SECRETARY FOR JUSTICE v. WONG SAU FONG

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

1997, No.55
(Criminal)

-------------------------------

----------------------

J U D G M E N T

----------------------

Power, V.-P. (giving the judgment of the Court):

1. The respondent originally faced five charges in the District Court. Four of those charges were for evasion of liability by deception contrary to s.18B(1)(b) of the Theft Ordinance, Cap.210, and one was for using a false instrument contrary s.73 of the Crimes Ordinance Cap.200.

2. When the trial, before Judge Davies, commenced the prosecution offered no evidence in respect of the false instrument charge and it was dismissed. At the conclusion of the trial, the respondent was acquitted of all charges of evasion of liability by deception. The Attorney General, now the Secretary for Justice, required the District Judge to state a case against the verdict on the first charge. That charge was particularized as follows:

"Wong Sau-fong, on or about 27th day of October 1995, in Hong Kong, with intent to make default in whole or in part on an existing liability to make a payment of $1,470,000 United States currency to Zhong Shan Company Limited, by deception, namely by falsely representing that a sum of $1,530,771.48 United States currency had been transferred to the said Zhong Shan Company Limited's account maintained with Nanyang Commercial Bank Limited, dishonestly induced Yang Shurum claiming payment on behalf of the said Zhong Shan Company Limited to wait for payment."

3. It was the case for the prosecution that in 1995 Madam Yang Shurum, on behalf of the Zhong Shan Company Limited, and the respondent, on behalf of Vincent Max Limited, agreed that Zhong Shan and its subsidiary Zhong Zhan Trading Company would provide funds to Vincent Max by issuing false letters of credit which would provide funds to Vincent Max and its associated companies. The respondent was a director and shareholder of Vincent Max. Altogether eight letters of credit were opened we are concerned only with the fourth of those under which Kongain Limited, an associated company of Vincent Max, was the beneficiary. The respondent was a director and shareholder of Kongain. The 27th October 1995 was the date upon which repayment by Kongain of the amount obtained under this letter of credit was due to Zhong Shan. On that date, the respondent told Madam Yang that she had effected a telegraphic transfer of funds to Zhong Shan and faxed a copy of a telegraphic transfer application form to Madam Yang evidencing that transfer. It was the respondent's evidence that she anticipated that a Malaysian company would pay Kongain a trade debt which was in excess of the amount due under the fourth letter of credit at the time when the application form was faxed. She said that when she checked Kongain's account on the following morning, she discovered that no funds had been paid into it and cancelled the application.

4. The judge found that the respondent's assertion to Madam Yang on 27th October 1995 in respect of the remittance, which assertion was reinforced by the faxing of the telegraphic transfer application form, constituted false representations on her part that the money had been transferred to Zhong Shan. He was satisfied that the respondent acted dishonestly. He then, applying the provisions of the English Theft Act 1978, held that the prosecution had to prove an intent to make permanent default. He was not satisfied that the respondent had had that intent and he acquitted.

5. Section 18B(1)(b) of the Hong Kong Theft Ordinance specifically states that the intent to make default need not be a permanent one. The judge was clearly in error when he applied the provisions of the English Theft Act 1978. The questions of law for the Court of Appeal were:

"Was I correct in law in holding that:

(a) the offence of Evasion of liability by deception, under section 18B(1)(b) of the Theft Ordinance Chapter 210, requires the Crown to prove the element of an intent to make permanent default on the part of an accused, and that

(b) section 18B(1)(b) is not intended to apply to a debtor who is merely trying to delay making a payment?"

6. There was no issue before this court that both of the questions have to be answered "No".

7. It was the original contention of Mr. Bruce S.C., who appeared with Mr. Gary Lam for the appellant, that this court should, pursuant to s.84(c) of the District Court Ordinance, proceed to convict and sentence the respondent.

