CHAU YUEN HEUNG v. JEKCO ELEVATORS LTD

HCPI 956/2015

[2023] HKCFI 2750

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO 956 OF 2015

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J U D G M E N T

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1.  This is an action commenced by the plaintiff for injuries sustained by her as a passenger in a lift which malfunctioned. The defendant was at the time the contractor responsible for the maintenance of the lift. The defendant denied liability and joined the management company and the owners of the building where the lift was, holding them responsible as the third parties. The main action between the plaintiff and the defendant has since been settled. This is the trial of the defendant’s claim against the third parties for contribution or indemnity towards its liability for the plaintiff’s damage.

THE SCENE AND THE PARTIES

2.  Fook Yip Building, 53-57 Kwai Fung Crescent, Kwai Chung, New Territories is a 29-storey commercial/industrial building (“the Building”). At all material times, the 1^st third party (“Hon Hing”) was the manager of the Building, and the 2^nd third party (“the Owners”) owned, and still own, the common parts of the Building of which the lifts formed parts (and where appropriate, the two will be referred to below collectively as “the Third Parties”).

3.  At the material times, there were 8 lifts serving the Building. Of them, lifts nos 4 and 8 were passenger lifts. The former served all the floors whereas the latter served the first 15 floors of the Building. Both were of the same brand and model. The then Hong Kong agent of the brand was Chevalier (HK) Ltd (“Chevalier”). Chevalier installed the lifts in 1986 and the lifts commenced operation in about 1987. Chevalier also became the first lift contractor of the Building.

4.  In July 1997, Holake Hong Kong Lifts Ltd (“Holake”) took over from Chevalier and became the lift contractor of the Building until the end of December 2007.

5.  In January 2008, the defendant (“Jekco”) was contracted by Hon Hing on behalf of the Owners to be the succeeding lift contractor of the Building for a 2-year term (“the 2008 Contract”). Upon the expiry of the term, Jekco succeeded in its tender for another 2-year term from April 2010 (“the 2010 Contract”). In April 2012, Jekco succeeded in its tender for a lift renovation contract in respect of 4 of the cargo lifts and another 3-year term of maintenance contract in respect of all the lifts (“the 2012 Contract”). However, Jekco’s last term was terminated early at the end of November 2013 after the accident in question.

THE LIFT

6.  Behind the lift doors on each floor of the Building was the lift shaft (or well) in which the lift car (or cage) travelled between the floors. Opposite the lift car inside the lift well was the balancing counterweight in the form of a stack of metal plates. The counterweight was designed as the deadweight of the lift car plus half of the maximum load of the lift car, and thus heavier than the lift car when the passenger load was less than half of its maximum capacity. In operation, the lift car and the counterweight ascended and descended in opposite directions.

7.  When a passenger pressed a button inside the lift car for a particular floor, the command was sent to the traction machine control panel in the machine room at the top of the lift well. A corresponding signal from the control panel would power the motor to drive the gear box. The gear box would turn the traction sheave which drove the suspension cable rope, causing the lift car to ascend or descend to the designated floor.

THE ACCIDENT

8.  On 9 November 2012, the plaintiff was taking lift no 4 (“the Lift”) of the Building from the 18^th Floor to the Ground Floor. When the lift car descended to around the 10^th Floor, it suddenly shot up until it hit the structural ceiling of the lift shaft at the top floor. Upon the impact, the interior metal ceiling of the lift car fell off, injuring the plaintiff. She was trapped inside the lift car until rescued by the firemen.

ACCIDENT INVESTIGATION

9.  On the day following the accident, a team from the Electrical and Mechanical Services Department (“EMSD”) headed by investigating engineer, Mr Ng Tak Hei (“Ng”), attended the scene.

10.  Upon visual check, the EMSD investigation team and the representative of Jekco had the following findings:

(1)  The counterweight buffer was hit by the counterweight, and all suspension ropes were slackened due to the overshot of the Lift.

(2)  The shaft of the traction machine was broken near the position of the traction sheave as viewed from the gearbox opening.

(3)  The traction sheave was found in an inclined position.

(4)  2 bolts detached from the traction machine were found in the traction machine room.

11.  The investigation team collected relevant information, including the maintenance logbook in respect of the Lift. There is no dispute that the maintenance log was not complete for all the years since 1987. However, the information revealed that due to recurrent oil leakage problem, the traction shaft was disassembled and sent to the machine workshop in October 2011. The traction shaft was found to have a sleeve inserted to the solid core of the shaft. The oil leakage was located at the gap between the shaft and the sleeve, which was believed to have come about after long period of operation of the Lift. The leakage was then sealed by applying the shielded arc welding method. The Lift resumed operation in late October 2011. However, the oil leakage recurred in mid-December 2011. The traction shaft was again disassembled and sent to the workshop, this time for sleeve replacement. The oil leakage was eventually eradicated. The accident happened about 11 months later.

12.  After the accident, the broken traction shaft and its associated gearbox were sent to the EMSD Headquarters for detailed examination. For the absence of record of the original weight of the lift equipment, the EMSD also requested Jekco to arrange the weighing of the lift equipment by a surveyor. The total weight of the lift car, the counterweight, hoisting ropes and compensation chain of the Lift was found to be 4,325kg (±10kg). Net of the hoisting ropes and compensation chain, Jekco calculated the weight of the lift car and the counterweight to be about 1,648kg and 2,170kg respectively.

13.  In the further examination in December 2012, the independent expert observed circular machining marks and crack propagation on the solid core of the traction shaft, and the fracture surface exhibited typical fatigue morphology. The broken shaft was tested by ultrasonic technique for its cross section profile. It showed that the core of the shaft was originally cast and machined to form one solid piece. However, at some stage, the surface portion of the shaft was trimmed from a diameter of 100mm to 90mm to create a step with its face retracted from the bearing location apparently to make room for the insertion of the sleeve mentioned above. The sleeve was then inserted and its two ends welded to the original shaft so as to serve as the seating for the bearing.

14.  Subsequent to a draft investigation report in February 2013 and consideration of further evidence, Ng released his final investigation report dated 21 May 2013 (“FIR”), setting out the following possible scenario of the accident:

(1)  On the day of the accident, the traction shaft broke and caused the lift car of the Lift to ascend at over-speed until it hit the structural ceiling of the lift shaft.

(2)  The traction shaft had been trimmed from its diameter of 100mm to 90mm to create room for the insertion of the sleeve. Fatigue crack originating from the outer edge of the traction shaft was caused by stress concentration from damage induced when the original shaft was trimmed.

(3)  It appeared that the sleeve was added in an attempt to extend the length of the 105mm diameter section to seal up the gap between the bearing and the traction shaft, and thereby to prevent oil leakage.

(4)  The failure of the traction shaft was caused by improper modification works that damaged the integrity of the shaft, and stress concentration at the weak point increased with the development of propagation of fatigue crack after certain period of operation.

(5)  Based on the statements of the personnel from Hon Hing and the successive lift maintenance contractors, ie Chevalier, Holake and Jekco, the EMSD found no evidence that would prove which contractor trimmed the traction shaft since the commencement of operation of the Lift. Holake confirmed that no record, document and detail of maintenance personnel could be submitted to the EMSD. EMSD could only provide the cause of the incident, but not evidence of who trimmed the traction shaft since the commencement of operation the Lift over 26 years ago.

15.  The FIR continued to explain the further action taken and the recommendations made:

(1)  Jekco was requested to submit summary report on the condition of the existing traction machine of the same model (ie lift no 8) with checks on, amongst other things, record of abnormal noise and occurrence of oil leakage.

(2)  The Owners should disassemble the traction machine of the same model (ie lift no 8) for further investigation as the abovementioned alteration on the traction shaft would have a great possibility of causing occurrence similar to the accident.

(3)  Apart from the product manufacturer, no registered contractor would be allowed to undertake such alteration or modification of the proprietary products such as the traction shaft, and such alteration would adversely the safe operation of the lift.

(4)  The Owners are recommended to install ascending over-speed protection device to the lifts.

(5)  The traction machine of the Lift must be replaced.

THE PROCEDURAL HISTORY

16.  Upon the early termination of the 2012 Contract after the accident, Jekco first commenced action in the District Court against Hon Hing in 2014 for payment in lieu of notice of termination as well as outstanding service fees in respect of the 2 passenger lifts of the Building (DCCJ 744/2014). Hon Hing denied liability and put forward a counterclaim. The action was eventually settled in August 2014.

17.  In September 2015, the plaintiff commenced the present action against Jekco for her injury sustained in the accident. Whilst accepting the occurrence of the accident as a matter of fact, Jekco disputed liability.

18.  Jekco then filed a third party notice against the Third Parties, which also accept the occurrence of the accident as a matter of fact but dispute liability to Jekco.

19.  In February 2022, the plaintiff’s claim was settled upon her acceptance of sanctioned payment in the sum of HK$1,500,000 (on top of the employees’ compensation received in the sum of HK$586,328.07).

20.  What remains is the action by Jekco against the Third Parties for indemnity or contribution pursuant to the Civil Liability (Contribution) Ordinance, Cap 377 (“CLCO”) and/or under the common law.

THE PARTIES’ RESPECTIVE CASES

21.  In her claim against Jekco, the plaintiff attributed the accident and her injury to Jekco’s negligence and breach of common duty of care owed to her as a user of the Lift. It was contended that Jekco as the responsible repair and maintenance contractor of the Lift had failed to address the risk of danger arising out of the trimmed traction shaft. Amongst other things, Jekco was said to have:

(1)  failed to adequately or at all to replace the traction machine of the Lift in time when knowing it was defective and dangerous in that the traction shaft had been trimmed from 100mm to 90mm;

(2)  allowed improper modification works to be done on the traction machine eventually causing the traction shaft to be broken;

(3)  allowed the surface of the traction shaft to be trimmed from 100mm to 90mm to make room for insertion of the sleeve, which resulted in stress concentration effect on the fatigue crack;

(4)  failed to assess the risk of trimming the traction shaft and the consequential effect on the operation of the Lift which Jekco knew or ought to have known;

(5)  allowed and effected improper welding[1] at both ends of the sleeve onto the traction shaft such that the property of the steel in the shaft was weakened thus resulting in the failure of the same;

(6)  failed to advise the Third Parties to install an ascending over-speed protection device or unintended car movement protection device in the Lift to prevent the kind of accidental movement in the accident;

(7)  caused, permitted or allowed the Lift to remain in use in the above dangerous condition;

(8)  failed to provide a safe operating system of the Lift;

(9)  failed to warn the plaintiff of the dangers in using the Lift and exposing her to a danger or a foreseeable risk of injury which Jekco knew or ought to have known.

22.  Jekco denied knowledge about the trimming of the traction shaft or that it was the cause of the accident. Specifically, it contended that the traction shaft with the sleeve was its ex-factory state, and the accident was not reasonably foreseeable.

23.  Jekco also contended that the Third Parties had contracted Holake to carry out renovation works to the Lift in 1997 and 2002, which caused significant increase in the load of the lift car by about 380kg[2]. Those constituted major alterations which should have, but had not, been reported to the EMSD. Nor has the same been communicated to Jekco. It was in 2010 when Jekco discovered addition of counterweight which caused it to enquire with Hon Hing, but Hon Hing allegedly misled it to believe that all those had been approved by the EMSD. The resultant significant increase in the total load of the Lift caused metal fatigue to the traction shaft and eventually the accident. Hence the Third Parties were to blame.

24.  Jekco contended that in any event, it had advised and quoted for the replacement of the traction machine and installation of rope grippers, which, had the Third Parties accepted and proceeded with, would have prevented the accident.

25.  Along the same line, Jekco maintains in its claim in the third party action. Specifically, the Third Parties are said to have:

(1)  failed to report to the EMSD the renovations to the Lift in 1997 and 2002[3], which significantly increased the weight of the lift car and counterweight by a total of 1,000kg, and which amounted to major alterations compromising the integrity of the traction shaft;

(2)  failed to inform Jekco of the particulars of those major alterations to the Lift since its commencement as the lift contractor in 2008, but misled it to believe that the alterations had been approved by the EMSD;

(3)  failed to accept Jekco’s proposal and quotation for the replacement of the traction machine and installation of rope grippers, which would otherwise have prevented the accident;

(4)  failed to follow the Guidelines for Modernising Existing Lifts (“the Guidelines”) distributed to all the lift owners in Hong Kong, including the Owners, in November 2011 for implementation of lift enhancement and modernisation solutions.

26.  In its defence to the third party claim, the Third Parties contend that the accident was caused by the improper modifications to the traction shaft which compromised its integrity, and thus increasing the stress concentration at its weak point. The Third Parties deny the alleged increase in the counterweight and the total load of the Lift as a result of the renovations of the lift car in 1997 or 2002. They also deny that such renovations required reporting to the EMSD or that they had ever misled Jekco into believing that such renovations had received EMSD approval.

27.  In any event, Jekco is said to have carried out its work on the traction shaft in the repair without regard to the state of the traction shaft and the counterweight, which it knew or ought to have known. Whilst Jekco recommended the replacement of the traction machine, it had failed to advise the Third Parties that it would be unsafe to operate the Lift in the circumstances or to advise the Third Parties to suspend the operation of the Lift unless and until the replacement of the traction machine.

28.  In reply, Jekco further contends that Hon Hing instead relied on its own engineering managers and engineers with the relevant qualifications and expertise to oversee and to examine the work carried out by it and its predecessors. The Third Parties deny that as a matter of fact. Further, the Third Parties engaged Jekco, which was expected and indeed represented itself to be competent and to possess all the necessary qualifications, expertise and knowledge in performing its duties and obligations under the various contracts, which the Third Parties did not have, the Third Parties were entitled to, and did, rely on Jekco for the discharge of their common law and statutory duties as the manager and the owners in ensuring the safety of the Lift.

29.  The Third Parties counterclaim against Jekco for damages for its negligence and/or breach of the 2012 Contract.

ISSUES

30.  In view of the undisputed fact that immediate cause of the accident was the breakage of the traction shaft of the Lift, there are the following broad issues in dispute in the third party action:

(1)  Whether the breakage of the traction shaft, and thus the accident, was the result of its having been trimmed or the increase in the total load of the Lift brought about by the renovations of the Lift in 1997 and/or 2002;

(2)  Whether Jekco and/or the Third Parties knew or ought to have known the trimming of the traction shaft and/or the increase in the load of the Lift as well as their impact on the safety of the Lift;

(3)  Whether Jekco and the Third Parties were in breach of their respective duties in respect of the safety of the Lift on account of the trimmed traction shaft and/or the increase in the counterweight;

(4)  Whether Jekco is entitled to claim contribution or indemnity against the Third Parties in respect of its liability to the plaintiff’s damage and, if yes, to what extent;

(5)  Whether the Third Parties are entitled to their counterclaim against Jekco and, if yes, the quantum.

THE WITNESSES

31.  On behalf of Jekco, Mr Chan Tak Wah (“Chan”) testified. Chan was an engineer, and at the material times director and general manager of Jekco mainly responsible for liaison and contractual matters with clients.

32.  Jekco had arranged to call another director, Mr Keung Yuk Hon (“Keung”), as a witness. Keung was at the material times the person in charge of the technical and engineering aspects of Jekco’s operation. Keung had his witness statement filed in 2017, but unfortunately passed away in 2018. As a result, Chan sought to adopt in his evidence what Keung stated. Counsel for the Third Parties questioned this approach. To the extent that they were matters either personally known by or reported to him at the material times, that in my view is permissible subject to weight.

