HKSAR v. TSANG YAM KUEN, DONALD

HCCC 484/2015
[2018] HKCFI 491

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO 484 OF 2015

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DECISION

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1.  The Defendant was convicted after the first trial of one count of Misconduct in Public Office on 17 February 2017 and sentenced to 20 months’ imprisonment. The Prosecution applied for an order of one third of the first trial’s costs in favour of the Prosecution with a certificate for three counsel, to be taxed if not agreed.

General Principle

2.  In support of their application, the Prosecution relied on section 12 of the Costs in Criminal Cases Ordinance (Cap 492) (“CCCO”):

“12. Prosecution costs for indictable offences

Where a defendant is convicted of an offence by or before the District Court or the Court of First Instance, the District Court and the Court of First Instance may, in addition to such sentence as may otherwise be passed by law, order that costs be awarded to the prosecutor.”

3.  The CCCO deals not only with the prosecution costs for indictable offences but also with summary offences.  Since most of the cases reported regarding prosecution costs relate to summary offences, it may be worthwhile firstly to look at section 11 of the CCCO which contains similar wording:

“11. Prosecution costs in summary proceedings

(1) Where—

(a) a defendant is convicted by a magistrate or a magistrate makes an order on complaint in respect of a defendant under the Magistrates Ordinance (Cap 227); or

....

 the magistrate may order that costs be awarded to the prosecutor.”

4.  Prosecutor is given a wide definition as “any person who lays an information or a complaint or institutes criminal proceedings.” in the CCCO. In other words, it is not confined to the Secretary for Justice but also includes public or statutory bodies, which are often given statutory power in enforcing their own regulations or by‑laws.  The obvious examples are the Mass Transit Railway Corporation and the Tate’s Cairn Tunnel Company Limited.

5.  Although criminal prosecution is normally instituted by the Secretary for Justice, an individual citizen may also bring private prosecution if he feels aggrieved by the decision of the police or the Secretary for Justice in refusing to investigate or prosecute.  In such circumstances, an individual citizen is likewise exercising a constitutional right, his right to assess the court.

6.  The CCCO gives the court a very wide discretion in awarding costs subject to the general principles laid down in section 15:

“15. General principles

In any criminal proceedings–

(a) the costs that may be awarded by virtue of an order shall not be punitive but shall be such sums as appear to a court or a judge reasonably sufficient to compensate any party to the proceedings for any expenses properly incurred by him in the course of those proceedings, including any proceedings preliminary or incidental thereto;

....

(c) an order as to costs shall be such as a court or a judge considers just and reasonable;

....”

On the face of the statutory scheme, it appears that the courts are intended to enjoy a broad discretion to award costs, after taking into account all relevant circumstances, which no doubt will include the strength of the prosecution case and the conduct of the defendant.  One can also discern from the above principles that the power to award costs includes not only costs incurred for the trial hearing but also any matters or proceedings preliminary or incidental to it.  In that sense, given the wide definition of prosecutor and the provision in section 15, it seems rather clear that costs incurred by enforcement agencies during their investigation are also recoverable.

7.  In this case, information was laid by the Chief Investigator of the Independent Commission Against Corruption (ICAC).  As such, any costs properly incurred by the ICAC can form part of the prosecution costs.  The only limitation is that it must be compensatory and not punitive in nature.  By that I take it to mean any sum over and above that which is reasonably incurred.

8.  In HKSAR v Chan Kwok Wah (1999) 1 HKC 697, Chan CJHC (as he then was) held that in order to protect the constitutional right of the defendants, convicted persons should only be ordered to pay the costs in special circumstances.  Special circumstances were considered to include among others, the Defendant’s conduct throughout the trial such as putting the prosecution to proof of insignificant matters or undeniable facts.

9.  The decision of Chan Kwok Wah was followed by Yeung J (as he then was) in HKSAR v Chan Kwok Hung [2000] 3 HKLRD 389.  Yeung J expressed that:

“.... this observation is not meant to be a strait‑jacket approach and an element of discretion or perhaps common sense is called for depending on the facts of each individual case.”

