CHENG WAI LI v. FAR EAST ALUMINIUM WORKS CO LTD AND OTHERS

CACV 115/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 115 OF 2008

(ON APPEAL FROM DCPI NO. 441 OF 2006)

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J U D G M E N T

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Hon Tang VP (giving the judgment of the Court):

Introduction

1.  On 29 June 2004, the plaintiff was injured as he was climbing up the cat ladder to the roof of the kiosk at gridline D5 on Level 4 of Langham Place (“the site”), when the trapdoor of the hatch suddenly closed and hit him on the head. 

2.  On one side of the roof there were smoke vent windows.  There were 4 rows each of 4 marble slabs on the windowsill of the smoke vent windows.  Each marble slab weighed around 80 lb.  The smoke vent windows opened at an angle of about 45°. 

3.  The smoke vent windows were part of a smoke control system for the grand atrium at L4 of the retail tower.  When the fire alarm system was actuated, the smoke vent windows would open automatically for ventilation.  The smoke vent windows could also be opened manually solely by the smoke vent manual switch.  It would take the smoke vent windows 48 seconds to open properly.

4.  At the time of the accident, for reasons unknown, the smoke vent windows opened, as a result the marble slabs which had been resting against the smoke vent windows fell off the windowsill and some of them fell on the trapdoor closing it.

5.  The marble slabs were meant to be on the windowsill temporarily but before they were removed, the accident occurred. 

6.  The 1^st defendant was the subcontractor who was responsible for the installation of curtain walls including smoke vent windows.  The plaintiff was the 1^st defendant’s site supervisor whose job was to arrange and supervise the installation work on the site.

7.  The 2^nd defendant was the main contractor responsible for the construction of the two buildings, namely, the Office Tower and the Retail Tower on the site.

8.  The 3^rd defendant was the sub-subcontractor of the 2^nd defendant and was responsible for the marble work on the site.

9.  The learned judge held that the 1^st defendant was liable to the plaintiff because, for example, it had failed to provide the plaintiff with a safe working environment.  He also held that the 2^nd defendant was liable to the plaintiff in negligence because it had, for example, failed to put warning signs on the smoke vent windows to warn people against putting objects against them or on the windowsill, and that such negligence resulted in the plaintiff’s injuries.  As for the 3^rd defendant, he was held by the learned judge to be negligent and liable to the plaintiff because the 3^rd defendant’s employees had put the marble slabs against the smoke vent windows and on the windowsill.

10.  The learned judge held that all three defendants were jointly and severally liable for the plaintiff’s injury.  He awarded damages in the total sum of $631,020 from which he deducted the amount of $335,169.80, being the employee compensation already paid by the 1^st defendant to the plaintiff.

11.  Notice of contribution or indemnity had been issued by the 1^st defendant against the 2^nd and 3^rd defendants respectively under the Civil Liability (Contribution) Ordinance, Cap. 377 (“CLCO”):

“… in respect of any sum which the Plaintiff may recover herein against the 1^st Defendant to the extent of such amount as may be found by the Court to be just  and equitable on the ground that the above-mentioned accident was caused wholly or contributed to by the negligence and/or breach of contract of employment and/or breach of statutory duty on the part of the (2^nd and/or 3^rd Defendant).”

12.  However, the learned judge held in para. 28 that because the defendants were severally as well as jointly liable no question of contribution can arise.  The learned judge said:

“28.  本席裁定，三名被告人需共同及單獨地負起原告人受傷的責任。由於各被告人需獨立地為意外的發生負責，因此他/它們之間不存在彌償的問題。”

The appeal

13.  This is the 1^st defendant’s appeal against the learned judge’s refusal to order contribution.

14.  Having regard to the amount involved, the parties agreed that should we be of the view that the learned judge was wrong in relation to the question of contribution, we should apportion liability ourselves instead of remitting the matter to the learned judge. 

15.  With respect to the learned judge, we are of the view that precisely because the defendants were jointly and severally liable for the plaintiff’s injury, the learned judge should have gone on to consider the question of contribution.  Section 3(1) of CLCO provides

“(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).”

16.  A short citation from Winfield and Jolowicz on Tort, (17^th ed), 2006 at p. 921 illustrates the point:

“…The simplest case of joint and several liability is that of two virtually simultaneous acts of negligence, as where two drivers behave negligently and collide, injuring a passenger in one of the cars or a pedestrian, but there is no requirement that the acts be simultaneous. Thus if Dl driving too fast in icy conditions causes his lorry to ‘jack-knife’ across the motorway and D2, also driving too fast, later comes along and, trying to avoid the obstruction, runs down C, assisting at the scene, both Dl and D2 may be liable for C's injuries. Of course it may be on the facts the act of D1 is held to have lost its causative effect. The acts of the two defendants may be separated by a substantial period of time and yet contribute to one, indivisible injury for this purpose, as where D1 manufactures a dangerous product and D2 uses it without due care years later. In all these case there is no logical or sensible basis for dividing up the causative origin of the claimant's injury between the defendants. If, for example, he is killed in the accident one cannot say that he was half killed by D1 and half killed by D2-he was killed by the effect of the conduct of both of them.”

