CHANDRU THANWARDAS MIRCHANDANI V. THE ATTORNEY GENERAL

1992, No. MP 2410

IN THE SUPREME COURT OF HONG KONG

MISCELLANEOUS PROCEEDINGS

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J U D G M E N T

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1. The Applicant is seeking Judicial Review of the decision of the Director of Legal Aid to refuse him legal aid for prosecuting an appeal against his conviction on 35 counts of charges involving uttering forged documents and false accounting.

2. For the purposes of this application perhaps the most significant aspect of the said criminal proceedings were the observations made by O'Connor J. on passing sentence. He said that the Applicant had obtained just over $92 million from various Banks and that while some of the moneys had been recovered $82.5 million remained owing to the Banks.

3. Various applications have been made by the Applicant concerning the Director's refusal to grant Legal Aid.

4. On the 21st July 1992 he made an application to the Court of Appeal for the Director's refusal to be set aside on the grounds that it infringed the Hong Kong Bill of Rights Ordinance Cap. 383. This application was dismissed and a judgment giving reasons for the dismissal was handed down on the 28th July 1992.

5. Put very shortly the Director has not been disposed to simply accept the Applicant's statement on affidavit that he had no assets available to him. The position of the Director is very helpfully set out in Mrs. Pritchard's affirmation made on the 27th January 1993. She says at paragraphs 6, 7 and 8 :-

"6. The Director has always faced great difficulties in determining the Appellant's means because of his lack of disclosure evasions and at times lies. For example his disclosure to David Brettell on 25th May 1988 of assets in Japan and Paris followed on the 24th June 1988 by a denial to Ms Fanny Fung that he had such assets. Further his constant averment that he has never been told the reason for discharge/refusal of legal aid. As a hearing was pending, and in an yet another attempt to clarify matters, I wrote to the appellant on the 15th January 1992 summarising details of the various applications for legal aid and the subsequent discharge/refusals. I received a reply dated the 23rd January 1992 which did not, in my opinion, address any of the matters raised and certainly contained a number of lies, for example para. 7 - "what else was required was never raised" - the interview notes show that there had been discussions about the disappearance of between $100M - $150M and about the very existence of the bank accounts in Singapore. There is now produced and shown to me copies of a bundle of three letters dated the 15th, 23th and 27th January 1992 between myself and the Appellant and marked "DMP-3".

7. In considering the Appellant's application in issue, I took into account certain facts which had emerged over the period of time the Appellant has had dealings with this Department, inter alia :-

(a) he has had at his disposal $2M cash over a number of years;

(b) he has had the means to pay for private representation when he required it;

(c) he had the means to pay for private medical treatment;

(d) he was unable or unwilling to explain where some $82.5M paid into his private accounts has gone to;

(e) he lied about the existence of the accounts to this Department.

There is now produced and shown to me marked exhibit "DMP-4" copy of the notes I prepared on 20 July 1992. These notes were intended for the assistance of the officer dealing with the file during my annual leave which set out the matters I considered when reaching a determination of means.

8. When the Appellant's application came before me for consideration, I noticed that he still had not made any disclosure or given any explanation of the various assets which he once had had. As I was unable to make a determination of his means or financial resources, I had no option but to refuse his application on 16 July 1992. I was, and still am, of the view that the question of the exercise of the Director's discretion under rule 15(2) does not arise until an assessment of financial resources has been made. Without making such an assessment, it would be impossible to determine the maximum contribution of the aided person under the new rule 16(3)."

6. During the course of his submission before me the Applicant spent most of his time in attempting to refute the allegations made by Mrs. Pritchard.

7. Clearly this application is not an appeal against the Director's refusal to grant Legal Aid to the Applicant. It does not therefore appear to me to be fruitful or helpful for me to attempt to enter into the arena and make a determination whether the appeal should succeed on its merits. This would only be a relevant exercise if the Applicant was able to establish that the Decision was so irrational as to be 'Wednesbury' unreasonable. On the facts before me this clearly cannot be the case.

