HKSAR v. YUONG HO-CHEUNG

HCMA 381-399, 401-402, 404-405 & 415/2018 (Consolidated)

[2019] HKCFI 2899

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO 381 OF 2018

(ON APPEAL FROM KCCC NO 3412 OF 2017)

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MAGISTRACY APPEAL NO 382 OF 2018

(ON APPEAL FROM KCCC NO 3413 OF 2017)

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MAGISTRACY APPEAL NO 383 OF 2018

(ON APPEAL FROM KCCC NO 3414 OF 2017)

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MAGISTRACY APPEAL NO 384 OF 2018

(ON APPEAL FROM KCCC NO 3415 OF 2017)

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MAGISTRACY APPEAL NO 385 OF 2018

(ON APPEAL FROM KCCC NO 3416 OF 2017)

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MAGISTRACY APPEAL NO 386 OF 2018

(ON APPEAL FROM KCCC NO 3417 OF 2017)

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MAGISTRACY APPEAL NO 387 OF 2018

(ON APPEAL FROM KCCC NO 3418 OF 2017)

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MAGISTRACY APPEAL NO 388 OF 2018

(ON APPEAL FROM KCCC NO 3419 OF 2017)

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MAGISTRACY APPEAL NO 389 OF 2018

(ON APPEAL FROM KCCC NO 3420 OF 2017)

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MAGISTRACY APPEAL NO 390 OF 2018

(ON APPEAL FROM KCCC NO 3421 OF 2017)

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MAGISTRACY APPEAL NO 391 OF 2018

(ON APPEAL FROM KCCC NO 3422 OF 2017)

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MAGISTRACY APPEAL NO 392 OF 2018

(ON APPEAL FROM KCCC NO 3423 OF 2017)

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MAGISTRACY APPEAL NO 393 OF 2018

(ON APPEAL FROM KCCC NO 3424 OF 2017)

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MAGISTRACY APPEAL NO 394 OF 2018

(ON APPEAL FROM KCCC NO 3425 OF 2017)

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MAGISTRACY APPEAL NO 395 OF 2018

(ON APPEAL FROM KCCC NO 3426 OF 2017)

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MAGISTRACY APPEAL NO 396 OF 2018

(ON APPEAL FROM KCCC NO 3427 OF 2017)

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MAGISTRACY APPEAL NO 397 OF 2018

(ON APPEAL FROM KCCC NO 3428 OF 2017)

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MAGISTRACY APPEAL NO 398 OF 2018

(ON APPEAL FROM KCCC NO 3429 OF 2017)

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MAGISTRACY APPEAL NO 399 OF 2018

(ON APPEAL FROM KCCC NO 3430 OF 2017)

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MAGISTRACY APPEAL NO 401 OF 2018

(ON APPEAL FROM KCCC NO 3432 OF 2017)

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MAGISTRACY APPEAL NO 402 OF 2018

(ON APPEAL FROM KCCC NO 3496 OF 2017)

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MAGISTRACY APPEAL NO 404 OF 2018

(ON APPEAL FROM KCCC NO 3969 OF 2017)

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MAGISTRACY APPEAL NO 405 OF 2018

(ON APPEAL FROM KCCC NO 3971 OF 2017)

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MAGISTRACY APPEAL NO 415 OF 2018

(ON APPEAL FROM KCCC NO 502 OF 2018)

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(Consolidated by Order of Hon Alex Lee J dated 6 December 2018)

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R U L I N G

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Introduction

1.  The Applicants were each charged with and convicted of one charge of “driving a motor vehicle for the carriage of passengers for hire or reward without a hire car permit”, contrary to ss 52(3) and 52(10) of the Road Traffic Ordinance, Cap 374 (“RTO”).  By the judgment of this court handed down on 13 September 2019 (“the Judgment”), their appeals against conviction were dismissed. 

2.  With a view to appeal to the Court of Final Appeal, the Applicants now seek a certificate from this court for the following points of law which they say are of great and general importance and are involved in the Judgment:

(A)  What are the elements of s.52(3)(a) of the Road Traffic Ordinance, Cap 374 (“RTO”)? In particular: –

(i)     what is the proper construction of the phrase “for the carriage of passengers for hire or reward” as used in that sub-section;

(ii)    whether the sub-section requires proof that a defendant driver was driving for the subjective purpose of fulfilling a direct agreement for carriage between himself and the passenger from which the driver expected to be rewarded; and

(iii)   whether the sub-section requires proof that the defendant driver must have a “subjective purpose in their mind which was predominantly business or commercial in character” [Judgment §§65(iii) and 82], and if so, what does this element entail?

