Lai Hing v. J. Cater and Another

HCA000512/1976

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

ACTION NO. 512 OF 1976

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Coram: Cons, J.

Date of Judgment: 7th December, 1976.

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JUDGMENT

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1. Mr. Lai Hing is a private citizen who runs a firm of electrical engineering and supplies. He carries on his business on the ground floor of premises in Wan Chai. He and his family have their home on the first floor above the shop. Early one morning in January this year three officers from the Independent Commission Against Corruption called at his address with a search warrant. It entitled them to search the ground floor. They did so. In addition they searched the first floor Mr. Lai claims that they did so without his permission. If that is so, the officers were in the wrong and would be guilty of trespass. Mr. Lai also claims that the officers took him back with them to their headquarters and there detained him against his will for over two hours. If that is correct the officers were again in the wrong. This time they would be guilty of false imprisonment. On the same day the officers took three deposit receipts from a safe deposit box kept by Mr. Lai at his bank. That was quite lawful. The officers had an appropriate warrant. But Mr. Lai claims that they should have returned the receipts within a few days. In fact the officers did not do so until several months later and then only after court proceedings had been taken against them. The receipts represented a large sum of money the use of which was denied to Mr. Lai for that period. If Mr. Lai is correct in his contentions he will be entitled to recover damages. That is why he has brought the present action.

2. The writ, and the statement of claim which has now been issued, are directed against, firstly, Mr. Cater, who is the Commissioner and head of the Independent Commission Against Corruption, and, secondly, against the Attorney General, as representative of the Crown. At the moment Mr. Cater stands sued on his own behalf as well as in a representative capacity on behalf of his deputy and the other officers of the Commission. However, it is conceded that the circumstances are not appropriate for a representative action and that matter will in any event be rectified.

3. This proceeding is an application by Mr. Cater that be ceases to be a party to the action. Let me say at once that it is not an attempt by Government - and I use that word loosely - to stifle the action. The Attorney General has entered an appearance and in due course the issues will be fought out upon evidence and argument in the usual way whether Mr. Cater remains personally a party or not. That is one reason why Mr. Lai's counsel takes objection to the present application. He says that the removal of Mr. Cater's name would not affect the substantial issues between the parties. In a sense that may be correct. I can not foresee that the evidence to be called would be very different. But there would be a great change for Mr. Cater himself. There is a world of difference between being a party to an action and merely having a professional interest in the outcome of that same action. Being a party imposes the possibility of liability in many ways. Mr. Cater is entitled to have that possibility removed if that is the proper order.

4. Then it is said that now is not the appropriate time to consider the question, that it should wait until the actual trial when account can be taken of the evidence that will be adduced. This argument is strictly directed to the second part of Mr. Cater's application, that is, that the statement of claim should be struck out or at least that all references to Mr. Cater therein should be removed. The practice in this respect is well settled. A statement of claim should not be struck out unless in is plain and obvious that it cannot succeed; and it is not considered plain and obvious where "questions of general importance or serious questions of law" are concerned. The question I have to answer would probably fall in that class. However I think it is a mistake to consider the present position from this angle. It is not a situation where a defendant alleges that a plaintiff has no possible complaint. That is a situation to consider striking out the claim. Here it is conceded that a plaintiff has a possible complaint. The question is whether Mr. Cater is a correct person to be sued. I see no reason why it should not be dealt with now.

5. The claim against Mr. Cater is based on his liability for acts committed not by himself but by officers of the Commission, that is by officers who must have been appointed by him and who assist him in the performance of his duties (section 8, Cap. 204). An employer is at law normally responsible for the acts of those whom he employs provided that the acts form part of their duties. That is so nowadays even where the employer is the Crown. But no senior Crown servant is as such responsible for the acts of his subordinates. This has long been established. I need quote no authority. If Mr. Cater is a Crown servant then he is not liable for the acts of his subordinate officers and is entitled to be released from this action. That raises the initial question to be decided. Is Mr. Cater a Crown servant or not? It is said to be a mixed question of fact and law but with respect I cannot see that it is. It seems to me a question of pure law. No particular fact or kind of evidence was suggested which might be called to vary the Commissioner's position. He is appointed under the Independent Commission Against Corruption Ordinance (Cap. 204). His duties and powers are set out therein. There is no need to go beyond the Ordinance to see what is his position.

