Poon Shing Hin v. Li Wai Chun Transportation Company Ltd

HCLA 22/2023

[2024] HKCFI 2564

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL NO 22 OF 2023

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO 2077 OF 2022)

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JUDGMENT

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A.  INTRODUCTION

1.This appeal is brought by the Defendant, with leave granted by this Court on 2 November 2023, against the Award made by Deputy Presiding Officer Cheng Yu-kit Bosco (“Deputy Presiding Officer”) on 31 May 2023 (as amended upon review on 17 August 2023).

2.The Claimant was employed by the Defendant as an office worker from September 2018 to July 2022.  In a nutshell, the sole issue in dispute before the Labour Tribunal was the existence of an oral agreement (alleged by the Claimant and denied by the Defendant) entered into by the Claimant and Madam Chang Man Shan Yvette (“Madam Chang”) on behalf of the Defendant on 1 April 2019, whereby the Defendant would pay the Claimant at the end of his employment an allowance of HK$3,000 per month, plus a bonus equivalent to 3 months’ salary should he work for the Defendant for 3 years, 8 months’ salary should he work for 5 years and 12 months’ salary should he work for 10 years (“Oral Agreement”).

3.By this appeal, the Defendant contends that the Tribunal erred in law in finding in the Claimant’s favour as to the existence of the Oral Agreement.

B.  BACKGROUND

B1.  Uncontroversial factual background

4.The following background facts are uncontroversial:

(1)  The Defendant company is named after its founder, Madam Li Wai Chun.  At all material times, the Defendant has carried on business operating public light buses.  Madam Li’s son, Mr Lam Kin Wah (“Mr Lam”), married Madam Chang in 1996.  Following their marriage, the shareholding in the Defendant was transferred to Mr Lam and Madam Chang in the respective ratios of 60:40.  Mr Lam and Madam Chang became the 2 directors of the Defendant.

(2)  The Claimant commenced his employment with the Defendant as an office worker on 3 September 2018.  There was no written contract of employment.

(3)  At all material times while the Claimant worked for the Defendant, Madam Lau Mei Kuk (“Madam Lau”) was his office colleague.

(4)  Mr Lam and Madam Chang divorced on 14 December 2018.  Thereafter, in May 2022, Madam Chang ceased to be a director and shareholder of the Defendant.

(5)  On 1 July 2022, the Claimant sent a WhatsApp message to a Madam Tam of the Defendant giving notification of his resignation.

(6)  On 7 July 2022, the Claimant went to the Defendant’s office to collect his pay cheque for the month of June 2022.

B2.  The contentions as to the Oral Agreement

5.After resigning in early July 2022, the Claimant brought the present claim in the Labour Tribunal against the Defendant by way of Form 2 dated 26 August 2022 seeking payment of the bonus and allowance pursuant to the Oral Agreement which he had entered into with Madam Chang on 1 April 2019.

6.In the Claimant’s witness statement dated 1 September 2022, his factual account of the circumstances in which the Oral Agreement was formed was as follows:

“本人經籃球教練介紹於2018-9-3入職此公司 (教練與此公司老闆張文珊小姐是朋友)。

…2019年4月份時公司解僱了其中一名同事，此後只剩下本人及劉美谷小姐2 人。

張小姐隨後向我表示，該同事主要因為經常偷懶而被炒，她認為我老實不偷懶，希望我盡心努力繼續工作，並向我保證公司不會炒我。她亦表示從教練口中知道我家庭有經濟問題，故承諾只要我一心一意留在公司，由2019年4 月1日起每月另加$3000 給我作為津貼。

張小姐亦表示，她是一個不喜歡經常換人的老闆，像劉小姐已為她工作了十年多，除了不希望浪費時間教導新人外，亦希望保留好員工，因誠實又可靠的員工確實難求。她知我讀書成績不太好，鼓勵我不要經常轉工，多向劉小姐學習，並承諾做滿3年另加我3個月薪金作為獎金，做滿5年有8個月，做滿10年便有12個月獎金，津貼同獎金會係我將來離職時一齊支付。” (Emphasis supplied)

7.There was no contemporaneous written document recording/evidencing the Oral Agreement.

