HON MING KONG AND ANOTHER v. SECRETARY FOR JUSTICE

HCAL 47/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO. 47 OF 2008

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R E A S O N S  F O R  J U D G M E N T

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Introduction

1. On 7 April 2008, a criminal trial commenced in the District Court before Judge Stanley Chan.  Shortly after the commencement of the trial, when the first prosecution witness was near to completing his evidence-in-chief, an application was made by counsel for the first and second applicants for the judge to recuse himself.

2. In a full ruling, the judge declined to recuse himself.  Consequent upon that ruling, the applicants sought leave to apply for judicial review, seeking an order of certiorari to quash the ruling of the trial judge and an order of prohibition prohibiting him from continuing to sit as the judge in the proceedings.

3. I granted leave and ordered that there be an expedited hearing.

Background

4. At all times material to the criminal prosecution of the two applicants, they had been involved in the management of a publicly listed company which, for convenience, I will refer to as China Sciences.

5. The applicants were charged with a number of offences of dishonesty arising out of their management of the company.  For the purposes of this judgment, it need only be said that the prosecution alleged that they had conspired to steal money from the company by means of bogus transactions and the like and had conspired to disguise those transactions, the first applicant, who had been chairman of the company, being charged, in particular, with approving annual reports in which the transactions had been stated to be genuine.

6. When arraigned, both applicants pleaded not guilty to all the charges brought against them.

7. The first witness to testify for the prosecution was a man by the name of Chan Tat Chee.  Chan had been Chairman of China Conservational Power Holdings, a company associated with China Sciences.  As I have said earlier, he had almost completed his evidence-in-chief when the application for recusal was made.

8. Chan Tat Chee has given his evidence as an accomplice witness.  At one stage he had himself been a defendant along with the applicants.  However, he had pleaded guilty to a total of six charges brought against him for misappropriating funds from China Conservational Power Holdings and had agreed to testify as a prosecution witness.

9. Although, in the hearing before me, there was some uncertainty as to the exact sum involved, it appears that Chan had admitted to the personal misappropriation of about $80 million.  

10. That being said, Mr Zervos SC, leading counsel for the respondent, emphasised that the sums in respect of which Chan had admitted guilt were separate entirely from the sums which formed the subject matter of the charges brought against the applicants.  That was not disputed.

11. From what was said during the course of submissions, it is apparent that it will be part of the applicant’s defence that Chan has misappropriated a far greater sum than the amount in respect of which he admitted guilt.  In short, as I understand it, in pleading not guilty, it is to be integral to the applicants’ defence that they have acted honestly at all times and that the criminal conduct of which they have been accused has, in truth – in part or whole – been the conduct of Chan.

12. That being the case, what Chan did with his misappropriated funds may be a matter of significance in mounting an effective defence for the applicants.

13. In certain of the prosecution material examined by counsel for the applicants, there is a record of Chan paying a sum of HK$1 million to a man named Lai Sai Sang.

14. Lai had been the Chairman of China Conservational Power Holdings from May 2001 until February 2003 when Chan had assumed that position.  There was also evidence that Lai (and his wife) continued to receive some sort of salary or consultancy fee from the company.

15. More than that, in or about 2003, Lai (and his brother) had given evidence for the prosecution in a corruption trial, admitting that he had made corrupt payments to a senior public servant by the name of Chan Kau Tai in order to ensure he was able to secure government contracts.

16. Again, however, as Mr Zervos emphasised, the criminal proceedings brought against Chan Kau Tai, and Lai’s involvement in those proceedings, are entirely independent of, and unconnected with, the criminal proceedings instituted against the applicants.

17. In addition, of course, it cannot follow as a matter of course that because a person has admitted paying bribes to a civil servant in order to protect his own business interests that he will also be prepared to involve himself in other criminal activities involving theft and other forms of dishonesty.

18. Lai himself, I have been told, will form no part of the prosecution case against the applicants.  He is irrelevant to it.

19. Counsel for the applicants, however, formed the view that it may well be necessary to call Lai as a witness for the defence, in part at least in order to undermine Chan’s testimony.  It was that decision which led to a formal application being made to the judge to recuse himself.

20. Why was that?  The recusal application was made because – after the commencement of the trial – it was discovered that the judge, prior to entering the Judiciary, at a time when he had been a prosecuting counsel in the Criminal Division of the Department of Justice, had had professional dealings with Lai.  As the judge put it in his ruling :

“There is no allegation of actual bias.  The basis for the application is that I had worked in the Department of Justice and was the advising counsel in the Chan Kau Tai case …

As I was involved in the case of Chan Kau Tai, it was submitted that it is likely that I would have formed a view as to the character, credibility and reliability of the Lai brothers.”

21. The judge, very properly, in my view, prepared a statement setting out his history in the Department of Justice and his involvement in the Chan Kau Tai case.

