Q1. What should drivers and pedestrians do when the light signal is not working?

There is no law which governs such situation. However, it is generally accepted that drivers and pedestrians should adopt the following practice:

drivers and pedestrians should treat intersections with failed traffic lights as four-way stops; that is to say, all vehicles have to come to a complete stop before proceeding further;
vehicles entering from a minor road should give way to those on the major road;
drivers should always give way to the vehicle on your right;
drivers should always give way to pedestrians;
pedestrians should always proceed with exceptional care; and
after all, it all boils down to one single rule: be patient and courteous.