HKSAR v. Nanik Dayaram and Another

FAMC No. 7 of 2017

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 7 OF 2017 (CRIMINAL)

(ON APPLICATION FOR LEAVE TO APPEAL

FROM CACC NO. 274 OF 2015)

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BETWEEN

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REASONS FOR DETERMINATION

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Chief Justice Ma (giving the judgment of the Court) :

1.The Applicants seek leave to appeal to the Court of Final Appeal on the ground that a substantial and grave injustice[1] has been done to them.  After a trial which lasted from 18 May 2015 to 11 August 2015[2] in the Court of First Instance, the Applicants were convicted[3] of 9 counts of conspiracy to defraud and sentenced to 10 years’ imprisonment.  Their appeal to the Court of Appeal[4] was dismissed.

2.After hearing leading counsel for the Applicants,[5] we dismissed the application with the reasons to be handed down in due course.

3.The facts of the conspiracy to defraud are contained in the judgment of the Court of Appeal but essentially consisted of applications to various banks made by the Applicants (on behalf of companies controlled by their family) for import and export loans.  The allegation was that the sales (in the case of import loans) and purchases (in the case of export loans) made by the said companies were fictitious, and false documentation was utilized for the purposes of obtaining the advances made by the banks.  The net loss to the banks was calculated to be in the region of $200-250 million.  The prosecution case relied on establishing the absence of genuine documentation such as invoices, correspondence between buyer and seller, bills of lading, packing lists and other relevant information.

4.One of the grounds of appeal before the Court of Appeal (indeed the principal ground) was the assertion that the trial was rendered unfair following a number of interventions by the trial judge during the course of the evidence of various witnesses, in particular the 2^nd Applicant.  In the appeal, the Court of Appeal was taken through many pages of transcript.  As mentioned above, the appeal was a long one lasting some 3 days.  In the 98 page judgment of the Court,[6] some 75 pages (at least) are devoted to this ground of appeal.  We emphasize the above so as to underline the diligence and painstaking way in which the Court of Appeal undertook their task.  Each alleged intervention by the trial judge was analyzed in close detail before a conclusion was reached in relation to each complaint.

5.As has been reiterated time and again, the Court of Final Appeal does not sit in criminal cases as a second court of appeal where it merely deals with points run (or which should have been run) before the Court of Appeal.  In other words, the Court of Final Appeal does not go through the same exercise as the Court of Appeal.  Under the substantial and grave injustice limb of s 32(2) of the Ordinance, it is only in those rare and exceptional cases where there is a danger that something so seriously wrong has occurred such that a substantial and grave injustice has occurred when the Court of Final Appeal will intervene.  A number of cases make this point; it suffices to refer to those authorities relied on by counsel[7] in the Respondent’s written submissions : Kwok Hung Fung v HKSAR[8] and So Yiu Fung v HKSAR.[9]

6.Further, it should not be forgotten that regard must also be paid to the views of the Court of Appeal.  Where the Court of Appeal has reached a conclusion on a matter eminently suited for determination by that court and that such conclusion is “viable”, it would be highly unlikely that leave to appeal will be granted : see Lam San Yau v HKSAR.[10]

7.Analyzing the question of judicial interventions by a trial judge and reaching a decision as to whether the fairness of the trial has been compromised are matters eminently suitable for determination by the Court of Appeal.  In our view, the conclusions reached by the Court of Appeal in the present case are “viable” to put the matter at its lowest.  No real error of law has been advanced by the Applicants. Indeed, it is clear from the authorities contained in the judgment of the Court of Appeal that the applicable principles were borne firmly in mind.  This is therefore not a case in which leave should be given so that the same exercise undertaken below ought to be repeated before the Court of Final Appeal.  As Mr Marash SC confirmed, much the same arguments before the Court of Appeal were advanced by him before us.

8.It is not necessary to go through each point advanced by counsel.  They have all been extensively dealt with in the judgment of the Court of Appeal.  That said, we should perhaps just deal with a number of points that were highlighted to us during counsel’s submissions.  These relate principally to instances of interruptions where the Court of Appeal agreed that the trial judge had gone beyond what was permissible.

9.First, an issue arose as to the contents, or more accurately the lack of them, contained in computer servers found at the premises of the relevant companies. This went to the point that there was insufficient documentary proof of the genuineness of the transactions underlying the applications for the import and export loans.  The companies’ computers were an obvious place for relevant details to be recorded.  The defence case appeared to be that sufficient information was to be found in the computer servers.  In the course of the 2^nd Applicant’s testimony, the trial judge interrupted by putting to him what a witness for the prosecution had previously said regarding what he saw when examining the servers of the computers in question.  A number of criticisms were levelled at the judge including :-

(1) the fact that the judge did so in a confrontational manner;

(2) questions were put by the judge to the 2^nd Applicant which proceeded on a wrong factual basis;

(3) when defence counsel sought to raise an objection, he was told to sit down; and

(4) the way the judge questioned the 2^nd Applicant effectively suggested to the jury that he was a liar.

10.The Court of Appeal was of the view that the judge’s intervention was not justifiable.  Nevertheless, it concluded that no unfairness in the trial resulted.  It said this :-

“106. As we have said, we are satisfied that the judge ought not to have intervened, either in examination-in-chief or in cross‑examination, during the 2^nd applicant’s testimony relevant to the issue of Days’ computers.[11] He ought to have waited to see if the matter was resolved by questioning by counsel. That was their role, not his role. Further, he compounded the error of making such interventions by asserting, incorrectly on occasions, the effect of the evidence. Nevertheless, we are satisfied the 2^nd applicant was not impeded in his ability to present his defence case. Also, we are satisfied that the judge’s interventions did not have the effect of evidencing disbelief in the defence case. Finally, we are satisfied that they did not render the trial unfair.”

