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Personal Injuries Action2008

FANG GUO QUAN AND ANOTHER v. CHOI MING SANG AND ANOTHER

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FANG GUO QUAN AND ANOTHER v. CHOI MING SANG WEISHENG BUS LTD AND ANOTHER

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DCPI 1468/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

PERSONAL INJURIES ACTION NO. 1468 OF 2008

________________________

BETWEEN

 FANG GUO QUAN and
YU YAN WEI
Plaintiffs

and

 CHOI MING SANG1st Defendant
 WEISHENG BUS LIMITED2nd Defendant
________________________

Before: Deputy District Judge J. Wong

Dates of Hearing: 19, 22, 23 and 24 November 2010

Date of Judgment: 23 December 2010

________________________

JUDGMENT

________________________

 

Introduction

1.  This is a claim by the Plaintiffs couple (referred to as “the Husband” and “the Wife” individually, if necessary) for loss and damages suffered by them at a traffic accident happened in PRC.

Background

2.  The Court of Appeal succinctly summed up the background of the case when they dismissed the 2nd Defendant’s appeal that the proper forum was the Court in PRC.

“1. The plaintiffs were passengers on a coach travelling from Hong Kong to Guangzhou on tickets which were bought at the 2nd defendant’s office in Hong Kong. The plaintiffs are residents of Hong Kong. The driver of the coach was the 1st defendant, who is also a resident of Hong Kong. The coach was travelling on the Guangzhou–Shenzhen Highway whilst being driven by the 1st defendant, when it was involved in an accident as a result of which the plaintiffs have sustained personal injuries. The plaintiffs had received their medical treatment in Hong Kong.

2. In this action, the plaintiffs claimed against the 1st defendant for negligence, the 2nd defendant, a company incorporated in Hong Kong and resident here, for breach of contract, as well as being vicariously liable for the negligence of 1st defendant who was allegedly an:

“… employee and/or agent of the 2nd Defendant …”.

3. The accident occurred on 24 July 2005.  The action was commenced on 7 July 2008.  …” 

(HCMP 1759/2009, Judgement dated 11.11.2009)

Preliminary matter

3.  At the outset of the trial, Ms. C. Tong, Counsel for the 1st Defendant, applied to amend her defence to the effect of bringing up the issue as to whether the Plaintiffs did or did not wear safety belts at the material time. Ms. L. Lau, Counsel for the 2nd Defendant agreed to the application, but not Mr. A. Lam, Counsel for the Plaintiffs.  Upon discussion, I allowed the application and agreed to give reasons later.  Here are them:

(a)  The safety belt issue is important. It affects quantum to be assessed, if necessary.  Without it, one of the real issues among the parties will not be determined by the Court.

(b)  The issue is factual and simple.  It could be easily resolved by, for example, production of a photo taken, a certificate about the coach, and so forth.  It was up to the parties to adduce evidence before this Court. In any event, at least, 3 witnesses would be able to testify before me.

(c)  I did not see any real or substantive prejudice suffered by the Plaintiffs.

The Defences

4.  The Defences may be summarized in the followings.

(a)  1st Defendant

(i) The accident was caused by the negligence of other drivers, not him.

(ii) The Plaintiffs were estopped and precluded from claiming him because after the accident, a group of persons, including the Plaintiffs, executed a waiver in favour of him.

(iii) If he would be however held liable, the Plaintiffs were contributory negligent because they failed to wear the seat belt.

(iv) Further, in any event, the damages were excessive.

(b) 2nd  Defendant

(i) It was only an agent to sell tickets for and on behalf of its principal, the service provider 廣東奔力冠一旅遊客運有限公司 (“奔力冠一”).  The coach licence 粵Z.BH04港was registered in the name of奔力冠一.  It also provided the coach, the driver (i.e. the 1st Defendant) and the insurance coverage in PRC.

(ii) The Plaintiffs were found sustaining no injures by the PRC hospital.

(iii) Thereafter, they waived the rights of compensation.  In reliance of it, 奔力冠一or the 2nd Defendant did not follow up the matter.  The Plaintiffs were therefore estopped and precluded from claiming it.

(iv) After all, the damages were also excessive.

Issues

5.  With the above in mind, coupled with the assistance from Mr. Lam in his opening, I further set out the issues as below:

(1) How did the accident happen?  Was it caused by the negligence of the 1st Defendant, or some other drivers?

(2) Did the Plaintiffs suffer injuries at the accident?

(3) After the accident, what intimation did the Plaintiffs make to the Mainland traffic police?  Under what circumstances they signed the “waiver” headed with “申請書”?  To whom the document was written?  What was written thereon and its legal effect?

(4) What was the relationship between the 2nd Defendant and 奔力冠一?

(5) Subject to (4), what was the relationship between the 2nd Defendant and the Plaintiffs? Was there a contract between them?  If so, did the contract contain an implied term of safety?   Further, if applicable, was the 2nd Defendant in breach?

(6) As an alternative to the contractual claim, did the 2nd Defendant owe a duty of care in tort to the Plaintiffs?  If so, was the 2nd Defendant in breach?

(7) Was the 2nd Defendant vicariously liable for the negligence of the 1st Defendant, if any?

(8) Subject to the determination of liability, were there safety belts available at the coach for the passengers at the material time?  If so, did the Plaintiffs wear them?

(9) Was the Plaintiffs’ claim excessive?  What are the appropriate damages to be awarded?

6.  It should be mentioned at this juncture that:

(a) Ms. Lau kindly confirmed that Hong Kong law was applicable to the present disputes.

(b) Subject to the determination of liability, all Counsel also kindly agreed the following quantum.

 (i) The Husband:$
  (1) Pre-trial loss of earnings 1,008.0
  (3 days of sick leave) 
  (2) Medical expenses12,028.0
  (3) Travelling expenses1,000.0
  (4) Purchase of nourishing food12,581.5
    26,617.5
   ======
 (ii)The Wife:$
  (1) Medical expenses22,232.0
  (2) Travelling expenses1,000.0
  (3) Purchase of medical equipment2,695.0
  (4) Purchase of nourishing food12,581.5
   38,508.5
   ======

The Evidence

7.  To decide on the issues, one has to rule on the facts of the case upon available evidence before the Court, including documentation and oral evidence from witnesses.  Without the question of authenticity, documents are generally more reliable than witnesses as the latter may elect not to tell the truth, exaggerate consciously or unconsciously, forget part of the facts as memory fades out as time goes on.

8.  In the present proceedings, both documents and live witnesses were available.  There was no argument that any of the documents was fabricated or untrue.  There were however lots of arguments that the witnesses were not to be believed.  Upon thought, it is my general observation that:

(a)  written documents are preferred to if there is a conflict between them and witnesses, and

(b) the Plaintiffs’ evidence are preferred to if there is a conflict between them and those of the Defendants.

9.  I say so for the following reasons.

10.  The evidence of the 1st Defendant is important because he was the driver of the coach.  “How did the accident happen?” and “Were there safety belts on the coach?” are two key factual disputes herein.  However, he failed me in a number of aspects.

(a)  The 1st Defendant tried to suggest that the accident was caused by other drivers.  He said that a truck in front of him stopped suddenly, forcing him to brake and swerve to the right to avoid a collision.  He successfully did so, but it happened that there was another heavy vehicle being “stationary” on the road blocking him.  In the words of his Counsel, it was an inevitable accident.

(b) Such suggestion is contradictory to contemporaneous documents. 

(i) The 1st Defendant was held wholly responsible for the accident:

“…蔡發現與前方同車道車輛距離過近,即往右打方向變入右邊主車道後,甲車車頭碰撞同車道前方由湖北省蒲圻市官塘驛鎮振興街87號的駕駛員徐輝鵬駕駛粵A•B3527號重型半挂牽引車(乙車)車尾,造成甲車駕駛員蔡明生、甲車乘客馮金英、曾人聰、曹金燕、鄧美華、姚杏萍、莫玉清七人受傷及甲、乙車兩車不同程度損壞的交通事故。

經我大隊調查後認為,駕駛員蔡明生駕車過程中沒有按照操作規範安全駕駛,其行為違反《中華人民共和國道路交通安全法》第二十二條第一款之規定;根據《交通事故處理程序規定》第四十五條第一款第一項之規定,駕駛員蔡明生應負該事故的全部責任;駕駛員徐輝鵬,乘客馮金英、曾人聰、曹金燕、鄧美華、姚杏萍、莫玉清不負事故的責任。

以上事實有當事人蔡明生、徐輝鵬的供述及身份證明、現場圖、現場照片、現場勘查記錄、機動車檢驗報告、車輛痕跡檢驗記錄、醫院診斷證明等證據證實,事實清楚,證據確鑿。”

(交通事故認定書dated 12 August 2005)

(ii) Somebody entered into a settlement agreement for the 1st Defendant with the driver of the heavy vehicle and one passenger on the coach:

“各方當事人在了解國家有關賠償政策規定後,達成以下協議:

1. 粵Z•BH04港號車因事故的拖車費(憑票)、停車費(憑票)、修配費由粵Z•BH04港號大客車方自行負責。

2. 粵A•B3527號重型半挂牽引車因事故的拖車費(憑票)、停車費(憑票)、修配費:¥6330元、鍳定評 估費 :¥310元由粵Z•BH04港號 大客車方負責。

3.  粵A•B3527號重型半挂牽引車上貨物(麥芽糖漿)損失費:¥4980元,鍳定評估費:¥250元由粵Z•BH04港號大客車方負責。

4.  傷者莫玉清因事故受傷的醫療費(憑票)、交通費(憑票)由粵Z•BH04港號大客車方負責。

以上費用自調解之日一次性付清,雙方互不追究其它經濟賠償責任。”

      (交通事故調解書dated 11 September 2005)

There were some disputes over the exact identity of that “somebody”. However, in my view, for the present purpose, such question is not particularly relevant. On balance, the one who paid for the 1st Defendant had to be somebody who was responsible for the acts of him. The payment, without reservation, amounted to an admission of liability. 

(c)  The oral evidence of the 1st Defendant turned to be unreliable under the cross-examination of Mr. Lam.

