HKSAR v. CHEN KEEN (alias JACK CHEN) AND ANOTHER

HCCC 309/2019

[2023] HKCFI 2484

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 309 OF 2019

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R U L I N G

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The Application

1.  On 3 July 2023, the first day of the present trial, Notices of Motion were respectively filed by the 1^st accused and the 2^nd accused (collectively referred to as “the Applicants”) applying to this Court for an order to certify under section 32(2) of the Hong Kong Court of Final Appeal Ordinance, Cap. 484 (“HKCFAO”) that three points of law of great and general importance are involved in the rulings of this Court on 26 and 29 June 2023.

2.  The three questions of law jointly raised by the Applicants are set out as follows:

(1)  In the context of charges of conspiracy to defraud the Stock Exchange and shareholders of a listed company, where false representations are said to have been made as to connections between the directors of the listed company and the vendor in a very substantial acquisition governed by the Listing Rules, for the purpose of the direction on falsity, is the Judge required to determine and direct the Jury, as a matter of law, on the meaning of a “connected transaction” and “connected persons” under the Listing Rules?

(2)  Whether it is sufficient to convict the Defendants on the current indictment on the basis of a finding that D1 and D2 had been “working together” in the specified context without examining whether D2 was a “connected person” so as to render the acquisition of a “connected transaction” for the purposes of the Listing Rules?

(3)  When assessing falsity in the context of a charge of conspiracy to defraud alleging specific (false) representations as essential element of the offence (which representations were made by a director under and pursuant to specific Listing Rules requirements in a very substantial acquisitions) must the impugned representations be interpreted as having specific/special meanings in the context of “connected transactions” under the Listing Rules, or can they simply be given an unspecified “ordinary plain meaning?”

3.  On 6 July 2023, counsel for all parties asked this Court to deal with the applications on paper without a hearing.

Background

4.  The questions of law have arisen from my ruling on 13 June 2023 (Reasons for Ruling handed down on 26 June 2023) that the particulars in the current indictment are not limited to the context of the Listing Rules, and the prosecution is not required to prove that the acquisition in question was a “connected transaction” under the Listing Rules (“the First Ruling”).

5.  On 28 June 2023, the Applicants made a joint application for this Court to reserve for the consideration by the Court of Appeal three questions of law pursuant to section 81 of the Criminal Procedure Ordinance, Cap. 221.  The questions of law were identical to the ones set out in the present applications.  I refused the applications on 29 June 2023 with Reasons for Ruling handed down on 10 July 2023 (“the Second Ruling”).

6.  On 30 June 2023, the Applicants lodged intended applications to the Court of Final Appeal (“CFA”) for leave to appeal against the First Ruling by way of Form B.  In refusing to accept the Form Bs for filing, the Registrar of the CFA (“the Registrar”) expressed “serious doubts” as to whether the First Ruling is a final decision within the meaning of s.31(b) of the HKCFAO because it “does not finally dispose of the matter as it is yet to see what evidence will be adduced at trial and what directions will be given to the jury”.  It would appear that the present applications are made pursuant to the comment by the Registrar that “If legal questions are raised, certification is requested from the lower court concerned: s.32(2) of the Ordinance”.[1]

7.  On 3 July 2023, the Applicants lodged two intended summonses to the CFA seeking to re-open the final appeals in FACC 26 & 27/2018.  The intended summonses were not accepted for filing.[2]

The Applicants’ Submission

8.  As to the appropriate test for certification under section 32(2) of the HKCFAO, the Applicants submit that it does not involve the exercise of judicial discretion of the certifying court.  Once the three conditions as confirmed by the Court of Appeal in HKSAR v Kwan Tat Yee[3] are satisfied, namely, a point of law (1) is involved in its decision; (2) is reasonably arguable; and (3) of great and general importance, the certifying court should certify the point(s) of law raised.  Whether the lower court’s decision is a “final decision” under section 31(b) of the HKCFAO is to be determined by the CFA.

9.  The Applicants contend that a refusal to certify the proposed legal questions would be perverse as they satisfy all the Kwan Tat Yee conditions:

(1)  The proposed legal questions are plainly reasonably arguably having already been held so by the CFA in HKSAR v Chen Keen[4] whether in the form of points of law of great and general importance or as points of substantial and grave injustice.  

(2)  The questions are self-evidently of great and general importance in circumstances where the proposed question 1 (and thus the proposed question 3 which is similarly worded) has already been held by the CFA to have such importance.

