MOK TAI KEI v. HONG KONG BAPTIST UNIVERSITY

[English Translation – 英譯本]
HCLA 41/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 41 OF 2003

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM
NO. 11269 OF 2002)

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JUDGMENT

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Background

1. The Claimant was a professor at the Faculty of Social Work of the Hong Kong Baptist University.  Upon dismissal by the University, the Claimant instituted proceedings in the Labour Tribunal, seeking an order for reinstatement or re-engagement pursuant to section 32N of the Employment Ordinance (Cap.57) and also claiming severance payment, terminal payment and compensation under section 32P of the Ordinance.  The claim was dismissed both at first instance and upon review.  Having obtained leave to appeal, the Claimant now appeals to this court.

2. The Claimant was a substantiated appointee of the University.  The contract of employment between the Claimant and the University provided for various restrictions and procedures that were to be observed if the University was minded to dismiss the Claimant.  Clause 16 of the contract of employment provided as follows:

16.    TERMINATION OF APPOINTMENT BY THE UNIVERSITY

16.1  The University may terminate the appointment of a non-substantiated appointee without cause by giving three months’ notice in writing or three months’ salary in lieu of notice, in which case the appointee may be given a payment in lieu of the annual leave that has accumulated but not been taken but in no case shall the payment exceed the equivalent of 91 days’ salary.  In the case of an appointee on fixed-term employment, terminal benefits under the contract such as gratuity and homeward passage shall be provided.

16.2  If in the opinion of the President & Vice-Chancellor, a non-substantiated appointee at any time neglects or refuses to perform any of his duties or in any manner misconduct himself, he may be dismissed by the Council after due enquiry, and on such dismissal all rights and advantages of his appointment shall cease.

16.3  A substantiated appointee may be removed from appointment on grounds of misconduct, inefficiency or other good causes by the Committee on Termination of Appointment, to be formed upon the recommendation of the President and Vice-Chancellor, and as constituted by the Chairman of the Personnel Committee of Council, comprising 5 members of the Personnel Committee (of whom at least 2 must be lay members) and to be chaired by one of the lay members, and subject to the provisions set out in Appendix F.

16.4  An appointee may be removed from appointment by the Council in any case where it has decided on or required to make a change in the University staffing requirements, in consequence of which the appointee is made redundant in that the staffing need which he was appointed to fill no longer exists.  In all cases of termination of appointment under this clause, three months’ notice or three months’ salary in lieu of notice shall be given.  An appointee shall be given a payment in lieu of the annual leave that has accumulated but not been taken but in no case shall the payment exceed the equivalent of 91 days’ salary.

3. The applicable Appendix F provided as follows:

APPENDIX F
REGULATIONS GOVERNING REMOVAL FROM APPOINTMENT

The removal from appointment of a substantiated staff member shall conform to the following procedure:

1.      In the event of misconduct, inefficiency or other good cause, the President & Vice-Chancellor may suspend from duty the member of staff concerned and take such other action as may be necessary in cases of urgency.  The President & Vice-Chancellor may recommend to the Personnel Committee of Council to convene the Committee of Termination of Appointment to enquire into the matter before the suspension or as soon as practicable thereafter. 

2.     The following regulations shall apply to the meeting of the Committee on Termination of Appointment convened to consider and decide any question which may involve the removal from appointment of an appointee.  The word “Committee” used in this context shall therefore apply to the Committee on Termination of Appointment and where appropriate the Council itself.

2.1   The appointee shall be entitled to appear and to be heard, accompanied by a friend who must be an appointee of the University, at any meeting of the Committee at which a question which may involve his removal from appointment is to be considered.  The appointee shall be given written notice of all allegations made against him at least 20 working days before any such meetings.

2.2   Any decision to remove an appointee from appointment shall be by the votes in favour of not fewer than half of the total number of members of the Committee.

2.3   A quorum for the meeting shall be a number equal to one more than half of the total number of members of the Committee.

2.4   In reaching decisions, the Committee shall be guided by the balance of probabilities in each particular case.

3.     Any staff member who is removed from his appointment consequent upon the decision of the Committee on Termination of Appointment may appeal to the Council whose decision shall be final.  The Council shall have power to prescribe from time to time regulations as to the mode, manner and procedure to be followed on any such appeal.

4.     The procedure relating to the removal from appointment or suspension of the Academic Vice-President and Vice-Presidents shall be identical with that specified in the foregoing paragraphs except that

(a)    the power to suspend or take other such action as may be necessary shall rest with the Chairman of the Council or, in his absence, the Deputy-Chairman;

(b)    the Committee that is to consider and decide upon such removals shall be the Council itself and that being so no right of appeal shall be allowable; and

(c)    The Council shall have absolute discretion to decide on the extent to which the rights and advantages of the appointment shall be forfeited.