(i) The 1st Defendant told the Court that he started to notice the truck when it was at a distance of about 100 metres from him.  Thereafter, before the swerving, it was about 20 metres.  It therefore suggests that the 1st Defendant was driving faster than the truck.

(ii) Within such period, he further told that there were some 10 to 20 small vehicles cutting the lanes in between.  He had to be alerted by the then traffic condition.

(iii) As pointed out by Mr. Lam,

“It is trite law and common sense that each and every driver has to keep a safe braking distance behind the vehicle immediately in front of it so that even if the driver of the vehicle in the front suddenly slowed down, the driver of the vehicle following it would have sufficient time to react to the situation. The duty is squarely upon D1 in the present situation.”

(para. 3(g) of Mr. Lam’s Final submission) (iv) As to the heavy vehicle, to start with, I cannot understand how it could be “stationary” on a highway. There is no single piece of evidence suggesting the same, apart from that of the 1st Defendant. However, even if it were “stationary” there:

“…  There is also no merits in D1’s allegation whatsoever because it was his duty to keep a safe braking distance behind the first vehicle (the truck), and part of the reasons for that was he would have been able to see the traffic condition on the right-hand-side lane, including the second vehicle.” 

     (para. 3(h) of Mr. Lam’s Final Submission)

(d) Ms. Tong suggested that the accident was inevitable as far as her client was involved.  She cited a number of authorities.  They however cannot help the 1st Defendant because the argument is a factual one and depends much on the particular circumstances of the case.

(e)  Regarding the safety belt issue, the 1st Defendant said that there was such facility, lap belt (安全腰帶), on the coach for the passengers. The Plaintiffs just failed to use them.  Nonetheless, the availability of the safety belts on the coach is not supported by any objective evidence, like photos or certificate of inspection.  Quite to the contrary, one would expect that such live and important issue had to be appeared somewhere in the documents concerning investigation of the accident in PRC and compensation for the victims whose claim was either settled or lodged there, but it did not appear anywhere in these documents.

(f)   The 1st Defendant also said that the coach was examined in Hong Kong every year, including checking that safety belts were provided at the passenger seats.  However, upon being put that the relevant Hong Kong legislation (viz. Regulation 8A(1) and (2) of the Road Traffic (Safety Equipment) Regulations, Cap 374F) did not require so, even at the date of the trial herein, not to mention years ago when the accident happened, the 1st Defendant was unable to give any further reply.

(g)  The 1st Defendant’s evidence in relation to the taking care of the safety belts every day is far from believable.  As pointed by Mr. Lam in paragraph 8(h) of his Final Submission,

“… while he was driving the coach in 2003-2005, before he went off duty everyday, he would adjust all the safety belts on the 45 passengers seat of the coach to the shortest length and buckle up all the safety belts so that all the safety belts would rest neatly and tidily close to the gap of the vertical back and the horizontal seat of the passengers seat.  With the greatest respect, this allegation is nothing but false. There is absolutely no reason, not to mention no good reason, for D1 to buckle up the safety belts knowing full well that the passengers coming on board the next journey would have to unbuckle the safety belt before they could buckle up.  No driver would have done what D1 alleged to have done.  It is clear that D1 made up the allegation with a view to beefing up his case that there were safety belts provided for the passengers seat of the coach …”

11.  The evidence of the director of the 2nd Defendant, Mr. Chen, is also important for the purpose of determining the exact relationship among the parties, in particular that between the Plaintiffs and the 2nd Defendant. Unfortunately, I also find him unreliable.

(a)  The 2nd Defendant pleaded that it only sold the tickets as the agent of 奔力冠一.  The staff at the counter would inform all customers as such.

(b)  However, no staff was called to give evidence to such effect. 

(c)  The 2nd Defendant usually sold tickets for buses they managed.  Mr. Chen told the Court that it had started selling tickets for 奔力冠一from 17 September 2004.  Before the accident, they did not encounter any problem.  After the same, they added something on the tickets to the effect that they were selling the same as agent only.

(d)  Without commenting whether the new practice could help the 2nd Defendant avoiding its liability in future, such change simply makes clear that the 2nd Defendant did not realize the importance of the difference between selling their own tickets and selling tickets for others.  As such, it also makes the oral representation by all counter staff to customers not to be believed.

12.  Having decided that the Plaintiffs’ case is more credible in considering the overall oral evidence before me, I cannot accept all of their factual propositions as some of them were either untrue or unreliable in light of the documents.

(a) Both Plaintiffs maintained that the tickets did not contain any ticket end (票尾), but it cannot be true as both vertical edges of the original tickets produced by them (exhibit P2 to P4) clearly bear “dots”.  It means that each ticket contains 3 parts: the ticket stub (票頭), the ticket itself (票身) and the ticket end (票尾).

(b) The Plaintiffs disclosed not only 3 original tickets, but also a copy of the back sheet of another ticket being stuck with a round label containing: printed words of “冠一巴士” and hand written numbers of “7422”.  The Plaintiffs could not come up with any explanation of the document but admitted that it was produced by them.  With respect, it must be something coming into their hands or possession of any of their family members out of the subject trip.

(c) With the above copy label in hand and coupled with the photos of the coach as shown in the investigation by the PRC traffic police (showing the name of 廣東奔力冠一旅遊客運有限公司 on the side of the coach), it makes one hard to agree that the Plaintiffs were entirely unaware of “冠一巴士”; “奔力冠一” or “廣東奔力冠一旅遊客運有限公司” at all. One of course must accept that all passengers had to get off and board the coach 3 to 4 times throughout the journey at the Hong Kong Immigration and PRC Immigration. The labels were provided to the passengers to help them identifying the “correct” coach to get on.

13.  Upon consideration, I make the following finding of facts:

(a) The 1st Defendant failed to keep a safe distance between his coach and the truck ahead.  When the truck slowed down, the 1st Defendant had to swerve to the right lane to avoid a direct collision and as such, it rammed into the heavy vehicle.

(b) After the accident, the Plaintiffs were sent to the local hospital there, receiving simple and initial treatment.  It was late at night.  They wanted better treatment in Hong Kong.  They also wanted to take their mother and children back to Hong Kong.

(c) The Mainland traffic police told them that they had to stay if they wanted to claim in PRC.  The family was desperate to leave for Hong Kong.  They did not have legal advice.  The Plaintiffs’ injuries were relatively less serious than others, in the sense that they were still conscious and could walk themselves. They, together with other passengers in similar situation, signed the document to the police there headed “申請書”.

“本家庭方國權、余豔薇、方月衡、方中正於2005年7月24日乘坐粵Z•BH04港號大客車,途經廣深高速公路東莞路段時發生交通事故,事故後一家人進醫院檢查,經檢查後,無大礙。現向交警部門申請不立案處理,所有費用均由我們自行負責,不需要責任方賠償,不需交警出示證明材料。

 申請書
 

方國權、余豔薇、
方月衡、方中正”

The Plaintiffs did not make any other intimation to the police apart from the above document.  However, the Husband was barely aware of their right or possibility of claiming damages as, after all, they were injured.  He therefore asked some one to help him writing down his position and asked the “responsible person”, i.e. the one who represented the coach and came to take them back to Hong Kong.

“道路交通事故筆錄紙

我們是香港人:姓名:方國權,男43歲,方中正,男9歲,方月衡,女11歲,余艷薇,女43歲,何麗華,女73歲。

我們在2005年7月24日下午15時,由廣州乘坐威盛直通巴士有限公司安排廣東奔力冠一旅遊客運公司,車牌號Z•BH04港大客車回香港,途中在廣深高速東莞路段發生交通事故,造成上述人員有不同程度的身體傷病。交通事故發生後,我們由虎門交警高速大隊負責送到東莞市虎門醫院附屬虎門創傷急救中心診治。但我們在醫院裏得不到積極之診治,現要求轉院回香港診治,現責任方威盛直通巴有限公司廣東奔力冠一旅遊客運公司負責人已同意我們的請求,同意我們回香港診治,直至我們的身體恢復健康才結案。同時在今次事故中之醫療費、誤認費、補償費、按香港機關法律條例進行賠償。上述協議請求交警部門進行監督作證。

甲方(傷者)簽名確認:

乙方威盛直通巴士有限公司
負責人簽名確認:
余艷薇   方國權
方月衡   方中正
何麗華
蔡柱財
9485 9720

(d) The 2nd Defendant sold coach tickets for 奔力冠一, as evidenced by their Agreement (代售班車票協議書) dated 27 September 2004.

(e)  Notwithstanding such agency relationship, it was not made known to the Plaintiffs at all material times.  They bought their tickets from the counter of the 2nd Defendant under its name of “威盛直通巴士有限公司”.  It was also the only name appearing on their tickets.  The counter staff did not tell them that the 2nd Defendant only sold the tickets for and on behalf of 奔力冠一.

Legal Principles

14.  With the above facts findings, they can resolve most of the disputes of facts among the parties.  Before approaching to answer the issues identified hereinabove, as far as they are relevant, I also set out the following applicable legal principles.

(a)  Inevitable accident is:

“…where a person does an act, which he lawfully may do, but causes damages, despite there having been neither negligence nor intention on his part.  …  However, it has been doubted whether much advantage is gained by the continued use of the expression “inevitable accident”.  To quote the words of Lord Greene.

“I do not feel myself assisted by considering the meaning of the phrase ‘inevitable accident’.  I prefer to put the problem in a more simple way, namely has it been established that the driver of the car was guilty of negligence?”…”

(Charlesworth & Perey on Negligence, 10th ed. at P. 218)

(b) (i) Waiver in the context of contract is:

“… where one party voluntarily accedes to a request by the other that he should forbear to insist on the mode of performance fixed by the contract, the court may hold that he has waived his right to require that the contract be performed in this respect according to its original tenor.  Waiver (in the sense of “waiver by estoppel” rather than “waiver by election” may also be held to have occurred if, without any request, one party represents to the other that he will forbear to enforce or rely on a term of the contract to be performed or observed by the other party, and the other party acts in reliance on that representation.

