HKSAR v. LAM PING KAI

HCMA 383/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO. HCMA 383/2000

(On appeal from TWCC 1030/2000)

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JUDGMENT

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Introduction

1. On 7th March 2000 the Appellant was convicted after trial of one charge of conspiracy to defraud (1st Charge) and 19 charges of offering an advantage to an agent (2nd, 3rd, 4th, 5th, 6th, 7th, 8th, 12th, 13th, 14th, 15th, 16th, 17th, 18th, 19th, 20th, 21st, 22nd and 23rd Charges). He was sentenced to a total term of 18 months imprisonment. He now appeals against conviction and sentence.

2. Due to the constraint of time originally set aside for the appeal, the grounds of appeal were advanced in two stages; I heard the formal grounds of appeal against conviction on the original scheduled hearing day of 15th May 2001 and the substantive grounds at the resumed hearing day of 5th July 2001.

Brief facts

3. The prosecution case was that the Appellant was a director of Alpha-Chem Colours Limited ("Alpha-Chem") who was responsible for all operations of the company and for the supply and delivery of dyestuffs and chemical products to various dyeing factories in Hong Kong. Gloria Weaving And Knitting Factory Limited ("Gloria") was one of the customers of Alpha-Chem, which started to purchase dyestuffs and chemical products from Alpha-Chem in 1992.

4. YUNG Po-kau ("YUNG") and LEE Chi-leung ("LEE") were supervisors of Gloria. According to the written skeleton submission of the Respondent dated 14th May 2001, the Appellant was originally charged together with 8 other defendants who were the persons to whom he offered advantages in charges 2 to 23, and both LEE and YUNG had pleaded guilty and agreed to be prosecution witnesses. The charge sheet however shows that only LEE (who was named as D2) was charged with the Appellant and the prosecution offered no evidence against him on the conspiracy to defraud charge. There was no mention of YUNG on this charge sheet. Nevertheless, both YUNG ("PW1") and LEE ("PW4") gave evidence for the prosecution and there was evidence before the court that PW1 had pleaded guilty to one charge of conspiracy to defraud and 3 charges of accepting an advantage and was sentenced to 7 months imprisonment and was order to make restitution to Gloria (Appeal Bundle p. 139, para.9).

5. It was the prosecution case that in about January 1995, the Appellant, PW1 and PW4 agreed to create false purchases of dyestuffs and chemical products by Gloria from Alpha-Chem. Gloria would pay Alpha-Chem for the false purchases and the proceeds would be shared between the Appellant and PW1 and PW4. The Appellant created false sales from a fictitious firm called Tat Sang Hong Dyestuffs & Textile Auxiliaries in order to balance the books of Alpha-Chem. The fraud was carried out between January 1995 and May 1998 and a total amount of $481,213.40 was dishonestly obtained from Gloria (Charge 1).

6. Between January 1993 and December 1994, the Appellant agreed to offer advantages in the form of kickbacks to PW1 and PW4 for Gloria placing orders for the purchase of dyestuffs and chemical products from Alpha-Chem. The Appellant would calculate the amount of the advantage and upon receipt of payments by Gloria hand over cash to the PW1 and PW4 (Charge 2).

7. On various dates between December 1996 and May 1998 the Appellant offered advantages to PW1 (Charges 3-5) and PW4 for Gloria placing orders to purchase goods from Alpha-Chem (Charge 6).

8. On various dates between September 1993 and June 1998 the Appellant also offered advantages to employees of other companies for placing orders to purchase goods from Alpha-Chem on the same basis as he offered to the PW1 and PW4 (Charges 7 - 23).

Brief chronology

9. Before considering the various grounds of appeal, it is useful to set out briefly what has taken place.

* On 23rd June 1998, the Appellant was arrested.

* On 12th April 1999, the Appellant pleaded not guilty to all the 23 charges at the Tsuen Wan Magistracy.

* On 21st April 1999 the trial commenced before a permanent magistrate sitting at Tuen Mun. The defence complained of an "overloaded" charge sheet and asked the prosecution to elect to proceed on a reasonable number of charges. Further the defence applied to have the 1st charge deleted on the ground of misjoinder.

* On 22nd April 1999, the learned magistrate ruled against the defendant. The trial proceeded.

* On 23rd April 1999, the defence made a second application for severance on ground of prejudice or embarrassment. The application was refused. The trial continued.

* On 30th April, 1999, a third application for severance was made. Again the application was refused and the trial continued.

* On 21st May 1999, (day 23 of the trial), case adjourned part-heard as it exceeded the original estimate.

* On 30th August 1999, trial resumed (day 24). Case continued until 10th September when it was adjourned again.

* On 4th October 1999 (day 34) case resumed.

* On 14th October 1999 (day 41) the defence made an application for full disclosure of documents relating to the employment of the undercover ICAC agent (PW33) who had taped conversations she had with the Appellant during her employment with the Alpha-Chem.

* On 15th October 1999, the prosecution submitted that the files held by ICAC could not be disclosed on ground of sensitivity. Arguments lasted for 5 days.

* On 26th October 1999 (day 46), the learned magistrate ruled there was no such category of immunity known as "sensitive".

* On 27th October 1999, the learned magistrate granted the prosecution's application for a 2-week adjournment to obtain a public interest immunity certificate.

* On 15th December 1999 (day 48), prosecution produced the public interest immunity certificate signed by Mrs. Anson Chan, the Chief Secretary. Defence objected to the learned magistrate receiving such documents.

* On 21st December 1999, after hearing 3 days arguments on this issue, the learned magistrate ruled that the court had jurisdiction to determine ex-parte the prosecution's application for non-disclosure on ground of public interest immunity. The learned magistrate then proceeded to examine the documents the subject of the claim for public interest immunity.

* On 23rd December 1999 (day 53), he asked Mr. Liu, government counsel for the Respondent on this special issue, to assist him in his chambers. The learned magistrate then ruled, with some exceptions, that the documents were protected by public interest immunity. The defence applied for the learned magistrate to recuse himself on the ground that prejudicial documents had been placed before him in the absence of the Appellant, and for a permanent stay of the proceedings on ground of abuse of process by the prosecution. Both applications were refused.

* On 24th December 1999, the learned magistrate reviewed his decision after he learnt that one of the documents ruled to be under immunity had been disclosed to the defence already. Case adjourned for Christmas.

* On 29th December 1999, defence made an application for a permanent stay on grounds of material non-disclosure and non-timeous disclosure. The defence also alleged dishonest manipulation of the process of the court by the prosecution in that certain documents were deliberately suppressed.

* On 5th January 2000 (day 59), the learned magistrate refused the application.

* On 26th January 2000, (day 68) the prosecution closed its case. Appellant elected not to give or call evidence in his defence.

* On 29th January 2000, prosecution commenced its final submission.

* On 3rd February 2000, the defence made the final submission.

* On 3rd March 2000 (day 71), the learned magistrate started to deliver his verdict which took 3 days to complete.

* On 7th March 2000 (day 73), the Appellant was convicted of the 1st Charge of conspiracy to defraud and 19 charges of offering an advantage to an agent. The Appellant's application for bail pending appeal was refused by the learned magistrate.

* On 27th October 2000, the Appellant was granted bail pending appeal by Jackson J.

10. The learned magistrate's Statement of Findings came to 155 pages (Appeal Bundle pp.136-290). The learned magistrate also prepared a summary of evidence consisted of 57 pages for reference (Appeal Bundle pp.291-347). The transcript of proceedings made available for the appeal (which did not cover the whole trial) came to over 4,500 pages.

Grounds of Appeal against Conviction

Formal Grounds of Appeal against Conviction

11. Mr. James Chandler, appearing on behalf of the Appellant, advanced the following perfected grounds of appeal which were heard on 15th May:

(1) In the circumstances the Appellant's trial was rendered null. The twenty-two charges of offering an advantage pursuant to s.9 (2)(a) of Cap. 201 were improperly tried together with the first charge of conspiracy to defraud.

(2) In the circumstances the Appellant was deprived of a fair trial. He was charged in the Magistracy with twenty-two offences of offering an advantage to an agent pursuant to S.9 (2)(a) of Cap. 201, and one charge of conspiracy to defraud contrary to Common Law and S.159A of the Crimes Ordinance Cap. 200. The Prosecution refused Defence requests to reduce the number of charges to a number which would sufficiently reflect the Appellant's culpability in the event he was convicted. The Magistrate refused to order the prosecution to elect a sufficient number of charges that in the event of conviction would have adequately reflected culpability. In the circumstances the Appellant's trial was rendered manifestly oppressive.

(3) The Magistrate erred in declining on various occasions to exercise his discretion to order severance of charges with the result that the Appellant's trial which commenced on the 21st April 199[9] and did not conclude until the 7th March 2000 and involved over 70 sitting days was rendered manifestly oppressive. The Magistrate's refusal to accede to the various applications made on behalf of the Appellant for severance, at least as between the corruption and the fraud allegations, created injustice in that it resulted in the Defendant not giving evidence in support of his potential defence that he honestly believed that he had reasonable excuse to make the payments as alleged in the charges. That position was exacerbated by the Magistrate using against the Appellant contents of the Records of Interview with ICAC officers.

(4) The first charge of conspiracy to defraud alleged to have been committed both contrary to Common Law and S.159A of the Crimes Ordinance Cap.200 charged an offence unknown to law. The Magistrate erred in convicting the Appellant upon the first charge.

