Hong Kong Telecommunications (Hkt) Ltd v. Secretary for Commerce and Economic Development and Another
Read the full judgment text of CACV 532/2018 on BabelCite. This Court of Appeal judgment was delivered on 9 January 2019 before Yuen JA and Kwan JA.
Administrative law – judicial review – duty of candour – scope of duty – whether confined to pleaded grounds in Form 86 – specific discovery – Order 24 rules 10, 11 and 13 – whether disclosure of redacted Plum Report necessary for fairly disposing of the issues – confidentiality ring – commercially sensitive information of competitors – telecommunications spectrum re-assignment (900 MHz and 1800 MHz bands) – joint decision of Secretary for Commerce and Economic Development and Communications Authority to conduct partial auction and offer right of first refusal to incumbent mobile network operators (MNOs). The applicant, HKT, one of four MNOs, sought judicial review of the spectrum re-assignment Decision and disclosure of the unredacted Plum Report prepared by an independent consultant engaged by the Communications Authority. The Plum Report was published in redacted form to protect commercially sensitive information of competing MNOs, with confidentiality undertakings given to each MNO. The Court of Appeal considered whether the duty of candour owed by a public authority respondent in judicial review proceedings extends beyond the pleaded grounds in the Form 86. Following Chu Woan Chyi v Director of Immigration [2009] 6 HKC 77, §§14(6) and (7), the court held that the duty of candour is not an open-ended concept and is dependent on the issues before the court, and that while it is not strictly confined to pleaded grounds, it is not a licence for fishing expeditions to obtain material to fashion unpleaded challenges. The court considered the unusual cases (Hook, Evans, Baxter, Quark Fishing) in which information had not been disclosed at the leave stage, and held that the present case did not fall into that category given the extensive engagement of the applicant through three rounds of meetings, the detailed 85-page Form 86 with 13 grounds, and the comprehensive account of the consultation process in the Joint Statement. On the specific discovery application in respect of Grounds 2 and 3 of the Form 86, the court held that the redacted parts of the Plum Report were not relevant: Ground 2 challenged internal inconsistency in the Decision's reasoning on service continuity, not the consultant's analysis, and Ground 3 concerned the interpretation of the Radio Spectrum Policy Framework and whether a full refarming cost-benefit analysis was required, which did not turn on the Plum Report's contents. Disclosure of the redacted parts would pre-empt Ground 10 (procedural unfairness challenge). The court further held that even if disclosure were warranted, the discretion would not have been exercised in favour of the applicant given the commercially sensitive nature of the information, the confidentiality undertakings given to competing MNOs, the Authority's reliance on industry trust and cooperation, and the risk of inadvertent disclosure. The appeal in CACV 532/2018 was dismissed, the application for leave to appeal in CAMP 155/2018 was refused, and the applicant was ordered to pay the respondents' costs in both cases with a certificate for two counsel.
Legal issues: Scope of the duty of candour in judicial review proceedings · Whether the redacted parts of the Plum Report are relevant to Grounds 2 and 3 in the Form 86 for purposes of specific discovery · Exercise of discretion regarding confidentiality ring and disclosure of commercially sensitive information
Outcome: Appeal in CACV 532/2018 dismissed; application for leave to appeal in CAMP 155/2018 refused. The applicant was ordered to pay the respondents' costs in both cases, with a certificate for two counsel.
Cited by 5 cases · Cites 2 cases
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CACV 532/2018 AND CAMP 155/2018 [2019] HKCA 44 CACV 532/2018 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF APPEAL CIVIL APPEAL NO 532 OF 2018 (ON APPEAL FROM HCAL NO 448 OF 2018) ________________________
________________________ AND CAMP 155/2018 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF APPEAL MISCELLANEOUS PROCEEDINGS NO 155 OF 2018 (ON AN INTENDED APPEAL FROM HCAL NO 448 OF 2018) ________________________
________________________ (Heard together) Before: Hon Yuen JA and Kwan JA in Court Date of Hearing: 19 December 2018 Date of Judgment: 9 January 2019 ________________________ J U D G M E N T ________________________ Hon Yuen JA: 1.I agree with the judgment of Kwan JA. Hon Kwan JA: 2.This is the appeal of the applicant, Hong Kong Telecommunications (HKT) Limited, in an application for judicial review against the dismissal of a summons for disclosure of documents by Chow J on 3 October 2018. On 25 October 2018, Chow J gave leave to appeal in respect of four out of six grounds of appeal, taking the view that the scope of the duty of candour in the public law context is a matter of considerable public importance and guidance from the Court of Appeal on this would be helpful. He refused leave to appeal on the other two grounds. 3.The applicant filed a notice of appeal on 26 October 2018 in respect of the four grounds for which leave was granted (CACV 532/2018) and renewed its application to the Court of Appeal for leave to appeal on the two remaining grounds (CAMP 155/2018). 4.We heard the appeal on an expedited basis, together with the application for leave to appeal as a rolled‑up hearing, so that in the event we should decide to grant leave to appeal for the remaining grounds, the hearing of the leave application would be treated as that of the appeal. Background 5.The decision that is the subject of the application for judicial review is that of the respondents, the Secretary for Commerce and Economic Development (“the Secretary”) and the Communications Authority (“the Authority”), contained in a Joint Statement issued by them on 19 December 2017, entitled “Arrangements for the Frequency Spectrum in the 900 MHz and 1800 MHz Bands upon Expiry of the Existing Assignments for Public Mobile Telecommunications Services and the Related Spectrum Utilisation Fee” (“the Joint Statement”), specifically “to conduct a partial auction of the 900 MHz and 1800 MHz Bands upon expiry of the existing assignments in 2020 and 2012” (“the Decision”). 