Ho Wai Keung v. Billion Rich Investments Ltd

CACV 15/2022, [2023] HKCA 929

On Appeal From [2021] HKDC 1477

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 15 OF 2022

(ON APPEAL FROM DCEC NO 2007 OF 2017)

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REASONS FOR JUDGMENT

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Hon Chow JA (giving the Reasons for Judgment of the Court):

INTRODUCTION

1.This is the Applicant’s appeal against the judgment of Deputy District Judge Lee Mo Kit, Rebecca dated 10 December 2021 (“the Judgment”) dismissing the Applicant’s claim against the Respondent for compensation under the Employees’ Compensation Ordinance, Cap 282 (“the Ordinance”). The principal issue which arises for determination in this appeal is whether the Judge was correct to find that the Applicant was not an employee of the Respondent at the time of the accident on 13 December 2015.

2.At the conclusion of the hearing of the appeal, we dismissed the appeal with costs to the Respondent, with reasons to be given later. This we now do.

BRIEF BACKGROUND FACTS

3.The Applicant was born in Mainland China in 1957, and came to Hong Kong in 1978. Since about 2011, the Applicant started to be engaged in the business of collection, cutting and disposal of waste tyres (“the Disposal Business”). On 15 June 2013, he registered a sole proprietorship business under the name of “藍星環保物料再生公司” (Blue Planet Environmental Renewal Company) (“Blue Planet”), and held a licence in the name of Blue Planet which permitted him to carry on the Disposal Business. In the business registration certificate of Blue Planet, the nature of its business was described as “回收輪呔, 木卡板等廢料再造”.

4.Mr Lo Yat Cheung (“Mr Lo”) was formerly the sole director and shareholder of the Respondent (億豐投資有限公司, Billion Rich Investments Limited), a company incorporated in Hong Kong in 2012. Mr Lo came to know the Applicant in about April 2014 when he engaged the Applicant to carry out some unrelated works at a warehouse operated by Mr Lo in the New Territories.

5.On or about 14 October 2014, the Applicant in the name of Blue Planet submitted a tender to The Kowloon Motor Bus Co (1933) Ltd (“KMB”) to undertake the collection of waste tyres from the fleet of buses operated by KMB. KMB later accepted Blue Planet’s tender and awarded a contract to Blue Planet.

6.On 1 November 2014, Mr Lo as Party A (甲方) and the Applicant as Party B (乙方) entered into a written agreement titled “合作營商協議書” (“Business Co-operation Agreement”). The Business Co-operation Agreement stated, inter alia, as follows:

“合作營商協議書 (2014年11月1日訂立)

…

今甲乙雙方同意合作，成立〈億豐投資有限公司〉…

1) 投資金額：總數港幣壹百萬，(HK$1,000,000.00)

2) 資金分配：甲方佔70% (HK$700,000,00)，需即時注資入該公司作營運. 乙方佔30% (HK$300,000.00)，但可暫緩注資；日後該公司年終結算所得純利，按比例分配，乙方應得之數，需歸還公司作營運資金，為期叁年. (貳年期內，乙方如想將股權增至49%，則需以HK490,000.00現金即時注資，以示公允.)

(備註：投資金額如超出港幣壹百萬, 則甲乙雙方需按比例以現金注資)

3) 法律責任：若該公司經營不善，出現虧損，乙方需於壹(1)年內清還所欠投資金額之尾數.

4) 薪金：乙方因需負責該公司之營業運作，故每月可支取薪津HK$30,000.00.

5) ……

6) 甲，乙雙方同意，以兩年時間為限，若該公司運作不如理想，則雙方可按比例取回投資金額.”

7.The Applicant and Mr Lo’s intention was to develop a recycling business involving the grinding of waste tyres into powder[1] (“the Recycling Business”) under the Business Co-operation Agreement at a workshop of the Respondent in Yuen Long (“the Site”). In around December 2014, machines for the proposed Recycling Business started to arrive at the Site. The Respondent also purchased a truck with registration mark TB563 (“the Truck”) intended for use in the Recycling Business.

8.It was not in dispute that even after the making of the Business Co-operation Agreement, insofar as third parties were concerned, the Applicant continued to carry on business in the name of Blue Planet, and he was regarded as being the boss of Blue Planet[2].

