Leung Chi Ching Candy v. Yeung Hon Sing

CACV 397/2020

[2021] HKCA 1778

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 397 OF 2020

(ON APPEAL FROM DCCJ NO 5079 OF 2015)

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Before: Hon Kwan VP, Chu JA and Au JA in Court

Date of Hearing: 2 November 2021

Date of Judgment: 26 November 2021

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J U D G M E N T

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

1.This is the defendant’s appeal against the judgment of Deputy District Judge Vincent Lung on 15 November 2019 in a libel action given after an eight-day trial (“the Judgment”). The judge found in favour of the plaintiff and awarded damages of $400,000 and a final injunction to restrain further publication of the defamatory statements. The appeal was brought with leave granted by the Court of Appeal^[1]on 17 August 2020.

2.The substantive part of the draft notice of appeal placed before the judge for the purpose of seeking leave to appeal ran into 62 pages.  In the renewed leave application, the Court of Appeal directed the defendant to submit a revised draft notice of appeal and decided to grant leave only in respect of six grounds.  In the skeleton submissions served by the defendant in this appeal, it is indicated that he will no longer rely on grounds 1 and 2 on the defence of honest comment as independent grounds of appeal and that the matters stated therein will only be relied on in developing arguments for the defence of qualified privilege in grounds 3 and 4 insofar as necessary.

3.Of the four substantive grounds pursued on appeal, they may be summarised as follows:

(1) the judge was wrong in applying an objective or a predominantly objective test in finding malice which defeated the defence of qualified privilege, and thereby excluded most, if not all, of the factors affecting the subjective views of the defendant (grounds 3 and 4);

(2) the judge failed to take into account the evidence of Ma Chun Fat in deciding the underlying events and the defendant’s subjective views (ground 5); and

(3) the judge extensively copied from the closing submissions of the plaintiff’s counsel in drafting the Judgment, such that serious doubts have been raised on his lack of independent judgment (ground 6).

4.Mr Edward Chan, SC, who appeared for the defendant on appeal^[2] but not below, sought an order for a re-trial in the District Court before a different judge.

Background

5.For the purpose of resolving the issues in this appeal, the relevant background materials may be stated as follows.

(1) General background^[3]

6.The plaintiff and the defendant were owners and occupiers of flats in Cheerful Garden, Siu Sai Wan, Hong Kong (“the Estate”). Both had served as chairman of the owners’ committee (prior to the formation of the incorporated owners; “the IO”) and/or the management committee (“the MC”) of the IO at various times.  The plaintiff’s claim for libel was based on the publication of six articles by the defendant from March 2013 to August 2015, during the defendant’s tenure as chairman of the 2^nd MC.  They arose out of disputes concerning the management of the Estate, in particular a major renovation proposed by the plaintiff.

7.The defendant was the chairman of the last owners’ committee prior to the establishment of the IO on 14 April 2010.  He was elected the chairman of the 1^st MC.  In June 2011, the defendant and some other members resigned from the 1^st MC.  In August 2011, the plaintiff was by-elected as the chairman for the remaining term of the 1^st MC (“the By Elected 1^st MC”).  She proposed a major renovation for the Estate during her chairmanship.

8.On 22 December 2011, the By Elected 1^st MC sent out a questionnaire to owners to collect their views as to the major renovation. On 8 February 2012, at the 6^th meeting of the By Elected 1^st MC, it was resolved to commence the renovation based on the result of the questionnaire and that $10,000 would be collected from the owners of each flat.  On 15 February 2012, the legal advisor of the IO, Messrs.  Au-Yeung Cheng Ho & Tin, advised against the reliance of the By Elected 1^st MC on the questionnaire as a basis to raise funds from the owners.  The solicitors advised that an owners’ resolution passed at an owners’ meeting was necessary.

9.On 17 February 2012, the By Elected 1^st MC advertised to invite tenders for the post of consultant in relation to the proposed renovation.  On the same day, the plaintiff informed the owners that more than half of the owners who responded to the questionnaire had agreed to the renovation.

10.In the selection process for the consultant, the plaintiff relied on a scoring system from three anonymous volunteers.  The identities of the volunteers were not disclosed.

11.On 31 March 2012, at the 8^th meeting of the By Elected 1^st MC, Wong Kwong (“W&K”) was selected as the consultant for the proposed renovation.  W&K issued its consultancy report on 25 May 2012. It did not however provide a price estimate for the renovation.  On 3 June 2012, a consultation meeting was held for W&K to answer directly questions raised by the owners.

12.On 30 June 2012, the process for accepting tenders for the contractor of the proposed renovation began.  It ended on 11 July 2012.

13.On 7 July 2012, the notice for the annual general meeting of the IO to be held on 22 July 2012 (“the 2012 AGM”) was issued.  There were 18 items on the agenda, including the appointment of the security service provider for the Estate, the seeking of contribution from the owners for the proposed major renovation and the election of the chairman, other officers and members of the 2^nd MC.  The By Elected 1^st MC required that all the proxy forms to be used in the 2012 AGM must bear the chop of the IO, otherwise the proxy would be regarded as invalid.

14.On 17 July 2012, W&K interviewed the contractors who submitted tenders.  Out of 14 tendering contractors, W&K required ten to provide supplemental information, and most of them were unable to do so due to the limited time.  As a result, only four contractors were interviewed.  On 20 July 2012, two days before the 2012 AGM, W&K provided its analysis on the tenders from those contractors who were interviewed.