8. What I am concerned with is whether the Director has exercised her discretion in the correct manner.

9. When the Applicant applied for leave to proceed with this Judicial Review Rhind J. refused the application. This refusal was the subject of a successful appeal and Fuad J.A. who delivered the main judgment had this to say at p.5 of the judgment :-

" In my judgment, without going into the matter in the depth which would be inappropriate at this stage of the proceedings, notwithstanding the helpful submissions urged upon us by Mr. Kwok, this is a case which, on the material now before us, raises an arguable case for the review of the Director's decision of 16th July 1992. The true construction of rule 15(2) in not free from difficulty. In my view it is necessary and desirable for a court to determine whether or not the interpretation of the rule put forward in paragraph 8 of the affirmation is correct, for if it is not, then the Director would have circumscribed the discretion given by that rule in a manner not provided for by the rule-making authority."

10. Fuad J.A. was referring to para. 8 of Mrs. Pritchard's affirmation which I have earlier cited and to Rule 15(2) of the Legal Aid in Criminal Cases (Amendment) Rules 1992. Rule 15 of the Rules provides :-

"15(1) Subject to paragraph (2) the Director shall assess the financial resources of each applicant for legal aid in accordance with the Legal Aid (Assessment of Resources and Contributions) Regulations as if the applicant were a person applying for legal aid under the Legal Aid Ordinance, and those regulations shall apply accordingly.

(2) The Director may, if he is satisfied that it is desirable in the interests of justice, grant a legal aid certificate or an appeal aid certificate to an applicant notwithstanding that on an assessment under paragraph (1) he determines that the applicant's financial resources, in the case of legal aid to which section 5 of the Legal Aid Ordinance (Cap. 91) applies, exceed the amount specified in that section."

11. With the greatest respect I consider that Fuad J.A. has very conveniently and succinctly encapsulated the issue which arises on this Judicial Review.

12. Before hearing this appeal the Court of Appeal sought reassurance from the Respondent that in making the decision to refuse Legal Aid the Director had taken cognisance of the amendment to the Rules made in 1992. The reason for this was that prior to the enactment of the amendments there was no discretion reposed in the Director to grant Legal Aid if he was not satisfied that a relevant Applicant came within the prescribed financial criteria.

13. Mrs. Pritchard was able to give such confirmation. She did so in paragraph 5 of her said affirmation.

"5. At the time the application was considered by me, I was fully aware of the legislative changes to the statutory criminal legal aid scheme which came into operation on 1 July 1992. Aside from the new financial basis for the determination of eligibility for assistance, I was also aware of the provision of the new rule 15(2) of the Legal Aid in Criminal cases (Amendment) Rules 1992 which gives the Director of Legal Aid a discretion to grant legal aid if he is satisfied that it is desirable to do so in the interests of justice even though an applicant may have failed on the test of his financial capacity."

14. It is evident from this paragraph that Mrs. Pritchard did make the decision to refuse Legal Aid with the full knowledge of the latest amendment to the Rules.

15. The next question which has to be considered is whether on the basis of the reasons given by Mrs. Pritchard for her refusal she approached the problem in the correct manner. Was it right for her to decline to consider the exercise of the discretion in Rule 15(2) before she had satisfied herself concerning the financial resources of the Applicant.

16. I have no doubt that this was the correct approach. The whole scheme of the substantive Ordinance is based on the premise that Legal Aid is made available to persons of limited means.

17. Where in a case such as the present one the Director has scrutinised evidence made available to him and is not satisfied with the explanations given by an Applicant it must surely be open to him on considering the merits of the application to take cognisance of the financial resources which may be available to the Applicant.

18. Indeed I accept the validity of the very helpful submission made by Mr. Kwok for the Respondent that the correct approach of the Director would be to first make the assessment required by Rule 15(1) and only go on to consider the discretion exercisable in Rule 15(2) if satisfied that there had been a satisfactory disclosure of information. Having regard to manner in which the Legal Aid legislation is framed I do not see how the Director could conscientiously discharge his responsibilities and be satisfied that the interests of justice would be served unless he had sufficient knowledge of the financial circumstances of the Applicant.

19. The present case would seem to me to be a good example of the sort of case where the financial circumstances of the Applicant are highly relevant in determining whether or not the discretion in Rule 15(2) should be exercised. If it is true that the Applicant may have secreted assets with a view to frustrating his numerous creditors it would surely be singularly inappropriate that the cost of his legal representation should be defrayed from the public purse.

20. For the reasons I have given I dismiss this application. I make an Order Nisi that the Respondent is to have his costs.