 (Chitty on Contracts, Vol. 1, 13th ed. at p. 1469-1470)

          Mr. Lam added, and I agreed that:

“… two pre-requisites must be satisfied – (i) the waiver must be clear and unequivocal, and (ii) D2 must have altered its position in reliance on the waiver, or at least acted on it.” 

(para. 22 of Mr. Lam’s Final Submission)

It should also be noted that:

“… the word “waiver” is used in the law in a variety of different senses and so bears “different meanings”.  Two types of waiver are relevant here.  The first type may be called “waiver by election” and waiver is here used to signify the “abandonment of a right which arises by virtue of a party making an election”.  Thus it arises when a person is entitled to alternative rights inconsistent with one another and that person acts in a manner which is consistent only with his having chosen to rely on one of them…  It is important to appreciate that, in this context, the party who makes the election only abandons his right to treat the contract as repudiated: he does not abandon his right to claim damages for the loss suffered as a result of the breach.  A second type of waiver may be called “waiver by estoppel” and it arises when the innocent party agrees with the party in default that he will not exercise his right to treat the contract as repudiated or so conducts himself as to lead the party in default to believe that he will not exercise that right …”

(Chitty on Contracts, Vol. 1 13th ed. at p.1543-1544) 

(ii) Waiver in the context of tort:

“Wavier by an election inconsistent with a tort claim.  By contrast a tort is discharged when the claimant chooses a right that is inconsistent with complaining about the tort.  In Lord Atkin’s words in United Australia Ltd v Barclays Bank Ltd, “it is essential to bear in mind the distinction between choosing one of two alternative remedies, and choosing one of two inconsistent rights … if a man is entitled to one of two inconsistent rights it is fitting that when with full knowledge he has done an unequivocal act showing that he has chosen the one he cannot afterwards pursue the other, which after the first choice is by reason of the inconsistency no longer his to choose”. 

(Clerk & Lindsell on Torts, 19th ed. p. 1952)

(c) Promissory estoppel, in the words of Ms. Tong:

“The elements to be satisfied to find promissory estoppel are as follows: (1) a clear and unequivocal promise which is intended to be binding, (2) where there is an existing legal relationship between the parties, (3) which was acted on in reliance (4) to the detriment of the other party.” 

(para. 123 of Ms Tong’s final submission)

(d) Mr. Lam kindly agreed that the Plaintiffs could not sue the 2nd Defendant on contract if they at the material time knew that the 2nd Defendant was only agent for 奔力冠一.

(e) Ms. Lau also kindly agreed that the 2nd Defendant could be held liable under contract if the Plaintiffs at the material time did not know that the 2nd Defendant was only agent for 奔力冠一.

(f) There must be an implied term of safety under the ticket to carry all passengers, including the Plaintiffs with reasonable care for the journey.

(g) The Privy Counsel decision Wong Mee Wan v Kwan Kin Travel Services Ltd & Others [1995] 3 HKC 505 is the leading authority confirming that Hong Kong tour operator can be held liable for negligence of its independent contractor.  It was held that:

“(1) The fact that the supplier of services may under the contract arrange for some or all of them to be performed by others did not absolve the supplier from his contractual obligation.  He may be liable if the service was performed without the exercise of due care and skill on the part of the sub-contractor just as he would be liable if the sub-contractor failed to provide the service or failed to provide it in accordance with the terms of the contract.  British Wagon Co v Lea (1880) 5 QBD 149 applied (at 510C-D).

(2)  A distinction had to be drawn between cases where the party agreed merely as agent to arrange for services to be provided and where he undertook to supply the services.  The fact that it was known that another person would or might perform the services or part of them did not mean that the contract was one of agency.  In each case it had to be asked as a matter of construction into which category the contract fell.  Craven v Strand Holidays (Canada) Ltd (1982) 40 OR (2d) 186 applied (at 510E-I).

(5)  Taking the contract as a whole, the first defendant had undertaken to provide and not merely to arrange all the services included in the programme, even if some activities were to be carried out by others.  The first defendant’s obligation under the contract that services would be provided with reasonable skill and care remained even if some of the services were to be rendered by others, and even if tortuous liability may exist on the part of those others (at 515A-C).

(6)  It was an implied term of the contract that reasonable skill and care would be used in rendering the services to be provided under the contract.  The trip across the lake was clearly not carried out with reasonable skill and care in that no steps were taken to see that the driver of the speedboat was of reasonable competence and experience and the first defendant was liable for such breach of contract (at 515C-E).

(7)  …”

(h) The facts of Foulkes v The Metropolitan District Railway Company [1879] 4 CPD 267 closely resemble the present case.  In the authority, the Plaintiff bought his ticket from A Company.  On his return trip, he boarded the train provided by Company B.  The Plaintiff chose to sue the carrier.  He won the case.  Nonetheless, as observed by Lords J.:

“… the plaintiff might have two remedies, one against the defendant company on their implied contract or undertaking (I do not think it much matters whether we call it a contract or an undertaking, especially after the cases of Marshall v York, Newcastle, and Berwick Ry. Co n(1), and Austin v Great Western Ry. Co n(2)), the other remedy against the South Western Company who issued the ticket.  I cannot see any difficulty in that.  Take this illustration: railway A issues tickets for railway A and railway B.  The traffic is sometimes worked by carriages and servants belonging to railway A, and sometimes by carriages and servants belonging to railway B.  A passenger takes a ticket from railway A and gets into a carriage belonging to railway B, drawn by railway B’s engines, and manned by railway B’s servants.  The passenger traverses some portion of railway B’s line, an accident is caused by the negligence of railway B’s servants, and through some defect in railway B’s carriages not being properly adapted to the exigencies of the traffic.  Now, although not necessary perhaps, to go that length for the decision of this case, I think that, according to the authorities, the passenger could sue either railway A or railway B.  He could sue railway A on the contract arising from the ticket issued by the company to carry him the whole distance with reasonable care or caution, or he could sue railway B as the immediate authors of the negligence, on the implied contract or undertaking which would arise from his having been received into the carriage, or from his having been invited to go into the carriage of railway B and become a passenger on the railway.”

(i) Service provider may attract liability under the concept of holding out.  In Rogers v Night Riders (a firm) and others [1983] RTR 324:

“Held, allowing the appeal, that, on the facts, the defendants had held themselves out to the general public as a car-hire firm undertaking to provide a vehicle to convey the plaintiff to her destination; that the defendants could foresee that the plaintiff might be injured if the vehicle provided for her was defective and, accordingly, they owed the plaintiff a duty to take reasonable steps to ensure that the vehicle so provided was properly maintained and reasonably fit for that purpose (p. 328 H-L); and that the duty could not be delegated by the defendants to a third party, such as the driver, whether an employee or an independent contractor, so as to evade responsibility for breach of that duty.”

Answers to the Issues

15.  I now apply the above principles to the facts found by me and answer the issues:

(1) The accident was solely caused by the negligence of the 1st Defendant. He failed to keep a proper distance with the truck in front.  He also failed to pay proper attention to the heavy vehicle.  The accident was not an inevitable one.

(2) The Plaintiffs did suffer injuries at the accident.

(3) The Plaintiffs are not estopped from bringing proceedings against both Defendants in Hong Kong.  “申請書” has to be understood in light of the circumstances they signed, together with “道路交通事故筆錄紙”.  There is no clear and unequivocal statement made by the Plaintiffs to let go both Defendants in Hong Kong.  Quite to the contrary, they did reserve their position.

(4) The 2nd Defendant was agent for selling tickets for its principal 奔力冠一.

(5) Such agency relationship was not known to the Plaintiffs. Hence, the 2nd Defendant was still their contracting party in the eyes of the Court.  The contract contained an implied term of safety.  The 2nd Defendant breached it as the 1st Defendant had been held negligent in the accident under the principle of Wong Mee Wan.

(6) As an alternative, the 2nd Defendant did owe a duty of care in tort under the principles as stated in the said authority of Foulkes and Night Riders.  Such duty was also breached as a result of the negligence of the 1st Defendant.

(7) The 2nd Defendant was vicariously liable for the negligence of the 1st Defendant.

(8) There were no safety belts available to the passengers on the coach.  The Plaintiffs were not contributory negligent to their injuries suffered.

16.  Having determined the liability against both Defendants, I now turn to the assessment.

The injuries

17.  Upon return to Hong Kong, the Plaintiffs immediately went to the A&E Department of North District Hospital at about 1:30 a.m. on 25 July 2005.  From the reports, the Husband suffered:

“1cm laceration (already sutered) over right supraorbital region, no conjunctival haemorrhage bruised left forehead, loosened teeth, right knee abrasion with mild effusion, tenderness over medical aspect, range of movement decreased probably due to pain, X-rays of his skull, right orbit and right knee showed no fracture.

The provisional diagnosis was head and right knee injuries in road traffic accident.

The following treatment were given, intramuscular tramadol injection for immediate pain relief dologesic, triact, hirudoid cream.” 

(Report dated 11 August 2008)

And, the Wife:

“Abrasion was noted at left face.  Bruises were noted at both knee.  The range of movement of shoulders were normal. X-ray of facial bone and both knee showed no fracture.

The provisional diagnosis was multiple injuries.

The following treatment was given – analgesics.” 

(Reported dated 11 August 2008)

18.  The Wife’s neck pain was further recorded in a physiotherapy report prepared by Caritas Medical Centre dated 19 November 2005:

“…  During the initial visit, this patient presented with deep stretching pain over neck and left shoulder especially on right neck rotation and left shoulder elevation.  The treatment she received were intermittent neck traction, hot pack, neck and thoracic mobilization and stretching exercise.  Up till 17/11/2005, she has received 7 sessions of physiotherapy treatment.  Objectively, range of motion (ROM) of neck flexion and extension was full but with blocking pain on end range of neck extension.  For neck side flexion, right side was ¼ ROM and left side was ½ ROM with pain elicited.  For neck rotation, left side ROM was full but right side was 2/3 ROM with pain elicited.  On palpation, muscle spasm was found and stiffness over upper thoracic spine.”

