RE LI MAN TAK AND OTHERS

DCCC689/2004

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CRIMINAL CASE NO. 689 OF 2004

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1.  This is the fifth application in the trial by D1, Li Man-tak, Michael, and is for a permanent stay of proceedings.

BACKGROUND TO THIS APPLICATION

2.  I have already given my ruling on the admissibility of two sets of tapes derived from the covert installation of “bugging” devices at meetings between co-conspirators at the Langham Hotel and the Hunan Garden Restaurant.  However, in the course of the voir dire leading up to that ruling Mr Tony Lui, principal investigator of the ICAC, revealed that the intelligence information leading up to the decision to “bug” those two meetings came from earlier telephone interceptions (TI) between alleged co-conspirators.  This “intelligence information” (in a 27 page document bearing that title and marked “Confidential”, Exhibit PP137) had already been supplied to the defence as part of the unused material on 10 March 2005.  At no stage has the prosecution sought to adduce any of this intelligence information into evidence at this trial. 

3.  However, it is a practice of the ICAC to record all information gleaned from telephone tapping in a neutral manner so that the source of this information will not be revealed.  Accordingly, the defence did not know the source of PP137 until it was revealed by Mr Lui in court.  Immediately, by letter dated 12 April 2005, D1’s solicitors, Messrs Tai, Mak & Partners, wrote to the prosecutor, Mr Fitzpatrick, seeking “copies of all audio and video recordings made and any consequent notes or reports concerning them.”  By faxed reply dated 13 April, Mr Bernard Ryan, Senior Assistant DPP, pointed out that the recordings in question were telephone interceptions, “lawfully conducted in accordance with the provisions of the Telecommunications Ordinance.”  Mr Ryan added,

“The product of this interception was preserved only for as long as was necessary to assist the investigation. As the product was not to be used in evidence, it was destroyed in order to protect the privacy rights of those affected by the interception. Consequently, there are no audio or video recordings or reports. The useful intelligence obtained from the interception was, on occasion, reduced to a note and these were subsequently compiled into a document entitled ‘Intelligence Information’.”

4.  In further correspondence between the two sides it was revealed by the prosecution that these telephone taps were made pursuant to section 33 of the Telecommunications Ordinance, Cap.106, and Mr Ryan added in his letter of 15 April:

“As I have already indicated to you in my letter of 13 April, the product of these interceptions, including any notes made from the product, are destroyed in order to protect the privacy rights of those affected by them. Pursuant to this policy, the only existing record of the contents of the intercepted communications is in the document entitled ‘Intelligence Information’, which has already been disclosed to you. Beyond what is evident from that document, no further details of the intercepted communications are still available. As can be seen from that document, the interceptions involved defendants and witnesses.”

5.  Further, Mr Ryan added that any written Orders made by the Chief Executive under section 33 had themselves been destroyed to protect confidentiality/privacy.  In further correspondence dated 19 April 2005, Mr Ryan pointed out as follows:

“	(2)	When carrying out our Common Law Disclosure obligation we apply the relevancy test as laid down by the Court of Final Appeal in HKSAR v Lee Ming-Tee & Anor [2003] 6 HKCFAR 336. In relation to telephone interception, two types of material are involved. They are:
		(a)	the information derived from the intercept; and
		(b)	the fact that that information came from an intercept.
		In the present case (a) was disclosed but not (b). The reason why (b) was not disclosed was because the fact that the (a) information came from an intercept could not be seen on a sensible appraisal to fall within the parameters of the relevancy test.
	(3)	As you are aware, telephone interception is a highly intrusive investigative technique in its impact upon the privacy rights of individuals. The individuals affected by it are not just suspects in an investigation but any person communicating with that suspect through a telephone that is being intercepted. Unavoidably the personal data of persons other than a suspect may inadvertently be collected. To meet these concerns and consistent with the principles of the Personal Data (Privacy) Ordinance, Cap.486, the product of the telephone interceptions was destroyed.”

6.  The defence team for D1 is not satisfied with that response as their research has apparently revealed that on some occasions the ICAC intercepted and recorded phone calls but decided not to transcribe the results so that any information that might have been gleaned from these “missing tapes” did not end up in the Intelligence Information (PP137).  Accordingly, they speculate that there might have been useful information on the missing tapes with which to cross-examine Mr Vincent Yum, the principle witness in this trial. 

