COMMISSIONER OF POLICE v. LIN XIN NIAN

HCMP5651/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO.5651 OF 1998

--------------------------------

-----------------------

J U D G M E N T

-----------------------

1. The Secretary for Justice, on behalf of the applicant, the Commissioner of Police, applies by way of summons dated 11 March 1999 for an order of forfeiture of the sum of CAN$380,060 found in the possession of the respondent at Chek Lap Kok Airport on his arrival in Hong Kong from Vancouver on 19 October 1998. That order is sought pursuant to section 24D(1) of the Drug Trafficking (Recovery of Proceeds) Ordinance, Cap.405. That section says :-

" 24D(1) While any seized property is detained under section 24C(2) or (3), a court may, if satisfied on an application made by or on behalf of the Secretary for Justice that such property-

(a) in whole or in part directly or indirectly represents any person's proceeds of drug trafficking;

(b) has been used in drug trafficking; or

(c) is intended for use in drug trafficking,

order, subject to subsection (2), the forfeiture of such property,

...."

The three limbs of section 24D(1) are not exclusive. A court may make a forfeiture order based upon any or all of the limbs, see Ali v. Best [1997] 161 JP 393. In the present case, the applicant relies upon all three of the limbs so far as the forfeiture of the CAN$380,060 is concerned, but it is true to say both the evidence and submissions at this hearing were primarily directed at proof of section 24D(1)(a) only.

2. The facts in this case which are not in dispute are that on 19 October 1998 at about 18:30 hours, the respondent, who is a Canadian resident and additionally the holder of a People's Republic of China passport, arrived at Hong Kong International Airport on a flight from Vancouver, Canada. Shortly after his arrival, he was searched by police officers in the Airport Arrivals Hall, and found to be in possession of an item of luggage, a suitcase, containing most of the CAN$380,060. The balance of the money was found to be in the pockets of the trousers that he was wearing at the time. When asked to explain his possession of such a large amount of cash and why he was bringing it into Hong Kong, he claimed that he had borrowed a major part of the money from his sister in Canada, the rest was his, and that he intended to take the whole of the money to Mainland China to give to his father.

3. The monies found on the respondent were then seized by the police pursuant to section 52 of the Dangerous Drugs Ordinance, Cap.134, and subsequently detained pursuant to section 24B of the Drug Trafficking (Recovery of Proceeds) Ordinance, Cap.405. Subsequently, a number of orders were made pursuant to sections 24C(2) and (3) of Cap.405 for the continued detention of the property.

The preliminary issue

4. When the matter came before this court, the preliminary issue which arose concerned the contents of the affirmations of Detective Senior Inspector Cheung Hon Bun filed in support of the summons. The question which arose was firstly whether those affirmations were entitled to contain hearsay evidence, or whether they could only be taken into account so far as the deponent was able to state something according to his own knowledge. The second question which arose was that in the event the affirmations could contain what would otherwise be hearsay evidence, whether the annexures to the affirmations could be taken into account independently of simply providing grounds for the statement of belief in the body of the affirmation.

5. The summons and supporting affirmation of DSI Cheung Hon Bun were filed pursuant to Order 115, rule 29 of the Rules of the High Court. That rule states :

"29. Application of forfeiture of seized property

(1) An application under section 24D(1) for the forfeiture of seized property shall be made by summons in the proceedings under which any order under rule 24 has been obtained.

(2) An application under paragraph (1) shall be supported by an affidavit, which shall state the grounds for believing that the seized property-

(a) in whole or in part directly or indirectly represents any person's proceeds of drug trafficking;

(b) has been used in drug trafficking; or

(c) is intended for use in drug trafficking."

6. The initial question for determination was whether Order 115, rule 29(2) allows me to accept hearsay evidence, i.e. evidence of belief rather than evidence only of the deponent's own knowledge. The phraseology in Order 115, rule 29(2) is to the effect that the affidavit "... shall state the grounds for believing ...."

