WU NAI SANG v. FELLOWSHIP ENGINEERING LTD AND OTHERS

DCEC 243/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO 243 OF 2011

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DECISION

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Introduction

1.  In July 2016, this case was tried before me, in the absence of the 1^st respondent (“R1”).  Judgment was handed down on 14 September 2016 whereby, inter alia, R1 was held liable to pay compensation to the applicant (“A”) in the sum of $1,559,882.00 with interest.

2.  On 17 October 2016, R1 took out a summons applying to set aside the said judgment.

Procedural history

3.  The application was taken out on 22 February 2011 with R1 as the only respondent.

4.  A notice to act was filed by Messrs Alan Ho & Co (“Alan Ho & Co”) on behalf of R1 on 7 July 2011 and the answer of R1 was filed on 20 July 2011, which was subsequently amended on 21 October 2011.

5.  Alan Ho & Co conducted the proceedings on behalf of R1 until a notice to act in person was filed on 28 November 2013, which was signed by Mr Kwok Lai Wah (“Kwok”).

6.  Pursuant to the Order of HHJ Levy dated 15 January 2016, the trial of this case was fixed to be held on 20, 21, 22, 25 and 26 July 2016 and the pre-trial review to be held on 24 May 2016.

7.  Thereafter, R1 took no step in the proceedings and did not appear at the trial.

Legal principles

8.  Order 35 rule 2 of the Rules of the District Court provides:-

“(1) Any judgment, order or verdict obtained where one party does not appear at the trial may be set aside by the Court, on the application of that party, on such terms as it thinks just.

 (2) An application under this rule must be made within 7 days after the trial.”

9.  In dealing with an application to set aside a judgment, the court should take into account the following “general indications”:-

“(1) Where a party with notice of proceedings has disregarded the opportunity of appearing at and participating in the trial, he will normally be bound by the decision.

(2) Where judgment has been given after a trial it is the explanation for the absence of the absent party that is most important; unless the absence was not deliberate but was due to accident or mistake, the court will be unlikely to allow a rehearing.

(3) Where the setting aside of judgment would entail a complete retrial on matters of fact which have already been investigated by the court the application will not be granted unless there are very strong reasons for doing so.

(4) The court will not consider setting aside judgment regularly obtained unless the party applying enjoys real prospects of success.

(5) Delay in applying to set aside is relevant, particularly if during the period of delay the successful party has acted on the judgment, or third parties have acquired rights by reference to it.

(6) In considering justice between parties, the conduct of the person applying to set aside the judgment has to be considered; where he has failed to comply with orders of the court, the court will be less ready to exercise its discretion in his favour.

(7) A material consideration is whether the successful party would be prejudiced by the judgment being set aside, especially if he cannot be protected against the financial consequences.

(8) There is a public interest in there being an end to litigation and in not having the time of the court occupied by two trials, particularly if neither is short.”

See Hong Kong Civil Procedure 2017 Vol 1 at 35/2/1.

10.  In relation to the time limit of 7 days under sub-rule (2), the court has a discretion under Order 3 rule 5 to extend the period.  In doing so, the court must consider all the circumstances and decide whether the overall justice of the case requires the exercise of the discretion to extend time : see Hong Kong Civil Procedure 2017 Vol 1 at 35/2/2.

Discussion

11.  In his affirmation, Kwok said R1did not appear at the trial because R1 did not know the trial dates.  He said R1 believed that Alan Ho & Co would inform R1 once the date of the trial has been fixed.  However, Alan Ho & Co did not inform R1 of the trial dates.

12.  Kwok said at all time up to September 2016, R1 was never told that Alan Ho & Co would cease acting for it, nor did R1 tell Alan Ho & Co to cease acting for it.

13.  Kwok confirmed that he did receive documents sent from Court or the solicitors firm acting for A.  However, he would only take them to Alan Ho & Co without opening them.  He was told that Alan Ho & Co had also received the same documents.  Thereafter, he stopped redirecting the envelopes that he received to Alan Ho & Co.

14.  In September 2016, he received an envelope (which he later came to know to have contained the judgment in this case).  He did not open it but instead called Mr Tse of Alan Ho & Co but to no avail.  He then sought advice from another law firm and was told that judgment was entered against R1.

15.  In relation to the notice to act in person, Kwok said it was not signed by him and he had no knowledge of it being filed.

