POA KWOK HO v. DIRECTOR OF SOCIAL WELFARE

HCAL 425/2019

[2019] HKCFI 1288

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST NO 425 OF 2019

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D E C I S I O N

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INTROUDCTION

1.  By this application for judicial review made on 14 February 2019, the Applicant seeks to challenge the decision of the Director of Social Welfare (“the Director”) made on 27 November 2018 (“the Decision”) not to process his application for Old Age Living Allowance (“OALA”).

2.  The question which arises for determination is whether the Applicant should be permitted to pursue the present application notwithstanding the fact that the Director had, by a letter dated 14 February 2019, informed the Applicant that his application for OALA had been approved.

BASIC FACTS

3.  For the present purpose, the following brief summary of the background facts shall suffice.

4.  The Applicant was born in Hong Kong on 11 October 1952 and is a Hong Kong permanent resident.  He was married, but divorced in 1985.  He was admitted as a solicitor of the Supreme Court of Hong Kong in 1977, and ceased practice in 1989.  Since early 2017, he has been cohabiting with a female partner.  Upon or immediately after reaching the age of 65, the Applicant, on or about 12 October 2017, applied to the Director for OALA.

5.  The OALA scheme was first launched in April 2013 as an additional form of financial assistance, at $2,200 per month at that time, for elderly Hong Kong residents aged 65 or above who were in need of financial support but who were not able or willing to apply for Comprehensive Social Security Assistance.

6.  Under the Government’s policy for OALA (“the OALA Policy”), eligibility for OALA is subject to, inter alia, satisfaction of certain specified monthly income and assets requirements. Different limits are set for “single person” and “married couple”, with higher limits for both monthly income and assets for the latter group of applicants. In the application form for OALA, an applicant is required to indicate his/her marital status.  There are six boxes or options for the applicant to choose, namely, “Never married”, “Married”, “Divorced”, “Separated”, “Widowed” and “Cohabited”.  The form also provides for the applicant to disclose his/her monthly income and assets and those of his/her “Spouse”.

7.  It is, I understand, the Director’s practice to require an applicant for OALA who is single but who indicates his/her marital status as “Cohabited” to disclose the personal and financial information of the cohabitee, and assess his/her eligibility for OALA by reference to the “married couple” financial limits.  The rationale for this practice is set out in paragraph 32 of the affirmation of Ms Michelle Lam, Assistant Director (Social Security) of the Social Welfare Department (“SWD”), as follows:

“The arrangement to assess ‘Cohabited’ applicants’ financial means against the ‘married couple’ financial limit is intended to be a facilitative measure under which applicants who are not legally married, such as those in traditional marriages and other applicants who are cohabiting (with all required information of the cohabitee provided), could also be assessed against the ‘married couple’ financial limit which is higher than the ‘single person’ financial limit”.

8.  Thus, in the SWD’s web-page for OALA, FAQ 6 states as follows:

“6 Under what circumstances are applicants required to provide information on their spouse’s personal particulars, income and assets?

When an applicant’s marital status is married or cohabiting, the applicant is required to provide his / her spouse’s personal particulars as well as information on his / her spouse’s income and assets, regardless of whether his / her spouse is receiving Normal OALA / Higher OALA.

If the applicant is single, divorced, legally separated or widowed, he / she is only required to provide his / her personal particulars and information on his / her own income and assets.”

9.  At paragraph 33 of her affirmation, Ms Lam points out that:

“Currently, there are about 600 OALA cohabiting recipients receiving the allowance after passing the means test based on the ‘married couple’ financial limit. Some of these recipients would not otherwise be eligible for OALA if the ‘single person’ financial limit is applied on them. In other words, some of these 600 OALA recipients may be worse off if no such facilitative measure were in place”.

10.  At the hearing on 15 May 2019, I was further told by Mr Liu on behalf of the Director that since the practice of treating a single applicant who is in cohabitation with a cohabitee as a “married” person for the purpose of assessing his/her eligibility for OALA is intended to be a “facilitative” measure to cater for those cases where the couple, although not legally married, are sharing their resources and living together as one household, the Director may treat an applicant, who is financially independent of his/her cohabitee and who can provide evidence or verification of financial independence, as a single person and assess his/her eligibility for OALA by reference to the financial limits for “single person”.

11.  In his application form for OALA, the Applicant checked the box for “Cohabited” for his marital status.  In relation to monthly income and assets, he only filled in the column for “Applicant”, but not the column for “Spouse”.  His total monthly income was stated to be $0, and the total value of his assets was stated to be $500.

