Li Man Kit v. Cf Workshop Co Ltd and Another

DCEC 140/2024

[2026] HKDC 1711

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO 140 OF 2024

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BETWEEN

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DECISION

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1.This is a hearing to determine a preliminary issue as to whether the Applicant (“the A”) has formally withdrawn his intended appeal against the assessment contained in the Certificate of Review of Assessment (“Form 9”) issued by the Employees’ Compensation (Ordinary Assessment) Board (“Assessment Board”) on 28 July 2023.

2.At the commencement of the proceedings, Mr Wong Yuk Hung (“Mr Wong”) was present trying to represent the 1^st Respondent (“the R1”). However, Mr Ho representing the A drew my attention to Order 5A of the Rules of the District Court which states.

“2. Corporations acting by a director (O. 5A, r. 2)

(1) Subject to Order 12, rule 1(2), a corporation may not begin or carry on any such proceedings in the Court otherwise than by a solicitor except as expressly provided by or under any enactment or by this rule.

(2) A corporation may begin or carry on proceedings by one of its directors where—

(a) a solicitor does not act for the corporation in the proceedings;

(b) the director has been duly authorized by the board of directors of the corporation to act on its behalf in the proceedings; and

(c) the director has made and filed at the Registry an affidavit stating that he has been duly authorized by the board of directors of the corporation to act on its behalf in the proceedings and exhibiting—

(i) the original of the resolution authorizing the director to act on behalf of the corporation; or

(ii) a copy of such resolution duly certified by another person who must either be a director or the secretary of the corporation. (L.N. 221 of 2001)”

3.In Court, Mr Ho handed me a copy of the Notice of Resignation of the Company Secretary and Director showing that Mr Wong has resigned on 15 July 2026. Mr Wong also confirmed to me that R1 has no other director. I therefore invited Mr Wong to sit in the public gallery and R1 was treated as absent.

4.For the purpose of this hearing, it is not in dispute that the A had formally lodged an appeal against Form 9 assessment in paragraph 2(b) of the Employees’ Compensation Application (EC Application) filed on 19 January 2024.

5.Mr Lee representing the 2^nd Respondent (“the R2”) however said that the A has withdrawn his intended appeal. He said in 申請人的證人陳述書第30段最後一句話：「為了儘快了結僱員補償申索，我指示律師不用就《表格9》的評估向法庭提出上訴」（「該指示」），已構成撤回他針對表格9就他永久喪失賺取收入能力的評估的上訴（“the impugned statement”）.

6.Mr Lee in his Submission drew my attention to the following case：

“9. In Lam Pui Yi Anita v Secretary for Justice [2005] 4 HKC 256 [R2#3], HH Judge Marlene Ng (as she then was) emphasised at §§44-45 that:-

“44. In my view, where a party intends to appeal against the assessments in Form 7 or Form 9 pursuant to Section 18, it is incumbent on such party to duly and plainly invoke the District Court’s jurisdiction. This is primarily important because unless such jurisdiction is duly and plainly invoked, the assessments in Form 7 or Form 9 remain binding. Further, the other party is entitled under the rules of natural justice to know clearly and plainly whether he has to meet an appeal against the assessments in Form 7 or Form 9.

45. Although there is no prescribed form for such appeal, the party invoking the court’s jurisdiction under Section 18 must notify the court and inform the other party about the appeal in clear, certain and unambiguous terms. The court or the other party should not be left to guess on ambiguous terms or equivocal conduct as to whether there is in truth an appeal or not. …”

7.Both Mr Ho and Mr Lee agree that there is no prescribed form for an appeal and/or withdrawal of an appeal.

8.They also agree that the Notice must be in clear, certain and unambiguous terms communicating to the Court and to the other party.

Issue

9.Is the impugned statement in clear, certain and unambiguous terms?

