HKSAR v. MA WAI KWAN DAVID AND OTHERS

IN THE HIGH COURT OF THE HONG KONG

SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

Reservation of Question of Law No. 1 of 1997

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J U D G M E N T

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Chan, Chief Judge :

Background

1. The respondents are the three defendants in a criminal trial before the Court of First Instance. They were charged on 11th August 1995 with conspiracy to pervert the course of public justice, contrary to common law. It is alleged that between 12th and 29th June 1995, the three respondents conspired together by offering to pay money to the mother of a Mr Wong who was then charged with robbery before the District Court together with the 3rd respondent and another person. It is further alleged that the purpose of offering money to the lady was to serve as a reward for her son Mr Wong pleading guilty to a lesser offence and maintaining a false version of events which would favour the 3rd respondent and the other person. They were committed for trial in the then High Court after a preliminary inquiry which took several days in December 1996. On 3rd January 1997, Indictment No.1 of 1997 was filed against them. The 3rd respondent also faced an alternative charge of attempting to pervert the course of public justice.

2. The trial was fixed for hearing on 16th June 1997. The first few days were spent on sorting out prosecution witness statements and other documents. On the fifth day of the trial, the 2nd respondent applied for a permanent stay of the criminal proceedings. This lasted several days. On 27th June 1997, the last working day before 1st July, the trial judge, Deputy Judge Lugar-Mawson, refused to stay the proceedings.

3. On 3rd July 1997, the tenth day of the trial, the respondents took issue on the Reunification Ordinance, the Basic Law and the preservation of the common law. On 7th July 1997, which was the twelfth day of the trial, the three respondents were, with their consent, arraigned on an amended indictment which was filed on 19th June 1997. They all pleaded not guilty to the first count of conspiracy to pervert the course of public justice. The alternative count against the 3rd respondent was directed by the Court to be put on file, not to be proceeded with without the leave of the Court. The respondents then applied to the Deputy Judge to quash the Amended Indictment. The prosecution opposed this application and applied to reserve certain questions of law for the determination by the Court of Appeal pursuant to section 81 of the Criminal Procedure Ordinance, Cap.221. There was no objection from the respondents. The Deputy Judge made the order.

4. On 9th July 1997, at a hearing for directions before us, we drew the parties' attention to s.81 of Cap 221 which provides that the questions of law reserved for this Court must be on matters arising from the trial. On the following day, the parties went before the Deputy Judge. His order was amended, apparently with the consent of all parties. This is now before this Court.

Representation of the parties

5. I should mention that since the questions of law to be determined by this Court involve some important constitutional issues, we requested the Director of Legal Aid to brief leading counsel for the 3rd respondent. However, as it turned out, the Director decided not to do so and was prepared only to instruct junior counsel to hold a watching brief. Pursuant to our directions, counsel for the 2nd respondent filed his skeleton arguments on the questions of law to be decided. Counsel for the 1st respondent indicated that he would adopt those submissions.

6. On the first day of this hearing, counsel for both the 2nd and 3rd respondents informed us that they had no instructions to act for their clients because of lack of funds. They asked to be released from the case. We gave leave to the solicitors to withdraw but invited both counsel to stay and make submissions on the issues before the Court. They agreed to do so. In the afternoon, Ms Gladys Li, SC, Miss Margaret Ng and Mr Paul Harris appeared before us and offered to assist the Court on the issue of the legality of the Provisional Legislative Council. Counsel for the 2nd and 3rd respondents were willing to be led by this team in view of the importance of the issue involved. We readily extended our invitation to Ms Li, SC, and her team. We are most grateful for their assistance.

The two questions of law

7. There were initially five questions of law for the determination of this Court stated in the Motion issued by the prosecution and the Order made by the Deputy Judge. I am given to understand that they were framed in order to cover the grounds relied on by the 2nd respondent in his application to quash the Amended Indictment. Having reconsidered the matter, the prosecution decided to pose only two questions for determination. They are :

(1) Is the offence at common law of conspiracy to pervert the course of public justice part of the laws of the Hong Kong Special Administrative Region ("HKSAR")?

(2) Are the accused liable to answer to and to be tried on count 1 of the Indictment No.1 of 1997 ?

Survival of the common law

8. It is the respondents' contention that the common law has not survived the change of sovereignty on 1st July 1997. Their main submission is that the Basic Law, in particular Article 160, provides that the laws previously in force in Hong Kong which include the common law, rules of equity, ordinances, subordinate legislation and customary law shall be adopted. They argue that it is necessary to have a positive act of adoption either by the National People's Congress (NPC) through its Standing Committee and/or the legislature of the HKSAR. It is submitted that there was no valid adoption of these laws by the NPC or its Standing Committee and that the legality and competence of the Provisional Legislative Council is in doubt. Furthermore, the NPC Standing Committee had "repealed" the Application of English Law Ordinance (Cap 88) as contravening the Basic Law. As a result, the common law has not survived the change of sovereignty and there is no common law in Hong Kong after 1st July.

9. Leading counsel for the Government submits that under the Basic Law itself, the common law forms part of the laws of HKSAR. No formal act of adoption of the law previously in force is necessary. A decision is required only to declare which of the laws that are in contravention of the Basic Law are not to be adopted. In any event, the NPC Standing Committee had indeed adopted all the laws previously in force which are not in contravention of the Basic Law. The Reunification Ordinance has not adopted or purported to adopt the common law since that Ordinance was enacted on the basis that the laws previously in force have already been adopted. Counsel submits that the NPC decision not to adopt the Application of English Law Ordinance does not affect the maintenance of the common law in Hong Kong.

10. The answer to the question whether the common law has survived the change of sovereignty depends on whether the laws previously in force in Hong Kong are automatically adopted upon the establishment of the HKSAR on 1st July 1997 or whether it is necessary to have an overt act of adoption of such laws and if so, whether there has been any valid adoption. This turns on an interpretation of the provisions of the Basic Law.

Interpretation of the Basic Law

11. Before one attempts to interpret the Basic Law, it is necessary to bear in mind the history, nature and purpose of this document.

12. On 19th December 1984, the Joint Declaration was signed between the Government of the People's Republic of China (PRC) and the Government of the United Kingdom. By this Joint Declaration, Hong Kong was to be restored to China with effect from 1st July 1997. Under Article 3 of the Joint Declaration, China declared certain basic policies regarding Hong Kong. There was to be established the HKSAR which would enjoy a high degree of autonomy. Under Article 3(12), these basic policies would be stipulated in a Basic Law to be promulgated by the NPC and would remain unchanged for fifty years from 1st July 1997. These policies were further elaborated in Annex I to the Joint Declaration. The Basic Law for the HKSAR was drafted by the Drafting Committee of the Basic Law which consisted of members from China and from Hong Kong. It took many years to complete. It was promulgated on 4th April 1990 and was to take effect from 1st July 1997.

13. The Basic Law is not only a brainchild of an international treaty, the Joint Declaration. It is also a national law of the PRC and the constitution of the HKSAR. It translates the basic policies enshrined in the Joint Declaration into more practical terms. The essence of these policies is that the current social, economic and legal systems in Hong Kong will remain unchanged for 50 years. The purpose of the Basic Law is to ensure that these basic policies are implemented and that there can be continued stablity and prosperity for the HKSAR. Continuity after the change of sovereignty is therefore of vital importance.

14. Mr Fung, SC, for the Government submits that a generous and purposive approach is to be adopted in the interpretation of the Basic Law since it is a constitutional document. See A.G. of Gambia v. Jobe [1984]AC 689 and R. v. Sin Yau-ming [1992] 1 HKCLR 127. While I agree with this as a general proposition, I would add a few words of caution. The Basic Law is a unique document. It reflects a treaty made between two nations. It deals with the relationship between the Sovereign and an autonomous region which practises a different system. It stipulates the organisations and functions of the different branches of government. It sets out the rights and obligations of the citizens. Hence, it has at least three dimensions : international, domestic and constitutional. It must also be borne in mind that it was not drafted by common law lawyers. It was drafted in the Chinese language with an official English version but the Chinese version takes precedence in case of discrepancies. That being the background and features of the Basic Law, it is obvious that there will be difficulties in the interpretation of its various provisions. (See the discussions in Hong Kong's New Constitutional Order, Yash Ghai, Chapter 5.) In my view, the generous and purposive approach may not be applicable in interpreting every article of the Basic Law. However, in the context of the present case which involves the constitutional aspects of the Basic Law, I agree that this approach is more appropriate.

Relevant provisions in the Basic Law

The provisions

15. The provisions in the Basic Law which are relevant to the issue of whether the common law has survived the change of sovereignty are as follows :

"Article 8

The laws previously in force in Hong Kong, that is, the common law, rules of equity, ordinances, subordinate legislation and customary law shall be maintained, except for any that contravene this Law, and subject to any amendment by the legislature of the Hong Kong Special Administrative Region.

Article 18

The laws in force in the Hong Kong Special Administrative Region shall be this Law, the laws previously in force in Hong Kong as provided for in Article 8 of this Law, and the laws enacted by the legislature of the Region.

Article 19

The Hong Kong Special Administrative Region shall be vested with independent judicial power, including that of final adjudication.

The courts of the Hong Kong Special Administrative Region shall have jurisdiction over all cases in the Region, except that the restrictions on their jurisdiction imposed by the legal system and principles previously in force in Hong Kong shall be maintained.

Article 81

The Court of Final Appeal, the High Court, district courts, magistrates' courts and other special courts shall be established in the Hong Kong Special Administrative Region. The High Court shall comprise the Court of Appeal and the Court of First Instance.

The judicial system previously practised in Hong Kong shall be maintained except for those changes consequent upon the establishment of the Court of Final Appeal of the Hong Kong Special Administrative Region.

Article 87

In criminal or civil proceedings in the Hong Kong Special Administrative Region, the principles previously applied in Hong Kong and the rights previously enjoyed by parties to proceedings shall be maintained.

Article 160

Upon the establishment of the Hong Kong Special Administrative Region, the laws previously in force in Hong Kong shall be adopted as laws of the Region except for those which the Standing Committee of the National People's Congress declares to be in contravention of this Law. If any laws are later discovered to be in contravention of this Law, they shall be amended or cease to have force in accordance with the procedure as prescribed by this Law.

Documents, certificates, contracts, and rights and obligations valid under the laws previously in force in Hong Kong shall continue to be valid and be recognized and protected by the Hong Kong Special Administrative Region, provided that they do not contravene this Law.

(my emphases)

16. These are the provisions with regard to the laws which are to be in force, the judicial system which are to be in place and the principles relating to legal proceedings which are to be applied in the HKSAR.

Its intention

17. In my view, the intention of the Basic Law is clear. There is to be no change in our laws and legal system (except those which contravene the Basic Law). These are the very fabric of our society. Continuity is the key to stability. Any disruption will be disastrous. Even one moment of legal vacuum may lead to chaos. Everything relating to the laws and the legal system except those provisions which contravene the Basic Law has to continue to be in force. The existing system must already be in place on 1st July 1997. That must be the intention of the Basic Law.

Its wording

18. The wording is equally clear. The Basic Law is the constitution of the HKSAR. It is the most important piece of law in the land. It states clearly what the position is as from 1st July 1997. In my view, the word "shall" in these provisions can only be used in the mandatory and declaratory sense. The meaning of these provisions is this. On 1st July 1997 when the HKSAR comes into existence and the Basic Law comes into effect, these are to be the laws and legal system in force and the principles applicable in the place. There is no express or implied requirement in any of these provisions that the laws previously in force or the legal system previously in place need to be formally adopted before they can continue to be applicable after the change of sovereignty. On the contrary, the use of the terms "shall be maintained", "shall continue" and "shall be" leaves absolutely no doubt in my mind that there can be no question of any need for an act of adoption. These terms are totally inconsistent with such a requirement.

Article 160

19. The respondents' argument is based mainly on Article 160 which uses the words "shall be adopted". It is suggested that "shall" in this term is used in the future tense. In my view, that provision cannot be read in isolation but must be considered in the light of the rest of the Basic Law including in particular the articles to which I have referred above. It cannot be construed to have a meaning which is inconsistent with the other articles relating to the adoption of the existing laws and legal system.

20. In any event, Article 160 even on its own has the same theme as the other provisions. There is a sense of continuity in this article. In the first paragraph of this article, it is provided that any laws which are later to be found to be in contravention of the Basic Law shall be amended or cease to have force. Laws which have not yet come into force cannot cease to have force. In my view, this paragraph clearly indicates that the laws previously in force in Hong Kong are to be effective on 1st July 1997 without any act of adoption. Paragraph 2 of that article puts the matter beyond argument. It provides that documents, certificates, contracts, rights and obligations valid under the laws previously in force shall continue to be valid. How can these continue to be valid if the laws which govern their validity cannot even apply without an act of adoption ? It simply makes no sense that the Basic Law continues the validity of these documents, certificates, contracts, rights and obligations but requires the laws which upholds them to be adopted.

21. I would also agree that apart from confirming that the laws previously in force are to be the laws of the HKSAR at the time the Region comes into existence, the purpose of Article 160 is to provide for the exclusion of laws which are later found to be in contravention of the Basic Law.

22. Construing Article 160 either by itself or in conjunction with the other articles, I am firmly of the view that it does not have the effect of requiring the laws previously in force in Hong Kong to be formally adopted in order to be effective after 30 June 1997. In fact, no other article in the Basic Law has such effect.

Joint Declaration

23. I find support for this view in the provisions in the Joint Declaration which can be used as an aid to the interpretation of the Basic Law. Article 3 provides:

"Article 3(3)

The Hong Kong Special Administrative Region will be vested with executive, legislative and independent judicial power, including that of final adjudication. The laws currently in force in Hong Kong will remain basically unchanged.

