THE QUEEN v. CHANDRA THANWARDAS MIRCHANDANI

Bill of Rights - s.11 (2) (d) - legal assistance - whether anything in the Legal Aid in Criminal Cases Rules (Cap. 221 Sub.leg.) as amended by L.N. 199 of 1992 is inconsistent with Bill of Rights - whether Court of Appeal has power to grant legal aid notwithstanding rule 12(2) of the Rules.

[The Queen v. Fu Yan, Criminal Appeal No. 490 of 1991, 23rd may 1992 (not yet reported) considered.]

Judgment handed down: 28th July 1992

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J U D G M E N T

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[Application for legal aid]

Fuad, V.-P.:

1. This matter comes before us in a form stated to be an application by Mr. Chandra Thanwardas Mirchandani ("the applicant") for legal aid under the Hong Kong Bill of Rights Ordinance, Cap. 383.

2. Mr. Mirchandani was arrested in the USA and after an unsuccessful battle against extradition lasting over two years, he was extradited to Hong Kong. After a lengthy trial in the High Court before O'Connor, J. and a jury, he was, on 2nd April 1990, convicted (upon unanimous verdicts) of all the offences charged in the 35 counts in the indictment. Nineteen counts related to uttering forged documents, while the remaining 16 counts concerned false accounting. He was sentenced to concurrent terms of 8 1/2 years' imprisonment-on each count. In addition he was ordered to pay a fine of $10 million on counts 1, 7 and 14 with a 12 months' default sentence in respect of each fine. Thus if the convictions and sentences are maintained on appeal, and if he pays none of the fines so that all the default sentences are activated, the applicant will serve a total term of 11 1/2 years' imprisonment.

3. When passing sentence on 20th June 1990, O'Connor, J. noted that the applicant had obtained just over HK$92 million from various banks by misleading them as to the existence of certain commercial transactions. While some of this money had been recovered by way of set off, some HK$82.5 million remained owing to the banks.

4. Mr. Mirchandani has applied for leave to appeal against his convictions and sentences, and the hearing of those applications was adjourned to await the outcome of the present proceedings. He also filed an application for leave to apply for judicial review in relation to the same convictions. Barnett, J. determined the application without a hearing (as permitted by the Rules of the Supreme Court) and refused the relief sought. We understand that an appeal is pending against that_.decision.

5. In respect of the trial, the applicant was originally granted legal aid on 17th May 1988. The legal aid certificate was discharged on 24th June 1988. Following renewed applications, legal aid was again refused on 8th July 1988 and 26th January 1989. An affidavit sworn on 21st January 1992 by Mrs. Dorothy Pritchard, Assistant Principal Legal Aid Counsel, informs us that the discharge and the subsequent refusals were all based on the fact that the Director of Legal Aid was not satisfied that the applicant's disposable resources did not exceed the amounts stipulated in the applicable law. She annexed a copy of her letter dated 15th January 1992 to the applicant, which concludes:

" It has been made very clear to you by various members of this Department over a number of years that you have to satisfy the Director as to your financial resources. Equally it has always been made clear to you why the Director has not been satisfied as to your means. You have also been told that if a satisfactory explanation of the various matters in contention was forthcoming then the Director could look at the matter again. This course has always been and still is open to you. Despite this not only have you never tendered any satisfactory explanation or in some instances any explanation at all, regarding the points at issue - after receiving Mr. Goodman-Smith's letter of the 16th June 1989 you requested that the chapter be closed 'For once and for all'."

6. On the same grounds, on 7th December 1990, the Director refused the applicant legal aid in respect of his application for leave to appeal against his convictions and sentences.

7. Meanwhile, on 10th October 1990 the applicant had been adjudged bankrupt. This is what Mrs. Pritchard says about that in her affidavit:

"5. I am informed that a Receiving Order has been made in Hong Kong against the Appellant. However I am not aware of what matters were disclosed by the Appellant to the Official Receiver nor am I aware whether the matters relating to assets touched upon in this Affidavit were investigated by the Official Receiver. It is for the Appellant to satisfy the Director that his Bankruptcy was based upon full disclosure. This he has failed to do."

8. We also have before us a "declaration" by the applicant, made before a Commissioner for Oaths and dated 30th November 1991, in which he states the grounds upon which he is applying "for legal aid under the Bill of Rights":

"1) That under the Bill of Rights Article 11, which I believe states that everyone charged with criminal offences has the right to legal assistance of their own choice, that he is entitled to legal aid for his appeal.