33.  Under subpoena, Ng, who was responsible for the investigation and the FIR of EMSD mentioned above, also testified.

34.  The Third Parties called the property manager of the Building at the time, Mr Yeung Yiu Kei (“Yeung”) of Hon Hing, to give evidence. Mr Leung Man Lok (“Leung”) also testified. Leung was an engineering supervisor of Man Shine Development Company Limited (“Man Shine”), which was Hon Hing’s contractor responsible for providing daily repair and maintenance service to the Building at the material times.

35.  All the parties have engaged their respective engineering experts to provide their opinion on liability. The experts engaged on behalf of Jekco and the third parties are respectively Professor Andrew YT Leung (“Prof Leung”) and Ir Kong Sin Ming (“Ir Kong”). They compiled their respective provisional expert reports in 2019, which were followed by their mutual comments in June 2019. On 19 August 2019, they compiled their joint expert report.

36.  Following the direction of the court in April 2021, a tripartite expert meeting among the experts engaged by all 3 parties of this action was held on 3 September 2021, which led the tripartite joint expert report dated 21 September 2021 (“the Tri-P Report”). Following the settlement of the main action, the expert evidence on behalf of the plaintiff in the report remains relevant insofar this has to be related to for understanding the evidence of the experts for the remaining parties for the purpose of the third party action.

37.  The Tri-P Report contained at its end a section on the post-meeting opinion expressed by Ir Kong. This prompted Prof Leung to render his further report dated 21 June 2022 (“the 6/2022 Report”). In response of that, Ir Kong rendered his further report dated 22 July 2022 (“the 7/2022 Report”).

38.  Both experts testified at the trial.

CAUSE OF THE BREAKAGE OF THE TRACTION SHAFT

39.  Jekco and the Third Parties accept the FIR finding that the immediate cause of the accident was metal failure leading to the breakage of the traction shaft. They differ as to whether that was in turn the result of the trimming of the shaft core surface, as contended by the Third Parties, or the increase in the total weight of the Lift incidental to the renovations of the Lift in 1997 and 2002, as contended by Jekco. In either scenario, they point fingers at each other for the consequential liability[4].

The state of the traction shaft

40.  There is dispute as to whether the trimmed traction shaft with the sleeve as found was its ex-factory state or the result of subsequent alteration or modification. Jekco contends that it was the former. If Jekco is right, there would be no real issue of trimming as the same would have been part of its original manufacture state.

41.  Jekco’s case that the traction shaft with the sleeve was its original ex-factory state is essentially premised on the expert opinion of Prof Leung. In the Tri-P Report, Prof Leung opined that the shaft with the insertion of the sleeve no doubt must have existed for the Lift, and probably the whole batch of such product including lift no 8, when they were ex-factory and supplied by the manufacturer. Ir Kong (and the expert for the plaintiff) held a different view. While Ir Kong’s view aligned with that of Ng, Ng in court fairly explained that he could not be certain about whether or not the state of the traction shaft as found after the accident was ex-factory.

42.  There was indeed no record of trimming of the traction shaft in the maintenance logbook in respect of the Lift. Nor did the EMSD have such record. One needs to turn to the other available evidence.

43.  Jekco admittedly discovered the state of the traction shaft as found much earlier than the accident. It happened in the course of its repair of the traction shaft for oil leakage in October 2011. Keung in his statement to the EMSD back in March 2013 specifically referred to the discovery that the traction shaft was not in one piece but with the sleeve. Though he had no idea if the sleeve was part of the original design of the shaft, he did suspect that it was not. Only that Keung did not possess sufficient materials then to verify.

44.  Keung’s EMSD statement was taken in the presence of Chan. Chan repeated in his evidence similar suspicion in respect of the state of the traction shaft of the Lift as found, but added that Hon Hing never mentioned to Jekco whether the shaft had been modified. In court, he testified that he came to realise that the traction shaft appeared to be slimmer after the sleeve on it was removed during the repair in 2011. That was the first time he had ever encountered a traction shaft in a cylindrical shape with a sleeve, as his experience was that the ordinary shape of lift traction shaft, albeit different in dimensions, should be tier-shaped without sleeve. Worth-noting is that such observation actually aligned with the opinion of the plaintiff’s expert, who explained in the Tri-P Report that all lift practising engineers should have the technical know-how to realise that the traction shaft must be one solid piece instead of 2 pieces.

45.  Admittedly what appealed to Keung and Chan when discovering the state of the traction shaft with the sleeve in late 2011 was never investigated. What Keung and Chan then might not possess in terms of materials for verification of the state of the traction shaft, assuming that they were ever minded to do so, was subsequently obtained by the EMSD during the post-accident investigation. As appended to the FIR, the EMSD referred to what was said to be the geometry and design drawing of the model of the traction shaft of the Lift. The drawing indeed showed that the traction shaft’s ex-factory state should be in one-piece without the sleeve.

46.  There was also the EMSD statement of Mr Lo Chi Kwong (“Lo”) back in April 2013. Lo was at the time senior manager of the repair and maintenance division of Chevalier. He confirmed that Chevalier was then the sole agent of the brand of the Lift as well as the supply of its parts and components in Hong Kong. He confirmed that the ex-factory state of the traction shaft of the model in question was in one piece, and it was so when the Lift was installed. No modification to the traction shaft had been done.

47.  In the Tri-P Report, Ir Kong agreed that the drawing appended to the FIR represented the original design, diameter and geometry of the traction shaft, and the same had been modified by way of trimming in order to accommodate the insertion of the sleeve. Amongst other materials, Ir Kong had the support of the EMSD statement of Lo mentioned above.

48.  On this, counsel for Jekco submits that even Ir Kong did not think that the drawing represented the original design and geometry of the traction shaft. That in my view was not an accurate reading of Ir Kong’s evidence. Ir Kong saw the need to obtain from Chevalier detailed drawing instead of the sketch referred to. However, Ir Kong’s observation that the sketch was not drawn to scale could not be understood as acknowledgement of lack of reliability of the drawing as evidence of the original design and geometry of the traction shaft.

49.  Subsequent to the Tri-P Report, the EMSD disclosed its email correspondence with Chevalier back in November 2012, whereby Chevalier supplied the drawing of the design and geometry of the model of the traction shaft of the Lift referred to in the FIR. Chevalier in the email indeed confirmed that what the drawings depicted was the ex-factory state of the model of the traction shaft in question. In particular, the traction shaft was in one piece without the sleeve.

50.  In view of the further information, including the EMSD email with Chevalier mentioned above, Prof Leung in the 6/2022 Report added what he described as a proviso to his opinion in the Tri-P Report. He opined that the issue of whether or not the traction shaft of the Lift had been trimmed was wholly academic because the concern was when and who had done it, and whether the Third Parties had known or should have known about the trimming, bearing in mind that similar trimming and sleeve was also found on the traction shaft of lift no 8. It would appear that he held on to his view that the state of the traction shaft as found was ex-factory.

51.  In his oral evidence, Prof Leung further explained his stance. He found the evidence was insufficient to convince him that someone would have had reason to trim the original one-piece traction shaft and to insert the sleeve. To him, Lo’s EMSD statement mentioned above did not suffice. He also doubted the source and veracity of the drawing of the traction shaft design and geometry referred to in the FIR. It was only when confronted with the email from Chevalier to EMSD mentioned above that he was prepared to acknowledge the possibility that the traction shaft with the sleeve as found might have been the result of modification instead of its ex-factory state.

52.  Whether the state of the traction shaft discovered by Jekco during repair in late 2011, and as found after the accident in 2012, was its ex-factory state or the result of trimming of the shaft and insertion of the sleeve is a matter of fact to be found by this court. On the balance of probabilities, the evidence, in my judgment, suffices to show that it is more likely than not that the traction shaft of the Lift was in one-piece without the sleeve ex-factory, and its diameter had at one stage been trimmed to enable the insertion of the sleeve to match the bearing so as to seal up any gap. I so find as a matter of fact.

The state of the counterweight

53.  It is common ground that the weight of the Lift and the counterweight had bearing on the operation of the traction shaft. In the FIR, Ng did not attribute the metal failure and breakage of the shaft to the load, or any exceptional or unauthorized load, which the traction shaft in its operation had been subjected to before the accident. However, that was not because the relevance of the load of the Lift was left out of EMSD’s investigation.

54.  As mentioned, EMSD requested Jekco to find out the weight of the lift equipment after the accident, as there was no record of the weight as of the time of installation. EMSD also noticed the state of the counterweight, and wrote to Hon Hing in January 2013 to enquire about noticeable increase in the counterweight in the case of lift no 8 to ascertain its impact on the safety of the lifts. Ng had also considered the EMSD statements, as he stated so, before the final version of the FIR was released in May 2013.

55.  In court, Ng confirmed that he did consider the factor of the added weight and counterweight of the Lift, which might have been brought about by the works done to the Lift by the successive contractors prior to the accident in 2012. The works were set out by Yeung in a table (“the Table”) when giving his EMSD statement. Amongst the works recorded, those specifically referred to by Jekco for the purpose of its claim were those carried out by Holake in 1997, 2002 and 2006. The EMSD had record of the works carried out in 2006 but not those in 1997 or 2002. It should be noted that the impact of the renovation works in 2006 has by the time of the trial been removed from the core of Jekco’s case.

56.  It was after such investigation that Ng concluded the FIR with no specific mention of any causative link between the weight or counterweight of the Lift occasioned by the renovation works and the breakage of the traction shaft. As mentioned, Ng also stated in the FIR that the materials in hands caused him to report that EMSD was unable to find culpability on the part of any contractor, which in context could only be understood to be referring to the improper modification of the traction shaft. Had the renovation works in 1997 and 2002 and their impact on the load of the Lift, which were known to be carried out by Holake, been found to be a cause of the accident, there would have been no reason for its lack of mention in the FIR. In court, Ng further actually explained that the renovations recorded in the Table appeared to have been ordinary repair and maintenance. It should be noted that both the expert for the plaintiff and Ir Kong shared the opinion that those works should not have had material negative impact on the safety of the Lift.

57.  The Table was compiled with express reference to another 27 pages of documents, which were in fact expenses application forms of Hon Hing in respect of the works carried out. Those forms contained the details of such renovation works including those in 1997 and 2002 (“the 27 Pages”). According to Hon Hing, their production was not requested by EMSD during the investigation. The 27 Pages subsequently formed the subject matter of further discovery, which also brought about the original 3 parties’ argument in respect of the most recent amendment of Jekco’s pleading and further expert evidence. Hence the hearing before Hon Marlene Ng J, and her decision dated 23 April 2021.

58.  The relevant renovation works carried out by Holake in 1997 and 2002 were respectively described in the expenses application forms in the following terms:

In 1997

“客機機身三邊傍板重新裝設防火板” (or reinstallation of 3 fire-proof laminated panels on the back and side walls of the lift car);

“客機機身後幅傍板上半部安裝玻璃鏡片一件” (or installation of a glass mirror on the upper half of the back wall of the lift car);

“客機機身天花包鏡面不銹鋼片及安裝射燈5套” (or wrapping of a stainless steel panel with mirror finish and installation of 5 sets of spotlights on the ceiling of the lift car);

“客機機身企柱及模頭包鏡面不銹鋼片” (or wrapping of stainless steel panels with mirror finish on the columns and beams of the lift car);

“客機機身門傍邊兩幅防火板材料後貼為鏡面不銹鋼” (or sticking of stainless steel panels with mirror finish at the back of 2 fire-proof laminated panels of the door side of the lift car);

In 2002

“更換…升降機內殘舊之膠地板工程” (or replacing the worn out vinyl floor of the lift car).

59.  Prof Leung and Ir Kong considered the details and extent of those renovation works to the Lift in 1997 and 2002. The experts differed in respect of whether and, if yes, how much weight and counterweight had been added as a result of those renovation works. They also differed in respect of whether and, if yes, what impact that had had on the safe operation of the Lift and thus the causation of the accident.

60.  In the Tri-P Report, the experts appeared to have identified addition of about 10 pieces of counterweight. Each piece of counterweight weighed about 50kg. Hence 500kg in total. Jekco in its pleaded claim contends that the weight of the lift car was increased by 380kg and balancing increase in the counterweight to the same extent. In its reply, Jekco contends that the weight and the counterweight of the Lift were increased by 1,000kg, suggesting the increase in the weight of the lift car was 500kg. However, in his oral evidence, Prof Leung estimated that the increase in the weight of the lift car consequential upon the renovation works could be 300kg, and therefore with the corresponding increase in the counterweight the total load would have increased by 600kg instead. Margin of tolerance, in my judgment, may not suffice in reconciling the differences. Yet this tends to ring the bell for caution in terms of certainty of the expert opinion in this respect.

61.  Verification of the addition of 10 pieces of counterweight consequential upon the renovation works in 1997 and 2002 is not straightforward. Apart from the lack of documentary record, none of the experts actually had the opportunity of actually examining the counterweight. All they turned to was the state of the counterweight as depicted in the photographs taken inside the lift well. The exercise became one of judging by the colour and shade variations amongst the counterweight pieces as depicted in the photographs. The 10 pieces of counterweight mentioned above were viewed as different in terms of colour and shade from the other pieces under them in the stack. Hence the speculation that they were added at different time(s) subsequent to the those beneath them.

62.  Prof Leung’s elaboration in court also confirmed the uncertainty of the 1,000kg total weight increase. He referred to that as somehow the discussion amongst the experts when various other weights were mentioned. He acknowledged the difficulty of judging by the colour and shade of the counterweight pieces. He could only categorise the exercise as one of common sense but did not rule out its speculative nature.

63.  Unlike the experts, Ng had personally viewed the state of the counterweight after the accident. He could not be specific in his observation in this respect except for that about the top 2 pieces of the counterweight. He described those 2 top pieces as relatively shiny and reflective under lighting condition, which suggested that they did not bear much rust, and hence their relatively recent addition. Such new evidence caused the parties in the trial to factor in the possibility that the addition of the 2 pieces might be related to the renovation work to the Lift in 2002.

64.  In his reports, Ir Kong had stated his opinion that the 10 pieces of counterweight might have been added at the time when the Lift was installed. Taking into account Ng’s evidence, Ir Kong revisited his previous opinion and explained in court that he would be prepared to accept that the renovation work to the Lift in 2002, ie the replacement of the original vinyl to marble flooring, might have entailed the addition of the top 2 pieces of counterweight noticed by Ng. This also explains why counsel for the Third Parties submit that the state of the counterweight as at the time of the accident may be categorised into 3 layers in terms of noticeable colour and shade variation, of which the top layer consisted of those 2 pieces distinctly noticed by Ng.

65.  That attracted criticism by counsel for Jekco that Ir Kong was tailoring his opinion as the trial went. The criticism in my judgment is not warranted, bearing in mind the inherent nature of the basis for the experts’ opinion in this respect explained above and the fact that such personal observation of Ng about the state of the counterweight came to light only during the trial. If anything, the experts were expected to consider if their opinion previously stated called for revisit in view of the new evidence at the trial so as to assist the court.

66.  In any event, counsel for Jekco indeed proceeded in his submission on the basis that if the top 2 pieces of counterweight were attributable to the 2002 renovation works, the remaining 8 pieces should be attributable to the 1997 renovation works to the Lift. Even on this basis, the history of additions of the 8 pieces of counterweight is far from clear. Merely by viewing the colour and shade depicted in the photographs, one cannot further tell which and when those various pieces were added.

