LAM PO YUK AND ANOTHER v. MERCURY SHIPPING CO LTD (IN LIQUIDATION)

IN THE HIGH COURT OF HONG KONG

COURT OF FIRST INSTANCE

-----------------

---------------------------------------------------

ASSESSMENT OF DAMAGES

---------------------------------------------------

1. This is an action brought by the administratices of the estate of the deceased under the Law Amendment and Reform (Consolidation) Ordinance, Cap. 23, and for the benefit of his dependants under the Fatal Accidents Ordinance, Cap. 22. The first named plaintiff is the elder sister of the deceased and the second named plaintiff is the ex-wife of the deceased.

2. The deceased was an electrician employed by the defendant to work on board the M. V. "Acacia". On 17th August, 1989, while the vessel was in Reunion, the deceased met with an industrial accident. He was admitted to the Gabriel Martin Hospital in St. Paul, Reunion, for treatment. The injury report made on the day of the accident records the injuries as "Awaiting doctor's full report but suspect broken rib/s. One or two teeth may be loose and chin was seen to be bruised and swollen. Minor cuts and scratches on the skin especially around the hands." According to the medical reports, the deceased had sustained direct traumatism of the left hypocondrium, ie, the left lateral regions in the upper zone of the abdomen, below the level of the floating ribs.

3. On 18th August, 1989, upon echography, the deceased was found to have splenic contusion with suspicions about the pancreas, and a splenectomy was performed. After the operation, the deceased's condition did not improve and his digestive system deteriorated further. A pleural effusion appeared on the lelft side. On 26th August, 1989, the deceased had a second operation to remove part of the pancreas and the gall bladder. Later, the deceased was found to suffer occlusive sydrome.

4. The deceased was depressed whilst hospitalized, and he was repatriated to Hong Kong on 15th September, 1989, for further medical treatment. He arrived in Hong Kong on 17th September and was admitted to the Canossa Hospital for treatment. His condition continued to deteriorate and on 22nd September, 1989, he was transferred to Queen Mary Hospital for further treatment. In spite of the medical treatment, he died on 26th September, 1989. The cause of death on the post-mortem examination report was recorded as "gastro-intestinal bleeding from duodenal ulcer."

5. The Writ issued on 31st July, 1992, with an amended Writ being filed on 21st July, 1993. On 25th April, 1994, the defendant company (in liquidation) filed an acknowledgment of service of Writ, stating that it did not intend to contest the proceedings. Interlocutory judgment was entered on 13th May, 1994. A notice under Section 47 of the Evidence Ordinance and Order 38 of the Rules of the Supreme Court was filed on 31 May, 1996, with a supplemental notice being filed on 22 June, 1997, and a third notice being filed on 16 September, 1997. Pursuant to the order of Mr. Registrar Betts, dated 25th July, 1997, the plaintiffs filed four witness statements, with the notice of appointment of assessment of damages issuing on 28th August, 1997. A revised statement of damages was filed on 19th September, 1997.

6. At the assessment, the four witness statements were admitted into evidence, with the two sons giving oral evidence. The defendant company, in liquidation, was absent.

7. At the date of the accident, the deceased was aged 54.

FAO

Loss of dependency

8. The claim for loss of dependency under the Fatal Accident Ordinance, Cap. 22, is made on behalf of the following dependants -

The elder sister of the deceased, Lam po yuk, aged 75 now

The elder son of the deceased, Lam kent son, aged 23 now

The younger son of the deceased, Lam kin teng, aged 22 now

9. As a divorcee, the second named plaintiff was not a dependent of the deceased at the time of the accident.

10. At the time of the accident, the deceased was earning a basic monthly sum of $6,800, together with a monthly leave pay of $2,285 and monthly free meals valued at US $106 (HK $827), being a total income of $9,912 per month. Form 2 and the defendant's details of earnings are to be found at pages 2 and 41 and 42 of the Document Bundle. The deceased was required to work 7 days a week on board the vessel but received leave pay in lieu of holidays.

11. Because the defendant company has been wound up, it would now be impossible to know how much the deceased would have earned but for the accident. Counsel submitted that it would be reasonable to suppose that the deceased's earnings would have increased by about 10% per annum, approximately in line with the rate of inflation. Counsel referred to Kwan wing sang v. Chi chiu Engineering Co. Ltd., PI No. 1045 of 1995, and Yau wong fui v. Winning Fire Engineering Ltd., PI No. 110 of 1996, reported in paragraphs H48 and H49 of the August 1997 issue of Hong Kong Law Reports and Digest, in support of this submission. In Kwan wing sang, a 12% increase per year was adopted and in Yau wong fui, a 10% increase per year was adopted.

