HKSAR v. Cheung Ting Bong
Read the full judgment text of CACC 89/2003 on BabelCite. This Court of Appeal judgment was delivered on 7 July 2004.
1. On 28 February 2003, the applicant was convicted by Deputy Judge Woodcock in the District Court of conspiracy to offer an advantage to a public servant, contrary to section 4(1)(c) of the Prevention of Bribery Ordinance, Cap 201, and was sentenced to a term of four years' imprisonment. This is his application for leave to appeal against conviction.
Cites 2 cases
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CACC000089/2003 CACC 89/2003 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF APPEAL CRIMINAL APPEAL NO. 89 OF 2003 (ON APPEAL FROM DCCC 929 OF 2002) ---------------------
---------------------- Coram: Hon Stuart-Moore V-P, Stock JA and Yeung JA in Court Date of Hearing: 30 - 31 March 2004 Date of Judgment: 7 July 2004 ----------------------- J U D G M E N T ----------------------- Hon Stock JA (giving the judgment of the Court): Introduction 1.On 28 February 2003, the applicant was convicted by Deputy Judge Woodcock in the District Court of conspiracy to offer an advantage to a public servant, contrary to section 4(1)(c) of the Prevention of Bribery Ordinance, Cap 201, and was sentenced to a term of four years' imprisonment. This is his application for leave to appeal against conviction. 2.The public servant to whom the bribe was said to have been paid was Chan Kau-tai (Chan) a Chief Building Services Engineeer with the Building Services Section of the Housing Department. Putting the matter very broadly, the allegation was that the applicant, a director and general manager of a company called Tridant Engineering Company Limited (Tridant) managed to secure a contract for the supply of electrical equipment for a project at Upper Wong Tai Sin, although Tridant's tender for the supply of the electrical equipment was not the lowest, and that he conspired with lowest bidder, a Mr S S Lai (Lai) the proprietor of Yew Sang Hong Limited (YSH), who wanted to withdraw from the process, to pay Chan the sum of $1.5 million and that that sum was paid to Chan. The charge 3.The particulars of the offence read as follows:
The prosecution case (1) Withdrawing the tender 4.Tridant, YSH and a company called Hing Yip Electrical Engineering Ltd (Hing Yip), run by Lai but the proprietor of which was YS Lai, Lai's brother, were all subcontractors on a list approved by the Housing Department. At the material time, Chan was in charge of that Department's Building Services (New Works) section 1. 5.In January 1998, YSH submitted a tender for electrical installation works for a building project at Upper Wong Tai Sin Estate but before long Lai came to learn that the bid made by YSH was the lowest, lower than any others by some $8 million. But not only that, he came to realise that his company had made an error by which it had grossly underestimated costs and would suffer a substantial loss were its tender to be accepted. 6.The evidence was that Lai was concerned about the consequences of a withdrawal of his company's tender, thinking that it might prejudice the company in future bidding, not least because he had previously withdrawn a Housing Authority tender. According to the testimony, he received a telephone call from Chan who asked if an error had been made. Then the two met in late February 1998. Lai said to Chan that he was worried and wanted to withdraw but was concerned whether his licence would be revoked by the Housing Authority; in other words, whether his company would be removed from the list of contractors approved by that Authority, and Chan told him that anyone who withdrew a tender twice within two years would indeed be removed. 7.At the same meeting, Chan asked Lai whether he knew the applicant, Cheung of Tridant; but Lai did not know him. According to this testimony, Chan said that he had contacted the applicant and told him that the contract would be awarded to Tridant and then said that Lai was to approach the applicant "to ask them to play along ... they would know what to do". Lai's evidence was that by that he understood that Chan was asking the applicant "to give him a reward for Tridant to be able to obtain this project". Then YSH's tender was withdrawn and this was followed by a letter from the Housing Authority warning YSH against a repeat of conduct by which a tender was withdrawn. (2) The coffee shop meeting 8.In March, it was said, Chan asked Lai to contact the applicant. Chan gave the applicant's telephone number to Lai and Lai telephoned the applicant who suggested a meeting at a coffee shop in the New World Hotel. This was the only occasion upon which they met. They met there on 30 March 1998 and it was agreed that Chan would be paid a sum of $2 million as a bribe. The method by which the sum was to be secured was somewhat circular but explicable on the basis of a need to avoid suspicion. Tridant itself could not raise the extra sums directly from its accounts without attracting suspicion, and the idea was struck whereby Tridant would purchase generator