67.  First, the ex-factory lift equipment from the manufacturer came accompanied by its counterweight stack before installation. Depending on the extent of decoration to be added to the bare lift car, further counterweight would then be sourced and added. This was confirmed by Chan in his evidence. In other words, that would entail different counterweight pieces to be added to the original stack that came with the ex-factory lift package before the new and decorated lift commenced operation. Ir Kong expressed a similar understanding of the practice.

68.  Then subsequent renovation of the lift or its decoration could happen, as it did in the present case. However, whether and, if yes, how much counterweight needed to be added would depend on the change to the weight of the lift occasioned by the renovation works. Such change must be the net weight increase as renovation could entail replacement instead of pure addition of the fixtures and installations to the lift car. Ir Kong also expressed a similar view of the situation.

69.  Ir Kong drew inference from the fact that there was no EMSD record of such alteration, though this should be considered with caution, bearing in mind that the modification of the traction shaft was equally not documented in the EMSD record. Further, amongst the 27 Pages, including those regarding the Lift in 1997 as set out above, difference was apparently consciously struck when describing the works involving mere additions and those involving replacements. On this basis, one perhaps could not rule out the probability that those carried out to the Lift in 1997 could result in some net increase in the deadweight of the lift car.

70.  Indeed, both experts provided their estimations of the impact of the renovation works in 1997 on the net weight of the lift car. However, the line to be drawn between educated estimation and speculation in this respect is fine. Prof Leung seemed to accept that. Importantly, the details of those renovation works documented in the 27 Pages, without more, do not serve to show which of the experts’ estimations is probably more accurate.

71.  Apart from the recent addition of the top 2 pieces of counterweight, to what extent one manage to tell whether or not the so-called middle layer or the 8 pieces of counterweight might consist of those added upon the decoration of the Lift when installed and those added as a result of the renovation works to the Lift in 1997, is just uncertain. Jekco has to discharge the burden of substantiating its claim, including the weight issue as alleged. In the circumstances, I find that it fails to do better than showing that the state of the counterweight as found might consist of additions so added at different times for different reasons.

Causation

72.  What is certain however is that the Lift with its trimmed traction shaft had been operating subject to such weight of the lift car and the counterweight as found for a considerable number of years by the time of the accident. This constituted the circumstances in which causation of the breakage of the traction shaft, and hence the accident, should be considered.

73.  It is common ground that the breaking strength of the traction shaft refers to its strength in withstanding the bending and torsion in its operation being subject to the load generated when the lift car was loaded and unloaded. On the basis that the diameter of the traction shaft had been reduced from 100mm to 90mm (ie by 10%), Prof Leung opined that its remaining strength would be reduced to about 65% of its original state. In the Tri-P Report, Ir Kong opined that the reduction was 10%. He corrected that in his post-expert joint meeting opinion, and stated that the 10% reduction in diameter of the traction shaft should have caused reduction in the strength of the traction shaft by over 30%. Ng agreed with that in court. In other words, the experts were basically ad idem in this respect. However, they differed on the impact of such reduction in the strength of the traction shaft on the safety of the Lift in the present case.

74.  The FIR recorded the finding that the fatigue crack was originated from the outer edge of the traction shaft that had been trimmed, and the cause of the fatigue crack was the stress concentration effect from the damage induced when the original shaft was machined away to create room for insertion of the sleeve. The improper modification works compromised the integrity of the traction shaft and thereby increased the stress concentration at the weak point in its daily operation.

75.  In line with the FIR, Ng explained in court that problem originated from the trimming of the traction shaft. The trimmed traction shaft had to bear tensile and shear strength in its operation in excess of what its original state was designed to manage. That accelerated the occurrence of metal fatigue even assuming the load remained unchanged.

76.  In court, Ir Kong essentially expressed a similar view about the impact of the trimming of the traction shaft. Ir Kong opined that oil leakage faced with by Jekco months prior to the accident was a symptom of problem in the operation of the traction shaft. However, Jekco failed to possess the technical knowledge and information to identify and to address the problem properly. Hence the accident.

77.  Prof Leung stated in the Tri-P Report his opinion that the addition of weight and counterweight occasioned by the 1997 and 2002 renovations to the Lift was the sole cause of the accident. He seemed to have changed when he stated in his subsequent report that the accident was caused by the compound action of the trimming of the traction shaft and the additional load of the Lift, and that neither of the two factors alone would have caused the failure. At the trial, Prof Leung maintained that with its remaining strength, the trimmed traction shaft would still have remained safe but for the increase in the total load of the Lift as a result of the renovation works to the Lift in 1997 and 2002.

78.  As discussed, the probability that counterweight might have been added when the Lift was installed could not be ruled out. This was followed by probable additions occasioned by the subsequent renovations such as those in 1997 and 2002 in question. However, the extent of the increase attributable to these probable occasions (perhaps except for the renovation in 2002) is far from certain. What one may say with certainty is the fact that the Lift with its trimmed traction shaft had been operating subject to such total load of the Lift as found for a number of years.

79.  Prof Leung opined that the reduced strength of the traction shaft should still be within its endurance stress limit and thus safe. The lack of prior accident, in his opinion, was testimony. Problem in the form of oil leakage arose out of decades of frictional process on the traction shaft which created gaps between the shaft and the sleeve. That, in his opinion, did not constitute safety issue of the traction shaft. In court, Prof Leung added that he saw no immediate safety concern about the traction shaft in such condition. It was only when crack was detected that the shaft would be said to be close to failing.

80.  In substantiating his opinion that the traction shaft, albeit trimmed, would have remained safe but for the increase in the weight and counterweight of the Lift, Prof Leung entered into repeated calculations with a view to demonstrating that the stress level of the trimmed traction shaft would still have been within its design’s endurance limit.

81.  The calculations were initiated by the expert for the plaintiff, who tried to demonstrate that the increase in weight occasioned by the renovation works to the Lift in 1997 and 2002 was insignificant and should not have caused metal fatigue of the traction shaft without trimming. The increase in weight had minor contribution towards the fatigue condition compared with the trimming of the shaft. Prof Leung disagreed in terms of the total load adopted in the calculations and the lack of account for the cyclic stress concentration effect. That led to Prof Leung’s calculations first set out in his 6/2022 Report. It was according to his calculations that Prof Leung, as mentioned above, concluded that the traction shaft failure was due to the compound action of trimming and weight increase, and either trimming or weight increase alone would not have caused the failure.

82.  In the 7/2022 Report, Ir Kong expressed doubt about Prof Leung’s calculations. As discussed, and found by this court, the extent of increase in the weight of the lift car, and thus the counterweight, attributable to the renovation works in 1997 is uncertain. That does not lend weight to the assumed increase in the weight adopted by Prof Leung in his calculations. Ir Kong opined that even assuming the calculations were correct, the heavy use of the Lift during its daily operation would have meant that the yield stress of the Lift would have been exceeded for numerous times daily. In that case, the shaft would have been expected to change into a deformed shape permanently. Certain signs would have surfaced such as abnormal vibration and noises in the operation of the Lift as well as the tendency of the shaft and its associated components such as machine bearing to fail. The operation of the Lift would have been suspended for being unsafe. However, he found no evidence of such signs of the plastic deformation of the shaft.

83.  Unexpectedly Prof Leung sought to revise his calculations in the middle of his oral evidence, which ended up with those as now set out in and produced as Exhibit D1. He adopted a lesser increase in the counterweight, which could not be explained by taking into the 2 pieces of addition amounting to 100kg noticed by Ng as mentioned above. He adopted a lesser total load and yield stress as well. He explained in court that yield stress adopted in the original calculations was based on the assumption that the traction shaft was made of a particular type of steel. Yet for the purpose of revising his calculations in court, he decided to change the parameters by adopting the lesser yield stress.

84.  That caused query by Ir Kong as, according to him, the usual material of traction shaft was low carbon steel or mild steel with average yield strength closer, if not slightly higher than, that adopted by Prof Leung in his original calculations. The revision to the lesser yield stress was therefore not followed. Prof Leung explained that he did so by consciously leaving out of his calculations factors such as stress concentration and cyclic stress. The results fit what he had in mind, and allowed him to work his way backward. The experts acknowledged that factors such as stress concentration and cyclic stress, which Prof Leung removed from his revised calculations, could account for ±5-10% deviations. Even factoring those back in, the yield stress would still have been less than the case of the type of steel of which traction shaft was normally made.

85.  Ir Kong also pointed out various other difficulties in accepting the revised calculations on the basis of the known and unknown circumstances surrounding the Lift at the time. This court sees the force of the argument on behalf of the Third Parties that one should guard against tendency of effective manipulation of parameters for the purpose of certain perceived outcome when not all the variables in the entire computation were certain.

86.  Ir Kong gave another reason why one should be on guard about relying on Prof Leung’s calculations to determine the causation of the accident. Essentially, Ir Kong pointed out the reality of factoring in the usage of the lift at the design stage for safety and therefore certain margin other than what the calculations might seek to demonstrate would be expected. A buffer of 30-40% in the design, he opined. That sounds convincing. At least insofar as passengers’ lifts are concerned, the bare lift equipment to be installed would be delivered accompanied with counterweight as part of the package. As discussed, other counterweight would be added at the installation stage in accordance with the weight increase occasioned by the specific interior fittings and decorations to be added to the lift. That the design of the lift would cater for such weight buffer in the first place, as Ir Kong suggested, sounds convincing. This also lends weight to the probability that addition to the counterweight so occasioned at the installation stage might not have been offensive to the tolerance and thus safety of the lift.

87.  I share the scepticism about placing the extent of reliance on the calculations tendered by Prof Leung in the manner as mentioned for the purpose of drawing the conclusion contended by Jekco, namely the traction shaft of the Lift, albeit trimmed as found, would have been safe but for the increase in the counterweight occasioned by the renovation works in 1997 and 2002. The same is the case for the purpose of determining the duties of the parties arising out of knowledge about the state of the counterweight and the traction shaft, which will be discussed below.

88.  Jekco fails to prove on the balance of probabilities the extent and timing of the addition of the counterweight brought about the renovation works to the Lift in 1997 as alleged. Now the expert opinion of Prof Leung on the basis of his calculations left one with reasonable queries than definite answer in respect of the link between the increased load and premature metal failure as the alleged sole cause of the breakage of the traction shaft of the Lift in the present case. This court must question how far the evidence adduced by Jekco manage to tell us about the causation of the accident in more concrete terms than first, the trimmed traction shaft compromised its integrity and strength in withstanding the total load of the Lift; and second, as once stated in Prof Leung’s own opinion, that the traction shaft failed as a result of the compound effect of trimming of the shaft and the increase in load.

DUTIES

89.  Jekco was not accountable for the trimming of the traction shaft or any increase in the total load of the Lift. However, the fact was that the Lift with its trimmed traction shaft had been operating subject to the total load of the Lift as found at the time of the accident for some time by the time when Jekco took over as the lift contractor in January 2008. The situation was allowed to continue until the accident happened in 2012. That was the starting point in considering the respective duties on the part of Jekco and the Third Parties as well as which of the two sides was in breach in causing the accident.

The Third Parties

90.  Pursuant to the management agreement and sub-deed of mutual covenant concerning the Building, Hon Hing as the management company agreed to manage and to provide services for the whole of the Building as provided in the deed, and Hon Hing should have all the rights, powers and authorities and should perform all such duties and functions as were provided in the deed. Those included keeping the lifts of the Building in good repair and condition and replacing any parts thereof when Hon Hing considered to be necessary.

91.  As for statutory duty, it became clear at the trial that at the material times, the LESO was the applicable legislation. It was repealed after the accident by the Lifts and Escalators Ordinance, Cap 618 (“LEO”) on 17 December 2012. The Owners, as such of the lifts of the Building, were subject to the LESO at the time of the accident in respect of the safety of the lifts.

92.  Whilst Hon Hing, as the manager of the Building, was strictly outside the ambit of “owner” of the lifts for the purpose of the LESO, it was a party having occupation, management or control of the lifts as a matter of fact, which gave rise to the common law duty of ensuring the safety of the same as premises to which the lawful visitors of the lifts, including the plaintiff, would have access.

93.  Jekco argues that the Third Parties were at the material times also under the duties as the “responsible persons”, which came to be defined under the LEO and the 2012 version of the Code of Practice for Lift Works and Escalator Works (“the Code”), the latter being introduced to give guidance as a result of the changes brought about by the LEO. It became clear at the trial that it was the 2010 version instead of the 2012 version of the Code that was applicable in the present case.

94.  That aside, the 2012 version of the Code provided that the “responsible persons” under the new provisions have the ultimate responsibilities for the upkeep of a lift in a proper state of repair and safe working order (see Part 3, clause 3.1.2). Insofar as that is concerned, it does not appear that the Third Parties ever deny that their duty vis-à-vis the users of the lifts was non-delegable even under the current state of the law. What they contend is that they had therefore contracted and delegated the execution of the repair and maintenance of the lifts to competent registered contractors, including Jekco, with the provision of the necessary advice and operation for the compliance with the statutory and common law duties on their parts. It should be noted that the 2012 version of the Code indeed follows by stating that the “responsible persons” are required to cause registered contractors and registered engineers to respectively maintain and examine the lifts to fulfil the statutory requirements. That was what the Third Parties had done.

Jekco

95.  Jekco first undertook its duty as the contractor responsible for the repair and maintenance of the lifts of the Building both as the lifts were in January 2008 and in accordance with the terms of the contracts entered with Hon Hing for and on behalf the Owners.

96.  Counsel for Jekco suggests that it is common ground that the 2008 Contract and the 2010 Contract had lapsed by the time of the accident and therefore only the 2012 Contract is relevant. No doubt the Third Parties’ counterclaim is for breach of the 2012 Contract. However, that does not render the previous contracts irrelevant, as their terms provided the measure of the contractual duties on the part of Jekco in respect of ensuring the safety of the Lift in the circumstances surrounding the Lift and prevailing at the time.

97.  The terms of the contracts were set out in the tender documents. For the following purpose, the “tenderer” or “successful tenderer” in the provisions will be referred to as the contractor in the explanation.

98.  Under the 2008 Contract, Jekco had the following general duties:

Clause 3.10.2:

“在執行本公司合約時，倘中標判商或其僱員因任何疏忽行為引致本公司之動產或不動產或代管之財產受損壞或損失，或引致本司遭受控告而被索償引致本公司蒙受任何損失，中標判商須負全部負任，並補償本公司因而引起之一切損失。”

Essentially, in the event of loss and damage arising out of property damage, prosecution or claim against Hon Hing as a result of the negligence of the contractor or its employees, the tenderer should be wholly responsible and undertake to compensate Hon Hing.

Clause 4.1.4:

“服務範圍：8部升降機相關設施之檢査／保養／維修等。”

Essentially, the contractor’s service included inspection, maintenance and repair of the 8 lifts and their related facilities.

Clause 4.3:

“更新工程及保養工作須遵從『香港法例第327章升降機及自動電梯 (安全) 條例』及機電工程署或政府其他有關部門所制定之作業備考管制，並應符合機電工程署所編訂之「升降機及自動梯檢驗測試及保養實務守則」及「安全使用升降機及自動梯」之要求，中標判商代表升降機／電梯之業主執行上述法例所訂之工作及職責。”

Essentially, the improvement and maintenance work should be executed in compliance with the LESO (Lifts and Escalators (Safety) Ordinance (Cap. 327) (“LESO”) and the practice guidelines published by the EMSD and other Government departments as well as the requirements under the EMSD code of practice. The contractor should execute the work and duties under the LESO for and on their behalf of the Owners.

