SECRETARY FOR JUSTICE v. CHAN CHI WAN STEPHEN

FACC Nos. 11 & 18 of 2016

FACC No. 11 of 2016

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 11 OF 2016 (CRIMINAL)

(ON APPEAL FROM CACC NOS. 103 OF 2012 AND 183 OF 2014)

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FACC No. 18 of 2016

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 18 OF 2016 (CRIMINAL)

(ON APPEAL FROM CACC NOS. 103 OF 2012 AND 183 OF 2014)

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BETWEEN

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JUDGMENT ON COSTS

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Mr Justice Ribeiro PJ:

1.  This is the judgment of the Court.

2.  By its judgment dated 14 March 2017,[1] the Court unanimously allowed the appeals of Mr Chan and Mr Tseng and quashed their convictions for conspiracy relating to, and substantive offences under, section 9 of the Prevention of Bribery Ordinance (Cap 201).  The parties’ written submissions as to costs have now been received.

3.  The proceedings followed the course described in Section B of the judgment, involving a District Court trial and its resumption on a remitter (resulting on each occasion in an acquittal); two successful appeals by the prosecution to the Court of Appeal by way of case stated; and the proceedings before this Court.  

4.  We held that in reversing the trial judge, the Court of Appeal had failed correctly to apply the leading Privy Council authority[2] on the nature and limits of section 9 and applied the wrong test for determining whether the necessary relationship between the agent’s act or forbearance and the principal’s affairs or business was proved.[3]  The prosecution failed to prove conduct by the appellants subverting the integrity of the agency relationship to the detriment of the principal’s interests, the evidence showing instead that the appellants’ conduct had been beneficial to and congruent with the interests of TVB.[4] 

5.  Given this outcome, with one exception, the prosecution does not object to an order for costs in favour of the appellants in respect of the proceedings culminating in the quashing of their convictions, with a certificate for two counsel in each case. 

6.  The exception relates to Mr Chan’s claim for “all costs related and incidental to the arrest”.  The prosecution argues that these are not costs arising out of his prosecution and would have been incurred whether or not the decision to prosecute had been taken.

7.  We agree that such costs are not to be included in the Order in favour of Mr Chan.  The Court’s power to order payment of costs is contained in section 43 of its statute[5] which provides:

“Costs, including costs in the courts below or before a magistrate, shall be paid by such party or person as the Court shall order ...”

8.  It was held in Tong Cun Lin v HKSAR,[6]that the power to order costs to be paid out of the public revenue in criminal cases derives from section 73A of the Costs in Criminal Cases Ordinance,[7] and the Court gave guidance on the exercise of the discretion.  Section 73A relevantly provides:

“(1) Where after trial in the court a person is acquitted, the court may order the payment out of the public revenue of the costs of the defence, including the costs of any proceedings before a magistrate.

(2) The costs payable to any person under this section shall be such sums as appear to the court reasonably sufficient to compensate that person for any expenses properly incurred by him in or about the defence. ...”

9.  Thus, the section 43 power relates to “costs in the courts below” and under section 73A, the power concerns “the costs of the defence” and “expenses properly incurred by him in or about the defence”.  We do not consider that costs incidental to an arrest can be treated as coming within the abovementioned words.

10.  Accordingly, we order that the prosecution pay to each of the appellants the costs of and occasioned by:

(a) the first and resumed trial in the District Court;

(b) the first and second Case Stated Appeals before the Court of Appeal; and

(c) all proceedings before this Court;

limited in each case to two counsel.