Chung Yuen Yee v. Sam Woo Bore Pile Foundation Ltd and Others

CACV 145/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 145 OF 2010

(ON APPEAL FROM HCPI 1053 OF 2006)

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BETWEEN

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Before : Hon Cheung CJHC, Tang VP and Cheung JA in Court

Date of Hearing : 8 July 2011

Date of Judgment : 22 July 2011

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J U D G M E N T

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Hon Cheung CJHC :

1.I agree with the judgments of Tang VP and Cheung JA.

Hon Tang VP：

2.I have had the advantage of reading the judgment of Cheung JA in draft.  I agree with it.  I wish, however, to add a few words on the finding of contributory negligence against the deceased.

3.It is clear from the evidence that the deceased and Mr. Lam, the driver crane operator, were expected to carry out the lifting of the forklift truck.  Mr. Lam had to man the lorry so essentially the deceased was left on his own. 

4.The expert report of IR Dr Lam Siu Shu Eddie, stated at para. 5.3C that the trade practice was that two workers:

‘ … would be around at the two sides of the Forklift Truck to balance/control the Horizontal Force ….’

5.This is accepted and is no more than common sense.

6.Dr. Lam went on to say in the same paragraph:

‘ … With only one worker, i.e. the deceased, at the material time, the Deceased had to stand in front of one side of the Forklift Truck, i.e. at the space between the Forklift Truck and the side-wall in order to balance/control the Horizontal Force …’

7.As IR Dr. Jonathan C. Y. Chung, who conducted an experiment on 10 June 2005 to simulate the lifting of the forklift truck, said swinging or turning movement was to be expected when lifting the forklift truck.  See paras. 5.3.3 to 5.3.5 of his expert report dated 2 February 2008.

8.Mr. Coleman sought to rely on what Dr. Lam said in para. 5.2(d) of his report:

‘ Mr. Lam indicates that the Accident occurred when the Forklift Truck was lifted to about 2 to 3 inches above the sideboard of the lorry (Mr. Lam’s 1st declaration 3:18). Therefore, it is likely that any “swinging or turning movement” was minimal and state of equilibrium was maintained.’

9.However, Mr. Lam’s oral evidence (transcript pages 16-17) was that the accident occurred when he had lifted the forklift truck by about 5 feet.  Also whether ‘ “any swinging or turning movement” was minimal and state of equilibrium was maintained’ must depend on Mr Lam’s skill.  The evidence was that Mr. Lam had no relevant experience.

10.It is clear that the deceased was required to carry out a hazardous task on his own (when more than one person was required), without proper supervision, and with inappropriate and defective chains.  A situation envisaged by Goddard LJ in Hutchinson v London & North Eastern Railway Co [1942] 1 KB 481 when he said :

‘ … It is only too common to find in cases where the plaintiff alleges that a defendant employer has been guilty of breach of a statutory duty, that a plea of contributory negligence has been set up. In such a case I always directed myself to be exceedingly chary of finding contributory negligence where the contributory negligence alleged was the very thing which the statutory duty of the employer was designed to prevent. The real incentive for the observance by employers of their statutory duties … is not their liability to substantial fines, but the possibility of heavy claims for damages. Such legislation would be nugatory if, in every case, employers could disregard the statute, and allege that, although they did not provide a look-out or a guard or a fence, as the case might be, nevertheless the plaintiff could see the danger and, therefore, ought to have ceased working, which in many cases might mean dismissal, or to have taken some extra precaution which was not taken.’ at p.488.

11.In a case involving hazardous work and where the employers provided no supervision, inappropriate equipment, indeed defective equipment, and an inadequate work force, I believe the facts will have to be very unusual to justify a finding of contributory negligence.  This is not such a case.  Contributory negligence against a workman is more appropriately found in cases where a worker might have worked safely, but did not do so for reasons of his own.  It should rarely be found in a case where a workman was put in a situation where he had to work unsafely or risk the possible disapproval of his employer.

Hon Cheung JA :

The proceedings below

12.On 27 July 2004, Mr. Lai Wing Kee (‘the deceased’) was killed in an industrial accident.  The plaintiff who is the administratrix of the estate of the deceased sued the four defendants for damages arising from his death.  Yam J found against the defendants and held them responsible for damages in the following proportion ：

1st defendant	10%
2nd defendant	10%
3rd defendant	20%
4th defendant	60%

13.The Judge also found that the deceased was responsible for 20% contributory negligence.