9.On or about 23 December 2014, Mr Lo was added as a partner of Blue Planet. Apparently, this was done to reflect and protect Mr Lo’s 70% interest in the proposed Recycling Business under the Business Co-operation Agreement. On the other hand, no shares in the Respondent were transferred or allotted to the Applicant because he told Mr Lo that he had once been bankrupted and it might affect the ability of the Respondent to borrow moneys in future if he were to become a shareholder of the Respondent[3].

10.During the period from October 2014 to September 2015, Mr Lo injected the total sum of HK$3,519,083 into the proposed Recycling Business.

11.The Recycling Business failed to take off. By July 2015, the factory for the Recycling Business could still not commence operation. In September 2015, discussion took place between Mr Lo and the Applicant to terminate the Business Co-operation Agreement[4].

12.On 1 October 2015, the Applicant and the Respondent entered into a written agreement titled “借用場地, 機器及工具證明書” (“the Borrowing Confirmation”). The Borrowing Confirmation was signed by the Applicant and Mr Lo next to a company chop of the Respondent. It stated, inter alia, as follows:

“借用場地，機器及工具証明書

本人何偉強 …… 是以自顧及個人名義經營回收砌割廢輪胎生意，現得億豐投資有限公司同意，及允許借出該公司所擁有的資產；

A. 場內砌割廢輪胎所使用的機器共拾枱，包括 ……

B. 場地：位於元朗，八鄉，江夏圍，DD 106，LOT 1342B，及場內所有工具

C. 車牌TB563運輸車輛壹輛

對於借用的條款，本人明白並願意承擔責任：

1. 繳付場地一切水費，電費及雜項費用.

2. 負責保養，維修所借用的機器，車輛；並支付該等費用.

3. 有關回收廢輪客戶之月結單，需交由[億豐]代為辨理及依單收取款項.

4. 每月需支付[億豐]行政費HK$50,000.00，如有代支款項，利息等，則一律在代收客戶之款項內扣除，不足之數由何偉強支付.

5. 終止借用，需於一個月前通知[億豐].

6. 終止借用通知發出後，借用人須在一個月內交還所借用的機器，車輛，工具等資產.

……

借用生效日期：2015年拾月壹日”

13.On 1 October 2015, the Applicant also entered into an agreement with Mr Lo concerning his repayment of the capital investment that Mr Lo had advanced on the Applicant’s behalf into the Recycling Business under the Business Co-operation Agreement. This agreement is referred to in the Judgment as 還款確認書 (“the Repayment Confirmation”). There are two slightly different versions of the Repayment Confirmation, but their contents are materially the same. One was signed by the Applicant “強” after the words “已閱”, and the other was signed by Mr Lo.

14.In the version of the Repayment Confirmation signed by the Applicant, the following was stated:

“羅日祥，何偉強，以億豐投資有限公司，藍星環保物料再生公司合作經營切割輪胎所有注資金額詳情
若以注資100萬計：
羅日祥佔70% (70萬)，何偉強佔30% (30萬)
以下由羅日祥注資詳情:-
…
合共總注資 -- HK$3,519,083.00
總注資金額分配如後：	羅日祥佔70% (即HK$2,463,358.00)
	何偉強佔30% (即HK$1,055,724.00)
根據合作協議書中，何偉強佔30% (即HK$1,055,724.00)，此款是由羅日祥暫時借與，還款期由01-10-2014年起，3年內還清，而何每月需支付借款利息HK$10,557.00.
本人何偉強 …，確認此金額，並承諾每月按時還息，及盡早清還所借款項.”

15.On 13 December 2015, the Applicant worked at KMB’s premises in Kowloon Bay. At about 3:00 pm on that date, while he was descending from a ladder installed on the Truck, he slipped and fell down to the ground resulting in fracture injuries to his left hip.

16.The Applicant claimed that he was an employee of the Respondent at the time of the accident, and sustained personal injuries by accident arising out of and in the course of the employment. On 4 August 2017, he commenced the action below for compensation under ss 9, 9(1A), 10 and 10A the Ordinance. The Respondent denied that the Applicant was its employee, and contended that he was carrying on his own business at the time of the accident.

