Ko Hon Yue v. Chiu Pik Yuk and Others

HCA3494/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 3494 OF 2003

(Transferred from Labour Tribunal Claim No. LBTC 5616 of 2003)

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DECISION

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Introduction

1.After a trial that took 19 days, I handed down judgment on 4 August 2008 dismissing the plaintiff’s claim against the 1^st defendants.  The plaintiff successfully appealed to the Court of Appeal.[1] Upon the 1^st defendants’ appeal, the Court of Final Appeal allowed the appeal in part and ordered in §79 of its judgment dated 23 February 2012[2] that the matter be remitted to the trial judge for determination of two issues, namely, (1) whether the plaintiff’s contract of employment had been lawfully terminated by the defendants; and (2) If there was a wrongful termination, the damages that should be awarded to the plaintiff. 

2.The hearing of the determination is scheduled to take place on 27 April 2015 with four days reserved.

3.The plaintiff seeks to adduce for the purpose of the determination a 2^nd supplemental witness statement of the plaintiff together with annexes.  The 1^st defendants oppose the application.  The parties have no objection to the application being dealt with on paper and had, pursuant to my directions, lodged written submissions on it.

The plaintiff’s 2^nd supplemental witness statement

4.The plaintiff’s 2^nd supplemental statement (“the Further Statement”) relates to the second issue of damages. It covers the plaintiff’s post-trial attempts to seek teaching employment, his income after the trial and the quantification / projection of loss of income and provident fund benefits from 2001 to the time when the plaintiff will reach the retirement age of 60.  The annexes, which are in excess of 408 pages, cover copies of job application letters written by the plaintiff post-trial, a table of the plaintiff’s income, tax documents, information of salaries adjustments for teachers in subsidized secondary schools up to 2013, the plaintiff’s provident fund and MPF statements, computation of provident fund and MPF projected up to his retirement, and document relating to the plaintiff’s withdrawals from his provident fund account.

The arguments

5.The plaintiff’s purpose in adducing the Further Statement and the annexes are to show: (1) the plaintiff’s efforts in searching for teaching jobs after the trial; (2) the income earned by the plaintiff since his dismissal in 2001 up to present; (3) the salary that the plaintiff expects to be paid by the 1^st defendants had he not been dismissed in 2001; and (4) the provident fund entitlement that the plaintiff expects to receive from 2001 until retirement had he not been dismissed.

6.Miss Wong for the plaintiff argues that in the determination of the two issues, the court is in effect conducting a rehearing of the matter, which should be based on evidence already adduced at the trial as well as relevant fresh evidence, including evidence on matters that have occurred after the trial.  It is submitted that, as far as new evidence on matters that already existed at the trial, since there has not been a decision on the issue of quantum of damages, all relevant evidence, including evidence not adduced at the trial, should be received and considered by the court.  With regard to evidence on post-trial matters, it is further argued that since the evidence did not exist at the trial, the principles for adducing fresh evidence as laid down in Ladd v. Marshall [1954] 1WLR 1489 do not apply.  In support of the plaintiff’s application, Miss Wong relies on Townsend v. Achilleas [2001] C.P. Rep. 45, applied in Chow Siu Po v. Wong Ming Fung, unreported, HCAP3/1998 (23 July 2003), and Charlesworth v. Relay Roads Ltd [2000] 1 WLR 230 which held that fresh evidence may be received after judgment has been rendered but before the order is drawn up and that the trial judge may apply the Ladd v. Marshall principles with slightly more flexibility.

7.Mr Lee for the 1^st defendants, on the other hand, points out that while the Court of Final Appeal has power under section 17(1) and (2) of the Hong Kong Court of Final Appeal Ordinance, Cap. 484 to order a re-trial or new trial on the two issues, it has only remitted the matter to the Court of First Instance for determination and has not stated in its judgment that the parties may adduce further evidence on the two issues.  This, together with other objective circumstances, indicates that the Court of Final Appeal contemplates the determination to be based on the evidence that had already been adduced at the trial. 

8.Mr Lee further submits that the principles in Ladd v. Marshall are generally applicable to cases where fresh evidence is sought to be adduced, the underlying rationale being the fundamental principle that a party should not be allowed to have multiple “bites of the cherry”.  Although it is said in Charlesworth v. Relay Roads Ltd and Townsend v. Achilleas that the principles in Ladd v. Marshall may be applied with slightly more flexibility in an application to adduce fresh evidence before the trial judge, the reasons for adopting a cautious approach to the application of the Ladd v. Marshall principles have no application to the present case, having regard to the circumstances of the case. It is also Mr Lee’s submissions that the fresh evidence that the plaintiff seeks to adduce cannot meet the requirements in Ladd v. Marshall.

