CHIU MO YUEN v. JAMES CATERING EQUIPMENT LTD. AND OTHERS

HCPI 179/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 179 OF 1998

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J U D G M E N T

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1. By Writ of Summons dated 23 February 1998 as amended on 13 August of that year, the Plaintiff, a man who was born in 1941 and who is now aged 58, claims damages against all 3 Defendants arising out of an accident at work which occurred on 19 August 1995 when he was aged 54.

2. The Plaintiff's claim arises in both contract and tort based, as it is, upon allegations of breach of duty of care under Section 3 of the Occupiers Liability Ordinance; negligence; and breach of contract of employment.

3. In his Amended Statement of Claim, the Plaintiff alleges that on 19 August 1995, he was instructed over the telephone by a Mr Man Yuen Sing, James (who was the principal shareholder and a director of the 1st, 2nd and 3rd Defendants) to turn on a water supply at a tap situated in a cockloft at premises occupied by the Defendants or one or more of them. A staircase which had formerly given access to the cockloft had been removed in partition work carried out upon Mr Man's instructions.

4. The Plaintiff who, for many years, had been an employee of the Defendants, or one or more of them, and who took his instructions from Mr Man, gained access to the cockloft by means of an unsecured ladder placed upon a table. Having turned on the water supply, the Plaintiff (who is right handed) then attempted to return to the ground floor by means of the ladder; as he did so the ladder slipped from under him and he fell, suffering a fracture of his left distal radius and a laceration on his left palm.

THE HISTORY OF THE PROCEEDINGS

5. The Writ of Summons dated 23 February 1998 was issued against the 1st Defendant only. Interlocutory judgment was entered against that company on 29 April 1998 by default of Notice of Intention to defend. By order dated 23 June 1998, the 2nd and 3rd Defendants were joined as Defendants. On 9 October 1998, a defence was filed by the 2nd and 3rd Defendants who were, at that time, represented by Solicitors.Inter alia in that defence, the 2nd and 3rd Defendants denied that they were the employers of the Plaintiff and denied that the Plaintiff was injured in the course of his employment. The defence asserted that the 1st Defendant was the employer of the Plaintiff and that the Plaintiff was, in effect, the author of his own misfortune. The 2nd and 3rd Defendants alleged that the accident was caused or contributed to by the negligence of the Plaintiff.

6. By an order dated 19 May 1999, the 2nd Defendant was made the subject of a winding up order. As soon as this became known to the Plaintiff's Solicitors, an order was sought and granted on 17 November 1999 for the continuance of the action against the 2nd Defendant.

7. At the commencement of the trial before me, Mr Man himself appeared on behalf of the 1st and the 3rd Defendants. He was not legally represented but referred me to an order dated 27 April 1999 made by Master Jones which granted him leave to represent the 3 Defendant companies in this action. The Receiver did not appear on behalf of the 2nd Defendant in liquidation.

8. On the first day of the trial, Mr Man sought an adjournment to enable him, firstly to apply to set aside the interlocutory judgment dated 29 April 1998 and, secondly to seek medical evidence concerning the Plaintiff's alleged injuries. I refused this application.

9. On the second day of the trial, Mr Man sought to amend the defence of the 2nd and 3rd Defendants with the effect that the 1st Defendant would be joined in that defence and, in essence, to state that neither the 1st nor the 3rd Defendants were the employers of the Plaintiff at the material time, but that the 2nd Defendant (now in liquidation) was his employer. I refused that application.

THE EVIDENCE

10. The Plaintiff gave evidence himself and called two orthopaedic specialists, Dr Chow and Dr Tsoi.

11. For the defence, Mr Man himself gave evidence.

12. During the course of the trial I was referred, inter alia, to various records of the Companies Registry relative to the 3 Defendant companies and Mr Man's interest in them; numerous salary receipts apparently issued by various of the Defendants; the Plaintiff's tax return; a Notice by Employer signed by Mr Man and purportedly issued by the 1st Defendant under the Employees' Compensation Ordinance; and a 'settlement agreement between the employer and the employee' made under that same Ordinance, whereby Mr Man on behalf of the 1st Defendant acknowledged that that company was the employer of the Plaintiff; that the Plaintiff had suffered injury during the course of that employment; and that the Plaintiff agreed compensation in the sum of $107,640.00.