THE JUDGMENT

17.The action was tried by the Judge on various dates in July and September 2021. At the trial, both the Applicant and Mr Lo gave oral evidence. In addition, one Ms Leung gave evidence on behalf of the Respondent.

18.By the Judgment, the Judge dismissed the Applicant’s claim, holding that he was not an employee of the Respondent at the time of the accident. The Judge summarized her factual findings at §110 of the Judgment:

“(1) 申請人與羅先生是以答辯人名義合作經營舊輪胎生意。

(2) 羅先生注資3百萬多元，而申請人沒有如合作協議書所示注資，所以轉讓了藍星51%股權予羅先生。

(3) 申請人與羅先生均視大家是合作營商的關係，而答辯人是大家合作營商的工具。

(4) 申請人在協議書下是須要負責答辯人的營業運作，故可每月支取薪津30,000元。

(5) 就算申請人同時是答辯人的僱員，這關係在2015年10月1日後已經結束 (見借用証明書及還款確認書)。

(6) 在意外時 (即2015年12月13日)，申請人是以藍星名義進行舊輪胎回收工作。

(7) 答辯人對此工作沒有控制權，答辯人在2015年10月1日之後與申請人或藍星沒有僱傭或合營關係。

(8) 申請人在意外時只是借用答辯人名下的貨車。”

19.The Judge concluded at §§111-115 of the Judgment as follows:

“[111] 綜合以上，就算申請人作為答辯人的合營者而同時亦是答辯人的僱員，在合作協議書下，雙方的證供都清楚表示，答辯人的‘合營生意’，是由羅先生投資的新機器去進行的磨粉工作。藍星一向的舊輪胎切割生意，是申請人已有的生意，而收益要轉入答辯人的戶口，是因為申請人沒有根據協議注資。

[112] 本席參考了羅大律師的陳詞及呈上的案例，以及Poon Chau Nam與 鄧秋月 的十一項因素，本案帶出的整體印象，申請人在意外當日並非答辯人的僱員。

[113] 申請人的僱員身份 (若能證明的話) ，在2015年10月1日之後已經改變。本席並不認同申請人所說，他是被迫簽下借用証明書及還款確認書。正如羅大律師所言，申請人是希望以藍星名義繼續在工場進行舊輪胎回收生意。

[114] 更重要的是，在意外發生時，申請人是在九巴車廠收集舊輪胎，而雙方都沒有爭議，九巴是將工作判給藍星，而非答辯人。申請人是藍星的股東，在進行這工作時，他並不是以答辯人的合營者或僱員身份去行事。就算之後工作收益轉入答辯人的銀行戶口，這並不能改變九巴是把工作判給藍星的事實。

[115] 本席裁定，在相對可能性下，申請人在2015年12月13日發生意外時並非答辯人的僱員，所以毋須為申請人在當日工作時受傷負上僱員補償條例下的責任。”

20.In view of the Judge’s conclusion that the Applicant was not an employee of the Respondent at the time of the accident, it became unnecessary for the Judge to deal with the issue of quantum of compensation. Nevertheless, for the sake of completeness, the Judge made an assessment of the compensation in the sum of HK$470,300 plus interest thereon.

THE APPEAL

21.In the Applicant’s Amended Notice of Appeal dated 23 May 2022, he raises 7 grounds of appeal against the Judge’s finding that he was not an employee of the Respondent at the time of the accident. These grounds have been amplified and refined in Mr Billy Liu’s Skeleton Submissions dated 29 June 2023. For the purpose of this Judgment, we shall focus on Mr Liu’s submissions, both oral and written, advanced in support of the Applicant’s appeal.

DISCUSSION

(i)  Errors of law

22.Mr Liu argues that the Judge made 2 errors of law leading to her finding that the Applicant was not an employee of the Respondent at the time of the accident, namely:

(1)  the Judge erroneously focused on the element of “lack of control”, in the specific circumstances where she had found the Applicant to be a co-owner of the Respondent; and

(2)  the Judge placed excessive weight on the parties’ designation of the nature of their relation[5].

As will be seen below, neither argument of Mr Liu has any merit.