14.The parties agreed that the damages were $2,680,000 which were reduced to $2,064,000 because of the plaintiff’s contributory negligence.

15.The 1^st, 3^rd and 4^th defendants appeal against the finding of liability and apportionment.  The 2^nd defendant which has been separately represented because of insurance interest, accepted the judgment.  The plaintiff cross-appeals on the issue of contributory negligence.

Facts

16.The defendants are members of a same group of companies.  They shared an office in Mong Kok.

17.The deceased was employed by the 2^nd defendant as an employee.  However, the 1^st defendant had for many years from April 1994 up to the day of the accident paid for his wages and contribution to the Mandatory Provident Fund (‘MPF’).  According to Mr. Wan (‘Wan’), an employee of the 4^th defendant, the deceased had been working at the 4^th defendant’s premises at 36-37 Cha Kwo Ling Road for about three months before the accident.  The 2^nd defendant’s premises were situated next door at 35 Cha Kwo Ling Road.  The 4^th defendant started to remove its operation to 35 Cha Kwo Ling about a month before the accident.  It was still in the process of removal when the accident occurred.  It should be noted that Mr. Lau, a director of the defendants who gave evidence on behalf of the defendants said that the 4^th defendant occupied 35 Cha Kwo Ling Road and the 2^nd defendant occupied 36-37 Cha Kwo Ling Road and it was the 2^nd defendant who was moving into 35 Cha Kwo Ling Road.  The Judge did not accept that the 2^nd defendant or the 2^nd defendant alone was occupying 36-37 Cha Kwo Ling Road.

18.The 2^nd defendant was the owner of a crane lorry (‘the lorry’), however, this lorry had been lent to and used by the 3^rd defendant.

19.On the day of the accident Mr. Wan asked the 3^rd defendant to arrange for the transportation of a defective forklift truck from the 4^th defendant’s premises to a workshop in Tsing Yi for repair.  Mr. Lam Siu Mo (‘Lam’), an employee of the 3^rd defendant, was asked by Mr. Tang, the head of the warehouse of the 3^rd defendant to drive the lorry to pick up the forklift truck.  Lam drove the lorry to the 4^th defendant’s premises and on arrival, he found that the forklift truck was already placed on the pavement outside the main entrance of the 4^th defendant’s premises.  The forklift truck weighed 4.11 tons.

20.Wan then directed the deceased and Lam to load the forklift truck to the lorry.

21.Lam and the deceased first removed the forklift truck a short distance away from the main entrance because there was an overhanging canopy above the main entrance which would obstruct the movement of the crane.  The deceased hooked two iron chains on the iron bars in front of the forklift truck and put the other end of the two chains to the hook of the crane.  The deceased sat inside the forklift truck and controlled its movement while Lam operated the crane to drag the forklift truck away from the main entrance.  After that the deceased removed the chains from the hook of the crane. 

The rigging of the forklift truck

22.In preparing for the loading of the forklift truck to the lorry, Lam and the deceased first removed the counterbalance of the forklift truck and placed it on the pavement.  The deceased then hung a chain (Chain B) on the hook of the crane and hooked the eyehooks of this chain to the two lashing eyes of the forklift truck (one on each side).

23.The deceased then used another chain (Chain A) to rig the mast of the forklift truck and the hook of the crane.  This chain only had one eyehook.  The eyehook was hooked back to the chain itself.  The last link of the chain at the other end which did not have an eyehook was also connected back to the chain itself by means of a shackle.

The accident

24.Lam then stood on the pavement and operated the control gear of the crane to lift the forklift truck.  When the forklift truck was raised two to three inches above the sideboard of the lorry, he moved the forklift truck sideways towards the lorry.  After the forklift truck was moved across the sideboard of the lorry by about one foot, the last link of Chain A suddenly broke, causing the forklift truck to fall on the pavement, crushing the deceased to death.

The position of the deceased

25.According to Lam when he raised the crane and tightened the chain, Wan and the deceased were holding the forklift truck at its rear in order to stabilize it.  When Lam began to lift up the forklift truck, Wan and the deceased moved away and went towards the end of the lorry.  After that he could no longer see them because his view was blocked by the forklift truck.

