SINGH BALJIT v. FORWARD & CO. LAWYERS

CACV 42/2022

[2022] HKCA 1209

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 42 OF 2022

(ON APPEAL FROM HCA NO 552 OF 2020)

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BETWEEN

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J U D G M E N T

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Hon G Lam JA (giving the Judgment of the Court):

1.  This is an appeal by the plaintiff from the decision of Au-Yeung J (“Judge”) dated 13 January 2022[1] dismissing his appeal against the order of Master Kent Yee striking out the plaintiff’s Statement of Claim and dismissing his action.

Background

2.  The plaintiff is a Hong Kong resident born in Hong Kong. He obtained an LLB degree in 2005 and an LLM degree in 2013. He was admitted as a solicitor in New South Wales, Australia in 2015. He did not take the Postgraduate Certificate in Laws course, and planned to qualify as a Hong Kong solicitor through the route of admission of overseas lawyers.

3.  On 22 January 2018, he began employment as a Legal Executive with the defendant, Ms Ho Siu Fan Viola, a solicitor who practised as a sole proprietor in Hong Kong in the name of “Forward & Co. Lawyers”. On 9 March 2018, the plaintiff was registered as a Registered Foreign Lawyer with the Law Society of Hong Kong and became employed by the defendant as a Registered Foreign Lawyer. By his own resignation, on 16 November 2018 the plaintiff ended the employment, and the defendant provided a reference letter for him.

4.  On 1 March 2019, the plaintiff began to be employed by the defendant again as a Registered Foreign Lawyer. On 16 October 2019, the plaintiff provided the defendant with a resignation letter and ended his employment on the same date. There is a dispute as to whether his resignation on this occasion was voluntary.

5.  In his Statement of Claim, the plaintiff pleads that the defendant dismissed him and terminated the employment with immediate effect by a WhatsApp text message without any explanation, without any prior warning, and without giving him an opportunity to explain: §§13, 22, 30. The plaintiff pleads that the dismissal was not justified or lawful, that the defendant breached the implied duty of trust and confidence owed to him, and that he was justified in treating the contract as having been unlawfully breached, enabling him to claim constructive dismissal: §§14, 19, 21.

6.  The plaintiff also asserts that the defendant’s act was grossly negligent, intentional, malicious, or reckless and would foreseeably cause severe harm to him, and that the defendant failed to fulfil her duty of care to act reasonably to prevent foreseeable harm to him: §§37, 38, 39.

7.  The plaintiff avers that by reason of the matters pleaded, he suffered loss and damage, the quantum of which is to be assessed: §41.

8.  In the prayer for relief, the plaintiff claims general damages, punitive damages, and “Actual damages”, and sets out a number of heads of damage, and in addition claims interest, costs and further or other relief.

9.  It appears that the plaintiff’s grievances are in part due to the fact that an overseas lawyer admitted in a common law jurisdiction, such as the plaintiff is, requires at least two years of post-admission experience before he can apply for admission as a solicitor in Hong Kong, subject to his completing the Overseas Lawyers Qualification Examination.

10.  The defendant filed a defence on 19 October 2020 (which was amended on 19 November 2020). The first point taken in the defence is that the High Court has no jurisdiction to hear the action, because of the provisions of the Labour Tribunal Ordinance (Cap 25).

11.  The plaintiff filed his Reply on 3 November 2020.

12.  On 7 January 2021, the defendant applied by summons for an order striking out the Statement of Claim. On 16 August 2021, Master Kent Yee heard the application and made an order striking out the Statement of Claim and dismissing the action with costs. From that decision, the plaintiff appealed to a Judge in chambers.

The decision below

13.  In her decision (“Decision”), the Judge referred to her decision in the previous case of Woo Kwok Ping v The Incorporated Management Committee of Tsuen Wan Trade Association Primary School [2020] 1 HKLRD 717 for the principles for dealing with a challenge to an action on the ground that the claims fall within the exclusive jurisdiction of the Labour Tribunal (“Tribunal”).[2] In particular, she stated that where there are mixed claims, the proper approach is to look at the substance of the dispute and not the labels put in the pleadings, and the court should assess whether the other claims brought by the plaintiff are merely for “window dressing”, such that the real claim left is one that falls within the Tribunal’s exclusive jurisdiction. After describing and examining the contents of the Statement of Claim, the Judge said that it is plain that the plaintiff’s claim is based on termination of employment and that it is within the exclusive jurisdiction of the Tribunal, even if some of the damages claimed are unliquidated.[3]