23.The proper approach for determining whether an employer-employee relationship exists for the purpose of the Ordinance is well settled, and has been authoritatively laid down in the judgment of the Court of Final Appeal in Poon Chau Nam v Yim Siu Cheung (2007) 10 HKCFAR 156. At §§11-17 of the judgment, Ribeiro PJ (with whom the other members of the Court of Final Appeal agreed) stated as follows:

“[11] In the earlier case-law, whether the master controlled the manner of doing the work was regarded as the single test for identifying a master and servant relationship, particularly in the context of vicarious liability, there being an evident logic in founding the master’s vicarious liability on his control over the servant who inflicted the damage. However, it became clear that the control test as originally conceived was too narrow…

[12] The test was therefore widened to embrace indirect forms of control. Thus, in Short v J and W Henderson Ltd, Lord Thankerton applied ‘the four indicia’ of a contract of service suggested by Lord Justice-Clerk Alness in Park v Wilsons and Clyde Coal Company Ltd, consisting of the following:

‘(a) The Master’s power of selection of his servant; (b) the payment of wages or other remuneration; (c) the Master’s right to control the method of doing the work; and (d) the Master’s right of suspension or dismissal.’

[13] But control as a test has no obvious relevance to determining for instance, whether a person ought to be considered an employee so as to qualify for minimum wages, or for employment protections against redundancy or unfair dismissal, or whether he ought to be insured by the employer under a national health scheme, or, in ECO cases, whether his employer ought compulsorily to insure him against accidental injury at work. While control (broadly conceived) continues to be regarded as one of the indicia of employment, the courts have increasingly turned to the economic or commercial aspects of the relationship as more suitable guides to the allocation of such statutory rights and duties.

[14] Thus, in the Privy Council in 1947, having pointed to the inadequacy of control as a single test, Lord Wright stated:

‘In the more complex conditions of modern industry, more complicated tests have often to be applied. It has been suggested that a fourfold test would in some cases be more appropriate, a complex involving (1) control; (2) ownership of the tools; (3) chance of profit; (4) risk of loss.’

…

[17] The other influential first instance decision is that of Cooke J in Market Investigations Ltd v Minister of Social Security. It earned the Privy Council’s accolade in Lee Ting Sang v Chung Chi-Keung, where Lord Griffiths stated that their Lordships ‘agree with the Court of Appeal when they said that the matter had never been better put than by Cooke J’ in that case. The passage approved of runs as follows:

‘... the fundamental test to be applied is this: ‘Is the person who has engaged himself to perform these services performing them as a person in business on his own account?’ If the answer to that question is ‘yes,’ then the contract is a contract for services. If the answer is ‘no,’ then the contract is a contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of the considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors which may be of importance are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task.’”

24.At §18 of the judgment, Ribeiro PJ concluded thus:

“The modern approach to the question whether one person is another’s employee is therefore to examine all the features of their relationship against the background of the indicia developed in the abovementioned case-law with a view to deciding whether, as a matter of overall impression, the relationship is one of employment, bearing in mind the purpose for which the question is asked. It involves a nuanced and not a mechanical approach …”

25.In short, the Court should adopt an overall evaluative-impressionistic approach in deciding whether an employment relationship exists when determining claims for compensation under the Ordinance.

26.As observed by the Judge at §77 of the Judgment, the courts in Hong Kong have, over the years, also developed a list of 11 employment indicia to assist in determining whether an employer/employee relation exists in any given case. The 11 indicia are set out at §77 of the Judgment (quoting from the judgment of Deputy District Judge Clement Lee, as he then was, in 鄧秋悅 訴 傅劍波經營廚飾家及另一人 [2011] 1 HKLRD 509, which in turn referred to the judgment of Jerome Chan J in 謝林及其他二十位 訴 陳德偉, HCLA 150/1995):

“(1) 被指稱為僱主者，是否對指稱為僱員者的工作，有僱主應有的控制權？

(2) 被指稱為僱員者，是否自備工作所需工具？

(3) 被指稱為僱員者，是否自聘工作所需幫工？

(4) 被指稱為僱員者，是否須負上財政的風險，及其性質與程度？

(5) 被指稱為僱員者，是否可從他優秀的管理中，獲得利潤？

(6) 被指稱為僱員者，是否須負上投資及管理的責任，及其性質與程度？

(7) 被指稱為僱員者，可否正確地被識別為指稱為僱主者的商業組織一份子？

(8) 被指稱為僱主者，對被指稱為僱員者是否須負上保險及稅務責任？

(9) 被指稱為僱員者，有否在有關方面營商？

(10) 雙方對這關係的個人看法？

(11) 這行業或專業的傳統結構及慣例，會否有助理解？”

