PHILIP K H WONG & KENNEDY Y H WONG (a firm of solicitors) AND ANOTHER v. THE COMMISSIONER OF THE INDEPENDANT COMMISSION AGAINST CORRUPTION

HCAL 70/2007

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO. 70 OF 2007

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J U D G M E N T

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Introduction:

1.  This application for Judicial Review relates to the issue by a magistrate of two search warrants to search premises.

2.  The warrants were issued on 22 May 2007, the first in respect of the offices of the First Applicant, (the solicitors), the second in respect of the offices of the Second Applicant, (the secretarial company).  Both Applicants share the same premises, the secretarial company is owned and operated by the solicitors.

3.  The search warrants were issued on the application of the Respondent, (ICAC), on their face, pursuant to powers to search contained in s 10B Independent Commission Against Corruption Ordinance, Cap 204, (ICACO).

4.  The search warrants relate to a company called Roselle Court Ltd,  (Roselle Court) and a person from Macau, Mr AO Man-long, (Mr AO).  The warrants both seek:

“…bank records, company registration records, letter of delegation, Power of Attorney, accounting records, payment records, files, quotations, computer records, documents or any other thing or items relating to Roselle Court Ltd and AO Man-long which all contain evidence in respect of offences of accepting an advantage, and dealing with property known or believed to represent proceeds of an indictable offence referred to in Section 10 of the Ordinance.”

The reference to “Section 10 of the Ordinance” is a reference to s 10 Prevention of Bribery Ordinance (POBO), which is set out in para 20 below.

The issues:

5.  The challenge to the warrants raises two primary issues. 

6.  The first is whether, in the course of the investigation of the offence of dealing with property known or believed to represent the proceeds of an indictable offence, under s 25 Organized and Serious Crimes Ordinance Cap 455, (OSCO), ICAC is required to obtain a search warrant under OSCO, and may not rely upon the provisions of s 10B ICACO. 

7.  The second is whether the failure of the warrant to refer to appropriate steps to be followed in the event of a claim for Legal Professional Privilege, (LDP), invalidates the warrant.

The facts:

8.  The factual circumstances surrounding the events are not in dispute.

9.  Mr AO is a former Principal Official and Secretary for Transport and Public Works of the Macau Special Administrative Region Government.  Mr AO is presently on trial in Macau in respect of certain corruption offences.  Mr AO joined the Macau SARG in 1987, and was appointed to his former Principal’s position in December 1999. 

10.  An investigation undertaken by ICAC in Hong Kong reveals a good prima facie case that Mr AO has, throughout a number of years, accepted bribes of substantial amounts in relation to public works in Macau.  It is alleged that these bribes have been accepted in Hong Kong, from at least 4 contractors by using some 39 bank accounts opened in Hong Kong.  The contractors are alleged to have effected the relevant bank transfers of corrupt money in Hong Kong.  The investigation has revealed that these 39 bank accounts are held by overseas companies owned either by Mr AO personally, or by his wife, his sister-in-law, or associates, on trust for him by way of Declarations of Trust or Power of Attorney.

11.  The investigation has also revealed that part of the suspected corrupt moneys received in Hong Kong have been remitted to a particular bank account in the United Kingdom held by Mr AO’s brother and sister-in-law.  The various companies that have been used have no other apparent business.  There is good reason to believe that these companies are mere conduits for Mr AO to collect, and to deal with very substantial bribes.

12.  In the course of an arrest and search operation in Hong Kong in early December 2006, a will was found and seized belonging to Mr AO’s father.  The will names Mr AO as the beneficiary.  The will was prepared by the solicitors.

13.  In late December 2006 and February 2007, two restraining orders were obtained by ICAC pursuant to s 14C(1)(a) OSCO, as a result of which some HK$352 million is restrained.  In addition ICAC have seized about HK$80 million cash from two safe deposits controlled by Mr AO.

14.  Subsequent enquiries revealed that Mr AO had maintained written records of the amount of the corrupt proceeds he had collected over the years.  This led the investigators to Roselle Court.  Roselle Court is registered in the British Virgin Islands, and the secretarial company is its director.

15.  In the light of the foregoing facts, ICAC suspected that the solicitors and the secretarial company may have been used as innocent agents by Mr AO in an attempt to disguise his corrupt conduct and to facilitate the laundering of corrupt money through Roselle Court.

16.  ICAC plainly has strong grounds to suspect these circumstances.

17.  On the basis of the foregoing information, ICAC investigators appeared before the magistrate and sought the warrants at issue.

The investigative powers of ICAC:

18.  As its name implies, the ICAC is quite independent of, and distinct from, the Hong Kong Police Force.  It is established under s 3 ICACO, and draws its investigative powers from that Ordinance.