7. Order 41, rule 5(2) contains a similar provision which relates to affidavits sworn for the purposes of interlocutory proceedings. That provision states :

" (2) An affidavit sworn for the purpose of being used in interlocutory proceedings may contain statements of information or belief with the sources and grounds thereof."

8. Whilst it is true that the precise terms of Order 41, rule 5(2) differ from those of Order 115, rule 29(2) in that the former refers to the provision of both sources and grounds for both the information or belief of the deponent, in my view the same principles apply to the determination of the meaning and scope of each sub-rule and cases determining the effect of Order 41, rule 5(2) are capable of throwing light upon the proper operation of Order 115, rule 29(2).

9. In Savings & Investment Bank Ltd v. Gasco Investments (Netherlands) B.V. and Others [1984] 1 WLR 271, in dealing with the provisions of Order 41, rule 5(2), Gibson J said :

" Neither counsel has been able to cite any authority which elucidates the scope of what is or is not permitted by Ord. 41, r. 5(2). It is obvious from the sub-rule itself that it operates as an exception from the primary rule of evidence stated expressly in Ord. 41, r. 5(1), that a person may only give evidence as to facts, which he is able of his own knowledge to prove. Rule 5(2), by its including statements of information or belief, plainly allows the adduction of hearsay. It also allows a statement of belief, that is to say, an opinion; but in its context that belief must be that of the deponent, and such statements will have no probative value unless the sources and grounds of the information and belief are revealed."

10. With that statement of the law I agree so far also as Order 115, rule 29(2) is concerned. Any provision such as Order 15, rule 29(2) or Order 41, rule 5(2) which permits evidence to be provided to a court or tribunal expressed in the form of a belief based on disclosed grounds or sources must envisage the deponent providing what would otherwise be hearsay evidence to the court.

11. That must be a deliberate decision of the legislature based upon usually apparent reasons.

12. In the present case, those reasons, in my view, must include an appreciation of the difficulties, no doubt insurmountable at times, in providing direct evidence of the connection of the property, which may not originate in Hong Kong, with drug trafficking.

13. Establishing that connection will often require enquiries being made overseas, sometimes in more than one jurisdiction.

14. The purpose of allowing hearsay evidence before a court in an application under section 24D(1) is to remove disproportionate difficulties of proof so far as that application is concerned.

15. Protection for the respondent's interests is provided for in the requirement that the grounds for the deponent's belief be set out in the supporting affidavit.

16. That is an important requirement and is not to be taken lightly. Unless those grounds are properly set out in the affirmation, the contents of the affirmation, so far as they are contested, will not be in admissible form : Leung Kin Fook v. Eastern Worldwide Co. Ltd [1991] 1 HKC 55 and Korea Sonbak Shipping Co. v. Charter Harvest Shipping Ltd [1994] 1 HKC 494.

17. Identification of the grounds for the deponent's belief enables the contesting party the opportunity to explore those grounds and perhaps evidentially counter them. In any event, the requirement that the grounds for the deponent's belief be stated sufficiently protects the contesting party's interests so far as Order 115, rule 29(2) allows the application pursuant to section 24D(1) to proceed by way of hearsay evidence.

18. That leaves the question as to, as in the present case, the evidential status of any document annexed to the deponent's affidavit as the grounds for any statement of belief by the deponent.

19. In the event that that document contains more factual information than does the deponent's statement of belief or fact, does the document's additional statement of fact have an evidential status independent of the deponent's own evidence in the body of the affidavit?

20. In other words, is a court entitled to regard any such document as evidence in its own right?

21. I do not think so. The deponent's statement of fact or belief is sworn. The contents of any exhibited document are not. There is lacking, without the deponent's sworn statement of belief, an essential guarantee of evidential reliability so far as any one document or part thereof annexed to the affidavit is concerned. In my view the plain intention of the legislature is not that documents or allegations of fact of any sort be able to be presented to the court as evidence. That would be unfair to the other party. The protection provided is that the deponent, having been given the document, is able to form a genuine belief based upon that document and attest to that belief.

