RE KOON WING YEE

   HCAL 134/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO 134 OF 2008

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J U D G M E N T

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1. By a notice dated 17 October 2008 and issued under s 183 of the Securities and Futures Ordinance (Cap 571), the applicant is required by an investigator appointed under s 182(1) of the Ordinance on the same day to attend an interview on 3 November 2008 and to answer any questions that the investigator might raise with the applicant in connection with certain suspected market misconducts or offences under ss 274, 275, 278, 295, 296 and 299 of the Ordinance which are matters under investigation.

2. The applicant says that the notice would lead to an infringement of his right to a fair hearing before the Market Misconduct Tribunal established under Part XIII of the Ordinance, as protected by art 10 of the Hong Kong Bill of Rights.  The applicant contends that art 10, when being applied to the inquiry by the Tribunal, guarantees the subject of the inquiry equality of arms and the right against self-incrimination.  Ss 183 and 184 of the Ordinance, it is pointed out, give power to the Securities and Futures Commission to compel answers from the interviewee, and s 253 of the Ordinance provides that such answers will be admissible in evidence before the Tribunal.  The applicant, therefore, contends that the current scheme as provided in the Ordinance which provides no safeguard to the equality of arms and the right against self-incrimination, is inconsistent with art 10 of the Hong Kong Bill of Rights.  The only remedy, it is contended, under the current scheme is to quash the notice so as to safeguard the applicant’s right against self-incrimination and the equality of arms before the Tribunal.  The applicant therefore seeks leave to launch judicial review proceedings to challenge the notice.

3. Save for a passing reference to the decision of the Court of Appeal in CACV 369/2007 and the application for leave to appeal to the Court of Final Appeal in FAMV 53/2008 and save for the general assertion that the grounds of appeal in those appellate proceedings are different from the grounds relied on in the present application (para 4 of the applicant’s supporting affirmation), there are no other references to, let alone discussion on, the decision of the Court of Appeal in CACV 369/2007 (on appeal from HCAL 7/2007) or the implications of the decisions in those proceedings on the present application, in the papers filed.  Although the Form 86A is not signed by counsel, counsel admits to the Court at the hearing that he has been aware of those decisions but that notwithstanding, they have not been mentioned at all in his written skeleton or included in his list of authorities.  Counsel says they are distinguishable decisions, but I simply fail to see how counsel can even begin to distinguish decisions at a hearing when they are not even cited to the Court in the first place, particularly when the hearing is an ex parte one.  The importance of citing all relevant decisions to the Court at a hearing, whether they are for or against one’s case, and regardless of whether they are thought to be distinguishable or not, cannot be over-emphasised.  This is particularly so in an ex parte hearing where the Court does not have the benefit of hearing the other party to the litigation.

4. HCAL 7/2007 was also taken out by the applicant.  It was a challenge against the issue of another notice, dated 28 December 2006, under s 183(1) of the Ordinance, to attend an interview on 8 January 2007.  The notice had been issued by an investigator under s 182(1) to investigate matters relating to false trading, price rigging and/or stock market manipulation that may have occurred during or around the period from 26 August 2004 to 5 November 2004 in relation to dealing in certain shares.  One of the grounds relied on by the applicant to challenge the 2006 notice was that attending the interview required by the notice would lead to the removal of the right to silence and thus a breach of art 11(2)(g) of the Bill of Rights in relation to proceedings before the Market Misconduct Tribunal.  That contention was met with the argument that the challenge was premature, primarily because there were no Market Misconduct Tribunal proceedings then on foot and there might never be any.