19.  The general power of ICAC to investigate offences arises from its powers of arrest pursuant to s 10 ICACO.  It naturally follows that ICAC may investigate any offence in which they have a power of arrest.  Primarily these will be corruption offences.  The legislature has limited the power of the ICAC to investigate other offences than corruption offences.

20.  The power of arrest of an ICAC officer is contained in s 10 ICACO.  The section has the effect of empowering ICAC officers to investigate corruption offences, and to delineate the circumstances in which ICAC officers may investigate offences other than corruption offences.  It is accordingly appropriate to set out that section in full.

“s.10   (1)   An officer authorized in that behalf by the Commissioner may without warrant arrest a person if he reasonably suspects that such person is guilty of an offence under this Ordinance or the Prevention of Bribery Ordinance (Cap 201) or the Elections (Corrupt and Illegal Conduct) Ordinance (Cap 554) or, being a prescribed officer, is guilty of an offence of blackmail committed by or through the misuse of office.

(2)   Where, during an investigation by the Commission of a suspected offence under the Prevention of Bribery Ordinance (Cap 201) or of a suspected offence under the Elections (Corrupt and Illegal Conduct) Ordinance (Cap 554), another offence is disclosed, any such officer may without warrant arrest a person if he reasonably suspects that such person is guilty of that other offence and-

(a)     he reasonably suspects that such other offence was connected with, or that either directly or indirectly its commission was facilitated by, the suspected offence under the Prevention of Bribery Ordinance (Cap 201) or the suspected offence under the Elections (Corrupt and Illegal Conduct) Ordinance (Cap 554), as the case may be; or

(b)     the other offence is one which is specified for the purposes of this subsection in subsection (5).

(3)   Any such officer-

(a)     may use such force as is reasonable in the circumstances in effecting an arrest under subsection (1) or (2); and (Amended 18 of 1976 s. 2)

(b)     may, for the purpose of effecting such an arrest, enter and search any premises or place if he has reason to believe that there is in the premises or place a person who is to be so arrested.

(4)   No premises or place shall be entered under subsection (3) unless the officer has first stated that he is an officer and the purpose for which he seeks entry and produced his warrant card to any person requesting its production, but subject as aforesaid any such officer may enter any such premises or place by force, if necessary.

(5)   The following offences are specified for the purposes of subsection (2)-

(a)     the offence of perverting or obstructing the course of justice;

(aa)   the offence of theft under section 9 of the Theft Ordinance (Cap 210);

(b)     the offence of blackmail under section 23 of the Theft Ordinance (Cap 210);

(ba)   the offence of fraud under section 16A of the Theft Ordinance (Cap 210);

(c)     the offence of obtaining property by deception under section 17 of the Theft Ordinance (Cap 210);

(d)     the offence of obtaining pecuniary advantage by deception under section 18 of the Theft Ordinance (Cap 210);

(da)   the offence of obtaining services by deception under section 18A of the Theft Ordinance (Cap 210);

(db)   the offence of evading liability by deception under section 18B of the Theft Ordinance (Cap 210);

(dc)   the offence of making off without payment under section 18C of the Theft Ordinance (Cap 210);

(dd)   the offence of procuring a false entry in certain records under section 18D of the Theft Ordinance (Cap 210);

(de)  the offence of false accounting under section 19 of the Theft Ordinance (Cap 210);

(e)     the offence of assisting an offender under section 90 of the Criminal Procedure Ordinance (Cap 221);

(ea)   any offence under regulations in force under the Electoral Affairs Commission Ordinance (Cap 541);

(f)      the offence of conspiracy to defraud and the offence of conspiracy to commit any of the offences referred to in paragraph (a), (aa), (b), (ba), (c), (d), (da), (db), (dc), (dd), (de), (e) or (ea);

(g)     an attempt to commit any offence referred to in paragraph (a), (aa), (b), (ba), (c), (d), (da), (db), (dc), (dd), (de), (e) or (ea) or the offence of aiding, abetting, counselling or procuring any offence so referred to.”

21.  The link to “other offences” in s 10(2) (a) and (b), is in the alternative. 

22.  The effect of s 10(2)(a) is that ICAC may investigate any other offence, whether specified in the ICACO or not, if that other offence is connected with, or which either directly or indirectly facilitated the commission of, the suspected POBO or E(CIC)O offence, or blackmail through the misuse of office offence. 

23.  The important consequence of s 10(2)(b), is that if it transpires that although suspected, there is no POBO or E(CIC)O offence, or blackmail through the misuse of office offence, but one of the offences specified in s 10(5) is revealed, then ICAC may continue to investigate the matter. 

