Ng Chai Man and Another v. Leung Ngan

CACV000055/1983

Headnote

Interest - Damages - Personal Injuries - new guideline on rate of interest to be awarded for non-economic loss.

Held: (dismissing the appeal against the assessment of damages): The decision of the House of Lords in Wright v. British Railways Board [1983] 3 W.L.R. 211 showed that the guideline laid down by the Hong Kong Court of Appeal in Wong Yuk Chau and Another v. Tang Suk Yee - Civil Appeal No. 13 of 1983: 24th March 1983 - [that interest on general damages for pain, suffering, loss of amenities and loss of expectation of life should continue to be at the full economic rate] was wrong and, in the light of de Lasala v. de Lasala [1980] A.C. 456, must be corrected since the legislative provisions which require interest to be awarded and the principles upon which the rate of interest is assessed are the same in Britain and Hong Kong. The new guideline would therefore be that the rate of interest to be awarded in personal injury action on damages for non-economic loss should be 2%.

Coram: Hon. Leonard, V.-P., Cons & Fuad, JJ.A.

Date of hearing: 19 July 1983

Date of Judgment: 19 July 1983

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J U D G M E N T

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Fuad, J.A. :

1. This is an appeal against an assessment of damages for personal injuries made by a Commissioner of the High Court in a decision given on the 26th February 1983. At the trial the Appellants, the Kowloon Motor Bus Co. and one of their drivers, denied liability but there is no challenge before us regarding the Commissioner's finding of negligence, and so the manner in which the Respondent, Madam Leung Ngan, sustained her injuries, does not call for examination. The Commissioner found the following: that as a result of the accident which occurred on the 16th August 1981 Madam Leung, then aged about 61, and a widow for many years, sustained a fracture of the medial side of the upper end of the left tibia. She stayed in hospital for 19 days while the fracture was treated, and she had to wear a plaster cast on her leg for six weeks in all. After the cast was removed she used crutches for three months and then a walking stick for a further two weeks. There was permanent damage to the condyle of the tibia, in that the front part of the lateral condyle is slightly depressed downwards by one or two millimeters and a bony projection protrudes at the front of the tibia. Since the fracture involves the condyle, which is partially displaced and is a weight-bearing section of the surface of the knee joint, osteoarthritis would inevitably develop. The impairment was assessed at 1% but would increase to 3-4% impairment by the age of 70.

2. Madam Leung, the Commissioner found, was unable to walk as far as she could do before the accident or to stand for more than one or two hours at a time without pain and discomfort. While she was not crippled, she had a stiff knee and could no longer squat - her disabilities were permanent and would gradually worsen as osteoarthritis developed.

3. The Commissioner awarded Madam Leung $18,000 damages for pain, suffering and loss of amenities. This part of the award is not attacked.

4. Madam Leung had been employed as an amah, and in reaching a figure upon which to base an award in respect of her loss of earnings, the Commissioner decided that he should set $500 per month as the value of the food and accommodation she was getting from her previous employment. The Appellants say that this assessment is wrong. The Commissioner recognised that this item was not easy to assess but having accepted that Madam Leung had been contributing $500 a month to the household expenses of her son's home where she had been living since her discharge from hospital, he said "I do not consider that sum to be unreasonable, and I am prepared by analogy to use that figure as a fair estimate of the value of the food and accommodation she was receiving monthly." I acknowledge that the Commissioner's task was difficult but am quite unable to say that he was wrong in his assessment. Like him, I find the sum of $500 a month (whether it happens to represent the amount she is now paying her son or not) is an entirely reasonable estimate, and I would not accept that ground of appeal as a valid one.

5. The Appellants also challenge the Commissioner's finding that Madam Leung, had she not been injured, would have been able to work as an amah until the age of 70. This finding, of course, affects the multiplier adopted by the Commissioner. Dr. Wedderburn had stated that there was no reason why she could not have gone on working full time as an amah until she reached that age, but for the accident. The Respondent herself did not give evidence as to her intentions, but in my view the Commissioner was perfectly justified in taking a broad view of the case and deciding that there was no reason why she should not have gone on working as an amah at least until she was 70, had she not been injured. It is a matter of common knowledge that Chinese ladies who are amahs do go on working to an advanced age, and some of us are grateful for that. I find no merit in this ground of appeal.

