HKSAR v. ULITZKA JORG HEINZ

HCCC 487, 488 and 498/2014, and 10, 38, 74, 259, 310 and 368/2015

[2018] HKCFI 763

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 487 OF 2014

(ARISING FROM TWCC NO 1881 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 488 OF 2014

(ARISING FROM TWCC NO 1215 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 498 OF 2014

(ARISING FROM TWCC NO 1023 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 10 OF 2015

(ARISING FROM TWCC NO 1776 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 38 OF 2015

(ARISING FROM TWCC NO 2398 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 74 OF 2015

(ARISING FROM TWCC NO 3037 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 259 OF 2015

(ARISING FROM TWCC NO 3280 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 310 OF 2015

(ARISING FROM TWCC NO 3419 OF 2014)

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IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 368 OF 2015

(ARISING FROM TWCC NO 658 OF 2015)

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REASONS FOR DECISION

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Introduction

1.  This group of drug trafficking cases all arise from an international joint operation, known as “Operation Cocoon”, involving the Hong Kong Customs and Excise Department, the US Immigration and Customs Enforcement and the Australian Federal Police.  The cases have a number of common characteristics and issues but what is a predominant concern to the defendants is disclosure of material by the authorities involved which may support their claim that they did not know they were transporting drugs as they had been tricked and groomed into getting involved by drug traffickers. 

2.  I have had a series of pre-trial hearings to address this and other matters but the situation has now reached the point where the defendants make application to be released on bail.  It is therefore necessary to provide a brief account of what has happened to date. 

Defence submissions

3.  It is claimed that each of the defendants fits the profile of person that the drug traffickers would target and groom to transport drugs.  It is submitted that the targeted persons generally live a socially isolated existence and in most cases are single and/or elderly and are therefore likely to be easily influenced or cajoled.  This appears to have been given credence by public comments made by relevant law enforcement officers involved in the operation that international drug syndicates had targeted certain vulnerable persons and tricked them into transporting drugs to arranged destinations. 

4.  Mr Gerard McCoy, SC, and Mr Michael Arthur, assigned by the Legal Aid Department for the defendants by a memorandum to the Court dated 15 July 2015 noted that they had been in custody for a considerable period with little progress being made for disclosure of material in light of what was known about their cases.  It was noted that the cases all had certain common features.  Each defendant faced a single count of trafficking in a large quantity of methamphetamine hydrochloride, commonly known as Ice.  Each defendant was arrested at the Hong Kong International Airport and the drugs were found concealed in his or her luggage.  Each defendant was about to depart for Australia except one for New Zealand.  Each defendant, it was claimed, had been tricked into coming to Hong Kong as a result of emails or internet grooming by a drug trafficking syndicate.  Each of the defendants, it was claimed, had no knowledge of the drugs.  The defendants range in age from 43 to 78 and have had no history of any prior involvement in the drug trade. 

5.  There appears to have been public statements from representatives of the relevant law enforcement agencies involved in this operation about the modus operandi of the drug syndicates involved to the effect that they would groom vulnerable people to carry drugs to Australia.  It is claimed that certain related cases have been dropped and the reason or reasons for doing so is of particular relevance to the defendants in defending the charge that they each face.  In a related case, HKSAR v Kummerfeld, HCCC 395/2014, a female defendant aged 82, had her case dropped on 30 April 2015 after nearly a year in custody. It is suggested that the reason for dropping the case may be relevant to the defendants’ cases but the prosecution have stated that it was on medical evidence that the decision was taken not to proceed with the prosecution.

Mention hearings

6.  A mention hearing was convened on 5 August 2015 in relation to eight cases arising from the operation.  The prosecution as requested provided in relation to each case a brief case statement together with relevant particulars of the charge and an update as to the situation with unused material.  In this regard, it had been specifically requested that the prosecution provide details of any relevant information relating to the defendants arising from the operation.  A statement dated 4 August 2015 was provided by the Assistant Commissioner of Customs and Excise in which he addressed the public statements he had made in relation to the operation.  As far as material he said:

“4. During my report, I said the Operation was a joint operation amongst the Customs and Excise Department in Hong Kong (hereinafter referred to as the Department), U.S. Immigration and Customs Enforcement, and the Australian Federal Police. It was started in 2014 to tackle transnational methamphetamine trafficking. In this Operation, retired persons, involving European, American and Australian, were found smuggling methamphetamine to Australia. Retired and aged persons were asked through email messages saying something like, ‘You have an estate for collection in Hong Kong’. The email would also say something like, ‘We would provide you passage and accommodation for free for you to come to Hong Kong.’