27.There are three observations that we wish to make in respect of these 11 indicia of employment. First, the weight (if any) which should be given to any particular indicium depends on the circumstances of the case. Second, while the 11 indicia are helpful in assisting the court to find the existence or otherwise of an employment relationship, they should not be looked at or applied mechanically. As stated by Ribeiro PJ in Poon Chau Nam at §18, the exercise calls for a nuanced instead of a mechanical approach. Third, although the 11 indicia appear to be pretty comprehensive, they should not necessarily be regarded as being exhaustive of all relevant considerations for determining the existence an employment relationship.

28.In respect of the 1^st alleged error of law, Mr Liu makes 4 principal points:

(1)  the Judge failed to consider, but simply assumed, the wholesale applicability of the control test as expounded in Poon Chau Nam without reference to the Neufeld[6] line of authorities;

(2)  in assuming the applicability and significance of the element of control, the Judge erroneously accepted the Respondent’s submissions and dismissed the existence of an employer/employee relationship because the Respondent had no control over the Applicant;

(3)  whilst the Judge correctly found that the Applicant had to carry out operational/managerial work and it was possible for him to receive remuneration from the Respondent, the Judge did not accord sufficient weight to this factor “which points towards an employment” between the Applicant and the Respondent; and

(4)  even if any weight is to be attached to the element of control, it is the “right to control” that matters, and the Judge erred in focusing on whether the Applicant’s work was subject to the actual supervision of the Respondent at the material time[7].

29.The 1^st and 2^nd points can be considered together. Mr Liu’s argument that the Judge erroneously focused on the element of control, or failed to consider but simply assumed the wholesale applicability of the control test, has no foundation. It is clear from the Judgment that the Judge carefully considered and analysed the evidence of the witnesses (including the Applicant and Mr Lo) as well as the documentary evidence before she made the factual findings at §§110-115 of the Judgment. While the Judge did consider the element of control, she did not regard it as being determinative or conclusive. The element of control, which undoubtedly was a relevant consideration for determining the existence of an employment relationship, was merely one of the factors that the Judge took into account in making her finding that the Applicant was not an employee of the Respondent.

30.In respect of the submission that the Judge failed to have regard to the Neufeld line of authorities, which Mr Liu says establishes the proposition that an “owner” in the economic sense of a business undertaking carried on through a corporation can also be an employee of the corporation, the Judge was fully aware of the Applicant’s case that he was both a co-owner of the business (合營者) and also an employee of the Respondent[8]. The Judge did not, however, find against the Applicant on the issue of employment merely because he was, as admitted by him, a co-owner of the business. The Judge took that evidence into account in reaching her conclusion that the Applicant was not an employee of the Respondent[9]. The Judge’s approach is not erroneous. The fact that the Judge did not refer to the Neufeld line of authorities is neither here nor there.

31.Mr Liu’s argument that the Judge dismissed the existence of an employer/employee relationship between the Applicant and the Respondent because (or simply because) the Respondent had no control over the Applicant has likewise no foundation. As earlier mentioned, the element of control was merely one of the factors taken into account by the Judge to find that the Applicant was not an employee of the Respondent.

32.As regards Mr Liu’s 3^rd point that the Judge failed to accord sufficient weight to the fact that the Applicant received “remuneration” from the Respondent, that was a matter for the Judge. She did not accept the evidence of Mr Lo and Ms Leung that the payment agreed to be made to the Applicant under the Co-operation Agreement was for reimbursement of sundry or miscellaneous expenses (雜費), and held that it should properly be regarded as remuneration (薪津)[10]. Nevertheless, she considered the fact that the Applicant was paid remuneration by the Respondent did not necessarily mean that he was an employee of the Respondent[11]. She regarded that matter as being a relevant consideration[12], but ultimately concluded, taking into account all relevant matters and adopting an overall impressionistic approach, that the Applicant was not an employee of the Respondent at the time of the accident[13].

