proposition is an unjustified extension of the principle in Hsu Shu Chiao And Lung Cheong Toys Ltd.  

35.  In my view, whether an employee is in the course of employment is a question of fact.  The test is simply whether at the material time the employment continues to run its course.  Prima facie, an employee is in the course of employment during his duty hours and ceases to be in the course of employment when his duty hours are over or when he clocks off work until he resumes duty on the following day.  The situation may be more complicated in the case of an employee on overseas duty or a cross-border employee.  But, the test whether such an employee is in the course of employment after his duty hours is the same.  This question may be answered by considering whether the employee has the freedom to go where he pleases and do what he pleases, whether the employer is concerned with how the employee disported himself during the off duty hours or whether he was required to go and stay at a particular place in the interim period for the employer’s purpose such as on standby duty or on call.  Resting and sleeping is a necessary and natural physiological activity of the body in a 24-hour cycle.  Thus, prima facie, resting and sleeping at the end of the day creates a natural break in the continuity of employment unless the employee is required by his employer to sleep and rest at a particular place so as to make himself available for the employer’s purpose as and when required.

36.  Having set out the law, I now turn to explore the factual circumstances of the Plaintiff’s case.  The Deceased reported off-duty to Mrs Leung at about 5 p.m. on 21 April 2001.  The following day, i.e. 22 April 2001, was a Sunday.  The Deceased told Miss Lam that he had to buy materials for the Defendant on 22 April 2001.  Apart from that, there was no evidence that the Deceased was required to work on 22 April 2001.  Putting the Plaintiff’s case at its highest, even if the Deceased was required to purchase materials for the Defendant and had to work on 22 April 2001, the very material fact remains that he was murdered outside his duty hours.

37.  There is no evidence that the Deceased was required to stay in the Warehouse in the evening of 21 April 2001 or in any other evening during this duty trip.  The journey between Jieyang City and Shenzhen takes four hours.  Mr Shum suggested that if the Deceased had to work on 22 April 2001 it would be very inconvenient and time consuming for the Deceased to leave Jieyang City for the weekend.  Be that as it may, that does not mean the Deceased must stay in the Warehouse.  According to Miss Lam, the Deceased had told her that Mrs Leung had suggested to him to stay in a hotel or other rented accommodation but the Deceased declined.  In other words, the Defendant had not required the Deceased to stay in the Warehouse for the Defendant’s purpose; the Deceased had a choice where he lived and the Defendant would pay for his accommodation.  Thus even putting the Plaintiff’s case at the highest, it was inconvenient for him not to stay in Jieyang City but the Defendant had never required him to stay in the Warehouse or in Jieyang City for any particular purpose, such as to be on standby duty or to guard the air-conditioners and materials stored in the Warehouse.  Sadly for both the Plaintiff and the Deceased, it was the Deceased’s own choice to stay in the Warehouse.  He had reported off-duty to Mrs Leung at about 5 p.m. on 21 April 2001.  He was on his own time since.  He was not required by the Defendant to stay in the Warehouse.  His staying there was unconnected with the Defendant’s purpose.  The Defendant was unconcerned whether he stayed there or not.  At the fateful moment, the Deceased was off-duty and resting or sleeping which was a natural and necessary physiological activity of the body.  He ceased to be in the course of employment when the attack took place. 

38.  It is Mr Lam’s submission that as the Deceased was not in the course of employment when the attack took place, the question of breach of duty whether in contract or in negligence does not arise and that is the end of the Plaintiff’s claim based on breach of employer’s duty, whether under the contract of employment or in negligence.  I do not agree with that over sweeping submission.  Whether the Deceased was in the course of employment only determines the nature, extent and standard of the employer’s duty of care.  Very broadly speaking, if the Deceased met his death in the course of employment, the duty owed by the employer was more extensive and included the duty to provide safe system of work as well as safe accommodation and the standard of care is much higher.  Otherwise, the duty of care is less extensive and the standard of care is lower.  Furthermore, breaches of duty, whether in contract or in negligence, are not necessarily tied to the course of employment.  Breaches can occur outside the course of employment.   

Duty to provide safe accommodation

39.  I have referred to the new social dimension in cross-border employment which has become very common these days with the relocation of industries and export of skills and services to the Mainland.  Depending on the locality of the place of work, a cross-border employee engaged to work beyond Shenzhen and Macau may have to be accommodated in the Mainland because of the time and costs of travelling.  Provision of accommodation in the Mainland is a matter of agreement between the employee and his employers.  Usually, local employees are employed to work during weekdays in the Mainland and they return to Hong Kong during the weekends.  Some work for longer spells of a month or more before they return to Hong Kong for a break.  Some employers provide quarters and transportation for the employees to and from Shenzhen to the place of work in the Mainland as in the case of Hsu Shu Chiao And Lung Cheong Toys Ltd.  As the employee has to stay and work in the Mainland, it is usually a term of his employment that the employer shall provide accommodation or cash allowance in lieu. 

40.  If the employer provides accommodation or quarters for his employee, the law imposes on him a duty of care to see to it that the accommodation he provides is a proper accommodation for the employee to live in.  This duty of care is created under the neighbourhood principle by an employer who causes his employee to work out of jurisdiction and to be accommodated in a place over which the employer has control.  Similarly, a term containing such duty can also be readily implied into the contract of employment.  The basic requirement of an accommodation is to provide shelter from the weather and security for the person’s safety.  The employer’s duty of care in providing safe accommodation covers a scope which overlaps with but is different from that of the general duty of care owed by an occupier to his lawful visitor under the Occupiers’ Liability Ordinance.  This duty is usually not very onerous, particularly in a society which enjoys a high standard of living and good public security.  This duty is hardly breached in a city like Hong Kong which enjoys a high standard of living and is a safe place to live in.  But the duty does exist despite its inconspicuous presence under the local circumstances. 

41.  However, the position is different where an employee is caused to work and reside out of Hong Kong.  This is particularly so in a place like China which is renown for its level of criminal activities especially in small cities.  The employee is unfamiliar with the local circumstances and has no knowledge of the level of public security there.  A foreigner makes a good and vulnerable target for criminal activity.  On the other hand, the employer is in China to do business.  He is more familiar with the local circumstances and has the resources to ensure his employee’s safety.  The employer must see to it that his employee is reasonably safe in using the accommodation which he provides for the employee whom he causes to work in a place which the employee is not familiar with and where his personal safety is at risk.  The duty of care which an employer has to discharge for his employee working in the Mainland is more onerous than that owed to his employee working in Hong Kong.  The extent of the duty and the standard of care depend on the facts of the individual case.  It is impossible to lay down general rules. 

42.  An employer usually provides accommodation in the form of hotel accommodation for short periods of stay or rented quarters for longer durations of stay.  Where cash allowance is given to the employee to find his own accommodation, the employer could be said to have contracted out of his duty of care to provide safe accommodation.  Where the employer provides hotel or rented accommodation, he could be said to have delegated his duty of care to the hotelier or landlord of the rented premises, provided he has not been negligent in his choice of accommodation. 