15.At the 2012 AGM, the major renovation proposed by the plaintiff was voted down by the majority of the owners (68.47% of the votes).  The plaintiff withdrew from the election of the 2^nd MC.  The defendant was elected as the chairman of the 2^nd MC.  As for the appointment of the security service provider for the Estate, before the votes were cast, the plaintiff announced that one of the candidates, Centurion Facility Co Ltd (“Centurion Facility”), would lower its bid to $8.7 million.  This announcement was made after the other candidates had put in their bids which were made known to the By Elected 1^st MC and all the owners.  Centurion Facility was chosen as the security service provider by a resolution passed by the owners.

16.After the 2012 AGM, there were campaigns, harassing events and disturbances in the Estate seeking to remove the defendant as the chairman.  In 2012 and 2013, there were disruptions of the meetings of the 2^nd MC, and the police was called on several occasions.

(2) The six articles

17.The 1^st Article is a leaflet published in March 2013.  The 2^nd and 3^rd Articles are leaflets dated 18 and 25 April 2013.  The 4^th Article is a leaflet dated 10 January 2014.  The 5^th Article is the minutes of the owners’ meeting on 28 February 2014 recording the words spoken by the defendant and the minutes were signed by him as the MC chairman.  The 6^th Article is a letter dated 20 August 2015 with an enclosure being extracts from the minutes of the owners’ meeting held on 23 April 2015 with revisions made by the defendant.

18.The judge found that all six articles are defamatory of the plaintiff, by considering seven categories of defamatory stings^[4]. There is no appeal against these findings.

19.It is unnecessary to set out the articles or to quote from them. The seven categories of defamatory allegations are as follows:

Categories of Defamatory Statements and Allegations	Article
(1) Defamatory statements arising from the renovation	The 1st, 4th, 5th and 6th Articles
(2) Defamatory statements arising from the tender process for the security service contract	The 2nd Article
(3) Defamatory statements arising from the replacement of the 118 Gate	The 6th Article
(4) Allegations that the plaintiff persistently attempted to seize control of the IO for ulterior motives causing chaos	The 1st, 3rd, 4th and 5th Articles
(5) Allegations that the plaintiff colluded with the management company of the Estate, Chevalier Property Management Limited (“Chevalier”)	The 6th Article
(6) Allegations that the plaintiff did not properly discharge her duty as chairman of the IO	The 1st Article
(7) Defamatory statements concerning the plaintiff’s behaviour and character, e.g. being greedy, devious, deceitful, cunning, abusive, violent and lacking in integrity	The 1st, 3rd, 4th and 6th Articles

20.The judge analysed the underlying events in respect of each category of defamatory stings and found that the underlying factual basis for the six articles is false.  He also found the defamatory stings for Categories 1 and 2 are imputations of facts^[5], without making any express findings for Categories 3 to 7.  There is no appeal against these findings.

The defences raised and the judgment below

21.The main defences advanced were justification, honest comment and qualified privilege.

22.For the defence of justification, the judge found that none of the seven defamatory stings are justified by facts and hence this defence fails^[6]. For honest comment, as the defamatory stings for Categories 1 and 2 are imputations of facts, this defence is not available for the defamatory statements that fell into those categories^[7]. Furthermore, the comments were not ones which could have been made by an honest person and/or that the defendant acted dishonestly when making the comments^[8]. Hence, all the defamatory statements do not come within the objective limits of the defence of honest comment and/or were rebutted by malice.  There is no appeal against all the above findings^[9].

23.In respect of qualified privilege, the judge found that the purpose for which the privilege is accorded on the occasions the six articles were published is consistent only with the communication of a matter believed to be true.  Having found that the underlying factual basis for the six articles is false and the defendant knew or would have known that the defamatory statements are false, he held that the defendant did not publish them for a proper purpose.  Hence, the defence of qualified privilege is defeated by malice^[10].

24.The main criticism of Mr Chan on appeal is that the judge’s approach “short-circuited” the subjective test for finding malice as regards the defence of qualified privilege, and had thereby excluded most of the subjective factors which ought to have been taken into account in finding the dominant purpose of publishing the defamatory statements.

25.There is no dispute as to the law and no suggestion that the judge’s statements of the legal principles were in error.  What is in dispute is whether he had correctly applied those principles in finding there was malice to defeat qualified privilege.  For the relevant legal principles, it is necessary to refer to only three cases: Horrocks v Lowe [1975] AC 135; Albert Cheng v Tse Wai Chun Paul (2000) 3 HKCFAR 339; and Jonathan Lu v Paul Chan Mo Po (2018) 21 HKCFAR 94.

Malice in the context of honest comment

26.We have mentioned earlier the objective limits of the defence of honest comment.  They are fivefold: the comment must be on a matter of public interest; the comment must be recognisable as comment, as distinct from an imputation of fact; the comment must be based on facts which are true or protected by privilege; the comment must explicitly or implicitly indicate, at least in general terms, the facts on which the comment is made and those to whom the comment is addressed can form their own view on whether the comment was sound; the comment must be one which could have been made by an honest person, however prejudiced he might be, and however exaggerated or obstinate his views^[11].

27.When a defendant has brought his case within these five objective limits, the plaintiff may still rebut the defence of honest comment by establishing that the defendant was “actuated by malice” when he made the comment.  Unlike the objective outer limits, malice is subjective and looks to the defendant’s state of mind.  In the context of honest comment, malice covers the case of the defendant who does not genuinely hold the view he expressed.  In other words, he acted dishonestly when making the comment^[12].

