SALLEH ABU BAKER v. ANWAY LTD

CACV 568/2021

[2023] HKCA 187

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 568 OF 2021

(ON APPEAL FROM HCA NO 2359 OF 2019)

________________________

________________________

________________________

REASONS FOR JUDGMENT

________________________

Hon G Lam JA (giving the Reasons for Judgment of the Court):

1.  This is the plaintiff’s appeal against the judgment of Recorder William Wong SC (“judge”)  dismissing his action (“Judgment”).[1] The plaintiff claimed that his employer, the defendant, was not entitled to give only 3 months’ notice, as it did, to terminate his employment, because the provision for termination by 3 months’ notice in the written agreement had been varied by an oral agreement, or alternatively the defendant was estopped from relying on that provision. The judge, after trial, held that there was no such oral agreement between the parties or promise by the defendant, and that the plaintiff’s claim should therefore be dismissed. The issue in this appeal is whether the judge’s findings of fact may be impugned. At the end of the hearing, we dismissed the appeal with costs, for reasons to be given in writing. These are our reasons.

Background

2.  The plaintiff was born in 1947 and had worked in DFS Ltd since 1970.  In October 2000, he was recruited to be the CEO of Sky Connection Ltd (“Sky Connection”), then a joint venture between the New World group and the Lai Sun group running a duty free concession at the Hong Kong International Airport.  That employment agreement, which was in writing, was for a term of 20.5 months to 5 July 2002, renewable by Sky Connection by giving 6 months’ notice.

3.  Although no written notice to renew was given, the plaintiff’s employment with Sky Connection continued after July 2002, apparently on a month to month basis.  By November 2003, the duty free business environment in Hong Kong had stabilised after SARS and Sky Connection had secured a 2-year extension of its concession at the airport.  The New World group had also acquired the 50% stake in Sky Connection from the Lai Sun group, though the latter retained rights to participate in the profits and to have representatives on the board of Sky Connection until 2008.

4.  By a letter dated 14 November 2003, the plaintiff was offered continued employment as CEO of Sky Connection with effect from 1 December 2003 with no fixed term.  The plaintiff accepted it by countersigning on 24 November 2003.  Although the letter referred to the previous employment agreement being extended, it is common ground that the plaintiff became employed on the terms and conditions in the letter (“employment agreement”)  rather than in the contract of October 2000.

5.  The plaintiff’s immediate supervisor was Patrick Lam, who was a director of Sky Connection as well as a director of NWS Holdings Ltd, the listed holding company in the New World group.  Another director of Sky Connection responsible for the management of the duty-free business unit within the New World group was Andrew Wong.  Apart from them, there were 4 other directors on the board of Sky Connection in 2004, two from the New World group and two from the Lai Sun group.

6.  Two provisions of the employment agreement are of particular relevance in this case, namely, clause 6, which provides as follows:

“ 6. TERMINATION OF SERVICE

Either party may terminate employment under this agreement by giving three (3)  months’ notice in writing or three (3)  months’ salary in lieu of notice.

However, the Company will also reserve its legally permissible right to terminate employment at any time without notice or payment in lieu of notice if you are guilty of any act of dishonesty or serious misconduct or negligence of duty.

  Interpretation of the terms hereinbefore contained shall be in accordance with the provisions of the relevant sections of the Employment Ordinance.”

and clause 12, which provides as follows:

“ 12. NON-COMPETE UNDERTAKING

You will not for a period of thirty six (36)  months from the date of termination of employment under this Agreement either solely or jointly with or as an employee, servant or agent of or for any other person, firm or corporation directly or indirectly:

(a)  Employ any person who at the time of termination of your employment or at any time within eighteen (18)  months previously was an employee of any member of the Company;

(b)  Solicit business for yourself or any person, firm or corporation other than the company from any customer of the Company or an Associated Company any time during the thirty six (36)  months of your employment.”

We shall refer to the first part of clause 6 concerning the notice period as the “3 months’ notice clause” and to clause 12 as the “non-compete clause”.

