CHAN SHUN v. SHUN FAT WOODWORD CO AND OTHERS

DCEC397/2001

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES' COMPENSATION CASE NO. 397 OF 2001

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J U D G M E N T

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1. The Applicant claims compensation under sections 9, 10 and 10A of the Ordinance, Cap. 282 (that is the Employees' Compensation Ordinance). The Applicant abandoned the appeal against the review of the Employees' Compensation (Ordinary Assessment) Board's assessment on 2 October 2002 under section 18(1) and (2) of the Ordinance at the hearing.

Background

2. The Applicant was a carpenter working at the Respondents' construction site at the time of the accident on 30 June 1999. He fell down a wooden plank which was placed between two platforms when the wooden plank broke into two pieces. He fell a distance of 1.3 metres or thereabouts and sustained personal injuries to his back and he was hit on the front of his neck, at his throat, as a result of the accident. The 1st Respondent was the subcontractor of the 2nd Respondent and the 3rd Respondent was the principal contractor of the site.

3. The Applicant was 39 years old at the time of the accident having been born on 20 October 1959. In the month of May 1999, which was the month previous to his accident, his earnings was $35,750, and this sum is undisputed under section 11. The Applicant is entitled to rely on the previous month's salary or earnings in the calculation of the compensations under the Ordinance.

4. The Applicant claims that he is unable to resume his former employment due to his injuries and the disabilities caused.

5. The Applicant produced sick leave certificates for the period of the day of the accident, 30 June 1999, to 3 December 2001 and from 5 December 2001 to 8 May 2002, and he claims compensations of temporary incapacity under section 10 of the Ordinance.

6. He in fact claims under section 9 and section 10A as well because these have been agreed by the parties prior to the hearing and the sum agreed is as follows: under section 9, a sum of $120,960; under section 10A, $10,440. The only dispute is over the period of temporary disability under section 10.

Applicant's Case

7. The Applicant suffered injuries to his neck and back according to the medical report. The Applicant at the hearing called no evidence other than what has been produced in the trial bundle. He relies on the medical evidence and the sick leave certificates for his claim for compensation under section 10. There had been interim payments under section 10 of the Ordinance of the sum of $837,367.74. The Applicant now asks for the sum of $286,452.26, $120,960 under section 9 and $10,440 under section 10A. That leaves a balance of $155,052.26. This is the balance under section 10 that the Applicant is asking for at this hearing.

8. The Applicant's solicitor, Miss Loh, submitted that under section 10(2) of the Employees' Compensation Ordinance, the period of absence from duty certified by a medical practitioner and the Ordinary Assessment Board shall be deemed to be a period of total temporary incapacity, and therefore the Applicant is entitled to claim for the balance of that period since the last payment which was for 24 months under section 10(5).

Respondents' Case

9. The Respondents called Drs Au Ka-kau and Brian Chan to give evidence on the Applicant's condition, and they explained their respective medical reports and the joint report of 8 April 2002. Dr Au Ka-kau made two reports apart from the joint report of 8 April 2002; the first report was 15 March 2002 and the second report on 25 November 2002. Dr Brian Chan's report is dated 30 May 2001.

10. The Respondents rely on Dr Brian Chan's opinion that the Applicant should have gone back to work in his former job much earlier than 8 May 2002, albeit, according to Dr Chan, he could have gone back to a lighter form of work, although in Dr Chan's reports, both his 30 May 2001 report and the subsequent joint report, he considers the Applicant suitable to return to his former job.

11. Mr Wong, counsel for the Respondents, submitted that the Applicant had exaggerated the effects of his injury, and Mr Wong further submitted that his present condition was due to his pre-existing condition.

12. As far as the pre-existing condition is concerned, I find this was not supported by any medical evidence. Dr Chan explained what he meant by a pre-existing condition in his joint report of April 2002. He said that 20% of the population over 40 years old would suffer degeneration of the spine under examination of the X-ray. He said he would call that a pre-existing condition and that was referred to in his medical report, although that pre-existing condition shown on the X-ray may not and does not cause the person any discomfort or pain at the time. Given that interpretation, it is not a condition that would have affected the Applicant until he received the injuries in the accident.