THE MEDICAL EVIDENCE

13. This evidence which was not, and in reality could not, be seriously challenged was as follows: -

"The Plaintiff was admitted to Tuen Mun hospital on 19 August 1995 with a fracture of his left side distal radius and with a laceration to his left palm. As emergency operation under general anaesthetic was carried out that same day for fracture fixation and wound suturing. The Plaintiff was discharged on 21 August and he was readmitted for removal of the external fixator on 4 October 1995. The fracture healed uneventfully but the Plaintiff complained of persistent pain over his wrist. A medical assessment board granted the Plaintiff 10% permanent disability on 16 October 1996."

14. Under cross-examination, Dr Chow confirmed that the Plaintiff's injuries were consistent with him having fallen from the ladder from a height of about 8 feet but, he added, that this type of injury could have occurred in any fall to a patient's left side and not necessarily from a height.

15. The essence of Dr Tsoi's evidence was as follows: -

16. He saw the Plaintiff on 29 December 1997 when he was still in the same occupation as he had been in prior to the accident but that he was unable to perform heavy duty work. Dr Tsoi gave details of the operation carried out on the Plaintiff after the accident, from the available medical notes. He said that a graft of bone has been taken from the Plaintiff's hip, or 'iliac crest', and had been used to fill the gap caused by the fracture.

17. Dr Tsoi said that the Plaintiff suffered in 1997 - and now - from left wrist pain (especially upon a change of the weather); weakness in the left wrist making it impossible for him to lift heavy objects and stiffness in that wrist. The doctor specifically found a mild degree of radial deformity of the left wrist; slight wasting of the left forearm muscles and distinct limitation in the range of motion of the Plaintiff's palmer flexion and his ulnar deviation. In addition, he found weakened dorsiflexion and radial deviation and he said that radiological examination revealed that the fracture of the distal radius had healed with deformity and the fracture of the left radius had healed with slight shortening resulting in relative ulnar lengthening.

18. Dr Tsoi concluded, in chief, by saying that the Plaintiff's residual stiffness, pain and secondary weakness may last for many years, and that his complaints are genuine and relate directly to the accident of the 19 August 1995. He recommended that the Plaintiff should not perform jobs that require heavy weight lifting with his left hand and that jobs which involve repetitive left wrist motion are unsuitable for him.

19. The doctor assessed that the Plaintiff had lost 10% of his earning capacity and he said that because of the Plaintiff's deformed bone in his wrist, he would suffer permanent pain.

20. In cross-examination, Dr Tsoi demonstrated how, in his view, the Plaintiff's injuries were consistent with his account of how the accident occurred, and he explained that in a fall it was a natural reflex action to use ones hand to break that fall causing precisely the type of injury suffered by the Plaintiff.

THE PLAINTIFF'S EVIDENCE

21. In the course of his evidence the Plaintiff told me that on 19 August 1995, in the morning, he was working as usual for his "boss" Mr Man. Whilst doing so, a Mr Yuen from nearby premises approached the Plaintiff and asked him if he would go into the cockloft at his employers premises and turn on the water supply which also served Mr Yuen's premises and which had previously been turned off by some plumbers.

22. At first the Plaintiff refused to do this because he did not regard it as his job, but after Mr Yuen had contacted Mr Man by telephone and then handed that phone to the Plaintiff Mr Man instructed him to do what Mr Yuen requested.

