HO SHUI TAK v. WAN KEI GEOTECHNICAL ENGINEERING CO LTD AND OTHERS

DCEC8/2003

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES' COMPENSATION CASE NO. 8 OF 2003

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RULING

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1. On 7 January 2003, the applicant filed with the court an Application for:

1. Leave to cancel the Certificate of Review of Compensation Assessment issued on 28 November 2002 pursuant to section 16B(1) of the Employees' Compensation Ordinance, and

2. Leave to appeal the assessment of 2% loss of earning capacity by the Commissioner pursuant to section 18 of the Ordinance.

2. The applicant's case is that he met with an accident on 23 February 2000, arising out of and in the course of his employment with the 1st or the 2nd respondent at a construction site at which the 3rd respondent was the principal contractor.

3. On 2 March 2000 the 3rd respondent filed with the Labour Department a Form 2, reporting the accident. The Employee's Compensation (Ordinary Assessment) Board issued, on 31 July 2001, a Certificate of Assessment in Form 7 under section 16F of the Ordinance, certifying periods of absence from duty necessary as a result of the injury from 23 February to 24 April 2000, 26 April 2000 to 30 April 2000 and 2 May 2000 to 17 July 2001, and further certifying a 2% permanent loss of earning capacity caused by the injury.

4. On 7 April 2001, the Commissioner issued a Certificate of Compensation Assessment in Form 5, under section 16A(2) of the Ordinance assessing a total amount of $263,695.63 as compensation for the periods of absence from duty and for the loss of earning capacity assessed by the Board.

5. On 25 June 2002 the Board issued a Certificate of Review of Assessment in Form 9, under section 16G(3)/16GA(4) of the Ordinance, certifying further periods of absence from duty as necessary as a result of the injury, from 9 August 2001 to 23 February 2002 and from 18 March to 10 June 2002. The original assessed periods remained the same, as did the permanent loss of earning capacity.

6. On 28 November 2002, the Commissioner issued a Certificate of Review of Compensation assessment in Form 6, under section 16A(5) of the Ordinance, assessing a total figure of compensation of $352,215.36 for all the periods of absence from duty up to 10 June 2002, as well as the permanent loss of earning capacity, as assessed by the Board in the Form 9.

7. The applicant now applies by summons dated 22 February 2003 to amend the Application so as to apply for:

1. Leave to appeal the review of assessment of compensation by the Commissioner pursuant to section 18 of the Ordinance, (i.e. the Form 9) and

2. Leave to cancel the Certificate of Review of Compensation Assessment issued on 28 November 2002 pursuant to section 16B(1) of the Ordinance (i.e. the Form 6).

8. The respondents apply by summons dated 24 February 2003 for an order that the applicant's Application for relief out of statutory time limits be dismissed. They also oppose the summons for amendment of the Application.

9. The Respondents' argument is based on the statutory time limits provided in the Ordinance. They say that the applicant is out of time for all of them, except for that against the Certificate of Review of Compensation Assessment; and the Commissioner in any event had no power to make that assessment.

10. There are two routes by which an employee injured at work may obtain compensation. One is the administrative route whereby the Commissioner may assess the compensation payable. The other is by application to the District Court for a determination under section 18A. See Chung Lung Shun v Adams Parking International Ltd. [1996] HKLR 49.

11. By section 16A, the Commissioner may assess compensation payable under the provisions of sections 7, 9 and 10, and may issue a certificate of compensation assessment. The employer must pay the compensation within a time limit or be subject to a surcharge and the certificate may be made an order of the court for the purposes of enforcement. The various provisions governing this route appear in sections 16A to 16I of the Ordinance. In particular section 16D(4) empowers the Commissioner to refer to an Ordinary Assessment Board any claim for compensation for an injury to an employee of which he has notice if in the Commissioner's opinion, such injury is likely to result in permanent total or partial incapacity.

12. By section 18, appeal lies to the District Court from any decision or assessment of the Commissioner, an Ordinary Assessment Board or a Special Assessment Board under section 16A, 16D, 16E, 16G or 16GA, and the time limit for such appeal is six months. Again the court has a discretion to extend time but without the need for proof of reasonable excuse. Section 18(3) sets out the powers of the court on such appeal as follows:

(3) On an appeal under this section, the Court may confirm or reverse any decision, or confirm or vary any assessment, of the Commissioner, an Ordinary Assessment Board or a Special Assessment Board, or may substitute its own assessment, and may determine the amount of compensation payable and may make such order i n respect thereof, including any order as to costs, as it thinks fit.