Clause 4.4:

“升降機／電梯保養工程投標商必須為香港機電工程署註冊之升降機承建商 (Registered Lift Contractor) 及具備認可升降機／電梯工程師 (Registered Lift Engineer) 之專業資格人士執行訂明之工作，方可合乎投標要求，而有關牌照副本須隨本標書夾附以便本公司査閱。”

Essentially, the contractor must possess the professional qualification of registered lift contractor and registered lift engineer for the discharge of their relevant duties.

Clause 4.6:

“中標判商在獲悉中標後，管業處將安排中標判商與現時大廈之升降機保養商進行會議。中標判商在獲得現時大廈升降機保養商同意後，需安排技術人員視察／檢查有關升降機系統之運作 (包括機械部份，電器部份及電子控制部份)，以確定升降機之裝置運作情況，並於進行此工序後一星期內，提交詳細報告書及建議書給予本公司作存案及跟進之用。”

Essentially, upon successful tender, Hon Hing would arrange the meeting between the (new) contractor and the current lift contractor. With the current contractor’s consent, the (new) contractor should arrange inspection and examination of the lifts, including their engineering and electronic parts, to ascertain their operation condition as well as report to Hon Hing within a week.

Clause 4.7:

“承辦商需要負責1-8號升降機 (高層及低層) 控制組件包括控制櫃及相關之電力及安全裝置，及完成後簽發證明書 (FORM 7)，測試報告及升降機操作手冊一式2份及呈交到本公司。新裝設之電腦控制系統，必須可為多部升降機作聯組控制 (分別為高層、低層及消防升降機，共8部)，及包括升降機箱內照明及通風之自動節能裝置；而於保養期內，本處有權要求承辦商不限次數修改控制程式，以附合大廈之使用及用量要求。保養之裝置包括但不局限以下項目：電腦控制系統 Elevator controller，變壓變頻升降機驅動器 VVVF Lift Drive, 控制櫃Control Cabinet，升降機箱控制板 Control Panel (Lift Cart),升降機箱內及升降機大堂㩒手板及顯示屏 Lift Car and Hall Call Panel and Dot Matrix Display (Lift Car & Each Lift lobby)，升降機控制纜 Elevator Controller cable and 遙遠監察系統 Remote monitoring system。”

This set out the various parts of the new control system of the lifts which the contractor agreed to provide.

Clause 4.9:

“如因為中標判商的工作疏忽或錯誤而引致任何損失或引致傷亡，中標判商必須承擔全部責任。中標判商承諾補償本公司因中標判商的疏忽或錯誤而蒙受的直接損失及費用。”

Essentially, the contractor should be solely liable for any loss, damage and personal injuries arising out of its negligence and mistake in its work. It agreed to indemnify Hon Hing against any loss and expenses caused by such negligence or mistake.

Clause 4.11:

“所有維修工作的進行程序及守則，必須達致、符合香港機電工程署所訂的最新要求及準則。”

Essentially, the repair and maintenance work procedures carried out should accord with the latest requirement and standards set down by the EMSD.

Clause 4.16:

“中標判商須每月一次派遣工程師與管業處開會, 檢討有關大廈之升降機系統狀況及跟進有關維修及改善工程，有需要時，須提交書面報告。”

Essentially, the contractor’s representative should meet with the management office monthly to review the condition and progress of repair and improvement works of the lifts and, if necessary, to table written report.

Clause 4.17:

“在落標前，投標商必須前往大廈作實地視察，對工程範圍及現場環境深入了解，但需先與大廈管業處聯絡以便作出安排。”

The contractor must arrange with the management office to conduct a site visit so as to acquaint itself with the scope of work and site condition prior to tender.

Clause 4.25:

“所有更換或後加之工程必須達致、符合香港機電工程署所訂的最新要求及準則，或政府其他有關部門所制定之作業備考管制及有關之法例。”

Essentially, replacement and additional works must satisfy the latest requirements and standards set by the EMSD or other code of practice of other relevant authorities and legislations.

Clause 5.7:

“中標判商需不另收費負責下列人工及物料：………任何非人為破壞而須維修／更換零件【包括：機械部份，電器控制部份及電子控制部份】。任何非人為破壞而須維修／更換機件【包括：運作鋼纜，運作電纜，運作摩打，運作滑輪組，光管及燈及啤呤等】。”

Essentially, the contractor should be responsible for the supply of work and materials free of charge, including any repair or replacement of parts necessitated other than human damage (such as engineering and electronic control), repair or replacement of mechanical parts (such as operation wires and ropes, motor, pulley, fluorescent tubes and bearing).

Clause 5.9:

“上述保養費為全保保養即正常使用下的自然損耗 (包括鋼纜及馬達) 將免費更換。”

Essentially, the agreed service charge should cover the provision of comprehensive maintenance of normal wear and tear (including wire/ropes and motor) and free replacement.

99.  Under the 2010 contract, Jekco had the following general duties:

Clause 4.1:

“升降機／電梯保養工程投標商必須為香港機電工程署註冊及認可之升降機承建商 (Registered Lift Contractor) 及具備認可升降機／電梯工程師 (Registered Lift Engineer) 之專業資格人士執行訂明之工作，方可合乎投標要求，而有關牌照副本須隨本標書夾附以便本公司査閱。”

This essentially repeated clause 4.4 of the 2008 Contract.

Clause 4.2.4:

“服務範圍：8部升降機（其中客運升降機4部及貨運升降機4部）及其相關設施之檢查／保養／維修等。”

This essentially repeated clause 4.1.4 of the 2008 Contract.

Clause 4.6:

“中標判商在獲悉中標後，管業處將安排中標判商與現時大廈之電梯保養商進行會議。中標判商在獲得現時大廈電梯保養商同意後，需安排技術人員視察／檢查有關升降機及扶手電梯系統之運作﹙包括機械部份，電器部份及電子控制部份﹚，以確定升降機及扶手電梯之裝置運作情況，並於進行此工序後一星期內，提交詳細報告書及建議書給予本公司作存案及跟進之用。”

This essentially repeated clause 4.6 of the 2008 Contract.

Clause 4.7:

“承辦商需要負責所有升降機 (所有層數) 控制組件包括控制櫃、相關之電力及安全裝置、所有機械系統與電子控制系統之保養，及包括升降機箱內照明及通風裝置；而於保養期內，本公司有權要求承辦商修改控制程式，以附合大廈之使用及用量要求。保養之裝置包括但不局限以下項目：控制系統 Elevator controller, 升降機驅動器 Lift Drive, 控制櫃Cabinet, 升降機箱控制板 Control Panel (Lift Cart), 升降機箱內及升降機大堂㩒手板及顯示屏 Lift Car and Hall Call Panel and Dot Matrix Display (Lift Car & Each Lift lobby), 升降機箱內門及各樓層外門操作器 Inner Door & Outer Door Operator (Lift Car & Each Lift lobby) and 升降機控制纜 Elevator Controller cable。”

This essentially repeated the scope of maintenance under clause 4.7 of the 2008 Contract.

Clause 4.9:

“如因為中標判商的工作疏忽或錯誤而引致任何損失或引致傷亡，中標判商必須承擔全部責任。中標判商承諾補償本公司因中標判商的疏忽或錯誤而蒙受的直接損失及費用。”

This repeated clause 4.9 of the 2008 Contract.

Clause 4.11:

“所有保養及維修工作的進行程序及物料等，必須達致符合香港機電程署所訂的最新要求及標準。”

This repeated clause 4.11 of the 2008 Contract.

Clause 4.16:

“在落標前，投標商必須前往大廈作實地視察，對工作範圍及現場環境深入了解，但需先與大廈管業處聯絡以便作出安排。”

This repeated clause 4.17 of the 2008 Contract.

Clause 4.18:

“若因中標公司過失或失誤導致升降機服務嚴重延誤或停止，中標公司須承擔因此而引起之相關責任及損失。”

Essentially, the contractor should be responsible for any loss arising out of any delay or cessation of the lift service due to its mistake.

Clause 5.9:

“中標判商需不另收費負責供應及更換自然損耗的物料及設施，包括但不局限下列人工及物料： ………任何非人為破壞而須維修／更換零件【包括：機械部份，電器控制部份及電子控制部份】。任何非人為破壞而須維修／更換機件【包括：運作鋼纜，運作電纜，運作摩打，運作滑輪組，升降機門閘刀，光管、燈及啤呤等】。”

This essentially repeated the combined effect of clauses 5.7 and 5.9 of the 2008 Contract.

100.  In addition, Jekco was contractually obliged to comply with the relevant statutory duties at the material time:

Clause 4.1:

“升降機／電梯保養工程投標商必須為香港機電工程署註冊及認可之升降機承建商 (Registered Lift Contractor) 及具備認可升降機／電梯工程師 (Registered Lift Engineer) 之專業資格人士執行訂明之工作，方可合乎投標要求，而有關牌照副本須隨本標書夾附以便本公司査閱。”

This essentially repeated clause 4.4 of the 2008 Contract.

Clause 4.4:

“保養工作須遵從『香港法例第327章升降機及自動電梯 (安全) 條例』及機電工程署或政府其他有關部門所制定之作業備考管制，並應符合機電工程署所編訂之「升降機及自動梯檢驗測試及保養實務守則」及「安全使用升降機及自動梯」等要求，中標判商代表升降機／電梯之業主執行上述及最新法例所訂之工作及職責。”

Clause 5:

“中標判商其保養工作須遵從『香港法例第327章升降機及自動電梯（安全）條例』及合約期內由機電工程署或政府其他有關部門所制定之作業備考管制，並應符合機電工程署所編訂之「升降機及自動梯檢驗測試及保養實務守則」及「安全使用升降機及自動梯」之要求，中標判商代表升降機／電梯之業主執行上述法例所訂之工作及職責，並負責以下之工作包 括但不局限下列：

接管現有裝置至合約中止或到期日移交有關裝置給僱主…”

Clauses 4.4 and 5 essentially repeated clause 4.3 of the 2008 Contract.

101.  Under the 2012 contract, Jekco had the following duties:

Clause 4.2:

“升降機／電梯保養工程投標商必須為香港機電工程署註冊之升降機承建商 (Registered Lift Contractor) 及具備認可升降機／電梯工程師 (Registered Lift Engineer) 之專業資格人士執行訂明之工作，並在註冊後最少5年有關升降機維修、保養及翻新經驗，方可合乎投標要求，而有關牌照副本及工作履歷須隨本標書夾附以便本公司査閱。”

Apart from repeating similar term as set out in clause 4.4 of the 2008 Contract and clause 4.1 of the 2010 Contract, there was now the additional requirement that the contractor possessed not less than 5 years of experience in lift repair, maintenance and renovation.

Clause 4.11:

“中標判商在獲悉中標後，管業處將安排中標判商與現時大廈之電梯保養商進行會議。中標判商在獲得現時大廈電梯保養商同意後，需安排技術人員視察／檢查有關升降機系統之運作 (包括機械部份，電器部份及電子控制部份)，以確定升降機之裝置運作情況，並於進行此工序後一星期內，提交詳細報告書及建議書給予本公司作存案及跟進之用。”

This contained similar terms as in clause 4.6 of the 2008 Contract and clause 4.6 of the 2010 Contract.

Clause 4.12:

“如因為中標判商的工作疏忽或錯誤而引致任何損失或引致傷亡，中標判商必須承擔全部責任。中標判商承諾補償本公司因中標判商的疏忽或錯誤而蒙受的直接損失及費用。”

This contained similar term as in clause 4.9 of the 2008 Contract and clause 4.9 of the 2010 Contract.

Clause 4.17:

“在落標前，投標商必須前往大廈作實地視察，對工程範圍及現場環境深入了解，但需預先與大廈管業處聯絡以便作出安排。”

This contained similar term as in clause 4.17 of the 2008 Contract and clause 4.16 of the 2010 Contract.

Clause 5.1:

“保養合約適用 獲承接「福業大廈」升降機「全保合約」保養工程判商 (以下簡稱：中標判商)，其保養工作須遵從『香港法例第327章升降機及自動電梯 (安全) 條例』及合約期內由機電工程署或政府其他有關部門所制定之作業備考管制，並應符合機電工程署所編訂之「升降機及自動梯檢驗測試及保養實務守則」及「安全使用升降機及 自動梯」之要求，中標判商代表升降機／電梯之業主執行上述法例所訂之工作及職責，並負責以下之工作包括但不局限於下列:”

This contained similar term as in clause 4.3 of the 2008 Contract and clauses 4.4 and 5 of the 2010 Contract.

Clause 5.2:

“中標判商須安排技術人員進行以下各項有關升降機之檢査及法定保養工作，並制定定期檢査／保養時間表供大廈管業署審批：如必須長時間暫停客運升降機進行保養工程時，爲避免貨運升降機停頓太久而影響客戶正常使用。是項保養工作必需獲大廈管業處安排在指定日期進行，而中標判商必須遵從。保養工作包括檢査、清潔、抹油及調校升降機但不局限於以下內容：

5.2.1 每兩星期1次檢査、清潔、抹油及調校升降機。

5.2.2 每年1次對升降機作全面檢査 (包括機械部份，電器部份及電子控制部份)。

5.2.3 每年l次定期試驗安全設備。

5.2.4 每5年1次安全設備滿載試驗及空載測試，超載感應器和制動器調較及應本公司因應實際情況之要求而進行。

＊倘上列檢査部份須向機電工程署申報，中標判商須知會本公司及須作安排。”

This essentially set out in detail the regular maintenance to be provided by the contractor, including:

(1)  Biweekly inspection, cleaning, lubricating and adjustment of the lifts;

(2)  Annual comprehensive inspection, including that of the mechanical, electrical and electronic parts;

(3)  Annual test of the safety devices.

Further, the contractor should advise Hon Hing of any need to arrange for the reporting of any of the above work to the EMSD.

Clause 5.5:

“中標判商需不另收費負責下列人工及物料：－

5.5.1 潤滑油添加劑。

5.5.2 鋼纜防腐添加劑。

5.5.3 機器運作機油／偈油。

5.5.4 抹油棉威士／威士布。

5.5.5 升降機身內和樓層指示燈／按手控制裝置及其他有關維修必須使用之物料。

5.5.6 任何非人爲破壞而須維修/更換零件【包括：機械部份，電器控制部份及電子控制部份】。

5.5.7 任何非人爲破壞而須維修／更換機件【包括：運作鋼纜，運作電纜，運作摩打，運作滑輪及機器等大型零件等】。”

This set out the scope of the work and materials to be provided by the contractor free of charge, including those as in clause 5.7 of the 2008 Contract and clause 5.9 of the 2010 Contract.

Clause 5.8:

“中標判商在獲悉中標後，管業處將安排中標判商與現時大廈之電梯保養商進行會議。中標判商在獲得現時大廈電梯保養商同意後，需安排技術人員視察／檢査有關升降機系統之運作（包括機械部份，電器部份及電子控制部份），以確定升降機之裝置運作情況，並於進行此工序後一星期內，提交詳細報告書及建議書給予本公司作存案及跟進之用。”

This contained similar term as in clause 4.6 of the 2008 Contract and clause 4.6 of the 2010 Contract.