8. The appellant, when seeking that order, was mindful of the decision of The Attorney General v. Yeung Sun-shun & Another (1987) HKLR 987, in which Sir Denys Roberts, delivering the judgment of the court, held that after an acquittal, the Court of Appeal had no power to order that the trial be resumed before the District Court judge. Sir Denys Roberts said, at 999:

"This section is in some respects unsatisfactory, since paragraph (c) of s.84 provides that the Court of Appeal shall:

'(i) if it is satisfied that there is no sufficient ground for interfering, dismiss the appeal; or

(ii) reverse the verdict or order and direct that the trial be resumed or that the accused be retried as the case may be, or find him guilty, record a conviction and pass such sentence on him as might have been passed on him by a judge;'

We do not consider it appropriate that this Court should be obliged to deal with the question of sentence itself, because:

(a) a case-stated contains only a selection of facts and may omit some which have a bearing on sentence, though not on the questions of law involved,

(b) the respondent, if sentenced by this Court, has effectively no right of appeal, as he would have if the matter were returned to the trial judge for sentence; and

(c) the trial judge is in a far better position, by reason of his close knowledge of the whole of the case, than this Court, to assess sentence.

However, we do not think that it is open to us to return the case to the judge for sentence, by reason of the wording of the section. This gives us three options, on reversing the verdict:

(a) order the trial to be resumed. This would be apposite only if the trial had not been completed - e.g. if the judge had found no case to answer. But if there has been an acquittal at the conclusion of a trial, there is no trial that can be resumed - i.e. continued;

(b) order a retrial. This would be appropriate in some cases - e.g. if we had ruled that evidence had been wrongly excluded by the judge. It is not applicable here;

(c) record a finding of guilt and pass sentence.

We suggest for the attention of the legislature that consideration should be given to an amendment to s.84(c) so as to give power to this Court, as an alternative, to convict and remit the case to the trial judge for sentence. ,

It is now our task to record a finding of guilt and to pass sentence on the respondents."

9. It was the respondent's contention that the appellant was right to accept that this court was bound by the decision in Yeung's case, which was followed in 1997 in the unreported decision The Attorney-General v. Ling Kar-fai Crim.App. No.705/96. That matter was also an appeal by way of case stated where the court had initially ordered "that the trial be resumed". Litton V.-P., as he then was, giving the judgment of the court, after reconsideration, said:

"The effect of our order was to 'direct that the trial be resumed' in terms of subsection (ii): resumed, that is, in the sense that the trial judge should consider the verdict afresh in the light of all the evidence and of our determination on the matters of law set out in the Case Stated. But, in A.G., v. Yeung Sun Shun [1987]HKLR 987 - an authority not brought to our attention at the hearing of the appeal - this court gave a narrow construction to s.84(c) and held that when the verdict of acquittal had been given after the defence case was heard, this court is not empowered to direct that the trial be resumed.

Mr. Rodway Q.C. has not submitted to us that we should not follow this authority, giving s.84(c)(ii) the effect as construed in Yeung Sun-shun. The result is that, in the circumstances of this case, we must conclude that the order we made - directing that the matter be remitted to the trial judge for consideration - was outside our jurisdiction as conferred under s.84(c)(ii)."

10. If this court is bound by Yeung's case, then its only power would be to proceed to record a conviction and impose sentence. However, Mr. Paul Wu, who appears for the respondent, submits that, since the enactment of the Bill of Rights Ordinance, that course is also not open as it would, contrary to Article 11(4) of that Ordinance， deprive the respondent of his right of appeal. If the above be correct, this court is powerless to do anything other than answer the two questions in the negative. Faced by the possibility of this manifestly unsatisfactory result, Mr. Bruce, with the encouragement of this court, advanced a preliminary argument submitting that this court was not bound by the decision in Yeung's case. He acknowledged that Young v. Bristol Aeroplane Company Limited [1944] KB 718, which is the rock upon which the modern doctrine of stare decisis rests, was at first sight against him.

