Lam Hau Yee and Others v. Gloria Weaving and Kni

HCLA000035/1991

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

LABOUR TRIBUNAL APPEAL NO. 35 OF 1991

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Coram: Deputy Judge J. Chan in Court

Dates of Hearing: 2 & 10 October 1992

Date of Delivery of Judgment: 10 October 1992

Date of Handing Down Reasons: 20 November 1992

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J U D G M E N T

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1. This is an appeal by the Defendant against an award made by the learned Presiding Officer on 11th July 1991 for damages for loss of wages and breach of contract as well as severance payments. On 2nd March 1992 it obtained leave to appeal on the Re-amended Grounds of Appeal filed herein. After a two-day hearing the appeal was dismissed in its entirety with costs on 10th October 1992. Reasons for the decision have been reserved. I now hand down reasons for the dismissal of the appeal.

2. The six Claimants were piece-rated knitting workers in the hand-operated machine section of the Defendant's factory. They commenced their employments with the Defendant at various times between the 1960s and 1980s. Apart from the Claimants, there were only another piece-rated knitting worker and two daily-rated workers in that section of the factory. Sundays were rest days for the Claimants. On 4th September 1990, the Claimants (save the 2nd Claimant) were summoned to the factory and were told by the management that there would not be work for them to do at that point of time due to a lack of orders. It was suggested to them that they would be given a basic wage of $130 per day during this interim period if they would agree to learn to operate the semi-automatic machines in the semi-automatic machine section. The Claimants rejected the offer as they believed they were too old to start learning to operate different machines. The Claimants were not provided with work for the 4th and 5th September 1990. They were given work again on 6th September 1990. On 9th September 1990, a Sunday, a fire broke out in the factory. The factory occupied 6 floors of the building. The floor on which the Claimants' section was located was affected by the fire. They were told on 10th September that they would be notified later as to when they could resume work again. They went back to work as summoned on 24th September, a Monday. They were merely asked to clean the machines and change the rusty needles. Though they were not provided with any knitting work to do they noticed one of the two daily-rated workers of their section was doing knitting work. Thus, in the afternoon of the same day, the Claimants went to the Clothing Industry Workers General Union for advice on their rights for severance payments and other related matters. They were advised that they should continue work until 8th October which would be their next pay day to see if the Defendant would make compensation to them for not providing them with work for the period between 10th to 22nd September. They acted on such advice and resumed work on 25th September cleaning up the machines. 6th October, a Saturday, was their last working day prior to 8th October. On 8th October, the following Monday, they checked their bank accounts and found that no compensation was paid by the Defendant for not providing them with work for the period between 10th and 22nd September. Consequently, they ceased working for the Defendant as from 8th October, and served the requisite notice for severance payment under s. 31N of the Ordinance on the Defendant on the same day.

TERMINATION OF EMPLOYMENT

3. The learned Presiding Officer found as facts that the Claimants were not given work on 1st, 3rd, 4th, 5th, and from 10th to 22nd September. Neither were any of the Claimants paid for those days. As the livelihood of the Claimants depended on the provision of work, being piece-rated, such conduct of the Defendant would amount to a constructive dismissal (citing Marshall v. English Electric Co. Ltd. [1945] 1 AER 653 and Devonald v. Rosser & Sons [1906] 2 K. B. 728). However, he went on to find that whilst there should be an implied term that the Claimants were to be laid off without pay because of the fire, he was not satisfied that such implied term extended to the entire period from 10th to 22nd September. He further found as facts that after the fire various section of the factory resumed operation. He refused to accept the evidence of the Defendant's witnesses that 24th September was the earliest time when the Claimants could be provided with work. Consequently he found part of the period between 10th and 22nd September to be "unlawful" lay-offs. Furthermore, the learned Presiding Officer referred to s.11 (4) and held that the lay-off exceeded the limit permitted thereunder (i.e. it was more than a total of half of the total number of normal working days in any period of 4 consecutive weeks). After considering the respective sharp drops in the income of the Claimants over the material period, the learned Presiding Officer concluded that the Claimants were indeed constructively dismissed. In the premises, he held that the Claimants were entitled to and did terminate their employment without notice or payment in lieu under s.10 (c) of the Ordinance. And for the purposes of severance payment under Part VA of the Ordinance, he further held that the Claimants' termination of employment were to be taken as a dismissal by the Defendant pursuant to s.31D (1) (c).