43.  In the instant case, the Defendant had provided hotel or rented accommodation to the Deceased in the past when he was required to work in Jieyang City.  It was Mrs Leung’s evidence that the Deceased was free to choose his accommodation and the Defendant’s obligation was to reimburse the Deceased the rent he paid.  The Plaintiff could offer no evidence to contradict Mrs Leung’s evidence.  Hence, it was argued on behalf of the Defendant that its obligation was to pay the Deceased a cash allowance and the Defendant did not owe the Deceased any duty of care in respect of the accommodation of the Deceased’s choice.  In my view, whether the Defendant’s contractual duty was to provide accommodation or cash allowance is besides the point because on my finding of fact the Defendant connived at the Deceased residing in the Warehouse in lieu of hotel accommodation or cash allowance.  In the circumstances, the Defendant is in the same position as if he had provided accommodation or quarters to the Deceased.  The Defendant was under a duty of care in contract as well as in tort to see to it that the Warehouse was reasonably safe for the Deceased to live in.

44.  Before the Defendant came under any duty to discharge its duty of care in providing safe accommodation, the Plaintiff must prove that the Defendant either knew or ought to have known that there was a risk that the Deceased may be attacked by the two out of province workers.  In W v Commissioner of Police for the Metropolis [2001] PIQR 81, a policewoman was raped by her colleague during off duty hours and she sued the Commissioner of Police as employer of her colleague.  Lord Slyn of Hadley held at paragraph 108 at p105:

“If an employer knows that acts being done by employees during their employment may cause physical or mental harm to a particular fellow employee and he does nothing to supervise or prevent such acts, when it is in his power to do so, it is clearly arguable that he may be in breach of his duty to that employee. It seems to me that he may also be in breach of that duty if he can foresee that such acts may happen and if they do, that physical or mental harm may be caused to an individual.”

45.  As for the degree of such risk that needs to be foreseeable and the standard of care required to discharge that duty of care, Keith JA said in Wong Wai Ming and Hospital Authority [2001] 3 HKLRD 209 at 212I to 213H:

“8.     …  However, an employer is not required to take reasonable precautions to remove every risk which might confront its workforce.  In a classic statement of the relevant principles, Lord Reid said in The Wagon Mound (No 2) [1967] AC 617 at pp 642E-643A:

... it does not follow that, no matter what the circumstances may be, it is justifiable to neglect a risk of … a small magnitude.  A reasonable man would only neglect such a risk if he had some valid reason for doing so, eg, that it would involve considerable expense to eliminate the risk.  He would weight the risk against the difficulty of eliminating it … [T]he general principle [is] that a person must be regarded as negligent if he does not take steps to eliminate a risk which he knows or ought to know is a real risk and not a mere possibility which would never influence the mind of a reasonable man…  [I]t is justifiable not to take steps to eliminate a real risk if it is small and if the circumstances are such that a reasonable man, careful of the safety of his neighbour, would think it right to neglect it.

9.      These principles have been applied to the employer’s duty to protect its workforce from attacks while they carry out their duties.  The reported cases in this area tend to involve criminal attacks on staff whose duties include the handling or banking of cash …

10.    There is no dispute in the present case about these principles.  Two issues arise in the present case about their application.  First, was there a real risk, as opposed to a mere possibility, which the Authority ought to have appreciated, that nurses carrying out duties at the reception counter in the waiting room might be attacked?  Secondly, if so, what precautions, if any, should the Authority have taken to reduce the risk of injury to its nurses as a result of such an attack?”

Thus, to consider whether the Defendant was in breach of its duty to provide safe accommodation, the real issue is whether the Defendant knew or ought to have known that there was a real risk as against a mere possibility of exposing the Deceased to physical violence in allowing him to share accommodation with the two out of province workers and if there was a real risk what should the Defendant have reasonably done to avoid that risk.

46.  The safety issue that is involved in this case is not as to the physical condition of the Warehouse, but whether it was safe for the Deceased to share accommodation with the two out of province workers and whether the Defendant was in breach of its duty by permitting the sharing.  Usually sharing accommodation with co-employee is not unsafe, but all depends on the circumstances.  For example, it may be unsafe to permit a young female employee to be sharing accommodation with male employees, especially if they are strangers.

47.  On the facts, the Defendant, through Mr Leung and Mrs Leung, was fully aware of the conditions of the Warehouse, its lack of partitioning and security protection for the Deceased and that the Deceased was residing there with the two out of province workers who were total strangers.  Sharing accommodation with a colleague whom one knows and is familiar with is very much different from sharing accommodation with total strangers and particularly strangers from a foreign place. 

48.  Under cross-examination, Mrs Leung admitted that she knew some of these out of province workers were of bad character and had caused troubles including robberies and murders.  Mr Lam submitted that the two out of province workers had a clear record with no history of violence and did not belong to any special class of persons who have the propensity of violence as in the case of mental patients attending a psychiatric centre.  He argued that most of them are decent people who left their homes to take up employment in order to better their families and it would be discriminatory and disrespectful to suggest that such workers belong to a special class of people with propensity to violence.  While it is wrong to generalise and label the two out of province workers without more as being criminals, there is no reason why one should not be prudent with strangers.  Out of province workers are known to have been involved in serious criminal activities.  The two out of province workers were total strangers to the Deceased and the Defendant.  They came from outside the province with no root or family tie in Jieyang City.  Once out of their place of work, their whereabouts would be unknown.  They came from poor and remote areas in the Mainland where people may have different ideas as to moral and social values.  Their behaviour might be unpredictable.  They might resort to criminal activities such as theft and violence while residing in the Warehouse with the Deceased.  Murder might not have been foreseen, but the risk of violence was a very real one especially if when the two workers were discovered by the Deceased in the course of their dishonest enterprise.  They shared the same accommodation with the Deceased who was on his own.  There were no other employees from Hong Kong in the Warehouse, whose presence could have provided some deterrence against the two out of province workers.  The Warehouse was un-partitioned and offered no security to the Deceased against the two workers.  Applying the reasonable man test, I think there was a real risk that the two out of province workers would resort to criminal activities in order to make quick monetary gain especially if when such circumstance presents itself.  It was unsafe for the Deceased to share accommodation with the two workers alone, especially in the un-partitioned Warehouse which offered no security to the Deceased.  I do not think this is a risk which a reasonably man would lightly take in all the circumstances. 

49.  Mr Lam argued that the Deceased was not a young person and had been brought up in the Mainland and was no stranger to Jieyang City as he had worked there for substantial period of time before.  Be that as it may, the Deceased had hitherto been accommodated in hotels and rented premises in which he was reasonably safe.  He may not be truly aware of the danger he exposed himself by sharing accommodation with the two out of province workers in the Warehouse. 