(B)  In respect of the compatibility of section 52(3)(a) RTO with Article 28 of the Basic Law (“BL”), and depending on the answer to question A above:

(i)     Whether BL Article 28 protects residents against laws which are overbroad, in particular whether the phrase “arbitrary or unlawful” encompasses the concept of “overbreadth”?

(ii)    Whether section 52(3)(a) RTO engages BL Article 28, and if so, whether it is inconsistent with BL Article 28 and is unconstitutional?

(C)   In respect of the compatibility of section 52(3)(a) RTO with BL Article 33, and depending on the answer to question A above:

(i)     Whether BL Article 33 is confined to protecting residents only against being forced to work in any particular field of occupation against their wish?

(ii)    If paragraph (C)(i) is answered in the negative, whether, on a correct construction, BL Article 33:

(a)  encompasses the freedom to work in any particular field of occupation of his choice; and/or

(b)  protects residents against the prevention from pursuing an occupation of his choice?

Whether section 52(3)(a) RTO engages BL Article 33, and if so, whether it is inconsistent with BL Article 33 and is unconstitutional?

3.  All parties have agreed that this application be dealt with on papers.  For that purpose, written submissions have since been received[1] and considered by this court. 

The test

4.  The test for certification under s32(2), the Hong Kong Court of Final Appeal Ordinance (Cap 484), which is not in dispute, is as follows:

(a)      whether there are points of law of great and general importance involved in the Judgment; and

(b)     whether such points of law are reasonably arguable.

See: Lee Kin Pong v HKSAR^[2]; and HKSAR v Fong Kwok Shan Christine^[3].

As regards Question (A): Interpretation of s52(3)(a), RTO

5.  In essence, the main issue under this head is sub-question (i), namely the meaning of the phrase “for the carriage of passengers for hire or reward” in s52(3)(a), RTO.  Sub-questions and (ii) and (iii) can be viewed as particular aspects of sub-question (i).  

6.  I agree with Mr Derek Chan, SC, counsel for the Applicants, that it is clearly a matter of great and general importance for Hong Kong residents to know whether they can work as Uber driver without contravening the law, particularly in the light of the fact that the criminal consequences of a contravention of s52(3) RTO include the risk of imprisonment. Besides, I also consider it important for anyone who may be interested in the service of Uber drivers to know whether their service in Hong Kong is legal or otherwise.  For the present purpose, however, the crux of the matter is whether any of the questions under consideration is reasonably arguable.

7.  It would be more convenient for me to first deal with sub-question (ii).  As this court, this court says[4]:

“(ii) I agree with Mr Chan that the phrase “for the purpose of carriage of passengers for hire or reward” clearly refers to the state of mind of the offender, ie, the driver or user of the motor vehicle in question, as the case may be, so that it is an aspect of the mens rea of the offence for which the prosecution bears the burden of proof. The prosecution must prove that the accused bore the prohibited subjective purposes at the time of the offence. By “prohibited subjective purposes”, I mean that the driving or using, as the case may be, must be “for the carriage of passengers for hire or reward”. On the other hand, I accept with Mr Tam that, by a plain and ordinary reading of s 52(3), the phrase under consideration does not pertain to the actus reus, so that actual payment is not an essential ingredient of the offence. Therefore, I respectfully disagree with the magistrate that “there must be a reward paid or received for the carriage of the passenger”.

(iii) In my humble view, the first part of the prohibited purpose (“for carriage of passengers”) must take colour from its second part (“for hire or reward”). On that basis, I agree with Mr Tam’s submission to the extent that the first use of the word “for” in the phrase describes the purpose of driving the car and the second use of the word “for” denotes a causal link between the “carriage of passengers” and the “hire or reward” in question, so that the reward expected by or actually paid to the defendant driver has to be derived from the “carriage of passengers”, albeit not necessarily directly from the passengers concerned. Moreover, in view of the legislative history and context that s 52(3) and its predecessor were enacted to combat the problem of “pak pai” (an unofficial taxi service), in my humble judgment the kind of “carriage of passengers” which s 52(3) targets at is one which has a predominately business or commercial rather than a friendly or social arrangement. This interpretation is also consistent with the local authorities on the old legislation including Kwong Pak-yam v The Queen, Ngai Kam-chung v The Queen and Li Wing Cheung v The Queen.”

8.  What the Applicants now contends is that:

“In other words, the offence is proven only if the Applicants were driving for the purpose of fulfilling a direct agreement for carriage between himself and the passenger (i.e. for the carriage of passengers) from which he was to be rewarded (i.e. for hire or reward).”[5] (Emphasis supplied)

9.  I do not understand Mr Chan to mean that there has to be an actual payment to the driver before an offence under s52(3)(a), RTO can be made out, as an actual payment is clearly not required by the clear wording of the provision.  If one stands back and looks at the differences between the holding of this court on the one hand and the Applicants’ contention on the other, a major one which stands out is the Applicants’ insistence on “a direct agreement of carriage between [the driver] and the passenger”.  Whatever that “direct agreement” may entail, Mr Chan contends that it is a necessary condition for the offence, without which there cannot be a conviction.

