Chan Chi Shing v. Chan Shu Kuen and Another

DCEC 785/2005

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES' COMPENSATION CASE NO. 785 OF 2005

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In the matter of an Application between:-

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Coram: Deputy District Judge W.C. Li in Court

Date of Trial: 5^th October 2006

Date of Handing Down Judgment: 10^th October 2006

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JUDGMENT

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1.The Applicant was a painting worker who was asked to do painting work for the 1st Respondent. He had worked for the 1^st Respondent on previous occasions and he was paid a daily wage of $750. On average, the Applicant worked 26 days in a month. He testified that the 2^nd Respondent was the principal contractor in this case and the 1^st Respondent gave him the instruction of the work required to be done and where to do it. He testified that he was either paid half monthly or monthly, and at the time of the accident on 5^th February 2004, he had not yet received his pay. Both the 1^st and 2nd Respondents had paid him his wages in the past. After the accident, the 1^st Respondent paid his outstanding wages by transferring the money into his bank account. The 2^nd Respondent had also paid him on 3 occasions a total of $40,000 for his living expenses and the Applicant agreed that this amount should be accounted for and be deducted from the amount of employee's compensation he were to receive under the Employees Compensation Ordinance, Cap. 282 (“the Ordinance”).

2.The Applicant was injured in an accident on 5^th February 2004 when he was doing painting work and fell off a working scaffold that had collapsed in the garage of Tsing Shan Wan Exchange in Tuen Mun, New Territories (“the site”), a property managed by PCCW Properties (HK) Limited (“PCCW”). The work at the site was contracted out by PCCW to the 2^nd Respondent who sub-contracted the work to the 1^st. Respondent. The Applicant suffered a fractured right Calcaneum of his right ankle and also back injury resulting in back pain and stiffness from the fall. The Employees' Compensation Assessment Board assessed the permanent loss of earning capacity of the Applicant to be at 9%. The Applicant lodged an appeal against this assessment. The assessment of 9% disability was re-affirmed and the Applicant accepted this assessment at the trial. Both the 1^st. and 2^nd Respondents denied liability in their Defence and put the Applicant to strict proof thereof.

3.The 1^st Respondent appeared in person and the 2^nd Respondent was absent for the trial. The 1^st Respondent did not file a witness statement for his defence. His argument was that he was only a foreman and not a sub contractor of the 2^nd Respondent. He denied that the Applicant was his employee. He gave oral testimony in the trial and reiterated that he was only a foreman of the 2^nd Respondent and was not the employer of the Applicant.

4.In the Accident Investigation Report of Mr. Lau Kwok Ming, Safety Officer I, of the Labour Department, the investigation been done on 6^th February 2004, the 1^st Respondent was found to be the Applicant's direct employer and the 2^nd Respondent was found to be the principal contractor of PCCW. The working scaffold from which the Applicant fell was found to have been assembled and put to immediate use without having been first inspected by a competent person, and the Applicant fell off from the top tier that was about 12 feet above the ground. The working scaffold belonged to the 2^nd Respondent and there were also working ladders found on the site with the name of the 2^nd Respondent written on them.

5.In the Declaration of Truth of Mr. Mo Kin Chung dated 3^rd October 2004, Mr. Mo, an Assistant Facilities Manager of PCCW, declared that the painting work at the site was contracted out to the 2^nd Respondent. The 2^nd Respondent was therefore the main contractor of the site.

6.The 2^nd Respondent was summonsed before Tuen Mun Magistracy on 8^th July 2004 as the principal contractor responsible for the accident on the site. The 2^nd. Respondent pleaded guilty and was fined $10,000 by the court. 

7.The 1^st Respondent made a Declaration of Truth on 26^th March 2004. He declared the following:  (1) that he sub-contracted the work on the site from the 2^nd Respondent; (2) on completion of the work, the 2^nd Respondent would pay him a lump sum payment; (3) he was responsible for employing workers including the Applicant to work on the site and the workers were daily paid; (4) the 2^nd Respondent provided the scaffold and the ladders and he bought the paint; (5) he supervised the workers in their daily work, and  (6) that he undertook the work from the 2^nd Respondent in his own capacity.