12.  Thereafter the Director’s staff repeatedly requested the Applicant to provide financial information of his cohabitee.  The Applicant refused to provide the information sought by the Director, or evidence that he was financially independent of his cohabitee.  The matter dragged on for a period of time from around 25 October 2017 to 27 November 2018 when the Director sent a letter to the Applicant, stating as follows:

“2 … in respect of your OALA application, in view that you are living with a cohabitant, we have been asking you to provide information on your cohabitant’s income and assets, or if that is not available, evidence showing that you are financially independent from your cohabitant, in order for us to assess your eligibility for the OALA.

3 Given that the aforesaid requested information has remained outstanding despite our requests, we have not yet made a decision in respect of your OALA application in the meantime.  In order for us to assess your application, please provide the necessary information to the responsible caseworker, Ms PANG Po-yi, at your earliest convenience.  Otherwise, we will be unable to process your application further.”

13.  On 14 February 2019, the Applicant made the present application for leave to apply for judicial review of the Decision, on the ground that the Director has misinterpreted and/or misapplied the OALA Policy in relation to the prescribed financial limits by treating an “unmarried couple” in cohabitation as being the same as a “married couple”, and “cohabitee” as “spouse”.

14.  Also on 14 February 2019, the Director decided to allow the Applicant’s OALA application.  At the time of the making of this decision, the Director was unaware that the Applicant had make the present application for judicial review.  According to Ms Lam, the Director’s reason for allowing the Applicant’s OALA application was as follows –

“Notwithstanding the Applicant’s refusal to provide SWD with the financial information of his ‘cohabitee’ as required, on 14 February 2019, SWD approved the Applicant’s application for OALA based on the ‘single person’ financial limit on an exceptional basis, having regard to the policy objective of OALA is provide financial supplements to elderly persons who are in need with simple and liberal means testing requirement, and the fact that it is not explicitly specified in the OALA application form that ‘Cohabited’ applicants are required to provide personal and financial particulars of their cohabitee for SWD to process their application under the ‘married couple’ financial limit.”[1]

15.  By a letter dated 14 February 2019 (“the Letter”), the Director informed the Applicant that his application for OALA had been approved, and the SWD would pay to his bank account OALA accruing from 11 October 2017 (ie as from the date when the Applicant reached the age of 65).  This letter was in fact printed on 15 February 2019, and delivered to the Morrison Hill Post Office for posting on 18 February 2019.

16.  In the meantime, on 15 February 2019, the Director became aware of the present application for judicial review from the media.  Also on 15 February 2019, the court directed that there should be a rolled-up hearing of the application for leave to apply for judicial review and the substantive application for judicial review.  Notice to that effect was given by the court to the parties by letter dated 18 February 2019.

17.  On 19 February 2019, the Applicant’s solicitors received a copy of the Letter from the Department of Justice, and on 20 February 2019 the Applicant received the Letter by post.

18.  Thereafter the parties engaged in correspondence on whether the Applicant should voluntarily withdraw the application for leave to apply for judicial review on the ground that the application had become academic.  On the one hand, the Applicant pressed the Director to answer or state: (i) whether she agreed that she had misinterpreted the OALA Policy, in particular whether she had erroneously interpreted the meaning of “spouse” to include a cohabitee, and “married couple” to include an unmarried couple, (ii) whether the Director undertook not to apply her erroneous interpretation of the OALA Policy in the future, (iii) what was the basis for her approval of the Applicant’s application for OALA on 14 February 2019, and (iv) whether the Director undertook not to inquire again into the personal and financial particulars of the Applicant’s cohabitee in the future.  On the other hand, the Director considered that since the Applicant’s application for OALA had been approved on 14 February 2019, the Applicant’s application for judicial review had become academic and ought to be withdrawn in the interest of saving costs and time.  The parties were able to agree on the way forward, and the matter was brought to the court’s attention.  On 13 March 2019, the court informed the parties that it did not intend to deal with this matter by correspondence, but either party would be at liberty to fix a 30-minute hearing for further consideration of how these proceedings may be disposed of in the absence of agreement.  The present hearing was subsequently fixed by Applicant.

19.  As can be seen from Mr Hectar Pun, SC’s Note of Submission dated 8 May 2019, at paragraph 3, the Applicant’s position is as follows:

(1)   if the Director is prepared to inform the Applicant of her interpretation of the OALA policy and to accept that her interpretation is incorrect, the court is invited to give directions that the Applicant do discontinue the application for judicial review in accordance with the procedure in paragraph 23(1) of Practice Directions SL-3;

(2)   alternatively, if the Director still refuses to inform the Applicant of her interpretation of the OALA Policy and accept that her interpretation is incorrect, the court should exercise its discretion to deal with the application, and give directions for the further conduct of the application.