16.  Put it simply, Kwok is denying everything that would have linked him to have the knowledge of the scheduled trial and shifting the blame to Alan Ho & Co.

17.  As a matter of fact, starting from February 2014, there were no less than 7 affirmations of service deposing that the documents of this case had been sent to Kwok’s residential address at Room 1112, 11^th Floor, Chung Tak House, Chung On Estate, Ma On Shan, New Territories, Hong Kong.  On top of that, there were no less than 7 notices of fixing date; 1 notice of pre-trial review and 1 notice of trial sent to the same residential address by the Court. Kwok did not turn up at anyone of the occasions.

18.  It is hard to believe that Kwok did not open any of the aforesaid envelopes but instead took them to Alan Ho & Co.  To any normal people, regardless of his or her educational background, one must have asked why this was happening as a lawyer was already engaged to conduct the proceedings.  The behaviour of Kwok is at odd with common sense.

19.  Serious as it may be of the allegation that the notice to act in person was filed without Kwok’s knowledge and that Kwok did not sign on the said notice.  In my view, however, it does not serve to enhance the credibility of Kwok’s explanation.

20.  I must say that I am not at all persuaded by Kwok’s explanation.  In my view, Kwok deliberately ignored the proceedings until the time he realised that judgment has already been entered against R1.  Kwok is the author of the predicament R1 is in now and he has only himself to blame.

21.  Kwok has filed a brief witness statement on 10 April 2012.  He denied any involvement in the steel binding works and shifted the burden to R3.  Yet, he admitted having completed the Form 2 and sent back to the Labour Department.  Having heard the evidence of the other witnesses at the trial, I am unable to say that R1 is having a prospect of success.

22.  That being the case, there is no need to consider the implication of a re-trial.  However, I would note in passing that if a re-trial is necessary, it must be a re-trial involving all the parties because they are all connected to the project of works one way or the other.  It would be wrong to hold a re-trial just between A and R1.

Conclusion and order

23.  For the foregoing reasons, R1’s application is dismissed.

Costs

24.  I order that R1 shall pay A costs of this application with certificate for counsel, to be taxed if not agreed.

25.  A’s own costs shall be taxed in accordance with Legal Aid Regulations.

DCEC 243/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO 243 OF 2011

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JUDGMENT

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Introduction

1. Time and again, people take risk for gain at the costs of the others.  The result can be devastating.  This case is a glaring example.

Procedural history

2. For reasons that will be apparent, it took a very long time for all the respondents herein to become parties to these proceedings.

3. Initially, only the 1^strespondent ("R1") was named as respondent.

4. The 2^ndrespondent ("R2") was joined in with leave of court on 29 April 2011.

5. Likewise, the 3^rdrespondent ("R3") was joined in on 3 August 2012 and finally, the 4^threspondent ("R4") was joined in on 28 August 2014.

6. R1 took no further step in the proceedings after the filing of Kwok Lai Wah’s (郭禮華) (“Kwok”) witness statement. R1 did not appear at the trial.

Applicant's case

7. The applicant ("A") was a steel binder.

8. In the afternoon on 9 October 2010 while he was working at the construction site of a village house, later known as Golf Villa, Sheung Shui, New Territories ("the site"), he fell from a bamboo scaffolding at a height of 3 metres to the ground.  He sustained neck injury as a result.

9. In relation to the identity of his employer, he was by no means certain.  He put in an alternative case, namely, that it was either R1, or alternatively R3.

10. In relation to the identity of the principal contractor, his case is that it was either R2 or R4.

1^st respondent's case

11. R1 through a firm of solicitors filed an Answer on 20 July 2011 which was subsequently amended on 20 October 2011.

12. R1 stated that it was a sub-contractor of R2 for "making wooden structure (釘板)" of the site whereas R3 was a sub-contractor of R2 for "steel fixing (札(sic)鐵)" of the site.  R1 further stated that A was employed by R3 to work at the site.

2^nd respondent's case

13. R2 denied that he was either the principal contractor or a sub-contractor of the site.  R2 further denied that he was the employer of A at the time of the accident.

3^rd respondent's case

14. R3 said that on 24 July 2010, Kwok, who is a director and shareholder of R1, employed him to work as a bar fixer of the site.

