Chan Kai Man v. Baiqian International Holding Ltd
Read the full judgment text of DCEC 1612/2012 on BabelCite. This District Court judgment was delivered on 28 October 2016.
1. By an order made by Master J Chow on 28 May 2015, it was directed that the trial of DCEC 1612/2012 (the “EC Action”) and the trial of DCPI 660/2013 (the “PI Action”) were to be heard together before a bilingual judge. The EC Action and the PI Action were heard by this court for six days in December 2015 as described above. Time was then allowed to the parties to prepare their respective closing submissions in writing which were subsequently submitted to this court by the respondent/defendan
Cited by 2 cases · Cites 4 cases
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DCEC 1612/2012 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION EMPLOYEES’ COMPENSATION CASE NO 1612 OF 2012 --------------------
-------------------- DCPI 660/2013 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION PERSONAL INJURIES ACTION NO 660 OF 2013 --------------------
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-------------------- JUDGMENT -------------------- BACKGROUND 1.By an order made by Master J Chow on 28 May 2015, it was directed that the trial of DCEC 1612/2012 (the “EC Action”) and the trial of DCPI 660/2013 (the “PI Action”) were to be heard together before a bilingual judge. The EC Action and the PI Action were heard by this court for six days in December 2015 as described above. Time was then allowed to the parties to prepare their respective closing submissions in writing which were subsequently submitted to this court by the respondent/defendant on or about 28 January 2016 and by the applicant/plaintiff on or about 4 February 2016, followed by supplemental submissions by the respondent/defendant on 5 February 2016. 2.The applicant/plaintiff in these actions is Mr Chan Kai Man （陳解文）(“Chan”). It is the case of Chan that he was at all material times in the employ of Baiqian International Holding Limited（百千國際集團有限公司）(“BQIH”), the respondent/defendant herein, as a Hong Kong–China cross-border lorry driver and that he suffered back injuries in an industrial accident when he was unloading goods in Hong Kong in the course of his employment on 2 August 2012 (“the Accident”). It is also the case of Chan that his employment was terminated on 4 August 2012 and the key to the lorry assigned to him and the official cross-border driver document were taken back from him on 5 August 2012 by BQIH. Chan alleges that he has suffered loss and damages as a result of his injuries. 3.BQIH denies any employment relationship as alleged by Chan or at all. It alleges that Chan’s employer at all material times was a Mainland China business entity known by the name of 深圳市深聯運國際貨運代理有限公司（“深聯” or “SLY”）. It does not admit and puts Chan to strict proof that any accident happened in the course of Chan’s employment as alleged or at all. BQIH also alleges that it was not the duty of Chan to load or unload the cargoes; that the Accident did not result from a risk which was necessarily incidental to the performance of Chan’s duties; that Chan’s injuries were attributable to the serious and wilful misconduct of Chan; and that there is no or no sufficient causal connection between the Accident and Chan’s employment. BQIH further alleges Chan quitted his employment with SLY by returning his lorry key and the official cross-border driver document to SLY through one of his colleagues on 5 August 2012. 4.At the trial of these actions, only Chan himself gave evidence to prove his own case. No other witnesses were called to give evidence in support of Chan’s case although there was included in the trial bundles the witness statement of one Mr Tsang Kwok Ming（曾國明）(“Tsang KM”). However, Tsang KM was not called to give evidence at the trial. Chan explained when he was giving his oral evidence at the trial that Tsang KM was not called as a witness because he asked for HK$2,000 for giving evidence at this trial. Since it was not sought on behalf of Chan to put in the witness statement of Tsang KM as evidence at the trial, it is not necessary for this court to consider its contents. 5.On the other hand, BQIH called the following three witnesses to give evidence at the trial in support of the defendant’s case:-
THE ISSUES 6.The main issues on liability in the EC Action and the PI Action largely overlap and can be summarized as follows:-
WHO WAS CHAN’S EMPLOYER? 7.Section 2(1) of the Employees Compensation Ordinance, Cap 282 (the “ECO”) provides a definition of “employee” as follows:-
8.The issue of whether a person is an employee of another is a question of fact to be determined by the court which looks at the substance of the relationship rather than the label attached to it by the parties. 9.Both Chan’s counsel and BQIH’s counsel in their respective opening submissions referred this court to the judgment of the Hong Kong Court of Final Appeal in Poon Chau Nam v. Yim Siu Cheung t/a Yat Cheung Air Conditioning and Electric Co (2007) 10 HKCFAR 156. Though the issue placed before the Court of Final Appeal is whether the applicant in the employees’ compensation proceedings was an employee or an independent contractor of the respondent, the principles enunciated by the Court of Final Appeal in the Poon Chau Nam case are relevant and applicable to the instant case before this court. 10.In paragraphs 9 and 18 of the judgment, the Court of Final Appeal says:-
11.Mr Jerome Liu, counsel for Chan, also referred this court to the case of Shen Li Ping (for herself and for and on behalf of other members of the family of Tsang Kwok Kwong, deceased) v Oriental Logistics Group Limited, unreported, DCEC 987/2010, 25 October 2012. In the Shen Li Ping case, Madam Shen was the applicant in an application for compensation under the ECO in relation to the death of her late husband Mr Tsang Kwok Kwong arising out of a fatal accident happened in December 2008 when Tsang was driving a 10-ton cross-border container truck and bumped into the rear of another truck. Oriental Logistics Group Limited, a company incorporated in Hong Kong, was the respondent in the proceedings. Oriental Logistics disputed liability and alleged that Tsang was employed by a PRC company known as Max Dart Technology Logistic Co Ltd located in Dongguan. Madam Shen and Oriental Logistics referred to and relied on different documents in support of their respective contentions. Some documents pointed more to Oriental Logistic as Tsang’s employer whilst other documents pointed more to the PRC company Max Dart as the employer. Madam Shen relied on a number of documents that were said to have the cumulative effect of proving that Oriental Logistics was the employer of Tsang. Such documents included: (1) the vehicle registration document showing that Oriental Logistics was the registered owner of the truck driven by Tsang; (2) a table bearing the letterhead of Oriental Logistics titled as “Drivers Contact Details”（司機聯系資料表）showing the assigned trucks and the contact details of different drivers including Tsang; (3) a table bearing the letterhead of Oriental Logistics showing details of calculation of the salary of Tsang for December 2008; (4) an insurance policy issued in August 2008 showing Oriental Logistics insured against the relevant truck in accordance with PRC regulations; and (5) a table bearing the company stamp of Oriental Logistics with GPS record showing the movement of Tsang’s truck for each stop of the journey on the day of the accident and the day before. On the other hand, Oriental Logistics relied heavily on the “personnel registration card”（人事資料卡） of Max Dart dated 10 October 2008 to suggest that the employment relationship was between Tsang and Max Dart. Having heard the witnesses and considered the relevant documents, the trial judge in the Shen Li Ping case took the view that the cumulative effect of the relevant documents suggested that Oriental Logistics was the employer of Tsang. 12.In the present case, it appears that the following factors and materials are the more relevant ones in determining the identity of the Chan’s employer:-
(A) The newspaper advertisement, the interview, the circumstances under which Chan was offered the job, and the terms and conditions of the employment 13.Chan was at all material times a Hong Kong resident who was born in Mainland China in 1956. According to Chan, he came across a job advertisement for several positions of Hong Kong-China cross-border lorry driver on a Hong Kong local newspaper, namely the Oriental Daily, in or about mid-September 2011. The documents included in the trial bundles of the EC Action at pages 325-333 show that the relevant advertisement was published on 15 September 2011 and the advertisement says as follows:-