19.  Finally, the Plaintiffs and the 2nd Defendant did also arrange for joint reports from orthopaedic expert Dr. Henry Lo.  The Husband was said:

“Diagnosis

Mr. Fang sustained the following injuries:

1. Right peri-orbital skin laceration

2. Right knee soft tissue contusion

3. Traumatic loss of teeth

…

Treatment

The laceration was sutured and has healed uneventfully without residual symptoms or obvious cosmetic deformity.  The right knee contusion has healed up completely without specific treatment.  The right lower limb balance is slightly impaired compare lower limb as demonstrated by the right leg being less stable during single.  However, overall, the recovery is excellent.  He can squat fully and there is right knee.  The dental trauma resulted in loss of more than half his teeth and he needs to use a denture to help him speak and eat.  His speech is easily comprehensible.

Prognosis

The prognosis of his dental injuries should be assessed by a dental surgeon.  In terms of his right knee and right peri-orbital facial injuries, the prognosis is excellent.  No long-term complication is expected in these areas.

Employability

He is fully able to continue his work as a warehouse manager and perform all the lifting tasks as before.  He claims that his speech is slightly affected when he is talking on the telephone at work but I did not find him difficult to understand.  His speech is not slurred.

…

Whole person impairment and loss of earning capacity

From an orthopaedic perspective, he has not suffered any whole person impairment or loss of earning capacity.”

On the other hand, the Wife:

“Diagnosis

Madam Yu sustained a strain injury of the muscles of the neck and shoulders, namely the trapezius muscles and a strain of the midline cervical ligaments namely the superior nuchal ligament, and interspinous ligaments.  She also has radiological evidence of degeneration of the cervical spine which is unrelated to the accident.  The MRI findings of mild disc prolapses from C3/4, C4/5, C5/6 and C6/7 levels are part of the natural degenerative process and not caused by the accident.  Her present symptoms are related to the soft tissues as mentioned and are not likely to be caused by the degenerative changes, which are quite common even in people without neck symptoms.  She has pain during movement of the neck and the range is slightly reduced.

She also suffered minor abrasions to her face and both knees, which have all resolved uneventfully. 

…

Treatment

The soft tissue injuries of the neck were treated by physiotherapy.  This was standard and appropriate treatment.  For her future treatment, she should be observed of her posture and avoid prolonged forward bending (looking down) or extension (looking up) of her neck and stretch her neck muscles and change her head and neck position regularly.  This would reduce the frequency of neck discomfort.  She may benefit from short courses (around six sessions) of physiotherapy to alleviate her neck symptoms on an as required basis.  Surgery is not required.

Prognosis

The prognosis of her neck injury is good provided she observes her head and neck posture.  She has recovered well from her injury and at present she does not need to take painkillers.  She can manage house chores and shop for groceries and she is independent in her activities of daily living.

…

Employability

She is fully able to continue working as a warehouse manager but she may experience mild neck discomfort if she has to lift and carry heavy rolls of fabric repetitively but this should settle with rest and self-stretching exercise.

Whole person impairment and loss of earning capacity

From an orthopaedic perspective, she has suffered approximately 1% whole person impairment and 1% loss of earning capacity.

PSLA

20.  Counsel referred to me and commented on a number of authorities.  I find So Sau Man v Leung Ming Kwong and Another (DCPI 376/2005, 18 October 2005, unreported) a good starting point for the Husband’s injury.  In that case, a right lip laceration lost of 3 teeth justified $100,000 PSLA.  The Husband asked $200,000 for, among others, loss of 5 teeth instantly and losing of a further 10 later. His claim must be allowed in full.

21.  On the other hand, Muhammad Saddiq v Cheung Chi Keung (HCPI 1018/2006, 8 April 2008, unreported) is a better comparable to the Wife’s case, save that she, among other minor injuries, suffered only a whiplash to the neck, but not a sprained back.  I will grant her also $200,000.

Cost of part-time domestic helper

22.  The engagement of domestic helper must be reasonable in light of the injuries of the Plaintiffs.  However, how far should they go?  After all, she had 79 days of sick leave and Dr. Ho only agreed a period of 8 weeks sick leave was reasonable to the Wife.  Upon thought, I take the view that the assistance of a part-time domestic helper for 1 year is reasonable in the circumstances, and hence will allow the sum of $27,000 ($50 x 45 hours x 12 months).  Hence, $13,500 will be awarded to the Husband and the Wife individually.

Pre-trial loss of earnings and MPF for the Wife

23.  The Husband and the Wife worked together.  The former was the manager and the latter, the director.  The Husband only claimed 3 days of loss of earnings for $1,008 as he only took 3 days sick leave.  However, the Wife had a total of 79 days of sick leave certificate.  She therefore had a bigger claim of $45,622.50 ($16,500 x 79/30 + 5% MPF).  Further, she said that thereafter she easily lost her attention, made mistakes at work easily and could not carry out some manual work requiring strength.  As a result, her elder brother, the other director of the employer, decided a salary deduction.  She had no choice but to accept it as she did perform “worse” than before.  She asked for a further sum of $137,025 ($16,500 - $12,000 x 29 months + 5% MPF).  The Defendants disagreed and challenged the claim.  However, the Wife’s case is well supported by IRD documents and I also find her generally a credible witness, her claim under this head is allowed without deduction.

Costs of future medical expenses by the Husband

24.  When Mr. Lam started his clients’ case in the opening, he asked for a new head of damages for the Husband, namely $85,000 for replacement and re-fixing of the dentures from time to time, say a total of 10 times ($8,000 - $9,000/time x 10 times).  Upon careful consideration, I take the view that it is not to be allowed, both as a matter of pleadings and on facts.

(a)  It is trite law that a party is “bound” by his pleadings.  He cannot go beyond the case he pleaded.  (Amended) Statement of damages is part of the pleadings herein and I cannot locate any reference of the claim for future medical expenses by the Husband.

(b) There is no proper medical evidence before me from any dental surgeon to explain the expenses.

(c)  The witness statement of the Husband did not contain any reference of such expenses. Although he did “supplement” it when he was in the witness box, only little weight should be given to it.

Summary

25.  In conclusion, I will allow the followings to the Plaintiffs against both of the Defendants.

 (a)  The Husband: 
   $
  (i) Damages for PSLA200,000.0
  (ii) Pre-trial loss of earnings1,008.0
  (3 days of sick leave) 
  (iii) Medical expense12,028.0
  (iv) Travelling expenses1,000.0
  (v) Purchase of nourishing food12,581.5
  (vi) Costs of hiring part-time domestic helper13,500.0
   240,117.5
   =========
 (b) The Wife:$
  (i) Damages for PSLA 200,000.0
  (ii) Pre-trial loss of earnings and MPF182,647.5
  (iii) Medical expense22,232.0
  (iv) Travelling expenses1,000.0
  (v) Purchase of medical equipment2,695.0
  (vi) Purchase of nourishing food 12,581.5
  (vii)  Costs of hiring part-time domestic helper13,500.0
   434,656.0
    ========
    

Interest and costs

26.  Regarding interest, the Plaintiffs are entitled to interest at 2% per annum from the date of writ to the date hereof on PSLA, pre-trial loss of earnings and MPF.  As to other damages, interests are to be calculated at half of the judgment rate from the date of the accident to the date hereof.

27.  There is also an order nisi that both Defendants shall pay cost of the Plaintiffs for the whole proceedings, including Certificate for Counsel for the hearings before me, to be taxed, if not agreed.

   (Jack Wong)
  Deputy District Court Judge

Mr. A. Lam instructed by Messrs. S.H Chan & Co. for the Plaintiff

Miss C. Tong instructed by Messrs. Ho, Tse, Wai & Partners for the 1st Defendant.

Miss L. Lau instructed by Messrs. H.L. Wong & Co. for the 2nd Defendant.

67236-EN-2009-08-27

FANG GUO QUAN AND ANOTHER v. CHOI MING SANG AND ANOTHER

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DCPI 1468/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

PERSONAL INJURIES ACTION NO. 1468 OF 2008

------------------------

BETWEEN

 FANG GUO QUAN and YU YAN WEIPlaintiffs
 and 
 CHOI MING SANG1stDefendant
 WEISHENG BUS LIMITED2nd Defendant

------------------------

Coram: Deputy District Judge Raymond Tsui in chambers (open to the public)

Date of Hearing:   17th August 2009

Date of Handing Down Decision:   27th August 2009

------------------------

DECISION

------------------------

 

Background

1.   There was a traffic accident on 24th July 2005 in China involving a coach driven by the 1st Defendant. The Plaintiffs were among the passengers on board and sustained injuries. The Plaintiffs purchased the tickets for the coach from the 2nd Defendant at a sales outlet in Hong Kong. There is no dispute that all the parties to this action are Hong Kong residents and company incorporated in Hong Kong.

2.   The Plaintiff commenced the present action for damages for injuries sustained in the said traffic accident against both Defendants. The causes of action relied on by the Plaintiffs are both contractual, being based on the coach tickets purchased from the 2nd Defendant and tortious, being based on the duty of care owed by the 1st Defendant to the Plaintiffs.

3.   The 2nd Defendant took out a summons dated 17th December 2008 for stay of proceedings on the ground of forum non conveniens. At a hearing on 22nd December 2008 before Registrar Poon, an application was made by the 2nd Defendant for filing an affirmation to exhibit expert evidence on the PRC law. The application was refused.

4.   The substantive hearing took place before me on 24th April 2009. At the hearing, the 2nd Defendant asked for an adjournment for the purpose of filing evidence on PRC law. The application for adjournment was refused. In a judgement handed down on 4th June 2009, the summons was also dismissed. I would not recite the facts of this case which have been sufficiently set out in the said judgement.

5.   The 2nd Defendant took out the present summons on 2nd July 2009 (the “Appeal Summons”) for leave to appeal against my decision and hence today’s hearing.

6.   The 2nd Defendant filed a second affirmation of Mr Chen Weiping (the “Affirmation”) on 14th of August 2009. Before today’s hearing, the 2nd Defendant produced to the court a copy of a Legal Opinion of a PRC lawyer (the “Opinion”).