11. Lord Greene M.R. delivering the judgment of the court said, at p.729:

"On a careful examination of the whole matter we have come to the clear conclusion that this court is bound to follow previous decisions of its own as well as those of courts of co-ordinate jurisdiction. The only exceptions to this rule (two of them apparent only) are those already mentioned which for convenience we here summarize: (1) The court is entitled and bound to decide which of two conflicting decisions of its own it will follow. (2) The court is bound to refuse to follow a decision of its own which, though not expressly overruled, cannot, in its opinion, stand with a decision of the House of Lords. (3) The court is not bound to follow a decision of its own if it is satisfied that the decision was given per incuriam."

12. As the decision in Yeung's case was clearly not given per incuriam (the position may, however, be otherwise as regards Ling Kar-fai's case) we would, at first sight, appear to be bound to follow Yeung.

13. Mr. Bruce went on, however, to argue that the rule of stare decisis, as set out in Young v. Bristol Aeroplane Co. Ltd., has been modified, in criminal cases, by the decision in R. Taylor [1950] 2 KB 368 where Lord Goddard CJ, delivering the judgment of the Court of Criminal Appeal said, at 371:

"I desire to say a word about the reconsideration of a case by this court. The Court of Appeal in civil matters usually considers itself bound by its own decisions or by decisions of a court of co-ordinate jurisdiction. For instance, it considers itself bound by its own decisions and by those of the Exchequer Chamber; and, as is well known, the House of Lords also always considers itself bound by its own decisions. In civil matters this is essential in order to preserve the rule of stare decisis.

This court, however, has to deal with questions involving the liberty of the subject, and if it finds, on reconsideration, that, in the opinion of a full court assembled for that purpose, the law has either been misapplied or misunderstood in a decision which it has previously given, and that, on the strength of that decision, an accused person has been sentenced and imprisoned, it is the bounden duty of the court to reconsider the earlier decision with a view to seeing whether that person had been properly convicted. The exceptions which apply in civil cases ought not to be the only ones applied in such a case as the present, and in this particular instance the full court of seven judges is unanimously of opinion that the decision in Rex v. Treanor 27 Cr.App.R. 35, was wrong for a reason which I will indicate in a moment."

14. Mr. Bruce submits that if this court is satisfied that the law was "either misapplied or misunderstood" in Yeung's case then its "bounden duty" is "to reconsider the earlier decision ..." He submits that in Yeung's case the court misunderstood and misapplied s.84(c) and that the court in Ling Kar-fai's case was wrong when it indicated that Yeung's case had done no more than give "a narrow construction to s.84(c)". He contends, firstly, that on any reading of s.84(c), the plain intention of the legislature was to give the court power, having reversed the verdict, to direct either that the trial be resumed or that the accused be retried or, if there was plainly no point in sending the matter back to the lower court, to find him guilty and pass sentence. He attacks the justification for giving a narrow construction which is set out in the following passage from Sir Denys Roberts' judgment:

"However, we do not think that it is open to us to return the case to the judge for sentence, by reason of the wording of the section. This gives us three options, on reversing the verdict:

(a) order the trial to be resumed. This would be apposite only if the trial had not been completed - e.g. if the judge had found no case to answer. But if there has been an acquittal at the conclusion of a trial, there is no trial that can be resumed - i.e. continued;

(b) order a retrial. This would be appropriate in some cases - e.g. if we had ruled that evidence had been wrongly excluded by the judge. It is not applicable here;

(c) record a finding of guilt and pass sentence."

