TSUI SHUK FONG AND ANOTHER v. CHAN CHU SUN t/a WAI TAT CONSTRUCTION ENGINEERING CO.

HCPI 979/98

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 979 OF 1998

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J U D G M E N T

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1. This is a claim for damages arising out of the death of the first named Plaintiff's husband in the course of his employment on the 23 September 1995. He was engaged in the demolition of a concrete partition wall of a flat in a block in Broadwood Road, Hong Kong. The wall collapsed upon him and caused his death.

2. Originally the action was brought against the 1st Defendant as subcontractor who employed the deceased, and the 2nd Defendant as main contractor on the site. Following the judgement in the proceedings brought in the District Court by the Plaintiffs under the Employees' Compensation Ordinance, the action was discontinued against the 2nd Defendant. The 1st Defendant, although represented initially by solicitors and with the benefit of a Legal Aid Certificate, has taken no part in these proceedings since the hearing in the District Court which gave judgment for the plaintiffs against him alone.

3. The issues raised in the Defence served in this action have been fully dealt with in the opening submissions succinctly set out by Miss Anita Yip who appears for the Plaintiff. I will deal with them shortly.

4. The Plaintiffs' capacity to sue was not admitted in paragraph 1 of the Defence. The Letters of Administration granted to the Plantiffs in respect of the deceaseds' estate answers this.

5. The fatal accident was denied in paragraph 11 of the Defence. There is ample uncontroverted evidence that the deceased met his death on the 23rd September 1995 when the concrete wall collapsed upon him at the site. In the Employees' Compensation proceedings commenced against the 1st Defendant in 1996 the learned District Judge reviewed the Coroner's findings as to the circumstances of the deceased's injuries and "could find no other explanation" but that "the deceased must have suffered the fatal injuries when he was tearing down the wall in the said premises." This finding is res judicata. The Defence puts forward no contrary averment to account for the deceased's death. In any event the Coroner's findings have not been challenged.

6. The third issue is at the heart of the Defence. Was the deceased an independent contractor or was he an employee of the 1st Defendant? This issue featured as the main issue in the Employees Compensation proceedings. Evidence given there included the sworn testimony of the 1st Defendant who was cross-examined by Miss Yip, who also appeared in these proceedings on behalf of these Plaintiffs (as Applicants). On page 233 (to 234) the learned District Judge set out his findings in this regard - "I have no hesitation to say that the deceased worked for the 1st Respondent (the 1st Defendant) .............. the deceased was the employee of the 1st Respondent." These findings are "res judicata" or issue estoppel. See Wood v. Luscombe 1966 I.Q.B. p. 169; Henderson v. Henderson 1843. 3 Hare p.100; Wain v. F Sherwood & Sons Transport Ltd (The Times - 16 July 1998); Wong Wang Sum v. Lee Kam Engineering Co (A Firm) & Anor 1996 3 H.K.C. p. 627; and; Chung Mou Sau v. Ho Keung and Others HCPI No. 11420 of 1995 (24 July 1998)

7. The final issue - was there breach of duty of care or negligence on the part of the Defendant employer? - is essentially a matter for me but this was canvassed fully in the Employees' Compensation proceedings when the Defendant, as stated earlier gave evidence and was cross-examined. The non-delegable duty of care owed by the Defendant to the deceased as employer, needs no reassertion. The factual detail of the work being carried out by the deceased included admissions by the Defendant that instructed the deceased to contact the foreman on site to identify the demolition work, that he sent two other workers to the site to clear the débris and that he had given general instructions to the deceased as to which walls were to be dismantled and how to go about it - i.e. work from top to bottom. The Defendant's evidence in one forum was contradictory to that given by him in another. At one stage he attended the premises to see how the deceased was getting on with the work.

8. The Assistant Building Surveyor who attended the premises, concluded that the collapse of the wall was due to "incorrect demolition procedures." The findings of the Factory Inspector were consistent with this. An abutting partition wall had already been demolished leaving one partition wall unsupported. There was some evidence of chipping away at the lower part of the wall possibly to facilitate eventual demolition. It seems that once the supporting abutting wall had been demolished, the remaining wall was likely to collapse if demolition proceeded from the bottom or even from the top. The whole system or plan - if there was one - was fraught with danger. The employer's obligations to devise and institute a safe system of work was not fulfilled. Similarly, there was no supervision or instruction. The employer was unarguably negligent. There being no pleaded allegation of contributory negligence on the part of the deceased, the employer was wholly liable for this tragic accident and there will be judgment for the Plantiffs accordingly.

QUANTUM

Dependency

Pre-trial

9. The deceased was only 40 at the time of his death. His average monthly income was $18,000. He gave his wife $11,000 monthly for running the home and the family. He sent a further $1,200 monthly to his parents on the mainland. A further $1,000 monthly was spent on family outings. He kept about $3,000 monthly for this own expenses and saved a further $1,800. His widow has given evidence as to these figures. Within the monthly sum for running the home and family is an element for his own benefit. This applies equally to the modest figure for family outings. The earnings of $18,000 are therefore initially reduced by $4,800 (his expenses plus the savings) leaving a figure of $13,200. That should be reduced by a percentage to reflect the element of cost or expense in respect of the deceased. $12,000 monthly would be a reasonable dependency figure.

