RAZAFINDRATSARA, RAVAONIRINA CHARLINE C. v. RAHARJA GROUP LTD

HCSA 57/2017

[2018] HKCFI 1714

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

SMALL CLAIMS TRIBUNAL APPEAL NO 57 OF 2017

(ON APPEAL FROM SCTC No 25729 OF 2016)

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D E C I S I O N

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INTRODUCTION

1.  This is the Claimant’s application for leave to appeal against the order of Mr David Chan, Adjudicator of the Small Claims Tribunal, dated 8 November 2017 dismissing her claim against the Defendant for repayment of the sum of HK$18,069 which the Claimant alleges to be “excessive and illegal agency fees” paid by her to the Defendant.

BASIC FACTS

2.  The basic facts of this matter are set out in a written judgment of the Adjudicator dated 20 November 2017 (“the Judgment”) and will not be repeated here.  The following brief summary should suffice for the present purpose.

3.  The Defendant is a licensed employment agency operating in Hong Kong.  East Asia Job Agency (“East Asia”) is a local employment agency in Madagascar.  By a job order dated 25 March 2015, the Defendant requested East Asia to recruit a domestic helper to work in Hong Kong.  Eventually, the Claimant was recruited.  She entered into a standard foreign domestic helper contract with Luo Ying dated 8 April 2015.

4.  Clause 7(a) of the employment contract states as follows –

“The Employer shall provide the Helper with free passage from his/her place of origin to Hong Kong and on termination or expiry of this contract, free return passage to his/her place of origin”.

5.  Clause 8 of the employment contract further states as follows:-

“The Employer shall be responsible for the following fees and expenses (if any) for the departure of the Helper from his/her place of origin and entry into Hong Kong –

(i)  medical examination fees;

(ii)  authentication fees by the relevant Consulate;

(iii)  visa fee;

(iv)  insurance fee;

(v)  administration fee or fee such as the Philippines Overseas Employment Administration fee, or other fees of similar nature imposed by the relevant government authorities; and

(vi)  others: …

In the event that the Helper has paid the above costs or fees, the Employer shall fully reimburse the Helper forthwith the amount so paid by the Helper upon demand and production of the corresponding receipts or documentary evidence of payment.”

6.  The Claimant arrived in Hong Kong from Madagascar on 12 June 2015 and commenced to work in Luo Ying’s household on 19 June 2015.  Her monthly salary, as stated in the employment contract, was HK$4,110.

7.  According to the Claimant:-

(1)  Prior to coming to Hong Kong, she had been told by East Asia in Madagascar that she had to pay the sum of HK$3,080 each month for a total period of 8 months to the Defendant to cover the cost of her air fare to Hong Kong and other expenses relating to the processing of her work visa.

(2)  She was not aware, at that time, that all the expenses for her entry into Hong Kong as a domestic helper should be paid by her employer.

(3)  She did as told by East Asia for 5 months, paying to the Defendant the sum of HK$3,080 from July to November 2015 in each month.

(4)  In or about December 2015, she was told by other Madagascan domestic helpers who had also been recruited by the Defendant that the fees charged by the Defendant were excessive, and she was advised by a support group called “Helpers for Domestic Helpers” that it was unlawful for an employment agency in Hong Kong to charge fees in excess of 10% of her first month’s wages.  She therefore told the Defendant that she would stop making the monthly payment of HK$3,080.

(5)  Nevertheless, for reasons and in circumstances which it is not necessary to set out in this decision, she made one more payment of HK$3,080 on 3 April 2016.  The 6 payments of HK$3,080 each, totalling HK$18,480, shall hereinafter collectively be referred to as the “Monies”.

(6)  On 30 April 2016, her employment by Luo Ying was terminated.  She did not make any further payment to the Defendant after that date.

8.  It is the Claimant’s case that the net amount of HK$18,069, ie HK$18,480 less the sum of HK$411 which the Claimant accepts the Defendant was entitled to receive as agency fee or commission under Section 10 of, and the Second Schedule to, the Employment Agency Regulations, Cap 57A, represents unlawful fee or commission which the Defendant is liable to repay to her.