10.  The basis for this contention of Mr Chan is said to be two of Huggins J’s judgments.  The first one is Kwong Pak-yam v The Queen[6], where his lordship said:

“I accept that it was necessary for the prosecution here to establish an express or implied agreement of carriage and the contrary has not been argued.”

The second one is Ngai Kam-chung v the Queen[7], where his lordship said:

“I come back now to the argument that there was no evidence upon which the magistrate could find that the use of the car was for hire or reward because no mention of money was made until the end of the journey. It is well-established that where two parties enter into a contract for work to be done by one of them and no remuneration is fixed there is an implied term that a reasonable sum will be paid. What is essential is that the parties shall have intended to enter into an agreement in contemplation that the work should not be performed gratuitously.” (emphasis added)

11.  Mr Chan argues that the aforesaid “agreement for carriage” is based on “the common expectation between the passenger and driver that a payment would be made”.  Mr Chan goes on to submit that such an agreement “could only be as between the driver and passenger” and as such, “if the agreement was made between the passenger and a third party other than the driver, the driver would be driving for a different purpose, and not for the carriage of passengers for reward”[8].

12.  With respect, there are several difficulties with Mr Chan’s above contention:

(a)     It is one thing to say that there has to be a common expectation between the driver and the passenger that “a payment would be made”. It is quite another to say that the payment in contemplation has to be based on “a direct agreement” between the passenger and the driver.  This is illustrated by the facts in Orr v Trafalgar Insurance Company Ltd[9] cited in the Judgment. 

(b)    If, by “a direct agreement” between the driver and the passenger, Mr Chan meant a common expectation or understanding between the two that the driver would be paid directly by the passenger, then that would represent too narrow and simplistic view of modern transactions.  This is because nowadays it is common that customers do not necessarily pay their service providers directly.  An obvious example is payment by credit card.  It would be really surprising indeed if a driver who accepts credit card from his passenger for payment is not driving “for hire or reward”.

(c)     If what Mr Chan means by “a direct agreement for carriage” is just a common expectation or understanding between the driver and the passenger that the driver would get his reward from the carriage he provided no matter from whom he was supposed to receive the money, then this is in fact a “non-issue” here.  This is because there had never been any dispute that the applicants had all intended to get a reward from and the passengers concerned had all intended to pay for the carriage.

(d)    The way Mr Chan reads Huggins J’s judgments is to treat them if they were statutory provisions and that is not the proper approach.  The word “agreement” was used loosely by his lordship in the two cases, rather than in the sense of a contract, still less in the sense of a legally binding agreement.  As explained in the Judgment[10], the effect of Kwong Pak-yam and Ngai Kam-chung, properly understood, is that the carriage in question should not be performed gratuitously and that the defendant driver had to be expecting a payment.  The two cases, when read in their proper context, do not in fact support Mr Chan’s proposition.

(e)     In any event, I have already given full reasons as to why I said that s52(3)(a), RTO[11] focuses solely on the act and purpose of the defendant driver.  

13.  Furthermore, I am unable to agree with Mr Chan’s submission that this court’s interpretation of the phrase “for carriage of passengers for hire or reward” as stated in those paragraphs:

“does not give effect to the causal link between (a) the driver’s subjective purpose in driving; (b) the carriage of passengers; and (c) for hire or reward.”[12]

In my humble view, if the driver drove a passenger because he was expecting a payment from the carriage, then there would clearly be a sufficient causal link between the carriage he provided and his purpose for the driving in question.  With every respect, as mentioned in the Judgment, while the presence of “a direct agreement” would assist in proving the offence, it is not a must.

14.  I am also unable to agree that this court’s interpretation of the phrase under consideration fails to give any consideration as to why the defendant driver is getting rewarded, ie, whether he is getting the reward:

“pursuant to a carriage agreement between himself as the driver (which it is accepted would amount to a s.52(3) RTO offence), or pursuant to another genuine independent contract that exists externally to any incidence of carriage of passengers (which we submit is not a s.52(3) RTO offence).”[13]

15.  As to this, the following points need to be noted:

(a)      By “an independent contract that exists externally to any incidence of carriage of passengers”, I take it that Mr Chan means to exclude a tripartite situation involving collateral contracts as between the driver, the passenger and Uber.  This is because in which case there would still be “an agreement”, albeit unenforceable for “illegality”[14], as between the driver and the passenger: see generally Chitty on Contracts, Volume 1, at §18-005.  Based on Mr Chan’s aforesaid concession, that would still amount to a s.52(3) RTO offence.  As such, there remains only two theoretical possibilities, namely, either that the drivers were acting as employees or as independent contractors (of Uber).

