LAU SUET FUNG v. FUTURE ENGINEERING CO

CACV 110 of 2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 110 OF 2003

(ON APPEAL FROM EMPLOYEES' COMPENSATION
CASE NO. DCEC 649 of 2002)

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JUDGMENT

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Hon Yeung JA:

1. I agree with the judgment of Yuen JA. I too would make the orders set out in paragraph 74 hereof.

Hon Yuen JA:

2. This is the Applicant's appeal from a decision of District Judge C.B. Chan in which she dismissed his applications

(I) under s.14(4) of the Employees' Compensation Ordinance cap. 282 ("ECO") that the Court receive his application for compensation under s.18A ECO, notwithstanding that the application had not been made in due time as required under s.14(1) ECO,

and further or alternatively,

(ii) for an order that a Certificate of Compensation Assessment issued by the Commissioner of Labour under s.16A ECO be cancelled as it had been issued in ignorance of, or under a mistake as to, the true nature or the extent of the injury, and for this purpose, that the time prescribed under s.16B(2) ECO for making such an application for cancellation be extended.

3. The appeal raises some interesting issues on the present statutory regime governing employees' compensation, as well as employees' applications for extensions of time to make claims for compensation when the full extent of injuries are not readily apparent until some time after the accidents.

Facts

4. It is necessary for the purposes of this judgment to recount the following facts. On 23 September 1998, the Applicant (whom I shall refer to as "the Employee", although he left the Respondent's employment in March 2000) suffered an injury to his left eye in the course of work, when the cover of a pressure gauge sprang up and hit him on the face, causing his spectacles to be broken, piercing his eye. He notified the Respondent ("the Employer") of the accident on the same day.

Hospital

5. The Employee was first sent to the Accidents and Emergency Unit of a public hospital where he was treated for what was described simply as an "eye injury". He was recommended sick leave for 2 days.

General Practitioner

6. Two days later, he went to a private general practitioner near his home. This doctor, Dr Hui, gave a diagnosis of "left eye injury" and recommended sick leave for 7 days.

First specialist

7. Before this period of sick leave expired, the Employee felt that there was some blurring in the vision of his eye and consulted an ophthalmologist, Dr Chan on 30 September 1998. Dr Chan recommended sick leave for 4 days.

Second specialist

8. On 5 October 1998, the Employee went to a specialist practice of ophthalmologists. On this occasion, he consulted Dr Leung who certified that he was suffering from a contusion injury with retinal haemorrhage. The Employee was given some eye drops and medicine, and sick leave for 7 days was recommended . Apparently, the doctor did not advise that any further treatment was necessary.

Commissioner's assessment

9. Thereafter, the Employee returned to work. As a report of the accident had been made by the Employer to the Commissioner for Labour ("the Commissioner"), the Commissioner undertook an assessment of the compensation payable to the Employee, apparently without any application for compensation having been made by the Employee himself (this process will be discussed in fuller detail later in this judgment).

10. As part of the assessment process, the Employee was asked to attend at a government clinic for a medical examination. However, he was told by a nurse that he also had the option of getting an opinion from his own doctor.

11. He therefore returned to Dr Leung. He still had some blurring of vision in his eye. However Dr Leung advised that he only had a "light degree of cataract" and that it was "not much of a problem". Again, the doctor did not advise that any further treatment was necessary.

12. Having received that opinion, the Employee did not attend any medical examinations at the government clinic.

Commissioner's Certificate

13. The Commissioner assessed the compensation payable for the injury at only the loss of wages for the days when the Employee was granted sick leave, and a certificate to that effect was duly given on 8 April 1999 under s.16A ECO (of which more later).

Third specialist

14. At the end of 1999, or early 2000, the Employee was introduced by his friends to another ophthalmologist, Dr Hung (being the third ophthalmologist consulted within 15 months). Dr Hung confirmed Dr Leung's opinion.

15. As a result of the opinions given by both Dr Leung and Dr Hung, the Employee believed that he had recovered from his injury. In the following 2 years, the Employee had no problems with his eye except for some slight blurring which did not affect his work or other activities.

Detached retina and operation

16. In September 2001, however, he woke up to great pain in his eye. He first went to the Accident and Emergency Department of a public hospital where he was given some eye-drops to alleviate the pain.

17. He then went back to Dr Hung, who diagnosed a retinal tear and referred him to the Hong Kong Eye Hospital for an operation.