24.  The corollary is that if an investigation reveals that there is no POBO or E(CIC)O offence, or blackmail through the misuse of office offence, but the investigation reveals an offence that is not specified in s 10(5), then the matter may not be further investigated by ICAC. 

25.  In those circumstances the proper course, ICAC having no legal jurisdiction in the matter, would be that the investigation must be handed to the appropriate Department of the Hong Kong SAR Government for investigation.  Usually this will be the Hong Kong Police Force, but in appropriate circumstances may also be the Customs and Excise Department, or the Immigration Department, or such other Department as may hold appropriate prosecuting authority in relation to the particular offence.

26.  The expressions used in s 10(2)(a), “connected with”, or “either directly or indirectly its commission was facilitated by” are in the widest possible terms.  There can be no doubt at all that the offence of dealing with property known or believed to represent the proceeds of an indictable offence, contrary to s 25 OSCO, is an offence falling, in appropriate factual circumstances, within that provision.

27.  Consequently, in appropriate circumstances, ICAC may investigate an offence contrary to s 25 OSCO.

28.  There can be no doubt at all that in the present circumstances ICAC were perfectly entitled to investigate not only the corruption offences alleged against Mr AO, but also the s 25 OSCO offence arising from his dealings with the proceeds of his corruption.

The power to search:

29.  A power to search is a necessary investigative tool.  On the arrest of the suspected person, using powers contained in s 50(6) Police Force Ordinance Cap 232, (PFO), a police officer, without warrant, may search and take possession of virtually anything which may be found on the arrested person or in or about the place at which he has been apprehended, and which the officer may reasonably suspect is relevant.  A lawful arrest is a necessary precondition of such a search.  In addition to that power of search, police officers draw search powers, independent of an arrest, in numerous other provisions in legislation such as the Dangerous Drugs Ordinance, (Cap 134), and the Theft Ordinance,  (Cap 210). 

30.  A separate power of search available to a police officer is contained in s 50(7) PFO.  Under this power the magistrate may issue a warrant for the search of any place, and the taking possession of any newspaper book or document or any article or chattel found therein.  This latter power is a purely investigative power.

31.  None of these provisions entitle an ICAC officer to obtain a search warrant in the course of an investigation.

32.  The power of an ICAC officer to obtain a search warrant is contained in s 10B ICACO.  That section provides:

“Without prejudice to section 17(1) of the Prevention of Bribery Ordinance (Cap. 201), if a magistrate is satisfied by information on post-that there is reason to believe that there is in any premises or place anything which is all contains evidence of the commission of any of the offences referred to in section 10, he made by warrant directed to any officer authorise such officer, and any other officers assisting him, to enter and search such premises or place.”

Section 17(1) POBO, which relates to additional powers of search available to ICAC officers, is not relevant in the present case.

The power of seizure:

33.  A warrant issued under s 50(7) Police Force Ordinance contains a power to take possession of items found.  However a warrant issued by a magistrate to an ICAC officer under s 10B ICACO does not authorise seizure.  Seizure of items found is separately dealt with in s 10C ICACO, under which an officer authorised in that behalf by the Commissioner may seize and detain anything which the officer has reason to believe to be or to contain evidence of any of the offences in s 10.

34.  The effect of these provisions is to give power to ICAC officers, in the course of an investigation, to obtain a search warrant for the magistrate and subsequent to seize items found.

35.  The powers of search and seizure in ICAC officers, described above, have existed since the establishment of ICAC in 1976.

The OSCO regime is established:

36.  In 1994, under OSCO, a new regime was created establishing, according to the long title of the Ordinance:

“new powers of investigation into organised crime and certain other offences and to the proceeds of crime of certain offenders”.

The offence of dealing with property known or believed to represent the proceeds of indictable offences was created by s 25 of OSCO.

37.  It is necessary to examine the regime under OSCO, in order to establish when the investigation of organised crime occurs, and the provisions of the Ordinance are engaged.

38.  First, the Ordinance defines organised crime in s 2(1):

““organized crime” (有組織罪行) means a Schedule 1 offence that-

(a)     is connected with the activities of a particular triad society;

(b)     is related to the activities of 2 or more persons associated together solely or partly for the purpose of committing 2 or more acts, each of which is a Schedule 1 offence and involves substantial planning and organization; or

(c)     is committed by 2 or more persons, involves substantial planning and organization and involves-

(i)      loss of the life of any person, or a substantial risk of such a loss;

(ii)     serious bodily or psychological harm to any person, or a substantial risk of such harm; or

(iii)     serious loss of liberty of any person.”

