O\'BRIEN TSE SHUK CHUN SANDRA v. LO HOI YIN AND OTHERS

 DCPI 2315/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

PERSONAL INJURIES ACTION NO. 2315 OF 2008

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JUDGMENT ON COSTS

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Background

1.  On 24 June 2010, I handed down Judgment in these proceedings, whereby the 2nd Defendant ("Mr. Lee") was found to be liable in negligence in respect of the injury sustained by the Plaintiff ("Mrs. O'Brien") in a collision. The issue of costs was left for further argument, which took place on 29 June 2010.

2.  The Writ in these proceedings was issued on 31October 2008. Mrs. O'Brien sought damages of $120,000. On 13 January 2009, the 1st Defendant ("Mr. Lo") through his solicitors openly admitted liability. Interlocutory judgment was entered against Mr. Lo on 24 February 2009.

3.  On 19 January 2009, Mr. Lee had issued a notice of contribution/indemnity against Mr. Lo, and on 9 March 2009 (as reflected in the Order of Master K. Lo made on the same day), Mr. Lo conceded to judgment in the contribution proceedings in favor of Mr. Lee, thereby agreeing to indemnify Mr. Lee fully for any damages for which Mr. Lee may be held liable to pay to Mrs. O'Brien.

4.  The quantum of Mrs. O'Brien's claim for damages was agreed on 11 June 2010 at $50,000. The parties have agreed that Mr. Lo and the 3rd Defendant, the Motor Insurers' Bureau (“MIB”), will pay: (1) Mrs. O'Brien's costs on the issue of Mr. Lo's liability up to 24 February 2009 (when interlocutory judgment was entered against Mr. Lo), and (2) her costs on the issue of quantum up to 11 June 2010.

5.  The parties have failed to agree on the issue of Mrs. O'Brien's costs of proceeding with the action against Mr. Lee after 9 March 2009 (when Mr. Lo consented to judgment in the contribution proceedings) and up to trial on 17 June 2010.

6.  The applicable legal principles are as set out in In re Elgindata Ltd. (No.2) [1992] 1 WLR 1207 and in Wang Din Shin v. Nina Kung CACV No. 460/2002 and CACV 67/2003, 19 April 2005. Costs are in the discretion of the court, and should follow the event, except when it appears to the court that in the circumstances of the case some other order should be made, as where the successful party raised issues or makes allegations improperly or unnecessarily.

7.  As I have indicated at the commencement of trial when arguments on costs were first raised, a plaintiff is in law entitled to commence proceedings against two or more defendants who are jointly and severally liable in negligence, and to pursue judgment against any of these defendants, notwithstanding that some other defendant has conceded liability or consented to judgment. However, if it can be established that a party is guilty of unreasonable or unnecessary conduct in proceeding with the action, such party may be at its own peril as to costs.

The question of conduct

8.  I agree that Mrs. O'Brien has the right to pursue to judgment against Mr. Lee on the basis of his joint and several liability in negligence. However, with Mr. Lo having consented to judgment against him on liability and having agreed quantum, the trial on Mr. Lee's liability was unnecessary and the costs of such trial could have been saved.  Mrs. O'Brien has not explained the need for a judgment against Mr. Lee.

9.  Moreover, Counsel for Mr. Lo has drawn attention to a letter dated 12 March 2009 ("12 March 2009 Letter") from the solicitors then acting for Mr. Lo to Mrs. O'Brien's solicitors. By this time, these solicitors had already confirmed on 13 January 2009 that Mrs. O'Brien could enter judgment against Mr. Lo for damages to be assessed. On the other hand, Mr. Lee's liability was throughout denied by both Mr. Lee and by Mr. Lo.

10.  In the 12 March 2009 Letter, Mr. Lo's solicitors proposed that Mrs. O'Brien should discontinue the action against Mr. Lee and leave the outstanding issue of costs to be determined by the Court. This offer was not taken up by those acting for Mrs. O'Brien.

11.  When correspondence resumed about 9 months later, Mrs. O'Brien's costs of her action against Mr. Lee remained the bone of contention amongst the parties, but they were able in June 2010 to agree on quantum at $50,000 inclusive of interest.

