HO SIU MEI v. SOLUTION HOUSE LTD.

IN THE COURT OF APPEAL

1997, No. 5

(Small Claims Appeal)

________________

________________

________________

J U D G M E N T

________________

Godfrey, J.A. :

Introduction

1. We have before us an application for review of a decision by the Small Claims Tribunal to transfer the claim of the claimant, Ho Siu Mei ("the claimant") against Solution House Ltd ("the respondent") to the District Court. The claimant objects to this transfer. The respondent supports it. We have to decide whether or not to uphold the decision of the tribunal.

The statutory background

2. Before dealing with the merits or otherwise of the tribunal's decision, I must briefly describe the jurisdiction of the tribunal, and in particular its jurisdiction to transfer a claim before it to the District Court.

3. The Small Claims Tribunal, as its name suggests, has been constituted by the legislature (see the Small Claims Tribunal Ordinance, Cap. 338) for dealing with small claims. The intention of the legislature was to provide a procedure for the speedy and inexpensive resolution of small claims. The cost of court proceedings, and the time that it takes to resolve them, are a deterrent to the prosecution of small claims.

4. The Ordinance accordingly confers upon the tribunal thereby constituted jurisdiction to hear and determine such claims as are specified in the Schedule to that Ordinance. These include (see para. 1) :

"any monetary claim founded in contract, quasi-contract or tort where the amount claimed is not more than $15,000, whether on balance of account or otherwise".

5. Section 7 of the Ordinance provides as follows :

"7. Transfer of claims

The Tribunal may at any stage of proceedings in the tribunal, either of its own motion or upon the application of any party, transfer the proceedings to the District Court or the High Court, whereupon the practice and procedure of the District Court or the High Court, as the case may be, shall apply."

6. The legislature, plainly concerned that a decision as to transfer made by the tribunal should not be final, provided by s.27 of the Ordinance as follows :-

"27. Review of decision concerning transfer

(1) Where the tribunal has under section 7 transferred a claim to the District Court or the High Court, the Court of Appeal may, within 14 days from the date on which the tribunal transferred the claim, review the tribunal's decision and on such review it may -

(a) confirm the decision of the tribunal or remit the claim to the tribunal; and

(b) make such order as to costs and expenses as it thinks fit.

(2) The power conferred by subsection (1) may be exercised, on the application of a party, within 7 days of the date on which the tribunal transferred the claim, no notice in the prescribed form to all other parties."

7. Any decision to transfer a claim to the District Court must be supported by "some good and sufficient reason"; see for this proposition Chapman v. Thai Airways International Limited (an unreported decision of this court) where Bokhary, J.A., on 1 March 1995, said this :

"..... when a small claim is excluded from the very tribunal set up to deal with such claims, there has to be some good and sufficient reason for that course."

What is a "good and sufficient reason"?

8. Section 7 (see above) is expressed in quite general terms. The legislature has given no guidance as to what cases may or may not be suitable for such transfer; but I would venture to suggest that only where it is necessary in the interests of justice will an order for transfer be justified. In a case where the issues are complicated, and where the case cannot be decided without the reception of independent expert evidence on both sides, it may be proper for the tribunal to come to the conclusion that there is good and sufficient reason for such a transfer. But such cases will be rare indeed.

The power of review

9. As I have already mentioned, the legislature has, by s.27 of the Ordinance, conferred upon this court a power of review of the tribunal's decision. I apprehend that this power enables this court to look at the whole matter afresh, and to decide whether or not the power conferred on the tribunal under s.7 ought in the particular case to have been exercised in favour of a transfer.

The facts

10. I turn to the facts of this case.

11. The claim is for $11,000. It arises under a contract for services made in writing on 10 May 1996 between the claimant and the respondent. The scope of the work (to be done for a customer of the respondent, Liton Electronic Co.) is described in the contract as follows :

"Develop an Inventory and Import/Export Declaration System for Liton Electronic Co. Ltd. with FoxPro 2.6 under Novell Netware 3.12."

