Chok Kin Ming v. Equal Opportunities Commission

CAMP 51/2019

[2021] HKCA 212

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 51 OF 2019

(ON AN INTENDED APPEAL FROM HCLA 27 OF 2017)

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Before: Hon Cheung and Chu JJA in Court

Date of Judgment: 26 February 2021

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J U D G M E N T

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Hon Chu JA (giving the judgment of the court):

A.     Introduction

1.This is the claimant’s application under section 35A of the Labour Tribunal Ordinance, Cap. 25 for leave to appeal on questions of law of general public importance against the decision of Deputy High Court Judge Simon Leung (“the Judge”) given on 22 March 2019[1].  By the decision, the Judge dismissed the claimant’s appeal against the Labour Tribunal’s dismissal of his claim against the defendant.

2.The dispute between the parties arose from the decision of the defendant (“the Commission”) not to pay gratuity to the claimant at the expiry of his contract of employment. 

3.The claimant commenced proceedings in the Labour Tribunal to claim for payment of the gratuity.  By a decision dated 3 December 2015, Presiding Officer Chu Yuen Yee gave judgment for the claimant on his claim.  The Commission appealed to the Court of First Instance.  By his judgment handed down on 17 March 2017, G Lam J allowed the appeal and remitted the case to the Tribunal for determination[2].

4.The re-trial took place before Presiding Officer Jacqueline Lee, who dismissed the claimant’s claim on 28 September 2017.  The claimant’s appealed to the Court of First Instance.  The Judge dismissed the appeal. 

5.The claimant now seeks leave to appeal the Judge’s decision on the ground that three questions of law of general public importance are involved (see [53] below).  The Commission opposes the application.

6.Having considered the documents filed and lodged by the parties, we are of the view that it is appropriate to determine the present application without an oral hearing pursuant to Order 59, rule 2A(5) of the Rules of the High Court, Cap. 4A.  We now give our judgment on the application.

B.     The facts

7.The relevant facts of the case and the procedural background leading to the second trial were set out in detail in G Lam J’s judgment at [3] to [30] and also the Judge’s decision at [3] to [44].  For the present application, it is only necessary to give a summary of the salient facts.

B1.    The claimant’s employment

8.The claimant began his employment with the Commission in 1996.  His last contract was for three years from 1 November 2011 to 31 October 2014 as a Chief Equal Opportunities Officer.  The letter of offer stated, among other things, that subject to the terms in the Conditions of Service, the claimant would receive a gratuity for the period of service upon satisfactory completion of the agreement in the opinion of the Commission. 

9.Clause 13 of the Conditions of Service concerned the payment of gratuity.  The relevant part of clause 13.1 provided that:

“13.1 On satisfactory completion of the agreement in the opinion of the employer, … the employee will receive a gratuity in respect of the actual period of service …”

10.The claimant’s employment was also subject to a Code of Conduct, of which section D1.4 concerning conflict of interests is of relevance.  The relevant part of section D1.4 provided as follows:

“D1.4.1   All employees have an obligation to avoid financial, business or other relationships which might conflict with legitimate business interests of the EOC on the proper performance of its functions and powers. Employees must also avoid even a perceived conflict between their personal interests and those of the EOC.

D1.4.2   A conflict of interest situation arises when the personal interest of an employee competes or conflicts with the interest(s) of the EOC. Such a conflict will exist where an employee compromises his/her ability to act with total objectivity with regard to the Commission’s business interest or the proper performance of its functions and powers. Conflicts of interest may lead to divided loyalty and, in their most serious form, could result in corruption or fraud.

D1.4.3   Examples of conflicts of interest include, but are not limited to, the following:

…

•   where an employee is involved in any activity outside the EOC which is in direct opposition to the work of the EOC (eg: anti-gay/vilification of AIDS sufferers activist);

…

D1.4.4   It is the responsibility of every employee to report to his/her supervisor in situations where conflicts of interest may arise or have arisen, and make full disclosure of the interest of the employee (Form D1–D1.4.4 refers). Failure to do so may give rise to criticism of favouritism, abuse of authority or even allegations of corruption.

D1.4.5   The supervisor should decide, in consultation with the relevant division/unit head or the Chairperson as applicable, whether the employee may deal with, or continue to deal with, the case on situation where the conflict of interest has arisen.”