8.At the time when the Oral Agreement was allegedly made, the Claimant’s monthly salary was HK$15,000.  Accordingly, the allowance of HK$3,000 per month represented 20% of his monthly salary.

9.The Claimant filed a witness statement from Madam Chang dated 3 October 2022 which contained the following in relation to the formation of the Oral Agreement:

“至2019年4月初某日，職員劉美谷在寫字樓向我表示因爲公司最近解僱了一名員工引致潘承軒不安。由於感覺潘承軒已經能掌握公司運作，加上本人爲了節省公司成本亦不想再請人頂替，故當時已即時向潘承軒承諾公司不會炒他，叫他放心工作，以及每月公司會另加津貼及獎金給他，有關事情劉美谷亦知悉的。本人寧願加多一些津貼或薪金培育可用及信賴之員工，在公在私我憧憬潘承軒將來能獨當一面，踏踏實實留低努力工作，我希望栽培他成爲我的左右手，便想再找個機會與他詳細傾談。

在2019年4月6日那天我去了銀行提取現金出糧，回公司後我與他一起點算及分派好現金 (因各人薪金不同，爲了安全我們不方便在站頭數錢)。之後我載他上葵盛總站交給站長分發給司機。在車上我便趁機詢問他的工作狀況，他表示基本上沒有大問題，我認真跟他表示希望他留低專心努力工作，公司不會炒他及不會待簿他，如果炒他會補大筆錢給他作補償，每年一定會給他雙糧等。由於他有時會外出幫公司做事，有時因颱風等特發情況甚至需於公司留宿，故本人再一次向其承諾會由其入職日期起每月另給他$3000津貼，作爲交通津貼及彌補炒了另一員工給他工作量增加之補償。

我續跟他説劉美谷已在公司工作了十年多，經驗豐富，叫他多向劉小姐學習，並勸他做工盡量不要經常轉工，否則會給老闆非常不好的印象。我向他表示只要他努力為公司，公司必定會回報他。我鼓勵他做得越耐越好，做滿3年另加3個月薪金作爲獎金，做滿5年有8個月，做滿10年便有1年獎金，假若真的為公司服務超過十年，届時再商議其他福利及獎賞。我因知悉其家庭問題，感覺其難於儲蓄，故我希望能幫得上他，所以表明獎金及每月的3仟元津貼需滿足有關要求後，於其將來離職時才會一次過支付給他。”

…

*每月$3000津貼

本人原意是給潘承軒加人工，但礙於其家庭問題，本人預計即使每個月其收入增多3仟元，其同樣會難於儲錢，我希望幫到他，所以於2019年4月6日向其承諾由其入職日起計每月另加$3000津貼及獎金等，會於其將來離職時才一次過支付，届時其就不會無錢了。

*獎金

由於本人不希望寫字樓經常換人，故以獎金吸引他，希望他做得越耐越好，做得越耐越多獎金，獎金亦是要滿足有所要求後，於離職時才會支付的。” (Emphasis supplied)

10.The Claimant also adduced a witness statement from Madam Lau dated 8 February 2023, which contained the following as to how the Oral Agreement arose:

“至2019年4月頭某日，本人在公司看見潘承軒先生悶悶不樂。本人向其查詢後得知，其因我們早解僱了1名寫字樓員工而令其擔憂其會否亦會被公司解僱，本人已即時向其講解公司不會解僱他，相反，張小姐十分信任他，但他看似十分懷疑。當時適逢張小姐在其辦公室内，故本人即席大聲呼喊張小姐出來與阿潘講清楚令其釋疑。張小姐當時步出辦公室門外向潘承軒解釋之前解僱該員工是因其古古惑惑及經常偷懶，並盛讚潘承軒做得唔錯及老實等。以及講解希望他不要多想無謂之事影響工作，並表明公司一定不會解僱他，如果炒他公司會補一筆大錢給他作補償。以及希望他做得越長時間越好，做得長時間會有獎金，做滿3年有3個月獎金，做滿5年有8個月，做滿10年有1年薪金做獎金，如果做超過10年，到時仲會另加獎賞及其他福利 張小姐仲表示，知道他情況，有意加人工給他，但加幾多都無用，都會用晒，公司不如每個月加$3000津貼給他，由他入職時開始計算，但講明該津貼不會每個月支付，公司會幫他儲起該些津貼，待其將來離職時才一次過領取 到時希望該筆錢可以幫到他。在此之前，張小姐已向本人了解清楚潘承軒的平常工作態度，並與本人商量給予津貼或獎金之類來鼓勵潘承軒令其全心全意留在公司，不要像後生仔做做下便辭職走人。由於本人早已知道張小姐想法，故當日本人看見潘承軒情況，便要求張小姐與潘承軒講清楚。” (Emphasis in bold supplied)