18. The operation was done at the Queen Elizabeth Hospital, in the course of which a piece of metal was found at a "very peripheral" part of the retina, which had become detached. There is expert evidence before the Court that the piece of metal may have lodged in the eye during the accident. The Employee was hospitalized for 11 days and a long period of sick leave was granted (eventually until April 2002). He was told that his eyesight would be weakened after the operation, his vision blurred and his field of vision restricted. It was obvious that his injury was not as minor as his doctors had previously thought.

Employee's Objection to the Commissioner's assessment

19. Accordingly on 1 November 2001, the Employee went to the Labour Department where he filled in a form (EI-OF) addressed to the Commissioner lodging an objection to the Commissioner's assessment of compensation in April 1999 (the procedure whereby the Commissioner assesses compensation will be examined later in this judgment).

20. In this objection, the Employee objected to the amount of sick leave assessed, as it had not included the sick leave he had to take after the operation (obviously, as the assessment had taken place more than 2 years before the operation).

21. However, in the part of the form listing items of "objection", the Employee also wrote 要求判傷 (i.e. requesting assessment of his injury). As reasons for this objection, he listed his medical history and ended it by stating his hope for重新判傷 (i.e. "re-assessment of injury").

22. In the part of the form asking for reasons for the delay in lodging an objection, he stated that he had been told by doctors in 1998 and 1999 that he only had a light degree of cataract which would not affect vision much, and consequently he had not lodged an objection to the assessment.

23. The Employee also filled in a pro forma questionnaire, giving similar information.

24. The Commissioner apparently did not take any action on the application (which, in form EI-OF, was made to him) for an extension of time to lodge an objection to his certificate. Instead, he referred the Employee to the Legal Aid Department.

Application for legal aid

25. The application for legal aid took, all in all, 7 months. The application started in November 2001, but as the Employee had started his own business and his accounts were kept only in a rudimentary way, the Legal Aid Department took some time to determine his eligibility under the means test.

26. After 3 months (in late February 2002), the Employee was advised that he was not eligible for legal aid but he was advised to apply for the Supplementary Legal Aid Scheme. He did so the following month.

27. After another 3 months (in June 2002), he was accepted for the Supplementary Legal Aid Scheme.

28. The following month, an application in DCEC No. 649 of 2002 was filed.

Post-application events

29. Before the applications were heard by the judge in March 2003 however, the Employee suffered yet another detachment of the retina for which he had to have another operation and be hospitalized.

Judge's decision

30. The judge dismissed the Employee's applications set out in paragraph 2 above on the ground that he had failed to show a reasonable excuse for failing to make an application for compensation within 24 months after the accident.

Employees' Compensation Ordinance

31. Before I deal with the issues in the present appeal, it may be helpful to set out my understanding of the present scheme for employees' compensation claims, "by the book" (according to the ECO) and "on the ground" (as described by the parties).

32. Regrettably, the ECO, which had its origin in English statutes drafted nearly a century ago but which has since incorporated both English and local amendments, is by no means easy to follow. This is particularly regrettable when the purpose of the legislation is to provide for payment of compensation to injured employees, a class covering a wide spectrum of the community with various educational backgrounds. Their interests would be better served by a statute which is more "layman-friendly". The difficulties posed by the intricacies of the statute to an employee who is not legally represented are illustrated in the present case.

Scheme under the ECO

- Notification of accident

33. An employee who has been injured in an accident arising out of and in the course of employment must notify his employer of the accident if he wishes to claim compensation: s.14(1) ECO. The employer must also notify the Commissioner: s.15 ECO. This apparently "starts the ball rolling" as far as employees' compensation is concerned. (For present purposes, the position of the Employees Compensation Assistance Fund Board is disregarded).

- Role played by Commissioner

34. According to counsel for the Employee, the Commissioner then takes over the process of assessing compensation on his own initiative, even though no claim has been lodged by the employee. This assertion may or may not be correct, in view of s.16A(1A) ECO 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" (emphasis added).

35. Be that as it may, it is not disputed that no claim was lodged by the Employee in the present case and it was the Commissioner who took the initiative in assessing compensation for him.

- "Minor" injuries?

36. Assessment of compensation by the Commissioner is apparently done under s. 16A ECO which is entitled "Determination of claims in respect of minor injuries". There is no definition of "minor injuries" in the ECO, but the types of injuries that are covered under this section are set out in s.16A(1)(a) and (b). It seems to me that in the light of the injuries covered (as discussed below), it is misleading to retain the term "minor" in the heading of this section.

37. Section 16A provides:

"(1)	Where -
	(a)	a claim for compensation arises in respect of an accident causing injury to an employee that results in temporary incapacity, whether total or partial; or
	(b)	a claim for compensation arises in respect of an accident causing injury to an employee that results in loss of earning capacity as assessed under section 16D(5), 16E(8) or (9), 16G(2) or 16GA(1),
the Commissioner may assess the compensation payable under sections 7, 9 and 10".

