Chau Mei v. Gerald Arthur Harknett, Acting Commissioner of the Independent Commission Against Corruption

HCA002188/1977

-----------------

-----------------

Coram: Cons, J.

Date of Judgment: 14th March 1978.

-----------------

JUDGMENT

-----------------

1. On the 18th July last year the Acting Commissioner of the Independent Commission Against Corruption (the "Commissioner") served notices upon the two plaintiffs with whom I am concerned in these proceedings and who are respectively the wife and mother of a person currently under investigation by the Commission. The Commissioner purported to act in the exercise of powers conferred on him by section 14(1)(d) of the Prevention of Bribery Ordinance, Cap.201. The material parts of that section read:

"In the course of any investigation into, or proceedings relating to, an offence alleged or suspected to have been committed by any person under this Ordinance, the Commissioner may by written notice require-

2. Failure to comply with the notice without reasonable excuse renders the recipient liable to a fine of $2,000 and imprisonment for one year.

3. The matters specified in the two notices, which were in effect identical, are many. In very brief outline the Commissioner required the recipients to disclose in full and precise detail in respect of a period of ten years or more:

4. The Commissioner gave the recipients twenty-eight days from the date of the notice to comply with his requirements. They did not do so. Instead they have brought the two actions before me now in which they seek declarations that the notices are "ultra vires, null, void, invalid and/or of no effect" and that they are unenforceable.

5. Counsel for the plaintiffs attacks the notices in two ways. The first is formal or technical. He contends that the Commissioner has demanded more than he is permitted by the statute. The second goes to the substance of the demands. Counsel contends that they are unreasonable and oppressive.

6. There is no prescribed from which the notice in question should take. In the present instances the Commissioner first set out the address and telephone number of the Commission and the name and address of the recipient. Then he put a suitable heading and recited the fact of the investigation into the son or husband as the case may be, that he believed that the recipient was acquainted with facts relevant thereto and the authority by which he purported to act. Then he wrote "by this written notice I require you to furnish to Mr. Norman Frank WHITE, an investigating officer of the Independent Commission Against Corruption, the following:-". Then followed in detail the matters I have briefly outlined already.

7. Counsel's main point on the formal or technical aspect is short but effective; the Commissioner did not follow his general demand for information with words to the effect of "in so far as it may be in your possession"; that is all he is entitled to demand; by going further he vitiated the whole notice. Counsel referred me to several authorities in support of his argument. They are mostly concerned with instances of statutory forms or requirements and are of little help except perhaps, if it were necessary, to emphasise that in general the courts will be strict in the construction of sections of this nature. Counsel for the Attorney General submits that the recipient, whether lawyer or layman, would naturally and certainly realise that he was only required to disclose what was in his possession. With respect I do not agree. In regard to the first head of inquiry, for example, the bank accounts, an average person is unlikely to have kept his bank statements for so long as ten years. On receiving a notice in this form he would, in my view, feel bound to approach his bank for copies. Likewise, if his dealings in shares over that period were numerous, he would feel bound to approach his broker for details. Counsel for the Attorney suggests that a good citizen would be happy to go to this trouble. Perhaps that is so, but the statute does not require him to. If he sought the advice of his solicitor, he would be so advised. But he should not be left in that situation. To borrow the comments of Megarry, J., as he then was, in Royal Bank of Canada v. Inland Revenue Commissioners ⁽¹⁾

"The recipient of such a notice ought not to be driven to his lawyer to find out .... precisely what words of restriction are to be implied, when the commissioners could so easily have inserted those words".

By failing to insert those words in the present notices the Commissioner has in fact demanded more than he is allowed and in my view the notices are bad. I appreciate that this is purely a technical point. It is not backed by any moral or practical merit whatsoever. But to be fair to counsel for the plaintiffs, he has at no time suggested that this is so. By the Ordinance the Commissioner is given very extensive powers to invade the privacy of the individual. It is up to him to see that those powers are not, even inadvertently, overreached.