4. Put simply, the University’s case is that, on the basis of complaints from a number of students over the Claimant’s performance, the University convened a Committee of Termination of Appointment (CTA) in accordance with the above provisions, so as to consider whether the Claimant’s employment was to continue.  In their report, the 5 members of the CTA took the unanimous view that the Claimant was seriously derelict in his teaching duty and consistently failed to achieve the standard and efficiency as required by the University, and therefore the University decided to dismiss the Claimant pursuant to the applicable provisions quoted above.  The Claimant appealed to the Council in accordance with the procedure stipulated in the provisions quoted above, and the appeal was dismissed.  Thereafter, the Claimant commenced proceedings in the Labour Tribunal.

The Tribunal’s ruling

5. The main reason given by the Tribunal for its ruling against the Claimant was that the University was established pursuant to the Hong Kong Baptist University Ordinance (Cap.1126) and enjoyed the status of a separate body corporate.  The Ordinance, in the Tribunal’s view, empowered the University to set terms of remuneration and conditions of service for staff, and it was open to the University to dismiss any member of staff in accordance with those terms.  If the member of staff concerned was dissatisfied with the University’s decision, he or she could only seek relief by applying to the Court of First Instance for judicial review, and could not seek relief by commencing proceedings in the Labour Tribunal over the question of whether the University was entitled to dismiss him or her under the contract of employment or the Employment Ordinance.

Arguments advanced by the University

6. At the hearing of this appeal, Mr. Au, Counsel for the University, made submissions in support of the ruling of the Labour Tribunal.  Referring to sections 7(d) and 30(d) of the Hong Kong Baptist University Ordinance, Mr. Au pointed out that the Ordinance conferred upon the University the powers to set terms of remuneration and conditions of service for staff and to make provisions for the discipline of persons employed by the University.  It followed that whether an employee of the University was to stay or go was to be determined in accordance with the terms of remuneration, conditions of service and disciplinary provisions laid down by the University.  Where the University had acted in breach of those terms, conditions and provisions, the employee concerned could seek relief from the court by way of judicial review, but he or she could not commence proceedings in the Labour Tribunal on the ground that the University had acted in breach of the contract of employment.

7. Sections 7(d) and 30(d) of the Hong Kong Baptist University Ordinance provide as follows:

7.      The powers of the University

Subject to section 8, the University shall have power to do all such things as are necessary for, or incidental or conducive to, or connected with, the furtherance of its functions and may in particular, but without prejudice to the generality of the foregoing — (Amended 93 of 1994 s. 11)

…

(d)     set terms of remuneration and conditions of service for staff;

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30.    Power of the Council to make statutes

The Council may make statutes for the better carrying out of the provisions of this Ordinance and in particular, but without prejudice to the generality of the foregoing, may provide for —

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(d)     the discipline of persons in the employment of the University;

…

8. Mr. Au also cited the UK House of Lords decision in Thomas v University of Bradford [1987] 1 AC 795 to support his argument.  In that case, the House of Lords held that, under the common law applicable to the UK, academic visitors of a university in that country have exclusive jurisdiction over disputes regarding the correct interpretation and fair execution of internal statutes and legal provisions of that university, whether or not such disputes also involve an employment contract between the university and its employee and the rights and duties thereunder.  Mr. Au acknowledged that the common law principle on the jurisdiction of academic visitors does not apply to Hong Kong.  However, he sought to extend the scope of the case and argued that the powers conferred by the Ordinance upon the University in respect of the management of internal matters (including the employment, dismissal and discipline of staff) were analogous to the exclusive jurisdiction of academic visitors, and hence the University or its Council, like an academic visitor, enjoyed exclusive jurisdiction over disputes regarding the above matters.  A member of staff disgruntled with the relevant decision could, so it was argued, only seek relief from the court by way of judicial review and could not seek private law adjudication or relief from the Labour Tribunal or the court on the ground that the University had been in breach of the contract of employment.

Section 7(d) of the Ordinance

9. In my view, in the circumstances of the present case, Mr. Au’s argument cannot take hold.  Section 7(d) of the Hong Kong Baptist University Ordinance does no more than conferring upon the University the power to “set terms of remuneration and conditions of service for staff”.  The Ordinance does not provide that the University has jurisdiction (not to say exclusive jurisdiction) over the question of whether it has complied with those terms of remuneration and conditions of service, so that not even the Labour Tribunal — a tribunal which was specifically established and given exclusive jurisdiction under the Labour Tribunal Ordinance (Cap.25) to adjudicate on labour disputes — can have any say in the dispute involved in the present case.

