SUMITRA JAYASENA KELLY v. CATHAY PACIFIC AIRWAYS LTD

HCMP 2448/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 2448 OF 2006

(ON AN INTENDED APPEAL FROM HCLA NO. 94 OF 2005)

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REASONS  FOR  JUDGMENT

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Hon Tang VP (giving the reasons for judgment of the Court):

1.  The claimant is a retired cabin attendant.  She claimed against the defendant for retirement travel benefits (“RTB”) for her husband.

2.  It is common ground that the claimant was eligible for such benefit.  The dispute between the parties is over whether the RTB was a contractual entitlement (the claimant’s case) or at the discretion of the defendant (the defendant’s case).

3.  The claimant succeeded in the Labour Tribunal where the Deputy Presiding Officer, Mr Reuden Lai, after a three-day hearing which ended on 9 December 2005, determined the claim in favour of the claimant on 20 December 2005.  The reasons for decision (“the decision”) were handed down on 20 February 2006.

4.  On appeal by the defendant, the decision was reversed by Deputy Judge L Chan by judgment dated 3 October 2006.

5.  By a notice of ex parte application for leave to appeal (out of time), dated 21 November 2006, the claimant applied for an order that she be given leave to appeal against the order of the learned deputy judge.  The grounds of the appeal of the proposed appeal were set out in the draft notice of appeal annexed to the notice of ex-parte application.  The application was supported by the affidavit of Poon Sui-wah, a partner of Messrs Fairbairn Catley Low & Kong, the solicitors for the claimant.

6.  According to the affidavit, the learned deputy judge delivered an oral judgment on 3 October 2006, and the typed up judgment (“the judgment”) was available for collection on about 23 October 2006.  The order was sealed on 24 October 2006.  Mr Poon, after consulting the Supreme Court Practice, thought that the time for appealing was 28 days beginning on the date immediately following the date of the sealing of the order, pursuant to Order 59 Rule 4.  In that case, the deadline would fall on 21 November 2006.

7.  He then sent papers to a new senior counsel to advise on the prospects of an appeal, and if so advised, to settle the grounds of appeal on or before 20 November 2006.

8.  However, on 14 November 2006 Mr Poon enquired of the Registrar about the intended appeal, and was informed that time for such appeal is governed by section 35A of the Labour Tribunal Ordinance, Cap. 25 (“the Ordinance”).

9.  Under section 35A of the Ordinance, the application for leave to appeal should be made within 7 days after the date of the decision of the Court of First Instance.

10.  Mr Poon concluded by saying in para. 7:

“7. In the circumstances, I do hope the Court would allow this application to seek leave to appeal out of time having taken into account of the fact that the length of delay is rather short and there is no prejudice to the Defendant and after having considered the grounds of appeal annexed to the application.”

11.  Section 35A governs appeal to the Court of Appeal and provides as follows:

“(1)	If any party is dissatisfied with a decision of the Court of First Instance on an appeal heard by leave given under section 32, such party may, within 7 days after the date of the decision, apply to the Court of Appeal for leave to appeal and, if the Court of Appeal considers that a question of law of general public importance is involved, it may grant leave.
(2)	An application for leave to appeal under this section shall be-
	(a)	in the prescribed form, setting out the question of law; and
	(b)	lodged with the Registrar of the High Court.
(3)	A refusal by the Court of Appeal to grant leave to appeal shall be final.”

12.  Thus, it is only if the Court of Appeal considers that a question of law of general public importance is involved that it should grant leave.

13.  Notwithstanding section 35A(2) there was no prescribed form, although there is in fact a prescribed form, namely Form 14, for appeals to the Court of First Instance.  We mention in passing that leave to appeal to the Court of First Instance may be given on the ground that the award order or determination is:

(a)   erroneous in point of law; or

(b)   outside the jurisdiction of the tribunal.