11.At this juncture, it should be pointed out that there are 2  obvious and material discrepancies relating to the Oral Agreement in the factual accounts given by the Claimant on the one hand, and Madam Chang and Madam Lau on the other:

(1)  In relation to the start date of the allowance of HK$3,000 per month, the Claimant says it started in April 2019, whereas Madam Chang (both in her witness statement and in the Acknowledgement Letter referred to in paragraph 13 below) and Madam Lau say that it started when the Claimant commenced working for the Defendant (ie “backdated” to September 2018).  It is worth noting that in Item B of the claim form (Form 2), the Claimant’s claim for allowance of HK$3,000 per month covered the entire period of employment with the Defendant (“在職期間”) totalling 45 months and 37 days (ie “28/30 [days in September 2018] + 45 [months] + 9/31 [days in July 2022]”).  At the start of the trial on 17 April 2023 (before giving evidence), upon the Deputy Presiding Officer’s query, the Claimant said that he did not pay attention to the start date of the allowance when he and Madam Chang reached the Oral Agreement.  The Claimant then accepted that the start date of the allowance was 1 April 2019, which the Deputy Presiding Officer pointed out was also what the Claimant had said in his witness statement.  Upon the Deputy Presiding Officer’s query about Form 2, the Claimant confirmed that he maintained his claim for allowance of HK$3,000 per month starting from the date that he commenced his employment with the Defendant.  After the Deputy Presiding Officer referred to the Claimant’s witness statement again, the Claimant accepted that his witness statement was correct in stating that the start date of the allowance was 1 April 2019.^[1]  However, subsequently, in his written closing submissions, the Claimant sought to change his factual account as follows:

“… 我聼到有津貼及獎金時已很開心，並無清楚聽到由幾時開始計算，我以爲在4月頭講，必然由4月1日開始。後聼劉美谷講述，話張小姐講由我入職日起計，因爲劉小姐負責計算薪酬，所以她有記錄。本人知道在法庭要講真話，而本人當時確實無聼清楚是由入職日起計，因爲當時已非常喜出望外所以才寫下以自己感覺認爲是由該月(4月1日)起計。…”

(2)  As for the purpose of the allowance, the Claimant says that Madam Chang knew that his family had financial difficulties, “guaranteed” that the Defendant would not lay him off and told him that she wanted him to continue working for the Defendant.  In a similar vein, Madam Lau says that Madam Chang told the Claimant that the Defendant would not lay him off and he would be rewarded for continuing to work for the Defendant.  On the other hand, Madam Chang herself says that the allowance was to subsidise the Claimant’s transport expenses and to compensate for the increased workload as there was one fewer work colleague (which reasons had not been mentioned by either the Claimant or Madam Lau in their witness statements).

12.As mentioned above, on 1 July 2022, the Claimant sent a WhatsApp message to Madam Tam of the Defendant giving notice of his resignation (Exhibit D-2).  He requested payment of all outstanding wages, allowances, bonuses and leave payments without expressly mentioning the Oral Agreement:

“請於七日內繳付清公司欠本人之所有應付薪金、津貼、獎金及假期薪金。謝!”