11.At a meeting on 22 July 2014, the claimant was informed by the chairperson of the Commission, Dr York Chow (“Chow”), that the Commission had decided not to continue with his employment when the contract expired.  A letter was handed to him, which stated that his performance and behaviour did not closely match with the requirements of his senior position.  Chow subsequently further explained the Commission’s decision to him in a memorandum dated 13 August 2014 in terms that were critical of his leadership ability.  The 22 July 2014 meeting ended with the claimant promising he would continue to act professionally during the remainder of the term of his employment and in the discrimination law review (“DLR”) that was being conducted by the Commission at the time.        

B2.    The DLR and the Forum

12.The DLR undertaken by the Commission was a comprehensive review of the existing discrimination laws with a view to considering how they could be modernized to meet the society’s needs.  It covered, among other things, aspects of sexual orientation and same-sex marriage.  The DLR consisted of five phases.  Public consultation was the second phase, which was preceded by an internal review by the Commission, and to be followed by an assessment of all the submissions and views received during the public consultation, drafting submissions and recommendations to the Government, and advising the Government on how the recommendations could be implemented.  The public consultation document contained 77 questions, and the three-month public consultation period was to conclude on 7 October 2014.

13.The claimant was one of the key members of the DLR taskforce.  He was responsible for explaining the objectives and proposals of the DLR to the public in consultation forums arranged by the Commission, which took place on 9, 16, 23 and 30 August 2014.

14.In the morning of 16 August 2014 (before the public consultation in the afternoon), the claimant gave a talk at a forum (“the Forum”) called “Briefing on DLR Consultation” (「歧視條例檢討」諮詢簡介會), which was organized by a church called Tsung Tsin Mission of Hong Kong (香港崇真會) (“the Church”).  It is the claimant’s case that he was invited to the Forum in his personal capacity and because of his Christian religion.

15.The Forum was open to members of the Church and attended by headmasters, teachers, and parents of students of the schools run by the Church.  On the claimant’s evidence in the re-trial, about 100 to 200 people attended the Forum. Members of the media had not been invited.  The claimant gave a talk and also distributed some written materials to the participants at the Forum.

16.Certain parts of the Forum, including the claimant’s speech, were recorded by someone without his knowledge or the organizer’s authorization. The transcript of the audio recording showed the claimant to have done the following[3]:

(1)  He told the audience that in other countries, enforcement of equal opportunities laws had often targeted at churches or schools.

(2)  He told the audience that he had tried very hard to insert Question 69[4] into the consultation document, but its scope was not wide enough.  He appealed to them to answer “Yes” to that question and to ask for an expansion of the exemption.

(3)  He urged the audience to answer “No” to certain other questions posed in the consultation document. 

(4)  He suggested a strategy of giving a very large number of responses to the consultation.  He gave the participants advice on how to make their views look independently formed and thus attract more weight with the defendant. 

(5)  He offered to help the participants present their views in a manner that would not be discounted, suggesting that when they sent their views to the Commission, they could use the template drafted by him with suitable variations.

(6)  He told the audience that he had objected to the Commission’s proposal to include same‑sex relationship within the protection of de facto marriage, and encouraged them to oppose the proposal.

(7)  He suggested that the ultimate aim of such legislation was to protect “sexual minorities”, which might ultimately lead to the removal of prohibition against all kinds of sexual practices including incest and bestiality.

(8)  He characterized the actions of the Commission on sexual orientation discrimination as pointless.

(9)  He mentioned to the participants at the forum about a previous incident of alleged discrimination involving a school and said that the Commission had caused it nuisance; and

(10)  He described the Commission as autocratic.

17.The claimant admitted in his evidence at the re-trial that at the Forum he had stated that he opposed same-sex marriage, and his PowerPoint presentation included suggestions on how to respond to Question 69[5].

18.On 26 August 2014, the newspaper Apple Daily published a report of what the claimant said at the Forum with verbatim quotes, and criticized the claimant for compromising the integrity of the Commission and the credibility of the DLR consultation.  This was followed by severe criticisms in the media against both the claimant and the Commission, including calls for the retraction of the entire DLR consultation.  The matter also attracted the attention of the Legislative Council. 

19.The Commission issued a media statement, in which it expressed regret and apology for the incident, explained that the claimant’s personal views on same‑sex marriage did not represent the position of the Commission and would not affect the DLR, and stated that the claimant would be discharged from his DLR duties with immediate effect so as to alleviate public concerns.

