CHOY HIU LING v. NEW WORLD HARBOUR VIEW HOTEL

CACV 410/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 410 OF 2000

(ON APPEAL FROM EMPLOYEES' COMPENSATION
CASE NO. 183 OF 2000)

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REASONS FOR JUDGMENT

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Keith JA (giving the first judgment at the invitation of Rogers V-P):

Introduction

1. Persons who are injured at work are entitled to be compensated by their employers without the need to prove negligence or breach of statutory duty. Proceedings may be issued to obtain such compensation. In addition, the Commissioner of Labour ("the Commissioner") has the power to assess the amount of compensation due. This appeal concerns the inter-relationship between these two routes to secure compensation. At the conclusion of the hearing of the appeal, the appeal was dismissed, but the parties were told that the court's reasons would be reduced to writing. This judgment represents my reasons for agreeing that the appeal should be dismissed. All references in this judgment to sections of an ordinance are references to sections of the Employees' Compensation Ordinance (Cap. 282) ("the Ordinance").

The facts

2. The Appellant, Choy Hiu Ling, was employed at the New World Harbour View Hotel by the Respondent ("the hotel"). She claims to have suffered an injury to her left hand at work on 30 September 1993. In August 1996, she commenced proceedings against the hotel in the District Court for compensation under the Ordinance pursuant to section 18A(1), which provides that if proceedings are issued to obtain such compensation they can only be commenced in, and determined by, the District Court. On 18 September 1999, those proceedings were dismissed for want of prosecution. There was no appeal from that order.

3. Some claims for compensation under the Ordinance can be assessed by the Commissioner. One such claim is a claim for compensation in respect of an injury which results in a loss of earning capacity: see section 16A(1)(b). Where the Commissioner believes that an injury is likely to result in permanent incapacity, he may refer the claim for compensation to the Employees' Compensation (Ordinary Assessment) Board ("the Board"): see section 16D(4). On such a reference, the Board is required to assess (a) the extent of the loss of earning capacity and (b) the period of absence from work as a result of the injury, and then issue a certificate to that effect: see sections 16D(5) and 16F. It should be noted that the Board does not assess the compensation: it merely decides two discrete components on which the amount of compensation is ultimately to be based.

4. While Madam Choy's claim for compensation was proceeding in the District Court, the Commissioner referred her claim to the Board. That did not necessarily mean that he was intending to exercise his power under section 16A(1)(b) to assess her compensation himself. It was open to the Commissioner to refer her claim to the Board so that the two components which came within its remit could be assessed by the Board either for use by the Commissioner if he assessed the compensation himself or for use by the District Court if that was where the compensation was to be assessed. That follows from section 16H which provides that a certificate issued by the Board under section 16F shall be admitted in evidence in any court and shall be evidence of the matters stated in it.

5. In due course, the Board assessed Madam Choy's permanent loss of earning capacity which had been caused by her injury at 10%. Madam Choy was dissatisfied with that assessment, and requested the Board to review the assessment. On that review, the Board increased the assessment to 42%. On 3 September 1999, the Board issued a certificate to that effect.

6. An appeal from such an assessment lies to the District Court: see section 18(1). Madam Choy filed such an appeal. Her notice of appeal originally sought compensation for her injury as well, but that claim was abandoned, and her appeal was limited to challenging the revised assessment. The hotel then applied for the appeal to be struck out on the ground that the appeal was an abuse of the court's process. The application to strike out the appeal was heard by Judge Yung. He ordered that the appeal be struck out, and Madam Choy now appeals to the Court of Appeal against the striking out of her appeal to the District Court.

The Commissioner's power to assess Madam Choy's compensation

7. As I have said, the assessment by the Board of Madam Choy's loss of earning capacity was for the purpose of determining two discrete components in the assessment of her compensation. Those two components in her compensation cease to matter if her claim for compensation for the injury which was said to have caused that loss of earning capacity cannot be pursued. It can no longer be pursued in the District Court because the proceedings in the District Court have been dismissed. Accordingly, the extent of Madam Choy's loss of earning capacity would only still be relevant, and an appeal from the Board's revised assessment would only have some purpose, if it was still open to the Commissioner to assess Madam Choy's compensation under section 16A(1).