5. Once in Hong Kong, there was in fact no estate to collect.  After certain simple document signing, the retired persons would be given free passage and accommodation again to take a suitcase to Australia.  Some of them agreed to do so.  Inside the suitcase were about one to two kilogrammes of methamphetamine.  The concealment method of the methamphetamine was simple and the drug was just put inside a suitcase, rucksack or handbag.  Some methods were more sophisticated by using reeling drums with methamphetamine contained inside.  Some used decoder or electrical equipment to put the drug inside and then put inside a suitcase.  I also said that in the Operation, we detected 10 drug traffickers from Europe, United Stated and Australia who came to Hong Kong and attempted to take methamphetamine with them to Australia.  Among the 10 arrested persons, the youngest was aged 45 and the oldest 82.  Out of them, 7 aged over 65 and all were retired persons.”

7.  It is principally on the basis of the public statements and what is now known about Operation Cocoon that Mr McCoy submits that the relevant law enforcement agencies involved appear to be in possession of material relating to the operations of the drug syndicate or syndicates in targeting and grooming vulnerable persons to be drug mules. 

8.  A further mention hearing took place on 1 September 2015 to follow up on these issues and to ensure that full and proper disclosure was being made to the defendants.  It was also noted that an additional case of HKSAR v Walsh, HCCC 386/2015 was to be included in the group of cases. 

Disclosure issue

9.  Prior to the hearing on 23 September 2015, the Prosecutions Division of the Department of Justice informed the legal representatives of the defendants by letter dated 11 September 2015 the following:

“I also confirm that meetings have been held with the representatives of the Australian Federal Police and the US Immigration and Customs Enforcement and after an explanation of the Prosecution’s duty of disclosure and the issues, assurances have been given that there is no material which bears on the question of your respective client’s knowledge of the dangerous drugs seized nor any material which would confirm or otherwise, that they had been tricked into carrying the same, held by these organisations.

The material which bears or may bear on both of these issues is contained in the material already supplied to you, either in the Committal Bundle or the further material which was contained in the phones computers and i pad seized from the respective Accused.”

10.  Mr McCoy complains that in light of the public comments and the information so far provided there appears to be material relating to the operations of the syndicate or syndicates and how they targeted and groomed potential couriers generally as well as the defendants specifically.  Mr David Leung, SC, for the prosecution, has indicated that the position of the Prosecutions Divisions is as stated in the above letter but he acknowledges that further inquiries will be made in light of matters raised in the hearing and this could take some time to address either way.  This means that the cases set down to be heard this year will have to be vacated. 

11.  The prosecution have a duty of disclosure which is part of a defendant’s fundamental right to a fair trial.  It requires the prosecution to make full and timely disclosure to the defence of all relevant or possibly relevant material available or known to it whether it is here or abroad.  In general terms, it is material that may in some way advance the defence case or weaken the prosecution case.  It is not enough to say that inquiries have been made and to leave the matter there.  I have to agree with Mr McCoy that there appears to be in existence information or material relating to the operations of the syndicate or syndicates involved in these drug trafficking cases that would be relevant to the defence in how the individual defendant was targeted and groomed to become a drug courier.  This seems to be evident from the public statements that have been made by members of the joint operation.  The prosecution are therefore on notice to take all reasonable steps to identify and obtain such material.  In the course of the mention hearings and from the exchange of correspondence between the parties enough has been said for the prosecution to know exactly what material it needs to make sure should be disclosed.