7.  According to the plaintiff, on seeing the letter, he noted with concern that it contained a 36-month non-compete clause whereas the comparable clause in the previous contract was for 1 year only.  Nevertheless he signed it, happy to have gainful employment.  In October 2004, however, he took the opportunity during a business trip to Cannes to raise his concern with Patrick Lam that whilst he was subject to a 36-month non-compete clause and therefore severely restricted from seeking comparable employment for 3 years, the employer was only required to give him 3 months’ notice to terminate the employment.  Patrick Lam, who seemed sympathetic, asked if the plaintiff had any suggestion.  The plaintiff told Patrick Lam that if there was a 24-month termination notice period to balance against the 36-month non-compete clause, he would consider it reasonable.  Patrick Lam said he understood and that he did not think 24 months was a problem.  He assured the plaintiff that “到時如果咁做嘅話，一定會畀夠你嘅”,which the plaintiff understood to mean “if it comes a time when the Company wants to let you go, we will definitely pay you enough”.

8.  The plaintiff said that subsequently there were two other relevant meetings in Hong Kong.  First, in mid-November 2004, the plaintiff followed up with Patrick Lam on their Cannes discussion and asked if the plaintiff could look forward to a new written contract of employment. Patrick Lam said that the plaintiff should rest assured and trust him and that Sky Connection would certainly not want to let the plaintiff go upon him giving just 3 months’ notice.  The plaintiff understood that Patrick Lam might want to be flexible and not commit to any particular length of notice as reasonable.

9.  The next meeting was in mid-December 2004, when the plaintiff broached the subject of termination notice during a discussion on bonuses and salaries of management and staff.  The plaintiff suggested to Patrick Lam that a written fixed-term employment contract would be useful to the plaintiff in case Patrick Lam was promoted.  Patrick Lam told the plaintiff there was no room for him to be promoted, that a written contract was a formality, and that New World was a traditional Chinese company that valued trust and honour, where verbal commitments were as good as gold.

10.  According to the plaintiff, he considered that Patrick Lam had, by these conversations, agreed on behalf of Sky Connection to dispense with the provision for 3 months’ notice and agreed, expressly or impliedly, that either party could thereafter terminate the employment by giving notice of a reasonable period or making equivalent payment in lieu of notice.  The plaintiff treated the matter as settled and never raised it again.

11.  The defendant was another company within the New World group that carried on duty-free business.  For tax reasons (because the defendant was the more profitable company), the plaintiff’s employment was transferred from Sky Connection to the defendant with effect from 1 April 2013 with all terms and conditions remaining unchanged.

12.  In January 2016, Patrick Lam left the duty-free business unit at the New World group and also turned non-executive on the board of NWS Holdings Ltd.  The plaintiff continued to work as the CEO of the duty-free business, which had been profitable until 2018.  At around this time, a new senior management team was put in place in NWS Holdings Ltd.  Differences in strategies and styles emerged between the plaintiff and his new immediate supervisor, Gilbert Ho.  Eventually, the plaintiff was summoned to a meeting with Gilbert Ho and Eric Ma, the CEO of NWS Holdings Ltd, on 10 May 2019, and offered either a “voluntary early retirement package” comprising 3 months’ pay in lieu of notice and an additional 3 months’ pay for “garden leave”, or termination on 3 months’ pay in lieu of notice.  The plaintiff told Eric Ma that the 3-month notice clause in the employment agreement was obsolete and not applicable and that Patrick Lam had orally promised him more.  The plaintiff did not accept the early retirement package, and his employment was therefore terminated on 10 May 2019 by 3 months’ pay in lieu of notice which was deposited into his bank account together with other emoluments due to him.

13.  On 14 May 2019, the plaintiff wrote a long letter to Eric Ma which stated, among other things, that the provision in the employment agreement on 3 months’ notice was “long outdated”; that one year or so after the employment agreement, he had expressed his concern to Patrick Lam that 3 months’ notice of termination was far too short and made known his view that a reasonable notice of termination either way ought to be between 18 and 24 months; that Patrick Lam acknowledged to him the 3 months’ notice provided in the employment agreement “could not possibly work”; that Patrick Lam did not say what he thought would be a reasonable length of notice but assured the plaintiff to the effect that (a)  the New World group was run by a traditional Chinese family known to be honourable, fair and righteous towards loyal staff especially someone like the plaintiff who had successfully turned the company (Sky Connection)  around, and (b)  if the company wanted to terminate his service, it would definitely give him enough (“一定會畀夠你嘅”). The plaintiff concluded by stating that he felt entitled to far more than what had been offered, and asked Eric Ma to consider the information provided so that they could part amicably on terms that were fair and reasonable to the plaintiff.