4. As a result, the learned Presiding Officer awarded damages to the Claimants for loss of wages and wrongful dismissal, as well as severance payments based on both redundancy and lay-off.

5. The Defentant submits the learned Presiding Officer erred in that there was no constructive dismissal due to the frustrating event of the fire; or alternatively that the Claimants had, by resuming work between 24th September and 6th October, affirmed their contract of employment. In either case,the Defendant submits there would be no right for the Claimants to terminate the employment without notice or payment under s.10 (c) or to treat the same as a dismissal by the Defendant under s. 31D (1) (c). In the premises, it contends, the learned Presiding Officer ought not to have awarded any damages or severance payment.

FRUSTRATION

6. After referring to Davis Contractors Ltd v. Fareham Urban District Council [1956] A.C. 696 and Morgan v. Manser [1948] 1 KB 184, the learned Presiding Officer concluded that the fire and its consequential effects did not strike at the root of the employment contracts in that they did not render it impossible for work to be provided to the Claimants earlier than 24th September. Despite holding that there was an implied term for lay-off as a result of a fire, the learned Presiding Officer refused to accept the excuses put up by the defence witnesses and found part of the actual period of lay-off to be "unlawful". Though no complaint was made in the appeal of the fact that the learned Presiding Officer has failed to identify the precise period of "unlawful" lay-off; I noted that not only has he failed to do so, he in fact conceded later on in his reasons that he was unable to so ascertain from the evidence (pg.39 of the Resasons). However, the undisputed evidence is that out of the first 7 working days in September prior to the fire, work was only provided on 3 days. This fact, together with his finding that the Claimants could have been provided with work earlier than 24th September (though not being able to determine how much earlier) and that the Claimants' incomes had drastically dropped in September, as well as the fact that the Claimants' incomes further deteriorated after their resumption of work between 22nd September and 6th October; are sufficient to warrant his finding that the Defendant's conducts were of a sufficiently serious nature as to amount to constructive dismissal. The findings of facts by the learned Presiding Officer, which are binding on the Defendant and are beyond reproach by an appellate court pursuant to s. 35 (1) of the Labour Tribunal Ordinance, effectively stifled any plea of frustration as a result of the fire.

7. However, I would add that a plea of frustration is not open to the Defendant in view of the case it presented at trial. Mr Chiu Wai-hung, the supervisor of the Production Section of the Respondent said, when giving evidence for the Defendant, that the Claimants were laid off prior to the fire as a result of lack of orders and their refusal to be trained to operate semi-automatic machines (pg. 115 of the Appeal Bundle). And after the fire, on 20th/21st September, the Defendant decided to ask the Claimants to resume work. Thus it has never been the intention of the Defendant, and therefore could not have been their case, that they ever regarded themselves as being discharged from the employment contracts with the Claimants as a result of the fire. In fact all the workers in the various sections resumed work gradually after the fire. The Defendant has evidently always regarded the fire to have the effect of suspending the operation and the employments of their workers only rather than a discharge. And such a suspension or lay-off without pay cannot exceed the statutory limit, not even by agreement (see ss.11 (4) and 70), as the learned Presiding Officer has indeed held. Thus, the principle in Browning v. Crumlin Valley Collieries Ltd [1926] 1 KB 522 that the contract of employment should contain an implied term that the mineowners should not be liable to pay wages or damages to their workmen during the time which was reasonably required to put the mine into a safe condition, can only apply to Hong Kong subject to the provisions of sections 11 (4) and 70 of the Ordinance. So would express agreements for lay-off.

8. As against the claim for severance payment, the learned Presiding Officer further held that the doctrine of frustration, even if applicable to discharge the employment contract, is of no assistance to the Defendant. He held that pursuant to s. 31 L (1) when the employment contracts were terminated by operation of law, such termination shall be treated as a termination of contract by the Defendant. His interpretation of s. 31L (1) is clearly supported by Fenerty v. British Airports Authority [1976] 11 I. T. R. 1. And by virtue of s. 31L (2), the Claimants shall be taken to be dismissed by reason of redundancy. The Defendant then contends in its Re-amended Grounds of Appeal that the learned Presiding Officer erred in failing to find that the Claimants were re-engaged after the fire, and thus failed to give effect to s. 31D (2). I see no merits at all in such criticism.

