CHEUNG SAU LIN v. TSUI WAH EFFORD MANAGEMENT LTD

DCEC 2438/2014

[2018] HKDC 941

IN THE DSTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 2438 OF 2014

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J U D G M E N T

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1.  This is an Employee’s Compensation claim which the Applicant has refused to attend a medical examination under Section 16 of the Employees’ Compensation Ordinance (Cap. 282) (the “ECO”).

2.  A split trial was ordered and the sole issue to be determined in the current trial is :

“Whether any compensation under the ECO shall be payable to the Applicant as a result of the Applicant’s failure to undergo a medical examination scheduled on 25 November 2014 as required under Section 16(1A) of the Ordinance.”

The law

3.  Section 16(1A) of the ECO provides:

“An employer may require an employee who is in receipt of a periodical payment under section 10 to undergo a medical examination from time to time, without expense to the employee, and the employee shall undergo the examination.”

4.  Section 16(1B) provides:

“Where an employee is required under…subsection (1A) to undergo a medical examination-

(a) If the employee is attended-

(i) By a registered medical practitioner, the examination shall be conducted by a registered medical practitioner named by the employer…”

5.  Section 16(2) provides:

“The employee shall, when required, attend upon the registered medical practitioner…at the time and place notified to the employee…provided such time and place is reasonable.”

6.  Section 16(3) provides:

“If the employee is, in the opinion of any registered medical practitioner, registered Chinese medicine practitioner or registered dentist, unable or not in a fit state to attend on the registered medical practitioner…named by the employer-

(a) that fact shall be notified to the employer; and

(b) the medical practitioner, Chines medicine practitioner or dentist so named shall-

(i) fix a reasonable time and place for a medical examination of the employee; and

(ii) notify the employee accordingly.”

7.  Section 16(4) provides-

“If the employee fails to undergo a medical examination as required under this section, his right to compensation shall be suspended until such examination has taken place; and if such failure extends over a period of 15 days from the date when the employee was required to undergo the examination under subsection (2) or (3), as the case may be, no compensation shall be payable, unless the Court is satisfied that there was reasonable cause for such failure.”

Interpretation of Section 16(4)

8.  One of the main dispute in this case is the interpretation of Section 16(4), in particular, whether it imposes a seemingly draconian sanction against the employee for failing to attend the medical examination “over a period of 15 days”.

9.  The Applicant relied on the obiter in the decision of HH Judge Mimmie Chan (as she then was) in Kwok Chi Lung v Kwan Poi Chi Walter trading as Big Apple (Central) DCEC689/2005.

10.  In that decision, the learned Judge was comparing Section 16(4) with Section 16(7). Section 16(7), in summary, concerned with the failure of the employee to submit to treatment unreasonably which had aggravated the injury. Under such circumstances, the compensation should be assessed as if the employee had undergone the treatment.

11.  In essence, the learned Judge’s view was that notwithstanding the difference in language used in Sections 16(4) compared to Section 16(7), she was not convinced that such difference should mean imposing a more severe sanction on an employee who fails to submit herself for an examination compared with an employee who refused treatment (see paragraph 30 of the decision).

12.  The Applicant relied on this to argue that the meaning of Section 16(4) was that the applicant’s right to compensation would not be extinguished, but merely suspended, for failing to attend the medical examination “over a period of 15 days”.

13.  I do not agree.

14.  The plain meaning of the section is that “no compensation shall be payable” (emphasis added) under such circumstances “unless the court is satisfied that there was reasonable cause for such failure”.

15.  If the intention of the legislation was that the compensation would simply be indefinitely suspended until the medical examination took place, then Section 16(4) should simply state:

“If the employee fails to undergo a medical examination as required under this section, his right to compensation shall be suspended until such examination has taken place”

and the passage should stop there.

16.  Reading Section 16(4) in its entirety, there are clearly two limbs to it: the first limb provides for an immediate suspension of right to compensation on failure to attend the medical examination and such suspension will be temporary if the employee subsequently attends the examination within 15 days. The second limb clearly envisages a scenario when the failure to attend a medical examination extends over a period of 15 days in which case no further compensation shall be payable forthwith “unless the court is satisfied that there was reasonable cause for such failure”.

Is this a rather draconian sanction?

17.  The objective of the ECO is to expeditiously provide financial relief to employees (genuinely) incapacitated by work injury regardless of fault on part of the employer. Thus the process needed to be simplified and straightforward: the right to claim as an employee is essentially established by providing sick leave certificates (Section 10(2)). As such, the legislation must necessarily provide a “balanced protection” mechanism so that, on one hand, there will be quick relief for genuine cases but, on the other hand, the compensation procedure should not be abused because of its relatively simple process.