10.  Chan Kwok Wah was later approved by the Court of Appeal in HKSAR v Cheng Tak Wai (2002) 4 HKC 458, Mayo VP expressed as follow:

“What emerges from this is the necessity for it to be established that there is some feature of the trial indicating that as a consequence of the way in which the defendant conducted his defence unnecessary or additional expenditure has had to be incurred by the prosecution or that the defendant has wilfully wasted the court’s time.”

11.  In that case, the Court of Appeal seems to proceed on the basis that a costs order was punitive in nature without giving any reasoning.  In giving judgment of the Court, Mayo VP said:

“Notwithstanding the Judge’s view that an order for the payment of the prosecution’s costs was not part of the punishment imposed upon the applicant, it is difficult to avoid coming to the conclusion that that was exactly what it was.”

I do not believe the mere fact a person is required to pay the prosecution costs can be equated with a penalty for if that be the case, there is no point in enacting section 11 or 12.  However, the effect of a costs order may well be punitive given the fact that the defendant would inevitably be worse off financially.

12.  This court, of course, is bound by the decision in Cheng Tak Wai.  Bearing in mind the compensating nature of a costs order and applying the principles laid down in Chan Kwok Wah, I come to the view that the way the Defendant conducted himself towards the investigation and prosecution in the present case warrants the imposition of a costs order.

The Conduct of the Defence Case

13.  After the revelation of his private trips to Macau by the media in February 2012, the Defendant made a number of public statements emphasising that he would fully co‑operate with the ICAC in its investigation.  In the “Beautiful Sunday” programme on 26 February 2012, the Defendant, as the Chief Executive of the HKSAR, said the following:

“.... some people said that I have to, er, have to report to the ICAC. I fully understand this. I will definitely and fully cooperate if it is really to be done. No contact has been made with me yet, but I will fully cooperate to go through this so that everyone, everyone will calm himself down, clear of such worries and doubts.

....

I think that there are good procedures in Hong Kong.  I am very, very happy to do that because I personally think that I am, at least I myself, in respect of law, I have not treated unfairly .... unfairly, and there isn’t, no exception has been made.  The only problem is to relieve, relieve the suspicion of the general public, I am definitely willing – willing to cooperate.”

14.  On 1 March 2012, the Defendant, as the Chief Executive of the HKSAR, informed the Legislative Council:

“.... Criticisms have kept emerging everyday on all fronts. I have reflected over the whole thing, trying to figure out why the mass media, Honourable Members and the general public all find such accusations believable.

....

Honourable Members, whether you still trust me, you must never lose confidence in Hong Kong’s system. I give you my word whether in the review of the regulatory system or the investigation by the Independent Commission Against Corruption (ICAC), I shall invariably render my best possible co‑operation.

....

To date, the ICAC has not approached me for any enquiry. I assure Honourable Members that if it does so, I will render my full co‑operation and will not interfere with the investigation.

....

As I said just now, I will co‑operate fully with the ICAC in its follow‑up work. .... Anyway, I have already promised Honourable Members that I will definitely render my full co‑operation.”

15.  Between February 2012 and June 2012, the Defendant rendered no assistance to the ICAC during the remainer of his term as the Chief Executive.  When the Defendant was approached by the ICAC in October 2013, he exercised his right of silence.  Despite his repeated assurance to the public as the Chief Executive that he would render full co‑operation to the ICAC, he gave no assistance whatsoever.

16.  When the ICAC was established in 1974 under the Independent Commission Against Corruption Ordinance, the Commission was known in Chinese as “總督特派廉政專員公署”.  Its name in Chinese was not a direct translation of its name in English.  The difference was made, in all likelihood, to impress upon the vast majority of the local Chinese citizens that the Commission was a trustworthy organisation which reported to no one except the Governor; the Commissioner was not only independent but specially appointed or commissioned by the Governor and citizens were asked to report corruption to the ICAC with the strict confidence that it would investigate their cases fairly and thoroughly.