2)That I have lost my trial because legal aid was refused and myself being layman could not defend as no knowledge of legal issues.

3) That my trial was long which lasted about 4 months and for this there are 3,783 trial transcript pages and I believe in order to make a proper presentations of perfected Grounds of Appeal some legal experts would have to read and understand between the lines.

4) The summation of the learned judge presiding over the trial is very lengthy and complicated one and if I were to prepare the perfected grounds myself the number of grounds might exceed the number of pages of summation as according to my first reading everything seems to me either prejudicial or learned judge had erred or have had exceeded in His Lordship's summation to the jury.

                    5) That I have absolutely no funds.

6) That in the summary procedure of the bankruptcy court dated 10th October, 1990 in Bankruptcy Case number B23 of 1990 in the High Court of Hong Kong item (ii) which reads:

'The debtor Chandra Thanwardas Mirchandani be and is hereby adjudged bankrupt'

7) That I make this declaration conscientiously believing the same to be true and virtue of the Oaths and Declaration Ordinance."

9. When invited to address us, Mr. Mirchandani maintained his assertion that he had no means with which to pay for the legal representation he said he needed for the preparation and conduct of his application for leave to appeal against conviction and sentence.

10. On 1st July 1992 certain amendments to the principal and subsidiary legislation which governs legal aid came into force. I refer, in broad terms, merely to the amendments which concern the matter before us:

(a)    The Legal Aid (Amendment) Ordinance 1991 (Ord. 27 of 1991) amended the principal Ordinance (Cap. 93) so that eligibility for assistance is now determined on the basis of the applicant's financial resources and not, as hitherto, on the basis of disposable income and capital. A new upper limit is set.

(b) By a provision added to the existing Rules by the Legal Aid in Criminal Cases (Amendment) Rules 1992, the Director is given a new discretion to grant legal aid for a criminal trial or appeal even though the applicant's financial resources exceed the prescribed limit.

11. The Crown Solicitor (in my view, very properly) wrote to the applicant on 9th July suggesting that, in the light of these amendments, he might wish to make a fresh application for legal aid to the Director. Mr. Mirchandani went along with this suggestion and on 16th July the Director again refused to grant him legal aid.

12. I now refer to those provisions of the legislative scheme relating to legal aid in criminal cases which seem to me to be relevant. I have set out a provision, where appropriate, in its amended form (as from 1st July 1992).

13. The Legal Aid in Criminal Cases Rules (Cap. 221 sub. leg.) have been made by the Chief Justice under the enabling powers given by section 9A of the Criminal Procedure Ordinance, Cap. 221. That section allows him, with the approval of the Legislative Council, to "make rules for the granting of legal aid in criminal cases to persons of limited means ...".

14. The material part of rule 4 is as follows:

"4(1) Subject to any requirement to make contributions under Part III -

. . . . .

(c) a person convicted of any offence before the High Court or the District Court may be granted legal aid under these rules for any appeal to the Court of Appeal and in any proceedings preliminary or incidental thereto;

. . . . .

if the Director is satisfied that his financial resources do not exceed the limits specified in section 5 of the Legal Aid Ordinance in relation to the grant of legal aid under that Ordinance.

. . . . .

The relevant part of section 5 of the Legal Aid Ordinance, as amended, is as follows:

"5(1) Legal aid ... shall, subject to and in accordance with this Ordinance, be available for any person whose financial resources do not exceed $120,000'..."

15. The "financial resources" of an applicant for legal aid are required to be calculated in accordance with the provisions of the Legal Aid (Assessment of Resources and Contributions) Regulations, as amended on lst July 1992.

16. I return to the Rules. In respect of appeals, rule 10 states:

"10. Subject to rule 13 in the case of an appellant convicted of a capital charge, in determining an application for legal aid by an appellant the Director shall consider -

(a) all the circumstances of the case and, in particular, the certificate of counsel assigned to represent him at his trial given under rule 9; and

(b) the financial resources of the appellant, and shall not grant the application unless he is satisfied that legal aid is desirable in the interests of justice."

17. Rule 12 prescribes the circumstances in which this court can override a decision of the Director to refuse a grant of legal aid, in these terms:

"12(1A) ...

(1) If the Director is not satisfied that the appellant should be granted legal aid to appeal the Director shall refuse the application and shall forward to the Registrar a notice of his refusal in such form as he may determine.