Article 3(12)

The above stated basic policies of the People's Republic of China regarding Hong Kong and the elaboration of them in Annex I to this Joint Declaration will be stipulated, in a Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China, by the National People's Congress of the People's Republic of China, and they will remain unchanged for 50 years."

24. It is quite clear that the Joint Declaration is a declaration of intent. It evinces the intention of the two Governments and refers to what is to happen in future. Hence the future tense is used. Contrast Annex I to the Joint Declaraion which was to form the basis of the Basic Law. The first paragraph in Section II says :

"After the establishment of the Hong Kong Special Administrative Region, the laws previously in force in Hong Kong (i.e. the common law, rules of equity, ordinances, subordinate legislation and customary law) shall be maintained, save for any that contravene the Basic Law and subject to any amendment by the Hong Kong Special Administrative Region legislature. (my emphasis)

25. The wording is in line with Article 8 of the Basic Law. The inevitable conclusion is that "shall" is not used in the future sense but in the mandatory and declaratory sense.

Chinese text

26. Mr Fung, SC, for the Government draws our attention to the fact that the Basic Law was enacted in the Chinese language by the PRC and that the Chinese text prevails over the English version in case of discrepancies. When the relevant articles in the Chinese text are considered, there can be no doubt as to what they mean or are intended to mean. The Chinese characters "採用 cai yong" (meaning "adopt") in Article 160 are clearly used in the mandatory and declaratory sense. They do not admit of an interpretation which requires a future act of adoption before the laws previously in force are to be applicable after 1st July 1997. However, I do not think it is necessary to rely on the Chinese text at all. The English text is already quite clear and without ambiguity.

Adoption by NPC Decision

27. It is submitted on behalf of the respondents that the NPC saw fit to make a Decision on 23rd February 1997 which purported to adopt the laws previously in force. This, it is argued, suggests that it is necessary to have an act of adoption before such laws can become effective after 1st July 1997. In my view, this argument cannot be sustained in the light of the purpose and contents of that Decision.

28. The Decision on 23rd February 1997 was made for the expressed purpose of exercising the NPC's right under Article 160 of the Basic Law to declare which laws previously in force contravene the Basic Law and are thus excluded from operation after 1st July 1997. The title of the Decision refers to the treatment of laws in accordance with Article 160 and begins with a recital of the relevant part of that article. The reference to Article 8 in fact reinforces the view that the laws previously in force in Hong Kong will automatically become effective as the laws of the HKSAR except for those that contravene the Basic Law. It also supports the view that Article 160 must be read in conjunction with Article 8.

29. Under Paragraph 1 of the Decision, the laws previously in force in Hong Kong are adopted as the laws of the HKSAR. Paragraph 2 refers to those laws which are considered as contravening the Basic Law and therefore not to be adopted when the HKSAR comes into existence. It is also significant to note paragraph 4 which refers to the laws "which have been adopted".

30. In my view, this Decision is clear enough. It adopts the laws previously in force in Hong Kong as the laws of the HKSAR when it comes into existence on 1st July 1997. This is strictly speaking not necessary in the light of the clear provisions in the Basic Law. But since it purports to declare invalid those laws which contravene the Basic Law (as it does), it is natural that it also, for the sake of clarity, refers to the laws which are to be adopted on 1st July 1997.

Application of English Law Ordinance

31. The respondents submit that the Application of English Law Ordinance provided a new basis for the application of the English law and the "repeal" of this Ordinance "throws in doubt the precise scope of the common law to be applied in Hong Kong". I do not agree.

32. English law which includes the common law has started to apply in Hong Kong since at least 1844 when the previous Supreme Court Ordinance was enacted. That Ordinance was replaced by the Application of English Law Ordinance in 1966. The 1966 Ordinance did not import the English law. Nor did it terminate the application of English law which was applied by virtue of the previous Supreme Court Ordinance and then re-apply the English law all over again. It continued the application of the English law. Its effect was, as its long title indicated, "to declare the extent to which English law is in force in the Colony". It set out clearly the restrictions in the application of English law in Hong Kong and listed those imperial acts which were still in force. The reasons for the non-adoption of this Ordinance by the NPC Standing Committee are obvious. The Basic Law has already adopted the laws previously in force. Further, that Ordinance referred to imperial acts which are either not applicable to the HKSAR any more or have been "localised". In other words, that Ordinance is not only no longer necessary, it also contravenes the Basic Law by its incorporation of imperial acts.

33. I do not think the non-adoption of the Application of English Law Ordinance has cast any doubt on the continued application of the common law in the HKSAR.

Cut-off date

34. It is submitted by the respondents that there is an uncertainty in the cut off date of the laws previously in force. They query whether it should be the date of the Joint Declaration in 1984 or the date of the promulgation of the Basic Law in 1990 or 30th June 1997. The relevance of this relates to the common law offence of conspiracy (with which these respondents now face) which was abolished by the Crimes (Amendment) Ordinance 1996.

35. With respect, this point is beyond argument. The cut off date cannot be the date of the Joint Declaration. It was only a treaty and a declaration of intent. It cannot be the date of the promulgation of the Basic Law since it was then stated to take effect on a future date. The Basic Law came into effect on 1st July 1997. It declares in Article 8 and other provisions that the laws previously in force and the existing legal system are adopted. The only logical and in fact proper conclusion is that 30th June 1997 is the cut off date.

36. The respondents are alleged to have committed a conspiracy in June 1995 and they were charged in August 1995. That is one year before the enactment of the Crimes (Amendment) Ordinance 1996. It is clear that the charge is not affected by that amendment. (See s.159E(7)).

Survival of the Indictment

37. The respondents contend that they are not liable to answer to and be tried on the Amended Indictment. The arguments are as follows. The respondents were committed for trial before the resumption of sovereignty. The Indictment was also filed before that date. The Supreme Court before which they appeared had ceased to operate as from 1st July 1997. They should not now be tried before the Court of First Instance of the HKSAR which is not a properly constituted court and the proceedings which were commenced before the resumption of sovereignty cannot be continued. They argue that the reason is because there is no express provision in the Basic Law governing this situation and although there are provisions in the Reunification Ordinance, that Ordinance was not lawfully and validly enacted by a body competent in law to enact it.

38. The answer to these arguments is simple. There are clear and express provisions in the Basic Law. The laws previously in force are adopted (Articles 8 and 18). The courts of the HKSAR have jurisdiction over all cases in the Region (Article 19). The judicial system except the renaming of the Supreme Court and those changes consequent upon the establishment of the Court of Final Appeal is maintained (Article 81). The principles previously applied and the rights previously enjoyed by parties to criminal and civil proceedings are maintained (Article 87). Under Article 160, documents and rights and obligations valid under the laws previously in force continue to be valid, recognised and protected. Adopting a purposive approach to Article 160, these clearly, in my view, cover indictments, the right of the Government to prosecute offenders and the obligation of an accused person to answer to the allegations made against him.

39. I have no doubt that by virtue of the above provisions of the Basic Law, the Amended Indictment survives and the pending criminal proceedings against these respondents continue after the change of sovereignty.

40. The above reasons are sufficient to dispose of the two questions of law reserved for the determination of this Court. The answers to these questions are both clearly in the affirmative.

41. However, in case I am wrong in my interpretation of the Basic Law, I should deal with the other issues which have been raised in argument. I would also do this out of respect to counsel who have so comprehensively prepared their submissions and because of the public concern which has been generated by this important case. I take note of Ms Li, SC's concern over the risk of an unnecessary ruling, by way of obiter, on important issues such as those raised in the present case.

Hong Kong Reunification Ordinance

42. In the event that upon its interpretation, the Basic Law does not provide for automatic adoption of the laws previously in force and the legal system in Hong Kong after 1st July 1997, the Government relies on the Hong Kong Reunification Ordinance (Reunification Ordinance) which is an ordinance passed by the Provisional Legislative Council and assented to by the Chief Executive on 1st July 1997.

43. The long title of the Ordinance sets out what it aims at doing. It reads:

" An Ordinance to confirm the Bills passed by the Provisional Legislative Council before 1 July 1997, endorse the appointment of judges of the Court of Final Appeal and the Chief Judge of the High Court, assist the interpretation on and after 1 July 1997 of laws previously in force in Hong Kong, continue those laws and confirm certain other laws, establish the High Court, the District Court, magistracies and other courts, tribunals and boards, continue legal proceedings, the criminal justice system, the administration of justice and the course of public justice on and after 1 July 1997, continue the public service on and after 1 July 1997, assist the construction of certain documents on and after 1 July 1997, transfer the ownership of certain property and rights and provide for the assumption of certain liabilities on and after 1 July 1997, in consequence of the resumption of the exercise of sovereignty over Hong Kong by the People's Republic of China, and for connected purposes." (my emphases)

Adoption of laws

44. The provisions which relate to the adoption of laws previously in force in Hong Kong are contained in sections 5 and 7 of the Ordinance. Section 5 adds a section to the Interpretation and General Clauses Ordinance, Cap.1. It provides as follows:

"2A. Laws previously in force

(1) All laws previously in force shall be construed with such modifications, adaptations, limitations and exceptions as may be necessary so as not to contravene the Basic Law and to bring them into conformity with the status of Hong Kong as a Special Administrative Region of the People's Republic of China.

(4) In this section -

'laws previously in force' means the common law, rules of equity, Ordinances, subsidiary legislation and customary law in force immediately before 1 July 1997 and adopted as laws of the Hong Kong Special Administrative Region."

The definition of "laws previously in force" suggests that all the previous laws have been adopted as the laws of the HKSAR. This is reinforced by section 7 of the Ordinance which provides :

"7. Maintenance of previous laws

(1) The laws previously in force in Hong Kong, that is the common law, rules of equity, Ordinances, subsidiary legislation and customary law, which have been adopted as the laws of the HKSAR, shall continue to apply." (my emphases)

45. This section supports the view that the Basic Law has already brought all the laws previously in force in Hong Kong into effect as the laws of the HKSAR on its establishment on 1 July 1997. It also puts all matters beyond doubt by stating that such laws shall continue to apply.

Establishment of courts

46. As regards the establishment of the High Court, this is provided in section 8 of the Reunification Ordinance. This section provides that section 3 of the Supreme Court Ordinance (Cap.4) is repealed and substituted by a new section 3 which says:

"3. High Court

(1) There shall be a High Court of the Hong Kong Special Administrative Region consisting of the Court of First Instance and the Court of Appeal.

(2) Subject to the provisions of this Ordinance, the High Court shall be a court of unlimited civil and criminal jurisdiction."

47. The effect of this section is to state clearly that the previous Supreme Court is now renamed as the High Court and the former High Court is now renamed as the Court of First Instance. The argument put forth by the respondents that the Supreme Court ceases to operate after 1 July 1997 is laid completely at rest.

Continuity of proceedings

48. With regard to the continuity of legal proceedings, the relevant provisions are sections 10 and 15. They provide that legal proceedings shall not be affected and shall continue after the change of sovereignty.

"10. Continuity of legal proceedings, criminal justice system and administration of justice

(1) Subject to this Ordinance, the continuity of legal proceedings, the criminal justice system, the administration of justice and the course of public justice shall not be affected by the resumption of the exercise of sovereignty over Hong Kong by the People's Republic of China.

15. Pending proceedings

(1) All proceedings, including appeals, pending in any court, statutory tribunal or statutory board or before any magistrate immediately before 1 July 1997 may be continued on and after that date and shall be treated as if they had been pending in the corresponding court, tribunal or board or before the corresponding magistrate of the HKSAR.

(2) Any proceedings pending in any court, statutory tribunal or statutory board or before any magistrate by or against a public officer immediately before 1 July 197 shall on and after that date be deemed to have been brought by or against, as the case may be, the corresponding public officer in the HKSAR.

(3) Any proceedings brought by, in the name of or against the Queen which are pending in any court, statutory tribunal or statutory board or before any magistrate immediately before 1 July 1997 shall on and after that date be deemed to have brought by, in the name of or against, as the case may be, the HKSAR."

49. I do not need to refer to other provisions which deal with the saving of judgments (section 11), the rights of audience (section 12), and barristers and solicitors (section 13). Suffice it to say that the position has not changed after 1st July 1997 and all acts done by previous courts and tribunals shall be regarded as continuing to have effect.

50. It is therefore clear beyond doubt that even if there is any uncertainty in the Basic Law, this has been removed by the provisions in the Reunification Ordinance which I have mentioned above.

51. The question is whether this Ordinance was lawfully and validly enacted by a body competent in law to enact it. This leads to the legality of the Provisional Legislative Council.

Jurisdiction of the HKSAR Courts

The arguments

52. Mr Fung, SC, for the Government submits that the HKSAR courts have no jurisdiction to hear and determine the issue of the legality of the Provisional Legislative Council. He argues that the courts must accept the body and the laws made by it.

53. It is submitted that under Article 19 of the Basic Law, the jurisdiction of the HKSAR courts shall have jurisdiction over all cases in the Region except the restrictions on their jurisdiction imposed by the legal system and principles previously in force in Hong Kong. Hence, the HKSAR courts have no greater power than the courts under British rule. Counsel argues that prior to 1st July 1997, the Hong Kong courts could not have determined the constitutionality of either UK metropolitan or imperial legislation vis-a-vis either the unwritten English Constitution or the Hong Kong Letters Patent. This was because the UK Government was the sovereign of Hong Kong. According to the constitutional hierarchy, the Acts of Parliament and ministerial decisions were not subject to the Hong Kong Letters Patent and therefore the Hong Kong courts had no jurisdiction to query them. The UK legal system was also different from the Hong Kong system. There would be no effective remedy even if the Hong Kong courts are to query the Acts of Parliament or ministerial Decisions. Counsel relies on the case of Madzimbamuto v. Lardner-Burke [1969] 2 AC 645, in particular the dictum of Lord Reid :

"If Parliament chose to do any of them (the enactment of a Parliament which has effect over South Rhodesia) the courts could not hold the Act of Parliament invalid."