17.  After the handover in 1997, although its name in Chinese has been changed in that it is no longer specially appointed or commissioned by the Governor or “總督特派”, the mission of the ICAC has remained the same.  The Commissioner remains to be appointed by the Chief Executive and reports to him only.  Further, Article 47 of the Basic Law demands the Chief Executive to be a person of integrity, namely a man of his own words, the only public official in our constitutional framework with such a requirement. As the Defendant said in the Legislative Council on the 1 March 2012:

“We must all appreciate that the ICAC itself has already become a core value of Hong Kong people. The people there always perform their duties faithfully.”

18.  Yet when it came to the Chief Executive himself being investigated, his attitude was far from co‑operative.

19.  In the course of his various statements to the public in February 2012, the Defendant claimed to have leased the Shenzhen property and paid a sum of RMB800,000 to the landlord, yet he produced no lease or supplemental agreement or rental receipt.

20.  When the ICAC approached the Defence for a copy of lease and relevant payment record in respect of the Shenzhen property, the Defence did not provide any.  It was not until the ICAC had made known to the Defence that it had all the necessary power to search and seize such documents that the Defence decided to produce.  When they were provided to the ICAC on 26 September 2013, no explanation was given as to when these documents were created.

21.  The Defendant was interviewed under caution by the ICAC in October 2013.  He remained silent and offered no explanation concerning the property or his relationship with Mr Wong Cho Bau, Mr Albert Cheng or Mr David Li.

22.  The evidential value of these documents are worth nothing on their face, as they were misleading and full of contradictions and discrepancies. The most notable discrepancy was the amount of rent in words and in figures.  The Defendant’s wife who was one of the signatories to the lease refused to sign and confirm her witness statement to the ICAC.  It was put forward by the Defendant that spousal privilege under section 6 of the Evidence Ordinance was applicable in the Defendant’s case.  As a matter of law, section 6 applies to testimonial privilege only.  Once they were produced, the Defendant did nothing to explain them or dispel the misleading impression created by their production.  As a result, the ICAC had to conduct further investigation into the alleged payment of rent.  It was then discovered that no rental payment had been made in 2012.  The only payment made was back in 2010 in the sum of RMB800,000.  Again, no explanation was given as to why it was made as early as 2010.  The rhetorical question one wishes to ask is: wouldn’t it be better to keep this sum in one’s own RMB account as long as possible for evidence indicated that both the exchange rate and the interest rate for RMB were on the rise in those years?

23.  The absence of any explanation inevitably caused the ICAC to probe further into the Defendant and consequentially his wife’s financial situation.  The in‑depth financial investigation uncovered the Defendant and his wife’s financial dealings with other people such as Mr David Li and Mr Wong Chor Biu, both shareholders of Wave Media Limited.  In fact, it took the ICAC over two and a half years to complete all the fund flow investigation.  Undoubtedly, the time and effort spent were huge.  When it came to the first trial, the Defendant only admitted all the financial transactions after the formal bankers’ affirmations, had been served as additional evidence.  The authenticity of all the banks statements and financial transactions were never challenged during the first trial.  In reality, they were all undeniable facts.

24.  In front of the media outside the Eastern Magistrates’ Court on 5 October 2015, the Defendant stated that in the past three and half years he had rendered full co‑operation to the investigation of the ICAC.  That seems to be very far from the truth.

25.  As a result, an enormous amount of time and manpower had been put into the investigation unnecessarily on undeniable facts. As pointed out by the Prosecution, the present application is not based on the fact that the Defendant chose to exercise his right of silence as he is entitled to, rather, it is based on the totally unnecessary costs which the taxpayer had to pay.

26.  Apart from the financial transactions, the corporate structure of the Shenzhen East Pacific Group Limited was also not admitted.  In particular, the Defendant refused to admit that Mr Wong Chor Bau was the Managing Director of Shenzhen East Pacific Group Limited.  This was despite the Defendant’s assertion in the Beautiful Sunday programme that he had been in discussion with Mr Wong Chor Bau in 2010, and that Mr Wong Chor Bau had mentioned to the Defendant the club house at East Pacific Garden and explained his plan to renovate it.

