Sunny Tadjudin v. Bank of America, National Association

HCMP 337/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 337 OF 2012

(ON AN INTENDED APPEAL FROM HCA NO. 322 OF 2008)

________________________

BETWEEN

Before: Hon Tang VP and Fok JA

Date of Judgment: 29 March 2012

________________________

J U D G M E N T

________________________

Hon Tang VP:

1.I agree with the judgment of Fok JA.

Hon Fok JA:

The application

2.The plaintiff applied by summons for 40 items of specific discovery and for answers to 63 requests for further and better particulars of the defence.  By orders respectively dated 22 December 2011 and 6 January 2012, Deputy Judge Mimmie Chan (i) ordered discovery by the defendant of 12 of the items sought by the plaintiff and (ii) ordered the defendant to answer 5 of the requests for further and better particulars of the defence.  The plaintiff being dissatisfied with the outcome of her application, she applied to the Judge for leave to appeal.  The Judge refused such leave by her Decision dated 9 February 2012.

3.This is the plaintiff’s renewed application to this court, by summons dated 23 February 2012, for leave to appeal pursuant to RHC O.59 r.2B.  The summons annexes a draft notice of appeal and is supported by an affirmation of the plaintiff and by written submissions prepared by counsel, Mr José-Antonio Maurellet.

4.The defendant has also submitted a statement in opposition to the application, pursuant to RHC O.59 r.2A(4).

The background

5.The background to this matter is concisely summarised in the Judge’s Decision dated 22 December 2011 at paragraphs 1 to 5.[1]  In short, the plaintiff was employed by the defendant from April 2000 but her employment was terminated in August 2007 in breach, says the plaintiff, of three implied terms of her employment contract.  She claims, in this action, damages from the defendant in the sum of $28.3 million.

6.The implied terms, which it is alleged the defendant has breached, are pleaded in the following terms, namely contractual duties:

(1) “not to exercise its right to terminate the Plaintiff’s employment by giving one month’s notice in writing or by paying one month’s salary in lieu of notice in order to avoid the Plaintiff’s being eligible for the Defendant’s performance incentive program”;

(2) “not to implement its performance evaluations in respect of the Plaintiff in an irrational, perverse or arbitrary manner or in a manner that was not bona fide”; and

(3) “not to administer its performance incentive program in respect of the Plaintiff in an irrational, perverse or arbitrary manner or in a manner that was not bona fide.”

7.Another implied term, breach of which had originally been pleaded by the plaintiff, was a duty “not to commit any unlawful act of discrimination against the Plaintiff”.  That term was, however, struck out from the pleading on the ground that it infringed the exclusive jurisdiction of the District Court in sex discrimination complaints.[2]  The plaintiff has since commenced proceedings in the District Court (DCEO 4/2009) alleging various breaches of the Sex Discrimination Ordinance (Cap. 480).

The relevant test for leave

8.It is common ground that the Judge’s decision is interlocutory in nature and, as such, pursuant to s. 14AA of the High Court Ordinance (Cap. 4), the plaintiff requires leave to appeal against the orders dated 22 December 2011 and 6 January 2012.  The applicable principles[3] are now well known and I do not propose to repeat them here.  The plaintiff must show that the proposed appeal has a reasonable prospect of success or that there is some other reason in the interests of justice why the appeal should be heard.

Is there an appeal with a reasonable prospect of success?

9.The draft notice of appeal seeks an order for specific discovery of the following documents set out in the plaintiff’s schedule of specific discovery documents requested, namely items D18-20, D23-24, E26, F28-29, G33-36 and H37, and an order that the defendant provide answers to requests 17, 20, 22, 26, 29 and 37 of the plaintiff’s request for further and better particulars of the defence.

10.Before considering the individual grounds of appeal, I note that the Judge recorded that there was no dispute between the parties before the Judge as to the legal principles applicable to the determination of the plaintiff’s application for discovery.[4]  The Judge also noted that the focus of the arguments advanced at the hearing had been on whether the discretion of the Court should be exercised to order discovery.[5]

11.So far as the application for further and better particulars was concerned, the Judge noted that under RHC O.18 r.12(3B) no order for particulars shall be made unless the court is of the opinion that the order is necessary either for disposing fairly of the cause or matter, or for saving costs.  A decision of this nature is an exercise of judicial discretion.