54. It is argued that if British Parliament legislates on a topic within its power, the colonial courts are bound by that. Analogies are drawn from the Australian constitution and the Canadian constitution. Counsel submits that the same principles apply to the HKSAR courts.

55. It is the Government's contention that once the HKSAR courts are satisfied that the Provisional Legislative Council was established, was appointed and is acting under the authority of the Sovereign (the PRC), then the courts have no jurisdiction to question whether it was validly established and are bound to give effect to its enactments. While counsel accepts that the jurisdiction of the HKSAR courts can extend to determining whether the Preparatory Committee was in fact formed by the NPC, they have no power to inquire into the vires of its acts, such as, whether it has acted within its conferred powers or followed the proper procedures or whether it has acted in contravention of the Basic Law. Afterall, counsel argues, the Preparatory Committee is a NPC body and not a HKSAR organisation.

56. On the other hand, Ms Li, SC, submits that the HKSAR courts have the jurisdiction and the obligation to examine and interpret the Basic Law. Hence, they can examine the Basic Law and the acts of the NPC to determine whether the NPC had properly established the Provisional Legislative Council and whether that body conforms with the Basic Law and the NPC enactments. Counsel further argues that the courts can examine the decisions and acts to see if they are consistent with the basic policies of the PRC as stated in the Joint Declaration. She submits that the analogy with Acts of Parliament is not appropriate.

Jurisdiction of the courts

57. I would accept for the arguments put forward by Mr Fung, SC, that regional courts have no jurisdiction to query the validity of any legislation or acts passed by the sovereign. There is simply no legal basis to do so. It would be difficult to imagine that the Hong Kong courts could, while still under British rule, challenge the validity of an Act of Parliament passed in U.K. or an act of the Queen in Council which had effect on Hong Kong. However, I cannot find any authority which prohibits the Hong Kong courts to at least examine whether such legislation or imperial act existed, what its scope was and whether what was done in Hong Kong was done in pursuance of such legislation or imperial act. In fact, it is, in my view, the duty of the Hong Kong courts to ensure that the legislation or imperial act is implemented and if there is to be any query about it, the courts should conduct such an enquiry.

58. Take the example given by counsel. The Queen by Letters Patent appoints Mr X to be a governor of Hong Kong. The Hong Kong courts cannot query the validity of the Letters Patent or why and how she comes to appoint Mr X as the Governor. However, I think that the Hong Kong courts should have the power to examine the Letters Patent and its contents to see whether the Queen has in fact made an appointment and to query whether a particular person turning up at Queen's Pier is the Mr X and whether he acts according to the scope of the Letters Patent which appoints him as Governor.

59. The PRC is the Sovereign of the HKSAR. Under its Constitution, the NPC is the highest organ of state power. Together with its Standing Committee, they exercise the legislative power of the PRC. It is submitted by Mr Fung, SC, although Ms Li, SC, may have some reservations, that the NPC and its Standing Committee can exercise such power by way of decisions and resolutions. In the absence of arguments to the contrary, I would accept that this is the case. The Decisions and Resolutions relied on have also been admitted without challenge.

60. In the context of the present case, I would accept that the HKSAR courts cannot challenge the validity of the NPC Decisions or Resolutions or the reasons behind them which set up the Preparatory Committee. Such decisions and resolutions are the acts of the Sovereign and their validity is not open to challenge by the regional courts. I am thus unable to accept Ms Li, SC's argument that the regional courts can examine those decisions and resolutions to see if they are consistent with the Basic Law or other policies. Nor, in my view, can the HKSAR courts examine why the Preparatory Committee set up the Provisional Legislative Council in exercising the authority and powers conferred on its by the NPC to carry out the Sovereign's decisions and resolutions.

61. However, I take the view that the HKSAR courts do have the jurisdiction to examine the existence (as opposed to the validity) of the acts of the Sovereign or its delegate. In fact, if the matter should ever come to court as in this case, the courts would be failing their duty not to do so. In other words, in the context of this case, I take the view that the HKSAR courts should have the power to examine :

(1) whether there was any NPC decision or resolution setting up or authorising the setting up of the Preparatory Committee,

(2) whether there was any Preparatory Committee decision or resolution setting up the Provisional Legislative Council,

(3) whether the Preparatory Committee had in fact set up the Provisional Legislative Council and whether this Provisional Legislative Council was in fact the body which was set up pursuant to the decisions or resolutions of the NPC and the Preparatory Committee.

62. Once the courts are satisfied with these, I do not think they can go any further.

Legality of the Provisional Legislative Council

The arguments

63. The Government's contention is that the Provisional Legislative Council had been validly established under Chinese law. In any event, its establishment was ratified by the NPC.

64. The Government's first arguments run as follows. On 4th April 1990, the same day as the Basic Law was enacted, a decision was made by the NPC known as "Method for the Formation of the First Government and the First Legislative Council of the HKSAR". This Decision provides for the establishment of a Preparatory Committee in 1996 which was to be responsible for matters relating to the preparation of the establishment of the HKSAR including the first Government and the first Legislative Council in accordance with the Decision. The Decision also makes provisions for the first Legislative Council of the HKSAR and a "through train" so that members of the last Hong Kong Legislative Council who satisfy certain conditions would become members of the first Legislative Council of the HKSAR.

65. It is contended that because of the political dispute, there was to be no "through train". But there is no provision for a contingency in the Basic Law. Hence, the Preparatory Committee decided on 24th March 1996 to establish this Provisional Legislative Council prescribing the specific and limited tasks of this body with limited powers and a specific term of not more than one year until 30th June 1998. Counsel submits that the Preparatory Committee has the primary obligation imposed by the 1990 NPC Decision to establish the HKSAR Government. The establishment of the Provisional Legislative Council is, in the light of prevailing political reality, plainly incidental to that obligation and in the exercise of power conferred by that Decision of the NPC. Counsel submits that the Provisional Legislative Council does not purport to be the first Legislative Council of the HKSAR. It is just an interim body.

66. Ms Li, SC, submits that the Provisional Legislative Council is not legal. She argues that the Joint Declaration provides for the Legislative Council of the HKSAR to be constituted by election. This is also stated in Article 68 of the Basic Law. Any Legislative Council must be established in accordance with that article and the method for formation as prescribed in Annex II which provides, amongst other things, that in the first term, the Legislative Council shall be formed in accordance with the decision of the NPC on the method for the formation of the first Government and the first Legislative Council of the HKSAR. It is submitted that the present Provisional Legislative Council, whatever its name, is the de facto first Legislative Council of the HKSAR. It has purported to fulfill the functions of a Legislative Council for the HKSAR and to enact ordinances which are to have the force of law. It must therefore comply with the Joint Declaration, the Basic Law, which include Annex II and the Decision of the NPC by reference. Counsel submits that the Provisional Legislative Council fails to do so.

67. It is argued that the 1990 NPC Decision does not refer to any Provisional Legislative Council. It mandates the Preparatory Committee to prepare the establishment of the HKSAR and to prescribe the specific method for forming the first Government and the first Legislative Council. But it can do so only in accordance with that Decision. Whilst the NPC left it to the Preparatory Committee to form the first Legislative Council, the Preparatory Committee must comply with criteria set out in paragraph 6 of that Decision. However, the Provisional Legislative Council is admittedly not a Legislative Council which satisfied those criteria. It also contravenes Article 68 of the Basic Law in that it is not constituted by election and not in accordance with the actual situation in the HKSAR or the principle of gradual and orderly progress.

68. It is further submitted that if the NPC Decision has any legislative effect, this would amount to an amendment to the Basic Law. If it is intended to set up a provisional legislature which does not comply with the provisions of the Basic Law and the 1990 NPC Decision, it is necessary to amend the Basic Law. However, there is nothing to show that the special procedures as specified in Article 158 have been followed.

69. It is also argued that nothing in the Decision of the NPC made on 31st August 1994 mandates the Preparatory Committee to form anything other than the first Legislative Council. The Decision of the Preparatory Committee reached on 24th March 1996 on the establishment of the Provisional Legislative Council fails to mention its obligation to prescribe the method for the formation of the first Legislative Council in accordance with the 1990 NPC Decision. In other words, the Preparation Committee did not have powers to do what they did. It is submitted that nothing short of an amendment to the Basic Law can suffice. The NPC "Ratification" in 1997 did not purport to amend the Basic Law.

Events leading to establishment of PLC

70. To decide on the legality of the Provisional Legislative Council, it is necessary to look into the events which led to its existence. The Joint Declaration sets out the declared basic policies of the PRC regarding Hong Kong. These basic policies are elaborated in Annex I and later incorporated in the Basic Law. One of these policies is that there shall be a Legislative Council. Article 68 of the Basic Law provides that the Legislative Council shall be constituted by election. It further provides for its development and formation in the following terms :

" The method for forming the Legislative Council shall be specified in the light of the actual situation in the Hong Kong Special Administrative Region and in accordance with the principle of gradual and orderly progress. The ultimate aim is the election of all the members of the Legislative Council by universal suffrage.

The specific method for forming the Legislative Council and its procedures for voting on bills and motions are prescribed in Annex II: 'Method for the Formation of the Legislative Council of the Hong Kong Special Administrative Region and Its Voting Procedures'."

71. This leads to Annex II which specifies amongst other things that the Legislative Council shall compose of 60 members in each term. The compositions of the Legislative Council in the second and third terms are set out. But this is not specified for the first term. It simply says that it shall be formed :

" ... in accordance with the 'Decision of the National People's Congress on the Method for the Formation of the First Government and the First Legislative Council of the Hong Kong Special Administrative Region'."

72. It is therefore clear that the method of formation of the Legislative Council in its first term was left to the decision of the NPC. Under Article 62(13) of the PRC Constitution, the NPC has the power to decide on the systems to be instituted in its special administrative regions. On 4th April 1990, the same day as the Basic Law was promulgated, the NPC made such a Decision. The relevant parts of this 1990 NPC Decision are paragraphs 1, 2 and 6. The effect of the Decision is this. The formation of the first Legislative Council must reflect the sovereignty of the State and must be conducive to a smooth transition. A Preparatory Committee is to be established in 1996. This Committee is entrusted with two tasks : first, it is responsible for matters relating to the preparation of the establishment of the HKSAR and second, it is to prescribe the specific method for the forming of the first Government and the first Legislative Council in accordance with the Decision of the NPC. The composition of the first Legislative Council is set out in paragraph 6 : 20 members to be returned by geographical constituencies through direct elections, 10 members by an election committee and 30 members by functional constituencies. There can be a "through train" for members of the last Hong Kong Legislative Council to become members of the first Legislative Council of the HKSAR provided they satisfy certain conditions : the composition of the last Hong Kong Legislative Council conforms with the Decision and the Basic Law; members uphold the Basic Law; members are willing to pledge allegiance to the HKSAR; members meet the requirements as specified in the Basic Law and the confirmation by the Preparatory Committee.

73. It is clear that at the time of the promulgation of the Basic Law in April 1990, it was intended that there would be a "through train" for members of the last Hong Kong Legislative Council. The purpose was to ensure continuity and to cause the least possible disruption as a result of the handover.

74. By 1994, as a result of the political reform proposals made by the last Governor, it was quite clear that the constitution and composition of the last Hong Kong Legislative Council would not be acceptable to the PRC. Consequently, the NPC Standing Committee made another Decision on 31st August 1994. Under that Decision, the Preparatory Committee for the HKSAR "shall be responsible for matters relating to the preparation of the establishment of the HKSAR, and to prescribe the specific method for the formation of the first Legislative Council of the HKSAR and organize the first Legislative Council of the HKSAR in accordance with the 1990 Decision of the NPC". This is not only a confirmation of the 1990 NPC Decision (paragraph 2 ). It also expressly authorizes the Preparatory Committee to organize the first Legislative Council. The question is : how did it set about doing it ?

75. There has been a lot of political debate on the reasons for the lack of a through train. Ms Li, SC, for the respondents did not concede that the last Legislative Council failed to conform with the 1990 NPC Decision (paragraph 6). I do not propose to make any adjudication on this either. It is not the business of the Court to enter into the political arena and to determine what the real reasons were. In any event, the British Parliament had enacted the Hong Kong Act in 1985 providing that as from 1st July 1997, the Queen shall no longer have sovereignty or jurisdiction over any part of Hong Kong. The result of this is that all the Royal Instructions and Letters Patent would expire on 30th June 1997. That being the case, the Hong Kong Legislative Council which was established thereunder would come to an end upon the cessation of British sovereignty over Hong Kong. Unless members of the last Legislative Council were acceptable by the PRC as the first Legislative Council of the HKSAR, they would simply cease to be Legislative Council members on 30th June 1997.

76. The result of this unfortunate situation was not only obvious but also potentially disastrous. There would be no Legislative Council on 1st July 1997 unless something is done before then.

Proposals

77. Mr Fung, SC, for the Government submits that there can only be two possible solutions : to hold an election before 1st July 1997 or to hold it after that date. He says that it is not viable in the absence of Sino-British co-operation to hold elections before 1st July 1997. This is clearly correct. Hong Kong was still under British rule. It would be unrealistic to hold an election for the first Legislative Council in accordance with the Basic Law and the 1990 NPC Decision. The second alternative clearly presents some great difficulties which are almost insurmountable. This would also take time. But the more important thing is that the HKSAR could not afford to have no legislature during the meantime. The Preparatory Committee which was entrusted to set up the first Legislative Council is clearly not a Hong Kong organisation, let alone a legislative body. It could not for example enact electoral laws to carry out an election as soon as possible. There would be no legislature to approve the funding of such election.

