Jobe Ebou and Another v. Muse Produciton Ltd
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HCLA 15/2010 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE LABOUR TRIBUNAL APPEAL NO. 15 OF 2010 (ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO. 197 OF 2010) ____________ BETWEEN
____________ Before: Deputy High Court Judge Pow, SC in Court Date of Hearing: 3 March 2011 Date of Judgment: 11 March 2011 _______________ J U D G M E N T _______________ 1.This is an appeal from the decision of the Presiding Officer of the Labour Tribunal dated 16th July 2010 dismissing all claims made by the 1st Claimant, the Appellant herein. On 19th August 2010, the 1st Claimant sought to review the Presiding Officer’s decision. The application for review was equally dismissed by the Presiding Officer. The decision of the Presiding Officer resulted in an award/order made on 26th day of July 2010 and filed on 25th August 2010 (“the LT Order”). 2.In LBTC 197 of 2010 (“the LT Claim”), which was instigated on 14th January 2010, the 1st Claimant claimed for:-
3.The 1st Claimant was granted leave by Mr. Justice To on 15th November 2010 to appeal against the LT Order upon the following grounds:
Backgrounds 4.The 1st Claimant was employed by the Defendant as a bass player in musical performances at the “City of Dreams” (“COD”), a casino in Macau. The name of his band was “The Company”. The 1st Claimant’s employment was embodied in a written Contract of Employment (“the Contract”) dated 19th June 2009. The following are the relevant terms of the Contract:-
5.Schedule B of the Contract contained the following terms:-
6.At the end of July 2009, Mr. Lau Chun Kong (“Lau”), the Defendant’s director at the material time, informed the 1st Claimant that the Saturday shows in August would be cut and that the 1st Claimant would no longer be required to perform on Saturdays, starting from the month of August. 7.The 1st Claimant testified at the trial but called no other witness. In relation to his claims for arrears of wages, his evidence was that all the shows as stated in Schedule B should have been provided to him by the Defendant. The event period in Schedule B referred to every Friday, Saturday and Sunday starting from 19th June 2009 to 31st August 2009. He contended that the Defendant was in breach of the Contract in failing to provide to him the August Saturday shows (a total of 5 shows) for which he should be able to earn a total of HK$12,500. 8.The 1st Claimant vehemently denied allegations made by the Defendant in respect of “performance at stage”, such as the failure to play with correct key and failure to play sufficient new Chinese songs to the audience. The 1st Claimant said that the Defendant’s allegations were totally unfounded. He said that the genuine reason behind the cutting of the Saturday shows in August was because the Defendant wanted to save money. 9.The 1st Claimant contended that the word “amend” in clause 8.2 of the Contract did not mean that the Defendant could cancel shows. He argued that the Defendant was only entitled to change the date of the performance but not to cancel it. He referred to an email dated 25th July 2009 from Lau which was in these terms:-
Immediately after receipt of the above email, the 1st Claimant protested to Lau through an email dated 27th July 2009. In this email, the 1st Claimant requested for payment of August Saturday show fees. The 1st Claimant said that Lau did nothing about it and eventually, he was not given any Saturday shows in August. The 1st Claimant however confirmed that he had received a sum of HK$2,500 from the Defendant in respect of one August Saturday when there was no performance at all on that Saturday. He also said that after his last show on 30th August 2009, he did not make any further complaint to Lau for cancellation of the shows. He further said that he did not make such complaint to Lau when he collected the final payment from the Defendant on 30th September 2009. 10.The Defendant called 4 witnesses to testify and they were: (1) Lau; (2) Mr. Yeung Chi Wai (“Yeung”); (3) Miss Florence Lui (“Lui”) and (4) Mr. Lee Wai Davy (“Lee”). The Defendant carried on business as an agent arranging musical players for clients. COD was a client of the Defendant. 11.Lau said that in June 2009, COD posted a notice in the resting room of band players reminding all bands not to play the same songs repeatedly. In around July, COD informed Lau that “the Company” did not have sufficient Chinese songs to perform. 