SECRETARY FOR JUSTICE v. FTCW AND OTHERS

CACV 101/2013,
CACV 107/2013 &
CACV 167/2013
(Heard together)

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 101 and 107 OF 2013

(ON APPEAL FROM HCMP NO. 188 OF 2012 )

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REASONS FOR JUDGMENT

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Hon Lam VP (giving the Reasons for Judgment of the Court):

1.  We shall adopt the same nomenclature regarding the parties as in our main judgments in CACV 154 and 166 of 2012 and CACV 101, 107 and 167 of 2013. We handed down three judgments in these appeals on 10 January 2014: one for CACV 154 and 166 of 2012; one for CACV 101 and 107 of 2013 and one for CACV 167 of 2013. This judgment deals with the following applications for leave to appeal to the Court of Final Appeal:

(a) Amended Notice of Motion by STL and Octaland III in respect of CACV 107 of 2013;

(b) Amended Notice of Motion by STL and Octaland III in respect of CACV 101 of 2013;

(c) Notice of Motion by STL and Octaland III in respect of CACV 167 of 2013;

(d) Notice of Motion by the Husband in respect of CACV 107 of 2013;

(e) Notice of Motion by the Husband in respect of CACV 101 of 2013;

(f) Notice of Motion by the Husband in respect of CACV 167 of 2013.

2.  In respect of the applications in CACVs 154 and 166 of 2012, it was directed on 10 February 2014 that they shall be heard (if necessary) on another occasion.

3.  After hearing submissions, we refused to grant leave in the applications in CACVs 101, 107 and 167 of 2013.  We now give reasons for the refusal.

CACV 101 and 107 of 2013

4.  In these appeals, we held that subject to the legal professional privilege [“LPP”] issue as between the Secretary for Justice and STL, the Husband and Octaland III (which we have remitted back to a judge of the Court of First Instance), paragraph 1 of the order of Ng J of 14 May 2013 in terms of the grant of access to the Director of Public Prosecution of materials in the court files shall be implemented.  As between the Wife and STL, the Husband and Octaland III, we held that the appeals by the latters shall be dismissed.  In other words, we held that Ng J was correct in releasing the Wife from her implied undertaking in terms of the use of documents for the limited purposes as set out in paragraph 2 of that order.

5.  Applications are made by STL, Octaland III and the Husband for leave to appeal against our judgment pursuant to Section 22(1)(b) of the Hong Kong Court of Final Appeal Ordinance Cap 484.  They contended in their respective Notices of Motion that there are questions of great general or public importance or issues which otherwise ought to be the subject of determination by the Court of Final Appeal.

6.  The questions set out by STL and Octaland III in their two Amended Notices of Motion are identical.  They are formulated under two heads: LPP and privilege against self-incrimination [“PSI”].  Under LPP, the questions are as follows:

“1. In circumstances, where the Court of Appeal had decided that the Appellant (“STL”) could refuse to hand over documents to the Secretary of Justice (“SJ”) on the grounds of LPP, should the Court have granted the 1^st Defendant (“FT”) permission to hand those very documents to the SJ, on the grounds that Saunders J had decided in matrimonial proceedings to which STL and FT were party, that the documents were not privileged on the grounds of the principle in R v Cox and Railton [1884] 14 QBD 153, where the Court had decided that that decision was not res judicata between SJ and the STL and it was not an abuse of process for STL to rely upon LPP as against the SJ?

2.   Is it permissible for the Court to permit FT to release to SJ documents which would be privileged in the hands of the SJ or the police for them to make derivative or other use of documents, which the SJ or the police would know, are subject to LPP irrespective of whether LPP would prevent such documents being admissible in evidence at trial?

3.   The previous question involves another fundamental issue which is whether LPP is merely part of the law of evidence which confers a right to withhold from a court, or a tribunal exercising judicial functions, material which would otherwise be admissible in evidence or is it a fundamental human right which can be employed to resist any attempt at disclosure to a party against whom LPP can be maintained and which can be asserted to prevent any party (against whom a claim to LPP remains) from obtaining or making use (derivative or otherwise) of documents, communications or other forms of material over which a valid claim to LPP still exists?

4.   Is it ever legitimate to engage in a balancing exercise which weighs the public interest in upholding LPP as against other public interests?  Or is LPP an absolute and fundamental human right which must always be upheld regardless of the other public interests which may be at stake?

5.   Is a loss of privilege in a civil context, relevant to the operation and maintenance of privilege in a criminal context?”