Discussion

10.Mr Ho in his Submission submitted that:

“the impugned statement was an instruction given to his solicitors at an earlier stage of these proceedings (i.e., prior to 21 March 2025); however, in light of the subsequent developments of the case, the said instruction was clearly not executed. In particular, the Applicant subsequently instructed his solicitors to continue obtaining expert opinions from orthopaedic and psychiatric experts for this case, and obtained the court's directions granting leave to adduce the relevant expert evidence on 15 April 2025, followed by obtaining the respective expert reports in September and November 2025. Both reports explicitly support the Applicant's continued appeal against the Form 9 assessment regarding his permanent loss of earning capacity.

Second, the said passage in the witness statement merely described the instruction previously given by the Applicant to his solicitors; the instruction itself, of course, cannot be equated with he himself having actually withdrawn his appeal against the said Form 9 before the Court.”

11.Mr Lee on the other hand submitted several reasons to counter Mr Ho’s submission. Basically, Mr Lee submitted that if the impugned statement is clear, certain and unambiguous, the solicitors were not required to separately “execute” that instruction. Mr Lee also submitted that the A has been represented throughout and by including such an explicit statement in his witness statement, the A must be taken to have abandoned/withdrawn and waived his right of appeal under section 18 of ECO.

12.A further point raised by Mr Lee is that the witness statement is not an internal communication between the Applicant and his legal representatives; it is a formal court document filed with the Court, served on the other party, and signed personally by the Applicant with his statement of truth. The Applicant’s solicitors must have known the legal significance and consequences of the Impugned Statement in §30 of the witness statement … The inescapable conclusion is that the objective purpose of the Impugned Statement, being a document filed with the Court and served on the other party, was to communicate to the Court and the other party that the Applicant would abandon/withdraw the appeal.

13.Mr Lee further submitted that although the A took the trouble to correct a typographical error in his witness statement, he has never sought to correct or withdraw (albeit ineffective in any event) the Impugned Statement in §30.

14.Mr Lee further submitted:

“18. Fourth, the Applicant’s withdrawal of the appeal and his stated desire to “conclude the employees’ compensation claim as soon as possible” (“為了儘快了結僱員補償申索”) may well be related to the fact that, on 14 March 2025 (i.e. 7 days before the date of his witness statement), he had separately commenced a claim for common law damages for personal injuries against the 1st Respondent and its director Wong Yuk Hung (who is the 1st Respondent’s witness in these proceedings under DCPI 887/2025. In any event, whatever the underlying reasons for his abandonment/withdrawal of the appeal may be, the Applicant’s current disingenuous refusal to acknowledge the clear effect of the Impugned Statement is plainly untenable and flies in the face of his own express statement.”

15.Mr Lee further submitted that when the Court granted leave to adduce expert evidence on 14 April 2025 with expert reports subsequently obtained in September and November 2025, the A’s witness statement was only filed and served on 13 May 2025. In other words, the Applicant had not yet communicated his decision to abandon/withdraw the appeal to the Court and the other party at that time. Therefore, neither the Court nor the other party were aware of the Applicant’s decision to abandon/withdraw the appeal.

16.I agree with most of the Submissions made by Mr Lee. However, going back to the core issue of this hearing, is the impugned statement clear, certain and unambiguous?

17.Mr Ho has helpfully in his Supplemental Opening Submissions translate the impugned statement into English ie, “In order to conclude the employee’s compensation claim as soon as possible, I instructed my solicitors not to lodge an appeal against the assessment in Form 9”. However, the appeal was formally lodged and filed on 19 January 2024. Therefore, what does the impugned statement exactly mean? I do not accept that the impugned statement is clear, certain and unambiguous. It would be clearer if the A stated that in order to conclude the employees’ compensation claim as soon as possible, I would not proceed with the appeal even though it has been lodged.

18.Mr Ho invited me to have a look of the joint written application dated 15 August 2025 (‘the Joint written application”) seeking directions from the Court for the solo orthopaedic expert from Dr Fu and the solo psychiatric expert report from Dr Li to be complied on or before 16 October 2025.

19.At that time, the R1 was still legally represented and it was after the A’s witness statement was served. Under paragraph 9, it stated jointly by both parties’ solicitors that, “Form 9 issued on 28 July 2023. The Applicant has appealed against the assessment in Form 9.”