(5) The second charge of agreeing to offer an advantage contrary to S.9 (2)(a) of the Prevention of Bribery Ordinance Cap. 201 alleged an offence unknown to law. In the alternative as drafted the charge was duplicitous in nature. The learned magistrate erred in convicting the Appellant of the second charge.

12. Mr. Kevin Zervos for the respondent has very succinctly described what these grounds "when stripped of the emotive and extraneous comments boil down" to:

(1) The charge of conspiracy to defraud and the twenty-two charges of offering an advantage to an agent were improperly joined.

(2) The charge sheet containing twenty-three charges was overloaded.

(3) The magistrate should have exercised his discretion to sever the charge of conspiracy to defraud from the twenty-two charges of offering an advantage to an agent.

(4) The statement of offence for the charge of conspiracy to defraud was incorrectly described.

(5) The second charge of agreeing to offer an advantage to an agent was unknown in law and/or duplicitous.

Ground 1 - Misjoinder

13. In his ruling (Appeal Bundle p.689 line C to 691 line O), the learned magistrate had clearly relied on s. 10(2)(a) of the Magistrates Ordinance, Cap.227 when he ruled the joinder of charges justified. He referred to Rule 7 of the Indictment Rules and found that there was "sufficient nexus existing between" all charges. Applying the principle in R v Craig and others 53 Cr. App. Rep. 569 he considered the pros and cons of separate trials in the interest of the Appellant, the public and the prosecution and came to the conclusion that severance was not necessary. The relevant passage in R v Craig and others (supra) was cited by the learned magistrate (at p.689 line J):

"The offences should exhibit such similar feature as to establish a prima facie case that they can properly and conveniently be tried together in the interests of justice, which includes, in addition to interests of the accused, those of the prosecution witnesses and public. A further relevant factor is the prejudice likely to arise in the second trial from extensive press reports of the first trial if the offences are tried separately."

14. Mr. Chandler's main attack was that the learned magistrate's ruling was fundamentally flawed. He said the learned magistrate, in concentrating on the issues of 'nexus" that was relevant to deciding whether the offences "form or a part of a series of offences of the same or a similar character" failed to appreciate the difference between the requirement in the Indictment Rules on the one hand, and s.10 (2)(a) of the Magistrates Ordinance on the other. Further, the offence of conspiracy to defraud could not be said to be similar to offences under section 9(1) of the Prevention of Bribery Ordinance in that the elements/ingredients of each offence are totally dissimilar.

15. Mr. Zervos in his reply submitted that the charges were properly joined on the one charge sheet. He submitted that the underlying policy was that cases connected under s.10 (2)(a) of the Magistrates Ordinance should be heard together in the interests of due and expedient administration of justice and a concern for finality in criminal litigation. He submitted that the charges were of a similar character, in law and in fact.

Section s.10 (2)(a) of the Magistrates Ordinance, Cap.227 provides:

"(2) For every distinct offence of which any person is accused there shall be a separate complaint or information, and every such complaint or information shall be tried separately except in the following cases-

(a) when a person is accused of more offences than one of the same or a similar character he may, subject to the provisions of section 26, be charged with and tried at the same time for any such offence, whether it is committed with respect to the same person or not:

Provided that if the magistrate is of opinion that a person accused will be prejudiced or embarrassed in his defence, he may order a separate trial of any such charge or charges;"

and Rule 7 of the Indictment Rules, under the Criminal Procedure Ordinance, Cap. 227 provides:

"Subject to section 18 of the Ordinance, charges for any offences may be joined in the same indictment if those charges are founded on the same facts, or form or are a part of a series of offences of the same or a similar character."

16. Under s.10 (2)(a) of the Magistrates Ordinance a court needs to consider whether the offences are "of the same or a similar character" whereas under Rule 7 of the Indictment Rules it has to consider whether the offences "form or are a part of a series of offences of the same or a similar character." It is clear that the requirement under the Indictment Rules is more stringent than that under the Magistrates Ordinance.

In Ludlow v Metropolitan Police Commissioner [1971] AC 29, Lord Pearson, in his speech in the House of Lords, when dealing with Rule 3 of Schedule 1 to the Indictments Act, 1915 ("Rule 3"), which is equivalent to our Rule 7 of the Indictment Rules, said (at page 39) that both the law and the facts should be taken into account in deciding whether offences are similar or dissimilar in character. His lordship then said:

"In my opinion, however, it is important to notice that there has to be a series of offences of a similar character. For this purpose there has to be some nexus between the offence. .......when regard is had to the requirement of a series of similar offences it is right to look for a nexus. Nexus is a feature of similarity which in all the circumstances of the case enable the offences to be described as a series."

In R v Kray [1970] 1QB 125, the Court of Appeal, when dealing with Rule 3, said (at p.131):

"It is not desirable, in the view of this court, that rule 3 should be given an unduly restricted meaning, since any risk of injustice can be avoided by the exercise of the judge's discretion to sever the indictment. All that is necessary to satisfy the rule is that the offences should exhibit such similar features as to establish a prima facie case that they can properly and conveniently be tried together......."

17. The learned magistrate in making his ruling said (Appeal Bundle p.689 line C):

"The first issue the court has to determine is whether the charges are lawfully joined as they now appear. Joinder of offences, the relevant statute is section 10 of the Magistrates Ordinance. Under section 10 (2)(a), offences can be joined on the same charge sheet if they are of the same or similar character. This provision is similar to rule of the Indictment Rules and there are ample authorities saying that rule 7 of the Indictment Rules should not be given an unduly restricted meaning and there is no reason why the provision in section 10 should not be interpreted in the like manner.

In order to justify joinder of offences, it must be shown that a sufficient nexus exists between the offences......."

18. The learned magistrate, in looking for a nexus, had in fact imposed on himself a more stringent requirement. All the learned magistrate had to do was to look for similarity between the offences, both in law and in fact. In any event, the learned magistrate was of the opinion that there was a sufficient nexus existing as all the charges involved the Appellant and the company of Alpha-Chem and all charges involved commercial transactions or purported commercial transactions involving Alpha-Chem, and all charges involved the placing of purchase orders with Alpha-Chem. Applying the principle enunciated in R v Craig and others (supra), he held the charges properly joined and declined to sever them.

19. In my view, the learned magistrate's analysis of the similarity in facts between all the offences cannot be faulted. Although the legal elements/ingredients of a conspiracy to defraud charge are different from those required for a charge of offering an advantage to an agent, what was being alleged in the conspiracy charge was that the Appellant conspired with PW1 and PW4 to cheat "Gloria", the company for whom PW1 and PW4 worked, in relation to purported commercial transactions between Gloria and Alpha-Chem. Charges 2 to 6 concerned the Appellant offering advantages to PW1 and PW4 in relation to the placing of purchase orders by Gloria to Alpha-Chem. These offences were of a similar character in that they involved the Appellant together with PW1 and PW4 cheating Gloria in its dealings with Alpha-Chem. The similarity in legal characteristics is that one was concerned with the defrauding of Gloria and the other with the cheating of Gloria through the paying of bribes to agents of Gloria. The rest of the charges, though involving different personnel and different companies, were concerned with the Appellant offering advantages to agents of those companies so as to cheat those companies in their dealings with Alpha-Chem. The charges had been properly joined and there is no merit in this ground.

Ground 2 - Charge sheet overloaded

20. Mr. Chandler's contention was that the Magistrates Court is a court of summary jurisdiction to provide 'good swift justice'. The Appellant was convicted after a trial lasting 73 days. Following his arrest in June 1998 his liberty was restricted in that he could not go to visit his daughter in Canada. The Appellant incurred heavy legal costs and suffered severe mental pressure as a result of the matter hanging over his head for over 21 months. The prosecution rejected approaches from the Appellant's counsel to sever the case into manageable proportions. The learned magistrate also rejected formal applications for severance on a number of occasions. The trial was oppressive and the Appellant was therefore denied his right to a fair trial enshrined in Article 10 of the Hong Kong Bill of Rights and at Common Law.

21. Mr. Chandler referred to R v Novac (1976) 65 Cr. App. R. 107, R v Thorne and Others (1977) 66 Cr. App. R. 60, R v Bailey (1924) 18 Cr. App. R. 42, R v Kellard and Others (1995) 2 Cr. App. R. 134 to support his argument that it was the duty of a prosecuting counsel to ensure that the charge sheet was not overloaded, to withhold relevant evidence after reviewing evidence in a long case if the interest of time and clarity so requires to ensure a fair trial.

22. Mr. Zervos countered that the charge sheet was not overloaded. Of the 22 corruption charges, 21 involved specific individual offerings of an advantage by the Appellant to employees of ten customers who had commercial transactions with the Appellant's company Alpha-Chem. The trial was not before a jury. There was common evidence between the charges which were properly joined. The case was unnecessarily complicated and prolonged by the conduct of the defence and not by the nature of the number of the charges.

23. The learned magistrate when dealing with this application (Appeal Bundle p.690 line J - 691 line O) commented that the authority of R v Novac (supra) cited by the defence was different from the case at hand. That authority involved a jury trial. He was of the view that as the charges were properly joined, their number did not impose any difficulty in the management of the case or in dealing of the evidence by a professional tribunal. Further, the learned magistrate was of the view that the 23 charges were not more than necessary to reflect the culpability of the Appellant. He ruled that by trying these charges together there was not prejudice, injustice or oppression to the Appellant and the Appellant would not be embarrassed in any manner in his defence.