15. At the request of Kwok, he introduced A and Yip Ming Yeung (葉明揚) ("Yip") to work at the site as bar fixers as well.  They began working at the site on 26 July 2010.  They were all employees of R1 and among themselves, R3 was the gang leader.

16. As gang leader, R3 was responsible for calculating and distributing the remuneration for the three of them whenever he received the same from R1. 

4^threspondent'scase

17. In its Answer dated 8 October 2015, R4 stated that it was engaged by the owner of the site to prepare the plans for the construction of a village house.  R4 denied to have any contractual relationship with R3 in respect of the works he was engaged in at the material time. 

Issues

18. The following issues are for the determination by this trial:-

(1)  whether A sustained injury while in the course of employment;

(2)  who was the employer of A in respect of the works he was engaged in at the site;

(3)  who was the principal contractor in respect of the works A was engaged in at the site;

(4)  who is or are liable to pay compensation to A under the Employees’ Compensation Ordinance, Cap 282 (“the Ordinance”); and

(5)  what is the compensation payable to A under ss7, 8, 10 and 10A of the Ordinance.

Whether the applicant sustained injury while in the course of employment?

Who was the employer of the applicant in respect of the works he was engaged in at the site?

19. These 2 issues can be dealt with together.

20. A was an experienced steel binder with almost 30 years of experience.  He knew R3 for over 20 years, who was also in the same profession.

21. According to A, in May 2010, he telephoned R3 to see if there was job for him to do.  R3 answered in the positive whereby he was employed by R3 to work at the site under an oral contract.  His daily wage was $950 at the time of the accident.  He was paid by R3 in cash every month.

22. On 9 October 2010 at the site, he was instructed by R3 to dismantle some steel pipes. In the course of doing so, he fell from a bamboo scaffolding at a height of 3 metres and hurt his neck.  At that time, R3 and Kwok was at the site.  He requested them to dial 999 but to no avail.  It was not until one hour later that R2 came who transported him to North District Hospital by a private car.

23. At the trial, A said he regarded the one who paid him as his boss.

24. R3 said he has worked as a steel binder for over 30 years.  He has known A for over 20 years.  The two of them, together with Yip, had worked together as a team for over 10 years.  However, they would also work for other employers individually and separately.

25. R3 said on 24 July 2010, Kwok requested him to do the steel binding works of the site.  Kwok knew that he would look for other steel binders on his behalf.  He told Kwok that the costs would be around $25,000 per house, which was agreed to by Kwok.  He then arranged to transport his steel bending and cutting machines to the site, the transportation costs of $700 was paid by Kwok.  At the same time, he notified Yip and A to commence works on the following Monday, 26 July 2010.

26. On the first day of works, Kwok gave the floor plans of the house to be built to R3 and gave him instructions of works.  Before commencement of the works, R3 asked Kwok if he had already taken out insurance coverage. Kwok replied in the positive. It turned out that it was untrue. 

27. R3 said his role was looking for steel binders on behalf of R1.  Because of his role as such, he was responsible for keeping attendance records and to distribute wages to fellow workers on behalf of R1.  On account of his added responsibilities, he could be regarded as a gang leader (工頭). He himself was also a steel binder employed by R1.  In any event, he was not the employer of A or Yip.

28. R3 said the sum of $25,000 per house was an estimation according to his experience which was the sum total of the wages of the 3 of them plus miscellaneous expenses. If any of them took days off, he had to find a replacement steel binder who would be paid at a higher rate.  Because of that, he had to seek the approval of Kwok beforehand.

29. Kwok only paid him $30,000 by a cheque of R1 for the works at the site on 17 September 2010.  Due to A's financial needs, he did pay him during the period from 26 July 2010 and 17 September 2010 from money received from other employers.

30. Yip, who worked together with A and R3, testified that he had worked as a steel binder for over 30 years.  He worked together with A and R3 from time to time.  They worked for different bosses.

31. On 24 July 2010, R3 told him to escort the steel bending and cutting machines from Tai Mei Tuk to the site.  On 26 July 2010, he and R3 commenced working at the site.  When R3 asked Kwok if he had taken out insurance coverage, he also said to Kwok that if he had not yet done so, he could introduce an insurance agent to him who would charge at a lower premium of $20,000 per house.  Kwok replied that he had already taken out insurance coverage.