13.The Claimant adduced a letter allegedly signed by Madam Chang on 1 July 2022 (Exhibit C-5) (“Acknowledgement Letter”) which stated the following:

“致: 潘承軒

於2022-7-1收到閣下辭職通知，本人批准閣下無需通知期，即日可離職。而閣下有許多累積年假未放，本人亦同意你由2022-7-2起放取7日年假以代替通知期，假期完畢即7月9日正式離任。

另外，閣下在最後糧期亦應該收取公司當年向你承諾應付款:包括每月$3000 津貼(由入職起至離職止)，以及做滿3年後可獲取的之3 個月薪金獎金。” (Emphasis supplied)

14.The witness statements of the Claimant, Madam Chang and Madam Lau (despite all post-dating the Acknowledgement Letter) did not address the circumstances in which Madam Chang signed and the Claimant obtained the Acknowledgement Letter.  However, at trial, Madam Lau testified that:

(1)  It was Madam Lau (rather than the Claimant) who requested Madam Chang to write the Acknowledgement Letter.

(2)  Madam Chang was in the UK when she signed the Acknowledgement Letter and sent it by post to Madam Lau, who received it in early July.  Madam Lau’s recollection was that she had already received the Acknowledgement Letter when she went to the Defendant’s office on 7 July 2022.^[2]

15.As mentioned above, on 7 July 2022, the Claimant went to the Defendant’s office to collect his pay cheque for the month of June 2022.  Madam Lau testified that she went together with the Claimant to the Defendant’s office on that day to submit her sick leave certificates and request her own annual leave payment.  The Claimant acknowledges that on this occasion, he did not mention the Oral Agreement, nor did he provide the Acknowledgement Letter, nor did he request any payment of the allowance and bonus pursuant to the Oral Agreement.  His explanation in his written closing submissions was as follows:

“何解7月7日不提供確認書事項

7 月7 日上公司寫字樓是收取6月份薪金及多年欠付的年假款項，當時公司只比 6月份糧單我簽，並沒有比7月份糧單我簽，事實我7月1日才辭職，然後翌日起放完7日年假後才正式離職，所以未有7 月份糧單亦正常，所有沒有提到津貼及獎金事。”

…

“劉美谷出庭作證時已清楚表示其於7月頭收到確認書，但其亦表示不清楚是那日收到以及是那日交給我的。我因在7月12日已傳給譚小姐，依我會議是由劉小姐交給我後我好快已傳給譚小姐，所以我覺得是在7月7日後我才收到的，並不存在被告人所指我們口供不一致。”

B3.  Procedural history in the Labour Tribunal

16.The Claimant commenced the claim against the Defendant by way of Form 2 dated 26 August 2022.

17.The call-over hearing took place before the Deputy Presiding Officer on 30 March 2023.  At that hearing, the Claimant made an application for Madam Chang to be permitted to testify at the trial remotely by video link from the UK, the reason being that Madam Chang had to work in the UK and it was inconvenient for her to take time off work.  The Defendant’s representative opposed the Claimant’s application.  The Deputy Presiding Officer indicated that the reason given was not one that would usually be accepted by the court.  The Deputy Presiding Officer held that being unwilling to return to Hong Kong to testify for work reasons was not a reason for allowing a witness to testify remotely.  After the Deputy Presiding Officer asked the Claimant to consider if he still wished to pursue the application, the Claimant decided to withdraw his application.

18.The trial took place on 17 and 18 April 2023.  The Claimant, Madam Lau and the Defendant’s representative (Ms Tam) gave evidence.  Madam Chang did not appear and did not testify.  At the end of the trial, the Deputy Presiding Officer gave directions for the lodging of written closing submissions.

19.The Deputy Presiding Officer delivered the Award orally on 31 May 2023.  In short, he held in favour of the Claimant on the existence of the Oral Agreement and awarded the Claimant a total sum of HK$167,132 consisting of: (1) HK$45,000 bonus; (2) HK$120,000 allowance; and (3) HK$2,132 costs.

20.In delivering the Award, the Deputy Presiding Officer did not expressly identify the 2 material discrepancies identified at paragraph 11 above.  However, if the sum of HK$120,000 awarded for the allowance is divided by HK$3,000, it can be seen that the awarded sum was calculated based on a period of 40 months.