He submits that to hold that there was no power to order the trial be resumed because the trial had been "completed" by acquittal must be wrong as it loses sight of the fact that the court, before turning to make that order, has by reversing the verdict quashed the acquittal. The submission is, and there seems to us to be considerable force in it, that once a court has reversed the verdict, there is no longer any acquittal and the trial has, therefore, not been completed. He submits that the legislature plainly intended that the court of appeal, having reversed the verdict, should have the power to direct that the trial be resumed. He contends that the indication, in (a) above, that it would only be appropriate to order that the trial be resumed if, for example, the judge had found no case to answer is logically unsustainable. A judge, having found no case to answer, would then proceed to dismiss the charge and to acquit the defendant. There would, in such circumstances, then be an acquittal and the trial would be completed and, if the reasoning in Yeung's case be correct, there would be no trial that could be resumed.

15. Mr. Bruce launches the same attack on the reasoning in (b) above. He submits that, once the verdict is reversed, the court must have an unlimited power to order a retrial and that it would be illogical to confine this to a limited class of cases such as, to take the example given by Sir Denys, where evidence had been wrongly excluded.

16. We find considerable merit in these arguments and, had we come upon this matter at first instance, might well be persuaded by them. However, we cannot examine them on their merits unless we are persuaded that we are not bound by the rule of stare decisis to follow the decision in Yeung's case. In Taylor's case, it was held that the full court of the Court of Criminal Appeal, assembled for the purpose of reconsidering a question involving the liberty of the subject, may reconsider an earlier decision of the Court of Criminal Appeal with a view "to seeing whether that person has been properly convicted". Taylor's case originally came before a court of three judges and was referred by them for consideration by a full court consisting of Lord Goddard C.J. and six other judges. We are not a full court of the Court of Criminal Appeal and, for that reason alone, it would not be proper for us to reconsider the decision in Yeung's case. Even if that were not so, we are in doubt whether it would be proper for us to reconsider that decision as this matter, as it presently stands, does not involve a determination as to whether a person has been properly convicted. The correctness of that latter view might well, however, be open to argument as our determination could clearly result in a conviction. However that may be, we are not a full court convened for the purpose of considering a question of stare decisis and it would not be proper for us to do so.

17. We return to Mr. Wu's contention that, being bound by Yeung's case, we are precluded by the Bill of Rights from doing anything more than answering the two questions posed. Article 11(4) of the Bill of Rights reads:

"Everyone convicted of a crime shall have the right to his conviction and sentence being reviewed by a higher tribunal according to law."

Mr. Wu submits that this gives every convicted person an "unfettered right" of appeal.

18. The right of appeal of a person convicted in the District Court is given by s.83 of the District Court Ordinance which states that "Sections 80 to 83Y inclusive of the Criminal Procedure Ordinance shall apply to criminal proceedings in" the District Court. Section 82 of the Criminal Procedure Ordinance provides that a person convicted of an offence may appeal to the Court of Appeal against his conviction on any ground which involves a question of law alone and, with the leave of court, on any ground which involves a question of fact alone or a question of mixed law and fact or on any other ground which appears to the Court of Appeal to be a sufficient ground of appeal. It goes on to provide that "if the judge of the court of trial grants a certificate that the case is fit for appeal on a ground which involves a question of fact, or a question of mixed law and fact, an appeal lies under this section without the leave of the Court of Appeal." Mr. Wu submits that a clearly unfettered right is given where only a question of law is involved and where the judge of the court of trial has granted a certificate. He concedes that leave must be granted where questions of fact alone or mixed questions of law and fact are involved, but points out that the law as administered in Hong Kong allows all applicants fully to ventilate their appeal when making their application for leave. He submits that if the Court of Appeal convicts under s.84(c) of the District Court Ordinance the conviction is clearly a conviction by the Court of Appeal. This, he argues, is plain from the words of the section which paraphrased read: "at the hearing of the appeal ... the Court of Appeal shall ... reverse the verdict ... find him guilty, record a conviction and pass such sentence on him as might have been passed on him by a judge".

