MURRAY ALAN GARDNER v. CATHAY PACIFIC AIRWAYS LTD.

HCA3390/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.3390 OF 2001

--------------

--------------

----------------

R U L I N G

----------------

1. I have before me two Summonses, the plaintiff's Summons for summary judgment under Order 14 and Order 14A and the defendant's Summons to strike out the plaintiff's claim herein.

2. The plaintiff is a commercial pilot employed by the defendant who operates an airline based in Hong Kong.

3. The plaintiff issued the Writ herein against the defendant on 27 July 2001 claiming for an injunction to restrain the defendant from implementing Rostering Practices 2001 or any other rostering practices not reached in accordance with the conditions in Section 22 of the Cathay Pacific Aircrew Conditions of Service (1999) ("1999 COS") and also a declaration that the defendant is not entitled to change rostering practices unless one of the conditions in Section 22 of the 1999 COS is met.

Background

4. In 1994, rostering practices for Aircrews of the defendant were governed by a written set of code entitled "Rostering Practices and Procedures for Cockpit Crew (1994)" ("RP94"). RP94 were incorporated into the Operations Manual of the defendant.

5. It is common grounds between the parties that between 1994 and 1999, RP94 had been amended unilaterally by the defendant from time to time by making amendments to its Operations Manual.

6. At all material times, the defendant contends that it had such right to amend rostering practices since between 1994 and 1999 it was a specific term of all contracts of employment between the defendant and its individual officers that :

"'These Conditions of Service shall be read in conjunction with the Operations Manual .... as the same may be amended from time to time' (Clause A2)

'An Officer travelling on Company Duty shall travel in accordance with the provisions in the Operating Manual Volume 1' (Clause C3)

'Rostering shall be in accordance with the Operations Manual Volume 1' (Clause C8)"

7. In 1999, proceedings were started in the High Court by a number of plaintiffs (of which the present plaintiff is one) being High Court Miscellaneous Proceedings No.1679 of 1999 ("HCMP1679/1999") against the present defendant in which the plaintiffs in that action contend that the provisions as to rostering are terms of an individual employee's Conditions of Service and that the defendant is not entitled to amend any of them without the specific agreement of the individual employees and that therefore the defendant is not entitled to amend unilaterally any provisions as to rostering by amending the Operations Manual.

8. The defendant on the other hand contended in HCMP1679/1999 that the provisions as to rostering are not themselves part of the Conditions of Service but are contained in and form part of the Airlines Operations Manual which is subject to amendment from time to time by the defendant unilaterally.

9. The dispute in HCMP1679/1999 has still not been finally determined by the Court.

10. Pending the resolution of that dispute in HCMP1679/1999, the 1999 COS which came into effect on 1 July 1999 specifically provided for Sections 1 and 22 as follows :-

"1 APPLICATION OF CONDITIONS

1.1 These Conditions of Service shall apply to Aircrew Officers ('Officers') employed by Cathay Pacific Airways Limited ('the Company').

1.2 These Conditions of Service shall be read in conjunction with the Operations Manual, Volume 1, as the same may be amended from time to time, subject to the provisions of Section 22.

...

22 ROSTERING

22.1 The Company and the Officer hereby agree and acknowledge that no agreement has been reached with regard to Rostering Practices and that the Company and that the Hong Kong Aircrew Officers' Association will continue negotiations with a view to reaching such agreement. The Company and the Officer further agree that rostering will continue to be in accordance with the Rostering Practices & Procedures for Cockpit Crew (1994) (to the extent applicable to an Aircrew Officer) pending further agreement on Rostering Practices or final resolution of HCMP No.1679 of 1999, whichever is the earlier. The Company and the Officer further acknowledge that the agreement of the Officer to the matters referred to in this clause is without prejudice to the assertions about Rostering Practices made by all the parties in HCMP No.1679 of 1999 and similar assertions made by the Hong Kong Aircrew Officers' Association."

The Plaintiff's Claim

11. On 19 July 2001, the defendant by letter to all its aircrew informed them that the defendant will be introducing changes to the rostering practices entitled "Rostering Practices 2001" ("RP2001") to take effect as from 1 August 2001.

12. Despite the objections from the plaintiff to the defendant directly and through his union, the Hong Kong Aircrew Officers Association ("HKAOA"), the defendant has effected such changes contained in RP2001 to the rostering practice as from 1 August 2001.

13. By so doing, the plaintiff claims that the defendant is in breach of Sections 1 and 22 of the 1999 COS, and claims for the injunction and declaration as stated above.

Plaintiff's Application for Summary Judgment

14. The application for summary judgment is brought under Order 14 and Order 14A of the Rules of the High Court. The plaintiff says that there is clearly no defence. Order 14A is invoked on the basis that as a matter of law, the clear construction to be put on Sections 1 and 22 of the 1999 COS when both sections are read together is that the defendant can only amend or change the rostering practice as it stood on 1 July 1999 either by further agreement with the HKAOA on rostering practices or through final resolution to HCMP1679/1999.

15. The plaintiff further submits that as this is a clear breach of a negative covenant, he is entitled to the injunction and declaration sought without the need to show that he has been adversely affected by such breach or that he has suffered loss or damage. Moreover that the injunction should be ordered to prevent the breach complained of.