26.According to Wan he left the operation to Lam and the deceased and returned to his office.  When he came out again the forklift truck was lifted up about four feet from the ground.  The deceased was then on the pavement near the rear of the lorry and was facing the forklift truck.  Wan then went back to the office again.  After one minute, he heard a loud bang and went out to see what had happened.  By then the forklift truck was lying across the pavement.  The deceased was crushed underneath it.  The forklift truck was later lifted up in order to remove the deceased from underneath it.

27.Neither Wan nor Lam gave evidence at the trial.  However they had made statements to the police and the Labour Department.  Wan also gave a statement to a loss assessor.  These statements were admitted as evidence by agreement between the parties.

The finding

28.The Judge made the following findings :

1) The deceased obtained the two chains used in the rigging of the forklift truck from the lorry which was under the control of the 3^rd defendant.

2) The accident occurred because Chain A broke due to an inherent defect of the chain and due to the improper rigging of this chain. Counsel for the 1^st, 3^rd and 4^th defendants conceded at the trial that Chain A had broken.

3) Why Chain A broke was explained in the report of the Labour Department :

(1) The chains, including the eyehooks, were designed for lashing instead of lifting.

(2) The chains had not been tested and examined by a Registered Professional Engineer.

(3) The chains were not of the same length and size.

(4) The two ends of Chain A were attached back to the chain.

(5) Chain B was not of the appropriate size, i.e., too small.

(6) Defect already existed in at least a link in Chain A when it was being used.

(7) A master ring had not been used to connect the two separate chains to the hook of the crane.

4) The 1^st and 2^nd defendants were the general employers of the deceased. They failed to provide a safe system of work (including the provision of safe equipment) for the deceased. It was a non-delegatable duty.

5) The 3^rd defendant was liable for providing the defective chain (Chain A) that was used by the deceased in rigging the forklift truck.

6) The 4^th defendant was the employer for the time being (employer pro hac vice) of the deceased. It was the 4^th defendant (through Wan) who had ordered the deceased to perform the lifting operation. The 4^th defendant also failed to provide a safe system of work.

No employment relationship with the 1^st defendant?

29.Mr. Coleman S.C. and Ms. Queenie Ng who acted for the 1^st, 3^rd and 4^th defendants argued that the 2^nd defendant was the deceased’s employer and the 1^st defendant was not.

30.This point can be dealt with shortly.  All the defendants were members of the same group of companies.  They shared the same office.  While the employment contract was entered into between the 2^nd defendant and the deceased, the 1^st defendant had for many years paid for his wages and contributed to the MPF.  For nine consecutive years since 1994, the 1^st defendant had filed employer’s return to the Inland Revenue Department, naming itself as the employer of the deceased.  Further in the discovered monthly wages reports for four consecutive years from 2001, the 1^st defendant was stated to be the employer of the deceased.  These are extremely strong evidence to support a finding of employment relationship between the 1^st defendant and the deceased. The Court is not required to delve into the details of the business operation of the defendants when they themselves were not able to provide a satisfactory answer why the 1^st defendant would conduct its activities in this manner and named itself as the employer of the plaintiff.  In my view the Judge was clearly right to find that the 1^st defendant together with the 2^nd defendant were the general employers of the deceased.

Chains not provided by the 3^rd defendant?

31.The Judge held that the chains used by the deceased were probably obtained from the 3^rd defendant’s lorry which was under the 3^rd defendant’s control.

32.Mr. Coleman S.C. submitted that the chains and the lorry belonged to the 2^nd and not the 3^rd defendant.  Further there was no basis to say that the chains were provided to the deceased by the 3^rd defendant or that it would have had any knowledge of the defects in the chains.

33.I think the short answer is that the lorry had been under the control of the 3^rd defendant for a while and in the absence of evidence to the contrary, the chains on the lorry must have been intended to be used for the lifting operations of the crane.  As it turned out they were actually used in the operation which caused the death of the deceased.  On that basis, it does not lie in the mouth of the 3^rd defendant to say that it had no knowledge that the chains were defective.

Consideration of the expert evidence

34.Mr. Coleman S.C. had also argued that the Judge had failed to consider the report of Dr. Chung, the defendants’ expert in respect of the force and the manner of the overload.

35.I disagree.  The Judge’s rejection of Dr. Chung’s opinion was clearly supported by the evidence of Mr. Chan of the Labour Department and Dr. Lam, the plaintiff’s expert.  The inherent defect of Chain A was the presence of a notch (i.e. a cut or a worn part) on the chain.  This reduced the loading capacity of the chain.  Further Dr. Lam’s view was that there was further horizontal force being generated when the forklift truck was being moved sideways to the lorry. It was at that point that the chain broke.  In my view the Judge’s finding on how the accident happened cannot be faulted.