38. It would appear from s.16A(1)(a) that the Commissioner may assess compensation in all cases except permanent incapacity. However, that is covered by s.16A(1)(b). That subsection refers to assessments under s.16D(5), etc., which assessments result from a reference made by the Commissioner under s.16D(4) when he considers that the injury is likely to result in permanent incapacity. (Compensation in fatal cases is dealt with in another part of the Ordinance and is not included in this review of the scheme).

39. Thus, far from the Commissioner determining only compensation for "minor injuries", in effect the Commissioner (whether by himself or through the assessment boards) assesses all claims for compensation under the s.16A umbrella, whether the injury results in temporary or permanent incapacity.

- Assessment by Board(s)

40. As noted above, the Commissioner may, if he considers that the injury is likely to result in permanent incapacity, refer the claim for assessment by the Employees' Compensation (Ordinary Assessment) Board: s.16D(4) ECO. This Board may in turn refer certain cases to a Special Assessment Board: s.16D(6). These Boards may issue certificates of assessment: s.16F ECO, which may be reviewed by the Commissioner if an objection is lodged by the employee or the employer: s.16G ECO. The Boards' assessments are also subject to appeal to the District Court: s.18 ECO.

- Assessment by Commissioner

41. As a matter of inference from s.16A and s.16D(4), where the Commissioner does not consider that the injury is likely to result in permanent incapacity, he may assess compensation himself, as in the present case.

- Commissioner's Certificate

42. After assessment (by the Commissioner himself or by the Board), a certificate is issued by the Commissioner stating the amount of compensation and details of the assessment: s.16A(2). On application by the employee or the employer, this certificate may be made an order of the Court: s.16A(8) ECO.

- Objection to Commissioner's Certificate

43. The employee or employer may however object to the certificate: s.16A(3). Any such objection is made to the Commissioner himself and the time limit for lodging objections is only 14 days from the issue of the certificate (although the Commissioner has the power to extend time): s.16A(3)(b) ECO.

- Cancellation of Commissioner's Certificate

44. The certificate may however be cancelled by the District Court on the application of the employee, the employer or the Commissioner if

(a) the sum provided in the certificate was not in accordance with the ECO; or

(b) if the certificate was issued in ignorance of, or under a mistake as to the true nature or extent of the injury; or

(c) the certificate was based on false or misleading material: s.16B ECO.

The time limit for an application for cancellation is 6 months from the issue of the certificate (although the Court has the power to extend time): s.16B(2) ECO.

- Appeals from the Commissioner

45. A decision or assessment of the Commissioner may be made the subject of an appeal to the District Court: s.18 ECO. The time limit for an appeal is 6 months from the date of the decision or the issue of the certificate (although the Court has the power to extend time): s.18(2) ECO.

- Applications to the Court for compensation

46. The process set out in paragraphs 34 to 45 above applies to a situation where the assessment of compensation is made by the Commissioner (whether by himself or through a Board), resulting in a certificate under s.16A.

47. Except to the extent that claims are determined under that process, claims for employees' compensation must be made to the Court: s.18A ECO. As with the time limit for claims for compensation which are determined by the Commissioner: s.16A(1A) ECO, the time limit for an application to the Court is 24 months from the date of the accident (although the Court has the power to extend time): s.14(1) ECO. (Pausing here, it is noted that, somewhat peculiarly, s.14(1) refers to an employee's "application for compensation ... under s.18A(2)", when s.18A(2) deals with an application for enforcement of compensation, not for compensation).

48. Given the "Commissioner-driven" process described above, covering all types of injury whether resulting in temporary or permanent incapacity, it is difficult to envisage a situation where an employee would take it upon himself to make an application for compensation to the Court. This has a bearing upon the approach a court should take to requests for extension of time to make applications to it.

Employee's applications

49. In the present case, the Employee had received a certificate from the Commissioner which had obviously not taken into account the subsequent deterioration of his condition. He sought to (a) make a claim for compensation from the Court on the basis that he had suffered permanent incapacity and (b) cancel the Commissioner's certificate as that had not included wages for sick leave taken during the subsequent periods of hospitalization.

Grounds for extending time

50. As for (a), s.14(1) having limited the time for making an application to 24 months after the accident, s.14(4) provides that

"(4) The Court may receive and determine any application for compensation in any case notwithstanding ... that the application has not been made in due time as required by that subsection, if it is satisfied that there was reasonable excuse for the failure ... to make an application ...".