12.As the Judge rightly noted in her Decision of 9 February 2012:

“4. Orders for discovery under Order 24, for particulars under Order 18 rule 12 and for costs are all in the discretion of the court. The authorities are clear that an appellate court would only interfere with a trial judge’s exercise of discretion where the judge has erred in law or in principle, or if the judge has taken into account some matter which he or she should not have taken into account or has left out of account some matter which he or she should have taken into account, such that the judge was plainly wrong. The fact that the appellate court may exercise a discretion differently on the same facts is no ground to substitute its discretion for that of the trial judge.”

13.Grounds 1 and 2: These grounds relate to discovery items E26 and G33-36 and request 26 of the request for particulars.  The gravamen of the plaintiff’s complaint in these grounds is that the Judge “wrongly applied a strict dichotomy between the question of ‘whether the Defendant had a discriminatory policy’ and the question of ‘whether [the Defendant’s] determination of the Plaintiff’s entitlement to the bonuses for the years 2005, 2006 and 2007 were irrational, perverse or such that no reasonable employer could have so decided in the circumstances of the case” and that she was wrong to hold that the latter question was, but the former question was not, an issue for trial.

14.However, in the light of the pleaded issues in this action (and also bearing in mind the proceedings in DCEO 4/2009) I consider that the Judge was correct in holding, in her Decision dated 22 December 2011:

“19. … the issue for trial in these proceedings is not whether the Defendant had a discriminatory policy against female employees. The real issue is whether, on the basis that the implied terms contended for by the Plaintiff do form part of the Employment, the Defendant was in breach of contract in that its assessment of the Plaintiff’s performance for 2006 and/or 2007, and its determination of the Plaintiff’s entitlement to the bonuses for the years 2005, 2006 and 2007 were irrational, perverse, or such that no reasonable employer could have so decided in the circumstances of the case … .”

15.The Judge was also correct, in my view, in saying (in the same Decision):

“58. … Whether or not the Defendant has a sexually discriminatory policy or practice is more properly the subject of the Discrimination Proceedings which are currently on foot. …”.

16.The Judge did not refuse to order specific discovery of discovery item E26 (“quarterly end usage reports including details of individual assets from 1H 2000 to 1H 2007”) and items G33-36 (documents relating to treatment and comparison of male and female employees of the defendant) on the grounds of relevance but rather, by reference to the documents already discovered, she ruled that these classes of documents were not necessary for disposing of the issues in these proceedings.

17.As to item E26, the Judge did not think further discovery of end usage reports was necessary for disposing of the issues in this action:

“… which are not about whether the Defendant generally discriminates against its female employees, but whether its decisions to terminate the Employment and relating to the bonuses awarded to the Plaintiff were, in any way or for whatever reason, perverse, irrational or not bona fide.”[6]

18.As to the documents in category G, the Judge held that it was unnecessary to order discovery of those documents.[7]

19.Grounds 1 and 2 contend the Judge erred in relation to the relevance of those discovery items but, as I have noted, the Judge exercised her discretion to refuse discovery not on the ground of relevance, but rather, on the ground that discovery was not necessary.  There is no challenge to the exercise of her discretion in this regard and I see no basis for interference with it.  I shall address request 26 of the request for particulars below.

20.Ground 3:  This ground relates to discovery items D18-20, D23 and D24 and concerns the weight attached by the Judge to the employment history and experience of Mr John Liptak, a former colleague of the plaintiff in the defendant’s International Special Situation Group (“ISSG”) who she contends is a comparator for her.  The proposed ground of appeal contends the Judge erred in failing to take into account or give due weight to the matters listed in paragraphs (1) to (3) of this ground.

