The Queen v. Richard Wallis

HCA000117/1985

High Court Criminal Case No. 117 of 1985

IN THE HIGH COURT OF JUSTICE

HONG KONG

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BETWEEN

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Coram: Hon. Hooper, J. in Court

Date of hearing: 7th November 1988

Date of delivery of ruling: 14th November 1988

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RULING

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1. This is an application for costs by Mr Richard Wallis who was acquitted by me on the 20th May this year under the provisions of section 51A of the Criminal Procedure Ordinance. The application was listed for hearing on the 7th November for the determination of two preliminary points on the basis that the determination of either of these points in favour of the Crown would, effectively determine the application as a whole without the necessity for a detailed consideration of the depositions taken at the committal proceedings.

2. The history of the matter can be summarised as follows:-

Mr Wallis was charged on the 21st May 1984 with conspiracy together with George Tan and others. He denied the charge. On the 9th April 1985 after a hearing of six months, the accused George Tan, Bentley Ho Kwai-chuen and Richard Wallis were committed for trial on the charge of conspiracy to defraud in relation to the sale of Gammon House to Bylamson & Associates (Nominees) Limited, the magistrate having found that they had a case to answer.

At the time Tan and Ho, together with others were committed for trial on a further charge of conspiracy to defraud. Subsequently, a voluntary bill was granted by the High Court as a result of which Rogerio Lam and Stephen Lam were included as defendants on this further charge.

When the case came before Barker, J.A. (sitting at first instance), he ordered that the two counts of conspiracy to defraud were to be heard separately. The Crown elected to proceed at that time with the second of the abovementioned conspiracy charges, leaving the Gammon House charge to be dealt with later. The trial of the second charge, now known as the Carrian trial, proceeded and lasted some eighteen months and concluded on the 15th September 1987. Subsequently, that decision was the subject of a reference by the Attorney General to the Court of Appeal. The Court of Appeal's decision was delivered in November 1987.

The proceedings relating to the Gammon House charge came before me on the 20th May this year when the Crown offered no evidence agianst the defendants and asked that they all be acquitted under s.51A of the Criminal Procedure Ordinance. At that time, in addition to the present Gammon House charge, the accused Tan and Ho were facing charges together with Lorrain Osman and

others of conspiracy to defraud and corruption relating to the affairs of Bumiputra Malaysia Finance Limited. Lorrain Osman was arrested in London in December 1985 and has opposed the application of the Hong Kong Government for his extradition to Hong Kong. Mohamed Hashim Shamsudin who was arrested at the same time as Osman in connection with the same matter returned to Hong Kong in 1986 and the case against him has been finalised.

On the 1st of June 1987 an order was made by the Bow Street Magistrates Court, London, committing Osman into custody pending an order for his return to Hong Kong. He appealed against the order, and, on the 30th March 1988, the Divisional Court upheld the Magistrate's order in respect to charges relating to approximately US$750 million. The Divisional Court refused leave to appeal to the House of Lords on the 29th April 1988. On the 10th May1988, Osman gave notice of his intention to apply for leave to appeal to the House of Lords. "

3. So that was the position when the Attorney General took his decision to invoke s.51A to bring the Gammon House trial to an end.

4. Mr Grossman for the Crown explained the reasons for the decision as follows : -

"....... the public interest is the paramount consideration. The following factors have been particularly relevant to the making of that decision -

In these circumstances, the Attorney General is of the view that the public interest is best served by putting an end to the criminal proceedings in relation to the Gammon House charge and by doing so now. That being so the Attorney General states that he offers no evidence against the defendants on count one in the indictment and asks that all the defendants be discharged. "

5. So it appears that the Attorney General was motivated by considerations which he perceived to be in the public interest as preventing unacceptable oppression against the defendants.