21.After delivering the Award, the Deputy Presiding Officer reviewed the Award on his own motion (pursuant to section 31 of the Labour Tribunal Ordinance, Cap 25 (“Ordinance”)) to amend the calculation of the allowance on the basis of 39 months instead of 40 months.  Although the Deputy Presiding Officer had not made an express finding as to the start date for calculating the allowance when making the Award, in the Reasons for Review Decision the Deputy Presiding Officer expressly held that the start date was 1 April 2019 and accordingly adopted 39 months (April 2019 – June 2022) as the basis for calculating the allowance.^[3]

22.The Defendant also raised 8 grounds of review, all of which were rejected by the Deputy Presiding Officer.

C.   RELEVANT LEGAL PRINCIPLES

23.In applying for leave to appeal from this Court, the Defendant relied on the dicta of B Chu J in Mak Wai Man v Richfield Realty Ltd, HCLA 28/2015 (unrep, 30/10/2015) at §16:

“(1) Under s 32 of the Labour Tribunal Ordinance, a party may only apply for leave to appeal on the ground that the award of the Tribunal is erroneous on point of law or outside its jurisdiction;

(2) The threshold onus of an application for leave is to show that the intended appeal has arguable grounds;

(3) Apart from errors of law, leave will also be granted if the Tribunal’s determination (a) was made without regard to relevant factors, (b) was made without evidence, or (c) there was failure to discharge the statutory duty to investigate and such failure has given rise to injustice, in that a fair and proper determination of the claim cannot be attained.” (Emphasis supplied)

24.In relation to the “statutory duty to investigate”, section 20 of the Ordinance provides that:

“(1) The hearing of a claim shall be conducted in an informal manner.

(2) The presiding officer may subpoena witnesses, order the production of any document, record, book of account or other exhibit and put to a party or witness such questions as he may think fit.

(3) The presiding officer shall investigate any matter which he may consider relevant to the claim, whether or not it has been raised by a party.”

25.Further, section 27 of the Ordinance provides that:

“(1) The tribunal may at any time during the hearing of a claim allow a witness or a party to give evidence on oath or unsworn.

(2) The rules of evidence shall not apply to proceedings in the tribunal, which may receive any evidence which it considers relevant.”

26.It is well-established that Labour Tribunal proceedings are inquisitorial in nature and that a Presiding Officer is under a duty to investigate: see Chan Suk Bing Angie v Harbour Phoenix Ltd [1992] 2 HKC 459, perDHCJ Jerome Chan (as he then was) at p 462B-C.  A Presiding Officer errs in law if he/she fails to discharge that duty properly, and it is open to an appellate court to consider if the Presiding Officer had discharged that duty by investigating a relevant matter which ought to have been investigated (see p 462F-G).  An appellate court should intervene if the Presiding Officer’s lack of investigation gave rise to injustice, in that a fair and proper determination of the claim could not be attained (see p 462I).

27.The rationale for this is that in Labour Tribunal proceedings, parties act in person without the benefit of legal representation.  As explained by Waung J in Leung Wan Kee Shipyard Ltd v Lik Shau Foo [1995] 3 HKC 229 at pp 233HI-234A:

“There is a duty on the presiding officer to investigate all matters on his own volition and direct the parties to the right issues and seek from them the relevant material and evidence. I, of course, appreciate that this is an onerous duty but this is what the law demands and bearing in mind that lay people with very little or no knowledge of the law are regularly before the Labour Tribunal, I do not see how the law can demand any less from the Tribunal.”

28.In Ng Ming v Cheung Wah Investment Co Ltd, HCLA 10/2003 (unrep, 13/06/2003), DHCJ Lam (as Lam PJ then was) observed that:

(1)  Section 14 of the Ordinance lays down a procedure of inquiry conducted by a Labour Tribunal officer by which the parties are required to go through a process of preparation and investigation of their respective cases prior to trial.  In particular, section 14(4) gives extensive power to the Tribunal officer for the purpose of such inquiry, including the recording of statements from witnesses and requiring the production of relevant documents (see §10).

(2)  Hence, by the time a case comes for trial before a Presiding Officer, he/she is entitled to work on the basis that a party has included the substance of the evidence of witnesses in their statements and that relevant documents have been produced (see §11).

(3)  If the Presiding Officer discerns that there are relevant matters which the parties have not explored, he/she is obliged by section 20(3) of the Ordinance to look into it and should invite the parties to comment and guide (and if necessary, direct) them to produce further evidence or documents (see §11).