18.  I have discussed the limitations of sick leave certificates in many previous cases. In a trial, sick leaves certificates should be treated no more than evidence that can be scrutinised by the court as to the circumstances under which they were provided and whether they were given reasonably etc. in light of all other available evidence including medical evidence before the court (Tam Fu Yip Fip v Sincere Engineering & Trading Co Ltd [2008] 5 HKLRD 210 and Gurung Kamala v Hong Wei Limited DCPI 1660/2010). Of course, such opportunities were not open to the employer under the ECO: the employee will have to pay the specified periodic payment merely on production of sick leave certificates.

19.  This would not have been a problem for injuries like fractures, torn ligaments, cuts and wounds etc., where there was clear objective medical evidence to support the genuineness and severities. Further, the employees might have undergone surgeries or other treatments and the treating doctors would know the anticipated recovery and convalescence periods so the periods of sick leave required should be largely uncontroversial.

20.  However, for cases where the employees were simply making subjective complaints with little or no objective medical evidence (e.g. various aches and pain, with lower back pain being the typical example), there might be a problem.

21.  As I have stated in previous decisions, doctors are trained to manage patients based on doctor-patient trust. I would imagine that a doctor would unlikely turn away a patient who was complaining of aches and pains despite little or no objective signs, and the doctor would likely have managed the patient with the usual regime of painkillers, rest (thus a period of sick leave) and a follow-up. Of course, if the patient were to return for a few follow-ups and there was no improvement, I would expect that the doctor would consider further treatment (e.g. stronger pain-killers, investigations like x-rays or scans, physiotherapy or even surgery etc.).

22.  This, however, means that the medical profession may be open for abuse because a patient who is more concerned about obtaining sick leave certificates than any medical treatment can visit a doctor for a few times (after each sick leave period runs out) and then see another, informing each doctor essentially the same subjective complaints, and skipping the follow-up appointments to find another doctor before the previous doctor gets suspicious or advises more serious or invasive treatments. There are thousands of doctors in private practice in Hong Kong, not to mention the large number of Hospital Authority A&E departments and government outpatient clinics. These would provide almost limitless opportunities for such “doctor-surfing” behaviour to prolong sick leave indefinitely without “genuine” or significant injury, or after essentially full recovery from the injury.

23.  Without any “protection” mechanism, the employer is at a great disadvantage against such behaviour. The employer is unlikely to be able to recover any compensation already paid out even if it is later proven at trial that the lengthy sick leave has been unreasonably prolonged by such “doctor-surfing” behaviour.

24.  Thus Section 16(4) is there to provide the essential “protection” mechanism to allow the employer to try to identify early on, before much compensation has been paid out, the “genuine” cases from the others by an expert who should be independent and not a treating doctor.

25.  Bearing such in mind, I do not think that Section 16(4) imposes a “draconian” sanction. One needs to balance this sanction with the fact that a delay of 15 days for the examination essentially also means an extra “free-ride” of half a month of compensation for the “doctor-surfing” employee. Further, it must be highly suspicious if the circumstance was that the employee could attend a doctor to seek sick leave but yet could not attend another (at a reasonable time and place) for a medical examination.

26.  After all, the legislation must have contemplated the circumstances that if an employee was so sick and disabled to render him unable to rise from the sick bed (metaphorically) for as long as 15 days to attend a doctor’s examination, there should be no difficulty for the employee to comply with Section 16(3) in obtaining an opinion from the treating doctor that the employee was unable or not in a fit state to attend the medical examination. Being genuinely sick and disabled to such an extent for 15 days should not be considered a minor matter: I would imagine that many patients undergoing even quite major surgeries would have recovered substantially to be discharged from hospitals in less than 15 days after the operations. Such patients, I would think, would be deemed by their treating doctors to be in a fit state to travel back home and, presumably, fit enough also to travel back to attend any medical follow-ups.

Comparing Section 16(4) to Section 16(7)

27.  The situation would have been very different under Section 16(7) when the employee has already consulted a medical practitioner who had recommended remedial treatment. In this situation, one must assume that the doctor, in making such recommendation, has confirmed that this was a “genuine” case. However, there may be risks and benefits with any medical treatment and a patient may have genuine or personal (but perhaps objectively unreasonable) reasons for refusing the treatment. A doctor could not force a patient to undergo a treatment without informed consent. Under the circumstances, it is only fair that the court would assess the compensation on the assumption that any (objectively) reasonable remedial treatment was performed.