33.As stated by Ribeiro PJ in Poon Chau Nam at §22:

“It is ‘firmly established that the question of whether or not the work was performed in the capacity of an employee or as an independent contractor is to be regarded by an appellate court as a question of fact to be determined by the trial court.’ Accordingly, so far as the trial judge’s classification of the contract is concerned, an appellate court can only intervene on Edwards v Bairstow grounds. In other words, a finding that an employer-employee relationship does or does not exist can only be interfered with on appeal if it can be shown that the tribunal misdirected itself in law or came to a decision which no tribunal, properly directing itself on the relevant facts, could reasonably have reached”.

34.We do not consider the Judge’s approach to be erroneous, or there is any proper or sufficient basis for the Court of Appeal to hold that she failed to accord sufficient weight to the factor that the Applicant received “remuneration” from the Respondent.

35.In any event, the Judge held that, even if the Applicant ought to be regarded as an employee of the Respondent under the Business Co-operation Agreement, such relationship came to an end with effect from 1 October 2015 upon the parties’ entering into the Borrowing Confirmation. As from that date, the Applicant was merely a “borrower” of the Respondent’s site, tools/machines and the Truck, and was no longer entitled to receive any remuneration from the Respondent. On the contrary, the Applicant was required to pay an “administrative fee” (行政費) of HK$50,000 per month to the Respondent for the use of the site, tools/machines and the Truck. We consider the Judge was plainly correct to find that even if the Applicant was an employee of the Respondent prior to 1 October 2015, such status changed after that date and he was not an employee of the Respondent on the date of the accident (13 December 2015)[14].

36.Lastly, in respect of Mr Liu’s 4^th point that it is the right to control, rather than the actual supervision of the Respondent, that matters for determining the true relation between the Applicant and the Respondent, the difficulty with this argument is that not only did the Judge accept the submission of the Respondent’s counsel that the Applicant’s work was not subject to the actual supervision or control of the Respondent (“申請人於合營期間，繼續以其本人一直經營的藍星公司營運，獨自全權負責工場的營運和工作，工作上不受任何人/答辯人的任何控制”)[15], the Judge also made a positive finding that the Respondent had no right to control the Applicant’s work, at any rate after 1 October 2015 (“答辯人對此工作沒有控制權，答辯人在2015年10月1日之後與申請人或藍星沒有僱傭或合營關係”)[16].

37.In respect of the 2^nd alleged error of law, Mr Liu also make 4 principal points. First, he argues that the Judge, in narrowly focusing on the Business Co-operation Agreement, the Borrowing Confirmation and the Repayment Confirmation, wrongly used the parties’ written documents as the starting point for the classification of their relation[17]. This criticism is unjustified. The said documents shed light on the true nature of the relation between the Applicant and the Respondent, and were properly taken into account by the Judge when considering the issue of whether the Applicant was an employee of the Respondent.

38.Mr Liu also argues that the Judge’s focus on the aforesaid documents is inconsistent with the approach in Ready Mix Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497, which held that the parties’ preference is irrelevant to the classification of the parties’ true relationship. In our view, Mr Liu’s reliance on MacKenna J’s judgment in Ready Mix at 513A-B and 515A-B is based on a misreading or misunderstanding of the relevant passages relied upon by him. MacKenna J stated that “whether the relation between the parties to the contract is that of master and servant or otherwise is a conclusion of law dependent upon the rights conferred and the duties imposed by the contract. If these are such that the relation is that of master and servant, it is irrelevant that the parties have declared it to be something else” (512G-513B), or “would have preferred a different conclusion” (515B). Plainly the parties’ contract, which sets out their respective rights and duties, is relevant for the purpose of determining the true nature of the relation between them. If, upon a proper consideration of the provisions of the contract, the true nature of the relation between them is that of master and servant (or, in more modern language, employer and employee), it would not matter that the parties use a different label or designation to describe their relation or choose to call it something else. Properly understood, the judgment of MacKenna J’s in Ready Mix does not support any proposition that the parties’ contract is not relevant for the purpose of determining their true relationship, or assist the Applicant’s case.

