KHAN UMAR HAYAT v. KWOK CHUN KAM AND ANOTHER

DCEC210/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES' COMPENSATION CASE NO. 210 OF 2008

________________________

BETWEEN

________________________

________________________

JUDGMENT

________________________

1.  The Applicant claimed against the two Respondents under sections 9 and 10 of the Employees’ Compensation Ordinance (“the Ordinance”) in respect of injuries sustained at an accident at the Hoi Fai Container Depot on 20 December 2006.

2.  The Applicant Mr. Khan Umar Hayat (“Khan”) claimed he was employed by the 1^st Respondent Kwok Chun Kam (“Kwok”) who was a sub-contractor of the 2^nd Respondent, Eternity Logistics Ltd (“Eternity”).  The Applicant claimed alternatively that he was employed by the 2^nd Respondent as it is Kwok’s case that he and the Applicant were both Eternity’s employees.  Eternity, however, claimed it had sub-contracted the work to Kwok.  Eternity denied it was the employer of the Applicant or Kwok.

Liability

The Applicant’s Case

3.  Mr Khan was a neighbour of Kwok whom he had known socially for sometime.  On 19 December 2006, Kwok called him and asked him to take up a job loading and unloading goods into containers.  He was told to bring a friend along to help with the work.  On the morning of 20 December 2006, Kwok met up with Khan and his cousin Mr. Aslam Khan (“Aslam”), together they went to the Hoi Fai Container Yard at Ping Har Road, Lau Fau Shan in the New Territories (“Hoi Fai”).  At Hoi Fai, they met Jacky Yan Wai Shing (“Jacky”), the 2^nd Respondent’s director and shareholder, Jacky took them to area B at the back of the yard in his private car.  He showed them the containers and told Kwok what needed to be done.  Kwok told Khan and Aslam to change into their work clothes and start work.  They were told to load computer monitors into containers.  Khan admitted the three of them worked together with Kwok driving the forklift truck moving pallets loaded with monitors into the containers.  He and Aslam would load the pallets with monitors and deposit the monitors into the containers.

4.  At about 1 p.m. that day, Kwok told Khan to go with him to look for pallets. After he got into the forklift truck, Kwok drove it out of area B where they were working.  When they got close to the entrance of the yard, the forklift truck accidentally collided with a lorry.  Khan’s right hand was injured as a result of the collision.

The Injuries

5.  Medical reports on Khan confirmed he sustained an open fracture to his right forearm ulnar and radius bones.  He received emergency treatments for his open fractures on 20 December 2006, wound debridement and plating of his radius and ulnar bones was performed.  He was discharged from the hospital on 31 December 2006 with instructions to attend orthopaedic follow up clinics, nursing clinics and physiotherapy.

6.  He received a second surgical procedure on 19 July 2007 to release the tendon adhesions and tendon transfers to augment his finger and little finger extension.  He received bone grafting during the procedure.  At the follow up clinic on 21 April 2008, doctors found he had reduced grip strength of his right hand with pain over the forearm.  He was recommended to take up sedentary work.

The 1^st Respondent’s Case

7.  It is Kwok’s case that he and Khan together with Aslam were all 2^nd Respondent’s employees at the time of the accident.  He was paid according to the number of containers completed by he and his team.

8.  He claimed he had been working at Hoi Fai for over one year before Khan’s accident on 20 December 2006.  On 19 December 2006, Jacky called him up and asked him to bring 2 or 3 men with him the next day to work at the yard.  Kwok claimed he had always worked alone whenever work was available at Hoi Fai, this was the first occasion he was told to bring a few workers to work at the yard.  He denied he was a sub-contractor on this or previous occasions.

9.  Kwok further claimed he had driven the forklift at this container yard before at previous occasions he worked there.  He claimed he was never told he needed a licence to drive the forklift at the yard.  Although he had met Mr. Lee before at the yard, he claimed he was never asked to approach Mr. Lee to enlist his help to drive the forklift.  He denied there was a restriction to the use of the forklift trucks at the yard.

10.  He further denied he was Khan’s employer.  He claimed the day of the accident was the first time he had worked for the 2^nd Respondent even though he knew Jacky well, having seen him many times at the yard.  His pay was based on the number of containers he loaded for the 2^nd Respondent.  Jacky had offered $1,600 per container, but he had asked for $2,000.  He said he would split the payment with Khan and Aslam.

11.  On the day of the accident, Kwok claimed he needed a few more pallets to load computer monitors onto the containers.  He therefore asked Khan to go with him to look for pallets at the yard because he needed help to pick up the pallets and load them onto the forklift truck.  He lost his way and had gone to the entrance of the container yard entrance.  At the entrance, he collided with a lorry resulting in the fracture to Khan’s right forearm.

12.  Kwok denied the 2^nd Respondent’s allegation that he was on his way to lunch with Khan at the canteen at the entrance to the yard in the forklift.