6. I acceded to the Crown's suggestion and ordered that verdicts of not guilty be entered which resulted in their acquittal. Of all the defendants who were acquitted, only Richard Wallis through his counsel, Mr Alderdice, indicated that he would be applying for costs. The matter was adjourned to a date to be fixed by the Registrar for a hearing on such an application. The matter comes before me for the hearing of the two preliminary points as follows:-

The Jurisdiction Question

7. It is common ground that there is no jurisdiction at common law to award costs to an acquitted defendant and that the determination of the question of jurisdiction turns on the construction to be placed upon two sections of the Criminal Procedure Ordinance, Cap. 221, namely ss. 51A and 73A, both of which were added to the Ordinance at different times.

8. Section 51A was added to the Ordinance in 1971. It provides as follows :-

"51A. Where an accused person arraigned on an indictment pleads not guilty and the prosecutor proposes to offer no evidence against him, the court before which the accused person is arraigned may, if it thinks fit, order that a verdict of not guilty shall be recorded without the accused person being given in charge to a jury, and the verdict shall have the same effect as if the accused person had been tried and acquitted. "

9. Section 73A was added in 1978. It is in the following terms :-

"73A.    (1)     Where after trial in the court a person is acquitted, the court may order the payment out of the public revenue of the costs of the defence, including the costs of any proceedings before a magistrate.

(2)    The costs payable to any person under this section shall be such sums as appear to the court reasonably sufficient to compensate that person for any expenses properly incurred by him in or about the defence.

(3)    The amount of costs ordered to be paid under this section shall, except where the amount is fixed by the court, be ascertained by the Registrar.

(4)    In this section, 'court' means the High Court and the District Court. "

10. Mr Grossman for the Crown submits that the Court does not have jurisdiction to award costs in a situation where a person has been acquitted in the peculiar circumstances of s.51A, because of the use of the words in section 73A "after trial". He argues that there has been no trial and relies on R. v. Tonner & Others [1985]1 E.R.l 807, a decision of the English Court of Appeal, to support his proposition that the trial does not start until the jury has been sworn and is seised of the issue. However, whatever view is taken of the decision in Tonner's case, he maintains that it is clear on the facts of this case that the trial did not commence.

11. He argues that the two sections must be read together and that their combined effect is that costs can only be awarded "after trial" and not just where the person has been acquitted. Unless the legislature intended that there should be a trial in the proper sense, there would be no need to put in these words, bearing in mind that s.51A was in existence when S.73A was promulgated.

12. He argues that s.51A operates in restricted cases where the prosecution has decided to offer no evidence and the Court has exercised its discretion. The intention was to protect the acquitted defendant from any suggestion that the acquittal was of a lesser status than an acquittal after trial. It does not say that the verdict has the same effect including the discretion that the judge may have to award costs. The words "as if" in s.51A have to be construed in the light of this Ordinance. An award of costs under s.73A is an exercise of a discretion which can only be made on an examination of the facts and here, the Court knows nothing of the facts. It could not have been intended by the legislature that the Court should exercise a discretion where there is nothing upon which to exercise it.

13. Mr Mills-Owen for Mr Richard Wallis points out that there is no authority for the construction of the words "after trial" in s.73A. Assuming that the trial only starts when the jury is sworn and seised of the case, he argues that s.51A says "the verdict shall have the same effect as if the accused person had been tried and acquitted" and that these words are not limited in their application. On the other hand, they are "entirely general". Whether the events which took place before the Court on the 20th May was a trial or not, it must be treated as a trial. He further argues that Tonner's case does not state the true position in Hong Kong as to when the trial begins, because of s.41(3) which provides, inter alia, "..... where any issue arises in the trial as to the admissibility of any evidence, such issue may be determined before the Jury is empanelled". These words, he says, indicate that the trial commences before the Jury is in empanelled. No such provision exists in England. Mr Mills-Oven suggests that the position in Hong Kong is different from elsewhere and postulates that s.41(3) gives statutory recognition in Hong Kong to the reality that the trial starts when the accused is arraigned. He suggests that the terminology in s.73A is adopted in the light of the existing wording in s.51A and that s.73A does not propose to exclude a s.51A acquittal. The words "after trial" in s.73A are part of the phrase "after trial in the Court" and these words were necessary to designate in which Court an award of costs could be made.