9.  The Defendant’s case, in a nutshell, is that it only acted as Luo Ying’s, but not as the Claimant’s, employment agent.  Further, the Defendant says that the Monies paid by the Claimant were for the repayment of a loan advanced by Toyo Finance and Credit Limited (“Toyo”) to the Claimant which was used to pay for the costs of the “placement, training and processing to Hong Kong”, and the Claimant requested the Defendant to transmit the Monies to Toyo on her behalf, which the Defendant did as requested.

10.  In support of its defence, the Defendant produced the following undated documents as proof of the alleged loan in the amount of HK$20,400 (or an amount in Malagasy Ariary equivalent to HK$20,400) from Toyo to the Claimant:-

(1)  a “Personal Loan Application Form” bearing the Claimant’s purported signature;

(2)  a “Debt Statement” bearing the Claimant’s purported signature and thumb print; and

(3)  a “Loan Agreement of Placement Fee for Potential Malagasy Overseas Workers (Domestic Worker) to Hong Kong SAR” bearing the Claimant’s purported thumb print.

11.  The Claimant disputes the authenticity of the above documents.  In her Supplemental Statement dated 27 February 2017, the Claimant stated that she never applied for any loan from Toyo, and the first time she saw those documents was when they were produced by the Defendant in the course of the proceedings in the Small Claims Tribunal.  She also stated that she never knowingly signed any document relating to any loan with Toyo, although she had signed some documents in a hurry in Madagascar before she came to Hong Kong which she had been told were in relation to her application for employment in Hong Kong.  At the hearing on 18 July 2018, Mr Chan clarified on behalf of the Claimant that the signatures on the Personal Loan Application Form and Debt Statement looked like her signatures but she had no recollection of having ever signed those documents.  The Claimant maintains, in any event, that she never borrowed any money from Toyo and had no dealing with that company.  Her case, which she also advanced before the Adjudicator, is that the alleged loan was fabricated by the Defendant in collusion with Toyo to disguise the collection of an illegal placement fee or commission.

12.  The banking documents produced by the Defendant showed that the Defendant promptly transferred the first 5 payments received from the Claimant to Toyo, as follows:-

Amount	Date of Receipt	Date of Transfer to Toyo
HK$3,080	20 July 2015	21 July 2015
HK$3,080	23 August 2015	24 August 2015
HK$3,080	20 September 2015	21 September 2015
HK$3,080	23 October 2015	23 October 2015
HK$3,080	25 November 2015	25 November 2015

13.  In so far as the last payment of HK$3,080 is concerned, the documentary evidence before the Adjudicator showed that it was paid directly to Toyo via a 7-Eleven Convenience Store in Tai Po on 3 April 2016.

14.  Notwithstanding the Claimant’s allegation that the banking records were “forged”, the Adjudicator was plainly entitled to find as a fact that the Defendant did transfer the first 5 payments received from the Claimant to Toyo.  Any other conclusion would be perverse on the evidence and materials before him.

THE ADJUDICATOR’S DECISION

15.  At paragraph 17 of the Judgment, the Adjudicator posed two questions which he considered to be the key issues which he had to decide, namely:-

(1)  Whether the Defendant was an agent of the Claimant in Hong Kong?

(2)  If so, whether the Defendant received the Monies as agency fee, contrary to section 57 of the Employment Ordinance and section 10 of and Part II of Schedule 2 to the Employment Agency Regulations?

16.  In respect of the first issue, the Adjudicator found that the Defendant was the Claimant’s agent (see paragraph 18 of the Judgment).

17.  In respect of the second issue, the Adjudicator, instead of deciding whether the Defendant received the Monies from the Claimant as agency fee contrary to the relevant regulations, stated that he was not convinced that “the Monies were pocketed by the Defendant” (see paragraph 23 of the Judgment).

