KEUNG MEI LAN v. POKFULAM DEVELOPMENT CO LTD AND ANOTHER

DCEC938/2018

[2020] HKDC 801

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 938 OF 2018

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D E C I S I O N

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1.  This is an application by the Applicant to join Pokfulam Property Management Limited (“PPML”) as the 3^rd Respondent in the proceedings notwithstanding that it is time barred.

2.  There was no dispute that this application was made late: the limitation period has expired on 24 June 2018 but the current application was taken out more than 16 months later on 5 November 2019.

Background and chronology

3.  This is an employees’ compensation claim: the Applicant was a lifeguard and alleged that, on 24 June 2016, a male person entered the changing room whilst she was getting dressed and she suffered psychiatric illness as a result.

4.  On 28 April 2018, the Applicant, acting in person, took out these EC proceedings against the 1^st Respondent.

5.  On 21 August 2018, the 1^st Respondent filed and served an Answer denying that it was the employer of the Applicant or the principal contractor, and stated that Sunny Recreation Management Limited (“SRML”) was the employer (hearing bundle p.36).

6.  On 23 August 2018, Kenneth Lam Solicitors (“KLS”) filed a Notice to Act to represent the Applicant (hearing bundle pp.42-45).

7.  On 13 September 2018, the solicitors acting for the 1^st Respondent, CW Lawyers (“CWL”) wrote to KLS reiterating the denial that it was the Applicant’s employer and demanded that the claim be discontinued. CWL also asked for a copy of the Form 2 for consideration.

8.  Legal Aid was granted on 5 December 2018 and KLS continued to act for the Applicant.

9.  On 20 December 2018, KLS replied to CWL enclosing a Form 2 dated 20 February 2018 and an Amended Form 2 dated 5 September 2018 (hearing bundle pp.225-231):

i)  The Form 2 stated someone called “Loi Gor” as the employer and SRML as the principal contractor.

ii)  The Amended Form 2 was altered in that, amongst others, the letters “ER:” (the meaning of which is not explained but Mr. Lau, Counsel for PPML, suggested that it meant “employer”) was added before SRML and, more importantly, the name of PPML and its English and Chinese form was added next to the box for “principal contractor”.

10.  On the same day, KLS took out an application to join SRML as the 2^nd Respondent (with consequential directions) out of time (hearing bundle pp.75-77). No application was made against PPML. The order was granted on 28 January 2019 (hearing bundle pp. 79-81).

11.  On 4 October 2019, the 1^st Respondent filed and served a List of Documents which disclosed, amongst others, a service contract between SRML and PPML dated 7 April 2016 (the “Service Contract”).

12.  On 30 October 2019, the Applicant discontinued its claim against the 1^st Respondent.

13.  The current application was taken out on 5 November 2019.

The legal principles

14.  Section 14(4) of the Employees’ Compensation Ordinance, Cap. 282 allows the Court’s discretion to extend the limitation period for EC application beyond 24 months if “there was reasonable excuse for the failure so to give notice or to make an application”.

15.  It is trite as to what constitutes “reasonable excuse”. Cheung JA stated in the Court of Appeal case of Tsang Loi Fat v Sun Fook Kong [2011] 4 HKLRD 344:

“When the Court rules on whether there is a reasonable excuse…apart from considering the reason for the delay, it also has to consider the length of the delay, whether there is sufficient ground to support an award of employees’ compensation to the applicant, and whether prejudice would be caused to the interests of the respondent if an extension of time is granted by the Court…The longer the delay, the more the applicant has to prove that his claim has an extremely high chance of success.”

The Applicant’s case

16.  The Applicant’s explanation of the delay is that she has made the application at the time when she was not represented. She has mistakenly thought that the 1^st Respondent was the management company of the swimming pool facilities because it shared the same office address as PPML. She also had some psychiatric problems and made the application in a hurry after being told by the Department of Legal Aid of the impending limitation period (see paragraphs 8, 12, 13 and 14 of the Applicant’s 1^st Affirmation, hearing bundle pp.131-132).