12. I accept Counsel's submission, and adopt a 10% per annum increase for the period since death. On that basis his his current expected monthly earnings would have been -

$9,912 x 110% x 110% x 110% x 110% x 110% x 110% x 110% x 110% 

= $21,247

13. Counsel submitted that she would be pursuing the loss of dependency claims based on the actual contributions made by the deceased to his three dependants.

14. As to the loss of dependency of the elder sister, in her statement Lam po yuk says that the deceased would give her a sum of $600 to $800 twice a year. On her birthday he would give her $300 and at Lunar New Year $600. Lam po yuk's claim is set out at page 4 of the Revised Statement of Damages, at page 8 of the Pleadings Bundle. The claim is based on the sum of $800 x 2 per annum, and on the assumption that the deceased's contribution to her would have increased at the rate of 10% per annum, so that Lam po yuk would now receive about $3,430 per annum from the deceased. Lam po yuk's claim for loss of dependency from 26th September 1989 to 9 October 1997, a period of 8-1/2 years at a median of $2,515 per annum would amount to -

= 2,515 x (8 + 1/24)

= $20,225

15. I accept the basis of the claim on behalf of Lam po yuk, and make an award of $20,225 for the pre-assessment loss of dependency.

16. As to the loss of dependency of the two sons, Lam kent son in his affidavit states that his father paid maintenance to his mother in the sum of $800 per month for him and his brother. He says his father always gave him $200 odd on occasions like his birthday, and other festivals like Christmas and New Year. He would also give him a sum of $300 odd on each return trip to Hong Kong. Two months prior to the accident, the deceased started to give him pocket money in the sum of $200 per month via auto pay to his Hong Kong Bank Savings account. However, he had just received a lump sum of $800 and then lost his savings book. He had opened a new bank account and intended to tell his father the new number when he returned to Hong Kong, but unfortunately the accident occurred and he was unable to receive further maintenance from his father. He is now aged 23, and is studying for a Bachelor of Engineering (Building Services Engineering) degree at the Hong Kong Polytechnic University. He will graduate in 1998. His current annual tuiton fee is $37,500. His current annual expenses, inclusive of tuition fees, is $80,000.

17. In his affidavit, Lam king ten, tells of the maintenance of $800 per month paid to his mother as maintenance for the two sons. His father always gave him pocket money on his birthday, and other festivals or on each return trip to Hong Kong. He cannot recall the amount he would give each time. Two months prior to the accident, his father started to give him $200 per month pocket money via auto pay to his brother's Hong Kong Bank Savings account. He had received a total sum of $400, with the payments interrupted when his brother lost the savings book and cancelled the bank account. He is now 22, and is studying for a Higher Diploma in Building Surveying at the City University of Hong Kong, and will graduate in 1998. The current annual tuition fee is $28,000, and his current annual expenses, inclusive of the tuition fee, is $56,265.

18. Counsel submitted that the deceased was obliged to pay a monthly sum of $800 to the two sons pursuant to the maintenance order. When the deceased returned to Hong Kong and on special occasions such as the sons' birthdays, Christmas and Chinese Lunar New Year, he would give an average of about $300 to each of the two sons. On average, therefore, each of the sons would receive $1,200 per annum. Moreover, two to three months before the accident, the deceased told the elder son to open a bank account so that he could deposit a fixed sum of about $500 for the two sons. The deceased had actually only deposited a global sum of $800 to cover two months' payment, ie, $200 per month for each of the two sons, when the accident occurred. Just before the accident, the elder son lost the savings book and asked the deceased not to deposit further money in the account until he obtained a new savings book. On average therefore he gave $750 per month to each of the two sons at the time of his death, calculated as follows -

= $800 + ($600 x 4 ÷ 12) + $500

= $1,500 per month for both sons

19. Counsel submitted that the sons are now studying at University, and their current annual tuition fees are $37,494 and $28,113 respectively, as can be seen by the receipts at pages 79 and 80 of the documents bundle. But for the accident, counsel submitted that the deceased would have increased his contribution to subsidize the study of the two sons. The two sons gave evidence as to the encouragement, both in words and in terms of financial support, their father gave them in pursuing tertiary education, and the satisfaction he felt in their progress in their studies. On that basis, Counsel submits that the average contribution to both sons would have increased to $5,500. The median contribution to each of the the two sons would have been -

= ($5,500 + $1,500) ÷ 2

= $3,500

20. The pre-assessment loss of dependency for each of the two sons, from 26th September, 1989 to, say, 9th October, 1989, a period of 8 years and 1/2 month, at a median of $3,500 per son, would be -

= $3,500 x (8 x 12 + 1/2)

= $337,750

21. As to the pre-assessment loss of dependency of the two sons, I accept the submissions and calculations placed before me by Counsel, and I award the sum of $337,750 to each son for his pre-assessment loss of dependency.