7.  The defence further complains that the prosecution has failed in its duty of full disclosure of all relevant material.  Mr Cheng Huan’s lengthy written submissions have been summarised by the prosecution as follows:

SUMMARY OF D1’s STAY APPLICATION.
	(i)	The ICAC have collected evidence through telephone intercepts;
	(ii)	selected useful portions and made notes thereon;
	(iii)	destroyed the original evidence, thereby preventing,
		(a)	the court and the defence from assessing the potential importance of any missing information and its impact on the defence case and,
		(b)	the defence from examining the primary source material.
(2)	The prosecution have:
	(i)	failed to reveal the existence of the intercepts and,
	(ii)	compounded their fault by destroying the material before its existence could be discovered, thereby preventing its consideration by the defence or the court.
(3)	It is clear that:
	(i)	material relevant to the cross-examination of Vincent Yum that should have been disclosed was destroyed and its existence concealed and,
	(ii)	the material destroyed must have included Vincent Yum and the defendant speaking together and to others.
(5)	The ICAC’s actions tends to suggest a deliberate attempt to conceal the fact that these intercepts took place.
(6)	Further, the prosecuting authority have chosen to make secret rules for the destruction of disclosable material which provide no remedy for a defendant and offer no protection against abuse and arbitrariness. They have thereby manipulated the system to deny the defendant the safeguards to which he is entitled.

8.  I ruled that there should be a voir dire on this issue.

EVIDENCE IN THE VOIR DIRE

9.  Two officers of the ICAC testified in camera last Thursday.  The first was Mr Gilbert Chan, a director of the ICAC, who testified along the lines of his witness statement dated 27 April 2005.  He testified that one of his responsibilities is to supervise the implementation of telephone intercepts authorised by the Chief Executive of the Hong Kong SAR under section 33 of the Telecommunications Ordinance.  The procedure is that an officer not below the rank of Principle Investigator prepares an application for a TI in the form of a report (known as a “Justification”).  This is then submitted to a Head of Operations, who must satisfy himself that the interception is necessary for the prevention or detection of serious crime, including serious corruption offences.  If Head of Operations is satisfied with the Justification, he will sign an application to the Chief Executive.

“Once the Chief Executive has approved and issued a Warrant (the Warrant has a specified timeframe we were told in camera), arrangements will be made to carry out TI. Any intelligence collected from TI will, as soon as practicable, be reduced by transcribing officers into a transcript for the Chief Investigator in charge of the investigation to read. The transcript is usually in paraphrase and relates to the contents of telecommunications between the subject and other persons. The transcript, however, excludes any information unrelated to the investigation or unconnected with crimes. The Chief Investigator is allowed to record information contained in the transcript that he assesses will be relevant to his investigation in a summary known as the ‘Intelligence Information’. Such records are retained by him for the purposes of the investigation. These records are not automatically destroyed and, should a prosecution result from the investigation, they will be disclosed as part of the unused materials.

In June 1999, after consultation with the Security Bureau on the policy relating to TI and in order to implement that policy, Head of Operations instituted a set of practices to regulate the destruction of TI products. Their destruction policy was that all materials and records generated in the process of recording and transcribing the product of an individual TI should be erased/destroyed and the practices implementing that policy are as indicated below.”

10.  Mr Chan sets out in his witness statement the destruction policy timeframes for material such as:

(a)	recording media;
(b)	transcripts;
(c)	intelligence summary;
(d)	justifications;
(e)	warrants.

I see no need to repeat save in open court.

11.  In testimony, Mr Chan confirmed that there are two unique features to this form of intelligence gathering, i.e.:

(a)	the non-evidential use of the product of TI and,
(b)	the destruction of all such product immediately it is no longer needed for operational purposes.

12.  He further testified that there is a clear and distinct separation within the ICAC between its surveillance and its investigatory branches and he outlined how each branch carries out its functions.  In brief, the Chief Investigator of any given operation will brief the transcribers of the Investigation Branch on what to look out for and what to transcribe when they listen to the recordings of intercepted communications.

13.  There is a deliberate policy in place to preserve confidentiality of TI.  For instance, the office of the Chief Executive returns all application information along with the signed Warrants and does not keep copies of any such documents.  Ultimately, once the ICAC have destroyed the documents referred to above within the said timeframes, no record of same will be in existence.

14.  Chief Investigators who prepare the intelligence information are given clear instructions that their record must not identify or give any information that might identify TI as the source of the material.  Accordingly, whenever such intelligence information makes its way onto the unused material (as happened in the present case), there should be nothing on its face to indicate how it was obtained.