The Defendant's Arguments

16. The plaintiff's application for summary judgement is opposed by the defendant.

17. Firstly, the defendant contends that the words "... rostering will continue to be in accordance with Rostering Practices and Procedure (1994)" in Section 22.1 of the 1999 COS cannot be intended by the parties to mean what it literally says because the word "continue" indicate quite clearly that the rostering practice which was being applied on 1 July 1999 (when the 1999 COS came into effect) was to continue, but that cannot be literally that which was contained in RP94 since between 1994 and 1999 RP94 had been amended from time to time.

18. The defendant therefore submits that it is at least arguable that those words can only be read to mean "... rostering will continue to be in substantial accordance with Rostering Practice and Procedure (1994)". In so submitting the defendant rely on the meaning given to the words "in accordance with" in Stroud's Judicial Dictionary, 6th ed. pp.215-6 emanating from the case of R. v. The Justices of the County of London [1890] 24 QBD 341 in which Matthew J held at p.345 that the words "in accordance with the plans" as used in Section 22 of the Licensing Acts 1874, ought to be read to mean "in substantial accordance with the plans".

19. Once that premiss is reached, the defendant submits that such amendments as had been made to RP94 between 1994 and 1999 were not substantive amendments and therefore the position as to rostering on 1 July 1999 were still in substantial accordance with RP94. In like manner therefore, the defendant was not prevented by Section 22.1 from continuing to make amendments to RP94 after 1 July 1999 as long as the amendments were not substantial and that the rostering practices remained "in substantial accordance" with RP94.

20. That says the defendant is the proper construction to be put on Section 22.1 of the 1999 COS. In further support of that being the proper construction to be put on those words, leading counsel for the defendant points out that it is only if that is the proper construction that the third sentence of Section 22.1 would make sense for the parties to agree that by so agreeing, it is without prejudice to their respective assertions made in HCMP1679/1999.

21. Upon that construction, the defendant says it is well entitled to introduce RP2001 as those changes to the rostering practices therein are substantially in accordance with RP94.

22. Secondly, the defendant submits that in determining the proper construction of the words in Section 22.1 of the 1999 COS, the Court must have regard to the matrix of fact which can have a bearing on such construction. Here that matrix of fact will include matters such as :-

(a) what are the amendments made to RP94 between 1994 and 1999 and whether they are substantial amendments or not; and

(b) whether the amendments in RP2001 are substantial amendments or not.

23. Thirdly, it was submitted by the defendant that in making the claim that the plaintiff did, the plaintiff had confused between rostering practice and flight time limitation scheme. In this respect when the plaintiff complains that manning level on certain flights have been reduced from 4-men crew to 3-men crew, this, according to the defendant, has nothing to do with rostering but is in fact a change to the flight time limitation scheme which resulted from changes effected by the Civil Aviation Department and which became effective as from 1 March 2001.

24. That is a matter which the plaintiff disputes and as such is a disputed issue of fact between them. However, the significance of this issue does not touch on the issue of construction. It affects only the plaintiff's claim to have been affected by such changes and therefore the question whether such changes were changes of the rostering practice as claimed by the plaintiff, or whether they were changes to the flight time limitation scheme as advocated by the defendant.

Decision

25. To grant summary judgment, a court must be sure that there is no defence to the plaintiff's claim. It must follow therefore that when a court is asked to give summary judgment on a point of law under Order 14A, the point of law being the construction of a document, the court must equally be sure that the construction contended for by the plaintiff is not only the proper construction but that it is not open to another possible construction.

26. In the present case, both parties agreed that a literal construction of Section 22.1 of the 1999 COS would put the parties back to the position in 1994 in so far as rostering is concerned. Equally both parties accept that is not the intention of the parties.

27. While there is a lot to be said for the construction urged upon me by the plaintiff, I am unable to say that the construction suggested by the defendant is so clearly unarguable that I can disregard it offhand. In so saying I am conscious that in such an application as this, the defendant need only to show that the construction contended for by it is an arguable one at trial and that would be sufficient to prevent summary judgment being ordered and for the matter to proceed to trial. That is all the more so when the construction contended for by the defendant is such that it would require the Court to consider disputed issues of fact in order to determine the matrix of fact before it could come to a final resolution of the dispute between the parties.

28. Quite apart from the above, there are also disputed issues of fact which would need to be resolved in order to determine whether and to what extent the plaintiff had been affected by the alleged breach of the defendant. That would be necessary to decide what relief the plaintiff would be entitled to, in particular whether the injunction sought should be granted. Therefore even if the question of law as to construction could be determined, it would still not be possible to dispose of this matter in its entirety here.

The Application to Strike Out

29. This application is brought on the basis that the plaintiff had suffered no loss or damage and therefore his claim should be dismissed.

30. In the midst of his submission, leading counsel for the defendant indicated that he would not be pressing hard for this application to strike out the claim because a part of his submission in respect of the plaintiff's application for summary judgment involved submitting that the plaintiff's claim should proceed to trial which, no doubt, appeared to cut into his application for striking out. Without making any concessions, he saw fit to leave the matter to the Court.

31. In any event, the issue whether or not the plaintiff had suffered any loss or damage now appears to be based on disputed factual issues as already referred to above.

Conclusion

32. In the circumstances, and for the reasons given, in respect of the plaintiff's application for summary judgment, there will be an order that unconditional leave is given to the defendant to defend.

33. The defendant's application for striking out is dismissed.

Costs

34. There will be the following costs orders nisi :-

(a) costs of the application for summary judgment be costs in the cause; and

(b) costs of the defendant's application for striking out be to the plaintiff in any event.