24. The case was originally set down for an 18-day trial. Although a trial involving 23 charges cannot be said to be commonplace in a Magistrates' Court, it does not ipso facto appear to be unduly long. The case badly over-ran and different areas needed to be investigated and arguments advanced due, to a large extent, to the stance taken by the defence throughout the trial; for instance, the numerous and repeated applications before the learned magistrate. I am not for one moment suggesting that the defence is not entitled to put the prosecution to strict proof and/or attack various aspects of the prosecution case. The defence, however, can hardly complain of the trial being prolonged when it was largely responsible for prolonging it. I find no merit in this ground.

25. As to the allegation that the learned magistrate had failed to evaluate evidence properly on each offence separately due to the volume of evidence before him, I will deal with that when I come to the substantive grounds of appeal.

Ground 3 - Severance of charges

26. The main contention advanced by Mr. Chandler, apart from the issue of misjoinder (which I have already dealt with), was that the Appellant was embarrassed or prejudiced in his defence in that the failure to sever deprived him of the opportunity to give evidence in support of his potential defence, i.e. that he honestly believed that he had reasonable excuse to make the payments as alleged in the corruption charges. Whilst accepting the principle in Zheng Wan-tai [2000] 1 HKC 627, Mr. Chandler relied on Wong Lap-kwong [1991] 1HKLR 52 to support his contention that the learned magistrate should have severed the charges.

27. Mr. Zervos submitted that whether to order separate trial or not was generally a matter of discretion. There was no basis to say that the learned magistrate had not exercised his discretion properly.

28. The relevant ruling of the learned magistrate can be found at Appeal Bundle p.196 line R to 198 line B. In Zheng Wan-tai (supra), the appellant therein was charged with handling stolen goods and importing unmanifested cargo. There was available a statutory "reasonable diligence" defence for the unmanifested cargo charge. One of the grounds of appeal was that the appellant was deprived of his right either not to give evidence or to give evidence in relation to only one offence when the judge did not sever the charges. The Court of Appeal, after considering Wong Lap-kwong (supra), said (at page 637) "[o]nly very rarely will this court interfere with the proper exercise of a judge's discretion ..."

29. The discretion to sever where the charges have been properly joined was given by the proviso to s.10 (2)(a) of the Magistrates Ordinance. A magistrate, in exercising the discretion, can order a separate trial if he/she is of the opinion that the accused will be prejudiced or embarrassed by his/her defence. Where a magistrate had properly exercised his discretion an appellate court will not likely interfere (see Zheng Wan-tai (supra)). Although Mr. Chandler submitted that Wong Lap-kwong (supra) (a decision by a single High Court Judge on an appeal from a magistrate) remains good law, not having been overruled by Zheng Wan-tai (supra) (which was a Court of Appeal decision), Wong Lap-kwong (supra) concerned the joinder of 'presumption' and 'non-presumption' charges, which was not the case here. The learned magistrate had in fact considered Wong Lap-kwong (supra) when the application was made. I see no basis to say that the learned magistrate had not exercised his discretion properly and sensibly in refusing to sever the charges. I see no merit in this ground of appeal.

Ground 4 - 1st charge unknown to law

30. Mr. Chandler submitted that the statement of offence of the 1st charge, alleging conspiracy to defraud contrary to both Common Law and s. 159(A) of the Crimes Ordinance, Cap. 200 was defective as it alleged an offence unknown in law.

31. The learned magistrate when dealing with this issue at trial (Appeal Bundle p.202 line E- 203 line D) came to the conclusion that the conspiracy to defraud charge was clearly one under the Common Law. Such an offence survived the statutory amendments to the law of conspiracy codified in amendments to the Crimes Ordinance. The reference to s. 159(A) was "mere excess verbiage" (Appeal Bundle, p.202 line Q).

32. Mr. Chandler submitted that the charge was defective, not null. As the learned magistrate did not amend the charge pursuant to s. 27 of the Magistrates Ordinance, which he had the power to do, the approach by the learned magistrate amounted to a material irregularity. In Fai Ma Trading Co. Ltd [1989] 1HKLR 582 where the defective information was not brought to the attention of the magistrate during the trial the Court of Appeal held that the correct approach was for the judge hearing the appeal to amend the information pursuant to the power under s.119(d) of the Magistrates Ordinance and for the amended information be heard de novo before a magistrate. Mr. Chandler submitted that as the learned magistrate was well aware of the defect and did not amend the 1st charge after full arguments, this court should not follow Fai Ma Trading Co. Ltd (supra) and the 1st charge should be quashed on this ground.

33. Mr. Zervos submitted that the conspiracy to defraud offence occurred between January 1995 and May 1998. During this time the Common Law offence of conspiracy was abolished and codified under the Crimes Ordinance on 2nd August 1996. The mention of s. 159(A) was an irrelevant reference which had no effect on the nature of the charge. There was no confusion about the nature of the offence being a conspiracy to defraud and it did not create any injustice to the Appellant.

34. In Attorney General v Wong Lau [1993] 1 HKCLR 257, Stock J (as he then was) reviewed a number of authorities (including R v Hamilton [1988] 1 HKLR 138, R v Williams (1990) 92 Cr App R 158, R v McLaughlin (1982) 76 Cr App R 42, R v Molyneux (1981) 72 Cr App R 111 etc.) together with the applicable statutory provisions, and distilled the following principles (at p.268):

"1. A distinction is to be drawn between informations that are defective and those which are nullities.

2. An information will be a nullity if

(i) the statutory provision creating the offences has been repealed and not re-enacted; or

(ii) the statement and particulars of offence cannot be seen fairly to relate to, or be intended to charge, a known and subsisting criminal offence; or

(iii) in some other way, it is so defective that it cannot be cured.

3. An information is not a nullity by reason only of the omission in the particulars of an essential ingredient of an offence.

4. If the particulars adequately describe an offence known to law, the information is not a nullity by reason only that the statutory provision creating the offence is wrongly stated or omitted.

5. An information is not a nullity if it describes a known offence, but with incomplete particulars.

6. Unless the defect is too trivial to call for amendment, a defective information must either be amended to cure the defect, or must be dismissed.

7. The powers to amend defective informations, conferred by s. 27 of the Magistrates Ordinance, extend to defects in substances as well as in form.

8. If the defect is not material, the magistrate is obliged by s. 27 of Magistrates Ordinance to cure it by amendment.

9. If the defect is material, the magistrate must nevertheless amend the information if no injustice will be caused by the amendment or if any such injustice can be cured by an order as to costs, or by other measures described by s. 27(2)(b) of the Magistrates Ordinance.

10. The power to order that further particulars be provided presupposes that the information already contains "such particulars as may be necessary for giving reasonable information as to the nature of the charge." Paragraph 3(3) of the Indictment Rules is intended, in my judgment, to provide a defendant with further details, and presupposes that particulars sufficient to "identify the transaction" or which "lift the [description] from the general to the particular", have already been provided in the information.

11. The requirement to particularise the "nature of the charge" is not fulfilled by describing the category or character of the offence. What is demanded is identification of the matter, the act, the transaction, in respect of which the charge is brought, such that the information or summons will "in itself be sufficient to identify with reasonable precision the act or acts with which [the defendant] is charged."

12. Informations which are a nullity cannot be amended.

13. Defective informations may be amended subject to any conditions prescribed.

14. Amendments, properly so called, are not subject to the provisions of s. 26 of the Magistrates Ordinance, since the power to amend presupposes a "live" information.

15. Where a magistrate exercises his power of amendment by the substitution of a new offence, then so long as the "matter" levelled against the defendant is the same, the substitution constitutes an amendment and not a new proceeding."

35. Having considered the relevant authorities and the submissions, I agree with the learned magistrate's finding that the reference to the statutory provision was 'mere excess verbiage' and I find the charge not defective. In the alternative, I find that the defect was too trivial to call for an amendment. If I were wrong about this conclusion, I would have ruled that such defect was immaterial and no injustice or prejudice had been caused to the Appellant whatsoever.

36. In CHING Kwok-yin v HKSAR [2000] 4 HKC 164, the Court of Final Appeal, dealing with an appeal from a magistracy, referred to s. 119(1)(d) and (e) of the Magistrates Ordinance and confirmed that there was no equivalent of s. 83 of the Criminal Procedure Ordinance therefore no proviso which required that the appeal be dismissed if no miscarriage of justice had occurred. The judge hearing the magistracy appeal could make such order as he/she thought just. He/she has to decide whether there has been an error in the magistracy which made it just that the appeal should be allowed and conviction set aside. If the 'defect' amounts to an error, it is so minor that I am of the view that this is not a case in which I should allow the appeal and set aside the conviction, notwithstanding the fact that the learned magistrate was expressly invited to amend the charge and declined to do so.

Ground 5 - 2nd charge a nullity

37. Mr. chandler submitted that by applying the principles enunciated in Wong Lau (supra), the 2nd charge of agreeing to offer advantage to an agent pursuant to s. 9 (2)(a) of the Prevention of Bribery Ordinance, Cap. 201 was an offence unknown to law and was a nullity which must be quashed. In the alternative an agreement to offer an advantage to two agents was duplicitous.

38. Mr. Zervos submitted that the offence under s. 9 (2)(a) of the Prevention of Bribery Ordinance was an offer of an advantage to an agent. Offer was defined under s. 2 (2)(a) of the said Ordinance and included a person who agrees to give an advantage. It is legitimate to have a charge of offering an advantage to an agent where the prosecution allege an agreement to give an advantage to an agent. The prosecution had particularised the charge here. The offence was not duplicitous as it alleged an offer of an advantage to two agents. The gravamen of the offence is the offer.

