YUEN OI YEE LISA v. HEATH CO LTD AND OTHERS

HCMP 2038/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 2038 OF 2004

(On an intended appeal from DCCJ No. 5441 of 2003)

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D E C I S I O N

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Hon Rogers VP:

1. I agree with the judgment of Tang JA and have nothing to add.

Hon Tang JA:

2. The plaintiff was employed under probation by the 1^st defendant between 15 October 2002 and 6 March 2003.

3.  The 1^st defendant has admitted that their human resources officer contacted three ex-employers of the plaintiff in or about February 2003 to obtain references of the plaintiff without proper authority from the plaintiff.

4. The plaintiff was aware of the identity of one of the three ex-employers.  The identity of the other two has not been disclosed. 

5. The plaintiff’s claim against the 1^st defendant was made under section 66 of the Personal Data (Privacy) Ordinance in respect of the contact with the two unidentified ex-employers.

6. The 1^st defendant applied to have the claim struck out on the basis that the claim was covered by a settlement agreement.

7. The plaintiff does not accept that the settlement covered these two ex-employers.  And this is how the plaintiff put it in her Statement of Claim :

“The payment of legal cost and the apology letter were delivered in full and final settlement of ‘Defamation’ in relation to one ex-employer, Strombecker Hong Kong Limited only but excluding the other two ex-employers whose names the defendant still insisted ‘NOT’ to be disclosed.  As I did not know the names of two ex-employers or were there any further defamatory statements and made against me to another two unknown ex-employers, I asked to reserve my legal rights on these two unknown ex-employers.”

8. Judge C.B. Chan struck out the claim.

9. The plaintiff has applied to us for leave to appeal.

10. The settlement relied on by the 1^st defendant is evidenced by correspondence exchanged between solicitors then acting for the plaintiff and the 1^st defendant respectively.  The plaintiff’s solicitors, S.H. Chan & Co.’s wrote in their letter of 20 May 2003 :

“	We refer to the without prejudice telephone conversation between your Miss Wong and our Mr William Cheung this morning.
	We are instructed that for an amicable settlement and a gesture of goodwill, our client is willing to accept your proposals as follows:-
	1.	Your client shall pay our client’s legal costs in the total sum of HK$20,000.00.
	2.	Your client shall deliver an apology letter to our client on terms as set out in paragraph 3 of your letter to us dated 25 April 2003 with the necessary amendment to be made to paragraph 3(1)(c) in relation to the sum of legal costs payable to our client.
	3.	Your client and its holding company shall waive any claim against our client in relation to any allegation of harassment.
	4.	The payment of legal costs is made and the apology letter is delivered in full and final settlement of any civil claim in relation to this matter.
	To expedite the matter, please send the above apology letter together with the payment of HK$20,000.00 to us, for and on behalf of our client, within the next 5 days.”

11. Paragraph 3 of the letter of 25 April 2003 is as follows :

“	3.	Without prejudice to our client’s position stated above, our client nevertheless wishes to settle the matter with your client amicably, hence saving all parties’ costs and time.  In full and final settlement of any claim of your client against our client and/or Desa International Inc. and/or HIG Capital in relation to this matter and/or your client’s dismissal by our client, on an entirely without prejudice basis, we are instructed that:-
		(1)	our client is prepared to deliver to your client a written apology under the name of Heath Company Limited on the following terms:-
			(a)	our client regrets that Miss Sally Chong, without proper authority from our client, inappropriately contacted your client’s ex-employers for obtaining your client’s references;
			(b)	our client shall use its best endeavour to restrain any defamatory statement to be made against your client by any staff of our client; and
			(c)	as a gesture of goodwill, our client shall make payment to your client of the sum of HK$8,000 being your client’s legal costs incurred in this matter.
		(2)	as the improper act was committed by the Human Resources Officer of our client and your client’s allegations do not relate to any act of our client’s holding companies, be it Desa International Inc. or HIG Capital in the U.S.A., we do not consider it necessary or appropriate for such written apology to be copied to those holding companies of our client.
		…”

12. The 1^st defendant’s solicitors, Johnson Stokes & Master, replied on 26 May 2003 :

“Thank you for your letter of 20th May 2003.
In full and final settlement of the dispute between our respective clients, we now enclose:-
1.	an apology letter from our client to yours on the terms as set out in paragraph 3 of our letter to you dated 25th April 2003; and
2.	our cheque in the sum of HK$20,000 drawn in your favour being payment of your client’s legal costs in this matter.
Kindly acknowledge receipt.”

13. The apology letter which was dated 24 May 2003 is in the following terms :

“Re:  Apology Letter

We regret that our Human Resources Officer, Ms. Sally Chong, without our proper authority, inappropriately contacted your ex-employers for obtaining your references.  We shall use our best endeavour to restrain any defamatory statement to be made against you by any of our staff.  As a gesture of good will, we now make payment to Messrs. S.H. Chan & Co., your legal representative of the sum of HK$20,000 being your legal costs incurred in this mater.

The payment of legal costs is made and this letter is delivered in full and final settlement of any claim which you have or may have against us.”

14. We are satisfied that the settlement evidenced by the letters referred to above covered any claim which the plaintiff had or might have had against the 1^st defendant in relation to the contact made by or on behalf of the 1^st defendant to all three ex-employers.

15. S.H. Chan & Co.’s letter dated 20 May 2003 referred to a without prejudice telephone conversation between one Miss Wong of Johnson Stokes & Master and Mr William Cheung of S.H. Chan & Co.  The plaintiff submitted that if the content of such without prejudice conversation was relevant then she should have been given an opportunity to adduce evidence from Mr William Cheung.  She submitted that she was led by the judge into believing that such evidence was irrelevant.  But whether she had been led by the judge into so believing is unimportant, we are clearly of the view that the content of the without prejudice conversation is inadmissible to help to explain the clear language used by the parties in the correspondence quoted above.

16. The plaintiff also argued that the settlement agreement was made on terms of the letter written by S.H. Chan & Co. to Johnson Stokes & Master dated 16 May 2003.  This argument is incorrect.  It is quite clear from the letters quoted above that the settlement was made on the terms disclosed in the letters of 20 May and 26 May 2003.

17. For the above reasons, we do not believe that it will be right to grant leave to appeal.  Leave to appeal is refused.  We also make an order nisi that the 1^st defendant is to have the costs of this application.  The order shall be made absolute without further order unless the plaintiff makes written submissions to the contrary within 14 days of today.