22. It may be argued that the fact that such a document is unsworn or is not produced by its maker or is not otherwise in evidentially admissible form itself goes to weight only and that any such document should still in its own right be evidence. At the end of the day, in my view, any such argument runs contrary to the clear intent of the terms of Order 115, rule 29(2). The evidence to be provided is that of the deponent, not of the makers of the documents or instruments he relies upon in formulating his belief. Those documents or sources annexed to or set out in the deponent's affirmation have no evidential life of their own. They simply demonstrate the source of the deponent's belief. They can be examined to test what weight should be attached to the deponent's statements of fact which are based upon them.

23. Accordingly for the purposes of the present case I will allow into evidence all assertions of fact contained in the affirmations of the deponent filed and read in these proceedings where those assertions are either within the deponent's own knowledge or are effectively stated to be to the best of his belief and where the grounds or sources of that belief is stated in the affirmation or produced by it.

24. One further related matter which arises concerns the nature of the sources or grounds for the deponent's belief. Do those grounds or sources themselves have to be the original source or ground or can they themselves be hearsay in nature?

25. In an unreported decision of Re A Defendant (The Times, 7 July 1987), a case involving forfeiture of monies relating to drug dealing, the court rejected a submission advanced on behalf of the defendant in those proceedings that the affidavit in support of the application referred to unnamed investigating police officers and itself was not therefore properly grounded on the original source of the information as the basis of the deponent's belief.

26. This submission was rejected. The court accepted that a general reference to the grounds for the deponent's belief was sufficient.

27. In my judgment, it would be wrong to apply the rules of evidence to material which itself is not evidence and which simply goes to the weight to be attached to the expression of fact, based on that material, by the deponent. Accordingly in my view the grounds for the deponent's belief, as I have said, do not themselves have to be in such a form or of such a nature so as to be independently admissible as evidence.

28. For that reason, hearsay can be taken into account by the deponent as being a ground for his formulation of belief. The fact that the ground relied upon is hearsay or is otherwise in evidentially inadmissible form goes to the weight to be attached by the court to any statement of fact of the deponent based upon that ground.

29. A final preliminary issue was whether Order 41, rule 5(1) should apply to these proceedings so as to require that the contents of affirmations relied upon could only contain statements from the deponent's own knowledge.

30. Order 41, rule 5(1) states :

" Subject to Order 14, rules 2(2) and 4(2), to Order 86, rule 2(1), to paragraph (2) of this rule and to any order made under Order 38, rule 3, an affidavit may contain only such facts as the deponent is able of his own knowledge to prove."

31. Mr Percy argues on behalf of the respondent that Order 41, rule 5(1) has application to section 24D(1), Cap.405 applications because the Rules of the High Court through Order 1, rule 2(3) have general application to matters to which Order 115 applies to. And Order 115, rule 29 has specific application to section 24D(1), Cap.405 applications such as the present.

32. I accept the arguments of Mr Blanchflower for the applicant in this regard.

33. Order 41, rule 5(1) may not expressly exempt Order 115, rule 29 from its operation as it does the other specified orders therein. But sense must be given to Order 115, rule 29. If Order 41, rule 5(1) were to apply to section 24D(1), Cap.405 applications, then Order 115, rule 29, which expressly and specifically applies to such applications would have no effect. That cannot be intended.

34. In my judgment, applications pursuant to section 24D(1), Cap.405 are governed by Order 115, rule 29, and Order 41, rule 5(1) has no application so as to prevent the operation of Order 115, rule 29 which in its terms allows hearsay evidence.

The substantive issue

35. It is not in issue that on 19 October 1998 the respondent arrived at Chek Lap Kok International Airport in Hong Kong from Vancouver, Canada, with a suitcase containing some CAN$300,000 and that his trousers pockets contained a further sum of about CAN$80,000 in mostly small denominations. Those sums represented an approximate amount of HK$1,900,000 at that time.