22. As to the post-assessment loss of dependency, Counsel submitted that, taking into account the age of the deceased, the age of the first named plaintiff, and the fact that the two sons are expected to be independent in about September, 1998, a multiplier of one should be used in calculating the future loss of dependency, as follows -

First named plaintiff's loss -

= $3,520 x 1

= $3,520

Two sons' loss -

= $5,500 x 12 x 1

= $66,000

23. I accept a multiplier of one for the post assessment loss of dependency of the first named plaintiff and of the two sons, and I award the sum of $3,520 and $66,000 to the first named plaintiff and the two sons respectively under this head.

24. There remains, under the Fatal Accidents Ordinance, the claim for funeral expenses and damages for bereavement.

25. The funeral expenses amounted to about $18,000. Of this sum, $15,000 was contributed by the defendant with the deficit paid by the first named plaintiff. Under section 6(5) of FAO, I make an award of $3,000 for the funeral expenses.

26. I make an award of $40,000 for damages for bereavement under section 4(2)(b).

LARCO CLAIMS

27. Counsel made reference to the provisions of section 20(1) of LARCO and section 4(5) of the Intestates Estate ordinance, Cap. 73. Pursuant to those provisions, the two sons of the deceased are entitled to step into the shoes of the deceased and claim as his estate.

Deceased's loss of earnings

28. Counsel submitted that between the date of the accident and the date of his death, the deceased had suffered a loss of earnings at $9,912 per month for a period of 1-1/3 months, as follows -

= $9,912 x 1-1/3 months

= $13,183

29. I accept the submission on this head of damages, and award the sum of $13,183.

PSLA

30. Counsel submitted that damages may be claimed by the estate of the deceased for the pain and suffering borne by the deceased up to the time of his death. As to the assessment of PSLA, Counsel referred me to the following authorities -

31. Chan kin fu v. Lee kam hung, 1985 HKLJ 110, where a sum of $50,000 was awarded to the victim for the loss of his spleen. In this case, which was decided in November, 1984, the plaintiff was injured in a traffic accident in May 1983. She suffered a ruptured spleen, undergoing an emergency laparotomy and splenectomy, and being hospitalised for one week. $50,000 was awarded for PSLA, which included amounts for suffering surgery and for six months diminished amenity after the accident.

32. At that time, on the authority of Lee ting lam v. Leung kam sing, decided in 1980, the category of serious injuries commanded awards in the range of $60,000 to $80,000. Lee ting lam was followed in assessing damages (taking into account inflation) until 1988, when the Court of Appeal in Lau che ping v. Hoi Kong Ironwares Godown Co. Ltd., increased the range of serious injury awards to $135,000 to $180,000.

33. In Lam fong and Ho kok Keung v. On lee and Co. & Ors., 1992 HKLJ 100, a sum of $40,000 for damages for PSLA was awarded where the deceased had survived for two weeks after the accident. In this case, decided in November 1991, the deceased had suffered very serious burns caused by electrocution in July 1981, and it was common ground that the deceased's injuries fell within the category of "serious" injuries as described in the Lee ting lam case. Reference was made to the November 1990 decision of Wong see mo, where it was said that the lowest end of the category should be $150,000.

34. In December, 1994, the Court of Appeal in Chun yat nam v. Attorney General, No. 92 of 1994, accepted that, taking into account an increase due to inflation only, the level of the PSLA award for serious injury would range from $250,000 to $335,000. In Chan pui-ki v. Leung on and another, (1996) 2 HKLR 401, the category of serious injury award was increased to $400,000 to $540,000. In that case, the Court of Appeal emphasised again that they were guidelines, not strait jackets, and that they were intended to be flexibly applied.

35. Counsel also referred me to Hall v. Staffordshire Moorlands District Council, a Stoke County Court case, unreported, but referred to in Kemp & Kemp, at paragraph $6-071, and Re Moore, a C.I.C.B., York, case, unreported, but found at paragraph F6-072 of Kemp & Kemp.