14.  On 21 May 2019, Eric Ma replied to the plaintiff, stating that as shown in the company’s records, the employment agreement dated 14 November 2003 was still in full force and effect and had not been superseded by any new contract.

15.  Dissatisfied with this reply, the plaintiff brought a claim in the Labour Tribunal on 16 July 2019 claiming 21 months’ wages.  After the filing of witness statements, the case was transferred by the Tribunal, on the defendant’s application, to the Court of First Instance by order dated 3 December 2019.

The parties’ cases below

16.  The plaintiff contended that the employment agreement was orally varied in October 2004 or at the latest by December 2004, by what was said between Patrick Lam and him in their meetings referred to above, such that the provision for termination by giving 3 months’ notice was dispensed with, and that, as an express or implied term, either party would from then on be entitled to terminate the employment by giving notice of a reasonable period or making payment in lieu of such notice.  Alternatively, the plaintiff contended the defendant was estopped (by representation and/or convention)  from denying that the employment agreement had been so varied and from relying on the 3 months’ notice provision in the employment agreement.

17.  Accordingly, the plaintiff contended that the defendant had acted in breach of the employment agreement as varied by purporting to terminate it by giving 3 months’ wages in lieu of notice.  The plaintiff was entitled to reasonable notice, which he contended to be 24 months or such other period as the court found to be reasonable.  He therefore claimed 21 months’ wages, or a sum representing the balance of wages in lieu of a period of notice which the court found reasonable, after giving credit for the 3 months’ wages received.

18.  The defendant denied that there was any oral agreement or promise by Patrick Lam to the effect that the notice period would be extended from 3 months to a longer period.  It contended that even if Patrick Lam had given the alleged assurance, it was equivocal and vague and not capable of forming a contract and was not given with any intention to create legal relations; that the alleged oral variation was void for uncertainty; and that Patrick Lam had no authority, whether actual or apparent, to vary the notice period in the employment agreement.

The judge’s decision

19.  The judge heard the oral testimony of the plaintiff and Patrick Lam at trial (in addition to Elina Lam, the Human Resources Director at NWS Holdings Ltd).  In his Judgment, he concluded that the parties did not form any oral agreement to vary the 3 months’ notice clause.  He set out 8 reasons which may be summarised as follows:

(1)  Taking the plaintiff’s own evidence at its highest, there were discussions about the 3 months’ notice period, and the period of 24 months was suggested, but the plaintiff did not reach any concluded agreement with Patrick Lam in Cannes in October 2004.[2]

(2)  The plaintiff accepted in cross-examination that throughout their three discussions, Patrick Lam did not specifically agree or promise that the 3 months’ notice clause should be cancelled or superseded or that the plaintiff’s employment could only be terminated with 24 months’ notice.[3]

(3)  The plaintiff’s letter dated 14 May 2019 was against his own case because (i)  it indicated that at no point in time had Patrick Lam agreed to a variation of the 3 months’ notice clause; (ii)  it did not record that Patrick Lam had said that 24 months’ notice was not a problem; and (iii)  it recorded the plaintiff as having said to Patrick Lam that a reasonable notice period ought to be “between 18 to 24 months” (sic), which was discrepant with his pleading and witness statement which simply referred to “24 months” as a reasonable period of notice.[4]

(4)  A 24 months’ notice period does not make any common or commercial sense.  Nor would the plaintiff and Patrick Lam, being seasoned business executives, have agreed on an undefined “reasonable” period of notice.  Patrick Lam would not have made a hasty decision without consulting other directors of the company.  Clause 12 of the employment agreement would not prevent the plaintiff from joining a company with a pre-existing franchise, or a new franchisee at the Airport, or overseas duty-free operations.  If the plaintiff was concerned with the non-compete period, he would have sought to reduce that period, not to increase the length of termination notice.[5]

(5)  The alleged agreement to vary the notice period was not evidenced by any document or electronic footprint.[6]

(6)  The plaintiff’s own evidence in relation to the two discussions in 2004 that took place in Hong Kong was that Patrick Lam did not want to commit to any particular length of notice as reasonable.  Absent any intention to commit, the plaintiff could not have thought that Patrick Lam intended to enter into a binding legal relationship.[7]