8. The Commissioner is said no longer to have the power to assess Madam Choy's compensation under section 16A(1) because of section 16A(1A) which provides:

"Compensation shall not be assessed by the Commissioner under subsection (1) unless claim for compensation arises within 24 months after the happening of the accident."

Both Ms Josephine Pinto for Madam Choy and Mr Anthony Ismail for the hotel asserted that the "claim for compensation arises" when the Commissioner is notified of the accident which gave rise to the claim for compensation, pursuant to the requirement to notify him of such an accident contained in section 15. The documents show that the earliest date on which the Commissioner was notified of the accident was in April 1996. Thus, on this construction of section 16A(1A), since the Commissioner had not been notified of the accident by 30 September 1995 (i.e. within 24 months after the accident), and since there is no power for the time limit in section 16A(1A) to be extended, the Commissioner would no longer have the power to assess Madam Choy's compensation.

9. I digress for one moment to add that the hotel admits that it did not notify the Commissioner of the accident. The obligation in 1993 on an employer to notify the Commissioner of an accident to one of its employees which did not result in the employee's death only arose in the event of the employee's "total or partial incapacity ... for a period exceeding 3 consecutive days immediately following the accident": see section 15(1A) in its then form. Although Madam Choy claims (and has been assumed) to have a loss of earning capacity, she never alleged that her injury caused her to be absent from work. I do not, of course, decide whether that meant that the accident did not result in her total or partial incapacity within the meaning of section 15(1A). I merely note that this is the hotel's justification for not reporting the accident to the Commissioner.

10. Returning to section 16A(1A), I am by no means persuaded that the construction placed by Ms Pinto and Mr Ismail on section 16A(1A) is correct. If, as they presumably contend, the word "arises" means "is made", why cannot the claim for compensation be said to arise when the employer (rather than the Commissioner) is notified of the accident which gave rise to the claim for compensation, pursuant to the requirement on the employee to notify the employer of such an accident contained in section 14? If that is the correct construction of section 16A(1A), the Commissioner would still have the power to assess Madam Choy's compensation, because her case is (and I do not think that it has ever been disputed) that she reported the accident to her supervisor immediately and to her manager in November 1993 (i.e. within two months of the accident). Alternatively, the proper construction of the words "claim for compensation arises" in section 16A(1A) could be that such a claim arises when the employee realises that the accident caused an injury of a kind for which compensation under the Ordinance was payable.

Serving a useful purpose

11. However, I do not think that the difficult question as to the proper construction of section 16A(1A) needs to be addressed, since apart from section 16A(1A) the assessment of compensation by the Commissioner under section 16A(1) would serve no useful purpose. That is because there is an important issue in the case as to whether Madam Choy's injury was caused in the course of her employment. If it was not, compensation under the Ordinance would not be payable: see section 5(1). Both Ms Pinto and Mr Ismail contended that the Commissioner could not determine that issue. I agree. That was the view of the Court of Appeal in Ng Ming Cheong v. Mass Transit Railway Corp. [1997] HKLRD 1231. In giving the judgment of the court, Le Pichon J (as she then was) described the statutory framework which enabled the Commissioner to assess compensation, and continued at p. 1234I-J:

"The purpose of such a comprehensive procedure is obvious. If liability is indisputable or admitted, the parties need not go through the expensive and time-consuming court process for an assessment. The Ordinary or Special Assessment Boards would decide for the parties the extent of disability according to certain well set-out criteria including the First Schedule to the Ordinance. The assessment would form the basis for the calculation of compensation. If the assessment is also acceptable to the parties, the amount of compensation can easily be worked out and the employee's claim expeditiously settled."

She continued at p. 1235F:

"It is the clear intention of the legislation that the District Court is the forum to contest liability where this is disputed."

12. I do not comment on whether the fact that there is a dispute as to liability would in the normal run of cases prevent the Commissioner from assessing compensation, subject to the resolution by the District Court of the dispute as to liability. Assuming (but without deciding) that that would be a permissible course for the Commissioner to take, it would not be a permissible course in the present case. That is because the dismissal of the proceedings in the District Court (albeit without a consideration of the underlying merits) has prevented the dispute as to liability from being determined. If it cannot be determined, the assessment of compensation by the Commissioner would serve no useful purpose.