6.Leave to apply for judicial review was granted on paper on 23 March 2018 and the substantive hearing is to be held on 12 February 2019 before Chow J with four additional days reserved. 7.On 24 April 2018, the applicant issued a summons under Order 53 rules 3 and 8[1] seeking:
8.The summons was heard by Chow J on 22 August 2018. He gave the decision on the interim relief application on 24 August 2018 and the decision on the disclosure application on 3 October 2018. The latter is the subject of the present appeal and application for leave to appeal. 9.I take the following basic facts from those two decisions of Chow J and will adopt the expressions and abbreviations in his decisions:
Chow J’s decision on the disclosure application 10.Mr Yu[3] submitted on behalf of the applicant that two relevant principles should be applied:
11.The respondents resisted the application primarily on the ground that the documents sought are irrelevant to the issues in dispute and are not necessary for the fair and just disposal of the proceedings for judicial review[5]. They prayed in aid the criteria for specific discovery as the established mechanism for requiring the production of further documents not included in the primary disclosure. 12.Regarding the principle invoked by the applicant in (1), Chow J noted that in Ground 10 of the application for judicial review, a complaint is already advanced that the version of the Plum Report disclosed to the applicant is so heavily redacted that it has been unable to give intelligent consideration to the Plum Report in relation to the issue of customer service continuity, or meaningful response to the Consultant’s conclusions on that issue. He took the view that this ground of judicial review can be advanced by the applicant without seeing the redacted parts of the Plum Report. As for the communications to the Consultant sought by the applicant, this is ancillary to the application for disclosure of the full unredacted version of the Plum Report and does not require separate consideration[6]. 13.As for the applicant’s reliance on the principle in (2), Chow J cited the judgment of Ma CJHC (as he then was) in Chu Woan Chyi v Director of Immigration [2009] 6 HKC 77 at §14(6) and (7) and held:
14.Having rejected the applicant’s submissions on the scope of the duty of candour, Chow J went on to apply the criteria for specific discovery. He accepted the submission of Mr Abraham Chan, SC (who appeared for the respondents below and on appeal[8]) that “the accuracy or rigor of the analysis in the Plum Report is not a critical issue in dispute in these proceedings, and none of the Applicant’s 13 Grounds of challenge are founded on the assertion that the analysis in the Plum Report is unreasonable or incorrect”[9]. The judge noted that the only grounds in the Form 86 which may have some connection on their face with the Plum Report are Grounds 2, 3 and 10. 15.Ground 10 has been dealt with as mentioned above. 16.As for Ground 2, the complaint is that the Authority acted irrationally in having regard to service continuity only in respect of 2G and a limited part of 4G service. The judge regarded it significant that the applicant “is not making any complaint about the Consultant’s analysis in relation to the issue of customer service continuity in the Plum Report”. He held that it has not been demonstrated by the applicant the redacted parts of the Plum Report are relevant to its complaint under Ground 2[10]. 17.Ground 3 relates to the complaint that the Authority erred in refusing and failing to carry out a full ‘refarming’ cost-benefit analysis under the Radio Spectrum Policy Framework (“SPF”) §4.4. The judge took the view that whether the Authority was required, but failed, to do so should be “readily apparent” from the relevant provisions of the SPF and the Joint Statement. He held that the applicant has failed to pin-point how the redacted parts of the Plum Report are or might be relevant to its complaint under Ground 3[11]. 18.Chow J summed up his conclusion in this way:
19.He refused to give leave to appeal in respect of the two proposed grounds which relate to the complaint of “irrationality” (Ground 2 in the Form 86) and the complaint that the Authority failed to carry out a full ‘refarming’ cost-benefit analysis under §4.4 of the SPF (Ground 3 in the Form 86), as he is not convinced that the redacted parts of the Plum Report are relevant to either of these complaints, and does not consider that the proposed grounds of appeal are reasonably arguable or have reasonable prospects of success[13]. The grounds and proposed grounds of appeal 20.Grounds 1 to 3 in the notice of appeal relate to the scope of the duty of candour on the part of the respondents and seek to challenge the holding that the scope of this duty is limited by reference to the issue or issues before the court, the determination of which must be based on the grounds of judicial review as raised in Form 86. It is the applicant’s contention that this duty is not so confined but extends to the relevant facts and reasoning underlying the decision challenged. 21.Ground 4 in the notice of appeal relates to the adequacy or sufficiency of the proposed confidentiality ring. This will become relevant if the applicant is correct in its contention about the scope of the duty of candour and goes to the exercise of the court’s discretion whether a full, unredacted version of the Plum Report should be ordered to be disclosed. 