B3.    The Commission’s internal investigation

20.The claimant’s direct supervisor, Mr Joseph Li (“Li”) was tasked to investigate the matter.  Following Li’s email requesting the claimant to give his views and comments on the Apple Daily report, a series of email exchanges between them ensued, which were detailed in the Judge’s Decision at [19] to [25].  In short, the claimant questioned the purpose and nature of and the authority for the enquiry and requested Li to obtain the full audio recording from Apple Daily.  He also invoked the protection of his religious right to be free from discrimination, his right to freedom of expression, privacy of communication and freedom of conscience and religion under Articles 27, 30 and 32 of the Basic Law.  He further asserted that it was a private religious sharing on his religious belief with a group of restricted number of Christians of or related to that denomination, during his private time and without remuneration, and what he expressed at the Forum was his personal views. He denied there was any conflict of interest, and also told Li to abstain from the investigation as it should be carried out by external investigators.

21.The Commission subsequently received from an anonymous source an audio recording of parts of the claimant’s speech at the Forum.  Li provided the recording to the claimant and raised some questions for his response.  The claimant refused to comment on the ground that the recording was supplied anonymously, incomplete and not authenticated.

22.On 7 October 2014, Li provided his report (“Li’s report”) to Chow.  The report observed that (a) the forum was in substance an activity in public; (b) the claimant would not have been invited but for his employment with the Commission and the organizer had highlighted his involvement in the DLR consultation when introducing him; (c) the claimant did not clearly state his private capacity, but instead referred to his work in the DLR and his disagreement with his colleagues over aspects of the DLR; (d) the claimant held himself out as being closely connected with the Commission and the DLR, and his criticisms of the Commission could cause people to doubt the intention of the DLR exercise; and (e) the audio recording showed the claimant was steering the participants at the Forum and had made condescending comments on gay and cross‑dressed groups.

23.Li’s report concluded that the claimant (a) inappropriately or wrongly divulged office information taking advantage of his position and participation in DLR working group; (b) misled participants on the objective and proposals of DLR as well as the Commission’s operation, complaint mechanism and decision‑making process; (c) not only failed to clarify and defend the Commission’s operation publicly, but also created negative publicity on the Commission and its officers; and (d) acted in conflict with the Commission’s interest and was in breach of the Code of Conduct.

24.Chow’s evidence in the Tribunal was that the Commission considered the claimant’s conduct warranted summary dismissal, but decided, after deliberation, not to take this course having regard to the claimant’s long service since 1996 and the fact that his contract was coming to an end very soon (ending on 31 October 2014). 

B4.    The formal warning notice

25.As a disciplinary action, a formal warning notice was issued to the claimant on 10 October 2014.  The warning notice set out the claimant’s misconduct, and stated that the internal investigation had concluded that (a) he breached sections D1.4.2 and D1.4.4. of the Code of Conduct in that he had, inter alia, placed himself in a position of conflict by expressing his personal views rather than remaining impartial in the consultation process; and (b) he had breached his duty of fidelity and good faith in that he had, inter alia, misled the participants at the Forum about the Commission’s consultation methodology, operations and decision‑making process as well as the DLR’s objectives and proposals.

26.The warning notice further stated that the misconduct and investigation result outlined in the notice would be taken into consideration when deciding whether there had been “satisfactory completion” of the claimant’s employment contract which might have repercussions on his end-of-contract gratuity.  It informed the claimant he could appeal against the issue of the warning notice within 14 days.

27.The claimant signed on the warning notice to acknowledge receipt, and further wrote on it that he denied and disagreed with the outcome of the internal investigation.  He however, did not lodge an appeal against the issue of the warning notice. 

B5.    The Commission’s decision to withhold payment of gratuity

28.The claimant’s employment with the Commission ended on 31 October 2014. The Commission resolved not to pay him the end-of-contract gratuity being of the opinion that he had not satisfactorily completed the employment contract.  Notwithstanding this, on around 30 October 2014, the Commission made an offer to pay the gratuity on condition that the claimant signed a deed of release, the terms of which included a requirement that he gave a written apology for his actions at the Forum and promised not to make negative statement concerning the Commission or say or do anything prejudicial to its management or policies.  The claimant refused to sign the deed of release.  The Commission did not pay him the gratuity.

C.     Labour Tribunal’s first decision

29.On 16 February 2015, the claimant brought a claim in the Labour Tribunal against the Commission for non-payment of end-of-contract gratuity in the sum of HK$ 867,021.25 (LBTC 543/2015). 

30.After a trial, in which Chow’s witness statement was accepted as evidence without cross-examination, the Presiding Officer gave judgment for the claimant on his claim.  The Presiding Officer held that:  

(1)  As a matter of construction, the term “satisfactory completion” in clause 13.1 of the Conditions of Service referred to temporal completion of the contract, i.e. the completion of the three‑year term.  The Commission could not take into account the claimant’s work performance in deciding whether to pay him the gratuity.

