HO MAN FAI v. COSMOS TRAVEL LTD AND ANOTHER

DCEC 1879/2025

[2026] HKDC 617

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO 1879 OF 2025

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IN THE MATTER OF AN APPLICATION BETWEEN

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REASONS FOR DECISION

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1.  This is the hearing of the summons taken out by China Taiping Insurance (HK) Company Limited (“the Insurer”) dated 11 March 2026 (“Summons”) to join these proceedings as a party. After hearing from solicitors acting for the Applicant and the Insurer, I granted leave for the Insurer to be joined as the 2^nd Respondent and gave certain procedural directions. The Respondent (who is now renamed as the 1^st Respondent (“R1”) in these proceedings) was absent from the hearing.

2.  The joinder was not granted on a consensual basis. As R1 was absent and there are certain legal points warranting attention, I feel obliged to hand down my reasons for decision after disposing of the Summons.

3.  The Applicant claims that he met an accident on 25 April 2024 in the course of his employment with R1 and suffered injuries out of the employment. For the present purpose, it is not necessary to go into the details of the accident pleaded in the Application.

4.  Service of the Application on R1 was initially unsuccessful, but it was later effected in December 2025 by a clerk of the solicitors firm acting for the Applicant. On 9 January 2026, R1’s director, one Mr Lau, attended a call-over hearing with the Applicant’s solicitor before Her Honour Judge Loh. Although R1 had not yet filed the documents required under Order 5A, rule 2(2)(c) of the Rules of the District Court (Cap. 336H) (“RDC”) on that day, Her Honour permitted Mr Lau to represent R1 to take part in that hearing. After hearing from the parties, the learned Judge directed R1 to file and serve an Answer and certain other documents within 28 days; discovery of documents and a second call-over hearing were also directed. In addition, R1 was specifically ordered to comply with the aforesaid requirement under rule 2(2)(c) within 14 days by filing an affirmation exhibiting a proper authorizing resolution.

5.  A few days later on 12 January 2026, the Applicant’s solicitors issued a “Notice to Insurer” to the Insurer and filed the same with the Court. According to what Ms Chan of the Applicant’s solicitors told me during the hearing of the Summons, the Applicant’s side did not know the identity of any relevant insurer until she personally met Mr Lau of R1 on 9 January 2026 and was told about the existence of an insurance policy between R1 and the Insurer, which might cover the subject accident.

6.  R1 took no step to comply with Judge Loh’s orders/directions within the specified timeframe. No Answer was filed and not even the documents under the aforesaid rule 2(2)(c) were filed.

7.  The Insurer filed a Notice to Act, the Summons and a supporting affirmation on 11 March 2026 seeking to join as the 2^nd Respondent.

8.  The deponent of the supporting affirmation has (i) exhibited a copy of the relevant insurance policy; (ii) set out the clauses requiring R1 to notify the Insurer of claims/demands; (iii) stated that R1 had failed that contractual duty of notification; (iv) stated that the Insurer had informed R1 of its repudiation of liability to indemnify R1 in respect of the subject accident; and (v) referred to provisions in the Employees’ Compensation Ordinance (Cap. 282) (“ECO”) conferring on the Applicant a right to directly enforce an employees’ compensation judgment in his favour against the Insurer.

9.  The Summons was served on both the Applicant and R1. Ms Chan told me during the hearing of the Summons that the Applicant adopts a neutral stance, but she acknowledged the concern that upon the Insurer’s participation, the Applicant may be liable to pay two sets of legal costs should the claim fail. Ms Chan also fairly gave me the following information:

(a)  R1 has not reported the subject accident to the Labour Department by way of a Form 2;

(b)  Apart from not complying with the Court’s orders/directions, R1 has not served anything on the Applicant or been in correspondence/communication with the Applicant’s solicitors on this case, except attending the aforesaid hearing on 9 January 2026 and meeting/talking to her there; and

(c)  The sealed order of the hearing on 9 January 2026 was attempted to be served by the Applicant’s solicitors on R1 by ordinary post, yet the post was unclaimed and returned. The Applicant’s solicitors subsequently served the order by leaving at R1’s registered address.