22.The two proposed grounds of appeal for which the applicant seeks leave to appeal challenge the holdings that the redacted parts of the Plum Report are irrelevant to Grounds 2 and 3 in the Form 86. The proposed grounds of appeal attack the conclusion reached by the judge in applying the criteria for specific discovery. 23.Mr Yu indicated that his main submission is that the applicant has a general duty of disclosure under the duty of candour, and specific discovery is his fallback position, which would include his reliance on Order 24 rule 10. 24.Be that as it may, I think it is more logical first to deal with specific discovery in respect of the proposed grounds of appeal. The criteria for specific discovery are narrower than the scope of the duty of candour as advocated by Mr Yu. If the applicant is unable to bring itself within the narrower ambit, it would then be appropriate to consider whether there is a duty of candour with the wider scope as submitted and, if so, whether the discretion to order disclosure should be exercised notwithstanding the issue of confidentiality. Grounds 2 and 3 in the Form 86 25.Ground 2 seeks to challenge the Decision of the Authority on irrationality as regards the question of service continuity. The applicant’s case is encapsulated in §138 of the Form 86. Specifically, these two sentences in §14 and §29 of the Decision, are said to be “incoherent and irrational” when taken together: “While the 900/1800 MHz Spectrum constitutes only 31% of the spectrum deployed for the provision of 3G and 4G services, the provision of 2G services is supported solely by spectrum in the 900 MHz and 1800 MHz bands” and “[the Re‑assignment of the 900/1800 MHz Spectrum] is not expected to affect the provision of 3G services in general since 3G services are primarily provided by using the spectrum in the 1.9‑2.2 GHz band”. 26.The applicant contended in §138 of the Form 86 “it is incoherent and irrational to accept that the relevant spectrum constitutes a third of the spectrum deployed for 3G and 4G” (in §14 of the Decision) and then to conclude (in §29 of the Decision) that “the reassignment of the spectrum is not expected to affect the provision of 3G services (4G and 5G services apparently being overlooked altogether)”. 27.The gravamen of the attack in Ground 2 is that there is an apparent internal inconsistency in the reasoning of the Decision, which vitiates the conclusion arrived at. I agree with the judge that in Ground 2 the applicant is not making any complaint about the Consultant’s analysis relating to customer service continuity in the Plum Report. 28.Ground 3 relates to the interpretation of §4.4 of the SPF and the complaint that the Authority failed to carry out a full ‘refarming’ cost-benefit analysis. The issue here is whether the Authority was or was not required to undertake the appraisal. Quite clearly, this does not turn on the content or merits of the Consultant’s analysis in the Plum Report. As the judge has stated, this issue should turn on the relevant provisions of the SPF and the Joint Statement. 29.In the proposed grounds of appeal, the applicant sought to argue the judge was in error in requiring the applicant to demonstrate that the redacted parts of the Plum Report are or might be relevant to the complaints in Grounds 2 and 3 of the Form 86. The reasons are firstly the Plum Report was so heavily redacted that the Consultant’s analysis was not intelligible, so the applicant was unable to make any complaint about the Consultant’s analysis. Secondly, as the Plum Report was incorporated by reference in the Joint Statement “without any abstraction of its reasoning”, the Plum Report was relevant to the reasoning behind the Decision of the Authority. 30.I do not accept the above arguments. We are applying here the criteria for specific discovery. 31.The assertion that the applicant was unable to make any complaint about the Consultant’s analysis insofar as this relates to Grounds 2 and 3 in the Form 86 owing to heavy redaction of the Plum Report is tacit acceptance that the applicant has not raised any issue about the Consultant’s analysis in Grounds 2 and 3. Quite clearly, disclosure of the redacted parts is sought to enable the applicant to explore if complaints could be made about the Consultant’s analysis. This is fishing for material to mount possible further challenge and is not permissible. 32.The complaint that there was procedural unfairness arising out of the redaction is the subject of the challenge in Ground 10. Mr Yu submitted that the disclosure of the redacted parts would not “pre‑empt” Ground 10. He contended that the redacted parts should be disclosed so that the court would be able to better assess if the redacted material could have made any difference to the applicant’s understanding and its ability to make a meaningful response. 33.I agree with the judge that the challenge of procedural unfairness in Ground 10 can be advanced without seeing the redacted parts. And there is no getting away from the reality that disclosure of the redacted parts would “pre‑empt” Ground 10. Applying the criteria of specific discovery, I do not think disclosure of the redacted parts is necessary for disposing fairly of the issue raised in Ground 10. As submitted by Mr Chan, disclosing the redacted parts at this stage would plainly undermine and essentially negate the respondents’ ability to effectively maintain, at the substantive hearing, that it was and remains proper and in the public interest to withhold the redacted information from the applicant. 