14.The newspaper advertisement stated that the employer was recruiting several China-Hong Kong drivers for cross-border express dispatch and custom clearance in Shenzhen Airport. It offered a monthly salary of HK$16,000.00. Other benefits included Mandatory Provident Funds (“MPF”) and Employees’ Compensation Insurance. Interested applicants were asked to contact a Mr Tsang by phone. 15.Chan therefore rang to the telephone number as advertised to apply for the job. He was asked to attend an interview on a Saturday in mid-September 2011. 16.The interview took place at a venue situated at Unit B, 9/F, Kwai Wan Industrial Building, No 2 Wing Kin Road, Kwai Chung, NT, Hong Kong (“Unit 9B”). Unit B was at all material times the registered office of BQIH as shown by the Notice of Change of Address of Registered Office filed on behalf of BQIH on 11 February 2011. 17.According to Chan, he was interviewed by Tsang KM who gave him his business card during the interview. From a copy of such business card included in the trial bundles, one can see the following information printed on it:-
18.It is said by Chan that Tsang KM introduced himself to Chan as the manager of BQIH. Chan also said that the following things happened during the interview:-
19.The story of BQIH on this part was mainly covered by the evidence of Tsang SC. He said that he was the manager of BQIH at the time of the alleged Accident on 2 August 2012. It is also his evidence that he joined SLY in January 2011 and was transferred to BQIH in May 2012. He further said that he left the employ of BQIH in around April 2013 and that he was no longer an employee of BQIH at the time of the trial of the proceedings herein. 20.In his cross-examination, Tsang SC said that BQIH did not have any particular business at the time when he was transferred from SLY to BQIH in around May 2012 save for renting out lorries to SLY. He further said that before his transfer to BQIH, there were then only 4 employees in BQIH, namely, Ting Ting（婷婷）, Ka Yee（嘉儀）, Chan Wai Wah（陳偉華）and Ah Sui（阿水）. 21.Tsang SC said that Tsang KM was never an employee of BQIH. He said that Tsang KM and Liao EH (ie a major shareholder of BQIH) were in similar line of business. They had some kind of business arrangements previously in that high-valued goods were handled by Tsang KM and low-valued goods were handled by BQIH. Tsang KM and BQIH shared the same industrial property as their business premises. However, the said business arrangements ceased at around the time when Tsang SC was transferred from SLY to BQIH in April or May 2012. 22.Tsang SC tried to explain the recruitment advertisement by alleging that:-
23.Chan did not have much education. He was born in Mainland China in 1956. He received education in Mainland China up to level 5 in primary school. Counsel for BQIH referred this court to the evidence of Chan in the Magistracy Case No KTS 1743-57 of 2013 (“the MPF Case”) and submitted that Chan was an unreliable witness. It appears from the transcript of the MPF case that a total of 15 summonses were laid against BQIH for offences under the Mandatory Provident Fund Schemes Ordinance (Cap 485) in connection with Chan’s Mandatory Provident Fund (“MPF”) account. These 15 summonses could be grouped into four categories: (1) the first summons alleged that BQIH failed to arrange for Chan to become a MPF scheme member within the time stipulated by law after Chan had become an employee of BQIH; (2) the second to fifth summonses alleged that since BQIH had failed to arrange for Chan to become a MPF scheme member within time it therefore failed to make MPF contributions for Chan as required by the law; (3) the sixth to thirteenth summonses alleged that BQIH had failed to make any or any sufficient contributions to the MPF scheme after Chan had been registered as a MPF scheme member; and (4) the fourteenth and fifteenth summonses alleged that the respective commencement date and termination date of Chan’s employment with BQIH were incorrect and false. A central issue common to all these 15 summonses was whether BQIH was the employer of Chan. Chan was called to give evidence in the MPF Case as one of the prosecution witnesses. Three other witnesses were called to give evidence as prosecution witnesses of which two were employees of an agency hired to render administrative support services to the relevant MPF scheme to which Chan had been registered as a member by BQIH, and the remaining prosecution witness was an employee of the Mandatory Provident Fund Schemes Authority (“the MPFA”). BQIH called no witness to give evidence in the MPF Case, an approach that it was entitled to adopt and no adverse inference could be drawn against it by the trial magistrate. Mr Lam, counsel for BQIH in the present proceedings, was also retained to act for BQIH in the MPF Case. When the prosecution case was closed, a submission of no case to answer was made by Mr Lam. The trial magistrate ruled that there was a case to answer, though he acquitted BQIH of all the 15 summonses at the end of the trial. The main reason for the acquittal was that the standard of proof required for a conviction was “beyond all reasonable doubt” and after considering all the evidence available to the court the magistrate was not so satisfied. According to the transcript of the MPF Case, there were a number of reasons why the trial magistrate was not satisfied beyond all reasonable doubt that BQIH was guilty as summonsed. One of the reasons was that Chan appeared to have confusion as to the identity of his employer. Under his examination-in-chief in the trial of the MPF Case, Chan at first confirmed that his employer was “百千國際物流有限公司” (“BQ Logistics”) but subsequently claimed that the name of his employer should be that of BQIH. Under cross-examination, when being asked whether Tsang KM was acting for BQIH, SLY, or BQ Logistics when he conducted the job interview, Chan said that he did not know. For these reasons alone, the trial magistrate was of the view that he could not be satisfied beyond all reasonable doubt that BQIH was the employer of Chan in the trial of the MPF Case. It is noted that besides stating that he was not satisfied beyond all reasonable doubt and noting the confusion in the identity of the employer in the evidence of Chan, the trial magistrate did not make any finding that Chan was an unreliable witness. To the contrary, the trial magistrate did make some adverse comments against BQIH in the oral reasons delivered by him by saying that the position or conduct of BQIH was “非常可疑” (very suspicious). 24.In connection with the acquittal of BQIH in the MPF Case, Mr Jerome Liu of counsel for Chan referred me to a passage in the judgment of Lord Diplock in Hunter Appellant v Chief Constable of the West Midlands Police and Others [1982] AC 529 at 543 A-C in which His Lordship summarized the approach to be adopted in a subsequent civil proceedings when dealing with the conviction or acquittal in an earlier criminal case in the following way:-
I agree with the approach adopted by Lord Diplock. 25.Chan had received little education and is not a sophisticated person. Though he is not the best witness by any standard and his recollection of events may not be perfect, he has been very consistent with his account concerning the detailed particulars of the interview with Tsang KM, the circumstances under which he was given the name card of Tsang KM, his meeting with Tsang SC in a restaurant in the vicinity of the Huanggang Port and the matters discussed at such meeting, etc. His story was unshaken under the vigorous cross-examination by Mr Lam, counsel for BQIH. 26.On the other hand, I notice that Tsang SC is obviously a more sophisticated person than Chan, but I also observe that he was less than frank when he was giving his evidence at the trial. He avoided questions by counsel from time to time by giving ambiguous answers or irrelevant answers. He gave me the impression that he had something to hide and that he was not a reliable witness. There are clearly inconsistencies in his story about the relationship between BQIH and Tsang KM. Take the issue of the business name card of Tsang KM as an example. In his supplemental witness statement (para 22), Tsang SC said that during the period of cooperation between BQIH and Tsang KM, the former allowed the latter to use its name and its business address and to print the same on his business name cards in order to facilitate the execution of those business duties covered by their business cooperation such as liaison and communication with the Hong Kong customers of BQIH. In short, according to the evidence of Tsang SC as contained in his supplemental witness statement, Tsang KM printed his own BQIH business name cards with both the knowledge and the authority of BQIH. However, when Tsang SC was