12.Lui was also a director of the Defendant. She said that she had all along monitored the performance of “the Company” through communications with the management of COD. In or about mid-June, she received a complaint from Miss Heidi Wong of COD (“Heidi”) that the 1st Claimant’s band did not have sufficient Chinese songs to perform at stage. Heidi warned that if the band showed no improvement, all shows in August 2009 would be cancelled. Lui said that she relayed COD’s position to the 1st Claimant and urged the band to improve. There was no improvement and in mid-July, Heidi informed Lui that COD decided to cut all shows of “the Company” starting in August 2009. Lui tried to dissuade Heidi and urged her to at least keep shows of “the Company” on Fridays and Sundays. Heidi eventually accepted Lui’s suggestion and cut only the Saturday shows of “the Company”. 13.Lau said that upon receiving the new schedule for August from COD, he immediately sent an email to the 1st Claimant informing him of the new arrangement in August. That was the 25th July 2009 email. By another email dated 27th July, Lau also sent to the 1st Claimant the new August schedule showing that “the Company” was only required to perform on Fridays and Sundays. Lau acknowledged receiving the 1st Claimant’s protesting email which was also dated 27th July. From the time records in the 2 emails both dated 27th July, it seems that Lau received the 1st Claimant’s protest before he sent his email bearing the new August schedule. Lau said he had explained to the 1st Claimant that the decision was made by COD’s management which was beyond the control of the Defendant. According to Lau, the 1st Claimant eventually accepted the new arrangement and from August onwards, he did not receive any further complaint from the 1st Claimant. In August, “the Company” merely performed on Fridays and Sundays. Eventually, when the 1st Claimant came up to the Defendant’s office to collect his final payment for the shows, the 1st Claimant did not make any complaint about the cancellation of shows and did not challenge the final amount of show fees due to and collected by him. Lau also exhibited the payment slip for the fees of the August shows bearing the signature of the 1st Claimant as receipt acknowledgment. Lau further explained that as the new arrangement for August was only conveyed to the 1st Claimant towards the end of July, the Defendant had paid him an extra sum of HK$2,500 as one August Saturday show for compensation. 14.In her Reasons for Decision, the Presiding Officer did not set out the evidence of the other two witnesses for the Defendant. From the witness statement of Yeung, he was, at the material time, a programme assistant working for the Defendant. He had since then left the Defendant. He confirmed that COD had on divers occasions complained about the quality of performance and professionalism of “the Company”. He spoke of his personal observation that the 1st Claimant was the worst amongst the ten odd musicians and gave detailed descriptions. He also confirmed that despite COD’s afore-mentioned posted notice, “the Company” was unable to provide sufficient new songs. As for Lee, his witness statement stated that he was, at the material time, a guitarist of another band which was also engaged by the Defendant to provide performance in COD. In August 2009, he was the substitute guitarist of “the Company”. He gave his observations on the lack of quality and professionalism on the part of the 1st Claimant. As for his evidence relating to his understanding of the contractual terms governing his contract with the Defendant, it is irrelevant to the present dispute. Construction of Contract by the Presiding Officer 15.The Presiding Officer first referred to clause 1.5 of the Contract and in particular, sub-clauses 1.5.1 to 1.5.3. She said that when clause 1.5 was construed as a whole, it was quite clear that the dates of performances as provided in Schedule B were “provisional” only and were not definitely promised by the Defendant. The Presiding Officer also relied on clause 8.2 of the Contract. She found that on a proper construction of the Contract, the Defendant had no obligation to provide all the shows as stated in Schedule B. She held that Schedule B should be construed as provisional schedule of performance only. 16.The Presiding Officer found all the defence witnesses to be credible witnesses and accepted their account of the events. She then made the following findings of fact based on all the evidence presented before her:-
