廖建和及另九人 v. TREASURE CONSULTANTS LTD AND ANOTHER

HCLA 107/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 107 OF 2002

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NOS. 4722, 5874,
6439, 6440 & 6498 OF 2000 and 5794 OF 2002)

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D E C I S I O N

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1. On 9 October 2002, the representative of the 1st, 2nd and 4th Defendants, Mr Lam, who had been representing these Defendants at the trial at a number of hearings, was absent and another representative asked for an adjournment. I was told by counsel for these Defendants that by that stage, all the evidence had been heard and the outstanding part of the trial was hearing submissions from parties. The Presiding Officer granted the adjournment but imposed a condition, viz. that these Defendants should pay a sum of $1,700,000.00 into court to secure the claims of the Claimants by 16 October 2002.

2. The 2nd and 4th Defendants applied for review of the order and the review was dismissed by the Presiding Officer on 23 October 2002. On that date, the Presiding Officer amended the order of 9 October 2002, extended the time for payment into court to 29 October 2002 and indicated that if the Defendants failed to do so, the Tribunal may make an award against the Defendants. The proceedings were stayed against the 1st Defendant because it had been wound up.

3. The Defendants did not pay the money into court as ordered. The Presiding Officer made an award against the 2nd and 4th Defendants on 2 November 2002. The award in favour of the Claimants was assessed by the Presiding Officer and set out in an order dated 17 May 2003 as amended on 7 July 2003.

4. The 2nd and 4th Defendants applied for leave to appeal against the orders of 23 October 2002 on 2 November 2002 in HCLA 107 of 2002 and against the award of 2 November 2002 on 14 November 2002 in HCLA 115 of 2002.

5. Originally the application was to be heard on 24 January 2003. On 2 January 2003, solicitors for the 2nd and 4th Defendants wrote to the court to ask for hearing date to be refixed on the ground that the Presiding Officer's reasons for decision were not yet available and counsel needed time to prepare for the application. In this connection, I note that the Reasons for Decision were dated 31 December 2002 although there is a slight amendment by the Presiding Officer in his Supplementary Reasons for Decision on 19 May 2003. The request was acceded to by Deputy Judge Poon on 6 January 2003. According to the file records, the Reasons for Decision were sent to the solicitors for the 2nd and 4th Defendants on 13 January 2003. For some reasons unknown to me, these defendants did not apply to court for restoration of the application until 14 May 2003. As a result, the hearing did not take place until 22 July 2003. The perfected grounds of appeal were not filed until 21 July 2003 and the skeleton submissions were only handed to me at 9:30 a.m. before the hearing took place.

6. Let me say that this sort of delay is unacceptable. Although there is no stay of execution in the present case, any undue delay in the prosecution of an appeal is against the underlying philosophy for the setting up of the Labour Tribunal that cases should be disposed of quickly and efficiently. In the present case, the claims of the Claimants were in respect of their dismissals in 2000. Some of their claims were filed in August 2000 and some later. In his Reasons for Decision, the Presiding Officer rightly took into account of the undesirability of delay of the final resolution of the matter by unjustifiable adjournments.

7. It is not disputed that the Presiding Officer did have the power to make the orders of 23 October 2002. Sections 29A and 30 of the Labour Tribunal Ordinance clearly conferred such a power on a Presiding Officer. In the his skeleton submissions, Mr Yip (counsel for the 2nd and 4th Defendants) submitted that the Presiding Officer had overlooked several matters identified in paragraph 15 of his skeleton submissions and paragraph 1 of the Perfected Grounds of Appeal filed in HCLA 107 of 2002. His contention was that such oversights vitiated the exercise of discretion by the Presiding Officer.

8. The Presiding Officer gave cogent reasons for exercising his discretion as he did in his Reasons for Decision. He heard submissions from the parties, considered the circumstances leading to the fixing of the date of 9 October 2002, the reasons given on behalf of the Defendants as to the absence of Mr Lam, the progress of the trial and the delay an adjournment might cause, the Tribunal's previous stances to the other parties in view of their absence, the risk of dissipation of assets and claims being unsatisfied if there were further delay, the prejudice to the Defendants if no adjournment was granted, the ability of the Defendants to meet the condition of payment into court. He made a specific finding in paragraph 9 of his Reasons for Decision that should there be an adjournment, there were reasons to believe that the Defendants might dispose of or lose control of its assets to the prejudice of the Claimants. There is no challenge to such finding by the 2nd and 4th Defendants in these intended appeals.

9. Against that what Mr Yip said the Presiding Officer failed to consider were the stage at which the trial had proceeded to by 9 October 2002 and there was no history of default in compliance with the orders of the Tribunal by the Defendants. He submitted that an option opened to the Presiding Officer was to refuse the adjournment and conclude the trial on that date. It may be opened to the Presiding Officer to take such a course. But it does not mean that it was not opened to the Presiding Officer to adopt the course as he actually did. It is his discretion and this court would only intervene when his exercise of discretion was against principle or was so unreasonable that no reasonable court would exercise the discretion in that manner.

