CHIU KWOK HUNG BAN v. NG FU WING t/a WING KEE AQUARIUM ENG CO AND OTHERS

DCEC 887/2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 887 OF 2002

DCEC 317/2004  

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 317 OF 2004

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(Consolidated pursuant to the Order dated 5^th December 2005)

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Decision on Costs

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Background

1. On 1 February 2010, this Court handed down its Judgment whereby the Applicant partially succeeded in his claim against the 2^nd, 3^rd and 4^th Respondents but lost his whole claim against the 1^st Respondent.  An order nisi for costs to follow the event was made at the end of the Judgment. 

2. The Applicant applies to vary the costs order for a Sanderson or Bullock Order so that the 1^st Respondent’s costs shall practically be borne by the 3^rd and 4^th Respondents.  The 1^st Respondent does not oppose a Bullock Order but opposes a Sanderson Order.  The 2^nd Respondent has been absent well before the present action and has remained so up till now.  The 3^rd Respondent, understandably as he acts in person, has made no application or submissions on costs.  The 4^th Respondent opposes a Sanderson or Bullock Order, and in addition, applies to reduce the Applicant’s costs to reflect the Applicant’s limited success in the present action.

3. No hearing is held as the parties have filed full written submissions on this issue of costs.

Appropriateness of Sanderson or Bullock Order

4. The precondition of either a Sanderson or Bullock Order is that the plaintiff has had difficulty ascertaining which defendant to sue and has properly, in the court’s view, sued two defendants in the alternative but succeeds against only one [HKCP 2010, Vol 1, 62/1/5 & 62/1/6]. 

5. Mr. Wong acting for the Applicant submits that the 1^st Respondent’s conduct had brought about the present action because he had not checked properly before signing Form 2, which stated that he was the Applicant’s employer.  I think the 1^st Respondent’s stance, of being misled by the 2^nd Respondent to sign Form 2, had been made clear and consistent at the stage of pleadings.  On the contrary, the Applicant had throughout been content with the state of his own pleadings which worded his claim against each respondent as “and/or”.  The Applicant only sought to clarify his stance vis-à-vis each respondent before trial commenced.  However, he still maintained his claim against the 1^st Respondent on the one hand as against the 3^rd and 4^th Respondents on the other hand. 

6. Apart from Form 2, there was no evidence to against the 1^st Respondent.  The Applicant’s cause of action against the 1^st Respondent was patently inconsistent with that against the other respondents.  When the pleadings had closed, there would have been no difficulty ascertaining which parties to sue.  Since then, the Applicant ought not to have proceeded against the 1^st Respondent.  In the premises, his application for a Sanderson or Bullock Order must fail. 

Applicant’s partial success and costs

7. In deciding what order for costs to make, the court must take into account the extent to which a party has succeeded [HKCP 2010, Vol 1, 65/5/7].

8. Mr. Kwong acting for the 4^th Respondent submits that the Applicant should only be entitled to 25% of the costs from the 4^th Respondent as the Applicant had failed in most issues as follows and only obtained less than 15% of the claim:

(1)   Failing to prove 20 days per month as the level of monthly wages as the Court found only 9 days;

(2)   Failing to prove he earned $16,000 per month as the level of monthly wages as the Court found only $7,200;

(3)   Failing to persuade the Court to use the Hong Kong Paper Mill Formula; 

(4)   Failing to prove sick leave of 801 days as the Court found only 492 days;

(5)   Failing to recover interest for 2 lengthy periods before trial due to inordinate delay in pursuing the action.

9. In my judgment, the most important issue, which the Applicant had failed to prove, was the number of working days hence monthly wages.  As a result, the award was substantially less than his claim.  Other parts of the award based on the sick leave period and interest were less important issues of the action. 

10. I agree with Mr. Kwong’s submissions that the Applicant should only get 25% of his costs with certificate for counsel from the 4^th Respondent.  I make the same order in respect of the Applicant’s costs to be paid by the 3^rd Respondent as both the 3^rd and 4^th Respondents are in the same situation. 

Costs of present submissions

11. The Applicant shall pay the costs of the 1^st and 4^th Respondents’ submissions with certificate for counsel.  The Applicant’s own costs shall be taxed in accordance with Legal Aid Regulations.  The costs order for this argument on costs shall become absolute after 28 days from today. 

DCEC 887/2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 887 OF 2002

DCEC 317/2004

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 317 OF 2004

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  (Consolidated pursuant to the Order dated 5^th December 2005)

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J U D G M E N T

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Background

1. The Applicant claims compensation arising out of injuries sustained in the course of his employment.  There is no dispute that the 4^th Respondent was the principal contractor, and the 3^rd Respondent its sub-contractor of the project the Applicant was on.  The 2^nd Respondent was throughout the present action.  Default judgment was given against him.  

Issues

2. This Court has to determine the following issues:

(1)   Liability: whether the Applicant was an independent contractor or the employee of which respondent(s);

(2)   Quantum.