32. He stressed that insurance coverage is most important to him because if accident happens, it is the workers who would be risking their lives, not Kwok.

33. Yip said the three of them were working for R1.  R1 paid their wages to R3.  R3 would then paid him his wages according to the attendance record.  His wages were calculated on a daily basis.

34. Unlike Poon Chau Nam v Yim Siu Cheung (2007) 10 HKCFAR 156 and Lee Ting Sang v Chung Chi Keung [1990] 2 AC 374, there is no dispute that A was an employee at the time of the accident.  The question is who was his employer.

35. Mr Dennis Law, counsel for A, submitted that R3 was a gang leader as well as the employer of A.  Mr Law is also relying on para 40-026 of Chitty on Contracts, 32^nd Edition, 2015, Vol 2 where the learned author analysed the labour-only sub-contracting in the building industry in the United Kingdom where it can be argued that the arrangement is a three-party arrangement as opposed to a two-party arrangement.  Mr Law submitted that it was a three-party arrangement in the present case with R3 as gang-leader, who contracted with R1 to provide labour and with A to obtain labour.

36. Mr Albert Yau, counsel for R3, indeed submitted otherwise.

37. To determine the identity of A's employer, it is first necessary to consider whether R3 was doing business on his own account.

38. Ribeiro PJ in the Court of Final Appeal case of Poon Chau Nam (supra) held that in determining whether a person is an employee, the modern approach is to examine all the features of their relationship against the background of the indices of employment with a view to deciding whether, as a matter of overall impression, the relationship was one of employment.  The indicia included the degree of control exercised by the "employer"; whether the person performing the services provided his own equipment; whether he hired his own helpers; what degree of financial risk he took; what degree of responsibility for investment and management he had; and whether and how far he had an opportunity of profiting from sound management in the performance of his task.  His Lordship explained that the exercise involves a nuanced and not a mechanical approach and expressly approved a passage of Mummery J in Hall v Lorimer [1992] 1 WLR 939 at 944,

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

39. In my view, the above principle equally applies to the issue in the present case.

40. It is not in dispute that R3 was first approached by Kwok whereby the steel binding works of the site were taken up by R3, A and Yip.  The price of $25,000 per house was quoted by R3.  The steel bending and cutting machines belonged to R3.  Kwok paid the money due to the steel binding works to R3.

41. The above facts seem pointing to the direction that R3 was running a steel binding business.  Whether he was so doing requires a closer scrutiny of the evidence.

42. R3 kept a record on the steel binding works of the site and another house in the same village ("the project").  It can be seen that R3, A and Yip were working on the project.  Their daily wage was the same, except that R3 earned 2 extra man-days on account of his works on the floor plans (計圖則).  Significantly, the transportation costs of $700 of the steel bending and cutting machines were paid by Kwok.  According to R3's calculation, the total expenditure for the 2 houses was $49,425 and the supposed income was $50,000 ($25,000 x 2).  There should be a surplus of $575.  However, only $30,000 was received from R1.

43. It seems to me that R3 was working on equal footing with A and Yip.  He was paid at the same rate.  His only extra earnings were due to the additional works he was required to do in relation to the floor plans.  To my mind, it is more likely than not that the three of them were working as a team. R3 was the one responsible for keeping an attendance record for each member and to distribute the money received from their employers according to the records. 

44. If R3 was running a business of his own, he did not need to keep his own attendance record for the simple reason that any surplus after the deduction of expenditure would be his profits. 

45. The steel bending and cutting machines were no doubt tools of trade which were belonged to R3.  If R3 had entered into a contract for service with Kwok or R1, it seems odd that he would have required Kwok to pay for the transportation costs of the machines to the site.  In his evidence, R3 said without the machines, it was impossible to do the steel binding works.  But the machines were worthless and could only be sold as scrap metal.  It seems to me that owning the machines was more in the nature of an attraction to prospective village house builders.  Without the machines, the chance of being employed in the market might be lost to those with the machines.

46. Apart from offering his labour force and skill in return for financial gain in the form of daily wages, there is no room for R3 to invest so as to enhance his income.  Likewise, being a manual labour earning a daily wage, there is no room for enhancing his income through sound management in the performance of his work.  In terms of financial risk, it seems that the only risk was not being paid for the works that have been done, which is no difference from the situation of any employee workers.  As R1 had only paid R3 $30,000, both R3 and Yip are suffering a financial loss as a result.