20.Subsequently, HHJ KC Chan made an order in terms of such application.

21.Mr Ho submitted in his Further Points of Reply to the Board’s Preliminary Issue:

“10. In this context, under the normal course of things, the Judges in charge of the case at different stages, for instances HHJ KC Chan when granting the Joint Written Application filed on 15 August 2026, and HHJ Phillis Loh (at the direction hearing on 15/5/2025), prima facie did not consider the averment as contained in the paragraph 30 of the Applicant would constitute an withdrawal of his section 18 appeal at all. Rather, in response to the applications taken out by the parties treating the section 18 appeal as ongoing (noting that R1 already has been served with the Applicant's witness statement back in May 2025) and inviting the court to make the relevant directions direction accordingly, namely,

(1) in the Joint Written Application dated 15/8/2025, they invited the Court to grant directions for the compilation of the expert report before certain date.

(2) in the direction hearing on 15/5/2026, they agreed to the Court that the two expert reports can be adduced at the trial without calling the makers to testify at the trial.

(3) It is noteworthy that R2's legal representative was also present at the direction [B1/33/preamble clause]. They did not inform the Court that they would take the point that the Applicant has already withdrawn his section 18 appeal, therefore the Form 9 assessments are binding on him, and there is therefore no need for the court to give any direction that the expert reports be adduced as part of the evidence for the trial.

11. In light of the aforesaid, according to the legal principles as submitted to this Honourable Court (see CFA case in Unruh, Holding Nos(9)-(11), and Mengiwa Property Investment Ltd, para 29(6)(a) and (b)), R1 would be estopped (even if it wants to) from taking the point that the Applicant has withdrawn his appeal, so he is bound by Form 9, and cannot resort to the expert evidence to ask the Court to refer to the same to determine the appropriate percentage of his permanent LOEC, because the 3% assessment as stated in Form 9, since it is already binding on him.

12. On this estoppel point, R2's position would be no better than R1. If R1 is estopped, R2 cannot contest the employee's claim in the place of the employer, let alone in a better position than the employer.”

22.Mr Lee however submitted thar these arguments are fundamentally flawed. He explained:

“28. In Hong Chun Tak v Yip Kan Kee Contracting Co Ltd (No 2) [2020] 2 HKLRD 1355 [R2#16], HH Judge KC Chan pertinently held as follows:-

“16. On 18 October 2019, interlocutory judgment on liability was entered against R1 (“the Default Judgment”) and an unless order was also made that if it failed to file and serve a witness statement as to fact within 28 days, it would “be debarred from adducing any factual evidence in the Trial” (“the Unless Order”).

…

47. R2 then argues that the [Employees Compensation Assistance Fund] Board [i.e. R3 in that case] is bound by the Unless Order, that it should have first applied for relief against the Unless Order and not try to by-pass it by seeking leave to file the witness statement of Yip.

48. This argument again is predicated on R2’s construction of the words “to take over the defence as if it were the employer in the proceedings” in section 25A(a) such as to subject the Board to all the consequences of failure hitherto visited upon the employer who failed to attend or contest.

49. I think the answer is simple. Section 25A(a)(v) provides that the Board can apply to join “at any time”. In the usual course of things, it would be most rare for the Board to know that the employer has not attended or has left the claim uncontested before the fact. The Board would know only after the fact when sometimes various forms of adverse orders have already been made against the employer in his absence. The Board would not be in a position to explain or justify those failures of the employer so as to seek relief. The Board would be hand-tied and crippled and would not be fully able to actively test, limit or resist the employee’s claim regarding liability and/or quantum (among others) to ensure that the Fund’s resources are properly applied, which is the very purpose of s.25A(a).

50. Moreover, as Ribeiro PJ [in Wo Chun Wah] said in the passage quoted in [35] above: “Unlike section 25 (dealing with ECO claims), s.25A(a) is not explicit about the consequences of joinder. It does not, for instance, expressly provide for the rights and liabilities of the employer to be vested in the Board …”. The section in my view clearly does not seek to substitute the Board for the employer, thereby subjecting the Board to all the consequences of failure or inaction of the employer.