50.  Though these two workers had no criminal record and the Defendant had no knowledge of their criminal propensity, these are matters which only go to the magnitude of the risk which a reasonable employer would have to balance against the costs of the measures to be taken to avoid that risk.  The risk of violence may be small, but the consequence in the particular circumstances may be serious and could result in death which it did.  That risk could be avoided by instructing the Deceased not to reside in the Warehouse or to prohibit the two workers from residing there with him, or by installing lock and partitions to the floor occupied by the Deceased.  The costs of these measures were minimal.  But what had the Defendant done?  The Defendant had not taken any of these steps or given the Deceased any guideline or warning as to his personal safety in sharing accommodation with the two out of province workers.  Mrs Leung only gave the Deceased a casual reminder “to take care.”  Though she had offered hotel accommodation to the Deceased, she was happy that her offer was declined and she connived at the Deceased residing in the Warehouse, presumably because of the saving that could be made.  The Defendant was under a contractual duty to provide accommodation for the Deceased.  Instead of providing him with proper accommodation, it connived at the Deceased’s residing in the Warehouse.  The connivance had the effect of authorizing the Deceased’s stay in the Warehouse as if it was the quarters provided by the Defendant.  The Defendant rented the Warehouse, suffered it to be turned into a den and allowed the Deceased to walk into it like an innocent lamb to the slaughter house.  The Defendant was in clear breach of its duty of care as employer under the contract of employment and in negligence.

51.  Mr Lam has referred me to a number of decisions in which a contrary result was reached in different factual situations.  I think the result in each case depended on its own facts.  It is not necessary to refer to all of them, except Smith v Ocean Steam Ship Company, Ltd [1954] 2 Lloyd’s Rep 482.  In that case, native coolies in Indonesia called “badjoes” were taken on board the defendant’s ship for loading goods.  These badjoes were known to be of dangerous character and carried knives.  They stabbed the ship’s officer to death without any provocation.  It was held that the plaintiff had failed to establish that the defendant should have foreseen that the presence of badjoes on board the ship would render the crew’s employment dangerous.  That decision was clearly one based on its facts or the inadequacies of the plaintiff’s evidence and has no bearing on the present case, as the risk of exposing oneself to violence in the work place in the presence of other colleagues during working hours is very much lower than the risk of exposing oneself to violence while sharing accommodation alone with total strangers at night.

52.  Next, Mr Lam submitted that even if there was a breach of duty, the Plaintiff has failed to prove causation as whatever steps the Defendant had taken would have made no difference in any event.  He referred to Wong Wai Ming v Hospital Authority [2001] 3 HKLRD 209 at 217-8, in which Keith JA held that the question to be asked by the Court is simply whether if the defendants had taken the measures they should have done, it could be said that the plaintiff would undoubtedly still have received injuries.  He submitted that according to Wu’s and Zhou’s confessions to the police the attack on the Deceased was a premeditated and not an impulsive act.  Hence, he argued even if the Deceased had lived in separate accommodation, the attack would still have been carried out though not as conveniently as it had been done.  He argued that the Plaintiff had failed to prove that it was more likely than not that Wu and Zhou would have been deterred by such inconvenience.

53.  Mr Lam quoted the Australian decision in Modbury Triangle Shopping Centre Pty Limited And Anzil And Another (2000) 205 CLR 254 in support of his argument.  In that case, an employee of a tenant of a shopping centre was attacked in the car park when the lighting was turned out.  Callinan J held at p 303, paragraph 152:

“What strikes me as very likely, and at least as likely as the competing inference, is that the assailants, having brought their bat with them to commit an assault, would not take it home without first using it for that purpose, lighting or not. In short, in my opinion, the respondents’ case should have failed on the issue of causation as well as the issue of duty of care.”

He also quoted another similar case of Proprietors of Strata Plan 17226 v Drakulic, 2002 NSW Lexis 623 in which the issue was whether a robbery would have been avoided if the door lock were not defective.  Heydon JA said that at page 37:

“So here, the plaintiff’s attacker, having brought the mask, cloth and knife to commit a robbery, would not have gone away without using them, locked door or no locked door, chimes or intercom or no chimes or intercom …

The plaintiff has not demonstrated that the measures which the trial judge held would satisfy the defendants’ duty of care would, on the balance of probabilities, have prevented the attack.”

At p 39, Hodgson JA also held:

“Furthermore, even if the front door had been locked on that night, it is for reasons given by Heydon JA far from certain that this would have prevented the assault; and accordingly, in my opinion, a marginal preponderance of probability that the door would have been locked (even if this had been established) would not have been enough to establish on the balance of probabilities that, but for the interference with the lock, the assault would not have occurred.”

54.  I think these are also decisions on their facts and have no bearing on this case.  In Modbury Triangle Shopping Centre Pty Limited And Anzil And Another, the assailants were armed with clubs waiting for the victim to come out of the shop and walk into an unlit car park.  Certainly, whether the car park was lit or not at that particular point in time would make no difference when the assailants have gone that far into their unlawful enterprise.  But it would have made a difference if the victim did not have to work that late when there were more pedestrians in the well-lit car park which would have provided sufficient deterrence.  It would also have made a difference in Proprietors of Strata Plan 17226 v Drakulic, if the victim had moved out of that property.  The same is true in the present case.  On the facts of the present case, it is plainly obvious that if the Deceased had moved into hotel or other proper accommodation, Wu and Zhou would not have the occasion to enter the premises in the early hours of the night and attacked him when he was defenceless.  An attack in the work place or at other hours, even if it were successful, would probably not have been fatal as the Deceased would have been able to put up some resistance and there might be other people around whose presence would have deterred Wu and Zhou from the attack.  I am satisfied that the Plaintiff has proved causation.

55.  Lastly, Mr Lam argued in the alternative that the criminal act of Wu and Zhou constituted a novus actus interveniens which broke the chain of causation.  Whether the act of a third party constitutes a novus actus interveniens depends on, inter alia, the foreseeability of such act.  It has been held that robberies in domestic premises were not uncommon and burglaries were within the reasonable contemplation of the parties as a not unlikely result of the disrepair of the front door:  see Marshall v Rubypoint Ltd (1997) 25 EG 142 and Hui Kay Cheong Hermann and Chi Wo Properties Ltd, DCCJ 1 1682/1990 (20/12/1991).  Mr Lam sought to argue that the present case is distinguishable on the basis that the act of the third party in issue was an attack by co-workers who were permitted by the Deceased to stay with him in the Warehouse instead of intruders from outside.  I think the same test of foreseeability applies here as in determining the question of risk.  For similar reasons, I find that the act of Wu and Zhou was foreseeable and their attack did not constitute a novus actus interveniens.

56.  Accordingly, I find that the Plaintiff succeeds in both his claim in contract and in negligence.

Claim in OCCUPIER’S LIABILITY

57.  The Defendant’s defences to this cause of action is firstly that the Deceased and not the Defendant is the occupier of the Warehouse where the attack took place and secondly that occupier’s liability is not applicable to the facts of the present case. 