27.  In addition, the Defendant also refused to admit the fact that the announcement was issued by the Shenzhen East Pacific Group Limited on various newspapers.  Following argument and ruling on the subject, the Prosecution informed the court that it was in the process of obtaining evidence to link the announcement with the Shenzhen East Pacific Group Limited.  Search warrants were obtained and executed on 9 and 11 January 2017 against Sing Tao News, Lane Fung Advertising and Public Relation Limited and Link Work Communications (HK) Limited.  It was not until then that the Defendant finally agreed.  These were, in my view, insignificant matters that the Prosecution were required to prove.

28.  Prior to the first trial, the Defendant also indicated to the court that an application in relation to count 2 under section 16 of the Criminal Procedure Ordinance would be made.  It proceeded on the basis that there was no evidence disclosed in the committal papers which established the necessary duty to disclose, or not to conceal, matters in the Executive Council meetings and that none of the Codes of Conduct contained in the committal papers were applicable to the Chief Executive.  Although the application was subsequently withdrawn, it resurfaced in another application to exclude.  This court rejected the defence argument as to the exclusion the Code for Principal Officials of under the Accountability System and Civil Service Bureau Circulars.  They were clearly relevant.

29.  Given the above, I am of the view that there are special circumstances in this case that warrant the imposition of the costs order against the Defendant.  Enquiry has been made to ascertain the total costs of the prosecution case and the Defendant’s ability to pay.  The total prosecution costs for the first trial was estimated to be in the region of HK$15 million.  The Defendant has a substantial amount of cash in his bank accounts and has been receiving pension payments after his retirement as the Chief Secretary.  In summary, the Defendant is in a position to pay the costs.  As such, it is ordered that the Defendant pays one third of the total prosecution costs in respect of his first trial, to be taxed if not agreed, with certificate for three counsel.

Discharge of Juror in Second Trial

30.  In the second trial, application was made by the Prosecution to discharge Mr Kiu, a juror from the jury service towards the end of the proceedings. After listening carefully to submissions from both sides, I allowed the application and indicated that I would give my full reasons.  These are my reasons.

31.  In the course of my summing up, the court was informed by the Prosecution that Mr Kiu during the lunch adjournment, was seen to approach one of the Defendant’s supporters, Mr To Kit (陶傑), a popular columnist and radio presenter for conversation and photograph, who had publicly supported the Defendant in these proceedings.  The court was further informed that Mr To Kit expressed on social media antipathy towards the Prosecution and also to a degree to the Judiciary and that he had made clear his views about the merits of the case.

32.  On the day in question, Mr To Kit was brought into court by one public relations representative, unlike ordinary citizens who had to queue up for seats.  He then sat in an area exclusively reserved for the Defendant’s family and friends.  In fact, this was not the first time Mr To Kit had come to court.

33.  Following the procedure in the investigation of any alleged misconduct of juror as set out in the English Criminal Practice Direction, Mr Kiu frankly admitted before the court that he was a follower of Mr To Kit’s radio show and that he had been listening to his programme for many years.  However, Mr Kiu told us that his conversations with Mr To Kit were confined only to casual matters.  Given the late stage of the proceedings, the Prosecution applied to the court to exercise its discretion to discharge Mr Kiu only on the basis that there was a potential bias.

34.  The House of Lord in Porter v Magill [2002] 2 AC 357 considered the question of bias in relation to the court generally and approved the test.  In the case of potential bias, the court should consider whether a fair minded and informed observer could conclude that there was a real possibility, or real danger (the two being the same), that the tribunal was biased.  This test was applied by the Court of Appeal in R v Poole [2002] 1 WLR 1528.  In Szeypusz v UK [2010] ECHR 1323, the European Court of Human Rights said that the impartiality of a jury must be subjectively and objectively beyond doubt.