14. Mr Grossman answers this latter point by arguing in effect that the addition of the words "after trial" do not assist in designating the Court, because the word "Court" is already there.

15. The answer to the jurisdiction question depends upon the construction of the relevant sections of the Criminal Procedure Ordinance.

16. By s.19 of the Interpretation and General Clauses Ordinance, I am enjoined to regard the Criminal Procedure Ordinance as being remedial and to give it such fair, large and liberal construction and interpretation as will ensure the attainment of the object of the Ordnance according to its true intent, meaning and spirit.

17. It is common ground that at common law an acquitted defendant could not be awarded the costs of his defence.

18. This is a matter which needed to be remedied and the Ordinance was amended to enable the Court to exercise a discretion to award costs in favour of such a defendant.

19. It is common ground that ss.51A and 73A should be read together.

20. In s.73A, ("the jurisdiction section"), the words used are "after trial". In s.51A, ("the same effect section"), the words used are "shall have the same effect as if the accused person had been tried and acquitted".

21. Reading these two sections together, it appears to me that the intention of the legislature must have been that the effect of an acquittal after trial in the Court was the provision of jurisdiction to the Court to award costs to the acquitted defendant and that a person acquitted under "the same effect section" should be treated as if he had been acquitted after trial in the Court, thus providing the Court with the same jurisdiction to award costs.

22. The legislature was aware of the terms of "the same effect section" when "the jurisdiction section" was promulgated and it would have been easy in the amending Ordinance to insert an amendment to the former to exclude such an effect if that was intended.

23. Furthermore there is no logical reason why an acquitted defendant against whom no evidence has been led at all should be placed in a less advantageous position than one against whom evidence was led.

24. I do not consider it necessary to decide when a trial starts in the Court, though it must follow from s.41(3) that the trial may start before the Jury is empanelled. It would also appear to follow from s.51A that it does not start when after arraignment and a plea of not guilty, the prosecutor proposes to offer no evidence, because if it did start then, there would be no need to provide that the verdict should have the same effect as if the accused person had been tried and acquitted.

25. In my judgment I have the jurisdiction to award costs and the answer to the first question is "yes".

The Double Option Question

26. Both counsel agree that the practice in Hong Kong must follow the practice in England as stated by Penlington J. (as he then was) in Ng Yui-kin [1983] H.K.L.R. 356 which approach was accepted by the Court of Appeal in Lee Chiu-chu [1986] H.K.L.R. 381.

27. The Practice Direction in England is reported in the All England Law Reports for 1981, Vol. III at page 703. It refers to the Costs in Criminal Cases Act of 1973.

28. Paragraph 4 of that Practice Direction directs "It should be accepted as normal practice that an order should normally be made for the payment of costs of an acquitted defendant ..........under s.3 of the 1973 Act unless there are positive reasons for making a different order. Examples of such reasons are :-

29. It is common ground that (a), (b) and (c) are only examples of positive reasons for mating a different order and that the reported judgment of the Court of Appeal in R. v. Lee Chiu-chu referring to "possible" reasons instead of "positive" reasons is wrong. That is clear from a reading of the Practice Direction itself and the other cases in Hong Kong where it has been referred to and set out.

30. It is also common ground that example (a) is not appropriate in Hong Kong at the present time because there is no legislation similar to s.4 of the 1973 Act.

31. Mr Grossman argues, in the event of his contention on the jurisdiction point not finding favour with the Court, that the circumstances in which Mr Wallis was acquitted is a matter which the Court can take into account in the exercise of the discretion to award costs. He argues that at this stage the Court is in a position to exercise its discretion against awarding costs, or alternatively, if the Court is not prepared to do so, it can find that it is a factor to be taken into account when the Court ultimately comes to examine the committal proceedings.

32. In support of his first contention, Mr Grossman submits that the discretion can only be exercised on an examination of the facts at the trial. The fact that a person has been committed for trial is not enough. The Attorney General had two possibilities open to him

33. Mr Grossman reiterates that the Attorney General decided to offer no evidence and invited the Court to exercise its discretion in the fairest way to acquit the defendants to prevent the charge hanging over the defendants in the future. In other words, he acted in a way which he perceived was in the public interest.