14.  On 19 December 2006, leave was granted by Le Pichon JA.  No reason was given.

15.  By a summons dated 28 December 2006, the defendant applied under Order 59 rule 14, for an order that the order of Le Pichon JA dated 19 December 2006, granting leave to appeal against the order of the deputy judge dated 3 October 2006 be rescinded.

16.  On 30 March 2006, we rescinded leave to appeal with costs.

17.  Prior to the hearing before us, Mr Simon K M Lui, who appeared on behalf of the claimant, supplied us with a statement of the questions of law of general public importance said to be involved in the appeal and they are as follows:

“The questions of law of general public importance involved in the present appeal are as follows:-

(1)    When an employer issues to its employee, separately from the formal contract of employment a handbook, booklet, manual or a document which appears to confer on the employee one or more benefits, what principles are to be followed in determining whether such a handbook, booklet, manual or document or the benefits contained therein have been incorporated into a contract of employment?

(2)    Notwithstanding section 35(2)(b)(i) of the Labour Tribunal Ordinance, Cap. 25 which precludes the Court of First Instance from reversing or varying any determination made by the Labour Tribunal on questions of fact, are there circumstances in which the Court of First Instance is entitled to reverse or vary a determination of fact made by the Labour Tribunal, and if so, to what extent and on what principles?”

18.  In order to understand whether these questions are involved in the appeal, it is necessary to consider the decision as well as the judgment.

19.  The claimant’s claim was based on her contract of employment.  Her employment was confirmed by the letter dated 27 November 1984, which was made expressly subject to the defendant’s Conditions of Service for cabin attendants (1981 version) (“the 1981 COS”).

20.  Clause 17 of the 1981 COS set out provisions on rebated travel available to the defendant’s cabin attendants.  It referred to a document called “Staff Travel-CX and Interline Rules and Regulations Booklet” (“the Booklet”).  It was the claimant’s case that her entitlement to RTB were set out in the Booklet.

21.  However, the tribunal officer said at para. 46 of his decision:

“I accept DCR’s evidence and find that the booklet referred to in the 1981 COS was not related to RTB.”

22.  DCR is Mr Robert John Nipperess, who represented the defendant in the tribunal.

23.  However the claimant also relied on various staff benefits handbook.  But the tribunal officer found that the various staff benefits handbooks were “not a contractual document but only a guide”.  para. 49 of the decision.

24.  The tribunal officer, under the heading of “finding of facts”, said:

“51.      However, I find that the Staff Benefits Handbooks were evidence of contractual benefits enjoyed by the Defendant’s cabin attendants from time to time.”

25.  The learned judge approached the matter as a matter of construction of the employment contract and came to the following conclusion:

“Conclusion on construction

35.       In the premises I hold that the Presiding Officer had misconstrued clause 17 of the 1981 Conditions of Service (or clause 18 of the 1986 Conditions of Service) and thus fell into an error of law.  I further hold that properly construed, clause 17 of the 1981 Conditions (and clause 18 of the 1986 Conditions) do not include RTB.”

26.  It is clear from the judgment that the learned judge did not purport to reverse or vary any determination made by the tribunal on a question of fact which the judge was not entitled to do.  See section 35(2)(b)(i).

27.  Indeed, although the tribunal officer said in para. 51 of the decision that the staff benefits handbooks were evidence of contractual benefits enjoyed by the defendant’s cabin attendants from time to time, we understand from Mr Lui that not all the benefits covered by the staff benefits handbooks were contractual entitlements.  So although para. 51 of the decision appeared to be a finding of fact by the tribunal officer, it is the question of law whether there was factual basis upon which that finding was based.

