HKSAR v. CHENG KAI MING CHARLES AND ANOTHER

CACC 96/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 96 OF 2010

(ON APPEAL FROM DCCC NO. 24 OF 2008)

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BETWEEN

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J U D G M E N T

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

1.  On 28 November 2012, we handed down a judgment in an application by five applicants to appeal a number of convictions in the District Court. The conviction with which the applications now before us are concerned are in respect of Charge 4 which was levelled against all applicants and asserted that they, knowing or having reasonable grounds to believe that property, namely HK$32 million in whole or in part directly or indirectly represented proceeds of an indictable offence, conspired to deal with that property. Part of our disposition of those applications was constituted by our dismissal of the appeals (we having granted leave) of the third and fourth applicants, Cheng and Li, who were D4 and D5 at trial, against the conviction on Charge 4.

2.  There are now before us two notices of motion, one on behalf of Cheng, the other on behalf of Li, each of which seeks a certificate under section 32(2) of the Hong Kong Court of Final Appeal Ordinance, Cap 484, that points of law of great and general importance are involved in our decision.

3.  The points for which certification is sought for Cheng are:

“(i) Does section 25 (1) of the Organized and Serious Crimes Ordinance (Cap 455) look at the source of the property rather than its intended use?

(ii) In section 25 (1) of the Organized and Serious Crimes Ordinance, Cap 455 does the phrase “property in whole or in part directly or indirectly represents the proceeds indictable offence” only include property that is derived from or generated from commission of an indictable offence?”

4.  The points for which certification is sought for Li are in similar vein:

“(i) Is section 25 (1) of the Organized and Serious Crimes Ordinance (Cap 455) a section which looks to the source of identified property and not its intended use?

(ii) Is it a defence under section 25 (1) of the Organized and Serious Crimes Ordinance (Cap 455) that the source of the proceeds is from a legitimate source and the proceeds may become tainted only after changing hands or going through a process of transfers involving the commission of an indictable offence?

(iii) Is fund (sic) provided to carry out an indictable offence ‘proceeds of an offence’ under section 2(6) of the Organised and Serious Crimes Ordinance (Cap 455)?”

5.  The relevant statutory provisions at play are set out at paragraphs 129 and 131 of our judgment and our statement of the issue of law and our analysis thereof may be found in paragraphs 141 to 162 inclusive.

6.  It seems to us that what the section in question looks to are “proceeds of an indictable offence” as defined by the statute and that the questions framed have insufficient regard to the factual matrix of the present case and the degree to which our analysis in relation to Charge 4 addressed that stage of the history of the matter after the commission of the fraud; that is to say, the fact of funds in Tsang’s account, an advantage obtained by him in connection with the prior conspiracy to defraud and then the subsequent dealing with the property which had been in Tsang’s hands in a manner designed to obscure the tracks of that prior offence.

7.  Against that background it appears to us to be inappropriate to certify the questions posed and the applications are rejected.