Clause 5.10:

“中標判商需要負責1、2、5及6號升降機 (所有層數) 控制組件包括控制櫃、相關之電力及安全裝置、所有機械系統與電子控制系統之保養，並包括升降機箱內照明及通風裝置和對講機；而於保養期內，本處有權要求承辦商修改控制程式，以附合大廈之使用及用量要求。保養之裝置包括但不局限以下項目：控制系統 Elevator controller, 升降機驅動器 Lift Drive，控制櫃 Control Cabinet，升降機箱控制板 Control Panel (Lift Cart), 升降機箱內及升降機大堂拎手板及顯示屏 Lift Cart and Hall Call Panel and LCD Display (Lift Cart & Each Lift lobby)，升降機箱內門及各樓層外門操作器 Inner Door & Outer Door Operator (Lift Cart & Each Lift lobby) and 升降機控制纜 Elevator Controller cable.”

This contained similar term as in clause 4.7 of the 2008 Contract and clause 4.7 of the 2010 Contract.

Clause 5.12:

“如因爲中標判商的工作疏忽或錯誤而引致任何損失或引致傷亡，中標判商必須承擔全部責任。中標判商承諾補償本公司因中標判商的疏忽或錯誤而蒙受的直接損失及費用。”

This contained similar term as in clause 4.9 of the 2008 Contract and 4.9 of the 2010 Contract.

Clause 5.17:

“在落標前，投標商必須前往大廈作實地視察，對工作範圍及現場環境深入了解，但需先與大廈管業處聯絡以便作出安排。”

This contained similar term as in clause 4.17 of the 2008 Contract and 4.16 of the 2010 Contract.

Clause 7.4.3:

“保養工作：基本責任：中標判商必需按標書內所有內容及細則等執行工程。”

Clause 7.5:

“保養工作：提供1-8號客／貨運升降機之全保保養服務：按照第5.0所述事項，為福業大廈提供1-8號客／貨運升降機全保保養服務。”

Clauses 7.4.3 and 7.5 essentially provided that the contractor should carry out the maintenance work in respect of the 8 lifts in accordance with the terms of the contract.

102.  Likewise, the 2012 contract contractually required Jekco to comply with the following statutory duties:

Clause 4.2:

“升降機／電梯保養工程投標商必須為香港機電工程署註冊之升降機承建商 (Registered Lift Contractor) 及具備認可升降機／電梯工程師 (Registered Lift Engineer) 之專業資格人士執行訂明之工作，並在註冊後最少5年有關升降機維修、保養及翻新經驗，方可合乎投標要求，而有關牌照副本及工作履歷須隨本標書夾附以便本公司査閱。”

This was similar to clause 4.4 of the 2008 Contract and clause 4.1 of the 2010 Contract.

Clause 4.14:

“所有維修工作的進行程序及守則，必須達致符合香港機電工程署所訂的最新要求及準則。”

Clause 5.1:

“中標判商其保養工作須遵從「香港法例第327章升降機及自動電梯 (安全) 條例」及合約期內由機電工程署或政府其他有關部門所制定之作業備考管制，並應符合機電工程署所編訂之「升降機及自動梯檢驗測試及保養實務守則」及「安全使用升降機及自動梯」之要求，中標判商代表升降機／電梯之業主執行上述法例所訂之工作及職責。”

Clause 5.14:

“所有維修工作的進行程序及守則，必須達致、符合香港機電工程署所訂的最新要求及準則。”

Clause 5.23:

“升降機安全裝置及設備更新／提升

所有升降機之保養工作必須達致、符合香港機電工程署所訂的最新要求及準則，或政府其他有關部門所制定之作業備考管制及有關之法例。

投標商需於投標前到地盤視察各升降機房及升降機，並識別現有升降機狀況是否符合現行機電工程署有關升降機安全裝備之要求，中標判商有責任於合約期內，將有關不合格之裝備提升至法例最新之要求而不可另收費用，當中包括轉動部份之安全罩，升降機頂圍欄等設備。”

Clauses 4.14, 5.1, 5.14 and 5.23 contained terms similar to clauses 4.3, 4.11 and 4.25 of the 2008 Contract as well as clauses 4.11, 4.4 and 5 of the 2010 Contract. Clause 5.23 also provided that the contractor had the duty before tender to conduct a site visit and to ascertain if the pre-existing condition of the lifts satisfied the safety requirements published by the EMSD. The contractor had the duty during its term to bring the condition of the lifts which was below standard up to the latest requirements under the legislation without further charge.

103.  Section 11J of the LESO provides:

“A registered lift contractor…shall –

(b) supervise the carrying out of any lift works…which he is engaged to carry out;

(c) ensure that any lift works…which he is engaged to carry out are carried out by a person specified in section 29A(1), (2), (3), as the case may be;

(d) carry out any lift works…which he is engaged in accordance with the provisions of this Ordinance;

(da) ensure that the design and construction of the lift…concerned complies with section 27I;

(e) in carrying out lift works…, ensure that adequate safety precautions are taken to prevent injury to any person;

…”

104.  Section C, clause 2.3 of the Code (2010) provided that the registered contractor would have to carry out periodic maintenance and accident investigation, keep the equipment in good working condition and ensure that the requirements of the LESO are complied with. Clause 4.1 of the Code defines what maintenance and repair works respectively would include:

“Maintenance includes the inspecting, cleaning, oiling and adjusting of a lift…in order to keep the equipment and their accessories in good working order and prevent faults from occurring….Repair works cover the fault attending and fault finding activities as well as the action and work to restore the equipment or accessories to good working condition.”

105.  As provided in the various contracts with Hon Hing, it was also the contractual duty of Jekco to comply with its statutory duties as well as to perform in compliance with the statutory duties on the part of the Third Parties for and on their behalf.

106.  Apart from acting in accordance with the terms of its contract, where Jekco undertook the provision of services for Hon Hing which relied on it for such services, Jekco must assume the common law duty to Hon Hing (and the Owners) to exercise the necessary skill and care in providing such services: see Charlesworth & Percy on Negligence (14^th ed) §2-100; Haseldine v CA Daw & Son Ltd [1941] 2 KB 343.

BREACH

107.  On the basis that the physical cause of the accident is said to have been the state of the counterweight occasioned by the renovation works to the Lift in 1997 and 2002, and hence before its term as the lift contractor, Jekco contends that the accident was the result of the following breach of duties on the part of the Third Parties:

(1)  failing to report to EMSD the major alterations of the Lift involving the increase in the load of the Lift incidental to the renovation works in 1997 and 2002;

(2)  failing to inform Jekco of the same when it took over as the lift contractor;

(3)  failing to accept the recommendation of Jekco to replace the traction machine and/or to install rope grippers to the Lift;

(4)  failing to follow the Guidelines.

Reporting major alterations of the Lift

108.  Regarding commencement of major alterations in lift works, section 33 of the LESO provides:

“Where any lift works which consist, either wholly or in part, of major alterations are to be carried out in respect of any lift and…, the registered lift contractor…, as the case may be, engaged to carry out such lift works…, shall, as soon as practicable and, in any event, before such works are commenced, in writing notify the Director of the works which are to be carried out.”

109.  It is common ground that work involving increase in the deadweight of the lift car would fall within the scope of major alterations for the purpose of the LESO: see section 4(b).

110.  Section 13 of the LESO provides for the reporting procedure in respect of lift works involving major alterations:

“(1) Where any lift works which consist, either wholly or in part, of major alterations have been carried out in respect of any lift…, the owner of the lift…shall before the normal use and operation thereof is resumed, cause the lift…to be examined and tested by a registered lift engineer…, as the case may be, so far as may be necessary to determine that those parts of the lift…affected by such lift works…are in safe working order.

(2) When the registered lift engineer…, as the case may be, is satisfied that such parts of the lift…are in safe working order, he shall deliver to the owner of the lift…a certificate in the specified form, and the owner shall deliver the certificate, and pay the prescribed fee, to the Director within 7 days of the receipt of the certificate by the owner.

(3) On receipt of the certificate and the prescribed fee under subsection (2), the Director shall-

(a) if he is satisfied that such parts of the lift or escalator are in safe working order, by notice in the specified form permit the use and operation of the lift or escalator to be resumed;

(b) if he is not so satisfied, refused or permit the use or operation of the lift or escalator to be resumed;

(4) The Director shall be deemed to have permitted the use and operation of the lift or escalator to be resumed unless, within the period and in the manner prescribed by section 14(1), he notified the owner thereof that he refuses to permit the use or operation of the same to eb resumed.”

111.  The Third Parties were undoubtedly aware of the renovation works to the Lift in 1997 and 2002. The renovation works were carried out when Holake was the responsible registered lift contractor of the Building. One would reasonably expect the Third Parties to have to rely on Holake for information, advice and action in respect of any part of those works falling within the ambit of major alterations and thus entailing the need for examination by a registered lift engineer. If such examination by a registered lift engineer was required and thus caused to be carried out through the registered lift engineer, the certificate envisaged under section 13(2) would have been issued. The duty of the Owners upon receipt of the engineer’s certificate would be to deliver the same to the EMSD and to pay the prescribed fees in compliance with section 13(2). The Owners would not be in a position to do so without the certificate.

112.  Insofar as works done to the Lift is concerned, the EMSD indeed recorded an instance of such report in 2006 when Holake was the responsible lift contractor of the Building. In other words, there is no reason for suspecting that Holake was unaware of such statutory requirement. There is no evidence to suggest that the Owners either disregarded or failed to act according to any such advice by Holake in respect of the renovation works to the Lift in 1997 and 2002. Nor is there evidence to suggest that a registered engineer’s certificate had been issued in respect of such works which either Holake had failed to deliver to the Third Parties or the Third Parties had failed to deliver the same to the EMSD to complete the reporting duty.

113.  In the circumstances, Jekco cannot attribute blame to the Third Parties for breach of the statutory duty under sections 13 and 33 of the LESO for its purpose in these proceedings, when it is not proved that the Third Parties then possessed what would have necessary to enable the Owners to comply with such reporting duty at the relevant times.

114.  In any event, Jekco fails to make good its cause of claim on the basis of the alleged breach of the statutory duty to report. The physical cause of the accident is said to have been the state of the counterweight. As found above, the precise extent of any increase in the counterweight occasioned by the renovation works, which was in fact offensive, is uncertain. In the circumstances, it is not established how the duty to report the major alterations in those renovation works per se, had it been complied with at the relevant times, would have prevented such physical cause from existing and hence the eventual accident. Any suggestion in this respect, which is not actually made, would have been conjecture in the absence of particulars and evidence.

115.  What the evidence however tells is the state of the counterweight, which is said to be the physical cause of the accident, was patent to Jekco when it took over as the lift contractor in 2008.

The state of the counterweight as it was

116.  According to Jekco, its workmen first discovered on or about 15 March 2010 the state of the counterweight as it was found after the accident. According to Chan, that happened on the occasion when Jekco’s workmen happened to enter the lift well to fix the lighting problem inside. That was also when some of the photographs depicting the lift well and the counterweight referred to by the experts were taken.

117.  However, that could hardly be the only or even the first occasion when Jekco had to send its workmen into the lift well. Pursuant to the terms of the consecutive contracts with Hon Hing mentioned above, Jekco was required to carry out inspection of all the lift systems at the commencement of each of the term of its contract as well as annually. That began in January 2008. That is not to mention the other repair and maintenance throughout the years since 2008 inside the lift well. Ir Kong gave evidence in respect of similar requirement and duty of the contractor. In court, Chan also confirmed the same.

118.  In other words, where the counterweight is said to consist of additions incidental to the renovation works to the Lift mostly in 1997 and some in 2002, its state as of 2008 should be patent when Jekco took over its maintenance. As Chan acknowledged in his oral evidence, such state of the counterweight should be patent during inspection or repair inside the lift well since 2008, not only 2 years later in 2010. Should there be any observation or concern about such state of the counterweight, as Jekco alleges, that should not have arisen only when its workmen happened to work on the lighting inside the lift well in March 2010.

119.  As the Lift had been operating subject to the state of the counterweight as found for years by the time when Jekco came to notice that, one can therefore understand why the Third Parties argue that by complaining about their failure to inform it of what would have been concern about the state of counterweight, Jekco is effectively reversing or shifting its duty as the lift contractors back to them. Jekco should have been under the duty to alert the Third Parties to the situation even before March 2010.

120.  There is no dispute that Hon Hing kept the 27 Pages in respect of the renovation works to the lifts in the record. However, as discussed, that would not put the Third Parties on notice of any incidental adjustment in the counterweight or the duty envisaged under the LESO unless so advised at the time. Ir Kong also opined, and I accept, that it would not be reasonable to expect the property manager and owners of the building, who did not possess the technical knowledge about the operation of the lift, to see to the compliance with the statutory duties and obligations imposed on a registered lift contractor. Since January 2008, it had become the contractual obligation of Jekco, for instance under clause 4.4 of the 2010 Contract and clause 5.1 of the 2012 Contract, to execute the work in compliance with the statutory duties for and on behalf of the Owners.

121.  The basis for Jekco to hold a different view is that Hon Hing is said to have its own engineers and engineering manager to oversee the work of Jekco. Reference is made to the fact that Man Shine belongs to Nam Fung Group, which runs, amongst others, property development business. Reference is also made to the fact that engineers from Man Shine were present when statements were taken from the personnel of Jekco at the EMSD after the accident.

122.  That Hon Hing had its general engineering personnel is not disputed. One of the witnesses, Leung, was from Man Shine which was the contractor responsible for providing daily repair and maintenance service to the Building at the material time. However, there is no evidence to substantiate the assertion that such general contractor and its personnel were somehow qualified, let alone put in place, to oversee the work of the registered lift contractor of the Building such as Jekco. When the accident happened at the time when Jekco was the responsible lift contractor, that Hon Hing would cause engineers either from Man Shine or its group of companies to attend the statement taking at the EMSD as part of the post-accident investigation is not evidence of Jekco’s assertion in respect of their alleged roles during its term.

123.  Chan also suggested that Hon Hing’s engineer had been present in their representatives’ management meeting, and he witnessed that the engineer would converse with the Chairman of the management committee about the matters spoken of by Chan and Keung in relation to the lifts. It was suggested that Hon Hing’s engineer had obvious influence on the management committee. However, it became clear from the evidence that Chan was unable to tell what was allegedly conversed between Hon Hing’s engineer and the members of the management committee. The suggestion of Chan was in my judgment no more than conjecture.

124.  Importantly, the question of what had or had not happened before Jekco’s time aside, the dispute for the present purpose must be resolved on the basis of the state of affairs which Jekco knew or ought to know when and since it took over as the registered lift contractor of the Building in 2008. The EMSD indeed repeatedly emphasised the significance of the duty of a lift contractor taking over the maintenance of lifts from another contractor and the demarcation of the contractors’ liabilities in relation to the safe operation of the lifts undergoing transfer of maintenance. By its Circular Nos 7/98 (issued in April 1998), 9/2002 (issued in May 2002) and 8/2004 (issued in August 2004), the EMSD consistently reminded that upon the transfer, the registered lift contractor, which was taking over the maintenance of the lift, had to ensure that it had the necessary expertise, adequate manpower and resources for the provision of the maintenance service to ensure public safety. The contractor had to confirm in writing to the EMSD that adequate competent lift workers and registered engineer were employed to carry out periodic maintenance, periodic test and examination of the lift. The registered contractor’s staff should possess the necessary knowledge, expertise and skill to carry out the lift works, and would have no difficulty in obtaining spare parts and essential components for the repair and maintenance of the lift in safe working order. The registered contractor also had to be well aware of the required expertise, manpower and technical information for proper maintenance of the lifts. It had to carry out periodic test/examination for each lift to be taken over for maintenance, and to submit a test/examination report to the EMSD following the format in the Code for every lift within 2 weeks from the date of transfer of maintenance.