7.   The Affirmation seeks to clarify the relationship of the various parties involved in the provision of the coach service purchased by the Plaintiffs which was wrongly presented to the court at the hearing on 24th April 2009. Exhibited to the Affirmation are the coach tickets purchased by the Plaintiffs with the conditions printed on the overleaf. Also exhibited to the Affirmation is an agreement between the 2nd Defendant and a joint venture company in China whereby the 2nd Defendant agreed to sell coach tickets for the joint venture company. There is also an insurance policy exhibited to the Affirmation which in fact has been produced in the 1st Affirmation of Mr Chen Weiping. As to the Opinion, which is not exhibited to any affirmation, it sets out the law relating to the issues of liability and insurance in the PRC in respect of traffic accident. Mr Lam, counsel for the Plaintiffs, objected to the admission of the Affirmation and the Opinion.

8.   Instead of spending time to argue whether the Affirmation and the Opinion should be admitted, I decided to consider them de bene esse.

The Law

9.   The applicable principles in respect of application for leave to appeal are well settled. (SeeMa Bik Yung v Ko Chuen HCMP No. 4303/1999; Bowardley Enterprises Limited v Millennium Group Limited DCCJ No. 3039/2004; Wu Yi Development Company Limited v Big Island Construction (HK) Limited DCCJ No. 5174/2005) Put simply, the court will only refuse leave if there is no realistic prospect of success.

Preliminary issue --- Final or Interlocutory

10.   The Appeal Summons was filed on 2nd July 2009 which was the 28th day from the date of my order dismissing the application of the 2nd Defendant. According to Order 58 rule 2(4), if my order is a final order, the time limit for appeal would be 28 days. If it is an interlocutory order, the time limit for appeal would be 14 days and the filing of the Appeal Summons was out of time. There was thus the preliminary issue as to whether my order was final or an interlocutory.

11.   Chan PJ observed in Shell Hong Kong Ltd v Yeung Wai Man Kiu Yip Co Ltd (2003) 6 HKCFAR 222, 232F-I as follows:

“31. In my view, what one can extract from these cases is that where an order or judgement given in an application does not finally dispose of the whole action but only an issue in the action, it is necessary to consider the purpose and substance of the application, the issue dealt with and determined by the court and the effect of a determination of this issue on the rights of the parties, the further conduct of the proceeding and the final disposal of the whole action. A broad commonsense approach should be adopted. If the issue dealt with and determined by the court is ‘a sustentative part of the final trial’ … or ‘a crucial issue’ in the case or a point ‘that goes to the root of the final trial’ …, or ‘a dominant feature of the case’ …, then the order or judgement, even if it does not finally dispose of the whole action, should nevertheless be regarded as a final judgement.”

12.   Applying Shell Hong Kong Ltd to the present case which is an application for stay of the whole action on the ground of forum non conveniens and adopting a broad commonsense approach, I agree that the application relates to a very crucial issue in the case. A successful application by the 2nd Defendant would effectively put an end to the present action. I also draw support from the comment of Fuad VP in First Pacific Bank Ltd v Robert HP Fung [1990] 1 HKLR 527, 532A-B. As such, I am of the view that my order is a final order. Thus the filing of the Appeal Summons was within time.

13.   In the present case, the 2nd Defendant has not drafted any Notice of Appeal for the court’s consideration. Mr Cheung, counsel for the 2nd Defendant, relied on his Skeleton Submission which was only filed on the 14th August 2009. He argued that the court should have admitted the Opinion pursuant to Order 32 rule 16A(4) which would help the court to grapple with the issues involved, particularly the issue of choice of law. He also submitted that the Opinion would shed more light on the latest development of the law relating to quantum in the PRC.

14.   The main thrust of Mr Cheung’s submission is that the court should have all relevant materials before it before a decision is made. At the end, the court may, after a weighing exercise, decline to accept the Opinion. But the court should not exclude itself from considering it. Heavy reliance was placed by Mr Cheung on Vernon v Bosley (The Times 8 April 1994). Vernon is a case on whether a certain line of cross-examination should be allowed at a trial. Hoffman LJ was of the view that “although a judge has no discretion to exclude admissible evidence, his ruling on admissibility may involve a balancing of the degree of relevance of the evidence against other considerations which is in practice indistinguishable from the exercise of a discretion. It is in my view essential, if judges are to be able to keep the length of trials within bounds and conduct the proceedings with due sensitivity to the interests of third parties and the wider public interest, that they should have the same latitude in deciding how the balance should be struck as this court would accord to the exercise of a discretion.”

15.   I do not think Vernon could help the case of the 2nd Defendant. We are dealing with a situation quite different from that of Vernon. In Vernon, the court had to deal with the exercise of a discretion to determine whether certain evidence should be admitted. In our case, before the issue of discretion of allowing the Opinion to be admitted is considered, the 2nd Defendant first faces a procedural hurdle, namely, it should have lodged an appeal against the decision of Registrar Poon. There was no argument mounted by Mr Cheung against the application of the case Jindal Exports Ltd v Waco Trading Co Ltd [2000] 2 HKC 46, save that it was pointed that there was no mention in Jindal Exports Ltd as to the evidence sought to be adduced and that in the present case Chinese law was so important that the Opinion should be allowed. I do not think because of the importance of the evidence sought to be adduced, the procedural rules could be disregarded.

16.   As to the issue of the discretion of allowing certain evidence, as observed by Hoffman LJ in Vernon, the “cardinal principle of admissibility is relevance”. Applying the same principle to our case, if the applicable law is Hong Kong law, I do not see the relevance of the PRC law. To that extent, the Opinion is irrelevant.

17.   As to choice of law, Mr Cheung submitted that Boys v Chaplin [1971] AC 356 was different from the present case as there was no issue of choice of jurisdiction in that case. Be that as it may, I do not see how that would affect the issue of choice of law.

18.   As to choice of jurisdiction, he urged me consider that there was the joint venture company involved, that there was the insurance policy covering accidents in the PRC and that the accident happened in the PRC. Coupling these factors with the fact that quantum recoverable was on the same par with that awarded by the Hong Kong Court, the proper forum should be the PRC court.

19.   It seems that Mr Cheung was trying to rely on the new evidence in the Affirmation to argue that it was the joint venture company, which is a PRC company, who owned the coach, provided the service and took out the insurance but not the 2nd Defendant who was only an agent for the sale of the coach tickets. I think this does not help the 2nd Defendant’s case as the joint venture company is not a party to the present action.

20.   As to quantum, Mr Cheung submitted that even though the maximum amount recoverable under the insurance policy was RMB 100,000, this was not the maximum amount recoverable under the PRC law.

21.   As to the application of Order 32 rule 16A(4), Mr Cheung emphasized again that the Opinion was essential and relevant. No exceptional circumstances had been pointed out to me.

22.   Mr Lam commented that the Opinion made no reference to the contractual claim of the Plaintiffs or the choice of law of that claim. Since the coach tickets were sold in Hong Kong, the choice of law must be Hong Kong law. Since it is pleaded by the 2nd Defendant in its Defence, which was filed without prejudice to its right to prosecute the present appeal, that the joint venture company was an undisclosed principal of the 2nd Defendant when the coach tickets were sold to the Plaintiffs, the 2nd Defendant would be liable according to the general agency principles in Hong Kong. The Opinion had failed to explain whether the same principles applied in the PRC. If the said general agency principles did not apply in the PRC, there was no point for the parties to litigate the contractual claim in the PRC.

23.   Mr Lam pointed out that the Opinion identified three classes of persons who would be held liable in a traffic accident, namely, “the owner of the vehicle, the person who had control over the vehicle (車輛實際支配人) and the driver of the vehicle”. The meaning of車輛實際支配人 is not defined or explained in the Opinion. It is not known whether under the PRC law, the 2nd Defendant is regarded as a車輛實際支配人.

24.   Mr Lam submitted that according to the Opinion, determination of liability would be based on the Traffic Incident Confirmation (交通事故認定書). But the Traffic Incident Confirmation had never identified the 2nd Defendant as a liable party or as a 車輛實際支配人. Thus applying the Opinion to the present case, the 2nd Defendant would not be liable.

25.   In fact, the Opinion had never stated in the conclusion that the Plaintiffs could sue the 2nd Defendant in the PRC.

26.   Mr Lam also drew my attention to the PRC insurance policy which was taken out by the joint venture company in China. He pointed out that as far as the passenger liability was concerned, the party who could claim under the said insurance was the joint venture company but not the 2nd Defendant. Thus any action against the 2nd Defendant in the PRC would not have the benefit of receiving any compensation under the PRC insurance policy.

27.   No doubt the fact that the Plaintiffs may not have a valid claim against the 2nd Defendant in the PRC is a juridical disadvantage to them that may weigh against the PRC court as a more suitable forum in the balancing exercise.

28.   Mr Lam further pointed out that even though the Opinion had stated that there were cases where the awards for injuries were over RMB 1 million, there was a lack of particulars as to for what injuries those awards were granted. The Opinion was silent as to how much the Plaintiffs could be awarded in the PRC court. I agree. The least the Opinion should have done is set out the items of compensation that could be obtained by the Plaintiffs in the PRC court by reference to the available documents, including the Statement of Claim, the Statement of Damages and the medical reports of the Plaintiffs.

29.   Mr Cheung argued that what was important was that there was in fact no limit to the quantum of the award. That is beside the point. The point, I believe, is even if the Opinion were admitted into evidence, there would still be no evidence as to how much the Plaintiffs would be awarded as damages by the PRC court. Why should the Plaintiffs make their claims in the PRC when they have no idea how much they would possibly obtain from the PRC court? Those cases where the victims had been awarded substantial amounts of damages mean nothing to the Plaintiffs unless the Plaintiffs know where they stand when compared with those victims.

Admission of the Opinion and the Affirmation

30.   It could be seen from the above that, far from advancing the case of the 2nd Defendant, the Opinion seems to have confirmed that there would not be any valid claim against the 2nd Defendant by the Plaintiffs in the PRC. I would not allow the filing of the Opinion first on the ground that there was no appeal against the ruling of Registrar Poon; secondly that it was not relevant; thirdly that, as it now stands, the probative value of the Opinion does not justify its admission; fourthly that there were no exceptional circumstances upon which I could rely to exercise my discretion under Order 32 rule 16A(4).