78. Ms Li, SC, submits that it is necessary to amend the Basic Law. However, this may not be possible under its own terms. For one thing, the Basic Law had not then become operative yet. Under Article 159, the power of amendment of the Basic Law is vested in the NPC but the power to propose amendments is vested in three bodies, namely, the NPC Standing Committee, the State Council and the HKSAR. The procedures to be followed to effect an amendment could not then be followed because there was no HKSAR, no Chief Executive and no Legislative Council member to submit a proposal from Hong Kong and for the same reason, there was no Committee for the Basic Law to study the proposal. The NPC could of course amend the Basic Law before it came into effect. But that would be impracticable and politically undesirable.

Role of the court

79. However, all these proposed solutions (and there may be others) are irrelevant for the present purpose. The Court is not concerned with whether there was any solution or which solution would be better to salvage the unfortunate situation. The Court is to decide whether the particular course of action taken by the Preparatory Committee has any legal basis.

80. The Preparatory Committee set up an interim body called the Provisional Legislative Council. This may not be politically wise. It may not be popular or acceptable to all. But the Court is not concerned with that. It is the task of the Court to examine whether the NPC had authorised the Preparatory Committee to establish this interim body, whether the Preparatory Committee had done so pursuant to its authority and powers and whether the Provisional Legislative Council is the interim body set up by the Preparatory Committee.

Legality

81. The NPC is the highest state organ of the PRC which is the Sovereign of the HKSAR. It had made its Decisions in 1990 and 1994 regarding the formation of the HKSAR. It is not disputed that the Preparatory Committee was authorized by the NPC to carry out the tasks which are set out in the 1990 and 1994 NPC Decisions. In my view, it is clearly within the authority and powers of the Preparatory Committee to do acts which are necessary and incidental to the preparation of the establishment of the HKSAR. When it has become clear that there would be no first Legislative Council, the Preparatory Committee decided on 24th March 1996 to set up the Provisional Legislative Council. This was done in December 1996. It is conceded by the Government that the Provisional Legislative Council is not the first Legislative Council of the HKSAR. Nor does it purport to be. It was only set up to do specific acts. The duties of the Provisional Legislative Council include:

(a) to enact laws which are essential for the normal operation of the HKSAR; and to amend and repeal laws where necessary in accordance with the Basic Law;

(b) to examine and approve budgets introduced by the Government;

(c) to approve levying of taxes at public expenditure;

(d) to receive and debate the policy address of the Chief Executive;

(e) to endorse the appointments of the Judges of the Court of Final Appeal and the Chief Judge of the High Court;

(f) the President of the Provisional Legislative Council of the HKSAR to take part in the nomination of six Hong Kong members to the Committee for the Basic Law of the HKSAR under the Standing Committee of the NPC;

(g) to deal with other matters that have to be dealt with by the Provisional Legislative Council of the HKSAR before the formation of the first Legislative Council of the HKSAR.

82. Further, it is also specified that the laws examined and passed by the Provisional Legislative Council before 1st July 1997 shall only come into force from the day the HKSAR is established. It shall operate until the first Legislative Council of the HKSAR is formed which shall not be later than 30 June 1998.

83. It is clear that the terms of reference of the Provisional Legislative Council as set out in the 1996 Decision of the Preparatory Committee are necessary and incidental to the initial operation of the first Government of the HKSAR. It was formed to assist the first Government in the absence of the first Legislative Council. Its formation is an interim measure out of necessity. This the Sovereign has undoubtedly the power to do. It was not intended as a breach of the Basic Law. It was done with the intention to implement the provisions of the Basic Law and the NPC Decisions.

84. Ms Li, SC, argues that the Provisional Legislative Council does not comply with Article 68 of the Basic Law. This may be so. In fact, at one stage, Mr Fung, SC, seems to concede that. But this is not the point. Although the Provisional Legislative Council has purported to act as a legislative body, it does so pursuant to the duties imposed on it by the 1996 Decision of the Preparatory Committee. It is, strictly speaking, not a Legislative Council under Article 68 of the Basic Law. It was not a creation of the Basic Law. It was not meant to be. It is only an interim body formed by the Preparation Committee under the authority and powers of the NPC pursuant to the 1990 and 1994 NPC Decisions. It was never intended to be a Legislative Council of the type and composition as specified in the Basic Law.

85. The positon is simply this. The NPC did by its 1990 Decision authorise the Preparatory Committee to prepare for the establishment of the HKSAR and specify the method of forming the first Government and first Legislative Council. It did by its 1994 Decision authorise the Preparatory Committee to organise the first Legislative Council. The Preparatory Committee established the Provisional Legislative Council as an interim body to enable the first Government to get going in the absence of the first Legislative Council and to set about forming the first Legislative Council. This is within the ambit of the authority and powers conferred on it under the 1990 and 1994 NPC Decisions.

86. For these reasons, I am inclined to hold that the Provisional Legislative Council was legally established by the NPC through the Preparatory Committee pursuant to the authority and powers conferred upon it. The NPC being the Sovereign of the HKSAR, the validity of the acts of establishing this interim body cannot be challenged in the HKSAR courts.

Ratification by NPC

87. The Government also relies on the ratification by the NPC made on 14th March 1997. It was a resolution of the Eighth NPC (not merely the Standing Committee) at its fifth session adopting the working report of the Preparatory Committee which set out the details of its Decision to establish the Provisional Legislative Council. By this adoption, Mr Fung, SC, argues, the NPC has expressly ratified the Preparatory Committee's Decision. It is a ratification by the Sovereign which has the effect of law. Hence, the legality of the Provisional Legislative Council cannot be doubted.

88. It is argued on behalf of the respondents that this Resolution is not sufficient for the purpose of endorsing or ratifying the Preparatory Committee's decision to set up the Provisional Legislative Council.

89. The Resolution states that the NPC had examined the working report of the Preparatory Committee and "hereby approves" it. The Chinese text uses words "批准 pi zhun" which mean that the NPC "permits or allows" the report. This must refer to the acts or actions taken by the Preparatory Committee. However, it is not necessary to rely on the Chinese text because, in my view, the English version of the Resolution to which the report is annexed is quite clear.

90. The Resolution recites the fact that the Preparatory Committee has adopted in accordance with the Basic Law and other principles a series of decisions, resolutions and proposals including the Decision on the establishment of the Provisional Legislative Council of the HKSAR. It recognizes the election presided by the Preparatory Committee by which the Selection Committee had elected the members of the Provisional Legislative Council. It acknowledges that all these had laid down a foundation for the establishment of the HKSAR and a smooth transition of Hong Kong.

91. Annexed to the Resolution was the working report of the Preparatory Committee. The report states amongst other things the following:

" Some doubts have been raised in Hong Kong's public opinion about the power of the Preparatory Committee in making decision on the formation of the Provisional Legislative Council. In fact, Article 2 of the above mentioned Decision of the NPC provides that the Preparatory Committee 'shall be responsible for matters relating to the preparation for the establishment of the HKSAR'. The formation of the Provisional Legislative Council falls within this ambit. It is a power organ established by the NPC. The Preparatory Committee has been authorized to make decisions on matters relating to the establishment of the HKSAR. This authorization covers the power to form the Provisional Legislative Council.

In the light of the actual situation that the legislature must be in place upon the establishment of the HKSAR and in accordance with the above mentioned Decision of the NPC, the plenary session of the Preparatory Committee in March 1996 adopted the Decision to form the Provisional Legislative Council of the HKSAR. In October, it adopted the method on the formation of the Provisional Legislative Council of the HKSAR. The method provides that the Provisional Legislative Council of the HKSAR shall be elected by select ballot by the Selection Committee for the first Government of the HKSAR. The Provisional Legislative Council shall be formed and start working after the appointment of the first Chief Executive of the HKSAR. Its main tasks include enactment of laws which are indispensable to the normal operation of the HKSAR and participation in necessary personnel arrangements. It shall function until the first Legislative Council of the HKSAR is formed but not later than 30th June 1998. The Decision of the Preparatory Committee on the establishment of the Provisional Legislative Council of the HKSAR and the above mentioned method are in compliance with the Decision of the NPC on the method for the formation of the first Government and on the first Legislative Council of HKSAR adopted by the Seventh National People's Congress at its third session on 4th April 1990."

92. The report not only recognizes the authority and powers of the Preparatory Committee, it also states clearly that the Provisional Legislative Council was in fact formed pursuant to the exercise of such authorization and powers. It regards the formation of the Provisional Legislative Council as necessary and sets out the main tasks of this interim body and its term of office.

93. In my view, the Ratification is sufficiently clear. It adopts the course of action taken by the Preparation Committee as set out quite fully in its working report. It is clear that the NPC as the highest state organ of the Sovereign of the HKSAR has adopted the setting up of the Provisional Legislative Council and its work before the establishment and formation of the first Legislative Council. The Ratification is a sovereign act which the HKSAR courts cannot challenge.

94. In view of the conclusions I have reached, it is not necessary to deal with the doctrine of necessity and I do not propose to do so.

Conclusion

95. For the reasons which I have set out above, I have come to the conclusion that upon a true construction and interpretation of the relevant provisions of the Basic Law, the laws previously in force in Hong Kong including the common law have been adopted and become the laws of HKSAR on 1st July 1997, the judicial system together with the principles applicable to court proceedings have continued, and indictments and pending criminal proceedings have continued to be valid.

96. The answers to the questions reserved for this Court are that the common law has survived the change of sovereignty and the three respondents are liable to answer to and be tried under the Amended Indictment.

97. If I am wrong on the interpretation of the relevant provisions of the Basic Law, I am of the view that the provisions of the Reunification Ordinance has made it amply clear that the common law survives, the indictment is still valid and the pending criminal proceedings continue. It is an ordinance which was lawfully and validly passed by the Provisional Legislative Council which was legally established by the Preparatory Committee which is an NPC body and exercises the authority and powers conferred on it by the 1990 and 1994 NPC Decisions. Its establishment was ratified by the NPC on 14th March 1997.

Nazareth, V.-P.:

Introduction

98. I gratefully adopt the comprehensive statement of the background given in the judgment of my Lord, the Chief Judge.

99. Upon the two questions of law referred, two principal points arise for decision:

(1) Has the common law survived the resumption of sovereignty by the PRC?

(2) Are the defendants liable to answer to and be tried on indictment No. 1/97?

Whether the common law has survived in HKSAR?

100. The defendants' submissions were put to us in the skeleton argument of Mr Chandler, who appeared for the 2nd defendant, which was adopted by Mr Egan for the 1st defendant. In substance, the submissions focused and relied primarily upon the words "... shall be adopted as the laws of the Region" in Article 160 of the Basic Law, contending that some additional act extrinsic to the Basic Law was required before the laws previously in force could become the laws of HKSAR on 1st July 1997.

101. It is not in dispute that the primary source of the law of the Hong Kong Special Administrative Region of the People's Republic of China ("HKSAR") is the Basic Law enacted by the National Congress of the People's Republic of China ("NPC"). The defendants' point to Articles 8, 18, 19, 87 and 160 of the Basic Law. The latter reads as follows:

"Article 160

Upon the establishment of the Hong Kong Special Administrative Region, the laws previously in force in Hong Kong shall be adopted as laws of the Region except for those which the Standing Committee of the National People's Congress declares to be in contravention of this Law. If any laws are later discovered to be in contravention of this Law, they shall be amended or cease to have force in accordance with the procedure as prescribed by this Law.

Documents, certificates, contracts, and rights and obligations valid under the laws previously in force in Hong Kong shall continue to be valid and be recognised and protected by the Hong Kong Special Administrative Region, provided that they do not contravene this Law." (emphasis supplied)

102. It was argued that significant support for that contention could be derived from the Decision of the Standing Committee of the NPC of 23rd February 1997. Paragraph 1 of that Decision is in the following terms:

"The laws previously in force in Hong Kong which include the common law, rules of equity, ordinances, subordinate legislation and customary law, except for those which contravene the Basic Law, are adopted as the laws of the HKSAR."

103. Paragraphs 2 and 3 state that Ordinances and subordinate legislation previously in force and set out respectively in Annexes I and II to the Decision are not adopted as the laws of Hong Kong.

104. Paragraph 4 states:

"such of the laws previously in force in Hong Kong which have been adopted as the laws of the HKSAR shall, as from 1 July 1997, be applied subject to such modifications, adaptations, limitations ...".

If, the argument runs, the Standing Committee of the NPC which exercises many of the legislative powers of the NPC under the constitution of the PRC has seen fit albeit in February 1997 to adopt laws previously in force in Hong Kong, then that must be a strong indication of the intention of Article 160 of the Basic Law. However, as will be seen, it is very clear from Articles 8, 18 and 84, that the laws previously in force are by virtue of Article 8 of itself and without any extrinsic act maintained as the laws of HKSAR subject to the reservations in Article 160. Moreover, it has been said the reiteration of the provisions of earlier laws is not unusual in Chinese practice (per Professor Yash Ghai (1997) HKLJ Vol 27 Part 2, 141). In the foregoing light, the decision can be seen to be directed to specifying those laws previously in force in Hong Kong that are not adopted as the laws of the HKSAR.

105. Similarly, the defendants seek to rely also upon the following paragraph in the preamble to the Hong Kong Reunification Ordinance 1997:

"The National People's Congress, in exercising its powers under Article 160 of the Basic Law on 23 February 1997, resolved which of the laws previously in force in Hong Kong are to be adopted as the valid laws of the Hong Kong Special Administrative Region and the principles on which those laws should be construed and adapted."

They seek also to rely upon a definition of "laws previously in force" inserted into the Interpretation and General Clauses Ordinance by the Hong Kong Reunification Ordinance as meaning the common law etc. in force in Hong Kong immediately before 1 July 1997 and adopted as the laws of the Hong Kong Special Administrative Region. Such reliance suffers from the deficiency identified in relation to the Decision of the Standing Committee of the NPC on 23rd February 1997. Moreover, the Provisional Legislative Council ("PLC") was created by the Preparatory Committee, itself a committee appointed by the NPC. It was appointed some six years and enacted the Reunification Ordinance some seven years after the enactment of the Basic Law. In these circumstances the views (if such they be) expressed in subordinate legislation made some seven years after the enactment of the primary legislation must be of insignificant assistance in construing provisions of the primary legislation.

