United Ford Development Ltd. t/a King Ford Mahjong Club v. Fung Yin Yee, Shirley and Others
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CACV000149/1992 IN THE COURT OF APPEAL 1992, No. 149 ___________________
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___________________ Coram: Fuad, V.-P., Nazareth, J.A. and Mortimer, J. Dates of hearing: 4 and 5 February 1993 Date of judgment: 5 February 1993 Reasons handed down: 12 February 1993 ________________ J U D G M E N T ________________ Fuad, V.-P.: 1. These four appeals (which, by consent, we heard together) are brought by United Ford Development Ltd., trading as King Ford Mahjong Club ("the Employer") against the decision of Judge Downey dated 27th August 1992 whereby he held that the Employer was liable to pay compensation for the benefit of the dependants of four deceased men by virtue of the rights accorded by the Employees' Compensation Ordinance, Cap. 282 ("the Ordinance"). 2. At the conclusion of the hearing on 5th February 1993 we dismissed the appeals and now give our reasons. 3. The Employer has, for the past three years, owned and operated a mahjong club at No.19 Gillies Avenue, Hung Hom, occupying the ground, the 1st and the 2nd floors of a commercial/residential building. On the ground floor the club has a restaurant with a roast meat "take-away" section. This closed at about 9 p.m. each evening. There were 10 private rooms on the 1st floor and 16 on the 2nd floor, as well as reception areas and kitchens. These rooms could be hired for the playing of mahjong and the club provided this service on a 24 hour basis. There were about 33 staff employed at the club, working on a shift system - kitchen staff; supervisory managers, assistant managers and other officers; cashiers; waiters and waitresses. 4. In the early hours of the morning of 11th September 1990, two of the 10 private rooms on the 1st floor were in use, as were all but two of the rooms on the 2nd floor. These floors could be reached by a separate staircase from the street. The restaurant was about to close. There were about 70 people in the club - customers and staff. 5. At about 2.55 a.m., three men rushed into the reception area on the 1st floor. They were armed with knives. They subdued the cashier, Mr. Wong Kit Lung, and the night shift supervisor, Mr. Li Wing Cheung, who were on duty at the time. They poured petrol on to the carpet and set it alight. The fire spread quickly. Everyone managed to escape except six men who were found unconscious on the 1st floor by firemen. All six men were certified dead on arrival at the hospital. They had each died from the inhalation of smoke. 6. These appeals concern four of the six men who died so tragically - all four were employees of the club:
7. The claim for compensation in each case was made pursuant to section 12(1) of the Ordinance and although the court has yet to determine the amounts due to the dependants, each claim was for $424,000 (see section 6(1) of the Ordinance). For a claim to succeed the court had to be satisfied that the accident causing the death arose out of and in the course of the deceased's employment (section 5(1) of the Ordinance). The only other material provision of section 5 is subsection (6) which provides that "... an accident arising in the course of an employee's employment shall be deemed, in the absence of evidence to the contrary, also to have arisen out of that employment." 8. The Employer resisted each claim on the basis, in the judge's words, that all four men were off-duty at the material time; they were playing mahjong for their own amusement and the accidents did not arise out of their employment because they were the result of an intentional criminal act committed by strangers, and the event was neither incidental to their employment nor a special risk of working in the club. 9. The judge expressed the view that the question whether an accident had occurred in the course of an employee's employment was a mixed question of fact and law. 10. The judge referred to a number of authorities. Early in his judgment he observed that he had found many of them of limited or of no assistance as they were, in his words, "heavily influenced by consideration of the second question of whether the injury arose out of the employment". Moreover, he remarked, many of them had been decided before the introduction of a presumption on the lines of that contained in section 5(6) of our Ordinance. He felt that the words in the enactment should be broadly construed and indicated that he would adopt, as his guiding principle, this passage from the judgment of Roskill L.J. in R. v. National Insurance Commissioner, ex parte Michael [1977] 1 WLR 109, at p.118:
11. The duty of the court, in the judge's view, was to consider the time when the accident occurred, the place where it occurred, and what the employee was doing at the time of the accident. 12. The judge heard evidence about Mr. Liu Tai Cheong who did not himself testify. He is the major shareholder of the Employer and was regarded as "the boss" by the employees of the club. He was not there on the night of the tragedy. In respect of each of the four deceased employees, he was the signatory (as "Partner/Manager") on the prescribed form (Form 2), dated 19th September 1990, reporting the death of the employee to the Commissioner for Labour as required by section 15 of the Ordinance. On each form, in the box which asks the question "Did the accident occur in the course of work?", the answer given is "Yes". 13. The only non-employee to die in the fire was Mr. Liu Kin Wah who was Mr. Liu Tai Cheong's uncle and a regular customer of the club. He used the club as often as four or five nights a week, playing mahjong until the early hours of the morning. 14. The claimants called two witnesses: Mr. Chiu Tat Ming, who was the manager of the club at the material time, and Mr. Ng Tok Mo, who worked as a cook there. The Employer called no evidence. 15. Counsel representing the Employer at the hearing before the judge sought to cast doubt upon Mr. Chiu's credibility and bona fides by suggesting, as the judge put it, that the witness had given evidence favourable to the claimants because of understandable sympathy, and a vague belief that insurance companies were rich and should pay up. The judge acknowledged that Mr. Chiu's evidence was not free from defects (it included various apparent or actual contradictions), but he totally rejected these suggestions. He was satisfied that the apparent contradictions in Mr. Chiu's evidence were attributable to confusion, stemming from the fact that the witness did not always appreciate some of the questions or matters put to him. 16. The judge also said that he had no hesitation in accepting Mr. Ng's evidence. His evidence had been uncontradicted and he had not been shaken in cross-examination. 17. The judge concluded that Mr. Tai Kwok Ching (the 2nd deceased) was in overall charge and control of the normal activities of the club at the material time. Before leaving the club at about 11 p.m. he had been asked or ordered by Mr. Chiu Tat Ming to remain on duty until 4 a.m. and not to leave while the club was still busy. His duties included supervising waitresses and other staff and generally socialising with customers, especially privileged, regular ones. These duties might include playing games of cards or mahjong with customers, provided that this did not go on for long periods or otherwise interfere with his work as manager of the club once Mr. Chiu Tat Ming had left the premises and provided this was requested or suggested by a regular customer. 18. The judge found that Mr. Tai could not get involved in a long game lasting two or more hours, or take part in one which would prevent him from attending immediately to any problem concerning the normal management of the club. His discretion to socialise with customers was subject to the amount of business activity at the relevant time. While chatting casually with a customer was part of his work, if some problem was brought to his notice, he would be expected to give priority to dealing with it. Whether he complied with a request by a customer to engage in such activity was a matter within his discretion, after Mr. Chiu had left. He did not need express prior permission from Mr. Chiu. 19. Mr. Tai had started to play cards with the cook, Mr. Ng Tok Mo, and two regular customers. He had accepted an invitation to join in the game. He was still in his captain's uniform and the door of the room in which they were playing had been kept open so that Mr. Tai could keep an eye on what was going on and be ready to deal with any problem which arose. Business had been sufficiently slack on the 1st floor to allow Mr. Tai to exercise his discretion to socialise with regular customers. He could have withdrawn at any moment to attend to any matter which needed his attention. His playing of cards in those circumstances was reasonably incidental to his work. 20. The judge held that Mr. Tai's death was an accident which occurred in the course of his employment by the Employer. This finding in relation to Mr. Tai is not challenged in these appeals. 