The Appeal – Construction Grounds 17.Grounds 1 to 3 can and should be considered together as they relate to the proper construction of the parties’ rights in relation to show performances as set out in Schedule B to the Contract. 18.With respect to the Presiding Officer, her approach to the matter caused me immediate concern. If she were right in her construction of the Contract, in that the Defendant had no obligation to provide all the shows as stated in Schedule B which should only be construed as a provisional schedule of performance, it is difficult to understand why she need to proceed to consider and make findings on whether the Defendant had a valid and reasonable reason to cancel the August Saturday shows of “the Company”. It would simply be in the Defendant’s straight contractual right to do so and the 1st Claimant would have no cause to complain. Neither would it be necessary for her to consider and make findings on whether the decision to cancel the August Saturday shows originated from COD instead of the Defendant’s own initiative. Similarly, the Presiding Officer need not enter into the factual issues of whether COD had justifiable reasons, on account of the quality and professionalism of the 1st Claimant’s performance, in coming to the decision of cancelling all Saturday shows in August. I understand that it was the 1st Claimant’s case that the Defendant cut the shows in order to save money. However, if the construction point as held by the Presiding Officer were correct, the motive behind the Defendant’s exercise of its contractual right would be irrelevant. 19.It is trite law that in seeking to construe an express term in a contract, the court shall have proper regard to the factual matrix surrounding the making of the contract [see Investors Compensation Scheme Ltd. v. West Bromwich Building Society [1998] 1 W.L.R. 896, at 912-913]. One of the most important factual matrix would be the nature of the contract in question. In my judgment, the following are important features of the Contract which should be borne in mind before one embarks upon the proper interpretation of the terms contained in the Contract:-
20.It is on the basis of the above factual matrix that I shall embark on the interpretation of various clauses in the Contract. Clause 1.3 set out the fee of HK$2,500 per formal performance. The period of the 1st Claimant’s employment was defined in clause 1.4 which could be extended by mutual agreement. Clause 1.5 described “Schedule B” as defining the dates of performances. Schedule B set out the days on which the 1st Claimant’s performance was required, and hence his opportunity to earn remuneration on those days. Clause 1.5.1 required the 1st Claimant to comply with the schedule provided in Schedule B. Clause 1.5.2 dealt with notification for intended changes to the schedule. In the way it was drafted, clause 1.5.2 contemplated changes at the initiative of the Defendant rather than the 1st Claimant. Clause 1.5.3 is important. It required changes to be first mutually agreed upon before they could become effective. Schedule B was no doubt mutually agreed upon at the time of execution of the Contract. Clause 1.8 again emphasized the importance of “mutual agreement” in respect of the performance schedule. The 1st sentence in clause 1.8: “The Performers shall at all time comply with the performance schedule as agreed” must refer to the schedule of performance as initially set out in Schedule B and perhaps subsequently amended through parties’ mutual agreement reached pursuant to clause 1.5.3. The remaining parts of clause 1.8 were effectively repetitions of clauses 1.5.2 and 1.5.3. In my judgment, the imposition of clause 1.8 reinforced the need for prior mutual agreement in respect of changes to the performance schedule initially set out in Schedule B. It would therefore seem that the Defendant cannot unilaterally alter the performance schedule, in particular by cancelling performances stipulated in Schedule B without compensating the 1st Claimant accordingly. 21.The Defendant however argued otherwise. It firstly relied on clause 8.2 which, in its literal interpretation, reserved the right to the Defendant to amend “the show content and schedule”. It even stated that in case of any dispute, the decision of the Defendant is final and conclusive. The Defendant further relied on 2 clauses set out in bullet points in Schedule B as set out in paragraph 5 above. In the first bullet point, it was stated that “each of the exact show time/rehearsal schedule within the time schedule is subject to the confirmation of the Company”. In my judgment, there is no difficulty in finding that it did not entitle the Defendant to alter the schedule unilaterally as contended. This bullet point merely dealt with “show time” and “rehearsal schedule” within an agreed performance schedule. As to the second bullet point, it simply dealt with the provision of “Weekly Schedule”. In my judgment, such weekly schedule was meant to refer to confirmed time-table as to show time and rehearsal arrangement as afore-mentioned in the first bullet point. It did not indicate in any sense that the Defendant was thereby entitled to unilaterally alter the performance schedule. Neither will the requirement to submit leave application 7 days in advance assist the Defendant in its contention. The Defendant was under no obligation to grant such leave application. Hence changes to the performance schedule, even if the Defendant were prepared to grant such leave, would remain consensual as stipulated in clauses 1.5 and 1.8. 