47. Looking at the attendance records of A, he was paid by R3 irregularly both in terms of time and amount.  A was either overpaid or underpaid by R3.  R3 explained that it was because their employers did not pay him on a regular basis.  Whenever he received money from employers, he would distribute the money among themselves.  It is worth noting that the steel binding works at the site commenced on 26 July 2010, but R1 only paid R3 the sum of $30,000 on 17 September 2010, almost 2 months later, which lends support to R3's explanation.

48. If R3 was hiring A as his helper, he is obliged to pay A regularly every month according to the attendance records, no more and no less, and regardless of whether he was paid by his superior contractors or not.  It is not possible to pay A in the manner as he did or else A would either stop working for him or even file a claim for arrears of wages against him.

49. Insurance coverage is an important aspect of the construction industry.  In the event that any of the workers is injured in the course of the works, the employer is liable to pay compensation under the Ordinance, not to mention the potential claim under common law.

50. It is most unfortunate that no insurance converge was taken out in respect of the construction works at the site.  R3 said it was Kwok's responsibility.  Therefore, he specifically asked Kwok if he had already taken out insurance, to which Kwok replied in the affirmative.  Yip's evidence also corroborated those of R3.

51. To my mind, R3's reliance on Kwok's insurance converge is inconsistent with the fact that he was the actual employer of A and Yip.

52. Having considered the evidence in its entirety, it is plain and obvious to me that R3 was not running a steel binding business on his own account.  His role in the work arrangement at the site was acting as a team leader or gang leader of his fellow colleagues, namely, A and Yip.  He was not the employer of either A or Yip.

53. The role of R3 as I find is very similar to the role of the appellant in Wong Sai Yee v Kong Kwan [1988] 1 HKLR 367 who for each accounting period would receive a cheque from the respondent.  He would then pay the workers under him according to their respective output but allowing himself an extra $10 per day for his own technical skill.  The Court of Appeal held that he was the gang leader or foreman.  Like the workers under him, he was also an employee of the respondent.

54. Such being my finding, it must follow and I so find as a fact that A, like R3 and Yip, were employed by R1 through Kwok to do the steel binding works at the site.  I also find that A sustained the injuries while in the course of employment by R1.

Who was the principal contractor in respect of the works A was engaged in at the site?

55. Section 24(1) of the Ordinance provides:-

"(1)  Where any person (in this section referred to as the principal contractor), in the course of or for the purposes of his trade or business, contracts with a sub-contractor for the execution by or under the sub-contractor of the whole or any part of any work undertaken by the principal contractor, the principal contractor shall be liable to pay to any employee employed by that sub-contractor or by any other sub-contractor in the execution of the work any compensation under this Ordinance which the principal contractor would have been liable to pay if that employee had been immediately employed by him ..."

56. Hence, the principal contractor of the construction works at the site is also liable to pay compensation under the Ordinance.

57. A was uncertain as to who was the principal contractor.  His case is that it was either R2 or R4.

58. As a matter of fact, R2 has assumed a dual capacity.  Firstly, he is the sole proprietor of Winli Consulting Engineers ("R2's business").  Secondly, he is the sole shareholder and director of R4.  It can be seen from the titles of R2 and R4 that they bear substantially the same name except that R4 is a limited company.  According to the disclosed documents, R2's business was set up on 1 January 2008 whereas R4 was incorporated on 23 March 2010.

59. In the witness statement of R2, he said that sometime between the end of August and mid September 2009, R4 was engaged by Joy Dragon (HK) Co Ltd ("Joy Dragon") to design the floor plans of a village house to be built on the site.  In the beginning of 2010, R4 entered into a service contract with Joy Dragon ("service contract") whereby R4 would construct the village house at the price of $1,100,000.  In early January 2010, R2 and Kwok entered into an oral agreement whereby R1 promised to build the village house on the site at the price of $970,000 inclusive of insurance coverage.

60. In his evidence-in-chief, R2 sought to distinguish the roles between R2 and R4, that is to say, that R2 was responsible for the drawing of floor plans and other necessary documentation; R4 was responsible for the construction of the village house.  R2 further sought to clarify that the contract between R4 and Joy dragon was signed in July 2010.