13. As far as the Applicant's claim for compensation under section 10 is concerned, the Respondents objected to the compensation from the period of 1 April 2001 to 8 May 2002 because, according to the Respondents, (1) the Applicant's condition was static after that period, that is from or since some time in March 2001; (2) that the statutory 24 months' period under section 10 had lapsed; (3) Drs Chan and Au agreed that sick leave beyond 1 March 2001 may not have any beneficial effect on the final outcome of the Applicant's back injury; (4) that the Applicant would have been covered by section 9 compensation from March 2001 onwards because of what the doctors said in their joint report.

14. The Respondents also considered the 5% of permanent loss of earning capacity assessed by the Assessment Board to be excessive and, according to Mr Wong, it is excessive because it took into account the neck stiffness. This is apparent from page 205 and 206 of the bundle because on page 205 the original assessment by the Assessment Board was 3% and the neck injury and stiffness had not been referred to in that first assessment. It was reviewed, and in October 2002, on page 206 of the bundle, the Assessment Board reviewed the assessment to include the neck injury and the back injury and gave a revised assessment of permanent loss of earning capacity at 5%, a 2% increase from the original assessment.

15. The evidence of Dr Au was, even though on the day of examination on 2 March 2002 he did not find the Applicant to suffer from any neck tenderness, but he said this does not mean he does not suffer tenderness or stiffness at other times. I looked at the other medical reports in the bundle. The medical report of Dr Brian Chan contained a questionnaire, which further showed the Applicant's condition. The Applicant answered questions posed under the questionnaire and it shows that he complained that he suffered from pain varying from the most painful to the least painful, on a scale of 1 to 10, between 2 to 7 or 8 for the Applicant. And on the average, the Applicant gave an average of 5 for the times that he undertook daily activities such as taking a shower or going to the toilet. It is plain that he felt the pain had become worse when he was walking, lifting weight and standing, and he also complained that his mood, his sleep and his enjoyment of life have been affected by the pain.

16. In Dr Au's medical report, he said he anticipated that the Applicant will have on and off exacerbation of his symptom with exertion and he recommended the Applicant to avoid strenuous exertion of his back.

17. It is clear although the Applicant's pain was mainly, after a period of two years, on his back, because of the injury to the L3 to L5 of his vertebrae; nevertheless, his neck was injured at the time of the accident and that it took some time for his condition to recover.

18. Dr Chan rated the impairment and loss of earning capacity of the Applicant at 1%; both body impairment and loss of earning capacity are so rated. Dr Au on the other hand rated the body impairment of the Applicant at 5%, while the loss of earning capacity at 8%. Dr Au said he based his rating on the American Medical Association guide. The Applicant had complained of back pain and limitation of lumbar movement. Dr Au, in his report, said his and Dr Chan's findings were similar apart from the muscle spasm found by Dr Au. Dr Au agreed with the Queen Elizabeth Hospital's doctor Lau Chi-yung's recommendation and advised that the Applicant should avoid heavy physical duty and he said he did not find the Applicant had exaggerated his condition.

19. It leaves, therefore, the only question whether the Applicant should be given the 10 months of compensation for temporary incapacity under section 10.

20. The Respondents' counsel, Mr Wong, criticised that according to the sick leave certificates there is a one day gap, therefore there is a break. The break, of course, he refers to is the first period of sick leave ends on 3 December 2001 and followed by the second part of the sick leave from 5 December 2001 to 8 May 2002. According to Mr Wong, the period must be a continuous one. He protested that there is a lack of continuity. He argues that it should be a continuous period of total temporary incapacity under section 10(2).

21. From my reading of the section, which is this:

"For the purposes of this section a period of absence from duty certified to be necessary by a medical practitioner, a registered dentist, an Ordinary Assessment Board or a Special Assessment Board shall be deemed to be a period of total temporary incapacity, irrespective of the outcome of the injury,"

I find this one-day gap that Mr Wong said had broke up the continuity to be insufficient to displace section 10(2). From my reading of section 10(2), there is no suggestion that section 10(2) will fail if there is a gap.

22. Clearly, from evidence of the sick leave certificate and the medical chits or receipts exhibited in the trial bundle, the Applicant had not gone to his follow-up on 3 December 2001 as recommended by the doctor, but he went for the follow-up treatment on 5 December 2001, two days later, and he was given sick leave until 8 May 2002.