15.  In cross-examination, Mr Chan confirmed that he was one of the categories of “public officer” referred to at section 33 of the Telecommunications Ordinance.  He conceded that this destruction policy was not specifically provided for in section 33 and, indeed, it had no legislative backing.  He further conceded that the transcribers of the tapes would not have a clear picture at such an early stage as to who might eventually be charged and who might be given immunity, the extent of the corruption under investigation and whether a prosecution might necessarily follow, or what the defence to that prosecution might eventually be.

16.  Mr Patrick Ho (PW5) was the Chief Investigator who prepared the intelligence information in question.  Again, he adopted his witness statement dated 27 April.  This confirmed how he approached the task of preparing the “intelligence” information in the present case.  In prior briefings of the transcribers of the Surveillance Branch, Mr Ho had told them to record all material relevant to the investigation, both inculpatory and exculpatory.  Mr Ho testified in court that Vincent Yum, the proposed witness under immunity in the general issues, was a target person throughout this investigation in respect of whom the transcribers were to record all relevant information.  Having confirmed that his intelligence information was never intended to be used in evidence in any subsequent prosecution, this witness commented that, “The limitation of telephone interceptions is that we cannot identify the voices.”

17.  Finally, Mr Ho told the court that all TI’s are considered “Top Secret” documents by the ICAC and he endeavours to ensure that their source is never revealed. 

18.  That was the gist of the evidence in camera.

THE LAW ON DISCLOSURE

19.  It has been recognised for many years in the Common Law that the prosecution is obliged to make available to the defence materials not led in evidence by them which may assist the accused.  In the earlier cases the duty was narrowly put, but more recent authorities have greatly expanded the scope of the prosecutor’s duty.  The history of this area of the Common Law is given in R v Ward [1993] 1 WLR 619 and is also fully rehearsed in R v Keane [1999] 1 WLR 746.

20.  A useful summary of the duty is to be found in R v Brown [1998] AC 377, where Lord Hope declared as follows:

“The prosecution is not obliged to lead evidence which may undermine the Crown case but fairness requires that material in its possession which may undermine the Crown case is disclosed to the defence. The investigation process will also require an inquiry into material which may affect the credibility of potential Crown witnesses. Here, again, the prosecution is not obliged to lead the evidence of witnesses who are likely in its opinion to be regarded by the judge or jury as incredible or unreliable. Yet fairness requires that material in its possession which may cast doubt on the credibility or reliability of those witnesses whom it chooses to lead must be disclosed. The question whether one or more of the Crown witnesses is credible or reliable is frequently one of the most important ‘issues’ in the case, although the material which bears upon it may be, as Steyn LJ observed in R v Ward, collateral.”

21.  In the Hong Kong Court of Appeal, the scope of the prosecutor’s duty of disclosure was considered in relation to 10 CCTV videotapes of transactions in a mobile phone shop, whose existence only came to light at the end of the trial when the judge in the case under appeal was asked to make a Disposal of Exhibits Order.  In HKSAR v Lau Ngai Chu [2002] 2 HKC 591, Lugar-Mawson J held, inter alia,

“The prosecution’s duty at Common Law was to ensure that all relevant evidence of help to the accused was made available to the defence. This included those that would enable the accused to have the opportunity of considering all the material evidence which the prosecution had gathered. The tapes in question were relevant, or possibly relevant, to an issue in the case or held out a real prospect of providing a lead on evidence going to such issue and, regardless of what view the prosecution had of their quality, the tapes should be disclosed and made available to the defence.”

22.  So the four broad questions I now have to ask myself are:

THE ISSUES
1.	Are telephone intercepts disclosable evidence?
(and, if the answer is “Yes”),
2.	Has the prosecution performed its duty of disclosure in respect thereof?
3.	If not, should I conclude that the defendant cannot now receive a fair trial?
And/or,
4.	Should I now conclude that in all the circumstances that have occurred it would be unfair for the defendant to be tried?

23.  1.  Are telephone intercepts disclosable evidence?

24.  Mr Cheng has taken the court through some 20 English and Hong Kong authorities in this area of law, but the very last case he opened, late in the day and rather gingerly, was the only one directly on point.  The House of Lords in R v Preston & Others [1994] 2 AC 130 considered the whole question of telephone tapping by an investigatory authority, its subsequent destruction, whether the prosecution was under any duty to disclose those facts to the defence, and whether any lack of disclosure of same was a material irregularity in the course of the trial.  This case is of particular importance because the Law Lords considered these issues in light of the recent broadening of disclosure requirements culminating in Ward’s case (Supra).