28.  Therefore, it is entirely reasonable that the employee should be penalised less in this situation compared with failing to attend a medical examination under Section 16(4) when the employer has no way to know if this was a “genuine” case or not, but was required to continue to pay compensation nevertheless.

29.  It is also important to note that ECO is intended to be a “quick fix” and even if further compensation is not payable, it remains open for the employee to pursue a common law claim in negligence to recover all the damages.

30.  As such, there is no inconsistency in Section 16(4) with intention of the legislation regarding the overall objective of the ECO.

Any reasonable cause for failure to attend?

31.  In the current case, it is not in dispute that the Applicant received a letter from the Loss Adjusters on 11 November 2014 and a chaser on 17 November 2014 concerning the medical examination but failed to attend the medical examination fixed for 25 November 2014.

32.  It is also not in dispute that the Applicant failed to notify the Respondent of the opinion of any registered medical practitioner, registered Chinese medicine practitioner or registered dentist that she was unable or not in a fit state to attend the medical examination in compliance with Section 16(3).

33.  As such, there should therefore be no compensation “unless the court is satisfied that there was reasonable cause for such failure”.

34.  One “reasonable cause” might be whether thetime and place of the medical examination was reasonable (Section 16(2)).

35.  In her Reply, the Applicant stated that she was:-

“suffering from persistent and intense bilateral knee pain and could only walk very slowly. It would cause the Applicant great pain to make the trip from her home in Lantau Island to Dr. Cheng’s clinic in Central which would be a long journey requiring her to take the bus and then the MTR. Furthermore, the Applicant was unable to find any relative or friend to accompany her on the trip on 25 November 2014.”

36.  However, under cross-examination, the Applicant admitted in court that she could attend her lawyers in Sheung Wan on at least 3 occasions: once in September and twice in November 2014.

37.  I cannot see how, under the circumstances, that a medical examination taking place in Central on 3pm on a Tuesday could be considered unreasonable both in terms of time and place.

38.  Further, if her physical condition and failure to find someone to help were the real reasons, the Applicant, or her lawyers, should have replied immediately raise such so that the Loss Adjusters could find more convenient arrangements for the medical examination. The court needs to bear in mind the unfairness to the Respondent when there was delay of the medical examination when the Respondent has to continue to pay compensation all this time. Any delay in replying to the Respondent without proper reasons simply raise the suspicion of delaying tactics for more payment. I note that the Applicant was quite capable in writing to the Respondent on 10 November 2014 so there was no reason why she could not reply to this letter dated 11 November 2014.

39.  More importantly, if the Applicant was advancing a case that she was “unable or not in a fit state to attend”, there should be no problem for her to comply with Section 16(3) but, as above, she failed to do so and failed to provide any explanation why she failed to do so.

40.  In fact, the Applicant admitted that she ignored the letter dated 11 November 2014 and the chaser dated 17 November 2014.

41.  And when the Applicant’s solicitors, K Y Woo & Co eventually replied to the loss adjuster on 24 November 2014, one day before the date fixed for the medical examination, they stated that:

“Please be informed that our client is still on sick leave with medical follow-up treatments. Her medical condition is currently not static for assessment. In this regard, our client shall not attend the medical examination on 25^th November 2014.”

42.  Even then, K Y Woo & Co did not raise objections that the time or place of the medical examination was not reasonable, nor produce any opinion from any doctor that the Applicant was in such a condition that she was “unable or not in a fit state to attend” the medical examination.

43.  Section 16(3) clearly stated that the reason for not attending is that the employee was “unable or not in a fit state to attend” (in the opinion of a doctor etc.) and not being “still on sick leave” and “condition is currently not static for assessment”.

44.  Seeking to agree to the medical examination only when the employee no longer have sick leaves completely defeats the purpose of Section 16(4) because, in the circumstances as stated above, this would enable the employee to continue to “doctor-surf” and obtain sick leaves almost indefinitely and the employer would be forced to continue to pay compensation without the “protection mechanism” envisaged by the section. Taking this position would again support the suspicion of an ulterior motive of delaying tactics to seek more payments.

45.  As such, I am of the view that the Applicant being “still on sick leave with medical follow-up treatment” and her “medical condition currently not static for assessment” are not reasonable causes for failing to attend the medical examination.

46.  K Y Woo & Co eventually invited the Respondent to conduct a joint examination of experts on 7 January 2015. I consider this irrelevant as this was not the medical examination contemplated under Section 16(1A) because it took place well after the expiry of 15 days from 25 November 2014.