19. Mr. Bruce, as we understand him, does not seek to argue otherwise.

20. Mr. Wu goes on to argue that the right given by s.82 has, therefore, gone and that the only appeal left is an appeal to the Court of Final Appeal under s.31 and s.32 of the Hong Kong Court of Final Appeal Ordinance. Section 31 provides that an "appeal shall at the discretion of the court, lie to the court in any criminal cause or matter, at the instance of any party to the proceedings from ... any final decision of the Court of Appeal." Mr. Wu points out that the appeal lies "at the discretion of the court" and that no such words appear in s.82 of the Criminal Procedure Ordinance. Section 32 indicates the nature of that discretion as follows:

"(1) no appeal shall be admitted unless leave to appeal has been granted by the Court;

(2) leave to appeal shall not be granted unless it is certified by the Court of Appeal or the High Court, as the case may be, that a point of law of great and general importance is involved in the decision, or it is shown that substantial and grave injustice has been done;

(3) where the Court of Appeal or the High Court declines to certify as mentioned in subsection (2), the Court may so certify and grant leave to appeal".

21. Mr. Wu submits that the fetter on the right of appeal under s.82, i.e. the necessity in some cases to obtain leave, is not one of any real significance and is certainly not to be compared to an appeal, subject to discretion and condition, as provided by s.31 and s.32. He submits that the requirement that the appeal involve a point of law of great and general importance or the occurrence of a substantial and grave injustice is a heavy fetter on the right of appeal. He refers finally to s.3(2) of the Hong Kong Bill of Rights Ordinance which provides that: "All pre-existing legislation that does not admit a construction consistent with this Ordinance is, to the extent of the inconsistency, repealed." He submits that s.84(c)(ii) of the District Court Ordinance, insofar as it allows the Court of Appeal to record a conviction and pass sentence on a respondent, is inconsistent with Article 11(4) and is, to the extent of that inconsistency, repealed.

22. Before turning to consider Mr. Bruce's contentions, we make it plain that we do not agree with Mr. Wu's use of the word "unfettered". We are satisfied that the section means what it says. It guarantees to convicted persons a right of appeal.

23. Mr. Bruce makes a number of submissions.

(i) He submits that the respondent cannot contend that she had been denied a right of appeal to the Court of Appeal as that right could be exercised by her during the hearing of the Case Stated.

24. Mr. Bruce contends that even where an appeal is submitted as a certified question of law, it is open to the appellate court to go outside that question in order to do justice between the parties. He supports this contention by reference to the procedure adopted in the House of Lords in A.G. of Northern Ireland v. Gallagher [1963] AC 349, and in R. v. Secretary of State for Home Department ex parte Launder [1997] 1W.L.R. 839. We do not need to dwell long on this contention. Whatever the position may be in the House of Lords, we are satisfied that we are bound in these proceedings by the terms of s.84 of the District Court Ordinance. This sets out in the clearest terms the procedure to be followed and the power of this court to deal with the matter brought before it. This court is to consider a case "setting forth the facts and the grounds on which the verdict or order was arrived at or made and the grounds on which the proceeding is questioned ....." There is no provision for any parallel appeal by the respondent. We find no merit in this argument.

(ii) Mr. Bruce concedes that there is no appeal to the Court of Appeal, but contends that there is an appeal to the Court of Final Appeal. He acknowledges that that appeal is, to an extent, fettered by the terms of s.31 and s.32 of the Court of Final Appeal Ordinance but argues that fetters also exist on the right of appeal to the Court of Appeal. We are satisfied that no valid comparison can be made between the two appellate procedures. Any fetters upon the right of appeal to the Court of Appeal are such as are standard in almost all common law jurisdictions and have never been regarded as hindering in any material way the right of an appellant, whose appeal has any merit, to have that appeal heard. The right of appeal to the Court of Final Appeal is, on the other hand, clearly and intentionally heavily circumscribed. The function of that court is set out in the decision of Bokhary P.J. in Kwok Hung Fung v. HKSAR , M.P. No. 13 of 1997, in which he said, at p.5:

"The Court of Final Appeal does not sit as a court of criminal appeal in the ordinary way. In the administration of criminal justice, its primary role is the one under the first limb of s.32(2), and that is to resolve real controversy on points of law of great and general importance. The second limb is a residual safeguard designed for those rare and exceptional cases in which there is a real danger of something so seriously wrong that justice demands an inquiry by way of a final criminal appeal despite the absence of any real controversy on any point of law of great and general importance."