29.In the present case, as mentioned in paragraphs 21 and 22 above, after delivering the Award, the Deputy Presiding Officer exercised his power to review the Award on his own motion in relation to the calculation of the allowance and on the Defendant’s request in relation to 8 grounds of review.  In this connection, section 31(1) of the Ordinance provides that the Labour Tribunal may “… review the award or order and on such review may re-open and re-hear the claim wholly or in part and may call or hear fresh evidence and may confirm, vary, or reverse his previous award or order”.

D.  ANALYSIS OF THE GROUNDS OF APPEAL

D1.  Ground 1: The Deputy Presiding Officer erred in law by failing to exercise his power under section 20(2) of the Ordinance to require Madam Chang to testify as a witness

30.As mentioned in paragraph 7 above, there was no contemporaneous document evidencing the Oral Agreement.  The Claimant and Madam Chang were the only parties to the alleged Oral Agreement.

31.In particular, as mentioned in paragraph 11 above, there were 2 material discrepancies in relation to the Oral Agreement (namely, the start date and the purpose of the allowance) in the factual accounts given by the Claimant on the one hand, and Madam Chang and Madam Lau on the other in their witness statements.  These were not minor inconsistencies.  They called into question the veracity of the Oral Agreement alleged by the Claimant.  In relation to the “start date” inconsistency, this is what the Deputy Presiding Officer himself said at page 10 of the Trial transcript:

“官：咁當然喇，申索人，你自己亦都諗一諗嘞，即係呢個亦都係你嗰個案情一個好大嘅問題，首先，第一樣嘢，我淨係睇你證人供詞已經睇到你同呢個張小--劉小姐之間講嘅嘢有出入喇，咁究竟係咪真係咁--咁可信呢？呢個你自己要諗嘞，因為好簡單咋嘛，究竟呀，淨係嗰個獎金呀，同埋嗰個津貼係由幾時開始計呀，你嘅證人供詞話4月1 號開始計，你剛剛同我講話唔清楚，劉小姐話畀我聽由入職開始計，三個版本喇已經，係咪？” (Emphasis supplied)

32.Accordingly, to discharge his statutory duty to investigate, the Deputy Presiding Officer had to consider and test the evidence of the Claimant, Madam Chang and Madam Lau in order to properly revolve these 2 material discrepancies so as to reach a finding as to whether the Oral Agreement as alleged by the Claimant truly existed.

33.However, the Deputy Presiding Officer did not receive (and therefore could not test) Madam Chang’s evidence, and did not resolve the 2 material discrepancies in relation to the Oral Agreement when delivering the Award.

34.As mentioned above, during the call-over hearing on 30 March 2023, the Claimant had made an application for Madam Chang to be permitted to testify remotely from the UK by video link.

35.If the Deputy Presiding Officer had properly considered sections 20 and 27 of the Ordinance, he should have allowed Madam Chang to testify by video link, given the importance of testing her evidence when conducting his investigation and deciding whether the Oral Agreement as alleged by the Claimant existed.

36.The fact that (1) the Defendant opposed the Claimant’s VCF application, and (2) the Claimant eventually withdrew his application does not affect the foregoing analysis.  This is because the Deputy Presiding Officer was under a statutory duty to investigate and had the power to allow on his own motion Madam Chang to testify remotely by video link if her evidence was material to deciding the issue requiring determination (ie the existence of the Oral Agreement).  As set out in paragraph 24 above, section 20(2) of the Ordinance provides that “The presiding officer may subpoena witnesses, order the production of any document, record, book of account or other exhibit and put to a party or witness such questions as he may think fit”.  Further, section 20(3) of the Ordinance provides that “The presiding officer shall investigate any matter which he may consider relevant to the claim, whether or not it has been raised by a party”. (Emphasis added).

37.Instead, the Deputy Presiding Officer disregarded Madam Chang’s witness statement,^[4] did not receive and test Madam Chang’s evidence (by way of video link), and failed to resolve the said material discrepancies.  In such circumstances, the Deputy Presiding Officer’s finding that the Oral Agreement existed was reached without conducting a full and proper investigation, and cannot stand.