39. The learned magistrate, when dealing with this issue, said (Appeal Bundle p.221 line E):

"...While it was always desirable to follow the wordings used in the statute creating the offence and agreeing to offer and advantage could have simply been charged as offering an advantage I really did not see any objection for the prosecution to state in the statement and particulars of offence full particulars of their allegation. The charge would bring home to the appellant the exact allegation [he] was facing. This saved speculation and was helpful to the appellant.......The court was of the conclusion that the charge was legally in order and a valid charge."

40. Having considered the "definition" of nullity and defect mentioned above in Wong Lau (supra) I agree with the learned magistrate's view and reasoning that the charge was a valid one. The charge was not a nullity. I also accept the submission of Mr. Zervos that the charge was not duplicitous. I find no merit in this ground.

Substantive Grounds of Appeal against Conviction

41. I now turn to the substantive grounds of appeal advanced by Mr. Chandler:

(6) There was a material irregularity in the Appellant's trial in that, over the objection of the Appellant, the Magistrate, at the behest of the Respondent, during days 52 and 53 of the Appellant's trail held an Ex Parte hearing to determine whether or not certain non disclosed materials the subject of a claim to Public Interest Immunity should be disclosed to the Appellant. In the circumstances there was a denial of the Appellant's right to achieve a fair trial and an affront to the recognized principles of open Justice.

(7) The Magistrate erred in that in circumstances where it was demonstrated that documents that were not properly the subject of the claim for Public Interest Immunity and which contained extraneous comment, highly prejudicial and irrelevant material had been placed before him he refused the Appellant's Application that he should recuse himself from further hearing the Appellant's case.

(8) The Magistrate erred in that in ruling that he should not, in the exercise of his discretion, exclude evidence whether in whole or in part given by PW3[3] NG Siu-wai, an ICAC undercover operative he wholly failed to apply correct principles or took into account extraneous and irrelevant matters.

(9) The Magistrate erred in convicting the Appellant of the First charge of conspiracy to Defraud. The Statement of Offence in relation to that offence alleged that the Appellant and LEE Chi-leung conspired together with YUNG Po-kau to defraud Gloria Weaving [A]nd Knitting Factory Limited. There was no sufficient evidence to establish that the Appellant conspired together with LEE Chi-leung in terms of the charge. In fact the weight of evidence tended to negative the existence of such an agreement.

(10) The Magistrate erred in that he failed to consider the evidence available upon each individual charge separate from that available on any other charge. He adopted what was a flawed global approach to the evidence running together findings of fact in relation to individual charges.

(11) The Magistrate erred in that in the circumstances of the Appellant's case it was incumbent upon him to afford the Appellant the benefit of a full character direction. The Magistrate restricted his direction as to the Appellant's good character to propensity, omitting to address the issue as to how the Appellant's previous good character would impact upon his credit in relation to post arrest interviews with ICAC officers.

(12) In all the circumstances the Appellant's various convictions were unsafe and unsatisfactory.

42. Mr. Zervos has again succinctly put these grounds in simpler terms:

(6) The magistrate had no power to hear the prosecution's claim of public interest immunity ex parte in the middle of the trial.

(7) The magistrate should have discharged himself after the sight of some materials which had been placed before him during the [public interest immunity] application.

(8) The magistrate should have excluded in whole or in part the evidence of the undercover agent PW33.

(9) There was insufficient evidence to find that the Appellant had conspired with LEE Chi-leung as pleaded in the 1st Charge.

(10) The magistrate had not considered evidence on each charge separately.

(11) The magistrate should have given himself a full character direction.

(12) The conviction was unsafe and unsatisfactory.

Ground 6 - Ex Parte Public Interest Immunity application

Ground 7 - Learned magistrate wrong in failing to discharge himself?

43. These two grounds are so closely-related that it is more appropriate to consider them together.

Background

44. Before considering the merits of these two grounds, it is helpful to set out in some detail the relevant background. Incidents set out in the Chronology above from 14th October 1999 to 5th January 2000 are relevant and will not be repeated here.

45. The existence of the "Operational File" only became apparent during the cross-examination of PW33, the undercover agent. The Respondent acknowledged that documents contained in the Operation File were relevant to the issues before the court (i.e. whether the evidence of PW33 was admissible) and these materials "may even be prejudicial against him" (Appeal Bundle p.3607 line S - 3608 line B).

46. Despite numerous requests by the Appellant that material documents be disclosed the Respondent had failed to do so. The learned magistrate was of the view that the documents in question were all related to the planting of the undercover agent in the company of the accused and, as such, were relevant documents which should have been disclosed timely and properly instead of at a time when the trial had gone on for more than 50 days. After consideration, the learned magistrate was of the view that such failure did not amount to a "material irregularity" that could only be cured by an order to permanently stay the proceedings. (Appeal Bundle p.4253 line S). It could be remedied by recalling of relevant prosecution witnesses. The learned magistrate also ruled, with reference to Article 11(2)(b) of Bill of Rights, that the defendant had not been deprived of a fair trial.

47. As to the jurisdiction of a magistrate to hear the public interest immunity application, the learned magistrate considered the cases of R v South Worcestershire Justices, Ex p. Lilley [1996] 1 Cr App R 420, R v Stipendiary Magistrate for Norfolk, Ex p. Taylor [1998] Crim LR 276, and R v Bromley Justices, Ex p. Smith and Wilkins [1995] 2 Cr App R 285. He referred to R v Bromley Justices, Ex p. Smith and Wilkins (supra) which clearly stated that magistrate's court in the UK had the same jurisdiction to rule upon disputed issues as to disclosure of documents in summary proceedings as did a Crown Court judge in trials on indictment. The learned magistrate then said (at Appeal Bundle p. 3990 line G):

"I have checked through all the relevant legislation in the UK relating to the jurisdiction of the magistrate's Court and I cannot find any statutory provision giving the magistrate's court in the UK such jurisdiction. So, it must follow that such jurisdiction has developed through Common Law. And it is of no doubt that this part of the Common Law is applicable to Hong Kong."

After referring to AG v Ip Wai Kong [1982] HKLR 93, where Addison J (at p.100) dealing with an appeal from a magistracy, said that a "criminal court must have and has an inherent jurisdiction to make such orders as are necessary to ensure that justice is done" the learned magistrate continued to say (Appeal Bundle p. 3990 line Q):

"It is the view of the court that it would be absurd to say that such jurisdiction would be lost once the trial has started. The ultimate question to ask is whether it is still fair and just for the court to deal with the application ex parte when the trial has gone on for some time..........."

48. The learned magistrate further considered that no unfairness or injustice would be occasioned to the Appellant (at Appeal Bundle p. 3991 line D):

"The present case is being conducted by a legally qualified professional magistrate who is able to distinguish what is evidence and what is not evidence and what is admissible evidence and what is inadmissible evidence, and is able to determine the issue only on admissible evidence. It is the view of this court that a decision to deal with the application of the prosecution ex parte will not occasion any unfairness or injustice to the defence....."

The learned magistrate considered that the case of R v South Worcestershire Justices, Ex p. Lilley (supra) was confined to its own facts.

49. As to the issue of public interest immunity, the learned magistrate dealt with it in the following manner (at Appeal Bundle p.4005 line C):

"It is an exercise for this court to balance the public interest immunity against the right of the accused to relevant material which the accused has contended that they are essential to the proper conduct of its defence. ...the court has an important role to play to ensure that the rights of the accused are protected. If I should find any document or material capable of casting doubt on the guilt of the accused or capable of avoiding a miscarriage of justice or such that the materials are essential to the conduct of the defence of the accused, then the balance would weigh heavily towards disclosure."

50. The certificate from the Chief Secretary (Exhibit 249, Appeal Bundle pp.2627-2631) contained two schedules of documents in respect of which public interest immunity was claimed. In schedule A under serial no. 2 the following document dated 21st April 1998 was listed: Internal communication - approval for undercover operation ("Internal communication") (Exhibit p. 250B, Appeal Bundle pp. 2638-2642). Paragraphs 3 - 11 (with the headings of "Resources Implication"; "Execution and Command"; "Surveillance Support"; "Other Support"; "Review Mechanism"; "Contingency Plan"; "Legal Advice", "Morals/Ethics"; and "Liaison with other agencies") were obliterated.

51. During the ex parte hearing on 23rd December 1999, the learned magistrate invited Mr. Liu, counsel for the prosecution (Respondent) called in for the public interest immunity application, to render assistance to him in his chambers. The hearing lasted for almost an hour. Immediately following the ex parte hearing the learned magistrate ruled (Appeal Bundle p.4005 lines I):

" I have studied all the documents very carefully and I sought assistance from Mr. LIU and I am satisfied in this balancing exercise that these documents, with some exceptions, should be protected under [Public Interest Immunity] as set out in the certificate of the Chief Secretary and should be withheld from disclosure...".

52. The Internal communication was among those ruled to be withheld from disclosure. Following the said ruling the Respondent confirmed that the said Internal communication (with the obliteration) had, prior to the submission to the Chief Secretary, been disclosed to the defence. The learned magistrate then exercised power pursuant to section 104 of the Magistrate Ordinance and reviewed his decision, ruling that the Respondent had waived privilege in respect of the Internal communication.