25.  Mr Cheng has sought to distinguish our present case from Preston because the English case was decided against the backdrop of the Interception of Communications Act 1985, which sets out a clear statutory framework within which telephone tapping can take place and provides a form of redress for any person who believes his telephone has been wrongly tapped.

26.  It is true that we have no such statutory regulatory framework in Hong Kong but a salient and vital feature of both systems is that the product of telephone tapping is not used in evidence in any subsequent criminal prosecution.  This brings telephone tapping into very different considerations from, for example, covert surveillance by means of “bugging” devices.  The 1985 Act expressly precludes the use of such material in legal proceedings.  In Hong Kong there is no such statutory prohibition, save insofar as section 33 of the Telecommunications Ordinance does not empower the fruits of telephone interception to be used in evidence.  Indeed, were the shoe on the other foot and if the prosecution had in fact sought to introduce such material into this trial, I have no doubt but that Mr Cheng would have sought exclusion for that very reason.

27.  Further, as we have seen, there is also a well-settled practice of destruction in the ICAC, which of itself precludes the use of such material in evidence.

28.  Accordingly, I find that the English and Hong Kong authorities both approach this issue in the manner anticipated by the Home Office White Paper that preceded the 1985 Act in England:

“By making such material generally inadmissible in legal proceedings, it will ensure that interception can only be used as an aspect of investigation, not of prosecution.”

29.  By contrast, the as yet un-enacted 1996 Interception of Communications Ordinance in Hong Kong is irrelevant to the present case as its safeguards are mainly designed to enable intercepted communications to be used in evidence.

30.  In Preston, Lord Mustill attempts to reconcile the various tensions that can arise between those parts of the state that wish to use intercepts for the common good, such as to detect crime, and those who are concerned with the protection of the individual’s right of privacy.  There are subsequent tensions that arise where an interception has yielded information that, directly or indirectly, leads to a prosecution, as:

“Those who perform the interceptions wish to minimise the dissemination of the fact that they have been performed since it is believed that this would diminish the value of activities which are, by their nature, clandestine.”

31.  Lord Mustill comments further (at page 146H):

“Recent developments on the law and practice regarding disclosure by the prosecution of ‘unused materials’ have also created tensions within the criminal process”, before turning to what he describes as “the specialist area of telecommunications intercepts”.

32.  After Lord Mustill had referred to the many reports that led up to the 1985 Act in England, he then commented at page 147E:

“Each of these documents treats as established beyond doubt both the practical justification and the legality of interception. Equally, they all recognise the conflict between the need for the state to pry into the private dealings of the individual and the right of the individual to keep them private and acknowledge the importance that this intrusion should be kept to an absolute minimum and that the fruits of the interception should be retained only for so long as is necessary to achieve the purpose for which the interception was authorised. The reports, and others, also make clear that although there has been some disagreement about whether the intercept material is in principle capable of being used in court, all were agreed that in practice such material is never so employed.”

33.  The rest of Lord Mustill’s judgment and his findings have been succinctly summarised by the editors of the report in the “Holding” section No. 2 as follows:

“But, (2) dismissing the appeals, that the power of the Secretary of State to issue a warrant under section 2(2)(b) of the Act ‘for the purpose of preventing or detecting serious crime’ did not extend to the amassing of evidence with a view to the prosecution of offenders; that the investigating authority were therefore under a duty under section 6 of the Act to destroy all material obtained by means of an interception as soon as its retention was no longer necessary for the prevention or detection of serious crime and they did not have to retain the material until trial for disclosure to the defence; that although the policy underlying sections 2 and 6 was in contradiction to the duty to give complete disclosure of unused materials, the intent of the Act to keep surveillance secret and to give the maximum privacy to those whose conversations had been overheard prevailed; and that, therefore, the destruction of the documents obtained from the interception and their consequent unavailability for disclosure could not be relied upon by the defendants as a material irregularity in the course of their trial.”

34.  Turning back to the destruction policy as operated generally by the ICAC, I am bound to say that if we are to have such a “necessary evil” as telephone intercepts, it is right and proper that the fruit of the interceptions should be retained only for so long as is necessary to achieve the purpose for which it was authorised.  Were it otherwise, it would be disquieting to contemplate a vast land bank of intercepted telecommunications going back over many years in the hands of a single authority.