8.In the trial, the 1^st Respondent testified that he was misled by the Labour Officer and he had signed the Declaration of Truth without reading and knowing its contents. His defence was that he was a foreman, an employee of the 2^nd Respondent, and not a sub contractor who had employed the Applicant. He later testified that the Declaration of Truth and its content were in fact true. He said the Labour Officer had asked him to read the declaration and to see if the contents therein were correct, if so, he were to sign it. He confirmed that he had read the contents in the declaration before he signed his name on it. It was obvious to me that the 1^st Respondent was being untruthful when he first denied having knowledge of the contents of his declaration. He later contradicted himself when he confirmed that he had in fact read the declaration and he had been told by the Labour Officer that he were to sign it if he was satisfied that its contents were true and correct. He did read the declaration and he did sign it. I had no doubt that the 1^st Respondent had made the Declaration of Truth out of his own freewill and its contents were true and accurate. I did not find the 1^st Respondent truthful in his evidence that he was a foreman and not the Applicant's direct employer. To the contrary, there was overwhelming evidence to show that the 1^st Respondent was a sub contractor of the 2^nd Respondent and he had employed the Applicant to work for him.

9.The evidence had shown that the Applicant worked directly for the 1^st Respondent and also for the 2^nd Respondent who was the principal contractor of the site. The accident was caused when the working scaffold that was provided by the 2^nd Respondent collapsed and the Applicant fell to the ground injuring his right ankle and back. The scaffold was set up and put to immediate use without prior inspection by a competent person. On liability, I therefore find that the accident and the Applicant's injuries arose out of and in the course of the Applicant's employment with the 1^st and 2^nd Respondents.

10.The Applicant's evidence on quantum was not challenged by the 1^st Respondent in the trial. The Applicant was put to strict proof thereof.

11.The Applicant worked 26 days a month and was paid $750 for each day's work. His permanent loss of earning capacity due to the injuries was assessed at 9% and he was then aged 45, born on 2^nd May 1958. The “Multiplier” for a man of his age under Section 7 of the Ordinance is 72 months. The amount of compensation payable under Sec. 9 would therefore be $19,500 ($750 X 26) X 9% X 72 =  $126,360.00.

12.The Applicant was given sick leave of a total of 426 days. Sick leave certificates from 5^th February 2004 to 16^th December 2004, and from 20^th December 2004 to 7^th April 2005, and 5^th May 2005 were shown to the court for verification. The amount of compensation for temporary incapacity under Section 10 of the Ordinance would therefore amount to $19,500 X 4/5 X 426/26 = $255,600.

13.The receipts for medical expenses incurred by the Applicant after the accident had also been produced to the court for verification. The charge for the Tuen Mun Hospital at the Accident and Emergency Unit was $100. The costs of hospitalization from 5^th February 2004 to 16^th February 2004, and from 7^th March 2005 to 9^th March 2005 amounted to $1,550. Physiotherapy at the Yan Chai Hospital amounted to $1,257. The cost incurred at the Tuen Mun Orthopaedics Unit was $500. The total claim under this head amounted to $3,407.00.

14.The aggregate of the Applicant's claim under Sections 9, 10 and 10A of the Ordinance therefore amounted to $385,367.00.

15.Credit is given to the $40,000 paid by the 2^nd Respondent to the Applicant for his living expenses after the accident. The Applicant agreed to have this sum deducted from his total claim. I therefore order that judgment be entered in favour of the Applicant against the 1^st and 2^nd Respondents for $345,367.00. I order interest at half judgment rate, i.e. at 5.5% p.a., be paid by the 1^st and 2^nd Respondents to the Applicant on the said judgment sum of $345,367.00 from the date of the accident, i.e. 5^th February 2004, to the date of judgment of the date hereof. I also order interest at judgment rate to be paid by the 1^st and 2^nd Respondents to the Applicant from the date of judgment to the date of full payment of the judgment sum of $345,367.00.

16.As to the costs of this action, I order that the 1^st and 2^nd Respondents are to pay the Applicant's costs of this action, to be taxed if not agreed, with certificate for counsel. This is a cost order nisi to be made absolute in 14 days' time.

Representation:

Miss Flora Cheng instructed by Director of Legal Aid for the Applicant

1^st Respondent, Chan Shu Kuen, appeared in person

2^nd Respondent, Wan Kee Engineering Co., Limited, was absent from the trial