Discussions

9.Under section 17(1) and (2) of the Hong Kong Court of Final appeal Ordinance[3], it is within the power of the Court of Final Appeal in disposing of an appeal to order a retrial or to remit the case back to the lower court for further determination.  In the present case, the Court of Final Appeal has decided to remit the case to the Court of First Instance for making further findings on two issues in accordance with the law as stated in its judgment.  In my view, it is tolerably clear from reading §79 of its judgment that the Court of Final Appeal has not intended a rehearing or admission of evidence afresh and has intended the determination to proceed on the basis of the evidence already adduced at trial. 

10.In particular, when giving guidance on how to approach the two issues, the Chief Justice has, in relation to the second issue of damages, made specific references to relevant aspects of the evidence in the case:

“In the present case, the court might have to consider whether, even if the requirements of clause 56(g) and Appendix 17 had not actually been fulfilled (the matter to be determined under sub-para (1) above), that clause and Appendix was relevant in the assessment of damages. This would require the court (when looking at Appendix 17) to see whether the plaintiff’s work had been unsatisfactory, if so whether warnings could have been given, (as required by paras (a) and (b) of the Appendix), whether the plaintiff might have made any improvement and finally, taking into account the requisite period of notice to be given. The object would of course be to calculate the appropriate period when the plaintiff could be expected to be paid his salary until his contract of employment would have been terminated. Even if looking at clause 56(g) and Appendix 17 is not the appropriate method of assessment, the judge will of course take into account other factors. I note that in her Judgment in dealing with the issue of damages, the learned judge made a number of observations (see paras 258-263 of the Judgment).”

11.Further, the trial that had taken place was not a split trial on liability.  The plaintiff had adduced extensive evidence on all aspects of the case, including loss and damage said to have flowed from the wrongful termination of his employment contract.  There was both oral and documentary evidence from the plaintiff on loss of income and provident fund and also in relation to mitigation of loss. He had also been subject to cross-examinations on these aspects of his case.  It is also to be noted that the termination of the plaintiff’s employment took place in 2001, more than ten years before the appeal came before the Court of Final Appeal.  There is no reason to believe that the Court of Final Appeal would not have borne in mind the above considerations when coming to the decision to remit the matter for further determination.  Had it been contemplated that the determination would proceed on the basis of new or further evidence, the judgment and the order[4] of the Court of Final Appeal would have made this abundantly clear.

12.In light of the above, I do not accept that it is implicit in the order of the Court of Final Appeal or within the contemplation of the Court of Final Appeal, in remitting the case for determination, that the parties may be at liberty to adduce further or new evidence on the two issues to be determined.

13.That said, however, I accept the trial judge has a discretion to admit further or new evidence at the hearing on the determination.  In Charlesworth v. Relay Roads Ltd, in allowing in part the defendant’s application, made after judgment was handed down but before the order was drawn up, to amend its pleadings that involved new arguments and further evidence, Neuberger J (as he then was) held that (at 234G-H) as a matter of principle, if “the judge retains control of the case, to the extent of being able to reconsider the matter of his own motion or to hear further argument on a point which he has decided, there must be power to permit pleadings to be amended, even if that involves a new argument being put forward, or further evidence being adduced, or even both.”

14.In my view, this principle also applies here.  The issue that falls to be considered is whether the plaintiff ought to be permitted to re-open his case on damages and to adduce the Further Statement and the annexes.  I shall first begin with the relevant principles. 

15.In Ladd v. Marshall, Denning LJ said (at 1491) the three factors “always applied when fresh evidence is sought to be introduced”.  In Charlesworth v. Relay Roads Ltd, Neuberger J said that (at 237F-H) Ladd v. Marshall should be at the forefront of the mind of the court when considering an application to admit new evidence, but that a trial judge is entitled to be somewhat more flexible than the Court of Appeal.  It is considered that the trial judge, having heard all the witnesses, would be in a better position to receive fresh evidence than the Court of Appeal, who would have to reassess all the facts or decide what effect the new evidence would have had on the trial judge, or has to take the unsatisfactory course of ordering a retrial.  This view was approved in Townsend v. Archilleas. Mummery LJ, giving the judgment of the English Court of Appeal, held that there is a good case for the cautious application of a slightly more flexible test for the reasons given by Neuberger J.  In Hong Kong, this approach was applied by Deputy High Court Judge Lam (as he then was) in Chow Siu Po v. Wong Ming Fung §12 and also by Harris J in Re China Medical Technologies Inc,unreported, HCCW 435/2012 (28 August 2014) §20.