36. The applicant's case briefly is that given the association of the respondent with drug dealers in Canada and his method of transportation of the money that was seized from him at the Hong Kong International Airport on 19 October 1998, the probability is that those monies represented the proceeds of drug trafficking in Canada.

37. The respondent's case briefly as set out in his two affirmations, which exhibited the affirmations of his sister Wong Yee Wah and his father Lam Hin Loi, is that the money represented partly his own monies obtained mainly from a computer business operated with his sister and brother-in-law and also his sister's borrowings from her friends and the sale of her car.

38. From the affirmations of Detective Senior Inspector Cheung ("DSI Cheung"), I accept that the respondent is connected with people involved with drug dealings in Canada. I find that the evidence of DSI Cheung in this regard is cogent and based on reliable and credible grounds as particularly set out in his 3rd affirmation. I accept from that evidence that on 27 May 1997, Canadian police monitored a drug delivery of an amount of heroin involving a person Chan Kwok Yung. That person paid the police agent involved in the drug delivery for the delivery of the heroin. Chan Kwok Yung appeared at the scene, in a car registered in the name of the respondent. Subsequently Chan Kwok Yung was found to possess the respondent's telephone numbers, those same numbers being provided by the respondent to the Hong Kong police some 18 months later when he was detained at Chek Lap Kok Airport on 19 October 1998.

39. In a subsequent part of the same investigation, on 24 November 1998, that is about five weeks after the respondent's arrest in Hong Kong in respect of the present matter, a person Chan Chi Hang was observed by Canadian police in Richmond, British Columbia, going into a particular storage locker in a mini-storage compound. He left the locker carrying a paper bag. Canadian police subsequently entered that locker and found in it 105 bricks of heroin weighing approximately 70 kg. This person, Chan Chi Hang had met the respondent on 17 October 1998 at Vancouver Airport where the respondent had arrived in transit from Toronto. This was the day before the respondent flew to Hong Kong in respect of the present case.

40. On that day, 18 October 1998, Chan Chi Hang was observed to drive the respondent to Vancouver Airport. The respondent and Chan had left for the airport from Chan Chi Hang's home. About one month earlier, on 14 September 1998, Chan Chi Hang had been observed to drive another person to Vancouver Airport, that person was also booked on a flight to Hong Kong. After this person's luggage had been checked in at Vancouver Airport, it was searched secretly by Canadian police and his suitcase was found to contain a sum estimated to be at least CAN$500,000. I take this evidence into account as relevant to establishing a system of transportation of large sums of cash monies to Hong Kong from Canada, which system involved the person Chan Chi Hang who I accept was involved, in some way, in drug trafficking. It is far from strong evidence by itself but it is evidence I take into account in determining the nature of monies transported to Hong Kong involving, in some way, Chan Chi Hang.

41. The respondent's case is based upon his assertion that the source of the funds seized from him on 19 October at Chek Lap Kok Airport was from his own monies from his involvement in a family computer company and from his sister's borrowings and contributions.

42. I will deal with the respondent's evidence called in his case. That evidence consisted of his own two affirmations dated 14 September 1999 and 31 January 2000, the first of which annexed the affirmation of his father Lam Hin Loi dated 14 September 1999 and affirmed in Hong Kong. So far as that affirmation is concerned, I regard that as having complied with the requirements for the admissibility of affirmation evidence in Hong Kong proceedings and take it into account as evidence in its own right. The respondent's affirmation annexed also an affirmation made by his sister Wong Yee Wah, made in Toronto, Canada dated 7 September 1999, and I take that affirmation into account as well as source material or grounds for the contents of the affirmations of the respondent himself. The affirmation of Wong Yee Wah is not, in its own right, admissible otherwise as evidence in these proceedings.