12.   Ultimately, at the commencement of trial on 17 June 2010, Mrs. O'Brien proceeded with her case against Mr. Lee on liability, and two morning sessions were spent in total for calling Mrs. O'Brien and Mr. Lee to give evidence and to be cross-examined, and for opening and closing submissions to be made by Counsel.

13.  The Court's approach to determining costs without trial is helpfully summarized in the decision of Mr. Recorder Jat SC in Graham M. Morley v. Kwan Wo San & Ors. HCA 4366/2003, 30 December 2009. It is open to the court to make an order for costs without a full trial or determination of the substantive issues in dispute between the parties. The hands of the court are not tied as to what evidence it should or should not receive and what findings it should or should not make in a particular case for the purpose of adjudicating on costs. It is up to the parties to put forward such evidence as is helpful to their case for the purpose of seeking adjudication on the costs issue.

14.  The facts and evidence in this case are not complicated. Mr. Lee did not dispute many aspects of how the collisions of the vehicles concerned took place. Miss Loh, Counsel for Mr. Lo, argued that on the question of costs, the issue of whether Mrs. O'Brien had acted reasonably in joining Mr. Lee as a defendant could have been determined even without calling Mrs. O'Brien and Mr. Lee, on the basis of the documents and essentially the police statements disclosed. The costs of the examination and cross-examination of Mrs. O'Brien and Mr. Lee and the submissions on their evidence could have been avoided on this basis.

15.  Whether the course suggested by Miss Loh (or some other appropriate course) is adopted, I am satisfied that if the proposal made in the 12 March 2009 Letter was accepted, a substantial part of the costs of the two morning sessions in Court and the costs of the preparation of Counsel's submissions on the evidence regarding Mr. Lee's liability could have been saved. The Court could have been able to decide on the costs of Mrs. O'Brien's action against Mr. Lee without hearing evidence, or on a "broad brush" approach as described in BCT Software Solutions Ltd. v. C Brewers & Sons Ltd [2003] EWCA Civ 939, and/or on the basis of the available documentary evidence.

16.  I find therefore that the trial on the issue of Mr. Lee's liability in June 2010 was unnecessary, and further, that Mrs. O'Brien had been unreasonable in failing to accept the proposal made on behalf of Mr. Lo in the 12 March 2009 Letter. This is particularly so bearing in mind the small amount of Mrs. O'Brien's claim ($120,000), the settlement figures negotiated ($49,000 proposed in January 2009 and $50,000 agreed in June 2010), and the underlying objectives of the Civil Justice Reform with emphases on cost effectiveness, procedural economy and proportionality.

Costs Order

17.  As between Mrs. O'Brien, Mr. Lo and MIB, I order that: as agreed, Mr. Lo and MIB shall pay Mrs. O'Brien's costs on liability up to 24 February 2009 and her costs on quantum up to 11 June 2010; and that there be no order as to Mrs. O'Brien's costs after 11 June 2010.

18.  Following from my finding on the possibility of dealing with the question of costs without the necessity of a full trial on liability, I do not agree that Mr. Lo should be entitled to recover from Mrs. O'Brien the costs of the attendance of his counsel and his solicitors at trial in June 2010. Those acting for Mrs. O'Brien had made it clear to the solicitors acting for Mr. Lo and MIB on 14 June 2010 that their attendance at the trial on Mr. Lee's liability would not be necessary. Notwithstanding that, those acting for Mr. Lo and MIB chose to attend the trial on the basis that the evidence was relevant to the determination of the costs issue.

19.  As between Mrs. O'Brien and Mr. Lee, I order that: as agreed, Mr. Lee is to pay Mrs. O'Brien's costs up to 9 March 2009, which costs are to be paid by Mr. Lo and MIB; and Mrs. O'Brien is to pay Mr. Lee's costs on liability after 9 March 2009, including the costs of trial, which costs were unnecessary and incurred as a result of Mrs. O'Brien's unreasonable conduct.

20.  All costs include certificate for counsel.

Scale of costs

21.  Mrs. O'Brien's claim for $124,460 was ultimately settled at $50,000 inclusive of interest. It was argued that she should only be entitled to costs in accordance with the scale of costs applicable to the Small Claims Tribunal.