58.  Mr Lam submitted that the Deceased was the occupier of the Warehouse at the material time as he was in actual occupation and had possession or physical control over the premises.  He relied on the following passage from paragraphs 7-14 of Charlesworth & Percy on Negligence 10^th Edn which was adopted by Sakhrani J in Suen Yung Cheung and Sun Pong Yung And Sui Kong Wharf Company Limited, HCPI 531/2003 at paragraph 57 and 58:

“57.   …On the question of who is an occupier, “the answer in each case depends on the particular facts of the case and especially upon the nature and extent of the occupation and control in fact enjoyed or exercised by the defendants over the premises.”  Accordingly, an occupier is any person who is in actual occupation for the time being or having possession or physical control, the degree of which need neither be entire or exclusively his, over the premises concerned or over the fixed or the moveable structures including such things as vessels, vehicles or aircraft.”

58.    It is also stated at para. 10-09 Clerk & Lindsell on Torts 18^th Edn that a person is likely to be regarded as an occupier if he has a sufficient degree of control over premises to be able to ensure their safety, and to appreciate that a failure on his part to use care may result in injury to a person coming on to them.”

He argued that the Warehouse was rented by the Deceased as tenant, though the Deceased received reimbursement from the Defendant.  He submitted that on a proper analysis of the facts in this case, as between the Deceased and the Defendant, the former was the occupier and; as between the Deceased and Wu and Zhou, the latter were the Deceased’s visitors.

59.  I have no doubt about the correctness of the proposition of the law as stated by the learned authors of Charlesworth & Percy on Negligence.  The proposition originated from the dicta of Lord Denning in Wheat And E Lacon & Co Ltd [1966] AC 552.  But I do not think the proposition has been properly applied by Mr Lam in his argument.  Though the tenancy was entered into by the Deceased as tenant, it is obvious that he did so as the agent of his employer, i.e. the Defendant.  Hence the Deceased had occupation and control of the Warehouse on behalf of the Defendant.  Through the Deceased, the Defendant had exclusive possession of the Warehouse and had the ability to determine who may reside in the Warehouse.  It is well established that an occupier needs not be in actual occupation of the premises and two or more persons can be occupiers of the premises at the same time: see Wong Tung Ming and Kwok Chiu Hung, HCPI 928/1995 (29/9/1999).  With full knowledge, the Defendant connived at the Deceased residing in the Warehouse as if it was his quarters.  Putting the Deceased’s occupation of the Warehouse in its proper perspective, the Deceased’s occupation was that of the Defendant’s who was therefore the occupier and when using the Warehouse as his residence or quarters in his personal capacity, the Deceased did so with the consent of the Defendant as a visitor.  Thus, as between the Defendant and the Deceased, the Defendant was the occupier of the Warehouse while the Deceased, Wu and Zhou were the Defendant’s lawful visitors.

60.  In its second defence, Mr Lam submitted that an occupier’s liability is in confined to the dangerous conditions of the premises of which he is the occupier and does not cover dangerous activities which are carried on in the premises but which are unrelated to the premises.  He quoted the following passage from Halsbury’s Laws of England (4^th edn), vol 33, paragraph 62, footnote 4, which was adopted by Deputy Judge Gill in Ma Kam Yeung and Fu Hay Kin & Others [1998] 2 HKLRD 615 at 630:

“The present view is that the [Occupiers Liability] Act is confined to situations in which the premises are dangerous and does not cover dangerous activities unrelated to the premises as such but which happen to be carried out there.”

Mr Lam could not find any local or English authorities in support of the above proposition but was able to refer me to two Australian decisions.

61.  The first case is Modbury Triangle Shopping Centre Pty Ltd And Anzil And Another (2000) 205 CLR 254, which I have referred to earlier.  That was the case of an employee of a shop in a shopping centre who was attacked in the car park when there was no light.  Glesson CJ observed at paragraph 2, p 259 :

“The primary issue argued in the appeal concerns the principle upon which an occupier of land may be liable, in an action for negligence, to a person who, whilst on the land, is injured as a result of the deliberate wrongdoing of a third party.  There was also an issue as to causation.”

The Chief Justice considered the issue of duty of care at paragraphs 15 to 19, at p 263 as follows:

“15.   …  It is the appellant’s occupation of the land on which the attack occurred that is the basis for a claim that the appellant was in breach of a duty of care it owed to the first respondent.  The lack of care asserted was an omission adequately to light the place of the attack.  The assumption is that leaving the lights on would have prevented the attack.

16.    It is not contended that the harm suffered by the first respondent resulted from some defect or danger in the physical state or condition of the car park.  This is not a case, for example, where inadequate lighting resulted in the concealment of some dangerous object or condition in the car park, with consequent damage to person or property.

17.    That an occupier of land owes a duty of care to a person lawfully upon the land is not in doubt.  It is clear that the appellant owed the first respondent a duty in relation to the physical state and condition of the car park.  The point of debate concerns whether the appellant owed a duty of a kind relevant to the harm which befell the first respondent.  That was variously described in argument as a question concerning the nature, or scope, or measure of the duty.  The nature of the harm suffered was physical injury inflicted by a third party over whose actions the appellant had no control.  Thus, any relevant duty must have been a duty related to the security of the first respondent.  It must have been a duty, as occupier of land, to take reasonable care to protect people in the position of the first respondent from conduct, including criminal conduct, of third parties …

18.    The basis of the duty which, as occupier, the appellant owed in relation to the physical state or condition of the premises was control over, and knowledge of, the state of the premises.

19.   The appellant had no control over the behaviour of the men who attacked the first respondent, and no knowledge or forewarning of what they planned to do.  In fact, nothing is known about them even now.  For all that appears, they might have been desperate to obtain money, or interested only in brutality.  The inference that they would have been deterred by lighting in the car park is least debatable.  The men were not enticed to the car park by the appellant.  They were strangers to the parties.”

The Chief Justice concluded at paragraph 36 at p 268-9 that:

“36.   The appellant is entitled to succeed upon the ground that its duty as an occupier of land did not extend to taking reasonable care to prevent physical injury to the first respondent resulting from the criminal behaviour of third parties on that land.”

62.  In the same case, Hayes J held there is no general duty on the occupier to control or prevent the criminal activities of third parties on his premises and that in the limited circumstances where the occupier was held to be under such a duty, the duty arose from some other capacities such as an employer’s duty to provide safe system of work.  He said at paragraph 110, p 292:

“110. Some emphasis was given in oral argument to the proposition that an employer may owe an employee a duty to take reasonable care to prevent the employee being robbed.  If that is so, however, it is because the employer can prevent the employee going in harm’s way.  The employer has the capacity to control the situation by controlling the employee and the system of work that is followed.  The duty which the employer breaks in such a case is not a duty to control the conduct of others.  It is a duty to provide a safe system of work and ensure that reasonable care is taken….

Established principle provides the answer to the present problem because it reveals that there is no duty to control the criminal conduct of others except in very restricted circumstances.  Being an occupier of land should not be added to those exceptional circumstances, at least where the complaint that is made by the plaintiff is not about the occupier failing to control access to or continued presence on the premises.  I would wish to reserve for consideration in a case in which they are raised the questions that are presented by a complaint of that last kind.”