28.Proof of malice is the means by which a plaintiff can defeat a defence of honest comment where a defendant is abusing the defence, namely, by proof that the defendant did not genuinely believe the opinion he expressed.  The purpose of this defence is to facilitate freedom of expression by commenting on matters of public interest.  Honesty of belief is the touchstone.  Actuation by spite, animosity, intent to injure, intent to arouse controversy or other motivation, even if it is the dominant or sole motive, does not of itself defeat the defence.  However, proof of such motivation may be evidence, sometimes compelling evidence, from which lack of genuine belief in the view expressed may be inferred^[13].

Malice in the context of qualified privilege

29.As in the situation of honest comment, express malice is equated with use of a privileged occasion for some purpose other than that for which the privilege is accorded by the law.  But as the rationale and purpose of the defence of qualified privilege are different from that of honest comment, the misuse of the defence of qualified privilege is different.  So malice would bear different meanings in the defences of fair comment and qualified privilege^[14].

30.The rationale of qualified privilege is the law’s recognition that there are circumstances when there is a need, in the public interest, for a particular recipient to receive frank and uninhibited communication of particular information from a particular source, which outweighs the need to protect reputation.  Qualified privilege arises where the occasion is such that the person who makes a communication has an interest or duty, legal, social or moral, to make it to the person to whom it is made, and the person to whom it is so made has a corresponding interest or duty to receive it.  If a person’s dominant motive is not to perform this duty or protect this interest, he is outside the ambit of the defence^[15].

31.To decide whether a communication was published maliciously, for the purpose of rebutting the defence of qualified privilege, there are two questions to be addressed.  First, was the occasion privileged, and if so, for what purpose? Second, was that the defendant’s purpose when he published the communication in question?  The first is a question of law.  The second is a question of fact^[16].

32.Of the first question, it is not disputed that communications between the IO or MC and the owners regarding the management and administration of the Estate are capable of being covered by qualified privilege^[17].

33.As to the second question, in assessing the defendant’s purpose when he published the communication, the motive with which he did so is of crucial importance.  A person may have more than one motive or purpose for making a communication.  The critical question is whether the dominant purpose was one other than the purpose for which the occasion was privileged.  Qualified privilege would be illusory “if the protection which it affords were lost merely because a person, although acting in compliance with a duty or in protection of a legitimate interest, disliked the person whom he defamed or was indignant at what he believed to be that person’s conduct and welcomed the opportunity of exposing it”.  Accordingly, in a case where a person has published what he believes to be true, “it is only where his desire to comply with the relevant duty or to protect the relevant interest plays no significant part in his motives for publishing what he believes to be true that ‘express malice’ can properly be found”^[18].

34.The motive with which a person published defamatory matter can only be inferred from what he did or said or knew.  Such evidence will include the circumstances surrounding the making of the communication.  Evidence bearing on the defendant’s knowledge or belief as to the truth or falsity of what is communicated is only relevant in so far as it affects the answer to the critical question whether the defendant used the occasion for a purpose other than that for which the privilege was accorded.  The defendant’s knowledge or belief as to the truth or falsity of the matter communicated is significant only in so far as it is evidence from which an inference can be drawn as to the answer to that question^[19].

35.“Where the purpose for which the privilege is accorded is consistent only with the communication of a matter which is believed to be true, as is usually but not invariably the case, the defendant’s knowledge that the matter was false at the time when he communicated it, or his recklessness as to whether it was true or false, will generally be conclusive evidence that he did not make the communication for a proper purpose: normally, that is the only inference which can reasonably be drawn.”^[20]

36.“In cases where the purpose for which the privilege is accorded is consistent only with the communication of a matter which is believed to be true, the parties may therefore focus on the question whether the defendant knew of the matter’s falsity, or did not care whether it was true or false. … It should however be borne in mind that knowledge of falsity, or indifference as to truth or falsity, is not itself the test of malice: it is merely evidence from which an improper motive can often, but not always, be inferred.”^[21]

37.Since the critical issue in relation to malice is the defendant’s motive in making the communication, this motive can only be ascertained from an examination of the defendant’s state of mind.  The communication has to be understood in this context as the defendant meant it to be understood.  In short, malice is “a subjective test, entirely dependent on the defendant’s state of mind and intention”^[22].

38.Indifference to the truth of the communication is “not to be equated with carelessness, impulsiveness or irrationality in arriving at a positive belief that it is true”.  Even those who act carelessly, impulsively or irrationally are afforded immunity from suit “if they have acted in good faith in compliance with a legal or moral duty or in protection of a legitimate interest”^[23].

39.“In ordinary life it is rare indeed for people to form their beliefs by a process of logical deduction from facts ascertained by a rigorous search for all available evidence and a judicious assessment of its probative value.  In greater or in less degree according to their temperaments, their training, their intelligence, they are swayed by prejudice, rely on intuition instead of reasoning, leap to conclusions on inadequate evidence and fail to recognise the cogency of material which might cast doubt on the validity of the conclusions they reach.  But despite the imperfection of the mental process by which the belief is arrived at it may still be ‘honest’, that is, a positive belief that the conclusions they have reached are true.  The law demands no more.”^[24]

40.Prejudice, however gross and unreasoning, does not destroy the privilege unless it has had the result of rendering the defendant indifferent to the truth or falsity of the communication^[25].