53. The fact that the learned magistrate had sighted the whole document is beyond dispute. Mr. Liu disagreed with Mr. Chandler's contention that the learned magistrate should have been given an edited version (Appeal Bundle p.4018 line T). The learned magistrate also confirmed that he had sighted another document couched in similar terms dated 20th February 1998 (referred to as "operational Orders" by the learned magistrate). The learned magistrate refused the Appellant's invitation to recuse himself from the trial and he had this to say (at Appeal Bundle p.4046 line I):

"In dealing with the ex parte application, the court has to consider whether the edited parts in these two orders should be protected under [public interest immunity], or otherwise. There is no way that the court can exercise its function and discharge its duty in this aspect fairly and properly without looking at the whole of the operational orders. Paragraph 1 and 2 in the two operational orders are, therefore, in this sense not extraneous comments or irrelevant revelation.

These two paragraphs do contain information which is prejudicial to the accused, but they are relevant to the proper consideration by this Court in the issue of public interest immunity, in relation to these two operational orders. The court is of the view that what the prosecution have done does not amount to abuse of judicial process."

Jurisdiction to hear ex-parte application

54. It is common ground that magistrates in Hong Kong do have the power to regulate the practice and procedure in the magistrates courts and to adapt the procedures to contemporary needs: see R v Camberwell Green Magistrates' Court, Ex p. Christie (1978) 67 Cr. App. R. 39; Chief Constable of Norfolk v Clayton (1983) 77 Cr. App. R. 24; and AG v Ip Wai-kwong (supra).

55. Mr. Chandler's argument was that in the UK, the magistrates' courts power to entertain ex parte applications in relation to issues of disclosure was regulated by statute, the learned magistrate was therefore in error when he concluded that his jurisdiction to hold an ex parte hearing was founded in the Common Law. Whilst accepting that the magistrates' courts have jurisdiction to determine ex parte the issue of disclosure, Mr. Chandler contended that such hearing must be heard prior to the trial. He submitted that the requirement of open justice and the express provisions of sections 11 and 19 of the Magistrates Ordinance Cap.227 required that all facets of the Appellant's trial be conducted in open court and in his presence. Mr. Chandler prayed in aid Articles 10 and 11 of the Hong Kong Bill of Rights and submitted that the procedure adopted by the learned magistrate wholly disregarded the Appellant's rights enshrined in the said Bill of Rights.

56. Mr. Chandler also referred to three decisions by the European Court of Human Rights: Rowe and Davis v U.K. (Application No. 28901/95, Jasper v U.K. (Application No. 27052/95) and Fitt v U.K. (Application No. 29777/95), all reported in Times Law Reports 1st March 2000 and submitted none of these applications support the "extreme position" adopted by the learned magistrate. He submitted that the course adopted by the learned magistrate amounted to a material irregularity in the Appellant's trial.

57. Before turning to the response of the Respondent, it is convenient here to set out the relevant provisions in the Magistrates Ordinance. Section 11 of the Magistrates Ordinance provide as follows:

"11. The room or place in which a magistrate sits to hear and try any complaint or information shall be deemed an open and public court, to which the public generally may have access, so far as the same can conveniently contain them, unless the magistrate otherwise directs where the evidence is of an indecent character, or where a prosecution is for an offence against the Societies Ordinance (Cap 151) and is an offence relating to or otherwise connected with a Triad Society, in which case he shall make a note on the depositions of the direction which he has given:

Provided that in any case the delivery by the magistrate of his determination and any proceedings subsequent thereto, other than a review under section 104 which requires the hearing of evidence, shall take place in open and public cour.";

and section 19(1) and (2) of the Magistrates Ordinance provide:

"19(1) Where the defendant is present at the hearing, the substance of the complaint or the information (or the summons which has been issued under section 8 pursuant to such complaint or information) shall be read over to him, and explained if necessary, and he shall be asked whether he admits or denies the truth of the complaint or information. If the defendant admits the truth of the complaint or information, his admission shall be recorded as nearly as possible in the words used by him, and the magistrate shall convict him or make an order against him accordingly; but it he does not admit the truth of the complaint or information as aforesaid, then the magistrate shall proceed to hear upon oath the complainant or informant and such witnesses as may be produced in support of the complaint or information, and also to hear the defendant and such evidence as may be adduced in defence and also to hear and examine such other witnesses as the complainant or informant may examine in rebuttal, if the defendant or his counsel has examined any witnesses or given any evidence other than as to the defendant's general character.

(2) The magistrate, having heard what each party has to say and the witnesses and evidence so adduced, shall consider the whole matter and determine the same, and shall convict or make an order against the defendant or dismiss the complaint or information, as the case may be."

58. Mr. Alex Lee, arguing on behalf of the Respondent at the resumed hearing, submitted that both these sections were general in nature; section 11 dealt with general access made to the public while section 19 was a general provision as to the manner of trial in the Magistrates' Courts. These provisions did not deal with the special circumstances of a claim of public interest immunity in the Magistrates' Court, he submitted. The Respondent submitted that where the prosecution rely on Public Interest Immunity or sensitivity to withhold material the procedure to be followed was that given in R v Davis [1993] 1 WLR 613 and R v Bromley Justices, Ex p. Smith and Wilkins [1995] 2 Cr App R 285. As a public interest immunity application is exceptional, the presence of the defendant would render such an application impracticable and rather defeats the purpose: see R v Keane [1994] 2 All ER 478 and R v Malvern Justices, Ex p. Evans and another (1988) 87 Cr App R 19. There was an inherent power to order a hearing to be held in camera, even though there is an express provision that proceedings shall be held in open court.

59. The nature of public interest immunity application was put in these terms by Lord Bingham CJ in R v Stipendiary Magistrate for Norfolk, Ex p. Taylor [1998] Crim LR 276 (the full judgment was downloaded from Lexis for my reference) (at p. 3 of the judgment):

"I turn therefore to the question of public interest immunity applications in criminal trials. These arise where the Crown hold material relevant, or potentially relevant, to a prosecution which they are unwilling or reluctant to disclose to the defence on the ground that to do so would be seriously injurious to the public interest. The difficulty arises because any procedure for determining whether the material should be disclosed to the defence has necessarily to be conducted in a manner which conflicts with the general and important principle that justice should be administered openly with cards face upwards on the table and with the full knowledge of the defence as well as the prosecution."

60. The UK courts have devised rules to meet such difficulties. In R v Davis [1993] 1 WLR 613, the court sets out the procedure to be followed. It is recognised that the substance of the material cannot be disclosed until there is an order for its disclosure. There might be exceptional cases when it is necessary to deny the defence the knowledge that an ex parte application had been made.

61. Although the Magistrates Court is a creature of statute it is accepted that magistrates do have the power to regulate their own courts to ensure justice is done. Whether the learned magistrate was correct in holding that his jurisdiction arose from Common Law is neither here nor there. I do not see why a magistrate should cease to have jurisdiction to determine a public interest immunity application ex parte once the trial has started. Sections 11 and 19 of the Magistrate Ordinance are general provisions stipulating that generally all the proceedings should be conducted in open court and in the presence of the defendant. However, as so clearly stated by Lord Bingham CJ in R v Stipendiary Magistrate for Norfolk, Ex p. Taylor (supra), public interest immunity applications need "to be conducted in a manner which conflicts with the general and important principle that justice should be administered openly...". I am aware that in R v Stipendiary Magistrate for Norfolk, Ex p. Taylor (supra) the justices heard the matter inter-parte with the applicant's solicitor present but the applicant and another defendant excluded from the hearing. That particular fact does not alter my view already expressed. I hold that the learned magistrate did have the jurisdiction to consider the public interest immunity application ex parte during the trial.

Learned magistrate should have recused himself?

62. Mr. Chandler submitted that the learned magistrate had erred in ruling that the Internal communication was properly before the court. Such document had been disclosed to the defence and was wholly extraneous to the issue whether documents identified in the Chief Secretary's Certificate were protected from disclosure. Having sighted such highly prejudicial and irrelevant material the learned magistrate should have discharged himself from further hearing the trial. He contended that the fact that the learned magistrate was a professional magistrate was not a relevant consideration when he was asked to recuse himself. The correct test was whether there was a real danger of bias as propounded in R v Gough [1993] AC 646, at 670E:

"Accordingly, having ascertained the relevant circumstances, the court should ask itself whether, having regard to those circumstances, there was a real danger of bias on the part of the relevant member of the tribunal in question, in the sense that he might unfairly regard (or have unfairly regarded) with favour, or disfavour, the case of a party to the issue under consideration by him;............"

Such a test was followed in Hong Kong in the case of Nattrass v A. G. [1996] 1 HKC 480 and R v HO Chiu-hung, MA No. 359 of 1996.

63. Mr. Chandler submitted that though in normal circumstances it is appropriate for the tribunal determining issues of disclosure to continue to hear the case there are exceptional cases where the tribunal should recuse itself. He referred to the judgment of Rose LJ in R v South Worcestershire Justices, Ex p. Lilley (supra) (at 424):

" ...there may, in exceptional cases, be circumstances in which hat which had been ruled admissible is of so highly prejudicial a character, that as a matter of fairness and appearance of fairness a differently constituted bench ought properly to conduct the trial and an application to that effect could, in such exceptional circumstances, be expected to succeed......"