sets from Hing Yip, and Hing Yip would in turn acquire them from a company called Brongham Park Ltd (Brongham Park) in which YSH held a majority of shares. Hing Yip, YSH and Brongham Park all occupied premises on different floors of the same building in Tai Kok Tsui. This equipment would be invoiced by Hing Yip at a price increased, in comparison with Brongham's price, by the sum of the bribe. Lai would then pass the bribe to Chan. The testimony was that the applicant agreed to this proposal, and that as between Lai and Chan, it was agreed that Chan would retain $1.5 million and that $500,000 would be retained by Lai for payment of taxes on the machines and also in case the purchasing department of Tridant asked for a reduction in the price after it had been agreed. 9.Given the thrust of one of the grounds of appeal, it is worth recounting Lai's testimony as to what transpired at the March meeting in the coffee shop:
(3) Creating the extra $2 million 10.Hing Yip quoted a price of $8,337,760 to Tridant for the generator sets but that sum was lowered when it was appreciated that other contractors quoted prices that were much less, and a Mr Chan from Tridant informed Lai that a much lower quote was required, a quote of $7.226 million, if Hing Yip was to secure the contract. That is what happened. Hing Yip then ordered generators from Brongham who sold the generators, the trade name of which was Vibropower, to Hing Yip for $5.872 million. Tridant's order from Hing Yip is dated 1 September 1998 and the order by Hing Yip from Brongham Park August 1998, although the evidence before us suggests that Tridant's acceptance of the quote came earlier than September. Hing Yip sold the sets to Tridant for $7.226 million, a mark-up of $1.394 million. To make up the remaining sum then required for the $2 million bribe, there was a further similar arrangement for the purchase of generators from Brongham Park via Hing Yip for another project (the Sau Mau Ping project) at a mark-up of $650,000. Hing Yip placed this order with Brongham in November 1998, Tridant having accepted Hing Yip's quote in October 1998. 11.In this way, Hing Yip received more than $2 million in excess of the sum paid to Brongham for the machines, and Lai then paid the sum of $1.5 million to Chan between April 1999, when Chan started to chase for his money, and August 2000. Lai's testimony was that he paid Chan in twelve instalments, each time in cash. Indeed he started to pay Chan even before the generator sets were delivered to Tridant and before Tridant had paid for them, because Chan was chasing. 12.To cover for the payments made by YSH, Lai created false invoices from a bogus Macau company. He made no record of the payments to Chan. So, for example, Lai gave evidence that the first payment was made in cash in a vehicle in Happy Valley and this was for the sum of $350,000 and that this was covered by two cheques drawn by YSH totalling $354,950 in favour of a fictional company called Tai Pang whose bogus invoices for electrical equipment he, Lai, caused to be issued. The invoices and vouchers were produced in evidence. Then there was produced a bank statement showing the withdrawal of cash from YSH's account in the relevant sums. Lai gave evidence of spasmodic payments, each time in round figures, usually paid in the course of a motor car journey near Chan's office or on the way to a luncheon. Sometimes the cash came from Lai's personal bank accounts but he could reimburse himself from payments to the bogus company Tai Pang. In support of his testimony about these payments, he produced the bogus invoices from Tai Pang and payment vouchers, as well as bank statements showing the withdrawals which he said went as cash payments to Chan, and he also produced credit card slips to show the lunches for which he had paid which preceded or followed some of the payment incidents. Sometimes the figures thus withdrawn did not quite tally with the suggested cash payments, he, Lai, keeping some cash for himself from the withdrawals. So too the sums paid on each occasion to Chan differed, ranging from $50,000 to $350,000. 13.The evidence was also that in the normal course of its business Hing Yip did not supply or sell generators and had never before purchased generator sets from Brongham Park. Brongham Park's practice hitherto had always been to sell directly to the contractors as sole agent and distributor so that what happened in this instance was, to that extent, unique. Since, according to the evidence, Lai was to pay the bribes to Chan there had to be a mechanism by which the sums paid by Tridant to Hing Yip which made up the bribe sum was to be channelled to the applicant. This, said Lai in his testimony, was effected by sales from YSH to Hing Yip of electrical switchboards at inflated prices. The applicant's case 14.The applicant did not give evidence himself but he called as a witness an expert, a Mr Battersby, the effect of whose testimony was that the prices paid for the generators were reasonable. The argument was that if indeed the evidence that the prices had been inflated was not correct or was suspect, then the fabric of the prosecution case fell apart. It was contended as well on behalf of the applicant that there was no apparent benefit to the applicant or to his company in paying the bribe and, further yet, that the testimony of Lai was unreliable especially as to the detail of his payments to Chan. Reasons for Verdict 15.The applicant was a person of previous good character and the judge reminded herself of the significance of that fact. She noted too that Lai was an accomplice witness and that, accordingly, his testimony was to be treated with caution. 