(7)  The plaintiff had not adduced industry evidence as to what would be a reasonable period, or the basis for an 18 to 24 months’ notice period.  When the plaintiff worked with DFS Taiwan, the notice period was 3 to 6 months.  The court could not properly decide on what a reasonable notice period would be without any evidential basis.[8]

(8)  Patrick Lam was a straightforward witness and his evidence was credible, despite that his evidence was more detailed compared to his witness statement filed in the Labour Tribunal.  He could not have made the alleged decision without consulting his fellow directors or informing the Human Resources Department.[9]

20.  As for the plaintiff’s reliance on his letter to Eric Ma dated 14 May 2019, the judge said that the letter did not state there was any oral agreement, and indeed pointed in the opposite direction. The judge did not think that Eric Ma must necessarily have consulted Patrick Lam, and could have simply consulted the employment agreement and the Human Resources Department, before issuing his short reply to the plaintiff.[10]

21.  Having rejected the plaintiff’s case of a variation of the employment agreement on the facts, the judge did not find it necessary to deal with the issues of apparent authority and estoppel.[11]

The appeal

22.  On this appeal, Mr Ian Chau advanced many arguments on behalf of the plaintiff to attack the judge’s conclusion, which may be grouped together and summarised as follows:

(1)  The judge misunderstood the plaintiff’s case. The plaintiff’s case was that an oral agreement was reached dispensing with the 3 months’ notice clause, and that even though there was no agreement on a 24-month notice period instead, a term was implied requiring notice of a reasonable period.  The judge erroneously thought that, as there was no agreement on the required length of notice, there could be no binding agreement to vary the employment agreement and that this was the end of the analysis.

(2)  The judge failed to consider the points relating to the meeting on 10 May 2019 and the plaintiff’s letter of 14 May 2019 that supported the plaintiff’s case, whilst placing unreasonable weight on peripheral inconsistencies relating to that letter.

(3)  The judge wrongly focused on the precise legal effect of the non-compete clause, when the point was whether the plaintiff genuinely believed that that clause was grossly unfair to him when the employer could dismiss him with 3 months’ notice.  Even where the plaintiff joined a company with a pre-existing franchise, or a new franchisee at the Airport, or overseas duty-free operations, there were ample grounds for the plaintiff genuinely to believe that the clause could expose him to serious legal consequences.

(4)  The judge erred in assessing Patrick Lam’s evidence and in not taking into account against his credibility the difference between his evidence at trial and his witness statement in the Labour Tribunal.  The judge also failed to take into account that Patrick Lam’s oral evidence on whether Eric Ma had approached him before responding to the plaintiff in May 2019 was evasive and inconsistent.

(5)  The judge failed to take into account crucial factors regarding the inherent probabilities, as summarized in §45 below.

23.  Alternatively, Mr Chau submitted the judge should have held that there was an estoppel, the convention or representation being that the 3 months’ notice period would be replaced by reasonable notice.

24.  It was in addition submitted that the judge ought to have found that Patrick Lam had apparent authority to make the promises or representations in question on behalf of Sky Connection.

25.  Mr Chau submitted that the judge also erred in law in holding that in the absence of industry evidence, there was no evidential basis for determining what a reasonable period of notice should be, and was wrong to rely on the notice period of 3 to 6 months when the plaintiff was in DFS Taiwan.  The judge ought to have found that a reasonable period of notice for terminating the plaintiff’s employment on 10 May 2019 was in the region of 24 months.

26.  On behalf of the defendant, Mr Alan Kwong, appearing with Mr Jiang Zixin, defended the Judgment based on the judge’s reasoning.  The defendant had also filed a respondent’s notice contending that even if Patrick Lam had made the alleged promise to the plaintiff, he did not have actual or apparent authority to do so on behalf of Sky Connection.

