Law Yim Kwan v. China Insurance Company Limited
Read the full judgment text of HCA 6845/1986 on BabelCite. This High Court CFI judgment.
1. On 14 March 1980 King Man industrial Co. Ltd. ("the Insured") entered into an employer's liability insurance agreement with the Defendant. The material terms of the agreement read as follows:-
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HCA006845/1986
IN THE SUPREME COURT OF HONG KONG HIGH COURT ------------------- BETWEEN
------------------ Coram: Barnes, J. Date of hearing: 17th September, 1987 Date of delivery of judgment: 25th September, 1987 ___________ JUDGMENT ___________ 1. On 14 March 1980 King Man industrial Co. Ltd. ("the Insured") entered into an employer's liability insurance agreement with the Defendant. The material terms of the agreement read as follows:-
2. The premium payable under each policy was duly paid by the Insured. On 27 December 1980, within the period of insurance under each policy, the Plaintiff's right hand was crushed by a plastic injection moulding machine in the course of his employment by the Insured. He was subsequently awarded compensation in the sum of HK$79,327.11 under the Employees' Compensation Ordinance and this was duly paid to him by the Defendant. 3. On 31 July 1981 the Insured was compulsorily wound up whereupon the Plaintiff became entitled, pursuant to the provisions of s. 2(1)(b) of the Third Parties (Rights Against Insurers) Ordinance, to enforce whatever rights the Insured had against the Defendant under each of the aforementioned policies. 4. On 1 November 1983 the Plaintiff instituted proceedings against the Insured claiming damages at common law in respect of the accident. Damages in the sum of HK$378,350.00 were subsequently assessed and awarded in those proceedings. 5. In this action, the Plaintiff claims $299,022.89 ($378,350.00 - $79,327.11) if the Defendant's maximum liability is $300,000 or $150,000 if $150,000 is the maximum. 6. The Defendant contends that $150,000 is the maximum amount of its liability but that the amount paid pursuant to the Employees' Compensation Ordinance must be deducted leaving a total liability of $70,672.89. There is, however, no merit whatsoever in the "deduction" contention. The limitation endorsements do not relate to the combined liability in respect of Employees' Compensation Ordiance liability and common law liability but only to the latter. The only question therefore is: is the Plaintiff entitled to the larger or the smaller of his alternative claims? 7. No evidence was adduced at the trial. The parties have agreed to the issue being determined on the pleadings, the documents and counsel's submissions. 8. The Plaintiff's pleadings add nothing to what has been set out earlier. Apart from the contention which has already been rejected, the Defendant's pleadings admit the Plaintiff's averments but then aver as follows:- ".... that:-
9. The only documents relied on by the parties were the two policies, the material terms of which have been set out above. 10. Counsel, in their submissions, agreed that my task was to determine the intention of the parties by construing the two policies. 11. The Plaintiff's accident occurred at a time when the Insured was covered by two policies in respect of the same liability risk. The Defendant's pleadings clearly indicate that there was dual cover and that the second policy was not in substitution for the first. Why then was there a need for two policies "collectively" to cover "all the employees of the [Insured]"? 12. The two policies would "collectively" cover all the Insured's employees only if each was identified with a separate risk. Each, however, covers all employees in respect of the same type of liability. One can, therefore, find a separate risk in each policy only by construing the first as covering a liability risk to a ceiling of $150,000 and the second to cover a risk of liability above $150,000 to a ceiling of $300,000. I therefore conclude that the Insured was covered to a maximum of $300,000. 13. There will accordingly be judgment for the Plaintiff in the sum of $299,022.89 together with interest thereon at the rate of 10% per annum from 2.12.83 (the date of service of the writ in this action) until today, and costs. 14. I order that the Plaintiff's own costs be taxed under the Legal Aid (Scale of Fees) Regulations.
Representation: Mr. Patrick Fung (Tai, Ho & Chan) for the Plaintiff. Mr. Alexander Wong (Ford, Kwan & Co.) for the Defendant. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||