22.  On the question of whether Mrs. O'Brien should be entitled to her costs on the District Court scale, I bear in mind that the injuries are not very serious (expiration to herlaceration to her to her eyebrow and abrasion to her left knee), the expenses she incurred were not substantial, and as she has not suffered any loss of earnings, the main claim was for pain and suffering. Bearing in mind the authorities to which I have been referred on the likely amount of award of damages for Mrs. O'Brien 's injuries (Cheung Yu Tin v. Ho Hon Ka [2006] 2 HKLRD 674 and M Beraha & Co Ltd v. Ng Wai Lun [2004] 3 HKC 535), I am not entirely satisfied that at the time when the Writ was issued in the District Court in October 2008, it was then obvious that properly assessed, there was no reasonable prospect of her recovering an award exceeding the monetary jurisdiction of the Small Claims Tribunal. It was reasonable for Mrs. O'Brien and those advising her to take the course of the District Court, being the usual forum for small personal injury actions, with the expectation of an award just above the ceiling of the Small Claims Tribunal. I will allow her costs on the District Court scale.

DCPI 2315/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

PERSONAL INJURIES ACTION NO. 2315 OF 2008

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BETWEEN

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JUDGMENT

Background

1.  At about 8:30 pm, on 30 September 2007, several vehicles were travelling in line along the 3rd lane of Princess Margaret Road. The driver of the first vehicle, EL 7585 ("Vehicle 1"), saw an object in the middle of the lane, and stopped Vehicle 1. The drivers of the two vehicles behind Vehicle 1 followed suit, and were able to stop their respective vehicles behind Vehicle 1 without mishap initially. The 2nd Defendant ("Mr. Lee ") was the driver of the fourth vehicle in line, GH 8432 ("Vehicle 4"). He was not able to stop Vehicle 4 in time. Vehicle 4 collided into Vehicle 3 in front, pushing it forward to hit Vehicle 2 in the process. The driver of KP 293 ("Vehicle 5") behind Vehicle 4 swerved left into the 2nd lane in order to avoid hitting Vehicle 4. In the process, the right rear part of Vehicle 5 was hit by the nearside front part of the taxi KM 910 ("Vehicle 6") which was driven by the 1st Defendant ("Mr. Lo"), and travelling behind Vehicle 5.

2.  Mrs. O'Brien was a passenger sitting on the left in the backseat of Vehicle 6. She was injured as a result of Vehicle 6 hitting Vehicle 5 in front. These proceedings were instituted by Mrs. O'Brien against Mr. Lee, the driver of Vehicle 4, and Mr. Lo, the driver of Vehicle 6, to recover damages sustained by her as a result of the motor accident. She claims that both Mr. Lo and Mr. Lee were negligent and that their negligence had led to her injuries.

3.  On 24 February 2009, interlocutory judgment on liability was entered in favor of Mrs. O'Brien and against Mr. Lo. On 19 January 2009, Mr. Lee had issued a Contribution Notice against Mr. Lo, seeking an indemnity from Mr. Lo in respect of any liability which may be found against him. On 9 March 2009, judgment was entered by consent in the contribution/indemnity proceedings issued by Mr. Lee, whereby Mr. Lo agreed to be bound by any judgment that may be entered against Mr. Lee in relation to Mrs. O'Brien's claim, and to indemnify Mr. Lee in respect thereof.

The issues

4.  By the time of the commencement of trial, the parties had agreed on the amount of the damages payable to Mrs. O'Brien. In view of the interlocutory judgment that had been entered against Mr. Lo, and Mr. Lo's concession of liability to indemnify Mr. Lee under the Contribution Notice, the only remaining issues relate to Mr. Lee's liability towards Mrs. O'Brien in negligence, and the costs of Mrs. O'Brien's action against Mr. Lee.

Whether the accident was caused by Mr. Lee's negligence 

5.  At the commencement of trial, submissions had been made by Counsel for Mr. Lee that the trial on Mr. Lee's liability in negligence is academic and unnecessary by virtue of the judgment entered against Mr. Lo and Mr. Lo's concession that he is liable to fully indemnify Mr. Lee in relation to Mrs. O'Brien's claim against Mr. Lee. Counsel referred to the evidence in support of his submissions that there was no case against Mr. Lee, but I ruled that in the absence of a striking out at the interlocutory stage, it was inappropriate at trial to find summarily, before hearing the evidence from the witnesses, that Mr. Lee was not negligent. Any question of the unnecessary joinder of Mr. Lee, or the unreasonable conduct of these proceedings can and should be dealt with when costs are determined.