Discussion

The applicable approach

27.  It is common ground that the principal attack on the judge’s conclusion involves a challenge against his findings of primary fact, and that the plaintiff has to pass a high hurdle in order to justify appellate interference with such findings.  Before this court can intervene, it has to be able to conclude that, despite the fact that it does not enjoy the advantages available to the judge who received the evidence at first-hand, it is nevertheless satisfied that his conclusion on the facts is plainly wrong: Ting Kwok Keung v Tam Dick Yuen & others (2002)  5 HKCFAR 336, §42.  The starting point is for the appellant to identify palpable errors in the judgment below sufficiently material to warrant intervention by this court.  An appeal is not a forum for repeating all the submissions on the evidence made below, as if it were a re-trial, in the hope that the appellate judges may come to a different view of the facts from that of the judge: China Gold Finance Ltd v CIL Holdings Ltd (CACV 11/2015, 27 November 2015), §§15-16.

28.  While this Court may interfere with a finding for which there was no evidence in support, or which was based on a misunderstanding of the evidence, or which no reasonable judge could have reached, it must be borne in mind that the trial court is the primary tribunal for the assessment of the evidence and making relevant findings of fact.  As Kwan VP observed in Shine Grace Investment Ltd v Citibank NA & another [2022] HKCA 1341 at §60(2):

“ It is the trial judge who has the primary role in assessing evidence and making relevant findings of fact, not the appeal court. The trial before the primary judge should be the ‘main event’, not a ‘tryout on the road’. The appeal court should defer to the trial judge’s conclusion even if in some doubt as to its correctness, because it is unlikely to gain as much insight to the facts from seeing how the evidence unfolded, or be as familiar with the evidence as the primary judge, who has lived with the trial from beginning to end. Besides, the perception of the appeal court may be narrowed or distorted by selective readings of the transcript when the focus is on the challenge of a particular finding.”

Misunderstanding the plaintiff’s case

29.  In the first ground raised, Mr Chau submitted that the judge thought that because on the plaintiff’s own case there was no concluded agreement on the length of requisite notice, that should be the end of the analysis.  He submitted that the judge misunderstood the plaintiff’s case which was that there was an agreement that the 3 months’ notice clause be dispensed with, and that in substitution there was an implied term requiring reasonable notice.

30.  We do not accept this submission.  It is clear from the Judgment that the judge well understood what the plaintiff’s case was in this respect: see §§2, 5, 33, 34.  In the passages under attack, what the judge stated was as follows:

“ 17. First and foremost, in paragraph 34 of the Plaintiff’s own witness statement, he said:

‘… I accept that whilst Patrick said he did not think 24 months was a problem, he did not unequivocally confirm that the 3-Month Notice Clause was substituted by a 24-month notice, I took his comment to mean that a 24-month notice could well be reasonable but did not commit Sky Connection to it at that point.’ (emphasis added.)

18. Hence, it is clear to this Court that putting the Plaintiff’s case to its highest, there were some sort of discussion about the 3 months’ notice period clause and the period of 24 months were suggested in the course of such discussion. However, there was no concluded agreement on that occasion.

  19.  Given that there was no commitment from Sky Connection and the Plaintiff knew about it, that really should be the end of the analysis.”

31.  When the judge said there was no commitment from Sky Connection, he was clearly referring to the fact that on the plaintiff’s own evidence, there was no concluded agreement on that occasion for the 3 months’ notice clause to be substituted by some other period.  On that basis, it was not surprising that the judge said that should really be the end of the analysis, having regard to his view[12] that Patrick Lam and the plaintiff would not simply have agreed on an undefined “reasonable” period, which was “impractical” and a “recipe for litigation”.

32.  The plaintiff’s case, essentially, was that from their discussions the parties should be taken to have intended to dispense with the 3 months’ notice without substituting an alternative notice period, leaving the matter at large.  The judge was fully entitled to take into consideration the inherent improbability of two senior and experienced executives coming to a binding agreement simply to remove the stipulated notice period without fixing another one.  Although the judge said that should be the end of the analysis, in fact he did not stop there, but went on to deal with the other arguments raised. 

33.  In our view this ground was not made out.

The 10 May 2019 meeting and 14 May 2019 letter

34.  Mr Chau referred to the fact that at the meeting with Eric Ma and Gilbert Ho on 10 May 2019, the plaintiff made an immediate complaint that the 3-month notice clause was obsolete and not applicable and that Patrick Lam had promised him more, and set out his case more fully soon afterwards in his letter of 14 May 2019.  It was submitted that it was unlikely the plaintiff would lie in such contemporaneous and spontaneous response, and that the judge failed to consider the parts of the letter that corroborated the plaintiff’s case but placed unreasonable weight on peripheral inconsistencies.