Witnesses called

3. There are 4 witnesses who give evidence:

(1)    The Applicant;

(2)    The 1^st Respondent;

(3)    The 3^rd Respondent;

(4)    Li Chi-kan for the 4^th Respondent.

Facts not in issue

4. On 30 November 2000 at about 6:10 p.m., the Applicant, aged 33, was working as a painting worker for a renovation project (“the Project”) at a site situated at an automatic teller machine centre at Richland Gardens, Commercial Block (“the Site”). He fell from a height of 3 feet when climbing a wooden ladder.  He sustained injuries as a result. 

5. The 4^th Respondent was the principal contractor, and the 3^rd Respondent its sub-contractor, of the Project.  The 3^rd Respondent sub-contracted the Project to the 2^nd Respondent. 

6. The 1^st Respondent’s line of business was only for the construction and maintenance of fish tanks.  It did not any take part in the Project.  It did not have any projects in Richland Gardens.  Upon the alleged representation of his insurance agent and the 2^nd Respondent, he filled out Form 2 to the Labour Department acknowledging to be the Applicant’s employer.

Facts in issue

7. The 4^th Respondent says that usually such projects, like the Project, would be practically completed by 4 p.m.  It was unlikely to have anyone still working at the Site at, according to the Applicant’s evidence, 6:10 p.m.  I do not find such bare allegation strong enough to challenge the Applicant’s evidence.

8. The 4^th Respondent says that there had been a standing reminder, albeit oral, to the sub-contractor against sub-contracting out.  The 3^rd Respondent’s sub-contracting out, if ever, to the 2^nd Respondent would be a breach.  The 4^th Respondent would not have allowed it.  However, he was given to understand, from what the 2^nd Respondent had told him, that the 2^nd Respondent was the 3^rd Respondent’s project manager.  I do not see how such agreement, if any, between the 3^rd Respondent and the 4^th Respondent, could affect the Applicant’s claim. 

9. The 3^rd Respondent says that he had used his firm’s name to tender for Projects on behalf of the 2^nd Respondent on many occasions.  He did not regard himself as the actual employer.  I do not see how such private arrangement between himself and the 2^nd Respondent could affect the Applicant’s claim. 

10. The Applicant challenges the 1^st Respondent’s explanation as to why he came to sign the Form 2 acknowledging to be the Applicant’s employer.  The 1^st Respondent says that he was beguiled by the 2^nd Respondent into believing that the Applicant was a workman under him (the 1^st Respondent).  The 2^nd Respondent used to cooperate with him (the 1^st Respondent) in various projects from time to time.  Subsequently upon realizing such mistake, he wrote to the Labour Department in purported correction of the mistake.  I believe that he was not the Applicant’s employer. 

Liability: whether the Applicant was an independent contractor or the employee of which respondent(s)

11. The Applicant had 10 years’ experience in his trade and was a painting master.  He knew his job well.  He was not supervised by the 2^nd Respondent.  The 2^nd Respondent would decide what work he was to do.  He might go to work a bit later but he could not stall for time because it was the 2^nd Respondent who could decide how many days of work he would be given.  He had to work with different people who were also working for the 2^nd Respondent.  His daily wage was fixed at $800.  He used the ladder supplied by the 2^nd Respondent.  There is no challenge to such evidence and I find such proved.   

12. Ribeiro PJ, who delivered the judgment of  the Court of Final Appeal in Poon Chau Nam v Yim Siu Cheung [2007] 1 HKLR 951 said:

18.  The modern approach to the question whether one person is another’s employee is therefore to examine all the features of their relationship against the background of the indicia developed in the abovementioned case-law with a view to deciding whether, as a matter of overall impression, the relationship is one of employment, bearing in mind the purpose for which the question is asked.  It involves a nuanced and not a mechanical approach, as Mummery J emphasised in Hall v Lorimer[26] (in a passage approved by the English Court of Appeal[27]):

“In order to decide whether a person carries on business on his own account it is necessary to consider many different aspects of that person’s work activity.  This is not a mechanical exercise of running through items on a check list to see whether they are present in, or absent from, a given situation.  The object of the exercise is to paint a picture from the accumulation of detail.  The overall effect can only be appreciated by standing back from the detailed picture which has been painted, by viewing it from a distance and by making an informed, considered, qualitative appreciation of the whole.  It is a matter of evaluation of the overall effect of the detail, which is not necessarily the same as the sum total of the individual details.  Not all details are of equal weight or importance in any given situation. The details may also vary in importance from one situation to another.” (952D)

13. Applying the principle to the present facts, bar insolvency on the part of the 2^nd Respondent, the Applicant had little risk of loss of income but equally very little scope of increasing his income through better management of his work.  I am satisfied that he was being employed by the 2^nd Respondent.   

Quantum

Section 9 (permanent partial incapacity)

14. There is no dispute that the Applicant was earning $800 per day as a painting worker and he had been working for 9 days on the date of the accident.  The dispute is on how many days he had worked in either the month of the accident or the average month in the past 12 months, whichever most favourable to him.   Although Form 2 reported an average of “22 working days” [p. 207], even the Applicant says that it is not the correct figure.  He says that he worked 20 days on average in the past 12 months.  He had not filed any tax return for his earnings, though.  Mr. Kwong, counsel for the 4^th Respondent, criticizes “22 working days” as a bare allegation. 