17.  She further explained in the 2^nd Affirmation that she has misunderstood that as the accident happened on the property of the 1^st Respondent, the 1^st Respondent should be the management company. She also mentioned that she was taking various psychiatric medications around that time. (see paragraph 3 and 4 of hearing bundle p.150)

18.  However, all these are the Applicant’s explanation as to why she has named the 1^st Respondent when she first applied for the EC claim in around April 2018.

19.  As to why the Applicant took out the current application at the time that she did, the only explanation provided was that she only realised her mistake when the Service Contract was disclosed by the 1^st Respondent on 9 October 2019 (see paragraph 15, hearing bundle p.133)

20.  Even if one accepted that the Applicant has mistakenly mixed up the 1^st Respondent with PPML initially on her own, there is a complete lack of explanation as to the 10 months’ delay between 20 December 2018 (the latest possible date that the Former Solicitors must have received the Amended Form 2) and 9 October 2019 when the Service Contract was disclosed.

21.  The Applicant was represented by the Former Solicitors during this period and self-evidently, the Former Solicitors took out the decision to apply to join SRML but not PPML on 20 December 2018 despite seeing both names on the Amended Form 2.

22.  When asked by the Court, Mr. Wong, Counsel for the Applicant, attempted to explain that the Applicant (and presumably the Former Solicitors) were “confused” at the time: PPML was named in the Amended Form 2 but not in the Answer and Amended Answer, so the Applicant needed to be “careful” to wait for “cogent evidence” before taking out any joinder application.

23.  Mr. Wong also explained that since this was after the proceedings had commenced, any joinder application would incur costs. If PPML was mentioned by the 1^st Respondent earlier in the Answer, there would be time for investigation.

24.  I do not accept such arguments.

25.  Firstly, none of these “confusion” and “careful cost considerations” etc. was ever mentioned in any affirmations so Mr. Wong was obviously attempting give evidence from the bench.

26.  Further, as mentioned above, the Former Solicitors clearly made the decision to join SRML only despite having also the name of PPML before them.

27.  And, importantly, if there was any “confusion” as alleged, the “careful” way forward should not be passive inaction, but would be to immediately launch an investigation to inquire as to the role of PPML, and to make the application as early as possible knowing that even the application to join the SRML was already late. Mr. Wong agreed with the Court that this would have been his advice if he was instructed then.

28.  To give the “starting date” as December 2018 was being generous, the actual period of inaction would likely be longer:

i)  the Amended Form 2 contained an acknowledge of receipt chop by the Labour Department dated 5 September 2018 so the Former Solicitors must have received it between this date and 20 December 2018 when they disclosed it to CWL.

ii)  Further, when a district councilor wrote a letter of complaint on behalf of the Applicant to the 1^st Respondent on 8 February 2017, the reply letter was written by PPML (hearing bundle p.218) on 24 February 2017. In this letter, PPML took on disputing the facts of the complaint. One would expect that if PPML took the position that it was not the management company of the swimming facilities, it would have stated so and would have no locus standi to dispute such facts. Thus it is arguable that a reasonably prudent person or her solicitors would have been alerted to the identity of the management company (and thus the principal contractor) as early as February 2017.

29.  Although PPML has not raised any evidence of prejudice caused by this delay, I also note that a protective writ has been issued for common law negligence so there is no suggestion the Applicant’s claim against PPML may otherwise be extinguished. One must further consider that some redress may be directed towards the Former Solicitors if the delay was indeed made under the circumstances as suggested by Mr. Wong.

Conclusion

30.  Having considered all the circumstances of the case, I find that there is no reasonable excuse for the delay and would dismiss the application with costs to the Intended 3^rd Respondent, with certificate for counsel. If no agreement can be reached regarding costs, the Intended 3^rd Respondent shall serve and lodge a summary bill of costs within 28 days of this decision. The Applicant shall serve and lodge a list of objections 14 days thereafter. The costs shall thereafter be assessed summarily on paper.