POON CHUN HING v. HAI TAT TRANSPORTATION CO LTD

HCLA 92/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 92 OF 2005

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO. 2332/2005)

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HCLA 93/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 93 OF 2005

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO. 2847/2005)

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BETWEEN

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D E C I S I O N

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1.  This is an application for leave to appeal against two awards made by a presiding officer of the Labour Tribunal on 2 November 2005.  The awards have been confirmed at the review on 17 December 2005. 

2.  The claimants of two different claims were former employees of the respondent/applicant.  They were employed as drivers to drive trucks across the Mainland/Hong Kong border.  The 1st claimant, after having resigned from the respondent, claimed annual leave with pay and holiday with pay.  The 2nd claimant claimed wages in lieu of notice for termination of service without notice and annual leave with pay.  The respondent denied these claims.

3.  The respondent’s case was that the claimants were paid 26% of the fees collected from customers.  Of that 26%, which were called commissions, 23% were for wages for their work, 2% were for their annual leave with pay and holiday with pay, and the remaining 1% was called an annual accumulation fund paid to cover any possible shortfall of payment for the annual leave and the holiday with pay.

4.  It is the defendant’s case that this formula of payment was used in the employment agreements made with each and every driver employed by the defendant or it was a general practice of the defendant in employing drivers.  The defendant also relied on the wage receipts which specified that the 26% included payments for holiday with pay and the annual accumulation fund.

5.  On the claim for wages in lieu of notice by the 2nd claimant, the respondent alleged that the 2nd claimant had resigned instead of having been terminated by the respondent.  Thus, no wages in lieu of notice was payable.

6.  Regarding the payment package, the claimants agreed that they had been interviewed for the job and had been told at the interviews that their wages were set at 26% of the fees paid by the customers, but they denied that anything had been said about the 2% out of the 26% being for the annual leave with pay and holiday with pay and the 1% was for the so-called annual accumulation fund.

7.  At the trial, the first issue was whether when the claimants were employed, it had been agreed between them individually and the respondent that there was this splitting of the 26% commission to 23% for wages, 2% for annual leave and holiday remuneration and 1% for the annual accumulation fund.  The second issue was whether the 2nd claimant had been dismissed without notice.

8.  The presiding officer after the trial accepted the case of the plaintiffs and awarded them with what they claimed.  The respondent now applies for leave to appeal against the presiding officer’s decision.  There are seven grounds of appeal in the Revised Application for Leave to Appeal on Point of Law, but they all seem to focus on the payment package and not on the dismissal.

9.  Ground 1 reads:

“The presiding officer failed to take into consideration and/or misinterpreted the evidence of the Claimant and the Defendant and thereby erred in law in concluding that the evidence of Mr Mak should not be believed.  It is submitted that the admission of the Claimant that he fully appreciated the content of the receipts for payment together with the words of the receipts for payment clearly shows that there was an agreement made between the Claimant and the Defendant for the payment of the holiday and annual leave pay.”

10.  Counsel submitted that the words on the receipt were in support of the respondent’s case.  However, the receipt merely said that the 26% included holiday with pay and the annual accumulation fund.  The presiding officer took the view that if there was the agreement for 2% to be for the annual leave with pay and holiday with pay and 1% for the annual accumulation fund, it was strange that there was no such reference on the receipts.  I do not think one can say that the presiding officer was not entitled to this view, particularly after he had seen and heard all the witnesses. 

11.  Counsel also submitted that the presiding officer had not questioned the 1st claimant on why he did nothing after receiving the receipt with the words abovementioned.  However, the 1st claimant had already said that because the meaning of those words was too generalised, he also did not agree with them and did not think them correct.  There was also no mention if the holiday pay constituted 20% of the commission or otherwise.  He regarded that as a matter for all the drivers and the drivers also did not think that the words were correct and did not agree with them.  His own words at the trial were:

“因為當時佢咁籠統，我又對佢呢啲嘢又不以為然，究竟係有薪假係咪百分之二十有薪假呢，佢完全就冇乜嘢，咁見到係大圍事，當時亦都不以為然”

It was on this basis that he did not do anything about it. 