Mr. Chandler submitted that in the present case, "extraneous" matters had been brought to the notice of the learned magistrate so he should have recused himself from further hearing the trial. Mr. Chandler relied on the case of R v Stipendiary Magistrate for Norfolk, Ex p. Taylor (supra) where Lord Bingham CJ and Buxton J considered the said judgment of Rose LJ. Both Lord Bingham CJ and Buxton J accepted what Rose LJ had said as a general statement, commenting that it was a situation unlikely to arise. Lord Bingham CJ said (at page 5 of the judgment downloaded from Lexis):

"It would seem to me a situation only likely to arise in relation to extraneous comment or some irrelevant revelation, should such be made.";

and Buxton J said (at page 7 of the judgment):

"......Such cases may therefore in practice be confined to cases where matter has been introduced at the public interest immunity hearing which was not only prejudicial but also irrelevant to proper consideration of admissibility"

64. The submission of the Respondent was that cases of Gough (supra), Nattrass (supra) and HO Chiu-hung (supra) relating to 'bias' dealt with wholly different factual scenarios to the present case and were therefore not applicable. The learned magistrate could not properly considered the public interest immunity application without examining the documents. It was submitted that professional magistrates are often asked to rule on the admissibility of incriminating material and they are trusted to be able to put such incriminating material out of their minds should such be ruled inadmissible. The same principle should apply here. In any event, Mr. Lee submitted that the Appellant failed to discharge his burden of showing that there was a real danger of bias on the part of the learned magistrate, whether deliberate or subconscious.

65. The governing law on the question of bias is now to be found in R v Gough [1993] AC 646, in particular the speech of Lord Goff, with which all their Lordships concurred (at p.670):

"In conclusion, I wish to express my understanding of the law as follows. I think it possible, and desirable, that the same test should be applicable in all cases of apparent bias, whether concerned with justices or members of other inferior tribunals, or with jurors, or with arbitrators..................Furthermore, I think it unnecessary, in formulating the appropriate test, to require that the court should look at the matter through the eyes of a reasonable man, because the court in cases such as these personifies the reasonable man; and in any event the court has first to ascertain the relevant circumstances from the available evidence, knowledge of which would not necessarily be available to an observer in court at the relevant time. Finally, for the avoidance of doubt, I prefer to state the test in terms of real danger rather than real likelihood, to ensure that the court is thinking in terms of possibility rather than probability of bias. Accordingly, having ascertained the relevant circumstances, the court should ask itself whether, having regard to those circumstances, there was a real danger of bias on the part of the relevant member of the tribunal in question, in the sense that he might unfairly regard (or have unfairly regarded) with favour, or disfavour, the case of a party to the issue under consideration by him;............"

66. It is clear that the test propounded has been adopted by the courts in Hong Kong: see Nattrass (supra) and HO Siu-hung (supra). I have to consider whether there existed such a "real danger of bias" on the part of the learned magistrate in the particular circumstances of this case. Before considering this issue, it will be appropriate to consider if indeed "extraneous" and "irrelevant" yet "highly prejudicial" matters had been brought to the attention of the learned magistrate.

67. A distinction has to be drawn between what is relevant and what is admissible. Not all relevant matters are admissible. In the present case the Internal communication formed part of the basis why an undercover agent was deployed. What was contained in the Internal communication was of course hearsay and not admissible in court. However, such information would have been relevant to the issue of the deployment and the defence was entitled to have such matter disclosed to them. The learned magistrate had made it clear that he had read the whole document (including the obliteration) so the whole un-obliterated document had been placed before him for consideration. It is true that the said document had been disclosed to the defence, but it is also true that such disclosed document had parts of it obliterated. What the Respondent should have done was to ascertain from the defence whether their application for "full disclosure" include those obliterated parts of the document. There is, in my view, some basis for the suspicion that the left hand did not know what the right hand was doing, so far as the Respondent was concerned. However, faced with a demand for full disclosure, it was necessary for the Respondent to place the whole document before the learned magistrate when the Respondent sought non-disclosure on the ground of public interest immunity. The learned magistrate had given reasons why he considered paragraphs 1 and 2 of the Internal communication relevant to the issue before him. I see no reason to fault his reasoning. I am satisfied that those two paragraphs (and similar paragraphs in a similar Internal communication) were relevant to the issue of public interest immunity and not extraneous or irrelevant matter.

68. I now have to decide whether there was unfairness involved. There is no dispute that the defence had persistently asked for the disclosure of material. The learned magistrate had ruled that there had been untimeous disclosure. It is common ground that the defence was taking issue as to the admissibility of the evidence of the undercover agent (PW33). Any document in relation to her deployment should have been disclosed to the defence (unless public interest immunity was claimed). There was obviously no consideration by those concerned regarding public interest immunity until the eleventh hour, hence the production of the relevant certificate after an adjournment was sought. Mr. Chandler submitted that, in fairness to the Appellant, the prosecution should have opted not to rely on the controversial evidence of PW33 instead of pursuing public interest immunity application at such a late stage. The learned magistrate had dealt with this issue during the trial. He had found there was no abuse of the process by the prosecution and no unfairness or injustice. He emphasized that he was a professional magistrate who could separate admissible from inadmissible evidence. I see no cause to fault his decision.

Any real danger of bias?

69. Magistrates have been asked to rule from time to time whether incriminating evidence is admissible. A classic example is one where the evidence is relevant but its prejudicial effect outweighs the probative value. In making the relevant ruling, the magistrate obviously has to examine the evidence in question. Magistrates are trusted to be able to put such incriminating material out of their minds should they rule it inadmissible. As indicated by Lord Bingham CJ in R v Stipendiary Magistrate for Norfolk, Ex p. Taylor (supra), there should not be any distinction drawn between judges who are trained as lawyers and lay magistrates. The learned magistrate is a permanent magistrate who was trained as a lawyer. There is no reason to doubt him when he said that he could and would disregard inadmissible evidence which he came to know. This is not a case in which the exceptional situation envisaged by Lord Bingham CJ occurred. There was no Wednesbury unreasonableness.

70. Although Mr. Chandler submitted that there was a likelihood that the learned magistrate was subconsciously influenced by the fact that the trial had gone on for over 50 days when he refused the Appellant's application to recuse himself, the test remains whether there was a real danger of bias for the learned magistrate to remain in the case. In the words of Lord Bingham CJ in R v Stipendiary Magistrate for Norfolk, Ex p. Taylor (supra) it was "unnecessary, in formulating the appropriate test, to require that the court should look at the matter through the eyes of a reasonable man" the court has to "ascertain the relevant circumstances from the available evidence". After considering all the circumstances I find that the Appellant failed to show that there was a real danger that the learned magistrate was biased against the Appellant and I find no merits on this ground.

Ground 8 - Evidence of undercover agent not excluded

71. In February 1998 the ICAC decided to deploy an undercover agent in the Appellant's business and PW33 was employed as an Accounts clerk in the Appellant's business from 27th April 1998 until 23rd June 1998, the date of the Appellant's arrest.

72. PW33 operated a tape recorder and recorded all her conversations with the Appellant. The prosecution sought to produce 3 of those tape recordings:

* 1st May 1998 (exhibit P.232AA), (Appeal Bundle p. 2201-2278);

* 5th May 1998 (exhibit P. 233AA), (Appeal Bundle p. 2372-2450); and

* 23rd June 1998 (exhibit P.234AA) (Appeal Bundle p. 2527-2529).

The learned magistrate ruled (Appeal Bundle p.4529 line D - 4531 line F) the various tape recordings and ancillary documents admissible and declined to exercise his discretion to exclude them. The learned magistrate ruled that as the Appellant was engaged in the commission of ongoing offences it was legitimate for the ICAC to have infiltrated PW33 into the Appellant's business. Although the undercover agent had admitted that an object of the operation was to obtain evidence of past criminal activities of the accused, the learned magistrate found that that did not automatically render the evidence obtained to be tainted with unfairness as it was not the undercover agent's sole object to obtain admissions or confessions from the Appellant. The learned magistrate indicated that he had considered he factors referred to in R v Smurthwaite and Gill (1994) 98 Cr. App. 437 and found no unfairness (see Appeal Bundle p. 4531 line F, note also that the transcript has wrongly cited the case as "Smirth Waite and Gill").

73. Mr. Chandler submitted that the learned magistrate had erred in that he failed to properly identify the factors that went to the exercise of his discretion as to whether the tapes and ancillary documents should have been excluded from evidence. There had been unfairness as there was a derogation of the Appellant's right to silence.

74. Mr. Chandler complained that the learned magistrate "moved from a finding that the investigatory technique was legitimate to a conclusion that the evidence gathered during the currency of that investigation was not tainted by unfairness" and he failed to take into account factors relevant to whether the Appellant's right to silence had been unfairly disturbed. Mr. Chandler referred to the factors listed to R v Smurthwaite and Gill (supra). He also referred to Secretary for Justice v LAM Tat-ming and Another [2000] 2HKC 693, a Court of Final Appeal decision not available to the learned magistrate at the time of the trial. He submitted the relevant principles applicable to the present case were "whether the Appellant had applied himself to the deception", "whether the admissions were in relation to past or ongoing offences", "how passive or active was the role of the undercover operative" and "whether there had been an attempt to circumvent the provisions of the Secretary for Securities Rules and Directions for the Questioning of Suspects". Mr. Chandler submitted that the conduct of the undercover agent in bringing a set of calculations to the Appellant for his confirmation acted as a catalyst to engage the Appellant in conversation which resulted in the taped conversation dated 1st May 1998 (see Appeal Bundle p. 3543 line L - 3545 line D). Mr. Chandler complained that the learned magistrate's failure to exercise his discretion to exclude that evidence and his subsequent reliance on such evidence created unfairness to the Appellant.