12.  I have fixed a further mention hearing for 10am on 23 October 2015 to monitor the progress of the disclosure issue.  The parties have no objection to the question of disclosure being addressed as a preliminary issue by me even though I may not be the trial judge in each and every case.

Defendants’ cases

13.  Subject to the disclosure issue, most cases could or should be ready for trial as scheduled.  It appears that in each case the prosecution has not served a witness statement accounting for the actions from receipt of intelligence to the arrest of the defendant.  I am informed that a witness statement has been served on the Prosecutions Division but is pending legal advice. 

14.  Ms Eberhard’s trial (HCCC 498/2014) is fixed for the 5 October. Her medical condition will not permit her to stand trial on this date.  The trial dates are therefore vacated. 

15.  Mr Toner’s trial (HCCC 488/2014) is fixed for the 9 October.  The defence would be ready to commence the trial but because of the disclosure issue the trial dates are vacated and I direct that the case be brought on as soon as possible in 2016. 

16.  Mr Ulitzka’s trial (HCCC 487/2014) is fixed for the 3 November.  The defence would be ready to commence the trial but because of the disclosure issue the trial dates are vacated and I direct that the case be brought on as soon as possible in 2016. 

17.  Mr Un’s trial (HCCC 10/2015) is fixed for the 18 November.  There are medical records relating to the defendant to be obtained from the United States which will need to be studied by a specialist in Hong Kong.  This I am informed would delay the start of the trial and the defence would not be in a position to commence the trial until these matters have been fully investigated.  Mr Un has been placed under assessment at the Siu Lam Psychiatric Centre but is presently detained in Lai Chi Kok Reception Centre.  The trial dates are therefore vacated.

18.  Mr Teutscher’s trial (HCCC 38/2015) is fixed for the 11 December. I am informed that there are medical issues to be explored in relation to this defendant and there is likely to be the need to obtain overseas evidence.  This could delay the start to his trial and the defence would not be in a position to commence the trial until these matters have been fully investigated.  The pre-trial review fixed for 30 September and the trial dates are therefore vacated.

19.  Ms Luu’s trial (HCCC 74/2015) is fixed for the 18 January 2016.  I am informed that the defence could be ready to commence the trial on that date. There is a pre-trial review fixed for 12 November.

20.  Mr Clifford’s trial (HCCC 259/2015) is fixed for the 8 August 2016. A pre-trial review is also fixed for 23 June 2016.  I am informed that the defence would be ready to commence the trial on that date.  I direct however that all reasonable efforts be made to fix an earlier trial date.

21.  Mr Moorman’s trial (HCCC 310/2015) does not yet have a fixture.  

22.  Mr Walsh (HCCC 368/2015) was committed for trial on 11 September and there is no fixture for his trial.  

Issue of bail

23.  I will now address the issue of bail. 

24.  The principles of bail I have addressed in HKSAR v Vu Thang Duong, HCMP 249 and 477/2015, dated 16 March 2015, unreported, where I said:

“13. Bail is the conditional grant of liberty to a person suspected of committing or alleged to have committed a criminal offence.  A defendant’s right to bail is enshrined in Article 5(3) of the Hong Kong Bill of Rights Ordinance, Cap 383, which addresses the liberty and security of persons.  The material part states that “… it shall not be the general rule that persons awaiting trial shall be detained in custody, but release may be subject to guarantees to appear for trial…”.  The right to bail is premised on the presumption of innocence and the entitlement to an early trial.  The fundamental objective of bail is to ensure that the defendant appears at his trial and that the public are protected from further offences in the meantime.  Although there are specific provisions that authorise the granting of bail in the courts, the question of bail is primarily governed by Part 1A, sections 9C to 9Q, of the Criminal Procedure Ordinance Cap 221. 

14. Section 9G(1) provides:

‘The court need not admit an accused person to bail if it appears to the court that there are substantial grounds of believing, whether or not an admission were to be subject to conditions under section 9D(2), that the accused person would –

(a) fail to surrender to custody as the court may appoint; or

(b) commit an offence while on bail; or

(c) interfere with a witness or pervert or obstruct the course of justice.’