7.  On questions (1) to (3) under the heading of LPP, we do not think there is any question of great general or public importance being involved.  We applied the well-established principle as regards issue estoppel to the facts of the present case in holding that there is an issue estoppel between the Wife and STL, Octaland III and the Husband but not as between the Secretary for Justice and STL, Octaland III and the Husband.  The distinction between derivative use and the deployment of such evidence in court proceedings is again well settled in Hong Kong having regard to the decisions of the Court of Final Appeal cited in our judgment.

8.  On question (4), it is a misreading of our judgment.  We did not conduct the balancing exercise in the context of LPP.  We considered the question of LPP in Section D of our judgment.  As it should be apparent from our judgment, we refer to the balancing exercise in Section E in the context of addressing the general exercise of discretion in granting access to documents under the custody of the court.  That is a separate question from LPP and only came into the equation subject to whatever rights the parties may have in LPP.  Thus, our remittance of the case back to the Court of First Instance for the consideration of LPP.  

9.  Question (5) should not be considered as a question in abstract.  It depends on what one regards as the civil context and the maintenance of privilege in criminal context.  Ultimately, it is just another way of putting forward an issue concerning derivative use and it must depend on the facts of each case instead of capable being answered as a general proposition of law.

10.  Turning next to the questions  on PSI, they are formulated as follows:

“25. Is the privilege against self-incrimination only available at the time of making the relevant statements and/or the creation of the relevant material?

26. Is there no privilege against self-incrimination in a case where the relevant statements or material constitute the crime itself?

27. Are the principles in Allen v UK App No. 76574/01 (2002) 35 EHRR CD 289 (a case where the information required did not incriminate the Defendant in the commission of an offence due to acts or omissions in which he had been involved prior to the time the information was sought, nor was it a case where the Defendant was prosecuted for his failure to provide information which might have incriminated him in criminal proceedings anticipated at the time the information was sought) applicable to the situation where the relevant persons are under appreciable risks of being prosecuted?

28. Should the English Court of Appeal decision in R v K [2010] QB 343 be considered good law in Hong Kong?

29. Having regard to the fact that the documents which were subject to a claim for LPP and were produced pursuant to Saunders J’s order were disclosed under compulsion, should the CA have upheld STL’s plea that PSI was a bar to the SJ obtaining access to those documents, especially as those documents could not be said to be either forged or perjured, being genuine contemporaneous documents, which FT had sought in an attempt to prove that the CLA 2006 was backdated?

30.    Given that a prosecuting authority is permitted to make derivative use of documents or information already in its possession even though direct use is prohibited, should a court accede to an application by a prosecuting authority to obtain compulsorily obtained information, in circumstances where PSI has been abrogated, so that the prosecuting authority might thereafter make derivative use of it?”

11.  On questions (25) to (27), as explained in our judgment paras 32 to 38, we have considered whether PSI is engaged in the specific factual context of the present case.  For the reasons given in those paragraphs, we do not think it is reasonably arguable that STL, Octaland III and the Husband could claim PSI in respect of documents produced by them in the course of the alleged perjury, forgery and conspiracy to pervert the course of justice.

12.  On question (28), the facts of R v K [2010] QB 343 were different from the facts of the present case and for the reasons we gave in our judgment, we do not find that decision to be of assistance in our case.  As we said at para 78 of our judgment, we did not find it necessary to decide whether Hong Kong law should follow the same result on facts similar to those in that English decision.  Thus, the present case does not provide the factual basis for raising question (28) before the Court of Final Appeal.

13.  Question (29) is clearly facts specific and does not, in our view, give rise of a question of great general or public importance.

14.  Question (30) is premised upon that PSI has been abrogated.  For reasons already given in our judgment, this is not the case in the present instance in respect of documents not subject to claims of LPP.  Thus, the question does not arise here.

15.  In the Notices of Motion of the Husband, the questions are also identical.  They are as follows:

“1. Is the rule in R v K [2010] QB 343 to be considered good law in Hong Kong?

2. If it be the case that R v K [2010] QB 343 is good law in Hong Kong, i.e. the duty on divorce to effect full disclosure of resources and of all facts and matters that bear upon their ownership (if disputed or debatable) and their value abrogates for the purpose the privilege against self-incrimination [PSI], does the consequential prohibition on adduction of such evidence in subsequent criminal proceedings apply to

(a) statements made by the parties;

(b) documents produced by the parties and/or;

(c) affidavits made by the parties?

3. Does the rule in R v K [2010] QB 343 extend to a non-spouse where there is an issue in the case as to the beneficial ownership of property, at least if that person be joined as a party to the divorce proceedings?

4. Does the protection available under the rule in R v K [2010] QB 343 extend to the derivative use of disclosed material (whether statements or documents) i.e. can the Secretary for Justice [SJ] be prohibited from making any use of the relevant material, if it comes into his possession?