16.It is, however, important also to bear in mind the observations of Neuberger J (at 238D-E) that, despite the perceived advantage that the trial judge may enjoy, 

“in many cases that exercise will be difficult, bearing in mind the passage of time between the hearing of the original witnesses and the hearing of the new evidence, and the fact that the judge has already given a judgment into which the new evidence will have in some way to be fed.”

And that (at 237G-H):

“in many ways, an applicant seeking to persuade the judge to receive fresh evidence and/or argument on a new point is in a very similar position to an appellant seeking similar relief from the Court of Appeal. He has had a full opportunity to collect his evidence and to marshall his arguments, and there must be a strong presumption against letting him have a second chance, particularly after he has seen in detail from the judgment why he has lost.”

17.Further, it can be seen from the judgments in Townsend v. Archilleas and Charlesworth v. Relay Roads Ltd that the Ladd v. Marshall principles, while of central importance, are not the only relevant considerations.  Both judgments had made reference to the overriding objective in rule 1.1 of the Civil Procedure Rules 1998, the balancing exercise of finality of litigation and the interests of justice as well as the court’s duty to ensure fairness to all parties.  Mummery LJ also referred to another decision of the Court of Appeal in Stewart v. Engel [2000] 1 WLR 2268 which held that the jurisdiction to reopen a case after judgment had been given should be sparingly exercised and only where there were exceptional circumstances or strong reasons for doing so since finality and the doing of justice requires justice to all parties in the litigation.

18.I next turn to consider the circumstances of this case.  It is important to have regard to two matters that will call into consideration the observations made by Neuberger J (see §16 above).  First, the underlying reason for a less stringent application of the Ladd v. Marshall principles, namely, the trial judge who had heard the evidence would be in a better position in deciding the effects of the fresh evidence and reassessing the facts of the case, has no real application here.  This is because there has been a very long lapse of time since the trial which took place in 2007.  On any view, any advantage that the trial judge may enjoy will be minimal.  Second, the action had been on foot for nearly four years before it went to trial.  Damages and the duty to mitigate are live issues in the case.  There was ample opportunity for the plaintiff to gather evidence and to adduce all relevant evidence and arguments that would advance his case.  As mentioned above, the plaintiff had adduced a good deal of oral and documentary evidence on the issues of damages and steps taken by him to mitigate his loss during the trial that took 19 days.  In fact, some of the documentary evidence and the quantifications relating to loss of income and provident fund were only introduced for the first time in the course of the trial.  This is a case where the cardinal principle of finality of proceedings should be accorded due consideration. 

19.In my view, it is incumbent upon the plaintiff to demonstrate there are justifiable circumstances for the admission of the Further Statement and the annexes and that they fulfil the requirements in Ladd v. Marshall.

20.With regard to the further evidence on the plaintiff’s loss up to the time of the trial, which includes evidence relating to his income up to 2007 as well as the salary and provident fund benefits he expects to receive between 2001 and 2007 had he not been dismissed in 2001, it clearly fails the first Ladd v, Marshall requirement that the evidence could not be obtained with reasonable diligence for use at the trial.  At the trial, the plaintiff had already adduced quite some evidence on these aspects of his case on damages.  There is no good explanation why the further evidence he now seeks to introduce were not or could not be produced at the trial.  It would therefore be wrong and against the court’s duty to do justice to all parties in the litigation to allow the further evidence to be adduced at the hearing of the determination.

21.As for the evidence on post-trial matters, which includes the job application letters written by the plaintiff, evidence relating to his post-trial income as well as the salary and provident fund benefits he expects to receive after 2007 up to his age of retirement, it has firstly to be considered against the scope of the hearing on the determination.  In remitting the matter for determination, the Chief Justice had in sub-paragraph (b) of §79 of the judgment of the Court of Final Appeal set out the matters that will be relevant in the assessment of damages.  Of first relevance is clause 56(g) and Appendix 17 of the Code of Aid, the consideration of which will involve looking into the plaintiff’s work performance, whether warnings could have been given and whether any improvements might have been made and also the requisite period of notice to be given for termination of employment.  In the context of factors outside clause 56(g) and Appendix 17, the Chief Justice took note of §§258-263 of my judgment in which I observed that (1) the plaintiff had not been completely forthcoming on the real reasons why he was not re-employed as a permanent full-time teacher, which had more to do with his personal circumstances and choice or preference for employment than his dismissal, (2) there was no evidential basis for a case of loss of reputation, and (3) the documents and evidence relating to loss of provident fund entitlements failed to substantiate his claim and quantifications under this head. 

