In Hong Kong, when an individual is injured due to an accident or other events, they may receive so-called "compassionate payments" from their employer or the party in fault. Common examples include payments provided by an employer after a work-related injury, payments offered by a construction developer following a site accident, payments given by a shopping mall to an injured person after a slip, and payments from a restaurant involved in a food poisoning incident. However, individuals should exercise caution before accepting such payments. This article will explore the complexities of compassionate payments within Hong Kong's legal framework and explain why these payments may affect future legal claims.
What Are Compassionate Payments?
Compassionate payments typically refer to funds voluntarily provided by an employer or the party in fault out of sympathy or a sense of responsibility towards the victim. These payments aim to offer immediate financial support to help the victim cope with the economic pressures caused by their injury. However, the nature of these payments often vary by case and the acceptance of these payments may carry legal implications.
Legal Significance of Compassionate Payments
In Hong Kong, accepting compassionate payments may impact the victim's future legal rights to claim compensation. The main risks include:
(Full and Final) Settlement: In some cases, the party making the compassionate payment may require the victim to sign a settlement agreement, which is seen as a full and final resolution of all claims or part of the (potential) claims. This means that after signing, the victim may not be able to make any further claims related to the same incident.
Offsetting Future Compensation: Under Hong Kong's personal injury compensation laws, courts will consider all funds received by the victim, including compassionate payments, when determining compensation. This could mean that if the court finds that the compassionate payment has partially compensated the victim's losses, the final compensation amount may be reduced accordingly.
Offsetting Future Compensation
Of course, regarding the offset of future compensation, if the employer or the party in fault is willing to agree with the victim that the compassionate payment will not offset future compensation, the court is likely to regard the compassionate payment as separate from the compensation amount.
Donations from Charities/Citizens
It is noteworthy that donations from charities or citizens are generally not subject to offset under Hong Kong common law. These donations are typically intended to support the victim unconditionally and usually do not affect the victim's rights to claim against other parties in fault. However, even with donations, victims should seek legal advice before acceptance to understand all potential legal consequences.
Actual Losses and Assistance from Non-At-Fault Third Parties
Compensation for personal injuries in Hong Kong is based on actual losses. This means the court will assess all economic and non-economic losses suffered by the victim due to the injury, including medical expenses, lost income, pain, suffering and loss of amenities, and potential future medical costs.
In theory, if a victim has reduced their losses due to unpaid assistance from third parties (such as family or friends), the compensation amount should be adjusted accordingly. However, recent legal cases tend to support the view that the victim's compensation should not be reduced because of acceptance of benevolent payments from third parties, ensuring that the party in fault does not benefit from the goodwill of others. This is because courts generally view third-party assistance as support for the victim rather than a means to reduce the amount the party in fault must pay for the victim’s actual losses.
However, if the third party is not really a third party, for example if the third party is a major shareholder of the company that is in fault, the situation may become different. Therefore, victims should seek professional legal advice to fully understand the potential legal consequences of accepting assistance from third parties.
Conclusion and Recommendations
When faced with compassionate payments from an employer or the party in fault, victims should proceed with caution. Before accepting any compassionate payment, best practices include:
Consulting with a legal professional to fully understand the terms of the compassionate payment and its potential legal consequences.
Evaluating the relationship between the compassionate payment and any future legal claims.
Considering whether to accept the payment, especially if it involves settlement terms or liability waivers.
Through careful evaluation and professional legal counsel, victims can ensure they protect their rights while effectively utilizing available resources to address the challenges arising from their injuries. In personal injury cases, every step of consideration is crucial, especially when financial compensation is involved; all potential legal pitfalls must be carefully noted.