6. The question whether a person carrying out duties for the benefit of another is or is not that other's servant turns on the extent of control retained or exercised by that other. If full control is retained the contract is clearly one of service. At the other extreme if a person is merely instructed to achieve a particular result and the manner of doing so is left completely to his own discretion then undoubtedly he is what is usually known as an "independent contractor". It is not always an easy distinction to make. Particular instances frequently present very difficult questions of degree. In the present case there is a lot to be said for Mr. Cater's independence. It starts with the very title of the Commission that he commands. Then he has complete discretion as to whom he will employ in that Commission; and he may terminate at any time and without assigning reason the services of those that he has employed (section 8, Cap. 204). The Governor has indeed been given some measure of control over recruitment but as I read the Ordinance that control relates to the overall number of officers to be employed and their general conditions of service rather than to their individual personalities. The Commissioner is responsible for the direction and administration of the Commission subject only to the orders and control of the Governor (section 5(1)). This was said by the Colonial Secretary in introducing the second reading of the bill to "clearly demonstrate the complete independence of the Commissioner" (Hong Kong Hansard 1973/74 p.401). In case that were not enough the next subsection of the Ordinance expressly provides that the Commissioner shall not be subject to the direction and control of any person other than the Governor.

7. In England and elsewhere there are statutory corporations in very much the same position as the Commissioner when it comes to independence. These are not usually treated as Crown servants. The Attorney General concedes this in the well-known case of Conway v. Rimmer⁽¹⁾. An earlier case concerned the British Transport Commission: Tamlin v. Hannaford⁽²⁾. That Commission was apparently subject to the control of the Minister of Transport, but the Court of Appeal had no hesitation in saying that there was ample authority that the Commission did not thereby become a Crown servant (p.25). It was attempted to distinguish these cases by pointing out that they all related to corporations. I do not think there is any validity in this distinction. The Commissioner as a person is as much a legal entity as any of them. Perhaps it is better to put it the other way round. In law they are as much a person as he is.

8. But the matter does not rest there. When it is a matter that concerns the interests of the Crown it is necessary also to look at the nature of the action that is to be performed. Most of the functions exercised by the big statutory corporations in the United Kingdom were previously undertaken by commercial enterprises. The assumption of responsibility by the Government did not stem from long established prerogative rights. It was the culmination of comparatively recent social tendencies. There are however certain functions which Crowns and Governments have exercised as a matter of right from time immemorial. Lord Watson in Coomber v. The Justices of the County of Berks⁽³⁾ described them as "the primary and inalienable functions of a constitutional Government". These functions inherently assume the mantle of the Crown and to my mind any person who exercises them on a regular or routine basis ipso facto does so in the service of the Crown. He may, as does a judge or magistrate, have complete independence in the performance of his duties. But that does not alter then nature. They are still the duties of the Crown. Lord Watson included in the number of ...(illegible) functions "the maintenance of order and the repression of crime". Corruption is one particular form of crime. The Commissioner is charged with repressing it. It follows that in so doing he is a Crown servant. This is confirmed by section 12 of the Ordinance which sets out the duties of the Commissioner "on behalf of the Governor".

9. For these reasons I accede to the first part of the application and order that Mr. Cater cease to be a party to this action. It is not necessary then to deal with the question of his liability if he were not a Crown servant or with the second part of the application. The writ and statement of claim will have to be amended in any case.

Representation:

Henry Litton, Q.C., and Andrew Li (Edmund Cheung & Co.) for the plaintiff.

G.F. Fuller, Crown Counsel, for the 1st and 2nd defendants.

(1) [1968] A.C. 910 at 941

(2) [1950] 1 K.B. 18

(3) [1883] 9 A.C. 61 at 74