23. The Plaintiff said that since his employer had removed the staircase to the cockloft during previous partition work the only access to it was by ladder. There was a 14 foot ladder which was sometimes used to gain access but on the morning of 19 August that ladder was lying at the side of the building covered in various sizes of heavy plumbers' pipes. There was however another, shorter, ladder of about 8 or 9 feet in length which was already in position leading up to a hole into the cockloft. That ladder was not standing on the ground but on a metal table. The Plaintiff said that it had been in that position for about 12 days and he elected to use it to gain access to the cockloft because he was being pressed urgently by both Mr Yuen and Mr Man to turn the water on.

24. He got into the cockloft apparently without difficulty and having turned the water on he returned to the top of the ladder (which was constructed of steel conduit pipes) and having grasped the top right hand side of it with his right hand and having put one of his feet onto the top rung he then moved to get hold of the top left hand side of the ladder and to place his other foot onto it, the ladder slipped away from beneath him and he felt down towards his left hand side. The Plaintiff also told me that he was endeavouring to come down the ladder, as it were, with his back facing the ladder rather than his front.

25. After falling about 8 feet the Plaintiff said that he felt great pain in his left wrist and after he had managed to close the metal door to the premises a lady neighbour summonsed a taxi and he was taken to hospital.

26. The Plaintiff confirmed that the ladder which he had used had been secured neither to the entry to the cockloft or to the table on which it was resting, and that nothing had been fitted to the base of the ladder to prevent it from slipping or sliding on the metal table. He said that on the day of the accident he was the only employee in the premises and there was no one else who could steady or "foot" the ladder for him.

27. When he was asked who it was who employed him, the Plaintiff said it was Mr Man for whom he had worked for many years and from whom he took his instructions. He said that so far as he knew Mr Man was in charge of the 3 defendant companies and that he did work for each of those companies as required by Mr Man.

28. Following the accident the Plaintiff told me that he was on sick leave for about 10 months and that he returned to work for Mr Man in June 1996 where he did much the same work as he had done prior to the accident, but that he could not manage the heavy part of such work. He said that the type of work required of him was digging up floors; putting up brick walls; erecting partitions; painting and (as he put it) "all sorts".

29. The Plaintiff went on to tell me that he continued to work for Mr Man until July 1998 when it became plain to him that he was no longer required. He referred to some acrimonious correspondence between himself and Mr Man; to his receipt of warning letters and to the fact that his wages were being reduced. Upon legal advice the Plaintiff considered that he had been constructively dismissed and he started proceedings with the Labour Tribunal.

30. The Plaintiff then told me that after he stopped working for Mr Man he had found it very difficult to find other employment because of his disability and the requirements of such employment. He said he was not on public assistance but was living on his savings combined with the income of his wife and his daughters. He said that he had been registered with the Labour Department but had not been offered any interviews leading to employment because he does not have a watchman's permit.

31. Finally, in chief, the Plaintiff said that had it not been for the accident he would have expected to retire at age 65.

32. Cross-examined by Mr Man for over four hours, the Plaintiff was first asked how long he had been working for "our companies". "More than 14 years" replied the Plaintiff. He was then asked about the nature of his work over that period and it became plain to me from his answers that in his view he was in fact employed by Mr Man as a general labourer and handyman. For example, when asked what work he did in 1993 and 1994, the Plaintiff replied "whatever I was told to do".

33. As to the cockloft, the Plaintiff agreed that he had been into it prior to the accident and that when he had, he had used both the long and the short ladders. He said that he never went into the cockloft unnecessarily and that he had never used the short ladder on the metal table unless there were other people present.

34. When Mr Man suggested that it was very dangerous to come down the shorter ladder with his back towards it the Plaintiff replied that he did not think of that. When Mr Man suggested to him that it was very dangerous to use the ladder placed on a table and that he should have known that, the Plaintiff replied: -

"You ordered me to do that, you are the boss, you left no staircase on that side of the shop [to give access to the cockloft]."

35. When Mr Man suggested that after the accident the Plaintiff's working capacity had not been impaired the Plaintiff replied: -

"Of course it had. When I returned to work I told you of my injury and that I could not do heavy work, you told me to do it slowly."