21.The Judge dealt with the documents in relation to Mr Liptak at paragraphs 38 to 47 of her Decision dated 22 December 2011.  It is clear, from what she said in paragraph 41, that the Judge considered the documents might be relevant, but also clear, from paragraph 42, that she was aware of the need to balance issues of confidentiality of Mr Liptak and the defendant and, from paragraph 43, that:

“… the task of the Court is to determine when doing justice to the claim stops, and ‘fishing’ starts, when ‘the onerous nature of the discovery exercise passes from the necessary and permissible to the unnecessary and impermissible’.”

22.Adopting this approach, the Judge performed the requisite balancing exercise and ordered discovery of some items, D16 and D17, but refused, in the exercise of her discretion, discovery of others, including D18-20, D23 and D24.  It is not the case that the Judge held the documents to be irrelevant but, rather, she held that it was not appropriate to enlarge the ambit of this action so that it became a trial of Mr Liptak’s performance.

23.Ground 3 seeks to challenge the Judge’s exercise of discretion but an analysis of the relevant parts of the Decision demonstrate, in my judgment, that there is no reasonable prospect of success in the proposed challenge.

24.Ground 4:  This ground relates to discovery items F28 and F29.  It is said that the Judge erred in failing to take into account or give due weight to the profit and loss figures of the defendant’s ISSG.

25.The Judge noted that the defendant had already disclosed the profit and loss reports of the ISSG relating to the analysts within the ISSG, except for the 2007 revenue report showing the profit and loss contributions by analyst.[8] However, she concluded that the discovery of additional documents was not necessary. 

26.This was an exercise of discretion on the part of the Judge and, in my judgment, ground 4 does not give rise to an appeal with a reasonable prospect of success.

27.Ground 5:  This ground relates to request 26 of the request for particulars and seeks to challenge the Judge’s conclusion that “further particulars of the claim of alleged discrimination are not necessary in these proceedings”[9] and that the defendant’s clear denial made further particulars unnecessary.

28.To put the request for particulars into context, request 26 seeks particulars of paragraph 26 of the Defence, which denies the plea in paragraph 17 of the Amended Statement of Claim of a breach of contractual duty by the defendant by reason of the fact that the plaintiff was treated less favourably than Mr Liptak in terms of financial compensation, opportunities for promotion and access to facilities and services.

29.I am unable to see any reasonable prospect of disturbing the Judge’s exercise of discretion in relation to this request for particulars. I do not consider that RHC O.18 r.13(3), which is referred to in ground 5 and which prohibits pleading by way of general traverse, assists the plaintiff.  Nor do I consider that RHC O.18 r.13(5), introduced as part of the Civil Justice Reform, assists the plaintiff since the defendant has pleaded in paragraphs 11 to 25 of the Defence the reasons for its denial of the contention that the plaintiff was treated less favourably than Mr Liptak.

30.Ground 6: This ground relates to request 29 of the request for particulars and contends that the Judge erred in concluding that the requested particulars were matters of evidence.

31.In paragraph 25 of the Amended Statement of Claim, the plaintiff pleads that Mr Liptak had no or no sufficient cause to issue a warning letter to her.

32.In response, the Defence pleads, at paragraph 33(3), that shortly after the appointment of Mr Liptak as Head of the Hong Kong Desk in January 2005, conflicts surfaced between the plaintiff and Mr Liptak: she refused to recognise his role as Head of Desk, refused to keep him informed of her projects and made deliberate attempts to skip the reporting line.  It is pleaded that such behaviour on her part significantly disrupted the operation of the Hong Kong Desk of the ISSG as a team.

33.The request seeks particulars of the facts, matters and circumstances relied upon in support of the allegations in the plea. The Judge held that the defendant had already pleaded the material facts relied on as to its reason for issuing the warning letter and that the further matters sought by the plaintiff constituted evidence to prove these pleaded facts, to which the plaintiff was not entitled.[10]

34.I am satisfied that ground 6 does not give rise to an appeal with a reasonable prospect of success in respect of the Judge’s refusal to order the defendant to answer this request for particulars.  The issue is whether the defendant acted irrationally and, since the defendant has pleaded the reasons for its actions, these particulars are not necessary.  In any event, I am unable to see how the plaintiff will be surprised at trial if the request is not answered, since the pleas are sufficiently clear and the plaintiff will know from the witness statements what evidence she has to answer.