Schedule 1 includes a wide range of offences, including the common law offences of murder, kidnapping, false imprisonment, and a conspiracy to convert the course of justice.  It also includes offences under 15 specific ordinances, including the offence of dealing with property known or believed to represent proceeds of an indictable offence contrary to s 25(1) OSCO.  Scheduled 2 sets out a further schedule of offences which are themselves not within the scope of the expression “organised crime”.

39.  It will not be that every offence in Schedule 1 will always constitute an “organised crime”.  It will only be when the particular circumstances of the offences contained in Schedule 1, fall within the scope of the definition set out in para 38 above that the offence will constitute an “organised crime”, and consequently the provisions of OSCO will be engaged. 

40.  On the other hand, clearly there will be many circumstances when an offence under s 25(1), being either committed by a person by himself, or being in straightforward and unsophisticated circumstances, will not be an “organised crime”, even though the offence is created by OSCO.

41.  In the present case, where the steps taken by Mr AO to deal in the proceeds of an indictable offence, that is the corruption offences he is alleged to have committed, are steps which plainly involved two or more persons associated together, and there are plainly two or more acts, and the circumstances are such that they plainly involve substantial planning and organisation, the offence is within the definition of an “organised crime”. 

42.  It cannot be said that offences involving allegedly corrupt money being passed through 39 bank accounts in Hong Kong, bank accounts in the United Kingdom, through the use of BVI and other companies, and the use of declarations of trust and powers of attorney to conceal the true identity of those entitled to funds in the accounts, are not offences which involves substantial planning and organisation.

43.  Mr McCoy was right to say to me that the offence of possession of a forged identity card, a commonplace offence in Hong Kong regularly prosecuted within the magistracy, was a schedule 1 offence.  But he was, with respect, wrong to say that if the argument for the Applicants was correct, a search warrant required in respect of every “tinpot” forged identity card offence would require to be dealt with under OSCO.  It will only be when the particular criteria contained in the definition of “organised crime” in s 2 OSCO are present that the OSCO regime may need to be engaged.

The investigative and search powers under OSCO:

44.  An important part of the OSCO regime is the power of the Court of First Instance or the District Court to make confiscation orders in respect of the proceeds of crime.  Confiscation orders may be made under s 8 OSCO, in respect of the proceeds of any of the crimes in Schedule 1, or Schedule 2 of OSCO.  Plainly, in order to seek confiscation orders information must be obtained as to the proceeds of crime.  This will usually involve tracing funds through banks and similar institutions, and in appropriate occasions solicitors or accountants offices, or the offices of semi-professionals offering managerial or quasi-accounting assistance to the public.  I shall refer to this latter group collectively as “management offices”. Thus, the question of obtaining information from such offices, those offices, usually having been innocently used by offenders in processing the fruits of crime, needed to be dealt with in OSCO.

45.  In the course of investigation into a crime it will usually be the premises occupied by, or used or frequented by, a suspected person that will be the primary place at which a search for evidence of that crime might be undertaken.  In such circumstances it is entirely appropriate that both police officers and ICAC officers should be able to go to the magistrate’s court and obtain a search warrant without any prior notification to the suspected person or the occupier of premises.  It is equally appropriate that such a search warrant should be able to be executed at any time of the day or night.

46.  However, it will be immediately apparent that the evidence required for a confiscation order, or a s 25 OSCO offence, in circumstances when the latter falls within the definition of organised crime, will invariably involve documentation held by entities such as banks, solicitors, accountants, or management offices, for those entities may well have been involved, perfectly innocently, in dealing with money in particular, that may be the proceeds of an indictable offence.  A banker or solicitor may have no reason to question the source of funds placed with them by a client, and may perfectly innocently act upon instructions in relation to those funds thereby unknowingly facilitating an offender in dealing with the proceeds of his offence.  The documents created in the course of such steps will be highly relevant to the prosecution of the person alleged to have committed the offence.

47.  It is clear from the structure of OSCO that the legislature was required to balance, on the one hand the plain need of society that the proceeds of indictable offences should be traced, recovered, and offenders prosecuted, and on the other hand, the proper obligations of bankers solicitors, accountants, or managers, of confidence or confidentiality, and that their places of work should not be unnecessarily or unreasonably entered on a compulsive basis.

48.  A search warrant carries with it a power of forcible entry, and may be executed at any time.  In passing OSCO however, the legislature has, in effect, acknowledged that:

“…..there are places for which authorisation to search should generally be granted only with reticence and, where necessary, with more conditions attach them for other places.  One does not enter a church in the same way as a lion’s been, or a warehouse in the same way as a lawyer’s office.  One does not search the premises of a third-party who was not alleged to have participated in the commission of a crime in the same way as those of someone who was the subject of such an allegation:”

per Lamar J in Descoteaux v Mierzwinski & Attorney General of Quebec (1982) 141 DLR (3d) 615-616.