22.Plainly, the Further Statement and the annexes only relate to factors that should be considered outside clause 56(g) and Appendix 17.  It is aiming to address the three observations and in turn to improve the plaintiff’s case on the claims for (i) loss of income and (ii) loss of provident fund benefits.  However, the fresh evidence on the plaintiff’s post-2007 attempts to find employment, taken at its highest, only shows that many applications for teaching positions had been made.  It does not go to show the reasons for the plaintiff’s failure or inability to secure a reasonable alternative teaching employment, let alone demonstrate a causal connection with his dismissal in 2001.  In relation to the fresh evidence on the plaintiff’s income, it is, as Mr Lee pointed out, incomplete and does not give a full and reliable picture of the plaintiff’s actual income and in turn the extent of loss of income and provident fund benefits.  For instance, while the plaintiff has put forward information from the Inland Revenue Department (IRD) extracted from Employer’s Return of Remuneration and Pensions previously reported to the IRD, and a table of income based on the IRD information, the plaintiff has not provided any of his tax returns over the years. 

23.As such, the evidence on post-trial matters cannot meet the second and third requirements in Ladd v. Marshall, namely, the fresh evidence would probably have an important influence on the result of the case, though need not be decisive, and that the fresh evidence is apparently credible, though need not be incontrovertible. 

24.Moreover, in exercising the court’s discretion, regard should be made to the underlying objectives in Order 1A rule 1 of The Rules of the High Court, Cap. 4A which include increasing the cost-effectiveness of proceedings, promoting a sense of reasonable proportion and procedural economy in the conduct of the case and also ensuring fairness between the parties.  If the fresh evidence were allowed to be adduced, it will inevitably lead to request/ application for further discovery and the 1^st defendants will also be put to the task of investigating into the veracity of the evidence.  Mr Lee in his submission has also alluded to the possibility of discovery from third parties, such as to verify whether the job application letters had been sent or received.  At the same time, if the fresh evidence were to be admitted, the 1^st defendants would most probably have to further cross-examine the plaintiff. All of these would involve increase time and costs and go against the efficient conduct of this very old piece of litigation. 

25.Further, given the lapse of time, the 1^st defendants’ concern about the difficulty and inconvenience it would face in having to meet the fresh evidence so many years after the event is a real and genuine one.  In this connection, the court should also not lose sight of the fact that, rather than to update the court on the development of the relevant events, the fresh evidence in question is directed at improving the plaintiff’s case on damages in the light of the observations made in my judgment.  As said by Neuberger J (at 238G-H), “consideration must be given to anxieties and legitimate expectations of the other party, the efficient conduct of litigation, and the inconvenience caused to other litigants” and that “it is inherently contrary to the public interest and unfair on the other side that an unsuccessful party should be able to raise new points or call fresh evidence after a full and final judgment has been given against him”.  Neither the circumstances of this case nor fairness justifies the admission of the fresh evidence. 

Conclusion

26.For the reasons set out above, I will not give leave to the plaintiff to adduce his second supplemental witness statement and the annexes.  Applying the normal rule of costs follow event, I make an order nisi that the plaintiff pays the 1^st defendants the costs of the application in any event.

Miss Linda Wong instructed by Ho Tse Wai, Philip Li & Partners for the plaintiff.

Mr Lee Tung Ming instructed by ONC Lawyers for the 1^st defendants.

[1] [2011] 1HKLRD 733

[2] (2012) 15 HKCFAR 72, 112.

[3] “17(1) The Court may confirm, reverse or vary the decision of the court from which the appeal lies or may remit the matter with its opinion thereon to that court, or may make such other order in the matter, including any order as to costs, as it thinks fit.   (2) For the purpose of disposing of an appeal, the Court may exercise any powers of the court from which the appeal lies (including the power to order a retrial), or may remit the case to that court.”

[4] See §90 of the Judgment.