35.Ground 7:  This ground relates to discovery item H37 seeking the “complete chain of correspondence/emails” in respect of a series of correspondence and emails already disclosed.  It is contended that a reasonable person would have understood what a “complete chain” of emails meant, namely “all emails originating from one source email at the beginning of the chain”.

36.Even if that be correct, the Judge gave a number of reasons for refusing discovery of this item.  In her Decision dated 22 December 2011, she held:

“59. Discovery has already been made of a long series of correspondence and e-mails. The Plaintiff seeks discovery of the ‘complete chain’ of such correspondence. This request covers a wide category of documents, but is imprecise as to when the ‘chain’ can be considered to be ‘complete’. The Plaintiff has failed to discharge the onus which is on her to identify what documents are missing in the chain, how they are relevant, and that they are in existence and in the possession of the Defendant. I will not make any order under this category.”

37.Ground 7 does not address the Judge’s other reasons for exercising her discretion to refuse to order discovery.  The Plaintiff has still not identified what documents are missing, why they are relevant, whether they are in existence and whether they are in the possession of the defendant.

38.I am, therefore, not satisfied that ground 7 gives rise to an appeal with a reasonable prospect of success in respect of the Judge’s refusal to order discovery of this item.

39.The other requests for particulars:  Although the draft notice of appeal indicates an intention to appeal against the Judge’s refusal to order six requests for particulars, the proposed grounds of appeal only address two of them.  As such, there is no basis for contending that there is a reasonable prospect of success in the appeal against the Judge’s refusal to order requests 17, 20, 22 and 37 of the request for particulars.

Residual discretion

40.The Judge identified, as an additional reason for refusing leave to appeal, the residual discretion which remains even if a court takes the view that there is a reasonable prospect of success in the intended appeal: see Ho Yuen Ki Winnie & Anor v Ho Hung Sun Stanley & Anor, unrep., HCA 391/2006, 25.5.09, A. Cheung J (as he then was) at §§7-9 and, on appeal, HCMP 1009/2009, 24.8.09 at §22.

41.In her Decision dated 9 February 2012, the Judge held:

“This action was commenced in 2008, but even now the parties have been bogged down at the stage of discovery without having made any progress to trial. A further round of argument over discovery, particulars or costs at the appellate level would only increase costs and further delay the trial, and would not advance the real interests of the parties or the due administration of justice in accordance with the objectives of the Civil Justice Reform. The interests of the parties in this case would be much better served by their actively progressing to the exchange of witness statements, and thereafter proceeding to have an early trial of the issues in dispute.”

42.I would fully endorse those remarks.  However, notwithstanding those remarks, the parties’ respective statements in support and in opposition to the application for leave to appeal refer to the fact that a contested discovery application was pursued by the plaintiff in the discrimination proceedings in DCEO 4/2009.  It appears that out of 39 requests, the Judge hearing that application ordered discovery in respect of 6 classes.  The plaintiff has indicated an intention also to seek to appeal that order for discovery.

43.The merits of that proposed appeal in DCEO 4/2009 are a matter for another occasion but, so far as the present application is concerned, it is my firm view that it is high time the interlocutory skirmishing in this matter came to an end and the action is taken to trial so that the real issues between the parties can be resolved.

Conclusion

44.For the above reasons, I would refuse leave to appeal and dismiss this application with costs to the defendant.

45.Furthermore, I consider that the application is totally without merit and, accordingly, I would make an order, pursuant to RHC O.59 r.2A(8), that no party may request the determination to be reconsidered at an oral hearing inter partes.

46.It would be appropriate to assess the costs of the defendants in respect of this application on a gross sum basis.  I would therefore direct the defendant’s solicitors to submit a bill of costs within seven days hereof and give leave to the plaintiff to submit her response within seven days thereafter.

Written submissions by Mr José A Maurellet, instructed by William K.W. Leung & Co., for the Plaintiff/Applicant

Written submissions by Mr Bernard Man, instructed by Mayer Brown JSM for the Defendant/Respondent