12.  The 1st claimant had thus dealt with the question of why he did nothing.  I do not think the presiding officer should have gone further to cross-examine him.  Therefore, the first ground has no merit.

13.  Ground 2 reads:

“The presiding officer failed to take into consideration and/or misinterpreted the evidence of Miss Wong and Mr Mak and thereby erred in law in concluding in his oral judgment that the evidence of Miss Wong contradicted the evidence of Mr Mak and later in his written judgment that Miss Wong’s evidence did not support the saying of Mr Mak.”

14.  It was the clear evidence of Mr Mak for the defendant that he had personally discussed the payment package with the 1st claimant.  The evidence of Miss Wong of the defendant was that the payment package was discussed between the 1st claimant and Mr Mak’s wife who is also surnamed Wong.  Miss Wong could not recall whether Mr Mak was also present at the interview.  She however said that the 1st claimant had indeed met Mr Mak, but that was on the occasion after the employment agreement had been made as the 1st claimant was coming to the office with his travel documents for registration purpose.

15.  I can therefore clearly see an inconsistency between the evidence of Mr Mak and that of Miss Wong.  It was the issue of who discussed with the 1st claimant on the payment package.  Miss Wong’s evidence thus contradicted that of Mr Mak.  The presiding officer was right to say so.

16.  The third ground reads:

“The presiding officer misinterpreted the evidence of Mr Yeung and thereby erred in law in concluding that the case of the Claimants was supported by the evidence of Mr Yeung.”

17.  Mr Yeung was called by the claimants.  He said at the employment interview that he was only told that the 26% commissions would be his wages.  The presiding officer then asked him whether there was any discussion on splitting this 26% into smaller portions.  He said no. 

18.  Counsel for the respondent complained that the presiding officer had accepted Yeung’s evidence and to find for the claimants.  I see nothing wrong in that.  The respondent was putting forward a case of a company practice by the evidence of Mr Mak and Miss Wong.  The claimant called Mr Yeung to contradict that. 

19.  Counsel also complained that the presiding officer had not said in the judgment that he was using Mr Yeung’s evidence as a matter of the respondent’s company practice, but it is quite apparent that Yeung’s evidence was to contradict the respondent’s case of a company practice.

20.  The fourth ground reads:

“Further or alternatively, the presiding officer failed to discharge his duty by not putting the relevant and proper questions to the witnesses of the Claimants before he ruled against the evidence of the defendant.  It is submitted that the Presiding Officer has never put to Mr Yeung the proper and relevant questions as to whether there was agreement made between the staff and the Defendant for the payment of the holiday and annual leave pay.  The Presiding Officer has also failed to put to Mr Yeung the proper and relevant questions concerning the receipts for payment of the claimants.”

21.  The first part of this ground on whether the presiding officer had put to Mr Yeung the proper and relevant question on the agreement between the staff and the defendant for payment of holiday and annual leave pay has no merit.  I have already referred to the question by the presiding officer to Yeung on whether there was any discussion on splitting the 26% commission into smaller portions.  I think the presiding officer, after having received a negative answer from Yeung, should not have gone further as that could have amounted to cross-examining Mr Yeung.  By asking that question, I am of the view that the presiding officer has already discharged his duty to investigate what had been discussed on the payment package between Yeung and the defendant.

22.  On the argument that the presiding officer did not question Yeung on the words on the wages receipt, I would refer to the case of Chan Suk Bing Angie v Harbour Phoenix Limited [1992] 2 HKC 459 at 462:

“Section 20 of the Labour Tribunal Ordinance, Cap. 25 provides that hearings at the tribunal shall be conducted in an informal manner.  This is mainly due to the prohibition against legal representation in the tribunal.  This in turn brought about s.20 (3) which provides that “the presiding officer shall investigate any matter which he may consider relevant to the Claim, whether or not it has been raised by a party”.  In the premises, hearings at the tribunal are inquisitorial, rather than adversary in nature.  In view of the lack of legal representation and the informal nature of the hearings, there is thrusted upon the presiding officers the duty to investigate relevant matters irrespective whether they are raised or relied upon by any party.  Despite the enormous workload that exists in the tribunal and the speed the Ordinance requires the claims to be dealt with, presiding officers should not allow themselves to derogate from this statutory duty under any circumstances, if a fair and just disposition of the Claim is to be ensued.  The requirements of justice in a judicial system such as the tribunal is such that the presiding officers are required to assume an active inquisitive role in the proceedings.  I accept, as Mr Lin for the Respondents suggests, that such a statutory duty is not an absolute one in the sense that the presiding officers do have a “discretion” in the matter.  They are only bound to investigate matters they “may consider relevant”.  However, I reject Mr Lin's contention that such “discretion” is an absolute one and is not susceptible to interference by an appellate court.  Notwithstanding the prohibition against reversal or variance of determinations of facts under s.35 (2) of Cap 25, I do not accept Mr Lin's submission that the presiding officers” determination of the “relevance” of a matter for the purpose of discharging their statutory duty to investigate is a matter not open to the appellate court.  Firstly, very often, as in the present case, no conscious express determination of relevance would be made by the presiding officers; in which case no question of any prohibition under s.35 (2) can arise.  It is then for the appellate court to determine if the matter alleged is a relevant matter which ought to have been investigated.  Secondly, the relevance of a matter would inevitably depend on the issues of law and facts involved.  The application of legal principles, or the failure to do so, in reaching a determination on the relevance is a matter upon which an appeal can lie.

It is obvious that not every failure to investigate a relevant matter will give rise to an appeal for a failure to discharge a statutory duty.  The relevant matter forming the subject matter of the complaint must not only be relevant, but be of such a nature that the lack of investigation will give rise to injustice in that a fair and proper determination of the claim cannot be attained.  All the circumstances of the case as well as all other findings of fact must be given all due regard before such a complaint can be upheld.  Further, not only is the total absence of investigation a ground for complaint, totally inadequate or useless investigation which amount to no investigation at all will also suffice.  It is, however, never sufficient for the appellate court to conclude that it would have preferred to approach the matter differently, or that there is a better way to investigate the claim.  It is not open to the appellate court to prefer its own views to that of the presiding officers as to the manner of investigation.  To suffice, it must be a clear and obvious case that the inadequacy of the investigation will render an ordinary reasonable man on the tram to Shaukiwan to conclude that injustice has resulted in that a fair and proper determination of the claim cannot be attained.”

23.  I also refer to the case of James Manuel Ho and Anor v Grand Pacific Vacation (Hong Kong) Limited HCSA5/2004 by Chung J where, in relation to a similar duty of the adjudicator in the Small Claims Tribunal, the learned judge referred to the following legal principles on investigation:

“(a) the duty to inquire is limited to a duty to inquire into any matter “which it may consider relevant to a claim”;

(b) the duty is not absolute;

(c) not every failure to inquire a relevant matter gives rise to a valid ground of appeal.  The failure must be of such a nature that it gives rise to injustice in that a fair and proper determination cannot be attained;

(d) “matter … relevant to a claim” can cover matters of various degrees of relevance to a claim.  The Tribunal has no duty to inquire into all matters of relevance irrespective of whether they have a reasonable basis;

(e) the manner of investigation is a matter of discretion for the Tribunal dependent on the facts of the case before it.  The appellate court should not interfere with that discretion merely because it would have exercised it in a different manner.  Regard can be taken of matters such as the issues in dispute, the incontrovertible evidence before the Tribunal and materials placed before the Tribunal by the parties prior to the trial before the Tribunal;

(f) on the other hand, the duty to inquire does not mean the Tribunal should take over the role of an advocate for a litigant.  The Tribunal must remain neutral and impartial.  Thus, litigants must still be allowed to cross-examine witnesses for the other side, and litigants cannot be compelled to testify against their wishes.  But the Tribunal has a duty to invite litigants to consider giving evidence when it is apparent he could give evidence on important matters in issue;

(g) the duty to inquire can include the Tribunal inviting the parties to comment on matters, or, if necessary, directing them to produce evidence or documents, relating to matters which the Tribunal discerns to be important.”

24.  The first thing to note is that Mr Mak of the respondent also raised no question for Mr Yeung on this point.  I think it would have been proper for the presiding officer to apply some neutral questions to Yeung on the words on the wages receipt, but he should not cross-examine Mr Yeung on this.  However, given the fact that the 1st claimant had already dealt with this, this slight imperfection, in my view, is far from being enough to upset the judgment.