34.As for the contention that the Plum Report was “relevant to the reasoning behind the Decision of the Authority”, such a general assertion is insufficient for specific discovery and must be considered in the context of the present circumstances. There was “full engagement” by all the MNOs, including the applicant, in the course of the Study including their participation in three rounds of individual meetings with the Consultant, who had “provided the relevant scenario assumptions (namely the range of spectrum holding of the concerned MNO in scenarios) to the corresponding MNO during the meetings”[14]. The Form 86 in these proceedings is a detailed and lengthy document in which 13 grounds were advanced to challenge the Decision. It is telling that the applicant is unable to demonstrate any possible relevance of the redacted material to any of the detailed grounds of challenge and has to resort to assertions that the Plum Report was relevant to the Decision in a broad manner of speaking. 35.Order 24 rules 10 and 11 are subject to Order 24 rule 13(1) that no order for production of any documents shall be made unless it is necessary for disposing fairly of the cause or matter. For the reasons already given, neither Order 24 rule 10 nor the general observations of Rix LJ in Rubin v Expandable Ltd [2008] 1 WLR 1099 at §24 regarding the inspection of a document mentioned in one of the qualifying documents in the rules of court would avail the applicant. 36.It does not appear to me that the proposed grounds of appeal are reasonably arguable. I would refuse to grant leave to appeal and dismiss the applicant’s summons in CAMP 155/2018. The applicant’s submissions on the duty of candour 37.The applicant submitted that the Decision plainly relied on the Study for its conclusions and asserted that the detailed reasoning supporting the Authority’s conclusions is hidden behind the redactions in the Plum Report[15]. The duty of candour covers materials which are relevant to why the decision-maker has made the decision in question. Under this duty, the decision-maker is to make full and fair disclosure of the decision-making process, laying before the court all the relevant facts and reasoning underlying the decision challenged (Tweed v Parades Commission for Northern Ireland [2007] 1 AC 650 at §§31 and 54, per Lord Carswell and Lord Brown respectively). The existence and rationale of this duty are not to be equated with procedural rules and practices concerning the proving of facts or leading evidence (Graham v Police Service Commission [2011] UKPC 46 at §19, per Sir John Laws), and proceedings for judicial review should not be conducted in the same manner as hard-fought litigation (Belize Alliance of Conservation Non-Governmental Organisations v Department of the Environment of Belize [2004] UKPC 6 at §86, per Lord Walker). 38.The duty of candour arises upon the granting of leave to apply for judicial review, as by then the material before the court is sufficient to persuade it to grant leave. The duty then rests upon the respondent to file evidence to fill up the gaps in the knowledge of the court, bearing in mind that the court is exercising a supervisory jurisdiction (R v Barnsley Metropolitan Borough Council ex parte Hook [1976] 1 WLR 1052 at 1060F to G, per Scarman LJ; R v Lancaster County Council ex parte Huddleston at 945b, per Sir John Donaldson MR). 39.Mr Yu submitted that the scope of this duty of candour is not limited by reference to the issues as raised in the Form 86 and it covers material that is relevant or assists the claimant including material on some as yet unpleaded ground. Other than the general statements of principles as mentioned above, he relied on these statements in De Smith’s Judicial Review (8th ed) and Fordham’s Judicial Review Handbook (6th ed) at §10.4:
40.The passage in Fordham at §10.4 was cited with approval by Lord Kerr in R (Bancoult) v Secretary of State for Foreign and Commonwealth Affairs (No 4) [2017] AC 300 at §183. 41.In §10.4.3 of Fordham, under the heading of “Defendant’s candour: beyond the pleaded case”, the author cited these cases as examples in which disclosure was made by the respondent which went beyond the grounds stated in the original statement: R (Evans) v Lord Chancellor and Secretary of State for Justice [2011] EWHC 1146 (Admin) [2012] 1 WLR 838 at §5; R v Barnsley Metropolitan Borough Council, ex parte Hook at 1058C to D; R v Waltham Forest London Borough Council, ex parte Baxter [1988] QB 419 at 422A to B. 42.Mr Yu also drew attention to Secretary of State for Foreign and Commonwealth Affairs v Quark Fishing Ltd [2002] EWCA Civ 1409 at §50, in which Laws LJ did not confine the duty “to assist the court with full and accurate explanations of all the facts relevant to the issue the court must decide” to the pleaded grounds. It was held in that case that the material put forward by the Secretary of State did not convey a fair and full picture of the decision-making process (at §51). 43.There remain these pertinent statements of Ma CJHC in §§14(6) and (7) of Chu Woan Chyi, which were followed by the judge:
44.Mr Yu submitted that the judgment of the CJHC in Chu Woan Chyi should be read as a whole and the statements in §§14(6) and (7) should be read in context with §13 which is as follows:
45.Mr Yu contended there is no indication what was said in §14(6) should undermine what was stated earlier in §13. Discussion of the applicant’s submissions 46.The applicant’s contention is that the judge was wrong in law to hold that the scope of the duty of candour of a respondent is limited by reference to “the issues pleaded in the Form 86”[16]. As Mr Yu rightly pointed out, in the extract in Chu Woan Chyi at §§14(6) and (7) set out above, Ma CJHC did not use the words “pleaded or unpleaded” issue in the Form 86. What he actually said was: “What in any given case may constitute the fulfilment of that duty [of candour] is entirely dependent on the issue or issues that are before the court”. Properly understood, what was said in Chu Woan Chyi at §§14(6) and (7) are not in conflict with the statements in De Smith and Fordham cited by Mr Yu, in which the authors expressed the view that the duty of candour may extend to disclosure of information relating to “further grounds of challenge which might not otherwise occur to the claimant”, “including on some as yet unpleaded ground”. 