Chan Siu Fung and Others v. Man’s Brothers Construction Co Ltd

HCLA 46/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 46 OF 2015

(On appeal from Labour Tribunal Claim No. LBTC 2018/2015)

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AND

HCLA 47/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO. 47 OF 2015

(On appeal from Labour Tribunal Claim No. LBTC 1802/2015)

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(Heard together)

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REASONS FOR JUDGMENT

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1.Man’s Brothers Construction Company Limited (“the Company”) is the common defendant in two separate proceedings in the Labour Tribunal under LBTC 1802 of 2015 and LBTC 2018 of 2015 instituted by a number of painting workers for their alleged outstanding wages. After hearing the trial of these two proceedings together, Mr LC Cheng, the presiding officer, allowed the claims of the workers against the Company. He further handed down his reasons for his decision on 18 January 2016 (“the Decision”). With leave granted on 25 February 2016, the Company appealed to this court. At the conclusion of the hearing, this court dismissed the appeal and indicated that the reasons for the decision would be handed down. And this I now do.

2.The background facts can be briefly stated as follows. The Company was a subcontractor in respect of a construction project in Ma On Shan (“the Site”). The Company agreed to be subcontracted certain painting works thereat. The claimants carried out such works on its behalf at the Site.  The claimants accepted that they had been the independent contractors of the Company in respect of such painting works completed by them.

3.Mr CW Man is the sole shareholder of the Company. He claimed that the claimants were mere independent contractors throughout whereas the claimants insisted that after they had finished the painting works under the sub-contract with the Company, they became the employees of the Company to be paid on a daily basis in respect of other painting works at the Site.

4.Mr SK Man, the brother of Mr CW Man, worked as a supervisor for the Company overseeing the painting works undertaken by the Company at the Site. He testified for the claimants and he confirmed that he paid wages to the claimants on a daily basis at the rate of HK$950 per day on behalf of the Company.

5.The presiding officer preferred the evidence of Mr SK Man to that of Mr CW Man, whom he found to be dishonest, and found as a matter of fact that the Company employed all the claimants.

6.The Company includes the following grounds as its grounds of appeal:

(1) There is no or no sufficient evidence for the finding of the existence of any employment contract between the Company and the claimants;

(2) There is no or no sufficient evidence for the finding of the existence of any instructions to Mr SK Man to enter into any employment contract with the claimants for and on behalf of the Company;

(3) There is no dispute between the parties as to the existence of a sub-contract between the claimants and the Company form August 2012 to July 2013. However, there is no or no sufficient evidence for the finding that an employment contract came into play suddenly effective from 1 August 2013 onwards and both the sub-contract and the employment contract co-existed until January 2014.

(4) The computer records relied upon by the claimants made no distinction of the hours spent by the claimants on the employment contract if there was one, and the sub-contract.

(5) The presiding officer failed to take into account the payments by the Company to Mr Tang, one of the claimants.

General principles

7.Before I go further into the grounds, I remind myself of the following applicable principles relevant to this appeal.

8.Section 32(1) of the Labour Tribunal Ordinance, Cap. 25 confines grounds of appeal to those allegations of errors in law or excess of jurisdiction. On such appeals, this court may draw any inference of fact but may not reverse or vary any determination made by the tribunal on questions of fact: section 35(2).

9.In Kwong Miles Services Ltd v Commissioner of Inland Revenue [2004] 3 HKLRD 168 at §37, Bokhary PJ said this:

“In any appeal on law only the appellate court must bear in mind what scope the circumstances provide for reasonable minds to differ as to the conclusion to be drawn from the primary facts found. If the fact-finding tribunal’s conclusion is a reasonable one, the appellate court cannot disturb that conclusion even if its own preference is for a contrary conclusion. But if the appellate court regards the contrary conclusion is true and only reasonable one, the appellate court is duty-bound to substitute the contrary conclusion for the one reached by the fact-finding tribunal.”

Grounds 1, 2 & 3

10.All these three grounds relate to the factual question as to whether the alleged employment of the claimants by the Company existed in addition to the sub-contract. On this issue, the presiding officer principally relied on the evidence of Mr SK Man, which he found to be supportive of that of the claimants, to make a positive finding that the claimants were also the employees of the Company.

11.The presiding officer first summarised with approval the evidence of the claimants to the effect that after the completion of the sub-contract works, dripping problems emerged in certain parts of the buildings constructed at the Site. Such parts were dampened and required painting works. Mr SK Man’s evidence was that he on behalf of the Company agreed to employ the claimants from August 2013 onwards and their wages were to be computed at a daily rate of HK$950. He further made it clear that such painting works did not fall within the ambit of the sub-contract completed by the claimants.