9. Section 31L (1) (b) provides that where in accordance with any rule of law, any event affecting an employer operates so as to terminate a contract under which an employee is employed by him, that event shall for the purposes of Part VA be treated as a termination of the contract by the employer, if apart from that subsection it would not constitute a termination of contract by him. Section 31L (2), read in conjunction with s. 31D (2) and s. 31B (2) (c), provides that in a situation under s. 31 L (1) (b) and the employee's contract is not renewed and he is not re-engaged immediately on the ending of his employment under the previous contract, he shall be taken to be dismissed by reason of redundancy if the circumstances in which the contract is not renewed and he is not re-engaged are wholly or mainly attributable to, inter alia, a deminution of the requirements of that business for him to carry out work of a particular kind in the place where he was so employed.

10. There can be no doubt that the alleged frustration would have been an event affecting the Defendant which operates to terminate the employment contracts of the Claimants and thus by virtue of s. 31L(1) (b) be taken to be a termination by the Defendant. The fire that allegedly gave rise to the termination of the employment contracts by frustration occurred on 9th September. The Defendant only decided to recall the Claimants to work on 20th/21st September. Thus if there has been any renewal of contract, or re-engagement of the Claimants, it did not occur immediately on the ending of the previous contract on 9th September as required by sections 31L (2) and 31D (2). Further, the learned Presiding Officer found as a fact that the requirement of work for the Claimants had diminished and concluded that the Defendant had failed to rebut the presumption of redundancy.

11. I note in passing that the above statutory provisions apply only to the employer's situation. There is no provision catering for events affecting an employee. Thus frustration by virtue of events like imprisonment of the employee, or more innocent events like illness (which is outside s. 10 (aa)) or national service would have discharged the contract leaving the employee with no claim at all; not even for long service payments which required a dismissal or particular types of termination as provided in s.10 (aa) and s. 31R (1) (b).

12. The Defendant further contends that for the Claimants to be entitled to severance payments for a lay-off under s. 31B (2), they must first establish that they were constructively dismissed by the Respondents. Thus, they say, the alleged frustration would also defeat any claim based on a lay-off as it would have discharged the contract by operation of law preventing any constructive dismissal from arising. For reasons given supra, such contention also fails. But I am also of the view that their contention cannot be sustained in law at all, as a claim for severance payment on the basis of a lay-off does not require the contract of employment to be terminated first, or at all.

13. Mr Hung for the Defendant asked me to compare s.6 of the Redundancy Payments Act 1965 with the scheme of Lay-off in the local Ordinance. He submitted, quite rightly, that the Ordinance was modelled on the 1965 Act. He said as the 1965 Act required the contract of employment to be terminated by the employee by a notice of termination, our legislature must have intended such a requirement as well, though no express provision has been made. Section 6 of the 1965 Act, which has become s. 88 of the Employment Protection (Consolidation) Act 1978 does provide that no redundancy payment would become payable if the employee does not terminate his employment contract by notice within the various periods allowed. The Acts provide a rather complicated scheme with elaborate procedures for a claim based on lay-off or short time. The relevant part of the scheme for our purpose provides that the employee must first serve a notice of intention to claim for redundancy payment within a prescribed time. This notice has been described as a " conditional resignation". Thereafter, the employee must terminate his employment contract by a further notice of termination. This to enable the employee "to see whether his claim to payment will be disputed before taking the drastic steps of resigning, for the employer may serve, within seven days of the employee's communication, a counter notice that he will contest liability to payment (see Bowers on Employment Law, 2nd ed., pg.64).

14. Thus, upon a comparison, it is clear that not only would a lay-off not involve the concept of termination of employment contract, by definition it is founded on the assumption that the contract has not been terminated, and requires a further notice of termination to terminate it. This fundamental concept has clearly been transplanted into our local legislation intact. Section 31B (1) (a) and (b) draw a distinction between "dismissal by reason of redundancy" and "laid off within the meaning of s. 31E". Section 31E (2) provides that the continuity of contract shall not be treated as broken in a lay-off when no severance payment has been made. The "relevant date" was defined in s.31E (3) with reference to the expiration of the 4 or 26 weeks and not to the termination of employment. In England, if an employee is dismissed after he has served his notice of intention to claim redundancy payment, he would not be entitled to rely on the lay-off and could only resort to dismissal by reason of redundancy (s.88 (2) (b) of the 1978 Act).