The 2^nd Respondent’s Case

13.  Jacky Yan Wai Shing, a shareholder and director of the 2^nd Respondent, gave evidence at the trial.  He denied Eternity was Khan or Kwok’s employer. He claimed Kwok was a sub-contractor for sorting and loading computer monitors into containers for forward dispatch to China on instruction of his client.

14.  He said he did not bother with how many men and whom Kwok hired to do the work on 20 December 2006.  It is up to Kwok to arrange and perform the work at $2,000 per container.  He further claimed Mr. Lee Chun Chuen, a licensed forklift truck driver, was at the yard to assist with the work at the yard.  Eternity had rented the whole yard and three forklift trucks for customers’ hire at a charge of $300 per forklift truck per day and the driver Mr. Lee’s daily wage was $550.

15.  He claimed he did enquire if Kwok would hire the services of Mr. Lee after he took Kwok and his two workers to area B and told Kwok what needed to be done.  But Kwok had turned down the offer of Mr. Lee’s service.

16.  He claimed Kwok was illegally driving the forklift truck without a licence when he carried Khan to the entrance to the container yard in the forklift, he suspected they were going to have lunch at the canteen located by the entrance.

The Issues

17.   A.    Was the Applicant injured in the course of employment?

B.    Was the Applicant an employee of Kwok (the 1st Respondent) or Eternity (the 2nd Respondent)?

A. Was the Applicant injured in the course of employment?

18.  The 2^nd Respondent alleged the Applicant was on the way to lunch at the canteen when he was injured.  This was denied by both Khan and Kwok.  Both of them claimed they were looking for pallets for loading computer monitors into the container.

19.  Both Khan and Kwok were extensively cross-examinated on the reason why they were found close to the entrance of the container yard where the accident took place.  Kwok claimed he lost his way and had driven the forklift truck close to the entrance.  Khan said he was told to go with Kwok to look for pallets.  He too denied he was going to lunch at the canteen for he had brought his own lunch to work.  Being of the Muslim faith, he said he would not eat at local restaurants.

20.  The 2^nd Respondent’s suggestion that Kwok and Khan were not in the course of employment when he was injured but on their way to lunch was a speculation based on the proximity of the location of the canteen to the site of the accident.  The evidence of Khan and Kwok, in spite of vigorous cross-examination, was not shaken.  On that basis and on the basis that Khan is of the Muslim faith, he had brought his own lunch and would not dine at the container yard canteen, I accept it is unlikely that Kwok and Khan were on their way to lunch at the canteen at the time of the accident.

21.  Counsel for the Applicant, Miss Pinto, relied on a number of English authorities on the issue of “the taking of meals” by an employee at the work premises.  In the English Court of Appeal case of Blovelt v Sawyer [1904] 1 K.B. 271, Collins M.R. held at p. 273:

“on the evidence as it stands on the judge’s notes I should have felt no difficulty, because it would appear prima facie to indicate that the man was in his master’s employment during the whole of each day, from the time at which he went to his work to the time when he came away, and equally during the dinner hour, if he stayed, as during any other part of the time. He would be there on the contract with his master during all those hours, either directly in order to do that for which he was employed or for some purpose ancillary thereto.”

22.  While Cozens-Hardy L.J. held at p. 275-6 of the same case:

“In my view it can make no difference if the fact is that by the terms of the particular engagement the workman was to have the right, if so minded, to get his dinner on the employer’s premises.”

23.  In the case of Armstrong Whitworth & Co. v Redford Lord Parmoor held at p.778:

“The meaning of the words “in the course of employment” has been determined in this House in the case of Davidson v. M’Robb “’in the course of employment’ does not mean during the currency of the engagement, but means in the course of the work which the workman is employed to do and what is incident to it.” I think that a mid-day meal may be incidental to an employment such as that of the respondent, which commenced at six in the morning, and that the taking of such a meal did not as a matter of law in itself, and apart from special circumstances, create an interruption in the course of her employment. There are no special circumstances in the present case such as for instance arise when an employee is away from his work not in the course of employment, but for his own pleasure or business.

In the case of Davidson v M’Robb Lord Dunedin said, referring to course of employment: “It connotes, to my mind, the idea that the workman or servants is doing something which is part of his service to his employer or master.  No doubt it need not be actual work, but it must, I think, be work, or the natural incidents connected with the class of work, e.g. in the workman’s case the taking of meals during the hours of labour.”

24.  Consequently, even if Khan had gone with Kwok to lunch at the canteen at 1 p.m., he would still be regarded to be in the course of employment based on the authorities referred to above.  Khan was riding in the forklift driven by Kwok, he was merely following the instructions of Kwok.

25.  Even if Kwok was not licensed to drive the forklift, Khan was instructed to assist Kwok to pick up a number of pallets which Kwok needed to transfer back to area B where they were working.