63.  Modbury was explained and applied by the Court of Appeal of New South Wales in Proprietors of Strata Plan 17226 v Drakulic, 2002 NSW Lexis 623.  In that case, the plaintiff was injured when she returned home from work and was attacked by an intruder lurking in an entrance foyer used by her to access her apartment.  The entrance door lock was defective.  Heydon JA said at p 32:

“Conventional occupiers’ liability

 There was an attempt on behalf of the plaintiff to fit her case into the general law of occupiers' liability, which imposes a duty to take reasonable care to avoid a reasonably foreseeable risk of injury to plaintiffs arising out of the physical condition of premises.  That is a disingenuous attempt to sidestep the Modbury doctrine, and it must fail.  In the Modbury case Hayne J said at [106] that the alleged breach of duty concerned the “state of the premises”.  The absence of a locking system from a door in this case was in a sense an aspect of the physical condition of the premises, but only in the same sense as the lighting system in the Modbury case.  Despite the fact that the lighting system was capable of characterisation as being part of the “state of the premises”, the High Court was not prevented from declining to recognise liability by that circumstance.  It did not treat the harm caused by the criminals, which the lighting system would supposedly have prevented, as being equivalent to harm caused by some defect in the surface of the car park.  In argument Gleeson CJ asked, at 256:

‘What is the difference between saying that a council that owns and controls a public park is bound to take care that people do not trip and break their legs and saying that the council is bound to take reasonable care that people walking through the park do not get hit over the head with a baseball bat?’

The answer is that in the second instance the harm is caused by crime.  The real issue is not whether there is an aspect of the physical condition of the premises complained of, but of what type of harm that physical condition might have caused or averted.  Thus at [29] Gleeson CJ said:

‘The control and knowledge which form the basis of an occupier's liability in relation to the physical state or condition of land are absent when one considers the possibility of criminal behaviour on the land by a stranger.  The principle involved cannot be ignored by pointing to the facts of the particular case and saying (or speculating) that the simple expedient of leaving the car park light on for an extra half hour would have prevented the attack on the first respondent.’

Similarly here, the principle involved cannot be ignored by saying that the simple expedient of placing a locking mechanism on the door after May 1993 or introducing some other security system would have prevented the attack on the plaintiff.  The issue is not one of the physical condition of the premises in the sense in which that is relevant in conventional occupiers’ cases.”

64.  These dicta contain a comprehensive analysis of the basis of an occupier’s duty of care to his visitor.  The duty arises out of the control and knowledge which an occupier has in relation to the physical state or condition of land.  I think the law is that an occupier may only be liable to his visitor in respect of danger caused by the physical state or condition of the land or by activities carried out on the land for which the land is being used.  In the Modbury case and the Drakulic case, the Australian Courts have made it clear that this liability did not extend to criminal behaviour of strangers on the land.  As an occupier’s liability is based on the physical state or condition of the land or activities carried out on land for which the land is used, the liability cannot be extended to criminal activities of any persons on the land whether they are strangers or co-visitors.  If the law were otherwise, an occupier would have to assume a policing duty on his land not only to see to it that no strangers are admitted into his land, but also his visitors abide by the law.  I do not think it could be our law that the hostess of a social dinner should be liable if one of her guests gets drunk and assaults another of her guests or deliberately steals the property of another guest.  

65.  There are circumstances where the relationship between two parties creates a duty on one to take reasonable care to protect the other from the criminal behaviour of third parties, e.g. an employer to prevent random and unpredictable behaviour by one employee against another as in W v Commissioner of Police for the Metropolis [2001] PIQR 81, or by a student against a teacher as in Lee Tin Yeung And Chiu Chow Association Secondary School & Others HCPI 201 of 1999 (27/8/2002).  But there is no general rule that an occupier is liable for the criminal behaviour of the visitors on his land.  The usual circumstances when an employer is found to be liable for the criminal behaviour of his employee or a third party is based on the control he has over the employee or the third party.  In the present case, the Defendant has no control over the criminal behaviour of Wu and Zhou.  In any event, these cases do not assist the Plaintiff either as I have found that the attack did not arise in the course of employment.

66.  Accordingly, I find that though the Defendant was the occupier of the Warehouse, it was not liable as occupier for the attack on the Deceased by Wu and Zhou.  Had I been able to find there was breach of duty as occupier on the part of the Defendant, I would have found the risk of the attack foreseeable and the death caused by the breach of duty for the same reasons as I have given when considering the Plaintiff’s claim in contract and negligence and I would have found the Defendant liable.

vicarious liability

The close connection test

67.  I have no difficulty to find that Wu and Zhou were recruited by the Deceased for and on behalf of the Defendant pursuant to the instruction of Mr Leung of the Defendant.  Thus, Wu and Zhou were employees of the Defendant.  Counsel have no disagreement that an employer is liable for the tort committed by its employee if such tortuous act is so closely connected with the employment that it would be fair and just to hold the employer vicariously liable: per Lord Steyn in Lister and othrs v Hesley Hall Ltd [2001] 2 WLR 1311.  This ‘close connection test’ was approved by the Court of Final Appeal in Ming An Insurance Co (HK) Ltd and Ritz- Carlton Ltd [2002] 3 HKLRD 844.  In that case, Bokhary PJ said at p 854F-H:

“This is not to say that this criterion is to be treated like a statutory formula.  Its application is always to be undertaken in context … But the basic criterion having been applied, the disposal of each case will always turn ultimately on its own facts and the particular considerations which they raise.”

68.  In the same case, Litton NPJ also held at p 856G:

“The application of the close connection test … to the facts of a particular case is a matter of degree.”

He continued at p 858J-859C:

“Hence, in seeking an answer to the question … it must be remembered that the issue is not free standing, and matters such as the servant’s duties at the time when the tort occurred, whether he was acting in the interests of the employer or solely for himself, et cetera, are still relevant. And, casting one’s eyes a little wider, the court should also have regard to the business activities of the employer broadly speaking and ask if the risk which gave rise to the damage … was created by those activities.”

69.  Thus, whether an employee’s tortuous act is so closely connected with his employment is a question of fact which has to be considered in its proper context.  Factors which have to be considered include: the employee’s duties at the time when the tort occurred, whether he was acting in the interests of the employer or solely for himself, the business activities of the employer and whether the risk which gave rise to the damage was created by those activities.  Deliberate tortuous acts committed totally contrary to the employer’s business or instructions may nevertheless attract vicarious liability for the employer under the above test.