21. In respect of the other men whose dependants made claims under the Ordinance, the judge found that Mr. Lam Wai Lap (1st deceased), Mr. Yim Sze Tung (3rd deceased) and Mr. Leung Ping Wah (4th deceased) had been playing mahjong with the regular customer Mr. Liu Kin Wah. The evidence accepted by the judge was that Mr. Liu had been the last customer of the restaurant when it was about to close. The friends he was waiting for to join him in a game of mahjong did not turn up. When he mentioned this to Mr. Chiu Tat Ming, Mr. Chiu suggested that Messrs. Lam, Yim and Leung should play with him. They had almost finished their work in the restaurant. Had Mr. Liu finished his meal they would have rolled down the shutters and then gone off duty. Mr. Yim and Mr. Leung had already changed out of their uniforms into their own clothes. Mr. Lam did not wear uniform on duty. They had been playing possibly for as long as five or six hours before the premises were set on fire. 22. In the judge's view, had the three deceased merely been promoting the interests of the club by playing with an important and regular customer, that would not have been sufficient to enlarge the scope of their employment, because playing mahjong could not be said to be reasonably incidental to their work as roast meat cooks or cashier. It had also to be shown that they had been instructed or urged to go upstairs and play with Mr. Liu Kin Wah after they finished their work in the restaurant as a favour of the club. 23. The judge said that he felt that it was of some significance that Mr. Liu's request for players had been addressed not to the three deceased but to Mr. Chiu Tat Ming who had then "suggested" to the deceased that they should play with Mr. Liu. The judge said that on the very limited evidence before him, Mr. Chiu's suggestion seemed to have fallen short of being an order or instruction. However, it was not uncommon for employees to be asked or persuaded to do things for their employers after normal working hours, or to do things which were completely outside their normal work. Their compliance with such requests might be due to fear of jeopardising future employment prospects by a refusal, or simply an indication of their desire to please or be cooperative, especially if the extra activity at the same time gave them pleasure. In the judge's view, the fact that Mr. Chiu had merely "suggested" that they should play with Mr. Liu was not important. Nor was the fact that an employee might be doing something for his own pleasure or interest at the time of the accident the major consideration, because labour was often intermittent. The real question, he felt, was whether the employee's activity at the material time could fairly and reasonably be regarded as part of the employer - employee relationship, or was wholly extraneous thereto. 24. The judge went on to say that in his view the significance of the fact that Mr. Liu had addressed his request to Mr. Chiu, and not directly to the three deceased, was that it suggested that Mr. Liu had been looking to Mr. Chiu, as the person then in overall charge of the club, to render him a service which Mr. Liu expected to get from the club. Had he merely wanted to play with the three deceased because they were friends or acquaintances, there would have been no need to consult their immediate superior, Mr. Chiu. 25. The judge then said that the evidence indicated that on that night the club had been short of manpower. It was, in his opinion, likely that the three deceased were asked to remain after work because there were insufficient employees on the 1st and 2nd floors to cope with customers' requests for partners to play cards or mahjong. 26. The judge went on to observe that if that conclusion involved a degree of speculation on his part, he considered that all doubt had been removed by evidence which suggested that the Employer regarded the three deceased as still acting within the course of their employment, although they had finished their normal work and were playing mahjong in a place where they did not carry out their normal work. This evidence was the answer "Yes" given on each Form 2 to the question: "Did the accident occur in the course of work?" These, in the judge's view, constituted relevant admissions of a material fact made by the Employer. After reviewing opposing counsel's submissions on this matter, the judge said this:
27. Mr. Warren Chan, who did not appear in the court below, submitted on behalf of the Employer that while the judge had correctly directed himself as to the proper approach he should adopt, he had erred in admitting the claims of the dependants of Mr. Lam Wai Lap (1st deceased), Mr. Yim Sze Tung (3rd deceased) and Mr. Leung Ping Wah (4th deceased) because:
28. Mr. Chan also contended that the evidence did not suggest that Mr. Liu Kin Wah had asked Mr. Chiu to find people to play mahjong with him - they were merely having a conversation. It was argued that the judge should have regarded the fact that Mr. Chiu had merely made a suggestion to the three employees of much greater significance because he had neither instructed them, nor urged them, to play; it was clear that Mr. Chiu did not consider playing mahjong with Mr. Liu as part of their duties; the employees were fully entitled to refuse to join in the game; they had not responded verbally to Mr. Chiu's suggestion and Mr. Liu was well-known to all three employees. 29. Mr. Chan also submitted that the judge had been guilty of speculation upon a number of matters to the disadvantage of the Employer. 30. As to the judge's treatment of the contents of the Form 2 notices, Mr. Chan's submission was that the judge had attached undue weight to them and had erred in holding that they added cogent support to the other evidence, because the person who had completed the forms (Mr. Liu Tai Cheung) had not been on the premises when the fire broke out, so that he could have had personal knowledge of the events; there was no evidence to show what steps, if any, he had taken to find out what had happened; there was no evidence to indicate the basis of the belief expressed by Mr. Liu on the form. 31. The judge recognised that this was an unusual case and dealt with the evidence and the issues before him with great care. His evaluation of the full impact of the evidence of Mr. Chiu, whom he heard and saw, given that he did not misdirect himself on the facts or the law, is entitled to great weight and respect. The dependants of the deceased men assumed a heavy burden when they sought to establish that their relatives had been in the course of their employment when they were playing mahjong long after their normal duties would have ended but, despite Mr. Chan's cogent submissions, I was not persuaded that this court was entitled on the evidence and the law, to disturb the judge's conclusions upon the question. It is not enough that another tribunal, properly directing itself, might possibly have reached a different result. 32. I do not think that the judge was speculating on any material issue. It seems to me that he was using his long experience, and his common sense, regarding the realities of the employment scene in Hong Kong and he did not stray in the way that the Employer has suggested. 33. In my judgment, the judge was fully entitled to give what weight he did to the admissions contained in the Forms 2 and that his approach to them cannot be faulted. 34. The Employer failed to establish that the judge erred in finding that the deaths of Mr. Lam Wai Lap (1st deceased), Mr. Yim Sze Tung (3rd deceased) and Mr. Leung Ping Wah (4th deceased) had occurred in the course of their employment. 35. When the judge turned to consider the question whether each accident arose out of the employment, he observed that it was generally accepted that the question was one of causation. In his view, the modern tendency was to adopt a fairly broad approach, and to find in favour of the employee if it could reasonably be concluded that the injury was connected with the employment. It seemed to him that the first question was whether there was evidence "fit to be left to the jury" to show that the accident did not arise out of the employment so as to prevent the operation of the deeming provisions of section 5(6) of the Ordinance. 36. The judge expressed the view that in this case all the evidence led to the inference that the arsonists had intended an attack upon the club's premises or the business and not an assault upon persons, whether staff or customers. The normal means of escape from the premises had not been blocked. Such force as had been used against Mr. Li Wing Cheung and Mr. Wong Kit Lung, appeared to have been used solely to prevent them from interfering with the intruders' clear aim of setting fire to the 1st floor. He felt that suggestions that the arson was "triad-related" were largely speculation. In any event, there was no evidence to show that the arsonists were singling out any individual or group as victims of their attack. In his judgment, there was no "evidence to the contrary" to prevent the deeming effect of section 5(6) of the Ordinance. He therefore found that the deaths of the four deceased had resulted from accidents arising out of and in the course of their employment by the Employer. 37. Mr. Chan has submitted that in view of the decision of the English Court of Appeal in R. v. National Insurance (Industrial Injuries) Commissioner, ex parte Richardson [1958] 1 WLR 851 upon the true construction of section 7(4) of the National Insurance (Industrial Injuries) Act 1946 (since repealed), a provision almost identical to section 5(6) of the Ordinance we are applying, the judge had been wrong to pray in aid the statutory presumption. In the light of the conclusions I have reached regarding the alternative ground upon which the judge held that the deaths of these unfortunate men arose out of their employment, I do not consider it to be necessary to decide whether or not the presumption was legitimately relied upon. All I desire to say here (and Mr. Chan has not sought to argue otherwise) is that I respectfully and entirely agree with the inference drawn by the judge that the arson attack was aimed at the establishment. Such an inference was, on the facts, irresistible. 