20.  On the other hand, the Director’s position is that this application for judicial review has become academic, and thus leave to apply for judicial review should be refused[2].

21.  The parties are agreed that the court should determine the question of whether leave to apply for judicial review should be refused by reason of the fact that the present application has become academic, notwithstanding the court’s previous direction that there should be a rolled-up hearing of the application for leave to apply for judicial review and the substantive application for judicial review.

DISCUSSION

22.  It is clear that the present application has been rendered “academic” by the Director’s decision to approve the Applicant’s application for OALA on 14 February 2019.  The Applicant has now effectively obtained all the substantive relief sought by him in the Form 86, in particular, (i) an order of certiorari to bring up and quash the Decision, and (ii) a declaration that the Applicant is entitled to OALA since 12 October 2017.  There is no question of the Applicant being entitled to claim any further “damages” from the Director.

23.  Guidance on the approach that the court should adopt in the exercise of its discretion whether to hear and determine an application for judicial review which is or has become “academic” can be found in the judgment of the Court of Appeal in Chit Fai Motors Co Ltd v Commissioner for Transport [2004] 1 HKC 465, at paragraph 20 per Ma CJHC (as he then was, with whom the other two members of the Court of Appeal agreed):-

“Where it is contended, as the Commissioner has maintained in the present appeal, that the question before the court is academic or hypothetical, the following factors will feature in the court’s approach (they are by no means exhaustive since this question can arise in a number of different contexts):-

(1) Where a question is purely hypothetical or academic in the sense that there are simply no events that have occurred that form the basis for the question to be answered, a court will not entertain it. However relevant or even important the question may be, the court will not give an advisory opinion on hypothetical facts. There are principally two reasons for this: first, the court’s function is to adjudicate on real disputes, not imaginary ones and secondly, to decide on points of law or principle when there are no facts before the court is not only undesirable, it can have unfortunate or even dangerous consequences. In this situation, the court will not have any jurisdiction to determine the question.

(2) Sometimes, however, and the present case is one, the question before the court is said to be hypothetical or academic only because the real dispute that drove the parties to litigation (sometimes called the lis) happens no longer to be in existence at the time of the hearing, even though the relevant facts giving rise to the dispute were real and had actually taken place…

(3) In the type of situation referred to in the previous paragraph, the court does have jurisdiction to hear and determine the question in issue. However, in deciding whether or not to do so (and this can be said to be a matter of discretion), the court will closely examine the relevance or utility of any decision. In the public law sphere, this may be easier to demonstrate than in relation to private rights. This is because very often in public or administrative law cases, the duties of public bodies fall to be exercised on a continuing basis not only in relation to the parties before the court but also perhaps to others in the future. In R v Secretary of State for the Home Department, ex parte Salem [1999] 1 AC 450, the House of Lords reviewed the relevant authorities and stated that the court had a discretion whether or not to determine the question before it even though there was no longer a lis:- see 456 G-H. However, the discretion was to be exercised with caution and the court should only do so where there was good reason in the public interest. At 457 A-B, Lord Slynn of Hadley said this:

‘The discretion to hear disputes, even in the area of public law, must, however, be exercised with caution and appeals which are academic between the parties should not be heard unless there is a good reason in the public interest for doing so, as for example (but only by way of example) when a discrete point of statutory construction arises which does not involve detailed consideration of facts and where a large number of similar cases exist or are anticipated so that the issue will most likely need to be resolved in the near future.’

To Lord Slynn's words, I would add this. Where the same point is likely or may well arise as between the same parties, this is, if anything, an a fortiori situation for the court to proceed to determine the question in controversy. In Eastham v Newcastle United Football Club Ltd [1964] Ch 413 (in many respects a public law case although it appears to have been a private litigation), Wilberforce J determined a question involving the use of restraint of trade clauses in the English Football League, even though the player in question (the famous player, George Eastham) had already moved from his former club Newcastle United (whom he sued) to Arsenal. The footballer's complaint against the transfer system was one that was likely to arise again, if not to him, then in relation to other players. A similar situation arose in R v Canons Park Mental Health Review Tribunal, ex parte A [1995] QB 60, where the Court of Appeal held that the issue there should be determined even though the lis had disappeared since there was a real possibility that the same issue could arise again in relation to the applicant in that case:- see 68 B-F.