125.  Pursuant to the successive contracts entered into with Hon Hing on behalf of the Owners, Jekco also contractually undertook the duty to inspect and to report on the condition of the lifts at the commencement of each contract term. In view of the positive and independent duties on its part, Jekco’s reference to the relatively short time for taking over from Holake and the lack of what it preferred to be proper manner of handover would not be an answer. Nor would its blame on the failure of the Third Parties to inform it of the renovation works to the Lift in 1997 and 2002.

126.  Prof Leung’s opinion in this respect, which endorsed the stance of Jekco, must be viewed with scepticism in view of its independent duty as the succeeding lift contractor. Contrary to his opinion, it was, in my judgment, not a matter of whether he believed that a registered contractor would not have agreed to take over the maintenance of the Lift had it been informed of those prior renovation works. It was what a registered contractor was supposed to do, and would have done, in view of the state of the Lift as of the time when the contractor agreed to and did take over its maintenance from its predecessor. Inspection, examination and investigation of the state and condition of the lift on an “as is” basis were its independent duties in any given case.

127.  As the lift contractor, the initiative was on Jekco to ensure the safety of the lifts of the Building and to enable the Owners to comply with their duties under the law. As Ir Kong pointed out, it was for the contractor to seek information from the management company or the owners, including consulting the maintenance logbook. The contractor should know whether and, if yes, how much time needed to be sought for compliance. For instance, EMSD Circular No 8/2004 mentioned above provided that extension of time for submission of test report was possible. The fact was that Jekco did submit its first report in respect of the Lift on 26 March 2008. The reference to the short time window for handover from Holake, which Prof Leung endorsed in his opinion, in my judgment is immaterial and no excuse.

128.  Jekco certified that the Lift, in its state when it took over as the lift contractor of the Building, was safe. Prof Leung opined that that was reasonable when Jekco had no idea about the counterweight additions. However, it was according to Jekco that the state of the counterweight caused it concern in March 2010. Had there been cause for concern, the same state of the counterweight would have been patent to Jekco upon and since it had taken over in 2008. Notwithstanding that, Jekco concluded and thus certifying that the Lift was safe annually ever since until the accident. Such conclusion must also be scrutinized in view of the admitted discovery on the part of Jekco about the state of the traction shaft as well subsequently in late 2011.

129.  Jekco allegedly rested its concern upon enquiry with Hon Hing’s representatives about the state of the counterweight in March 2010. Putting aside why no concern or enquiry about the state of the counterweight was raised since January 2008, even the evidence of Chan in respect of the enquiry in March 2010 turned out to be doubtful.

130.  According to Chan, upon enquiry, Hon Hing confirmed that the state of the counterweight consisted of additions incidental to the renovation works to the Lift which had been approved by EMSD in accordance with the proper procedure. He personally made such enquiry with Leung of Man Shine. However, it became clear from the evidence, including that of Leung, that it could not be Leung as he had not commenced working for Hon Hing until August 2011. When confronted, Chan changed to refer to a Mr Yeung who, according to the evidence, could only be Mr Gary Yeung of Hon Hing. Yet even Yeung had not commenced working for Hon Hing until the end of October 2012. Eventually, Chan shifted into vagueness about such alleged oral confirmation by Hon Hing. That hardly helps in terms of reliability of his evidence and the substantiation of Hon Hing’s alleged representation in respect of the state of the counterweight.

131.  In any event, one queries whether such alleged enquiry and answer by mere say-so by the representative of Hon Hing, if ever happened, would have sufficed for the purpose of Jekco’s discharge of its duty. There is no evidence that Jekco sought to consult the maintenance logbook or record of approval documentation at the time. Indeed, there is no dispute that Jekco would have found that record of such works in the form of the maintenance logbook or EMSD record was lacking. However, Chan admitted that Jekco had its registered engineer. There is no evidence of report and consultation with its registered engineer about the discovery.

132.  On balance, it is not established that the Third Parties were in fact aware of the additions to the counterweight incidental to the renovation works to the Lift in 1997 or 2002. Nor is there basis for inferring that either of them ought to have known that. There is also no basis for finding that the Owners are to blame for failure to comply the statutory duty in respect of reporting the renovation works as major alterations.

133.  Further, as discussed, the really relevant question is whether any concern about safety arose out of the state of the counterweight as it was patent to Jekco. Whether or not Jekco should have known about the state of the counterweight since it had taken over as the lift contractor of the Lift in 2008, the fact was that it never actually formed the view that any safety concern arose, and hence its certification of its safety ever since.

134.  Even assuming that Jekco had had such safety concern but gathered from Hon Hing that the renovations to the Lift had been approved by the EMSD, the mere word of Hon Hing in answer would not have afforded Jekco with any basis for treating itself as discharged from its independent duty to properly investigate and to verify as reasonably expected of it as a registered lift contractor as well as under clauses 4.4 and 5 of the 2010 Contract, clause 4.12 of the 2012 Contract, the EMSD Circulars mentioned above as well as clauses 2.3 and 4.1 of the Code (2010). I prefer the expert evidence of Ir Kong to that of Prof Leung in this respect. If any safety concern should arise out of the state of the counterweight as found in March 2010 at the latest, it was the duty of Jekco to address that irrespective of whether what might have accounted for such a state was known.

Discovering further the state of the traction shaft

135.  If there was ever any concern about the state of the counterweight or the same somehow being put to a rest for the time being in March 2010, as Jekco alleges, the picture should become more complicated upon also discovering the state of the traction shaft in late 2011.

136.  By pleading, Jekco denied knowledge before the accident about the traction shaft of the Lift having been trimmed. The experts (including that for the plaintiff) in the Tri-P Report agreed that it was impossible for the maintenance contractor to discover that the shaft of the traction machine had been trimmed in the course of routine maintenance. However, the state of the traction shaft, be it trimming, alteration or modification, should be detectable when the part was actually disassembled under repair. Indeed, in the present case, such repair was called for to address the repeated oil leakage problem of the traction machine.

137.  The oil leakage started in 2011, the third occasion of that happened on 11 October 2011. Visual inspection of the traction shaft on the following day did not reveal any defect. On 13 October 2011, Hon Hing wrote to Jekco to complain about the Lift’s repeated oil leakage problem, and requested for a report on or before 18 October 2011. The report came on 17 October 2011 whereby Jekco categorized the oil leakage as a normal wear and tear problem, and explained the remedial steps taken to address it.

138.  On 18 October 2011, Jekco issued a quotation to Hon Hing for the replacement of the traction machine, saying that:

“但電梯牽引機因物料老化因素，有一定的使用壽命。其中4#電梯日前就因此出現減速箱滲油情況。所以敝公司建議更換4#電梯的牽引機”

Essentially, Jekco explained that due to ageing of its components, the traction machine had a certain lifespan. The oil leakage problem of the Lift was the result of that. Replacement of the traction machine of the Lift was therefore recommended.

139.  On 20 October 2011, Jekco further removed the shaft of the traction machine of the Lift for ultrasound test. The contractor informed Keung on the following day that the traction shaft was not a single piece, but had a sleeve inserted at the seat of the bearing. As mentioned, Keung had suspicion about the form and state of the shaft. Nevertheless, he and Jekco’s contractor resolved to use shielded arc welding to seal up the gap between the sleeve and the traction shaft with a view to containing the oil leakage.

140.  On 27 October 2011, Jekco issued another quotation to Hon Hing for the replacement of the traction machine of the Lift, setting out the same reason and recommendation as before. This was followed by Jekco’s report dated 15 November 2011 on the repair done.

141.  The oil leakage recurred in mid-December 2011, entailing the disassembly of the traction machine of the Lift again for examination by Jekco’s contractor. This time Jekco and its contractor resolved to cast a new sleeve in replacement of the existing sleeve with a view to sealing off the gap between the shaft and the sleeve. In other words, Jekco adopted the state of the traction shaft and repaired it on an “as is” basis. The last repair did manage to stop the oil leakage. However, the accident happened in less than a year later.

142.  Jekco’s pleaded denial of knowledge about the state of the traction shaft prior to the accident cannot be maintained as a matter of fact. However, it is submitted on behalf of Jekco that the Third Parties were also aware of the trimming of the traction shaft beforehand. The basis is that Ir Kong in his oral evidence agreed that such kind of alteration work to the traction machine should entail the suspension of the lift service, which the Third Parties should have known. I do not see the logic. That the work involving trimming of the traction shaft would entail the suspension of the lift service could not possibly afford the inference that suspension of the lift service had to do with such work. As counsel for the Third Parties put it, there could be many repair and maintenance reasons entailing the suspension.

143.  Further, the letters from Hon Hing concerning the condition of the Lift during late 2011, including its plea to the EMSD for assistance in view of the apparent repeated failure of Jekco to cope with the problem, tend to suggest that the Third Parties genuinely had no idea about what was wrong with the Lift or its traction machine at the time.

144.  Keung and, from Keung, Chan came to realise during the repair in October 2011 that the diameter of the traction shaft had been trimmed, and that it differed from the state of traction shaft so far encountered by them. Chan confirmed that in court. Notwithstanding the suspicion about the state of the traction shaft, Jekco did not investigate by obtaining the original geometry of the traction shaft from the manufacturer. In court, Chan explained that he held a different view of the matter from that of Keung. He also sought to explain the apparent lack of investigation by enquiry with his predecessors. He referred to his experience and belief that such enquiry, if made, would not be entertained by what he described as his company’s competitor in the business.

145.  Section 26 of LESO provides that:

“(2) Where, upon any examination under section 21 or 22 or upon any examination in accordance with an order under section 25, the registered lift engineer or registered escalator engineer, as the case may be, is not satisfied that the lift or escalator and all machinery and equipment connected therewith is in safe working order and where, upon any test under section 23 or 24 or upon any test in accordance with an order under section 25, the registered lift engineer or registered escalator engineer, as the case may be, is not satisfied that the safety equipment provided for the lift or escalator is in safe working order, he shall—

(a) if he is of opinion that any further use or operation of the lift or escalator would be, or would be likely to be, dangerous, forthwith report the fact that he is not so satisfied to the Director and to the owner of the lift or escalator; or

(b) if he is of opinion that no immediate danger will arise from the further use and operation of the lift or escalator, report the fact that he is not so satisfied to the owner of the lift or escalator, and where—

(i) within a period of 14 days from the date of such report, the lift or escalator and all machinery and equipment connected therewith or the safety equipment provided for the lift or escalator, or both, as the case may be, has been put in safe working order to his satisfaction, shall give his certificate in the manner provided by subsection (1)(a); or

(ii) upon the expiration of such period the lift or escalator and all machinery and equipment connected therewith or the safety equipment provided for the lift or escalator, or both, as the case may be, has or have not been put in safe working order to his satisfaction, shall forthwith report that he is not satisfied that the lift or escalator and all machinery and equipment connected therewith or the safety equipment provided for the lift or escalator, or both, as the case may be, is or are in safe working order to the Director.”

146.  The Third Parties relied on Jekco as the lift contractor to consider and advise whether and, if yes, what of the Lift might call for the attention of the registered engineer. It followed from its lack of pursuit in investigating the trimmed traction shaft that Jekco did not consider the need to alert the registered engineer to their discovery of the operation of the Lift with the state of its traction shaft. Had that been done, what section 26 of the LESO entails would have been triggered, and a proper assessment of the situation would have been carried out. As mentioned, Chan admitted in court that Jekco had registered lift engineer under its wing at the material times.

147.  More importantly, Jekco adopted its approach without regard to the state of the counterweight which it had also known since March 2010 at the latest, and which admittedly had potential bearing on the traction shaft of such a state in the daily operation of the Lift. When it is now contended that the load created by the state of the counterweight of the Lift was the culprit for the breakage of the traction shaft, what Jekco did or did not do upon also discovering the suspicious state of the traction shaft only invites scepticism.

148.  Jekco proceeded to repair by adopting the state of the traction shaft with the sleeve as discovered without consultation with the manufacturer. In court, Chan was asked but was not quite able to give a satisfactory explanation for adopting such course of action. First, that such course of action would be considered as more prudent than replacing the problematic yet significant part with the original new part sourced from the manufacturer does not sound convincing. Second, Chan explained that it would take time to obtain the supply of original part. However, the fact was that Jekco did not even consider that as an option and therefore never actually enquired with the manufacturer about that. Third, according to Lo’s EMSD statement in 2013 mentioned above, there was no problem of Chevalier in arranging supply of replacement parts for the lift of the kind in question. Last, and importantly, had such enquiry been made, chances are that the shaft with the sleeve was suspected to be not its original design could have been verified and rectified.

149.  Reflective of Jekco’s thinking at the material time, Chan in his evidence sought to explain that the Lift had been certified safe by the successive registered engineers to be safe in the years before Jekco took over as the lift contractor in 2008. When Jekco took over, the safety of the Lift was again certified by the registered engineer. Chan testified that in view of the fact that the Lift had been operating in such condition without accident for years, Jekco would hardly be expected to suggest otherwise to the Third Parties once it had taken over as the lift contractor. Prof Leung supported such a stance in view of the lack of crack on the traction shaft upon the ultrasound test. As mentioned, Ng and Ir Kong held a different view.

150.  I prefer Ir Kong’s view to that of Prof Leung in this respect. Lack of prior accident or surfacing of metal fatigue in the form of crack in the trimmed traction shaft up to the test in late 2011 was not indicative of whether and, if yes, when the shaft in such a state would be taking its toll after that moment. This was particularly so when the evidence of metal fatigue in the form of crack in the trimmed traction shaft would not be detectable unless the traction machine happened to be disassembled and the shaft submitted to a similar test. That was no different from leaving that to chance.

151.  Prof Leung did calculate the chance of failure of the traction shaft in its trimmed state. However, insofar as Jekco as the lift contractor was concerned, the appreciation of safety concern hardly had anything to do with the kind of calculations proposed by Prof Leung. As Prof Leung indeed opined, calculation of stress and stress intensity as well as whether the traction shaft had exceeded its stress endurance limit would be matters beyond the ability of a surveyor, and should be one for a scientist in mechanical engineering. In any event, despite the calculations proposed by Prof Leung and the view of his and Jekco, the shaft did break in about 10 months afterwards as a matter of fact. Whether and, if yes, what should and could have been done to ensure the safety of the Lift should depend on the state of knowledge about the circumstances and how those circumstances were reasonably appreciated by the responsible party(ies) at the material time. Reasonableness hardly depends on the calculations proposed by Prof Leung.

152.  If Jekco in its role as the registered lift contractor under its statutory, contractual and general common law duty mentioned above is allowed to rely on the certification of safety of the Lift by the past lift contractors and the lack of previous accident, one wonders why the Third Parties, as lay parties which contracted and put Jekco in its role as well as relied on it for the execution of the maintenance of the Lift in compliance with the statutory duty on their behalf, would have been in a less advantageous position to plead the same on the basis of the conclusion of the lift contractors. What basis Jekco now has for seeking to place the blame for the accident on the Third Parties, one may ask.

Jekco’s recommendations

153.  Jekco did take the initiative to recommend to the Third Parties for the replacement of the traction machine. Whilst that exceeded the scale of the necessary replacement recommended by Ir Kong, one may say that had the Third Parties resolved to adopt Jekco’s recommendation in time, the accident would have been prevented. However, before liability arises from the Third Parties’ failure to do so, one must look at the context in which they were advised to consider the recommendation.