47.  In any case, I would have serious doubt as to the extent of the Applicant’s claimed pain and disabilities. She informed the court that during the relevant time (October 2014) she suffered from continuous pain: 8 degrees out of a scale of 10 (when 0 is “no pain” and 10 is “the maximum pain one can imagine, e.g. labour pain). She was taking panadols, another anti-inflammatory medicine and stomach medicine but these would only reduce the pain to 5-6 degrees for 2 to 3 hours, and the prescription were for 4 or 6 hourly. As such, she would remain in constant pain 24 hours of moderate to severe degree, and she could not sleep well because of the pain (worst at night) half the time.

48.  When asked whether she informed the doctor that the medications did not work, the Applicant was very hesitant and inconsistent. At first, she said that she did not dare to tell the doctor, just that she had pain. When it was put to her whether it was her case that she would rather continue to suffer such continuous pain than to tell the doctor that the medications did not work, she then changed her story and said that she did tell the doctor so. When she was asked what the doctor reply was, such as whether the doctor changed the medications, the Applicant then revert back to the story that she only told the doctor that she had pain. She even said that the doctor did not ask her about the history of her injury such as whether she has seen other doctors, what medications she was taking and whether the medications helped. She said that she did not know what to say.

49.  Further, she failed to provide convincing explanation as to why she needed to wait until the expiry of the sick leave period before attending A&E Department again when the medications clearly did not cure her pain.

50.  In short, from what little evidence revealed so far, it would appear that her “pain behaviour” was inconsistent with what one might expect that a reasonable patient who suffered such extent of pain would behave, and the impression must be that the Applicant was more concerned with seeking sick leaves (and “riding them out” fully) than genuine medical treatment (Gurung Kamala v Hong Wei Limited DCPI 1660/2010), and this, of course, might infer that whatever pain or disabilities that the Applicant claimed to be suffering from must be something she was less concerned about than seeking sick leave.

51.  This would raise the question of her credibility regarding her alleged pain and difficulties in attending the medical examination and, clearly, this is the exact type of cases that the “balanced protection” mechanism of Section 16(4) would be essential to protect the interest of the employer.

52.  As such, I am not convinced by the evidence that there was any reasonable cause regarding the Applicant’s physical condition at the relevant time for her failure to attend the medical examination.

Was there a breach of Section 10(3)?

53.  Section 10(3) stated that:

“Periodical payments under this section shall be payable on the same days as wages would have been payable to the employee if he had continued to be employed under the contract of service or apprenticeship under which he was employed at the time of the accident:

Provided that—

(a) by agreement or by order of the Court, the periodical payments may be made at shorter intervals; and

(b) the interval between periodical payments shall not exceed 1 month.”

54.  It follows that if the employer did not pay the periodic payments as specified, the employer cannot require the employee to undergo a medical examination (Section 16(10A), see paragraph 3 above).

55.  There was no dispute that the Applicant received the specified periodic payments on August and September 2014 by way of bank transmission around 5^th to 7^th of each month.

56.  However, the Respondent called the Applicant around 10 am on 6 November 2014 (according to a letter dated 6 November 2014 from the Respondent) to seek to arrange for the Applicant to meet at Respondent’s office at 3 pm to receive the payment for the month of October 2014 (plus reimbursement of some medical expenses) instead of bank transmission.

57.  The Applicant refused. In her letter dated 10 November 2014, she requested the payment by way of bank transmission as before. She did not give any reasons why she would not agree to this arrangement but added that the Respondent had requested her to attend the company to sign some “insurance company documents” and she declared that she would not sign such documents.

58.  There were further discussions between the parties and the meeting eventually took place on 13 November 2014 at a fast food restaurant in Tung Chung. However, the Applicant only received a cheque for HK$8,184 (which covered the periodic payment for sick leave only up to 22 October 2014).

59.  The Applicant’s argument was that, at the time the medical examination was requested (11 November 2014), the Respondent still have not paid the outstanding payment for 23 to 31 October 2014, and since the periodic payment under Section 10 was not fulfilled under the circumstances, the Respondent was not entitled to request a medical examination under Section 16(1A).

60.  The Respondent has called Madam Lau Yuen Wah who was working in as a senior staff in the Respondent’s human resources department at the time. She no longer works with the Respondent.

61.  Madam Lau explained that the usual system in the Respondent company was that the staff on sick leave would attend the Respondent’s office at Kwai Chung to deliver the sick leave certificates. She would then enter the record on the company’s computer system and the periodic payment would be calculated on basis of the sick leave certificates received by the end of each month and the staff would be paid on the 5^th day of the next month.

62.  However, the Applicant did not want to attend the office but instead left her sick leave certificates with the restaurant branch she used to be working at, and relied on someone there to deliver the certificates.