10. This, in my view, could not have been the intention of section 7(d) of the Hong Kong Baptist University Ordinance, and no such jurisdiction has been conferred upon the University.

Section 30(d) of the Ordinance

11. Section 30(d) empowers the Council of the University to make statutes, in particular to make provisions for “the discipline of persons in the employment of the University”.  I do not intend to, nor do I see any need to, provide a definitive interpretation on the true meaning of section 30(d) and the scope of power that it confers upon the University.  This is because Mr. Au’s argument in this respect contains a fatal flaw.  It is clear that section 30(d) empowers the Council to make statutes.  Mr. Au agreed that statutes are in fact a type of subsidiary legislation (see the definition of “subsidiary legislation” under section 3 of the Interpretation and General Clauses Ordinance (Cap.1)).  Section 28(2) of the Interpretation and General Clauses Ordinance provides that subsidiary legislation shall be published in the Gazette, and section 34 of the same Ordinance provides that all subsidiary legislation shall be laid on the table of the Legislative Council at the next meeting thereof after the publication in the Gazette of that subsidiary legislation, and that the Legislative Council may amend such subsidiary legislation.  Mr. Au conceded that the Council of the University has never exercised the power conferred by section 30(d) of the Hong Kong Baptist University Ordinance to make statutes, have them published in the Gazette and have them laid on the table of the Legislative Council.

12. By way of contrast, I notice that the University of Hong Kong has, in exercise of the power conferred upon it by section 13 of the University of Hong Kong Ordinance (Cap.1053), properly made statutes which have been appended to the University of Hong Kong Ordinance by means of a Schedule.  This is markedly different from the exercise by the Baptist University of the power conferred upon it by section 30 of the Hong Kong Baptist University Ordinance.

13. Accordingly, I do not have to rule on the question of the exact scope of power conferred by section 30(d) on the Baptist University, in particular any jurisdiction or exclusive jurisdiction over the discipline of the University’s employees.  Up to this point in time, the University has not exercised the relevant power to make statutes or provide for the discipline of persons employed by the University.  Therefore, there is no factual basis to support Mr. Au’s submissions in this respect.

Clause 16.3 and Appendix F of the contract of employment

14. As regards paragraph 3 of Appendix F referred to in Clause 16.3 of the relevant contract of employment (quoted above), that paragraph does make it clear that, on an appeal by an employee to the Council against a decision of the CTA, the decision of the Council shall be final.  That said, Mr. Au conceded in his submissions that, quite regardless of the possible powers that section 7(d) and 30(d) may, as Mr. Au contended, have conferred upon the University (and I have dealt with this question above), paragraph 3 of Appendix F per se does not displace the jurisdiction of the Labour Tribunal over the labour dispute involved in the present case.

15. Such concession was, in my view, very sensibly made.  As stated above, I do not think that, in conferring the power to set terms of employment, section 7(d) of the Ordinance thereby confers upon the University any exclusive jurisdiction or power of final adjudication over any labour dispute with the University’s employees, or thereby displaces the jurisdiction of the Labour Tribunal or an ordinary court.  Nor, in my judgment, is such intention to be found in paragraph 3 of Appendix F.

16. Similarly, I do not think that the ordinary jurisdiction of the Labour Tribunal or the court over labour disputes can be circumvented by reading into the relevant contract of employment (particularly the terms quoted above or Appendix F to that contract) an arbitration clause and treating the CTA and the Council as part of an arbitration mechanism.  Mr. Au also indicated agreement with this in his submissions.

17. In my view, as far as dismissal of the Claimant by the University is concerned, the CTA was, according to Clause 16.3 and Appendix F, the body responsible for looking into the matter and making the decision to dismiss the Claimant.  As a matter of common sense, in making the decision that it did, the CTA must have considered that there existed “misconduct, inefficiency or other good causes” to support the decision.  However, Clause 16.3 does not state that the CTA has the power to make a final adjudication on whether the employee is indeed guilty of misconduct or inefficiency or whether there are other good causes for dismissing the employee.  If in fact there is no reason for dismissal, the CTA is not entitled to make the decision to dismiss the employee; and if the CTA has indeed wrongly made such decision, the Council is not entitled to dismiss any appeal that the employee may lodge.