8. A further argument on the formal aspect was that the notices did not specify an address to which the information should be furnished. This argument was based on comments in the Australian case of Ganke v. Deputy Federal Commissioner of Taxation ⁽²⁾. With respect this is commonsense. A person cannot be expected to furnish information to the thin air. But it is equal commonsense that the address at the head of the notice is where the recipient should send or take the information. This argument would have failed.

9. In view of the decision I have come to on the first aspect of counsel's argument it is not strictly necessary to deal with the second. But in deference to counsel's argument and bearing in mind that the Commissioner may well issue further notices to the plaintiffs, it may be of some assistance if I express briefly the view I would have taken.

10. According to the plaintiffs' submissions the unreasonableness of the demands lay in their all-embracing nature. The financial transactions were not limited to monies paid to or received from the person under investigation whether directly or indirectly; the property affairs were not limited to properties which might have been acquired for or held on his behalf; matters such as wages and living expenses are purely private affairs which could by no stretch of the imagination be said to be "facts relevant to (the) investigation"; furthermore, the failure to specify in the notices what particular offence was being investigated made it even more difficult to decide whether any facts were indeed relevant or not. The demands were unreasonable because they required such detail over such a long period of time that no person should be subjected to the task that would be needed to satisfy them.

11. Counsel for the Attorney first questioned the jurisdiction of the court to inquire into this aspect. He said that he had been unable to find any authority in which the court had exercised an inherent power to set aside a notice served pursuant to a statutory power. If that be so - and certainly no such authority was put before me - it may merely indicate the commendable restraint shown by those entrusted with the exercise of wide powers. Nevertheless I am confident, like my brothers in the English jurisdiction*, that in appropriate circumstances the court would be entitled to intervene.

12. However in my view the present circumstances would not be appropriate. Facts relevant to an investigation are not just those matters which may indicate to the Commissioner that an offence has been committed. They extend to matters which might assist the Commissioner in the proof of the guilt of the suspect in court or in the disproof of matters which the suspect might there put forward in his defence. In the present instance the two recipients are intimately related to the person suspected and the matters specified are those which experience shows are commonly canvassed in lengthy corruption trials. I do not think that the Ordinance requires the Commissioner to inform the recipients what particular offence he has in mind. It is sufficient that he has either made an allegation or entertains a suspicion. That has not been questioned here.

13. I accept that it might not have been easy for the recipients to comply with the notices. The inquiries might have caused them to tax their memories to some extent. Even if they had kept the necessary records it might have taken them quite a while to reduce the information to writing. Of course a lot would have depended upon whether, economically speaking, they led a busy life or not during those ten years. No evidence was called to show me this one way or the other. But on their face I would not have said that the inquiries were oppressive. The Commissioner allowed in effect twenty-six days for the information to be furnished. It is said that this in itself was unreasonable and thus another ground for setting aside the notices. I do not agree. Subsection (4) clearly envisages that further time may be requested. This ought to be done before any complaint is made. If further time be refused it might perhaps be a ground for setting aside, although even then, it would in my view be usually more appropriate to leave the Commissioner to prosecute and see if it then amounted to "reasonable excuse".

14. A final argument was that as the Commissioner had already seized certain documents and articles belonging to the recipients he was already in possession of the information requested and, therefore, likewise precluded from asking for it again. Annexed to the writs were lists of those documents and articles. They appear to comprise jewellery, bank documents, share certificates and title deeds. Further than that I do not know. Without more evidence it is impossible to say whether there is any factual basis for the argument suggested.

15. For the reasons I gave in the first part of this judgment the plaintiffs may have the declarations that they seek, i.e. that the notices in question are unenforceable and of no effect.

16. g> Plaintiffs to have their costs.

Representation:

A.W. Sedgwick (Gunston & Chow) for the plaintiffs.

G. Fuller, Counsel for the Crown, for the defendant.

(1) 1972 Ch. 665 at 677

(2) 1975 Australian Tax Cases 4097 at 4100

* Megarry J. in Royal Bank of Canada v. Inland Revenue Commissioners 1972 Ch. 665 at 677 and Ackner J. in Clinch v. Inland Revenue Commissioners 1974 Q.B. 76 at 92.