Re A Firm of Solicitors of Hong Kong for Judicial Review

HCMP002977/1989

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HEADNOTE

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A warrant issued by the Deputy Commissioner of  ICAC under section 17(1) of the Prevention of Bribery Ordinance against a solicitor was declared to be invalid upon an application for judicial review on the grounds that it was in general terms and too wide.

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

MISCELLANEOUS PROCEEDINGS

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Coram: Hon. Jones J. in Chambers

Dates of hearing: 10 and 11 January 1990

Date for handing down judgment in Court: 24 January 1990

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JUDGMENT

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1. This is an application for judicial review pursuant to an order made on the 6th November 1989 by Sears J. granting leave to the applicant, a firm of solicitors. The principal relief sought is for a declaration that a warrant issued by Mr G.E. Stockwell, Deputy Commissioner of the Independent Commission Against Corruption ("ICAC") dated the 26th October 1989 is invalid.

2. I heard the application in Chambers pursuant to the applicant's summons filed on the 10th November 1989, but in view of the public importance of this matter I have decided to hand down my judgment in court.

3. The applicant, as I have said, is a firm of solicitors in Hong Kong, but the name has not been disclosed in the title to the proceedings having regard to the provisions of section 30 of the Prevention of Bribery Ordinance which provides for an offence to be committed if the identity of any person subject to an investigation under the Ordinance is disclosed without lawful authority or reasonable excuse.

4. The facts reveal that on the 27th October 1989, the senior partner of the applicant whom I shall refer to as Mr X, a barrister in private practice whom I shall refer to as Mr Y, and Mr C.W. Reid, a Deputy Crown Prosecutor of the Attorney General's Chambers in charge of the Commercial Crimes Unit, were arrested by officers of ICAC on suspected offences of corruption. They were all released on bail and to date no charges have been preferred. Mr Reid has since failed to surrender to his bail and his present whereabouts are unknown. The arrests followed a number of complaints received by ICAC during the summer of 1989 that Mr Reid may have abused his position in the Attorney General's Chambers by according favourable treatment to defendants and suspects in certain prosecutions and potential prosecutions for commercial crime that were under his supervision. Specific allegations were made that Mr X and Mr Y who had acted for some of the defendants and suspects had made substantial payments to Mr Reid in consideration of the preferred treatment that had been given and which had been made over a number of years.

5. Investigations made by the ICAC reveal that Mr Reid may have been in possession of assets or had incurred expenditure that could not be explained by his known official emoluments from the Hong Kong Government. It is alleged that the acquisition of certain assets and the expenditure incurred coincided with the receipt of corrupt payments made to Mr Reid by Mr X and Mr Y. It is not in dispute that the applicant has acted for various clients charged with commercial crime including Mr Ronald Li with which case Mr Reid was concerned on behalf of the Crown. Mr Y has been retained as counsel by the applicant in some of these cases.

6. Evidence of visit's to the applicant's office by Mr Y and Mr Reid and of a meeting between Mr X, Mr Y and Mr Reid at a restaurant in October 1989 appear from an affidavit made by Mr Kershaw, a Principal Investigator of the Operations Department of ICAC. Mr X admits that visits were made to the applicant's office by Mr Y to work upon cases on which he had been instructed by the applicant and that Mr Reid attended the office in connection with a case that involved his brother, Mr Michael Reid, for whom one of Mr X's partners in the applicant firm acted.

7. A belief that the corrupt payments involved the Ronald Li case also appears in Mr Kershaw's affidavit where he made reference to an application by Mr X for the bail of Mr Ronald Li to be reduced. It is alleged that Mr Reid failed to inform the ICAC of the position and of the intended hearing of the application so that submissions as to why the application should have been opposed were not made. Mr X in his evidence states that Mr Ronald Li's surety was about to leave for Canada which resulted in the release of the surety to which application the Crown did not object. Mr X states that he has no knowledge as to whether or not Mr Reid informed the ICAC about the intended application. Mr Kershaw said that Mr Reid subsequently informed the ICAC that he had forgotten to inform them of the application.

8. Apart from Mr X no other partner or employee of the applicant has been arrested or charged in connection with the investigations made by the ICAC. Mr X denies that he has been guilty of any offence relating to any corrupt payments made to Mr Reid.

9. After Mr X was arrested on the 27th October 1989, his home, cars and boat were searched under a separate search warrant and with his permission and certain items were seized, but no complaint is made about these searches and seizure. On the same day, in response to the present warrant issued by the Deputy Commissioner, a search was requested of the applicant's office. The warrant issued is in the following terms : -

"THE PREVENTION OF BRIBERY ORDINANCE

(Chapter 201)

WARRANT to ENTER and SEARCH by the Commissioner of the Independent Commission Against Corruption, under Section 17(1).