36. To Mr Man's suggestion that he carried out the same jobs as before the accident the Plaintiff replied: -

"No, I didn't and you reduced my salary and complained of my performance."

37. Mr Man then suggested to the Plaintiff that he had claimed to have had a number of industrial accidents whilst in his employ and that on each occasion they were false claims. The Plaintiff agreed that he had had a few accidents over the years but he was outraged by the suggestion that he had, in effect, fabricated his injuries or that they were in some way self-imposed. Inter alia he said that in one case he had injured his eyes because Mr Man had failed to provide him with goggles, and on another when he was caught in drying cement it was Mr Man's fault for providing a wholly inefficient system of work.

38. As to the accident giving rise to the present claim Mr Man suggested to the Plaintiff that it had not happened where, or in the manner, that he had described. He suggested that it was on the afternoon of 18 August (not the 19) that Mr Yuen had telephoned him and that he (Mr Man) had then spoken to the Plaintiff reprimanding him because he was in a hurry to finish his day's work, and telling him to comply with Mr Yuen's request to turn the water on. Mr Man further suggested that the Plaintiff had done this without incident on 18 August and that any injury which he had suffered was caused by an accident later that evening when the Plaintiff was working for someone else.

39. The Plaintiff denied each and every one of those suggestions.

40. Towards the end of this cross-examination Mr Man again applied for an adjournment until the end of January 2000 saying that he wished to call Mr Yuen to give evidence; that he wished to seek an engineering expert and that he wished to check the record of his telephone calls in August 1995. I refused this application.

THE DEFENCE CASE

41. Adopting the content of his witness statement (dated and filed on 4 December 1999) as his evidence in chief Mr Man stated his case as he had put it to the Plaintiff in cross-examination. He told me about himself and the nature of the 3 defendant companies. As to the Plaintiff himself, Mr Man said that he was "clever, skilful experienced and energetic ... but he is lazy". He went on to say that the Plaintiff often wanted to return to the Mainland and that if he (Mr Man) refused to give him holiday for that purpose, the Plaintiff would hurt himself to get some sick leave.

42. He gave examples.

43. Mr Man then proceeded to suggest that the Plaintiff had fabricated the details concerning his accident to his wrist, and that he (Mr Man) realized this in 1995 but did nothing about it, and indeed agreed with the Plaintiff to pay him a substantial amount of compensation thinking that that would be the end of the matter.

44. In his witness statement Mr Man gives reasons why he doubts that the accident happened as described by the Plaintiff.

45. Cross-examined by Mr Wong, Counsel for the Plaintiff, Mr Man was asked in some detail about the content of his "2nd affidavit" signed on 4 December 1999 and, in particular, what he said there about salary slips given to the Plaintiff and the name of the companies appearing on those slips apparently as employers.

46. Mr Man sought to say that the reason why the 3rd Defendant's name appeared on many of those slips was because it was "an ad hoc financial arrangement between the 2nd and 3rd Defendants and that the amendment of the heading was a careless mistake of the clerk".

47. Despite the fact that the 3rd Defendant's name appeared on many of those slips, and in particular on the slips relevant to the period in which the accident took place, Mr Man denied that the Plaintiff was ever on the payroll of the 3rd Defendant.

48. After he had agreed that he was the majority shareholder and the only active director in each of the 3 defendant companies and the man in charge, Mr Man went on to say how the companies were managed. He denied a suggestion that, to all intents and purposes, the Plaintiff was employed by all 3 companies.

49. Mr Man was then asked about the document which he had signed which was dated 30 August 1995 and which is entitled

"Form 2. Notice by employer of ... an accident to an employee resulting in ... in capacity."

50. He was asked why it was that in that notice the 1st Defendant's name had been inserted as the employer of the Plaintiff; how it was that he, as the signatory, had agreed that the accident had occurred on 19 August 1995 in the premises of the 1st Defendant and that it had happened when the Plaintiff fell from a ladder.