Application of the close connection test to the facts of the case

70.  Mr Shum submitted that the test should be applied with a liberal mind emphasising on fairness and justice.  He referred to Mattis v Pollock [2003] ICR 1335 as an example of this liberal application of the test.  In that case, a nighclub’s doorman attacked a customer with a knife as a revenge directly linked to an earlier event which had taken place in the club during which the doorman was assaulted by the customer and his group for being refused entry into the nightclub.  The finding at first instance that the employer was not vicariously liable for the assault by the doorman was reversed on appeal by the Court of Appeal.  The Court of Appeal held:

(1)         that vicarious liability may arise even if the act of the employee is an independent act in itself and the mere fact that the employee was acting dishonestly or for his own benefit is seldom likely to be sufficient to show that an employee was not acting in the course of his employment;

(2)         there is a call for a more liberal approach in applying the traditional tests of vicarious liability and a greater readiness to hold the employer liable for assaults arsing out of circumstances connected with his employee’s employment, especially where the trouble arises out of the latter’s conduct in the performance of his duties; and

(3)         the vicarious liability of the employer will not be extinguished even if the tort committed by the employee has an element of personal revenge.

71.  Mr Shum submitted that the following facts are very relevant.  Wu and Zhou came into contact with the Deceased because of their employment by the Defendant.  The attack took place in the Warehouse leased by the Defendant for the Defendant’s business and with the Defendant’s knowledge that it was being used as a residence by Wu and Zhou and the Deceased.  Wu and Zhou attacked the Deceased because they were scolded and pressed to work hard by the Deceased in advancing the interest of the Defendant.  The Defendant had knowledge that Wu and Zhou were lazy and did nothing to assist the Deceased.  He submitted that this close connection is established.

72.  In applying the test, one must bear in mind what Bokhary PJ said in Ming An Insurance Co (HK) Ltd and Ritz-Carlton Ltd [2002] 3 HKLRD 844.  The application is always to be undertaken in context and the disposal of each case will always turn ultimately on its own facts and the particular considerations which they raise.  The decision in Mattis v Pollock [2003] ICR 1335 and other decisions cited therein are decisions on their facts and should not be taken as binding precedents.

73.  In Mattis v Pollock [2003] ICR 1335, the English Court of Appeal considered the employee’s duty against the employer’s business as follows at paragraph 30, p 1345B:

“30. Cranston was indeed employed by Mr Pollock to keep order and discipline at the nightclub.  That is what bouncers are employed to do.  Moreover, however, he was encouraged and expected to perform his duties in an aggressive and intimidatory manner, which included physical man-handling of customers.  In our judgment, this aspect of the evidence was not sufficiently addressed by Judge Seymour QC.”

After referring to Lister and Others v Lesley Hall Ltd [2001] 2 WLR 1311, the English Court of Appeal said at p 1328E:

“Acts of passion and resentment (as in Deatons Pty Ltd v Flew (1949) 79 CLR 370) or of personal spite (as in Irving v Post Office [1987] IRLR 289) may fall outside the scope of the employment.”

Then it went on at p 1328F-G and held as follows:

“45. Thirdly, while the employment enables the employee to be present at a particular time at a particular place, the opportunity of being present at particular premises whereby the employee has been able to perform the act in question does not mean that the act is necessarily within the scope of the employment.  In order to establish a vicarious liability there must be some greater connection between the tortuous act of the employment and the circumstances of his employment than the mere opportunity to commit the act which has been provided by the access to the premises which the employment has afforded.”

74.  At p 1342B-H, Lord Millet said:

“80.   Employers have long been held vicariously liable in appropriate circumstances for assaults committed by their employees.  Clearly an employer is liable where he has placed the employee in a situation where he may be expected on occasions to have to resort to personal violence: see Dyer v Munday [1895] 1 QB 742, where the employer was held vicariously liable for a criminal assault committed by his employee while attempting to repossess his employer’s property. Equally clearly the employer is not liable for an assault by his employee on a customer merely because it was the result of a quarrel arising out of his employment: see Warren v Henlys Ltd [1948] 2 All ER 935, where a petrol pump attendant assaulted a customer as a result of a dispute over payment.  The case was decided partly on the ground that the customer had paid for the petrol and was driving away when he was assaulted, and partly on the ground that he was assaulted because he had threatened to report the attendant to the employer.  The reasoning has been criticized, and the better view may be that the employer was not liable because it was no part of the duties of the pump attendant to keep order.  Attention must be concentrated on the closeness of the connection between the act of the employee and the duties he is engaged to perform broadly defined.

81.    In Deatons Pty Ltd v Flew (1949) 79 CLR 370 the owner of a hotel was held not to be vicariously liable for an unprovoked assault by a barmaid who threw a glass of beer into a customer’s face.  The ground of decision was that the barmaid was not in charge of the bar – the publican was close at hand – and she did not throw the glass in the course of maintaining discipline or restoring order.  In the words of Dixon J, at pp 381-382 it was:

‘an act of passion and resentment done neither in furtherance of the master’s interests nor under his express or implied authority nor as an incident to or in consequence of anything the barmaid was employed to do.  It was a spontaneous act of retributive justice.  The occasion for administering it and the form it took may have arisen from the fact that she was a barmaid but retribution was not within the course of her employment as a barmaid.’

In other words, the barmaid’s employment gave her the opportunity to wreak some personal vengeance of her own, but that was all; and it was not enough to make her employer liable.  Had she been in charge of the bar and authorized to maintain order, the result might well have been different. It would not, in my opinion, have been enough in itself to exclude the employer’s liability that she had been paying off a private score of her own.  If so, then there is no a priori reason why an employer should not be vicariously liable for a sexual assault committed by his employee, though naturally such conduct will not normally be within the scope of his employment.”

75.  These dicta suggest that the first and third propositions held by the Court of Appeal in Mattis v Pollock relied on by Mr Shum are no more than conclusions which may be reached on the facts of a particular case.  Whether an employee’s tortuous act is an independent act or was done for his own benefit or has an element of personal revenge is inconclusive as to the employer’s liability.  Whether an employer is vicariously liable for the acts of his employee depends on the particular facts of the case.  I have no difficulty in accepting that the Court should adopt a liberal approach in applying the close connection test.

76.  In this case, the crime was committed by Wu and Zhou when they were off-duty.  They were advancing their own interests (i.e. to rob the Deceased’s properties) and were taking revenge.  The only connections between the crime with their employment are that (a) one of the motives of the attack was that they were unhappy with the Deceased’s criticism of their work performance and that (b) the crime took place in the Warehouse leased and used by the Defendant for storing materials.

77.  The business activity of the employer in this case was to provide air conditioning maintenance or installation services.  Wu and Zhou were employed to provide unskilled labour for the maintenance or installation services.  It was not their duty to maintain discipline or to apply violence in their course of employment as in the case of the doorman in Mattis v Pollock.  On the contrary, it was their duty to conform with the discipline and the instruction of the Deceased.  Nor were they advancing the interest of the Defendant in robbing the Deceased of his possession as in the case of Dyer v Munday.  I am quite unable to find any close connection from the mere fact that their employment had put them into contact with the Deceased or from the fact that the attack took place in the Warehouse leased by the Defendant for the Defendant’s business and with the knowledge that it was used as a residence by Wu and Zhou and the Deceased. 