12.These are clearly findings of fact. Nothing in the submissions of Mr Cheung, for the Company, can convince me that this court has good reason to disturb such factual findings of the presiding officer. He was of course entitled to prefer the evidence of Mr SK Man. I cannot accept that there was no or no sufficient evidence to support his finding of employment as alleged.

13.As regards the alleged lack of instructions on the part of Mr SK Man, Mr Cheung did not make any specific attack on the relevant finding of fact apart from the general credibility of Mr SK Man. I see no merit in his challenge.

14.Mr Cheung indeed took a realistic approach in this appeal and focuses his submission on the fact that the presiding officer did not in the Decision make a specific finding of the time of termination of the sub-contract. In the absence of such a finding, he submits that the perverse conclusion of the presiding officer is that both the sub-contract and the employment of the claimants co-existed. Therefore, it would not be difficult if not impossible to distinguish such painting works done in the course of the employment and those carried out in performance of the sub-contract.

15.I am unable to accept this submission. As explained above, the evidence adduced by the claimants and accepted by the presiding officer is that their employment was only subsequent to the completion of the sub-contract: see §9 of the Decision. The presiding officer did not conclude that there was ever a period when the sub-contract and the employment co-existed.

16.Mr Cheung refers to §16 of the Decision where the presiding officer considered the issue of delay of the claimants in making their claims in the Labour Tribunal. He accepted the evidence of the claimants that the Company asked them to wait until the conclusion of the works at the Site for the release of their wages. As a result, the claimants waited until the conclusion of the works at the Site to seek help from the Labour Department. From this, Mr Cheung submits that it can be inferred that the sub-contract works were not completed even after the claimants had finished their painting works under their employment and they were made to wait until its completion to make their claims.

17.I must reject this submission. In the first place, it is clear that the presiding officer has already made a factual finding that the employment was only commenced after the completion of the sub-contract.

18.Moreover, the reference to the completion of works at the Site does not necessarily mean the completion of the subcontract works undertaken by the Company at the Site. The construction project at the Site must include many different types of works other than the painting works undertaken by the Company. When the claimants were told to wait for the completion of the works at the Site for their wages, it can mean that they had to wait until the completion of all the construction works at the Site and not just the sub-contract works. Mr Cheung agrees that it is a possible interpretation. In my view, it is the correct interpretation in light of the foregoing evidence accepted by the presiding officer.

Ground 4

19.This ground is based on the alleged co-existence of the sub-contract and the employment. By reason of my conclusions relating to Grounds 1, 2 & 3, this ground is baseless.

Ground 5

20.The Company relies on three cheques issued to Mr Tang in August, October 2013 and January 2014. Mr Cheung complains that the presiding officer has failed to take into account these payments during the currency of both the sub-contract and the employment. He submits that these payments show that the sub-contract and the employment did co-exist.

21.This ground is devoid of merit. The presiding officer did consider these three cheque payments referred to in a table adduced as an exhibit. The presiding officer concluded that they only represented the payments by the Company for the sub-contract works undertaken by the claimants: §20 of the Decision. The presiding officer specifically refused to find against the existence of the employment merely because the claimants had been at one stage a sub-contractor of the Company.

22.I agree with the presiding officer. I too cannot accept that these payments made to Mr Tang on behalf of the claimants for the sub-contract works must necessarily indicate that the sub-contract had not been terminated. Payments could be, and indeed not rarely, made well after works and services have been rendered and in this case, the conclusion of the sub-contract.

Conclusion and Order

23.None of the grounds advanced on behalf of the Company has any merit. Accordingly, I dismissed the appeal.

24.There is no reason why costs should not follow the event. I make an order that the Company do pay the claimants their costs of its appeal.  In regard to the 5^th and 9^th claimants, I allow legal aid taxation for their own costs.

Mr Ivan Cheung, instructed by Wong & Lawyers for the Defendant (Appellant) in HCLA 46/2015 and 1^st Defendant (Appellant) in HCLA 47/2015

Mr Sunny Chan, instructed by V. Hau & Chow for 1^st to 4^th, 6^th to 8^th Claimants (Respondents) in both actions

Ms Tjia Luk Ying, instructed by V. Hau & Chow assigned by the Director of Legal Aid, for 5^th and 9^th Claimants (Respondents) in both actions

10^th Claimant (Respondent) in HCLA 46/2015, in person, absent