49.  The legislature has recognized this principle by making specific provisions in OSCO which have the effect of considerably ameliorating the usual draconian powers accompanying an ordinary search warrant.  These specific provisions, are contained in Part II, OSCO, entitled “Powers of Investigation”.

50.  By s 3 and s 4 OSCO, provision is made for two alternative steps, lesser than the draconian power of search warrant, as a first step which will almost always need to be undertaken before a search warrant may be obtained.  They are first, by s 3, a requirement to furnish information or produce material, and second, by s 4, an order to make material available.

The s 3 procedure:

51.  The “requirement to furnish information or produce material” under s 3 is a step that may only be taken by the Secretary for Justice.  The Secretary for Justice may, for the purpose of an investigation into an organised crime, make an ex parte application to the Court of First Instance for an order authorising the Secretary for Justice to require the person in respect of whom the order was made to answer questions, furnish information, or produce material. 

52.  A pre-requisite to the making of such an order is that there must be reasonable grounds for believing that the making of the order is in the public interest having regard to four criteria.  They are, (i) the seriousness of the organised crime under investigation, (ii) whether or not the organised crime could be effectively investigated if the order were not made, (iii) the benefit likely to accrue to the investigation if the information is disclosed or material obtained, and (iv) the circumstances under which the person may have acquired, or may hold the information or material, including any obligation of confidentiality in respect of the informational material and any family relationship they person to whom the information or material relates: see s 3(4)(d).  Section 3(9) specifically exempts material subject of legal professional privilege from being the subject of a requirement.

53.  The legislation requires that Rules of Court shall be made in respect of such applications.  Order 116 RHC contains the rules in relation to applications under ss 3, 4 and 5 OSCO.

The s 4 procedure:

54.  Section 4 provides for an “order to make material available”.  An application under the section may be made either by the Secretary for Justice, or an authorised officer.  An “authorised officer” is defined by s 2(1) as any police officer, any member of the Customs and Excise Service, or any other person authorised in writing by the Secretary for Justice for the purposes of OSCO.  ICAC officers are not generally included, and must be specifically authorised in writing by the Secretary for Justice.

55.  Again, ex parte application is made to the Court of First Instance for an order that a person who appears to the court to be in possession or control of material produced the material to an authorised officer to take away, or to give him access to it.

56.  It is a prerequisite to the making of an order that there must be reasonable grounds for believing that making the order is in the public interest having regard to, (i) the benefit likely to accrue to the investigation if the material is obtained, and (ii) the circumstances under which the person in possession or control of the material holds or controls it: see s 4(4)(d).  Again, an order cannot be made in relation to items subject to legal professional privilege.

The s 5 search warrant procedure:

57.  Authority for a search warrant is contained in s 5.  Under s 5(1)(c), an authorised officer may, for the purpose of an investigation into the proceeds of a specified offence of any person who has committed, or is suspected of having committed, that specified offence, apply to the Court of First Instance or the District Court for a warrant in relation to specified premises.

58.  Again, there are prerequisites to the issue of a search warrant.  First, by s 5(2) the court must be satisfied either, (a) that a requirement imposed under s 3 has not been complied with; or, (b) that an order under s 4 has not been complied with, or; (c) the conditions contained in s 5(3)(a), (c) and (d) or s 5(3)(b), (c) and (d) are fulfilled; or, (d) the conditions contained in s 5(4)(a), (c) and (d) or s 5(4)(b), (c) and (d) are fulfilled.  It is important to note that the pre-requisites established by s 5(2) in the alternative.  Accordingly an authorised officer seeking a search warrant must satisfy the court that at least one of those conditions has been fulfilled.

59.  Where steps have not first been taken to obtain either a requirement to furnish information or produce material pursuant to s 3, or an order to make material available pursuant to a 4, one of the requirements in s 2(3)(c) or (d), that is the appropriate combination of conditions in s 5(3) and (4), must be fulfilled.

60.  It is accordingly appropriate to set out in full s 5(3) and (4):

“(3)   The conditions referred to in subsection (2)(c) are-

(a)     where the investigation is into an organized crime, that there are reasonable grounds for suspecting that the organized crime has been committed;

(b)     where the investigation is into the proceeds of organized crime or a specified offence of a person-

(i)      that the person has committed an organized crime or that specified offence, or that there are reasonable grounds for suspecting that he has committed an organized crime or that specified offence; and

(ii)     that there are reasonable grounds for suspecting that the person has benefited from organized crime or that specified offence;

(c)          that the conditions in section 4(4)(c) and (d) are fulfilled in relation to any material on the premises;

(d)          that it would not be appropriate to make an order under that section in relation to the material because-

(i)      it is not practicable to communicate with any person entitled to produce the material; or

(ii)     it is not practicable to communicate with any person entitled to grant access to the material or entitled to grant entry to the premises on which the material is situated; or

(iii)     the investigation for the purposes of which the application is made might be seriously prejudiced unless an authorized officer could secure immediate access to the material.