41.“Judges and juries should, however, be very slow to draw the inference that a defendant was so far actuated by improper motives as to deprive him of the protection of the privilege unless they are satisfied that he did not believe that what he said or wrote was true or that he was indifferent to its truth or falsity.  The motives with which human beings act are mixed.  They find it difficult to hate the sin but love the sinner.” Furthermore, “judges should remind themselves that this burden of affirmative proof is not one that is lightly satisfied.”^[26]

42.Where the communication includes defamatory material going beyond what was necessary for the purpose for which the privilege was accorded, that material should not be treated as ipso facto falling outside the scope of the protection.  The question remains whether the defendant misused the privileged occasion for an improper purpose.  “The answer to that depends on the defendant’s state of mind, not on the objective relevance of the material.”^[27]

43.“… the proper rule as respects irrelevant defamatory matter incorporated in a statement made on a privileged occasion is to treat it as one of the factors to be taken into consideration in deciding whether, in all the circumstances, an inference that the defendant was actuated by express malice can properly be drawn.  As regards irrelevant matter the test is not whether it is logically relevant but whether, in all the circumstances, it can be inferred that the defendant either did not believe it to be true or, though believing it to be true, realised that it had nothing to do with the particular duty or interest on which the privilege was based, but nevertheless seized the opportunity to drag in irrelevant defamatory matter to vent his personal spite, or for some other improper motive.  Here, too, judges and juries should be slow to draw this inference.”^[28]

If the judge had applied a predominantly objective test in finding malice

44.Grounds 3, 4 and 5 of the notice of appeal may be considered together.  Ms Connie Lee, who appeared for the plaintiff on appeal and below^[29], did not argue that it would not be wrong in law if the judge had applied a predominantly objective test in finding malice to defeat qualified privilege.  Her contention was that the judge did not apply a predominantly objective test in finding malice, in that there was available evidence on which an inference on the defendant’s subjective knowledge and intention can be drawn. 

(1) The defendant’s submissions

45.Mr Chan submitted that in analysing the issue of malice for qualified privilege, the judge made substantial reference to his analysis on malice for the defence of honest comment, and would appear to have conflated the subjective test of malice to defeat honest comment with one of the outer objective limits that the comment must be one which could have been made by an honest person.  For Category 1^[30], he drew our attention to these paragraphs of the Judgment in the context of honest comment with emphasis on the parts that he underlined in his skeleton argument:

“119. Insofar as is necessary, I further find that the comments were made maliciously (ie they were not ones which could have been made by an honest person).

120. The defendant is well educated and very experienced with the operations of an IO.  He also had access to all relevant information and documents at the time (at least after he became chairman of the MC for the 2^nd term).  Whatever dissatisfaction he might have with the handling of the renovation proposal, and taking into account the factual bases of those comments (or the lack of them), I am unable to accept that the comments (particularly suggestions that the Plaintiff had effectively committed criminal activities) were ones that could have been made by an honest person.  For reasons given above, I am also of the view that the defendant knew that the comments he made were without any factual or evidential foundation.”

46.Mr Chan argued that upon this objective basis, the judge then found that the defendant had knowledge that the comments he made were without any factual or evidential foundation.  In other words, the finding of the falsity of the underlying events provided the basis for the finding of the defendant’s knowledge of their falsity.  As the former finding was made through an objective analysis, the latter finding must have been grounded on an objective analysis.  It must follow that factors affecting the defendant’s subjective view have not been properly taken into account (if at all).

47.These subjective factors come in two forms.  First, factors which have not been considered as they are regarded as irrelevant for the objective analysis of the underlying events.  They should have been considered as they are relevant for the subjective analysis of the defendant’s view.  Second, factors which have been considered and rejected in the objective fact finding process of the underlying events.  They should have been re-evaluated from a different perspective for a subjective analysis of the defendant’s view.

48.Mr Chan gave as examples the suggestion made by Leung But Dai at a dinner gathering with the defendant, Ma Chun Fat and others in buying votes for the passing of a resolution of the owners to renovate the Estate and the plaintiff’s involvement in the campaigns seeking to remove the defendant as the MC chairman.  He submitted that these evidence might well fall short of establishing on the balance of probabilities the existence of vote rigging or that the plaintiff had brought about disturbances in the Estate trying to seize control of the IO. However, such evidence must have been crucial factors in shaping the defendant’s belief in the existence of vote rigging and the plaintiff’s involvement in improper measures in attempting to seize control and causing chaos.

49.The judge had analysed malice for qualified privilege in this manner:

“124. My analysis on the defendant’s dominant purpose of publishing the 6 articles begins with the undeniable fact that the purpose for which the privilege is accorded is only consistent with the communication of a matter which is believed to be true. As such, the defendant’s knowledge that the matter was false at the time when he communicated it, or his recklessness as to whether it was true or false, is (at least) compelling evidence that he did not make the communication for a proper purpose: Jonathan Lu at §22.

125. I have explained above why, in my judgment, the defendant knew that the factual statements he made were untrue (or if they were comments, he was dishonest in that he knew that they were without factual or evidential foundation).  For the same reasons, I am driven to the conclusion that the defendant did not publish the 6 articles for a proper purpose.”

50.Mr Chan submitted that the errors of the judge’s analysis are two-fold.  First, the judge almost equated the finding of one’s knowledge that the factual statements one made were untrue with the finding of a dominant improper purpose.  Second, by applying one’s knowledge found as a result of an objective analysis in finding one’s dominant purpose, such process of reasoning necessarily excluded most (if not all) of the subjective factor affecting the defendant’s own belief.

