AXELBANK ERNEST v. ARTIFICIAL LIFE ASIA LTD

HCLA 15/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

LABOUR TRIBUNAL APPEAL No 15 of 2013

(ON APPEAL FROM LABOUR TRIBUNAL CLAIM NO 1170 OF 2013)

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BETWEEN

AXELBANK ERNEST Claimant
(Respondent)
and
ARTIFICIAL LIFE ASIA LIMITED Defendant
(Appellant)

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Before: Hon Mimmie Chan J in Chambers

Date of Hearing: 19 March 2014
Date of Decision: 19 March 2014

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D E C I S I O N

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1. In relation to the claim that the Tribunal had made findings outside its jurisdiction, I am not satisfied that the Defendant hasany arguable ground of appeal. It is clear from the Presiding Officer’s Reasons for Decision that he simply rejected the Defendant’sevidence and claims that there was any agreement whereby the Claimant had agreed to offset his salary from the Defendant againstthe purchase price of the allotment of 16% of the shares in Alife Studios Inc (ASI) to the Claimant. The Tribunal Officer consideredthat such claim is inconsistent with the language used in the letter dated 23 December 2011 relied upon by the Defendant in supportof the alleged agreement, and inconsistent with the Defendant’s continued payment of salary to the Claimant for some months. TheTribunal Officer clearly preferred the evidence of the Claimant to that of the Defendant, and findings of fact are not subject toappeal under the Labour Tribunal Ordinance.

2. Nor am I satisfied that the Defendant has any arguable ground of appeal on the basis that the Tribunal had exceeded its jurisdiction,or had erred in law in not transferring the case to the Court of First Instance. The Defendant had argued before the Tribunal thatthe dispute should be transferred as it related to the shares in ASI. The Presiding Officer considered that the share dispute wasa separate matter between the Claimant and ASI, which was not a party to the proceedings before the Tribunal. In any event, thePresiding Officer rejected the claim made by the Defendant, that the purchase price of the shares in ASI was agreed between the Claimantand the Defendant to be offset against the salary payable by the Defendant to the Claimant. There is no claim or evidence of anytripartite agreement, now argued by counsel.

3. The Presiding Officer had considered the Defendant’s claim relating to the alleged agreement to offset salary against the Claimant’spayment for shares, and the Defendant’s claim that the Claimant had misappropriated its property. He considered these mattersto be irrelevant to the dispute between the Claimant and the Defendant, and for that reason declined to transfer the claim to theHigh Court. It cannot be said that in the exercise of his discretion, the Presiding Officer had taken into consideration irrelevantmatters or had failed to consider relevant matters, to warrant the appellate court’s interference.

4. The Claimant’s claims for arrears of wages and other payments due under his employment contract with the Defendant, a Hong Kongcompany, is clearly within the jurisdiction of the Tribunal under paragraph 1 (b) of the Schedule to Cap 25. The Presiding Officerdid not make any ruling or finding on any tortuous claim relating to the Defendant’s property.

5. I reject the claims that the Tribunal Officer had failed to discharge his duty to investigate, or that the Defendant had been deniedthe opportunity to present its case or to test the Claimant’s case. The Defendant chose for its own reasons not to attend thetrial, after several requests for postponement. The Defendant’s representative was given the opportunity to put questions to theClaimant and to present its case, and whether to call witnesses other than Mr Schoneburg to give evidence on the disputed matters.

6. However, I am satisfied that there is an arguable ground of appeal based on errors of law, that the Tribunal had erred in its calculationof the long service payments due to the Claimant, by taking into account the number of years of employment by entities other thanthe Defendant before 2012, under contracts of employment entered into outside Hong Kong, with an overseas company which has no registrationin Hong Kong, and not for performance in Hong Kong, and whether there is any evidence available before the Tribunal to justify suchinclusion, in the form of there being a transfer of ownership of business from Artificial Life Inc to the Defendant.

7. I will accordingly grant leave to appeal only on this ground.

(Mimmie Chan)
Judge of the Court of First Instance
High Court

Mr Lawrence Ngai, instructed by SH Chou & Co, for the defendant/appellant