THE PRACTICE REVIEW COMMITTEE OF THE HONG KONG INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS v. LAM KIN CHOI

CACV 238/2017

[2018] HKCA 195

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 238 OF 2017

(ON APPEAL FROM THE DISCIPLINARY COMMITTEE OF THE HONG KONG INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PROCEEDINGS NO D-14-0963P)

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JUDGMENT

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Hon Lam VP (giving the Judgment of the Court):

1.  This appeal was brought by Lam Kin Choi against the decision of the Disciplinary Committee of 25 August 2017 [“the Decision”] under Section 33(3) of the Professional Accountants Ordinance Cap 50 [“PAO”]. By the Decision, the Committee found on the admission of Mr Lam that three complaints against him were established. The Committee imposed the following penalty on Mr Lam:

“ (1) The Respondent’s practising certificate be cancelled under section 35(1)(da) of the PAO and no practising certificate be issued to him for a period of 12 months under section 35(1)(db) of the PAO; both effective from the 42^nd day after the date hereof;

(2) Penalty of HK$20,000 to be paid by the Respondent to the Institute for the Complaints under section 35(1)(c) of the PAO; and

(3)  The Respondent shall pay costs and expenses of and incidental to the proceedings of the Complainant and that of the Clerk in the sum of HK$46,827 under section 35(1)(iii) of the PAO.”

2.  The order was made pursuant to Section 35(1) of the PAO.

3.  Section 41(3) of the PAO provides:

“ In any such appeal the Court of Appeal may exercise such powers as are vested in it by the High Court Ordinance (Cap. 4) and the practice and procedure shall be in accordance with rules of court made under that Ordinance:

Provided that the Court of Appeal shall not hear any such appeal unless notice of the appeal has been given by the appellant within 30 days after service upon him of—

(d) a copy of a decision under section 35(1).”

4.  By reason of the proviso, an appeal must be brought against the order within 30 days after the service of the order on Mr Lam.

5.  The order was served on Mr Lam on 30 August 2017.

6.  Notice of appeal was not served by Mr Lam before the statutory deadline.  According to the endorsement of service on the notice of appeal, Mr Lam sent the same to the Complainant by post on 25 October 2017.

7.  The matter came to the attention of the Registrar of Civil Appeals.  On 27 October 2017, the Registrar drew the parties to the time limit under section 41(3) of the PAO.

8.  In response, solicitors for the Complainant wrote on 12 January 2018 confirming that the appeal was brought out of time.  It further stated:

“ It would appear however that [Mr Lam’s] delay in lodging the Notice of Appeal was due to his misunderstanding of the relevant rules --- in this respect, we note that [Mr Lam] has purported to ‘appeal’ against the Decision by way of letter to the Complainant on 27 September 2017.”

9.  The letter in question was actually dated 26 September 2017, though received on 27 September 2017.  It was not in the form of a notice of appeal as required by Order 59 Rule 3 of the Rules of the High Court.

10.  The Complainant responded to the letter of 26 September 2017 on 12 October 2017 informing Mr Lam that he needed to file a formal application to the Court of Appeal in order to appeal.  The letter further said:

“ If we do not receive your Notice of Appeal within 14 days from the date of this letter, we will assume that you no longer intend to appeal and shall proceed with enforcing the sanctions imposed by the Disciplinary Committee on 25 August 2017.”

11.  That statement was made, obviously, without regard to the time limit in Section 41(3) of PAO. 

12.  In light of this state of affair, the court gave the following directions on 29 January 2018:   

(a) By reason of the proviso in Section 41(3) of the Professional Accountants Ordinance Cap 50, the Court of Appeal has no jurisdiction to entertain an appeal unless notice of the appeal has been given within 30 days after service upon the respondent the order of 28 August 2017 on 30 August 2017.

(b) Hence, the notice of appeal of the Respondent dated 25 October 2017 was served outside the permissible appeal period, as such prima facie ineffective and the appeal is prima facie incompetent.

(c) Unless the Respondent shall lodge with the Court and serve upon solicitors for the Complainant written submissions by 12 February 2018 attaching relevant authorities to show that the court has the power to extend the time for service of notice of appeal in an appeal brought under Section 41 and, if such power exists, explaining the reasons for granting an extension of time, the appeal shall be automatically struck out on 13 February 2018 as being incompetent without further order.

(d) If the Respondent shall lodge written submissions as directed, the Complainant may lodge submissions in response by 26 February 2018.

(e) After the lodging of submissions, the Court shall process the matter on the papers.

13.  In a letter dated 9 February 2018 (received by the court only on 12 February 2018), Mr Lam stated as follows:

“ Refer to your letter dated 29 January 2018, I am sorry to apply for the notice of appeal of Respondent dated on 25 October 2017 which was served outside the appeal period.

Basically, all the proceeding against me by the Society (HKICPA) was performed in the Society’[s] office. Since I am a Sole Proprietor’s practice. This is quite unfair to me of the determination and judgement since I have only one person to attend but our Society have 5 persons to attend the meeting.

At the final stage, I had unbelievable to get this bad result (See Appendix 1) on 28 August 2017. Since I have lack of the experience to apply for the “Appeal to the Court”. Therefore, I write the letter for my appeal to the Society’s office on 26 September 2017 (See Appendix 2)

Until 12 October 2017 (See Appendix 3), our Society reply and request me for the Notice of Appeal within 14 days from the date of this letter. After consulted with the Solicitor, I found I should apply for the formal notice from high court on 25 October 2017 (See Appendix 4). I believe that I have misunderstanding our Society’ proceeding procedure.

I sincerely hope that your department accepts my appeal to the court of appeal.  Thank you for kind attention.”

14.  The letter did not address the issue raised by the Court, viz whether the Court has jurisdiction to extend time.  Nor did it give sufficient reason for extension of time if the Court has the power to do so.  Though the letter of 12 October from the Complainant also overlooked the time limit, by the time Mr Lam received it the statutory deadline had expired. Thus, the letter of 12 October has no bearing on the mistake of Mr Lam way back in September 2017 in terms of serving a notice of appeal within the time limit under section 41(3).  

15.  Further, Mr Lam did not comply with the unless order of 29 January 2018 in that he did not serve copy of his letter of 9 February 2018 on the solicitors for the Complainant.

16.  Submissions were filed on behalf of the Complainant on 14 March 2018 contending that the appeal was struck out by reason of Mr Lam’s non-compliance with the unless order. 

17.  We agree with those submissions.  Due to his non-compliance with that order, the appeal had been automatically struck out on 13 February 2018 as being incompetent on the ground that it was not brought within time as per section 41(3) and Mr Lam did not make a proper application for extension of time despite the directions of 29 January 2018. 

18.  We also order Mr Lam to pay the costs of the Complainant in this appeal, such costs are to be taxed if not agreed.