giving oral evidence in court he tried to retract his committed position by saying that the business name card was probably printed by Tsang KM himself in Hong Kong and he was not sure if Tsang KM had been authorized to do so. The story that Tsang SC had been trying very hard to tell this court is that Tsang KM was never an employee of BQIH. Nor was he authorized to conduct the interview with Chan, make any offer for employment to Chan or enter into any oral or written employment agreement with Chan. 27.I find it very hard to follow or accept the story told by Tsang SC that since SLY was a business entity in Mainland China it was unable to place advertisement on newspaper in Hong Kong. Hence SLY had to get the assistance of BQIH which in turn asked Tsang KM to help by placing the job recruitment advertisement and using his own mobile phone number for contact by interested job applicants. I find that the story told by Tsang SC defies common sense and is inherently implausible. I do not accept his story that it is not possible for a Mainland business entity to place advertisement on newspaper in Hong Kong. In fact, Tsang SC admitted under cross-examination that SLY itself had never tried to place job recruitment advertisement on Hong Kong newspapers direct. Further, even if SLY really needed someone in Hong Kong to help placing newspaper advertisement, Tsang SC would be an obvious choice since, according to him, he was then still an employee of SLY and he is a Hong Kong resident. Alternatively, there were then several full time employees working for BQIH in Hong Kong. These employees, instead of Tsang KM if he was not an employee of BQIH as alleged by Tsang SC, should also be the most obvious persons whom SLY could and should have approached for assistance. This is particularly so bearing in mind the fact that, although SLY and BQIH were two separate legal entities in Shenzhen and Hong Kong respectively, they were closely associated with each other in terms of their common shareholders, business structure and business operation. For example, there was significant overlap in the shareholders and senior management of these companies in that Liao EH, who was then holding 5,000 of the 10,001 shares issued (being 49.995% of the shares issued) in BQIH and 34% shareholding in SLY, was also the “legal representative”（法定代表人）of SLY, and that his brother Liao MH, who was similarly holding 5,000 of the 10,001 shares issued (being 49.995% of the shares issued) in BQIH and 33% shareholding in SLY, was the sole director of BQIH. It is therefore unbelievable that SLY (assuming that it was the prospective employer of Chan) would have gone all the way to get an outsider like Tsang KM to help if he was not an employee of SLY or BQIH. 28.In connection with the issue of whether Tsang KM was a manager of BQIH, Tsang SC had confirmed to the Presiding Officer of the Labour Tribunal in Claims No LBTC 4545 of 2012, a claim brought by Chan against BQIH under the Employment Ordinance (Cap 57), at a hearing held on 8 January 2013 that Tsang KM was previously a manager of BQIH but his employment had ceased already. At p 3 G-J of the transcript (of which a copy can be found at p 719 G-J of the trial bundle of the EC Action), it is recorded as follows:-
29.Tsang SC also suggested that the monthly salary of HK$16,000.00 as described in the newspaper advertisement was put down by Tsang KM without the knowledge or consent of SLY or BQIH. I find it difficult to follow or accept such suggestion since there is simply not any conceivable explanation as to why Tsang KM would have done so if such figure had not been prescribed by SLY or BQIH beforehand. 30.On the basis of the matters discussed above, I prefer Chan’s account to that of Tsang SC concerning the newspaper advertisement, the interview, the circumstances under which Chan was offered his job, and the terms and conditions of his employment. These factors alone suggest that BQIH rather than SLY was the employer of Chan at all material times. (B) Ownership of the lorry 31.It is common ground that the Lorry was owned by BQIH. This fact tends to add weight to the view that BQIH rather than SLY was the employer of Chan. 32.The evidence of Chan and documents produced on his behalf shows that:-
33.The evidence of BQIH on those issues mentioned above was covered mainly by the evidence of Tsang SC. The gist of his evidence is that:-
(C) Documents Signed Between Chan and His Employer and Documents Received From BQIH and SLY 34.BQIH relies heavily on two Chinese documents in support of its contention that Chan was employed by SLY instead of BQIH. These two Chinese documents are:-
35.In the Work Duties Agreement, SLY was named as Party A and Chan was named as Party B. Party A was described as the “Company” and Party B was described as the “Employee”. The document was purported to have been signed by both parties on 18 October 2011. The following interesting features are noted on the face of the Work Duties Agreement:-
36.Despite the features I mentioned in the preceding paragraph, the Work Duties Agreement is a document which seems to suggest there was some kind of relationship, including the possibility of some kind of employment relationship, between Chan and SLY. 37.Regarding the Work Duties Agreement, it is the evidence of Chan as contained in paragraph 13 of his supplemental witness statement that when he signed on the document he did not see any name or stamp of SLY or any signature of its representative on the document. It is also his evidence that he passed the document to the responsible staff member immediately after he had signed on it and he did not see anyone writing down the name of SLY or affixing SLY’s stamp or signing on the document at that time. Under cross-examination, Chan explained that when he was asked to sign the Work Duties Agreement by a Miss Poon, he was told that it was some kind of agreement with the Custom Department undertaking not to involve oneself in smuggling activities. 38.On this issue, it is the oral evidence of Tsang SC that:-
39.Liao ER (DW2), who was and is the “legal representative” of SLY and a major and substantial shareholder of BQIH, was also asked about the Work Duties Agreement during his cross-examination. He was given the opportunity to comment on Chan’s story. However, Liao ER only said that such document was made by the Human Resources Department and the requirement was to have names inserted. He did not refute or reject Chan’s story as implausible or unbelievable. Liao ER was then further shown Exhibit D1, which is a one-page employment contract of SLY in Chinese bearing the Chinese title of “聘用確認書” (Confirmation of Employment Agreement). The space marked “公司名稱” (“Name of Company”) on the top right hand corner of the document was left blank without inserting the name of SLY or any other company. The document was signed by the employee, bore the red stamp of SLY but was not signed by SLY; nor was the document dated. Liao ER gave the unconvincing answer that it did not matter so long as the document bore the red stamp of SLY. 40.In so far as the Employee’s Personal Particulars Form is concerned, Chan explained in his supplemental witness statement that the document was actually a two-page document with front side and back side in that on the front side there was the Employee’s Personal Particulars Form whilst the back side bore the form in Chinese entitled “員工誠信申明書” (“Employee’s Declaration of Interest”). Chan’s story is the same as that for the Work Duties Agreement. It is also his evidence under cross-examination that when he was asked to sign on it he was told that he should provide the telephone number of a contact person in case he should meet with any emergency or accident. As a result, he wrote down the mobile phone number of his son on the Employee’s Personal Particulars Form. 41.Having considered all the evidence available, it is clear that there is no evidence from BQIH’s witnesses to contradict that of Chan. I find Chan’s story not implausible in that when he was asked to sign on these documents, neither the name of SLY nor the stamp of SLY appeared on the form, and that these information were only filled out by someone after these forms had been signed and submitted by Chan. Alternatively, even if these information had already been written down on the forms when Chan signed on them, he probably would not have noticed them or realized their potential importance since he had been given to understand by Tsang KM that BQIH was his employer and that these company names might not matter much as he, by then, had already seen so many different company names, including “bp”, BQIH, “BQ LOGISTICS” and “威盛運輸企業有限公司”, printed on the business name card of Tsang KM and the body of the Lorry. This is particularly so bearing in mind Chan’s relatively low level of education and my earlier finding that he is not a sophisticated person. (D) Payment of wages to Chan by his employer 42.It is common ground that Chan was paid his salaries and his mobile phone allowance in cash on the 15th day of every month. Other relevant expenses were also paid on reimbursement basis two to three times in every two months. 