10. It has to be remembered that Sections 29A and 30 are there to confer the power on the Labour Tribunal to prevent prejudice caused to a party in the event of an adjournment caused by the other party. It is noteworthy that the powers under these sections could be exercised by the tribunal on its own motion. Hence, if a party so conducted himself in a case before the Tribunal which brought about an adjournment, the Tribunal would have the option of exercising its power under these sections even if the adjournment was not requested for by that party. In many cases, the exercise of the power under these sections to order payment into court is the most effective way to protect the interest of the other parties, especially when one is dealing with a case with risk of dissipation of assets. Unlike the District Court and the High Court, the Labour Tribunal does not have the power to grant a Mareva injunction and in my judgment, Presiding Officers should not hesitate to exercise their powers under Sections 29A and 30 to address such problems in appropriate cases. Having regard to the facts of the present case, I do not think one can argue that the Presiding Officer was acting so unreasonably that warrants intervention by this court simply because he granted an adjournment on terms as he did instead of refusing the adjournment. Because of the finding of risk of dissipation of assets, the parallel drawn by Mr Yip with ordinary unless orders granted in the High Court is not that apposite.

11. I do not accept Mr Yip's submission that if the Tribunal were to make an order for payment into court, that could only be done by an order for payment into court before the adjournment is granted by reason of the wordings under Section 30. Section 30 expressly stated that it was without prejudice to the generality of Section 29A. It is up to the Presiding Officer to decide whether time should be granted to a party for making the payment into court. In a case like the present one, where the sum involved was great, it is appropriate for the Presiding Officer to proceed under Section 29A instead of Section 30.

12. Based on what had happened before the Tribunal at the review of 23 October 2002 as set out in the Reasons of Decision of the Presiding Officer, I am of the view that he was entitled to conclude that his order of 9 October 2002 should be upheld. The reticence of the Defendants about their financial position was suspicious and might serve to heighten the concern about the risk of dissipation of assets.

13. I also see no merits in the submission of Mr Yip that the order of 23 October 2002 did not specify clearly the consequence of the failure to comply with the order for payment into court. The relevant order was in these terms,

"D2 及 D4 被告公司須於 29.10.2002 日下午3時正前共同及個别繳付款項$1,700,000.00 之保証金 (即根據2002 年10 月9日裁斷/命令所應付之保証金) 到本處,若D2 及D4被告公司未能遵從以上命令,本處可裁決D2及D4被告公司敗訴。"

14. Although the Presiding Officer used the words "可裁決" instead of "將會裁決", the important thing is that the Defendants had been told of the possibility of award being made against them in the event of non-compliance with the order for payment into court. The order was in accordance with the wordings in Section 29A(2) of the Labour Tribunal Ordinance. There cannot be any dispute that the 2nd and 4th Defendants were fully aware of the consequence of their failure to make the payment into court. Before they learnt of the order of 2 November 2002 (a copy of which, according to the Form 14 filed on their behalf in HCLA No.115 of 2002, was only delivered to them on 9 November 2002), their solicitors were able to file the Form 14 in the morning of 2 November 2002 in HCLA No.107 of 2002. Paragraph 1 of the intended grounds of appeal in that document stated that,

"The Presiding Officer erred in ordering that the Appellants to pay $1,700,000.00 as security, otherwise judgment would be entered against the Appellants."

15. I therefore see no arguable grounds of appeal in HCLA No.107 of 2002 and I dismiss that application for leave to appeal.

16. As regards HCLA No.115 of 2002, the Presiding Officer did not entered judgment against the 2nd and 4th Defendants immediately upon the expiry of the extended time limit for payment into court. He did so on 2 November 2002. As stated in paragraph 3 of his Reasons for Decision regarding this order, not only did these Defendants failed to make the payment into court, they did not furnish any reasonable explanation nor applied for further time to make the payment.

17. I do not agree with Mr Yip's submission that the Presiding Officer was obliged to invite submissions from the 2nd and 4th Defendants before he made the order of 2 November 2002. Given the underlying purpose of these sections and the rationale of the Presiding Officer behind the imposition of the condition for the grant of adjournment, and given that the 2nd and 4th Defendants were well aware of the likely consequence of their failure in complying with the order for payment into court (see paragraph 14 above), and having regard to what transpired before the Presiding Officer at the hearing of 23 October 2002, I am of the view that the 2nd and 4th Defendants had been given ample opportunities within the setting of the Labour Tribunal to make submissions regarding the consequence as to the non-compliance with the order for payment into court.

18. I therefore see no merit in the intended appeal in HCLA 115 of 2002. I also dismiss that application for leave to appeal. I propose to make this judgment available for circulation and if the 2nd and 4th Defendants have any views in that regard, they should be sent to the court within 5 days from the handing down of this decision.