(4) In other public law contexts, the court may consider determining issues where, for example, there are conflicting decisions…”

24.  It is not in dispute that the present case does not fall within the type of cases referred to in paragraph 20(1) of the judgment of the Court of Appeal in Chit Fai Motors Co Ltd, but should properly be regarded as falling under paragraph 20(2) of that judgment.  That being the position, the court has a discretion whether to hear and determine the application for judicial review, but such discretion ought to be exercised cautiously, and the court should only do so where there is/are good reason(s) in the public interest.  An important, but not conclusive, consideration is whether there is any practical relevance or utility of making a decision in the application.

25.  I do not consider that the court should exercise its discretion to hear and determine the present application for judicial review, for the following reasons.

26.  First, it is clear that a decision on the proper interpretation of the OALA Policy is of no real relevance or utility to the Applicant up to at least 2022-2023.  Ms Lam has confirmed in her affirmation that the Director will not inquire into the personal and financial particulars of the Applicant’s cohabitee until the regular review of his entitlement (applicable to all OALA recipients) which will only take place in 2022-2023.

27.  Second, while I accept that the proper interpretation of the OALA policy, in particular the meaning of “spouse” and “married couple”, may be of general application and relevant to other elderly persons in a situation similar to that of the Applicant, the Director’s evidence is that the present case is the only application for judicial review relating to OALA.  It would appear, therefore, that there is currently no other case which would benefit from the court’s decision in this application.

28.  Third, in so far as possible future applications are concerned, the Director’s evidence is that an “improvement” to the OALA application materials will be made in June 2019 (“the Proposal”) such that it will be made clear to an applicant who is in cohabitation with a cohabitee that he/she should only check the box “Cohabited” if he/she (i) is currently living with the cohabitee in the same household, (ii) is living on share resources with the cohabitee, and (iii) agrees[3] to provide the personal and financial information of the cohabitee to the Director for the purpose of assessing his/her eligibility for OALA based on the “married couple” financial limits.  Otherwise, the applicant should, or would be allowed to, check other options in the application form as may be appropriate to his/her situation such as “Never Married” or “Divorced”, and his/her application will be assessed based on the “single person” financial limits[4].  The effect of the Proposal will be that a person in the position of the Applicant will no longer be required to provide the personal and financial information of his/her cohabitee when applying for OALA if he/she does not wish to do so, and will be assessed for eligibility for OALA based on the “single person” financial limits.  Mr Pun argues that the Director has no power to amend the OALA Policy, because that policy was formulated by the Chief Executive in Council.  That may be so, but it has not been shown that the Proposal is inconsistent with the existing OALA Policy.  In any event, it is difficult to see how the Applicant or a person in his position can legitimately complain about the Proposal which in fact operates to their benefit.

29.  Fourth, as emphasized by the court on a number of occasions recently, having regard to the huge increase in the number of applications for judicial review filed in the High Court in the past few years, the court must now carefully manage and deploy its limited resources to ensure that all applications are fairly, economically and expeditiously dealt with[5].  Also, it is relevant that the Applicant is legally aided in the present case, which means that the costs of the proceedings on both sides will ultimately be borne by the general public.  These considerations would tend to argue against allowing the present application for judicial review to go ahead if it can be avoided.

30.  Lastly, this is not a case where the Director made the decision to approve the Applicant’s application for OALA in order to frustrate the application for judicial review.  I see no reason to doubt the matters set out in paragraphs 11 to 20 of Ms Lam’s affirmation, and believe that it was a mere coincidence that the Applicant made the application for leave to apply for judicial review and the Director made the decision to approve the Applicant’s application for OALA on the same date.

31.  In passing, I should mention that Mr Liu has not submitted that the application for leave to apply for judicial review should be refused because the substantive application has no merits.  Having considered the materials before me (necessarily limited at this stage), my provisional view is that the application is reasonably arguable, but it is not such a strong case that it can be said will more likely than not succeed.  I do not consider the merits of the application to tilt the balance in the court’s exercise of its discretion whether to hear and determine the application for judicial review either way.

OTHER MATTERS

32.  There are a few other matters that I should briefly deal with before concluding.  First, the Applicant complains that the Director failed or refused to explain the basis of her decision to allow the Applicant’s application for OALA prior to the filing of the affirmation of Ms Lam on 10 May 2019.  The Director’s position was that since the Applicant’s application for OALA had been allowed, the application for judicial review had become academic and should simply be withdrawn without further costs and time being wasted.  In view of the fact that the Director has now explained the basis of the decision in paragraph 35 of Ms Lam’s affirmation, the question of whether the Director ought to have done so earlier does not, in my view, has any bearing on whether the court should exercise its discretion to hear and determine the present application for judicial review.