15. Whilst the 4^th Respondent has no duty to put up a positive case, Mr. Kwong submits that the Applicant’s income at the relevant time might be less than $9,000 a month (or $108,000 a year as the threshold of taxable salary tax) so that no tax return was filed.  Mr. Wong assumes, in the absence of evidence, that there were reasons, not sinister ones, for the failure to file a tax return. 

16. I do not believe the Applicant’s case of “22 working days”.  He worked 9 days up to the date of the accident.  His income for the purpose of the present action is therefore $7,200 (i.e., $800 x 9). 

17. Mr. Wong refers to the government’s statistics on wages of unskilled workers for December 2000.  The range was between $5,503 as a refreshment server [p. 279-11], $6,502 as a watchman/guard [p. 279-12], and $6,761 as an office assistant [p. 279-3].  Mr. Kwong submits that Dr. Lau (the Applicant’s own expert) regarded [p. 190] that he can work as a clerk.  The range for a clerk was between $8,239 [p. 279-6] and $11,733 [p. 279-7].  I note that Dr. Lau was referring to “sedentary jobs such as office clerk, cashier, packaging factory worker, or car park attendant”.  A refreshment server’s or office assistant’s job is not “sedentary”.  From the jobs stated in the statistics for my consideration, I think he can work as a watchman/guard and earn $6,502 per month.  Mr. Wong submits that the Applicant can only get a lower income for want of experience in the job.  Mr. Kwong submits that such job requires little experience.  I agree.  The notional salary is $6,502.

18. The loss of earning capacity was assessed by the Assessment Panel as 14%, Dr. Lau as 20%, and Dr. Fu as 5%.  In view of my finding that the Applicant can work as a watchman/guard and earn $6,502 per month (i.e., the equivalent of 9.7% loss of earning capacity), the application of the Hong Kong Paper Mill formula here will only result in less compensation.

19. I accept 14% as the appropriate figure for assessing the loss of capacity.  Consequently, the calculations are as follows:

  $7,200 (pre-accident income)   x   14%   x   96 (months) =   $96,768

20. The sum is $96,768 under section 9 (permanent partial incapacity).

Section 10 (temporary incapacity)

21. Mr. Wong submits that sick leave is 801 days in total.  Mrs. Yang, counsel for the 1^st Respondent, contends that the period (of  309 days) from 17 December 2001 to 26 September 2002 was due to the Applicant’s cardiac condition which was not related to the accident.  It was only on 27 September 2002 that he underwent surgery as part of the treatment due to the accident.  Dr. Lau regarded 9 months would be a reasonable period of sick leave after surgery.  Dr. Fu regarded 1 year as reasonable.  In my judgment a reasonable period due to the accident should be 492 days (i.e., 801 days minus 309 days).  Consequently, the calculations are as follows:

   $7,200    x    12    ÷   365    x 492 (days) x    4/5    =     $93,170

Section 10A (medical expenses)

22. The Applicant had 3 surgeries, 38 sessions of physiotherapy, and 42 sessions of occupational therapy.  The claim is $7,491.  The respondents are not in a position to dispute it.  I allow the sum.  

Deductions for payment already received from the 2^nd Respondent

23. The Applicant admits having received from the 2^nd Respondent $24,000 as compensation due to the accident [p. 141].  This sum will be deducted from the sum the Applicant can recover.

Interest

24. Mr. Kwong submits that the Applicant should not get interest for 2 length periods, during which he has not pursued his claim promptly, as follows:

(1)    from 30 November 2000 to 1 January 2004;

(2)    from 19 May 2006 to 22 June 2009.

25. I order interest for those 2 periods to be excluded.   

Conclusion

26. The Applicant shall recover from the 2^nd, the 3^rd and the 4^th Respondents jointly and severally compensation but to be deducted $24,000 already received by the Applicant from the 2^nd Respondent.  The net sum before interest is $173,429.  The calculations are as follows:

(1)    Section 9 (permanent partial incapacity)      $96,768

(2)    Section 10 (temporary incapacity)      $93,170

(3)    Section 10A (medical expenses)   $7,491

(4)    Deduction   ($24,000)

27. The Applicant shall have interest of the net sum at judgment rate from the date of the accident until judgment but excluding those 2 periods as stated in paragraph 24 above.

28. I order nisi that the 2^nd, the 3^rd and the 4^th Respondents pay the Applicant’s costs with certificate for counsel and the Applicant pay the 1^st Respondent’s costs with certificate for counsel.  The Applicant’s own costs shall be taxed in accordance with Legal Aid Regulations.  This order shall be made absolute after 28 days. 

DCEC 887/2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 887 OF 2002

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D E C I S I O N

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1. The Applicant (“A”) is claiming against the present respondent, Ng Fu Wing trading as Wing Kee Aquarium Eng. Co. (“R1”) for compensation under the Employees’ Compensation Ordinance (“the Ordinance”).