Negligence of the 3^rd defendant

36.In my view the 3^rd defendant must have been negligent in allowing the deceased to make use of the defective chains.

Liability of the 4^th defendant

37.Mr. Coleman S.C. did not challenge the law on employer for the time being : see a summary of the law by this Court (Tang JA (as he then was), Cheung JA and Barma J) in Jerry Chen v. Whirlpool (Hong Kong) Limited (CACV 325/2005), a decision affirmed by the Court of Final Appeal (2007) 10 HKCFAR 619.  The argument in this appeal was focused on the evidence of whether the 4^th defendant was the temporary employer.  It was said that the Judge had wrongly accepted the statement of Lam who referred to Wan as the supervisor when Wan had denied in the death inquest of the deceased that he was the supervisor.  Further the Judge was wrong to speculate that by reason of the relationship between the defendants, a benefit to the 3^rd defendant might well have been a motivation for the 4^th defendant to participate in the lifting operation.

38.In my view the stark fact of the case is that pursuant to internal arrangements of the defendants, the deceased was asked to work in the 4^th defendant’s premises and he had been so working for about three months when the accident occurred.  Whatever might be the position of Wan within the 4^th defendant, he received information that the 3^rd defendant would take delivery of the forklift truck and he had directed the deceased to assist in the loading operation.  In my view the Judge was clearly right when he found that the 4^th defendant was the employer for the time being of the deceased.

Negligence of the 4^th defendant

39.Mr. Coleman S.C. argued that the Judge was wrong to hold that the lack of supervision by the 4^th defendant of the operation was the root cause of the accident.  There was no evidence to suggest that supervision was necessary.  Further the deceased was experienced and was competent enough to carry out the operation independently.

40.The evidence showed that even according to Mr. Lau, he would have stopped the operation if he was aware of it.  He said that the forklift truck should be rigged by wire ropes and he explained how it should be properly rigged by the illustration of a diagram which was appended to the judgment below.

41.I would have thought that this evidence provided the strongest indication of the lack of supervision on the part of the 4^th defendant.  Wan who was employed by the 4^th defendant merely directed the deceased to assist Lam without telling them how the operation should be handled.  There was no evidence that the 4^th defendant had in place a system of work for its employees in lifting operations.  There was no evidence that wire ropes were available to its employees.  The fact that the deceased was an experienced worker does not absolve the 4^th defendant from showing that it had in place a safe system of work for its workers.  Dr. Lam was of the view that the deceased should not be the only worker present to ensure the stability of that the forklift truck when it was being lifted.  This highlighted the inadequacy of the operation and the need for supervision which was one of the recommendations made by the Labour Department in the Fatal Accident Report.  In my view, the negligence of the 4^th defendant was well established.

Threshold not met

42.The appeal by the 1^st, 3^rd and 4^th defendants is in respect of finding of facts by the Judge.  The principle in this regard is well established, namely, an appellate court would only disturb the finding of fact by a trial judge unless it is plainly wrong, for example, when it is not supported by evidence or contradicted by other material evidence : Ting Kwok Keung v. Tam Dick Yuen & Others [2002] 3 HKLRD 1.  The 1^st, 3^rd and 4^th defendants have not satisfied the high threshold in this appeal.

Apportionment

43.Mr. Coleman S.C. argued that the apportionment by the Judge was wrong.  Although apportionment was not specifically referred to in the Notice of Appeal of the 1^st, 3^rd and 4^th defendants, we would allow the point to be taken as Mr. Lee Tung-ming, counsel for the 2^nd defendant, was prepared and able to answer the point substantially.

44.The Judge held that the 4^th defendant was to assume 60% of the liability because it had all the necessary knowledge and a suitable person to provide supervision but had chosen not to do so.  This failure was the primary cause of the accident.  By contrast, the negligence of the 1^st and 2^nd defendants was relatively minimal as they had not been informed of the details of the operation and they could only suspect that the deceased was not properly supervised from their previous dealings with the 4^th defendant.