35.  Looking at the destruction policy in the context of this particular application, I find as follows:

(1)	The power of the Chief Executive to issue a warrant for telecommunications intercepts under section 33 does not extend to the amassing of evidence with a view to the prosecution of offenders,
(2)	the ICAC were under no obligation to retain the material in question until trial for disclosure to the defence and,
(3)	as there was no duty of disclosure, the destruction of the original tapes and their consequent unavailability for disclosure cannot be regarded as “a material irregularity” that should cause me to intervene and stop this trial.

36.  Accordingly, under this heading, this challenge from the 1st defendant fails.

37.  The Remaining Issues. 

38.  If however, I am wrong in my view of the law of disclosure as it particularly applies to telephone intercepts, I turn to the facts of the present case to see if,

(1)	the defendant can still get a fair trial without such disclosure, and/or
(2)	it would now be unfair to try the defendant in all the circumstances that have emerged.

39.  Mr Cheng has claimed in effect that the missing tapes must contain or even might contain a mass of information on Vincent Yum and the conspiracy that could enable him to more effectively cross-examine the main prosecution witness.

40.  With respect, this submission ignores a number of salient features about this surveillance:

(a)	The transcribers were briefed to look out for and record all material, inculpatory or exculpatory, touching upon the involvement of each alleged conspirator, including Vincent Yum.
(b)	Mr Patrick Ho then went looking for such relevant material and reduced it to the intelligence information.
(c)	That intelligence information contains a mass of relevant information, running to 194 paragraphs, and has been in the possession of the defence lawyers since early March 2005.

41.  To look at the same situation from another angle, I ask myself, how likely is it that highly trained and professional officers would simply ignore and fail to transcribe relevant material when dealing with these tapes?

42.  I bear in mind the test for disclosure as set out in R v Keane: 

“	I would judge to be material in the realm of disclosure that which can be seen on a sensible appraisal by the prosecution:
	(1)	To be relevant or possibly relevant to an issue in the case.
	(2)	To raise or possibly raise a new issue whose existence is not apparent from the evidence the prosecution proposes to use.
	(3)	To hold out a real (as opposed to fanciful) prospect of providing a lead on evidence which goes to (1) or (2).”

43.  In commenting on Keane in HKSAR v Oh Eugene Jae-Hoon, (HCMA 369 of 2002) McMahon DJ (as he then was) stated: 

“Even if there is non-disclosure of the sort that breaches the rule in Keane’s case, that is not the end of the matter. Before that non-disclosure has the effect of rendering a conviction defective in any way, there must be something to suggest the non-disclosure was in fact material in the sense that the non-disclosure may in some practical way have prejudiced the conduct of the defence.”

44.  There has not been any evidence in this case, or indeed any submission, to show how non-disclosure may in some practical way have prejudiced the defence of D1.

45.  It is worth bearing in mind the comments of Lord Jauncey of Tullichettle in R v Preston at page 144: 

“The defendants argued strenuously that failure to disclose intercepted material could result in prejudice to the defendants. In my view, any prejudice which might result to the defence must be far outweighed by the inability of the prosecution to make use of incriminating material gleaned from an interception. It is likely that in a great majority of cases in which a prosecution follows telephone tapping, the material of the intercept will incriminate rather than exculpate one or other of the parties to the intercepted conversation and would be of assistance to the prosecution if it were available in evidence.”

46.  I find that the defence assertion that there may have been relevant material on the missing tapes to be not only speculative but fanciful.  Accordingly, no possible prejudice has been shown to enable me to find, on a balance of probabilities, that a fair trial is no longer possible.

47.  Finally, we come to the residual power to impose a stay where the circumstances involve an abuse of process which so offends the court’s sense of justice and propriety that the entire prosecution is tainted.

48.  As I have already indicated, the policy of destruction within a specified timeframe as practised by the ICAC is found to be a rational and fair balance between gathering intelligence to fight crime and to giving maximum privacy to those whose conversations have been recorded.  They cannot now be expected to hand over what has already been destroyed under such a policy, particularly as it was never intended to be used in evidence.  I find the ICAC have not acted in bad faith in this instance.

49.  I see no merit whatsoever in this aspect of the defendant’s application.  Accordingly, I find against D1 under all headings of the issues before me and I refuse his stay application.