38.In respect of the “start date” inconsistency, the Deputy Presiding Officer eventually regarded this as a non-issue (see Trial transcript p 23B-E).  This approach is endorsed by the Claimant at §47 of his Skeleton Submissions for the present hearing: “It is submitted that as both parties agreed the start date for the allowance was on 1 April 2019, it was a non-issue and the Deputy Presiding Officer did not need to make further enquiries on this discrepancy. …”.

39.With respect, this is clearly a wrong approach.  By regarding this a non-issue because the quantum is not disputed, the Deputy Presiding Officer has simply failed to resolve a material discrepancy between the evidence of the Claimant and that of Madam Chang/Madam Lau.

D2.  Ground 2: The Deputy Presiding Officer erred in law in accepting the Acknowledgement Letter as evidence in the absence of Madam Chang testifying as a witness

40.The Deputy Presiding Officer appears to have expressly relied on the Acknowledgement Letter as a piece of evidence in finding in the Claimant’s favour regarding the existence of the Oral Agreement.  As stated at §18(5) of the Reasons for Decision:

“基於該確認書、證物D2 ，與及申索人和劉女士的證供，本席接納，除了曾於達成該口頭協議後向劉女士了解張女士會否履行該協議外，申索人於2022 年7 月1 日前才再次向劉女士就張女士會否確認該口頭協議表示關注。由此可見，於2019 年約5 月至2022 年7 月1 日其間，沒有發生過任何事情足以令申索人質疑張女士的誠信/或權力。” (Emphasis supplied)

41.On the other hand, the Deputy Presiding Officer stated the following at §7 of the Reasons for the Review Decision:

“… 被告公司代表接納她沒有爭議由張小姐所簽署的書面確認書的真確性，故亦沒有於盤問時就該確認書的真確性向申索人及劉女士提出任何問題及論點。因此，被告公司沒有任何基礎投訴本席不應考慮該確認書。無論如何，本席根本沒有依賴張女士的證人供詞與及該確認書已達致本席認為申索人與張女士之間的口頭協議確實存在的裁定。” (Emphasis supplied)

42.The Deputy Presiding Officer’s statement that he did not rely on the Acknowledgement Letter in reaching his finding as to the existence of the Oral Agreement is inconsistent with what he had previously stated at §18(5) of the Reasons for Decision (set out at paragraph 40 above).

D3.  Ground 4(2): The Deputy Presiding Officer erred in law in failing to consider or adequately consider the Defendant’s contention that the Claimant colluded with Madam Chang and Madam Lau to concoct the Oral Agreement

43.When the Defendant’s representative cross-examined Madam Lau, the Deputy Presiding Officer prevented the Defendant’s representative from pursuing a line of questioning regarding whether Madam Chang had ever reached an oral agreement with Madam Lau regarding any allowance/bonus to her.  The Deputy Presiding Officer stopped such line of questioning as he took the view that: (1) it was irrelevant to his assessment of the Claimant’s credibility; and (2) it was an attempt by the Defendant to pin down Madam Lau’s own case regarding any allowance/bonus owed to her as Madam Lau may initiate her own proceedings against the Defendant. ^[5]

44.I agree with the Defendant’s submission that such a line of questioning was, however, relevant in 2 respects:

(1)  It was relevant to consider if Madam Chang had a practice of making oral agreements (without any written record) with other employees (apart from the Claimant) on matters relating to remuneration.  This was relevant to assess the inherent probability/improbability of the Claimant’s allegation regarding the existence of the Oral Agreement.

(2)  By stopping the aforesaid line of questioning, the Deputy Presiding Officer prevented the Defendant from having a proper factual and evidential basis to put to Madam Lau that she was a disgruntled employee who also had an alleged oral agreement on allowance with the Defendant through Madam Chang, and that therefore she was not a disinterested and impartial witness.