51.Mr Chan referred to the legal principles we have summarised earlier: knowledge of falsity, or indifference as to truth or falsity, is not itself the test of malice but merely evidence from which an improper motive can often, but not always, be inferred; the motive with which a person made a defamatory communication can only be ascertained from an examination of the state of his mind and the communication has to be understood in this context as the defendant meant it to be understood; malice is a subjective test, entirely dependent on the defendant’s state of mind and intention.  He also placed reliance on Lord Diplock’s statements in Horrocks v Lowe at 150D to E quoted earlier.

52.Mr Chan listed a number of matters which the judge should have considered in finding the defendant’s subjective belief in holding that there was malice to defeat qualified privilege:

(1)  suspected price-rigging behind the proposed renovation and “mutual back-scratching” among the parties perceived to be acting in collusion;

(2)  the suggestion made by Leung But Dai (who was then a consultant to the 1^st MC and later became a member of the By Elected 1^st MC) at the dinner gathering aforesaid that the owners could be bribed to vote for the proposed renovation;

(3)  upon the voting down of the proposed renovation, the plaintiff’s camp launched a campaign to remove the 2^nd MC, to disturb the administration of the IO and to disrupt the day-to-day living of the residents of the Estate, by verbal and physical violence;

(4)  in one incident that shocked the residents of the Estate, over a hundred people shouted and hit the glass window of the place where a meeting of the 2^nd MC was held.  Twenty policemen attended to control the scene and there was indication of the possible involvement of triad members;

(5)  the perception of some of the owners including the defendant that the plaintiff was involved in these events;

(6)  the general support for the defendant and/or the 2^nd MC in the affairs of the Estate: only 17.10% of the votes was in favour of the proposed renovation; the plaintiff’s team suffered a landslide defeat in the election of the 2^nd MC; the endorsement by the 2^nd MC of the six defamatory articles published by the defendant; only 12.83% of the votes was in favour of removing the 2^nd MC; and the defendant was elected the chairman of the 1^st to 3^rd MCs;

(7)  other context of the publication of the six defamatory articles: events that triggered each of the articles; the accumulating effect of the events; the full contents of the publications in particular the non-defamatory parts and those stating the purposes of the publications; the defendant’s revision of some of the words in the 6^th Article as he did not see the need to be so “critical” (albeit this was contrary to the judge’s holding that the revisions reinforce rather than reduce the defamatory effect)^[31].

53.In respect of Category 4, the judge erred in that he held there was no need to decide (let alone properly consider) a number of prominent factual issues in finding malice, stating at §161 of the Judgment:

“Once these core matters are resolved, I see no real utility in determining whether there were other disturbances brought about by the plaintiff, and hence whether other defamatory stings regarding the plaintiff trying to seize control of the IO and causing other disturbances can be protected by the defences. I simply note that the defendant accepted in cross-examination that the plaintiff never used violence or abusive or foul language against him or other members of the MC, and his complaint was at most that the plaintiff spoke loudly and disrupted the meetings.”

54.As for the evidence of Ma Chun Fat, who was a member of the 1^st and 2^nd MCs, he confirmed the truth of two witness statements of the defendant, in particular the alleged improper behaviour of the plaintiff during her tenure as the chairman of the By Elected 1^st MC.  He gave further evidence of the dinner gathering he attended with the defendant and other members of the 1^st MC in which Leung But Dai made the suggestion that votes could be bought to support the proposed renovation.  He considered the price estimate for the proposed renovation unreasonable, and believed that the By Elected 1^st MC sought to push through the proposed renovation for improper purpose and this could be related to the earlier suggestion of Leung But Dai who might be connected with people involved in unlawful activities in carrying out building renovation.

55.The judge acknowledged^[32] that he did not rely on the evidence of Ma Chun Fat in deciding the underlying events and the defendant’s subjective views, as he did not think Ma’s evidence relevant. He stated that he only had to analyse the defendant’s state of mind and not anyone else’s, so how Ma felt and believed is irrelevant.  Further, as the Estate was divided into two camps at the time, it is hardly surprising that the defendant and Ma shared similar thoughts and beliefs.

56.Mr Chan argued that the judge was wrong to exclude from consideration Ma’s evidence, as what Ma saw, heard and experienced would certainly have bearing on the circumstances in which the six articles were published, particularly as the 1^st to 5^th Articles were published in the name of the 2^nd MC, in which both the defendant and Ma had served.

57.In summary, Mr Chan submitted that the approach of the judge “short-circuited” the subjective test for finding malice, and excluded most of the subjective factors to be taken into account in considering the dominant purpose of the publications.  As this approach had been applied to all six articles, the entire case should be remitted for trial before a different District Court judge on the issue of malice in the context of qualified privilege.

(2) The plaintiff’s submissions

58.Ms Lee sought to persuade this court that the defendant’s submission is a “nit-picking” approach and should not impeach the judge’s overall conclusion on malice or otherwise justify a retrial.

59.She submitted that on a proper reading of §§119 to 120 of the Judgment, the judge did not conflate the subjective test of malice in the context of honest comment with the objective limit of that defence whether an honest person could have made the comment.  She referred this court to the exchanges the judge had with counsel at the trial (in discussing the legitimacy of the additional requirement of the chop of the IO on the proxy forms) in which the judge remarked that “the defendant can genuinely maintain an objection at the time, based on his then-views, as opposed to what exactly is the correct position as a matter of law” and noted that the defendant’s belief “would be relevant intention as to subjective intentions at the time” and “that goes to malice, for the purpose of qualified privilege.”^[33] This shows that the judge was aware he should be looking into the subjective intention of the defendant in finding malice for the purpose of qualified privilege.