31.   As regards the Affirmation, the main function it serves is clarify that the party which took out the insurance policy in the PRC was the joint venture company but not Gd Bonwell Champion Tours Co Ltd as presented to the court on 24th April 2009 and so recorded in paragraph 4 of my judgement. As long as the party which took out the insurance in the PRC was not the 2nd Defendant, this aspect has no bearing on the judgement. There was no suggestion from Mr Cheung that the new evidence in the Affirmation would in any other way affect my judgement. To that extent, I do not think the Affirmation is relevant. On this ground alone, I would thus not allow the filing of the Affirmation.

32.   Furthermore, I should bear in mind Order 32 rule 16A(4) when considering whether I should allow the filing of the Affirmation at the stage of application for leave to appeal. Otherwise, the parties who had omitted to adduce certain evidence could avoid the application of Order 32 rule 16A(4) by making an application to adduce the omitted evidence at the stage of application for leave to appeal. If Order 32 rule 16A(4) were to apply, I would have reached the same conclusion of refusing the filing of the Affirmation on the ground that there were no exceptional circumstances.

33.   Having regard to all the above, I am not satisfied that the 2nd Defendant has demonstrated any real prospect of success in the appeal. I would thus dismiss the Appeal Summons with costs to the Plaintiffs to be taxed if not agreed with certificate for counsel. The costs order shall become absolute in 14 days.

 (Raymond Tsui)
 Deputy District Judge

Representation:

Mr. Allen Lam instructed by Messrs S. H. Chan & Co. for the Plaintiffs.

Mr. Jeremy Cheung instructed by Messrs Reimer & Partners for the 2ndDefendant.

Application for leave to appeal by the 2nd defendant to Court of Appeal dismissed. Please see HCMP1759/2009 dated 11 November 2009

66113-EN-2009-06-04

FANG GUO QUAN AND ANOTHER v. CHOI MING SANG AND ANOTHER

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DCPI 1468/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

PERSONAL INJURIES ACTION NO. 1468 OF 2008

------------------------

BETWEEN

 FANG GUO QUAN and YU YAN WEIPlaintiffs
 and 
 CHOI MING SANG1st Defendant
 WEISHENG BUS LIMITED2nd Defendant

----------------------

Coram: Deputy District Judge Raymond Tsui in chambers (open to the public)

Date of Hearing: 24th April 2009

Date of Handing Down Decision: 4th June 2009

 

----------------------

DECISION

--------------------

 

1.  This is an application of the 2nd Defendant who took out a summons (the “Summons”) dated and filed on 17th December 2008 for stay of proceedings on the ground of forum non conveniens. It is stated in the Summons that the proper forum should be the Court of Dongguan City of China (廣東省東莞市中級人民法院). 

2.  By the Summons, the 2nd Defendant tries to invoke the inherent jurisdiction of the court. But I am satisfied that section 48(5) of the District Court Ordinance, Cap. 336 confers on the court the power to stay any proceedings before it either on its own motion or on the application of any person. 

Background  

3.  This action is brought by the Plaintiffs against the 1st and the 2nd Defendants for damages for personal injuries sustained by the Plaintiffs in a traffic accident in China.

4.  The 1st Defendant was the driver of a coach (the “Coach”) of which the Plaintiffs were the passengers. The 2nd Defendant was a company carrying on the business of providing, inter alia, transportation services. It was the appointed agent of Gd Bonwell Champion Tours Co Ltd (“Gd Bonwell”) and was responsible for selling tickets to travellers for Gd Bonwell. Gd Bonwell was the party who took out insurance policies on the Coach for accidents that happened in China and in Hong Kong. 

5.  It is the case of the 2nd Defendant that the 1st Defendant was either hired by Gd Bonwell direct or an employee of a company incorporated in China by the name 廣東南順旅運有限公司 which contracted with Gd Bonwell to drive the Coach. Gd Bonwell is the owner of the Coach and has its main place of business in the PRC. There was, however, no evidence testifying the matters in this paragraph. But the Plaintiffs did not dispute these claims. I am prepared to proceed on the assumption that these matters are true. 

6.  I note that the 1st Defendant is a Hong Kong resident and both Gd Bonwell and the 2nd Defendant are companies incorporated in Hong Kong.

7.  The Plaintiffs’ claim is that in or about mid July 2005, the Plaintiffs bought coach tickets at the 2nd Defendant’s office in Hong Kong to travel from Guangzhou to Hong Kong. The 1st Defendant was the employee and/or agent of the 2nd Defendant driving the Coach which the Plaintiffs were on board. At the time of the accident, the 1st Defendant was driving the Coach on the Guangzhou-Shenzhen Highway southbound. When the Coach cut into the first lane from the second lane, the Coach hit another vehicle in front of it driven by another driver by the name徐輝鵬, a Chinese national. As a result, the Plaintiffs, together with other passengers, sustained injuries. 

8.  After the accident, 17 passengers, including the Plaintiffs, were sent to the hospital. After treatment, the Plaintiffs then signed an application letter in which the following was recorded:

「… 現向交警部門申請不立案處理,所有費用均由我們自行負責,不需要責任方賠償,不需交警出具證明材料。」

9.  I was informed by Mr Cheung, counsel for the 2nd Defendant, that the 2nd Defendant would not rely on the said application letter. 

10.  A Writ of Summons with Indorsement of Claim was issued by the Plaintiffs on 2nd July 2008. The Statement of Claim was served by registered post to the two Defendants on 17th September 2008. The 2nd Defendant acknowledged service of the Writ of Summons on 8th October 2008. As mentioned above, the 2nd Defendant took out the Summons on 17th December 2008. In support of and in opposition to the application, both the 2nd Defendant and the Plaintiffs had filed affirmations. 

11.  Mr Chen Weiping, a director of the 2nd Defendant, filed an affirmation for the 2nd Defendant. Exhibited to his affirmation is a Traffic Incident Confirmation (「交通事故認定書」) dated 12th August 2005 issued by the Traffic Police of the Police Bureau of Dongguan City. The said Confirmation states that upon investigation, it was found that the 1st Defendant did not comply with the safety rules and was responsible for the incident. In addition to the said Confirmation, exhibited to Mr Chen’s affirmation is a Statement on Journey of Large Vehicle (「大客車載客情況說明」). The said Statement states that eleven passengers, including the Plaintiffs, applied to waive the right to file claims for compensation. Another document exhibited to Mr Chen’s affirmation is a Technical Inspection Report of the Coach which was dated 7th August 2005 and issued by the relevant authority in China. The said Report covers the braking, lighting and wheeling systems of the Coach. The test result is graded as “Pass” in the said Report. 

12.  At a hearing on 22nd December 2008 before Registrar Poon, an application was made to the learned Registrar by the legal representative of the 2nd Defendant for filing an affirmation to exhibit expert evidence on the PRC law. The application was refused. The learned Registrar then gave directions on the filing of further affirmations by the parties. The orders (the “Order”) made by the learned Registrar included several directions one of which was that “[n]o further affirmation should be filed by any party without leave of the court”. The Summons was then adjourned for hearing before me today. 

13.  At the hearing before me, Mr Cheung applied for an adjournment so that the 2nd Defendant could file an affirmation to exhibit expert opinion on the PRC law.  

14.  Mr Cheung submitted that there were two insurance policies in respect of the Coach, one covering accidents occurring in Hong Kong and the other one covering accidents occurring in the PRC. Since the accident occurred in the PRC, the China insurance policy would be relied upon for compensation. The maximum amount of compensation that could be paid to the Plaintiffs under the China insurance policy would be RMB 100,000 for each of them. According to the PRC law, the insurance company would only compensate the Plaintiffs if the claim proceeded in the PRC. Mr Cheung also submitted that vicarious liability was now available in the PRC. He further pointed out that there was a trend in the PRC that the quantum of damages awarded was increasing. I note that these points were made in light of the judgement of Suffiad J in Kwok Yu Keung v 楊鵬璋 transliterated as Yeung Pang Cheung & Ors (HCPI No. 579/2004, 9th September 2005). I shall return to the judgement of Suffiad J later. 

15.  The application for filing expert evidence was opposed by Mr Lam, counsel for the Plaintiffs, who submitted that since the learned Registrar had refused the application of the 2nd Defendant to file affirmation on expert opinion on the PRC law, the proper avenue of the 2nd Defendant was appeal against the Order. Mr Cheung replied that the Order did leave the door open for re-application and that further affirmation would be allowed as long as the court granted leave.

16.  In Jindal Exports Ltd v Waco Trading Co Ltd [2000] 2 HKC 46, a second affirmation was filed by the defendant without leave in opposition to the plaintiff’s application for summary judgement. The master refused the application and proceeded with the hearing of the summary judgement application. He refused to record both the application and the refusal in his notes of proceedings. He also dismissed the plaintiff’s application. The plaintiff appealed against the master’s decision.  Deputy Judge Chu, as she then was, dealt with and refused the application by the defendant for leave to file further affirmation for the purpose of the appeal by the plaintiff. Her Ladyship commented at p.47I-48A: 

“In my view, what the defendant should have done is to appeal against the Master’s refusal instead of taking out the present summons applying for leave to file the affirmation. An application which is similar to the present summons had been made to the Master and he had made a decision on it. It is procedurally wrong to renew that application instead of appealing against it. The fact that the Master had refused to note in his notes of proceedings the application for leave and the refusal is not a bar to an appeal.” 

17.  Subsequently, in Ip Yin Ping & Ors v Ip Anne [2003] 2 HKC 595, Deputy Judge Lam, as he then was, reviewed the relevant cases and came to the view that “it would be more appropriate to lodge an appeal against the decision of the master rather than making a fresh application”. 

18.  In Ip Yin Ping & Ors, there was a summons for security for costs. Directions were given by a master for filing of affirmations. The master also ordered that no further evidence to be filed without leave. The plaintiffs failed to file affirmation according to the directions. They took out a summons one day before the substantive hearing for filing affirmation out of time. The summons was heard together with the substantive hearing and was refused. The master then proceeded to hear the security for costs summons and also dismissed the same. The plaintiffs appealed against both decisions.