78.  Mr Shum submitted that Wu and Zhou attacked the Deceased because they were scolded and pressed to work hard for the Defendant’s business and that constituted a close connection as the Deceased did that in advancing the interest of the Defendant.  Though what the Deceased did was in the interest of the Defendant and in the course of his employment, the issue here is not whether the Defendant should be held vicariously liable for the act of the Deceased but whether it should be held vicariously liable for the act of Wu and Zhou.  What Wu and Zhou did was for their own gain.  It was just an act of passion and resentment done neither in furtherance of the employer’s interests nor under his express or implied authority nor as an act which is incidental to or in consequence of anything an unskilled labourer was engaged to do as in the case of Deaton Pty Ltd v. Flew.  It was just an act of retribution done for personal gain.  There is much to be said that the Deceased’s death was related to his employment, but it was not enough to make the employer liable for Wu’s and Zhou’s attack.

79.  It is an undisputed fact that the attack was provoked by a dispute connected with the Deceased’s performance of his duty.  Warren v Henlys Ltd [1948] 2 All ER 935 cited by Lord Millet in Mattis v Pollock provides a good example.  In that case, erroneously believing that the plaintiff had tried to drive away from the garage without payment or surrendering coupons for petrol which had been put into the tank of his car, a petrol pump attendant used violent language at the plaintiff.  After the plaintiff called the police and told the pump attendant that he would make a complaint to the attendant’s employers, the pump attendant assaulted and injured him.  That was a clear case of an assault arising out of a dispute in relation to the employee’s duty.  It was held that the employer was not vicariously liable for the act of the attendant.  While Lord Millet doubted the rationale in that decision, he considered that the case was nevertheless rightly decided on the basis that the employee’s duties did not include maintaining order.  Likewise, it was not Wu’s and Zhou’s duty to maintain discipline on the Deceased or to supervise the Deceased.  It was the other way round.  The attack was motivated for their benefit and not for advancing any interest of the Defendant.

80.  Even adopting a liberal approach in applying the close connection test to the facts in the present case, I am unable to find that the attack by Wu and Zhou was so closely connected to their employment with the Defendant that it would be fair and just to hold the Defendant vicariously liable for their attack.  Accordingly, the Plaintiff’s claim under this cause of action must fail.

CONTRIBUTORY NEGLIGENCE

81.  The Defendant pleaded that the Deceased was contributory negligent.  Mr Lam rightly submitted that any finding that the Defendant is liable must be based on a finding that there existed a real risk of attack which the Defendant ought to have foreseen.  Hence, he submitted that if such risk ought to have been known to the Defendant, this risk must have been even more apparent to the Deceased who engaged and had direct contact with Wu and Zhou.  He also referred to the undisputed fact that the Deceased declined Mrs Leung’s offer to move to hotel accommodation.  Thus, he submitted that in declining Mrs Leung’s offer and in allowing Wu and Zhou to share accommodation with him in the Warehouse with the knowledge that there was no partition which could have provided him with any security from Wu and Zhou whom he had disciplined or scolded, the Deceased was contributory negligent to the extent of 100%. 

82.  The Deceased had been brought up in the Mainland and had worked in Jieyang City for substantial periods before.  In the circumstances, a finding that he had been contributory negligent in looking after his own safety is inevitable.  However, it is primarily the duty of the employer to look after the personal safety of its employee residing in the quarters provided by the employer.  It is only in the most exceptional circumstances that a finding of substantial contributory negligent could be justified.  The employer with its knowledge and resources was in a better position to appreciate the nature and magnitude of the risk than the Deceased in view of his young age, inexperience and lack of prudence.  The Deceased made the fatal error due to his devotion to the Defendant and undue concern about minimising the expenses of the Defendant.  He has fallen into an error which the Defendant was in a better and more detached position to correct.  It must be the duty of the employer to protect the employee from his own stupidity rather than to exploit it.  What the Defendant did was to exploit the unquestioned loyalty and devotion of this young and inexperienced employee.  In my view, the substantial negligence which the Deceased contributed could not exceed 20%.

QUANTUM

Bereavement

83.  The Plaintiff claims $150,000.  This amount is agreed by the Defendant.

Loss of dependency

84.  The Deceased was born on 15 January 1980.  He died at the age of 21.  The Plaintiff claims that the Deceased left three dependents.  Their particulars and relationship with the Deceased are as follows:

Name	Relationship	Date of Birth (Age)	Occupation
Plaintiff	Father	18/2/1947 (58)	Electrician
Lau Shan Shan	Mother	15/9/1952 (53)	Cleaner
Li Kwai Fong	Sister
16/10/1981 (24)	Student

85.  It is agreed between the parties that the Deceased earned HK$12,000 at the time of the accident.  This is consistent with the wage record produced by the Defendant which showed from 1 April 2000 to 31 March 2001 the Deceased earned a total sum of HK$142,666, i.e. $11,889 each month.  This is also consistent with the bank book of the Deceased.  What is in issue whether he made any contribution to his family, and if so, how much.  The Plaintiff claimed that the Deceased contributed HK$7,000 to his family: HK$6,000 as family expenses and HK$1,000 for entertainment.

86.  The Plaintiff said that the Deceased returned to Hong Kong once every two to three months and each time the Deceased returned, he would give the Plaintiff two to three months’ contributions, which would be in the region of $12,000 to $18,000.  This evidence is contradicted by the bank account records of the Deceased which does not show any such withdrawal.   

87.  The Plaintiff, his wife and the Deceased’s elder brother were all working.  They did not need the Deceased’s support.  On the fact, the Deceased spent a substantial period of time in mainland China.  His bank account shows substantial amounts withdrawn in the Mainland, while the withdrawals in Hong Kong seldom exceed $10,000 and usually in sums of a few thousand only.

88.  In the circumstances, I am not satisfied that the Plaintiff has discharged the burden of proving a monthly contribution of $7,000, though I have no doubt that the Deceased contributed.  I consider the amount of $5,500 as admitted by the Defendant in its Answer extremely fair and reasonable.  The parties agreed that the percentage of dependency of the Plaintiff, the mother and the sister are 14%, 23% and 45% respectively. 

Pre-trial Loss of Dependency

89.  Four years seven months and seven days lapsed between the date of death (22 April 2001) and the date of trial (29 November 2005), i.e. 55.23 months.  On this basis and the monthly contribution by the Deceased of $5,500, the loss of pre-trial dependency for the Plaintiff, the mother and the sister is $249,087 ($5,500 x (14% + 23% + 45%) x 55.23).

Post-trial Loss of Dependency

90.  As for post-trial loss of dependency, the parties also agreed to adopt a multiplier of 12 from the time of the Deceased’s death for the Plaintiff and his wife, but could not reach agreement as to the multiplier to be adopted for the sister.  As it is not in dispute that the sister would complete her full time study in two years, i.e. in 2007, the appropriate multiplier for the sister is 2. 