51. I hold that the Board is not bound by the Unless Order, and this ground fails.” (emphasis added)

23.In Hong Chun Tak v Yip Kan Kee Contracting Co Ltd & Ors [2020] HKCA 416 [R2#17], the Court of Appeal dismissed the appeal against the HH Judge KC Chan’s aforesaid judgment. In particular, Kwan VP held at §§42-43 that:-

“42. The contention of Mr Fan is that the Board does not dispute liability or quantum on the part of R1, and neither the Board nor R1 has applied to set aside the Default Judgment or seek relief from sanction imposed by the Unless Order. Section 25A(a) does not allow the Board to cherry-pick, having “[taken] over the defence as if it were the employer in the proceedings”. Further, if the Board is permitted to adduce the evidence of Yip, it would mean that the Board is permitted to circumvent or bypass the Unless Order and to re-open the question of R1’s liability despite the Default Judgment and this would amount to an abuse of process.

43. The judge is correct to reject this contention. We agree with him. The Board is not shackled in its conduct of the defence in the manner as submitted by Mr Fan, we have rejected the restrictive construction of section 25A(a) for the reasons given earlier. There is no circumvention or bypass of R1’s liability in seeking to establish that R2 is severally liable. This ground of appeal is of no merit.” (emphasis added)

24.In Wo Chun Wah v Employees Compensation Assistance Fund Board (2019) 22 HKCFAR 495 [R2#1], in relation to section 25A(b) of the ECAO, Riberio PJ also held at §§24-25 that:-

“24. Unlike s.25 (dealing with ECO claims), s.25A(a) is not explicit about the consequences of joinder. It does not, for instance, expressly provide for the rights and liabilities of the employer to be vested in the Board in respect of the action for damages. Nevertheless, in authorising the Board to take over the defence “as if it were the employer”, the legislature must have envisaged the Board being able actively to test, limit or resist the employee’s claim regarding liability and/or quantum to ensure that the Fund’s resources are properly applied.

25. The consequences of the Board joining the proceedings under s.25A(b) and (c) are even less explicitly spelt out. However, it is a compelling inference that the legislative intent was to enable the Board to be joined as a party to keep an eye on the proceedings in which the employer is still participating, given the Fund’s contingent liability to make relief payments tied to the level of judgments obtained by the employee. Whether, in such circumstances, the Board takes an active role defending against the employee’s claim will obviously depend on the circumstances. If the claim is being properly defended by the employer, the Board might be content essentially to maintain a watching brief and no costs consequences are likely to follow. On the other hand, if the claim is extravagant or collusive or if the employer is not mounting a proper defence, the Board may wish actively to participate in the proceedings to mount an effective defence …”. (emphasis added)

25.Mr Lee then submitted:

“31. Consistently, in the present case, it bears emphasis that the 2^nd Respondent did not join these proceedings to “raise points on behalf of the 1^st Respondent”. On the contrary, the 2^nd Respondent joined these proceedings to contest quantum in order to protect the Fund (given its potential exposure to a statutory application for relief payment should the Applicant succeed in obtaining employees’ compensation payable by the 1^st Respondent) and to assist the Court in coming to a correct ruling. As an independent statutory body, the 2^nd Respondent takes an impartial stance. If an objective assessment of the case reveals a valid legal point that ought to be taken, the 2^nd Respondent is entitled to intervene and pursue it.

32. For the avoidance of doubt, it should also be pointed out that the mere fact that the 2^nd Respondent’s solicitors asked the Applicant to provide a quantification of his claim and clarify whether he would adopt the Paper Mills formula [6/1116] is only customary practice (see §18 of Tsang Chi Chung [R2#13] quoted in §23 above). It simply cannot realistically be elevated to any “endorsement” that the Applicant has a valid extant appeal or is entitled to rely on the Paper Mills formula.”