22. While the judge had been involved in determining that Lai should be given immunity to testify as a prosecution witness, he confessed to having very little recollection of Lai’s testimony.  But, as he acknowledged —

“… it was submitted that based on my statement I would ‘have formed a view on Lai’s character, credibility and reliability as a likely witness in this trial’, and ‘there is a real possibility that when Lai gives evidence in the present trial, his Honour’s memory may be jogged and recall matters which he had come to know while he was the advising counsel in Chan Kau Tai’s case.’”

23. In the final analysis, said the judge :

“… it was submitted that, through the prism of a proverbial observer, I should recuse myself from any further conduct of this case, and also prudence would require me to do so in light of the real possibility of Lai giving evidence in this trial.”

24. The prosecution opposed the application.  Prosecuting counsel did so essentially on the basis that Lai had no known connection with any of the charges in the trial and was in all respects a peripheral witness.  For example, as to Lai’s previous chairmanship of China Conservational Power Holdings, the judge recorded the submissions of prosecuting counsel being to the following effect :

“[The company] was involved in charges 11 and 12 of the present trial.  These offences were allegedly committed in December 2004, and Lai had left [the company] in February 2003.  In the Chan Kau Tai case, Lai’s involvement in the corruption or mismanagement of [the company] occurred in 2001.  As such, it was submitted that, ‘Whatever faults may have existed in the management practices of [the company] in 2001 clearly have no bearing on how [it] was being run in 2004/2005.”

25. No suggestion has been made that the judge misdirected himself as to the correct test to be adopted in determining whether he should, or should not, recuse himself.  He said the following :

“… the test for apparent bias is that the court must first ascertain all the circumstances which have a bearing on the suggestion that the judge was biased.  He must then ask whether those circumstances will lead a reasonable, fair-minded and well-informed observer to conclude that there is a real possibility that the judge would be biased in dealing with the matter.”

26. The judge also observed that there must be a ‘reasonable’ apprehension of bias and that it was important that judges do not accede too readily to suggestions of appearance of bias thereby encouraging parties to believe that, by seeking disqualification, they will have their case tried by someone thought to be more likely to decide the case in their favour.

27. The judge declined to recuse himself.  In respect of his reasons, inter alia, he said the following :

(i)    He had worked in the Department of Justice for nearly 20 years, handling many cases and just one among those cases had been the Chan Kau Tai prosecution.

(ii)  In respect of that prosecution he had given advice, that advice in part being related to Lai being an immunity witness.

(iii)    But Lai was not involved in the charges faced by the applicants nor was it inevitable that he would be called by the defence for any material purpose.  As the judge put it :

“All along, counsel … could only submit that ‘there is a real possibility of’ or ‘it is very likely’ of Lai giving evidence in the present trial.”

This court’s function

28. As a reviewing court, this court must set itself the same test as the trial judge.  It must itself consider the relevant circumstances and then determine whether those circumstances would, or would not, lead a reasonable, fair-minded and informed observer to conclude that there is a real possibility of bias.

29. A perception of bias is not a discretionary matter, one to be weighed in the scale of convenience.  In this regard, I can do no better than cite the headnote of AWG Group Ltd v. Morrison [2006] 1 All ER 967 :

“There was either a real possibility of bias, in which case the judge was disqualified by the principle of judicial impartiality, or there was not, in which case there was no valid objection to trial by him.  Inconvenience, costs and delay did not count in a case where the principle of judicial impartiality was properly invoked …”

The failure to make the recusal application at the commencement of trial

30. I was initially concerned that the recusal application had not been made at the beginning of the trial but had only been made when the first prosecution witness, an important accomplice witness, was nearing the end of his evidence-in-chief.

31. It was explained to me, however, that counsel had only learnt of the past relationship between the judge and Lai after commencement of trial and that the recusal application had been made as soon as reasonably possible thereafter.

32. That being the case, issues of waiver on the part of the applicant did not arise.

Is there any basis for even suggesting a possibility of bias?

33. In or about 2002, the trial judge had been employed as a prosecuting counsel.  In discharging his professional responsibilities as a prosecutor, he had played a material part in determining that Lai should give evidence under immunity as a prosecution witness.  A determination of that nature, even if based substantially on the recommendation of the investigating agency, would have involved an assessment of Lai’s credibility, if only in respect of the matters to which he would testify. 

34. The trial judge had therefore at an earlier time, not as a judge but in the partisan role of a prosecutor, come to a determination of Lai’s credibility and through that assessment, even if only to a lesser degree, of Lai’s general character.

35. It may be said that, having determined that Lai would be a credible witness in the Chan Kau Tai trial, that would work to the benefit of the defence in the present trial.  Lai, if he is to be called, will be called for the essential purpose of impeaching the credibility of the prosecution witness, Chan.  But, in my judgment, that view is simplistic.  A reasonable, fair-minded and informed observer would take into account that a prosecutor, even if he is prepared to accept the credit of an accomplice witness in respect of the limited circumstances of a trial, may otherwise form a very poor view of that person’s character and the extent to which in other matters he is to be believed.

36. In the circumstances, leaving all other relevant factors aside, it seems to me that the trial judge’s past association with Lai may well lead a reasonable, fair-minded and informed observer to conclude that, if Lai is called to give evidence, there is a real possibility of bias arising on the part of the judge.