2. By a summons dated 1^st March 2004 and amended on 16^th March 2004, A seeks:

a.      to join Lau Pak Yin (劉伯賢) (“Lau”) as the 2nd Respondent (“Intended R2”); Lee Chi Kwong trading as Hoyoh Construction & Decoration Co. as the 3rd Respondent (“Intended R3”); and Seedtron Development Consultants Limited as the 4th Respondent (“Intended R4”); and to make consequential amendments to the Application filed herein on 30^th September 2002 (“the Application”); and

b.     to amend the Application to specifically plead an appeal under s.18 of the Ordinance against the certificate of assessment dated 24^th September 2003 (“the Certificate”).

3. R1 takes a neutral stance to the above applications.  Intended R2 is absent and has filed no opposition.  Intended R3 and Intended R4, however, oppose the above applications.

The issues

4. The issues that I need to consider are as follows:

a. The accident occurred on 30^th November 2002 and the 24 months period for A to make a claim for compensation under s.14(1) of the Ordinance expired on 30^th November 2002.  Should A be allowed to join the intended respondents into these proceedings notwithstanding the time limitation under s.14 of the Ordinance?

b. A has already filed another employees’ compensation application under DCEC 317/2004 to appeal against the Certificate.  Should A be allowed to amend the Application herein to specifically plead an appeal against the same certificate notwithstanding DCEC 317/2004?

Background

5. The facts relevant to the Amended Summons are not in dispute and may be summarized chronologically.

6. In November 2000, A was asked by Intended R2 to work as a painter at an apartment in Kowloon Tong.

7. On 29^th November 2000, Intended R2 asked A to do work at the ATM Centre (“the ATM Centre”) of Hong Kong and Shanghai Banking Corporation (“HSBC”) in Richland Gardens.

8. On 30^th November 2000, A fell off a ladder and suffered personal injuries at ATM Centre.  He was admitted to and hospitalized in Kwong Wah Hospital (“the Hospital”).

9. Intended R2 visited A at the Hospital and informed A that A’s employer had taken out an insurance policy and an insurance agent would visit him in due course.  Later, Mr. Auto Chau, a life insurance consellor of American International Assurance Company (Bermuda) Limited, visited A at the Hospital.  Mr. Chau informed A that A’s employer was R1.

10. On 6^th December 2000, a “Notice by employer of the death of an employee or of an accident to an employee resulting in death or incapacity” (“Form 2”) in respect of the accident was submitted to the Labour Department.  Under “Column B: Particulars of employer” therein, the name of the employer is stated to be “Wing Kee Aquarium Eng. Co. / Ng Fung Wing 吳富榮”.

11. On 18^th December 2000, a “Notice to amend particulars” (資料更改通知書) was filed by “吳富榮” to amend the particulars provided under “Column F: Details of earnings of the employee” in Form 2.

12. By a business registration search dated 16^th July 2002, A’s solicitors learnt that the English name of the sole proprietor of Wing Kee Aquarium Eng. Co. should be Ng Fu Wing (instead of Ng Fung Wing as alleged in Form 2).

13. On 30^th September 2002, A issued the Application herein against R1, that is Ng Fu Wing trading as Wing Kee Aquarium Eng. Co.

14. In a letter dated 3^rdOctober 2002 from Messrs. Massie & Clement (“R1’s insurer’s solicitors”), solicitors acting for R1’s insurer, to A’s solicitors, it is stated that:

“Please note that Wing Kee Aquarium Eng. Co. was not the employer of your client nor were they a contractor at the accident location.  Our information shows that your client’s actual employer was a Mr. Lau Pak Yin [i.e. Intended R2].

Neither our client or (sic.) their insured is liable to pay compensation to your client.”

15. A then tried to contact Intended R2 with the means he had but to no avail.

16. A’s solicitors wrote to R1’s insurer’s solicitors on 13^th November 2002 to, inter alia, ask for the contact telephone number and address of Intended R2.  There has been no reply.

17. A’s solicitors also wrote to HSBC on 21^st November 2002 and 10^th December 2002 respectively to enquire whether Intended R2 was a contractor or sub-contractor and whether R1 was the principal contractor or contractor in respect of the work at ATM Centre.

18. In a letter dated 2^nd December 2002 from EC Harris (Hong Kong) Ltd to A’s solicitors, it is stated that:

“Thank you for your letter dated 21 November 2002…

EC Harris took up the facility management of [ATM Centre] … in October 2002 and … the management of the aforesaid premises was still in the hand of HSBC until 1 March 2001…

Under the above circumstance, we regret that we are unable to provide the information requested by you.”

19. In a letter dated 19^th December 2002 from Messrs. Hui & Lam, solicitors acting for Intended R4 (“Intended R4’s solicitors”), to A’s solicitors, it is stated that:

“We act for Seedtron Limited, the contractor for the renovation work provided to HSBC Telford Garden Branch in 2000.  Your letter dated 10 December 2002 addressed to HSBC has been passed to our client to follow up the enquiries made by you.”

