YU HUNG KAR AND OTHERS v. PETER KEE CONSTRUCTION COMPANY

Labour Tribunal Appeal No. 38 of 1985

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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BETWEEN

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JUDGMENT

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1. This is an appeal by Peter Kee Construction Co., which was the trading name of Peter Kee, against two decisions of the Presiding Officer of the Labour Tribunal. The first was a decision on 2nd September whereby he awarded certain sums of money by way of redundancy payments to seven out of eight claimants; and secondly, the refusal of the same Presiding Officer to review his decision on 25th September.

2. For this purpose, an appellant has to show an error of law. The error of law sought to be shown here relates to the Presiding Officer's exercise of his discretion. Specifically it is said here that the exercise of that discretion was in substance vitiated because the Presiding Officer himself failed to fulfil his duty of explaining to this defendant in person his position in the action. This is the error of law of which complaint is made.

3. The claimants were all working on a building site. They claim to have been employed at that site by Peter Kee Construction Co. i.e. Mr. Peter Kee through the instrumentality of a gentleman by the name of Wong, whom they described as the chief supervisor or foreman. In support of his subsequent application for review, Mr. Kee wrote a long letter to the Labour Tribunal dated the 16th of September. It is apparent from what is said in that letter, that there were a good many problems on this particular site as to who was employing whom. Because one finds amongst other things this statement; that for the supply of drillers for the site in question, Peter Kee Construction Co. Ltd. had never employed drillers directly but "had re sub-contracted to the following companies whose terms and conditions are the same." Then the two other companies are referred to. It is apparent from a brief reading of that letter that there were some intricate arrangements on this site which must have made it extremely difficult for any person to tell by whom he was being employed at any one time. Secondly, from the reference to earlier cases before the Labour Tribunal, this was by no means the first case which had reached the Labour Tribunal as a result of these difficulties.

4. It is also apparent from the documentation prepared by the Tribunal before the matter came on for hearing that this point was being taken by both parties. The claimants were asserting that they were in fact employed by Mr. Peter Kee. Mr. Peter Kee was likewise asserting that they were not employed either by him, or, as I understand it, by the limited company, but by a sub-sub-contractor by the name of Wong. In other words, the supervisor was the employer.

5. Issue was then joined upon this matter on the 2nd of September when the matter came on before the Presiding Officer. The notes of the proceedings show that Mr. Kee pointed out at the outset that they had sued the wrong company, the wrong person, and that they should be suing the limited company. The claimants are recorded as having objected to that and as asserting that their employer was the company, not the limited company. Mr. Kee then goes not to explain that there were two concerns of the same name, Peter Kee Construction Co. i.e. him and Peter Kee Construction Co. Ltd. i.e. the limited company. The claimants then assert that documents had once existed eg. time cards, attendance of wages, records of wages receipts which bore the name of the unlimited company. The note then goes on to record that in these circumstances the Presiding Officer tried to explain the difference between limited and unlimited companies. The note then proceeds in this way : - the claimants: "we sue the unlimited company" Mr. Kee "I won't take the role, as defendant in this case". That is exactly what happened. I don't know whether Mr. Kee then left the court or whether he remained sitting and listening. But from that moment onwards the case proceeded undefended. The claimants gave evidence to the Tribunal, which the Tribunal accepted, and made these awards.

6. The first complaint here is that the Tribunal was under a duty, having regard to the special nature of Labour Tribunals where legal representation is not allowed, to explain the situation to this defendant. It was not a matter of whether he declined the role, of defendant or not. He had been named as defendant. If he wanted to resist the claim, he had to remain and resist it and lead evidence in support of his defence. That was a matter which was not explained to him. It is further said that this is something of which Mr. Kee was quite unaware, and that he believed that all he had to do, successfully to resist the claim which had been made against him, was to remain completely silent, and that the matter, as it were, then had to proceed in default in his favour.

7. Mr. Kee is a man who runs a construction company, and documentation has been put before me showing that large sums of money have passed through his hands in that capacity. I do find it very difficult to accept in 1986 that any defendant can be quite so naive as to think that he only has to walk away to win. It becomes particularly difficult to accept this, in the light of the history on this site which is set out in his later letter of the 16th September.

8. But it said that I am driven to this conclusion because the notes of proceedings do not actually record that any advice was given. Therefore I must assume that no advice was given. Therefore it follows from that that whatever the Presiding officer may have said later on, there is in fact conclusive evidence from the omission in the notes of proceedings that no advice was given. Therefore there must have been a breach of duty.