43.According to Chan, payments were made in Hong Kong dollars to him by the Cashier known as “紅姐” (“Madam Hung”) at the Shenzhen Address printed on the business name card of Tsang KM. 44.It is the evidence of Liao YF DW3 that salaries of the Hong Kong-China cross-border drivers were usually paid on the 15th day of each month at the registered office of SLY, namely Room 310 at the Shenzhen Address. The salary records of all the drivers were consolidated and printed on a standard form of SLY on a monthly basis. Liao YF said that each one of these monthly forms would bear the Chinese title of “深圳市深聯運國際貨運代理有限公司” followed by the words of “201x年xx月工資表” at the top and the names and signatures of the officers who prepared, checked and approved the form at the bottom. She further explained that due to privacy reason, she or other colleagues of the finance department would cover those entries concerning other drivers with paper strips but leaving the heading of the form at the top, and the names of the officers at the bottom, and the relevant entry in respect of the driver who was collecting his salaries visible to him when he signed on the form upon receiving his salaries. 45.The story of BQIH was disputed by Chan. His story is that the Shenzhen Address is a 3-storey warehouse structure. He had been instructed to drive the Lorry to there for loading and unloading goods. He noticed that there was a name plate bearing the company name of Baiqian put up at the main entrance of the building. Chan further said that starting from January 2012 onwards the salary record form was folded up in such a way that only the particular entry pertinent to his salary was revealed to him for his signature. Thus, he did not know whether the name of SLY was printed on the salary record form or not. As for the period before January 2012, Chan said that the record was not folded up or covered in any way and he could see the whole documents and all the other entries concerning the other drivers. He was certain that the name of SLY was not printed on the form. 46.Having heard Liao YF and seen her giving evidence in court, I do not find her to be a frank, honest or reliable witness. She was very evasive when answering questions put to her by Chan’s counsel. She was particularly evasive and trying hard to avoid the questions when she was asked by Chan’s counsel on issues such as whether SLY actually paid BQIH to reimburse the latter of the MPF contributions allegedly made by BQIH on behalf of SLY in respect of Chan’s MPF account, and whether SLY had filed any document with the Shenzhen government concerning SLY’s alleged employment of Chan. She said that these matters were not within the ambit of her work and duties. On a number of other issues, she tried to avoid counsel’s questions by saying that she did not understand the questions, giving answers not relevant to the questions, claiming she did not remember or claiming that she had no knowledge of the matter or that the matter was handled by other colleagues, etc. 47.I do not accept the account of Liao YF as to how the salary record form was presented to Chan and the other drivers for their signature. The method as described is so clumsy and awkward that I can hardly imagine any person in his right mind would have adopted in practice. Nor do I accept the story told by Liao YF that she had been instructed by her supervisors that the drivers had to be shown the top part of the form printed with the name of SLY and the month to which the form referred, and the bottom part showing the names and signatures of the officers who prepared, checked and approved the form. 48.The fact that I rejected the evidence of Liao YF concerning the salary record form does not necessarily mean that I must accept the account of Chan on the issue. Whilst I accept Chan’s evidence that since January 2012 the salary record form was folded up in such a way that only the particular entry relating to his own salary was revealed to him for his signature, I doubt, and therefore do not accept, that he would be able to recall with the degree of certainty he asserted that the name of SLY did not appear on the form at such time when the identity of his employer would not appear to have any significance to him. Even if the name of SLY was printed on the salary record forms and revealed to Chan when he signed to acknowledge receipt of his salaries, he probably would not have noticed it or came to the view that his employer was SLY instead of BQIH, particularly bearing in mind the fact that Chan is not a sophisticated person. In any event, whether the name of SLY was printed on the salary record form and whether Chan could and should have notice of it are only one of the many factors that this court would take into account when deciding whether there was any employer-employee relationship between Chan and BQIH at the material times. (E) Mode of operation, sources of instructions, and supervision of work 49.Regarding the mode of operation, the sources of his instructions of work and the supervision of his work, the evidence of Chan can be summarized as follows:-
50.Tsang SC attempted to answer and deal with Chan’s case in paragraphs 27 to 30 of his supplemental witness statement as follows:-
51.It is noticed that Tsang SC did not deny Chan’s account that the aforesaid notice dated 18 November 2011 was given to him by employees of BQIH. 52.Liao EH said in paragraphs 17 to 21 of his supplemental statement that:-
53.In the oral evidence of Tsang SC, he tried to paint a picture that all the instructions for the loading and unloading arrangements for the 7 lorries owned by BQIH and leased to SLY were given by staff of SLY in SLY’s Shenzhen office and that staff members of BQIH in Hong Kong were also informed of such instructions so that they could relay the same to the drivers. In his cross-examination by Chan’s counsel, Tsang SC said that staff members of BQIH did not have much involvement in respect of the co-ordination work of the drivers and that it was only in some unexpected situations, which were infrequent, that assistance from the staff members of BQIH would be required. 54.If what Tsang SC said is true, one can hardly imagine why BQIH would need to have 5 employees in its Hong Kong office at Unit 9B when it is also the evidence of Tsang SC that BQIH did not have any business other than renting its lorries to SLY. 55.Having considered all the relevant evidence, I reject the story of Tsang SC and I find that BQIH was actively involved in the management and co-ordination of the work of the cross-border drivers including Chan. It appears rather clearly from the evidence that operations in Hong Kong were controlled by employees of BQIH from Unit 9B whilst operations in Shenzhen were controlled by people at the Shenzhen Address, whether it was part of BQIH, SLY, or BQ Logistics. (F) The Mandatory Provident Funds Issue 56.In Hong Kong, there is in place the Mandatory Provident Fund scheme (the “MPF”) which is a compulsory saving scheme for the retirement of residents in Hong Kong. Under the MPF scheme, an employee and his employer are required to contribute 5% of the employee’s relevant income as mandatory contributions for and in respect of the employee to a MPF scheme provided by an approved private organization selected by the employer subject to a maximum relevant income level for contribution purposes. In this connection, the employer is required to set up a MPF account for the employee with the selected MPF provider within 60 days of the employee’s employment. 57.In the present case, it is common ground that BQIH had set up a MPF account with an approved MPF provider for Chan during the period when he was working as a cross-border lorry driver albeit such account was set up late and not until sometime in January 2012 and only for a monthly contribution of HK$325.00 from each of BQIH and Chan, which sum was apparently calculated with reference to the “Minimum Relevant Income” of HK$6,500.00 stipulated by law during the period between 1 November 2011 and 31 May 2012 and that sum “Minimum Relevant Income” was far below the amount HK$16,000.00 basic salary actually earned by Chan back then. The apparent breach of the relevant MPF legislations by BQIH resulted in a total of 15 summonses being laid against it in the MPF Case discussed above. 