(2) Where the Director is not satisfied that the financial resources of the accused person do not exceed the relevant amount specified in rule 4, the refusal of the application shall be final and may not be disturbed.

(3) If on an appeal from any conviction order or determination in respect of or in connection with any offence, it appears to a judge or, in the case of an appeal to the Court of Appeal, to the court or a judge thereof that an appellant should be granted legal aid notwithstanding that the Director has refused his application, the judge or the Court of Appeal may, subject to paragraph (2) grant him an appeal aid certificate, and the Director shall thereupon assign a solicitor and one or two counsel, one of whom may be leading counsel, or solicitor and counsel only, as he may think fit to represent the appellant."

18. I mention here in passing that in respect of civil proceedings, provision is made by section 26 of the Legal Aid Ordinance for an appeal against any decision of the Director to the Registrar of the Supreme Court whose decision is final unless he refers the appeal to a judge of the Supreme Court, in which event the judge's decision is final.

19. The wholly new discretionary power given to the Director mentioned above is to be found in paragraph (2) of the amended rule 15, which now reads:

"15(1) Subject to paragraph (2) the Director shall assess the financial resources of each applicant for legal aid in accordance with the Legal Aid (Assessment of Resources and Contributions) Regulations as if the applicant were a person applying for legal aid under the Legal Aid Ordinance, and those regulations shall apply accordingly.

    (2) The Director may, if he is satisfied that it is desirable in the interests of justice, grant a legal aid certificate or an appeal aid certificate to an applicant notwithstanding that on an assessment under paragraph (1) he determines that the applicant's financial resources, in the case of legal aid to which section 5 of the Legal Aid Ordinance (Cap. 91) applies, exceed the amount specified in that section."

20. When the Director of Legal Aid refused Mr. Mirchandani's latest application for legal aid on 16th July, notice of his decision was given in these terms:

"1. Chandra Thanwardas Mirchandani of Lai Chi Kok Reception Centre, the appellant in the above' proceedings re-applied for legal aid.

2. Having considered the merits of the case and the financial resources of the said applicant I have refused him legal aid on the means test.

3. I am not satisfied that the financial resources of the applicant do not exceed the relevant amounts set out in section 5 of the Legal Aid ordinance as applied by rule 4."

It is clear from the wording employed that the Director took into account the new basis for the determination of eligibility for assistance ("financial resources" are mentioned instead of "disposable resources"). There is however, no indication as to whether or not the Director exercised the new discretion given by rule 15(2) in the latest refusal.

21. Mr.. Philip Dykes, who appears before us instructed by the Crown Solicitor, has submitted that this discretion cannot be exercised in favour of an applicant unless the Director has been given sufficient information so that he can be satisfied as to the actual extent of the applicant's financial resources. I do not wish to be taken as necessarily accepting that construction of paragraph (2) of Rule 15 in reaching my conclusions on the matter before us. A concluded opinion on the true meaning and effect of that paragraph is not in my view necessary since we are not sitting on appeal from the Director's decision, nor are we examining that decision in properly constituted judicial review proceedings.

22. The provision of the Hong Kong Bill of Rights ordinance which we have to consider is to be found in Article 11. It is in these terms:

                                "     Rights of persons charged with or convicted of criminal offence

.....

(2) In the determination of any criminal charge against him, everyone shall be entitled to the following minimum guarantees, in full equality -

. . . . .

(d) to be tried in his presence, and to defend himself in person or through legal assistance of his own choosing; to be informed, if he does not have legal assistance, of this right; and to have legal assistance assigned to him, in any case where the interests of justice so require, and without payment by him in any such case if he does not have sufficient means to pay for it;

. . . . ."

23. Article 11 of the Bill of Rights was recently considered by this court (Silke, V.-P., Macdougall, J.A. and Bewley, J.) in The Queen v. Fu Yan, Criminal Appeal No. 490 of 1991, 23rd May 1992 (not yet reported). In that case, the applicant for leave to appeal against his convictions after a trial in the High Court was refused legal aid "on the merits" and the Director's notice indicated (consistent with the law then in force) that he was satisfied that the disposable resources of the applicant did not exceed the relevant amounts.