33.  Second, the Applicant says that he requires the Director to acknowledge that she has misinterpreted the OALA Policy and undertake not to apply her erroneous interpretation of the OALA Policy in future, or alternatively give an explanation of the basis for approving his application for OALA because “under the OALA Scheme, if [he] withholds any information for the purpose of obtaining payments, he will be liable to prosecution.  It is thus important for [him] to know whether he is under an obligation to disclose his cohabitee’s financial information at the moment and/or in the future.  It is especially so when the financial position of [his] cohabitee may change in the future”[6]. In my view, the suggestion that the Applicant may be at risk of prosecution for withholding information relating to the financial position of his cohabitee for the purpose of obtaining payments, or is under an obligation to disclose his cohabitee’s financial information “at the moment”, is fanciful.  The Applicant has steadfastly refused to provide to the Director information relating to the financial position of his cohabitee, and the Director has nonetheless decided to approve his application for OALA on 14 February 2019.  In such circumstances, I fail to see how he may be prosecuted for withholding information for the purpose of obtaining payment under the OALA scheme or is under an obligation to disclose his cohabitee’s financial information at the moment. As to what may happen in the future, it is of course possible for some relevant change of circumstances to occur, but that is not something which one can speculate at this stage.

34.  Third, the Applicant says that the timing of the Director’s decision to approve his application for OALA was “rather suspicious”, and suggests that “the Director’s sudden change of position was an attempt to render [his] judicial review application ‘academic’”[7].  I see no reason to doubt the chronology of events referred to in paragraphs 11 to 20 of Ms Lam’s affirmation, and I reject the allegation that the Director’s decision to approve the Applicant’s application on 14 February 2019 was an attempt to render the present application for judicial review academic.

35.  Fourth, the Director complains that the Applicant failed to inform the court of a material change of circumstances, namely, that his application for OALA had been approved, after he had become aware of the same, in breach of the duty of full and frank disclosure.  As a matter of principle, an applicant who has made an ex parte application for leave to apply for judicial review is under a continuing duty to disclose to the court any material change of circumstances which has occurred since the making of the application.  The fact that the application has become academic is plainly a relevant matter which ought to be disclosed to the court as soon as the applicant becomes aware of the same.  The fact that the court has given a direction that the application should be dealt with on a rolled-up basis makes no difference, because such direction may need to be reviewed as a result of the application becoming an academic one.  In the present case, the Applicant became aware of the fact that his application for OALA had been approved on 19 February 2019, or on 20 February 2019 at the latest, and the duty to make the relevant disclosure arose at that stage.  On the facts of the present case, I am prepared to accept his explanation that he was at that time engaged in trying to agree with the Director on the directions for the further conduct of these proceedings (to be submitted to the court in accordance with the court’s previous direction dated 15 February 2019), and he intended to make the relevant disclosure at the time when he submitted the agreed directions to the court or informed the court that directions could not be agreed with the Director.  While I consider that the Applicant ought to have disclosed to the court the fact that his application for OALA had been approval as soon as he became aware of that matter, in all the circumstances, I do not consider that any further action is required to be taken on this complaint.

36.  Fifth, the Applicant’s position that he would only be prepared to discontinue the application for judicial review if the Director agrees to inform him of her interpretation of the OALA Policy and accepts that her interpretation is incorrect is, in my view, unnecessarily confrontational as well as inappropriate.  The true or proper interpretation of the OALA Policy is a matter of law to be determined by the court should there be a genuine and on-going dispute between the parties which requires its determination.  It is not a matter to be “accepted” by either party.  It is also open to reasonable debate whether any “acceptance” by the Director that her interpretation is incorrect, or some other interpretation is correct, is binding on her vis-à-vis the Applicant and/or other applicants, and whether she may retract from such “acceptance” if, for example, she receives legal advice in future pointing to a different conclusion.

DISPOSITION

37.  For the foregoing reasons, the application for leave to apply for judicial review is dismissed.  The parties are agreed that in such a scenario, there should be no order as to the costs of the whole proceedings, including the costs of the hearing on 15 May 2019.  I so order.  Lastly, the Applicant’s own costs are to be taxed in accordance with legal aid regulations.