13. Section 16B provides:

(1) Notwithstanding anything in section 16A, the Court may, on application by the employer, the employee, the Commissioner or the ECAFB, cancel a certificate issued under section 16A(2) or (5) and make such order (including an order as to any sum already paid under the certificate) as in the circumstances the Court may think just, if it is proved that-)

(a) the sum paid or to be paid was or is not in accordance with the provisions of this Ordinance; or

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

(c) the certificate was based upon any false or misleading information or statement given or made.

(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.

14. Necessarily the administrative route can only be taken where there is no dispute as to liability. The decision of the Commission or the Board is binding unless objected to under the various provisions, or appealed under section 18. See Ng Ming Cheong v Mass Transit Railway Corporation [1997] 3 HKLRD 1231.

15. The other route is by application to the District Court for a determination under section 18A. This is appropriate where there is a dispute on liability; see Ng Ming Cheong. A section 18 appeal may be included in, or consolidated with, a section 18A application or the answer thereto.

16. By section 14, the time limit for the section 18A application is 24 months from the date of the accident, subject to the Court's discretion to deal with an application made out of time if it is satisfied that there is a reasonable excuse for the applicant's failure to apply within time. By section 18(2) the time limit for appeal to the court is six months. The court has discretion to extend time but in this case without the need for proof of reasonable excuse. The same applies in respect of the application under section 16B(2).

17. The Respondents argue that an application under section 18A made 35 months after the date of the alleged accident would necessarily be time-barred by the provisions of section 14. By the time the Application was filed the applicant was out of time for appeal against the Form 7 and Form 9 assessments, as well as the original Form 5 assessment. They also argue that by the provisions of section 16A(1A) the Commissioner had no power to issue the Form 6 certificate and that liability remains in issue in respect of the further periods of absence from duty assessed by the Board in the Form 9.

18. It is argued for the applicant that since his Application is made under section 18, and not under section 18A, the limitation period in section 14 has no application here. The Form 6 certificate was issued pursuant to section 16A(5) on 28 November 2002 and, applying the 6 months period, is not out of time. Appeal against assessment under section 16A(1) is available under section 18(1). As to liability, this has never been in issue; if it had been the Commissioner could not and would not have referred the claim to the Board for the Form 7 certificate or issued the Form 5 certificate; and in any event the respondents never objected to or appealed against them. The applicant takes issue with the respondent's arguments on the effect of section 16A(1A) and says that the applicant is entitled to apply to the court for cancellation of the Form 9 certificate under section 16A(5) if it is proved that the certificate was issued under a mistake as to the true nature or extent of the injury.

19. It is said that the applicant having accepted the assessments of the Board and the Commissioner now finds that his condition is worse than he thought. He did not have any MRI scan, so the hospital may have underestimated the extent of his injury. The Commissioner, when adopting the Board's assessment could have been acting under a mistake. There is at this stage no evidence to support this, but it would be a matter for the court to consider once the preliminary issue of the time limits is decided.

20. Section 16A(1A) provides:

(1A) 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.

21. The respondents refers to the case of Choy Hiu Ling v New World Harbour View Hotel, CACV 410 of 2000 and in particular to the views expressed by Keith JA as to the interpretation of that subsection. It was argued that the claim must be notified to the Commissioner within the two year period under section 16A(1A). His Lordship suggested two further possible constructions, the first being that "arises" means "is made", i.e. the claim arises when it is notified to the employer, and the second being that it arises when the employee realises that the accident caused an injury of a kind for which compensation under the Ordinance was payable.

22. In fact Keith JA, having suggested these two possible constructions declined to adopt either of them on the basis that on the facts of the case before him, it would serve no useful purpose to do so. Rogers VP at page 11 opined that that the possible meanings set out in Keith JA's judgment were not exhaustive. However he too did not feel it necessary to give a definitive interpretation.

23. The argument, as I understand it, is that the claim for the extra periods of absence from duty which gave rise to the Form 9 and Form 6 certificates came more than 2 years after the date of the alleged accident, and therefore the Commissioner had no power to entertain it. Either this claim arose when it was notified to the Commissioner for the purposes of the review which produced the Board's Form 9 assessment and the Commissioner's Form 6 certificate, or else it arose when the applicant realised that he had this further claim. Either way, it was outside the two-year period.

24. It is to be noted that in Choy Hiu Ling, the accident happened on 30 August 1993. No Form 2 was filed. The Commissioner was not notified of the accident before April 1996, i.e. more than two years after the accident. In the instant case however the Form 2 was filed on 2 March 2000. If the claim arose when the employer was notified or when the Commissioner was notified that was well within the two-year period; the Commissioner was entitled to refer to the Board for a Form 7 assessment and himself assess compensation under Form 5, which he did.