14.  The Judge rejected the plaintiff’s contention that his claim was a mixed claim in both employment and tort and that there were reliefs sought based on statutory provisions and foreign law and complex issues that are not suitable for adjudication by the Tribunal, for several reasons. First, the Judge noted that the prayers for relief in the pleading show that the claim is a purely monetary claim, with no non-monetary relief sought. Secondly, the plaintiff had not set out material facts supporting the phrases inserted in the pleading for apparently tortious claims. Thirdly, the matters pleaded only in the Reply could not be relied upon for salvaging the Statement of Claim. Fourthly, so far as there was a claim for harassment, the plaintiff had not pleaded the necessary acts. So far as the alleged breach of implied duty of trust and confidence was concerned, there was no plea as to how it could arise and be implied, and it was in any event based on the cause of dismissal, a matter within the exclusive jurisdiction of the Tribunal. Insofar as negligence was relied upon, the pleaded duty was incomprehensible and gave rise to no reasonable cause of action. Accordingly, the Judge concluded that there was no tort claim and even if certain terms for tort claims had been used in the pleading, there was no reasonable cause of action in tort.[4] The action fell within the exclusive jurisdiction of the Tribunal. The plaintiff’s appeal was therefore dismissed with costs.

The appeal to this court

15.  The grounds of appeal put forward by the plaintiff in his Notice of Appeal filed in this court may be set out as follows:

(1) Instead of amending the Statement of Claim, which might render it difficult to read, if the Reply could cure the defects identified, the action should be allowed to proceed.

(2) “By taking into account the substance and all the matters in dispute of the whole action, not all employment disputes can possibly have non-monetary relief to exclude from the jurisdiction of the Labour Tribunal”.

(3) “By taking into account the substance and all the matters in dispute of the whole action, monetary relief bearing Tort remedies can be outside the exclusive jurisdiction of the Labour Tribunal”.

(4) “By taking into account the substance and all the matters in dispute of the whole action, monetary relief bearing Tort remedies from criminal liabilities in a civil action shall be outside the exclusive jurisdiction of the Labour Tribunal”.

(5) Jurisdictional issue with reference to the correct venue of the whole action can only be concluded subsequent to … determining the cause(s) of action”.

(6) “Labour Tribunal does not have jurisdiction to adjudicate matters concerning foreign elements”.

(7) “Labour Tribunal does not have jurisdiction to adjudicate matters concerning breach of Legal Practitioners Ordinance, Cap. 159 and Solicitors’ Practice Rules, Cap 159H in particular with criminal intense”.

(8) “Labour Tribunal does not have jurisdiction to adjudicate matters concerning breach of enactment under the Mandatory Provident Fund Schemes Ordinance, Cap 485”.

(9) “Labour Tribunal does not have jurisdiction to adjudicate matters concerning private right of actions impliedly conferred by statute”.

(10) “Labour Tribunal does not have jurisdiction to adjudicate matters concerning criminal proceedings involving breaches of Mandatory Provident Fund Schemes Ordinance, Cap 485 and Inland Revenue Ordinance, Cap 112”.

(11) “Labour Tribunal does not have jurisdiction to adjudicate matters concerning statutory interpretation, in particular of foreign laws”.

(12) “Labour Tribunal does not have jurisdiction to adjudicate matters concerning lengthy and complex issues including both facts and laws with foreign elements”.

(13) “Breach of enactments under the Inland Revenue Ordinance, Cap 112 are criminal offences and not within the exclusive jurisdiction of the Labour Tribunal.”

(14) “Breach of Statutory Duty is a cause of action founded in Tort and not within the exclusive jurisdiction of the Labour Tribunal”.

(15) “A failure to pay minimum wage with criminal intents under the Employment Ordinance, Cap 57 is a criminal offence bearing civil remedies under Tort.”

Discussion

16.  Section 7 of the Labour Tribunal Ordinance (Cap 25) (“Ordinance”) provides:

“ 7. Jurisdiction of tribunal

(1) The tribunal shall have jurisdiction to inquire into, hear and determine the claims specified in the Schedule.

(2) Save as is provided in this Ordinance, no claim within the jurisdiction of the tribunal shall be actionable in any court in Hong Kong.”