58.Chan first made reference to the MPF issue in paragraphs 26 to 28 of his witness statement filed in the EC Action on 22 August 2013 and filed in the PI Action on 22 October 2013. Chan enclosed a document which is a standard form document of AXA and bearing the title “Application for Membership – Employee” (the “MPF Application Form”). The MPF Application Form is a document for setting up a MPF account with the AXA MPF scheme. Chan was named as the applicant in Part B of the form. Part A was stated “To be completed by Employer” and the name of BQIH was named under this part as Chan’s employer. The backside of the document contains a declaration and it was signed by both Chan and BQIH on 3 January 2012. Tsang SC confirmed that the signature of the employer belonged to Liao MH, who was the major and very substantial shareholder and the sole director of BQIH. 59.Chan filed a supplemental witness statement in both the EC Action on 17 December 2014 and in the PI Action on 6 January 2015. In paragraph 9 of his supplemental witness statement, he made a very short reference to the MPF issue by saying that it was his understanding the MPF was only available in Hong Kong but not in PRC and that since the job recruitment advertisement mentioned MPF as part of the remuneration package he knew that the relevant company was a Hong Kong company. 60.A number of witness statements and supplemental witness statements of the three defence witnesses had been filed on behalf of BQIL. According to these witness statements and supplemental witness statements, BQIH’s case on the MPF issue runs like this:-
61.Under cross-examination, Liao EH further added that,
62.These reasons as said by Liao EH during his cross-examination were something new in the case of BQIH. They were never said by any of the defence witnesses in any of the witness statements previously filed. In fact, it was inconsistent with what he said earlier in his witness statements. It also contradicted what Tsang SC said in his witness statements and at the trial about the MPF issue. 63.It appeared that solicitors acting for Chan had written to the MPF Authority (“MPFA”) by letter of 14 July 2014 for making an enquiry. The MPFA replied by a letter dated 24 July 2014 (the “MPFA Letter”). In the 3rd paragraph, the MPFA says:-
64.Under cross-examination, Tsang SC tried to dissociate himself from the MPF matters by conceding that he had not liaised with local MPF providers to explore the possibility of enrolling the Hong Kong-China cross-border drivers into a MPF scheme; he was not sure whether people of the Personnel Department of SLY had ever checked with any MPF providers regarding the matter. When he was cross-examined on what he said in his witness statement that SLY borrowed the name of BQIH as Chan’s employer for enrolling Chan into a MPF scheme, Tsang SC retracted and claimed that he had no personal knowledge of the MPF matters and arrangements. He also contradicted himself on the contents of the recruitment advertisement in particular as to whether Tsang KM should or was authorized to put down his mobile phone number in the advertisement. 65.The MPF Application Form is an important document relating to the MPF issue. It is signed by Liao MH. On the face of the MPF Application Form, BQIH was the employer of Chan during the relevant period. There is at least, if not more than, a prima facie case suggesting that BQIH was Chan’s employer. However, Liao MH was not called to give evidence. There is no suggestion that Liao MH cannot be called to give evidence at this trial. Nor is there any explanation given by BQIH as why Liao MH has not been called to give evidence. When Liao EH was asked under cross-examination whether there was any reason for Liao MH not giving evidence at this trial, he answered that he did not know but he confirmed that Liao MH knew about this trial. In these circumstances, this court is entitled to draw adverse inference against BQIH at least on the MPF issue in the way as enunciated by the Hon Johnson Lam J. (as His Lordship then was) in Ip Man Shan, Henry v Ching Hing Construction Co Ltd, unreported, HCA 3675/1985, 15 January 2003, if necessary. 66.Further, it is my observation that the defence witnesses, in particular Tsang SC and Liao EH, were very evasive when they were being cross-examined on the MPF issue. Both of them were changing their story as they moved along. As such, the evidence of the defence witnesses is unreliable and cannot be trusted. I do not accept that BQIH arranged MPF for Chan for and on behalf of SLY as alleged. I also do not accept BQIH’s story and the evidence of Tsang SC or Liao EH that arrangements were made between SLY and BQIH to enroll Chan into a MPF scheme because he was not eligible to participate in the NSSF as alleged or at all. I find that the defence witnesses were not telling the truth on the MPF issue. All the three defence witnesses were unreliable witnesses. I particularly reject the evidence of Liao EH which was full of blatant lies. I accept the MPF Application Form is prima facie evidence in support of Chan’s contention that BQIH was his employer. (G) The companies are all related/associated companies and not truly independent business entitles 67.Besides BQIH and SLY, the names of “百千國際物流有限公司” (“Baiqian International Logistics Limited Company” or “BQ Logistics”) and “百千物流” (“Baiqian Logistics” or “BQ Logistics”) also appeared in the documents produced by the parties or were mentioned by the witnesses in the course of their oral evidence. BQ Logistics was a Shenzhen company. The evidence shows that:-
68.In fact, as revealed by Liao EH during cross-examination, his companies appeared to be going through some kind of restructuring in or about the time when Chan was recruited as a cross-border driver. According to Liao EH, SLY was registered in Shenzhen in 2005. In 2009, SLY began discussions with “聯想集團” (the Lenovo Group) to explore the opportunity of having some kind of co-operation with a view to enabling SLY to be publicly listed in Shenzhen. However, nothing materialized since SLY was not strong enough to meet the listing conditions. In or about 2010 to 2011, Liao EH registered BQ Logistics in Shenzhen with a view to restructuring and consolidating the business and operations of SLY in Shenzhen. It is noted from the documents produced that the Hong Kong company also changed its name during this period in early 2011 from its previous name of San Xing Express Company Limited to its present name of Baiqian International Holding Limited on 9 February 2011, probably also as part of the purported restructuring and consolidating exercise. 69.Having considered the evidence available, I do not accept the story of BQIH that these three companies were separate and independent companies. It is evident that these three companies, namely BQIH, SLY and BQ Logistics, are associated companies within the same group and they have significant overlap in their shareholders and management. The structure of the group might then be in a state of flux in 2011 at the time when Chan was recruited as a cross-border driver when the role of each one of these companies within the group was not yet clearly defined. (H) The parties’ own view of their relationship 70.I have no doubt that Chan considered BQIH as his employer. Although on some occasions such as in his Notification of Accident dated 13 August 2012 he had mis-stated the name of his employer as “百千國際物流有限公司” (Baiqian International Logistics Limited Company, or BQ Logistics), I am of the view that such kind of mistake is understandable given that the Chinese name of BQ Logistics is so confusingly similar to the Chinese name of BQIH and that such name of “百千國際物流有限公司” (BQ Logistics) was actually painted on the body of the Lorry driven by Chan. 71.The position of BQIH is more equivocal. On the one hand, BQIH named itself as Chan’s employer in Chan’s application to AXA for joining its MPF scheme. On the other hand, it insisted that SLY was the employer of Chan instead. It appears to me that both BQIH and SLY had intentionally tried to keep the status of the cross-border drivers ambiguous so as to avoid the legal consequences of whatever enforcement actions that might be brought against BQIH and/or SLY for non-compliance with the relevant employment–related regulations, such as the NSSF in China and MPF and Employees Compensation insurance in Hong Kong. BQIH was Chan’s employer 72.By making an informed, considered and qualitative assessment of all relevant evidence available, it gives me a strong overall impression and I therefore find accordingly that BQIH was the employer of Chan. In arriving at such a decision, I have placed particular weight on those factors discussed under sub-headings (A), (B), (E), (F), (G) and (H) above. WHETHER AND HOW THE ACCIDENT HAPPENED; WHETHER BQIH IS LIABLE? 73.I notice that the Accident as described by Chan in his witness statement is slightly different from the case pleaded on his behalf, but the differences are relatively insignificant. It is Chan’s case as contained in his witness statements and oral testimony given at trial that:-
