For discussion

on 31January 1997


Subhead 284 Compensation

Members are invited -

(a) to approve the payment of $28 million as settlement out-of-court to the families of Vietnamese migrants who died in the Shek Kong Incident of 3 to 4 February 1992 and to Vietnamese migrants who sustained injuries in the same incident; and

(b) to approve a supplementary provision of $28 million under Head 106 Miscellaneous Services Subhead 284 Compensation to meet the increase in expenditure arising from (a) above.


Arising from the Shek Kong Incident of 3 to 4 February 1992, 126 Vietnamese migrants (VMs) are pursuing claims for compensation against the Hong Kong Government. We would need to incur huge costs if the matter goes to trial and yet the outcome of the legal proceedings is by no means certain.


2. The Secretary for Security (S for S), on the advice of the Attorney General (AG), proposes to offer a payment of $28 million as settlement out-of-court in respect of the claims by 118 VMs instead of proceeding to trial.


3. On 3 to 4 February 1992, inside the Shek Kong Detention Centre, a group of Vietnamese migrants (Southerners) attacked another group of Vietnamese migrants (Northerners) accommodated nearby and set fire to a hut housing the latter. Twenty-four VMs (including 12 children) died and 114 others suffered non-fatal injuries of varying degrees of severity.

4. The Director of Legal Aid has granted legal aid to enable 126 individual VMs to pursue claims for compensation against the Hong Kong Government. Claimants would argue that, having assumed responsibility for the care and management of the VMs, the Hong Kong Government should have taken greater care to ensure their safety. The AG has advised that, on the basis of existing case law, a detention authority may, in some circumstances, be held liable to pay compensation for the injuries, loss and damage caused by some detainees to fellow detainees. Although the outcome of civil litigation is uncertain, there is always a possibility that such liability may be found against the Government if the case is taken to trial.

5. Whatever the outcome of a civil claims trial, the taxpayers will have to bear the legal costs as the claimants are under legal aid. It is difficult to estimate the likely order of cost and duration of a civil trial with any degree of certainty as factors such as the plaintiffs’ counsel’s approach to the trial and the trial judge’s reaction to it are difficult to forecast, but yet relevant. Based on past experience, AG’s rough estimate is that if we dispute both liability and quantum, the trial is likely to take five to six months to conclude.

6. We have estimated the possible costs to the Government of a litigated approach to settle the claim for civil compensation by making reference to the criminal trial of the Shek Kong Incident. The High Court and District

Court criminal trials took two years and 464 trial days respectively to complete and cost over $8 million for prosecuting counsel alone. The costs for defence counsel and solicitors were much higher, given the large number of defendants each of whom had separate counsel and solicitors on legal aid.

7. Regarding the present claim for compensation, on the basis that each side will be represented by two counsel (a leader and a junior), the legal costs will include four sets of counsel’s brief fees and daily refresher fees plus solicitors’ costs during the entire trial period. Leaving aside the brief fees for preparation and first day in court which may well exceed $1.5 million for all counsel, the amount of legal fees could well be in the order of $100,000 per day from the second day onwards. We also need to add the costs of engaging the service of medical and other experts. Thus, our rough estimate is that the trial costs are likely to exceed $12 million.

8. The cost estimate in paragraph 7 above has not taken into account the costs for preparation prior to the trial. Such preparation involves, for instance, the taking of further detailed instructions from the claimants, all of whom are legally aided and most of whom are in Vietnam. Thus, trips to Vietnam by the plaintiffs’ solicitors will be inevitable. Many claimants claim to have suffered serious post-traumatic stress disorder and various kinds of psychological after-effects. On the basis that such medical facilities and expertise are not readily available in Vietnam, medical experts such as neurologists, clinical psychologists, psychiatrists and occupational therapists may have to go to Vietnam to examine those claimants. These costs would all be at public expense. In some cases, it might even be necessary for a judge and counsel from both sides to go to Vietnam to take depositions. It is impossible to estimate the precise amount of funds needed for the pre-trial preparation but a rough estimate suggests that the preparation is likely to take months and incur at least several million dollars of taxpayers’ money.

9. In addition, the litigation approach will inevitably tie up Government’s resources in that senior Government officers will need numerous meetings to prepare the Government’s defence and most if not all officers involved in quelling the disturbance will need to give statements and evidence in court. This process will be extremely time and resource consuming.