(2)  Alternatively, if the above construction of clause 13.1 was wrong and the Commission could take into account the claimant’s work performance, the claimant did not fail to satisfactorily complete the employment contract.

D.    G Lam J’s decision

31.The Commission appealed the Tribunal’s decision to the Court of First Instance (HCLA 42/2015) on two questions of law, namely,

(1)  Whether, as a matter of construction, the contract of employment entitled the Commission to take into account the work performance of the claimant in deciding whether to pay him the gratuity.

(2)  Whether the Tribunal failed to apply the correct legal test in ruling that the Commission wrongly failed to pay the gratuity. 

32.By his judgment handed down on 17 March 2017, G Lam J allowed the appeal. He held that:

(1)  On question (1), the Tribunal erred in the construction of clause 13.1 of the Conditions of Service. On a proper construction, the claimant’s contractual entitlement to receive gratuity was conditional on “satisfactory completion of the agreement in the opinion of the employer”, and this involved a discretion or judgment of the Commission.  “Satisfactory completion” did not only refer to the dimension of time.  The quality of the claimant’s performance of the contract may be taken into account by the Commission in forming an opinion under clause 13.1 as to whether there had been satisfactory completion of the employment agreement.

(2)  On question (2), the Tribunal failed to apply the correct test in ruling that the Commission breached the contract of employment in deciding not to pay gratuity to the claimant.   The correct question or approach for the Presiding Officer was whether it was shown that the Commission’s conclusion that the claimant had not satisfactorily completed the contract of employment was irrational or perverse.

33.After considering the relevant provisions in the Labour Tribunal Ordinance and the Rules of the High Court and the authorities, G Lam J did not accept the parties’ submissions that he should go further and decide the claim.  Instead, he set aside the order of the Tribunal and remitted the case to the Tribunal for determination in accordance with the construction of clause 13.1 and the proper approach set out in his judgment. 

E.    Labour Tribunal’s decision in the re-trial

34.The re-trial took place before another Presiding Officer.  It was agreed between the parties that there were two core issues to be tried[6]:

(1)  Whether the claimant’s participation as a speaker at the Forum without prior notification/application to the Commission and what he said at the Forum was incompatible with the duty of loyalty and fidelity in the discharge of his duties as the Commission’s employee.

(2)  Whether the Commission’s conclusion that the claimant failed to satisfactorily complete his employment contract, thus its decision not to pay gratuity to the claimant was irrational or perverse.

35.Both the claimant and Chow testified at the re-trial.  They adopted their witness statements and were subject to cross-examination. 

36.On core issue (1), the Presiding Officer found on the evidence that what the claimant said and did at the Forum was incompatible with his duty of loyalty and fidelity in that he had breached his duty to act loyally in the discharge of his duties as the Commission’s employee as well as the Code of Conduct.

37.On core issue (2), the Presiding Officer held that the Commission’s decision not to pay gratuity to the claimant was neither irrational nor perverse.  She accepted Chow’s evidence that a variety of factors had been taken into account in forming the opinion that the claimant had failed to satisfactorily complete his employment contract and taking the decision not to pay gratuity to him.  The factors he had considered included the claimant’s failure to report/disclose his participation in the Forum in accordance with the Code of Conduct, what he said at the Forum, it was not disputed that the voice recorded in the audio recording was his voice as well as his attitude and response throughout the internal investigation.

38.The Presiding Officer also rejected the claimant’s argument, relying on Braganza v BP Shipping Ltd & Anor [2015] 1 WLR 1661, that the internal investigation failed to satisfy the public law principles of legality and rationality.  She was of the view that (a) Braganza was distinguishable on the facts in that the Commission had offered the claimant a reasonable opportunity to explain and clarify the Apple Daily report, but the claimant was uncooperative and chose not to do so; (b) in light of the claimant’s refusal to cooperate while not disputing that it was his voice that was in the audio recording, the Commission was entitled to form a view on the incident based on information available to it; and (c) the claimant’s admissions that he had expressed objection to same-sex marriage at the Forum and suggested to the participants how to answer the consultation questions supported Chow’s view that his participation and the speech he gave at the Forum breached his duty under the Code of Conduct to avoid conflict of interest, and further showed that Chow’s opinion was neither irrational nor contrary to the facts.

39.The Presiding Officer accordingly dismissed the claimant’s claim with costs.