10.  In Shing Ho Wa, a mentally incapacitated person by his mother and next friend, Lam Wai Fong v Really Super Ltd (formerly known as Bruce Law Stunts Ltd) & Ors (unrep, DCEC 2437/2015, 10 Nov 2016), Deputy District Judge SH Lee (as he then was) set out a few important principles on intervention by insurers in the ECO context:

(a)  By operation of the ECO, an insurer in the Insurer’s position is potentially under a direct liability towards an employee seeking compensation, but the employee’s direct cause of action does not accrue until the compensation has been quantified;

(b)  After quantification, an insurer will have a right to be heard in the action seeking to recover the compensation from it. The insurer may raise points such as the insurance policy not covering the specific accident or not in force in relation to the claiming employee at the time of the accident;

(c)  Intervention by the insurers to the underlying ECO proceedings between the employee and the employer is not as of right. The Employees’ Compensation Regulations (Cap. 282A) and the RDC give the Court a wide discretion on the issue of joinder, which must be exercised judicially by taking into account all relevant matters and disregard irrelevant matters; and

(d)  There is no general rule or practice of allowing an insurer on its application to be joined alongside a respondent in the event of a disclaimer of the insurance policy.

11.  In that case, the insurer’s joinder application was dismissed. From my reading of the judgment, the factor affecting the learned Judge’s exercise of discretion most was the fact that the original respondents of the proceedings were legally represented and actively defending the applicant’s claim before the insurer’s application for intervention was made. Concerns about multiple legal representation in the same interest and the lack of a positive case on liability/quantum from the insurer were also taken into account. The applicant therein objected to the joinder application, whereas the original respondents were either excused from the debate or neutral.

12.  Coming back to the present case, R1 did take part in a call-over hearing of these proceedings not long ago on 9 January 2026. However, there are various signals that it may no longer take any active part in the proceedings, including its failures to (i) comply with Judge Loh’s directions; (ii) engage a solicitor or fulfill the simple requirement under RDC for it to be represented otherwise than by solicitors; and (iii) report the subject accident to the Labour Department and the Insurer (according to, respectively, Ms Chan for the Applicant and the Insurer’s affirmation). The recent non-delivery of an ordinary post containing the Court’s sealed order dated 9 January 2026 mentioned by Ms Chan reinforces the inference that R1 may abandon its defence.

13.  Moreover, while the Applicant is not prepared to give consent, I note he has not actively opposed to the Insurer’s joinder. Ms Lee for the Insurer said the Insurer has an interest in reserving the right to contest liability and quantum of the Applicant’s claim and obtaining all court documents of this case, and the same will be best achieved by allowing the joinder. I agree. I also note that the Insurer acts promptly in filing this joinder application.

14.  Taking into account all relevant factors, and exercising my discretion judicially, I make the following orders:

(1)  Leave for CHINA TAIPING INSURANCE (HK) COMPANY LIMITED be joined as the 2^nd Respondent in this action (hereinafter called the 2^nd Respondent) and the original Respondent be named as the 1^st Respondent;

(2)  The 2^nd Respondent do have leave to defend on the issues of liability and quantum;

(3)  Leave for the Applicant to amend the Application in the manner as shown in red as per paragraph 1 hereinabove within 21 days from the date of this Order;

(4)  The Applicant do file and serve the Amended Application, verified by statements of truth, on all the Respondents within 21 days from the date of this Order;

(5)  The 2^nd Respondent do file an Answer within 35 days from paragraph 4 hereinabove verified by statement of truth, if any; and

(6)  Costs of this application be in the cause.

15.  Permission of this joinder application is based on the specific circumstances of this case. Practitioners and insurers should not take it for granted that insurers will be generally allowed to join alongside a respondent in the event of a disclaimer/repudiation of indemnity. As Judge Lee said in Shing Ho Wa, the Court’s discretion is not fettered by such disclaimer/repudiation of indemnity.