RAI GEHENDRA RAJ v. SAM LEE CO AND OTHERS

DCEC 2700/2017

[2018] HKDC 1524

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO 2700 OF 2017

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REASONS FOR DECISION

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A.   INTRODUCTION

1.  Mr Rai alleged that he suffered personal injuries from an alleged accident on 29 August 2008 arising out of and in the course of employment with his employer, Sam Lee Company (“Sam Lee”). Yick Hing Construction Company Limited (“Yick Hing”) was alleged to have been the principal contractor.

2.  A few days before the expiry of the three years’ time limit for the institution of a personal injury claim, Mr Rai issued, on 23 August 2011, in person, a writ in the High Court (HCA 1432/2011, which became HCPI 48/2012 upon the transfer of the HCA action into the personal injuries list) (“PI Action”) against Sam Lee and Yick Hing for the personal injuries that he had allegedly suffered in the alleged accident.

3.  On 12 December 2011, Mr Rai was granted legal aid.  On 31 July 2012, Mr Rai discontinued the PI Action as against Sam Lee, and pursued Yick Hing only.  On 6 May 2015, Mr Rai’s legal aid certificate was discharged.  Hence, at the trial before Lisa Wong J, Mr Rai was unrepresented.  On 31 August 2017, Lisa Wong J dismissed Mr Rai’s PI Action after trial.

4.  After he lost the PI Action, Mr Rai, on 24 November 2017, filed in person this employees’ compensation application (“Application”) pursuant to the Employees’ Compensation Ordinance (“ECO”) against Sam Lee and Yick Hing as the 1st and the 2nd respondents.

5.  Thus, the Application was commenced about 9 years and 3 months after the alleged accident.  Under s 14(1), ECO, that mandates a limitation period of 2 years, Mr Rai’s Application was late by 7 years and 3 months, and was liable to be struck out unless Mr Rai could satisfy this court that there was reasonable excuse for his failure to commence the Application within the statutory time limit.

6.  Sam Lee however had already ceased business, and its sole proprietor could not be located.  The insurer, Chevalier Insurance Company Limited, was later added as the 3rd respondent so that it could defend the Application as if it were Sam Lee.

7.  On 27 March 2018, the Court of Appeal dismissed on paper Mr Rai’s appeal against the dismissal judgment of Lisa Wong J upon Mr Rai’s default of payment of security for the costs of his appeal.

8.  On 7 August 2018, the solicitors for Yick Hing and the insurer issued a summons to strike out the Application on two grounds. First, by the operation of the doctrine of issue estoppel that precluded Mr Rai from re-litigating in respect of the same alleged accident as in the PI Action, which had already been adjudicated upon. Second, the Application was time-barred.

9.  At the hearing of the summons on 27 November 2018, Mr Rai acted in person.  Yick Hing and the insurer were represented by counsel, Mr Herbert Leung.  After having heard from the parties, I granted an order in terms of §§1 and 2 of the summons by striking out the Application against all three respondents on the grounds that (i) it is frivolous and vexatious, and otherwise an abuse of the process of the court; and (ii) the Application is time barred by reason of s 14(1), ECO.

10.  I indicated to the parties at the hearing that I would give my reasons later, which I now do.

B.   ISSUE ESTOPPEL

11.  It is the respondents’ contention that the alleged accident in these proceedings is based on the same alleged accident as in the PI Action that had already been decided against Mr Rai.  As the adjudication of the PI Action, upon the Court of Appeal’s dismissal of Mr Rai’s appeal (see §7 above), was then final, Mr Leung submitted that Mr Rai should not be allowed to litigate on the same question again.  Were the Application allowed to proceed, the respondents stated that they would suffer serious prejudice, particularly because the alleged employer has since disappeared.   

12.  It is noted that Mr Rai neither deposed to the respondents’ contention of issue estoppel in his affirmation filed in opposition nor made any submission.

13.  I do not think that Mr Rai could have any ground to oppose this contention. Based on the evidence that was placed before me, I consider that the respondents’ contention is valid.  Mr Rai, by instituting the Application for the same alleged accident as in the PI Action, was plainly seeking to reopen the same issues in this Application. After the learned Lisa Wong J found after trial that “Mr Rai has not discharged the burden of proving the accident as described by him” (per Lisa Wong J, HCPI 48/2012, § 36), and the later dismissal of his appeal, Mr Rai would be subject to the doctrine of issue estoppel.

14.  In the circumstances, I was satisfied that the respondents had established issue estoppel against Mr Rai. By the operation of the principles of res judicata or issue estoppel, it would have been an abuse of process of the court to allow Mr Rai to litigate over the identical issue: see Sze Lai Man v Wing On Department Stores (Hong Kong) Ltd [2001] 1 HKC 297.

15.  Since there are no special circumstances where the principle of res judicata does not apply, I conclude that the Application is frivolous and vexatious, and an abuse of the process of the court, and make an order of striking out.

C.      NO REASONABLE EXCUSE

16.  Since Mr Rai had instituted the Application out of time, he was required to show reasonable excuse.

17.  The factors a court needs to take into account when exercising its discretion as to whether an applicant has shown reasonable excuse are authoritatively set out in the Court of Appeal decision of Tsang Loi Fat v Sun Fook Kong [2011] 4 HKLRD 344.  As to what constitutes reasonable excuse is fact-sensitive.  The non-exhaustive list of factors includes: (i) the reason for the delay; (ii) the length of the delay; (iii) merits of the claim; (iv) whether prejudice would be caused to the interest of the respondent if an extension of time is granted; (v) the age, education level, intelligence and background of the claimant but ignorance of the law is generally not a reasonable excuse for the delay; (vi) the claimant’s health condition; and (vii) whether the claimant's failure to make a claim before the expiry of the prescribed period was induced by the conduct of or words said by his employer, insurance company, or a third party: (see Tsang Loi Fat [2011] 4 HKLRD 344 at 348-349).