75. In his reply Mr. Lee submitted that the law recognized the use of undercover operations as "an essential weapon in the armoury of the law enforcement agencies". He referred to Lam Tat-ming (supra), R v Jelen and Katz, (1990) 90 Cr App R456, and R v Christou and Wright [1992] 1QB 979 and submitted the use of the undercover agent was proper in this case. There was no suggestion that the undercover agent provoked, incited or encouraged the Appellant to commit any crime. There was no entrapment. There was no reason to require the learned magistrate to exclude PW33's evidence. As to Mr. Chandler's submission that the conduct of PW33 in bringing the set of calculations to the Appellant for confirmation acted as a catalyst, Mr. Lee submitted that judging from the transcript of the taped conversation PW33 played a very passive role, merely answering "yes" or "Mm" in response most of the time.

76. First of all, I disagree with Mr. Chandler that the learned magistrate had 'moved from a finding that the investigatory technique was legitimate to a conclusion that the evidence gathered during the currency of that investigation was not tainted by unfairness". The learned magistrate had clearly indicated that he had considered the factors listed in R v Smurthwaite and Gill (supra) and found no unfairness. Although the learned magistrate had not listed those factors in his ruling there is no reason to doubt him when he said he had considered them. The factors listed are as follows (p.440 of the judgment):

"......Was the [undercover] officer acting as an agent provocateur in the sense that he was enticing the defendant to commit an offence he would not otherwise had committed? What was the nature of any entrapment? Does the evidence consist of admissions to a completed offence, or does it consist of the actual commission of an offence? How active or passive was the officer's role in obtaining the evidence? Is there an unassailable record of what had occurred or is it strongly corroborated? In Christou and Wright [supra] this Court held that discussions between suspects and undercover officers, not overtly acting as police officers, were not within the ambit of the Codes under the 1984 Act. However, officer should not use their undercover pose to question suspects so as to circumvent the Code. In Bryce [supra] the Court held that the undercover officer had done just that. Accordingly, a further consideration for the judge in deciding to admit an undercover officer's evidence, is whether he has abused his role to ask questions which ought properly to have been asked as a police officer and in accordance with the Code."

77. The Court of Final Appeal decision of LAM Tat-ming (supra) only came into existence in June 2000 so the learned magistrate did not have the benefit of this particular decision when he made his ruling. The Court of Final Appeal dealt with the question concerning the scope of the judge's residual discretion to exclude a voluntary confession made by an accused to a law enforcement officer when the accused was not under arrest or in custody and was unaware he was making an admission to an officer. The Court of Final Appeal recognised the need to have undercover operations in law enforcement which necessitated concealment of the true identity of the law enforcement officer (at p.704). (It should be made clear that Mr. Chandler never challenged the need for undercover operations.) The Chief Justice, delivering the judgment of the Court of Final Appeal, reviewed Hong Kong, UK, Australian and Canadian authorities in this area. The Chief Justice said (at 702 and 703):

" The judge has the overriding duty to ensure a fair trial for the accused according to law....."

"The requirement of a fair trial for the accused involves the observance of principles including the following which are relevant in this appeal: (1) No man is to be compelled to incriminate himself, his right of silence should be safeguarded. (2) No one can be convicted except upon the probative effect of admissible evidence. To ensure a fair trial for the accused, the court will exclude admissible evidence the reception of which will compromise these principles: R v Sang ...."

78. The Court of Final Appeal held that the court may exclude voluntary and admissible evidence if the right of silence of the accused has been infringed. The Chief Justice said (at p.705 of the judgment):

"....In the context of an undercover operation involving a suspect, when could it be said that his right of silence is infringed? In answering this question, the law has to apply to practical commonsense.

Where the undercover officer plays a passive role and hears or overhears the confession or records it, there can be no basis for rejecting it....

The real problem arises where the undercover officer plays an active role in procuring the confession from the suspect by asking questions. If it were not an undercover operation, the suspect would have to be cautioned reminding him of his right of silence and enabling him to make a choice whether or not to speak. With an undercover operation, this obviously could not be done. In this situation, once the officer actively questions the suspect, we enter into an area which may engage the exercise of the residual discretion.

How it should be exercised will depend on what follows. If all the officer does is to draw attention to the incident which gives rise to the offence charged, in the absence of any other relevant circumstances, there is no persuasive reason for excluding a confession made. The officer is doing no more than providing an opportunity for the suspect to speak. If however what the officer does amounts to interrogation, the discretion would ordinarily be exercised so as to exclude the confession. Such an interrogation would constitute a derogation of the accused's right of silence and thus prejudice his fair trial. Whether the conversation amounts to interrogation would have to be determined having regard to all the circumstances...."

and, further (at p.706):

It is necessary to emphasis that the residual discretion is a judicial discretion which is to be exercised in a principled way. But the occasions where its exercise may come to be considered will involve a wide variety of facts and circumstances. Ultimately, the courts will have to apply the proper approach in a commonsense way.'

79. Although PW33 brought the calculation to the Appellant (Appeal Bundle p.3544), I disagree with Mr. Chandler's contention that the undercover agent was active in leading the Appellant to making admissions. I agree with Mr. Lee's submission that the undercover agent played a very passive role. It her role is somehow considered to be active, then the most one can say is that by bringing the calculation to the Appellant she had brought the Appellant's attention to the matter which later led to the admission. I find nothing reprehensible in the conduct of the undercover agent.

80. It is true that the learned magistrate did not specifically refer to the issue of derogation of the Appellant's right of silence in his consideration, but his reference to the factors in Smurthwaite and Gill (supra) indicates that he did in fact consider the relevant factors. There is no basis, on the evidence before the learned magistrate, to say what had transpired between the Appellant and the undercover agent amounted to an "interrogation" by the undercover agent. The learned magistrate had exercised his discretion in a principled manner and I find no merits in this ground.

Ground 9 - Insufficient evidence to prove conspiracy between the Appellant and LEE Chi-Leung in 1st Charge?

81. The Statement of Offence of 1st charge read as follows:

"LAM Ping-kai and LEE Chi-leung together with YUNG Po-kau, between the month of January 1995 and the month of May 1998, in Hong Kong, conspired together to defraud Gloria Weaving And Knitting Factory Limited by dishonestly:......"

82. Mr. Chandler submitted that because of the way the Statement of Offence was drafted the prosecution had to prove that the Appellant conspired together with LEE to defraud Gloria, and 'extrinsic to that' there had to be proof that they together conspired with YUNG to carry out the same criminal purpose. Mr. Chandler submitted that while there was direct proof that the Appellant conspired with YUNG, there was no sufficient evidence to prove that the Appellant conspired with LEE or LEE conspired with YUNG. LEE when giving evidence testified that the prosecution had offered no evidence against him in respect of a Conspiracy to Defraud in similar terms to the 1st charge. In the absence of direct evidence the learned magistrate relied on circumstantial evidence. Mr. Chandler submitted that such circumstantial evidence was equally explainable upon the basis that LEE was involved in the receipt of a share of the corrupt payments identified in the 2nd to 6th charges.

83. Mr. Lee submitted that the learned magistrate addressed the issue whether there was an agreement between the Appellant and PW1 and PW4. He rightly observed what was said in R v Griffiths in respect of what constitute an agreement. He submitted that it was not necessary to prove there was a direct agreement between the Appellant and PW4.

84. The learned magistrate ruled (Appeal Bundle p.203 line Q):

"211. .......With due respect I did not see how it could be said that the charge as framed alleged a chain conspiracy. It was only plain language meaning simply that the appellant, PW1 and PW4 conspired together. The important thing was that the charge should only alleged one conspiracy between the appellant, PW1 and PW4. What the prosecution had to prove was that all 3 of them were part of the same agreement.

In R v Griffiths it was said, "all must join in the one agreement, each with the others, in order to constitute one conspiracy. They may join at various times, each attaching himself to that agreement; any one of them may not know all the other parties, but only that there are other parties; any one of them may not know the full extent of the scheme to which he attaches himself..."

The learned magistrate then dealt with the evidence of PW1 and PW4 and came to the following conclusion (Appeal Bundle p. 205 line C):

"Although PW4 might not know the full extent of the scheme the evidence available show clearly that he was one of the parties to the agreement. It was of no doubt that the appellant, PW1 and PW4 were all parties in the same agreement."

85. Although no submission was made on this, when one looks at the "Consent to prosecution under Section 31" (Appeal Bundle p. 69), it can be seen that consent was given "to the institution of the prosecution of [the Appellant] and LEE Chi-leung". That may be the reason (or partly the reason) why the Statement of Offence was drafted in such a way. Whatever was the reason for the rather unfortunate wording in the Statement of Offence, I am in total agreement with the view of the learned magistrate. This is clearly a case of wheel conspiracy and the learned magistrate was fully entitled to draw the inference on the evidence before him. I agree with Mr. Lee's submission that the learned magistrate's findings cannot be faulted. I find no merit in this ground.

Ground 10 - Flawed global approach?

