SINGH BALJIT v. FORWARD & CO. LAWYERS

HCA 552/2020

[2022] HKCFI 153

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 552 OF 2020

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BETWEEN

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D E C I S I O N

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Introduction

1.  The Plaintiff was employed by the Defendant for 2 periods. In the second period, the Plaintiff was allegedly dismissed by the Defendant without any reasons. The Plaintiff instituted this claim against the Defendant for various reliefs. The Defendant asserted that the claim was an employment claim and hence within the exclusive jurisdiction of the Labour Tribunal. The Plaintiff claimed that it was a mixed claim of employment law and tort law, with multi-issues that were not within the jurisdiction of the Labour Tribunal.

2.  Upon the application of the Defendant, Master Yee struck out the statement of claim in its entirety and dismissed that action on the ground that the claim was within the exclusive jurisdiction of the Labour Tribunal.

3.  This is the Plaintiff’s appeal against the Master’s decision. This kind of appeal operates as a rehearing. The Court hears the matter afresh.

4.  The summons for striking out taken out by the Defendant only mentions Order 18, rule 19 in the margin note without specifying which limb under rule 19(1) that the Defendant relies on. However, the Defendant’s supporting affirmation places reliance on rule 19(1)(a), (b) and (d), ie that the statement of claim discloses no reasonable cause of action, it is scandalous, frivolous or vexatious, and/or an abuse of the process of the Court. The grounds are that the claim is within the exclusive jurisdiction of the Labour Tribunal; there is no cause of action in tort and even if there is, the tort claims do not disclose a reasonable cause of action.

Legal principles on striking out

5.  Strike-out under Order 18, rule 19(1), RHC, is only used for plain and obvious cases. Disputed facts are taken in favour of the party whose pleading is the subject matter of the striking out application. Lack of jurisdiction can be a ground for striking out.

Legal principles on jurisdiction of the Labour Tribunal

6.  The principles have been set out in a recent decision of this Court in Woo Kwok Ping v The Incorporated Management Committee of Tsuen Wan Trade Association Primary School [2020] 1 HKLRD 717 §§17-23:

“17. The Labour Tribunal has exclusive jurisdiction over a claim for a sum of money, whether liquidated or unliquidated arising from, amongst others, (a) the breach of a term of a contract of employment, and (b) the failure to comply with the provisions of the Employment Ordinance.

18. Notwithstanding that, any claim in respect of a cause of action founded in tort, whether arising from a breach of contract or a breach of a duty imposed by a rule of common law or by any enactment falls outside the Labour Tribunal’s jurisdiction: Labour Tribunal Ordinance, Cap 25 (“LTO”) sections 7(1)-(2); §§1 and 3 to the Schedule.

19. In deciding the jurisdiction issue, the Court should look at both the pleaded causes of action and reliefs sought.

20. Mixed claims founded both in employment contracts and torts are excluded from the Labour Tribunal.

21. Similarly, a mixed claim for monetary and non-monetary reliefs, even though based on breach of contract or of the Employment Ordinance, fall outside the jurisdiction of the Labour Tribunal.

22. The proper approach of the Court is to look at the substance of the dispute and not the labels put on the pleadings. The Court should assess whether the other claims brought by the plaintiff are merely for “window dressing”, such that the real claim left is one that falls within the Labour Tribunal’s exclusive jurisdiction.

23. A distinction should be drawn between jurisdiction and forum for trial. Whether a claim falls within the jurisdiction of the Labour Tribunal is determined at the time the claim is filed. On the other hand, the forum for trial is determined at the time the issues are crystallized or when there are changes in circumstances after filing of the writ.”

Factual background

7.  The Defendant is a solicitor’s firm operated by a sole proprietor, Ms Viola Ho. She was admitted to practice in Hong Kong, Supreme Court of New South Wales and High Court of Australia.

8.  The Plaintiff claims that he was registered as a Registered Foreign Lawyer by the Law Society of Hong Kong during both periods of employment with the Defendant. He had to work under the supervision of a New South Wales solicitor for 2 years as a condition for obtaining a practising certificate issued by the Law Society of New South Wales as a trainee and to be registered as a Registered Foreign Lawyer with the Law Society of Hong Kong. Ms Ho was his supervising solicitor.

