YIP PAK HUNG v. YPT INTERNATIONAL LTD

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

LABOUR TRIBUNAL APPEAL NO. 46 OF 1989

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JUDGMENT

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1. I have been ably assisted by counsel on both sides. I am left with no doubt as to what decision I am to arrive at at the conclusion of their respective helpful submissions.

2. The dispute between the parties in all the proceedings could hardly be simpler. Mr Yip was the ex-employee of YPT International Ltd., the appellant company. Three sets of proceedings were brought before the Presiding Officer of the Labour Tribunal, but the material facts involved were identical. Disagreement in all could be resolved simultaneously.

3. The three sets of proceedings arose in this way : the appellant company commenced proceedings against Mr Yip as an ex-employee. His employment was on terms evidenced by a appointment letter and some oral agreement as regards further commissions. The letter of employment merely provided for his minimum guaranteed commission at $1,500 per month. Mr Yip was entitled to project commission as well as unit sale commission. As I understand them, unit sale commission related to the total sales that Mr Yip was able to promote, and his commission was to be calculated on a percentage of any excess over and above $550,000. Project commission, as I have been informed by counsel, represented a percentage on the extras that flowed from or accompained the sales Mr Yip procured.

4. The unit sale commission and the project commission and the rate in respect of each are not matters in dispute. What is disputed between the appellant company and Mr Yip is simply this : as regards the $1,500 per month by way of minimum commission, the appellant company claims that Mr Yip's total commission income was to be inclusive of or, in other words, subject to a deduction of this monthly guaranteed minimum. As for Mr Yip, his claim is that the appellant company must pay him unit sale commission and project commission plus or on top of this $1,500 guaranteed monthly minimum. That is, in broad terms, the disputes between the parties to all the proceedings.

5. The proceedings arose also in a very peculiar manner : the appellant company was dissatisfied with the way in which Mr Yip had himself discharged. Mr Yip simply informed the company that he was no longer interested and absented himself from further attendance. The company felt aggreived. The company claims that Mr Yip must give, in accordance with the contract between them, a proper notice for termination of his services. The plain assertion of the appellant company is that Mr Yip did not do so. On the other hand, Mr Yip complains that the company had wrongly deducted his monthly guaranteed minimums of $1,500 from his commission income, hence the company had misconducted itself. Mr Yip relied on the alleged wrongful action of the company as a constructive dismissal. He left the company and he sued it for wrongful dismissal without notice. In all, there were three causes of action. I shall put them in the order of time of their alleged accruals : first, the appellant company sued Mr Yip for compensation in lieu of a proper notice of termination. Second, Mr Yip sued the appellant company for arrears in wages, payment of commissions etc.. Thirdly, Mr Yip sued the appellant company additionally for wages in lieu of a lawful notice of dismissal.

6. As I said, the three sets of proceedings arose in a peculiar manner because in the company's proceedings against Mr Yip in the Labour Tribunal under proceedings entitled 733 of 1989, at the first hearing before the Presiding Officer on the 25th July 1989, on account of certain observations made by Mr Yip and presumably of the available documents, leave was granted to Mr Yip to "counterclaim" for his arrears of wages, commissions etc. By the time the proceedings were resumed on the 22nd August 1989, Mr Yip's "counterclaim" made its debut in form of proceedings 733 of 1989. Of 464 and 733, matters were dealt with by the Presiding Officer piecemeal in the sense that only the claim of Mr Yip in 733 was disposed of with the appellant company's 464 stood over. Mr Yip was inter alia granted, I believe, $11,301. That concluded the 733 proceedings. On the 29th August, 1989, the company applied for leave to appeal in 733.

7. The Presiding Officer delivered his written judgment on the 12th September 1989. I should mention : at the conclusion of the proceedings on the 22nd August, Mr Yip made certain proposals to the appellant company that he was not to institute proceedings for his claim for wages in lieu of notice if certain conditions were met by the appellant company. His proposals were not acceded to and consequently Mr Yip commenced his proceedings 860 of 1989 for wages in the lieu of proper notice on the 6th September 1989. Therefore, before the written judgment in 733 was handed down on the 12th September, to all intents and purposes two proceedings were outstanding - 464 of the appellant company against Mr Yip and the new proceedings 860 by Mr Yip against the appellant company. 733 had been concluded and leave to appeal was being sought.

8. Hearing of these outstanding proceedings 464 and 860 resumed on the 27th September 1989. The 733 proceedings were also purportedly re-opened. Decision was reserved until the 3rd October, 1989 when the appellant's claim in 464 was dismissed and the claim of Mr Yip in 860 was upheld with a supplemental award to Mr Yip in proceedings 733 which had, according to the documents, been concluded and against which an application for leave to appeal was pending. Written judgment in 464, 860 and purportedly in 733 was delivered the next day, the 4th October.

9. Leave to appeal in 737 was granted on the 11th October 1989. It is equally peculiar that leave was granted to appeal against the supplemental award purportedly made on the 3rd October in 733 after its conclusion.