39.Second, Mr Liu argues that the Judge’s heavy emphasis on the written documents excluded the possibility of any proper consideration of the Applicant’s complaint that he was forced to sign the Borrowing Confirmation and the Repayment Confirmation. According to Mr Liu, the Judge ought to have addressed the evidence on the background and purpose of the Borrowing Confirmation and the Repayment Confirmation and held that they were “of no effect” and “must be disregarded”[18]. We are unable to accept this argument. The nature and effect of the written documents and the Applicant’s complaint that he was forced to sign those documents are two separate and distinct issues. The Applicant’s case that he was misled into signing, or forced to sign, the two documents was based on his bare assertion. The Judge considered, but did not accept the Applicant’s evidence on this issue[19]. The Judge also found that the Applicant was not an honest witness. The Judge was entitled not to accept the Applicant’s evidence as to how he came to sign the Borrowing Confirmation and Repayment Confirmation. In view of this finding of fact, there would be no proper basis for Mr Liu’s contention that they are “of no effect” and “must be disregarded”.

40.Third, Mr Liu argues that the Judge’s failure to address the evidence on the background and purpose of the Borrowing Confirmation and Repayment Confirmation led her to conclude that there had been a change of employment status “upon the entrance” of the Borrowing Confirmation and Repayment Confirmation. This finding, says Mr Liu, is fundamental and inextricably linked to the Judge’s conclusion that the Applicant was self-employed and carrying on his own Blue Planet business at the time of the accident[20]. We do not accept the contention that the Judge failed to address the evidence on the background and purpose of the Borrowing Confirmation and Repayment Confirmation. Mr Lo gave evidence concerning the background and purpose of the two documents[21], and the Judge was entitled to accept Mr Lo’s evidence on this issue. On the other hand, the Applicant’s evidence that he was misled into signing or forced to sign the two documents were considered but rejected by the Judge.

41.Fourth, Mr Liu argues that the Judge’s erroneous focus on the parties’ subjective views is brought to the fore in her acceptance of the Applicant’s evidence in cross-examination that he thought himself to be the boss of the Respondent, and her acceptance that such evidence was consistent with the Applicant being a co-owner of the Respondent[22]. Under cross-examination, the Applicant said that he considered himself to be the boss during the period of his business co-operation with Mr Lo (在盤問下, 他同意在合營期間, 他一直認為自己是老細)[23]. The Applicant’s view as to his own status was a relevant[24], though by no means determinative or conclusive, factor for determining the true relation between the Applicant and the Respondent. The Judge did not rely on that factor alone, but took it into account as one of the factors, in making the finding that the Applicant was not an employee of the Respondent[25]. We do not consider the Judge erred in her approach to this aspect of the Applicant’s evidence.

(ii)  Proper analysis of the relationship between Applicant and Respondent

42.In Section E of Mr Liu’s Skeleton Submissions, he argues that in light of the abovementioned errors of law on the part of the Judge, it is open to this Court to undertake for itself the classification of the parties’ relation at the time of the accident[26]. Mr Liu further contends that, upon proper analysis, the Court should find that the Applicant was an employee of the Respondent at the time of the accident.

43.Since we have rejected Mr Liu’s submissions that the Judge made either error of law complained of by him, strictly speaking, it is not necessary to further consider his submissions under this section. Nevertheless, for the sake of completeness, we shall deal with them briefly.

44.Mr Liu argues that, upon proper analysis, the Court should find that the Applicant was an employee of the Respondent at the time of the accident, because:

(1)  In the absence of a written employment contract, the court should “inquire into how the parties have conducted themselves”. In this regard, the evidence as accepted by the Judge is that the Applicant was responsible for the Respondent’s operations.

(2)  In considering whether this amounted to an employment contract, the Applicant performed his duties as a supervisor of the Respondent and had received a monthly remuneration of HK$30,000 for his work. This “points towards employment”.

(3)  The extent of control and/or lack of practical control is irrelevant. In any event, the Applicant has given evidence that he was directed by Mr Lo to work using the tools and the vehicle provided by the Respondent, regardless of whether the Applicant actually followed the directions. Further, the service fees received had to be paid to the Respondent.