12. Payment under the contract was to be made "when Liton Electronic Co. Ltd. is formally accepted your work".

13. There is no doubt that the claimant embarked on the work; but it has not been accepted. The dispute between the parties is as to whether the claimant satisfactorily completed the work she was engaged to do. This raises a question as to the scope of the work. The claimant asserts that she was required to produce the system mentioned in the contract, but that the maintenance or backup services which it would require when in operation lay outside the scope of the work. The respondent asserts that it was within the scope of the work to provide for such maintenance or backup services; and that the claimant (as indeed she accepts) has not done so.

14. The adjudicator who dealt with the case was exercised by considerations such as I have briefly mentioned above. He felt that some at any rate of the issues between the parties could not be properly formulated, let alone resolved, without a consideration of expert evidence which would be of such a scope and nature that formal court proceedings were needed in order to limit and identify the technical issues in advance of the trial.

15. Accordingly, he came down in favour of exercising the power of transfer conferred by s.7 of the Ordinance.

Conclusion

16. We, in this court, have to consider whether the reasons given by the adjudicator are indeed "good and sufficient reasons" for the tribunal's decision to transfer the case to the District Court.

17. Speaking for myself, I am of the opinion that they are insufficient. The primary consideration, as it seems to me, is that the Small Claims Tribunal was constituted to deal with small claims (and this is a small claim) in a comparatively speedy and inexpensive way. It is always possible to exaggerate the complexity of a case in order to achieve perfect justice. But justice is never perfect; and it is often better that it should be speedily and inexpensively dispensed than that it should be achieved only after years of expensive litigation. Even in the case of so simple a matter as an alleged defect in a pair of shoes (the sort of thing for which the Small Claims Tribunal might well be thought to be particularly appropriate) there might be questions as to whether the leather used in the making of the shoes was of a suitable quality; whether the stitching was done properly; whether the dye used was of the right quality, and so on. It could take weeks to try, with expert evidence, the question whether or not a pair of shoes was, or was not, of merchantable quality. But nobody would expect, or indeed permit, any such thing to happen.

18. For my part, I see no good reason to adopt a different approach to this small claim, for $11,000, in respect of the services to be provided here by the claimant to the respondent. I think the tribunal should grasp the nettle and get on with determining the case as best it can.

19. It may be, as was represented to us, that that it is difficult to test the respective merits of the parties' cases without demonstrating the utility or otherwise of the claimant's work on some form of local area network. If that be so, there is no reason why, with the agreement of the parties, the adjudicator should not go to the respondent's premises (or to the premises of its customer where it is or was intended to use the claimant's work) and see for himself just how well or badly it has shaped up.

20. For these reasons, I would, for my part, refuse to confirm, on this review, the decision of the adjudicator, and, pursuant to s.27, I would remit the claim back to the Tribunal for adjudication.

Liu, JA:

21. The evidence of witnesses of technical matters, if contradictory in nature, has to be accepted, rejected or preferred on the usual balance of probabilities. Expert evidence, when fully or sufficiently understood, would enable a court/tribunal to test the accuracy of the facts and opinions deposed to and form its own independent judgement on that basis, but come what may a court/tribunal is enjoined to grapple with and take a stand on the evidence available at the conclusion of the proceedings. If the courts/tribunals are not ready to do so, an uncontrollable proliferation of specialised tribunals cannot be avoided. Judicial officers have had to become proficient in weighing competing technical evidence.

22. The system designed by the appellant was supplied for a relatively modest sum. No admission is made by either of the parties that their respective witness was unable or even, be it noted, found it difficult to explain the technical aspects involved. No independent expert evidence was sought to be called. The adjudicator would simply have to deal with the evidence with his usual judicial proficiency. I agree that there was insufficient ground for making the order of transfer.

Litton, V-P :

23. I agree for the reasons given by Godfrey, J.A. that the appeal must be allowed.

24. The result is that the Adjudicator's order for transfer, as confirmed on review, is discharged and the claim is remitted to the Small Claims Tribunal for adjudication.