10. There can be little doubt that the proceedings in 733 had reached finality culminating in an award given on the 22nd August. If curial verification need be provided, one finds it in Exh. B, a letter so marked in this appeal, from the Labour Tribunal to solicitors for the appellant company dated 26th September 1989. There can be no doubt whatsoever that the Presiding Officer acknowledged the proceedings in 733 as having been determined. On the appellant's allegation of judicial errors, the Presiding Officer through the Registrar of the Labour Tribunal commented :

"Where the Tribunal is satisfied that there was a genuine excusable mistake on the part of the company's representative, the Tribunal will reopen the issue because, after all, the employee can only get what is justly due to him". (Emphasis added).

 

11. The statutory period prescribed for review in 733 had expired and an application for leave to appeal was pending. There was no notice to review and consent was never given. Hence, there was no justification for the Presiding Officer in giving judgment on the 3rd October for the proceedings commenced on the 27th September, to have a further award added in favour of Mr Yip under the concluded 733.

12. At the conclusion of the proceedings of 733 on the 22nd August, the Presiding Officer awarded against the appellant company $11,301. The computation of this sum leaves much to speculation. Both counsel seem to agree that what was in the mind of the Presiding Officer must have been the $6,801 in Exh. D3, and the $4,500 commission deducted, wrongly he held, as reflected in Exh. D4. The two sums together, $6,801 plus $4,500, would yield a arithmatical total of $11,301.

13. Assuming that be correct for the time being, what did the Presiding Officer have regard to in arriving at that $11,301? In his written judgment delivered on the 12th September 1989 for the determination made on the 22nd August, the Presiding Officer apparently obtained the figure of $11,301 with the aid of what is said to be "payment record", Exh. D2. This is a document appearing at p.97 of the Appeal Bundle. It is a document which is, according to counsel, referred to in the statement of Mr Wong, the Assistant Sales Manager of the appellant company, at p.85 of the Appeal Bundle, translation of which at p.86. P.97 of the Appeal Bundle bears the marking "T.S.T. No. 733/89 D2", but the List of Exhibits for "Counterclaim" TST 733 of 1989 contains no reference to "D2".

14. But that is not all. What is crucial in the attack mounted against the decision of the Presiding Officer is that he did not pay or did not appear to have paid any regard to the written statements of the parties to the proceedings. That is patently clear from his record. He neither marked the statements nor did he refer to them in his notes of proceedings. There was no recorded cross-examination or opportunity afforded for it. The statements were further criticised by Mr Chiu on behalf of the appellant company as not having been properly taken with a statement from the Tribunal Officer in terms of s.14(6) of the Labour Tribunal Ordinance.

15. In stark contrast, the notes of the later proceedings taken by the Presiding Officer duly recorded the admission of written statements and consequential cross-examination thereon. It would appear that the Presiding Officer relied exclusively on his interpretation of the letter of appointment in disallowing any deduction of the monthly guaranteed minimum from Mr Yip's commission income.

16. The appointment letter is plain enough. It does not refer to unit sale commission nor project commission, how they were to be calculated or how the guaranteed minimum was to be dealt with in overall terms. Those were all matters orally agreed. It is inconceivable how a proper determination could be made on the appointment letter alone. The decision of the Presiding Officer given on the 22nd August and reduced into writing on the 12th September 1989 cannot, therefore, be supported. The. purported award added on the 3rd October must likewise fall.

17. It is contended on behalf of Mr Yip that the parties had chosen to frame a simple issue. Figures were within reach of the Presiding Officer, and the statements were available to him. Further, so counsel argues, on the subsequent occasion when matters were broached with full viva voce and all the relevant evidence, the Presiding Officer had reached the same conclusion with only minor calculation adjustment. That may very well be so. Granted also that the Presiding Officer is known to be a competent officer with considerable experience, but once a prior decision had been taken, one's view, as Mr Chiu has fairly submitted, could hardly remain uncoloured even on another occasion conducive to proper adjudication. With a preconceived idea pronounced and later reduced into a written judgment on the 12th September, it would seem highly undesirable not to allow these litigants to be afforded the fullest of opportunity to have their issues re-ventilated.

18. Mr Chiu's submissions cannot be faulted. It is encumbent upon this Court to allow the appeal and to remit the matter for a retrial by the Labour Tribunal in the person of a different Presiding Officer.

19. The outstanding matter is the application for leave to appeal against the determinations of the same Presiding Officer in proceedings 464 and 860. Mr Chiu invites this Court to stand that application over pending the re-trial by the Labour Tribunal of the case now stands remitted, and I so accede to his request.

20. The order made by the Court is as follows : (1) Appeal be allowed; (2) Award and purported award including costs thereof in 733 be set aside; (3) Claim 733 be remitted for readjudication by the Labour Tribunal in the person of a different Presiding Officer, and (4) costs, subject to what Mr Chan has to say, be costs for the appellant company against the defendant in this Court, and costs before the Presiding Officer should, in my view, be costs in the cause of the re-trial.