22.More problematic is clause 8.2. The Defendant’s right to amend literally extended to “show content and schedule”. In my judgment, the right to amend under clause 8.2 was intended to apply only to those amendments that would not have the effect of prejudicing the 1st Claimant’s remunerative entitlement under the Contract. If this right to amend is interpreted to include a right to cancel performances stipulated in Schedule B when the performance schedule was first agreed (thereby adversely affecting the 1st Claimant’s remunerative entitlement), clause 8.2 will be repugnant to clauses 1.5 and 1.8 which repeatedly emphasized the need of the 1st Claimant’s agreement to proposed changes in the performance schedule. My interpretation involves drawing a distinction between the subject matters of clauses 1.5 and 1.8 on the one hand and that of clause 8.2 on the other. Such distinction is consistent with the fact that clause 8.2 specifically referred to “show content and schedule” rather than “the schedule provided in Schedule B” and “the performance schedule” as mentioned in clauses 1.5 and 1.8 respectively. In my judgment, clause 8.2 was intended to deal with amendments internal to a show, rather than whether there is to be a show at all. In other words, clause 8.2 did not entitle the Defendant to unilaterally cancel all August Saturday shows without the express agreement of the 1st Claimant. 23.In coming to the above conclusion, apart from placing the Contract in its proper factual matrix, I am assisted by the following cannons of construction:-
24.In my judgment, accordingly, the learned Presiding Officer erred in her construction of clauses 1.5 and 8.2. She erred in concluding that the performance schedule as set out in Schedule B to the Contract was merely provisional. She also erred in concluding that the Defendant had no obligation to provide all the shows as stated in Schedule B. Approach of the Presiding Officer 25.If the Presiding Officer had properly interpreted the Contract, the next proper inquiry would be on whether the 1st Claimant had agreed to the cancellation of all Saturday shows in August. The Presiding Officer found that the conduct of the 1st Claimant amounted to an acceptance of the new arrangement of the Defendant, either expressed or implicit. It is necessary to look at her findings as to the Defendant’s conduct at paragraph 30 of her Reasons for Decision:-
26.Again, with respect to the Presiding Officer, I cannot agree with her conclusion. If she had properly interpreted the Contract, she would actively look for evidence that the 1st Claimant actually “agreed” to the changes, which should be more than a mere helpless reaction to a situation forced upon him by the employer. When one looks at the evidence closely, I am satisfied that the 1st Claimant never agreed to the changes made by the Defendant. One should begin with the email dated 25th July 2009 whereby the Defendant informed the 1st Claimant of the cancellation of all Saturday shows in August (see Defendant’s exhibit D-3(7)(a)):-
27.To this email, the 1st Claimant immediately replied in protest by his email dated 27th July 2009 (also under Defendant’s exhibit D-3(7)(a)) as follows:-
It is thus clear that the 1st Claimant did not agree to the cancellation without compensation to him. 28.Then one looks at the email from the 1st Claimant to Lau dated 28th July 2009 which the Presiding Officer referred to:-
29.In light of the above emails from the 1st Claimant, I cannot infer that he had agreed to the changes forced upon him by the Defendant. The fact that the 1st Claimant continued to perform on Fridays and Sundays in August meant that the 1st Claimant did not accept the wrongful repudiation of the Contract by the Defendant. However, the 1st Claimant was entitled to elect to continue performing his part of the Contract and pursue the Defendant on damages for breach of warranty. The subsequent emails in August on hotel accommodation were consistent with such a stance. The lack of further protest or reiteration of his stance after his 2 emails up to the time the 1st Claimant collected his last remunerations on 30th September was neither here nor there. Suffice to say that it was at best unequivocal and is insufficient to support an inference that he positively agreed to the changes on no recourse basis. In any event, the 1st Claimant brought his claim at the Labour Tribunal in just 3½ months time on 14th January 2010. 