51. As for (b), s.16B(2) provides that

"(2) An application under subsection (1) shall be made within 6 months of the date of issue of the certificate in respect of which the application is made, or within such further time as the Court, in the circumstances of any particular case, thinks fit".

Judge's decision

52. The issue before the trial judge was therefore whether the Employee had shown a reasonable excuse for not having made the application earlier. It has been generally accepted that a reasonable excuse would be made out where there was a reasonable belief on the part of the employee that his injury was trivial, or that there had been a mistaken diagnosis of his injury (Wong Man Tak v Shaw & Sons Ltd [1957] DCLR 85).

53. The trial judge held however that the Employee had failed to satisfy her that he had a reasonable excuse for the delay in bringing the application for compensation to the Court and that the facts did not warrant the exercise of her discretion to extend time under s.16B(2) either.

Discretion

54. The decision was, of course, an exercise of the judge's discretion, which should not be lightly overturned on appeal. It is well-established that an appellate court would not interfere unless it is clearly satisfied that the court below exercised its discretion under a mistake of law or a misapprehension of the facts or where its decision was plainly wrong.

55. Bearing the above principles in mind and with respect to the judge below, I have to say that in light of the facts recounted in paragraphs 4 to 28 above, the Employee had plainly made out a sufficient case for extending time. The decision not to extend time in the present case was "outside the generous ambit within which a reasonable disagreement is possible" and the appeal should be allowed.

Reasonable excuse for delay between accident and Sept 2001

56. In considering whether there was a reasonable excuse for the Employee not to have applied for compensation until July 2002, the judge first considered the period between the accident and September 2001, when the Employee's retina became detached for the first time, at which time he required an operation and hospitalization.

57. During this period up to September 2001, the only discomfort the Employee felt was a slight blurring of vision. The Employee's evidence was that after consulting Dr Leung and Dr Hung, he thought his condition would recover in time and that it was not much of a problem. Although no medical reports from Dr Leung and Dr Hung were available, the judge accepted the Employee's recollection of their diagnoses.

58. The judge found in relation to Dr Leung's opinion that

"it is highly probable that [the Employee] came under the belief from the advice of Dr Leung that his injury was not sufficiently serious to warrant an assessment by the Medical Assessment Board on permanent loss of earning capacity. If he had any inkling as to the seriousness of his condition, it would be highly unlikely that he would not have elected for medical assessment".

59. Similarly, for Dr Hung's opinion, she accepted that

"were [the Employee] given a diagnosis that he had suffered a serious eye injury as was in fact the case, it would have been highly unlikely that he would not have sought further treatment or further investigation of his eye condition".

60. The Employee's case was that having received these doctors' opinions, he thought the injury was trivial. Yet this was not accepted by the judge. She held that since he continued to have a slight blurring of vision, it was unreasonable for him to have thought that he was likely to recover from the injury which he thought was trivial.

61. With respect to the judge, that is expecting the Employee to second-guess the opinions of 2 doctors (3, including Dr Chan), all in the same specialty, whom he had consulted over the space of a year. None of them had advised further treatment or follow-up visits. None of them warned him that his retina might become detached or that there might be some other permanent incapacity. He was told that the slight blurring of vision would not be much of a problem. A layman cannot reasonably be expected to question not just 1, but 3, professional opinions. Once the court had accepted the Employee's account of these doctors' opinions (not disputed by way of respondent's notice), it would be inconsistent to find that the Employee was acting unreasonably in regarding the injury as trivial.

Reasonable excuse for period between September 2001 and applications

- The law

62. What of the period after it became apparent to the Employee that his injury was, after all, serious and permanent? It was submitted by Mr Robert Pang, counsel for the Employee, that any delay during this period (i.e. after the 24 months for making an application) was irrelevant. He submitted that on the construction of s.14(4), it was only necessary for the Employee to provide a reasonable excuse for his failure to make an application "in due time as required by" s.14(1), i.e. within 24 months of the accident. He submitted that once the failure to apply during this period could be explained to the Court's satisfaction, the "bar" to the making of an application is lifted.

63. Through the industry of Mr Richard Khaw, counsel for the Employer, this court has been referred to a number of English, Australian and New Zealand cases on the true construction of workmen's compensation statutes limiting the time for making claims for compensation.

64. It is apparent from these cases that the courts found submissions such as that advanced by Mr Pang unattractive (see dictum of Duke LJ in Prophet v Roberts 11 BWCC 310, 310; dictum of Eve J in Hillman v London Brighton and South Coast Railway Co. [1920] 1 KB 284, 300-1; and the judgment of the New Zealand Court of Appeal in Morrison v Liddle Construction Ltd [1951] NZLR 1079, 1090).

