Where a Hong Kong permanent resident has an accident while working outside Hong Kong and would like to bring a claim against his or her employer in Hong Kong courts, there is a question of whether Hong Kong is the proper forum. This question of forum conveniens was one of the many issues considered by the Court of First Instance in Fong Chak Kwan v Ascentic Ltd and another [2020] HKCFI 679.

In this case, the Plaintiff, being a Hong Kong permanent resident, commenced an action in Hong Kong against the 1^st and 2^nd Defendants, whom the Plaintiff claimed to be his employer, for damages for personal injury, loss and damage sustained in a work accident which took place in China on 10 October 2014 (the “Accident”). The Employees Compensation Assistance Fund Board was granted leave to join the present action as the 3^rd Defendant. The 3^rd Defendant took out a summons for applications to, inter alia, (1) set aside the leave granted to the Plaintiff to serve a concurrent writ of summons on the 2^nd Defendant out of jurisdiction and the interlocutory judgment entered against the 2^nd Defendant (the “Setting Aside Application”), and to (2) permanently stay all further proceedings in the writ of summons (the “Stay Application”).

Among other things, the Court had to decide whether Hong Kong was the appropriate forum for the Plaintiff’s claim against the 2^nd Defendant for both the Setting Aside Application and Stay Application.

Legal principles

Although the issue of forum conveniens is relevant to the Court’s determination of both applications, the burden of proof is different. For the Setting Aside Application, the burden is on the Plaintiff to satisfy the Court that Hong Kong is clearly and distinctly the more appropriate forum for the present action; whereas the 3^rd Defendant (on behalf of the 2^nd Defendant) bears the burden to prove otherwise for the Stay Application.

The test is whether the forum is one with which the action had the most real and substantial connection. The starting point in tort cases is that the place where the tort was committed is the natural forum. However, the Court stressed that place of commission is by no means determinative. Other relevant factors the Court may consider would include:

1. The convenience and expense (such as availability of witnesses and/or documents);

2. The law governing the transaction;

3. The place where the parties reside or carry on business;

4. The nature of the case and the dispute; and

5. The legal and practical issues involved, e.g. questions of local knowledge, special expertise/experience of a particular forum in dealing with complex disputes etc.

Setting Aside Application

Forum conveniens was one of the many issues the Court was required to consider in determining the Setting Aside Application. As the Accident happened in Ningbo, the starting point was that PRC Courts were the appropriate forum. However, there were still many other factors to be considered.

Choice of law of the Plaintiff’s claim in contract and tort

Given the interlocutory context of the present case, the Court took the approach of assessing this issue in terms of the rubric of a “good arguable case”.

For the claim in contract, the Court found that there was a good arguable case that the governing law of the employment contract signed by the Plaintiff, the 1^st and 2^nd Defendants was Hong Kong law, taking into account the factual basis of the employment contract, such as the language used, place of execution, etc.

For the claim in tort, as the Accident happened in the PRC, in determining whether it is actionable in Hong Kong, the Court applied the double actionability rule. The first limb of the double actionality rule is that the wrong must be of such a character that it would have been actionable if committed in Hong Kong. The second limb is that the act must not have been justifiable by the law of the place where it was done. As there was nothing to suggest that the Plaintiff’s tort claim would not be actionable in Hong Kong law, nor was there any evidence that the 2^nd Defendant would not be liable for negligence under Hong Kong law and/or PRC law, the Court considered that there was a good arguable case that the Plaintiff’s tort claim could proceed in accordance with Hong Kong law.

Availability of witnesses

In addition to the choice of law of the Plaintiff’s claim, the Court also considered the factual focus and the evidence to be adduced in the present case to determine the issue of forum conveniens. In particular, the Court took into account of, inter alia, the following factors:

1. As the Plaintiff had returned to Hong Kong a few days after the Accident, the evidence (whether documents or witnesses) in the post-Accident period would mostly be from Hong Kong. As such, this means most witnesses on quantum matters (i.e. the Plaintiff himself and experts) would be from Hong Kong and it would be extremely inconvenient for them to travel to the PRC to give evidence.

2. It was doubtful whether the professional witnesses on quantum matters could be compelled to attend the PRC courts to give evidence.

3. Substantive costs had already been incurred for the claim as the Plaintiff had engaged local medical experts to prepare expert medical reports at an early stage.

4. The Court rejected the 3^rd Defendant’s contention that the Plaintiff’s pre-trial and post-trial loss of earnings would require evidence concerning the employment environment in Mainland China as the Plaintiff was offered employment in Hong Kong.

5. In alleging that there would be further evidence or witness to be discovered or located in Mainland China, the 3^rd Defendant failed to pinpoint for the purpose of the trial (1) who exactly would be the likely further witnesses residing out of jurisdiction, and (2) how important or relevant their evidence would be to the determination of the issues.

6. The Plaintiff was granted with legal aid in pursuing his claim against the 2^nd Defendant in Hong Kong, which he would not have if he were to start his claim afresh in the PRC courts.

Therefore, the Court held that Hong Kong was clearly and distinctly the forum conveniens for the purpose of determining the Setting Aside Application.

Stay Application

As the basis on which the 3^rd Defendant asked for the present action to be stayed was forum non-conveniens, the same considerations for determining the Setting Aside Application applied.

In the circumstances, both the Setting Aside and Stay Applications were dismissed by the Court.

Takeaway

The case of Fong Chak Kwan v Ascentic Ltd and another sets out extensively the legal principles governing the issue of forum conveniens and has provided us with useful summaries and insights as to previous case law. Employers should be reminded that they can be found liable by Hong Kong courts even if the work accidents take place outside of Hong Kong.