61. The service contract consists of 3 pages.  Pursuant to the Order of Deputy District Judge Lawrence Ng made at the pre-trial review on 24 May 2016, R2 explained that when he gave his witness statement in March 2015, he did not have sight of the original service contract.  It was not until early May 2016 when he had sight of the service contract that he discovered that the one disclosed on 9 December 2014 was missing the 3^rd page.  He also discovered from the 3^rd page that it was signed on 21 July 2010, not in the beginning of 2010 as he originally thought.

62. Mr Dennis Law, counsel for A, challenged the authenticity of the service contract. Mr Law also submitted that the service contract as disclosed may not be the actual service contract between R4 and Joy Dragon.  Further, not all cheques drawn by Joy Dragon to R4 were disclosed.  According to the cheques disclosed, Joy Dragon had only paid $742,500 to R4 leaving an outstanding balance of $357,500 on construction costs.  On the other hand, R4 had paid R1 a total of $768,000, thus leaving a balance of $202,000 unpaid.  Mr Law submitted that it is very unlikely that a principal contractor would pay its sub-contractor in such a manner.

63. There is no doubt the service contract was not professionally drafted.  Yet, it contained all the basic specifications of the village house to be built by R4 and also the manner of payment by Joy Dragon.  Indeed, R2 has been equivocal as to when the service contract was signed.  However, it must be remembered that Joy Dragon was required to pay an initial deposit of $110,000 upon the signing of the service contract.  According to the cheques disclosed by R4, Joy Dragon's first cheque in the sum of $110,000 to R4 was dated 20 July 2010[1]. If R4 was not a party to the service contract, there is no reason why Joy Dragon would make payments to R4.  That being so, it is more likely than not that the service contract was entered into in July 2010.  When R2 stated that it was entered into in the beginning of 2010, it must be, and I accept, due to a lapse of memory on his part.

64. Such being my finding, the only inference that can be drawn must be that it was R4 as opposed to R2 who had contracted with Joy Dragon.  This is supported by the fact that Joy Dragon had during the period between 20 July 2010 and 1 November 2011 paid to R4 a total sum of $742,500.

65. On the other hand, during the period from 18 June 2010 and 15 October 2010, R4 had paid R1 a total sum of $768,000 to R1, which supports R4's case that it had sub-contracted the construction works to R1.

66. Although R4 had paid more money to R1 than it had received from Joy Dragon, I think it was a commercial decision that R4 had to make when faced with a non-paying client.

67. For the above reasons, I find that R4 was the principal contractor of the construction works at the site and R1 was the sub-contractor thereof.

Who are liable to pay compensation to A?

68. Due to my findings at paragraphs 54 and 67 hereof, both R1 and R4 are jointly and severally liable to pay compensation to A.

What is the compensation payable under s7?

69. By a Certificate of Assessment in Form 7 dated 7 May 2012, the Employees' Compensation (Ordinary Assessment) Board ("the Board") assessed the loss of earning capacity permanently caused by the injury at 25%.  A objected to the said assessment.  By a Certificate of Review of Assessment in Form 9 ("Form 9") dated 8 February 2013, the Board varied the assessment to 45%.  A appealed against the assessment in Form 9 on 7 March 2013 pursuant to s18(1) of the Ordinance.

70. This court is therefore required to start afresh, relying not only on the certificate of the Board but also any other evidence, especially medical evidence, adduced before it, to assess the loss of earning capacity permanently caused by the injury suffered in an accident at work: see Chu Chin Yiau v Ray On Construction Co Ltd [1992] 1 HKC 246 applying Chan Kit v Sum Wo Industrial Manufactory [1989] 2 HKLR 230.

71. According to the Form 9, the injuries sustained by A were:-

"Spinal cord injury resulting in (i) weakness, incondition and decreased sensation; and (ii) neuropathic bladder and sexual dysfunction"

72. Mr Law, relying on various medical reports, submitted that A has suffered a 100% loss of earning capacity.

73. S7(3) of the Ordinance provides:-

"(3)  For the purposes of this section, permanent total incapacity shall be deemed to result from an injury where the percentage or aggregate percentage of the loss of earning capacity amounts –

(a) in the case of an incapacity of a permanent nature which results from an injury specified in the First Schedule, to 100 per cent or more as specified in that Schedule; or

(b)  in the case of an incapacity of a permanent nature which results from an injury not specified in the First Schedule, to 100 per cent or more as assessed by an Ordinary Assessment Board,a Special Assessment Board or the Court,

and a reference in this subsection to an injury shall include a reference to a combination of injuries whether they are mentioned in paragraph (a) or (b) or in both those paragraphs."