18.  At paragraph 36 of the Judgment, the Adjudicator concluded as follows:-

“In light of the above discussions, I find that the Defendant was an agent of the Claimant. However, I also find that the Defendant had not pocketed the Monies paid by the Claimant, be it for agency fee or otherwise. As such, the Claimant’s claim against the Defendant is dismissed.”

CLAIMANT’S PROPOSED GROUNDS OF APPEAL

19.  In her Amended Application for Leave to Appeal on Point of Law (Form 9) dated 11 May 2018, the Claimants raises the following intended grounds of appeal:-

Ground 1:  failure to inquire, summon witnesses and require production of documentations on relevant matters as required by Section 16(3) of the Small Claims Tribunal Ordinance, Cap 228 (“the Ordinance”).

Ground 2:  failure to take relevant factors into account.

20.  Details of these two proposed grounds of appeal are fully set out in the Form 9 and further elaborated in Mr Chan and Ms Lam’s Written Submission dated 10 July 2018 which I do not propose to repeat in this decision.

DISCUSSION

21.  As earlier mentioned, the Adjudicator dismissed the Claimant’s claim on the essential basis that the Defendant “had not pocketed” the Monies paid by the Claimant.  In reaching his decision to dismiss the claim, the Adjudicator did not answer the second key question which he had identified, namely, whether the Defendant received the Monies from the Claimant as agency fee contrary to the relevant regulations.  In my view, it is reasonably arguable that the mere fact that the Defendant had not pocketed the Monies, in the sense that the Defendant had transferred the Monies to Toyo shortly after receipt of the same from the Claimant, should not be regarded as being determinative of the Claimant’s claim.  This is because the fact that the Defendant transferred the Monies to a third party (in this case Toyo) might have been for its own reason, and may not, in any event, be capable of forming the basis of a legal defence to the Claimant’s claim if the true nature or character of the Monies received by the Defendant was agency fee or commission which the Defendant was not entitled to receive as a matter of law.

22.  In order to reach a proper conclusion on the second key issue posed by the Adjudicator, it seems to me that the following matters are, or could be, relevant considerations:

(1)  whether the aforesaid loan documents were forged;

(2)  whether the Claimant ever obtained any loan (in the amount of HK$20,400 or some other amount) from Toyo;

(3)  what were the circumstances in which the Claimant made the payments to the Defendant, in particular whether (i) she made the payments to the Defendant as directed by East Asia in the belief that they were required to cover the cost of her air fare to Hong Kong and other expenses relating to the processing of her work visa (as the Claimant contends), or (ii) she requested the Defendant to transfer the Monies to Toyo on her behalf (as the Defendant contends);

(4)  what was the basis on which the Defendant (i) received the Monies from the Claimant, and (ii) transferred the first 5 payments to Toyo; and

(5)  what was the true nature of the payments made by the Claimant and received by the Defendant.

23.  Some of these matters were briefly or tangentially considered by the Adjudicator in paragraphs 31 to 35 of the Judgment, but the Adjudicator did not fully inquire into them and reach a conclusion on the second key issue.  It is, I consider, reasonably arguable that the Adjudicator’s failure to do so constitutes a failure to inquire under Section 16 of the Ordinance.  Sine I am dealing only with an application for leave to appeal, I do not propose to express any further views on this matter.  Ground 1 of the Claimant’s proposed grounds of appeal is, in my view, a ground involving a question of law on which leave to appeal ought to be granted under Section 28(1)(a) of the Ordinance.

24.  In passing, I should mention that different consideration may apply to the 6^th payment made by the Claimant, which was paid directly to Toyo and not through the Defendant.  This is not an issue which needs to be resolved in the present application for leave to appeal, but may require further consideration at the substantive hearing of the appeal.

25.  As accepted by Mr Chan, Ground 2 of the Claimant’s proposed grounds of appeal essentially raises the same point as Ground 1.  It is not necessary, for the present purpose, to give separate consideration to this ground.

DISPOSITION

26.  For the foregoing reasons, I grant the Claimant leave to appeal against the Adjudicator’s order dated 8 November 2017.  The costs of this application shall be in the cause of the appeal.