24. Silke, V.-P. (who gave the judgment of the court)noted that the court was not concerned with the issue of the means of the applicant because it had been accepted all along that the applicant did not have the funds with which to provide himself with legal assistance. The learned Vice-President reviewed the grounds of appeal and the cases for the Crown and the applicant at the trial. He saw the task of his court to be this (p.9 of the transcript of the judgment):

"We have to consider whether Article 11(2)(d) applies to appellate procedures and, if so, do the interests of justice require that Fu Yan has legal assistance assigned to him."

25. He then referred to provisions similar to Article 11 in the International Covenant on Civil and Political Rights and in the European Convention on Human Rights and said, at p.9:

"Following the generality of the lines of construction of the Bill, set out in R. v. Sin Yau Ming [1992] 1 HKCLR page 127, this court may have regard to authorities from other jurisdictions which have incorporated either the Covenant or the Convention and which protect the same or similar rights. While it is not specifically spelt out in the provisions of Article 11, nevertheless, it has been accepted in those jurisdictions that Article 11(2)(d) does have application to the appellate procedure."

26. After reviewing a number of authorities and the scheme of our legislation (of course, as it stood before the 1st July amendments), Silke, V.-P. observed, at p.14:

"We find, bearing in mind that which has been said in other jurisdictions and on full consideration of Article 11 of the Bill, that there is no absolute right to legal aid in criminal trials or, a fortiori, in appellate proceedings. Nor is there an absolute right to be provided with a full transcript at public expense. Neither public funds nor judicial resources are limitless - (cf R. v. Munroe [1990] 59 CCC (3d) 421). What must be viewed is the interests of justice overall, with a bias towards the interests of the individual appellant. As Mr. Macrae has put it in his submissions, the case must be looked at as a whole and the most significant factor in any assessment of the interests of justice must be whether or not there are merits in the appeal."

A little later, on the same page, he said:

"In our judgment what the Bill does is to broaden the construction to be placed on 'the interests of justice' which this court considers when determining whether it should or should not grant legal aid on the merits after a refusal by the Director. The Director himself is enjoined to consider the interests of justice. Rule 10 say that the Director shall not grant legal aid unless he is satisfied that it is desirable in the interests of justice. Bearing in mind the preamble to the covenant, we would make use of a more purposive construction and say that legal aid shall be granted where the interests of justice so require."

27. The court concluded that the interests of justice in the particular case did not require that the applicant be given legal assistance in the presentation of his appeal. Towards the end of the judgment, Silke, V.-P. said, at p.16:

"In essence we find that, while Article 11 does apply to appellate proceedings, it confers no absolute right on an appellant for the grant of legal aid by this court, subsequent to a refusal by the Director. While both the Director and this court must consider the interests of justice this court will take a more liberal view of when those interests require the grant of legal assistance. In so doing it will consider the merits and whether there appears to be 'reasonable grounds'. Every application has to be decided on its own merits."

28. An examination of the issues before us must, of course, begin by emphasising that, by its very terms, Article 11(2)(d) of the Bill of Rights recognises that there is no absolute right to legal aid "without payment". Two conditions must be satisfied - "the interests of justice" must require that legal aid be provided but only if the person concerned "does not have sufficient means to pay for it."

29. Both Mr. Dykes, and Mr. Andrew Macrae (for whose assistance as amicus curiae we are grateful) agreed that in the present case it could hardly be suggested that the first condition would not be satisfied. Mr. Macrae pointed out that the lengthy trial was factually and legally complex, with a summing-up which ran to some 150 pages. The transcript is over 3,700 pages long. Lengthy sentences of imprisonment and huge fines had been imposed. Mr. Macrae suggested that in such circumstances an appellate court would be greatly assisted by legal argument and presentation by each side, particularly where the appellant had been unrepresented at the trial.

30. However, we know that that is not the only consideration. Since the cost of providing legal aid and assistance to those who cannot afford it is necessarily a charge on the public purse, there must surely be inbuilt mechanisms to regulate and limit the cost. Moreover, the availability of free legal aid must be measurable with due regard to the overall funds available for others before the courts and for the myriad needs of a sophisticated, well-ordered and caring society. Subject to what I will say presently, what proportion of available funds should be allocated for this purpose is a political decision and not a matter for the courts. Nor is it for the courts to presume to prescribe what degree of indigence should trigger eligibility for free legal aid, or what authority should determine the financial standing of an applicant for legal aid.

31. It seems to me that what this court has to decide is whether it has been shown that the principal and subsidiary legislation governing the provision of legal aid in criminal cases violates Article 11(2)(d) of the Bill of Rights.

