Ho Kwok Kei v AS Watson & Co, Ltd

TORT

Ho Kwok Kei v AS Watson & Co, Ltd
[2019] 3 HKLRD 592, [2019] HKCFI 1618, [2019] HKEC 2039
Court of First Instance
Personal Injuries Action No 325 of 2016
Godfrey Lam J
23–26 October, 5 November 2018, 27 June 2019

Tort — vicarious liability — scope — whether to be extended to acts of party’s independent contractor or independent contractor’s employees — whether English approach in Cox v Ministry of Justice to be applied

Tort — negligence — employer’s liability — liability to employees — whether employer of injured plaintiff vicariously liable for negligence of independent contractor’s employee which caused injury   

P was employed as a store manager of a supermarket operated by D1 (the Store). A related company (ASWGL) engaged contractors, including D3, to deliver goods from D1’s warehouses to its supermarkets under a Service Agreement. D3 used both its own and ASWGL’s vehicles. Pursuant to the Service Agreement, each party was an independent contractor; transport workers, including X, were D3’s direct employees; D3 was responsible for its employees’ remuneration and insurance cover and determined their working hours; and D3 decided which vehicle and which driver would be used for each delivery. On the day concerned, X drove an ASWGL lorry (the Lorry) to the Store with pallets of goods which P helped to unload. While standing on the hydraulic tailgate platform as it was being lowered, X pressed the wrong buttons causing the tailgate to tilt downwards and a pallet to injure P’s toes. P brought an action for personal injuries arguing that inter alia the accident was caused by X’s negligence for which, on the principles in the English case of Cox v Ministry of Justice, D1 was vicariously liable because the deliveries by D3 using the Lorry were an integral part of D1’s business and X’s negligence was a risk created by D1 assigning such activities to D3. D1 denied liability, contending that D3 was an independent business operating for its own benefit.

Held, dismissing the claim as employees’ compensation paid exceeded the total award of damages and interest, that:

  1. The new approach in Cox v Ministry of Justice had not yet been applied in Hong Kong to found vicariously liability for the acts of a party’s independent contractor or the independent contractor’s employees. To apply that approach in a case such as the present to find D1 vicariously liable for the tort committed by X would be a major change in the law. It would render the distinction between an employee and an independent contractor far less significant, if not altogether obsolete. The Court was addressed on whether it was open to the Court of First Instance to change the law in the way suggested. Nothing was known about the implications for the insurance system, particularly the issue of risk allocation and who would be best placed to insure against the relevant risks (Luen Hing Fat Coating & Fishing Factory Ltd v Waan Chuen Ming (2011) 14 HKCFAR 14, Li Ming Tak v Hong Kong Airport Services Ltd [2015] 4 HKLRD 749 applied; Tsoi Wing Yuk v Perfect Marble Co Ltd (HCPI 779/2012, [2016] HKEC 818), Talat Zahid v Cheung Fat Metal Trading Co Ltd (HCPI 399/2012, [2017] HKEC 1297), Chan Cho Tak v Ng Shing Leung (HCPI 491/2015, [2018] HKEC 1477), Barclays Bank plc v Various Claimants [2018] EWCA Civ 1670 considered; Cox v Ministry of Justice [2016] AC 660  not followed). (See paras.63, 66–68, 70.)
  2. Even on the Cox approach, on the facts of this case, it was seriously arguable that D1 was not vicariously liable for X’s tort. X was employed by D3, a separate company and business with its own management, its own fleet of over 20 vehicles and its own staff, which had other transport customers and orders. X and other drivers took instructions from D3. It was D3, not D1, which exercised control over X. In any event, this issue was academic given that no damages were payable. As such, this was plainly not an appropriate case in which to consider expanding the law of vicarious liability. (See para.69, 71–72.)

Action

This was a personal injuries action brought by the plaintiff against the first and third defendants. The facts are set out in the judgment.

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