F.    The Judge’s decision

40.The claimant appealed the dismissal of his claim to the Court of First Instance.  He advanced the following revised grounds of appeal[7]:

“(1) The Presiding Officer, in concluding that the Commission’s investigation process was lawful and reasonable in the public law sense, failed to take into account the errors and deficiencies in the process as admitted by Li at the first trial.

(2)   The Presiding Officer ought to have held that there was overwhelming evidence that the investigation failed to follow the disciplinary procedures and was in breach of natural justice, thereby rendering the decision not to pay gratuity (insofar as it relied on the investigation in support of a finding of misconduct against the claimant) irrational and/or perverse.

(3)   In considering whether Chow made his own independent decision not to pay the gratuity, the Presiding Officer failed to consider properly or at all the following principles:

(a)   The validity of a decision falls to be judged as of the date of that decision. Challenge for unreasonableness will be determined by reference to the circumstances at that time and not thereafter. The court should be cautious about accepting late reasons and treat with caution reasons put forward after the commencement of proceedings with caution.

(b)   An employer is under an obligation to treat his employee fairly in explaining to the employee the situation, which would involve making known to the employee the factors which have influenced the decision, by whom the decision was taken and the reasons for the decision taken.

(c)   The employee should be given a right to respond to the employer’s decision and also the factors which have been taken into account.

(4)   Without having regard to the above principles, the Presiding Officer, in accepting Chow’s evidence that he made an independent judgment on the claimant’s conduct and the final decision not to pay the gratuity, erred as follows:

(a)   She failed to conduct any or any proper assessment on the relevance, weight and credibility of Chow’s evidence in that (i) she did not consider that reasons provided by him in his oral testimony were not set out in his statement; (ii) whether his independent judgment was tainted by the perversity or irrationality caused by the errors and deficiencies in the investigation process; (iii) whether Chow’s understanding and interpretation of the contents of the audio recording was reliable in the absence of further enquiry with the Church forum organizer and/or Apple Daily; (iv) whether his independent decision was itself perverse or irrational as the claimant was never provided with any reasons for the decision and opportunity to respond to the same.

(b)   She gave unnecessary and/or undue weight to the alleged lack of co-operation on the part of the claimant in the investigation process.  This factor is neither here nor there, given the errors and deficiencies in the investigation as well as the lack of obligation on the part of the claimant to respond when the Commission did not refer to any provision in the Code of Conduct or any particular charge to be laid against him.  The Commission also never communicated to him that its refusal to pay the gratuity was based on his failure to co-operate in the investigation process.

(5)   The Presiding Officer erred in accepting core issue (1) as an issue to be tried because this would tantamount to her conducting her own investigation on whether the claimant’s conduct amounted to breach of duty or misconduct.  She ought to have considered whether the decision making process was lawful and rational in the public law sense, and whether the decision was made in good faith and consistently with the contractual purpose, not whether the outcome for the claimant was objectively reasonable.

(6)   The Presiding Officer failed to pay any or any sufficient heed to the essential principles laid down in the Braganza case, namely, the employer is expected to know how to approach making decisions that he is required or empowered to make under the terms of the employment contract, and that such decision making process should be subject to scrutiny which is no less intensive than that the court applies to the decision of a public authority which is charged with making a finding of fact.

(7)   Had the Presiding Officer properly and sufficiently considered the principles, she would not have committed the errors identified in the above grounds of appeal.”

41.In his decision, the Judge set out two trite principles governing the appeal. They are that (a) the focus of the appeal is whether there is any error of law in the Tribunal’s decision; and (b) where the challenge is against the Tribunal’s finding of fact, an error exists only if the finding is plainly wrong in that it is clearly inconsistent with the evidence or is based on any disregard or misunderstanding of evidence or, in other words, where no reasonable tribunal would have made on the evidence.

42.The Judge dealt with grounds (5) to (7) before considering grounds (1) to (4).  The Judge rejected ground (5) which complained that the Presiding Officer erred in accepting core issue (1) as an issue to be tried.  The Judge pointed out that core issue (1) was one of the factors that the Commission took into account in forming the opinion that the claimant did not satisfactorily complete the employment contract and deciding not to pay him gratuity.  Hence, when assessing the lawfulness and rationality of the Commission’s opinion and decision, the Presiding Officer would have to examine the underlying basis, including core issue (1), to see if it was objectively reasonable.  The two cores issues were therefore intertwined.  The Judge was further of the view that when the Presiding Officer dealt with core issue (1), it was testing the reasonableness of Chow’s view and was not, as the claimant argued, forming her own view on the issue.