91.  Hence, the post-trial loss of dependency is :

Father :	$5,500 x 14% x (144 - 55.23)	=	$  68,353
Mother :	$5,500 x 23% x (144 - 55.23)	=	$112,294
Sister :	$5,500 x 45% x 24	=	$  59,400
	Total :		$240,047

Funeral and other expenses

92.  The Plaintiff claims special damages in the amount of $69,499 being funeral expenses, $10,000 being travelling expenses for arranging for the funeral and $5,000 being damages for loss of the Deceased’s personal property.  The funeral expenses was agreed by the Defendant, but the Plaintiff failed to provide proof of the other two claims.  The cost of travel between Hong Kong and Jieyang City was about $400 per person per return journey.  I consider a total amount of $10,000 for the two claims adequate.  That would allow three return journeys for the entire family of four with meal allowance for attending to the police investigation and making funeral arrangements and damages for loss of the Deceased’s personal property.  The total award under this head of sum is $79,499.

Loss of accumulation of wealth

93.   The Deceased was born in the Mainland and received only primary school education.  He completed his apprenticeship with the Defendant and was qualified as an air-conditioning technician in 1999.  It was agreed by the parties that the Plaintiff would have earned $12,000 at the time of trial.  By the time of his death, the Deceased had worked for more than four years, at least two years of which as a technician.  He was not yet married although he had a steady girlfriend.  Notwithstanding that, he did not manage to save any significant sum of money.  At the time of his death, he only had HK$8,272 in his Hong Kong Bank account and he had no other property.  The Plaintiff said the Deceased spent a lot of money in mainland China.  Mr Lam argued, somewhat unkindly in my view, that given his background the Deceased had little prospect of advancement and it will be wholly speculative to suggest that the Deceased would have accumulated some money at the time of his natural death.  He submitted no award should be made.  He quoted the case of Wai Kang Kwan v Wong Wing Hong [1989] 2 HKC 585, in which Master Jones refused to make an award in respect of a deceased who died at the age of 17 and who had just finished Form 5 and been employed for one and half months.  Master Jones said at p 590B:

“However much sympathy the parent evoke, the court is an impartial arbitrator between the parties.  It must vigorously, albeit with understanding and humanity, follow established principles and practice in making its award.  This is particularly important in assessing damages for death and personal injury, where an element of speculation is necessarily present.  The court must not, however, speculate beyond such future probabilities as may reasonably be inferred from present facts.  The assumptions I am asked to make by plaintiff’s counsel have little foundation in reality and I decline to make an award for accumulation of wealth.”

Alternatively, he submitted that an award of not more than $100,000 in line with Wang Chin Ying and Lam Ping Fung [1999] 3 HKLRD 190 should be made. 

94.  I respectfully disagree with that submission.  I think Wai Kang Kwan v Wong Wing Hong is inconsistent with most later decisions, including Wang Chin Ying and Lam Ping Fung [1999] 3 HKLRD 190, Tsang Choi Yung v United Christian Hospital [1993] HKLY 471 and Kwan Yau Tai & Another v Eng Kong Container Services Ltd & Another [1998] HKLRD 329.  In Wang Chin Ying and Lam Ping Fung, the Court made an award of $100,000 in the case of a deceased who was a 17 years old student who had just completed Form 4.  In Tsang Choi Yung v United Christian Hospital, the deceased was earning $13,500 a month when he died at the age of 25.  Though the Court found his saving was exhausted from time to time, it was satisfied that the deceased would be able to save up some money in the future when his salary eventually goes up.  The Court awarded $202,500 for loss of accumulation of wealth.  In Kwan Yau Tai v Eng Kong Container Services Ltd, the deceased was earning $9,192 a month when he died at the age of 27.  The Court found he had no pattern of saving but nevertheless made a global award of $200,000 under this head.  I prefer the later decisions to Master Jones’ unduly rigid approach.  That approach was impliedly disapproved by the Court of Appeal in Lam Pak Chiu and Tsang Mei Ying & Another [2001] HKLRD 193.  In that case, Bokhary JA (as he then was) held at 202B and 203G:

“I see no basis for saying that the absence of a savings pattern by the deceased during his lifetime invariably precludes the Court from being able properly to conclude that he would have achieved an accumulation of wealth if he had lived on …

…  Even in the absence of any savings during the deceased’s lifetime, there may in any given case be, on a balance of view, real prospects of an eventual accumulation of wealth such as to justify an award for loss of accumulation of wealth.”  

95.  I think Master Jones’ rigid approach is particularly inapplicable to people who unfortunately died young.  During the initial stage of their career, people do not usually earn much and cannot save much.  It is wrong and unjust to jump to the conclusion that they have no saving pattern.  While the court should not indulge in speculation and in making wild assumptions, the court must also be realistic.  In the usual course of things, it is more likely than not that a person would develop a saving pattern than becoming a spendthrift.  Where there is no evidence which suggests that a person would not make any saving, the court should draw the appropriate inference of what would have happened in the normal course of event than to adopt an unduly rigid approach which is contrary to common sense and common experience.  I for one would not readily come to the conclusion that a young person has no saving pattern unless there is some evidence which permits me to come to that view.    

96.  In my view, the Deceased made impressive achievement from his humble background.  He was hardworking and devoted to his work.  I have no doubt that he had potential for further advancement but for this tragedy.  His career did not actually begin until he completed his apprenticeship in 1999.  He did not make much saving during those two initial years.  He spent a lot of money in China.  But that does not mean in course of time when he would have grown older and acquired a more mature sense of responsibility he would not start to develop a saving pattern.  I think it is inappropriate to gauge the Deceased purely on the basis of his lack of saving at the early stage of his career.  The evidence suggests he had potential to earn more and to develop some saving pattern.

97.  Both parties agree that if I should make an award, I should adopt the global award approach in Lam Pak Chiu and Tsang Mei Ying [2001] 1 HKLRD 193.  Mr Shum asked for a global award of $200,000 as in the case of Kwan Yau Tai & Another v Eng Kong Container Services Ltd & Another.  Having regard to the Deceased’s income, I consider such an award appropriate.

Summary on quantum

98.  I make the following award in favour of the Plaintiff after allowing for 20% contributory negligence:

Bereavement	$150,000 x 80%	=	$120,000
Pre-trial loss of dependency	$249,087 x 80%	=	$199,270
Post-trial loss of dependency	$240,047 x 80%	=	$192,038
Funeral expenses and Special damages	$  79,499 x 80%	=	$63,599
Loss of accumulation of wealth	$200,000 x 80%	=	$160,000
	Total :		$734,907

99.  In accordance with the principle in Kwan Lai Kuen v National Insurance Co Ltd [1998] 1 HKC 98, the award on special damages and pre-trial loss of dependency shall be with interest at half judgment rate from the date of death until the date of trial and the award on bereavement shall be with interest at the prevailing rate of suitors’ fund from the date of death until the date of trial.  No interest shall be awarded for post-trial loss dependency or loss of accumulation of wealth.  

Conclusion

100.  Accordingly, I enter judgment in favour of the Plaintiff in the amount of $734,907 together with interest.  I also make a costs order nisi that the Defendant shall pay the Plaintiff’s costs, to be taxed if not agreed and the Plaintiff’s own costs shall be taxed in accordance with the Legal Aid Regulations.