Lung Kwong-hung Thomas v. Chan Yau-yik and Another

DCCJ010877/1980

IN THE DISTRICT COURT OF HONG KONG

HOLDEN AT KOWLOON

CIVIL JURISDICTION

ACTION NO. 10877 OF 1980

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Coram: A.L. Leathlean, D.J.

Date of Judgment: 14th Day December, 1981.

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JUDGMENT

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1. Quantum apart, the only issue in this case is whether the 1st defendant owner is vicariously liable for the negligence of the 2nd defendant driver. It is admitted that the 1st defendant was the registered owner of the vehicle in question at the material time. A Mr. CHU Sik-choi and a Mr. WONG Ho-kwong of the Hong Kong Public Light 'Bus Trading Co., Ltd., have give evidence for the 1st defendant. I find the facts as follows: The company was formed in or about 1977, and advertised in the local press in the "Employment" columns in more or less the following terms:

"Our company employs experienced public light 'bus drivers. We invite experienced public light 'bus drivers to come to our company and register them-selves and we will hire out public light 'buses to them"

followed by the name, address and telephone number of the company. Meanwhile, as a result of this advertisement and subsequently through the introduction of those drivers who were attracted by it the company built up a reservoir of 'bus drivers. The owners of the 'buses paid the company $200 a month "management fee". The drivers paid the company $67 or $73 a shift, and those payments were made over to the owners by the company. The drivers put all their takings into their own pockets. Normally each 'bus was allocated to a particular driver. It was entirely up to the drivers if, when and where they plied for hire. However, they were required to give the company three days' notice of their intention not to drive, in default of which they forfeited the sum which would have been charged had they driven. If they gave notice a substitute driver would be found - according to Mr. Wong, whose evidence as to this and everything else I prefer to Mr. Chu's, with which it conflicts in a number of respects, by the company. If a 'bus was damaged the driver for the time being was responsible for the cost of repairs. The "management fee" covered the provision of spare tyres and cleaning services. The drivers paid for the fuel which they used. The owners paid the insurance premiums.

2. The 1st defendant's case appears to be largely that inasmuch as all these arrangements were made by the company he is not liable for the 2nd defendant's negligence. In my judgment that cannot be so. Indeed, as I mooted during argument, I believe that for all present practical purposes the company is nothing more than a "red herring". I strongly suspect that there is abroad among public light 'bus owners and, perhaps, their insurers, a belief that liability may be evaded by the expedient of engaging an entity such as the Hong Kong Public Light 'Bus Trading Co., Ltd., to "manage" their buses for them, but in my view liability is not to be evaded by the interposition of any number of such entities between them and those who drive their 'buses, and the test must be: If the owner himself had made the arrangements directly with the driver instead of through an intermediary would he have been liable for the driver's negligence? If the answer to that is "Yes" then, as I say, it matters not how many intermediaries there are, and if the answer is "No" then the interposition of "managers" is an exercise in futility. So, I hold, the question really is: Had the 1st defendant made the arrangements which he made through the Hong Kong Public Light 'Bus Trading Co., Ltd., directly with the 2nd defendant would he have been liable for the latter's negligence?

3. Mr. Leigh for the 1st defendant owner has referred me to Bingham's Motor Claims Cases, 8th (1980) edition, pages 135-138, and in particular to the cases of Ready Mixed Concrete, Ltd. v. Ministry of Pensions⁽¹⁾ and a case decided by the National Industrial Relations Court reported in the "Times" newspaper of December 22nd, 1971, mentioned there.

4. These cases, however, are only concerned with the question whether the relationship of master and servant existed between owner and driver. But, with respect to Mr. Leigh, suppose that that relation-ship did not exist between the 1st defendant owner and the 2nd defendant driver, it would not necessarily follow that the former was not liable for the negligence of the latter. The law is, I think, succinctly and accurately stated in the judgment of Sir Clement de Lestang, V.P., in the case of Selle et al. v. Associated Motor Boat Co., Ltd., et al.⁽²⁾, thus:

"As I understand the law the fundamental and well settled rule is that a person employing another is not liable for his collateral negligence unless the relation of master and servant existed between them at the material time (Quarman v. Burnett (1940) 6 M. & W. 499; Dalton v. Angus (1881) 6 A.C. 740 at 829). It follows from this rule that the relation-ship of principal and agent will not in itself suffice to render the principal liable for the collateral negligence of the agent unless the agent is also a servant."

But he went on to say:

"Where however, a person delegates a task or duty to another, not a servant, or employs another, not a servant, to do something for his benefit or the joint benefit of himself and the other, whether the other person be called agent or independent contractor, the employer will be liable for the negligence of that other in the performance of the task, duty or act as the case may be (Hewitt v. Bonvin; Ormrod v. Crosville Motor Services, Ltd."

Hewitt v. Bonvin⁽³⁾ and Ormrod v. Crossville Motor Services, Ltd.⁽⁴⁾ are still good law - see Rambarran v. Gurrucharran⁽⁵⁾ and Morgans v. Lanchbury⁽⁶⁾.

5. Let us, therefore, apply the latter part of the statement to the facts of the instant case, and ask the question "Did the 1st defendant owner delegate a task to the 2nd defendant driver to do something for his (the 1st defendant's) benefit?" Undoubtedly the 1st defendant did delegate the task of driving his 'bus to the 2nd defendant, albeit through the Hong Kong Public Light 'Bus Trading Co., Ltd., Who "found" the 2nd defendant for him. Was the driving of the 'bus for the 1st defendant's benefit? I think that I may safely assume that no one purchases and licences a public light 'bus for any other purpose than that it shall ply for hire with a view to his enrichment. And whether such enrichment takes the form of hiring charges or some other form seems to me to be altogether immaterial.

6. In my judgment the 1st defendant owner is liable for the negligence of the 2nd defendant driver.

7. Dated this 14th day of December, 1981.

Representation:

(1) (1968) 2 Q.B. 497

(2) (1968) East African Reports 123 at 128

(3) (1940) 1 K.B. 188

(4) (1953) 2 All E.R. 753

(5) (1970) 1 All E.R. 749 P.C.

(6) (1973) A.C. 127 (H.L.)