60.As to the finding that the defendant knew the underlying events were untrue, it is incorrect to say that this is based purely on the finding of the falsity of the underlying events.  The judge had relied on the defendant’s own admissions under cross-examination and evidence in relation to his knowledge or access to the contemporaneous documents or relevant circumstances before reaching the findings he made in §§79 to 108, 132 to 136, 148 to 154, 157 to 160, 164 to 165, 169 to 176 and 179 of the Judgment.

61.To give a few examples, in §114, the judge came to the firm view there is no evidence to show that the plaintiff would obtain personal benefits from the renovation project and noted the defendant’s concession in cross-examination there was no such evidence and it was only his own speculation.  In relation to the suspected vote rigging premised on Leung But Dai’s suggestion at the dinner gathering, Ms Lee submitted that the judge had considered this from the defendant’s perspective as the judge made the observation in §118 that the defendant had accepted that whatever he felt or heard during the gathering had nothing to do with the plaintiff or the other members of the By Elected 1^st MC.  And the defendant admitted the fact that the plaintiff had participated in lobbying for signatures does not mean she was implicated in the serious allegation there were forged signatures when the plaintiff and her team pushed for a re-election of the MC.

62.The real complaint of the defendant on appeal is that the judge should have given more weight to those matters as listed by Mr Chan in reaching the finding of his subjective intention or purpose.  The appeal court has deprecated the attempt to advance again with greater or different emphasis submissions on the evidence and factual aspects that did not find favour with the trial judge.

63.As for the evidence of Ma Chun Fat which the judge acknowledged he did not take into account, Ms Lee contended that his evidence would not have led to a different outcome on the finding of malice for the reasons given by the judge.

64.Ms Lee submitted the judge is entitled to find at §124 that in the present circumstances the privilege accorded is consistent only with the communication of a matter believed to be true.  It follows that the defendant’s knowledge that the matter is false is compelling evidence that he did not make the communication for a proper purpose.

65.Furthermore, the judge had also considered other relevant evidence and circumstances before reaching the conclusion that the defendant did not make the communications for a proper purpose, as would appear from these parts of the Judgment:

“121. Ultimately, whatever imperfections there might be regarding the way the renovation was proposed or handled, it is not open for the defendant to escalate his comments and allegations against the plaintiff to a wholly different level of seriousness including that of “improper motive”, “attempts to obtaining personal benefit” and “deceiving owners”. Whilst actuation by spite, animosity, intent to arouse controversy or other similar motivation does not by itself defeat the defence of honest comment, proof of such motivation may be evidence (sometimes compelling evidence) from which lack of genuine belief in the view expressed may be inferred: Albert Cheng at 360J-361A. I am satisfied that this is clearly such a case.”^[34]

“126. This conclusion is further reinforced by the fact that, once the renovation project was voted against by the owners at the 2012 AGM, it has never re-surfaced as an issue for any subsequent owners’ meeting (and this is confirmed by the defendant). As a consequence, I am unable to see any point or utility in repeating the issue in March 2013, let alone in August 2015 (when the 6^th Article was published and when the renovation has been voted down for a full 3 years), as if it were an issue of ongoing interest^[35].

127. On this basis, it is plain that the defamatory statements regarding how the renovation project was once handled during the term of the plaintiff’s office was not germane to the privileged occasions.

128. The defendant seeks to explain that there were on-going disruptions in the Estate to justify the ongoing discussion of the issue. I reject that explanation. For example, the 6^th Article did not really address any ongoing disruptions or campaign. The focus was clearly how the renovation project was handled.

129. I also accept the plaintiff’s submission that the defendant’s revision of some of the words in the 6^th Article is evidence against him in this regard. The defendant explained that the changes were made as he did not see the need to be so “critical” (尖銳), but I am unable to accept that explanation; on a proper reading, the revisions reinforces rather than reduces the defamatory effect of the statements. The natural inference of making these changes (which aggravates the defamatory effect of the statements) is consistent with the fact that the defendant did not publish (at least) the 6^th Article for a proper purpose.”

66.Ms Lee impressed upon us that a re-trial is costly for the parties, time-consuming for the parties and the court, and provides an opportunity for the parties to tailor their evidence^[36]. Under Order 59 rule 11(2) of the Rules of the High Court, the Court of Appeal shall not be bound to order a new trial on the ground of misdirection, or of the improper admission or rejection of evidence, unless in its opinion there is some substantial wrong or miscarriage of justice.  However serious the error, if the Court of Appeal takes the view that ultimately it would have made no difference to the outcome of the case, a new trial will not be ordered.  There is another facet to the exercise of this discretion: a retrial will be ordered not only where it is just to do so, but where it is right to do so.  If the Court of Appeal is in as good a position as the trial judge to take a fresh view of the facts, a new trial will not be ordered.  It is only where the Court of Appeal is disadvantaged in looking at and determining questions of fact that an order for a new trial will be seriously countenanced^[37].

67.Ms Lee submitted that this is far from a right case for re-trial, as there is simply no miscarriage of justice or substantial wrong and the overall conclusion or result cannot be impeached.

(3) Analysis

68.The judge had stated the legal principles correctly and was apparently aware, from his exchanges with counsel, that he would need to apply a subjective test dependent on the defendant’s state of mind and intention at the time the communications were made in order to find malice that would defeat qualified privilege.  The problem with the Judgment is whether he had indeed applied the correct test and approach in considering malice in this context.

