Chan Sik Pan v. Wylam's Services Ltd.

HCPI 648/1995

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 648 OF 1995

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Coram: Li DJ in Court

Dates of Trial: 13, 14, 28 and 29 December 1999

Date of Judgment: 3 February 2000

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J U D G M E N T

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This would be a mundane personal injury claim but for issues relating to employment of the plaintiff at the time of the accident. In view of the practical difficulties involved, by consent trial was split as to determination of liability first and quantum later with the hope that perhaps quantum could be agreed in due course by those held liable.

2.The circumstances of the accident are not controversial. On 21st August 1992, the plaintiff was employed as a fire installation technician. At about 2:30 p.m. that day, he and a colleague were standing on a platform erected on a staircase landing and each was using a pair of chain pliers to fix a fire duct on the ceiling above the landing. The chain pliers were like a wrench but the gripping action is produced by wrapping a chain from the pliers around the duct with the loose end of the chain locked by a pin accessory of the pliers. Somehow the locking mechanism failed and the chain come loose. The plaintiff who was applying force through this malfunctioning pair of pliers lost balance, fell over from the platform and landed somewhere down the steps. According to the colleague working with the plaintiff on the platform, he found the locking pin broken away from the plaintiff's pliers.

3.There is clear evidence that the platform on which the plaintiff was standing was of standard design commonly used in building sites. It was about 1.8 metre high from ground level. It had no railing around to prevent persons standing on the platform from falling off the platform. It was only about a year later that the authorities required such platform to have railings to prevent the kind of mishap the plaintiff experienced.

4.The plaintiff claims that his employers failed to provide a safe system of work, contrary to common law and statute, in that (1) the chain pliers were defective and (2) the platform had no guard railings.

5.There is some dispute over who should be responsible for the defective chain pliers and whether there was contributory negligence on the part of the plaintiff himself in using the pliers which he should have discovered on examination to be defective. I decide that the dispute is irrelevant because, taking into account all factors and circumstances, the cause of the accident is the lack of guard railings or fences for the platform. Had there been such railings, even when the plaintiff lost balance after the pliers broke, he would not have fallen from height. Clearly, the employers of the plaintiff failed to provide an adequately safe platform. None of the defendants pleaded that the plaintiff was himself negligent, or that the plaintiff accepted the risks of, working on the platform which had no guard railings.

6.In short, the plaintiff must be entitled to recover fully 100% loss and damage. The problem is: from whom?

7.It is not disputed that the site, Windsor House in Causeway Bay, was being re-fitted under a general contract. The general contractor had a main sub-contractor for electrical and mechanical work. This main sub-contractor further sub-contracted the fire installation work to the 1st defendant. According to the 1st defendant, it appointed one Joe Wong trading in the name of United Company as its agent for such work. Joe Wong on behalf of the 1st defendant "sub-delegated" part of work to the 2nd defendant. The 2nd defendant says that he sub-sub-contracted work to the 3rd defendant and so he (the 2nd defendant) had no relationship with the workers like the plaintiff. The 3rd defendant says he was at the material time not a sub-sub-contractor. He (the 3rd defendant) merely supervised the workers like the plaintiff and the work at site.

8.The plaintiff, as can be expected, had no idea as to all the contractual relationships between the defendants and other superior contractors. According to him, an old friend telephoned him about work available at the site. He went and reported to the 3rd defendant. He regarded the 3rd defendant as the foreman. It was the 3rd defendant who handed him wages in cash twice a month on pay day. The plaintiff had no dealing or knowledge of the other defendants until after the accident. It is undisputed fact that after the accident the 1st defendant filed a statutory industrial accident report ("Form II") with the Labour Department. This Form II is the form that an employer must file on every industrial accident that has occurred to a worker under his employ. After filing the report, months later, the 1st defendant twice reached a written agreement with the plaintiff on the amount of allowance payable under the Employee Compensation Ordinance, Cap. 282. And the allowance was paid to the plaintiff as agreed.

9.It was on the basis of the conduct of the 1st defendant aforesaid that those representing the plaintiff at first sued the 1st defendant as employer. When the 1st defendant pleaded in its defence that it had sub-contracted to the 2nd defendant, the 2nd defendant was joined. When the 2nd defendant pleaded in his defence that he had sub-sub-contracted to the 3rd defendant, the 3rd defendant was joined.

10.To complicate matters further, neither the 2nd defendant nor the 3rd defendant is covered by any employee compensation insurance. Only the 1st defendant took out compulsory employee compensation insurance; but because there is evidence that the 1st defendant sub-contracted work to other parties, the insurers of the 1st defendant deny that the plaintiff is covered by the insurance of the 1st defendant. In the circumstances, there is a distinct possibility that judgment to be obtained by the plaintiff may well be a hollow one. Be that as it may, it is my duty to decide on the law and facts and to do justice in the best way I can.