43.The Judge also did not accept the complaints in grounds (6) and (7) that related to the principles in Braganza.  The Judge observed that the English Supreme Court’s decision that there should be cogent evidence to support an employer’s finding that might impact on the employee’s entitlement to a benefit under the employment contract had to be understood in the factual context of the case.  In his view, what Braganza added to G Lam J’s judgment was that the more inherently improbable a state of affairs was, the more cogent the evidence to establish it would have to be.  The Judge, however, pointed out that each case must turn on its own facts.  He saw no basis to suggest that the Presiding Officer was unaware of G Lam J’s holding that the Commission’s opinion on whether the claimant had satisfactorily completed the employment must not be perverse or irrational. 

44.The Judge next dealt with grounds (1) and (2) which in essence complained that the Presiding Officer failed to have proper regard to the errors and deficiencies of the internal investigation. The Judge highlighted an important aspect of the case, namely, the internal investigation and Li’s report and the warning notice per se did not lead to the termination of the employment contract or the withholding of the claimant’s employment benefit. It was the Commission’s subsequent exercise of its discretion under the contract, after considering a variety of factors, which included the investigation and its result, that led to the decision not to pay the gratuity.  Hence, what fell to be scrutinized by the Tribunal was the Commission’s consideration and decision. 

45.The Judge rejected the argument that G Lam J remitted the case to the Tribunal for making a finding on whether the errors and deficiencies in the investigation and Li’s report rendered the decision not to pay gratuity perverse or irrational.  The Judge held that the relevant time for deciding whether the Commission’s decision was perverse or irrational was when the Commission deliberated and made the decision, which would be after the investigation and Li’s report as well as the issue of the warning notice.  The suggested errors and deficiencies were only relevant insofar as, and to the extent, the Commission had relied on the investigation to support a finding of misconduct against the claimant when it deliberated on the gratuity matter.  In this context, the question to be asked was whether it was wrong for the Commission to take into account or place weight on the investigation and its result. 

46.In relation to the complaints about the investigation, the Judge considered that the claimant had knowledge of the investigation result latest on being given the warning notice.  He would also have known from the warning notice that the investigation result would be taken into account when determining whether there was satisfactory completion of the employment contract and that it might have repercussions on the gratuity payment.  The claimant was also reminded of his right to appeal, and he could have lodged an appeal.  He, however, did not do so. 

47.The Judge also considered that it was the Commission’s case and Chow’s evidence that before forming the opinion that the claimant had not satisfactorily completed the employment contract, they had taken into account a number of factors and also the evidence available to them, including the investigation result that had not been appealed.  The Judge noted that G Lam J took the view that this aspect of the Commission’s case and evidence should be tested in a trial before it could be concluded that the Commission’s decision not to pay gratuity was perverse or irrational.

48.The Judge then turned to grounds (3) and (4), which he observed were attacks on the Presiding Officer’s findings of credibility and fact on the evidence.  The Judge upheld the Presiding Officer’s findings, including her acceptance of Chow’s evidence and the finding that Commission’s conclusion was neither perverse nor irrational.  The Judge considered that (a) it was not wrong to allow Chow to clarify and elaborate on his witness statement and the claimant had the opportunity to cross-examine him; and (b) there was no precise and clear basis for the suggestion that Chow’s independent judgment was somehow tainted by the suggested errors and deficiencies of the investigation process. The Judge rejected the argument that the Presiding Officer should have questioned Chow’s understanding and interpretation of the content of the audio recording, pointing out that the Presiding Officer’s considerations and conclusion were supported by the evidence in the case and it could not be said that any reasonable tribunal would have understood and interpreted the content of the recording materially different from that of Chow. 

49.The Judge also rejected the argument that the Presiding Officer should have found the Commission’s failure to give reasons for the decision not to pay gratuity and to allow the claimant the opportunity to respond to the decision rendered its decision perverse and irrational.  The Judge was of the view that the claimant did have an opportunity to respond after being given the warning notice, which made clear the potential importance of the investigation result and the warning on his gratuity entitlement.  The Judge also did not accept that the Presiding Officer had placed undue weight on the claimant’s attitude and approach during the investigation, pointing out that the Presiding Officer was entitled to accept that this was a matter that the Commission could have regard to in determining whether there had been satisfactory completion of the employment contract.  The Judge also did not accept the criticism that the Commission failed to inform the claimant that failure to cooperate in the investigation would cost him the loss of the gratuity for it could not be suggested that, had he been so informed, he would have behaved differently which would have affected his entitlement to gratuity. 