35.  First of all, it has to be pointed out that the meeting took place and letter was composed almost 15 years after the conversations in 2004, which had no earlier written record whatsoever.  While his complaints in the meeting and letter might suggest that the plaintiff genuinely believed in May 2019 that he had been promised more, they could hardly be regarded as accurate and reliable records of what was said in 2004.  On our reading of the Judgment, the judge did not find that the plaintiff was untruthful in the sense of giving evidence that he did not believe to be true, but the question remained how credible and reliable his evidence was.

36.  The judge was entitled to take the view that discrepancies between the letter and the plaintiff’s evidence cast doubt on the reliability of his evidence.  Mr Chau characterized the differences as “peripheral inconsistencies” but we do not think the judge’s view could be said to be plainly wrong.  In particular, we likewise consider it significant that the letter did not mention that Patrick Lam had indicated that “he did not think 24 months’ notice would be a problem”, which was an important allegation expressly pleaded in the statement of claim.  Further, the letter said that the plaintiff told Patrick Lam a reasonable notice period ought to be “18 to 24 months”, but the plaintiff’s pleading and witness statement stated that the plaintiff told Patrick Lam that he considered “24 months” a reasonable notice period without mentioning the range of 18 to 24 months or any other range.

37.  As to the points in the letter said to be corroborative of the plaintiff’s case, they might be indicative of the plaintiff’s state of mind and recollection in 2019, but as explained above they were hardly reliable evidence of what took place in 2004.  In any event, the statement in the letter that the employment letter of 14 November 2003 was “long outdated” and that HR had not been kept informed of the “discussions … with Patrick Lam” merely shows that there were discussions and that the plaintiff believed that the 3 months’ notice clause would not be applied.  They fell far short of showing there was a legally binding agreement reached in that regard.  The reference in the letter to Patrick Lam having “acknowledged … that the 3-month notice of termination provided in the 2003 letter could not possibly work” was only a paraphrase.  As the plaintiff’s witness statement made clear, Patrick Lam actually said that it would be hard for Sky Connection to replace the plaintiff if he was to leave by giving 3 months’ notice, which the plaintiff took to mean Patrick Lam would not agree to let the plaintiff go by giving 3 months’ notice.  Again, this is far from a legally binding agreement or promise that Sky Connection would not terminate the plaintiff’s employment pursuant to the express provision in the employment agreement.  The reference to an assurance that if the company wanted to terminate the plaintiff’s service, it “would definitely give him enough”, even if actually said by Patrick Lam, was so vague as to be of little value in finding an agreement.

38.  This ground therefore also failed.

The non-compete clause

39.  Mr Chau submitted that the judge should not have examined the precise legal effect of the non-compete clause (clause 12 of the employment agreement)  because the issue was whether the plaintiff, as a lay person, genuinely believed that the 36-month restriction was grossly unfair in comparison to the 3-month notice period for termination.  Mr Chau also submitted that the plaintiff had legitimate concerns that the non-compete clause could have a severe adverse impact on his prospects of securing comparable employment elsewhere. 

40.  In our view, this ground does not assist the plaintiff.  The plaintiff’s concern about the non-compete clause went to his motives in raising the issue about the length of termination notice.  The plaintiff’s case essentially was that he felt the 3-month notice period was unfairly disproportionate to the 36-month restriction post-termination.  But the judge did not reject the plaintiff’s case that he was concerned about the 3-month notice period; nor did the judge altogether reject the plaintiff’s evidence that he had discussed it with Patrick Lam.  At §22 of the Judgment, the judge said:

“ … It appears that the truth is that the Plaintiff was genuinely concerned about the 3 months’ notice period clause and he did make known his view on what should be the reasonable period of notice for termination, but Mr Patrick Lam did not get back to him.”

41.  Whether the practical restrictive effect of the non-compete clause was more severe than found by the judge was not to the point.  What was important was the exchanges between the two men, and in particular whether Patrick Lam actually agreed or promised that the 3 months’ notice clause was to be treated as no longer applicable, even though on the plaintiff’s own case no substitute notice period had been agreed.  The precise extent to which the plaintiff might be affected in practice by the non-compete clause was not material to that question.  Mr Chau’s submissions in that regard could not show that the judge’s findings about the discussions between the two men were plainly wrong.