17.  The Schedule to the Ordinance provides:

“ 1. A claim for a sum of money, whether liquidated or unliquidated, which arises from—

(a) the breach of a term, whether express or implied or (if relevant) arising by force of section 10(1) of the Minimum Wage Ordinance (Cap. 608), of a contract of employment, whether for performance in Hong Kong or under a contract to which the Contracts for Employment Outside Hong Kong Ordinance (Cap. 78) applies;

(aa) the breach of a term, whether express or implied or (if relevant) arising by force of section 10(1) of the Minimum Wage Ordinance (Cap. 608), of a contract of apprenticeship; or

(b) the failure of a person to comply with the provisions of the Employment Ordinance (Cap. 57), the Minimum Wage Ordinance (Cap. 608) or the Apprenticeship Ordinance (Cap. 47),

other than a claim specified in the Schedule to the Minor Employment Claims Adjudication Board Ordinance (Cap. 453).

2. A claim for contribution under section 26(2).

3. Notwithstanding paragraphs 1 and 2, the tribunal shall not have jurisdiction to hear and determine a claim for a sum of money (whether liquidated or unliquidated), or otherwise in respect of a cause of action, founded in tort whether arising from a breach of contract or a breach of a duty imposed by a rule of common law or by any enactment.”

18.  The plaintiff does not in substance dispute the principles that the Judge applied, as set out in Woo Kwok Ping v The Incorporated Management Committee of Tsuen Wan Trade Association Primary School [2020] 1 HKLRD 717, on how to deal with a challenge to an action on the ground that the claims therein fall within the exclusive jurisdiction of the Tribunal.

19.  Turning to the plaintiff’s first ground of appeal, we are unable to see any error in the Judge’s decision. A Reply is for the purposes of dealing with the pleas in the Defence, not for raising a new cause of action not pleaded in a Statement of Claim at all: Hong Kong Civil Procedure 2022, vol. 1, para 18/3/2. If a plaintiff says that certain deficiencies in his statement of claim can be cured, whether by reason of matters pleaded in the reply or not, it is for him to demonstrate how the defects may be rectified. The plaintiff here has failed to show how his Reply may salvage his Statement of Claim. No draft Amended Statement of Claim was placed before the court. The Judge was entitled to focus her attention on the Statement of Claim, which was the subject matter of the summons to strike out.

20.  The plaintiff, in his written and oral submissions, complained that the defendant had failed to make her strike-out applications promptly, before the close of pleadings. However, the point taken by the defendant here is one of jurisdiction, and whilst the timing of the application may have implication on costs, the mere fact that it was brought after the close of pleadings does not mean that the Judge erred in any way in entertaining it.

21.  Ground 2, as formulated, is not easy to understand. It appears from the plaintiff’s skeleton argument that the point being made is that issues involving complexity in fact or laws (e.g. foreign laws) or mixed claims are not within the exclusive jurisdiction of the Tribunal. Where complex issues of fact or law arise, that may be relevant to the exercise of the Tribunal’s power to decline jurisdiction and transfer the case elsewhere under section 10 of the Ordinance. But we do not think that the complexity of issues as such affects the question whether a matter falls within the exclusive jurisdiction of the Labour Tribunal. The answer to that question turns on whether the only real claim is “a claim for a sum of money, whether liquidated or unliquidated, which arises from … the breach of a term, whether express or implied … of a contract of employment” (see para 1(a) of the Schedule to the Ordinance).

22.  Grounds 3 and 4 state that a claim for monetary relief in tort does not lie within the jurisdiction of the Tribunal. Ground 5 states that the question of jurisdiction needs to be determined after ascertaining the causes of action. These propositions are not, in themselves, controversial. In his submissions the plaintiff has referred to a claim for harassment and negligence.

23.  So far as harassment is concerned, §17 of the Statement of Claim pleads:

“ The Plaintiff understands that bullying and harassment are common amongst professionals, especially in the legal profession in Hong Kong. Usually after a campaign of bullying and harassment intended to make the target of bullying or harassment quit fails, such target is unfairly dismissed. The Plaintiff trainee lawyers including the Plaintiff is at high risk given they often cannot make complaints to the Law Society or take legal action for fear of damaging their reputation and making themselves un-employable. Nonetheless, the Plaintiff as a trainee should not be fired without serious justification such as fraud.”