26.In my view, I note that amongst other documents, the A’s witness statement together the joint written application was sent to the R2 as early as 19 August 2025. In the R2’s solicitors letter dated 8 January 2026, they even asked for a copy of the joint written application and the result thereof. If R2 genuinely believed that the A has withdrawn the appeal, the R2 should actively intervened that the calling of those expert reports were a mistake.

27.Although Mr Lee pointed out that the mere fact that the 2^nd Respondent’s solicitors asked the Applicant to provide a quantification of his claim and clarify whether he would adopt the Paper Mills formula is only customary practice, by virtue of the A’s solicitors’ reply on 7 May 2026, it was obvious that the A would still be pursuing the appeal whereby the R2 made no response.

28.I also note that the Amended Application made pursuant to the Order made by Her Honour Judge Phillis Loh dated 15 May 2026, the relief and Order sought by the A for appeal against the assessment of the Employee’ Compensation (Ordinary Assessment) Board in the Certificate of Review of Assessment (Form 9) dated 28 July 2023 pursuant to Section 18 of the Ordinance has not been amended and/or taken away.

29.It is my finding that the A has not withdrawn his appeal.

30.In the light of my finding, I would not deal with other points raised by Mr Ho and Mr Lee namely, the Pleading points and the purpose of the witness statement.

Costs

31.In Wo Chun Wah v Employees Compensation Assistance Fund Board (2019) 22 HKCFAR 495, Rebeiro PJ stated:

“45. The Board’s role was properly recognised by the trial judge:

“In participating in the proceedings, the Board’s function is neither to contest the employee’s claim in place of the employer nor to help save public funds, but is to ensure that employees in need can obtain such damages as they are entitled to. The Board has a duty to screen out unmeritorious or inappropriate claims to ensure (inter alia) that this assistance mechanism will not be abused, its recipients will not exaggerate their claims, and public funds will not be used for improper purposes. Therefore, unless it is necessary to contest false claims or suspected fraudulent claims, the Board should not adopt an antagonistic attitude in the proceedings. It should act as a filter and adopt an impartial attitude in the proceedings so as to assist the court in coming to a correct ruling.”

46. In my view, such recognition dictates that where the Board has been joined as a party and properly carries out its “filtering” or monitoring functions, the appropriate starting-point should generally be no order as to costs, irrespective of whether the Board sought to test the case as to liability, quantum or both.

47. That is the starting-point and a different costs order might be warranted on particular facts. One naturally expects that, having intervened, the Board will behave in a responsible manner but if, in what will hopefully be a rare case, its conduct is unreasonable or misconceived or unjustifiably antagonistic, unnecessarily prolonging its intervention, or otherwise untoward, the court may, in the exercise of its discretion, consider ordering the Board to pay the plaintiff’s costs. Factors such as those referred to in RHC Order 62 rule 5(2) set out above would be relevant. Where such considerations may arise, ECAO section 29 offers are especially relevant and will be taken into account. It must, however, always be kept in mind that the discretion to order costs is broad and to be flexibly exercised in the light of the specific circumstances.”

32.Mr Ho also submitted the following case:-

“3. Furthermore, the Court of Appeal in Fong Chak Kwan v Ascentic Limited & Ors [2021] HKCA 1138 (at para 76, p.47) reiterated that the Board is "not an ordinary hostile litigant with unlimited funds to litigate and with its own self interest to protect and advance". As the keeper of public funds, its statutory role is to prevent abuse seeking unmeritorious claims for compensation from the fund, "but not to put unnecessary obstacles in the applicant's rightful pursuit for damages". When the Board pursues misconceived legal arguments that stray beyond its proper role under its statutory role, it acts inappropriately and may attract costs sanction made against it (at para 74 and at pp.47 and 48).”

33.Mr Ho submitted that despite numerous opportunities given, the R2 did not make their point that the A has withdrawn his s18 appeal in clear, certain and unambiguous terms. It was only when the Mr Lee submitted his written Opening Submission 7 days before the hearing that this point was raised.

