Wong Wai Chun v. The China Navigation Co Ltd

IN THE SUPREME COURT OF HONG KONG

APPELLATE JURISDICTION

CIVIL APPEAL NO. 3 OF 1969

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Coram: Hogan, C.J., Blair-Kerr, & Huggins, JJ.

Date of Judgment: 17 September 1969

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JUDGMENT

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Huggins, J:

1. I agree that this appeal should be dismissed.

2. As to the doctrine of volenti non fit injuria I think the passages cited from A.C. Billings & Sons Ltd. v. Riden⁽¹⁾ show that in this type of case what one has to consider is whether a man of ordinary intelligence and courage would have done what the injured person has done. In considering that question the proper factors are the extent and imminence of the danger, its obviousness or any warning which has been given and any pressure there may have been on the injured person to assume the risk. In all the circumstances of this case it seems to me that although the deceased voluntarily assumed some risk it was a risk which any reasonable person might have assumed and therefore the learned judge was justified in holding that the doctrine did not apply.

3. The main issue on the appeal has been whether the appellants can rely upon the sweeping disclaimer of all liability which they seek to read into the contract of carriage. They rely upon a note on the ticket issued to the deceased and upon the company's conditions therein referred to. We have heard a lengthy argument as to the principles to be applied and my Lords have reviewed most of the authorities. As I entirely agree with their conclusion I shall be as brief as I can but there are one or two things I feel compelled to say concerning this not very satisfactory branch of the law.

4. With reference to contracts alleged to contain special terms limiting a carrier's liability Sir Frederick Pollock said in his book on Contracts (13th Ed.) at p.41:

"In dealing with cases of this class the general principles governing the formation of contracts have steadily to be borne in mind".

While it may be convenient to describe a contract as an agreement which carries the sanction of the law Lord Elden pointed out in Kennedy v. Lee⁽²⁾:

"I do not mean ...... that I am to see that both parties really meant the same precise thing, but that both actually gave their assent to that proposition which, be it what it may, de facto arises out of the terms of the correspondence".

We should, therefore, be concerned to ascertain what as a matter of fact were the terms of carriage to which the parties gave their assent.

5. However, any review of the reported cases quickly shows that the attempts of juries and judges at first instance to apply common sense principles and practical experience to the "ticket" cases have been repeatedly frustrated, despite occasional protest from academic writers and frank admissions by some appellate judges that the law was becoming artificial. It has, indeed, become completely divorced from reality and one has to look hard to recognise "the general principles governing the formation of contracts" which Sir Frederick Pollock said should be borne in mind. This is particularly unfortunate in view of Lord O'Hagan's observation in Henderson v. Stevenson⁽³⁾:-

"When a company desires to impose special and most stringent terms upon its customers, in exoneration of its own liability, there is nothing unreasonable in requiring that those terms shall be distinctly declared and deliberately accepted".

6. Originally I embarked upon my own detailed analysis of the cases but in the end I decided that it would serve no useful purpose. The English courts have seen fit to base themselves upon the assumption that the majority of persons who enter into certain types of contract know that conditions are likely to be imposed by the other parties, that such conditions will be set out in a ticket and that such conditions will be likely to contain restrictions on liability. They have therefore held that everyone ought to be deemed to know that such conditions are likely to be imposed: see, for example, Cockerton v. Naviera Aznar S.A.⁽⁴⁾ and Parker v. South Eastern Railway Co.⁽⁵⁾. While I confess to grave doubts whether the initial assumption was justified even in England and although it was manifestly unnecessary to make any such artificial rule on the ground of business convenience, I think it must be accepted that all the English courts save the House of Lords are now bound to enforce this rule. Whether the courts of Hong Kong are so bound is a very different matter and I wish to reserve that question for consideration should occasion arise. Anyone who thinks that in the Far East the majority of persons who enter into these types of contract know that conditions are likely to be imposed and that such conditions will be set out in a ticket is living in a dream world of his own.