10. Since his death, his earnings would have increased, according to the Census and Statistics Department, to about $21,620 by the date of trial. Over the five year pre-trial period this averages out at $21,620 of which 60% (12,000/18,000%) would be $12,972. The pre-trial loss of dependency is therefore 12,972 x 12 x 5 = $778,320.

Post-Trial Dependency

11. I agree with Miss Yip that 14 would be the correct multiplier given the deceased's age. That leaves a balance of 9.

12. The dependency figure is to be calculated from the current wage level of $25,240 monthly, 60% of which is 15,144. However, I think this man would be likely to apply more for the general maintenance of the family and less to his own spending. His children are now incurring more expenses, a natural consequence of the teenage period. The more likely dependency figure is nearer $17,000.

13. The two children are likely to be dependent for a number of years and I consider a multiplier of 6 is reasonable. This produces $1,224,000 (17,000 x 12 x 6).

14. The parents of the deceased would soon cease to be dependants given their relative ages. It would be reasonable to let them remain within the dependency figure for two of the six years of the remaining multiplier. The question then arises as to how to deal with their proportion of the dependency figure thereafter. Would it be reasonable to regard it as forming part of the family's dependency or would it have formed part of the savings accumulated? I think the available sum would have been applied for the benefit of the family and particularly the children. Accordingly there should be no reduction in the dependency for this six year period.

15. The remaining part of the multiplier, three years, should be for the widow but allowing something for the fact that the children, though no longer strictly dependent, would nonetheless benefit, as most children do, from their parents' generosity. The figure will be $17,000 less a proportion to represent the fact the parents and children are no longer direct dependents (and the parents not at all). Would that fixed sum have been used by the deceased, and/or saved? Or is it likely to have been applied in both directions? Any calculation as to what that figure should be is speculative. As far as the savings element is concerned it matters not whether it is extracted and put into the loss of accumulation of wealth or ignored and left as part of the dependency. I propose to leave it as dependency. From the dependency figure, it would be reasonable to deduct a further $3,000 monthly as the deceased's likely increased expenses. This leaves $14,000 x 12 x 3 as the final dependency figure = $604,000.

Loss of Accumulation of Wealth

Pre-Trial

16. The Plaintiffs' case is that the deceased saved about $1,800 per month at the time of his death. There is clear evidence of savings by him in bank accounts. In one at the date of his death there was a little over $95,000. In the other at the same date there was $150,000. Monthly savings of $1,800 would produce $21,600 in a year. Over the five years pre-trial I accept that there would have been some increase in his savings in line with the increase in wages. The average over that period has been calculated at $2,100 per month. The total is therefore $2,100 x 12 x 5 = $126,000.

Post-trial

17. At trial the projected figure is $2,400 per month. When considering the post-trial dependency I considered whether or not the fact that the deceased's parents and the children would cease to be dependents should result in more money being saved monthly. In the event I concluded that it was more likely that the wife's dependency would increase and surplus earnings would be devoted to the children rather than to hard savings. It is highly speculative but makes no difference in the long run. Therefore, the post-trial savings should be regarded as continuing at the level of $2,400 monthly. The figure under this head will therefore be $2,400 x 12 x 9 = $259,200.

Bereavement Award

18. This is fixed by statute at $70,000.

Funeral Expenses

19. These total $71,887 and are allowed in full.

Summary:

20. There will be judgment for the Plaintiffs for $2,034,342 damages credit having been given for the said Employees' Compensation payment together with interest on the relevant items at the appropriate rates for the respective periods, to be calculated by the Plantiffs' Solicitors taking into account the earlier receipt of the E.C. money, and costs to be taxed.

Apportionment

The deceased's parents

21. The five year period pre-trial produces $81,000 (1,350 x 12 x 5). Post-trial the figure is $36,000 (1,500 x 12 x 2). The total is $117,000 plus interest.

The deceased's children

22. It is appropriate to apportion a lump sum to each of them for the Court to hold and invest on their behalf until both attain 18 years. It is not appropriate to carry out an artificial exercise in calculating the element of their past and future dependency and then isolating that figure. Their mother has been supporting them to date and will continue to do so out of the funds. The lump sum for each of them is to constitute a cushion for them as they enter adult life, having been deprived of material support from their father.

23. The son is 16 years of age and the daughter 12 years. It would be invidious to distinguish between them. In deciding on the appropriate figure for them I have to have regard to the total figure of damages not the net figure after deduction of the Employees' Compensation. In my view the figure should be $150,000 each.

24. The total of $300,000 must be paid into Court for investment by the Registrar on the usual terms.