25. It is possible that the time when the claim arises could, as Keith JA said, be the time when the employee realises that he has had an injury of a kind for which compensation. But here the applicant realised that at the outset. What was assessed for the purposes of the Form 9 and Form 6 was not some new claim but a continuation of the effects of the injury which gave rise to the original claim.

26. In any event, the Form 9 and the Form 6 were reviews of what had gone before and had produced the Form 7 and Form 5 certificates. I cannot see that section 16A(1A) could operate to place a time limit on the Commissioner's or the Board's review of an earlier assessment. No doubt the administrative route must be embarked on within the two years but once it is embarked on there is no time limit by which it must be completed.

27. In support of the argument that liability in respect of the assessments in the Form 9 and Form 6 is in issue, the respondent relies on a correspondence between the Commissioner and the 3rd respondent between November 2001 and March 2002. The 3rd respondent asked whether the sick leave certificates for the period from 9 August to 10 December 2001 were work-related and attributable to the accident. The Commissioner replied that the sick leave was "possibly likely to be related to the accident" and asked whether the 3rd respondent agreed with his comments and admitted liability for the applicant's claim. The 3rd respondent replied that it had "no objection to your comments on the validity of the sick leave periods" but did not, in terms, say that it admitted liability for the claim.

28. I do not think there is anything in this. The 3rd respondent had never raised the issue of liability for compensation for the earlier sick leave periods, either on the basis that the accident did not arise out of or in the course of employment, or that the sick leave was not caused by the accident. The only question which might not have been agreed was causation in respect of the later sick leave periods. The 3rd respondent clearly accepted the Commissioner's view on causation. There was no need for it to say in terms that it admitted liability, because it obviously did.

29. So far as the application to cancel the Certificate of Review of Compensation Assessment issued on 28 November 2002 pursuant to section 16B(1) of the Employees' Compensation Ordinance is concerned, I am satisfied that the Commissioner had power to issue the certificate. The applicant applies for its cancellation under section 16B. Sub-section (2) thereof provides for a six months time limit, and the applicant is within that limit. The 24 months time limit provided for in section 14 has no application to anything but proceedings under section 18A and is irrelevant here. The applicant is entitled to attempt to prove that the Form 6 was issued in ignorance of, or under a mistake as to the true nature and extent of the injury. If he can do so, the court may make such order as it may think just, i.e. substitute its own assessment.

30. So far as the original appeal against the assessment of the 2% loss of earning capacity is concerned, there is perhaps more difficulty. This was originally assessed by the Board in the Form 7 dated 31 July 2001; and it was not changed when the Board issued the Form 9 on 26 December 2002. Only the assessment in respect of the periods of absence from duty was changed. On the face of it, the time for appeal against assessment of the 2% loss of earning capacity is long past. It is certainly arguable that the proposed amendment, dealing as it is intended to with this assessment does not retrieve the situation, and if it does, the appeal is still out of time, if only by a couple of weeks.

31. However, the Form 6, of which the applicant seeks the cancellation, was issued on the basis both of the assessment of permanent loss of earning capacity and the assessment of all the periods of absence from duty as being necessary as a result of the injury. For the applicant to prove that the Form 6 was issued in ignorance of, or under a mistake as to the true nature and extent of the injury, he must necessarily prove that the Board's assessment of permanent loss of earning capacity was erroneous. Whether that assessment is taken as having been done for the purpose of the original Form 7, or the review which produced the Form 9, does not matter. It would in the circumstances be illogical to say that the applicant may continue to seek to prove mistake in the Form 6, but must remain bound by the Form 7 or the Form 9 assessment which gave rise to that mistake. I think that in the circumstances the proper course is to allow the appeal out of time under section 18(2).

32. It follows that the respondents' summons dated 24 February 2003 must be dismissed. In respect of this summons, I think the respondent must pay the costs, because there was never any substance in their objection to the applicant's application under section 16B; that was never out of time.

33. There will be an order in terms of the Applicant's summons dated 22 February 2003. In respect of that summons the costs will be in the cause; but they should be apportioned so that in respect of the hearing, no more than 10 minutes should be allowed in respect of the summons to amend, because by far the greater part of the time was spent on the respondents' summons.

34. Since this ruling is to be handed down these costs orders will be nisi. However the applicant's own costs are in any event to be taxed in accordance with the Legal Aid Regulations.

35. It is further directed that the respondents be at liberty to file their Answer and List of Earnings within 21 days from the order to be made herein, and the Application be adjourned sine die with liberty to restore.