51. Among other things Mr Man said that the 1st Defendant's name had been entered on the form as the Plaintiff's employer because the 1st Defendant was insured and he wished to claim on that company's policy.

52. As to the form of agreement entered into by Mr Man and the Plaintiff for compensation under Chapter 282, Mr Man was asked by Mr Wong why it was that he had signed that document when he harboured real doubts about the Plaintiff's account of the accident and his (Mr Man's) liability to pay any compensation. To that Mr Man replied that his decision to enter into that agreement was, as he put it, a commercial decision, and that he realized that he would have great difficulty in disputing the Plaintiff's claim.

53. When asked about the contents of Clause 10 of that agreement, which made it clear that no subsequent claims would be affected by it, Mr Man said that he had not read that clause carefully.

54. When it was suggested to Mr Man that the injury caused to the Plaintiff was caused by the negligence of the 3 defendant companies, he denied that this was so, saying that he had "provided [the Plaintiff] with long ladders".

CONCLUSION

Liability

55. I am in no doubt whatsoever that the reality was that the Plaintiff, in 1995, was employed by Mr Man in his position as the principal shareholder and the only working director of each of the Defendant companies. The Plaintiff worked to Mr Man's instructions in that capacity as a trusted general manual labourer which instructions were issued, in essence, on behalf of all 3 companies.

56. Not surprisingly Mr Man used his companies and their operations in his best commercial interests as he perceived them to be. When it suited the purposes of his companies (and thus his own purposes) for any particular one of them to pay the wages of the Plaintiff, then this was arranged: when it suited the purposes of his companies (and thus his own purposes) to say that the 1st Defendant company was the employer of the Plaintiff, because that was the only one of his 3 companies which carried the appropriate insurance for industrial accidents, then he said so: when it suited the purposes of his companies (and thus his own purposes) to say that the Plaintiff was employed by the 2nd Defendant company because that company had gone into liquidation and could not be expected to meet any financial claim, then he said so.

57. On all of the evidence before me I am quite satisfied that the Plaintiff was, at the time of his accident, an employee of each of the Defendant companies jointly and severally. As such, each of the companies owed a duty to the Plaintiff to take all reasonable precautions for his safety in that employ: a duty not to expose him to any risk of damage or injury of which they knew or ought to have known; a duty to provide and maintain a safe and proper system of work; a duty to ensure that the place where he was instructed to work, and access to it, was safe; and a duty to provide readily accessible safe equipment.

58. I am in no doubt whatsoever that the Plaintiff's account of the accident, as given to me in evidence, was an entirely truthful account. I accept his evidence about it and about its medical consequences. I reject, in its entirety, Mr Man's account of matters. In so far as that account was not based upon self-serving conjecture it was, in my judgment, untruthful. Mr Man is plainly an intelligent, articulate and educated man, but he has also been shown to be, in my view, a highly imaginative and manipulative man in his conduct of these proceedings and in his activities preceding them. His 'last minute' allegations aimed at the Plaintiff, and in particular his suggestion that the Plaintiff, having suffered his injury elsewhere, went to Mr Man's premises and there falsely constructed a scene of accident, are nothing short of disgraceful.

59. It follows from all that I have said thus far that I find that, at the time of the accident, the Plaintiff was employed by all 3 Defendants; that he was acting in the course of his duty; and that each of the Defendants was in breach of its duty to him.

60. Liability in relation to the 1st Defendant is not strictly in issue before me in view of the interlocutory judgment entered against that company. It is in issue in relation to the 2nd and 3rd Defendants. The only difficulty that I have had in determining, as I do, that the Plaintiff succeeds against those two defendants as well as against the 1st Defendant both in contract and in tort, is whether or not the Plaintiff contributed to his accident by his own negligence.

61. Whilst I have considered carefully all that Mr Wong helpfully said to me about this issue and, in particular what he said concerning the defence pleadings, I am quite satisfied that not only was it (as a matter of common sense) unsafe for anybody to use the unsecured shorter ladder balanced on a steel table to climb to and from the cockloft, the Plaintiff was aware of that. Indeed as I have already stated in this judgment, albeit that the ladder had been in position for some time, the Plaintiff had declined to make use of it unless there were other fellow workers present.