50.The Judge concluded that none of the grounds of appeal succeeded in establishing that the Presiding Officer had committed an error of law, or that no reasonable tribunal would have reached the same findings and conclusion as she did on the Commission’s decision not to pay gratuity.  He accordingly dismissed the appeal with costs to the Commission.    

G.     The present application

51.By the present application, the claimant seeks leave to appeal the Judge’s dismissal of his appeal. 

52.Under section 35A of the Labour Tribunal Ordinance, the Court of Appeal may grant leave to appeal from a decision of the Court of First Instance on an appeal from the Labour Tribunal if it considers that a question of law of general public importance is involved.

53.Mr Khaw SC acting for the claimant argues that the intended appeal involves the following three questions of law (respectively “Question (1)” to “Question (3)”, and collectively “the Three Questions”) which are of general public importance:

(1)  If an employer exercises his discretion on an employee’s contractual rights or benefits as a result of a disciplinary action, should the decision be subject to scrutiny in accordance with the grounds and standards that the court normally applies in judicial review cases?

(2)  If the employer’s decision is considered irrational or perverse (on the basis that the disciplinary action involved was in breach of rules of natural justice), will the employer be allowed to cure the irregularities by exercising his own discretion on the matter? Further, should such exercise of discretion be scrutinized by examining if it has been tainted by the impropriety of the disciplinary action?

(3)  Would the employee’s decision not to appeal against the disciplinary action have any material impact on whether such action will render the employer’s decision irrational or perverse?

54.At the same time, the claimant has also put forward four grounds of appeal as follows:

“1.   The Judge failed to give sufficient consideration or at all the reasons why G Lam J remitted the matter to the Labour Tribunal. Had the Judge considered the reasons properly, he ought to have allowed the appeal on the basis that the Presiding Officer failed to deal with the questions, namely:-

(1)   Whether the Commission’s decision not to pay the gratuity was based on or partly based on the disciplinary process?

(2)   If (1) is answered in the affirmative, should the decision be rendered irrational or perverse by the deficiencies in the investigation process and the report?

(3)   If (1) is answered in the negative, whether the decision of Chow, in exercising his discretion not to pay the gratuity, was tainted or influenced by the investigation process and the report?

2.   The Judge erred in concluding that the investigation and the disciplinary process per se did not lead to the termination of the employment or the employment benefits of the claimant when (1) the Presiding Officer failed to give any ruling on whether the Commission’s decision not to pay the gratuity was part of the disciplinary process in making its decision not to pay the gratuity; and (2) the warning notice stated that the Commission would take into account the investigation result “when determining whether there has been satisfactory completion of your agreement, which may have repercussions on your gratuity.”

3.   The Judge, while referring to the deficiencies and errors of the investigation, failed to take into account that the Presiding Officer failed to address any of such questions (and the impact of the same). Instead, the Judge placed excessive and unnecessary weight on the fact that the claimant did not appeal against the warning notice without having regard to (1) that the claimant immediately disputed the contents of the Warning Notice; and (2) the investigation report was not provided to the claimant until the first trial before the Labour Tribunal.

4.   The Judge failed to consider sufficiently or at all that the Presiding Officer failed to assess and evaluate Chow’s evidence at the second trial, and he ought to have allowed the appeal on the basis of the Presiding Officer’s failure to discharge her duty in this regard.  The Presiding Officer failed, in particular, to consider (1) whether Chow’s alleged independent exercise of discretion was tainted by the errors and deficiencies of the investigation, given Chow’s own admission that when he consulted other members of the Commission and the Commission’s lawyer, he only referred to what was included in the investigation report and sought their opinions on this basis; (2) insofar as Chow’s decision was based on his own listening to the audio recording, whether his understanding and interpretation of the contents were reliable in the absence of any further enquiry with the Church or any other participants at the forum; and (3) whether his alleged independent decision (on the basis that it was not part of the disciplinary process) was perverse or irrational since the claimant had never been given any opportunity to respond to the same.  The Judge should not have provided his own analysis on these matters in place of what ought to have been done by the Presiding Officer.” 

55.As section 35A only permits a party to appeal the decision of the Court of First Instance on an appeal from the Labour Tribunal on questions of law of general public importance, in considering the present application we will focus on the Three Questions.  Leave to appeal will only be granted if we are satisfied that one or more of the Three Questions are involved in the intended appeal and that they are reasonably arguable questions of law of general public importance.

