LEE TIM AND OTHERS v. CHOW SUK CHING t/a WANG CHONG CO.

IN THE COURT OF APPEAL

1996, No. 164

(Civil)

______________

______________

______________

J U D G M E N T

______________

Godfrey, J.A. :

Introduction

1. This is an appeal from an order of the High Court, made on 1 July 1996 by Cheung, J., whereby the judge allowed an appeal by Lee Tim, Fok Kuen and Leung Hui Wing ("the claimants") against a decision of the Labour Tribunal (Presiding Officer Barnabas W. Fung) on 8 January 1996 refusing the claimants the awards under various heads (wages in lieu of notice of termination, annual and statutory holiday pay, and severance pay) which they had sought from the Labour Tribunal. The case for the claimants as it developed was that they were or had been employees of one Chow Suk Ching, trading as Wang Chong Co. ("the respondent"). The case for the respondent was that the claimants were not and never had been employees of the respondent. The Presiding Officer agreed with the respondent; but the judge was of the opinion that, as he put it, "the only reasonable conclusion from the evidence is that [the respondent] had been the employer of the claimants" (emphasis added). He therefore allowed the claimants' appeal and directed that the awards they had sought be entered in their favour against the respondent, the amount of such awards to be remitted back to the Labour Tribunal and assessed by the Presiding Officer. The respondent, with the leave of Liu, J.A. granted on 30 July 1996, now appeals to this court; the judge, says the respondent, was not entitled to interfere with the Presiding Officer's decision on the ground on which he did so. This is, in effect, a challenge to the jurisdiction of the judge to make the order which he made on 1 July 1996. In order to see whether or not this challenge to the judge's jurisdiction is justified, we must examine what exactly are the limits of the jurisdiction of the Lands Tribunal and the High Court respectively (and, I must add, of this court, too, since on an appeal from a decision of the High Court in relation to a decision of the Labour Tribunal our own jurisdiction is a limited one). But, before doing so, it will be convenient to summarise the facts of the case as found by the Presiding Officer.

The facts

2. The work on which the claimants were engaged was the off-loading at construction sites of bags of cement produced (since 1969) by the Green Island Cement Company. They lost this work, on which they had been engaged for years, when the plant ceased operations in 1994.

3. Mak Tung-shing, trading as Wing Sang Transportation Company ("Wing Sang") contracted with the Green Island Cement Company for the supply to it of the services of off-loaders. Wing Sang engaged one, Law Cheuk, to recruit the off-loaders. The claimants were recruited by Law Cheuk accordingly. The off-loaders would form themselves into (usually regular) groups; accompany the transport to the construction sites, and off-load the cement, returning in due course to Green Island Cement to wait for the next assignment. The "tally", another worker engaged by Wing Sang, would record who had worked on each assignment and the tonnage handled by the off-loaders. At the construction site the off-loaders would carry the cement only for 50 steps; if the distance exceeded 50 steps they would negotiate on extra payment with the site foreman and report this to the tally.

4. The off-loaders worked from Monday to Saturday and on alternate Sundays. Normal hours were from 8 a.m. to 4 p.m. They had the choice whether or not to work on any day. If they wanted to take leave, they might inform Law Cheuk, but it was not necessary to do so : Law Cheuk would pass the information on to the tally. Each morning the off-loaders would gather at the plant; the tally would tell them what work was available and how many off-loaders were needed. The Green Island Cement Company paid Wing Sang for the tonnage transported. The off-loaders were paid on Saturdays. The tally would pay Law Cheuk, by cheque, a lump sum calculated according to the tonnage of cement transported during the week, including an element for Law Cheuk. Law Cheuk would pay the off-loaders according to the tally's record. The off-loaders' daily pay (they received no other remuneration) would be calculated by dividing the total tonnage per day by the off-loaders working on that day. When Law Cheuk died in 1993, his work was taken over by one Pun Chun, on the same or similar terms. And, by the time the Green Island Cement Company ceased operations, Wing Sang had sub-contracted its operations for the plant to the respondent, so it was to the respondent that the claimants looked for satisfaction of their claims.