43. In the respondent's affirmations, he said that he and his wife arrived in Canada in the early 1990s. By the year 1997, he claimed that he and his wife earned about CAN$350 each per week as wages. He apparently worked, over at least a large part of that time, in a company called Golden Dragon. In addition to his wages from his employment, he claimed also to have earned profits or bonuses from a company called P.C. Kit Limited and subsequently called apparently P.C. Kit Inc. ("P.C. Kit"), which was a computer company run by himself, his sister and his brother-in-law. He said that those profits and bonuses from that company were generally small. Annexed to his 14 September 1999 affirmation were a series of management accounts of P.C. Kit between the years 1995 and 1998. Those records showed the respondent's earnings from P.C. Kit between 1995 and 1998 inclusive totalled CAN$23,000 and that he withdrew invested capital of some CAN$60,000.

44. Over this time, as I say, he apparently earned also some CAN$350 per week from a company called Golden Dragon Computer Company or other similar name ("Golden Dragon"), though there was no business record of any such company or similarly named company operating in Ontario as claimed by the respondent. He said additionally to his wages from Golden Dragon and the profits or bonuses from P.C. Kit, he made money by lending to his friends to finance their gambling at a casino he frequented called the Rama Casino. No detailed evidence was provided by him as to his income from this activity.

45. He said in June or July 1998, his father, who was in Mainland China, asked him for HK$2-3 million so as to buy shares. For that reason, he took CAN$500,000 to Hong Kong in cash in July 1998. At that time he opened an account at the Hang Seng Bank and deposited that money in it. He said he then transferred this money to an account held by a person Tan Jian Ping ("Tan") who was a friend of his from Canada. Tan apparently operated that account in Hong Kong and conducted business in China. He said he then went into China in order to meet with his father. Tan's business associates in China then gave him the money that he had transferred into her account in Hong Kong. He said he lost most of that money as he took it with him to Macau and gambled a substantial portion of it away in a casino. He said he used most of the balance of the money to lend to others in Macau so as to be able to try and regain the losses he himself had made at the casino. Subsequently, he said, he was therefore unable to lend his father any of this money. So he returned to Canada. In his affirmations, he claims that he was and has continued to be unable to contact these people he lent the money to in Macau so as to recover any part of it at all.

46. I must say I find this version of events wholly unbelievable. The concept of the respondent losing these monies in this series of misadventures is simply worthy of no credit. I cannot accept that the respondent, having lost money in Macau at a casino, would then lend the balance of that very large sum of money to people within Macau who subsequently he was unable to contact. Apparently no security was given for these loans and no avenues were available to him to ensure the repayment of the loans or at least continuing contact with the people that he had lent the money to. I cannot place any credit on the respondent's description of this series of events. In my view, his evidence in this regard is simply to explain his earlier trip to Hong Kong with about half a million Canadian dollars in cash or travellers cheques and to use the facts of that incident as support for his later evidence concerning the bringing of the CAN$380,060 cash to Hong Kong some three months later.

47. So far as this evidence of the respondent's bringing of CAN$500,000 to Hong Kong in July of 1998 for his father's use is concerned, I take it into account only so far as it relates to the credibility of his evidence of having brought the CAN$380,060 seized on 19 October 1998 to Hong Kong for the same reason. I do not draw any adverse inference against the respondent or his case regarding any system of carriage of monies to Hong Kong or as to the source of those monies from that evidence. In my view it does not go far enough so as to allow any such inference.

48. The respondent says that after that failed July endeavour to take money to his father in China, that his father continued to ask him for money. The respondent says, in order to comply with his father's continuing request for money, he then went to his sister Wong Yee Wah to borrow more money and that she eventually was able to provide him with the sum of some CAN$280,000 to which he added CAN$100,000 of his own. The total monies then obtained by the respondent were CAN$380,060 and it was that sum that he brought to Hong Kong for the purpose of providing it eventually to his father in China. He said he brought it personally in the form of cash to Hong Kong because he believed that a telegraphic transfer of the money to Hong Kong would take two or three days if he remitted it from a Canadian bank. He says, also, in his evidence, that he did not want to have to bother to tell any such bank the source of the money. He says also that he thought his own bank account that he had opened in July with Hang Seng Bank in Hong Kong had been closed due to the reduction of the small sum remaining within it by bank charges.