45.In my view while the 4^th defendant was to be responsible for the immediate supervision of the operation, one must not lose sight that the duty of care towards the deceased by the 1^st and 2^nd defendants as his general employers cannot be delegated : see Jerry Chen.  Even if an employee is seconded temporarily to a temporary employer, the general employer must assume the responsibility of providing a safe system of work for him.  In my view this responsibility should be reflected by a higher degree of liability on the part of the 1^st and 2^nd defendants.  In the circumstances of the cases, I would consider that a more appropriate apportionment should be 40% by the 4^th defendant on the one hand and 40% by the 1^st and 2^nd defendants on the other hand.  Between the 1^st and 2^nd defendants, each would be 20% to blame.

46.I do not agree with the argument that since the 2^nd defendant was the owner of the lorry and also of the defective chain which was used in the operation, it should assume a larger proportion of the blame.  It is clear from the evidence that the 3^rd defendant had control of the lorry and the chain at the time of the operation.  The 3^rd defendant’s apportioned liability shall remain at 20%.

Contributory Negligence

47.The plaintiff argued that the Judge was wrong to find the deceased 20% to blame for the accident.

48.The plaintiff pleaded that the deceased was working underneath the forklift truck when it fell on him.

49.The Judge found that the deceased was negligent because he was ‘going under the lifting load’.  He rejected the defendants’ contention that the deceased was also negligent in using improper chains and rigging the chains improperly.

50.There is a fundamental evidential problem concerning the deceased working underneath the forklift truck.  In my view there was no evidence adduced below to support this.  While the Fatal Accident Report stated that the deceased was standing underneath the forklift truck, neither Lam nor Wan stated that the deceased was standing underneath it. The position of the deceased as observed by Lam and Wan shortly before the accident did not support such an inference to be drawn but rather indicated the contrary.  The forklift truck did not fall and landed on its four wheels but had instead toppled sideways.  This further weakens any inference that the deceased was actually working underneath it when it fell.  More likely the deceased was standing next to the forklift truck guiding it to be loaded to the lorry when it crushed on him.  This can be supported from the report of Dr. Lam who said that after the forklift truck had been lifted up and while it was being moved sideways towards the lorry, force would be generated which would cause the forklift truck to move.  The position of the deceased suggested that he was standing in front of the forklift truck in order to balance or control its movement because of the force.

51.However, as the plaintiff had admitted and based its case on the deceased working underneath the forklift truck, the plaintiff did not seek to withdraw from the admission.  Hence the Court cannot substitute a new finding on the position of the deceased at the time when he was crushed.

52.However, even assuming that the deceased was working underneath the forklift truck, I do not find that he was negligent at all.  He did not go underneath it on a frolic of his own.  He was most likely to be there because he wished to stabilize it.  It is said that the deceased was an experienced operator of crane trucks and he should be aware of the risk involved in the operation.  However, the reality is that the 4^th defendant had left the task to Lam and the deceased who had to make do with limited manpower and with whatever available equipment they had.  The starting point of the analysis is that the defendants had not provided a safe system of work for the deceased.  This Court (Tang VP, Yam and Stone JJ) in Leung Po Chun v. Yat Lee Booth-Construction Co., Limited (CACV 399/2007), applied the following classic statement from General Cleaning Contractors Ld v. Christmas [1953] AC 180 at 187 which is most apposite to this case.

‘ … You cannot blame the man for not taking every precaution which prudence would suggest. It is only too easy to be wise after the event. He was doing the work in the way which the employers expected him to do it and, if they had taken proper safeguards, the accident would not have happened.’

53.The Judge further was clearly right when he rejected the argument that the deceased was also negligent when he used improper chains and improper method in rigging the forklift truck.  The Judge clearly had by this finding rejected the suggestion that some proper chains or proper equipment were in fact available to be used in the operation.

54.Accordingly I will hold that the deceased was not contributorily negligent.

Conclusion

55.The 4^th defendant’s appeal is allowed in respect of the apportionment to the extent as indicated.

56.The plaintiff’s cross appeal is allowed and the Judge’s finding of 20% contributory negligence on the part of the plaintiff is set aside.  Judgment for $2,680,000 shall be entered against the defendants.

Costs

57.The parties are required to submit written submission on costs within 14 days.

Mr. Andy Hung, instructed by Messrs Pansy Leung Tang & Chua, assigned by the Director of Legal Aid, for the Plaintiff

Mr. Russell Coleman SC and Ms Queenie W S Ng, instructed by Messrs Gilbert Tang & Co., for the 1^st, 3^rd & 4^th Defendants

Mr. Lee Tung-ming, instructed by Messrs. Deacons, for the 2^nd Defendant