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WHEREAS it appears to me that there is reasonable cause to believe that in a premises or place, namely offices of ......, Solicitors and Notaries, Agents for Trade Marks and Patents, ....................... . there may be files, accounts, receipts, documents or other things which may be relevant to advantages offered to or accepted by, expenditure incurred by, or pecuniary resources or property controlled by Charles Warwick REID, which is evidence of the commission of an offence under Section 4(1), Section 4(2), Section 10(1)(a) and Section 10(1)(b) of the Prevention of Bribery Ordinance, Chapter 201, Laws of Hong Kong, those documents named being documents used in the commission of a criminal offence and therefore not being subject of Legal Professional Privilege.

NOW THEREFORE, in exercise of the powers vested in me by section 17(1) of the Prevention of bribery Ordinance, Cap. 201, I hereby empower -

Mr Christopher John KERSHAW

Mr YU Chun-cheong

Mr YIP Kar-kwai

Miss LEUNG Lai-on

investigating officers of the Independent Commission Against Corruption, to whom this Warrant is directed, to enter such premises or place, by force if necessary, arid search the same.

10. DATED this 26th day of October, 1989.

11. Both Mr X and later, counsel Mr Adams on his behalf, expressed the view that the warrant was invalid on the grounds that it was too wide and general. There was also an objection on the grounds of legal professional privilege. Specific reference was made by Mr Kershaw during the search that Mr X was acting for Mr Ronald Li. Eventually during the course of discussion, Mr Kershaw restricted his requirements to a list of all clients of the applicant's firm relating to commercial fraud and ICAC cases and to records of payments in and out. In the belief that force might be used if they did not comply the applicant handed over a list of clients with ledger cards and computer print-outs.

12. A letter was subsequently written by the applicant to the ICAC on the 2nd November 1989 reiterating that the warrant was invalid, the search and seizure unlawful, and that the documents had been handed over under protest. No further action has been taken by the ICAC since that letter.

13. The law in respect of a general warrant is clear, for it was held in Entick v. Carrington (1765) 19 State Tr 1029, that a general warrant authorising a search for seditious papers was illegal.

14. In a recent case In re Ip and Willis MP1472/1989, 8th August 1989, Sears J. considered' the validity of a search warrant granted by a magistrate at the request of the ICAC to search the offices of a firm of solicitors in Hong Kong under section 10B of the Independent Commission Against Corruption Ordinance which provides :-

"10B. Without prejudice to section 16 or section 17(l) of the Prevention of Bribery Ordinance, if a magistrate is satisfied by information on oath that there is reason to believe that there is in any premises or place anything which is or contains evidence of the commission of any of the offences referred to in section 10, he may by warrant directed to any officer authorise such officer, and any other officers assisting him, to enter and search such premises or place."

At page 7 of his judgment, Sears J. had this to say :-

"It is the right of every citizen only to allow those persons to enter his home or workplace whom he permits. This right to privacy is enshrined in our system of Common Law and is found in nearly all Commonwealth Jurisdictions (England has a separate statutory code). That right can only be taken away when a sworn information is placed before a magistrate who decides on that material whether such a warrant is justified. This is a judicial act, not a 'rubberstamp' procedure. The magistrate is an important safeguard for the prevention of abuse, for example, from the unwarranted interference by a government department into a citizen's private life, or the harassment of persons by a police department."

15. In one of the authorities cited by Sears J. Rosenberg v. Jaine [1983] NZLR 1 Davison C.J. at p.5 referred to three principles to be derived from an earlier decision of the Court of Appeal in New Zealand where he had this to say :

"The law as to the validity of a search warrant is fully discussed by our Court of Appeal in Auckland Medical Aid Trust v. Taylor [1975] 1 NZLR 728. Three principles emerge from that decision. They are :

1. The warrant should describe the alleged offence in respect of which the search is authorised so as not to mislead the reader as to the nature of the alleged offence, See McCarthy P at pp 735-736.

2. The warrant may authorise the search and seizure only of such things in respect of which the District Court Judge is satisfied that reasonable grounds for belief exist that they are evidence of the commission of an offence. See Richmond J at p 740 and McMullin J at p 746.

3. The warrant must be in sufficiently specific terms in regard to what is authorised to be searched for and seized so as to enable the occupier of the premises to understand and, if necessary, obtain legal. advice about the permissible limits of the search.  See McCarthy P at p 733, Richmond J at p 742, and McMullin J at p 749."

16. The right to search the applicant's premises in this case is not based upon the common law, but under section 17(1) of the Prevention of Bribery Ordinance which where relevant reads :-

" 17.(1) If it appears to the Commissioner that there is reasonable cause to believe that in any premises or place, ........,  there may be anything which is or contains evidence of the commission of an offence under this Ordinance, he may by warrant directed to an investigating officer empower such officer to enter such premises or place, by force if necessary, and search the same ........"