25.  The fifth ground reads:

“The Presiding Officer failed to discharge his duty by not putting the case of the Defendant to Mr Yeung for clarification before he ruled against the evidence of the Defendant.  In the premises, Mr Yeung has, in effect, not been cross-examined for the case of the Defendant.”

26.  I reiterate that it is not for the presiding officer to cross-examine any witness for either party.  I think this is a simple case.  In the light of the negative answer by Yeung to the question of the presiding officer on whether there was any discussion on splitting the 26% commission into smaller portions, I do not think it necessary for the presiding officer to put the defendant’s case to Mr Yeung. 

27.  Ground 6 reads:

“The Presiding Officer failed to resolve the conflicts between the receipts for payment and the evidence of Mr Poon and his witness statement before he ruled against the evidence of the Defendant.  In his testimony, Mr Poon admitted knowing the content of the receipts for payments.  On the other hand, it is stated in his witness statement that he had never signed any documents to that effect.”

28.  There are two points here.  The first point is that the 1st claimant had admitted that he was aware of the words in the wages receipt when interviewed for the job.  This point, unfortunately, arises from a misreading of the evidence.  The 1st claimant was giving evidence on what was said at the interview.  He said there was no mention that the 26% included payment for annual leave and holiday with pay.  He then referred to a later stage when he received his wages and thus became aware of the words on the wages receipt.  After this, his evidence then returned to the employment interview.  He never said that he was aware of the words on the wages receipt at the interview.  Thus, this point has no merit.

29.  The second point is that the 1st claimant had lied in his witness statement that he had never signed any document to the effect that the 26% wages included annual leave and holiday with pay.  Counsel pointed out that he had in fact signed wages receipt which contained the words “the total business income x 26% already included holiday with pay (總營業額已包有薪假期) or the total business income x 26% already included holiday with pay and annual accumulation fund (總營業額已包有薪假期及年積金).”  Counsel thus submitted that the 1st claimant had lied in his witness statement.

30.  However, the claimant only stated in his witness statement that he had never signed any undertaking or promise in relation to the 26% wages which was to include annual leave with pay and holiday with pay.  The wages receipts were not undertakings or promises.  The defendant did not suggest in evidence that the receipts were intended to be agreements or that the drivers were asked to sign them every month so as to enter into agreements containing these terms every month.  I do not think the undertaking or promise that the 1st claimant had referred to in his witness statement was what was referred to in ground 6 of the grounds of appeal.

31.  Ground 7 complains that:

“The presiding officer failed to discharge his duty by not putting the relevant and proper questions to Mr Ng and/or failed to consider the relevant and proper issues of the case before he ruled in Mr Ng’s favour for the claim of annual leave pay.  It is submitted that the Presiding Officer has not asked Mr Ng questions concerning the disputed agreement for the payment of the holiday and annual leave pay.  Mr Ng has never been asked about his knowledge of the words in his receipts of payment.” 

32.  Mr Ng was the second witness for the claimants.  His evidence and cross-examination focused on his termination/dismissal.  He did say that he had not been given any annual leave with pay.  There was no cross-examination of him on the payment package by the defendant at all.  The presiding officer could have asked him whether there was any discussion on splitting the 26% commission into smaller portions and then to ask him how did he react upon seeing the words on the wages receipt, but the presiding officer could not have cross-examined the 2nd claimant on these matters. 

33.  The failure of the presiding officer to ask these questions constitute a minor imperfection, but in the light of the evidence of the 1st claimant and Mr Yeung and the fact that the 2nd claimant was present at the trial throughout, I do not expect the 2nd claimant would have said anything to agree with the defendant’s case.  The presiding officer has seen and heard the witnesses and considered the documents before coming to his decisions.  On the whole, these minor imperfections in the conduct of the trial cannot turn the decision into something that an ordinary reasonable man on the tram to Shaukiwan would conclude that injustice has resulted or that a fair and proper determination of the claim had not been attained.

34.  The application is thus refused with no order as to costs.