5. This argument found favour with Saunders J who heard the challenge and handed down his judgment on 2 November 2007.  His view was summarised by the Court of Appeal in para 11 of its Reasons for Judgment handed down on 3 September 2008 in CACV 369/2007 as follows :

“The judge accepted that there were many possible outcomes to an investigation by the investigators of the Securities and Futures Commission (“SFC”).  Amongst those alternatives, which are set out in paragraph 9 of his judgment, are that there might be no proceedings brought before the Market Misconduct Tribunal or proceedings might be brought against persons other than the applicant.  The judge held, on authority, that there was nothing in the Bill of Rights which gave a person protection from legislation requiring him, on pain of penalty, to answer questions put by an investigating authority.  What the Bill of Rights did was to give a person protection from his answers being used in criminal proceedings against him or from being compelled to give evidence in criminal proceedings against himself.  As the judge pointed out, the applicant was not subject to a criminal charge or proceedings in the Market Misconduct Tribunal, at any rate at present.”

6. The judge’s decision was upheld on appeal.  In para 13 of the Reasons for Judgment, Rogers VP explained :

“In my view, the judge was correct in his conclusion that the application for judicial review, even on the basis on which it was ultimately presented, was premature and hypothetical.  The SFC was using its statutory powers to conduct an investigation and that it was perfectly entitled to do.  If and when any attempt were made to use material in a manner which the applicant considered would be in breach of the Bill of Rights, then that would be the time when some objection could be taken.  Likewise, if it were considered that any future proceedings before the Market Misconduct Tribunal were criminal in nature by reason of the orders that could be made and that the proper safeguards for those subject to such proceedings were not in place, then, again, appropriate proceedings might be taken.  But that is not the case here.  It is no exaggeration to say that if the SFC were to be prevented from asking questions of the applicant, its role in an investigation might be stultified.”

7. On 17 October 2008, the Court of Appeal refused the applicant’s application for leave to appeal to the Court of Final Appeal.  The applicant’s application to the Court of Final Appeal itself for leave to appeal is yet to be heard: FAMV 53/2008.

8. It is regrettable that the applicant has not seen fit to draw the Court’s specific attention to and discuss the important and highly relevant decisions of Saunders J and the Court of Appeal in HCAL 7/2007 and CACV 369/2007 in the papers filed in the present application, particularly when the applicant was himself the applicant in those proceedings.

9. In my view, the Court of Appeal’s decision in CACV 369/2007 is conclusive of the present application.  There are no Market Misconduct Tribunal proceedings on foot and there might never be any.  Art 10 of the Bill of Rights is only engaged when there is a hearing before a court or a tribunal of a person’s rights and obligations in a suit at law – the applicant being content, in the present application, to proceed on the basis that proceedings before the Market Misconduct Tribunal are civil in nature.  If and when there were proceedings before the Market Misconduct Tribunal and if and when an attempt were made to use material obtained in the interview required by the notice in a manner which the applicant considered would be in breach of his right provided by art 10 of the Bill of Rights, then that would be the time when some objection could be taken.  As Rogers VP has observed, it is no exaggeration to say that if the Securities and Futures Commission were to be prevented from asking questions of the applicant at this stage of investigation, for fear of infringing his right to a fair hearing in future Tribunal proceedings (if there were to be any), its role in an investigation might be stultified. 

10. Certainly there are superficial differences between the present case and the case involving the 2006 notice.  In the latter case, the proceedings before the Market Misconduct Tribunal were thought to be criminal in nature and art 11 of the Bill of Rights (which deals with rights of persons charged with or convicted of criminal offences) was relied on.  In the present case, the applicant is content to proceed on the assumption that the proceedings before the Tribunal are civil in nature, and he seeks protection under art 10 of the Bill of Rights, which provides that everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law.

11. All these are immaterial differences.  As a matter of substance, what is sought to be protected here is the right against self-incrimination and equality of arms, which are said to be covered by the right to a fair hearing.  However, until proceedings before the Tribunal are on foot, any such rights are not engaged.  The present application is simply indistinguishable from the Court of Appeal’s decision and must be rejected for being premature.

12. The fact that the applicant is currently seeking leave from the Court of Final Appeal to appeal from the Court of Appeal’s decision is neither here nor there.  This Court is bound by the decision of the Court of Appeal. 

13. The application is dismissed with no order as to costs.