15. In the absence of any express statutory provisions as in the English Acts, termination of the employment contract is not a requirement for a claim based on a lay-off in Hong Kong. Thus it is possible, at least in theory if not in reality, for an employee to obtain severance payment for a lay-off and yet continued to be an employee of his employer if he does not take separate action to terminate the employment for constructive dismissal. If the employer wishes to terminate his employment after paying him severance payment, he would have to give notice or make payment in lieu. In reality it is difficult to envisage any employee who would not also claim for constructive dismissal if the lay-off is an actionable one for severance payment. Thus, the conceptual difficulty arising from the failure to enact for a notice of termination as in the English system may be more academic than real, save perhaps when the defence of affirmation is raised.

AFFIRMATION/WAIVER/ESTOPPEL

16. The Defendant submits that upon the resumption of work by the Claimants on 24th September, which continued until 6th October, the Claimants had affirmed the contracts of employment and/or had waived their statutory rights and/or are estopped from claiming against the Defendant for the failure to provide work prior to 22nd September.

17. Heavy reliance is placed by Mr Hung on Exhibit C-7 to conclude that 22nd September was a pay day. He said as 22nd September was a pay day, and the Claimants were not paid any compensation for the days without work prior to that, they ought to be aware, on that day, of their entitlements in law to claim a constructive dismissal and severance payments. He said in failing to enforce their rights and by resuming work with such knowledge they must be taken to have affirmed their contract, or alternatively to have waived the wrong and/or are estopped from alleging otherwise. Exhibit C-7 is a list prepared, either by or on behalf of, the Claimants setting out detailed particulars of their wages for the 12 months prior to 20th October 1990. It took the form of putting amounts of wages against various dates. One entry giving various amounts of wages of the Claimants was made against the date 22nd September 1990. That forms the basis of Mr Hung's contention that 22nd September was a pay day. The learned Presiding Officer did not make any finding one way or the other in respect of the significance of that piece of evidence. Upon further perusal of the exhibits, I am sure Mr Hung is right. The passbooks produced by the 3rd and 6th Claimants (Ex. C-14 and C-16 respectively) as well as the work and wages records produced by the Defendant all confirmed that wages were paid into their savings accounts every fortnight. The material entries are 11th August, 24th August, 8th September, 22nd September and 6th October. The 1st and 2nd Claimants confirmed in evidence 22nd September was a pay day (pages 31 and 40 of Appeal Bundle). I am satisfied and do draw the inference that wages were paid every fortnight, and 22nd September was a pay day.

18. The short summary of law given by Lord Denning in Western Excavating (E.C.C.) Ltd v. Sharp [1978] I.C.R. 221 at p.226 that the employee "must make up his mind soon after the conduct of which he complains: for, if he continues for any length of time without leaving, he will lose his right to treat himself as discharged" must be read in the light of subsequent cases when it was examined by the Employment Appeal Tribunal. Browne-Wilkinson J. said in W.E. Cox Toner Ltd v. Crook [1981] I.C.R. 823 at p.829 that:-

"(It) is not, and was not intended to be, a comprehensive statement of the whole law. As it seem to us, Lord Denning M.R. was referring to an obvious difference between a contract of employment and most other contracts. An employee faced with a repudiation by his employer is in a very difficult position. If he goes to work the next day, he will himself be doing an act which, in one sense, is only consistent with the continued existence of the contract, i.e. he might be said to be affirming the contract. Certainly, when he accepts his next pay packet (i.e. further performance of the contract by the guilty party) the risk of being held to affirm the contract is very great: see Saunders v. Paladin Coachworks Ltd (1967) 3 I.T.R. 51. Therefore, if the ordinary principles of contract law were to apply to a contract of employment, delay might be very serious, not in its own right but because any delay normally involves further performance of the contract by both parties. It is not the delay which may be fatal but what happens during the period of the delay: see Bashir v. Brillo Manufacturing Co. (1979) I.R.L.R. 295.

Although we were not refered to the case, we think the remarks of Lord Denning M.R. in the Western Excavating case are a reflection of the earlier decision of the Court of Appeal in Marriott v. Oxford and District Co-operative Society Ltd (No.2) [1970] 1 Q.B. 186. In that case, the employer repudiated the contract by seeking to change the status of the employee and to reduce his wages. The employee protested at this conduct but continued to work and receive payment at the reduced rate of pay for a further month, during which he was looking for other employment. The Court of Appeal (of which Lord Denning M.R. was a member) held that he had not thereby lost his right to claim that he was dismissed. In the Western Excavating case Lord Denning M.R. explains, at p.227, that the case would now be treated as one of constructive dismissal. This decision to our mind establishes that, provided the employee makes clear his objection to what is being done, he is not to be taken to have affirmed the contract by continuing to work and draw pay for a limited period of time, even if his purpose is merely to enable him to find another job."