30.In the circumstances, I equally find that the learned Presiding Officer erred in concluding that the 1st Claimant had “accepted the cancellation of the August Saturday shows” in the sense that he had agreed to the changes to the performance schedule pursuant to clauses 1.5 and 1.8. 31.Lastly, the Defendant argued at the appeal hearing that it was entitled to cancel the August Saturday shows pursuant to clause 4.1 of the Contract, namely, the poor quality of performance by the 1st Claimant. In the Reasons for Decision, the Presiding Officer did not mention clause 4.1 as entitling the Defendant to cancel the August Saturday shows. Although she did make factual findings on the quality of 1st Claimant’s performance, they were made in the context of identifying COD as the originator of the decision to cancel the shows. The Presiding Officer found that it was COD which had a control over the arrangement of performance and in that sense, the Defendant was acting passively and deriving no pecuniary advantage in the cancellation of the shows. The Presiding Officer did not find that, pursuant to clause 4.1, the Defendant was entitled to cancel the August Saturday shows. In fact, if she were to so hold, she would be wrong because clearly from the evidence, the Defendant did not cancel the shows on the ground of dissatisfaction over the 1st Claimant’s performance. It is readily apparent from the Defendant’s own email dated 25th July 2009 as set out in paragraph 26 above. The Defendant simply thought that they had to cancel the shows because its client COD did not want them. It even tried to protest but in vain. The Defendant then asked for the 1st Claimant’s understanding of the situation it faced. Whether or not the Defendant was wholly satisfied with the 1st Claimant’s performance is not the issue. It is important to remember that the Contract was between the 1st Claimant and the Defendant. Obligations in the Contract were not expressed to be subject to the views or decisions of COD. 32.Furthermore, under clause 4.1.1, if the Defendant was dissatisfied with the 1st Claimant’s performance, it shall have the right to “replace” the performer. The cancellation of August Saturday shows was not a “replacement” of the 1st Complainant or his band at all. They were to required to continue playing albeit on Fridays and Sundays only. In my view, the entire issue of “quality of performance” was a red-herring. The sole issue was whether contractually, the Defendant was entitled to unilaterally cancel those performances stipulated in Schedule B without the prior agreement of the 1st Claimant. Cost of Accommodation 33.The 1st Claimant claimed for cost of accommodation in respect of 16/8/09; 21/8/09; 23/8/09; 28/8/09 and 30/8/09. 21/8/09 and 28/8/09 were Fridays. The rest were Sundays. Clause 2.3.1.2 of the Contract provided for the Defendant’s obligation to provide hotel accommodation for “each night performing”. By an email dated 13th August 2009 from the 1st Claimant to Lau, the 1st Claimant said:-
34.Lau replied to the above email on 13th August 2009 as follows:-
35.Based on the above emails, the 1st Claimant’s complaint about no hotel room on the 3 Sundays he claimed was without merits. As for the 2 Fridays, Lau referred the Court to Defendant’s exhibit D-3(11)(b) which was a documentary record of reservations of rooms in the 1st Claimant’s name. They were entirely consistent with the stance of Lau as set out in his 13th August 2009 email. I therefore equally find that the 1st Claimant’s claim in this regard was unmeritorious. In any event, the 1st Claimant admitted to the Presiding Officer and to this Court that he did not spend his own money on seeking accommodation on those nights which were the subjects of his claim. The Presiding Officer was right to find that the 1st Claimant did not suffer any actual loss. Whether or not there was a breach of clause 2.3.1.2 of the Contract is purely academic. The 1st Complainant would not in any event be entitled to damages over and above an award of nominal damages in the conventional sum of HK$1. Conclusion 36.In the circumstances, I allow this appeal and grant judgment in favour of the Appellant (the 1st Claimant) in the sum of HK$10,000.00 which represents 4 cancelled Saturday performances of HK$2,500 each for 8/8/09; 15/8/09; 22/8/09 and 29/8/09. It is clear from Defendant’s exhibit D-3(8)(e) that the 1st Claimant had been paid for 1/8/09 even though he was not required to perform on that Saturday. 37.I also make an order nisi that the 1st Claimant shall have costs of this appeal against the Defendant to be taxed if not agreed. Unless there are applications to vary the costs order nisi within 14 days from the date of this Judgment, it shall become absolute on the expiration of 14 days from the date of this Judgment.
1st Claimant/Appellant in person Defendant/Respondent in person, represented by Lau Chun Kong | ||||||||||||||||||