69.The problem arose from the way the Judgment was structured. We take as an example section H of the Judgment dealing with Category 1 of the defamatory stings.  The judge began with an analysis of each of the defendant’s complaints against the relevant background and context, and made findings of the underlying facts of each complaint.  In this exercise, apart from the objective facts and the plaintiff’s evidence, he took into account (rightly) the defendant’s admissions of his knowledge of various matters put to him in cross-examination and drew the inference on the evidence he considered that the complaints were of no substance (as he was entitled to do). 

70.Next, he turned to consider in this order the defences of justification, honest comment and qualified privilege.  In rejecting the defence of justification, he took into account his findings of the underlying facts and that the complaints were of no evidential basis and substance.  In respect of honest comment, he rejected this defence as the stings are not based on true facts on the analysis of the underlying facts he had made earlier.  Insofar as necessary, he further found that the comments were made maliciously in that they were not ones which could have been made by an honest person.

71.When the judge came to qualified privilege at last, he stated that this “can be briefly disposed of, because [he has] no hesitation that it is defeated by malice”^[38]. He began his analysis with the finding that the privilege accorded is consistent only with the communication of a matter believed to be true, and hence the defendant’s knowledge that the matter was false or his recklessness as to whether it was true or false is compelling evidence he did not make the communication for a proper purpose.  He then referred to his earlier findings of the defendant’s knowledge that the statements he made were untrue, or if they were comments he was dishonest in that he knew they were without factual or evidential basis.

72.In our judgment, the problem is not so much the finding that the privilege accorded is consistent only with the communication of a matter believed to be true, as this is a finding he would be entitled to make provided there is good reason for it.  This was not fully argued by Mr Chan and we do not need to determine this for the purpose of this appeal. The difficulty we have with the judge’s approach is his finding of the defendant’s knowledge, intention and state of mind at the time the communications were made in holding that the defendant did not make the communications for a proper purpose.

73.It is not entirely clear whether the judge had indeed conflated the subjective test of malice in the context of honest comment with the objective limit of that defence whether an honest person could have made the comment, as submitted by Mr Chan.  At the very least, we think there is ambiguity in §§119 to 120 and 125 of the Judgment whether the judge had applied a predominantly objective test in arriving at the view that the defendant knew the comments were without factual or evidential foundation and was dishonest.

74.The defendant’s admissions of the various matters put to him in cross-examination do not in themselves constitute evidence of his knowledge and state of mind at the time he made the communications, although his admissions may be evidence on which an inference could be drawn as to his knowledge at the time.  His acceptance under cross-examination that his complaints were without evidential basis and just his speculation does not in itself constitute evidence that the defendant knew at the time the statements he made were untrue or had no factual basis, although again this is evidence on which an inference could be drawn. Whether such an inference of knowledge could properly be drawn must rest on a consideration of all the relevant circumstances surrounding the making of the communications, and should include the matters listed by Mr Chan as they could (not must) have some bearing in shaping the defendant’s belief, intention and thinking at the time.

75.Furthermore, in deciding whether to draw such an inference, the judge should be guided by the approach that the court should be slow to draw the inference that a defendant was so far actuated by improper motives as to deprive him of the protection of the privilege, unless it is satisfied that the defendant did not believe what he said or wrote was true or was indifferent to its truth or falsity.  He should also bear in mind that in ordinary life it is rare for people to form their beliefs by logical deduction from facts ascertained by rigorous search of all available evidence and judicious assessment of the probative value of the evidence.

76.Hence, we do not agree with the judge that the evidence of Ma Chun Fat is irrelevant for this exercise.  Ma’s evidence might (not must) provide context for the defendant’s state of mind at the time and might thereby show that the defendant had acted in good faith and did believe what he published to be true, even though he might have acted carelessly, impulsively or irrationally at the time.  Similarly, the defendant’s acceptance that the plaintiff did not use violence or abusive or foul language against him and other members of the MC is not a valid reason for excluding from consideration the evidence of the disturbances in the Estate and the plaintiff’s lobbying for signatures in a campaign to remove the 2^nd MC.

77.We recognise that the judge had given other reasons (at §§121, 126 to 129, 155, 165 and 180) in arriving at the conclusion that the defendant did not make the communications for a proper purpose.  But we are unable to say that those reasons would be sufficient in themselves to support the judge’s conclusion or that the evidence he excluded would have made no difference to the conclusion.  Where the communication includes defamatory material going beyond what was necessary, that material should not be treated as in itself falling outside the protection of the privilege.  The objective relevance of the material is insufficient, it remains necessary to consider the defendant’s state of mind and whether an inference can properly be drawn in all the circumstances that he did not believe what he said or wrote was true or was indifferent to its truth or falsity but seized the opportunity to drag in irrelevant defamatory matter for an improper motive.  We are not able to determine on the evidence the question of fact whether the defendant knew at the time what he published was false or that he was reckless as to whether it was true or false.

78.We have considered the judge’s reasoning in finding malice to defeat qualified privilege in respect of the defamatory stings in Categories 2 to 7.  We are of the view there are similar flaws in the reasoning.  It is unnecessary to set out our analysis in respect of each category, as it is not materially different from the method we adopted for the analysis in respect of Category 1.