Patrick Lam’s evidence

42.  In relation to Patrick Lam’s evidence, Mr Chau drew attention to his witness statement filed in the Labour Tribunal and submitted that his oral evidence at trial was a “radical departure” from that statement. In particular, Mr Chau referred to Patrick Lam’s evidence in that statement that he did not believe that he had promised the notice period would be increased from 3 months to 24 months, for the reason that this would be contrary to the standard provision of 3 months’ notice applicable to senior management of the group.  It was submitted that Patrick Lam’s evidence was not from personal knowledge, but based on corporate policy.

43.  However, Patrick Lam also said in that statement that as far as he could remember, he had not said that if the company wanted to terminate the plaintiff’s service, it would definitely give him enough, or that 24 months’ notice was not a problem.  This was clearly based on his recollection, and was entirely consistent with his evidence at trial.  The judge was entitled to take the view that the brevity of the statement in the Labour Tribunal was in part explained by the informal nature of the proceedings there.  There is nothing to show any error in the judge’s assessment of the evidence.

44.  Mr Chau also said that Patrick Lam’s evidence as to whether Eric Ma had enquired with him after receiving and before replying to the plaintiff’s letter of 14 May 2019 was “evasive and inconsistent”.  We have considered the transcripts of the evidence referred to.  It is in our view neither inconsistent nor evasive for Patrick Lam to say that, from his own recollection, Eric Ma did not contact him about the letter, but also to accept that he could not absolutely rule out that possibility.  More importantly, this is precisely the type of consideration that a trial judge is far better placed to assess in his overall evaluation of the evidence.  The plaintiff has signally failed to demonstrate any reviewable error in the judge’s assessment of Patrick Lam’s credibility.

Inherent probabilities

45.  Finally, Mr Chau criticized the judge for failing to take into account a number of factors regarding the inherent probabilities, namely: (i) he was wrong to find that Patrick Lam did not sympathise with the plaintiff and failed to take into account that it was probable for Patrick Lam to align with the plaintiff’s concern; (ii) a longer notice period was in the interests of both the plaintiff and the employer; (iii)  it was probable that by December 2004 the plaintiff had secured from Patrick Lam what he considered sufficient and so did not pursue the subject further; (iv)  as to the lack of writing, the plaintiff’s evidence was that Patrick Lam had said that not everything must be in writing and that his words were his bond and that Sky Connection was held by a traditional Chinese family; (v)  because by group policy the default notice period was 3 months, it was probable that Patrick Lam preferred to handle the plaintiff’s case informally without any written formality; and (vi) it was also probable that as a busy executive responsible for many portfolios, Patrick Lam had meant to follow up on his promises to the plaintiff but forgotten to do so.

46.  This contention is, with respect, wholly without merit.  First, the judge is not expected to set out in his judgment every matter raised in argument.  The fact that something was not expressly mentioned does not necessarily imply it had not been taken into account by the judge. 

47.  Secondly, many of the points raised by Mr Chau are simply instances where the judge disagreed with the plaintiff.  They do not properly support a submission that the judge had erred by failing to take relevant matters into account.  Thus, in relation to (i)  above, the judge considered that Patrick Lam had no reason to be sympathetic with the plaintiff.[13]  There was nothing the judge failed to take into account.  As to (ii), the judge took a different view of the commercial interests of the employer and employee with regard to a 24-month notice provision.[14]  As to (iii), the judge thought that it would be unlikely for seasoned business executives to leave the matter at an undefined “reasonable” period.  As to (iv), the judge disagreed and considered it “strange” for an agreement to vary the notice period not to be evidenced by a single piece of document or electronic footprint.  As to (v)  and (vi), these are simply speculations of which the judge cannot fairly be said to have failed to take account.  The judge could not be faulted for accepting Patrick Lam’s evidence that he could not have made a decision to vary the CEO’s notice period without consulting his fellow directors or informing the HR department.[15]

Conclusion

48.  For the above reasons, we reached the view that there was no ground for disturbing the judge’s findings of fact. 

49.  It is unnecessary to deal with whether the judge was correct in saying that there was no evidential basis to enable the court to determine what a reasonable period would be, and also unnecessary to deal with the questions of authority and estoppel. 

50.  Accordingly, the appeal was dismissed with costs.