74.From the documents contained in the trial bundles, Chan reported the Accident to the Labour Department of the HKSAR Government by submitting a Notification of Accident dated 13 August 2012 stating that he sprained his low back when he was unloading cargoes on 2 August 2012 at 4:30 pm. He also stated in such notice that the contact person of his employer was Tsang SC though he mis-stated the name of the employer company as BQ Logistics. Officers of the Labour Department took statement from Chan in the form of a declaration made by him on 23 August 2012. 75.In so far as the position of BQIH is concerned, not only did it dispute the employment status of Chan it did not admit the accident either. BQIH averred that the Accident did not occur in the course of Chan’s employment as alleged or at all. BQIH also averred that: Chan was employed by SLY as a cross-border driver for transportation of cargoes between Shenzhen and Hong Kong using the Lorry provided by BQIH; BQIH did not give any instructions to Chan to load or unload cargoes; the loading and unloading of cargoes had no connection with BQIH’s trade or business; the accident did not result from a risk which was necessarily incidental to the performance of Chan’s duties; Chan had no express or implied authority to load or unload cargoes; Chan’s injury was attributable to his own serious and wilful misconduct; and there is no or insufficient causal connection between the Accident and his employment. 76.Of the three witnesses who gave evidence for BQIH, two of them, namely Tsang SC (DW1) and Liao EH (DW2), had part of their evidence dealing with the Accident. Taking their evidence as contained in their witness statements and as given at the trial together, it appears rather clearly that they did not have much to say directly about the Accident. What they had been trying to do was to implicate, but without stating explicitly, that there was not the Accident as claimed by Chan because he was not required to load or unload cargoes, and that he made up his story of having suffered injuries in the Accident because he was then having a labour dispute with his employer and was not happy about the new rotation arrangement made by BQIH or SLY under the new UPS contract. 77.It is the evidence of Tsang SC (DW1) that:-
78.Under cross-examination, Tsang SC agreed that he had never given instructions to Chan as to how to handle cargoes or heavy loads, but he also said that he had never given instructions to Chan to handle or move the cargoes. He conceded that he had never been to the UPS cargo unloading area in the Hong Kong International Airport. He said that he was speaking from his 16 years of working experience with UPS. He said that Chan rang him at about 8 pm or 9 pm after the Accident. Tsang SC said he did not know why Chan rang him instead of ringing up a member of staff of SLY to inform him of the Accident. 79.It is the evidence of Liao EH (DW2) that:-
80.I notice that there are a number of gaps in the case of BQIH and in the evidence of both Tsang SC and Liao EH concerning the Accident and their implications against Chan. The following are two examples of these gaps:-
81.I have already found earlier that the defence witnesses, in particular Tsang SC and Liao EH, were evasive, unreliable and could not be trusted. Upon a close analysis of the evidence given by Chan about the Accident, I find Chan’s story regarding the Accident coherent and logical. I, therefore, prefer Chan’s account of the events to the story given by the two defence witnesses of Tsang SC and Liao EH. 82.It is my finding that:-
WHAT WERE THE INJURIES AND DAMAGES SUFFERED BY CHAN? Injuries and medical treatments 83.Chan complained that he suffered back injuries in the Accident. He said he went to consult a Chinese medical practitioner in 許國賢骨傷科醫館 (Hui Kok Yin Bone Injuries Clinic) on 3 August 2012. He was granted one day sick-leave. 84.Due to intensifying pain, Chan went to the Accident & Emergency Department of Queen Mary Hospital for treatment at about 4 am of 4 August 2012. It was recorded in the medical certificate dated 15 October 2012 issued by Dr Herbert Yuen, resident of the Accident & Emergency Department, Queen Mary Hospital, that Chan complained of lower back pain, but there was no lower limb numbness or weakness, and that he was alert and afebrile. X-ray of lumbar spine showed no fracture. He was given analgesics and discharged with two days sick leave granted to him. 85.Chan subsequently attended the Sai Ying Pun Clinic (Family Medicine) (“SYPC”) for consultation and treatment for 5 times on 22, 24 and 28 August 2012, and 3 and 5 September 2012. Medical report dated 22 October 2012 compiled by Dr Ngai Ming Leon, resident in Sai Ying Pun Clinic (Family Medicine), Department of Family Medicine & Primary Healthcare, Hospital Authority, recorded that Chan claimed that his back was sprained on 2 August 2012 when he was pulling heavy objects. When Chan first attended SYPC on 22 August 2012, he complained about having persistent back pain. Numbness on his right foot without any weakness was noted. Physical examination revealed tenderness and stiffness over the 2nd and 3rd lumbar paraspinal muscle and the range of spinal movement was markedly limited in flexion. Though there was decreased sensation over the whole right foot, its power was not affected. Doctor’s diagnosis was back sprain and radiculopathy. Chan was referred to physiotherapy. He was discharged with oral analgesics. During the period when Chan was waiting for physiotherapy treatment in the public hospital, he went back to SYPC on four more occasions during the period from late August to early September 2012 to seek treatment for his back pain. It also appears from the medical receipts produced by Chan that he had sought medical treatment in Dongguan City in January, March and October 2013. 86.Chan was assessed by the Employees’ Compensation (Ordinary Assessment) Board on 10 December 2012 and 4 January 2013. A Form 7 Certificate of Assessment was issued on 18 January 2013. Chan was assessed to have sustained back sprain resulting in residual pain. Period of absence from duty necessary as a result of the injury was assessed to be 3-5 & 22-31 August 2012, and 3-7 September 2012. Loss of Earning Capacity permanently caused by the injury was assessed by the Board to be 1%. Chan applied for review of the assessment by the Board. The review was carried out on 24 May 2013. The Board, by a Form 9 Certificate of Review of Assessment issued on 7 June 2013, confirmed the original assessment which remained unchanged. 87.On 16 January 2014, a joint medical assessment was carried out on Chan by Dr Lam Chi Keung Johnson appointed by Chan’s solicitors and Dr Chiang Si Chung Arthur appointed by BQIH’s solicitors. Dr Lam and Dr Chiang submitted a joint report dated 10 April 2014 (“the Joint Report”). In the Joint Report, it was recorded that the Accident was the first time Chan had an accident on duty. Before the Accident, he had no previous injury or pre-existing pain in his back and his health was satisfactory with no chronic disease or previous major surgery. Both Dr Lam and Dr Chiang agreed that Chan suffered soft tissue injury to his low back which injury was consistent with the mechanism of injury described if the Accident did happen. Radiologically, there were very mild degenerative changes in Chan’s lumbar spine and they were likely to be a pre-existing condition which might be symptomatic or asymptomatic. He did not require or at least there was no evidence suggesting that he required any treatment or therapy for his back before the Accident. Functionally, Chan could do jobs that required long hours of driving and sitting. It was likely that Chan enjoyed rather painless and satisfactory function in his low back before the Accident. Both doctors were of the view that the treatment Chan received was appropriate and that no surgery was required for his injuries. They also opined that Chan’s back injury had reached maximal medical improvement at the time of the joint assessment. 