36. In the Hall case, general damages of GBP 12,000 was awarded to a 15 year old who fell from a climbing frame on to a raised concrete kerb and who suffered internal injuries to his spleen, resulting in its removal. There was also some renal damage, there were resulting adhesions causing repeated attacks of pain, with a long term risk of further intestinal obstruction which might possibly require further surgery.

37. In Re Moore, the 34 year old female, was punched in the abdomen by her husband, her husband initially refusing to call an ambulance, and from expressions of the ambulance and hospital staff, the wife thought she was going to die. She underwent a splenectomy, she was embarrassed by the laparotomy scar, and she suffered psychological symptoms. She was awarded GBP 10,000 in general damages.

38. In the case before me, the deceased was conscious from the time of the accident until his death nearly six weeks later, having undergone two medical procedures in Reunion, feeling depressed in a foreign hospital, no doubt missing his family, probably not able to communicate with those around him except with the help of an interpreter, and requiring medical repatriation over a period of two days. Having considered the facts, I am satisfied that an award for pain and suffering should be made. Counsel submitted that damages for the category of "serious injury". now starts at about $440,000, and that a figure of $150,000 in this case was in all the circumstances reasonable. Having considered the line of authorities in Hong Kong, and the two English authorities, I am satisfied that an award in the amount of $150,000 as claimed is reasonable and proper in this case.

Loss of accumulation of wealth

39. Counsel submitted that at the time of his death, the value of the deceased's estate was $267,880, as can be seen from the provisional schedule filed with the Estate Duty Office, found at page 4 of the Bundle. After the graduation of the two sons, and but for the accident, it would be expected that the deceased would be able to save more of his earnings. Counsel submitted that a global sum of between $50,000 and $100,000 should be awarded for loss of accumulation of wealth for the benefit of the estate in this case.

40. Counsel submitted that there is evidence that the deceased had a habit of savings but there was insufficient evidence to show how much he saved each month. She submitted that the court should consider making a lump sum award following the approach of Deputy Judge Jones in Ho pang lin and Wong hop hing v. Ho shui on & Tsuen Lee Metals and Plastic Toys Co. Ltd., (1994) 2 HKC 994.

41. As to the classifications found in Ho pang lin, the deceased would fall into the third of the three categories set out by Deputy Judge Jones at page 299 of that judgment, that is, a deceased "without any identifiable savings pattern, but whose habits and lifestyle indicate a probability that he would accumulate wealth." Deputy Judge Jones went on to say that "As always, the court must avoid speculation. However, if thrift, frugality, responsibility and perhaps good employment prospects clearly emerge from the evidence then an award should be made even if the contemporary income is fully utilized, for example, on maintaining a young family."

42. Deputy Judge Jones went on to consider the difficulty in quantifying the damages for the loss of that wealth, referring to the approach of Nazareth J. in the case of Chan yuk ying, where he applied a notional 10% of net income in assessing the measure of damages. In the final analysis, Deputy Judge Jones made a global award in the sum of $100,000 for loss of accumulation of wealth in the case before him, saying that "This will necessarily have an arbitrary element, but no more so than the 10% factor adopted in other cases. The figure should be on the conservative side and related so far as possible to the factors of the deceased's lifestyle already discussed."

43. I accept Counsel's submission that in this case I should make a global award. The deceased was an electrician working on board ship, in steady and well paid employment which would have been expected to continue well into his sixties. He was a caring and responsible father to his two sons, assisting them financially to achieve their goal of a tertiary education. As in Ho pang lin's case, it is more probable than not that the deceased would have accumulated wealth by his retirement, and that it is also probable that the deceased would have retained an accumulation of wealth by the date of his death from natural causes. As to the quantum of the award, taking into account the deceased's lifestyle, I am satisfied that an award of $100,000 is appropriate in this case.

44. In summary, I make an award of damages as follows -

45. An award in the sum of $85,000 was made to the first named Plaintiff on 2nd July, 1992, under the provisions of the Employees' Compensation Ordinance, and credit will be given for that payment.

46. I award interest on the special damages at half judgment rate from the date of the accident until the date of judgment. The award of general damages will carry interest at 2% per annum from the date of service of the Writ until the date of judgment. Both awards will thereafter carry interest at judgment rate until payment.

47. The costs of this assessment are to be paid by the defendant to the plaintiff, with Certificate for Counsel, to be taxed if not agreed. The plaintiff's own costs to be taxed in accordance with Legal Aid Regulations.