23. According to Dr Au's evidence and in his medical report, he found the Applicant unsuitable to go back to his former employment or that he should take up any job that requires heavy duty.

24. I turn now to the law that both Miss Loh for the Applicant and Mr Wong refer to. First of all, section 10, which is the section the Applicant is applying under, section 10(1) has this to say:

"Where temporary incapacity, whether total or partial, results from the injury, the compensation shall be the periodical payments hereinafter mentioned, or a lump sum calculated accordingly, having regard to the probable duration and probable changes in the degree of the incapacity. Such periodical payments shall be, or shall be at the rate proportionate to, a monthly payment of four-fifths of the difference between the monthly earnings which the employee was earning at the time of the accident and the monthly earnings which he is earning, or is capable of earning, in some suitable employment or business during the period of the temporary incapacity after the accident."

Section 10(2) I have already read. Section 10(5) provides that:

"An employee who has received periodical payments under this section for a period of 24 months from the date of commencement of the temporary incapacity or for such further period being not more than 12 months, as the Court may allow in any particular case, shall no longer be entitled to periodical payments under this section, but shall be deemed to have suffered permanent incapacity and the provisions of section 7 or 9, as the case may be, shall apply to the employee."

25. Section 10 and the subsections that I have read out earlier have been interpreted by the Court of Appeal a number of times and one cannot find a more comprehensive interpretation of section 10, in particular section 10(5), than in the judgment of Rogers VP in the case of Choy Wai Chung & Chun Wo Construction & Engineering Company Limited, CACV 14/2000, and the date of handing down judgment: 29 November 2000. Rogers VP gave the judgment in that case. The issue in that case, like the present one, is on the temporary incapacity compensation under section 10 of the Employees' Compensation Ordinance. On page 3 of the Court of Appeal judgment, Rogers VP has this to say:

"For the purpose of identifying the mischief which gave rise to the introduction of compensation in the case of temporary incapacity under section 10, our attention has been drawn to statements made when the Workmen Compensation Amendment Bill was introduced in 1969. On a second reading, Mr Hathlington(?), who at the time was the Commissioner of Labour, said, amongst other things, 'It has been found that under present legislation, workmen whose injuries have involved fairly lengthy but successful treatment and whose permanent incapacity is assessed at a low rate may have received, by way of periodical payments during treatment, an amount which has absorbed most or all of the compensation ultimately assessed. So the workman leaves hospital with a significant disability but little, if any, cash. Clause 10(b) inserts a new subsection, whereby compensation by way of periodical payments for temporary incapacity shall not be deductible from any lump sum payable for permanent incapacity or, where it occurs, subsequent death.'"

Rogers VP went on to say:

"Even though the wording of the subsection that was introduced at the time was different from the present wording, I consider that the effect of this section is similar and hence reference may still be made to the mischief sought to be cured. It would seem, therefore, that at least one of the mischiefs which was sought to be cured lay in the fact that the method of calculating compensation under the Ordinance did not cater for the fact that the employee might have a significant period of greater temporary incapacity followed by permanent incapacity of a lesser level. The equivalent of what is now section 10(4) was therefore introduced to provide that no compensation for temporary incapacity should be deducted from the compensation payable for permanent incapacity. It should be noted that subsection (2) of section 10 reads, 'For the purposes of this section, a period of absence from duty certified to be necessary by a medical practitioner, a registered dentist, an Ordinary Assessment Board or a Special Assessment Board shall be deemed to be a period of total temporary incapacity, irrespective of the outcome of the injury.'"

And he went on to say:

"In this case, as has been noted already, the medical certificates cover the full period from the date of injury until after the hearing of this appeal. Moreover, the certificate of assessment which was issued by the Employees' Compensation (Ordinary Assessment) Board on 21 July certified the period of absence from duty necessary as a result of the injury as being 30 June 1996 to 10 June 1998. Under review, the board certificated 29 October 1998 and certified the period up to 16 October 1998. On the appeal in the court below, the judge noted that the board first assessed Mr Choy as having 2% permanent loss of earning capacity on 21 July."