The jurisdiction of the Labour Tribunal

5. Under section 7 of the Labour Tribunal Ordinance, Cap. 25 ("the Ordinance"), the Labour Tribunal is given exclusive jurisdiction to inquire into, hear and determine claims of the sort advanced by the claimants here for awards such as those mentioned in the judge's order; save as provided by the Ordinance, such claims are not actionable.

The jurisdiction of the High Court

6. Section 32 of the Ordinance provides as follows :

"32. Leave to appeal on point of law

(1) If any party is dissatisfied with an award, order or termination by the tribunal on the grounds that the award, order or determination is -

(a) erroneous in point of law; or

(b) outside the jurisdiction of the tribunal,

such party may, within 7 days after the date on which the award, order or determination was served on him, or within such extended time as may be allowed by the Registrar of the Supreme Court on good cause, apply to the High Court for leave to appeal and the High Court may grant such leave.

(2) An application for leave to appeal under this section shall be -

(a) in the prescribed form which shall set out the grounds of appeal and the reasons in support of such grounds; and

(b) lodged with the Registrar of the Supreme Court.

(3) A refusal by the High Court to grant leave to appeal shall be final."

7. And section 35 provides as follows :

"35. Powers of High Court on appeal

(1) On appeal for which it has granted leave under section 32, the High Court may -

(a) allow the appeal;

(b) dismiss the appeal; or

(c) remit the matter to the tribunal with such directions as it thinks fit, which may include a direction to the tribunal for a new hearing.

(2) On an appeal for which it has granted leave under section 32, the High Court may -

(a) draw any inference of fact; and

(b) make such order as to costs and expenses as it thinks fit,

but may not -

(i) reverse or vary any determination made by the tribunal on questions of fact; or

(ii) receive further evidence.

(3) Subject to section 35A, the decision of the High Court shall be final."

The jurisdiction of the Court of Appeal

8. Sections 35A and 35B provide as follows :

"35A Appeal to Court of Appeal

(1) If any party is dissatisfied with a decision of the High Court on an appeal heard by leave given under section 32, such party may, within 7 days after the date of the decision, apply to the Court of Appeal for leave to appeal and, if the Court of Appeal considers that a question of law of general public importance is involved, it may grant leave.

(2) An application for leave to appeal under this section shall be -

(a) in the prescribed form, setting out the question of law; and

(b) lodged with the Registrar of the Supreme Court.

(3) A refusal by the Court of Appeal to grant leave to appeal shall be final.

35B. Powers of the Court of Appeal on appeal

On an appeal for which it has granted leave under section 35A, the Court of Appeal may -

(a) allow the appeal;

(b) dismiss the appeal; or

(c) remit the matter to the tribunal with such directions as it thinks fit, which may include a direction to the tribunal for a new hearing,

and may make such order as to costs as it thinks fit."

The judge's exercise of his jurisdiction

9. Section 7 of the Ordinance provides the background to the exercise by the High Court of the jurisdiction conferred on it by sections 32 and 35 of the Ordinance. It is obvious from section 7 that the legislature intended to ensure, no doubt in the interests of economy, speed and finality, that the Labour Tribunal should have a plenitude of jurisdiction over claims such as those made here. And it is equally obvious, from sections 32 and 35, that the legislature intended severely to circumscribe the powers of the High Court to interfere with a decision of the Labour Tribunal. The High Court may not reverse or vary any determination made by the Labour Tribunal on questions of fact (although it may draw any inference of fact, which must, I suppose, mean any inference consistent, but not at variance, with the Labour Tribunal's findings of primary fact). I conclude from this that it is not open to the High Court to substitute its own conclusions as to the effect of the evidence for those of the Labour Tribunal, save where the Labour Tribunal's view of the facts is one which could not reasonably be entertained. Of course, to take a view of the facts which cannot be reasonably entertained is to fall into error of law (which the High Court is entitled to correct) : ep. Lee Ting Seng v. Ching Chi Keung [1990] AC 374 at p.388, citing Lord Simonds in Edwards v. Bairstow [1956] AC 14 at p.29.