74. Hence, the injuries that A sustained should be considered individually.

Orthopaedic aspect

75. A was examined by Dr Fu Wai Kee, who was jointly appointed by the parties.  Dr Fu opined that the clinical picture of A is compatible with the diagnosis of fracture cervical spine with spinal cord injury.  In view of his present condition with clumsiness and weakness of limbs, he cannot resume to his original work.  Further improvement of limbs power is unlikely.  A carer such as domestic helper will be required.  He should shift to sedentary type duties. Dr Fu assessed that the permanent impairment and loss of earning capacity as a result of the limbs and neck impairments is 45%.

Urological, bowel and sexual aspects

76. A was examined jointly by Dr Kwok Tin Fook and Dr Chu Sai Man Simon.  Dr Kwok was appointed by A whereas Dr Chu was appointed by the respondents.

Dr Kwok Tin Fook

77. Dr Kwok opined that A suffered from urination disturbance (neurogenic bladder), bowel disturbance (neurogenic bowel) and erectile dysfunction, all due to his spinal cord injury.

78. On the urination aspect, A is suffering hyperreflexic bladder with detrusor sphincter days synergic causing some degree of bladder outlet obstruction.  On the bowel aspect, A has lost his bowel sensation and the voluntary power of bowel evacuation.  On the sexual aspect, A has lost completely his sexual power.

79. Dr Kwok assessed A's permanent disability as a result of his spinal cord injury at:-

Urological :	10%
Bowel    :	20%
Sexual  :	10%
Overall  :	37%

Dr Chu Sai Man Simon

80. Dr Chu opined that A has suffered from tetraparesis, erectile dysfunction, bowel and voiding dysfunction.  The symptoms are neurological in origin and are a direct consequence of the neck injury he sustained on 9 October 2010.

81. The voiding symptoms include urgency and urinary frequency with nocturnal enuresis. These symptoms are related to unstable bladder contractions.  There are losses of bowel sensation and sexual function.

82. Dr Chu assessed A's permanent disability as a result of his spinal cord injury at:-

Urological :	15%
Bowel  :	20%
Sexual    :	12%
Overall    :	40%

83. Both Dr Kwok an Dr Chu further referred to the First Schedule of the Ordinance and opined that the loss of earning capacity from his urological condition being:-

Item 47:  Urinary bladder function impairment	20%
Item 48:  Anorectal function impairment	15%

Assessment by specialists in general surgery

84. A was also examined by Dr Book Kwok Shing and Dr Hung Cheung Kin, both are specialists in general surgery.

85. Both Dr Book and Dr Hung, by reference to the American Medical Association Guide to the Evaluation of Permanent Impairment (“the Guide”), 6th Edition, assessed, on top of his spinal disability, A's impairment at:-

Neurogenic bowel resulting in intractable	20%
constipation
Neurogenic bladder management with	50%
occasional intermittent catheterisation
without leakage in between

86. Dr Hung further supplemented that the loss of earning capacity of A based on the First Schedule of the Ordinance is 100%, which consists of the following scheduled injuries:-

Item 7:	Paraplegia	100%
Item 8:	Any other injury causing permanent
	total disablement	100%
Item 47:	Impairment of urinary bladder
	function- poor reflexactivity
	without voluntary control	38-60%
Item 48:	Impairment of anorectal function-
	no reflex regulationand no
	voluntary control	18-25%

87. Dr Hung concluded that after the cervical spine injury, A suffered from paraplegia, permanent disablement in moving the upper limbs, neurogenic bowel and neurogenic urinary bladder.  The accumulated percentage of loss of earning capacity is 100%.