11.Having gone through the same materials as the judge, we are not persuaded that this conclusion was wrong.  We add this.  Some of the questions by the judge did (as the Court of Appeal accepted) proceed on the wrong factual basis, but this factual basis was, for whatever reason, largely shared by defence counsel at trial.[12] In any event, the witness was not impeded in giving his testimony; as the Court of Appeal noted, the 2^nd Applicant continued to give his version of events notwithstanding the judge’s interventions.  He was “in no way daunted in giving the evidence on the issue that he wished the jury to hear.”[13]  Any error, if it was material, could and should have been corrected on numerous occasions at trial, if it was felt necessary to do so.  In addition, we do not accept that the judge’s questions suggested that the 2^nd Applicant was a liar.  The judge was clarifying aspects of his evidence which required clarification, albeit (as the Court of Appeal held) he ought not to have intervened in the way he did.

12.Before us, Mr Marash SC sought also to argue that the effect of what the judge did led to an unfair summing up to the jury.  This was on analysis the same point regarding fairness.

13.The second part of the judge’s interventions attracting criticism by the Court of Appeal again occurred during the 2^nd Applicant’s testimony.  The 2^nd Applicant was dealing with the issue of whether the seller of products to the companies (the subject matter of the import loans) was a genuine seller (the prosecution case being that it was not, the Applicants’ case being that the seller was a genuine one).  The judge intervened by confronting him with the evidence of a prosecution witness and asked whether the 2^nd Applicant was effectively suggesting that the other witness was a liar.

14.The Court of Appeal agreed that it was inappropriate for the judge to have interrupted but concluded as follows :-

“80. Although, as we have said, it was a wholly unwarranted intervention of the judge to interrupt examination-in-chief of the 2^nd applicant and to suggest to him that the effect of his evidence was that Mr D’Silva’s evidence was made up or fabricated, nevertheless it is clear that was a part of the 2^nd applicant’s case, in particular in respect of Mr D’Silva’s evidence of transactions with the 2^nd applicant at 4:25 p.m. We are satisfied that this intervention did not in any way undermine the defence case or prevent the 2^nd appellant from adducing the evidence he wished to put before the jury. Moreover, it did not misrepresent the defence case.”

Again, we detect no error in this conclusion.  Mr Marash SC argued that the defence case had been merely to question the witness’s reliability, not his credibility (in the sense that he was not telling the truth).  With respect, this is not how we would characterize the approach of defence counsel at trial.  We agree with the Court of Appeal that attacking the credibility of the witness was very much the Applicants’ approach.  As the Court of Appeal noted,[14] in his closing speech, defence counsel said this :-

“ Presume is not evidence. I’m not going to leave it at that. You may find that D’Silva is not reliable, or you may find that you reject his evidence entirely as not credible for three reasons:” (Emphasis added in the CA Judgment).

15.Thirdly, Mr Marash SC also placed particular emphasis on another intervention by the judge during the testimony of the 2^nd Applicant and it was said that this resulted in his being prevented from giving relevant evidence.  When the 2^nd Applicant gave evidence regarding the difficulties (largely time constraints) encountered by the Applicants in going through large amounts of documents (some 524 boxes of documents),[15] the judge intervened by questioning counsel on relevance.  Not being satisfied with the answer given by counsel, the judge ordered this line of questioning to cease.  The Court of Appeal said this :-

“121. No complaint was made to the judge in those pre-trial reviews or at the commencement of the trial of any difficulties encountered by the applicants in inspecting material in the possession of FTI, in particular difficulties caused by the conduct of the staff of FTI.

…..

123. It is to be noted that, for his part, the 1^st applicant made no complaint of the defence being under “constant pressure from FTI” in the course of the inspection of the material in the possession of FTI. As Mr Blanchflower acknowledged, the alleged pressure from FTI was not a matter that was canvassed with either of the two witnesses called from FTI, nor were they asked if they were aware of the mechanics of the inspection process. So, the issue of pressure being exerted on the defence by the staff of FTI in the inspection process was raised for the first time towards the end of the cross‑examination of the 2^nd applicant. It was clearly that issue that prompted the judge to rule that there was to be no more questioning on the matter. It was a collateral matter never even hinted at in the defence case hitherto. We are satisfied that the judge was entitled to rule as he did.”

Again, with respect, we detect no error.

16.As stated above, it is unnecessary to deal in detail with the other points raised by the Applicants.  The Court of Appeal was of the view that the judge was justified in intervening when he did to clarify obscurities in the evidence. It suffices to say that the views of the Court of Appeal cannot be said to be in error, certainly not such as to attract the intervention of this Court under the substantial and grave injustice ground.

17.The Applicants contend that if an overall view was taken, it is clear that the judge had lost his neutrality and had assumed the role of a second prosecutor, thereby leading to an unfair trial.  We disagree.  True it is that the Court of Appeal found that the judge should perhaps not have intervened when he did, but overall it cannot be said that there had been an unfair trial.  We reject the submission that the Court of Appeal did not address this rather obvious point when arriving at the conclusions they did.

18.For the above reasons, the application for leave to appeal was refused.

Mr Edwin Choy, on fiat and Ms Claudia Ko, PP, of the Department of Justice, for the Respondent

Mr Daniel Marash, SC leading Mr Benson Tsoi, Ms Katherine Olley and Ms Joyce Lai instructed by Haldanes, for the 1st Applicant and the 2nd Applicant