The section 18(3) argument

13. It was to overcome this hurdle that Ms Pinto mounted a spirited argument based on section 18(3). I have already referred to section 18(1) which provides for appeals from assessments made by the Board to the District Court. In order to put the argument based on section 18(3) in its context, it is necessary to set out section 18(1) in full. It reads:

"Subject to this section, an appeal shall lie to the District Court from any decision or assessment of the Commissioner, an Ordinary Assessment Board or a Special Assessment Board under section 16A, 16D, 16E, 16G or 16GA."

Thus, section 18(1) permits an appeal to the District Court, not merely from an assessment by the Board under section 16D(5), but also from an assessment of compensation by the Commissioner under section 16A(1). Against that background, section 18(3) reads:

"On an appeal under this section, the Court may confirm or reverse any decision, or confirm or vary any assessment, of the Commissioner, an Ordinary Assessment Board or a Special Assessment Board, or may substitute its own assessment, and may determine the amount of compensation payable and may make such order in respect thereof, including any order as to costs, as it thinks fit." (Emphasis supplied)

Ms Pinto relied on the power conferred on the District Court by section 18(3) to "determine the amount of compensation payable". Since the amount of the compensation payable to Madam Choy depends on the extent of her loss of earning capacity, the appeal against the revised assessment is highly relevant.

14. I accept that any appeal against the revised assessment is highly relevant to Madam Choy's ultimate compensation, but I do not think that the District Court had the power to determine the amount of compensation on Madam Choy's current appeal under section 18(1). That is because I construe the District Court's power to determine compensation under section 18(3) as arising only where there has been an assessment of compensation by the Commissioner under section 16A(1). The District Court can substitute its own assessment of the extent to which the employee has lost earning capacity for that of the Board, and it can assess compensation itself when the Commissioner has assessed compensation. But in the light of section 18(1), section 18(3) cannot be read as conferring the power on the District Court to assess compensation where the Commissioner has not assessed it himself.

15. Moreover, if one of the purposes of section 18(1) is to provide for an appeal against an assessment for compensation by the Commissioner under section 16A(1), and if the Commissioner cannot assess compensation under section 16A(1) if there is a dispute as to liability, the fact that liability is disputed would prevent the District Court from determining the amount of compensation under section 18(3). Finally, the District Court would not have been able to determine the amount of compensation in the present case because the claim for compensation in the notice of appeal to the District Court had been abandoned. Accordingly, the reliance placed on the words "may determine the amount of compensation payable" in section 18(3) is misconceived.

Conclusion

16. It was for these reasons that I agreed that this appeal had to be dismissed. But I cannot depart from this case without expressing some sympathy for Madam Choy. If the original proceedings in the District Court had not been dismissed for want of prosecution, there would have been no need for an attempt to be made to bring her case within the narrow confines of section 18. Having read the reasons for the judge's view that those proceedings should be dismissed for want of prosecution, I note that there was very little delay, if any, which could have been attributed to Madam Choy personally. Since there was no appeal from the dismissal of the original action for want of prosecution, it would not be right for me to comment on whether the action should have been dismissed. I merely comment that it is regrettable that Madam Choy finds herself in her current predicament for reasons which have little, if anything, to do with conduct on her part for which she can fairly be criticised.

Le Pichon JA:

17. I agree with the reasons given by Keith JA for dismissing this appeal and the additional observations made by Rogers V-P.

Rogers V-P:

18. I agree that this appeal had to be dismissed for the reasons given by Keith JA. In so saying I wish to emphasise two points.

19. The first is in relation to the observations made in relation to Madam Choy's predicament. It would appear that Madam Choy's perseverance despite her injury and her tolerance of the delays in respect of her claim have led in the end to a denial of a hearing on the merits. Regrettably, it would appear to be beyond the power of this court to rectify the matter.

20. The words "... claim for compensation arises ...", as they appear in Section 16A(1A) of the Ordinance, raise considerable difficulty. This may, in part, arise because the Ordinance has been amended on a number of occasions and, indeed, the scheme of the Ordinance has, to an extent, been changed. The correct meaning of these words is a matter that will fall to be decided in another case. In view of the fact that there was not full argument on the matter I wish to say no more than that the possible meanings that have been set out in Keith JA's judgment are not exhaustive. An additional interpretation may be that a "claim for compensation arises" when a claim is made to the employer.

21. In the circumstances, the appeal was dismissed with an order that the costs of the appeal would be to the respondent.