106. Returning then to the words of Article 160, although Mr Chandler's skeleton focuses only upon "shall be adopted", it is their association with the earlier words "Upon establishment of the Hong Kong Special Administrative Region" that at first blush suggests a temporal qualification. Upon those words themselves, it could at least be said that as to whether or not an extrinsic act of adoption was required, Article 160 is ambiguous. Even that may be putting it too high. From Article 160 itself, it can be seen that the construction that an extrinsic act is necessary tends to produce anomalous results. Under the last paragraph of Article 160 (itself without any suggestion of anything more being required) rights and obligations under laws previously in force are continued. However that may be, any ambiguity would have to be resolved by reference to the Basic Law as a whole, and beyond that, to its genesis and even to the constitution of the PRC.

107. Articles 8, 18 and 87 of the Basic Law are as follows:

"Article 8

The laws previously in force in Hong Kong, that is, the common law, rules of equity, ordinances, subordinate legislation and customary law shall be maintained, except for any that contravene this Law, and subject to any amendment by the legislature of the Hong Kong Special Administrative Region.

Article 18

The laws in force in the Hong Kong Special Administrative Region shall be this Law, the laws previously in force in Hong Kong as provided for in Article 8 of this Law, and the laws enacted by the legislature of the Region.

Article 87

In criminal or civil proceedings in the Hong Kong Special Administrative Region, the principles previously applied in Hong Kong and the rights previously enjoyed by parties to proceedings shall be maintained.

..."

Articles 19 and 87 may also be said to be relevant.

108. Plainly, the effect of Article 8 is that the common law continues and that it does so under Article 8 (rather than under Article 160) follows from Article 18. In that light, it can be seen that the real purpose and the effect of Article 160 is to provide for the non-adoption of such of the laws previously in force as the Standing Committee of the NPC declares to be in contravention of the Basic Law.

109. If Article 160 is to be reconciled with Articles 8, 18 and 84, then upon a common law approach, it would clearly be directory rather than mandatory, thus posing no threat to the survival in the HKSAR of the common law, not to mention the other vital components of Hong Kong law which together are provided for in these articles.

110. The defendants' contention that an intrinsic act of adoption was necessary to continue the common law must therefore be rejected. That conclusion becomes even clearer in the light of the overwhelming theme of a seamless transition in the Joint Declaration and the Basic Law.

The Chinese text of Article 160

111. For the HKSAR the Solicitor General relied also upon the Chinese text of the Basic Law, which under the NPC's Decision of 28th June 1990 prevails over the English text. His submissions are on their face plausible, and have not been controverted on behalf of the defendants. It must therefore be accepted that the Chinese text of Article 160 makes it clear that an act of adoption is not necessary. If the English text were ambiguous, this would produce the conclusion mentioned.

Whether the common law offence of conspiracy to pervert the course of justice is part of the law of Hong Kong

112. There remains to be considered the defendants' ancillary ground that the offence at common law of conspiracy to pervert the course of justice is not part of the law of the HKSAR. The nature of this ground is clearly explained in the judgment of my Lord Mortimer V-P, which I have had the advantage of seeing in draft. I agree with his reasons and conclusion. I would add that 1st July 1997 as the 'cut-off' date is also clear from the implications of the last paragraph of Article 160. It could not have been the intention in 1990 or in 1984, to continue contracts and obligations subsisting in those years with effect from 1st July 1997; it would have been foreseen that a goodly number of these would have long expired before then.

113. I would, therefore, answer the first question reserved to this Court in the affirmative.

Whether the indictment lapsed on 1st July 1997?

114. The defendants' challenge to the survival of the indictment was mounted upon the following basis:

(1) that the proceedings commenced and the indictment was filed in the former High Court while the British exercised sovereignty in Hong Kong;

(2) that the former High Court ceased to exist at midnight on 30th June 1997; and

(3) that the defendants are to be tried before the HKSAR Court of First Instance which was established by s.8 of the Reunification Ordinance 1997, which Ordinance is devoid of effect as being the enactment of a legally non-competent body.

115. The HKSAR's primary response is that the Reunification Ordinance does not enter into it at all; and that Article 160 provides a sufficient answer. It is, of course, the last paragraph of Article 160 that is relied upon.

116. It is specifically "rights and obligations" that are relied upon. In substance, it is contended that:

(i) the institution of the indictment vested a right in the prosecuting authorities to have it heard and determined in the courts;

(ii) there is a concurrent obligation imposed on the accused to be tried on that indictment, and an obligation to answer to it under s.49 of the Criminal Procedure Ordinance; and

(iii) there is a clear indication in Article 160 of the Basic Law that rights and obligations as before are to continue.

117. Given the predominant theme of a seamless transition and the purposive approach appropriate to constitutions that is called for (and not only upon that account as will be seen), it seems to me right that the last paragraph of Article 160 should be construed in the manner contended for by the Solicitor General.

118. That still leaves the question of the creation of the new court to be addressed. For the purpose, Article 81 is invoked. Its first paragraph reads:

"The Court of Final Appeal, the High Court, district courts, magistrates' courts and other special courts shall be established in the Hong Kong Special Administrative Region. The High Court shall comprise the Court of Appeal and Court of First Instance." (emphasis supplied)

119. For reasons similar to those that led me to the conclusion that the words "shall be adopted" in Article 160 do not require an additional act of adoption, it seems to me that the words "shall be established" likewise here do not require any additional act of establishment to legally create the courts mentioned; they stand established by the imperative words of the Basic Law upon the coming into force of that Law.

120. Likewise, it seems to me, that rules, procedures and the like would for the purpose be sufficiently provided for by the second paragraph of Article 81:

"The judicial system previously practised in Hong Kong shall be maintained except for those changes consequent upon the establishment of the Court of Final Appeal of the Hong Kong Special Administrative Region."

121. The first paragraph of Article 87 is also in point:

"In criminal or civil proceedings in the Hong Kong Special Administrative Region, the principles previously applied in Hong Kong and the rights previously enjoyed by parties to proceedings shall be maintained."

For the foregoing reasons, I am satisfied that the indictment did not lapse and that the defendants' challenge to it fails. The second question referred accordingly also falls to be answered in the affirmative.

122. It is accordingly not necessary to address the HKSAR alternative ground, which is reliance upon the Reunification Ordinance. This contains very detailed and full provision for the continuity of legal proceedings. Understandably, no question has been raised as to the adequacy of those provisions and I can see no reason to suppose that they would not meet all the defendants' points, save the validity of the Ordinance itself. The latter is questioned, as I have said, on the basis of the legal competence of the PLC, the body that enacted it.

123. It is in this somewhat incidental way that this question of plainly momentous importance to Hong Kong comes to be raised. As I have said, in the light of the conclusions I have already reached, which suffice to dispose of the reference to this Court, it is now not necessary to address that question. In ordinary circumstances I would not have contemplated doing so. But this is no ordinary case. The question having been raised and full submissions received from distinguished senior counsel, it seems to me that it would not be in the public interest to decline to deal with it, for that would be at the same time suppress a potential opportunity for the question to be expeditiously resolved by the Court of Final Appeal and the Standing Committee of the NPC, if it comes to that. That we should deal with the matter was also the unanimous view of counsel, although Ms Li did say that the present circumstances perhaps do not appropriately present all the aspects that have to be examined to resolve the question.

Jurisdiction of HKSAR courts

124. In his submissions on the HKSAR's primary ground that the HKSAR courts have no jurisdiction to question the legality of the PLC, the Solicitor General began by assimilating the exercise of powers by the NPC (as the supreme organ of the state exercising both legislative and decision-making powers under the PRC constitution) to the exercise of powers previously by the sovereign and the scope for challenge in the previous Hong Kong courts. HKSAR courts, he submitted, had no more jurisdiction to entertain a challenge the legality of a legislature established by the sovereign via the NPC, than the previous Hong Kong courts would have had in respect of a legislature established via an Act of the British Parliament or an amendment of the Letters Patent.

125. I pause here to note that no instance has been traced by counsel before us of such a challenge in any British colony. Nor for that matter has any direct authority been produced for the proposition that no such challenge may be entertained.

126. Reverting then to the Solicitor General's submissions, the second paragraph of Article 19 of the Basic Law provides that:

"The courts of the Hong Kong Special Administrative Region shall have jurisdiction over all cases in the Region, except that the restrictions on their jurisdiction imposed by the legal system and principles previously in force in Hong Kong shall be maintained."

This, it is submitted, defines the jurisdiction of the HKSAR courts, and reflects the previous jurisdiction, conferring no greater power.

127. The establishment of the PLC, it is said, is a matter purely of Chinese national law.

128. The HKSAR is established under the Basic Law with its national law that of the PRC; and the Basic Law is enacted under Article 31 of the PRC constitution. Both these propositions are obviously right and are not disputed.

129. No amendment, the submission went on, is necessary to implement the PLC. The method of formation of the legislature was specified in Annex II in the Basic Law; otherwise it was left to the PRC to establish the first government and legislature. This contention, it should be mentioned, was vigorously contested by Ms Li; but it falls to be addressed rather more directly in the context of the next major issue.

130. Ms Li also strongly opposed the Solicitor General's other submissions. She pointed out that the Basic Law is an interface, in the one country, between the two systems, which results in exceedingly complex questions. The PRC constitution contains some provisions which cannot apply to the HKSAR. The Basic Law, she observes, was passed under Article 31. Is the court, therefore, restricted to Article 31 and precluded from looking further? The answer, Ms Li submitted, must lie in the Basic Law. Specifically, with respect to the HKSAR's submission on the jurisdiction of the HKSAR courts, she pointed out that the basis upon which it proceeds is that there is no distinction between NPC laws and Acts of Parliament (and prerogative orders in council, one may add). She pointed to the judgment of this Court in Lee Miu-ling and anor v Attorney General [1996] 1 HKC 124, which recognised that the Hong Kong courts could examine the compliance of Hong Kong Ordinances with the Letters Patent.

131. The Solicitor General made it clear that

(a) the HKSAR submission did not for one moment question the competence of Hong Kong courts before 1st July 1997 to determine questions of conformity of Hong Kong statutory law with the Letters Patent; and

(b) similarly, that the HKSAR courts, after 30th June 1997, are clearly empowered to determine questions of constitutionality of SAR made legislation vis-a-vis the Basic Law; see, he says, e.g. Article 158 of the Basic Law.

I pause here to note that what on the face of Article 158 appears to be a bare power to interpret the Basic Law, does not seem to import also power to determine the constitutionality of SAR made laws vis-a-vis the Basic Law, which seems however to flow from the second paragraph of Article 19.

132. The Solicitor General contended that Lee Miu-ling validates the HKSAR's submission in that it is authority that the Hong Kong courts could determine questions of conformity of Hong Kong statutes with the Letters Patent, but not authority that the appointment of the legislature could be questioned. That does seem to be so. But it leaves unclear the basis upon which such conformity may be questioned given that both the creation of the courts (though perhaps not all their jurisdiction), and of the legislature were acts of the sovereign. In the absence of any authoritative indication of what is the basis of such accepted jurisdiction, it is difficult to see how such limited jurisdiction to question the conformity of legislation can found a challenge to the appointment of the legislature itself, clearly an act of the sovereign in that previous context. Turning to the post 30th June 1997 situation, to the extent that the restrictions on their jurisdiction imposed by the legal system and principles previously in Hong Kong" maintained under the second paragraph of Article 19 of the Basic Law applies, the courts of the HKSAR courts would have the same jurisdiction, i.e. to question conformity of legislation but not the appointment of the legislature. That, it seems to me, must clearly depend upon whether or not the legislature was created by the sovereign, as previously.

133. Proceeding to the Solicitor General's refinements in reply, he referred to the position of the Hong Kong courts before 1st July 1997 which could not determine the constitutionality of either UK Metropolitan or Imperial legislation vis-a-vis either the unwritten British constitution or the Hong Kong's Letters Patent. Neither, he said, could the Hong Kong courts judicially review metropolitan executive acts upon the following bases:

(a) The doctrine of parliamentary sovereignty.

(b) The principle of constitutional hierarchy whereby Acts of Parliament and ministerial decisions were not subject to the Hong Kong Letters Patent.

(c) The different legal systems under which Parliamentary Acts are enacted and ministerial decisions in the metropolis are made, from that under which the colonial courts operated. English law, though similar, was certainly not the same as Hong Kong law; the British legal system a fortiori was not the Hong Kong legal system.

(d) No remedy could properly issue since neither Acts of Parliament or ministerial decisions are subject to Hong Kong jurisdiction.

134. On the material before this Court, subject to the reservations I have to voice, it seems to me, that those four matters have to be accepted, and likewise the conclusions contended for that the Hong Kong courts could not have entertained any challenge to the Hong Kong Act 1985 or any of the orders in council made thereunder; and that e.g. Hong Kong courts could not have determined the constitutionality of a decision of the Secretary of State applicable to Hong Kong.

135. In the light of the foregoing, if the Preparatory Committee is a working committee under the NPC and thereby a creature of the sovereign, this Court could not review its constitutionality or the legality of its actions. As to that, given Article 2 of the NPC Decision of 4th April 1990, it is difficult to avoid the conclusion that the Preparatory Committee is a creature of the sovereign, i.e. the NPC. It must follow, in the absence of any other law or principle none having been brought to notice, that this Court cannot inquire into the constitutionality of the PLC.