88. On the orthopaedic aspect, there is only the assessment of Dr Fu.  I see no reason to depart from his assessment.

89. However, there are different assessments on the urological, anorectal and sexual aspects.

90. In relation to the urological and anorectal aspects, Dr Hung assessed A's loss of earning capacity by reference to the First Schedule of the Ordinance.  As can be seen in his joint report and supplemental report, his assessments are:-

Impairment of urinary bladder function	50%
Impairment of anorectal function	20%

91. I have difficulties in comprehending the assessment of Dr Kwok and Dr Chu.

92. On the urological aspect, Dr Kwok assessed the permanent disability at 10% whereas Dr Chu’s assessment is 15%.  However, when the First Schedule of the Ordinance was referred to, the loss of earning capacity has become 20%.

93. On the bowel aspect, they both assessed the permanent disability at 20%.  However, the assessment has become 15% when the First Schedule of the Ordinance was referred to.

94. On the other hand, the assessments of Dr Hung by using the Guide and by reference to the First Schedule of the Ordinance are consistent with each other.

95. I prefer the assessments of Dr Hung and see no reason to differ from them.

96. In respect of the sexual aspect, Dr Kwok assessed at 10% and Dr Chu assessed at 12%.  I would prefer the lower assessment at 10%.

97. On the whole, the aggregate percentage of the loss of earning capacity which resulted from the injury exceeds 100% (45% + 50% + 20% + 10%).  In accordance with s7(3) of the Ordinance, therefore, A is deemed to have suffered permanent total incapacity.

98. Prior to the accident, A's daily wage was $950 and was working for about 17 days per month.  His average monthly earning was $16,500.  At the time of the accident, A was 60 years old, the multiplier under s7(1)(c) is 48. 

99. The compensation payable under s7 of the Ordinance is:-

  $16,500 x 48 = $792,000

What is the compensation payable under s8 of the Ordinance?

100. S8(1) of the Ordinance provides:-

"(1)   Where permanent incapacity which results from the injury is of such a nature that the employee is unable to perform the essential actions of life, without the attention of another person, the compensation payable under this section for and in relation to such attention shall, in addition to any compensation payable under other provisions of this Ordinance, be--

(a)  such amount not exceeding the amount specified in the second column of the Sixth Schedule shown opposite section 8(1)(a) specified in the first column of that Schedule as the Court considers necessary to meet the cost of such attention; or …"

101. Dr Fu was of the opinion that prognosis for neurological recovery of A is poor.  Further improvement of limbs power is unlikely.  A will need assistance in activities of daily living.  Therefore, a carer such as domestic helper will be required for the rest of his life.

102. A is now aged 66.  The statutory limit under the Sixth Schedule of the Ordinance is $511,770.  I am satisfied that the actual costs of employing a domestic helper to take care of the daily life of A for the rest of his life would exceed the statutory limit.

103. Therefore, the compensation under s8 is $511,770.

What is the compensation payable under s10 of the Ordinance?

104. According to Form 9, A was given sick leave from 9 October 2010 to 28 January 2013, which is more than 2 years.  Such period of sick leave should be allowed as the period during which A was entitled to periodical payments under s10 of the Ordinance.

105. The compensation under s10 of the Ordinance is:-

  $16,500 x 27months 20 days x 4/5 = $365,112

What is the compensation under s10A of the Ordinance?

106. A stated that he has incurred medical expenses in the sum of $20,000, which is not challenged, and I so allow.

Advanced payment

107. It is not in dispute that A has received advanced payment in the sum of $129,000.

Conclusion and order

108. For the foregoing reasons, I order that R1 and R4 shall jointly and severally pay A compensation in the sum of $1,559,882, which is made up of the following sums:-

(1)   s7 compensation	$792,000
(2)   s8 compensation	$511,770
(3)   s10 compensation	$365,112
(4)   s10A compensation	$20,000
Sub-total:	$1,688,882
LESS:  advanced payment	$129,000
Compensation payable:	$1,559,882

Interest

109. A is entitled to interest at half judgment rate from the date of the accident (ie 9 October 2010) to the date of judgment and thereafter at judgment rate until the date of payment.

Costs

110. I make a costs order nisi that R1 and R4 shall pay A the costs of these proceedings, to be taxed if not agreed, with certificate for counsel.

111. I also make a costs order nisi that A shall pay R2 and R3 costs of these proceedings, to be taxed if not agreed, with certificate for counsel.

112. A's own costs shall be taxed in accordance with Legal Aid Regulations.

113. In the absence of any application by summons to vary the same within 14 days from the date of this judgment, the orders nisi shall become absolute.