28.  We have found it easy to ascertain the basis upon which the tribunal officer came to the conclusion in para. 51 of his decision.  Mr Simon Lui, referred to The Interpretation of Contracts by Kim Lewison QC, to show that the evidence of acts of user is admissible as an aid to the construction of the contract of employment.  We do not believe this is of assistance.  As we have mentioned, the dispute between the parties is over whether the RTB was contractual or discretionary.  So evidence of user would not help.  But, as is clear from The Interpretation of Contracts at 11.05, the authorities cited therein related to the interpretation of parcels clauses.  As Megarry J (as he then was) in St Edmundsbury & Ipswich Board of Finance v Clark No. 2 [1973] 1 WLR 1572, and quoted by Lewison, said:

“… One may accept to the full that it (this doctrine) does not apply to commercial contracts or, for that matter, to any language of obligation, whatever the document.”

29.  Therefore, the fact that the claimant and other persons in her positions had enjoyed RTB is not admissible as an aid to the construction of the employment contract.  But even if such user is admissible as an aid to construction of the employment contract, it remains a matter of construction which is a question of law.

30.  In any event, even if the decision of the tribunal officer on the point could be regarded as a finding of fact, that would have been an inference of fact rather than a finding of primary fact.  Under section 32(2)(a), the Court of First Instance may draw any inference of fact.

31.  Ultimately, even if it was a finding of primary fact and the judge was wrong to have regarded the matter as a matter of construction, that would not give rise to a question of general public importance.  The fact that the judge might have been wrong is not a reason for leave to appeal to be granted under section 35.  See: Sun Min v Hong Kong Ming Wah Shipping Co Ltd (unreported) 17 October 2005.

32.  The first question identified by Mr Lui does not arise at all.  Neither the tribunal nor the learned judge was of the view that any of the documents had been incorporated into the contract of employment.

33.  We are also not concerned with the second question.  The learned judge did not purport to reverse or vary a determination of fact made by the Labour Tribunal.  He came to his conclusion, rightly or wrongly, as a matter of construction of the employment contract, in particular clause 17.  Indeed, that was the approach commended to him by senior counsel then acting for the claimant.

34.  In the Hong Kong Civil Procedure 2007 at 59/14/16, there is the following passage:

“… In the interests of obviating multiplicity of hearings, delay and unnecessary costs, the Court of Appeal is very sparing in the exercise of the jurisdiction to set aside the grant of leave to appeal.  The court will not rescind leave to appeal (whether granted by a single judge on paper, or by at least two justices of appeal at an ex parte hearing) unless it is satisfied that the appeal will inevitably fail (see First Tokyo Index Trust Ltd v. Morgan Stanley Trust Co., The Times, October 6, 1995, CA, affirming the decision of the CA in The Iran Nabuvat [1990] 1 W.L.R. 1115; [1990] 3 All E.R. 9).  Accordingly, unless the respondent can point to a statutory provision, a binding authority or a factor overlooked by the single judge or by the justices of appeal which shows that the appeal cannot succeed, an application for leave to appeal to be set aside should not be made.”

35.  We are concerned with a case where leave to appeal should only be granted if a question of general public importance is involved.  Even so, we believe we should only interfere if we are satisfied that the single Justice of Appeal had overlooked the requirement of section 35A, or that it is not even reasonably arguable that a question of general public importance is involved.

36.  We believe it is possible that the learned Justice of Appeal might have overlooked the requirement of section 35A.  The affidavit in support was directed to the fact that the appeal was out of time and there was no attempt to set out or identify any question of general public importance in the draft Notice of Appeal or the affidavit.

37.  In any event, now that the questions which are said to be of general public importance have been identified, we can clearly see that those questions are not involved in the appeal.

38.  Leave to appeal to the Court of Appeal under section 35 should only be granted where the conditions in section 35A are satisfied, and the case is otherwise a suitable case for leave to be granted.

39.  It is important that employment disputes should be resolved quickly and inexpensively and it should not be thought that when a question of general public importance can be identified, leave to appeal would be automatic.  The court must also take into consideration all the circumstances including the question of possible hardship to the other party.  It would defeat the purpose of the Ordinance if the courts were to be too ready to give leave to appeal.