26.  On that basis, Khan must be in the course of employment when he was injured for he was told to go with Kwok looking for pallets on Kwok’s instructions.  It does not matter whether Kwok was Khan’s employer or supervisor, Khan was only following instructions.  Lord Cozens-Hardy M.R. in the English case of Risdale v Owners of SS Kilmarnock [1914] C.A. 508 held:

“It would be dangerous in the extreme to allow it to get abroad that an employee is not at liberty to take, nay, is not bound to take, orders from his superior when, as far as he knows, there have been no directions given by the employer to qualify the authority of the superior…..”

The use of the forklift

27.  As to whether Kwok was permitted to use the forklift by the 2^nd Respondent, Kwok claimed he had in the past been using the forklift many times while working in the yard.  He claimed the time used for the loading of goods would be shortened by 1-2 hours a day if assisted by the forklift.  There were 3 forklift trucks at the yard, each of them had the key in the key hole.  According to Kwok, he understood he could use the forklift trucks and had been seen by Jacky on many previous occasions using the forklift without payment.

28.  I accept Kwok’s evidence on the use of the forklift trucks on previous occasions and on the day of the accident.  The evidence of both Khan and Kwok was Mr. Lee, the licensed forklift driver, was not at the yard early that morning when they reported for duty.  In fact, Khan said he did not see Mr. Lee at the yard on the day of the accident.

29.  According to Jacky Yan, Mr. Lee was at the yard early that morning, he had asked Kwok if he required Mr. Lee to drive the forklift for him, Kwok had turned it down. Mr. Lee then went to work at another part of the container yard.

30.  I find it incredible that the 2^nd Respondent should expect its sub-contractor to pay $300 daily hire charge for the forklift and a further charge of $550 to hire the services of Mr. Lee, when Kwok was only paid $2,000 per container which takes one day to load.  After deducting $850 for the use of the forklift and driver, Kwok is left with $1,150 to share between himself, Khan and Aslam which meant each would only get $383.  This is much less than the $500 daily wage Khan was promised.  It is, therefore, logical to conclude that Kwok would not have agreed to hire Mr. Lee’s service and would not be expected to pay any hiring charge for the forklift.  He would have the free use of the tools provided by his employer, Eternity.

B. Was the Applicant an employee of Kwok or the 2^nd Respondent?

31.  Kwok and Khan’s evidence at the trial was quite clear, they were employed by the 2^nd Respondent.  Khan said Kwok told him after the accident that Jacky was his boss.

32.  It is not disputed that Jacky had driven all three of them to area B located at the back of the container yard in his car.  Jacky also admitted he had originally expected Kwok and his team to work on Golden Logistics’ containers, but when these were delayed, Jacky sent Kwok and his team to work on a Mr. Liu’s container instead upon their arrival on 20 December 2006.

33.  From the evidence adduced, I am satisfied that both Khan and Kwok were employees of the 2^nd Respondent.  Jacky had told Kwok to bring 2 to 3 workers with him on 20 December 2006.  Upon their arrival at the yard, Jacky instructed them to do a particular job and not the one he had intended them to work on the day before.  Jacky gave instructions to Kwok on the work to be done, drove them to the work area and supplied the forklift truck and pallets for the work.

34.  I accept Kwok’s evidence that he was only a casual worker at the container yard himself, that he had never sub-contracted any work at the yard.  This is known to Jacky, who had merely told him to find 2-3 workers to do the job.  Kwok, like a ganger, got together Khan and Aslam to work for the 2^nd Respondent.  Therefore the background information indicated both he and Khan were the 2^nd Respondent’s employees. 

Quantum

35.  The MAB under the Certificate of Review of Assessment of 5 October 2009 assessed Khan to have suffered a 7% loss of earning capacity permanently caused by the injury.  The sick leave period allowed was 10.75 months from 20 December 2006 to 14 November 2007.  These were in accordance with the Hospital Authority’s record under the sick leave certificates issued by doctors who followed up Khan’s medical conditions.

36.  Professor Kumta considered a period of sick leave of 16 months and loss of earning capacity between 6-8% to be reasonable while Dr. Chan considered 12 months sick leave and 6% loss of earning capacity to be reasonable.

37.  After considering all the evidence, I allow a sick leave period of 12 months and the permanent loss of earning capacity at 7%.  The Applicant’s daily wage of $500 and monthly wage of $10,500 is also accepted.

S. 9 Compensation for loss of earning capacity

38.  $(500 x 21 x 96 x 7%) = $70,560.

S. 10 Compensation for sick leave

39.  $500 x 21 x 12 x 4/5 = $100,800.

S. 10A Compensation

40.  There is no claim under medical expenses.

Summary of Compensation

Interests

42.  Interests from date of accident to date of judgment at 2% per annum, thereafter at judgment rate.

Costs

43.  Costs to the Applicant to be taxed if not agreed to be borne by the 2^nd Respondent with certificate for counsel.  Applicant’s own costs to be taxed in accordance with Legal Aid Regulations.