35.  Mr To Kit expressed his view on social media regarding the prosecution of the Defendant (which counsel for the Defendant had made no attempt to deny).  Mr Kiu sought out a known supporter of the Defendant.  As such, Mr Kiu was a supporter of the Defendant’s supporter.  In my view, the seeking out of Mr To Kit raised a real possibility that Mr Kiu could not be fair minded in the way that he approached the case.

36.  The discharge of Mr Kiu led me at that stage to realise, for the first time, that public relations firm or consultant had been involved in this trial.  In fact, they had been present, constantly in and out of court, throughout the first and the second trial but I was not aware of their identities at the time as every citizen was entitled to observe the proceedings.

37.  At the outset of the second trial, there was legal argument on whether the Defendant was entitled to adduce good character evidence.  Such evidence was elicited in the first trial through the cross‑examination of witnesses called by the Prosecution, for example his former Cabinet Secretaries during their cross‑examination by counsel for the Defendant.  They spoke highly of the Defendant and I had no problem with that as that was the Defendant’s entitlement in his first trial.  He had a good reputation then and more importantly he was presumed innocent until proven guilty.  However, the situation changed.  Since the Defendant had been convicted, albeit of one count only, he was no longer entitled to have any good character direction from the court.  Had the Defendant decided to introduce good character evidence, the Prosecution would be entitled to introduce evidence in rebuttal.  The law on this is clear.  Mr Selwyn Yu SC, counsel for the Defendant in the second trial, quite rightly accepted that that was the law and that no such evidence would be adduced on behalf of the Defendant.

38.  Family and friends of any defendant in a criminal trial are perfectly entitled to be present in court to observe the proceedings and to show their support.  What is not permitted is for family and friends, or for that matter any other person, to try and exert any influence on the jury.  Jury tampering is not permitted because it undermines the basic foundation of our criminal justice system as that interferes with the due administration of public justice.

39.  Prior to both the first and second trials, the Defendant through his solicitors sought approval from the court to reserve exclusive seats for his family and friends.  His request was acceded to by the court.  Throughout the second trial, especially towards the end, former colleagues of the Defendant, for example, his former Financial Secretary and former Secretary for Justice, past Legislative Councillors from the Democratic Party, present Legislative Councillors from the Democratic Alliance for the Betterment and Progress of Hong Kong and prominent religious figures, were taken into the court on different days by the public relations firm or consultant sitting at the exclusive area, similar to Mr To Kit’s situation.  The objective was undoubtedly to inform and impress upon the jury that the Defendant was a good person and had support from people across the whole spectrum of the society.

40.  The Defendant in this case, knowing that good character evidence cannot be introduced from witnesses testifying for the prosecution, had decided to introduce such evidence through the back door.  There was of course no direct evidence suggesting the public relations firm or consultant had been engaged by the Defendant himself, the inference however was overwhelming and it would be an affront to common sense to conclude that there was not some consent, acquiescence or involvement by the Defendant.  Had the engagement of public relations firm or consultant been brought to my attention earlier, I might consider discharging the entire jury.

41.  In England, there are specific provisions in the Criminal Justice Act 2003 which allows judge only trial on indictment where there is a danger of jury tampering.  In Hong Kong, no equivalent provisions exist in our statute books, it may be high time for giving serious consideration to that.  There is however nothing to prohibit the case from being transferred to the District Court for trial.

42.  The present scenario is not much different from any case where a defendant has asked his friends or followers, whom not knowing the underlying reasons, to come to court, wearing black clothing and sitting in the public gallery, with the objective of intimidating either the witness or the jury.  In such a situation, the court will have no hesitation in excluding all these people.  Having said that, I wish to emphasise that there is no allegation against any persons who were brought into the court by the public relations firm or consultant and for that matter Mr To Kit.

43.  It came therefore with no surprise that in recent years, when the wealthy and powerful were charged for criminal offences, they tried all kinds of means and ways to list their cases in the High Court before a jury.  The involvement of public relations firm or consultant in our criminal proceedings is not only undesirable but may perceive as seeking to influence the jury.  It does nothing good to the rule of law in Hong Kong.  This serves as a warning to all public relations firm or consultant.