49. In my view, these aspects of the respondent's evidence are equally incredible. Taking into account the sum of money that he had brought, or attempted to bring, to his father of some CAN$500,000 in July and the CAN$100,000 of the CAN$380,060 he brought to Hong Kong on 19 October 1998, the respondent has apparently managed to save, since his arrival in Canada, some CAN$600,000. He apparently achieved that in addition to partially owning some three houses or items of real estate in Canada, and did so on income which, even on the contents of his evidence in this hearing, could only be described as moderate. His evidence as to his earnings and income over the period of time that he had been in Canada is, to say the least, in parts confusing and contradictory.

50. From the Canadian income tax documentation produced in evidence in this hearing as grounds for the statements of fact as to the respondent's earnings contained within the evidence of DSI Cheung, it would appear that the respondent's income over the period of time he was resident in Canada was quite low. From the respondent's own evidence, albeit as I say vague and confusing, he had at no stage put himself forward as a man of any particular wealth. I can place no credit on his evidence that he saved CAN$600,000 in cash by October 1998. I place no credit on his evidence in that regard given his further evidence that those hard-earned savings that he had managed to put together were squandered by him in large part in the way he suggested in his evidence by gambling most of it away in Macau and lending the balance to people he simply later could not contact. In my view, the respondent's evidence in that regard is quite simply a fabrication.

51. Further, the respondent's reasons for bringing the money seized on 19 October 1998 to Hong Kong in his luggage and clothing rather than simply remitting it to Hong Kong are illogical at best. He says he thought his own account with Hang Seng Bank would have been closed by October 1998 due to the slow erosion of bank charges. But that account was only opened three months earlier and still had about HK$1,000 in it. I cannot accept that the respondent possibly thought that that account had been closed by the bank by October 1998. But even if he did, in my view, given his reliance on Tan Jian Ping in July 1998 and his transfer of some HK$2 million to her account in Hong Kong, that being the Hong Kong dollar equivalent of the CAN$500,000 he had brought to Hong Kong in July 1998, I can see no reason why he could not simply once again have relied perhaps upon Tan's account in Hong Kong into which to remit those monies rather than bring them personally in cash to Hong Kong. Perhaps more cogently the respondent's father, the person who was to receive the monies at the end of the day himself, had two operating bank accounts in Hong Kong at this time, one at HSBC, an Assetvantage account, and one with Po Sang Bank.

52. Given these circumstances, the difficulties, inconvenience and dangers involved in carrying large amounts of small denomination monies from Canada to Hong Kong, in his personal luggage and clothing, by any test of common sense renders implausible the respondent's version of events in this regard.

53. Even taking into account the contents of the affirmation of his father, and so far as the grounds for his own statements of facts are concerned, also the affirmation of his sister Wong Yee Wah, at the end of the day, I reject the respondent's evidence. In my view, the contents of his affirmations are fabrications rather than the truth as to the source of the monies he brought to Hong Kong on 19 October 1998. Further in my view the contents of his sister's and father's affirmations are in parts contradictory of the respondent's own evidence and I find them, taking the evidence as a whole, of no weight.

54. Having rejected the respondent's evidence, nevertheless, in my view, the applicant must still establish its case. I accept the applicant's evidence as contained in the affirmations of DSI Cheung. I accept that the evidence of DSI Cheung, so far as it extends beyond his own personal knowledge, is based upon particularized and reliable sources. I restrict DSI Cheung's evidence so far as I take it into account to expressions of fact. I ignore his occasional statements of law and his own assessments of the strength of the evidence and case against the respondent. I ignore also the occasional expressions by him of opinion as to the credibility of the respondent and the respondent's case.

55. From the evidence contained in the affirmations of DSI Cheung, I am satisfied that the CAN$380,060 seized from the respondent on 19 October 1998 at Chek Lap Kok International Airport represented the proceeds of drug trafficking. In my view, the high likelihood is that the monies did represent the proceeds of drug trafficking rather than any other unlawful or lawful activity.

