China Ping an Insurance (Hong Kong) Co Ltd v. Chong Tin Po

DCCJ 3525/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO.3525 OF 2010

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Coram: Master B. Mak in Court

Date of Hearing: 1^st June 2011 and 20^th July 2011

Date of Handing down of Judgment: 29^th July 2011

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ASSESSMENT OF DAMAGES

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Background

1.This is an assessment of damages of the Plaintiff’s claim against the Defendant.

2.The Defendant was present at the hearing on 1^st June 2011 and 20^th July 2011 during which Cantonese was used.  As all the documents in this action are in English, this decision is written in English.  A Chinese translation will be supplied to the Defendant at request.

Interlocutory Judgment

3.Interlocutory Judgment was entered against the Defendant on 18^th November 2010 with damages to be assessed.

The Plaintiff’s case

4.The Defendant was the owner of a private car bearing registration number FN 4768 (“the car”).

5.The Plaintiff is an insurance company and the insurer of the car.

6.On 4^th March 2008 while the Defendant was driving the car along   the southbound carriageway of Kowloon Park Drive, Hong Kong, the Defendant failed to stop the car in time and rammed into the rear of a Motorcycle bearing registration number MG 2547 driven by one Mr. WONG Yee-kwan (“Mr. Wong”). 

7.As a result, Mr. Wong was injured.

8.Mr. Wong commenced an action under the Employees’ Compensation Ordinance against his employer, Pizza Hut Hong Kong Management Limited (“the Employer”), under DCEC No.798 of 2009 (“the EC action”).

9.Due to the Plaintiff's statutory liability to the injured person under Section 10 of the Motor Vehicles Insurance (Third Party Risks) Ordinance, the Plaintiff took over of the EC action from the Employer.

10.Eventually, the Plaintiff reimbursed the Employer a sum of $129,908.29 being compensation paid to Mr. Wong plus his legal costs which were agreed at $41,000.

11.The Plaintiff also paid $50,000 on the Employer’s legal costs and $45,406 on its own legal costs in the EC action.

12.The Defendant had failed to inform the Plaintiff in writing of the accident.  By reason thereof, he had committed a breach of the General Conditions (18) (b) of the insurance policy.

13.The Defendant was convicted for the offence of driving a motor vehicle with alcohol concentration in breath exceeding the prescribed limit.  By reason thereof, he had committed a breach of the Intoxicating Liquor Exclusion Clause of the insurance policy. 

14.The Plaintiff therefore disclaimed liability to indemnify the  Defendant.

15.The Plaintiff claimed against the Defendant under clause 14 of the insurance policy for the amounts paid due to the EC action.

Clause 14 of the insurance policy

16.Clause 14 of the insurance policy provides that :-

“If the Company is obliged by the laws of any country within the Geographical Area or by virtue of any agreement between the Company and the Motor Insurers’ Bureau of Hong Kong to pay an amount for which the Company would not otherwise be liable under this Policy the insured and any other person on whose account the payment is made shall forthwith repay such amount to the Company.”

The relevant legal provisions

17.Section 10 of the Motor Vehicles Insurance (Third Party Risks) Ordinance provides that :-

“(1) If, after a certificate of insurance has been issued under section 6(3) in favour of the person by whom a policy has been effected, judgment in respect of any such liability as is required to be covered by a policy under section 6(1)(b) (being a liability covered by the terms of the policy) is obtained against any person insured by the policy, then, notwithstanding that the insurer may be entitled to avoid or cancel, or may have avoided or cancelled, the policy, the insurer shall, subject to the provisions of this section, pay to the persons entitled to the benefit of the judgment any sum payable thereunder in respect of the liability, including any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any law relating to interest on judgments.”

18.Section 25(1)(b) of the Employees’ Compensation Ordinance provides that :-

“(1) Where the injury in respect of which compensation is payable was caused in circumstances creating a legal liability in some person other than the employer (in this section referred to as the third party) to pay damages to the employee in respect thereof-

…

(b) the employer by whom compensation is payable…shall have a right of action against the third party for the recovery of any sum which he is obliged to pay as a result of the accident, whether by way of compensation or indemnity, or by virtue of any agreement made with the employee prior to the accident, and may exercise such right either by joining in an action begun by the employee against the third party or by instituting separate proceedings:

Provided that the amount recoverable under this paragraph shall not exceed the amount of damages, if any, which in the opinion of the court would have been awarded to the employee but for the provisions of this Ordinance.”

19.Section 3 of the Civil Liability (Contribution) Ordinance provides that :-

“(1) Subject to the following provisions of this section, any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly with him or otherwise).

…

(4)        A person who has made or agreed to make any payment in bona fide settlement or compromise of any claim made against him in respect of any damage (including a payment into court which has been accepted) shall be entitled to recover contribution in accordance with this section without regard to whether or not he himself is or ever was liable in respect of the damage, provided, however, that he would have been liable assuming that the factual basis of the claim against him could be established.”

20.In Wah Kwong Construction Material v Wong Man Yip, CACV 54/1994, the Court of Appeal held that the words “any sum” under Section 25(1)(b) of the Employees’ Compensation Ordinance are not limited and that a claimant can recover not only the compensation or indemnity but also costs which he is obliged to pay as a result of the accident.

21.Applying the same principle, Her Honour Judge H.C. Wong in Hong Kong Red Cross v The Hong Kong Federation of Youth Groups, DCCJ 2233/2007 held that a claim based on Section 25(1)(b) of the Employees’ Compensation Ordinance and Section 3 of the Civil Liability (Contribution) Ordinance also includes costs paid to the claimant and his own legal costs in defending the claim.

Findings

22.I am satisfied that the above legal principles are applicable to the present case. 

23.I find that the Plaintiff is entitled to recover from the Defendant the compensation paid to Mr. Wong in the EC action in the sum of $129,908.29.

24.I find that the Plaintiff is also entitled to recover from the Defendant the legal costs paid to Mr. Wong’s solicitors in the sum of $41,000; the sum of $50,000 paid to the Employer’s solicitors and the Plaintiff’s own legal costs in the sum of $45,406 in the EC action.

Summary

25.In summary, I find that the Plaintiff is entitled to recover from the Defendant the following sums :-

Interest

26.The Plaintiff shall be entitled to interest on the said sum at judgment rate from the date of Writ (i.e. 14^th October, 2010) to the date of the Interlocutory Judgment and thereafter at judgment rate to the date of payment.

Costs

27.I order that the Defendant doth pay the Plaintiff costs of this action, by summary assessment, in the sum of $30,000.00, to be paid forthwith.

Mr. Ting Lok Shan of Messrs. Li, Kwok & Law for the Plaintiff

The Defendant, unrepresented, appearing in person