7. In the present case I am prepared to assume that the principles propounded in Parker v. South Eastern Railway Co.⁽⁵⁾ and approved in Richardson, Spence & Co. v. Rowntree⁽⁶⁾ are applicable, but that does not conclude the matter. Those principles were laid down in the following terms at p.423:

"...... if the person receiving the ticket did not see or know that there was any writing on the ticket, he is not bound by the conditions; ... if he knew there was writing, and knew or believed that the writing contained conditions, then he is bound by the conditions; ... if he knew there was writing on the ticket, but did not know or believe that the writing contained conditions, nevertheless he would be bound, if the delivering of the ticket to him in such a manner that he could see there was writing upon it, was, in the opinion of the jury, reasonable notice that the writing contained conditions".

I will assume that the deceased in this case knew there was writing on the ticket. There is no evidence he knew or believed the writing contained conditions. What is reasonable notice for the purpose of the third question is a question of fact: Cooke v. T. Wilson, Sons & Co. Ltd.⁽⁷⁾ It is, however a question upon which appellate courts have been so ready to impose their own views that it has in practice become very nearly a question of law. In all the cases cited to us where conditions relating to carriage have been held to be binding the ticket, which has commonly been assumed to be intended to be the contract itself rather than merely a receipt or evidence of the contract (of. Chapelton v. Barry U.D.C.⁽⁸⁾ and per Lord Hatherley in Henderson v. Stevenson⁽³⁾ at p.479), has borne on its face some clear reference to the existence of the conditions sought to be relied upon. Henderson v. Stevenson⁽³⁾ and Sugar v. L.M.S. Railway Co.⁽⁹⁾ are typical examples. If I may say so without disrespect I entirely agree with Lord Cairns when he said in Henderson v. Stevenson⁽³⁾ at p.475:

"It seems to me that it would be extremely dangerous, not merely with regard to contracts of this description, but with regard to all contracts, if it were to be held that a document complete upon the face of it can be exhibited as between two contracting parties, and, without any knowledge of anything beside, from the mere circumstance that upon the back of their document there is something else printed which has not actually been brought to and has not come to the notice of one of the contracting parties, that contracting party is to be held to have assented to that which he has not seen, of which he knows nothing, and which is not in any way ostensibly connected with that which is printed or written upon the face of the contract presented to him".

A case may arise in which it is shown that attention has been directed to the conditions without there being any reference on the face of the ticket but there is in the present case no evidence of any attempt so to direct the attention of the deceased. The ticket issued to him was in triplicate. The documents were taken from a book in which, at least at the time when they were prepared, they would appear to have been folded in what I may describe as concertina form. We do not know how they were handed to the deceased but we are entitled to assume that he would concern himself only with the original, marked "passenger's counterfoil". Nothing on the face of that counterfoil gave any indication that there was a warning on the back of it to the effect that the ticket was issued subject to conditions. Even applying the principles of Parker v. South Eastern Railway Co.⁽⁵⁾, therefore, it has not been shown that reasonable notice was given.

8. It is unfortunate that the form of the judgment in the court below is such that we have had to spend much time trying to ascertain what the learned judge actually decided. At first I was inclined towards a conclusion different from that which has commended itself to my Lords because I based my interpretation more upon the grammatical construction of the judgment than upon its content. However, it is clear that the paragraphing of the judgment as a whole is somewhat haphazard and I am now persuaded that when the learned judge said "Here the defendants discharged the onus of proving that they took reasonable steps to draw the attention of the deceased to the conditions which I have set out above" he was referring to Cockerton v. Naviera Aznar S.A.⁽⁴⁾, despite the fact that there was no deceased in that case. What I still find difficult to understand is this passage referring to the present case:

"All that is known therefore is that this warning on the back of the ticket was given to the deceased. I do not think that that is enough. In Watkins v. Rymill⁽¹⁰⁾ it was proved that the conditions in question were conspicuously displayed for all to see. In the absence of some evidence that the conditions were readily available or conspicuously displayed at the place where the contract was made I do not think that the defendant has discharged the onus of proof placed upon him".