(4)  There had been no change of employment following the execution of the Borrowing Confirmation and the Repayment Confirmation. There were two different versions of the Repayment Confirmation, and the Borrowing Confirmation and the Repayment Confirmation were signed unwillingly in situations where the Respondent was facing a potential labour claim. Little significance should be given to the parties’ own attempt to alter their relationship.

(5)  Finally, the Applicant remained to be an employee of the Respondent at the time of the accident. Although the Applicant was working for KMB which had a contractual relationship with Blue Planet, the Applicant explained in cross-examination that this was solely because KMB would only recognize Blue Planet as the counterparty to the tender. The Applicant’s evidence is that Blue Planet itself carried on an old tyre business, and it remained the Respondent which would receive the service fees arising from KMB’s tender[27].

45.Before we deal with the detailed points raised by Mr Liu, there are, we consider, 2 insurmountable difficulties standing in the way of the Applicant’s case that he met an accident arising out of and in the course of his employment by the Respondent. First, the Judge found that all along, both before and after the making of the Business Co-operation Agreement, Blue Planet was carrying on its original business, and there was no evidence to show that the Respondent carried on the business of Blue Planet under the Business Co-operation Agreement (“沒有證據顯示答辯人在合作協議書下經營了藍星原有的生意，而且藍星亦一直在合營前後經營本身的舊輪胎生意”)[28], Further, the Judge found as a fact that at the time of the accident, the Applicant was engaged in a job that KMB had awarded to Blue Planet and he was not performing any task in his capacity as a co-owner or employee of the Respondent (“更重要的是，在意外發生時，申請人是在九巴車廠收集舊輪胎，而雙方都沒有爭議，九巴是將工作判給藍星，而非答辯人。申請人是藍星的股東，在進行這工作時，他並不是以答辯人的合營者或僱員身份去行事”) [29]. As fairly accepted by Mr Liu at the hearing, there is no appeal against this finding of fact by the Judge.

46.Second, whatever might be the true status of the Applicant under the Business Co-operation Agreement, it is clear from the Borrowing Confirmation that the relationship between the Applicant and Respondent under that agreement came to an end as from 1 October 2015. As from that date, the Applicant carried on business on his own account, borrowing from the Respondent its site, tools/machines and the Truck for the purpose of his own business. It is plain that the Applicant was not carrying out any work as the Respondent’s employee at KMB’s premises at the time of the accident.

47.We shall now briefly comment on Mr Liu’s detailed points referred to in §44 above:

(1)  In respect of §44(1) and (2), the fact that the Applicant was responsible for, or supervised, the Respondent’s operations was equally consistent with him being a “co-owner” (合營者) of the Respondent’s business or as an employee of the Respondent. Insofar as the issue of remuneration is concerned, we have already dealt with it at §§32-35 above.

(2)  In respect of §44(3), we refer to the discussion at §36 above. The fact that under the Borrowing Confirmation, the Applicant agreed that Blue Planet’s service fees were to be collected by the Respondent on his behalf is readily explicable having regard to the fact that the Applicant was required to pay a monthly administrative fee of HK$50,000 to the Respondent.

(3)  In respect of §44(4), we do not see how the fact that there were two different versions of the Repayment Confirmation can assist the Applicant’s case. One version was signed by the Applicant, and the other by the Respondent. Their contents were materially the same. Insofar as the allegation that the Borrowing Confirmation and the Repayment Confirmation were signed by the Applicant unwillingly is concerned, it has been dealt with at §39 above.

(4)  In respect of §44(5), Mr Liu’s argument is fully answered by the Judge’s findings at §§104 and 114 of the Judgment (referred to in §45 above). As for the fact that Blue Planet’s services fees were collected by the Respondent in the first instance, see §47(2) above.

48.In all, even if, contrary to our views, the Judge made any error of law as contended by Mr Liu, we are still not satisfied that the Applicant should properly be regarded as an employee of the Respondent at the time of the accident, or that he sustained injuries by accident arising out of and in the course of his employment by the Respondent on 13 December 2015.

DISPOSITION

49.For the foregoing reasons, the Applicant’s appeal is dismissed with costs to the Respondent, to be taxed if not agreed.

Mr Billy Liu, instructed by M.C.A. Lai Solicitors LLP, for the Applicant (Appellant)

Ms Phillis Loh, instructed by Lam, Lee & Lai, for the Respondent