19.  Our case is similar to Jindal Exports Ltd since there was no appeal against the decision of the learned Registrar. It is thus clear that, applying Jindal Exports Ltd, the 2nd Respondent should have lodged an appeal against the decision of the learned Registrar. I note that there was no specific order enjoining that there should not be any affirmation of expert evidence on the PRC law. But it does not change the fact that the same had been determined by the learned Registrar. In my view, the only way that the Order could be overturned is by way of an appeal.

20.  I do not agree that the Order leaves the door open for re-application. The direction that further affirmation could be allowed with leave of the court does not alter the fact that the application for filing affirmation on expert evidence had been determined. Such direction was made to provide for some unforeseen situations which warranted the filing of affirmations, not as another avenue whereby the 2nd Defendant could attempt to revive an application which had been rejected. 

21.  In any event and assuming that Mr Cheung was right that the Order did allow the filing of further affirmation upon leave granted by the court, it was far too late for the 2nd Defendant to apply for leave to file the affirmation today. The Order was made on 22nd December 2008. The 2nd Defendant could have applied for leave to file the affirmation before the hearing today. Nothing was done by the 2nd Defendant during the interim. No explanation (as opposed to unsatisfactory explanation) was given as to why nothing was done during the interim. This is one of the factors that I should take into account in exercising my discretion. Although it is not determinative, it adversely affects the application. 

22.  I am also of the view that, as far as the argument that the insurance company would only compensate the victims who has obtained judgement from a PRC court is concerned so that expert evidence on the PRC law is necessary to explain the legal position, the same, if not irrelevant, carries little weight. How the Defendants satisfy the judgement is a matter of their own concern. Of course, I appreciate that probably all operators rely on insurance coverage in the event of being held liable for any accidents. Insurance, however, is just one of the ways whereby a judgement could be satisfied. The operators could in theory satisfy the judgement from their own resources without recourse to the insurance cover. 

23.  With or without the insurance cover, the Plaintiffs are still entitled to sue the Defendants. In this regard, I note that the issue of whether the Plaintiffs are entitled to sue the 2nd Defendant was not disputed by the parties. Mr Cheung cited Wong Wai Hing v Hui Wei Lee [2001] 1 HKLRD 736 for the proposition that the 2nd Defendant could be liable on the basis of vicarious liability as the 1st Defendant was driving the Coach on the 2nd Defendant’s business or for its purposes. Mr Lam cited Wong Mee Wan (Administratrix of the Estate of Ho Sui Yee Decd) v Kwan Kin Travel Services Ltd [1995] 3 HKC 505 for the principle that, as a supplier of service, the 2nd Defendant might still be liable for breach of its contractual obligation if the service was performed without the exercise of due care and skill on the part of the sub-contractor. On either one or both of these authorities, the 2nd Defendant could be held liable for the negligence of the 1st Defendant.   

24.  In addition to the above, a new Order 32 rule 16A was introduced by the Civil Justice Reform which took effect on 2nd April 2009. O32 r16A(4) provides that “[w]here the determination of the application is adjourned for the hearing of the summons, no further evidence may be adduced unless it appears to the Court that there are exceptional circumstances making it desirable that further evidence should be adduced.” Order 32 r16A(5) provides that “[p]aragraph (4) is subject to a direction given under paragraph (3).” Paragraph (3) refers to the directions given in a call-over hearing before a master. In our case, it means the Order given by the learned Registrar. Both parties have complied with the Order by filing their affirmations. The only part of the Order that is relevant is the part extracted and discussed above.  

25.  Mr Cheung submitted that the situation in the present case was exceptional in that no court had dealt with the situation where there were two insurance policies in respect of the same vehicle and where the applicable insurance policy could only be enforced by a judgement of a Chinese court. Mr Lam submitted that there was nothing exceptional in the present case and that the 2nd Defendant had had its opportunity in December 2008 to apply for filing an affirmation.

26.  I am not convinced that there are exceptional circumstances in the present case. Time and again, the court has to deal with novel situation but that, per se and without more, does not render the situation exceptional. Even again assuming that Mr Cheung was right that the Order did allow the 2nd Defendant to file further affirmation with leave of the court, in the absence of exceptional circumstances, there is no basis for me to exercise the discretion under Order 32 rule 16A(4).

27.  The application of the 2nd Defendant for an adjournment for filing an affirmation on expert evidence on the PRC law is refused.    

The Forum Conveniens Principles 

28.  The principles relating to forum conveniens stated by the House of Lords in Spiliada Maritime Corp v Consulex Ltd, The Spiliada [1996] AC 460 were summarized by the Hong Kong Court of Appeal in The Adhiguna Meranti (owners of cargo) v The Adhiguna Harapan (owners of ships) [1988] HKLR 904. A summary of the three-stage test was propounded in The Lanka Muditha [1991] 1 HKLR 741, 744B-D:

“(I)  Is it shown that Hong Kong is not only not the natural and appropriate forum for the trial, but that there is another available forum which is clearly or distinctly more appropriate than Hong Kong …

(II)  If the answer to (I) is yes, will a trial at the other forum deprive the plaintiff of any legitimate personal or juridical advantages. The evidential burden here lies on the plaintiff. 

(III)  If the answer to (II) is yes, a court has to balance the advantages of (I) against the disadvantages of (II) … Deprivation of one or more personal or juridical advantages will not necessarily be fatal to the applicant provided that the court is satisfied that notwithstanding such loss substantial justice will be done in the available appropriate forum … Proof of this … rests upon the applicant for the stay.” 

29.  This three-stage test was also applied by the Court of Appeal in Esquel Enterprises Ltd v Anr and TAL Apparel Ltd & Anr [2006] 2 HKLRD 363, 368J-369D. 

Stage I

30.  Is Hong Kong the natural and appropriate forum? The burden is on the applicant, i.e. the 2nd Defendant, to show that Hong Kong is not only not the natural forum but also the PRC court is clearly or distinctly more appropriate than Hong Kong court (The Adhiguna Meranti, p. 907G).

31.  As could be gathered from the Statement of Claim, the claim of the Plaintiffs are based on both contract and tort.

32.  As far as the contractual claim is concerned, there was no evidence before the court as to the terms of the contract of carriage. Various implied terms are pleaded in the Statement of Claim whereby the 2nd Defendant was obliged to, inter alia, take reasonable precaution to ensure the safety of the Plaintiffs. No choice of law or jurisdiction clause is pleaded.

33.  The Policy Schedule to the Hong Kong insurance policy and the China insurance policy were exhibited. They were silent as to the jurisdiction and the choice of law. In my view, the insurance policies are in any event irrelevant as they would only govern the relationship between the owner of the Coach and the insurance company but not between the parties to the contract of carriage.  

34.  Insofar as the claim is based on tort, the jurisdiction in which the tort has been committed is prima facie the natural forum for the determination of the dispute (The Albaforth [1982] 2 Lloyd’s Rep 91, 94). But that is only one of the factors that would be considered by the court. Ma CJHC pointed out in The Peng Yan [2009] 1 HKLRD 144, 156:  

“28.   It is therefore important when applying The Albaforth principle in the context of forum non conveniens applications, to examine just how close a connection there really exists with any given forum. In some cases, the place of the commission of the tort may be decisive; in others, perhaps not weighty at all. The underlying principle to be firmly borne in mind is the basic test in The Spiliada The Adhiguna Meranti. The place of the commission of the tort may in some cases be quite fortuitous and may provide no more than a convenient starting point or prima facie position. The court is required to look into more substantial factors in the application of the basic test…” 

35.  One of the matters that I should take into consideration is the choice of law. In Boys v Chaplin [1971] AC 356, the respondent was injured in a traffic accident in Malta which was caused by the negligence of the appellant. Both the appellant and the respondent were normally resident in England. At the time of the accident, they were serving in H.M. Armed Forces stationed in Malta. The House of Lord ruled that as both parties were only temporarily present in Malta, English law should apply.

36.  The case Boys v Chaplin was applied in Kwok Yu Keung. The plaintiff in Kwok Yu Keung sued the defendants for personal injuries sustained by him in a traffic accident which occurred in Guangdong Province of China. At the time of the accident, the plaintiff was one of the passengers on board the coach driven by the 1st defendant who was a Hong Kong resident and was in the employ of the 2nd and the 3rd defendants. The coach was registered under the name of the 2nd defendant and the coach service was provided by the 3rd defendant. Both the 2nd and the 3rd defendants were companies incorporated in Hong Kong.    

37.  The 2nd and the 3rd defendants applied for stay of proceedings on the ground of forum non conveniens in favour of proceedings in China. The application was refused.

38.  In determining that the proper law to be applied should be Hong Kong Law, Suffiad J observed as follows: 

“15.  Indeed effect was given to such by the House of Lords in their decision in Boys v Chaplin [1971] AC 356, where the plaintiff and defendant were both English nationals involved in a road collision in Malta. Maltese law differed from English law in that under Maltese law, the plaintiff could only recover pecuniary loss, not compensation for pain and suffering as in English law. The House of Lords concluded that as both parties were English and were only temporarily present in Malta, English law should apply as the system of law much more closely connected with the relationship between the parties. 

16.  In coming to such a decision, it can at once be seen that the general rule that the wrong be doubly actionable, both in England and the place where the tort was committed, can be displaced on evidence that in all the circumstances English law has the most significant relationship with the occurrence and the parties.  

…

23.  In conclusion on the choice of laws, I take account that the parties are either Hong Kong residents or companies incorporated in Hong Kong, secondly, although the accident happened in China, the parties were only there temporarily. Thirdly, in the absence of any agreement that PRC law was the applicable law for the contract of carriage, those factors would be sufficient to displace the general rule that the lox loci delicti should be the governing law in the matter under dispute and that Hong Kong law should apply. The decision is arrived at notwithstanding the submission by the defendants that the concept of vicarious liability as it is understood in Hong Kong law has no application in PRC laws. It is no different from the decision in Boys v Chaplin where under Maltese law only pecuniary loss can be entertained whereas under English law the plaintiff can claim damages for pain suffering and loss of amenities.” 