19. The learned Presiding Officer had not considered the defence of affirmation which was only raised by the Defendant for the first time in the appeal. The evidence on this issue is clear and unequivocal. The 1st Claimant said in cross-examination that "the other reason for not continuing to work was that the company did not constantly give us work to do and the prices of the work provided were not satisfactory. The main reason is that the prices for working on the relieving-the-poor garments were too low... We could not make a living." The undisputed evidence is that the Claimants were paid $16 a garment prior to September. After their refusal to undergo training for semi-automatic machines when there was no work for them to do, they were given work under Order No. 5272 i.e. "the relieving-the-poor garments" (pg.32 of Appeal Bundle). However, they were only paid $9.00 per garment for the order. The Claimants asked for a price of $12.00 per garment but the Defendant were only agreeable to increase it to $9.90 after 26th or 27th September. At that time the Claimants asked the Defendant if they could refuse to do any work on the said order. The Defendant's position was that if they do that they would be regarded as taking personal leave off their work, and it could not be attributable to their dissatisfaction of the price for the said order (pg. 25 of Appeal Bundle). Most of the other Claimants agreed with the above testimony of the 1st Claimant. The 2nd Claimant further added "the other reason I left the company, apart from not paying compensation for the period of lay-off, is that there was not sufficient work to do. Furthermore, I had the feeling that the company did not regard our department as importment. The prices of things given to us were low, and it seems that it was trying to force our department to vanish." His sentiment and suspicion of the motive of the Defendant can, in fact, be supported by evidence from the defence witnesses. According to those witnesses, when the Defendant gave Order No. 5272 to the Claimants to do at $9.90 per garment it was also subcontracting the same work to subcontractors at the price of $13.00 per garment. When asked by the representative of the Claimants why did the Defendant not ask the Claimants to do overtime on 29th September, a Saturday, at the lower price instead of subcontracting the work out at a higher price, the personnel officer of the Defendant said "because they were not willing to do the work. They were of the opinion that the prices were low."

20. Upon a careful scrutiny of the evidence on this issue, I am satisfied that the Claimants were only given Order No. 5272 to work on for the 3 days prior to the fire and were working exclusively on the same order for the whole period between resumption of work on 24th September and the last day of work on 6th October. They were not satisfied with the low rate of wages given and were working reluctantly and under protest. The Defendant was fully aware of their sentiments. In fact the incomes of the Claimants were drastically reduced for the period they worked on this order. The total time they worked on this order only added up to slightly over a fortnight. It is reasonable to infer that it was only after working on the order for a more substantial period i.e. 9 days after the fire that they realised the devastating effect of the order on their incomes when they saw the amounts credited to their savings accounts on 8th October. This inference is totally consistent with their evidence of the reasons for refusing to return to work. In the premises, even if one only looks at the period after 24th September there would have been sufficient ground for holding that a constructive dismissal has been established. It has been held in Bashir v. Brillo Manufacturing Co., supra, that by refusing to allow the employee to continue as a supervisor and instead offering him a job with less pay and status, the employers were guilty of constructive dismissal. Likewise, the drastic drop in the Claimants' incomes forced on them by the Defendant offering work only at a much lower rate amounted to a constructive dismissal. The Claimants were working under protest which was known to the Defendant and thus could not be taken to have affirmed the contracts.

21. Furthermore, the learned Presiding Officer found as a fact that the reason why the Claimants resumed work after 24th September, and continued to work until the next pay day, was because they were advised by their trade union that they must do so before they could find out if they could claim severance payments. The advice was based on the fact that under s. 31E an employer can but his way out of a lay-off by paying wages to the employees for the days for which no work was provided in such a way that the days for which neither work nor wages were given would not exceed the statutory limit. They were given to understand that they could only lodge a claim for severance payment if the Defendant has not done that on 8th October, the next pay day. This probably was inappropriate advice with hindsight as according to the learned Presiding Officer's findings of facts, the period of lay-off between 26th August and 22nd September would have entitled them to such a claim already. But it is not known if the advice was given with full knowledge of the situation before the fire on 9th September. Thus, on the said findings, the Claimants were not aware of their proper legal rights when they resumed work after 24th September.