5. Ought the court to entertain and/or accede to an application on the part of the SJ for production of documents and statements where the SJ intends to use the material for derivative purposes where

(a) the documentation came into the possession of the court (and the other parties) as a matter of compulsion; and

(b) the documents could not have been obtained without the express or implied abrogation of the PSI?

6. Is it correct that the Hong Kong Bills of Rights Article 10 privilege against self-incrimination can only be engaged if the statement is made or the document produced at a time the relevant person is under investigation for an offence?

7. In considering the future admissibility on a charge of perjury or perversion of the course of justice (or the derivative use on the investigation of such a charge) of material produced pursuant to court order, is a distinction to be drawn between:

(a) an affidavit which is said to constitute the alleged offence;

(b) other documents that may be relevant or probative but are independent and pre-existing documents: which are exhibited to the affidavit; and

(c) other documents that may be relevant or probative but are independent and pre-existing documents: which are not exhibited to the affidavit, but which are produced as part of the mandatory disclosure duty or compulsory discovery of documents?

Legal Professional Privilege (“LPP”)

8. Does permitting the SJ to make derivative use of documents that are covered by LPP undermine the fundamental human right to legal professional privilege [LPP] that is enshrined in the Basic Law and confirmed by the Court of Final Appeal in Akai Holdings Ltd v Ernst & Young [2009] HKCFA 14 and in Citic Pacific v Secretary for Justice and Commissioner for Police (2011) HKCFI 1843?

9. Is it legitimate to undertake in an individual case a balancing exercise which weighs the maintenance of LPP against other public interests? OR is LPP an absolute and fundamental human right which must always be upheld?

Implied undertaking

10. What is the test when a civil court is considering the relaxation of the implied undertaking not to use discovered documents and statements for a collateral purpose [the implied undertaking] for the purpose of criminal investigation?

11. Given that allegations of non-disclosure of resources and other misbehaviour are routinely made in divorce proceedings, is it appropriate for the court to encourage a second round of investigation into a family’s (financial) affairs in reliance on discovered documentation (a fortiori where the documentation has been produced under compulsion [see the PSI points above]); or should the court’s policy be to bring what are essentially family disputes to an end as soon as practicable?

12. Is it appropriate the release a party from her implied undertaking in respect of documents that remain subject to LPP so far as the SJ is concerned

(a) at all; or

(b) before the question of whether the SJ is able to override that LPP has been determined?

13. Where a judge has formed a view as to alleged criminality based on material that was not properly in evidence before him, and no adverse findings by him can be sustained, is it appropriate for a party to be released from her implied undertaking in order for her to promote a criminal investigation under the direction of the SJ?”

16.  Questions (1) to (4) revolve around the so-called rule in R v K.  For reasons already given above, we do not think R v K is of much assistance on the facts of the present case.

17.  Question (5) addresses the exercise of discretion by the court in the grant of access to documents in the court files. This clearly calls for the examination of the facts of the case.  As we have emphasised in our judgment, we are dealing with the grant of access to the Director of Public Prosecution in respect of allegations of perjury, forgery and perverting the course of justice in the course of court proceedings.  It also wrongly premised on the assumption that there had been abrogation of PSI. We do think the question as formulated can be answered in the abstract without regards to the circumstances of the case.  Thus, it is a fact specific question and does not raise any question of great general or public importance.

18.  For the reasons we have explained in our judgment paras 39 to 48, Question (6) is a case-specific issue and we have not decided the case on this ground.  As such, it cannot provide a proper platform for leave to be granted.

19.  Question (7) is clearly facts sensitive and it does not raise any question of great general or public importance.

20.  Questions (8) and (9) raise similar questions on LLP which we have already dealt with in the context of the Notices of Motion of STL and Octaland III.

21.  Questions (10), (11) and (13) are questions on the exercise of the discretion on the part of the court which must depend on the facts of the case.  We came to our decision on the release of implied undertaking very much with regards to the facts of the present case.  We do not regard them as raising questions of great general or public importance.

22.  Question (12) is, in essence, the same as Question (1) in STL and Octaland III’s Notices of Motion.  It does not raise any question of great general or public importance.

23.  Nor do we see any basis to grant leave on the otherwise limb.

CACV 167 of 2013

24.  In this appeal, we granted permission to the Wife to make use of and disclose the Main Judgment of Saunders J as corrected on 6 July 2012 and the Barrell Judgment in their unredacted form for the purpose of enforcement proceedings.