45.After the Award was delivered, by Ground of Review 8, the Defendant invited the Deputy Presiding Officer to exercise his power under section 31(1) of the Ordinance (to review the award or order and on such review may re-open and re-hear the claim wholly or in part and may call or hear fresh evidence and may confirm, vary or reverse his previous award or order) and consider a new factual matter, namely the commencement by Madam Lau of her own proceedings on 7 June 2023 against a related company of the Defendant in LBTC 1823/2023, in which Madam Lau alleged that she and Madam Chang had reached an oral agreement regarding remuneration, which would be repayable in one lump sum upon the termination of her employment.  The Defendant invited the Deputy Presiding Officer to reconsider, in the light of this new matter, his assessment and finding that Madam Lau was a credible and reliable witness, since Madam Lau could not be regarded as an impartial and disinterested witness.

46.At §9 of the Reasons for Review Decision, the Deputy Presiding Officer refused to reconsider his assessment and finding as to Madam Lau’s credibility and reliability as a witness for the following reasons:

“關於理由八，被告代表公司指出本席應考慮劉女士於勞資審裁處對被告公司所提出的申索。本席留意到該申索是該裁決宣布後，即2023 年6 月7 日才存檔勞資審裁處的。本席不同意被告公司的說法，即本席須考慮這所謂的新證據。劉女士對被告公司提出申索這一事件是於該裁決宣布後才發生。本席看不到被告公司為何可以以一件於該裁決宣布時尚未發生的事件來支持此覆核。”

47.I agree the Deputy Presiding Officer has erred in law and fettered his discretion in applying section 31(1) of the Ordinance.  This statutory provision empowered him to “re-open and re-hear the claim wholly or in part” and “call or hear fresh evidence”.  Therefore, the Deputy Presiding Officer was clearly entitled to receive fresh evidence (in this case, the new evidence regarding the commencement by Madam Lau of her own Labour Tribunal claim against the Defendant after the Award in this case was delivered) in reviewing the Award.  This new evidence had a bearing on the assessment of Madam Lau’s impartiality as a witness and, in turn, her credibility and reliability.

F.  CONCLUSION

48.For the reasons set out above, I would allow the appeal, set aside the Award and remit the claim to the Labour Tribunal for re-trial before another Presiding Officer. 

49.For completeness, I should record that, in my view, Grounds 3 and 4(1) of the Defendant’s Grounds of Appeal have not been made out, the Deputy Presiding Officer cannot be said to be erroneous in point of law in respect thereof.

50.As far as costs is concerned, the Defendant submits that costs should follow the event.

51.On the other hand, the Claimant submits that whilst as a matter of principle, costs of an appeal should follow the event and be to the successful party, the Court may, in a Labour Tribunal appeal, exercise its discretion not to order costs against an employee even if the employer is wholly successful and is without fault.  See Owyang Loong Shui Ivan v Winco Paper Products Co Ltd [2018] 6 HKC 359 at §63:

“63. As a matter of principle, costs of an appeal should follow the event and be to the successful party. However, the court may, in a labour appeal exercise discretion not to order costs against a respondent employee even if the appellant employer is wholly successful and is without fault. This applies where eg the employee is unrepresented on appeal and has not put forward a case in bad faith (ie a false, frivolous or vexatious claim or false evidence) and has not misbehaved himself in the conduct of the litigation; or he is a passive respondent in the appeal. To the contrary, if he is legally represented on appeal, he knows of the consequence of costs and he no longer litigates with the expectation of low-costs adjudication. The rationale has been set out in Ali Shoukat v Hang Seng Bank Ltd [2005] HKCU 1869 at §§21-24, 20 June 20015, Deputy Judge To (as he then was).” (My emphasis supplied)

52.Here, the Claimant is legally represented, he should know of the consequence of costs if the appeal is successful.  I see no good reason to depart from the starting position that costs should follow the event.

53.Accordingly, I order that costs of the appeal (including the application for leave to appeal) be paid by the Claimant to the Defendant, to be taxed if not agreed.  The Claimant’s own costs be taxed in accordance with the Legal Aid Regulations.

54.The above order as to costs is nisi and shall become absolute in the absence of any application within 14 days to vary the same.

55.Lastly, I express my gratitude to counsel on both sides for their helpful assistance in this matter.

Mr Dexter Leung, instructed by Messrs Tang & So, for the Defendant (Appellant)

Mr Derek Hu (assigned by DLA), instructed by Messrs Lau & Chan, for the Claimant (Respondent)