62. Whilst I accept, on the evidence before me, that on 19 August 1995 the Plaintiff was instructed by Mr Man to go up to the cockloft, and to do so quickly, and that there was no other readily available means of access to that cockloft except by way of the short ladder, I am conscious of what is said in para. 3-23 on page 76 of Clerk and Lindsell on Torts (17th Edition) as follows:-

"In ordinary circumstances a plaintiff is bound for his own protection to keep his eyes open and take proper precautions to guard against the occurrence of an accident, if he places his person ... in a position of some degree of danger, or does any other act from which consequences injurious to himself are likely to flow. However, where he has been thrown off his guard by the conduct of the defendant, and reasonably induced to believe that he may do the act with safety, a less degree of care and circumspection is required of him."

63. Whilst in the present case it may properly be said that the conduct of Mr Man in hurrying him along against his better judgment threw the Plaintiff off his guard, it cannot in my view be said that the Plaintiff was in any way induced by Mr Man to believe that the use of the ladder was safe.

64. For these reasons, whilst I find that the Plaintiff succeeds on liability against each of the Defendants jointly and severally, he does so limited to the extent of 66.6%, he having contributed 33.3% to the accident by his own negligence.

QUANTUM

Pain and Suffering and Loss of Amenity

65. The medical evidence, which I have recited herein, is clear and precise. I accept that the Plaintiff's pain and disability is as described in that evidence.

66. On full liability I assess general damages under this head at $275,000.00. 66.6% = $183,150.00

Pre-trial loss of earnings

67. From the available evidence the Plaintiff's average monthly wage prior to his accident was about $9,360.00.

(a) For the period between 19 August 1995 until 19 June 1996.

$9,360.00 x 10 =	$93,600.00
66.6% =	$62,338.00

(b) For the period from July 1998 until trial (16 months) I employ the Plaintiff's last received monthly salary ($9,520.00) and assuming, as I do, despite his failure to secure an interview and hence employment, a realistic ability to earn $5,725.00 per month (see future loss of earnings for that figure) I assess his loss (bearing in mind that he in fact earned $10,000.00) as follows: -

$9,520.00 - $5,725.00 x 16 =	$60,720.00
66.6% =	$40,440.00	$62,338.00
		$40,440.00
		$102,778.00 =========

Pre-trial expenses

68. I make an award under this head as follows: -

Hospital fees		$180.00
Follow-up		$1,160.00
Occupational therapy		$1,320.00
Further treatment		$28.00
Metal stick		$110.00
Nourishing Food ($5,000 claimed)		$3,000.00
		$5,798.00
	66.6% =	$3,861.00

Future loss of earnings

69. The appropriate multiplier is, in my view, 4.

70. Assuming employment as a watchman, (caretaker or the like) at $5,725.00 per month (statistics of Selective Placement Division of the Labour Department) the calculation is: -

($9,520.00 - $5,725.00) x 12 x 4 =	$182,160.00
66.6% =	$121,319.00

Loss of earning capacity

71. As conceded by Mr Wong for the Plaintiff I make no award under this head.

Summary

(a) PSLA		$183,150.00
(b) Interest at 2% for 1.66 years		$6,081.00
(c) Pre-trial loss of earnings		$102,778.00
(d) Pre-trial expenses		$3,861.00
(e) Interest at 5.63% for 4.29 years		$25,756.00
(f) Future loss of earnings		$121,319.00
		$442,945.00
Less credit for ECC		$107,640.00
		$335,305.00
		==========

72. There will be judgment for the Plaintiff for $335,305.00.

73. I make an order nisi that the Defendants do pay the costs of the Plaintiff such costs to taxed upon a common fund basis. The Plaintiff's own costs will be taxed in accordance with legal aid regulations.