(4)     The conditions referred to in subsection (2)(d) are-

(a)     where the investigation is into an organized crime, that there are reasonable grounds for suspecting that the organized crime has been committed;

(b)     where the investigation is into the proceeds of organized crime or a specified offence of a person-

(i)      that the person has committed an organized crime or that specified offence, or that there are reasonable grounds for suspecting that he has committed an organized crime or that specified offence; and

(ii)     that there are reasonable grounds for suspecting that the person has benefited from organized crime or that specified offence;

(c)     that there are reasonable grounds for suspecting that there is on the premises material which is likely to be relevant to the investigation for the purpose of which the application is made, but that the material cannot at the time of the application be particularized;

(d)     that-

(i)      it is not practicable to communicate with any person entitled to grant entry to the premises; or

(ii)     entry to the premises will not be granted unless a warrant is produced; or

(iii)     the investigation for the purposes of which the application is made might be seriously prejudiced unless an authorized officer arriving at the premises could secure immediate entry to them.”

61.  Of these, the most significant for present purposes are those contained in s 5(3)(d) and s 5(4)(d). 

62.  Under s 5(3)(d), an applicant for a warrant must establish that it would not be appropriate to make an order requiring a person to furnish information or produce material under s 3, either, because it is not practicable to communicate with any person entitled to produce the material or the investigation might be seriously prejudiced unless an authorised officer could secure immediate access to the material. 

63.  Plainly these conditions are generally unlikely to be fulfilled in relation to banks, solicitors, accountants or managers.  It is difficult to envisage a situation where it would not be practicable to communicate with the appropriate persons in those institutions.  It is equally difficult to imagine a situation where, armed with either a s 3 requirement or a s 4 order, and investigator would not be able to secure immediate access to the material.  It may be safely assumed that bankers, solicitors, and accountants and the like, when presented with such a requirement or order, would immediately comply.  That that is so may be seen from the level of co-operation afforded by the Applicants in the present case when the ICAC investigators entered the premises and disclosed the reasons for their presence.

64.  Under s 5(4)(d), similar circumstances arise in relation to an order to make material available under s 4.  Again, for precisely the same reasons, it is difficult to envisage a situation where it would not be practicable to communicate with the appropriate persons or the investigation might be seriously prejudiced unless an authorised officer could secure immediate access to the material.

65.  The foregoing review of the powers of investigation contained in OSCO leads me to conclude that the legislature has taken specific and careful steps to ensure that whenever an investigation into organised crime is being undertaken, a particular regime must be followed when investigators require information from innocent third parties such as banks, solicitors, accountants or management offices. 

66.  The regime that has been established is one that premised on the basis that, with respect of those types of parties, preferably, steps should be taken that are less intrusive or draconian than a search warrant, and that a search warrant should only be able to be obtained in limited, particularised, circumstances.

67.  Consequently, where in the course of the investigation into organised crime there is no difficulty in communicating with a person entitled to grant entry to premises, and it is unlikely that the investigation will be prejudiced by the inability of an investigator to secure immediate entry to the premises, it will usually be the case that there will be no entitlement to a search warrant. 

68.  This will be the invariable scenario in respect of banks, solicitors, accountants and management offices.  Consequently, the proper procedure for an investigator to follow when wishing to obtain information or material in relation to an offence under s 25(1) OSCO, when that offence is, as here, and organised crime, will invariably be by way of application to the Court of First Instance under s 4 OSCO, for an order that the solicitor make the specified material available.

69.  I have set out the foregoing review of the provisions of OSCO in order to demonstrate the legislative intention that when investigating organised crime pursuant to OSCO, search warrants should generally not be available to investigators in respect of offices such as banks, solicitors, accountants or management offices.

ICAC are obliged to follow the OSCO procedure:

70.  ICAC officers are not specifically referred to as being authorised officers entitled to seek an order under s 4 or a warrant under s 5.  However and ICAC officer may be authorised for the purposes of OSCO, by the Secretary for Justice.  Mr McCoy’s argument was that, in the absence of a specific reference to ICAC officers as authorised officers, they were entitled to rely upon the power of search contained in s 10 ICACO.  He argued that that power extended to the obtaining of a search warrant in the course of investigating a s 25(1) OSCO offence, in circumstances when that offence constitutes an organised crime.