20. In a further letter dated 9^th January 2003 from Intended R4’s solicitors to A’s solicitors, it is stated that:

“As a clarification, the correct name of our client to carry out the renovation work to HSBC Telford Garden Branch is Seedtron Development Consultants Limited [i.e. Intended R4].”

21. A’s solicitors wrote to Intended R4’s solicitors on 10^th January 2003 to enquire whether Intended R2 was a contractor or sub-contractor and whether R1 was the principal contractor or contractor in respect of the work at ATM Centre and further ask for contact particulars of Intended R2.

22. In a letter dated 29^th January 2003 from Intended R4’s solicitors to A’s solicitors, it is stated that:

“1. [Intended R2] trading as Hoyoh Construction & Decoration Co. … was our client’s sub-contractor in respect of the decoration work at [ATM Centre] (‘the Project’) and his latest contact phone no. is…

2. Our client was the principal contractor of the Project in or about November 2000.  Our client has no knowledge of [R1] was (sic.) the sub-contractor of [Intended R2]…”

23. A’s solicitors attempted to contact Intended R2 by means of the particulars provided by Intended R4’s solicitors but to no avail.

24. A’s solicitors conducted a business registration search on 30^th January 2003 and learnt that the sole proprietor of Hoyoh Construction & Decoration Co. should be Lee Chi Kwong (instead of Intended R2 as alleged in Intended R4’s solicitors’ letter dated 29^th January 2003).

25. A’s solicitors then wrote to Intended R2 at the addresses of Intended R4.  The letters have not been returned undelivered and there has been no reply from Intended R2 either.

26. In a letter dated 14^th February 2003 from Intended R4’s solicitors to A’s solicitors, it is stated that:

“1. Our client has no knowledge that [Intended R2] trading as Hoyoh Construction & Decoration Co. was the direct employer of your client.

…

As our client has no knowledge of the applicant (sic.) relationship with Hoyoh Construction & Decoration Co., we have no instruction to give our consent to your intended join (sic.) application.”

27. A’s solicitors spoke to Mr. Auto Chau with a view to locate Intended R2 but to no avail.

28. In the meantime, the Employees’ Compensation (Ordinary Assessment) Board issued the Certificate on 24^th September 2003 in respect of the accident.  The 6 months period for an appeal against the Certificate would expire on 23^rd March 2004.

29. A’s solicitors wrote to Intended R4’s solicitors on 20^th February 2004 to ask for the sub-contract between Intended R4 and its sub-contractor in order to confirm the identity of Intended R4’s sub-contractor.  There has been no reply.

30. A made the present applications by way of the summons dated 1^st March 2004.

31. On 16^th March 2004, the Court granted leave to A to amend the summons, gave directions for the filing of affidavit evidence and adjourned the amended summons for argument.

32. A’s solicitors wrote to Intended R3’s solicitors and Intended R4’s solicitors on 17^th and 22^nd March 2004 respectively inviting them to reconsider their stance, failing which A would make a fresh application to appeal against the Certificate under s.18 of the Ordinance.

33. By a letter dated 23^rd March 2004, Intended R3’s solicitors maintained R3’s opposition to the amended summons.

34. By 2 letters dated 22^nd and 23^rd March 2004 respectively, Intended R4’s solicitors indicated that the responsible officer of R4 was out of town.

35. On 23^rd March 2004, A filed the application in DCEC 317/2004.

Intended R3’s stance

36. It is Intended R3’s case that:

a. Intended R4 sub-contracted the work at ATM Centre to Intended R3 who, in turn, sub-contracted it to Intended R2.

b. Intended R3 first knew of A and the present proceedings in March 2004 when he was served with the summons. 

c. A had never been employed by Intended R3.   Intended R3 does not know the relationship between A and R1.

d. Intended R3 ceased business on 10/7/2003.

37. Intended R3 deposes in his affirmation that he now has difficulty gathering relevant information and documents as the works was done more than 3 years ago.  He has tried to contact Intended R2 after he learnt of these proceedings but has been unable to locate Intended R2.  He maintains that had A notified him earlier, he may be able to locate Intended R2 for further details and he could be in a better position.

Intended R4’s stance

38. Intended R4 admits on affirmation that it was the main contractor of the work at ATM Centre.  It, however, maintains that there had been no report for personal injury in respect of the work at ATM Centre and it only came to know about the accident through the letter dated 10^th December 2002 from A’s solicitors’ to HSBC.  By then, the 2-year limitation period had already expired.

Application to join the intended respondents?

39. The first substantive issue is whether A should be allowed to join the intended respondents into these proceedings so that A may claim compensation against them, notwithstanding the time limitation under s.14 of the Ordinance.

40. The accident occurred on 30^th November 2002.  Under s.14(1) of the Ordinance, A had 24 months from the occurrence of the accident to apply for compensation under the Ordinance.  This expired on 30^th November 2002.  Although A has filed the Application herein on 30^th September 2002, the said application was only made against R1.  A applied on 1^st March 2004, by the amended summons, to join the intended respondents into these proceedings.  In other words, A has been 15 months late in respect of his application against the intended respondents for compensation under the Ordinance!