25.  STL and Octaland III contended in their Notice of Motion that the following questions should be determined by the Court of Final Appeal,

“1. Whether the Petitioner should be able to use for enforcement the unredacted Judgments, which contain findings made by Saunders J on an issue, which was not the subject of legitimate enquiry and, on the basis of material, which was inadmissible, which the Court of Appeal has decided should be deleted from the Main Judgment?

2. Whether a successful litigant should be allowed to disclose the reasoned judgment (as opposed to the sealed orders), which is prohibited from disclosure pending appeal against the orders for the purpose of the successful party’s enforcement of the said orders in overseas jurisdictions?

3. Whether an express or implied undertaking as to confidentiality given by a successful litigant in Hong Kong court proceedings provides sufficient or any protection in the context of foreign court proceedings brought by the successful litigant to enforce against assets of the losing party located in the foreign jurisdictions?

4. Whether on an application for release from the implied undertakings the burden lies on the Applicant to offer undertakings which will protect the implied undertaking or whether the burden is on the Respondent to ask for specific undertakings to prevent the Applicant from breaching her implied undertaking. The question of burden of proof in such cases is of significant practical and public importance in such cases.

5. If the answer to question 2 above is yes, whether the implied undertaking of confidentiality of the Petitioner constituted sufficient safeguards to the risk of general publication of the Main and Barrell Judgments of Saunders J dated 1 December 2011and 6 July 2012 respectively?”

26.  Similar questions, framed in different wordings, are raised in the Husband’s Notice of Motion,

“1. Where the Court of Appeal has:

(1) held that a Judge had in his first instance Judgment wrongly indulged in canvassing and making findings on matters that (a) were not in issue before him, (b) were irrelevant, (c) were, not the subject of legitimate enquiry, and (d) comprised or were based upon inadmissible materials; and

(2) has ordered the setting aside of the findings and the deletion or redaction of the offending materials and consideration from the first instance Judgment;

whether a party should nevertheless be permitted to make use of and/or disclose the first instance Judgment in its original and unredacted form for enforcement in foreign proceedings before a foreign court (either at all or in particular in circumstances where the first instance Judgment in its unredacted form has not theretofore been disseminated nor published?

2. Whether, where there has been no appeal against a stay granted by one first instance Judge another first instance Judge has jurisdiction or power to partially lift such stay?

3. Whether the burden lies on the applicant (applying to be released from the implied undertaking) to adduce evidence as to foreign law so as to satisfy the Hong Kong Court that the undertaking as to confidentiality (whether implied or expressly given) would be binding and/or honoured and/or would not be breached?

4. Whether, in the absence of evidence as to foreign law, it is open for the Hong Kong Court to assume that any and all foreign courts will be bound by or would honour a party’s undertaking as to confidentiality to the Hong Kong Court, whether implied or expressly given, so that the same would not be breached?

5. Whether a party would be in contempt of court (for breach of undertaking as to confidentiality; whether implied or expressly given) by making use of a judgment in foreign proceedings before a foreign court, either sitting in public or open proceedings or otherwise resulting in public disclosure of the judgment?

6. Whether the implied undertaking as to confidentiality affords sufficient protection and safeguard against the risk of general publication of unredacted judgments; and, if not, whether the burden lies upon the applicant (applying to be released from the implied undertaking) to proffer express undertakings and the wording(s) thereof, or lies upon the respondent to propose the same?”

27.  The following points of principle germane to our decision on 10 January 2014 are not in dispute,

(a) The grant of leave to disclose the judgment for the limited purpose of enforcement is not the same as a general leave to publish the judgment;

(b) In general, the use of a judgment for the purpose of enforcement is not collateral use and as such not a breach of the implied undertaking;

(c) Notwithstanding the grant of such limited leave, the Wife would still be obliged to observe the implied undertaking against general publication;

28.  As regards the risk as to the leakage of the judgment for other collateral purposes, it cannot be disputed that there is no evidence before the court to suggest that such leakage is likely to happen.  In any event, the assessment of such risk is fact sensitive and cannot be a point of great general or public importance. In the absence of any evidence to the contrary, the courts in Hong Kong should proceed on the basis of judicial comity and foreign courts can be expected to pay regard to the wife’s undertaking of confidentiality.

29.  Against such background, we do not think the questions raised could have any practical impact on the outcome of the appeal. The lack of utility in the intended appeal to the Court of Final Appeal is enhanced by the general publication of our judgments and our permission to publish the judgments of Saunders J, albeit the latter in the redacted form.  The concern of the Husband, STL and Octaland III on inappropriate use of the un-redacted judgments in enforcement proceedings can be adequately addressed by their liberty to use our judgments in such proceedings.

30.  We refused to grant leave accordingly.