34.Mr Ho submitted that:

“(1) The First Opportunity (March 2026): On 27/3/2026, the Board’s solicitors (PC Woo & Co.) wrote to ONC Lawyers asking whether the Applicant would adopt the Hong Kong Paper Mills Formula. The Board raised no point of objection basing on the alleged ‘withdrawal of appeal’ on the Applicant's part at all.

(2) The Second Opportunity (7 May 2026): On 7/5/2026, the Applicant’s solicitors clearly replied that they would rely on the Hong Kong Paper Mills Formula, demonstrating a clear and unambiguous stance that the section 18 appeal was active. The Board again raised no objection.

(3) The Third Opportunity (hearing before HHJ Phillis Loh on 15/5/2026) The Board subsequently took out a summons to join in these proceedings and attended the direction hearing on 15 May 2026. Prior to that hearing, the Board was provided with the Applicant’s proposed directions seeking a 2-day trial specifically to deal with the section 18 appeal. The Board chose to remain silent regarding its stance on their contention of the Applicant’s alleged withdrawal of appeal at the 15 May 2026 hearing, failing to alert the Court or request leave to file an Answer pleading this material point which would essentially be challenging the section 18 appeal is no longer maintainable.

(4) Crucially, the Board’s such silence persisted even when directly confronted with the Applicant's pre-trial documents. In fact, on 13 May 2026, the Board’s solicitors requested an advance copy of the Applicant’s Appendix D, which was duly provided the following day. Within that document (specifically at paragraph 17) the Applicant explicitly confirmed that the section 18 appeal remained active. Predicated entirely on the continuation of this appeal, paragraphs 41 and 42 of the Appendix D, along with the accompanying proposed directions, clearly indicated that the case was ready to be set down for a 2-day trial. [See : Annex 1]”

35.Mr Ho also submitted that:

“13. The Board’s belated reliance on a single, inadvertent sentence in a witness statement (while conveniently ignoring the context as clearly revealed by the pre-trial correspondence which they have a full set of copy well before the direction hearing) goes far beyond its statutory "filtering" role. By adopting an unjustifiably antagonistic stance and unnecessarily prolonging the resolution of this matter, the Board’s conduct falls squarely within the exception to the starting position of “no order as to costs” as identified by Ribeiro PJ in Wo Chun Wah.

On the other hand, a “no order as to costs” ruling (if made) would unfairly penalize the Applicant to a very substantial extent, forcing him to bear upon himself the costs of preparing for a 2-day trial caused entirely by the Board's unreasonable litigation tactics.”

36.I agree. I fail to see why costs should not follow the event.

37.However, I would like to say something about the further submission prepared by Mr Ho.

38.The further written submissions were aimed to address this Court as to the impact of HHJ Phillis Loh’ recent decision in Li Kai Yin v Studiodanz Co Ltd (unrep, DCE 339/2024, 15/06/2026).

39.However, as Mr Lee rightly pointed out in his further written submission:

“2. As it turns out, not only is the case of Li Kai Yin simply irrelevant to the live issue in the present case, it is also clear that the Applicant has, under the pretext of addressing the “implication” of that case, completely failed to draw the Court’s attention to – and has flagrantly breached – the Court’s repeated deprecation of post-hearing submissions by impermissibly seeking to re-argue the entirety of the matter afresh (which, yet again, is devoid of merit). Such litigation conduct is wholly unbecoming of a party before this Court and must be firmly deprecated with adverse costs consequences (including costs to be taxed on an indemnity basis to mark the disapproval of the Court).”

40.I agree and because of that, I would only order the R2 to pay 80% of the A’s costs. I therefore make an order nisi that the R2 do pay the A’s 80% costs, with certificate for counsel, to be taxed if not agreed and such costs order nisi be made absolute if no application is made by any party to vary the same within 14 days. The A’s own costs to be taxed in accordance with Legal Aid Regulations.

41.Last but not least, it remains my gratitude for both Ms Ho and Mr Lee for their helpful assistance.

Mr Simon Ho, instructed by ONC Lawyers, for the Applicant

The 1^st Respondent was not represented and did not appear

Mr Jeffrey Lee, instructed by P C Woo & Co, for the 2^nd Respondent