136. I would add that I neither need to rely upon nor am I attracted by the additional HKSAR ground that the confirmation of the HKSAR judiciary by the PLC must by the absurdity that would be precipitated by the judiciary thereafter ruling the PLC illegal, precludes or limits the HKSAR courts capability of determining the act of the Preparatory Committee creating the PLC to be illegal or unconstitutional.

137. Although I am driven to the conclusion I have expressed, I cannot say I have come to accept it without hesitation. Ms Li pointed to a number of matters that could impinge upon it. The analogy between NPC and the British "sovereign" upon further examination may not hold in material respects. There is a written constitution in China, and presumably nothing that corresponds to the Royal Prerogative. Nor has there been a detailed review of the provisions of the PRC constitution according to Ms Li, which it was hinted might bear upon the matter. While, therefore, I find myself unable to resist the conclusion expressed upon the actual submissions made to the Court, I find it necessary to say that even though the foregoing be obiter, it should not be regarded as a concluded view.

138. That view, however, obviates the necessity to address also the question of the legality of the PLC, but for the reasons already given, I now turn to that matter.

Legality of the Provisional Legislative Council

139. Ms Li, with Miss Margaret Ng and Mr Paul Harris, presented this aspect of the defendants' case. Her submission was quite simple. The PLC contravenes the Basic Law and the Decision made by the NPC on the same day, in material respects. She was easily able to demonstrate non-conformity by reference to individual provisions in the Basic Law and the Decision. Indeed, the Basic Law does not even mention a Provisional Legislative Council. Therefore, she submitted, the PLC has not been validly constituted. I do not propose here to adumbrate her elaboration of that submission, which I address in this judgment as it arises. The individual provisions that Ms Li said are contravened as follows:

"Article 68

The Legislative Council of the Hong Kong Special Administrative Region shall be constituted by election.

The method for forming the Legislative Council shall be specified in the light of the actual situation in Hong Kong Special Administrative Region and in accordance with the principle of gradual and orderly progress. The ultimate aim is the election of all the members of the Legislative Council by universal suffrage.

The specific method for forming the Legislative Council and its procedures for voting on bills and motions are prescribed in Annex II: 'Method for the Formation of the Legislative Council of the Hong Kong Special Administrative Region and Its Voting Procedures'.

Article 69

The term of office of the Legislative Council of the Hong Kong Special Administrative Region shall be four years, except the first term which shall be two years."

Annex II, as to such part of it as is relevant, is as follows:

"I. Method for the Formation of the Legislative Council:

1. The Legislative Council of the Hong Kong Special Administrative Region shall be composed of 60 members in each term. In the first term, the Legislative Council shall be formed in accordance with the 'Decision of the National People's Congress on the Method for the Formation of the First Government and the First Legislative Council of the Hong Kong Special Administrative Region'. The composition of the Legislative Council in the second and third terms shall be as follows:

...

2. Except in the case of the first Legislative Council, ..."

140. The Decision of the National People's Congress on the method for the formation for the first government and first Legislative Council of the Hong Kong Special Administrative Region was made, clearly by adoption of resolution, on 4th April 1990, i.e. the same day as the Basic Law was passed. The following of its provisions are relevant:

"1. The first Government and the first Legislative Council of the Hong Kong Special Administrative Region shall be formed in accordance with the principles of state sovereignty and smooth transition.

2. Within the year 1996, the National People's Congress shall establish a Preparatory Committee for the Hong Kong Special Administrative Region, which shall be responsible for matters relating to the preparation of the establishment of the Region and shall prescribe the specific method for forming the first Government and the first Legislative Council in accordance with this Decision. ...

3. ...

4. ...

5. ...

6. The first Legislative Council of the Hong Kong Special Administrative Region shall be composed of 60 members, with 20 members returned by geographical constituencies through direct elections, 10 members returned by an election Committee, and 30 members returned by functional constituencies. If the composition of the last Hong Kong Legislative Council is in conformity with the relevant provisions of this Decision and the Basic Law of the Hong Kong Special Administrative Region, those of its members who uphold the Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China and are willing to pledge allegiance to the Hong Kong Special Administrative Region of the People's Republic of China, and who meet the requirements set forth in the Basic Law of the Region may, upon confirmation of the Preparatory Committee for the Hong Kong Special Administrative Region, become members of the first Legislative Council of the Region.

The term of office of members of the first Legislative Council of the Hong Kong Special Administrative Region shall be two years."

141. It is helpful in addressing that submission to know the broad nature of the Solicitor General's response. This is that the PLC was in any event validly established under the Basic Law. Little time need be spent upon the several and significant respects in which the PLC does not conform with the Basic Law, and relevant decisions of the NPC or NPCSC, which Ms Li clearly demonstrated. The Solicitor General readily conceded that the Basic Law does not even mention the PLC. More importantly he clarified that the HKSAR case was not that the PLC was the first Legislative Council of the HKSAR, but a provisional legislative body set up by the Preparatory Committee to get what was to be a through train back on track after it had been derailed by the last governor's political reforms. Whatever view one might take of the latter, and whether or not those reforms had been made, the fact was that the 1995 Legislative Council would have lapsed at midnight on 30th June 1997. That was the inevitable result of the end of British sovereignty and the resumption of the exercise of Chinese sovereignty. It was also fully reflected in the Hong Kong Act 1985 of the United Kingdom Parliament.

142. It was for the PRC to fill the legal vacuum that would ensue. That is not in dispute. On the same day that the NPC enacted the Basic Law, it also passed the Decision providing for establishment of a preparatory committee for the Hong Kong Special Administrative Region in the year 1996, to be responsible for prescribing the specific method for forming the first Legislative Council.

143. In 1996 the situation was that those provisions were not going to prevent a legal vacuum. Compliance with them required the cooperation of the British. It is not suggested that this would be forthcoming. So elections could not be held before 1st July 1997. There was also no suggestion before us that the elections could be held after that date without an unacceptable legislative vacuum.

144. By Article 2 of the NPC declaration of 4th April 1990, the Preparatory Committee was responsible for matters relating to the establishment of the SAR including inter alia the first Legislative Council in accordance with the Decision. Article 6 specified the detailed composition of the first Legislative Council. This could not be complied with as indicated. Elections could not be held before 1st July 1997; they also could not be held early enough after that day. Some interim arrangements therefore had to be made. It being impossible to form the first Legislative Council under Article 6, the Preparatory Committee decided to form a provisional legislative council under Article 2 to prevent a legal vacuum while the first Legislative Council was being constituted under Article 6.

145. Although expressed as Decisions of the NPC the Decisions of 4th April 1990 and 8th August 1994 must be regarded as legislation or enactments, given their content and effect. The responsibility placed upon the Preparatory Committee for "matters relating to the preparation of the establishment of the Region" and the direction that it "organise the First Legislative Council" in the two Decisions, must carry with them all such powers as are reasonably necessary to enable the Preparatory Committee to carry out those duties.

146. If this produced a result that did not accord with the Basic Law, that does not mean the Basic Law itself had to be amended. Reference was made to the PRC constitution, but no such requirement was shown. The detailed provisions for the formation of the first Legislative Council were hived off by the NPC in the contemporaneously made Decision of the 4th April 1990. If any inconsistency arises between the Basic Law and the Decisions in relation to the formation of the first Legislative Council, clearly the latter as the more specific (and later in respect of the 8th August 1994 Decision) must prevail.

147. The question, therefore, is this: "Was the creation of the PLC sanctioned by the two NPC Decisions?" The question is not whether the PLC conformed to Article 6 of the former, for if the PLC was validly appointed under Article 2 of the 4th April 1990 Decision, or under the 1994 Decision, non-conformity with Article 6 would be irrelevant.

148. For Hong Kong common law courts, that is not an easy question. It is one that involves interpretation of Chinese law to produce a construction that properly viewed must be made in accordance with Chinese law. However that may be, I cannot see that the Preparatory Committee's establishment of the PLC as other than in accordance with the NPC Decisions, even if the matter is approached upon common law canons of construction. The theme running through the Joint Declaration, the Basic Law enacted to implement the basic policies of the People's Republic of China that the Joint Declaration embodies, and the associated Decisions of the NPC and the Standing Committee of the NPC, was of a smooth transition. A purposive construction is one of the well recognised methods of common law construction, and is clearly called for by the broad policy and principles in terms of which the PRC instruments are formulated and drafted and their constitutional nature.

149. The inability of the Preparatory Committee to comply with Article 6 of the 4th April Decision did not absolve it from its duty to organise the first Legislative Council. In those circumstances it decided that the appropriate action to take, was to bring the derailed legislative train back on track. This could not be done immediately, for elections take time. If decided that in the interim a provisional body should be constituted to attend to the functions of the Legislative Council that necessarily had to be performed. Not everyone might agree that was the most efficient way of proceeding. But it was done to meet the situation and the object was not to create a provisional legislature but a provisional body with a limited life that had to have legislative powers in order to fill the vacuum while the bringing of the first Legislative Council into being was organised. What was appointed was not the first Legislative Council; it was a body known as the Provisional Legislative Council to act in the interim. What was done was reasonably necessary and within the scope of the duty and concomitant power under the two NPC Decisions. Even upon the common law approach of judicial review that approach could not be faulted as being irrational; plainly it is not.

150. However, it is said the result of that was to effect a breach of the Basic Law in particular of Article 68, which says that the Legislative Council of the HKSAR shall be constituted by election, and that no amendment was made to the Basic Law. But it is plain from the Basic Law that the special provisions already mentioned were made in respect of the first term and the first Legislative Council. The NPC was entitled to place them in the 4th April Decision. Article 68 not only said that the Legislative Council of the HKSAR shall be constituted by election, it went on to say that:

"The method for forming the Legislative Council shall be specified in the light of the actual situation in Hong Kong Special Administrative Region and in accordance with the principle of gradual and orderly progress. The ultimate aim is the election of all the members of the Legislative Council by universal suffrage."

151. For those reasons, in my view, the appointment of the PLC must be regarded as valid under Chinese law and the defendants' challenge to the legality of the PLC rejected.

NPC ratification of the Preparatory Committee's decision to set up the PLC

152. Yet another ground relied upon by the HKSAR is that the Preparatory Committee's decision to set up the PLC was ratified by the NPC.

153. On 14th March 1997, the NPC passed a resolution on the working report of the Preparatory Committee. The English translation furnished to us includes the following sentence:

"The Session hereby approves the Report."

Then, after referring to what the Preparatory Committee had done, the resolution adds this:

"All these laid down a foundation for the establishment of the HKSAR and the smooth transition of Hong Kong and have facilitated the long-term stability and prosperity of Hong Kong."

In general, it is fair to say that the resolution recognised and approved the work done by the Preparatory Committee.

154. It is this resolution then that the HKSAR submission contends, constitutes ratification of the Preparatory Committee's establishment of the PLC. It has to be said that it would be regarded as deficient if judged purely upon common law norms. But we are here not dealing with a common law legislature or even a common law jurisdiction; nor in my view could it be right to approach the matter with traditional common law methods and precedents of legislative ratification in mind.

155. The Preparatory Committee report was annexed to the resolution. It contained the following paragraph:

"Some doubts have been raised in Hong Kong's public opinion about the power of the Preparatory Committee in making decision on the formation of the Provisional Legislative Council. In fact, Article 2 of the above-mentioned Decision of the NPC provides that the Preparatory Committee 'shall be responsible for matters relating to the preparation for the establishment of the HKSAR'. The formation of the Provisional Legislative Council falls within this ambit. As a power organ established by the NPC, the Preparatory Committee has been authorized to make decisions on matters relating to the establishment of the HKSAR. This authorization covers the power to form the Provisional Legislative Council."

156. In its resolution the NPC praised the work of the Provisional Committee. In approving the report, the NPC must have approved the action it took. But whether that amounted to ratification, I have found myself ill-equipped to judge. For instance, is a resolution of that sort an accepted form of legislative ratification? Perhaps we should have been assisted by expert evidence. For the reasons that my Lords give, they are satisfied that the resolution constitutes ratification. Having regard to those reasons, I am persuaded that I should not press my reservations to the point of expressing a dissenting view.

The doctrine of necessity

157. Finally, the last of the HKSAR's layered grounds is referred to as the doctrine of necessity. I do not find it necessary to rely upon it and express no view upon its application to the appointment of the PLC.

Conclusion

158. To sum up my conclusions, I would answer the two questions in the affirmative.

159. Upon the submissions made to this Court, in my view:

(i) This Court has no jurisdiction to entertain challenges to the legality of the Provisional Legislative Council, that being a body established by the sovereign.

(ii) The Provisional Legislative Council was validly appointed under the NPC Decisions of 4th April 1990 and 8th August 1994, which have effect as laws in China.

(iii) The appointment of the provisional legislature was ratified by the NPC Resolution of 14th March 1997.

160. I express no view upon the doctrine of necessity and its application to the appointment of the Provisional Legislative Council.

Mortimer, V.-P. :

161. I also would answer the two questions referred to this Court in the affirmative.

Representation by counsel

162. Before I turn to the issues, I also would like to mention the difficulties which arose over the representation of the defendants. The Director of Legal Aid declined the Court's invitation to brief leading counsel for the 3rd defendant and consequently on this reference, he appears in person but with Mr Halley holding a watching brief. The other two defendants declined to brief counsel for this hearing, but Mr Egan for the first and Mr Chandler for the second accepted our invitation to remain to present their submissions for our assistance. A helpful skeleton had been provided by Mr Chandler and that was also relied upon by Mr Egan.

163. After the short adjournment on the first day, Ms Gladys Li, SC, (Miss Margaret Ng and Mr Paul Harris with her) appeared to offer her services to the Court - it would seem as amicus. For my part, there were serious problems about her locus standi. For obvious reasons it would be difficult for the Court to accept as its amicus counsel who appears without invitation. Fortunately, however, the 1st defendant invited Ms Li to lead Mr Egan to advance submissions limited to the legality of the Provisional Legislative Council (PLC). This she did. Her closely reasoned and attractively presented submissions, I find both helpful and enlightening.