56.For the reasons set out below, we are of the view that leave to appeal should be refused.

57.Firstly, the claimant’s statement of application has not addressed the Three Questions.  There is no explanation on how each of them arises from the Judge’s decision or how each of them is involved in the intended appeal.  Neither has it elaborated on why they are questions of general public importance.  Instead, the statement of application has focused on the draft grounds of appeal, which relate solely to the merits of the findings and decisions made by the Presiding Officer and the Judge.  Ground 4, for instance, is a repetition of the grounds of appeal argued before the Judge. 

58.In respect of the Three Questions, on Question (1), no challenge was made in the re-trial to the principle that the public law standard applies to the decision made by an employer in the exercise of his discretion (including assessment of evidence) which may affect an employee’s contractual rights or benefits.  There was also no dispute on the principles laid down in Braganza and G Lam J’s holding that the decision of the Commission not to pay gratuity must not be perverse or irrational.  In these circumstances, there is no need for the Court of Appeal to adjudicate on this area of the law.  Question (1) is unnecessary and does not arise for determination. 

59.On Question (2), there was no finding in the re-trial that the investigation was in breach of natural justice.  There is also no evidence or finding to support the contention that the Commission was seeking to cure the irregularities when it exercised its discretion and decided not to pay the gratuity.  Moreover, in the absence of a finding that the investigation had breached the rules of natural justice, there is no warrant to view the Commission’s exercise of its discretion as an act to cure irregularities in the disciplinary action.  There is also no basis for any suggestion that the Commission’s exercise of discretion was tainted with impropriety in the disciplinary action.  In short, Question (2) does not arise on the facts and findings of this case.

60.As for Question (3), this is not a question of law at all.  It is a question directed at the facts of this case.  Further, whether an employee’s failure to challenge or appeal a disciplinary action will materially impact on the lawfulness and rationality of the employer’s decision must depend on the facts of each case.  It is therefore a fact-sensitive question.  Moreover, the question does not rise in the intended appeal.  While both the Presiding Officer and the Judge had referred to the fact that the claimant did not appeal the issue of the warning notice of him, it is no part of their decisions that this fact impacted on the rationality of the Commission’s decision not to pay the gratuity.   

61.The Three Questions are therefore not questions of law of general public importance and/or do not arise from the decisions of the Tribunal or the Judge.  The statutory requirement for granting leave to appeal under section 35A is therefore not met.

62.Further, the arguments raised in the statement of application are, in any event, not reasonably arguable.  On the complaint that the Presiding Officer failed to resolve three issues that G Lam J directed should be resolved in the re-trial (see the first draft grounds of appeal), this was not raised before the Presiding Officer.  Instead, it was agreed between the claimant and the Commission that the two core issues were to be resolved. This point was also not argued before the Judge.  Further, G Lam J remitted the case to the Tribunal generally for re-trial of the claim in accordance with the legal principles set out in his judgment.  He did not remit the case for determination of specific issues. 

63.With regard to the complaint that the Presiding Officer failed to consider the deficiencies of the internal investigation and their effect on the Commission’s decision, as pointed out by Mr Lui for the Commission, the Presiding Officer had considered the deficiencies complained of by the claimant but was of the view that the Commission had complied with the requirements of fairness and reasonableness[8]. The Judge agreed with her finding[9].

64.As to the arguments associated with Braganza, they are misplaced given that the Presiding Officer had held, with which the Judge agreed, that the case was distinguishable.

H.     Disposition and costs

65.For the reasons set out above, we refuse to give leave to the claimant to appeal against the Judge’s decision.  The summons is accordingly dismissed.

66.Applying the normal rule of costs follow event, we also order the claimant to pay the Commission the costs of this application to be assessed summarily.

67.We have considered the Commission’s statement of costs for summary assessment.  In light of the fact that counsel was involved in the preparation of the statement of opposition, we are of the view that the solicitors’ costs on the preparation of this document (Item D1(1)) is excessive on party-and-party basis and should be reduced.  In addition, the costs for the preparation of the statement of costs (Item D1(2)) is to be disallowed: see Practice Direction 14.3 at [13].  Taking a broad brush approach, we summarily assess the Commission’s costs at $85,000. 

68.As this application is without merit, pursuant to the power under Order 59, rule 2A(8), we further order that no party may under rule 2A(7) request the determination to be reconsidered at an oral hearing inter partes.

Mr Richard Khaw SC instructed by Chiu, Szeto and Cheng for the claimant.

Mr Mike Lui instructed by Lo and Lo for the defendant.