(3)  The questions have a direct bearing on the true meaning of the indicated particulars of Charges 1 and 3 - which remain (as held by CFA[5]) as constituent elements of the charged conspiracy to defraud.  

10.  The Applicants submit that without a definitive ruling by the CFA as to the true meaning of the indicted particulars, the accused will be substantially deprived of their defences to the indicted conspiracy.

The Respondent’s Submission

11.  The Respondent describes the present applications as the “last ditched attempt” of the Applicants to pursue the issue, noting various unsuccessful applications made by them previously in relation to the same set of questions. On 29 June 2023 this Court refused to reserve the questions for consideration of the Court of Appeal under section 81 of the Criminal Procedure Ordinance.  On 30 June 2023 the Registrar declined to accept the filing of their applications for leave to appeal against the First Ruling, and expressed serious doubts that the said ruling is a final decision within the meaning of section 31(b) of the HKCFAO despite the fact that legal questions seem to have been framed.  On 3 July 2023 the Registrar also refused to accept the filing of their applications to re-open the appeals under FACC 26 & 27/2018, on the ground that the CFA is functus and there is no exceptional ground which warrants the re-opening of the appeals.

12.  Citing HKSAR v Chen Keen (No 2)[6], the Respondent submits that for certification which is intended to facilitate an application for leave to CFA, the ruling has to be a final decision capable of being appealed in the first place before the Court of First Instance can properly certify.  This must follow from the wording of the section because otherwise a trial court could be faced with countless applications on interlocutory rulings.

13.  In the present case, if the Applicants are convicted after trial, they could argue the merits of the Rulings before the Court of Appeal.  On that basis the Rulings would not be a final determination for the purposes of section 31(b) of HKCFAO.  As such this Court is not required to consider whether the proposed questions meet the Kwan Tat Yee requirements.

Discussion

14.  Section 31 and 32 of the HKCFAO provides that:

“31. Criminal Appeals

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—

(a) any final decision of the Court of Appeal;

(b) any final decision of the Court of First Instance (not being a verdict or finding of a jury) from which no appeal lies to the Court of Appeal. (Amended 120 of 1997 s. 11)

32. Leave to appeal

(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 Court of First Instance, 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. (Amended 120 of 1997 s. 12)

(3) Where the Court of Appeal or the Court of First Instance declines to certify as mentioned in subsection (2), the Court may so certify and grant leave to appeal. (Amended 120 of 1997 s. 12)

(4) The Court may when granting leave under subsection (1) impose a timetable on any party for the prosecution of the appeal and may either on the application of a party or of its own motion vary that timetable.”

15.  Section 31 sets out the CFA’s jurisdiction to hear criminal appeals and section 32 sets out the procedural requirement.  The two sections should be read in conjunction with each other.  As such the decision involved has to be a final decision from which no appeal lies to the Court of Appeal.

16.  As Ribeiro PJ said in the case of Pasa Danaville Dizon v HKSAR:[7]

“… Under section 31 of the Court’s statute, the Court has a discretion to grant leave to appeal only from any final decision of the Court of First Instance from which no appeal lies to the Court of Appeal. A final decision in that context must mean the lower court’s substantive decision disposing one way or another of the offence charged. …”

17.  And echoed by Lam PJ noted in HKSAR v Chen Keen (No 2)[8]:

“As the applications were made in respect of the decision of a judge of the Court of First Instance in a criminal cause or matter, this Court’s jurisdiction is circumscribed by Section 31(b) of the Hong Kong Court of Final Appeal Ordinance (Cap. 484) (“HKCFAO”).  Under that sub-section, this Court may only entertain an appeal in a criminal cause or matter from a final decision of the Court of First Instance (not being a verdict or finding of a jury) from which no appeal lies to the Court of Appeal.”

18.  The Rulings given in this case cannot be said to be final decisions from which no appeal lies to the Court of Appeal.  The merits of the rulings can be subject to potential review by the Court of Appeal if the Applicants were eventually convicted.  Given that the rulings cannot be regarded as “final decisions” it would not be appropriate for me to grant the section 32(2) certificate.

Conclusion

19.  For the above reasons, the applications are refused.

Postscript

20.  These reasons are provided for the parties’ information only.  The only part of this judgment which may be reported publicly are the above Conclusion.  The remaining part of this judgment may not be reported until further order or until the conclusion of the trial.

[Subject to Reporting Restrictions as per Paragraph 21 of this judgment]