And then he refers to the judgment of the judge below giving an interpretation of section 10(2). And on page 5 of his judgment, Rogers VP said further:

"It would seem that perhaps sight was lost of the mandatory effect of section 10(2). Not only were there medical certificates, but the Ordinary Assessment Board had certified Mr Choy as requiring absence from duty up until 16 October 1998, the date of his review. No doubt in civil claims for personal injuries, the court is entitled to look to see what the injuries of the plaintiff are and to see whether indeed the plaintiff was entitled not to be compensated on the basis that he was not able to do any work. Compensation under the Employees' Compensation Ordinance, however, is based on a number of respects on a different premise and the method of calculation is laid down in the Ordinance."

Then he went on to deal with section 10(5). And then on page 6 of his judgment he says:

"The judge below construed the discretion in the court to allow an extension of the period of temporary incapacity as being intended to cover the situation where it is not known, at the end of two years, whether or not the loss of earning capacity will be permanent. If there is a chance that it will not be, the court may extend the period once it is known that the loss of earning capacity is permanent. It is difficult to see why the period should be extended. In my view, in so construing section 10(5), the judge below limited the discretion of the court in a manner not intended by the legislature. As has already been indicated, the mischief sought to be cured by the introduction of the provisions of section 10 was to alleviate the problem, which would be caused when an employee suffered a period of temporary incapacity followed by a period of permanent partial incapacity, which would result in his not receiving adequate compensation for the period when he was temporarily incapacitated. In those circumstances, it appears to me that the discretion in the court below was exercised on the wrong footing. Taking into account the medical certificates which have been produced, it seems to me to be fair in all the circumstances that Mr Choy should receive compensation for temporary incapacity for the full three year period possible. Thereafter, of course, the section mandates that the compensation which will be payable will be the compensation for permanent partial incapacity as certified by the board."

26. In fact, on page 7 of Rogers VP's judgment he found that Godfrey JA (as he then was) in Chan Siu Ling v Tonyear Investment Limited [1999] 2 HKC 348, referring to the cut-off period after which the employee's injury would be regarded as being permanent and he said that the sooner that that was established, the better. Rogers VP has this to say:

"In a situation such as this, where the assessment of the temporary benefit is one which the court is making after the full three-year period has expired, it seems to me that the question of the length of any proceedings might not be such a relevant factor. The length of the proceedings is likely to be relevant in the period whilst those proceedings are continuing; the employee would then be seeking temporary payments whilst the proceedings are continuing. The justification for such payments thus becomes clearer."

27. We are of course today at the hearing itself, like the hearing before Judge Muttrie in the Choy Wai Chung Case - this is not an interim payment hearing - although Mr Wong submitted that according to the judgment of Godfrey JA (as he then was) in the case of Chan Siu Ling, in the dissenting judgment, that there should be a cut-off period as soon as permanent disability is established.

28. I look at the case here at present. It is the opinion of Drs Chan and Au in April 2002, in their joint medical report, to find that the sick leave subsequent to March 2001 may not have any beneficial effects on the Applicant's condition. Dr Au explained what he meant by that statement, and he meant, he said, that the Applicant would not improve from a category 2 condition to category 1, not that his condition was static. He disagrees that he found the Applicant's condition static.

29. I look also at the date of the Employees' Compensation (Ordinary Assessment) Board's assessment. The original assessment was dated 5 June 2002. There was a review to include the neck injury resulting in stiffness and the low back injury resulting in pain and limited motion. The revised loss of earning capacity was 5% and the date of review of assessment is 2 October 2002. Clearly, it has taken that long for the Assessment Board to be able to reach a revised or reviewed assessment of 5%.

30. In view of the authority of the Court of Appeal judgment in Choy Wai Chung's case, from the lengthy passages that I have read out of Rogers VP's judgment, I am bound to allow the compensation sought because I found the Respondents have failed to rebut the evidence of the sick leave granted to the Applicant. I do not find that the medical evidence called supported the objections raised by the Respondents.

31. For the above reasons, I allow the Applicant's claim for compensation after the 24-month period and be extended to 8 May 2002. Since there has been a payment of $837,367.74 paid earlier, leaving the sum of $286,452.26 to be paid which includes the section 9 compensation of $120,960 and the $10,442 under section 10A.

32. Interest on $155,052.26 from 8 May 2002 to date of judgment at half judgment rate. Section 10A compensation, $10,442, at 2% from date of application to date of judgment. Interest on the judgment sum from date of judgment until full payment at judgment rate.

33. I shall allow costs to the Applicant, to be taxed if not agreed.