71.  Mr Dykes relied upon the principal of construction that general words do not to derogate from specific words, and the following passage from Bennion, Statutory Interpretation: A Code, 4^th Ed. P 998:

“Where the literal meaning of a general enactment covers a situation for which specific provision is made by some other enactment within the Act or instrument, it is presumed that the situation was intended to be dealt with by the specific provision.  This is expressed in the maxim generalibus specialia derogant (special provisions override general ones).  Acts very often contain general provisions which, when read literally, cover a situation for which specific provision is made elsewhere in the Act.  This maxim gives a rule of thumb for dealing with such a situation: it is presumed that the general words are intended to give way to the particular.  This is because the more detailed a provision is, the more likely it is to have been tailored to fit the precise circumstances of a case falling within it.”

72.  This explanation of the principle deals with circumstances where, within an Act, general words are present, as well as specific words, the latter referring to a situation encompassed by the general words.  Bennion at p 998, cites Professor Pearce in his work, Statutory Interpretation in Australia, 2^nd Ed p 47, where it is said that it is common sense that the draughtsman would have intended the general provisions to give way should they be applicable to the same subject matter as is dealt with specifically.  That must be right.

73.  The principle has been held to extend to circumstances where the special provision is contained in later legislation: see Richards v Richards [1984] 1 AC 174, see especially the speech of Lord Hailsham of St Marylebone at 199 where he said:

“… in my opinion, where, as here, Parliament has spelt out in considerable detail what must be done in a particular class of case it is not open to litigants to bypass the special Act, nor to the courts to disregard its provisions by resorting to the earlier procedure, and thus chose to apply a different jurisprudence from that which the Act prescribes.”

74.  I respectfully agree.  In my view it is equally a matter of common sense that specific powers in relation to specific circumstances in subsequent legislation should qualify a general power in earlier legislation where, the general scope within which the power may be exercised encompasses the specific circumstances.

75.  I am clearly of the view that these principles ought to apply in the present circumstances. 

76.  The legislature has given to ICAC a power to obtain search warrants in relation to the general group of offences which, under its authorising legislation it is entitled to investigate.  Subsequently, the legislature has passed legislation to deal with a specific group of offences, collectively referred to as “organised crime”.  The consequence of OSCO is that the general group of offences which ICAC may investigate will include, in certain circumstances, offences which now fall within a specific group designated as “organised crime”.  The legislature has made it clear that when investigating organised crime it requires a specific procedure to be followed in respect of obtaining information from certain third parties.  It has, to adopt the words of Lord Hailsham, spelt out in considerable detail what must be done in a particular class of case.

77.  I have no doubt at all that it was not intended that ICAC should be able to bypass the special provisions contained in OSCO, and, together with the courts, disregard its provisions by resort to the general procedure contained in the ICACO.

78.  Mr McCoy contended that the provisions in the ICACO were specific provisions and that accordingly the principle ought not to apply.  The response is obvious.  If they are specific provisions, those in OSCO are more specific.  Plainly, the same principle must apply.

79.  I accordingly hold that when, pursuant to the powers under s 10 ICACO, ICAC are entitled to investigate offences of organised crime, as defined in OSCO, ICAC officers are obliged, if they wish to obtain information from third parties, to follow the procedures set down in s 4 & 5 OSCO.

Certiorari to issue:

80.  It follows that the decision of the magistrate to issue the warrants, having been made without jurisdiction, the warrants must be quashed.  It further follows that the decision of the Commissioner of the ICAC to seize and detain documents and materials located pursuant to the warrants must equally be quashed.  An order of certiorari must issue accordingly.

81.  In case there should be concern that the foregoing conclusion will hamper the power of ICAC in appropriate cases to obtain a search warrant I should make it clear that I cannot imagine any circumstances in which the premises occupied by or used by a suspected person would not meet the qualifying words in s 5(4)(d)(i), (ii) or (iii).  Consequently ICAC will have no difficulty at all, once the investigator has been duly authorised, in obtaining a warrant to search a suspected person's premises.

The Shatin documents:

82.  The documents which have been described as the “Shatin documents” fall within quite a different category from those deceased from the Applicants’ office premises in Admiralty Tower. 

83.  The evidence establishes that when the ICAC officers entered the premises they showed the Applicants the warrants and requested assistance in retrieving the relevant material.  It was agreed that the ICAC officers would not be required themselves to physically conduct the search, and the Applicants themselves would locate the appropriate documents and deliver them to the investigators.  The ICAC officers remained throughout in a conference room and the documents were seized were brought to them.

84.  In the course of this exercise the ICAC investigators were informed that some documents were stored in a godown in Shatin.  Steps were taken by the Applicants to retrieve those documents and late in the day they were brought to the conference room and handed to the ICAC officers.