Employer's liability

11.In principle, employment relationship is founded on contract. Whilst employers may decide whether they want to hire any person, employees may also decide with whom they contract to work for. The facts of the instant case are not uncommon but they render analysis of employment relationship based on principles of contract artificial. It is unrealistic if not impossible to expect the plaintiff, a casual worker with very little education, to ascertain the multi-layer sub-contracting relationship between the defendants. There was hardly any consensus ad idem when the plaintiff had no idea who he was contracting with and when the defendants shifted the incidence of employment down the chain of sub-contracts.

12.As Mr Ng, counsel for the 1st defendant, submitted, "the question of who was at the material time the employer of [the plaintiff] is a question of fact to be determined by the trial court. The actual intention of the parties could not be conclusive, for they might not have achieved what they intended. Since it is for the court to determine the legal nature of the relationship between the parties, the parties' own description of the relationship is not determinative of their relationship." I think the proverbial reasonable man should be called into service. The reasonable man would say it was never the intention of the 2nd defendant or the 3rd defendant to hire the plaintiff when they were not covered by employee compensation insurance. Equally, the reasonable man would not believe it was the plaintiff's desire to be the employee of the 2nd defendant or the 3rd defendant when those two defendants were not covered by insurance. The 1st defendant, having taken out employee compensation insurance, must be deemed to be the employer; there was no point for the 1st defendant to take out such insurance if it did not intend to hire workers.

13.Moreover, the Employees' Compensation Ordinance, Cap. 282 provides that

" 40. (1) No employer shall employ any employee in any employment unless there is in force in relation to such employee a policy of insurance issued by an insurer for the full amount of the liability of the employer under this Ordinance and independently of this Ordinance for any injury to such employee by accident arising out of and in the course of his employment.

.......

41. (1) Subject to subsection (2), an employer to whom a policy of insurance is issued for the purposes of this Part shall display, in a conspicuous place on each of his premises where any employee is employed by him, a notice, in such form as may be specified by the Commissioner, showing in both the English and Chinese languages-

(a) the name of the employer;

(b) the name of the insurer;

(c) the policy number;

(d) the date of issue of the policy;

(e) the dates of commencement and expiry of the period of insurance;

(f) the number of employees insured under the policy at the time of issue thereof; and

(g) the amount of the liability insured."

Because those two defendants without compulsory insurance could not employ any one, it is not open to the court in the cirumstances of this case to find that the 2nd defendant or the 3rd defendant was the employer of the plaintiff.

14.In the premises, I find that there was contract of employment between the plaintiff and the 1st defendant. On this basis, clearly the 1st defendant breached its duty of care towards the plaintiff its employee in failing to provide guard rails or fences on the working platform from which the plaintiff fell.

Liability by Estoppel

15.The plaintiff pleaded in his Reply estoppel in the following manner:-

"the Plaintiff will contend that the 1st defendant is estopped from denying that the Plaintiff was employee of the 1st Defendant because by a statutory document "Form 2" dated 8th October 1992, an agreement between the plaintiff and the 1st Defendant dated 14th January 1993 and an agreement between the Plaintiff and the 1st Defendant dated 26th May 1993, the 1st Defendant recognised and admitted that the Plaintiff was its employee, and that such recognition and admission were made to the Plaintiff with the intention that the Plaintiff should act on them, which the Plaintiff did do."

16.As far as the Form II filed and payments under the Employees Compensation Ordinance, Cap. 282 made by the 1st defendant are concerned, it is quite clear that no estoppel arises. See Ho Mui v. Gammon (Hong Kong) Limited and another [1975] HKLR 195 and Li Kwai Fong Ah Pat v. Bachy Soletanche Group and another, Civil Appeal No. 30 of 1989.

17.I would have thought that the 1st defendant by sub-contracting to the 2nd defendant without ensuring that the 2nd defendant or a sub-sub-contractor under the 2nd defendant has taken out compulsory insurance and by displaying notice of insurance which the 1st defendant was bound to do under Section 41 of the Employee Compensation Ordinance, Cap. 282, the 1st defendant would be estopped from denying that it is the employer of the workers working under the 2nd defendant or the 2nd defendant's sub-sub-contractor. However, this is not the basis on which estoppel is pleaded. Hence, I am bound to find that there is no estoppel.

Contractor's liability

18.The plaintiff at the commencement of trial sought leave to re-re-amend the Statement of Claim to include, inter alia, the following cause of action:-

"4A.	Further or in the alternative the injuries were caused by the breach of regulation 38N of the Construction Sites (Safety) Regulations Cap. 59 of the Defendants.
	Particulars
	Being contractors responsible for the site failed to provide a guard rail to a height between 900 millimetres and 1,150 millimetres when the Plaintiff was liable to fall a distance of more than 2 metres."