9.  The Plaintiff was employed by the Defendant twice without written employment contracts. The first period was from 22 January 2018 to 16 November 2018; the second from 1 March 2019 to 16 October 2019.

10.  The Plaintiff’s description of the nature of his employment contract vacillates among “trainee solicitor”, “apprentice” and “supervised Registered Foreign Lawyer” contract.

11.  On 16 October 2019, the Defendant terminated the Plaintiff’s second period of employment by a WhatsApp message. There were then about 8.5 months left of the Plaintiff supervision period.

12.  On 8 May 2020, the Plaintiff commenced the present action. The statement of claim is a convoluted set of pleading containing relevant and irrelevant facts, evidence, submission and law. It can be broadly divided into 4 sections:

■ §§1-12 – the background of each party; and the Plaintiff’s employment with the Defendant;

■ §§13-14 – dismissal of the Plaintiff without any reason given;

■ §§15-40 – mixed statements of law and fact surrounding termination which the Plaintiff says was unlawful; and

■ §§41-42 –assertion of suffering loss and damages to be assessed.

13.  In the prayer for relief, the Plaintiff seeks “general”, “punitive” and “actual damages, “loss of earnings”, “loss of future earning”, which are money claims. The rest are not reliefs but descriptive phrases ie “mental anguish”, “emotional distress”, “negligent infliction of emotional distress”, “loss of opportunity”, “intentional infliction of emotional distress”, emotional suffering”, “psychological distress”.

14.  The defence disputed the nature of the employment contract. The Defendant claims that the Plaintiff was a qualified solicitor admitted to practice in New South Wales. She had not terminated the Plaintiff’s employment but he had resigned. If he was terminated, it was for good cause.

Analyses

15.  Looking at the substance of the statement of claim, it is plain that the claim is premised on termination of employment. The core issues are (i) who terminated the employment; and (ii) if by the Defendant, whether it was for good cause. Issue (i) is on the Plaintiff, and issue (ii) is on the Defendant. If the Defendant cannot show good cause, then she has to pay salary in lieu of notice to the Plaintiff together with other appropriate statutory reliefs. The claim is within the exclusive jurisdiction of the Labour Tribunal, even if some of the damages arising from the termination are unliquidated: §17 of Woo Kwok Ping.

16.  The Plaintiff contends that it is a mixed claim in both employment and tort. There are also reliefs based on statutory provisions (eg MPF, Inland Revenue Ordinance and some Australian statutes), foreign law and complex issues that are not suitable for adjudication by the Labour Tribunal.

17.  For the following reasons, I reject the Plaintiff’s contentions.

18.  Firstly, it is clear from the prayers that the claim is a pure money claim, which does not seek any non-monetary reliefs.

19.  Secondly, a plaintiff cannot, by deploying phrases commonly used in tort in the prayer for relief, assert that he has a claim in tort. Each of those phrases, if intended to be a cause of action, must set out the relevant material facts in the body of the statement of claim. This is not done. The rambling assertions in the statement of claim purport to explain why the Plaintiff should not be terminated instead of asserting causes of action beyond wrongful dismissal.

20.  Thirdly, faced with a jurisdictional challenge, the Plaintiff describes his claim to be “conjointly of tort” in §2 of his Reply. He pleads various new matters to justify those claims in tort.

21.  It is trite law that a plaintiff must not put forward in his reply a new cause of action which is not raised either in the writ or the statement of claim. If the plaintiff, after seeing the defence, finds it necessary to rely on a cause of action which has not been raised in the writ or statement of claim, the proper way is to amend the writ and the statement of claim. See Hong Kong Civil Procedure 2022, Vol 1, §18/3/2, at p490.

22.  It is the statement of claim that the Defendant seeks to strike-out. The statement of claim has not been amended to plead tort.

23.  Fourthly, out of abundance of caution, I have considered whether some pleas might amount to claims in tort. They can be found in §§17, 19, 21, 35 and 37-39 of the statement of claim.

24.  With regard to bullying and harassment:

(1) §17 is in these terms:

“The Plaintiff understands that bullying and harassment are common amongst professionals, especially in the legal profession in Hong Kong. Usually after a campaign of bullying and harassment intended to make the target of bullying or harassment quit fails, such target is unfairly dismissed. The Plaintiff trainee lawyers including the Plaintiff is at high risk given they often cannot make complaints to the Law Society or take legal action for fear of damaging their reputation and making themselves un-employable. Nonetheless, the Plaintiff as a trainee should not be fired without serious justification such as fraud.”