88.Dr Lam, medical expert retained by Chan’s solicitors, took the view that whilst it was possible that Chan suffered only mild soft tissue injury to his back in the Accident, it was also possible that the soft tissue injury to his low back was more significant than it first appeared taking into account the subsequent chain of events including the clinical picture (that the pain was so severe that Chan needed to rest on the floor for about an hour before he could get up after the Accident), the clinical progress with treatment (that the pain increased to such an extent that Chan felt the need to attend the Accident & Emergency Department, Queen Mary Hospital and he subsequently felt the need to seek treatment in mainland China for about 40 days resulting in only partial, though significant, improvement), the further investigation findings, and the latest findings in the joint assessment (in that Chan still complained of right buttock numbness on prolonged sitting for over an hour; numbness in the buttock when lying on one side during long sleep; that Chan saw it fit to take some kind of medicine he got from Thailand every day; that there was still mild tenderness over the lumbar paraspinal muscle with muscle tightness and guarding without muscle spasm; that there was mild tenderness over the lumbosacral junction and the sacrum). Dr Lam opined that it was likely that Chan had more significant or at least moderate degree of soft tissue injury to his low back, causing persistent low back pain and impairment as a residue of the Accident. He assessed that the degree of residual pain and impairment to be mild. He opined that the fact that Chan suddenly began to experience rather persistent low back symptoms with physical signs after the Accident made it unlikely that the problem was a result of the natural progression of degeneration which was usually a slow and gradual process. He further opined that the problem was more probably a result of the Accident. As regards Chan’s work capacity, he had returned to work as a driver with duties for short trips within Hong Kong instead of cross-border. Dr Lam opined that, with more exercise to strengthen his back, Chan, gradually and eventually, should be able to return to his pre-accident job as a cross-border lorry driver with reduced capacity in that he would need more short breaks for rest or stretching after prolonged period of driving, but he should avoid long period of driving for, say, over 12 hours. It is Dr Lam’s evaluation that Chan has suffered about 3% impairment of the whole person and 3% loss of earning capacity. 89.On the other hand, Dr Chiang, medical expert retained by BQIH’s solicitors, based on the description of Chan’s symptoms as stated in the SYPC clinical records, came to the view that Chan suffered soft tissue injury of his low back with mild symptoms and signs and that the initially noted limitation in flexion range had likely improved a lot about one month after the Accident by early September 2012. The absence of limitation in the straight leg raising test in the initial three weeks after the Accident, and the satisfactory condition of Chan’s low back in early September 2012 might have suggested that the mild limitation in the right-sided straight leg raise test was probably a transient physical sign. The late appearance of numbness in the right foot, which was not confirmed by sensation testing, would also have suggested that the numbness was possibly mild and transient. The fact that Chan complained of right buttock numbness on prolonged sitting and prolonged sleeping only recently but not previously suggested that the symptom should not be related to his injury. It could either have arisen from events unrelated to the injury at a later stage, or it might not be actually present since there was no supporting unilateral physical sign in the right lower limb to explain for the right buttock numbness. Further, latest physical examination showed that Chan’s low back was in a satisfactory condition with no muscle spasm felt and no display of motor or sensory neurological deficit in both lower limbs. X-ray also showed that the lumbar lordosis was well-preserved. Dr Chiang was also of the view that the recently noted bilateral limitation of the straight leg raise test was unlikely to be related to the injury Chan sustained in the Accident because the same test carried out in both limbs in the early stage after the Accident was normal though there was transient limitation in the right-sided straight leg raising test. Dr Chiang noted that the range of moving test of the back and tenderness were subjective tests which depended on the patient’s effort or his description, and it might not be as reliable as the objective test. Taking into account all the information available, Dr Chiang considered that Chan’s soft tissue injury had likely attained a reasonable recovery by early September 2012 and that the latest examination results supported the view that Chan had achieved a satisfactory recovery. Dr Chiang opined that Chan’s total impairment of the whole person resulting from his injury was 1% and his loss of earning capacity was also 1%. 90.Regarding Chan’s sick leave, Dr Lam opined that the sick leave granted to Chan from time to time by his treating specialists/doctors was appropriate and should be endorsed. Dr Chiang agreed that the sick leave outlined in the Form 9 should be granted to Chan. 91.The difference between the respective opinion of Dr Lam and Dr Chiang is more nominal than real. Though Dr Lam seems to be suggesting than the soft tissue injury sustained by Chan might be somewhat a bit more serious that it first appeared, his conclusion seems to be that Chan had recovered reasonably well; that he could return to his pre-accident job as a cross-border lorry driver gradually and eventually; and that both his impairment of the whole person and his loss of earning capacity were relatively mild at 3%. Assessment for employees’ compensation 92.Chan’s claim for employees’ compensation consists of 3 heads of claim as follows:-
(a) S 9 Compensation 93.The injury suffered by Chan was not specified in the First Schedule of ECO. Therefore, the applicable subsection for assessing his compensation for permanent partial incapacity is s 9(1)(b). 94.Mr Liu, counsel for Chan, referred me to the case of Kan Wai Yip v Everbest Port Services Limited, unreported, DCEC 383/2008, 3 February 2009, paras 36-45 in which HH Judge Marlene Ng pointed out that in assessing the loss of earning capacity, the court should come to its own assessment in accordance with the guidelines in s 9(1)(b) of ECO, instead of merely adopting the percentage of loss of earning capacity given by expert. Mr Liu submitted that, taking all the sufferings and circumstances of this case and comparing Chan’s injury with the injuries in Schedule 1 of ECO, the appropriate and reasonable assessment of the percentage of loss of earning capacity should be 2%. 95.Mr Lam, counsel for BQIH, submitted that Chan did not file any Notification for Appeal to Form 9 for this trial in accordance with s 18 of ECO and therefore should not be heard on arguments involving the decision of the Medical Assessment Board. Hence, he submitted, the 1% loss of earning capacity as assessed by the Board should be adopted. 96.S 18 of ECO requires that any appeal shall lie to the District Court from any decision or assessment of the Board within 6 months of such decision or assessment, but the court may, if it thinks fit, extend the time within which to appeal notwithstanding that the time has elapsed. It is true that no appeal has been taken out against the assessment of the Board in the present case. The result is that, according to s 16H of ECO, the assessment and decision of the Board as contained in the Form 9 Certificate of Review of Assessment issued on 7 June 2013, shall be admitted in evidence without further proof on its production in any court and, until the contrary is proved, it shall be presumed that the certificate is so issued and signed, and shall be evidence of the matters stated therein, ie including the nature of Chan’s injury, the period(s) of sick leave necessary as a result of such injury, and Chan’s percentage loss of earning capacity of 1%. However, there is nothing in s 16H or any other provisions in ECO suggesting that such piece of evidence shall be conclusive. It is for the court to draw its own conclusion as to the earning capacity of Chan. In determining the matter, the court has to take into account all relevant factors including the Form 7 or Form 9 if one is available. 97.Whilst I accept Mr Liu’s submissions that the court should come to its own assessment of Chan’s loss of earning capacity in accordance with the guidelines in section 9(1)(b) of the ECO, I am not convinced, having considered all the evidence available, that Chan’s loss of earning capacity should be 2% instead of 1% as submitted by Mr Liu. 98.Chan was born on 30 July 1956. He was aged 56 when the Accident happened on 2 August 2012. Given that Chan was over 56 years of age at the time of the Accident, a lump sum equal to 48 months’ earnings should be used for calculating Chan’s s 9 compensation: see s 7(1)(c) of ECO. 99.There is no dispute that Chan’s monthly salary at the time of the Accident was HK$16,000.00. However, there is a dispute between the parties as to whether the employer’s contribution to the Mandatory Provident Funds should be included in calculating the monthly earnings of Chan. Chan’s counsel has adopted the sum of HK$16,325.00 as Chan’s monthly earnings, of which the sum of HK$325.00 was the employer’s monthly contribution to Chan’s MPF account.[1] On the other hand, BQIH’s counsel has adopted the figure of HK$16,000.00. It was submitted by BQIH’s counsel and I agreed that, for the purpose of assessing employee’s compensation, Chan’s “earnings” should not include employer’s contribution to his MPF which was specifically excluded from the meaning of “earnings” as defined in s.3 of ECO.[2] 100.By reason of the foregoing, I assess the s.9 compensation for his permanent partial loss of earning capacity to be:
(b) S 10 Compensation 101.S 10(1) of ECO provides:-
102.According to s 10(5), the maximum period that an employee can receive periodical payments under s 10 is 24 months or for such further period being not more than 12 months as the court may allow. 103.Mr Liu, counsel for Chan, submitted that the 24-month period from 3 August 2012 to 2 August 2014 under this head of claim can be broken down into three parts as follows:-
104.It is the submissions of Mr Lam, counsel for BQIH, that:-
105.I accept the submissions of Mr Liu that Chan had tried to secure employments which his physical condition could manage. Though his physical condition had not yet recovered enough during the period from mid-September 2012 to January 2014 to enable him to be employed as a cross-border driver, he tried to do jobs as a local driver for private car within Hong Kong. I agree with Mr Liu on the approach to be adopted for assessing s 10 compensation, though I do not agree that the amount of employer’s contribution to MPF could be taken into account by reason of the definition of “earnings” under s 3 of ECO when assessing the amount of Chan’s monthly earnings. 106.I, therefore, assess Chan’s s 10 compensation as follows:-
(c) S 10A Compensation 107.Under s 10A(1) of ECO, if, in any employment, personal injury is caused to an employee by accident arising out of and in the course of his employment, his employer shall be liable to pay the medical expenses for the medical treatment in respect of such injury. S 10A(1A) provides that unless otherwise provided by agreement in writing entered into by the employer and the employee, medical expenses which an employer is liable to pay under s 10(1) does not include those in respect of medical treatment given outside Hong Kong in relation to an accident occurring in Hong Kong. 108.Mr Liu, counsel for Chan, quite rightly claimed only the sum of HK$685.00 as medical expenses incurred by Chan in Hong Kong during the period between 3 August 2012 and 3 September 2012 under s 10A without including those medical expenses incurred by Chan in Mainland China. 109.Interestingly, counsel for BQIH in their Opening Submissions (paragraph 64), stated that the sum of HK$12,516.25 was acceptable under s 10A. It appears that they were referring to the sum of HK$12,516.25 claimed by Chan in the PI Action as the medical expenses incurred which included those incurrred by him in Hong Kong as well as those incurred in Mainland China. As such, it must be understood to mean that BQIH did not dispute the HK$685 claimed by Chan under s 10A. 110.To summarise, the compensation of Chan under ECO is assessed as follows:-
Assessment for PI action 111.Chan’s claim in the PI Action consists of the following heads of damages:-
(a) PSLA 112.Mr Liu, counsel for Chan, submitted that an award for PSLA in the present case should be about HK$150,000. Mr Lam, counsel for BQIH, suggested that HK70,000 was the appropriate award. Having considered the submissions by both counsel and the authorities cited by them in support of their contention, I find that an award of HK$100,000 of HK$100,000 is appropriate for Chan’s case. (b) Pre-trial loss of earnings 113.Mr Liu submitted that the appropriate award under this head of claim should be about HK$271,805.82. The basis of his submissions is by and large the same as those he made under the EC Action for s 10 compensation save for these two differences:-
114.Mr Lam in his submissions argued and contended that:-
115.I do not agree with the submissions of Mr Lam for the following reasons:-
116.In so far as Mr Liu’s submissions are concerned, I do not agree with him that Chan should be allowed a few more months from 16 January 2014 (ie the date of the joint assessment of Chan by the two medical experts) to 31 July 2014 for him to find a job as a cross-border driver. Taking into account the fact that the back injury he suffered was relatively mild and that the available evidence showed that he had no need for medical treatment any more since around the end of 2013, I find that Chan could have found a job as a cross-border driver latest by about mid-January 2014. As such, I find that Chan’s pre-trial loss of earnings largely overlap with his s 10 compensation under ECO save that adjustments shall be made to remove the “one-fifth discount” stipulated in s 10 of ECO and that a further sum representing employer’s 5% contribution to the MPF shall be added back to the assessed sum. I calculate Chan’s pre-trial loss of earnings as follows:-
(c) Special damages for medical expenses, travelling expenses and tonic food expenses 117.Mr Liu claims on behalf of Chan the total sum of HK$17,916.25 under this head, consisting of the respective sum of HK$12,516.25, HK$2,000.00 and HK$3,400.00 as medical expenses, transportation expenses, and tonic food expenses incurred. Whilst the amounts claimed for transportation expenses and tonic food expenses were not disputed by Mr Lam for BQIH, he changed the position he adopted in paragraphs 64 and 89 of BQIH’s Opening Submissions (where it was clearly stated in paragraph 64 that “Medical expenses of $12,516.25 is acceptable” and in paragraph 89 that “The Defendant agrees to the sum stated in the Opening Submissions [of the Plaintiff]”) and submitted in paragraph 344 of his Closing Submissions that the sum of HK$8,890.00 in respect of the two Dongguan physiotherapy medical receipts should not be allowed on the ground that one of them had been tempered. I reject Mr Lam’s submissions regarding these two receipts for the reasons I have already discussed in paragraph 115 (1) above. I therefore allow these sums which totaled HK$17,916.25 as claimed. (d) Loss of earning capacity 118.Mr Liu claims on behalf of Chan the sum of HK$16,800.00 as the damages for Chan’s loss of earning capacity to reflect the handicap that Chan will suffer in the open labour market as a result of his physical impairment and loss of earning capacity. On the other hand, Mr Lam submitted that there was no evidence to support such award. With the very mild 1% physical impairment and 1% loss of earning capacity suffered by Chan, I do not find that Chan will suffer any or any significant disadvantage or handicap in the open labour market to justify an award to be made under this head of claim. See Moeliker v A Reyrolle and Co Ltd [1977] 1 WLR 132 at 141. Summary of assessment in PI action 119.To summarise, the following is my assessment of Chan’s damages in the PI Action:-
Interest 120.Chan is entitled to interest on the awards as follows:
Costs 121.I also make a costs order nisi that Chan is entitled to costs of the EC Action and the PI Action, to be taxed if not agreed, with certificate for counsel and that Chan’s own costs are to be taxed in accordance with Legal Aid Regulations. 122.Lastly, I would like to thank counsel for Chan and both counsel for BQIH for their assistance at the trial.
Mr Jerome Liu, instructed by Andrew Chan & Co, assigned by the Director of Legal Aid, for the applicant/plaintiff Mr Osmond Lam and Mr Jensen Yuen, instructed by Lee Wong & Co, for the respondent/defendant [1] As I have pointed out above, such sum of HK$325.00 was apparently calculated with reference to the “Minimum Relevant Income” of HK$6,500.00 stipulated by law during the period between 1 November 2011 and 31 May 2012. The proper amount of contribution by employer in Chan’s case should be HK$800.00 during the same period, representing 5% of Chan’s monthly salary of HK$16,000.00. [2] Under s 3 of ECO, “earnings” means “any wages paid in cash to the employee by the employer and any privilege or benefit which is capable of being estimated in money and includes ... but shall not include ... a contribution paid by the employer of an employee towards any pension or provident fund, or a sum paid to an employee to cover any special expenses entailed on him by the nature of his employment”. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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