56. The evidence which I find convincing in that regard includes the fact that a large part of that sum of CAN$380,060 was made up of small denomination banknotes. I accept the statements of fact of DSI Cheung to the effect that drug dealings at street level in Canada are on the basis of transactions involving small denominations of cash.

57. I take into account also the close contact between the respondent and Chan Chi Hang immediately before the respondent flew to Hong Kong on 18 October 1998. I am satisfied that Chan Chi Hang, from the evidence of DSI Cheung, was a person who was intimately involved with drug trafficking in Canada, and that that trafficking involved large amounts of heroin. I take into account also that Chan's involvement with drug trafficking in that regard occurred only a few weeks after he had taken the respondent and his luggage to Vancouver Airport for the flight to Hong Kong. I take into account also that Chan's brother Chan Kwok Yung was involved in a dangerous drug transaction in Canada some 18 months before the seizure of the present monies from the respondent at Chek Lap Kok Airport. At that time, Chan Kwok Yung was in a motor vehicle registered in the name of the respondent.

58. I accept also that following the release of the respondent by police after the CAN$380,060 cash was seized from him on 19 October 1998, a telephone call took place between Hong Kong and Canada involving at least a telephone used by Chan Kwok Yung. I am sure the evidence of DSI Cheung concerning the contents of that call is reliable. I accept the reliability of his sources in this regard so far as the telephone number involved being that of Chan Kwok Yung. I do not place any weight on the voice identification evidence asserted by DSI Cheung. In my judgment those grounds for his belief are not sufficiently reliable.

59. The balance of DSI Cheung's evidence establishes that shortly after the release of the respondent on 19 October, a phone used by Chan Kwok Yung in Toronto, Canada rang a telephone number in Hong Kong and a conversation occurred to the effect that a person Lin had been stopped at the airport and money had been taken from him. That, in my view, is sufficient to draw an inference that Chan Kwok Yung was connected with the monies which the respondent had brought to Hong Kong. That inference is by far the most probable arising from that evidence.

60. Taking all of these matters into account, including the method of bringing the monies to Hong Kong, I conclude that those monies originated from the associates of the respondent in Canada who were involved in drug trafficking.

61. It was asserted by Mr Percy that there was no proof that even if the monies were shown to have come from an unlawful source, that that unlawful source was drug trafficking as opposed to some other unlawful activity. In my judgment, on the balance of probabilities, the source of the money was drug trafficking. It is obvious that the associates of the respondent were involved on a very large scale with drug trafficking. The monies were in small denominations which were consistent with drug trafficking. The transportation of the monies occurred at a time whilst drug trafficking was an on-going activity amongst the associates of the respondent in Canada.

62. In my view, these factors taken together, even accepting that the associates of the respondent might have been involved in other unlawful activities in addition to drug trafficking, lead me to the inference that the sums of money at issue came from trafficking in dangerous drugs in Canada. In this regard, also, I take into account, though I accept that it is not strong evidence, that the vast number of banknotes seized were contaminated by cocaine. I say that evidence is not strong for the simple reason that I do accept the evidence presented on the part of the respondent that very many banknotes in circulation are contaminated by dangerous drugs. And I take into account also that the evidence in this case has been redolent with the associates of the respondent dealing particularly in heroin and the contamination found on the banknotes related to a different drug.

63. Accordingly, for the purposes of section 24D(1), I am satisfied that the CAN$380,060, being seized property, is presently detained under section 24C(3) of the Ordinance and so far as the present application pursuant to section 24D(1) is concerned, I am further satisfied on the balance of probabilities that that property in whole directly or indirectly represents the proceeds of drug trafficking of some person or persons in Canada. Accordingly, I order the forfeiture of the seized CAN$380,060. I might add that no particular argument was directed to me as to either section 24D(1)(b) or section 24D(1)(c), i.e. that the sum of money had been used in drug trafficking or was intended for use in drug trafficking. For that reason, I restrict my findings to section 24D(1)(a).