I do not stop to inquire whether when he said "this warning ...... was given to the deceased" the learned judge meant "this document with the warning on it was physically conveyed to the deceased" or "the warning was brought to the attention of the deceased". Why did he think the warning was not enough? In the same paragraph he refers to the absence of evidence that the conditions of carriage were readily available or conspicuously displayed at the place where the contract was made and this strongly suggests that he thought the absence of such evidence was sufficient reason for saying the warning on the ticket was not enough. It seems to me totally irrelevant to inquire whether the conditions were available at the place where the contract was made, or at the office of the principal agents of the appellants in Sydney. The words "which may be read at ......" were at the most a representation that a copy of the conditions was available for inspection at the place indicated. It was not a representation upon which the deceased appears to have relied, whether it was true or not. What he assented to, if he assented to any written conditions, were "the company's conditions" and in my view the company's conditions have been sufficiently identified by production of a copy from the Hong Kong office. If the learned judge was saying that the conditions in the ticket were not binding solely because there was no evidence that they could in fact be seen for the asking, or if he read the notice on the ticket as though it said "This ticket is issued subject to the company's terms and conditions of carriage as exhibited in the office of principal agents in each port" (the last part of the sentence identifying the version of the company's terms and conditions to be applied), I think he was wrong. Nevertheless if he found that the warning on the ticket was, even apart from the absence of evidence that the conditions were to be seen for the asking, sufficient to show that the acceptance of the ticket without protest indicated assent to the company's terms and conditions of carriage I think that also was wrong, for it was not justified by the evidence. Accordingly whether he reached it for the right or the wrong reasons I think his conclusion that the conditions were not binding on the deceased was correct.

9. I also agree with the decision which my Lord the Chief Justice has reached concerning the third ground of appeal and I have nothing to add thereon.

10. As to the fourth ground of appeal it is said that 8% is a proper rate of interest to allow in Hong Kong and that if the award of $115,200 were invested at that rate it would produce an annual income of $9,216. That exceeds by $2,016 the annual loss of support by the dependants as calculated by the learned judge and it would not therefore be necessary to draw upon the capital sum in order to produce the sum required to compensate for that loss of support. The result would be, counsel argues, that at the end of the period of notional dependency the capital would remain untouched and would constitute a profit in the hands of the dependants. I agree that that cannot be right. However, I share my Lords' view that the assessment of the dependency at only $600 p.m. was too low. If one takes Mr. Justice Blair-Kerr's figure of $1,000 p.m. (and I think it is probably about right) the annual income will not be sufficient to compensate for the annual loss of support. Indeed the table calculated by Mr. Justice Blair-Kerr shows the award to be, if anything, slightly on the low side. In saying that I do not overlook the fact that the capitalised dependency must, on the authorities, be discounted in respect of the sundry contingencies which may reduce the actual loss of the dependants. I share the anxiety expressed by Lord Justice Denning in Nunn v. Cocksedge Ltd. referred to in Kemp & Kemp's ...(illegible) on the Quantum of Damages in relation to a discounting for the possibility of the widow's remarrying, and that is not the only contingency which I think may be overweighted with resulting injustice to the dependants. I certainly would not be prepared to adopt a standard figure, whether of 20% or any other percentage, as applicable in all cases and in my view the decision of this court in Leung Tai-ah v. Chan Tak-wan⁽¹¹⁾ should not be regarded as authority for so doing. The circumstances of each case ought to be considered. No accurate forecast can in the nature of things be made and it may not be desirable to attempt to draw up a list of the contingencies which may be material. When life expectation tables are used they themselves take account of the risk that a deceased himself might die from other causes. It would need evidence of special risk to justify a further discounting. Where the deceased's working life is taken as the guiding factor any risk arising from his state of health must be allowed for. The state of health of the dependants will always be material. In the present case there was no evidence of any particular contingency which involved appreciable risk and I would see no justification for discounting at more than 10% at the very outside. I think 5% would be a fairer figure. In the circumstances I would not interfere with the assessment of the learned judge.

17th September, 1969.

(1) 1958 A.C. 240.

(2) (1817) 3 Mer. 441, 451.

(3) (1875) 2 Sc. & Div. App. Cas. 470, 481.

(4) (1960) 2 Lloyds Report 450

(5) (1877) 2 C.P.D. 416, 422

(6) (1894) App. Cas. 217

(7) (1915) 85 L.J. K.B.888

(8) (1940) 1 K.B. 532

(9) (1941) a All E.R. 172

(10) (1883) 10 Q.B.D. 178

(11) 1968 H.K.L.R. 224