18.  In this case, I consider the delay of 7 years and 3 months to be a lengthy delay.  Hence, Mr Rai shall be required to show that his Application has an extremely high chance of success.  In light of my conclusion on the issue of estoppel, Mr Rai has clearly failed to establish merits in this Application.

19.  In the affirmation in opposition, Mr Rai gave the following excuse to explain the delay.

20.  First, it was shortly before he commenced these proceedings that he found out in around November 2017 from the Labour Department about the venue for the claiming of employees’ compensation in the District Court.

21.  Second, due to the language barrier as a Nepali-native speaker, Mr Rai averred that he was ignorant of the 2 years’ time limit.

22.  Third, the certificate of review of assessment issued by the Medical Assessment Board of the Labour Department on 25 October 2018 stating that he has suffered 4 percent of loss of earning capacity proves that he suffered permanent loss of earning capacity.

23.  As stated above, ignorance of the law is not a reasonable excuse for the delay: Tsang Loi Fat (supra).

24.  In any event, I do not find that Mr Rai has adduced sufficient evidence to support his asserted ignorance. Contrary to his allegation of his language barrier being the reason for the alleged ignorance, the evidence seems to rather suggest that Mr Rai had in the past a lot of experience in asserting his legal rights.

25.  According to his witness statement he relied on in the PI Action, Mr Rai was born in Hong Kong but grew up in Nepal.  He only returned to Hong Kong in 1995 when he was about 30.  He speaks little English but no Cantonese.  Before the alleged accident, he had worked in different positions in construction sites.

26.  Before the alleged accident, there was a dispute over unpaid wages.  Mr Rai together with other Nepalese workers lodged a complaint to the Labour Department, which filed a claim for Mr Rai and other workers in the Labour Tribunal before he was paid.

27.  I also do not accept that Mr Rai did not know how to commence an employees’ compensation claim.  As early as 25 March 2009, several months after the alleged accident, Mr Rai completed a pro-forma questionnaire provided by the Employees’ Compensation Division of the Labour Department.  In that questionnaire, Mr Rai gave details of the circumstances of the alleged accident.  I believe that Mr Rai would have had little difficulty in obtaining information from the Labour Department about the procedure for the institution of an application for employees’ compensation.

28.  More importantly, in the PI Action, Mr Rai, for more than 3 years, between 12 December 2011 and 6 May 2015, was legally represented by legal aid.   Under such circumstances, it would have been inconceivable, in my view, that Mr Rai only allegedly became aware of the time limit for commencing employee’s compensation proceedings after the dismissal of his PI Action in August 2017.

29.  Counsel was right to submit that Mr Rai’s assertion about his ignorance of the time limit is incredible.  He also drew my attention to the fact that Mr Rai, albeit acting in person, appears to have been professionally assisted in these proceedings.  Mr Rai’s Application and his affirmation in opposition were evidently professionally drafted by a person who has experience in civil litigation.

30.  Mr Rai’s affirmation, counsel stated, is in fact in the English language without any interpretation.  Hence, counsel contended that Mr Rai’s alleged language barrier is also unbelievable.

31.  The irresistible inference, counsel submitted, is that Mr Rai slept on his right to commence an action for employees' compensation.

32.  I am in agreement with counsel’s submissions.  The chronology of the background facts before the commencement of this Application plainly does not support Mr Rai’s given explanation that the delay in the institution of the proceedings was due to his alleged ignorance and language difficulty.

33.  Rather, I’d more inclined to believe that Mr Rai instituted the belated Application as a second bite of cherry to re-open the allegation of the accident after the dismissal of the PI Action.

34.  Since I have rejected Mr Rai’s first and second reasons for the delay, I consider that his third reason, the medical assessment, is a red-herring.

35.  In conclusion therefore, I am not satisfied that Mr Rai has given reasonable excuse for his failure to commence the Application within time.

D.      PREJUDICE TO RESPONDENTS

36.  The conclusion that I have reached in the preceding section means that this court should not grant leave to Mr Rai to extend time to institute the proceedings.  The Application ought to be struck out.

37.  For completeness, I will also briefly deal with the prejudice argument that Mr Leung has advanced.  It was submitted that were the Application allowed to continue after such a long lapse of time, the respondents would be prejudiced for not only having been vexed twice, but would also be financially prejudiced. It would have been most unlikely for the respondents to have been able to recover any costs from Mr Rai even if they succeeded in opposing the claim.

38.  I am in respectful agreement with counsel and accept that the respondents, especially Yick Hing, would be prejudiced were the Application allowed to proceed.  After Yick Hing has incurred expenses and spent time in the PI Action in defending the claim, it would not have been fair for it to have to incur more costs and expenses in defending this Application that it would have little prospect to recover.

39.  The gravity of the prejudice is so enormous that I’d be most disinclined to exercise my discretion in granting Mr Rai indulgence for his long delay in bringing the unmeritorious Application.

40.  For these reasons, I acceded to the summons by striking out the Application.

41.  If Mr Rai requires interpretation of this “Reasons for Decision”, he should contact my clerk for the arrangement of an English/Nepalese interpreter.