39.  The facts of the present case are strikingly similar to those of Kwok Yu Keung, particularly when there is no evidence on the PRC law. I am satisfied that the law applicable in the present case should be the Hong Kong law. In coming to this conclusion, I have considered that all the parties are Hong Kong residents or companies incorporated in Hong Kong, that they and their agents were in China only temporarily and that there was no agreement (or no evidence of any agreement) that the PRC law was the applicable law. It is obvious from the judgement of Suffiad J that these factors alone would be sufficient for the court to conclude that the applicable law should be Hong Kong law.   

40.  Even assuming that the PRC law were to be taken as the law applicable, the fact that Hong Kong courts have regularly applied foreign law with the help of experts would render this consideration less important in the overall weighing exercise.  

41.  Besides the choice of law, I have to consider the logistics issues. As already noted, all the parties to the present action are Hong Kong residents or companies incorporated in Hong Kong. I note that there may be civilian witnesses and witnesses from the Chinese authorities in the PRC but there is no suggestion that it would be difficult for these witnesses to come to Hong Kong or that the relevant authorities were unwilling to offer help. It was noted by Deputy Judge To in Xu Yi Hong v Chen Ming Han & Ors (HCA No. 1109/2005, 3rd October 2006) that “[t]he large number of PRC litigants in our courts these days shows that travelling to Hong Kong or obtaining two way permits to come to Hong Kong is no longer a consideration against Hong Kong as a forum conveniens.” I respectfully agree with the learned Deputy Judge.   

42.  Considering all the above, I am satisfied that the 2nd Defendant has failed to discharge its burden required at Stage I of the test.  

Stage II

43.  Given my decision above, it is not necessary for me to deal with Stage II. But since counsel had argued matters relating to this Stage (though in the context of application of filing expert evidence), I shall briefly deal with the matters. 

44.  The absence of vicarious liability in PRC law is obviously a matter that has to be taken into account. In this regard, Suffiad J commented in Kwok Yu Keung: 

“34.   A further matter that I take into account is the fact that it is the defendants’ stance that the concept of vicarious liability (as it is known in Hong Kong law) has no application in the PRC court under its laws. Therefore if he had to bring his case in the PRC court, that would also deprive the plaintiff of a juridical advantage of being able to claim in the Hong Kong court against the employers of the 1st defendant on the basis of vicarious liability for the negligence of the 1st defendant. 

45.  Mr Cheung’s submission that the law in the PRC had changed and that vicarious liability was now available in the court of the PRC was not supported by any evidence. I believe this issue of vicarious liability was one of the matters that would have been dealt with by the 2nd Defendant’s proposed expert evidence on the PRC law. The effect of this change is that the Plaintiffs could sue the employer or the principal of the 1st Defendant who may not have any contractual relationship with the Plaintiffs. In our case, it means that the Plaintiffs could sue the 2nd Defendant who is the principal of the 1st Defendant in the PRC when in fact that is what they are doing in the Hong Kong proceedings. Thus, assuming that Mr Cheung was right about the vicarious liability in the PRC, it would mean one less juridical disadvantage to the Plaintiffs if the case proceeds in the PRC. In other words, the Plaintiffs would not be deprived of the juridical advantage that they could now enjoy in Hong Kong when the case is brought in the PRC. However, this aspect of the juridical advantage is only one of the considerations that the court would take into account. I do not see this single consideration could tip the balance in favour of the 2nd Defendant in a significant way.  

46.  In my view what is far more important is the quantum of damages recoverable. In this regard, Suffiad J said in Kwok Yu Keung that: 

“33.   As for the stage (b) test, it is common grounds between the parties that damages assessed by the Hong Kong court will be substantially more than damages assessed  by the PRC court. However, in this connection it should be noted that the damages assessed by Hong Kong courts are compensatory in nature. Viewed from that angle, it must follow that if damages assessed by the PRC courts are substantially less, then it must mean that such damages assessed by a PRC court is inadequate to properly compensate the plaintiff and therefore deprive him of a personal advantage if he had to bring his case in the PRC court.”  

47.  Mr Cheung submitted that there was a trend in the PRC court that the quantum of damages was on the rise. There was no such evidence before the court. Again, I believe this would have been one of the subject matters of the proposed expert evidence on Chinese law. Even if there was such evidence, that would not help the case of the 2nd Defendant as the compensation that could be awarded to the Plaintiffs was restricted to RMB 100,000 for each person. The quantum of damages claimed by the first-named Plaintiff and the second-named Plaintiff in the present proceedings are respectively roughly HK$250,000 and HK$500,000. The Plaintiffs may or may not be able to prove that they are entitled to be awarded these amounts as compensation in the Hong Kong court. For the purpose of the present application, however, the important point is they would be deprived of the opportunity of being allowed these amounts of compensation if they were to proceed with their claims against the Defendants in the PRC. In my view, such a personal advantage is important and failure to overcome this issue would be fatal to the application of the 2nd Defendant.  

48.  Would the availability of vicarious liability in the PRC increase the quantum as more parties would be held liable? I do not think so. On this note, I refer to the extract from the judgement of Suffiad J cited above in which His Lordship commented that both parties before him agreed that damages assessed by the Hong Kong court would be substantially larger than those assessed by the court in the PRC. Both counsel appearing before me did not suggest anything to the contrary. Although Mr Cheung submitted that more damages would now be awarded by the PRC court, he did not specify the particulars or point out whether there were any changes to the rules regarding assessment of damages by the PRC court.

49.  Thus, the availability of vicarious liability would only have the potential benefit of joining more parties who would be held liable for the loss suffered by a plaintiff. Admittedly, the position of a plaintiff would be better because he now stands a better chance to have the judgement satisfied as more parties would be found liable. But it does not solve the far more important problem that the damages awarded by the PRC court would be inadequate to properly compensate a plaintiff.

50.  To this extent, filing of affirmation on expert evidence on the PRC law would not help the case of the 2nd Defendant as it had not been pointed out in Mr Cheung’s submission whether there had been changes to the rules regarding assessment of damages in the PRC. This is also one of the reasons why the application of the 2nd Defendant’s for filing of an affirmation on expert evidence on the PRC law is refused.    

51.  Mr Cheung suggested that a large chunk of legal costs could be saved if the trial takes place in China. There is no evidence on the cost comparison between proceedings in the PRC and Hong Kong. It is perhaps well accepted that litigation in Hong Kong is an expensive exercise. The court, however, is in the dark as to the likely costs that would be incurred and the rules on costs in the PRC legal proceedings.

52.  Mr Cheung further suggested that if the trial takes place in Hong Kong, PRC law experts would be required to testify on issues relating to choice of law, liability and assessment of damages. This suggestion, however, is premised on the assumption that the PRC law is the law applicable. Since I have ruled that the applicable law is Hong Kong law, Mr Cheung’s argument is rendered invalid by my ruling. Even if his argument applies, he still faces the obstacle that there is no evidence on the cost comparison as mentioned above. 

53.  As far as enforcement of the judgement to be obtained by the Plaintiffs is concerned, in the absence of evidence suggesting otherwise, I believe, prima facie, it must be easier for the Plaintiffs to enforce the judgement against the 1st and the 2nd Defendants in Hong Kong. I was informed by counsel that the “Arrangement on Reciprocal Enforcement of Judgements in Civil and Commercial Matters by the Courts of the Mainland and of the Hong Kong Special Administrative Region pursuant to Choice of Courts Agreement between Parties Concerned” was yet to be put into effect. But it seems to me that the Arrangement would only apply to a judgement given pursuant to a choice of mainland court agreement. I do not think there is any such agreement in this case. Thus, even if the Arrangement were in place, it does not apply to our case. 

54.  Mr Cheung also submitted that the Plaintiffs had failed to join Gd Bonwell as a party and Gd Bonwell would play an important role in the contribution to the eventual award of damages. I believe Mr Cheung was trying to argue that such a fact would give more “PRC connection” to the PRC court. It is not, however, unusual that a plaintiff would choose carefully which defendants to sue if there are more than one defendant who would be held responsible, sometime for the obvious reason that a particular defendant is more likely to be able to satisfy the judgement. The Plaintiffs in our case could choose the parties they want to sue for their own reasons. If the 1st and the 2nd Defendants think that they are entitled to any contribution from Gd Bonwell, they could issue third party proceedings against Gd Bonwell. Until then, Gd Bonwell is not a party to the present proceedings and its potential liability to contribute carries little weight in the weighing exercise, if any at all. The same applies to the driver (徐輝鵬) of the other vehicle involved in the accident.

55.  Of course, if the 2nd Defendant were to apply for joining Gd Bonwell and徐輝鵬 as third parties, they would run the risk of being treated as submitting to the jurisdiction of the Hong Kong court. But still, this does not detract from the fact that the Plaintiffs are entitled to choose the defendants they want. It should be appreciated that at the same time, by leaving out Gd Bonwell and徐輝鵬, the Plaintiffs also run the risk of the judgement not being satisfied upon enforcement against the 1st and the 2nd Defendants who may not have sufficient financial means.  

56.  If I were to rule on the Stage II test, bearing in mind that the burden of proof is on the Plaintiffs, I would rule in favour of the Plaintiffs. 

Conclusion 

57.  Bearing the above in mind, I am satisfied that the 2nd Defendant has failed in its application for stay of proceedings. 

58.  The orders I shall make are as follows:

a.  the Summons is dismissed;

b.  there shall be a cost order nisi that costs of the Summons be to the Plaintiffs to be taxed if not agreed, with certificate for counsel; 

c.  the cost order shall become absolute in 14 days.

 (Raymond Tsui)
Deputy District Judge

Representation:

Mr. Allen Lam instructed by Messrs S. H. Chan & Co. for the Plaintiffs.

Attendance of the 1st Defendant is dispensed with.

Mr. Jeremy Cheung instructed by Messrs Reimer & Partners for the 2nd Defendant.