37. Such bias will, of course, be sub-conscious but it does not follow that it will necessarily be any less insidious.

38. Nor, in my view, can it be said that the passage of time has removed any real possibility of bias.  The judge’s memory may be revived if Lai testifies.  That dawning realisation of – ‘Ah yes, I remember you now’ – is known to all of us.

But a ‘mere possibility’ of bias does not amount to a ‘real possibility’

39. As the trial judge recognised, there is ample authority to the effect that courts must always view applications for recusal with care and caution.  The judge must therefore be satisfied not that there is simply some possibility of an appearance of bias but that there is a real possibility of it.  That possibility, it has been recognised, must be firmly established.

40. In the present case, matters have been made far more difficult by the fact that there is no assertion of an existing perception of bias.  The assertion is prospective.  It has not yet arisen and may never arise.  I say that because it is evident that Lai may not be called as a witness and, even if he is called, there is uncertainty as to the matters to which he will be asked to testify.

41. In determining whether there is a real possibility that at some stage during the trial a perception of bias may arise, it seems to me that a logical guideline is provided by consideration of the following three questions :

(i)    Is there a real possibility that the witness will be called?

(ii)  If called, is there a real possibility that he will be asked to testify as to a material matter?

(iii)    If he does testify as to a material matter, will his testimony require an assessment by the trial judge of his credit as a witness? 

My conclusions

42. During the course of the hearing, Mr Martin Lee SC, leading counsel for the first applicant, said that details of the HK$1 million payment made by Chan to Lai had been requested from the investigating agency, the ICAC.  The response had been received from Lai via the ICAC that the payment had been made to discharge a personal debt.  No further details were given.

43. According to Mr Lee, at least one further payment of HK$1 million from Chan to Lai is suspected.  But seemingly that had not been put to Lai.

44. Indeed, as Mr Lee conceded, Lai himself has not been approached by the defence either with a request to impart information or to agree to testify.

45. Nor, as I understand it, does the defence have possession of any evidence which goes to identify the true nature of any relationship that may have existed between Chan and Lai and, more particularly, the true nature of their financial dealings.

46. The defence may, therefore, have questions that, if the need arises, they would like to ask Lai but they have no way of knowing the nature of his answers, other than in respect of that single payment of HK$1 million.

47. That being the case, if Lai is called to give evidence, as matters stand, he will be called ‘blind’.  His evidence may be of no value at all.  It may, of course, assist the defence by undermining Chan’s credit but equally it may support Chan’s credit and be adverse to the defence, perhaps materially so.  Notoriously, no counsel would wish to call a witness who is such an unknown quantity, a witness who may as likely damage a case as advance it.  Mr Lee accepted that this was so.  But he went on to say that, if there were no viable alternatives, then it may be, albeit as a measure of last resort, that such a witness would have to be called.  As Mr Lee put it, sometimes a defence is left with ‘Hobson’s Choice’; that is, no choice at all.

48. While a decision whether or not to call a witness will, in the final analysis, depend on what arises in the prosecution case, it was effectively conceded – certainly, as I understand it – that Lai was not in the front rank of potential witnesses for the defence.  How could he be if the defence had no idea of whether his evidence would be beneficial or adverse?  Indeed, it emerged that, for all practical purposes, Lai would have to be a witness of last resort.

49. In such circumstances, while it is possible that Lai will have to be called, I do not see how it can be said that there is a real possibility of that happening.  It seems to me, on analysis, that the true basis of the recusal application was therefore purely precautionary.

50. Of course, it behoves a trial judge in these matters to act with caution.  As was said in AWG Group Ltd v. Morrison (supra) :

“If, as here, the court has to predict what might happen if the hearing goes ahead before the judge to whom objection is taken and to assess the real possibility of apparent bias arising, prudence naturally leans on the side of being safe rather than sorry.”

51. But ‘prudence’ by way of taking the easiest option is not the governing principle.

52. In my judgment, the uncertainty as to whether Lai will be called at all is compounded by uncertainty as to the matters to which he will be called to testify.  And if the subject matter of his possible testimony remains uncertain, it must be equally uncertain whether any issues that are raised will, in any material way, require an assessment by the trial judge of Lai’s credit as a witness.

53. It may, of course, transpire that Lai will have to be called and it may transpire that he will be tested as to matters of real substance requiring a careful assessment of his credibility.  If so, then a claim of perceived bias will have to be considered again.  But that is not the issue.  The issue is whether – as things now stand – there is a ‘real possibility’ of that happening and I am satisfied that, while such a possibility cannot be entirely excluded, there is, in truth, no such real possibility.  How can there be when the defence have not even attempted to approach Lai and have no idea of the nature of his evidence in respect of any issue other than that HK$1 million to which I have made reference?

54. In the circumstances, in adhering to what I have found to be the correct principles, while the issue has not been the easiest to resolve, I am satisfied that – as matters now stand – the judge was correct to refuse to recuse himself.

55. Accordingly, the application for judicial review is dismissed.  There will be an order for costs in favour of the respondent.