6.  Both Counsel for Mrs. O'Brien and Counsel for Mr. Lee rely on the case of Rouse v. Squires (1973) 1 QB 889, which was considered in Mak Kit Ching Kitty v. Tsang Yiu Wing HCPI 811/2009, 18 October 2006. It was held in Rouse v. Squires that if a driver negligently obstructed a highway and created a danger to other road users, including those driving too fast and not keeping a proper lookout but not those who deliberately or recklessly drove into the obstruction, then his negligence contributed to the causation of an accident of which the immediate cause was the negligent driving of another driver but which would not have occurred but for the continuing danger from the obstruction he had caused.

7.  Whereas Mr. Yip who appeared for Mrs. O'Brien claims that Mr. Lee had negligently created an obstruction and danger by failing to stop his vehicle in time and causing a collision between Mr. Lee's Vehicle 4 and Vehicle 3, and then a collision between Vehicle 5 and Mr. Lo's Vehicle 6, Mr. Wong who appeared for Mr. Lee sought to argue that the dangerous situation and obstruction on the highway was caused by the driver of Vehicle 1, Vehicle 2 and /or Vehicle 3, and that the obstruction no longer constituted a danger at the time of the second collision between Vehicle 5 and Mr. Lo's Vehicle 6 which led to Mrs. O'Brien's injuries. Mr. Wong argued that there was ample opportunity for Mr. Lo to appreciate the condition then posed on the road, that the chain of causation between any negligence on Mr. Lee's part and Mrs. O'Brien's injury was broken, and that the accident was caused solely by Mr. Lo's negligence in driving Vehicle 6.

8.  The following passage in the judgment of MacKenna J in Rouse v. Squires has been referred to:

"Where the party guilty of the prior negligence has created a dangerous situation, and the danger is still continuing to a substantial degree at the time of the accident, and the accident would not have happened but for this continuing danger, he is responsible for the accident as well as the party who was subsequently negligent."

9.  In my judgment, the first issue for determination is whether Mr. Lee had been negligent in any way. According to his own evidence, he was travelling at the relevant time at a speed of 60 to 65 km per hour, and he had observed that Vehicle 3 was about 4 or 5 car spaces away on the 3rd lane, with another vehicle ahead of it. Mr. Lee admitted that he had thought that Vehicle 3 was moving slowly, and that he had reduced the speed of Vehicle 4 as a result. It was only when he had approached Vehicle 3 that he realized that Vehicle 3 was in fact stationary. Mr. Lee had immediately braked, but he was not able to stop his own vehicle in time to avoid a collision. Mr. Lee accepted, in cross-examination, that he was negligent in failing to avoid the collision with Vehicle 3, although he denied that his negligence had led to Vehicle 6 hitting Vehicle 5.

10.  Although only Mr. Lee and Mrs. O'Brien were called to give evidence at trial, they both relied on statements which were made by the drivers of Vehicle 2, Vehicle 3 and Vehicle 5 to the police after the accident. According to these statements as well as the statement of the police officer who investigated the accident, Vehicle 1, Vehicle 2 and Vehicle 3 had all stopped on the 3rd lane and were stationary when Vehicle 4 collided with Vehicle 3. Further, it was a question of seconds between the time of these vehicles stopping and their being hit from behind.

11.  According to the police statement of the driver of Vehicle 5 ("Miss Wong"), Mr. Lee had suddenly stopped Vehicle 4, and although she had immediately braked, she thought that she might not be able to stop Vehicle 5 in time to avoid a collision. She therefore swerved left into the 2nd lane, but when only half of Vehicle 5 was in the 2nd lane, the back of her vehicle was hit by Mr. Lo's Vehicle 6.

