Read the full judgment text of CACV 000055/2000 on BabelCite. This Court of Appeal judgment was delivered on 18 July 2000 before Godfrey VP, Rogers and Ribeiro JJA.
Employment law – domestic helper – constructive dismissal – breach of implied term of mutual trust and confidence – compromise agreement – unconscionable bargain – measure of damages – loss of a chance – costs of litigant in person – appeal. The plaintiff, a Filipino domestic helper, was subjected by her employer and his wife to an oppressive work regime, denial of rest days and physical and psychological abuse, culminating in constructive dismissal on 8 September 1998. After the dismissal, at a conciliation meeting at the Labour Department conducted by a Labour Relations Officer, the plaintiff signed a compromise agreement accepting HK$975 in purported full and final settlement of her claims. The officer had advised the parties on the basis of undisputed facts only, without considering the disputed allegations of constructive dismissal. The Court of Appeal held that the compromise agreement was properly set aside by the trial judge as an unconscionable bargain, applying the principles in Hart v O'Connor, because the plaintiff, a person of social and economic disadvantage with marked inequality of bargaining power, was induced by her employer's false assertions and the officer's faulty advice to sign an improvident agreement limiting her compensation to a paltry sum, when in fact she had been constructively dismissed. The Court further held, following Malik v Bank of Credit and Commerce International SA, that the defendant's conduct through his wife constituted both a constructive dismissal and a breach of the implied obligation of mutual trust and confidence, but that the proper measure of damages was loss of a chance of obtaining alternative employment (with immigration permission) rather than loss of the full remaining contractual earnings, distinguishing Addis v Gramophone Co Ltd as a wrongful dismissal simpliciter case. The Court assessed the loss of a chance at 50% of the contractual monthly salary of HK$3,860 for a 9-month period (8 September 1998 to 8 June 1999), yielding HK$17,370, in place of the trial judge's award of HK$46,577. On the plaintiff's cross-appeal, the Court of Appeal set aside the trial judge's award of fixed costs of HK$896 and ordered costs to be taxed if not agreed, holding that the trial judge had inadvertently pre-empted the proper exercise of discretion under O 62 r 28A of the Rules of the High Court. The plaintiff was awarded 75% of her costs of the appeal.
Legal issues: Setting aside compromise agreement as unconscionable bargain · Procedural fairness in deciding to set aside the compromise agreement · Measure of damages for breach of implied trust and confidence term in constructive dismissal · Costs for litigant in person under O 62 r 28A
Outcome: Defendant's appeal partially allowed; plaintiff's cross-appeal on costs allowed. Damages for constructive dismissal reduced from HK$46,577 to HK$17,370, and fixed costs order set aside in favour of taxed costs.
Cited by 2 cases