HKSAR v. PANG HUNG FAI

FACC No. 8 of 2013

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 8 OF 2013 (CRIMINAL)

(ON APPEAL FROM CACC NO. 34 OF 2012)

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JUDGMENT ON COSTS

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The Court :

1. On 10 November 2014, the Court gave judgment allowing the appellant’s appeal and quashing his conviction for an offence under sections 25(1) and (3) of the Organized and Serious Crimes Ordinance[1]. In doing so, the Court also made an order nisi as to costs on the following terms:

“…that the appellant be paid the costs of and occasioned by the appeal to the Court of Appeal and to this Court with liberty to the parties, if so advised, to lodge with the Registrar written submissions as to costs within 14 days from the date of this judgment and direct that in default of such submissions, that the order nisi do stand as an order absolute without further direction.”[2]

2. Pursuant to the liberty so granted, the appellant has now filed written submissions applying to vary the costs order nisi to include (i) an order that he be paid the costs of and occasioned by the trial in the District Court[3] with a certificate for two counsel and (ii) for certificates for three counsel for the appeals to the Court of Appeal[4] and to this Court.  The respondent has, for its part, filed written submissions in reply resisting the appellant’s variation application.

The costs of trial

3. It is well-established that, as a general rule, costs follow the event of an acquittal.  The appellant prays in aid this rule in support of his variation application in respect of the costs of the trial in the District Court.

4. The general rule may, however, be departed from where there is a positive reason to do so, such as where the appellant’s own conduct has brought suspicion on himself or has misled the prosecution into thinking the case against him is stronger than it is.[5] The respondent, in resisting the variation application, contends that the appellant plainly brought suspicion on himself in the present case.

5. In the Court’s view, the present case is one in which the appellant should be deprived of his costs of the trial in the District Court because he brought suspicion on himself.

6. The facts giving rise to the charge against the appellant are summarised in paragraphs 13 to 16 of the Court’s judgment and the list of factors relied on by the respondent for the assertion that the appellant had reasonable grounds to believe that the property with which he dealt represented the proceeds of an indictable offence set out in paragraph 23 of the Court’s judgment. 

7. Although the Court concluded that the trial judge and Court of Appeal had erred in holding that it was impermissible to take into account the appellant’s perception and evaluation of the objective facts relating to the appellant’s dealing with the property and known by him to exist as constituting or contributing to reasonable grounds for believing that the property did not represent proceeds of an indictable offence[6], the Court also concluded that the list of factors relied on by the respondent “could be sufficient to support the requisite inference”[7] that he had reasonable grounds to believe that the property with which he dealt represented the proceeds of an indictable offence.

8. The Court went on to observe:

“Indeed, the fact that the Appellant was offered no explanation, and made no enquiry, as to why Kwok could not use one of his own accounts could form the basis of an ‘irresistible inference’ that something untoward was going on, which required Kwok to hide the flow of funds. However, it is not so apparent that what was untoward involved proceeds of an indictable offence.”[8]

9. Whilst that observation was made in the context of considering whether to order a re-trial, it supports the respondent’s submission that the circumstances of the case were such that the appellant had at least invited suspicion as to whether he had the requisite reasonable grounds to believe that the property with which he dealt represented the proceeds of an indictable offence. That the Court concluded that it was not inevitable that a conviction would follow was simply a factor in the decision not to order a re-trial.

Certificates for three counsel before the Court of Appeal and in this Court

10. In respect of the appeal against conviction in the Court of Appeal and the appeal in this Court, the appellant engaged four counsel and the respondent engaged three counsel.

11. In respect of the costs of engaging counsel, the normal rule is that, subject to the reasonableness of the fees paid, the Registrar will allow the costs incurred by a party who has employed two counsel in the Court of Final Appeal[9] and a party who wishes to recover the costs of more than two counsel in this Court should ask the Court to certify to this effect.[10]

12. As the Court has previously held, a case in the Court of Final Appeal is almost always bound to involve some considerable importance and difficulty so that certifying a case as fit for more than two counsel requires “something exceptional”.  Further, the employment of three counsel by the paying party may or may not get the party home on the argument that the case was exceptional.[11]

13. It was submitted on behalf of the appellant that the legal issues involved were of “unprecedented difficulty and complexity”.  Reference was also made to the observations of Tang VP (as he then was) when granting the appellant bail pending appeal to the Court of Appeal welcoming the indication that leading counsel from London would be engaged for the appeal.[12] It was also pointed out that the applications for ad hoc admissions of, first, Ms Clare Montgomery QC, and, subsequently, Lord MacDonald QC[13], proceeded with the consent of the Bar Association and the Secretary for Justice.

14. Although the questions of law raised in the appeal were self-evidently important, we do not consider that the case was of the “unprecedented” difficulty or complexity as submitted on behalf of the appellant.  The case involved only one defendant facing one charge, the factual background to which was relatively straightforward. The length of the hearing of the appeals was not exceptional: that in the Court of Appeal occupied two hearing days whilst that in this Court occupied only one day.  The appearance of London counsel admitted on an ad hoc basis does not affect this conclusion: even if that admission is on the basis that local leading counsel is also engaged, it does not require the engagement of more than two counsel (since the two-counsel rule has long been abolished in this jurisdiction).

15. In the circumstances, we are not satisfied that this was a case of such an exceptional nature to warrant the engagement of more than two counsel on behalf of the appellant in the Court of Appeal or this Court.

Conclusion

16. For these reasons, we dismiss the appellant’s application to vary the costs order nisi which is now made absolute.