47.Although the issue or issues that are before the court in judicial review proceedings should be identified from the grounds in the Form 86, there may be unusual situations in which the issues are not so raised. The three cases cited in Fordham at §10.4.3 are examples. It should be noted in each of those cases, no or no relevant information on the decision-making process was disclosed to the applicant at the time leave was granted to apply for judicial review. Quark Fishing Ltd is another instance in which the business of uncovering the decision-making process was described as “tortuous and problematic” (at §§22 and 27). 48.In R v Barnsley Metropolitan Borough Council, ex parte Hook, the relevant information (that the market manager was present at the deliberations of the council committee) was not known to the applicant and so was not mentioned in his grounds of application for judicial review in the Divisional Court. The issue was raised in the affidavit evidence filed by the authority. On appeal, the applicant was allowed to use this as a ground to challenge the committee’s decision. 49.In Evans, the court at first instance had refused permission to advance a complaint of want of disclosure as a ground of judicial review. Thereafter, disclosure of the documents was properly made by the Secretary of State, showing the true reasons for the amendment of the funding code of the Legal Services Commission (being the subject of the judicial review). This allowed the applicant to argue on appeal that the consultation process leading to the amendment of the funding code was flawed for want of disclosure of documents showing the true reasons for the proposed amendments. 50.Similarly, the applicants in R v Waltham Forest London Borough Council, ex parte Baxter were faced with the initial difficulty that they did not know why certain members had voted in favour of a resolution in a council meeting and could only allege that the conduct of those members was Wednesbury unreasonable. It was when the council rightly responded with additional information that four principal issues emerged, which the Divisional Court and later the Court of Appeal considered. 51.In rejecting Mr Yu’s submission that “the duty of candour would require the public authority to disclose documents which may be relevant to unpleaded grounds”, Chow J said the effect of the extracts in §§14(6) and (7) of Chu Woan Chyi is that “the scope of the duty of candour is limited by reference to the issue or issues before the court, the determination of which must, in my view, be based on the grounds of judicial review as raised in the Form 86”[17]. If by this Chow J meant that “the issue or issues that are before the court” must be confined to pleaded grounds in the Form 86, it seems to me he was rather too restrictive in his reading of §§14(6) and (7) in Chu Woan Chyi, as there are unusual instances borne out by the cases mentioned above. To this extent, I do not agree with Mr Chan in his written submission that “the ambit of the duty [of candour] cannot exceed the scope of substantive issues identified in the Form 86 which require decision by the court”. 52.The important point that was made in §§14(6) and (7) of Chu Woan Chyi is not so much whether an issue is or is not pleaded in the Form 86 so as to be covered by the duty of candour. The particular aspect Ma CJHC sought to highlight in that extract is that the obligation to be full and frank in the discharge of that duty is “not an open‑ended or imprecise concept” and “the court will be astute in judicial review proceedings not to permit so called ‘fishing’ expeditions by applicants in the hope of unearthing material to enable a challenge to be mounted”. Hence, whether in any given case the duty of candour is fulfilled “is entirely dependent on the issue or issues that are before the court”. That is why “there is no automatic discovery in judicial review proceedings”, so “if discovery is required, a separate application must be made: RHC O. 53 r. 8”. The court will in principle be “more, not less, inclined to make the necessary orders”, “once the critical issue is identified in judicial review proceedings and where the resolution of this issue requires that the court be provided with adequate material”. 53.If it is suggested that §§14(6) and (7) of Chu Woan Chyi should be read down so this would not have the effect of undermining the statements in §13, I would disagree with this suggestion. As stated in the opening words of §14, the sub‑paragraphs that follow “highlight various facets and examine how the duty fits into the general scheme of judicial review proceedings, in order fully to comprehend the true nature and extent of the duty”. 54.I do not understand Mr Yu to have belittled the importance to guard against fishing expeditions by applicants in the hope of unearthing material to enable a challenge to be made. The words of Lord Carswell in Tweed at §31 were cited in §14(6) of Chu Woan Chyi (“the undesirability of allowing “fishing expeditions”, where an applicant for judicial review may not have a positive case to make against an administrative decision and wishes to obtain disclosure of documents in the hope of turning up something out of which to fashion a possible challenge”). See also Lord Brown in Tweed at §56 (“disclosure orders are likely to remain exceptional in judicial review proceedings, … and the courts should continue to guard against what appear to be merely “fishing expeditions” for adventitious further grounds of challenge”). To similar effect are these words of Parker LJ in R v Lancaster County Council ex parte Huddleston at 947f to g:
55.Sir John Donaldson MR expressed his agreement with Parker LJ that “the grant of leave to apply for judicial review does not constitute a licence to fish for new and hitherto unperceived grounds of complaint” (at 946f). 56.To recapitulate, the law on this aspect of the scope and nature of the duty of candour is as stated in §§14(6) and (7) of Chu Woan Chyi. As Chow J has observed[18], this is consistent with the statements of Singh LJ in R (Hoareau) v Secretary of State for Foreign and Commonwealth Affairs [2018] EWHC 1508 (Admin) at §20:
57.To state the obvious, whether in a given situation the duty of candour is discharged would depend on the facts, the issues before the court, and the basis of the challenge mounted. As Parker LJ had said in R v Lancaster County Council ex parte Huddleston at 947b, the grounds on which leave is granted to apply for judicial review vary enormously, so too do the answers which the respondent may properly make. It is not possible to generalise. Sir John Donaldson likewise agreed that “the appropriate response by the respondent will depend on the facts of each case which are almost infinitely variable” (at 946f). If the duty of candour is fulfilled in the present case 58.Turning to the facts in the present case, I examine the circumstances to see if the duty of candour is fulfilled. Put in another way, the question is whether the disclosure sought is “necessary for disposing fairly” of the issues before the court, or to “enable the court to deal justly” with the challenge mounted in this application for judicial review (Tweed at §§3 and 52). 59.The redacted materials in the Plum Report, being part of the documents sought to be disclosed in the disclosure application, consist largely of information provided by the MNOs (which are in direct competition with one another) to the Consultant relating to the utilisation of the relevant band of frequencies assigned to them. It includes for each of the MNOs a combination of actual and forecast figures including data traffic, the number of customers using the respective bands of frequencies, the deployment of mobile technologies (such as 3G or 4G) in its network as well as any spectrum refarming plan, all of which is very specific to the MNO concerned and highly commercially sensitive. 60.As disclosure of such information of an MNO to its competitors could potentially be highly damaging and could undermine competition between them, the MNOs had insisted on information in relation to their network design and traffic to be provided to the Consultant for the Study being kept confidential. Notwithstanding that the Authority and the Consultant are under a statutory duty[19] to preserve the confidentiality of information provided by the MNOs to the Consultant, the Authority and the Consultant provided independent confidentiality undertakings to the MNOs at the specific request of the applicant, SmarTone and Hutchison to give all the MNOs additional assurance to safeguard the confidentiality of the information provided by each of them. 61.Further, as the information obtained by the Consultant from direct competitors is of an exceptionally sensitive kind, and the Study involved predictions about how individual MNOs would be impacted by loss of their spectrum holdings which could itself influence the outcome of the Auction, the Consultant took care not to disclose a level of detail in its published findings that would enable one MNO to understand, or reverse engineer, sensitive information drawing on the position of the other MNOs. Hence, following completion of the Study, the Plum Report was published in a redacted form with the Second Consultation Paper, and the reasons for redaction, as subsequently explained in the Consultant’s Response in September 2017, were that “it is not appropriate for [the Consultant] to disclose further details of the assumed spectrum scenarios” as “to disclose such information would in effect enable all readers to second-guess the identity of the MNOs in the spectrum scenarios, thereby in effect compromising [the Consultant’s] undertaking of non-disclosure of confidential information as obtained from each MNO.” 62.The entire Consultancy Brief was issued to the MNOs. I am not persuaded that disclosure of all communications to the Consultants sought in the disclosure application is necessary for a proper understanding of the Plum Report. The MNOs were extensively involved in the Study. The Consultant conducted extensive information gathering and consultation with each of the MNOs. There were three rounds of meetings with each of them prior to the publication of the Plum Report: the first covered the general assessment approach, the key considerations in the Study and the inputs and outputs of the assessment mode; the second involved clarification of the data provided by each MNO and the Consultant’s update on the assessment model; the third was for the Consultant to brief each MNO on the results of its preliminary assessment and the key assumptions it had used for the assessment model. Following the publication of the Plum Report, there was another round of individual meetings with each MNO to obtain feedback on the report. 63.Hence, in the individual meetings, the applicant (with the involvement of its external consultants) was informed about the traffic forecasts adopted, assumptions used in the model, the assumptions for the various spectrum scenarios (including assumptions as to the range of spectrum holding that the applicant may have), the maximum amount of spectrum that the applicant was assumed to lose if there was a new entrant, the general results of the Study and those related specifically to the applicant[20]. The same applied to the other MNOs. Each was informed about how the network information it provided to the Consultant had been deployed in the assessment model and was provided with findings specific to each of them under the different scenarios referred to in the Study. But none of them was given corresponding information and specific findings in respect of the other MNOs, so none was privy to the confidential information provided by other MNOs. 64.The applicant had sought disclosure of the full unredacted version of the Plum Report in February 2017 when the redacted report was published. The Authority refused the applicant’s request and provided reasons for its refusal, which included the fact that the Study contained input and findings based on commercially sensitive operational information of individual MNOs. The applicant did not bring proceedings to challenge this refusal decision at the time. The disclosure application, seeking essentially the same documents, was only made a month after the Form 86 was issued. 