9. Similar criticisms are in fact made about the application for review. In support of that application, Mr. Kee wrote the letter I have already referred to. At the end of that letter he expressly says that he felt that the claimants had sued the wrong company and therefore he said 'no' when he was asked whether he would defend the proceedings. He goes on: "I realize now that even though Peter Kee Construction had no business, that the claimants have sued the wrong company, I should have elected to defend the claim so that I may adduce full evidence as aforesaid." In other words, he was asserting in that letter a mistaken' belief that it was for him to elect to defend or not. It is further pointed out that there is nothing in the notes of proceedings in relation to the dismissal of the application for review on 25th September, in which the Presiding Officer expressly records that there is no substance, in his view, in that belief, because of what had happened on the 2nd.

10. This submission is said to be based upon the provisions of the ordinance; the two relevant sections being 19 and 22(2).  S. 19 says "The Presiding Officer shall keep a summary of the evidence, submissions or statements made or given and of any point of law raised at the hearing and of his decision on such point of law."  S. 22 which deals with awards provides in S. 22(2) "the reasons for an award or order may be given orally or in writing as the Presiding Officer may think fit." Written reasons were given some month after the refusal of the review on 25th September, but in fairness to the Presiding Officer, before any detailed notice of appeal criticizing him on this basis had been filed. What is being said is that the Presiding Officer cannot in those reasons say anything which can be dubbed as fresh evidence, which does not in fact appear in the notes of proceedings.

11. I cannot accept this submission for a number of reasons. The first is that I have the gravest doubts whether, on the true construction of S. 19, it bites at all upon explanations given by the Presiding Officer. It said that these constitute "statements." That, to my mind, is not the prima facie meaning of this section. The section puts together "evidence, submissions or statements," and I believe that the section is directed mainly to the evidence, arguments and statements advanced by claimants and respondents in support of their respective cases.

12. Secondly the obligation, (if I am wrong on that), is only to give a summary. Although it may be desirable for a Presiding Officer to recall the advice he gave, it is in fact in practice extremely difficult for a judge to record fully everything he says by way of explanation to a litigant in person, who is or may be, unfamiliar with what is going on. Recording their submissions, evidence and statement is one thing; recording his own explanations is another, because he cannot both give the explanation and make the record of what it is happening. Ex post facto explanations or records like this, very often can be overlooked and are inadequate in form.

13. Thirdly I cannot believe that the legislator's intention was that S. 22(2) was to be read subject to S. 19, so that nothing could be advanced by way of reasons, which is not in fact recorded in the summary of proceedings which the Presiding Officer had taken.

14. If one looks at the reasons given in this case, one can see that the Presiding Officer is saying that on the first occasion, he made the position clear to this defendant. The reasons include this statement: "Against my advice that he had to defend the case in the circumstances e.g. by proving with evidence to the Tribunal that the claimants were actually employed by the limited company, and that Tribunal would, if otherwise, hear the case ex parte, the defendant Mr. Kee still refused to answer the claims which remained, being claims against his firm rather than against his limited company."  In other words, the Presiding Officer is saying; Before I recorded Mr. Kee's refusal to take the role as defendant in this case, I explained to him the consequences of what he was proposing to do. I am quite unwilling to reject that statement on the basis that I am bound by the notes of proceedings.

15. Precisely the same thing arises in relation to the dismissal of the review. He explains that in his reasons: "I summarily dismissed the same (i.e. the application) because of the view that since on the day of the hearing, everything including the claims, and the stand that the claimants took as regards the name and identity of the defendant, (of which Mr. Kee himself is a sole proprietor,) as well as my advice aforementioned, was made abundantly clear to Mr. Kee, it would be unfair to permit a replay of the match, which had been wilfully given up by the defendant under such unmistakable circumstances." Really the whole burden of the applicant's submission here is that I must reject all that as false. I must reject it as false because it not specifically recorded in the notes of proceedings. I do not see any basis in fact or law for that proposition. It necessarily follows that the whole burden of the complaint which is made against the Presiding Officer in this case fails.

16. This was a case where there were disputes on a building site, of which Mr. Kee, I am satisfied, was in fully aware, with problems about identifying employers. On the first day he took a particular stand, that he was declining to participate in the claim against him on the basis upon which it was then put. The Presiding Officer, I am satisfied, did his best to explain the situation to him without result. It seems to me that in those circumstances Mr. Kee has no legitimate complaint about what happened on 2nd September; and he cannot say that the discretion which the Presiding Officer exercised on 25th September is one which, (and I am quoting from Mr. Justice Mantell in Wong Siu-chine), "that no reasonable tribunal acting reasonably in the circumstances could have reached."  Because I believe that that is in fact the proper basis of testing the exercise of a discretion in an Appellate Court when it cannot be shown to have been taken on any basis which can be said to be wrong in principle. In those circumstances, in my judgment, this appeal fails and must be dismissed.