25. This makes it plain, as regards the first limb, that there is no unfettered right of appeal to the Court of Final Appeal. Mr. Bruce, however, argues that the respondent would undoubtedly be given leave to appeal under the second limb which Bokhary PJ describes as "a residual safeguard designed for those rare and exceptional cases in which there is a real danger of something so seriously wrong that justice demands an inquiry ..." Mr. Bruce submits that if a respondent was deprived of his right of appeal by the recording of a conviction by the Court of Appeal under s.84(c)(ii), the Court of Final Appeal, so as to avoid the grave injustice that would be done were a person wholly to be deprived of his right of appeal, would, without doubt, grant leave to appeal under the second limb. This might be so, but we are satisfied that this cannot be equated with the right of appeal which is guaranteed by Article 11(4) of the Bill of Rights Ordinance.

(iii) Mr. Bruce goes on to argue that even if there is no direct right of appeal, a respondent convicted under s.84(c)(ii) would not be deprived of an indirect right of appeal as he would have the right under s.83P of the Criminal Procedure Ordinance to apply to the Chief Executive to refer his case to the Court of Appeal. Section 83P provides that once a reference is made by the Chief Executive "the case shall be treated for all purposes as an appeal to the Court of Appeal by" the convicted person. Mr. Bruce argues that an application by a person convicted by the Court of Appeal under s.84(c)(ii) would undoubtedly be granted by the Chief Executive as justice would demand that the applicant be not deprived of his right of appeal. However that may be, we are again satisfied that this also cannot be equated with the right of appeal guaranteed by Article 11(4).

(iv) Mr. Bruce argues that even if s.84 involves a derogation of the right of appeal, it is an acceptable one because of the other avenues open which are set out above. We cannot agree, for the reasons we have set out above, we are satisfied that there would be a real and substantial derogation of the right to appeal guaranteed by Article 11(4).

26. Mr. Bruce turns finally to s.3 of the Hong Kong Bill of Rights Ordinance. We should have indicated earlier that neither party sought to contend that the repeal of s.3 by the Standing Committee of the National People's Congress which took effect from 1st July 1997 had any application to these proceedings. The pre-July 1997 law, therefore, has application. We have already made reference to the reliance placed by Mr. Wu on s.3(2). Mr. Bruce, however, places reliance upon s.3(1) which reads:

"All pre-existing legislation that admits of a construction consistent with this Ordinance shall be given such a construction."

He submits that we are enjoined by that section to give a construction to s.84 consistent with Article 11(4) and are not bound by the earlier construction in Yeung's case, delivered before the Bill of Rights Ordinance came into existence, which would make the section inconsistent with Article 11(4) and invalid. We are satisfied that this contention is correct. Are we, however, bound by the decision in Ling Kar-fai, delivered after the Bill of Rights Ordinance was enacted, which proceeded upon the basis that s.84(c)(ii) is not invalidated by the Bill of Rights Ordinance? We are satisfied that we are not. Section 3 of the Bill of Rights Ordinance was never raised in Ling Kar-fai's case. Counsel conceded without argument that Yeung should be followed. We are respectfully satisfied thatLing Kar-fai's case can be regarded as having been decided per incuriam and is not binding upon us. We are satisfied, reading s.84(c)(ii) so as to make it consistent with Article 11(4) of the Bill of Rights, that we have power not only to reverse the verdict but also to order that the trial be resumed in the District Court.

27. We answer both of the questions in the negative, we reverse the verdict of acquittal and direct that the trial be resumed in the District Court.