38. The judge went on to indicate that if he were wrong in his evaluation of the evidence regarding the possible reasons or motives for the arson, he was nevertheless satisfied on the balance of probabilities that the deaths of all four deceased arose out of their employment. He added:
39. The judge referred to a number of authorities on this point and particularly relied upon a passage from the judgment of Russell L.J. in Lawrence v. George Mathews (1924) Ltd. [1929] 1 KB 1 at p.19:
40. The judge then addressed the submission of counsel for the Employer (repeated and amplified by Mr. Chan before us) that Russell L.J.'s fourth proposition in Lawrence v. George Mathews had been correctly explained by Lawrence L.J. in Holden v. Premier Waterproof and Rubber Co. Ltd. (1931) 144 LT 519 (CA) where he said at p.523:
41. The judge observed that this gloss on Russell L.J.'s fourth proposition seemed to be inconsistent with the views expressed by the House of Lords in Thom or Simpson v. Sinclair [1917], AC 127, and had not been adopted in the later case of Powell v. Great Western Railway Co. [1940] 1 All ER 87. In his view, what Slesser L.J. (who had been a member of the court in Holden's case) had said at p.89 "covered the situation in the present case":
In the judge's view, the club's premises became a dangerous spot by the setting of the fire on the 1st floor. The deaths of the four men had arisen out of their employment. 42. Subjecting the facts to Lawrence L.J.'s observations in Holden's case, Mr. Chan made the following submissions:
43. Mr. Chan contended that in the circumstances, the evidence had not established (a) that the accidents resulted from a risk necessarily incident to the performance of the men's duties, or that the risk was an abnormal one for the deceased or (b) that the place where the accidents occurred was a dangerous spot so as to bring them within Russell L.J.'s fourth proposition, properly understood. 44. During the hearing of the appeal, we were referred to the decision of the Privy Council in a case from the Court of Appeal of New Zealand: Brooker v. Thomas Borthwick and Sons (Australasia) Ltd. [1933] AC 669. This case was not cited to the judge. As the result of a severe earthquake some buildings in Nelson collapsed. Debris fell on three men who were 'workers" under workers' compensation legislation. Two of the men had been working on the premises where they were employed, a third was in a public street carrying out his duties. The fourth worker lost his balance as he worked and fell down a deep incline on the premises where he was employed. For liability under the relevant statute to attach to the employers, it had to be shown that the workman had suffered "injury by accident arising out of and in the course of his employment". 45. Lord Atkin, who gave the opinion of the Board discussed Thom or Simpson v. Sinclair and applied it. I quote extensively from pages 673-675 of the report:
46. At p.677, Lord Atkin said this in relation to Russell L.J.'s judgment in Lawrence v. George Mathews:
He went on to add:
Later, Lord Atkin observed at p.679:
47. It seems to me that the views expressed by Lord Atkin, following and applying Thom or Simpson v. Sinclair are inconsistent with the approach of the Court of Appeal in Holden's case. Mr. Chan conceded so much. We are effectively bound by the decision of the Privy Council in Brooker's case (see per Lord Diplock in de Lasala v. de Lasala [1980] AC 546 at p.558.) Although Holden's case was not cited in Brooker's case, so far as this court is concerned, we must take it that on this issue Holden's case has been overruled. 48. The judge's conclusions in this difficult area of the law were shown to be well founded by the decision of the Privy Council of which he was unaware. 49. I was not persuaded that, on the true construction of the Ordinance, the evidence and authority precluded him from holding that the four men had met their deaths as a result of an "accident" which arose out of (and, as I have already indicated, in the course of) their employment. Nazareth, J.A.: 50. I agree. Mortimer, J.: 51. I also agree.
Representation: Mr. Warren Chan (Johnson, Stokes & Master) for the Appellant Mr. Michael Ozorio (Hastings & Co.) for the Respondents |
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