The Court of Appeal's exercise of its jurisdiction

10. Accordingly, I agree with Liu, J.A. (although I would, I think, have put the point somewhat differently from the way Liu, J.A. put it in granting leave to appeal) that a point of law, of general public importance, does arise here. The point is this : Is the judge of the High Court, on an appeal from the Labour Tribunal, limited to a consideration of the primary facts found by the Presiding Officer in order to determine whether, on those facts, the only reasonable conclusion was the opposite one to that reached by the Presiding Officer; or is he entitled to consider all the evidence before the Presiding Officer for that purpose? In my judgment, he is not so entitled. If the only reasonable conclusion from the facts found by the Presiding Officer here is that the respondent had indeed been the employer of the claimants, then, certainly, the Presiding Officer must be regarded as having fallen into error of law, thus justifying the intervention of the judge of the High Court. If, however, it was in our case open to the Presiding Officer reasonably to conclude, from the facts found by him, that the respondent had not been the employer of the claimants, then it is the judge who has fallen into error of law in holding, as he did, that the only reasonable conclusion was that the respondent had been the employer of the claimants. In those circumstances, we would be entitled, and indeed bound, to set aside his decision, and restore that of the Presiding Officer. The judge of the High Court is not entitled to substitute his own evaluation of the evidence for that of the Tribunal.

The result

11. I am of the opinion that it was open to the Presiding Officer here reasonably to conclude, from the primary facts found by him, that the respondent had not been the employer of the claimants. The judge fell into error in holding that the only reasonable conclusion would have been otherwise. It seems to me that the error into which the judge fell may have been caused by a misapprehension as to the approach he was obliged to follow in considering the facts of the case. It will be recalled that the judge in our case held that the only reasonable conclusion "from the evidence" was that the respondent had been the employer of the claimants. This suggests that the judge approached the matter by evaluating the evidence for himself and then deciding, as a result of his own evaluation of the evidence, that the Presiding Officer had come to the wrong conclusion. If this is what the judge did, it was, in my respectful opinion, impermissible. The judge was, certainly, entitled to consider the Presiding Officer's findings of fact and to hold, if he felt obliged to do so, that the only reasonable conclusion on them would have been a conclusion opposite to that reached by the Presiding Officer. But that is not what he did; at least it does not appear so. Accordingly, I would hold that the judge fell into error in substituting his own view of the evidence for that of the Presiding Officer. The evidence might, I accept, have led the Presiding Officer to the conclusion that the respondent was the employer of the claimants; there were a number of facts proved before him which pointed that way. But it might equally well have led him to a different conclusion; e.g., that the claimants were the employees of Law Cheuk (and, after his death, his successor Pun Chun); or that they were self-employed and not employees at all (cp. Chang Yuen v. The Royal Hong Kong Golf Club, CA 146 of 1996, 7 January 1997, unreported). His decision that the claimants were not the employees of the respondent was one which was not in any way inconsistent or at variance with his findings of primary fact.

Conclusion

12. I would therefore allow this appeal and restore the decision of the Lands Tribunal dismissing the claimants' applications for awards here under the Employment Ordinance, Cap. 57. Such awards can be made only in favour of an "employee" against an "employer". This legislation should, perhaps, be re-considered, and its protection afforded to workers who make their services available to contractors in the construction industry in the way which this case exemplifies; but that is not a matter for us.

Jerome Chan, J. :

13. I concur.

Litton V-P:

14. I have had the advantage of reading in draft Godfrey JA's judgment, where the findings of fact made by the Presiding Officer have been conveniently summarised.

15. An important finding made by the Presiding Officer was that the claimants were never part of the organization of the respondent, as the tally-man clearly was. Another finding was this: It was Law Cheuk who paid the off-loaders, not Wing Sang: Wing Sang paid Law Cheuk a lump sum every Saturday calculated according to the tonnage of cement transported during the week and Law Cheuk in turn paid the off-loaders their wages. From all the facts found, it was clearly open to the Presiding Officer to conclude that the off-loaders were casual workers and as such either self-employed or employed by Law Cheuk. Nothing suggests that after Law Cheuk died in November 1993, and Pun Chun took over, things were materially different. The Presiding Officer was plainly entitled to conclude that the claimants were not the respondent's employees.

16. Once this point is reached, the conclusion is inevitable that the judge has erred. The Presiding Officer has not exceeded his jurisdiction in determining the claims the way he did. There was accordingly no error of law.

17. This appeal is allowed. The judge's order of 1 July 1996 is discharged and the decision of the Presiding Officer of 8 January 1996 is restored.