17.  Mr Wong appearing for the 1^st defendant suggested equal apportionment of responsibility.  Mr Lee appearing for the 2^nd defendant agreed that an apportionment of one-third to each of the defendants would be reasonable.  The 3^rd defendant, who appeared in person, submitted that he should not be held liable for more than 20% of the loss.  He submitted so because according to him, he was just a subcontractor for the installation of the marble slabs and that the marble slabs did not belong to him.  But he accepted that it was his own workers who had left the marble slabs on the windowsill.  In such circumstances, we believe an equal apportionment to be appropriate.

18.  A major issue between the 1^st and 2^nd defendants is whether the amount in relation to which contribution could be sought should be confined to the net amount of $295,850.20 after deduction of the employees compensation of $335,169.80, or whether the 1^st defendant is entitled to contribution in respect of a total sum of $631,020. 

19.  As we understand Mr Lee’s submission, he seemed to have submitted that because the 1^st defendant was liable to pay and had paid compensation to the plaintiff under the Employees’ Compensation Ordinance (“ECO”), Cap. 282 and that under section 25(1)(b) of the ECO, the employer would only be entitled to an indemnity if he was faultless, but as the 1^st defendant was not faultless, the 1^st defendant was not entitled to an indemnity in respect of the compensation paid under the ECO – even though the 1^st defendant has not made any claim under that Ordinance.  Mr Lee, however, seemed to have accepted that the 1^st defendant would be entitled to contribution under section 3(2) of CLCO.  So he submitted the contributions should be limited to the difference between the common law damages and the ECO compensation.

20.  Mr Lee relied on Yardway Motors Ltd and Tam Siu Lun [2005] 2 HKLRD 118 in particular on what Yuen JA said at para. 60:

“60.  Accordingly, when s.25(1)(b) ECO is construed in the light of the rest of s.25 as well as s.27, it is clear that it does not provide for the partly-to-blame employer to recover, from the third party, compensation that he (the employer) has paid to the employee (or members of his family).  This was also the conclusion reached by McMahon Dep. J (now McMahon J) in Wong Yat-chiu v Chan Kwok Wa [1999] HKLRD 847, although on the facts found in that case, his views on the point were obiter.  I respectfully agree with the reasons given by the learned judge at 867-872.”

21.  As the judgment at first instance in Yardway shows, the plaintiffs who were the employer of the deceased mechanic had paid compensation under ECO of $1,230,494 to the dependants of the deceased.  The plaintiff’s claim for contribution was brought under both section 25 of ECO and the CLCO.  The amount claimed was in respect of the total sum paid under the ECO which presumably was taken to be:

“…the amount of damages, if any, which in the opinion of the court would have been awarded to the employee but for the provisions of (ECO).” Section 25(1)(b)

22.  The deceased died when he was hit by the front of the defendant’s lorry, which lurched forward when the defendant turned on the ignition as it was in gear.

23.  The learned trial judge held that:

“15.  … the defendant was negligent and that his negligence was the major cause of the accident. …”,

but that the learned trial judge also held that:

“20.  … the plaintiffs to have been negligent in respect of the accident in this regard.”

24.  The learned trial judge held that the plaintiffs were entitled to contribution both under section 25 of ECO and the CLCO, and ordered the defendant to pay 7/8ths of the damages.

25.  The defendant appealed.  In this court the majority view was that the plaintiffs were not entitled to contribution under section 25 of ECO, since the plaintiffs were partly responsible for the accident.  Per Le Pichon JA at para. 41 and Yuen JA at para. 60.

26.  More importantly for our purpose is that this court was unanimous in Yardway in affirming the learned trial judge’s conclusion that the plaintiff were entitled to a 7/8^th contribution from the defendant under CLCO in respect of the entirety of the plaintiffs’ claim against the defendant which, it will be recalled, was the employee compensation paid by the plaintiffs to the deceased’s dependants.

27.  Nor would Rogers VP’s judgment support Mr Lee. Rogers VP held the minority view that an employer who was partly responsible for the accident was entitled to contribution from the third party under section 25(1)(b).

28.  Mr Lee also relied on the judgment of Deputy Judge McMahon (as he then was) in Wong Yat Chiu and Anor v Chan Kwok Wa and Others [1999] 2 HKLRD 849.  There the learned deputy judge was of the view that only a faultless employer is entitled to an indemnity under section 25 of ECO from a tortfeasor.  It is clear from Deputy Judge McMahon’s citation from the judgment of Barwick CJ in the High Court of Australia in Public Transport Commissioner of New South Wales v. J. Murray-More (NSW) Pty Ltd. [1975] 132 CLR 336, that the Australian equivalent of section 25 of ECO would not preclude the employer who was partly at fault from claiming contribution under the equivalent of CLCO (p. 870).

29.  For the above reasons, we are of the view that the 1^st defendant is entitled to contribution from the 2^nd and 3^rd defendants in respect of the full amount awarded by the learned judge without any deduction.  The deduction ordered by the learned judge was made against the plaintiff only so that the plaintiff should not be over compensated and has no relevance to the 1^st defendant’s right of contribution.

30.  Accordingly, assuming the 1^st defendant has paid the plaintiff the full amount of $631,020, we order the 2^nd and 3^rd defendants to each contribute one-third of the amount paid by the 1^st defendant to the plaintiff, inclusive of the payment made under the ECO.  The 2^nd and 3^rd defendants must also pay the costs of the 1^st defendant in the appeal, such costs to be taxed unless agreed.  As for the costs below, the 1^st defendant is entitled to costs from the 2^nd defendant in relation to its claim for contribution against it, such costs are to be taxed unless agreed.