41. Under s.14(4) of the Ordinance, the Court may receive and determine any application for compensation in any case notwithstanding that the application has not been made in due time as required by that subsection, if it is satisfied that there was “reasonable excuse” for the failure so to make an application.

42. As to what constitutes “reasonable excuse”, parties agree that I should adopt the interpretation propounded by His Honour Judge Charles in Wong Man-tak v. Shaws & Sons Limited [1957] DCLR 85 as follows (at 88-89):

“A reasonable excuse, in the ordinary sense of the phrase, means, in relation to a failure by an applicant to make his application for compensation within the prescribed period, that the failure was due to such cause or causes that it ought, as a matter of reason, to be excused. The phrase thus means the same as the phrase "reasonable cause" which occurred in section 14 of the Workmens' Compensation Act 1925 of the United Kingdom. The numerous authorities upon that phrase show that a cause for failure to make a claim within the prescribed period was reasonable, and therefore excused the failure, if it were:- a reasonable belief on the part of the applicant that his injury was trivial; or a mistaken diagnosis of his injury; or a belief in the applicant that a claim for compensation was unnecessary, when the belief had been induced by the employer in such circumstances as reasonably warranted it; or the inability of the applicant to transact business because of his injury. On the other hand, a cause was not reasonable if it were a belief by the applicant that it would be to his interest to defer or not to make a claim. (See Willis's Workmens' Compensation, 36th Ed., page 436 et. seq.).  Moreover, an applicant was not excused if he had a reasonable cause which operated only for part of the period: he had to have reasonable causes for the whole period.  Thus, while an applicant might delay making his claim until the last moment of the prescribed period, he was not entitled to be excused if his last moment claim was prevented by a reasonable cause unless he could show that he had good reason for not making his claim before that cause arose.  (Aldridge v Warwickshire Coal Company and Ashton v London North Eastern Railway.)  The principle to be deduced from the foregoing is, I think, that an applicant has a reasonable excuse for not making an application to the court for compensation within the prescribed time if his failure were due to a cause or causes other than unreasonable conduct or an unreasonable decision on his part.”

43. Miss Kam, solicitor for Intended R3, observes that A has learnt of the fact that Mr. Lee Chi Kwong was the proprietor of Hoyoh Construction & Decoration Co. from a business registration search as early as on 30^th January 2003.  However, it has taken A some 13 months to apply to join Intended R3 in to claim employee compensation against him.  Intended R3 has been prejudiced by the lateness as deposed in Intended R3’s affirmation.

44. Miss Sin, solicitor for Intended R4, makes similar complaint.  She says that A should have been prompted to consider Intended R2 as his direct employer since it was Intended R2 who had arranged A to work at the apartment in Kowloon Tong and at ATM Centre.  She further submits that A should have properly investigated the existence of a principal contractor for the work before given the fact that the section entitled “C: Particulars of principal contractor” in Form 2 has been left blank.  Lastly, she submits that the burden is on A to show that Intended R4 is not prejudiced by A’s late application.

45. I note from the undisputed facts highlighted above that between the occurrence of the accident (i.e. 30^th November 2002) and the filing of the Application herein (i.e. 30^th September 2002), A was led to believe that his employer was R1.  He was first informed by Intended R2 that an insurance agent from his employer would visit him.  An insurance agent did visit him in hospital and informed him that R1 was his employer.  This fact was apparently confirmed by the Form 2 and the change of particulars apparently filed by R1 in December 2000.

46. It is true that the section entitled “C: Particulars of principal contractor” in Form 2 has been left blank.  Miss Sin even suggests that it is not uncommon for an employee in construction work not to know the identity of his principal contractor and so A’s solicitors should have done proper investigation.  In my view, there was simply nothing in the circumstances of this case as at date of the Application to hint at the existence of a principal contractor for the work.  It would be asking too much of the A’s solicitors, who may subsequently be criticized as wasting legal costs, to automatically launch into every possible investigation without proper legal and/or factual basis.  This is all the more so as there was clear admission that R1 was A’s employer (in terms of what A learnt from Mr. Auto Chau, Form 2 and the notice of change of particulars) and no mention of any principal contractor in Form 2.

47. According to the undisputed facts, A was only informed through R1’s insurer’s solicitors’ letter dated 3^rd October 2002 that R1 might not after all be A’s employer.  Since then, both A and his solicitors had been diligent, in my view, in ascertaining the true position.  They tried to contact Intended R2 and wrote to R1’s insurer’s solicitors, but without success.  In the meantime, the 24 months period under s.14(1) ran out on 30^th November 2002.

48. Again, according to the undisputed facts, A was only informed through Intended R4’s solicitors’ letters dated 19^th December 2002 and 9^th January 2003 respectively that Intended R4 had been the contractor responsible for the work at ATM Centre.  Even then, Intended R4 did not volunteer the fact that it had sub-contracted the work to someone else!