15.   The section creates a rebuttable presumption in favour of bail and where it appears to the court that an accused would fail to comply with the conditions set out in section 9D(2) then bail may be refused and in forming that view the court may have regard to the matters set out in section 9G(2) which are as follows:

‘a) the nature and seriousness of the alleged offence and, in the event of conviction, the manner in which the accused person is likely to be dealt with;

b) the behaviour, demeanour and conduct of the accused person;

c) the background, associations, employment, occupation, home environment, community ties and financial position of the accused person;

d) the health, physical and mental condition and age of the accused person;

e) the history of any previous admissions to bail of the accused person;

f) the character, antecedents any previous convictions, if any, of the accused person;

g) the nature and weight of the evidence of the commission of the alleged offence by the accused person;

h) and any other thing that appears to the court to be relevant.’

16.   The relevant provisions allow the court to take into account a range of relevant matters when deciding whether or not to grant bail.  The presumption of bail can be rebutted by the nature of the offence, the risk of danger to the public, or the likelihood that the trial could be affected by the defendant absconding or influencing a witness.  An unreasonable delay in custody, in the particular circumstances of the case, may be a factor in favour of bail.  Of course, such a factor would be taken into account together with all other relevant factors in deciding whether or not to grant bail.”

25.  The prosecution does not object to bail for any of the defendants subject to suitable conditions being attached which include:

1) residence at a particular location and with notification to be given to the Police in writing at least 24 hours before of any change of residential address;

2) reporting once a week to the Police;

3) surrender of all travel documents and not to apply for any replacement travel documents; and

4) not to leave Hong Kong.

26.  It is proposed that all the defendants, except for Mr Toner, will reside at the Siu Hing Hostel, Jordan and report to the Tsim Sha Tsui Police Station. Mr Toner will reside at the Grand City Hotel and report to the Western Police Station. 

27.  Even though the prosecution have not objected to the grant of bail for the defendants I still have to be satisfied that it is firstly appropriate to grant the individual defendant bail and if I do so decide, secondly, what terms and conditions should be imposed if any.  In the course of the hearing and upon inquiry, I was informed that some of the defendants have a prior criminal record.  In the cases of Mr Toner and Mr Moorman, they were relatively minor offences that were committed a long time ago and when they were young.  I therefore did not consider they had a bearing on the question of bail.  In the case of Mr Teutscher, I was informed that he has a number of previous convictions in the Netherlands for dishonesty and forgery, including false passports.  I therefore adjourned his bail application to today in order to give the defence an opportunity to obtain instructions and seek any clarification about these matters.

28.  In relation to the other cases, I decided to grant bail to the defendants notwithstanding they were apprehended with a large quantity of drugs in their possession.  It is clear from the account that I have given of these cases that there are matters that need to be explored to determine the extent to which each and every one of them was knowingly involved in the transportation of the drugs found in their possession.  It is also clear that given their backgrounds and circumstances that on the whole they are persons of hitherto good character who may have either naïvely or unwittingly got involved in a very serious crime.  There is the outstanding issue of disclosure of material that may, and that is the highest it can be put at this stage, assist the defendants in supporting their claimed defence.  Overall I do not consider in light of the background of each of the defendants, that they are a flight risk and in the unusual circumstances of these cases, I am prepared to grant them bail subject to the terms and conditions as proposed.

29.  At the adjourned hearing, it is submitted by Mr Arthur on behalf of Mr Teutscher that the matters disclosed are not a record of any prior convictions and are in the nature of intelligence which are denied.  He acknowledges that his client has a prior conviction in Germany in relation to the opening of a bank account for which he was fined.  He also points out that he has mental health issues and is undergoing psychiatric assessment.  Mr Leung, for the prosecution, has been unable to clarify the situation with regards to Mr Teutscher’s criminal record, but has no objection to bail being granted with additional reporting conditions.  I am prepared to grant Mr Teutscher bail on this basis and in addition to the other terms and conditions as proposed, I order that he report every Tuesday, Thursday and Sunday of each week between the hours of 9 to 11 am. 

30.  All the defendants are bailed to appear at the next mention hearing fixed for 10 am on 23 October 2015.