The reference

164. On 7th July 1997 the three defendants were arraigned before Deputy Judge Lugar-Mawson in the Court of First Instance on count 1 of Indictment No. 1 of 1997. They pleaded not guilty to an offence of conspiracy to pervert the course of justice contrary to common law.

165. Counsel for the defendants moved to quash count 1 of the Indictment on grounds set out in their motion to quash which have now been argued before us.

166. Counsel for the Government moved by notice of motion that the issues of law arising should be reserved by the Deputy Judge to this Court under s.81 of the Criminal Procedure Ordinance, Cap. 221. Counsel for the defendants did not oppose. By an amended order, the judge reserved two questions for our determination:

(1) Is the offence at common law of conspiracy to pervert the course of public justice part of the laws of the HKSAR?

(2) Are the accused liable to answer to and to be tried on count 1 of Indictment No. 1 of 1997?

The legislative history

167. It is useful to briefly set out the legislative history of the establishment of the Hong Kong Special Administrative Region (HKSAR).

168. On 19th December 1994, by the Joint Declaration, the United Kingdom agreed to restore Hong Kong to the People's Republic of China and the Government of the People's Republic of China decided to resume sovereignty over Hong Kong with effect from 1st July 1997.

169. By Annex I, the Government of the PRC elaborated its basic policies regarding Hong Kong. By clause 3, it was agreed that

"The Hong Kong Special Administrative Region will be vested with executive, legislative and independent judicial power, including that of final adjudication. The laws currently in force in Hong Kong will remain basically unchanged".

170. Under s.2 of that annexure, it was stated

"... the laws previously in force in Hong Kong ... shall be maintained, save for any that contravene the Basic Law ..."

and

"The legislative power of the Hong Kong Special Administrative Region shall be vested in the legislature of the Hong Kong Special Administrative Region ...".

Also,

"The laws of the Hong Kong Special Administrative Region shall be the Basic Law, and the laws previously in force in Hong Kong and laws enacted by the Hong Kong Special Administrative Region legislature ...".

171. The constitution of the PRC provides inter alia the following:

"Article 31

The state may establish special administrative regions when necessary. The systems to be instituted in special administrative regions shall be prescribed by law enacted by the National People's Congress in the light of the specific conditions.

Article 57

The National People's Congress of the People's Republic of China is the highest organ of state power. Its permanent body is the Standing Committee of the National People's Congress.

Article 58

The National People's Congress and its Standing Committee exercise the legislative power of the state.

Article 62

The National People's Congress exercises the following functions and powers:

...

(13) to decide on the establishment of special administrative regions and the systems to be instituted there;" (emphasis supplied)

172. The Joint Declaration is reflected in the Basic Law with little change. The Basic Law was adopted by the 7th National People's Congress and was promulgated by the President on 4th April 1990.

173. On the same day by a decision of the National People's Congress ("the NPC"), the Preparatory Committee for the HKSAR was established.

174. Clauses 2 and 6 of that Decision are in point. The relevant parts read:

"2. Within the year 1996, the National People's Congress shall establish a Preparatory Committee for the Hong Kong Special Administrative Region, which shall be responsible for matters relating to the preparation of the establishment of the Region and shall prescribe the specific method for forming the first Government and the first Legislative Council in accordance with this Decision."

Clause 6 sets out the composition of the first Legislative Council and the conditions to be imposed for those who were to become members of it. Significantly the term of office of members of the first Legislative Council shall be two years - the balance of a 4-year term after the 1995 elections - a through legislative train was intended.

175. The Basic Law is Chinese law applicable to the HKSAR and is semi- constitutional in nature. It falls for the Hong Kong courts with specified limits to interpret its provisions. The whole tenor of the Basic Law - following the Joint Declaration - is to establish continuity save for those changes necessary upon the Chinese resumption of sovereignty. This principle pervades the whole of the Basic Law and it addresses all aspects of the HKSAR public life. Relevant to our consideration, there are provisions for the continuity of laws, the judiciary, the legal system and the legislature. I now turn to consider the individual questions posed but before I do so, I address one submission by Mr Chandler in which he takes a discrete point, i.e. in any event the offence of common law conspiracy is not applied to the HKSAR by the Basic Law. It is convenient to deal with that issue now.

Section 159E of the Crimes Ordinance, Cap. 200

176. This engages the true interpretation of the words "the laws previously in force in Hong Kong" which appear, among others, in Articles 8, 18 and 160 of that law. It is those Articles that are mainly relied upon by the Solicitor General in his submissions for the Government. These provisions have been set out by the Chief Judge in his judgment. I do not repeat them here although I will do so later in my judgment.

177. The Crimes (Amendment) Ordinance 1996 came into force on 2nd August 1996. Section 159E(1) as amended provides:

"Subject to the following provisions of this section, the offence of conspiracy at common law is abolished."

However, sub-section (7) provides that sub-section (1) above does not affect:

"Any proceedings commenced before the time when this part comes into operation."

There is no doubt that the proceedings under count of Indictment 1 of 1997 were valid when commenced and when the trial began. Were the laws which validated those proceedings "laws previously in force in Hong Kong"?

178. Three "cut-off' dates for laws previously in force are suggested as possible:

(a) 19th December 1984. The signing of the Joint Declaration.

(b) 4th April 1990. The promulgation of the Basic Law.

(c) 1st July 1997. The coming into force in Hong Kong of the Basic Law.

179. As the Basic Law was not in force in Hong Kong until 1st July 1997 on the narrow point which arises in this reference, the Basic Law can only refer to those laws previously in force before 1st July 1997. That is the 'cut-off' date.

180. The words "the laws previously in force in Hong Kong" refer to the law as it was on 30th June 1997 and as it was at the time when the trial of the defendants began. Subject to the other submissions to which I will turn, Articles 8, 18 and 160 do provide for the application to the HKSAR of the law in force on 30th June 1997. On 1st July 1997 these articles validate the offence charged in count 1, the Indictment and those proceedings. That, of course, is subject to consideration of the other issues to which I now turn.

Is the offence at common law of conspiracy to pervert the course of public justice part of the laws of the HKSAR?

181. Before 1st July 1997 the common law applied to Hong Kong. Arguably, the common law was applied here since Captain Elliot's Declaration in 1841 - as was assumed in s.5 of the Supreme Court Ordinance 1844. The purpose of the Application of English Law Ordinance Cap. 88 which came into force in 1966 was - as it said in the preamble - "to declare the extent to which English law is in force in the Colony".

182. There is no doubt that the common law does not apply to the HKSAR after the change of sovereignty unless it is applied to the HKSAR by Chinese law. This is a self-evident proposition. It is not necessary to consider the provisions of the Hong Kong Act 1985 to the same effect.

183. The Solicitor General (Mr Andrew Bruce, SC, and Miss Wan with him) appears for the Government. His main submission is that the Basic Law applies the common law to the HKSAR since 1st July 1997. He relies particularly upon Articles 8, 18 and 160. These provide:

"Article 8

The laws previously in force in Hong Kong, that is, the common law, rules of equity, ordinances, subordinate legislation and customary law shall be maintained, except for any that contravene this Law, and subject to any amendment by the legislature of the Hong Kong Special Administrative Region.

Article 18

The laws in force in the Hong Kong Special Administrative Region shall be this Law, the laws previously in force in Hong Kong as provided for in Article 8 of this Law, and the laws enacted by the legislature of the Region.

Article 160

Upon the establishment of the Hong Kong Special Administrative Region, the laws previously in force in Hong Kong shall be adopted as laws of the Region except for those which the Standing Committee of the National People's Congress declares to be in contravention of this Law. If any laws are later discovered to be in contravention of this Law, they shall be amended or cease to have force in accordance with the procedure as prescribed by this Law.

Documents, certificates, contracts, and rights and obligations valid under the laws previously in force in Hong Kong shall continue to be valid and be recognised and protected by the Hong Kong Special Administrative Region, provided that they do not contravene this Law."

184. However, counsel for the defendants submit to the contrary. They contend that the words in Article 8

"the laws previously in force in Hong Kong ... shall be maintained ...",

the words in Article 18

"the laws in force in the Hong Kong Special Administrative Region shall be this law, the laws previously in force in Hong Kong ...",

and the words in Article 160

"upon the establishment of the Hong Kong Special Administrative Region, the laws previously in force in Hong Kong shall be adopted as laws of the Region ..."

require some positive instrument of acceptance or act of adoption before the provisions take effect. They contend that there has been no such instrument or act of adoption.

185. The Decision of the Standing Committee of the NPC of the 23rd February 1997, they submit, reinforces the argument. That Decision sets out Article 160 and Article 8 of the Basic Law and by clause 1 adopts the common law as law previously in force in Hong Kong but by Annex I, the Application of English Law Ordinance Cap. 88 is specifically not adopted as a law of the HKSAR.

186. Additionally, they rely upon the terms of the Reunification Ordinance, pointing out that the Ordinance only preserves those laws which "have been adopted as laws of the HKSAR". See s.5(4) and s.7.

187. The 23rd February 1997 Decision of the Standing Committee of the NPC and the two sections of the Reunification Ordinance, they submit, reinforces their contention that an act of adoption was necessary. There was no such act and, further, the decision not to adopt the Application of English Law Ordinance, indicates an intention not to adopt the common law. Therefore, the common law has not survived or been applied since the change of sovereignty.

188. Finally, the defendants submit that no reliance can be placed upon the terms of the Reunification Ordinance because the provisional legislature has not been established according to law and is not competent, therefore, to pass valid legislation for the HKSAR.

Conclusion on the first question

189. We have heard cogent submissions on how the Court should approach the interpretation of the Basic Law. The Basic Law is made under Article 31 of the Constitution of the People's Republic of China. It is Chinese law applicable to Hong Kong which falls initially to be interpreted by Hong Kong courts used to interpreting laws passed in the common law tradition, applying common law principles. No doubt, from time to time, difficult questions of interpretation will arise, but not, it seems to me, from any inherent difficulty arising between the two traditions. The common law principles of interpretation, as developed in recent years, are sufficiently wide and flexible to purposively interpret the plain language of this semi-constitutional law. The influence of international covenants has modified the common law principles of interpretation.

190. The Court has the additional assistance of the Joint Declaration if there is real ambiguity. What is more, although there is an official English translation, the Standing Committee of the NPC decided on 28th June 1990 that "in case of discrepancy between the two texts in the implication of any words used, the Chinese text shall prevail".

191. The general principle was stated in AG of the Gambia v Jobe [1984] AC 689 at 700 where Lord Diplock said:

"A constitution and in particular that part of it which protects and entrenches fundamental rights and freedoms to which all persons in the state are to be entitled, is to be given a generous and purposive construction."

192. The words of Lord Wilberforce in Minister of Home Affairs v Fisher [1980] AC 319 at 328 are also of value:

"These antecedents... call for a generous interpretation avoiding what has been called 'the austerity of tabulated legalism,' suitable to give to individuals the full measure of the fundamental rights and freedoms referred to. ... Respect must be paid to the language which has been used and to the traditions and usages which have given meaning to that language. It is quite consistent with this, and with the recognition that rules of interpretation may apply, to take as a point of departure for the process of interpretation a recognition of the character and origin of the instrument, and to be guided by the principles of giving full recognition and effect to those fundamental rights and freedoms with a statement of which the Constitution commences."

193. However, in my judgment, the language in the Basic Law is so clear that the first question can be answered without falling back on these principles of interpretation.

194. The Solicitor General submits that the decision of the NPC not to adopt the Application of English Laws Ordinance Cap. 88 is of no significance as the Ordinance was in any event purely declaratory. The common law has been applied in Hong Kong probably since 1841, certainly since 1844. Further, no formal act or instrument of adoption was required. The language of the Basic Law in Articles 8, 18 and 160 is imperative and clear. The Basic Law adopts the common law save where excepted as being in contravention of it in the Standing Committee of the NPC's Decision of 23rd February 1997.

195. I agree with these submissions. Indeed, on the first question I do not find the contrary to be arguable. My answer to the first question, therefore, is in the affirmative. The common law previously applied in Hong Kong was adopted into the law of the SAR on 1st July 1997 by the Basic Law.

Are the accused liable to answer to and be tried count 1 of Indictment No. 1 of 1997?

196. It does not follow, of course, because the common law is applied, as we have decided under the first question posed, that is sufficient to validate the continuance of the proceedings and indictments that have been started before the change of sovereignty. The defendants submit that the indictment lapsed with the end of British sovereignty and its legal effect is not preserved either by the Basic Law or under the Reunification Ordinance. The defendants were committed for trial, the proceedings were instituted and the indictment was filed in the High Court under British sovereignty. At midnight on 30th June 1997 when the PRC resumed sovereignty. the Supreme Court (of which the former High Court was part) ceased to exist. It is contended that even if the common law has been applied by the Basic Law it contains no provision which has either preserved the indictment or given the HKSAR courts the power to try the defendants either for offences committed or on proceedings commenced before the change.

197. Further, the Reunification Ordinance which purports to provide for the continuity of legal proceedings and associated matters in Parts 4 and 5 is not effective because the Ordinance was passed by the provisional legislature which is not legally constituted as the legislature of the SAR.

198. The Solicitor General submits that Article 160 of the Basic Law is a sufficient answer and on its true construction provides for the validity of the indictment and the continuation of the criminal proceedings. He says this does not depend upon the Reunification Ordinance which is only declaratory of the provisions of this Article. He relies in particular upon the second paragraph of Article 160 which provides:

"Documents, certificates, contracts, and rights and obligations valid under the laws previously in force in Hong Kong shall continue to be valid and be recognised and protected by the Hong Kong Special Administrative Region, provided that they do not contravene this Law."