10. As the prime objective in resolving the VM saga is to repatriate all the remaining VMs as soon as possible and to close all VM camps, the Government should deploy as a priority all possible resources towards this end. Spending a vast amount of time and resources to handle a trial involving an incident which occurred almost five years ago would detract from our efforts to repatriate the remaining VMs in Hong Kong. It would also send a very wrong signal if we have to bring back as witness VMs already repatriated. It would be far better to resolve the civil claims arising from the incident as quickly and effectively as possible.

11. Of the 126 claimants, 118 have quantified their claims at $36.6 million. The Administration has been able to negotiate a without-prejudice agreement, which is subject to the approval of Members, to settle the claims of the 118 VMs for $28 million. The Administration considers that making a payment of the proposed order to the 118 VMs is a preferred option having regard to the probable magnitude of the costs of a protracted trial and the uncertainty of the outcome of litigation.

12. Progress on the claims of the remaining eight VMs has been slow for two main reasons. First, they have returned to Vietnam or resettled elsewhere before quantifying their claims. Secondly, the claimants have not actively pursued their claims after their departure. However, we do not consider it prudent to hold up the other 118 claims indefinitely simply because we do not know whether and when these eight claims would become active. Moreover, the 118 claimants have become impatient and have threatened litigation if the negotiation process is delayed any longer. Hence, this submission to Members.

13. A table showing the proposed settlement figures for different categories of claimants is at Enclosure 1.

Encl. 1


14. If Members approve the proposed settlement out-of-court, the payment will be charged to Head 106 Miscellaneous Services Subhead 284 Compensation. Since approved provision under the subhead is insufficient to meet the cost of the proposal, taking into account the expenditure already made as indicated at Enclosure 2, we would require supplementary provision of $28 million to meet the cost of the proposed settlement. With Members’ approval, we shall provide the supplementary provision by deleting an equivalent amount from Head 106 Miscellaneous Services Subhead 251 Additional commitments.Encl. 2


The Shek Kong Incident

15. Over 20 000 VMs flooded into Hong Kong in 1991, the year before the Shek Kong Incident. The total VM population stood at 58 700 at the time of the incident. The Government had done everything possible to meet the multifarious urgent demands imposed on it by the sudden influx and to handle an extremely difficult situation.

16. We opened the Shek Kong Detention Centre in June 1989 to accommodate VMs from both North and South Vietnam. We divided the Centre into sections by metal wire and gates. The Southerners occupied Sections A, D and E; the Northerners, Section B; and both Northerners and Southerners who had volunteered for repatriation, Section C. There were an Administrative Area and ‘C Proper’ where we housed the voluntary returnees. The Police managed the Centre in 1992 and the VM population in the Centre then was about 7 000.

17. During the afternoon of 3 February 1992, there was a scuffle between Northerners from huts C5/C6 and Southerners from C1/C2. In that evening, Southerners broke down the gates separating them from the Northerners. The Southerners managed to gain access to the interior of hut C6, where the Northerners lived, and set fire to it. Among the 24 deceased VMs were six men, six women and 12 children (under the age of 16). Seventy-three men, 16 women and 25 children suffered burns and other injuries, some requiring neurosurgery of varying degrees.

Ambit of Head 106 Subhead 284

18. Provision under Head 106 Miscellaneous Services Subhead 284 Compensation is for settlement of claims made against the Government (other than compensation connected with land, public works and mail, and for civil servants under the Employees’ Compensation Ordinance), and for certain ex-gratia payments. Charges on this vote include settlements out-of-court. In September 1982, during consideration of proposed delegation of authority for compensation and settlement out-of-court, Members agreed that authority be delegated to the AG and any person authorised to act on his behalf to agree settlements out-of-court of up to $500,000.

Security Branch
January 1997

Enclosure 1 to FCR(96-97)98

Shek Kong Incident - Proposed Settlement

Death/Extent of injuries

Number of claims

Proposed aggregate settlement





Gross disability (including cosmetic disability) - burns, loss of both upper limbs, loss of vision, psychological effects etc.



Substantial injuries (including cosmetic disability) - second degree burns to knee, forearms and hands, psychological effects etc.



Serious injuries - burns, multiple injuries, psychological effects etc.



Minor injuries - smoke inhalation, injuries to limbs or different parts of body etc.






Enclosure 2 to FCR(96-97)98

Financial Position of
Head 106 - Miscellaneous Services
Subhead 284 Compensation



Approved provision for 1996-97



Supplementary provision approved under delegated authority



Actual expenditure from 1 April 1996 to 31 December 1996



Balance as at 31 December 1996

[(a) + (b) - (c)]



Likely expenditure for settlement of claims by way of court order in the remaining months of 1996-97



Balance after taking into account likely expenditure at (e)
[(d) - (e)]


Last Updated on 5 August 1999