(2) Harassment is an objective test: X v Z [2020] HKCFI 826, §15, Coleman J. It is ordinarily a course of conduct by a person by words or action directly or through third parties, sufficiently repetitive in nature that that person ought reasonably to know would cause worry, emotional distress or annoyance to another person. The mental element required is being reckless as to whether the victim would suffer injury from the conduct. Damage to the victim is necessary to constitute the complete tort: Secretary for Justice v persons unlawfully and wilfully conducting, etc [2019] 5 HKLRD 500, Coleman J.

(3) There is no reasonable cause of action disclosed as the Plaintiff has not pleaded that he had been bullied or harassed. Still less has the statement of claim pleaded repetitive words or action or otherwise met the legal test in sub-paragraph (2) above.

25.  With regard to breach of implied duty of trust and confidence:

(1) §19 of the statement of claim pleads that the Defendant had breached this duty “and then deprived the Plaintiff of any chance to persuade Ms Ho against the ‘folly’ of her actions”.

(2) There is no plea as to how the duty of trust and confidence could arise and be implied into the employment contract. There is no reasonable cause of action.

(3) In §21 of the statement of claim, the Plaintiff expressly pleads that:

“Ms Ho should not act in a way that does or is calculated to destroy the relationship of trust and confidence between herself and the Plaintiff, particularly in the context of a contemplated termination. … Since Ms Ho … breaches the duty of trust and confidence, the Plaintiff is justified in treating his contract as having been unlawfully breached, enabling the Plaintiff to claim constructive dismissal. Ms Ho may not go out of her way to destroy the Plaintiff’s career and reputation.”

(4) In §35 of the statement of claim, it is pleaded that “Hence, if an employer wants to dismiss an employee summarily, it must have sufficient justification and evidence.”

(5) These pleas make it plain that the so called breach of trust and confidence is about the cause of dismissal, a matter within the exclusive jurisdiction of the Labour Tribunal.

26.  In §§37-39 of the statement of claim, there appears to be a cause of action in negligence.

(1) §38 of the statement of claim purports to plead a duty of care:

“She had a legal obligation requiring adherence to a standard of reasonable care while performing any acts that could foreseeably harm the Plaintiff and his career, hence, Ms Ho was negligence and Ms Ho’s duty of care is non-delegable. Ms Ho had failed to fulfil her duty of care to act reasonably in respect of not acting in a reasonable manner to prevent the foreseeable harm to the Plaintiff.”

(2) The pleaded duty of Ms Ho is incomprehensible and is not backed up by authorities in the Plaintiff’s submission. No reasonable cause of action in negligence is disclosed.

27.  Looking at the substance of the statement of claim, it is plain that all the pleas are related to the claim in wrongful dismissal. There is no tort claim and even if terms usually appearing in tort claims have been used, there is no reasonable cause of action in tort.

28.  In summary, this claim concerns matters within the exclusive jurisdiction of the Labour Tribunal. The Court of First Instance lacks jurisdiction and that is incurable. This is sufficient to dismiss the appeal.

29.  I have read the submissions of both sides. The 82-page written submission of the Plaintiff is more convoluted and rambling than the statement of claim and seeks to defend his claims in “tort”. The contents would not affect the outcome of my decision.

Conclusion and costs

30.  The appeal should be dismissed. The Plaintiff conceded at the hearing that he should bear costs on dismissal of the appeal.

31.  The costs should be reduced to reflect the failure of the Defendant’s solicitors in complying with §8 of PD 14.3 in lodging and serving a costs statement with the skeleton submission of counsel. Costs for gathering information and drafting the statement of costs are generally not granted: §13 of PD 14.3. I summarily assess costs of the Defendant for this appeal to be $93,000.

32.  Unless the Defendant’s solicitors show cause in writing within 7 days of the handing down of this decision, the difference between the assessed costs and the amount on the costs statement is not recoverable from their client, or if already paid, should be refunded to their client.

33.  I thank Mr Poon for his assistance.