Conclusion on the second question

199. I am satisfied that for the reasons I have given that the words "the laws previously in force in Hong Kong" apply to laws relevant to this criminal trial which were in force on 30th June 1997. The question is, therefore, whether the words "documents" and "rights and obligations" are sufficient to apply to and preserve the validity of the indictment and the criminal trial dependent upon it. Mr Chandler submits that these words must be construed eiusdem generis with the words "certificates" and "contracts" and may on their true meaning be relevant to civil rights and obligations and documents supporting those rights but not to criminal proceedings. He could have added that as the construction contended for by the Solicitor General has penal consequences the Court ought to lean against such a construction.

200. Undoubtedly, it is unusual for important transitional provisions dealing with the validity of trials continuing over the resumption of sovereignty should be so generally expressed. But then the Basic Law is enacted in broad terms and general principles.

201. I pose the question: in the absence of any other valid provision is this sufficient and appropriate to preserve the proceedings referred to us?

202. Bearing in mind the principles to which I have referred when considering the interpretation of the Basic Law on the first question and the overwhelming intention of the Basic Law - and the Joint Declaration which was its genesis - to provide for the continuity of the legal system and the law, I believe a strongly purposive construction of the Basic Law is justified and required by those principles. Not without some initial hesitation but nevertheless in the end without doubt, I would decide, first, that the word "documents" is sufficient to apply to and preserve the validity of the indictment upon which the criminal trial is founded. Secondly, the words "rights and obligations" are appropriate and sufficient to continue the right of the Government to prosecute the case and the obligation of the defendants to appear.

203. On this question, as the other, the Reunification Ordinance is clear. I turn now to consider the question whether the Reunification Ordinance has legal effect, in other words, whether it has been validly passed by a competent legislature.

Is the Provisional Legislative Council established by law?

204. This question is addressed because it is submitted by the defendants that the Reunification Ordinance is devoid of legal effect as it was not passed by a competent legislature.

205. I have already outlined the legislative history of the Basic Law and the establishment of the Preparatory Committee by the 4th April 1990 Decision of the NPC. The proposed composition and conditions for membership of the first Legislative Council are to be found in Annex II of the Basic Law and the above Decision. Annex II clause 1 provides:

"The Legislative Council of the Hong Kong Special Administrative Region shall be composed of 60 members in each term. In the first term, the Legislative Council shall be formed in accordance with the 'Decision of the National People's Congress on the Method for the Formation of the First Government and the First Legislative Council of the Hong Kong Special Administrative Region'."

The relevant parts of the 4th April 1990 Decision, clause 1, 2 and 6 have already been set out in earlier judgments in full and I do not repeat them. The intention was to achieve a legislative through train by providing that members of the last colonial legislature who could meet the conditions should be considered as members of the First Legislative Council under the HKSAR.

206. During 1994, the new electoral arrangements for the 1995 election to the last colonial Legislative Council were introduced. It is no part of this Court's task to express a view on those arrangements. The view of the Government of the PRC was clear. The electoral arrangements unilaterally decided upon by the British Government were in breach of the Joint Declaration, the Basic Law and the Decision of the NPC of the 4th April 1990. The wholesale changes which would be required in order to comply with the provisions of Annex II of the Basic Law and the Decision of the 4th April 1990 to establish the first Legislative Council under the HKSAR and the Basic Law were not reasonably possible.

207. It was in these circumstances that on 31st August 1994 the Standing Committee of the NPC, having set out the background, decided

"The Session hereby decides that the Preparatory Committee for the HKSAR shall be responsible for matters relating to the preparation of the establishment of the HKSAR, prescribe the specific method for the formation of the First Legislative Council of the HKSAR and organise the First Legislative Council of the HKSAR in accordance with the Decision of the NPC on the Method for the Formation of the First Government and the First Legislative Council of the HKSAR."

In our system we would describe this as an enabling provision.

208. For its part the Preparatory Committee - acting in accordance with Article 2 of the 4th April 1990 Decision - decided on 24th March 1996 to form the Provisional Legislative Council. The Decision provided the means of doing so, its powers and finally and significantly by clause 7:

"The Provisional Legislative Council of the HKSAR shall operate until the First Legislative Council of the HKSAR is formed, which shall be not later than 30 June 1998."

209. Further details for the formation of the PLC were laid down by the Preparatory Committee on 5th October 1996. On 1st February 1997 the Preparatory Committee decided inter alia that

"the Provisional Legislative Council shall start functioning before 30 June 1997. The Provisional Legislative Council shall, ... formulate standing orders and voting procedures, examine and pass bills etc. upon the establishment of the HKSAR, the Provisional Legislative Council shall confirm bills which have been passed and submit them for the signing of the Chief Executive before promulgation and implementation so as to complete the legislative process."

210. Finally, the Preparatory Committee reported to the NPC. The report contains these passages:

"Some doubts have been raised in Hong Kong's public opinion about the power of the Preparatory Committee in making decision on the formation of the Provisional Legislative Council. In fact, Article 2 of the above-mentioned Decision of the NPC provides that the Preparatory Committee 'shall be responsible for matters relating to the preparation for the establishment of the HKSAR'. The formation of the Provisional Legislative Council falls within this ambit. As a power organ established by the NPC, the Preparatory Committee has been authorized to make decisions on matters relating to the establishment of the HKSAR.

This authorization covers the power to form the Provisional Legislative Council.

In the light of the actual situation that a legislature must be in place upon the establishment of the HKSAR and in accordance with the above-mentioned Decision of the NPC, the plenary session of the Preparatory Committee in March 1966 adopted the Decision to form the Provisional Legislative Council of the HKSAR."

211. On 14th March 1997 the NPC by resolution approved that report.

212. With that legislative background, I turn to the submissions of counsel.

213. Ms Gladys Li, SC, made submissions on this issue for the 1st defendant which the other defendants adopted. The thrust of her argument is as follows and I hope I do no injustice to it:

(1) As can be seen from the preamble to the Basic Law and Article 158 the precise limit of the jurisdiction of the Hong Kong courts may cause difficulty. Further, the statement of principles applicable to Hong Kong indicate that certain articles of the constitution of the PRC do not apply to the HKSAR. See for example Articles 123 and 129.

(2) The courts of the HKSAR may therefore consider whether the NPC or its standing committee has made a decision which has legislative effect and to what effect.

(3) Consequently, in this reference this Court may inquire whether the PLC has been established by law; and secondly, whether the PLC conforms with the law of the HKSAR - the Basic Law.

(4) Article 158 of the Basic Law gives wide powers of interpretation to this Court - its decisions being appealable. Note the words

"... if the courts of the Region ... need to interpret the provisions of this Law concerning affairs which are the responsibility of the Central People's Government, or concerning the relationship between the Central Authorities and the Region, and if such interpretation will affect the judgment on the cases, the courts of the Region shall before making their final judgments which are not appealable, seek an interpretation of the relevant provisions from the Standing Committee of the National People's Congress to the Court of Final Appeal in the Region."

(5) Therefore, this Court can determine whether the PLC conforms with the Basic Law although it may not make the ultimate determination. What is more, it is the duty of this Court to do so.

(6) That the PLC does not conform with the Basic Law, it is not legally constituted and the enactments passed by it - the Reunification Ordinance for the purposes of this case - are of no effect. She relies upon the following reasons:

(a) That in spite of the Government's contentions, the PLC is the first Legislative Council of the HKSAR and does not conform with the provisions for the establishment of it.

(b) It does not conform with the general principle that "the legislature shall be constituted by election" in the Joint Declaration and the Basic Law. It was not formed by the method laid down in Article 68, Annex II and clause 6 of the 4th April 1990 Decision of the NPC.

(c) That in forming the PLC, the Preparatory Committee did not even pay lip service to clause 6 when making its Decision of the 31st August 1994 and was not acting within the powers conferred upon it.

(d) Finally, that if the legality of the PLC depends upon the "approval" of the Preparatory Committee on 14th March 1997, then this is obviously not sufficient to 'ratify' that which had been done contrary to the Basic Law so as to legitimise the PLC.

(7) In order to establish a valid PLC an amendment to the Basic Law was necessary and this was not done.

214. In answer to this, the Solicitor General's primary submission is that this Court is a regional court and it is out with its jurisdiction to inquire into the legality of laws enacted by the sovereign power. The NPC is the "highest organ of state power" (see Article 57 of the Constitution) and with its Standing Committee is entrusted to "exercise the legislative power of the state" (Article 59). The legality or validity of laws made by these bodies is not open to challenge in the Hong Kong courts. For my part, I regard that as a self-evident proposition. I did not understand Ms Li, SC, to suggest otherwise at any rate for the purpose of this reference.

215. However, it is open to the Hong Kong courts to enquire whether laws have been enacted by the NPC or its Standing Committee and to consider the effect of such laws. It is open to the Hong Kong courts to examine whether a body such as the PLC has been established under and in accordance with those valid laws.

216. Sometimes, the court may need for this the assistance of experts. In this reference there has been no suggestion or challenge that the text of the decisions and resolutions of the NPC and the Standing Committee put before us are not laws which were enacted by them. As to the effect of these laws, the presumption is that things are lawfully and properly done unless the contrary is demonstrated. For reasons which I will give, I am firmly of the opinion that the contrary has not been demonstrated before us. It is open to us, therefore, to accept those decisions at their face value.

217. Earlier, I have traced the legislative history of the PLC. The Preparatory Committee was empowered to take the necessary steps in accordance with the NPC Decision of the 4th April 1990 and the Basic Law to prepare for the establishment of the HKSAR. At that time, this included the establishment of the first Legislative Council.

218. It is not our task to examine whether the electoral changes which came into being before the 1995 election made it impossible to establish the first legislature in accordance with that Decision and the Basic Law. It is certainly arguably so. This was the clear perception of those responsible for implementing the Basic Law after the resumption of sovereignty; that is, the perception that the legislative through train had been derailed and that it could not be put back on the tracks before 1st July 1997.

219. It was in those circumstances that the Preparatory Committee exercising its powers to make arrangements for the establishment of the HKSAR set up the PLC with its limited functions and powers to fulfil the role of the legislative arm of government until replaced by an elected legislature - the first Legislative Council under the Basic Law - not later than 30th June 1998.

220. Any lingering question as to the lawful exercise of the Preparatory Committee's powers in establishing the PLC was, in my judgment, removed on the 14th March 1997 when the NPC resolved to approve a Preparatory Committee's report which among other things detailed the way in which the provisional legislature had been established. Ms Li submits that this resolution amounted to narrative without ratification. Without any evidence to the contrary, the resolution must be accepted as meaning what it says - that the legislature approved that which the Preparatory Committee had done in the exercise of the powers granted to it.

The PLC and the Basic Law

221. This leaves Ms Gladys Li's submission that the PLC is established in breach of the Basic Law and that on this ground it must be held to be incompetent as the Legislative Council of the HKSAR. This is founded upon the premise that the provisional legislature is the first Legislative Council under the Basic Law and does not comply with Article 68, Annex II and the 4th April 1990 Decision of the NPC.

222. But this premise is not correct. The 31st August 1994 Decision of the Standing Committee of the NPC states the Standing Committee's view that the 1994 electoral arrangements in Hong Kong are in contravention of the Joint Declaration, the Basic Law and the Decision of the NPC. Consequently, in that Decision the Standing Committee gave the Preparatory Committee the responsibility of prescribing the specific method for the formation of the first Legislative Council. Clearly, elections could not be held by the Preparatory Committee before the 1st July 1997. It appears from their decisions that the route they chose was to establish the PLC as an interim body until the first legislature could be established under, and in accordance with, the Basic Law.

223. This is clear from the Decision of the Preparatory Committee of 24th March 1996 to set up the PLC. By clause 7, to which I have already referred, it decided that the PLC should operate until the first Legislative Council of the HKSAR was formed not later than 30th June 1998.

224. Where there are separate provisions dealing with the same subject matter, the principles of interpretation require that the provisions are interpreted to be consistent with one another if the language will bear such meaning. Failing this, the later provision takes precedence. Here, however, for my part, there is no difficulty. Article 68 indicates that the method for forming the Legislative Council was not set in stone. The second paragraph provides:

"The method for forming the Legislative Council shall be specified in the light of the actual situation in the Hong Kong Special Administrative Region and in accordance with the principle of gradual and orderly progress. The ultimate aim is the election of all the members of the Legislative Council by universal suffrage."

I am unable to accept that the provisions for the establishment of the PLC are in breach of the Basic Law. Nor am I of the opinion that any amendment to the Basic Law was required even if such had been practical or possible.

225. It was necessary to have a Legislative Council in place on the 1st July 1997. It was not possible to hold elections for a council which complied with the Basic Law before that date. The Preparatory Committee in accordance with its mandate provided the PLC as an interim body until the necessary arrangements could be made for the establishment of the first Legislative Council under the Basic Law. Far from breaching the Basic Law, therefore, the formation of the PLC was consistent with efforts to comply with the law by making arrangements for the establishment of the first Legislative Council under its provisions before 30th June 1998. The establishment of the PLC was outside the Basic Law and collateral with it. It was part of the arrangements and method for establishing the first Legislative Council.

Conclusion

226. For these reasons I would hold that from 1st July 1997 the common law is adopted in the HKSAR by the provisions of the Basic Law. I would also hold that the validity and legal effect of proceedings commenced under an indictment before the 1st July 1997 are preserved by the Basic Law after that date.

227. Finally, I would hold that the Reunification Ordinance - which is in part to the same effect - is part of the laws of the HKSAR having been validly enacted by the PLC which is a competent legislature established under the laws enacted by the NPC and its Standing Committee.

228. In these circumstances, I do not find it necessary to address the arguments put before us on the doctrine of necessity.

229. For these reasons I answer both questions referred to us in the affirmative.