65. However, even in those cases where the courts did accept the submission that a reasonable excuse for the statutory period permitted an application to be made out of time - irrespective of whether there was subsequent delay, those decisions were compelled by the language of the statute in question (see Lingley v Thomas Firth and Sons Ltd [1921] 1 KB 655, 661-2, 665, 668-9; Murray v Baxter and others [1914] 18 CLR 622, 633).

66. Thus, in both Lingley and Murray, the judges referred to the "bar" to the proceedings in the statutes in question which provided:

"(1) Proceedings for the recovery under this Act of compensation for an injury shall not be maintainable .... unless the claim [or in Australia, "the proceedings"] for compensation with respect to such accident has been made [or commenced] within six months from the occurrence of the accident causing the injury ....

Provided ... that ....

(b) the failure to make a claim [or commence proceedings] within the period above specified shall not be a bar to the maintenance of such proceedings if it is found that the failure was occasioned by mistake, absence from [the jurisdiction] or other reasonable cause" (emphasis added).

In Lingley, Lord Sterndale MR held (at 662) that "the proper construction is that the only thing with which that proviso is dealing is the failure to make a claim within the six months; that being gone the bar is gone also". Warrington LJ held (at 665) that "if it is found that the failure to make the claim within six months was occasioned by reasonable cause, then the bar provided by the statute is gone altogether and that any subsequent delay has no effect, except so far, of course, as it may bring into operation any general statutory enactment as to limitation which would apply to the case". Scrutton LJ held (at 669) that "... I see no escape from the words of the section or the proviso, which appear to me to mean that you have to consider the period of six months during which the claim was not made, and then if there was reasonable cause for not making it within the six months the bar or limitation has gone and you are at large".

67. In Murray, the majority decision was that on the construction of the statute, "the Act distinctly states and limits within fixed termini a condition precedent; it permits that condition to be excused; if it is excused its effect ceases, and if we were to extend the limits specified, we should be creating a different condition".

68. In Hong Kong, however, the statute is differently worded. Section 14(4) provides that "the Court may receive and determine any application for compensation in any case notwithstanding ... that the application has not been made in due time as required by that subsection, if it is satisfied that there was reasonable excuse for the failure ... to make an application ...". And s.16B(2) provides that "(2) an application shall be made ... within such further time as the Court, in the circumstances of any particular case, thinks fit".

69. It is not a question of a statutory bar being lifted and thereby being "gone altogether". The language in the Ordinance here is obviously discretionary, and in the exercise of its discretion whether to extend time, it is clear that a court would not assist a party who has slept on his rights.

- The facts

70. Turning then to the period after September 2001, the Employee was hospitalized until the end of September 2001. He approached the Labour Department at the end of October 2001.

71. As noted above, he filled in a pro forma document addressed to the Commissioner asking for an extension of time for cancellation of the Commissioner's certificate and for "re-assessment of injury". In my view, given the role played by the Commissioner in the assessment of the Employee's compensation under the present regime, the Employee should be forgiven for thinking that he had gone to the right place and had done all he could to pursue his rights.

72. Although the application was addressed to him, the Commissioner apparently made no decision on the application (whether to extend time, or to "re-assess" the injury) but simply referred the Employee to the Legal Aid Department. The decision on legal aid took a few months. Apparently at no stage during this period was the Employee advised by either the Commissioner or by Legal Aid that his application to the Commissioner was not going to be answered, so that he should make his own application to the Court instead.

73. Although ignorance of the law is not an excuse for delay in bringing proceedings, given the history of the "Commissioner-driven" assessment, the fact that the Employee had not been dilatory in applying to the Commissioner for an extension of time and for an "re-assessment", as well as the fact that there was no reply to his applications from the Commissioner, in my view, the discretion of the court could only have been exercised in favour of allowing him time to make the application when he did.

Order

74. Accordingly, I would allow the appeal, set aside the judge's order and the order of Muttrie DJ given on 30 April 2003 in consequence of that order, and give an order in terms of paragraphs 1 and 2 of the Employee's summons filed on 23 September 2002. As for costs, I would give an order nisi that the costs of the applications in the court below be costs in the cause in DCEC No 649 of 2002 and that the costs of the appeal follow the event, i.e. that the Employer pay the Employee's costs to be taxed if not agreed. The Employee's own costs should be taxed in accordance with Legal Aid Regulations.