86. Mr. Chandler submitted that the learned magistrate did not assess or did not appear to have assessed the evidence available on each individual offence separately. He complained of "cross fertilization of evidence". Mr. Chandler cited the following instances as examples. In respect of Charge 13 on the issue of lawful authority and reasonable excuse (Appeal Bundle p.254 line L):

"The court has already discussed about the state of mind of the appellant accused in making payments to various people when the court dealt with Charge 2. The discussion and the finding of the court in respect of this issue in Charge 2 were applicable here as far as they [were] relevant. The finding of the court is that the appellant did not have any lawful authority or the reasonable excuse to make the payment to Luk, and he did not believe that he had such lawful authority or reasonable excuse."

In respect of charge 18 on the same issue (Appeal Bundle p.269 line Q):

"His state of mind was such that he did not care whether WAN had the authority, and even if he knew that WAN did not have such authority he would still pay him the money. The state of mind of the appellant in making payments to various people had been discussed when the court dealt with Charge 2. The discussion and finding of the court in the issue of lawful authority and reasonable excuse in Charge 2 were applicable here as far as they were relevant."

87. Mr. Chandler referred me to R v Bailey (supra) where Hewart LCJ said at p.46:

"In the present case that course was not taken, nor in the present case were the jury directed to weigh, and to weigh with care, the evidence with reference to each particular charge, being careful not to fall into the error of supplementing the evidence on any one charge by what might erroneously be conceived to be helpful evidence upon some other charge."

Mr. Chandler submitted that it was illegitimate for the learned magistrate to making findings adverse to the Appellant in relation to the 2nd charge and to "import" those to a different charge.

88. Mr. Lee submitted that there was no basis for this ground. He referred me to the learned magistrate's oral reasons for the verdict (Appeal Bundle pp.514 - 570) and his Statement of Findings (Appeal Bundle pp.202-286), submitting that the learned magistrate had considered the evidence of each charge separately. Although reasonable excuse was a defence to the corruptions charges, one must not forget that the defendant chose, which was his rights, not to give evidence. The learned magistrate had considered the issues of lawful authority, reasonable excuse and the state of mind of the Appellant and drawn inferences (Appeal Bundle pp.224-226). He had adopted what he had said in Charge 2 for convenience sake.

89. The learned magistrate had indeed considered each charge separately as submitted by Mr. Lee. He had carefully considered the issue of lawful authority and reasonable excuse by examining the state of mind of the Appellant when the Appellant gave money to various people in these proceedings (Appeal Bundle p.224 line D). Although the finding was placed under the heading of Charge 2 it is clear that such finding is not confined to Charge 2. I am satisfied the learned magistrate adopted a "short-hand" way of dealing with the statement of findings so as not to repeat himself time and again. There is no basis to suggest that there was cross-fertilization and I find no merit in this ground of appeal.

Ground 11 - Inadequate character warning

90. Mr. Chandler complained about the learned magistrate's approach to the answers given by the Appellant in Record of Interview. The learned magistrate disbelieved the Appellant's answers which were potentially exculpatory but gave full weight to potentially inculpatory ones without giving any reasons for the difference in approach. In giving himself a character direction directed solely to propensity, Mr. Chandler submitted that the learned magistrate had tailored such character direction to such circumstances where he had made up his mind to disbelieve the Appellant in respect of his potentially exculpatory answers. Mr. Chandler relied on opinion of Bokhary P.J. in TANG Siu-man v HKSAR [1998] 1 HKC 371, submitting that the present case required the learned magistrate to give a character direction composing both limbs.

92. Mr. Lee submitted that it was not necessary for a professional magistrate to give directions on both limbs, particularly when the defendant chose not to give evidence. The Record of Interview was a "mixed statement" and the exculpatory answers carried less weight than inculpatory ones. TANG Siu-man v HKSAR (supra) refers to directions to jury as to how to make use of common sense. The old-fashioned way of directions shown in Vye was criticized.

93. Mr. Lee also, as an alternative, relied on Ching Kwok Yin v HKSAR (supra). Assuming that the learned magistrate was duty bound to give such a direction, would he have nevertheless convicted? Mr. Lee submitted that as three of the Appellant's former employees gave evidence; there was no allegation that the undercover agent was not a credible witness; and three of the acceptors of advantages also gave evidence, the learned magistrate would nevertheless had convicted even if he had given himself a character direction on credibility because the evidence was overwhelming. He emphasised that the Court is concerned with the justice of the case.

94. In TANG Siu-man v HKSAR (supra), Bokhary P.J., giving the dissenting judgment, said (at page 403) :

"If an accused of good character has given evidence or relies on the exculpatory parts of a mixed statement, the judge should give the jury both limbs of the good character direction. Under the first limb, the jury should be told that the accused's good character is to be taken into account in his favour when they decide the weight to give to what he said in the witness-box or to the exculpatory parts of the mixed statement. That is the 'credibility' direction. And under the second limb, the jury should be told that the accused can rely on his good character as making it more unlikely than otherwise that he would commit crime, as the prosecution alleges he did. That is the 'propensity' direction.

If an accused of good character neither gives evidence nor relies on the exculpatory parts of any mixed statement, then only the propensity direction should be given."

95. The learned magistrate's ruling on the voir dire can be found at Appeal Bundle pp. 198-200. The Appellant did not give evidence during the voir dire. After the learned magistrate ruled the evidence admissible, the Appellant elected, which is his right, not to give evidence during the trial proper. There is nothing to show that the Appellant had relied on the exculpatory parts of the mixed statement. Even if I were to accept the dissenting opinion of Bokhary P.J. the Appellant could not bring himself within the ambit of that ruling. All the learned magistrate needed to do, which he did, was to give himself a 'propensity' direction. However, one must not forget the actual judgment given by Litton P.J. (with whom Li C.J., Ching P.J., and Sir Daryl Dawson N.P.J. agreed) in that case. The learned judge said (at p. 380 line B):

"...These are not directions on law which a jury is bound to follow. They relate to evidence which, at the end of the day, is the province of the jury. However entrenched these rules might be in the criminal justice system they can amount to nothing more than an indication of the way the jury might properly make use of the evidence..."

and later (at 384 line G)

" A jury is invariably told by the trial judge...that in viewing the evidence they must use common sense. Implicit in this statement is that proposition that in weighing up credibility the jury must have regard, as best they can, to the character of the person standing in the witness-box; and in determining guilt or innocence, the disposition of the defendant, in so far as there is material bearing upon such disposition..."

96. Applying the principle enunciated, all the learned magistrate had to do was to employ common sense when he considered the guilt or innocence of the Appellant. When dealing with a mixed statement when the accused does not give evidence, a magistrate need to evaluate both the inculpatory and exculpatory parts of the statement: R v Sharp [1988] 1 WLR 7 and R v Leung Kam-kwok [1986 HKLR 181. In The Queen v Leung Tung-wing [1995] 2HKCLR 271, Stuart-Moore J (as he then was), giving judgment of the Court of Appeal, referred to the passage by Lord Roskill in R v Leung Kam-kwok (supra) (at page 274):

"....if an accused person in a statement not made on oath in Court denies his guilt,.............that statement is not evidence of the truth.....But if such a statement consists partly of an admission and partly of an explanation .....the admission is plainly admissible and common fairness requires that the entirety of the statement should be admitted so as to show the precise context in which the admission was made, even though what is said by way of explanation or excuse is not evidence of its truth. Where the accused goes into the witness box and repeats the explanation or excuse on oath there is no problem. Where he does not go into the witness box it behoves the trial judge, when dealing in his summing up with the admission, in common fairness to the accused, also to refer to the accompanying explanation or excuse, adding if he thinks fir to do so that that explanation or excuse has not been supported by evidence on oath before the jury. It is then for the jury to evaluate the admission and the unsworn explanation or excuse as they think fit."

97. The Appellant did not go into the witness box to repeat the exculpatory parts of the Record of Interview. In rejecting those parts of the Records of Interview the learned magistrate had clearly placed no weight on such exculpatory matters which were untested by cross-examination. The learned magistrate is not duty-bound to give himself a good character direction on credibility. All he had to do was to use common sense to evaluate the evidence. The learned magistrate was meticulous in his evaluation of the evidence. I find no merit in this ground.

Ground 12 - Unsafe and unsatisfactory verdicts?

98. This is really a catchall provision. Since I have ruled against the Appellant on each and every ground advanced I do not see any basis to say that the convictions are unsafe and unsatisfactory.

Judgment on Appeal against Conviction

99. For the reasons I have given, the Appellant's appeal against conviction is dismissed.

Appeal against Sentence

100. Mr. Chandler frankly admitted that the sentences imposed by the learned magistrate on the various charges were neither wrong in principle nor excessive. His submission centred on the conduct of the trial, saying that the trial was protracted and oppressive to the Appellant. Mr. Chandler also drew my attention to the fact that the Appellant had served part of his sentence and had been allowed bail pending outcome of his appeal.

101. Mr. Lee's contention was that the length of the trial was the Appellant's own making. Prosecution needs to prove its case beyond reasonable doubt. The fact that the Appellant had served part of his sentence and then put on bail is not a ground for suspending the sentence.

102. Mr. Chandler has very fairly conceded that the sentences could not be said to be wrong in principle or manifestly excessive. Having considered all the arguments advanced, including those in pursuit of the appeal against conviction, I see no basis to suspend the sentence imposed. The fact that the Appellant was granted bail pending appeal is not a consideration. The nature of the appeal was such that it has taken a long time for this court to dispose of it. That is not, however, a ground to suspend the sentence imposed.

Judgment on Appeal against Sentence

103. The Appellant's appeal against sentence is also dismissed.