79.For all the above reasons, we are satisfied that it is appropriate to exercise our discretion to order a re-trial of this case before a different judge of the District Court, limited to the issue of malice in the context of qualified privilege.  We would allow the appeal on this ground.

If there is serious doubt the judge had failed to exercise independent judgment on account of copying from the plaintiff’s submissions

80.We would deal with this ground as succinctly as we can.

81.Annexed to the notice of appeal is an excerpt of the relevant parts of the Judgment, with the parts copied from the plaintiff’s closing submissions highlighted in yellow.  They are found in sections H, I, J, K, L, M and N, and relate to the discussion of the defences of justification, honest comment and qualified privilege in respect of the seven categories of defamatory stings.

82.The defendant’s complaint is that the copying in these sections is extensive, the copying goes to the framing of issues, the choice of relevant facts to be considered and the analytical approach adopted. Examples were listed by Mr Chan to show that errors were made in both the plaintiff’s closing submissions and the Judgment, and this, he submitted, cast serious doubt whether the judge had applied independent reason and logic in the writing of the Judgment.

83.The errors complained of by Mr Chan were matters that featured in the closing submissions of the defendant’s trial counsel, but were misunderstood by the judge, or were not dealt with by him, or were omitted from his consideration.  Of the evidence omitted from consideration which Mr Chan said is material^[39], they are not even pleaded in the amended defence as facts relied upon, as pointed out by Ms Lee.  And criticisms were made of various mistakes in the plaintiff’s closing submissions adopted by the judge in directly copying from those submissions, despite the submissions of the defendant to the contrary.

84.In the first place, we do not think there is large-scale copying of the plaintiff’s closing submissions as to cast serious doubt whether the judge had applied an independent mind in his analysis of the factual and legal issues to arrive at the conclusions in the Judgment.  The Judgment consists of sections A to R. In sections A to G, he set out the background, the issues, the case of each party in summary, his analysis of the defamatory meaning of the articles, and the legal principles of the defences raised.  In sections O to R, he dealt with a statutory defence, the quantum of damages, the granting of an injunction and the conclusion.  There is no complaint of copying for all these parts.

85.The complaint of copying is in respect of the analysis of the seven categories of defamatory stings in sections H to N with regard to the defences of justification, honest comment and qualified privilege.  Looking at the parts highlighted as copied, as rightly pointed out by Ms Lee, they are mostly references to the complaints made by the defendant as pleaded in the amended defence, the background and context against which the articles were published as derived in large part from contemporaneous documents such as minutes of meetings, and summaries of the contents of various contemporaneous documents.  We do not find it unacceptable for the judge to extract those parts from counsel’s submissions and adopt them in his judgment.

86.When the judge came to analyse the defences of justification, honest comment and qualified privilege for each category of defamatory stings, it is quite clear from the parts highlighted that there was no large-scale copying of the plaintiff’s submissions.  The entire section (H9) relating to qualified privilege for Category 1 was not highlighted. The way the Judgment was structured in the discussion of the three defences, which gave rise to Mr Chan’s submission that the judge had “short-circuited” the subjective test for finding malice, is the judge’s own approach and reasoning.

87.As we see it, the real complaint of the defendant is that the judge did not deal with or appear to have considered the matters advanced in the defendant’s closing submissions.  Whether the judge had wrongly failed to deal with or consider the defendant’s submissions is beside the point.  It is not necessary to analyse the validity of the defendant’s complaints as they have no bearing to the present issue.

88.We do not think a reasonable person apprised of all the relevant facts would conclude in this instance that the judge had not put his mind to the issues and made an independent judgment.  The presumption of judicial integrity and impartiality has clearly not been displaced by the incorporation of some of the materials in the plaintiff’s closing submissions in the Judgment.  The presumption carries considerable weight, cogent evidence is required for its rebuttal and this kind of allegation should not be lightly made^[40]. We reject this ground of appeal.

Conclusion and costs

89.We therefore allow this appeal and remit the case for re-trial before a different judge of the District Court, restricted to the issue of malice in the context of qualified privilege.

90.We make the following costs orders, which are in the nature of orders nisi.

91.For the costs of this appeal, we award two-thirds of the costs to the defendant.  The one-third reduction is due to the unmeritorious ground pursued by the defendant regarding extensive copying and the late abandonment of grounds 1 and 2 as independent grounds of appeal.  There will be a certificate for two counsel only.

92.We set aside the costs of the application for leave to appeal before the judge, which were awarded to the plaintiff on an indemnity basis. We replace this with an order there be no order as to costs.  This is due to the undisciplined and inappropriate approach taken by the defendant’s trial counsel in placing before the judge a draft notice of appeal of inordinate length attacking every conceivable finding of fact, a few of which were dressed up as questions of law, in an attempt to re-run most of the points taken at trial^[41].

93.We set aside the order made by the judge of the costs of the trial and replace this with an order that the costs of the trial before Deputy District Judge Lung be reserved to the judge hearing the new trial. We decline to order the costs of the trial to be in the cause of the re-trial, as proposed by Mr Chan.  In light of quite a number of issues found in the plaintiff’s favour in the Judgment, it seems to us there ought to be an apportionment of costs, irrespective of the outcome of the new trial.

94.Any application for variation of the above costs orders nisi should be made within 14 days of the handing down of this judgment.

Ms Connie Lee and Ms Ellen Pang, instructed by H L Wong & Co, for the plaintiff (respondent)

Mr Edward Chan SC, Mr Ken To and Mr Li Pak Hei, instructed by Liu, Chan & Lam, for the defendant (appellant)