49. Given the above information from Intended R4’s solicitors and the information previously provided by R1’s insurer’s solicitors, A’s solicitors was then prompted to enquire (by their letter dated 10^th January 2003 to Intended R4’s solicitors) how R1, Intended R2 and Intended R4 were related in respect of the work at ATM Centre.  However, even then, Intended R4’s reply is anything but clear.  One simply cannot discern from their reply whether Intended R4 had sub-contracted the work to Intended R2 or Intended R3.

50. It was upon these circumstances that A made the joinder application on 1^st March 2003.  I have no difficulty in accepting A’s explanation that he simply did not appreciate his possible claim against Intended R2, Intended R3 and Intended R4 during the whole 2-year period under s.14(1) of the Ordinance. 

51. Miss Sin observes that A does not appear to know even by now who his direct employer was.  She submits that A should have applied for specific discovery to find out who his direct employer was instead of going on a fishing expedition by his joinder application to join in all possible parties.  I do not find this contention justified.  First, it will certainly take time to go on another round of specific discovery.  Secondly, Intended R4 has so far not replied to A’s solicitors’ letter dated 20^th February 2004.  In fact, Miss Sin has even submitted that Intended R4 is not obliged to assist A in pursuing his claim.  So there is nothing to suggest that any application for specific discovery will be met with a favourable reply from Intended R4.  Another round of specific discovery will mean further delay in A making his claim against the intended respondents.

52. Both Intended R3 and Intended R4 complain that that they have been prejudiced by A’s delay in that it is now difficult for them to locate relevant witness(es) (e.g. Intended R2) and document(s). 

53. In His Honour Judge Charles’ formulation of “reasonable excuse”, the focus is on the conduct or decision on the part of the employee in not making the application within the prescribed time.  In any event, I am not satisfied with the evidence before me that Intended R3 and Intended R4 have suffered any real prejudice, so much so that I should exercise my discretion to disallow the joinder application.

54. Miss Sin goes further and complains at the hearing on 11^th November 2005 that there has been delay on the part of A in prosecuting the amended summons.  On this latest complaint, Miss Leung (solicitor for A) replies that A has been driven by poverty to reside in the Mainland and so it has been difficult for A’s solicitors to obtain instruction.

55. In Lau Suet Fung (劉雪峰) v. Future Engineering Co. (富達工程公司), CACV 110/2003, counsel for the employee submitted to the Court of Appeal that in considering whether an employee had shown a reasonable excuse for not making the application within the prescribed time, any delay after the prescribed time was irrelevant.  The Court of Appeal found such submission unattractive.  The Court of Appeal considered a number of English, Australian and New Zealand cases and concluded (at paragraphs 68-69 of the Judgment) that:

“In Hong Kong, however, the statute is differently worded. Section 14(4) provides that ‘the Court may receive and determine any application for compensation in any case notwithstanding ... that the application has not been made in due time as required by that subsection, if it is satisfied that there was reasonable excuse for the failure ... to make an application...’ …

It is not a question of a statutory bar being lifted and thereby being ‘gone altogether’. The language in the Ordinance here is obviously discretionary, and in the exercise of its discretion whether to extend time, it is clear that a court would not assist a party who has slept on his rights.”

56. Returning to the present case, I accept that there has been some delay in prosecuting the amended summons.  However, I am of the view that such delay is not to the extent that I should exercise my discretion to disentitle A to claim against the intended respondents when he has clearly shown that he has reasonable excuse in not making the application within the prescribed time.

57. In the premises, I would allow A’s application to join the intended respondents into these proceedings and to make consequential amendments to the Application.

Amendment to specifically plead herein an appeal against the Certificate?

58. The second issue to be considered is whether A should be allowed to amend the Application herein to specifically plead an appeal against the Certificate when the same relief has already been asked for in DCEC 317/2004.

59. Both Miss Kam and Miss Sin argue that it is an abuse of court process for A to ask for the same relief in 2 separate employees’ compensation proceedings.

60. Miss Leung says that the 6 months period for A to appeal against the Certificate expired on 23^rd March 2004.  On 1^st March 2004, A applied for, inter alia, leave to amend the Application herein to specifically plead an appeal against the Certificate.  On 16^th March 2004, the application (in terms of the amended summons) was adjourned for argument.  A took out DCEC 317/2004 within the 6 months period to preserve his right to appeal against the Certificate pending the disposal of the amended summons.  Miss Leung submits that A would apply for consolidation after the disposal of the amended summons.

61. In the Application filed herein on 30^th September 2002, one of the relief A sought is “Appeal against the Certificate to be made, if necessary under section 18 of the Ordinance.”  It is common ground that the Certificate was only issued after the Application (i.e. on 24^th September 2003).

62. Under s.18(2) of the Ordinance:

“No appeal shall lie after the expiry of 6 months from the date of the decision or, in the case of an assessment, of the date of issue of the relevant certificate under section 16A, 16F, 16G or 16GA, as the case may be.”