85.  Mr McCoy correctly reminds me that the search warrants related solely to premises on the 23/F, Admiralty Centre, Tower II, 18 Harcourt Rd., Hong Kong.  The warrants did not permit a search of a Shatin godown.  Mr McCoy contended that by voluntarily retrieving the documents from a place not mentioned in the search warrant, there was a voluntary transmission of those documents by the Applicants to ICAC, and that those documents were not and cannot be covered either by the search warrants, or be the subject of any relief in the Judicial Review Proceedings.

86.  No authority was cited for the proposition but I think it must be right.  If a person voluntarily supplies documents or exhibits to an investigator they cannot later be heard to say that they have changed their mind.  The only reason proffered for challenging the continued retention of the Shatin documents by ICAC, (other than a legal professional privilege issue to which I shall shortly refer), was that the warrants were invalid.  That argument plainly cannot apply to documents voluntarily delivered from premises not covered by the warrants.

87.  ICAC are entitled to retain and use the Shatin documents.

The disposition of the documents:

88.  The warrants have been found to be invalid, and accordingly, strictly, there ought to be an order requiring the ICAC to return the documents recovered from the Admiralty Tower premises to the Applicants.  It is abundantly plain however had an appropriate application be made to the Court of First Instance, or the District Court for a s 4 order, such an order would have been granted.  In those circumstances ICAC would have been perfectly entitled to retain the documents.

89.  It seems to me that an appropriate arrangement should be reached between the parties in order that the integrity of the documents is maintained and the appropriate formal procedures may be followed.  In this way there can be no subsequent objection to the documents being used in appropriate proceedings in Hong Kong.

90.  In this respect, leave is reserved to apply.

Legal Professional Privilege:

91.  It was suggested in the Application for Judicial Review that a question of legal professional privilege might arise in respect of some of the documents seized.  As I understand Mr Dykes’ position however, at the end of the day it is plain having regard to the nature of the documents that no issue of legal professional privilege arises.

92.  In the circumstances I do not deal with the argument, based upon the recent New Zealand Court of Appeal decision in A Firm of Solicitors v District Court at Auckland [2006[ 1 NZLR 586 in which the court observed, in relation to searches involving law firms with was usually a plain issue of legal professional privilege, that the warrant should, in a similar manner to an Anton Piller order, contain appropriate safeguards in respect of legal professional privilege.

93.  That is an issue which is presently before the Court of Appeal in Hong Kong, argument having been heard and the decision reserved, (see Rmbsa Corporate Services Ltd & Anor v Secretary for Justice CACV 327/2006). 

94.  It is plain from the facts in the present case that all of the parties were fully alive to the issue of legal professional privilege.  Right at the start the ICAC investigators assured the solicitors that anything seized from the solicitors firm would be placed in a sealed container, and the seal would not be broken before the expiry of seven days from the date of the seizure, within which period the solicitors may institute legal proceedings to establish the claim of legal professional privilege.  The evidence, unchallenged, was that the ICAC officer had informed the magistrate that this procedure would be adopted when making application for the warrant.

95.  It is clear therefore that ICAC, at least, appropriately conscious of the issue of legal professional privilege when dealing with law firms.  In those circumstances it may be thought that it is unnecessary to burden a warrant with conditions relating to legal professional privilege.  But there is no doubt that the inclusion of appropriate provisions, in accordance with the New Zealand practice, would be an ideal practice.

96.  As the matter was not the subject of detailed argument before me, I say no more than that.

The right to a copy of the warrants:

97.  The evidence established that upon entry the premises the solicitors asked for a photocopy of the two search warrants.  They were told that it would be necessary to make a written request to ICAC for a copy, and were only permitted to make a typewritten copy of the warrants.  I have no doubt at all that the solicitors would have had a photocopy machine readily available. 

98.  There is no sensible reason at all why the ICAC officers should have refused the solicitors the opportunity to make a photocopy of the warrants.  I trust that in future, when dealing with people who are believed by ICAC to have been innocently used by criminals, the situation will not occur again, and that a photocopy of the warrant may be taken when access has been gained to premises.

The claim for damages:

99.  The relief sought in the Application includes a claim for damages and trespass to goods, to be assessed.  Order 53 r 7 entitles the judge to award damages if a claim has been made in the Application.  No argument was addressed to me on the question of damages, the parties are sensibly leaving that matter for consideration and determination once the outcome of the primary issue was resolved.

100.  Leave is reserved for the parties to apply for directions to determine the future course of the trial on the question of damages.

Costs:

101.  As there are outstanding matters costs are reserved at this stage.