24.  The Judge held that there was no reasonable cause of action disclosed as the plaintiff had not pleaded that he had been bullied or harassed or pleaded a course of conduct by words or action sufficiently repetitive in nature that the defendant ought reasonably to know would cause worry, emotional distress or annoyance to the plaintiff.[5] In his skeleton argument, the plaintiff asks whether the Tribunal will adjudicate on harassment, and whether it will transfer the whole matter to the court. He submits that that would be an abuse of the Tribunal process and not in the interests of justice. The plaintiff’s submissions seem to us to miss the point. As required by Order 18 rule 7(1) of the Rules of High Court (Cap 4A), the Statement of Claim must contain “a statement in a summary form of the material facts on which the [plaintiff] relies for his claim”. The Judge took the view that the plaintiff had failed to plead the necessary material facts. On this appeal, the plaintiff has likewise wholly failed to point to any requisite pleaded facts for this cause of action or to show any error in the Judge’s conclusion.

25.  As for negligence, §37 of the Statement of Claim says that a contract of employment may only be lawfully terminated by giving notice or payment of wages in lieu of notice, unless there are grounds for summary dismissal. It goes on to allege that the defendant’s “act was grossly negligent”. The defendant’s “act” complained of by the plaintiff centres around the circumstances of the alleged wrongful summary or constructive dismissal.

26.  §38 then states:

“ Ms. Ho act, behaviour and/or omission was obviously foreseeable that would have cause severe harm to the Plaintiff. She had a legal obligation requiring adherence to a standard of reasonable care while performing any acts that could foreseeably harm the Plaintiff and his career, hence, Ms. Ho was negligence and Ms. Ho duty of care is non-delegable. Ms. Ho had failed to fulfil her duty of care to act reasonably in respect of not acting in a reasonable manner to prevent the foreseeable harm to the Plaintiff.”

27.  The Judge found this pleaded duty incomprehensible and observed that the plaintiff had not cited any authority in support of the alleged duty. Likewise we find it difficult to understand the basis, scope and content of the alleged duty. The plaintiff has failed to address these deficiencies. Nor has he been able to explain how this alleged duty interacts with or adds anything to the implied obligation of trust and confidence in the contract of employment: Semana Bachicha v Poon Shiu Man [2000] 2 HKLRD 833; Tadjudin Sunny v Bank of America, National Association (CACV 12/2015; 20 May 2016). The plaintiff’s allegation of negligence seems to us to add nothing to what may be argued as breach of the implied obligations under the contract of employment and does not therefore assist him in the context of the jurisdictional question, for it is mere “window-dressing”.

28.  Grounds 6 to 15 of the Notice of Appeal refer to a number of matters said to be outside the jurisdiction of the Tribunal altogether.

29.  As to Grounds 6, 11 and 12 which concern “foreign elements”, as explained above the relevant question here concerns the nature of the claim and relief sought, not whether certain “foreign elements” have been raised in the materials. There is no claim made in the Statement of Claim under any foreign law.

30.  Grounds 9 and 14 in effect state that claims for the tort of breach of statutory duty and claims based on private rights of action conferred by statute are not within the jurisdiction of the Tribunal. This is not controversial: see Estinah v Golden Hand Indonesian Employment Agency [2001] 4 HKC 607. But the question remains whether there is any such real claim properly pleaded by the plaintiff. We can find none in the Statement of Claim.

31.  Grounds 7, 8, 10 and 13 assert that the Tribunal does not have jurisdiction to adjudicate on matters concerning breaches of certain specified enactments, including the Legal Practitioners Ordinance, Solicitors’ Practice Rules, Mandatory Provident Fund Schemes Ordinance and Inland Revenue Ordinance. The propositions stated in these Grounds seem to us to be too widely framed, but the relevant question in any event is whether there is any real claim under those statutes properly pleaded by the plaintiff. It is clear from the Statement of Claim that no particulars of any alleged breaches of these enactments have been pleaded. None of these written laws is even mentioned in the Statement of Claim.

32.  Ground 15 refers to the failure to pay minimum wage but breach of a term arising by force of section 10(1) of the Minimum Wage Ordinance falls within paragraph 1(a) of the Schedule to the Ordinance. In any event, no fact has been pleaded in the Statement of Claim that amounts to an alleged breach in this regard.

Conclusion

33.  For the above reasons, it is clear that the plaintiff has failed to show that the Judge erred in any way in dismissing his appeal against the Master’s order striking out the Statement of Claim and dismissing the action. Accordingly, the plaintiff’s appeal must be dismissed.

34.  Since there was agreement at the hearing that costs should follow the event, there will be an order that the plaintiff do pay the defendant the costs of the appeal. We summarily assess the costs in the sum of $112,300.