34. In these circumstances, he says that the Court was unable to consider the matter on the merits, but it could say that because the Attorney General could have entered a Nolle Prosequi (1st option) instead of invoking s.51A and offering no evidence on the basis that it was in the public interest (2nd option), he should not be put in a worse position than if he had adopted the first alternative.

35. Further he argues that the second option is to be considered as analagous to a technicality in example (c) in the Practice Direction and that it would be open in Hong Kong for the Court to refuse to award costs when the Attorney General has adopted the second option resulting in no decision on the merits. He says that the Court should accept, at face value, what the Attorney General says, that he acted in the public interest.

36. Mr Mills-Owen contends that because the normal practice is that an order should normally be made in favour of the acquitted defendant, the onus is on the Crown to prove that the circumstances justify the Court in declining to exercise its discretion in his favour.

37. He stresses the words in example (c) and says that the Crown must show that the defendant was acquitted on a technicality "which had no merit".

38. So far as the two possibilities open to the Crown are concerned, he submits that the option to enter a Nolle Prosequi is irrelevant to a consideration of costs, and in any event, it would have been wrong for the Crown to enter a Nolle Prosequi in the circumstances of this case. He cites on this latter contention a passage in "The Attorney General Politics and The Public Interest" by John L1. J. Edwards which was published in 1984. I do not propose to set that passage out because I do not consider it assists me in this matter. I have referred to it as it might be of interest to anyone who reads this ruling.

39. He submits that it is a startling proposition that the Court should accept at face value what the Attorney General says, because that would be substituting the Attorney General's discretion for that of the Court. It cannot be right, he says, that because the Attorney General has taken a certain view, the discretion can only be exercised in his favour.

40. He stresses the fact that the accused has been acquitted on a charge which he has strenuously denied and in respect of which he has incurred substantial costs.

41. He queries whether the Crown has informed the Court why it did not proceed with the trial in September last year when the trial on the second count came to an end. The defence, he says, sees the situation as one where the Crown would not like to be seen to lose again.

42. Mr Grossman replies that the reasons for the Crown's election to proceed under s.51A were fully before the Court on the 20th May.

43. I will say at once that I find the prosecution argument untenable, that because there has been no consideration of the merits at this stage, the Court should exercise its discretion in the Crown's favour by accepting at face value the Attorney General's stated reasons for his decision. I agree with Mills-Owen that the possible entry of a Nolle Prosequi is irrelevant to the exercise of my discretion.

44. I must consider the exercise of my discretion, taking into consideration the circumstances as a whole as they appear before me. That must, in my view, include a consideration of the fact that the defendant was acquitted under s.51A. This must surely be a factor for consideration.

45. However, my answer to the double option question is that the so-called double option is not a factor which the Court can take into account when awarding costs. The reason I say this is that the possible entry of a Nolle Prosequi is irrelevant to the question of costs.

46. Subject to what counsel may say in the future, 1 consider that there may be some merit in the Crown's argument that an acquittal under s.51A may be analogous to an acquittal on a technicality which has no merit. The Practice Direction example (c) would enable the Court to refuse to award an acquitted defendant costs where there is ample evidence to support a conviction. It seems to me that if the crown could show that there was ample evidence to support a conviction against Mr Richard Wallis, but that it had taken the course which it had in what it perceived to be in the public interest, this may well provide a good ground for refusing costs to Mr Wallis.

47. So the upshot of this ruling is that I rule that I have jurisdiction to make an award of costs in favour of a defendant acquitted under s.51A and secondly, that the so-called double option is not a factor which the Court can take into account when awarding costs, but the fact that the Crown has elected to proceed under s.51A is such a factor.

Representation:

Mr C. Grossman, S.C.C. and Miss Mary Sin, C.C. for the Crown.

Mr Mills-Owen, Q.C. and Mr M. Lunn (inst'd. by M/s. Lovell, White & Durrant for Mr Richard Wallis (D5).