32. I think that Mr. Dykes is right when he argues that it would hardly be practicable, and would surely be improvident, for the law to require any authority charged with the administration of legal aid in criminal cases to operate from the standpoint of a presumption of eligibility on the basis of means. I agree that there is nothing objectionable in principle to a regime under which persons who claim the right to free legal assistance are "means tested" to determine whether or not they have "sufficient means". As Mr. Dykes points out, none of the decisions of the European Court of Human Rights appears to have questioned the right of the State, which has to provide the necessary funds, to require an applicant to demonstrate eligibility on the grounds of indigence. I would observe here that no one has suggested that the level of financial resources for the purpose o?eligibility for legal aid has been set so low as to deny, in practical terms, the right accorded by Article 11(2)(d).

33. As both counsel who appeared before us have pointed out, the recent amendments to the scheme under which legal aid is made available in criminal cases (apart from altering and raising the financial criteria for eligibility) have given the Director an entirely new discretion to grant legal aid in respect of trials and appeals which can be said to . overcome a possible defect in the scheme in force before 1st July 1992. Before the new paragraph (2) was added to rule 15 of the Legal Aid in Criminal Cases Rules, the Director had no power (capital cases apart) to grant legal aid unless he was satisfied that the applicant's means did not exceed the statutory limits. Now, as we have seen, the Director may grant legal aid in relation to a trial or an appeal if he considers that the interests of justice so dictate, even if the applicant's financial resources are found to exceed the prescribed amount.

34. In deciding an application, the Director is now able,. for example, to take into account matters such as the length and complexity of the case and the extent by which the means of the applicant exceed the statutory limit. It is not difficult to imagine a trial or an appeal involving a difficult and perhaps unsettled point of law, the determination of which requires the assistance of experienced counsel on each side. If the applicant is of only moderate means (although he would not ordinarily qualify for legal aid) it might be wholly unrealistic and unfair to expect him to pay for appropriate legal representation. In such a case, the Director could consider using his widened powers with greatly beneficial results.

35. No argument has been addressed to us to suggest that rule 12(2) of the Rules (which, as we have seen, states that a refusal by the Director of an application, if based on means, is "final and may not be disturbed") violates Article 11. There must eventually be finality.' The rule making authority (be it remembered, with the approval of the Legislative Council) has decided that the Director shall be the final arbiter as regards the assessment of the means of the applicant. This is to be contrasted with the provisions of rule 12(3) of the Rules set out above which allow the Court of Appeal to grant a legal aid certificate notwithstanding the decision of the Director, unless it has been made under rule 12(2). I do not wish anything I am about to say to be understood as suggesting that any grounds exist in the instant case but, as counsel have submitted, in an appropriate case, the Director's decision may be amenable to judicial review despite the words with which rule 12(2) conclude.

36. In my judgment there is nothing in the law in force relating to legal aid in criminal cases which violates the Bill of Rights. The scheme regulates the grant of legal aid to the indigent in a manner wholly consistent with Article 11(2)(d). I have not been persuaded that Mr. Mirchandani is entitled to any relief that this court may lawfully give him.

Macdougall, J.A.:

37. I agree. So that there may be no misunderstanding of what was said by a differently constituted division of this court in Fu Yan, I should like to make it plain, since I was a member of the court which gave that judgment, that when we referred in the final paragraph to "future applications for legal aid under the Bill", we did not intend that this court would treat those applications as applications for legal aid made under the Bill of Rights.

38. There were many applications of the same kind as that in Fu Yan awaiting the decision of this court in that case. It was these applications that we had in mind in Fu Yan. Our intention was that notwithstanding the basis on which they were made they would be dealt with as invitations to this court to exercise its powers under rule 12(3) of the Legal Aid in Criminal Cases Rules, Cap. 221 to grant legal aid.

Sears, J.:

39. I agree with the conclusion which the Vice-President has reached. I also share his opinion that a true construction of the new rule 15(2) is not necessarily that as submitted by Mr. Dykes.

   The form utilised by the Director of Legal Aid on July 16th is clearly inappropriate for the amended rule, as has been recognised by the Crown. Although there may not be a duty to set out in precise terms the fact that, notwithstanding a refusal is given because of means, the Director has exercised the new discretion now given in the Rule, it would be of assistance for an applicant to know that such a discretion has been exercised. In this way, much time and expense might be saved when an applicant is faced with a refusal which on its face appears to conflict with the Rule.