HKSAR v. Chau Ka Yin

FAMC No.49 of 2016

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO.49 OF 2016 (CRIMINAL)

(ON APPLICATION FOR LEAVE TO APPEAL FROM

HCMA NO.681 OF 2015)

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BETWEEN

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Appeal Committee: Mr Justice Ribeiro PJ, Mr Justice Tang PJ and Mr Justice Fok PJ

Date of Hearing and Determination: 31 October 2017

Date of Reasons for Determination: 6 November 2017

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REASONS FOR DETERMINATION

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Mr Justice Ribeiro PJ:

1.At the hearing, we dismissed this application for leave to appeal for reasons which we now provide.

The facts and decisions below

2.Hang Ning (“D1”) and the applicant were employed by different employment agencies and each worked in sections placing executives in jobs in the banking sector.  D1’s employer was Global Executive Consultants Ltd (“GE”) while the applicant worked for GS Consultants Limited (“GS”).  The applicant had previously worked alongside D1 at GE. 

3.D1 passed the CVs of five job-seekers to the applicant who successfully placed them with Citibank via GS.  She then paid D1 “referral fees” in respect of those placements.  Those facts are not disputed.

4.The applicant was convicted[1] of conspiring with D1 for him to accept an advantage contrary to section 9(1)(a) of the Prevention of Bribery Ordinance[2] and was sentenced to imprisonment for six months.  Section 9(1)(a) relevantly provides:

“Any agent who, without lawful authority or reasonable excuse, solicits or accepts any advantage as an inducement to or reward for or otherwise on account of his ... doing ... or having done ... any act in relation to his principal's affairs or business ... shall be guilty of an offence.”

5.Her appeal was dismissed by DHCJ Anthony Kwok[3] and leave was sought from the Appeal Committee on the substantial and grave injustice basis.

The applicant’s case

6.The applicant submits that:

“... the findings of the learned trial Magistrate in respect of the Applicant’s mens rea were not sufficient to support a finding that she knew or intended that the acts for which D1 were rewarded (as particularized in the four charges) were ‘in relation to’ D1’s principal’s affairs or business, in the sense as articulated in this Court’s Judgment in Chan Chi Wan Stephen.”[4]

7.This argument is premised on a very narrow view of what is capable of being conduct “in relation to his principal's affairs or business” under 9(1)(a).  The applicant contends that D1’s conduct would only be caught if the prosecution can prove that the CVs originated from GE’s confidential database or were obtained by D1 during his hours of employment or having been approached by the candidates in his capacity as an employee of GE.[5]

8.The core of the applicant’s case for leave to appeal – which focusses solely on misuse of confidential information – is stated as follows:

“On the basis of the learned Magistrate’s findings, once it was accepted that it was possible that the CVs provided to the Applicant originated from a private source[6], it is submitted that there existed a reasonable doubt that the Applicant might have paid referral fees as a reward for referrals of successful candidates as opposed to specifically paying D1 money as a reward for him to provide her with confidential information belonging to GE.  The fact that D1 himself might have competed or acted in conflict with GE’s business interest by utilizing information obtained through his personal contacts for his own purposes is neither here nor there; s.9 is aimed at corrupt transactions with agents, not dishonest acts by agents.  In other words, the Applicant’s payment to D1 might not have been as a reward for D1 having performed an act that was “aimed at” GE in the Ch’ng Poh sense and as elaborated by this Court in Chan Chi Wan Stephen.  Accordingly, section 9 would not have been engaged.”[7] (Bold type in the original)

9.This is an untenable argument.  Where an agent acts in conflict with his principal’s business his acts are of course likely to qualify as dishonest acts “by an agent”.  But where a person (such as the applicant) provides an agent with an advantage as an inducement or reward for that agent to perform such conflicting acts, that person is involved in a corrupt transaction with that agent.  The suggestion that it is “is neither here nor there” that an agent acts in conflict with the interests of his principal is startling.  An agent so acting is a paradigm of an agent acting in a manner “which subverts the integrity of the agency relationship to the detriment of the principal’s interests”[8] and thus of an agent acting “in relation to his principal's affairs or business” within the meaning of POBO 9(1)(a).

10.The Courts below found that D1’s impugned conduct, rewarded by the payments received from the applicant, had two strands.  First, the CVs which had been obtained by him constituted confidential information which he was under a duty to use solely for GE’s purposes and, in passing them on to the applicant for the payments received, he violated the duty of confidentiality which he owed to GE in relation to it business, in breach of section 9(1)(a).[9]

11.Secondly, even if the CVs had been furnished to D1 through his private e‑mail and out of working hours, he was nevertheless duty bound to treat the resumés as information to be used only for GE’s purposes. He should have tried to place the job-seekers as GE clients in any suitable banking positions available instead of channelling them to a business competitor.[10]  This was essentially a finding that, by diverting potential business opportunities away from GE to a competitor for his own gain, D1 placed himself in a position where his interests were in conflict with his duties to GE.[11]  The Magistrate put it this way:

“D1’s acts of accepting referral fees from D2, in my view, could obviously cause D1 not to set his heart on introducing to job candidates or match them with similar jobs in other banks, which were available to GE in the year in question. In the course of it, there was obviously conflict of interest on his part. In my view, such act of accepting referral fees was undoubtedly corrupt conduct which section 9 of the Ordinance aimed at.”[12]

12.The Courts below found that the applicant, having worked at GE alongside D1, knew full well that D1 was violating GE’s rules in providing her with the CVs and that she had:

“... made many admissions in court and in the interviews, including that she knew that it was an improper conduct that D1 passed the company information of GE on to her, and she knew that no conflict of interest was allowed, she understood that using the information in the Database for other purposes by GE employees was not allowed and there would be conflict of interest, and she understood that paying D1 rewards was ‘very risky’ .”[13]

13.Entering into her arrangement for referrals with D1 with such knowledge, constituted the mens rea for the conspiracy charges.  We therefore concluded that the applicant’s case is not reasonably arguable.

Mr Derek C.L. Chan, instructed by Lee & So, for the Applicant

Mr Anthony Chau, SPP, of the Department of Justice, for the Respondent