154.  In Yau Po Shan v The Express Lift Co Ltd & Anor [2019] HKDC 1495, the plaintiff was injured in the lift when it suddenly plunged and jerked twice before stopping below the lobby floor. She sued both the lift contractor and the management company of the building. It was found that the accident was caused by the failure of the relay for drive motion signaling. The court found that the lift contractor was negligent in failing to inspect and to maintain the relay properly despite knowledge about the condition of the relay 20 months prior to the accident. The court found that the management company was not liable as the lift contractor had never suggested to it that it was unsafe and dangerous to allow the lift to operate without replacing the relay. The circumstances pointed out by the court were:

“130. One should, I think, first observe the followings about the contents of the Report:

(1) D1 [the lift contractor] had never suggested in it that the lifts of the Estate were unsafe or dangerous to be used or that they should be replaced at once without delay.

(2) The recommendations were put forward as renewal (更新) or improvement (改善) (the Lift has, after all, not been replaced for at least 18 years).

…

131. One year after the Report, the overall test status of the Lift, one further observes, was still marked “pass” in the Test Report. The items to be followed up did not include the recommendations in the Report. Hence, there seems to be no cause or urgency even by Mar 2011 to implement these recommendations at substantial costs. Even allowing for the happening of the 5 Incidents in Oct 2011, one wonders objectively whether reasonable time had expired by the Accident for D2 to follow them up with the IO.”

155.  In its recommendation and quotations for the replacement of the traction machine mentioned above, Jekco never actually alerted the Third Parties to any safety concern that could arise out of allowing the Lift to continue to operate on the traction shaft in its suspected non-original but trimmed state with the sleeve when the state of the counterweight, which had potential bearing on the operation of the shaft in such a state, was also known to Jekco. By failing to accept the recommendation in those terms, the Third Parties did not disregard any safety risk to which they were not alerted. The circumstances, in my judgment, do not enable Jekco to put the blame on the Third Parties for such failure.

156.  There is dispute between the parties as to whether Jekco, if it considered that it should be done, could have proceeded to replace the traction machine anyway. This depends on the terms of the contract between the parties, which is a matter of construction. Properly construed, clause 5.9 of the 2010 Contract provided that Jekco agreed to supply work and material for the replacement of machinery parts of the Lift occasioned by wear and tear and not by human act/damage. Similar provisions existed under clauses 5.5.6 and 5.5.7 of the subsequent 2012 Contract. Though the construction of the terms of the contract is strictly a matter for the court, Prof Leung stated a similar understanding of these terms of the contract in his written opinion. He took the view that the state of the traction shaft was the product of human act.

157.  However, Jekco denies any contractual obligation at all to replace for free the traction machine come what may, ie even in the event of normal wear and tear. In this respect, what Chan put forward in his evidence however was no more than his personal view of whether such obligation was reasonable with reference to what his company charged monthly fee. Clearly, commercial wisdom has no place in construing the terms of a concluded contract as a matter of fact. Nor has any view of the court as to whether and, if yes, what would have been reasonable for the contracting parties.

158.  That said, what Prof Leung qualified in his opinion in this respect mentioned above is not without basis as a matter of fact. What led the Third Parties to argue with reference to the contractual obligation of Jekco to proceed with the necessary repair and replacement instead of leaving it to the Third Parties to decide is Jekco’s own case that the problem that needed to be addressed at the material time was ordinary wear and tear of the traction machine. As such, the contractual provisions would have supported the Third Parties’ argument. However, the fact as found, which the Third Parties accept, was that the traction shaft had been improperly modified, and hence human act/damage for the purpose of the relevant contractual provisions. There is therefore no need to labour further on this aspect of the dispute between the parties. The Third Parties would have been responsible for paying for the repair.

159.  The Third Parties contend that had Jekco alerted them to the problem and advised them properly, the problem should have been addressed by replacement of the shaft and, pending that, suspension of the operation of the Lift. Such stance has the support of the opinion of Ir Kong. That in my view would also have aligned with what the governing statutes mentioned above and the common law duty on both sides would expect in the circumstances.

160.  However, the experts differ in their opinion as to whether the traction shaft could be replaced instead of the entire traction machine. Prof Leung approached this issue on the basis that the traction shaft was an integral part of the traction machine which could not be singled out for replacement. The proposition, it appears to me, was not adequately investigated when the traction machine was made of various components with various integral significance. One should note that in the Tri-P Report, Prof Leung actually joined the other experts in agreeing that the traction shaft should be replaced, albeit in the context of curbing the oil leakage problem.

161.  It should not have to be a matter of debate between the experts but a matter of factual investigation. As mentioned, Lo of Chevalier in his EMSD statement confirmed that his company as the Hong Kong agent of the manufacturer of the model of the Lift had by then no difficulty in sourcing and supply of the machinery parts from the manufacturer for the purpose of repair and maintenance for the Lift. There is no evidence of actual enquiry at any time since the accident about whether the original traction shaft could have been sourced for the purpose of repair. As to the actual repair, the incidental statutory requirements to ensure its propriety and safety would have set in.

162.  Ir Kong opined that the traction shaft should and could have been replaced. With the replacement of the bearing, the cost was estimated to be about HK$30,000 as opposed to over HK$100,000 for the entire traction machine. Further, replacement of the entire traction machine would have entailed more complexity and considerations as well as time, but that was not considered to be necessary in the circumstances of the present case. On balance, I prefer the opinion of Ir Kong to Prof Leung in this respect.

163.  All the circumstances considered, I do not find that the Third Parties should be to blame for apparently failing to adopt the recommendations of Jekco for the replacement of the traction machine. On the contrary, the Third Parties have cause for complaint against Jekco, which they relied on, for failing to properly and adequately advise what potential safety concern arising out of the state of the traction shaft and the counterweight, both of which were patent to Jekco since late 2011, as well as how to address such concern.

164.  Jekco asserts that the Third Parties were also advised to install rope grippers during a meeting at a restaurant during the Chinese New Year of 2012. According to Chan, rope grippers were recommended for the 2012 improvement works. Leung denied such advice. The improvement works which Jekco was contracted in 2012 to provide related to the 4 cargo lifts instead of the Lift. There is lack of contemporaneous evidence documenting such alleged advice as opposed to the recommendation and quotations for the replacement of the traction machine of the Lift discussed above.

The Guidelines

165.  The Guidelines made it clear that they aimed to help the “responsible persons” for lifts to implement enhancement and modernization solutions in the context of the LEO. As mentioned, the provisions under the LEO regulating the duties of the “responsible persons” as defined, ie the Third Parties included, had yet to come into effect as at the date of the accident. The recommendations of the Guidelines which the Third Parties are said to have failed to follow are also not particularized clearly, if at all, as a matter of pleading.

166.  In any event, the Guidelines repeated the duties of the “responsible persons” for lifts under the LEO to (i) ensure regular maintenance by a registered ift contractor; (ii) to proactively identify improvement needs for existing lifts through the process of regular maintenance; and (iii) if any of the improvement needs is identified, to implement modernisation works to enhance the safety, reliability and comfort of the existing lifts. On this basis, recommendations for the enhanced solutions were put forward. That said, the Guidelines also made clear that the “responsible persons” had full discretion as to whether or not to adopt the recommended enhanced solutions. Should they decide to do so, they were advised to consult their registered lift engineer for a review.

167.  By letter dated 15 November 2011, the EMSD copied to Jekco the Guidelines distributed to lift owners. The letter advised Jekco as the lift contractor to make reference to the Guidelines and encouraged the owners and property management to improve the safety performance of their lifts and to review the feasibility of modernising the existing lifts. The enhancement solutions proposed did not include the replacement of problematic or potentially problematic parts of the lifts but the installation of modern safety devices. Further, the letter from the EMSD to Jekco was dated the day when Jekco had already made its recommendation and issued its quotations for the replacement of the traction machine. In other words, none of those was done in the context of the Guidelines. This should also be apparent from the wordings of the recommendations and quotations issued to the Third Parties.

168.  Importantly, nothing in the Guidelines suggested departure from the situation that whilst the Third Parties were under their duties as the owners and property management in respect of the safety of the lifts, it remained for the lift contractor which they engaged to advise them on the implementation of the enhancement solutions. In other words, there is no basis for taking a different view of the matter as discussed above, namely that the Third Parties had contracted and delegated to reasonably competent registered lift contractors, including Jekco, to perform the duties in respect of the maintenance of the Lift to ensure its safety in compliance with the applicable statutes and guidelines on behalf of the Third Parties. The Third Parties did not possess the relevant technical knowledge and expertise, precisely for which they had to and did rely on the registered lift contractors for such compliance.

Conclusion

169.  All the circumstances considered, I do not find that as a matter between Jekco and the Third Parties, the latter are to blame and should be liable for contribution towards the former’s liability in respect of the damage to the plaintiff as a result of the accident.

170.  Thought may arise to the effect that Jekco somehow walked into a trap where the state of the Lift had latent safety issues attributable to its predecessor(s) as the registered lift contractor(s) of the Building. I think by now the counter-argument should be clear.

171.  First, the statutory and common law duty on the part of the lift contractor discussed above clearly arose on the part of the lift contractor on the basis of the state of the lift as of the time of takeover of the maintenance responsibilities. Such duty is independent from the contractor’s predecessors. In the absence of proof of knowledge about the state of the lift on the part of the owners or property management, which has been withheld from the lift contractor, the contractor would be expected to possess the necessary expertise and resources to satisfy itself whether or not the lift, as it then was, was safe. If not, it would be its duty to advise the owners and the property management.

172.  Second, it follows from the above that Jekco’s claim in the present action is peculiar. Whilst, as it is never denied, the Third Parties were under their non-delegable duty of care as the parties in occupation and control of the Lift to the plaintiff as its passenger, the plaintiff chose not to claim against them. Had she done so, one would have expected that the Third Parties would join Jekco as the third party for contribution and indemnity on the basis that the Third Parties had entrusted and delegated to it the execution in discharge of the duty to ensure the safety of the Lift. In the circumstances so far discussed, I am not surprised that the plaintiff decided not to direct her claim against the Third Parties.

173.  Third, now faced with the plaintiff’s claim, Jekco seeks indemnity or contribution in respect of the same damage from the Third Parties. This is the reverse of what one would have expected. The Third Parties contend that Jekco is effectively shifting the blame for what happened in its execution of the duty to ensure the safety of the Lift back to them. All the circumstances considered, I agree.

ENTITLEMENT OF JEKCO TO CLAIM UNDER THE CLCO

174.  The above conclusion very much disposes of Jekco’s claim in the third party action. That said, a couple of contentions in respect of the right of the parties to seek contribution or indemnity in respect of any damage caused to the plaintiff deserve some discussion.

The CLCO

175.  The Third Parties raise an argument in respect of the entitlement of Jekco to premise its claim on the CLCO. If accepted, such argument, it appears, could have entitled the Third Parties to mount a striking out, which has admittedly never been taken out.

176.  Section 3(1) and (4) CLCO states:-

“(1) Subject to the following provisions of this section, any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly with him or otherwise).

(4) A person who has made or agreed to make any payment in bona fide settlement or compromise of any claim made against him in respect of any damage (including a payment into court which has been accepted) shall be entitled to recover contribution in accordance with this section without regard to whether or not he himself is or ever was liable in respect of the damage, provided, however, that he would have been liable assuming that the factual basis of the claim against him could be established.”

177.  In issue is the proviso or assumption under section 3(4) for the purpose of founding the third party liability. In Li Shiu To v Cheung Pik Ng (No 2) [2018] 1 HKLRD 934, the court explained:

“26. In respect of the concept of a person being liable in respect of a certain damage suffered by another, s. 2(3) of the Ordinance provides that:“A person is liable in respect of any damage for the purposes of this Ordinance if the person who suffered it (or anyone representing his estate or dependants) is entitled to recover compensation from him in respect of that damage (whatever the legal basis of his liability, whether tort, breach of contract, breach of trust or otherwise).

…

31. In short, the function of the statutory assumption is to ensure that there is a reasonable cause of action by the plaintiff against the defendant such as to (1) make the defendant liable in law to the plaintiff in respect of the damage, and (2) enable the defendant to further make a claim for contribution in respect of the same damage against a third party despite the fact that there was a settlement between the defendant and the plaintiff.

32. At the end of s.3(4) of the [CLCO] is a proviso, ie ‘provided, however, that he would have been liable assuming that the factual basis of the claim against him could be established.’…This is, as was said by both the Law Reform Commission of Hong Kong and the UK Law Commission, to emphasise amongst others, the bona fide element of the settlement. An example was given to illustrate the purpose of the proviso:

“Thus if D1 settles with P in a situation where D1 was clearly not liable to P, even if P could establish the facts relied upon, D1 could not claim contribution from D2…”

33. On a proper interpretation of s.3(1) and (4), D1 must prove among other things, that TP is liable to P (in the sense that P is entitled to recover compensation from TP) and that such damage is the same damage for which D1 is allegedly liable to P. Section 3(1) is subject to the following provisions of s.3, including s.3(4) which requires the settlement to be bona fide.”

178.  Hence, the key in section 3(4) is that the claim for contribution or indemnity must be premised in respect of the damage on the basis of the facts asserted by the plaintiff to found his claim against the defendant. This explains why the court in Li Shiu To accepted the argument that the defendant does not need to prove in the third party action such facts which presumably overlap with those in the main action. In the case of settlement between the plaintiff and the defendant, such facts on which the cause of claim in respect of the damage in question are to be identified would depend on the circumstances. The court in Li Shiu To, endorsing the judgment of Dubai Aluminium Co Ltd v Salaam [2003] 2 AC 366, explained:

“36. …At [69] of the judgment, Lord Hobhouse had this to say:

[69] Section 1(1) of the 1978 Act requires the person claiming a contribution to prove that he was a ‘person liable in respect of’ the damage suffered by the injured party. But subsection (4) qualifies this where the person claiming the contribution has made a bona fide settlement or compromise of the claim against him, in which case all he need prove is that he would have been liable ‘assuming that the factual basis of the claim against him could be established’. This raises the question: how is the factual basis of the claim against him to be identified? The answer to this question must obviously depend upon the circumstances. The claim may have been settled or compromised without the commencement of legal proceedings or it may only be settled later after the exchange of pleadings or during the trial. Some proceedings may be governed by strict procedural rules; others may allow a party to inform the other of the factual basis of his claim with greater informality. Pleading may be dispensed with. In the Commercial Court factual allegations can be particularised informally in a number of ways.

[70] In the present case the factual allegations in the pleading were more than sufficient to lay the factual basis for a liability of the partnership under section 10 of the Partnership Act 1890 in the tort of deceit. So, once it is appreciated that it is a case of the vicarious liability of the partnership for the tort committed by one of the partners in the course of the partnership business no further problem arises under this head. But I would not wish it to be thought that material other than pleadings may never have to be looked at. The variety of circumstances to which I have already referred demonstrates this. Further, if the state of the pleadings is to be decisive, a defendant wishing to compromise a case may have to insist that the claimant first amend his pleading so as to make express the basis of claim which justifies the settlement, even though neither would be taken by surprise nor able later to resist appropriate amendments. The purpose of subsection (4) is to facilitate bona fide settlements without prejudicing the rights of the paying party to claim a contribution from another. Of course the factual basis for the claim has to be identified in order to enable the remainder of section 1 to be applied but it would be mistaken to introduce inappropriate formalities into the criterion required by the subsection.

Lord Hobhouse’s statement was the context of the liability of a defendant to the plaintiff in the main action, as opposed to the liability of the third party to the plaintiff in the contribution proceedings.