17. The only information that has been supplied to Mr X by ICAC is that he is suspected of having made corrupt payments to Mr Reid. In his affidavit Mr Kershaw places reliance upon section 30A of the Prevention of Bribery ordinance to justify the non disclosure of the names of its informants or further details of the complaints for it would tend to lead to the discovery of the identity of the informants. Section 30A where relevant reads as follows :-

" 30A. (1) Save as provided in. subsection (2) -

(a) no information for an offence under this ordinance shall be admitted in evidence in any civil or criminal proceeding; and

(b) no witness in any civil or criminal proceeding shall be obliged-

(i) to disclose the name or address of any informer who has given information to the Commissioner with respect to an offence under this Ordinance or of any person who has assisted the Commissioner in any way with respect to such an offence; or

(ii) to answer any question if the answer thereto would lead, or would tend to lead, to discovery of the name or address of such informer or person,

if, in either case, such informer or person is not himself a witness in such proceeding,……………………………………………”

Mr Sarony, counsel for the ICAC, submitted that section 30A related to the investigative process so that there is no obligation upon the ICAC to disclose the information requested. On the other hand, Mr Ching, for the applicant, submitted that before a warrant could be executed prima facie evidence of a crime had to be established while section 30A only relates to proceedings at trial and not to the investigative process. In my judgment, this section clearly relates to proceedings at the trial and has no relevance to the investigative process. In any event, Mr X is not seeking the names of the informants but specific details of the offence that it is alleged that has been committed.

18. Mr Sarony conceded that in the normal course of events, the warrant issued by the Deputy Commissioner is too wide, but that having regard to the gravity of the allegations that have been made which affect the very fabric of the legal system, it was very difficult to frame it in other terms without disclosing the sources of information. Accordingly in issuing the warrant, the Deputy Commissioner should be in a position to exercise his own judgment upon the evidence in his possession with the court having an overriding jurisdiction to set aside the warrant if it is too wide or oppressive. If the warrant cannot be issued in its present terms, it would result in tying the hands of the ICAC with the result that it would be inhibited from carrying out its statutory duties. Further, as Mr X is a solicitor and is aware of the evidence of the commission of an offence by Mr Reid under section 4 of the Prevention of Bribery Ordinance which relates to the offer of or acceptance of an advantage and section 10 of the same ordinance which relates to the possession of unexplained property, he should be aware of his position. However, I cannot accept that a solicitor is in any different position to that of the ordinary citizen.

19. Although Mr Sarony attempted to justify the warrant by. its reference to the two sections of the Prevention of Bribery Ordinance it is not in specific terms for particulars are not given of any offence nor do the documents referred to in the warrant refer specifically to any particular case, time, place or how much money was paid or the manner in which the corrupt payments are alleged to have been made or the reason for such payments. Further Mr Kershaw in his Affidavit states that "the warrant was sought to enable the ICAC to search the applicant's offices lest there may have been any evidence directly or indirectly relative to such payments". Significantly Mr Kershaw does not swear to any belief that Mr X has committed, or been implicated in the commission of any offence. Indeed, no such evidence has been adduced before me upon which the Deputy Commissioner could have had reasonable cause for belief of the commission of an offence for the purpose of issuing the warrant. Accordingly, it would appear that the ICAC did not have any direct. evidence of such payments and were unable to provide any further particulars to support the issue of the warrant.

20. Although as I have said, Mr Sarony contended that the warrant should be upheld on the ground of the gravity of the offences alleged, nevertheless no authority was cited to support this submission. In effect, he asserts that the ICAC is in a different position to other law enforcement bodies in not being required to conform to the principles in respect of search warrants laid down in authorities of long standing going back over two hundred years. Whilst the ICAC has been given wide and in some respects draconian powers, it is not above the law. Indeed, it is surprising that the legislature should have given power to the Commissioner under section 17 to issue a warrant which has criminal sanctions if disobeyed without the important safeguard for the application to be considered by a magistrate in the first instance and further without the Commissioner being required to place his grounds for reasonable cause for belief on oath. As the Commissioner does not have to satisfy a magistrate as he is required to do under section 10B of the Independent Commission Against Corruption Ordinance the only effective challenge that can be made to the exercise of the powers conferred under section 17(1) of the Prevention of Bribery Ordinance is by way of judicial review after steps have been taken to execute the warrant.

21. The power to execute a search warrant must be strictly controlled, see Descoteaux v. Mierzwinski [1982] 70 CCC 385, whilst as was stated by Sears J. in his judgment to which I have referred, MP1472 of 1989, care must be taken in the framing of a search warrant to enter a solicitor's office. However, despite those observations they have not been heeded in the present case.

22. Although a general indication was given by the ICAC that Mr X is being investigated in respect of the Ronald Li case, no reference in fact is made to that case in the warrant and the subsequent restriction by Mr Kershaw upon the effect of the warrant to certain matters does not save it from being invalid. The warrant is in general terms that are far too wide with the result that I hold it to be invalid.

23. The argument directed to the question of legal professional privilege does not therefore arise as the requirements of the ICAC under the warrant have not been identified.

24. In the result the applicant is entitled to the declaration sought that the warrant is invalid. I shall hear the parties on the other reliefs claimed and costs.

Representation:

Mr Charles Ching, Q.C. and Mr Patrick Fung (Victor Ng & Co.) for the Applicant.

Mr Neville Sarony (Herbert Smith) for the Respondent.