It's evident from looking at it that the top part is intended to flip down to
make an enclosed rectangular box. But there's a carrying handle in the way,
so how is that supposed to work?
But it does work...
The trick to how the lid closes is that it's not really a hinge at all, but a four
bar linkage that lifts the lid over the handle while it's being flipped down.
A side-on view of the hinge linkage. Unfortunately, I neglected to take a photo
of this, so this fuzzy image is a frame from the video that I took.
How it works
I built a simple model of this hinge linkage out of some pieces of plywood
and coat hanger wire.
Part of the trick is that the two links actually cross each other as the lid comes over
the top. This does make the mechanism one that would be tricky to build out of wood
because either the pieces would have to be made very thin, or the linkage would end up
bulky. You can click on any of the above images for a larger view.
A side view of my model. The dark piece of coat hanger wire had to be able to fit under
the brassy looking piece of coat hanger wire. It's not entirely optimal how I built it,
but good enough to demonstrate the linkage.
I made a video showing the tool chest mechanism and my model of it in action:
Jesee Frome made a Sketchup tutorial about how to
design a hinge linkage similar to this one.
My main comment to that it would be idea to space the case-side pin mounts further from each other.