(b)     However, it had never been the case of any of the Appellants that they were employees of Uber and there was not a scintilla of evidence to even raise that as an issue either. 

(c)      Even assuming that the Applicants were independent contractors of Uber[15], which would be contrary to the factual finding of the magistrate, I am unable to see any reasons, as a matter of statutory interpretation taking into account the legislative policy and purpose behind the legislation, why they should be exempted from the licensing requirements and should fall out of the prohibition imposed by s 52(3)(a) just because they were independent contractors.

16.  As to sub-question (iii), as explained in the Judgment[16], the phrase “for the carriage of passengers for hire or reward” should be considered as a whole rather than disjunctively, so that the first part of the prohibited purpose (“for the carriage of passengers”) must take colour from its second part (“for hire or reward”).  I do not agree with Mr Chan that this court, by holding that “the kind of ‘carriage of passengers’ which s 52(3) targets at is one which has a predominately business or commercial rather than a friendly or social arrangement”, was engaging in judicial legislation.  As stated in the Judgment, this court in so interpreting the phrase was simply following a consistent line of local case authorities to the similar effect.  The court has not done anything innovative. 

17.  As regards the examples given by Mr Chan about chauffeurs employed by a company to drive its client or a set of chambers to its members, with respect, these examples are “red-herrings”.  

18.  Firstly, as pointed out by Mr William Tam, SC, DDPP, counsel for the Respondent[17], it had never been any of the Applicants’ case that they were acting as employees of Uber or anyone else.  As such, the issue simply does not arise out of the Judgment.  Therefore, even assuming that Mr Chan were right that the prohibition imposed by s 52(3)(a) does not apply to employed chauffeurs, that would not assist the Applicants.

19.  Secondly, if the aforesaid services are provided to clients or members, as the case may be, free of charge, then s 52(3), RTO does not “bite”.  If the service is provided at a journey-dependent fare[18], then I fail to see why the company or the chambers concerned should not apply for a licence or permit in order to run the service.  And if there is an existing and valid licence or permit covering the service, then one would not expect any prosecution of the chauffeur under s 52(3), RTO.  However, if there is not an existing and valid licence or permit when one is required, and if the chauffeur knows that the service is not covered by any licence but nonetheless chooses to drive as told by his employer, then as I have already said in the Judgment,  I am unable to see why he should not be held liable on the basis that he was a party to a joint enterprise or was otherwise aiding and abetting[19], whether he was driving as an employee or an independent contractor.  See Archbold Hong Kong 2019, at §16-54.

20.  Coming back to sub-question (i), it is my humble view that it is also not reasonably arguable.  This is because:

(a)      there is not any case authorities which, properly understood, could support the Applicants’ contention for the requirement of “a direct agreement for carriage”;

(b)     apart from those arguments pertaining to sub-questions (ii) & (iii), there has been no other arguments advanced on the Applicants’ behalf with a view to show that this court’s interpretation on s52(3)(a), RTO may be erroneous; and

(c)      this court’s interpretation was based on a consistent line of local case authorities.

As regards Question (B): “Overbreadth”

21.  The issue about “overbreadth” has been briefly dealt with in the Judgment[20]. In short, it is in my humble view that the issue is not engaged in the present case, whether or not the concept of “overbreadth” is to be regarded as an aspect of the protection against “arbitrariness” entrenched by Article 28 of the Basic Law or pertaining to a separate protection generally entrenched by Article 39. 

22.  As such, I am not unable to agree that this question is reasonably arguable. 

As regards Question (C): Freedom of choice of occupation

23.  As noted in the Judgment, this issue was not argued before this court, as Mr Chan acknowledges that this court is bounded by the judgment of the Court of Appeal in Leung Sze Ho Albert v Bar Council of the Hong Kong Bar Association[21]which, he accepts, is adverse to the Applicants’ case.  Therefore, in the Judgment this court has not expressed any view on this ground of appeal.

24.  As there are no higher case authorities which may cast doubt on the correctness of the Court of Appeal’s judgment in the case Leung Sze Ho Albert, this court is not in a position to agree that the question under this head is reasonably arguable. 

Conclusion

25.  Based on the above, the Applicants’ application is dismissed.

26.  It remains for me to thank all counsel for their customary well-researched and helpful submissions, for all of which I am indebted.