63. In Chung Lung Shun v Adams Parking (International) Ltd, CACV 160/1995, Bokhary JA (as he then was) observed (at paragraphs 48-49) that:

“S. 18 appeals are not preceded by inactivity. By definition, appeals are preceded by some activity since there must be something to appeal from. As one sees from s. 18(1), there must be some decision or assessment to an appeal from … And, as one sees from s. 18(2) there is six months from the date of a decision or the issuance of a certificate of assessment within which to launch an appeal against such decision or certificate.

The jurisdiction of the District Court in a s. 18 appeal includes determining the amount of compensation payable and making such order in respect thereof, including any order as to costs, as it thinks fit. That enables the District Court to make an enforceable order for compensation. That no form has been prescribed for launching an appeal for that purpose does not defeat that purpose. The District Court has procedural power, as an inherent feature of its jurisdiction under s. 18, to allow an appeal to be brought before it under that section in any way which, as a matter of substance, duly invokes such jurisdiction. By ‘duly’ I mean plainly and with proper service on the other side.”

64. On 18^th August 2005, Her Honour Judge Ng issued the following Practice Note to practitioners in Lam Pui Yi Anita v. Secretary for Justice for and on behalf of Director of Food and Environmental Hygiene formerly known as Director of Urban Services, DCEC 844/2001 (at paragraphs 73-64):

“I note that it has become a common practice for practitioners to include in employees’ compensation claims the following prayer of relief in section 18A applications or in the answers, namely, an appeal against the Certificate of Assessment and/or Certificate of Review of Assessment ‘if necessary’, ‘if any’, ‘if so advised’ and/or ‘if appropriate’. Where such prayer of relief is included in the application or the answer, the court and the other party are at a loss to understand whether there is or is not going to be an appeal under Section 18. Sometimes much time and costs are wasted by the other party in addressing the possibility of an appeal when at the end of the day the pleader does not find it necessary, appropriate or advisable to appeal. Even worse, such prayer of relief is sometimes included in the section 18A application or answer even before the Certificate of Assessment or Certificate of Review Assessment comes into existence.

In my view, practitioners should desist from using such boilerplate prayer of relief for it serves no useful purpose. It does not tell the court or the other party whether there is an appeal or not and as such it does not plainly or duly invoke the court’s jurisdiction under Section 18. If it is made before the relevant Certificate(s) come into existence, it is invalid and has no meaning. An appeal under Section 18 is not to be made lightly and should be a considered decision having regard to the relevant circumstances. Such considered decision cannot be reached unless and until the relevant Certificate is at hand and hence the Ordinance specifies a statutory time period for appeal that commences on ‘the date of issue of the relevant certificate’.”

65. I would respectfully adopt the decision of Bokhary JA and the rationale behind Her Honour Judge Ng’s suggested practice quoted above.  I find that the relief claimed in the Application herein, in its unamended form, is invalid.  It is meaningless (as the Application pre-dated the Certificate) and does not as a matter of substance duly and plainly invokes the court’s jurisdiction under s.18 of the Ordinance.

66. Therefore, notwithstanding the Application, there was indeed a need for A to invoke the jurisdiction of the court under s.18 of the Ordinance.  That was apparently done in the application filed in DCEC 317/2004.

67. As the court’s jurisdiction under s.18 of the Ordinance has already been invoked and the appeal on foot, what A should have done, in my view, is to apply for consolidation ofthe 2 employees’ compensation proceedings and to make consequential amendment to the Application.

68. All the parties in DCEC 317/2004 were also present in the hearing before me.  This question of consolidation was touched upon in the submissions although not fully dealt with.  Be that as it may, Miss Kam and Miss Sin have so far not expressed any opposition to consolidation.  Miss Leung has already indicated that A will apply to consolidate the 2 proceedings in due course.  If I defer my decision on the application to amend the Application herein to specifically plead an appeal against the Certificate pending A’s formal application for consolidation, that would mean further legal costs and delay for the parties.

69. I am minded to order the consolidation of the 2 employees’ compensation proceedings now and, on that premises, grant leave to A to make consequential amendments to the Applicationherein including an amendment to specifically plead an appeal against the Certificate.  I grant parties liberty to apply within 14 days from the date of handing down of this decision, in case any party wishes to address me further on this issue of consolidation.  If there is no application, my above order in relation to consolidation and amendment will become absolute.

Conclusion

69. For the above reasons and subject to liberty to apply as aforesaid, I order that DCEC 887/2002 and DCEC 317/2004 be consolidated with DCEC 887/2002 being the lead proceedings and adopting the nomenclature of the parties in DCEC 887/2002 after consolidation.  I make an order in terms of the amended summons and further grant leave to A to make consequential amendment(s) to the Application for the purpose of the consolidation.

Miss T. Leung of Messrs. Cheng, Yeung & Co. for the Applicant.

Mr. K. Chan (6/10) & Miss Yu Wai-fong (11/11) of Messrs. Massie & Clement for 1^st Respondent.

Intended 2^nd Respondent, Mr. Lau Pak Yin (劉伯賢), in person, absent.

Miss Edith Kam of Messrs. Leonard K. L. Heung & Co. for the Intended 3^rd Respondent

Miss Abby Sin of Messrs. Hui & Lam for the Intended 4^th Respondent.