18. In my view, on a correct reading of the relevant contractual provision, the Council’s power of making a “final” decision must rest upon the basis that there did exist “misconduct, inefficiency or other good causes” (as expressly set out in Clause 16.3) that justified dismissal of the employee.  If these reasons did not in fact exist, the dismissal procedure under Appendix F (including the appeal to the Council and the making of a final decision by the Council mentioned in paragraph 3 therein) would not be brought into play at all.

Conclusion

19. In view of the above, Mr. Au has failed to provide any valid reason, whether under the relevant Ordinance or the relevant contract of employment or otherwise, to support the Labour Tribunal’s ruling that it had no jurisdiction over the labour dispute in question.  For the reasons set out above, I do not accept the contention along the same line.

20. Since the above reasons are sufficient to dispose of the issue over jurisdiction that arises in the present appeal, I do not intend to express any view on certain broader issues; in any event, any view that I may express will not form part of the ratio of my judgment.  Those broader issues include: if the Baptist University does, pursuant to section 30(d) of the Ordinance, make statutes and provides for the discipline of persons employed by the University, and if those statutes provide that matters pertaining to the discipline of the employees (including the dismissal of employees as a sanction) are to be dealt with by a mechanism set up by the University itself and that all relevant decisions are to be final, then will these provisions serve to displace the jurisdiction of the Labour Tribunal or an ordinary court over any contractual dispute that may have arisen at the same time?  Another related issue is: is Mr. Au’s contention based on the exclusive jurisdiction of academic visitors under the common law of the UK valid in the context of section 30(d)?  These issues may have far-reaching implications: apart from the relationship between the Claimant and the University, these issues may have a bearing on the relationship between the University and other members of staff, and, on a general level, the relationship between other local tertiary institutions and their members of staff.  Given it has not been necessary for me to give an answer to these issues in disposing of the present appeal, and in the absence of any submission made on behalf of the Claimant on these issues,  I consider it proper to leave these issues for consideration by the court in an appropriate case in future.

Issues to be dealt with by the Tribunal

21. As stated above, the Presiding Officer of the Labour Tribunal ruled that the Tribunal had no jurisdiction over the labour dispute in the present case. For this reason, he had not seen fit to investigate into (or give findings of fact on) the Claimant’s complaints (including the allegations that he had not misconducted himself or performed badly on teaching and that it was unreasonable for the University to dismiss him) or whether there existed “misconduct, inefficiency or other good causes” (to quote Clause 16.3 of the contract of employment) to support the decision to dismiss the Claimant.  It follows that the Tribunal had neither investigated into (or made findings of facts on) the loss or damage suffered by the Claimant in the event that the University did dismiss him in the absence of the reasons stipulated in the contract of employment, nor granted relief within the jurisdiction of the Tribunal in respect of any such loss or damage.  In my view, these are issues on which the Tribunal has the power and duty to adjudicate.

22. Finally, in paragraph 22 of the Reasons for Adjudication, the Presiding Officer mentioned the issue of calculation of severance payment and terminal payment claimed by the Claimant.  In opposing the present appeal, Mr. Au for the University did not make any submission in support of the Presiding Officer’s ruling on that issue.  Given that the Presiding Officer has, in my judgment, erred on the issue of the Tribunal’s jurisdiction, that the parties’ cases are to be investigated into and ruled upon, and that the case is to be remitted to the Tribunal for re-hearing, questions relating to relief should also be dealt with by the Presiding Officer at the re-hearing.  Furthermore, I have to point out that, under the contract of employment between the parties, unless the University can justifiably dismiss the Claimant on the basis of Clause 16.3, it is not entitled to dismiss the Claimant in breach of the contract by giving notice and 2 months’ notice payment (and the Claimant also got back long service payment).  In other words, the loss or damage suffered by the Claimant may be far greater than what the said monetary compensation covered.  This question goes to relief and also relates to the jurisdiction of the Tribunal over the granting of relief.  Since re-hearing is necessary and since the question involves findings of fact, I consider it neither necessary nor desirable to express any view.

Orders

23. Accordingly, I order that:

(1)   the appeal be allowed;

(2)   the relevant order of the Tribunal be set aside;

(3)   the Claimant’s claim be remitted to another Presiding Officer of the Tribunal for re-hearing.

24. As regards costs, I make an order nisi that the Defendant is to pay the Claimant costs, to be taxed if not agreed.  Unless any party hereto applies within 14 days from the date of delivery of this judgment for variation of the order, the said order nisi will automatically be made absolute upon the expiry of 14 days.