6. The next ground of appeal we have to consider is put in this way -

"That the learned judge wrongly adopted a multiplier of 6 in addition to the 18 months pre-trial loss of earnings which she sustained, and did not give a substantial discount for the fact that the Plaintiff was 62 at the date of the accident and/or that for part of the remainder of her working life it would have been possible and/or probable that she would only work part-time."

7. Mr. Mumford, for the Respondent, reminded us of what Lord Wright had to say in the leading case of Davies v. Powell Duffryn Associated Collieries Ltd. [1942] A.C. 601, at p.616 -

"It is difficult to lay down any precise rule which will cover all cases, but a good general guide is given by Greer L.J. in Flint v. Lovell [1935] 1 K.B. 354, 360. In effect the court, before it interferes with an award of damages, should be satisfied that the judge has acted on a wrong principle of law, or has misapprehended the facts, or has for these or other reasons made a wholly erroneous estimate of the damage suffered. It is not enough that there is a balance of opinion or preference. The scale must go down heavily against the figure attacked if the appellate court is to interfere, whether on the ground of excess or insufficiency."

8. In choosing the multiplier, the Commissioner said no more than this -

"I am satisfied that the plaintiff is presently 62 years old and but for the accident, she would have been able to work until the age of 70, that is another 8 years. For the purposes of assessing her future loss of earnings I would adopt a multiplier of 6, making the usual allowances for the vicissitudes of life and the fact that she is getting a lump sum."

9. I must confess that at first, in the light of some other cases, I had formed the impression that the multiplier was too high for a lady of the Respondent's age, and in view of the length of her possible working life, as found by the Commissioner. However, I am persuaded by Mr. Mumford's submissions, and although perhaps the figure of 6 as a multiplier is higher than one I would have chosen myself, I feel it would be wrong to interfere with the Commissioner's finding in this particular case. I do think that it is right to guard ourselves against adopting too mathematical an approach to these matters. On the evidence as a whole (and it must be said that the Commissioner tried the case with anxious care and gave a full and well-reasoned judgment) I am not inclined to interfere with his choice of a multiplier.

10. The Appellants' next complaint is the inclusion of $1,000 in the special damages awarded in respect of bonesetter's fees. It is said that no receipts were produced. It is also said that this sum should not in any event have been allowed because "the bonesetter was consulted at a time when she was offered physiotherapy treatment but did not accept the offer of such treatment until a later date." Mr. Faulkner was not responsible for the drafting of the Notice of Appeal and did not seek at all strenuously to urge upon us the contention that the Commissioner was not entiled to believe the Respondent when she said she had spent $1,000 on these fees despite the fact that she had produced no receipts. After all she was not cross-examined on the matter and it was never suggested that the Court would be invited to disbelieve her as to the fact of paying money to the bonesetter and the amount she said she had paid. It was a matter for the judgment of the trial judge, within the principles laid down in the authorities, as to whether or not to award a Chinese lady the fees she had spent on a bonesetter, a form of treatment which more sophisticated people might well feel was not necessary. The Commissioner had ample evidence before him that Madam Leung did think it was necessary and did hope it would do her some good. I find no warrant for interfering with that part of the award.

11. The Commissioner awarded interest at 2% on the $18,000 general damages for pain, suffering and loss of amenities, from the date of the service of the writ until the date of his judgment. By a Respondent's Notice, we had been asked to increase the rate of interest to 14%, but Mr. Mumford did not seek to pursue this point. It will be recalled that the judgment appealed against was delivered on the 26th February 1983. On the 24th March, one of the Divisions of this Court gave judgment in Wong Yuk Chau and Another v. Tang Suk Yee (Civil Appeal No. 13 of 1983, so far unreported). In that case (and it was I who delivered the judgment of the Court) we declined to follow Birkett v. Hayes [1982] 1 W.L.R. 816 (which the Commissioner obviously had in mind when he awarded interest at the rate of 2%) and suggested that the guideline to be applied in Hong Kong should be that interest on general damages for pain, suffering, loss of amenities and loss of expectation of life should continue to be at what we called "the full economic rate". After discussing Birkett v. Hayes and Pickett v. British Rail Engineering Co. Ltd. [1980] A.C. 136 this is what I said -