12.  At one stage, Mr. Lo sought to claim, in a statement which he made to the police 11 days after the accident, that after he had seen some vehicles ahead of him stopping on the 3rd lane, he had reduced his speed, but Vehicle 5 cut into his lane from the left, and that this led to Vehicle 6 hitting Vehicle 5 when Vehicle 5 was half-way into his lane. This version of events is at odds with the police statements of the other drivers involved. On the face of the statement made by the investigating police officer, Mr. Lo had not mentioned to the officer on the day of the accident that Vehicle 5 had in fact cut into Mr. Lo's lane after the obstruction ahead, and before the collision between Vehicles 5 and 6. Mr. Lo's account is illogical and in any event unreliable since he was not in court to be cross-examined, and I reject his version of Vehicle 5 cutting into the 3rd lane.

13.  On the evidence, I accept that Mr. Lee had been negligent in failing to keep a proper lookout and failing to appreciate that Vehicle 3 in front of him had come to a halt. If he had paid sufficient attention, he would have been able to stop his vehicle in time to avoid hitting Vehicle 3, at a time when both Vehicle 2 and Vehicle 3 had stopped behind Vehicle 1.

14.  Mr. Lee's negligence led to the collision between Vehicle 3 and Vehicle 4 and to the creation or continuation of a dangerous obstruction on the 3rd lane of the road. On the evidence, the sudden stopping of Vehicle 2 and Vehicle 3, the first collision which involved Vehicle 4 hitting Vehicle 3, and the second collision which involved Vehicle 5 swerving left and then being hit by Vehicle 6, all took place within a short span of time.  To the extent that the dangerous obstruction was created initially by Vehicles 1, 2 and 3 stopping on the 3rd lane, the dangerous situation had not abated in the matter of seconds until Mr. Lee's collision, and was continued or aggravated by the presence of an additional vehicle, i.e. Vehicle 4 stopping behind Vehicles 1, 2 and 3. In my judgment, the dangerous situation of 4 vehicles being stationary on the 3rd lane of the road at 8:30 pm continued to a substantial degree at the time of the second collision, which occurred when Miss Wong had to swerve Vehicle 5 to the left to avoid hitting Vehicle 4.

15.  Mr. Lo has accepted that he was negligent in failing to avoid the collision with Vehicle 5. Although Miss Wong had been able to see that Mr. Lee had stopped his vehicle and she was able to take some evasive action to avoid hitting Vehicle 4, that does not necessarily mean that the obstruction no longer constituted a danger, or that the danger had been removed to avoid risks to other road users, including negligent users not keeping a proper lookout such as Mr. Lo.

16.  Although Mr. Lo was negligent, as admitted, the evidence does not suggest that he was reckless such that his conduct should be considered as a new or independent or the sole cause of Mrs. O'Brien's injuries, along the lines of Wright v. Lodge [1993] 4 All ER 299 and Ma Kit Ching Kitty v. Tsang Yiu Wing HCPI 811 of 1999, 18 October 2006. It was reasonably foreseeable that as a result of Mr. Lee's collision with Vehicle 3, and of his vehicle stopping on the 3rd lane, there was a risk of other following vehicles colliding and other road users suffering damage in seeking to avoid a collision with Vehicle 4. It cannot be said that the collision between Vehicle 5 and Vehicle 6 was "a new cause which can be described as either unreasonable or extraneous or extrinsic" (as used in the judgment of Lord Wright in TheOropesa [1943] 1 All ER 211 at 215, and cited in the judgment of Parker LJ in Wright v. Lodge), so as to break the chain of causation between Mr. Lee's negligence and the collision giving rise to Mrs. O'Brien's damage.

17.  I find therefore that Mr. Lee was negligent, and that his negligence had contributed in part to Mrs. O'Brien's injuries which were sustained as a result of the accident. There is no evidence that Mrs. O'Brien was negligent in causing or contributing to her own injuries. I therefore find that Mr. Lo and Mr. Lee are both liable for Mrs. O'Brien's agreed damages of $50,000. The parties have informed the Court that apportionment of liability between Mr. Lee and Mr. Lo is not necessary in view of Mr. Lo's concession of liability.

18.  The question of costs will be addressed by the parties separately.  

Mr. Samuel Yip, instructed by Messrs. K.Y. Woo & Co., for the Plaintiff

Mr. C.K. Wong, instructed by Messrs. Chu & Lau, for the 2^nd Defendant