63.  For the month of October 2014, the Applicant could not remember when she submitted these sick leave certificates. However, Madam Lau gave evidence that she only received the Applicant’s 3 sick leave certificates covering 23 to 31 October 2014 on 3 November 2014. Thus, these certificates had missed the deadline for calculation at the end of October. This was the reason why the Applicant only received HK$8,184. As such, the sick leave payment for 23 to 31 October 2014 was only released to the Applicant in the next payment in December 2014.

64.  Madam Lau also produced the 3 sick leave certificates in question which were all stamped “Received 3 November 2014”.

65.  I accept MadamLau’s evidence. It is clear that there was no attempt by the Respondent not to pay this part of the periodic payment.

66.  Sections 10(2) and 10(3) specified that the period of total temporary incapacity would be the period of absence of duty certified by a doctor etc., and that the periodic payment should be paid on the same day as if the worker was still had been employed etc. However, given that for many employers, especially large companies, there would be systems of staff payment so the court must allow some flexibility for a reasonable administrative “time lag” between production of sick leaves, calculation of periodic payment and the actual payment.

67.  I find that the Respondent’s system of sick leave payment was not unreasonable given the size of the company and, I would imagine, the total number of staff working in it. Since the Applicant only delivered the sick leave certificates 2-3 days before the payment date, I do not find it unreasonable that the Respondent’s administrative system could not deal with them in time and could only pay the compensation in the next month.

68.  Another issue was whether it was reasonable for the Respondent to arrange for the Applicant to attend the office to pick up the cheque for the periodic payment.

69.  Firstly, the ECO did not specify the form of the periodic payment. Secondly, if the Applicant really had such physical difficulty in attending the Respondent’s office (as she now alleged), she certainly did not raise it in her letter of 10 November 2014, and any such disabilities did not prevent her from attending her own lawyers’ office on several occasions in Sheung Wan. As discussed above, I also have serious reservations about the Applicant’s claimed physical condition at the time.

70.  The Respondent did agree to meet in a fast food restaurant near the Applicant’s home instead.

71.  If there was any allegation that the Applicant was pressurised to sign any documents (which I understood were consent for release of the Applicant’s medical records concerning the injury), the cheque was released to her without her signing any documents, at a time and place she has agreed to.

72.  Thus the overall impression was that the Applicant was simply being uncooperative and avoiding contact with the Respondent. I see little reason why she should do if there was a genuine on-going injury. If there were fully supportive medical records, I could not see why the Applicant would be reluctant to release them. In fact, if a medical examination under Section 16(1A) were to take place, it would be entirely reasonable and proper for the contemporaneous medical records to be released to the medical expert for preparation of the expert report. This is, therefore, the exact suspicious situation that the “protecting” mechanism for the employer should be allowed to operate.

73.  As such, I do not find that the Respondent has breached Section 10(3).

Estoppel

74.  As an alternative case, the Applicant raised that she had relied on the wordings in the Loss Adjuster’s letters and she only thought that her Section 10 payment would merely be suspended temporarily.

75.  The wordings in the letters, as translated, read:

“According to ECO Section 16, if you do not wish to accept the above medical examination, your right to employee’s compensation (including payment during sick leave) would be temporarily stopped until the medical examination takes place. In order to prevent your right to claim compensation from being stopped, please accept the above mentioned medical examination.”

76.  I would agree that the wordings were not entirely clear: the first sentence seems to suggest that the right to compensation would be temporarily stopped until the medical examination took place, but the second sentence did suggest that the right to claim compensation could be “stopped”, not just temporarily.

77.  In any case, I cannot see why the Applicant would rely on such wordings: she has her own lawyers who have clearly read such letters and made a reply to the Loss Adjusters on 24 November 2014, presumably on her instructions after legal advice.

78.  I would therefore not accept that the concept of estoppel should apply under such circumstances.

Conclusion

79.  In view of the above, the court finds that the Applicant has failed to undergo a medical examination scheduled on 25 November 2014 as required under Section 16(1A) and, under the first limb of Section 16(4), her right to compensation has been suspended on 25 November 2014. 

80.  Further, the court finds that such failure extends over a period of 15 days from the date when the employee was required to undergo the examination (i.e. up until 10 December 2014) and there was no reasonable cause of such failure. As such, under the second limb of Section 16(4), no further compensation should be payable.

81.  As the Applicant has already been compensated up to 24 November 2014, I would dismiss this employees’ compensation action and gives an order nisi for the costs of the action be awarded to the Respondent to be taxed if not agreed, with certificate for one counsel.