37. On a proper construction of the statutory provisions, I agree with [counsel for D1]. Their construction tallies with the legislative intent expressed in para.45 of the UK Law Commission Report, especially the first of the three points therein. Accordingly, D1 does not have to prove his own breach of duty because of the statutory assumption, but he has to prove other elements of the dishonest assistance claim against TP.”

179.  In Li Shiu To, the plaintiff commenced the main action against the 1^st defendant, as the executor, for failing to collect and distribute part of the deceased’s estate. The 1^st defendant joined the third party into the proceedings. The main action was then settled between the plaintiff and the 1^st defendant. Subsequent to the settlement, the 1^st defendant filed a statement of claim in the third party proceedings. Whilst maintaining his pleaded defence in the main action, which denied factual basis of the plaintiff’s case as well as any knowledge or conduct in breach of his duties, the 1^st defendant claimed against the third party for dishonest assistance. The problem of the 1^st defendant’s claim for contribution was pointed out by the court:

“38. As in all situations where assumptions are made, those assumptions can be displaced by evidence to the contrary. The court is not precluded from considering materials beyond pleadings in the main action: Dubai Aluminium, [70]. And, as in all cases, even those in which he relies on the statutory assumption, a party is bound by his own pleadings.

39. In the present case, the [third party statement of claim] was filed after the settlement….[The 1^st defendant]’s express denial (in the Main Action, the third party proceedings and his witness statements) that the 801 Shares fell within the Estate meant that there could not be a failure to collect them in. Hence it could not be said that [the 1^st defendant] had put himself in a position of conflict, thereby causing loss of the Estate’s property by reason of the 1989 Acts. In fact, as Mr Joffe stated in his oral closing submission, if [the 1^st defendant] had amended the [third-party statement of claim], [the 1^st defendant] would be contradicting his own witness statement.”

180.  In the present case, insofar as liability is concerned, Jekco denied by pleading the contentions of the plaintiff in respect of the cause of and liability for the accident, and contended that the Third Parties should be solely liable. Notwithstanding that, nothing prevented Jekco from settling with the plaintiff, which it did.

181.  However, when it comes to his entitlement under the CLCO to claim for contribution or indemnity against the Third Parties in respect of the same damage in case of settlement of the main action, Jekco would have been expected to claim against the Third Parties on the basis of the facts founding the claim and its liability in the main action, which are assumed to have been established. In Li Shiu To, the court referred to the UK Law Commission’s Law of Contract: Report on Contribution (Law Com No 79) (1977) and explained:

“51… As to liability, D1 would have to establish that D2 [the third party] was liable to P, and the case against D2 would presumably, be much the same whether it was advanced by P in the main proceedings or by D1 in his claim for contribution.”

182.  That is not strictly what Jekco premises for its third party claim. Jekco maintains its denial of the factual contentions of the plaintiff that founded her claim against it. This started with the denial that the cause of the accident was the trimmed state of the traction shaft and Jekco’s failure of its duty incidental to that. In other words, Jekco is denying the very factual premise giving rise to its liability to the plaintiff for asserting its entitlement to lodge the third party claim under the CLCO. Jekco maintained such stance in its factual and expert evidence at the trial of the third party action.

183.  In the circumstances, I can see the force of the Third Parties’ argument that if the claim against them for contribution or indemnity is premised on section 3(4) of the CLCO, then either that it is questionable whether the settlement of the main action may still be said to be bona fide or that Jekco’s case in the third party proceedings displaces the assumption which would have entitled it to lodge the third party claim for contribution or indemnity in respect of the same damage.

184.  The Third Parties also argue that the contribution sought by Jekco against them would not be just and equitable. It would appear that the basis of the argument does not differ materially from the circumstances of the case already discussed above. Contractually, the parties have also agreed on terms to regulate their rights in this respect. By clauses 4.12 and 5.12 of the 2012 Contract, the parties contractually agreed that Jekco would be fully responsible for any loss, damage or injury arising out of its negligence and mistake in work. Jekco further agreed to indemnify Hon Hing against direct loss or expenses incurred as a result of Jekco’s such negligence and mistake.

The Control of Exemption Clauses Ordinance, Cap 71 (“CECO”)

185.  Jekco relies on section 7(1) of the CECO and contends that the Third Parties may not exclude or restrict its liability for personal injuries resulting from negligence by the contractual provisions mentioned above. Section 7(1) provides:

“A person cannot by reference to any contract term or to a notice given to persons generally or to particular persons exclude or restrict his liability for death or personal liability resulting from negligence.”

186.  In my judgment, the reliance on the section is misplaced for the reason that there is simply no such issue of exclusion or limitation of liability being sought by the Third Parties.

187.  In Thompson v T Lohan (Plant Hire) Ltd [1987] 2 All ER 631, the court explained (at 638J-639A) the application of the equivalent UK provision (section 2(1) of the Unfair Contract Terms Act 1977), and had this to say:

“All that has happened is that [the defendant] and the third party have agreed between themselves who is to bear the consequences of [the defendant’s employee]’s negligent acts. I can see nothing in s 2(1) of the 1977 Act to prevent that. In my opinion, s 2(1) is concerned with protecting the victim of negligence, and of course those who claim under him. It is not concerned with arrangements made by the wrongdoer with other persons as to the sharing or bearing of the burden of compensating the victim. In such a case it seems to me there is no exclusion or restriction of the liability at all. The liability has been established by Hodgson J. It is not in dispute and is now unalterable. The circumstance that the defendants have between themselves chosen to bear the liability in a particular way does not affect that liability; it does not exclude it, and it does not restrict it. The liability to the plaintiff is the only relevant liability in the case as it seems to me, and that liability is still in existence and will continue until discharge by payment to the plaintiff.”

188.  In the present case, whilst the CECO precludes the Third Parties from excluding their liabilities for negligence towards the plaintiff (which, as discussed, was non-delegable), it does not preclude the Third Parties from contracting with the lift contractor for the latter’s indemnity of their liabilities.

189.  It follows that assuming that the Third Parties had been faced with a claim by a plaintiff for breach of their non-delegable duty, it would have been consistently the contractual right of the Third Parties to seek indemnity in respect of such damage against Jekco on the basis of the latter’s negligence pursuant to clause 4.9 of the 2008 Contract, clause 4.9 of the 2010 Contract as well as clauses 4.12 and 5.12 of the 2012 Contract.

ALTERNATIVE SCENARIO

190.  For the sake of completeness, in the event I am wrong above so that the Third Parties should nevertheless be liable, I am of the view that their fair share of responsibility should not exceed 20% of the liability to the plaintiff in respect of her damage.

THE COUNTERCLAIM

191.  It was Jekco which was in breach. The Third Parties counterclaim against Jekco for negligence and/or breach of the 2012 Contract in failing to repair or replace the traction shaft of the Lift and thus causing the accident and damage to the Lift. They claim that Jekco should be fully liable for the cost and expenses for the subsequent repair of the Lift pursuant to clauses 4.12 and 5.12 of the 2012 Contract.

192.  The Third Parties also claim against Jekco for contractual compensation for the cessation of service of the Lift at the daily rate of HK$1,000 during the period between the date of the accident, ie 9 November 2012, and the date when the EMSD certified the resumption of service of the Lift, ie 9 October 2014.

193.  Jekco contends that the Third Parties did not put forward such counterclaim herein in Jekco’s action DCCJ 744/2014 subsequent to the accident, which was settled. In any event, the cost of repair claimed is excessive and/or partly for improving and upgrading the Lift. Further, the period of suspension of the use of the Lift exceeds the usual time for repair as well as that claimed in DCCJ 744/2014.

DCCJ 744/2014

194.  In DCCJ 744/2014 commenced in February 2014, Jekco claimed against Hon Hing for the latter’s early termination of the 2012 Contract at the end of November 2013. It claims for accrued but outstanding service fees up to the termination as well as one month’s service fee in lieu of notice of termination. As to that, Hon Hing contended that such payments had in fact been made and received by Jekco, which was therefore not entitled to the claim the same.

195.  Jekco also claimed for outstanding cost of test done to lift no 8 and consolidation works done to the Lift at the instruction of Hon Hing subsequent to the accident. As to the former, Hon Hing denied liability on the basis of alleged promise by Jekco not to charge for the test if the same was rejected by the EMSD, which turned out to be the case. As to the latter, Hon Hing denied liability as a matter of contract.

196.  By way of counterclaim, Hon Hing claimed against Jekco in DCCJ 744/2014 for repayment of overpaid service charges in respect of the period of suspension of the Lift after the accident. Such claim was premised on the alleged implied term of the 2012 Contract.

197.  Subsequently, the proceedings in DCCJ 744/2014 was settled. Whilst there was a confidentiality agreement between the parties, the terms of the settlement were disclosed as obviously relevant for the purpose of the parties in the present action.

198.  The order by consent in August 2014 recorded that Hon Hing would pay a sum of HK$90,000 (inclusive of interest and costs) to Jekco, and the parties would discontinue their claim and the counterclaim respectively. Further the parties agreed to “waive any further rights to commence any further claims against each other in relation to and/or arising from the subject dispute of the present proceedings”.

199.  Jekco contends that Hon Hing did not put forward in its counterclaim in DCCJ 744/2014 the claim now set out in the Third Parties’ counterclaim in the present action. Jekco does not say how that should affect the Third Parties’ entitlement as a matter of law. The question, it seems to me, is whether or not the counterclaim in the present third party action amounts to further claim against Jekco in relation to and/or arising from the subject dispute of DCCJ 744/2014.

200.  Whilst it was premised on the contract between the parties, the subject dispute of DCCJ 744/2014 was Jekco’s entitlement to its contractual service fees and outstanding service charge upon early termination of the 2012 Contract as well as the related entitlement of Hon Hing to recover from Jekco contractual service fees paid during the period of suspension of the Lift after the accident. Whilst reference to the accident was pleaded by Hon Hing, no issue of loss and property damage consequential upon the accident was raised.

201.  The circumstances do not impress me that the Third Parties should be prevented by reason of the settlement of the subject dispute in DCCJ 744/2019 or some form of issue estoppel, which was not really advanced in Jekco’s contention, from advancing its counterclaim for consequential loss and damage for breach of contract and negligence causing the accident.

The repair cost

202.  Insofar as the claim is based on clauses 4.12 and 5.12 of the 2012 Contract is concerned, in view of the finding that the accident was attributable to the traction shaft having been improperly modified from its original state, which was human act or damage, Jekco was under no contractual obligation to repair for free as in the case of normal wear and tear. Counsel for the Third Parties accepted that during closing.

203.  The Third Parties produced the invoice from the subsequent contractor responsible for repair of both the Lift and lift no 8, evidencing their cost of replacement/improvement at the sum HK$1,035,261.60. On the basis that the two passenger lifts were of the same design and model, half of the cost is taken to be incurred for the Lift, ie HK$517,630.80. Of that, the Third Parties claim a sum of HK$244,750 for the following repair of the Lift:

(1)	The traction machine	HK$112,800
(2)	Counterweight installation	HK$10,000
(3)	Buffer	HK$12,000
(4)	2-in-1 safety edge	HK$3,800
(5)	CCTV system	HK$4,000
(6)	Lift cage and frame renovation	HK$102,150

204.  On the basis of the expert opinion of Ir Kong, replacement of the traction shaft, had it been done, would have cost about HK$30,000. The Third Parties should be entitled to claim only the extra cost of repair.

205.  Jekco argues that the repair cost was excessive. It does not appear to be the case if this is compared with the quotation of Jekco after the accident in 2013. Jekco argues that the repair involved improvement. I can see the possibility of that in respect of items (4) and (5) of the repair in view of lack of findings or evidence of such damage. As to (6), the finding was that the interior ceiling of the lift car dropped upon the accident.

206.  In the circumstances, I do not allow items (4) and (5) but would allow a lump sum of HK$20,000 for part of item (6). Hence the amount of HK$154,800 – 30,000 = HK$124,800.

Contractual penalty

207.  The Third Parties rely on clause 5.19 of the 2012 Contract for their claim for contractual penalty. The clause provided that:

“若因中標判商過失或失誤導致升降機服務嚴重延誤或停止，中標判商須承擔第3.4項「逾期完工罰款」之責任 (每天港幣1,000元正)。”

Essentially, in the event of serious delay or cessation of the lift service due to the mistake or negligence of the contractor, the contractor should be responsible for the penalty set out in clause 3.4.

208.  There seems to be no dispute that the reference to clause 3.4 in clause 5.19 was a typographical error as the provision fitting the description should be clause 3.5 instead, which read:

“逾期完工罰款：每天港幣$1,000 (只適用於改善工程)”

209.  The combined effect of clauses 5.19 and 3.5 was that Jekco agreed to abide by the contractual compensation obligation under clause 3.5 in the event of delay or cessation of service of the lifts due to its mistake or negligence. Clause 3.5 set out the calculation of the compensation at the daily rate of HK$1,000.

210.  Jekco points out that clause 3.5 made it literally clear that this applied in respect of improvement works only. Indeed, clause 3.5 formed part of the terms of the 2012 Contract concerning the improvement works to the 4 cargo lifts and not the passenger lifts. However, when it came to clause 5, which was the part concerning the maintenance of all the lifts of the Building, clause 5.19 expressly required Jekco to undertake similar obligation to compensate according to the calculation set out under clause 3.5. In other words, clause 5.19 governed the performance of the part of the 2012 Contract concerning maintenance of all the lifts by incorporating clause 3.5, and thus making it applicable for such purpose.

211.  The dispute in respect of the quantum of contractual compensation for cessation of use of the Lift lies in the period of cessation. The Third Parties say that was from the date of the accident, ie 9 November 2012, to the certified resumption of the operation of the Lift on 9 October 2014. Jekco says what Hon Hing alleged in DCCJ 744/2014 was a much shorter period.

212.  In DCCJ 744/2014, what Hon Hing claimed by way of counterclaim was repayment of overpaid service charges to Jekco in respect of the period of suspension of the Lift. The period covered the date of the accident up to 28 November 2013. However, that was the date referable to the premature termination of the 2012 Contract. It was on this basis that Hon Hing counterclaim for overpaid service charge under the 2012 Contract up to its termination. In other words, that was not referable to, or excluded, the suspension of the operation of the Lift beyond that as a matter of fact. Nor was that referable to the contractual damage provision.

213.  Insofar as suspension of service of the Lift is concerned, any perceived reasonable repair period is not determinative as resumption of service would have to be subject to the EMSD approval. Indeed, the EMSD issued Form LE8 certifying the resumption of the service of the Lift only on 9 October 2014. There is no contrary evidence. Therefore, the contractual compensation would have to be assessed at the daily rate up to that date.

214.  Other than the above, there is no contention in respect of the enforceability of the contractual provision on the basis of genuine pre-estimation of damage or penalty. Nor is there contention that credit should be given between the claim for repair cost and the agreed compensation for suspension of service of the Lift.

Conclusion

215.  The Third Parties succeed in proving their counterclaim. That would be a sum of HK$124,800 + 700,000 = HK$824,800.

ORDER

216.  The claim by Jekco against the Third Parties is dismissed.

217.  Judgment is entered on the counterclaim in the total sum of HK$824,800 with interest at the judgment rate from the date of the counterclaim (28 February 2018) until payment.

218.  Following this event, I make a nisi order that Jekco shall pay the Third Parties their costs of the third party action, including any costs reserved, to be taxed if not agreed with, for the avoidance of doubt but with no disrespect, certificate for one counsel. In the absence of application in 14 days to vary, the nisi costs order shall become absolute without further order.