22. The Court of Appeal held in Peyman v. Lanjani [1985] 1 Ch.457 that in order to render an innocent party's election to affirm a contract irrevocable, he had to have knowledge not only of the facts which give rise to the election but also of the right of election itself; that a person could not be treated as having elected to affirm a contract unless he had unequivocally demonstarated to the other party that he intended to proceed with it; that the issue of election was a question of fact to be decided on the evidence. In Leathley v. John Fowler & Co Ltd [1946] K.B. 579 the Court of Appeal in applying the majority decision of the House of Lords in Young v. Bristol Aeroplane Co. Ltd. [1946] A.C. 163, held that a workman, who accepted payments of compensation in ignorance of his statutory option to claim damages from his employers at common law, was not barred from making that claim. Lord Atkin said in Evans v. Bartlam [1937] A.C. 473 at p.479, in the House of Lords, that:-

"Nor do I find it possible to apply the doctrine of election. It is a simple answer to say that to infer election it must be shown that the person concerned had full knowledge of the various rights amongst which he elects (emphasis provided). There is here no evidence that the defendant at the time he asked for and received time had any knowledge of his right to apply to set the judgment aside (emphasis provided). I cannot think that there is any presumption that he knew of this remedy either sufficiently for the purpose of the doctrine as to election or at all. For my part I am not prepared to accept the view that there is in law any presumption that any one, even a judge, knows all the rules and orders of the Supreme Court. The fact is that there is not and never has been a presumption that every one knows the law. There is the rule that ignorance of the law does not excuse, a maxim of very different scope and application."

Lord Wright in the same case said, at p.485, that:-

"Election is a question of fact. I can find no facts here to show that the elements of election such as intention or knowledge of his legal rights (emphasis provided) were present."

23. I respectfully adopt the comment of Lord Wright in the present case. The express findings of the learned Presiding Officer are clearly against the existence of any intent or knowledge of the requisite legal rights to give rise to any election or affirmation on the part of the Claimants.

24. I would also add that as the termination of the employment contracts is not a prerequisite for a lay-off under s. 31E, any affirmation of the contracts by the Claimants that may arise from their resumption of work after 24th September would have no legal effect on their claim under s. 31B (1) (b).

25. There can also be no question of any waiver or estoppel arising in this case. The Claimants resumed work as requested by the Defendant. The defence evidence is that at that time the Defendant had difficulty in recruiting workers after the Claimants left. Thus by returning to work the Defendant benefited from their act rather than acted to its detriment in reliance thereon.

26. I would further add that I cannot agree that there can be waiver of any legal rights, or any room for estoppel to apply, in our s. 31E. The statutory provision enables the employee to rely on "any period of " 4 or 26 consecutive weeks. Every Sunday will be the beginning of a new period under s. 31E. And the continuity of the contract is presumed if no severance pay is made. The Ordinance presupposes the continuation of the contract and allows a claim to be made within 3 months from the expiry of the period of time in question. In the circumstances, it is difficult to envisage anything short of an express unequivocal statement of waiver of the statutory right will suffice. Mere continuance of work by an employee without more can hardly give rise to waiver or estoppel.

27. I would reserve my position on the learned Presiding Officer's obiter made in reliance on the following general comment of the learned judge in Fashion Art Garment Factory Ltd. v. Yeung Man Ching L.T.A. No 39/89 at p.4:-

"But the right to severance payment under section 31E and section 31W is a statutory one. It is a right created by an Ordinance. Its nature and attribute, scope and subsistence are set and regulated by the provisions of the Employment Ordinance. I am not persuaded that a statutory right such as this can be overridden or prejudiced by the general principles in the law of contract."

28. The learned Presiding Officer concluded that that entitles him to find "frustration has no application in the ambit of severance payment". I would reserve my position at least insofar as it relates to redundancy. I do not propose to comment any further on this as it does not arise for my determination in this appeal.

Dated this 24th October 1992.

Representation:

Mr. Andy Hung, instructed by M/s. Lo & Lo, for the Appellant/Defendant.

Mr. Louis Chan, instructed by M/s. Liu, Chan & Lam, for the Respondents/Claimants.