"In our respectful judgment, to follow Birkett's case would be to put a gloss upon the decision, and the reasons for it, of the House of Lords in Pickett's case, a decision by which (in view of the similarity of the relevant statutes and principles) we are bound. We can see nothing in the latter case that would justify a general approach to the award of interest (and thus to the rate of interest) upon general damages depending upon whether they are given in personal injuries cases or in other cases where general damages are awarded. Again, with respect, we can perfectly understand the views of those who consider it inappropriate to award interest at all upon amounts which are generally regarded as conventional sums but we think that this must now be regarded as a matter for the legislature. For the present, therefore, we consider that the guideline to be applied in Hong Kong is that interest on general damages for pain, suffering, loss of amenities and loss of expectation of life should continue to be at the full economic rate. We emphasise that this is only a guideline and judges are free to exercise the discretion given to them by the statute. In particular we would mention that it would clearly be justified to consider reducing the period for which interest is awarded (from the date of service of the writ to the date of trial) or making a downward adjustment of the rate of interest, where the plaintiff has been responsible for unjustifiable delay in prosecuting his action.

It will be appreciated that since the instant case only concerned the award of interest for loss of expectation of life, what we have ventured to say about the rate of interest for pain, suffering and loss of amenities must be considered as obiter."

12. Since our decision, the House of Lords in Wright v. British Railways Board [1983] 3 W.L.R. 211 has decided that, in England, the rate of 2% interest to be awarded on damages for non-economic loss laid down as a guideline in Birkett v. Hayes remained appropriate until the long-term trend of inflation became predictable with more confidence. Although the rates of inflation in Britain and in Hong Kong have not been the same, it would not be right, in my view, to seek to distinglish the decision of the House of Lords; I can say that we would not have laid down a different guideline for Hong Kong had their Lordships decision been made before we addressed the matter. Bearing in mind what was said by the Privy Council in de Lasala v. de Lasala [1980] A.C. 546, I regard Wright v. British Railways Board as having the same practical effect as if it was strictly binding on this Court (see the opinion of Lord Diplock at p.558 of the report in de Lasala). This is because the legislative provisions which require interest to be awarded, and the principles upon which the rate of interest is assessed, are the same in Britain and in Hong Kong, although, as I have said, there have been differences in the rates of inflation. Our decision in Way Yuk Chau was clearly wrong and the guideline therein stated must be corrected at the first opportunity which presents itself, which is the current appeal. It is fortunate, perhaps, that it has only been in force for about four months. In my judgment the new guideline should be that the rate of interest to be awarded in personal injury actions on damages for non-economic loss should be 2%, subject to the discretion we emphasised in Wong Yuk Chau. It was, of course, the House of Lords decision that prompted Mr. Mumford (if I may say so, very properly) to abandon the contention about interest in the Respondent's Notice.

13. For the reasons I have given I would dismiss the appeal.

Leonard, V.-P. :

14. I, too, would dismiss the appeal and for the reasons given with which I agree. I further agree with what has been said regarding the rate of interest.

15. At the risk of appearing to mount my favourite hobby-horse, I would like only to add this: that had this appeal been allowed, I should have found it necessary to make a special recommendation to the Taxing Master regarding the appeal bundle. There was only one question in issue here, quantum. Nevertheless when preparing the bundle of appeal, many documents not referring to quantum were included, as were copies of two judgments given in other cases. How these came to find their way into the record I do not know. The record then was far too long.

Cons, J.A.

16. I agree that the appeal should be dismissed and for the reasons given by my Lord, Fuad, J.A. I only wish to add as regards the question of the rate of interest which, as my Lord has pointed out, was no longer pursued in this appeal, that as at present advised, I cannot for myself envisage any circumstances peculiar to Hong Kong which are of sufficient significance to warrant our not following the decisions of their Lordships in the case of Wright v. The British Railways Board.

Representation:

Mr. R. Faulkner (J.S.M.) for the Appellants.

Mr. C. Mumford (D.L.A.) for the Respondent.