65.The Decision being the subject of the application for judicial review was made in the Joint Statement issued on 19 December 2017. The Consultant’s Response to the comments received in the submissions to the Second Consultation was published on the same date. Relevant parts of the Joint Statement have been set out in the earlier part of this judgment. The Joint Statement is a detailed document giving inter alia a comprehensive account of the consultation process and the approach adopted towards spectrum re-assignment. The level of transparency and extensive engagement of those involved in the consultation exercise gave a fair and full picture of the decision-making process, unlike the situation in the cases mentioned earlier when the applicant was hampered by the lack of information on the decision-making process when leave was sought to apply for judicial review (R v Barnsley Metropolitan Borough Council, ex parte Hook; Evans; R v Waltham Forest London Borough Council, ex parte Baxter; Quark Fishing Ltd). 66.The Form 86 issued by the applicant on 19 March 2018 took up 85 pages, excluding appendices. 13 grounds of review were put forward. Given that detailed and comprehensive grounds have been advanced, there is no good reason why the issues that are before the court in these proceedings for judicial review should not be identified from the grounds in Form 86. As was said by Zervos J (as he then was) in Zhu Li v The Law Society of Hong Kong [2017] 3 HKLRD 513 at §46: “Given the diversity and breadth of public administration, with its numerous structures and layers, the court’s judicial review jurisdiction needs to be put in perspective and kept in check.” There is much to be said for the point made by Mr Chan that given the continuing administrative pressures on the court system, and particularly where the decision-making process under challenge is lengthy and complicated (as in the present and increasingly many cases), the importance of a focused (rather than roving) supervisory process is acute. 67.The only grounds in the Form 86 that could be said to have some connection to the Plum Report are Grounds 2, 3 and 10. They have been discussed earlier and for the reasons already given, I agree with Chow J that it has not been shown the redacted material would have any relevance to the detailed grounds of challenge. The applicant has not been able to identify specific issues that are alleged to require further specific disclosure of the particular documents sought, why those issues are relevant, or why it is contended that the information provided hitherto is not adequate to enable the court to resolve the specific issues that arise[21]. We were given to understand that documents voluntarily disclosed by the respondents have taken up more than 20 bundles and this application for judicial review is the heaviest litigation the Authority has to deal with so far, necessitating five days to be set aside for the substantive hearing. 68.In my view, the disclosure sought was made in the hope of obtaining information to enable the applicant to fashion further grounds of challenge that have not occurred to its legal advisers. This is a fishing expedition and is not permissible. I consider that the duty of candour has been fulfilled in this instance in light of the issues that are before the court. The disclosure sought is not necessary for disposing fairly of the critical issues in these proceedings. Confidentiality 69.It is not strictly necessary to consider the sufficiency of the confidentiality ring and how this may impact on the discretion to order disclosure if I had been of the view that the duty of candour had not been fulfilled by the Authority. In deference to the submissions made, I would endeavour to give my views succinctly. 70.If it had been necessary to consider the confidentiality ring, I am not persuaded that in carrying out the balancing exercise, the discretion should be exercised in favour of the applicant. The Authority cannot resort to statutory powers[22] to obtain information in the context of a consultation and relies on the trust and co‑operation of the industry participants. If the Authority is required to disclose the commercially sensitive information sought by the applicant, this is likely to undermine the MNOs’ trust and confidence based on the assurance that confidential information would not be divulged and may well have a chilling effect on their willingness to co‑operate by providing confidential information in future[23]. There is also the risk of inadvertent disclosure notwithstanding a confidentiality ring limited to the applicant’s external lawyers, external consultants and one in‑house counsel, and the practicality of monitoring the restraint. It is more prudent to “cause minimum disturbance to that confidence when assessing the requirements of justice in the disclosure of the documents sought” (Tweed, §37). That was also the view taken by Chow J[24]. Conclusion 71.For the above reasons, I would dismiss the appeal in CACV 532/2018 and the summons for leave to appeal in CAMP 155/2018. 72.We have heard submissions on costs. There is no dispute that costs should follow the event and there should be a certificate for two counsel. I would make an order that the applicant is to pay the respondents’ costs in CAMP 155/2018 and CACV 532/2018, with a certificate for two counsel.