19.Now, this part of the re-re-amendment refers to contractor's responsibility. It is arguably not based on employment relationship but on the statutory duty of a contractor. It is a new cause of action. Mr Ng for the 1st defendant and the 3rd defendant in person did object. But the ground of objection was that it was late in the day giving the defendants insufficient time to prepare their case to meet this new allegation. The objection was not based on statute bar under the Limitation Ordinance, Cap. 347. Thus, I allowed the re-re-amendment, adjourned the trial for two weeks and gave leave to the defendants to put forward consequential amendments if they see fit. As it turned out, none of the defendants amended their defence to plead statutory bar to the new cause of action. Since statutory bar has to be specifically pleaded to be effective, I am therefore bound to consider this additional cause of action.

20.Assuming that the 1st defendant had a statutory duty as pleaded and breached that duty, it is beyond dispute that the 1st defendant would be liable to the plaintiff even if the plaintiff is not an employee of the 1st defendant. This is because by imposing a statutory duty on the "contractor" to provide a guard rail, the intention of the legislature clearly intends to fix liability on the contractor to comply with safety regulations.

21.Mr Ng for the 1st defendant referred to A.G. v. John Lok & Partners & etc. [1986] HKLR 325 for the meaning and purpose of the Construction Sites (Safety) Regulations, Cap. 59. Mr Ng also contended that since the working platform was on the evidence of the height of 1.8 metres only, the case is not caught by Regulation 38N.

22.Dealing with the technical point first, Regulation 38N actually requires guard rail on "a side from which a person is liable to fall a distance of more than 2 metres". Whether a person is liable to fall a distance of more than 2 metres is not determined by the height of the platform; one must take into account where the platform is positioned. If the platform is placed on the ledge of the roof-top of Hopewell Centre, the person working on the platform is liable to fall down a hundred times of 2 metres. In the present case, the platform was on a staircase landing, the plaintiff actually fell downstairs for more than 2 metres.

23.A.G. v. John Lok & Partners & etc. is prima facie a mixed blessing for the plaintiff. In that case, Hooper J held that the contractor liable need not be the contractor actually working at the site. In this respect, the 1st defendant who appointed an agent and sub-contracted to the 2nd defendant is still caught with liability. However, the learned judge also held that only the principal contractor for the whole site could be liable because Regulation 2(2) of the Construction Sites (Safety) Regulations, Cap. 59 says that:-

"For the purposes of these regulations-

(a)	a contractor is responsible for a construction site if he is undertaking construction work there or, where there is more than one contractor undertaking construction work at the site, if he is the principal contractor undertaking work there;
(b)	a contractor is responsible for any plant referred to in these regulations if it is located at a construction site for which he is responsible."

24.With respects, I cannot go along with the view of Hooper J. The word site ought to be given a purposive interpretation. There is nothing on the face of it to treat site as the whole construction site. It may be an area within a larger site although work is being carried out everywhere inside the site. The principal contractor for the area may be held liable. In this case, the 1st defendant was the principal contractor for the site where the plaintiff was working.

25.Moreover, Regulation 2(2)(b) refers to plant for which the contractor is responsible. The plaintiff was using a working platform for the work undertaken by the 1st defendant. Even though the platform did not belong to the 1st defendant and it was the plaintiff who put up the platform, the 1st defendant must be deemed responsible for the platform as plant within the meaning of Regulation 2(2)(b).

Liability

26.For the reasons given, the 1st defendant is solely liable as employer and contractor for negligence and breach of statutory duty respectively for failing to provide guard rails on the working platform. The 1st defendant has not pleaded contributory negligence in this regard. It was meaningless for counsel for the 1st defendant to extract from the plaintiff in the witness box a casual admission that the plaintiff would not have put up guard rails had such been provided. There were no guard rails provided as a matter of fact and as a matter of pleading the 1st defendant cannot assert contributory negligence. Liability, therefore, is unmitigated. There is accordingly judgment for the plaintiff against the 1st defendant for 100 per cent liability. The claim against the 2nd and 3rd defendants is dismissed. There is order nisi that the 1st defendant bears the costs of the plaintiff in this action, including the costs of pursuing the 2nd and 3rd defendants and the costs of the adjourned trial, such costs to be taxed if not agreed. The order nisi to become absolute unless application is made within 14 days for variation or otherwise. The plaintiff's own costs is to be taxed in accordance with legal aid regulations.

27.Counsel for the plaintiff and the 1st defendant indicated that the remaining parties may well be able to agree on quantum. I hope that aspect of the case will be soon if not already taken care of.

Representation:

Mr Tim Kwok, instructed by Messrs Yen, Yu & Kong, for the plaintiff

Mr Ng Man Sang Alan, instructed by Messrs Charles Yeung, Clement Lam & Co., for the 1st defendant

2nd defendant in person

3rd defendant in person