Mr Benjamin Yu SC and Mr Roger Beresford, instructed by Baker & McKenzie, for the Applicant in both cases (the Applicant in CAMP 155/2018 and the Appellant in CACV 532/2018) Mr Abraham Chan SC, Mr Joshua Chan and Mr Harrison Miao, instructed by the Department of Justice, for the 1st Respondent in both cases (the 1st Respondent in both cases) and by Eversheds Sutherland for the 2nd Respondent in both cases (the 2nd Respondent in both cases) [1] Order 53 rule 8(1) and (2) provide as follows: “(1) Unless the judge otherwise directs, any interlocutory application in proceedings on an application for judicial review may be made to any judge in chambers or a master. (2) In this paragraph “interlocutory application” includes an application for an order under Order 24 or 26 or Order 38, rule 2(3) …” [2] The Joint Statement stated as follows in §§20 and 24: “20. Having considered the views and comments received in the submissions to the First Consultation Paper, the findings of the Study [conducted by the Consultant], and having conducted a pros and cons evaluation of the three proposed options against the multiple objectives in spectrum re-assignment, the [Authority] put forward in the Second Consultation Paper a revised hybrid administratively-assigned cum market-based approach for further consultation. …” “24. … In the Second Consultation Paper, the [Authority], having taken into account the views and comments received from the first consultation as well as the findings of the Study, evaluated the three options against the multiple objectives in spectrum re-assignment, and reached the considered view that the hybrid administratively-assigned cum market-based approach (i.e. Option 3) would be the preferred approach to be put forward for further consultation, as it best meets the multiple objectives of spectrum re-assignment.” [3] With Mr Roger Beresford below and on appeal [4] Decision of 3 October 2018, §15 [5] Decision of 3 October 2018, §16 [6] Decision of 3 October 2018, §18 [7] Decision of 3 October 2018, §20 [8] With Mr Joshua Chan below, and with Mr Joshua Chan and Mr Harrison Miao on appeal [9] Decision of 3 October 2018, §21 [10] Decision of 3 October 2018, §§21, 22 [11] Decision of 3 October 2018, §23 [12] Decision of 3 October 2018, §24 [13] Decision of 25 October 2018, §9 [14] Response of the Consultant to views and comments on the Study dated September 2017, §2.1 [15] In support of this assertion, the applicant relied on the 1st affirmation of Paul Nicholas Reynolds filed on 16 March 2018, §§116 to 119. [16] Ground 1 of notice of appeal in CACV 532/2018 [17] Decision of 3 October 2018, §20. See also decision of 25 October 2018, §6 [18] Decision of 25 October 2018, §6 [19] Section 23(1) of the Communications Authority Ordinance, Cap 616; section 7I of the Telecommunications Ordinance, Cap 106 and Special Condition 6 of the Unified Carrier Licence granted to the MNOs [20] 1st affidavit of Cheuk Sing Tak Sanda filed on 8 June 2018, §60 [21] Discussion paper prepared by Cranston J and Lewis J on 28 April 2016 for the Lord Chief Justice of England and Wales, Defendant’s Duty of Candour and Disclosure in Judicial Review Proceedings, § (28)(2)(a) [22] Telecommunications Ordinance, sections 7I and 36D [23] Letters were received by the Authority from the solicitors of SmarTone and China Mobile in April and May 2018 objecting to disclosure of the unredacted version of the Plum Report [24] Decision of 3 October 2018, §24 |
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