16.The judge noted that although the case rested upon the reliability of the evidence of Lai, there were pointers, his oral assertions aside, which lent strength to his testimony. In particular, it was established that the course adopted in this case, namely, the order of generators from Hing Yip rather than from Brongham Park directly was unusual and she noted too that in relation to other projects Tridant had obtained quotes for Vibropower generators directly from Brongham Park. Furthermore the original tender by Tridant had not included Vibropower generators, a factor in support of the evidence of Lai that the idea came after the tenders were submitted. So too there was documentary evidence in support of Lai's accounts, namely, the false invoices and bank statements to show withdrawals of the instalments which Lai said he had paid. 17.She noted the submissions made by defence counsel, in particular the suggestion that Lai was unreliable and that the bank statements which were said to support his evidence of bribes on the applicant's behalf to Chan disclosed other large withdrawals, with the contention that there was no basis upon which to distinguish between withdrawals for supposed bribes to Chan and for other purposes. 18.The judge found the records to be compelling evidence in support of Lai's story. He had not only relied on his personal bank accounts but also on the accounts of YSH from which moneys were taken to pay the bribes, and on the corresponding false invoices which he had produced. So, for example, there was exhibit P16 which related to a payment, the first payment, of $350,000 on 1 April 1999 and a supporting false invoice from the Macau company which corresponded with that amount and that payment. 19.Reliance had been placed by defence counsel upon the testimony of the expert to the effect that the transaction between Hing Yip and Tridant appeared above board and in accordance with trade practice and that Hing Yip's tender had in fact been the lowest. The judge noted however that the appearance of normality was precisely what was necessary in order to detract suspicion, and that although in the event the tender was the lowest, the original tender of $8.537 million was substantially higher than the others and that the lowering of the tender came only after a call from Mr Chan of Tridant in which he suggested a reduction to the sum of $7.266 million in order to secure the contract. The suggestion made by the expert that there was no evidence of an inflation of the price was, in the event, said the judge, neither here nor there because Lai's evidence in court was not that the invoice had been inflated but that matters had been so organised that there would be a profit from the difference between Brongham Park's price and Hing Yip's price and that the profit would be utilised to pay the bribe. 20.As to why Lai asked the applicant to pay Chan a sum of $2 million, the judge said that Lai's explanation was not entirely satisfactory but that nonetheless his evidence had the ring of truth and was supported by the indicia to which we have referred. She found that money was paid to a senior Housing Department officer whose function was directly connected with the type of business conducted by YSH and by Tridant and that there must have been envisaged some benefit to the applicant or his company. She was sure that the applicant was party to the conspiracy charged and, accordingly, she convicted him. The Immunity 21.Lai was arrested on 4 August 2001 and released on bail the following day. On 11 August, his lawyers offered on his behalf that he should make a non-prejudicial statement, in other words a statement made on condition that it not be used against him. This offer was accepted. That statement was provided on 29 August 2001, and between September 2001 and March 2002 they supplied to the ICAC documents in Lai's possession relevant to the case. Three further statements were provided by Lai: on 19 November 2001, and on 6 September 2002; and on 15 January 2003, shortly before the commencement of the trial of the applicant in the District Court. 22.On 22 January 2003, Lai was provided with an immunity from prosecution which was in the following terms and signed by a Senior Assistant Director of Public Prosecutions on behalf of the Secretary for Justice:
23.On 29 January 2003 Lai made a further statement to the ICAC, and on 12 February 2003 he commenced his testimony at trial. 24.Cross-examination by leading counsel for the applicant, Mr Cheng Huan SC, commenced with an exploration of the immunity which the witness had been granted. Lai said that when interviewed by the ICAC he had been asked questions about a suggested bribe to Samuel Wong, the manager of Brongham Park, a sum of $200,000, and about a sum of $60,000 to Chan of the Housing Department for a project at Lai Chi Kok. Then questioning turned to a sum of $230,000 about which he had been questioned by the ICAC. The witness said that he had met Chan first in 1991 and then again in 1994, and he was asked whether he had met Chan between 1994 and February 1998 and the witness said it was only "chatting". But counsel pressed the matter:
25.Then Mr Cheng wanted to pursue the question whether there had been corrupt dealings between the two during the period of the charge (1998 to 2001) other than in respect of the Sau Mau Ping and Wong Tai Sin projects. Mr Cheng explained why this was important. He said that:
Then this exchange:
26.Counsel for the prosecution then asked to be permitted to consider the matter overnight and forecast that a further immunity might be the answer. And that is what happened. The following morning, 13 February 2003, a further immunity was presented to the witness and the court suggested that the witness might want to seek further legal advice about it. Mr Cheng said:
And later:
although Mr Cheng expressed some concern about the prospect of that taking place whilst in the middle of his testimony. In the event, Lai said that he wanted to discuss the immunity with his lawyers and the court told him that he could do so but that he was not to discuss his testimony with anyone. 27.The witness saw his lawyers for about an hour that morning at court and then resumed his testimony. 28.The immunity, dated 13 February 2003, and issued by a Deputy Director of Public Prosecutions was in the following terms:
The balance of the immunity document is in the same terms as in the first. 29.It will be seen that the difference between the two immunities is that in addition to evidence in connection with the offences charged in the District Court case or offences connected therewith, the second immunity covers as well testimony given in the proceedings against Chan in the High Court and any offences connected therewith. 30.So it follows that what was not covered by these immunities was evidence of any criminal activity by the witness other than that charged in the three sets of proceedings particularized in the immunities and criminal conduct connected with that criminal activity. Mr McNamara, for the prosecution, described it as an immunity "which in fact covers the whole of the corruption." (Appeal bundle p 108). 31.Cross-examination then continued and the witness confirmed that there had been no corrupt dealing with Chan before February 1998. However, he said, after February 1998 there were four occasions other than those involving the applicant but involving Chan in which there had been corrupt dealings and that these involved a sum of $400,000. Then this:
32.Much of the cross-examination of Lai was directed at showing that he could not, without the benefit of a contemporaneous record, recollect, as he suggested, the payments he had made and that the payments had been made for the purposes he suggested. The witness accepted in cross-examination that he had used the bank accounts - his personal bank accounts with Standard Chartered and with Dao Heng Bank - to pay bribes to Chan in addition to those covered by this charge; and that he had used bogus invoices for bribes in addition to those covered by the 1.5 million paid to Chan; and the witness further identified sums other than those he said he paid to Chan as a result of the agreement with the applicant which were also for bribes and paid at about the same time as the instalments he had identified. He said in re-examination that those bank accounts were used for the passage of mortgage payments, ATM card withdrawals, and payments made to him by the company, YSH. 33.When Mr Cheng asked the witness:
34.We see a little later that Mr Cheng put to the witness that he had told the ICAC that he had been involved in a price cartel in 1999 in relation to miniature circuit breakers and the witness said:
Mr Cheng informed the court that according to a statement made by Lai to the ICAC, Lai had been involved in an MCB cartel bribery escapade with Chan and that in respect of that affair, the witness had paid Chan $180,000 "which is the same period as the third payment". This appeal (1) Immunities 35.Much of this appeal turns upon the question of the immunities. It is said that:
Some of these grounds overlap. (a) The policy argument 36.The first limb of the argument presented to us was in the nature of a broad ranging attack upon the frequency with which immunities are granted in Hong Kong for the purposes of prosecutions in the courts. The argument took us to well-trodden sentiments which treat the practice with distaste, going back at least as far as Hale CJ in the 17th Century when he said, at page 226, Vol II "The History of the Pleas of the Crown" that:
sentiments of a tenor to which we referred in HKSAR v Leung Kai-chung [2002] 1 HKLRD 771, 787. 37.Counsel points as well to several more recent judicial expressions of distaste, for example to R v Turner and others (1975) 61 Cr App R 67, a case in which the English Court of Appeal suggested that immunities should be given most sparingly, a case in which, we note, the form of immunity was one which expected the accomplice to give testimony in accordance with a statement he had given to police, rather than in accordance with the truth, which may or may not in a particular case be the same thing; and a case where the circumstances of the immunity and the rewards to be conferred on the accomplice were unusual and the facts complex. 38.These concerns are said to have resulted in the adoption in the United Kingdom of an approach that is reflected in a document entitled "Legal Guidance on Witness Immunities and Undertakings" issued by the Crown Prosecution Service, where the general principle is stated that:
A witness undertaking is a written agreement to refrain from using statements, or documents or other information provided by a person against that person in criminal proceedings, so that that person may nonetheless be prosecuted if evidence other than that referred to in the undertaking becomes available. 39.In New South Wales, the policy of the Director of Public Prosecutions is stated as one that grants immunities only as a last resort. 40.By contrast, the policy document issued by the Director of Public Prosecutions in Hong Kong does not speak of the immunity in such limited terms. Even though it requires the prosecutor to be ever cognizant of his special responsibility to ensure that "the processes of justice do not miscarry when an informer is used". It is said in this policy statement that an accomplice will only be given an immunity in certain circumstances, which are then listed, one of which is where the evidence is not available from an alternative source and where the accomplice can reasonably be regarded as significantly less culpable than the accused, a directive which is said by the applicant to have been breached in this case. 41.It is argued further that the usual course, or the usual desirable course, when accomplice testimony is to be used is to require the accomplice to plead guilty and to testify thereafter, leaving it to the sentencing judge to reward the accomplice according to the assistance which it is decided he has properly rendered. That is said to be a process which, unlike the immunity process, is transparent. (b) Analysis 42.Where then does all this lead? It leads, so it seems, to the contention that the immunity ought never to have been granted in this particular case. 43.In so far as the submission is directed at the court, rather than at the law enforcement authority in some argument as to policy, it is a submission for which it is difficult to find a peg. We accept that "there may, in exceptional circumstances, be a right to review the exercise of" the powers of the Secretary for Justice and of the Director: see R v Tsui Lai-ying and others [1987] HKLR 857, 874; and we accept too that a judge always has a discretion to exclude evidence the admission of which will adversely affect the fairness of the trial. Yet statements of the dangers of accomplice evidence given under immunity and reference to the rarity of such devices elsewhere, and to suggested departures from local guidelines, are of little use in the context of a particular case, for in a particular case when one comes to the question of a judge's discretion to exclude evidence, the issue will invariably be that of the fairness of the trial in that case. Any suggestion that the grant of an immunity of itself inevitably runs contrary to the imperative of a fair trial is not, it seems to us, logical. The complaint that immunities are granted too frequently in this jurisdiction may or may not be true; but even if true cannot affect the case-specific issue that a trial court, and an appellate court, must in each instance ask, which is whether the instant trial has been rendered unfair by the use of the testimony of an accomplice who has been granted an immunity. 44.Just as it is recognized that the grant of an immunity to an accomplice is of itself a distasteful exercise and that it carries dangers too well recognized to require repetition in this judgment, so there is another side to that coin, to which we referred in Leung Kai-chung at page 788, which is the need to bring criminals to justice where the use of an immunity is openly engaged and where it provides a key, perhaps the only, source of doing so; and in so far as emphasis has been placed in argument upon the highly critical comments made in Turner, it is worth noting the more recent comments of the Privy Council in Chan Wai-keung v R [1995] 2 Cr App R 194, 200:
45.It is not for the courts to direct prosecution policy, either generally or in a particular case, although a change in policy may result from a decision that the application of a policy has been incompatible with a fair trial in a particular case. Nor do the courts exercise a disciplinary function. Their function is to ensure the proper application of such procedures as the law, with the benefit of long experience, has designed to ensure a fair trial and to devise, where necessary, such mechanisms as are available and lawful to meet whatever problems in a specific case arise so as to ensure that they do not stand in the way of a fair trial. 46.There is nothing, as a generalization, unlawful about the use of accomplice evidence given under an immunity. If relevant, such evidence is admissible. Whether, as a matter of discretion, there stands in the way of its admission some consideration or another is always a matter for the case and the context. So, for example, it was said in Tsui Lai-ying at page 874:
47.That the function is case-specific and that the question in this case is whether the use of the immunity precluded a fair trial, and whether this Court should by reason of the matters here advanced say that the judge was wrong to admit the testimony of Lai, is emphasized by the following passages from HKSAR v Lee Ming-tee [2001] 1 HKLRD 599, 614-615:
48.And in Secretary for Justice v Lam Tat-ming and another (2000) 3 HKCFAR 168, 178-179, the Chief Justice pointed out that:
49.So we turn to the question whether there was some feature of the use of the testimony of Lai by reason of which the judge ought, in order to ensure a fair trial for the applicant, have excluded the evidence of that accomplice. 50.Putting aside for the moment the Bill of Rights point, as well as the issue raised in the fourth and fifth points under this head (namely the suggested inhibition of cross-examination, and the question of the accomplice's consultation with his legal advisers), no ground of substance for exclusion of this testimony has been made out. There is no suggestion in this case, nor was there any suggestion at trial, that the grant of the immunity or immunities to Lai was tainted by improper conduct on the part of the investigating or prosecuting authorities, or that any material fact relating to that grant was hidden from those acting for the applicant. There was no request made for further particulars of the circumstances attending that grant; and the applicant was cross-examined about those circumstances. A summary of a briefing record taken when first the approach was made by those acting for the applicant to the police was disclosed to the defence team. There was no application made that the proceedings should for some reasons be stayed. There was not even an application made before or at the time that the testimony was to be adduced, that it should be excluded. We were informed in the course of this hearing by Mr Macrae SC that, during closing submissions, leading counsel at trial invited the judge to exclude the evidence, by which we assume that she was asked to ignore it, although we have no transcript of those submissions. 51.What the judge said about this was as follows:
and the judge then addressed in detail the evidence that bolstered the story given by Lai, evidence to which we shall turn when we assess the further grounds of this appeal. 52.We see nothing unconscionable in the use of Lai as a witness against the applicant. In this regard, it was argued that the Director's stated policy that immunities should not as a rule be granted to those who are more culpable than the accused against whom the accomplice evidence is to be used was breached in this case, since it is self-evident that Lai was more culpable, his corruption on a wider scale, than was the applicant. But that is to view but one compartment of the whole. Lai was the accomplice used to expose, as a witness, the corruption of the entire scheme at the centre of which was Chan, a civil servant occupying a post ripe for those who would be corrupt. It was clearly in the public interest that he be brought to justice. By its very nature corruption is difficult to uncover and prove without evidence from accomplices and where an accomplice is used against the central figure, and a civil servant to boot, the fact that the accomplice is then used in separate trials against satellites, as it were, is perfectly sensible. 53.In the circumstances, we see no proper basis upon which we could properly disturb the exercise of the judge's discretion. (2) The Bill of Rights point 54.Article 10 of the Bill of Rights Ordinance, Cap. 383 provides, in so far as may be relevant to the issue taken in this appeal, as follows:
55.Article 11(2)(e), which is said to be engaged in this appeal, stipulates that:
The contention is that the use of an "immunised" witness unlawfully disturbs the equality guaranteed by these articles in that it causes an inequality of arms, since the prosecution can induce a witness to give evidence under an immunity, an option not realistically available to the defence. 56.The point taken is in our judgment artificial in two senses. It is artificial in that it does not for practical purposes arise in this case; and it is artificial in the sense that it places an artificial gloss on the Articles and their intent. 57.Article 10 and article 11(2)(e) are each but an aspect of the right to a fair trial. The equality of which article 10 speaks, and "the same conditions" to which article 11(2)(e) refers, are not inconsistent with such differentiations as necessarily and reasonably arise in natural consequence of the intrinsically different functions of the parties and for which there is a legitimate purpose. The articles are to be read in the context of the criminal trial processes for which they are designed. That is a context which must recognise that the roles performed by, and the burdens upon, each party to criminal proceedings are different. The articles must be taken to recognise differences inherent to those roles of each party and there is nothing, so far as we are aware, in the decisions of the Human Rights Committee of the United Nations or in the judgments of international courts, that suggest that of themselves the use of immunities as a vehicle for enabling accomplice evidence to be given is inimical to a fair trial or otherwise in breach of the rights that secure due process of law for those accused of crime; for it is no doubt recognised that such a tool is intrinsic to the role of law enforcement. Whether the right to proper and fair process is or is not undermined will depend in such cases on the circumstances of the immunity, whether all material facts have been disclosed and whether, in the round, its use has deprived the accused of a fair trial. So much is evident from the decision of the Human Rights Commission to which counsel for the applicants has drawn our attention in this case, X v United Kingdom (1976) 7 DR 115, a decision not of the European Court but of the Commission, a decision that arose out of the immunities granted to accomplices in the robberies which are the subject matter of the Turner case. The Commission pointed out that:
58.Article 11(2)(e) is a reproduction of article 14(3)(e) of the International Covenant on Civil and Political Rights, (to which Covenant constitutional domestic effect is given by article 39 of the Basic Law), and is an article intended for implementation by a host of countries each with its own legal system and is an article "designed to guarantee to the accused the same legal powers of compelling the attendance of witnesses and of examining or cross-examining any witnesses as are available to the prosecution". (See General Comment of the Human Rights Committee 13/21, referred to in 'The Human Rights Committee' McGoldrick, 409.) There was and is no suggestion in this case that the applicant was deprived of any power to call whatever testimony he wished, or that there was placed in his way any impediment to the realization of such a wish. In our judgment the issue did not arise in this case. 59.We therefore adjudge that the Bill of Rights point is not well taken. (3) The Immunity and Cross-examination 60.At [21] to [34] above, we have set out the history of the immunities granted to Lai, the circumstances in which a further immunity was granted in the course of Lai's testimony, and then the circumstances in which the witness came to refuse to answer certain questions in cross-examination on the grounds that the subject matter of those questions was not covered by the immunities granted thus far. It is in this context that it is contended that there was a material irregularity in the conduct of the trial in that, whilst Lai was afforded an immunity, he was nonetheless permitted not to answer questions which he, the witness, considered fell outside the terms of the immunity, and that thereby the defence was unfairly prejudiced in the conduct of its case. 61.The decision of this Court in Leung Kai-chung is prayed in aid, a case, it so happens, in which leading counsel for the accused was the same counsel as appeared for this applicant at the trial that is the subject of this appeal. There are two material differences between that case and this, namely, that in Leung Kai-chung the witness was prompted to refuse to answer questions in respect of precisely the conduct that was the subject of the immunity; and, second, the form of the immunity was one that encouraged him to give evidence in accordance with the contents of a statement, rather than in accordance with the truth, which as we say earlier, may or may not have been the same thing. Neither flaw tainted the proceedings with which we are presently concerned. 62.The more arguable point, however, that we have to address, is that the immunities granted were not so wide as to cover the entire area of cross-examination which Mr Cheng Huan apparently wished to explore; and he said that this placed him at a disadvantage. Mr Macrae who addressed us on this particular aspect of the appeal, was hard put to identify the prejudice occasioned to the defence, save to say that one could not predict how matters may have turned out had Mr Cheng been able to pursue the issue of payments to persons other than Chan during the period in question. 63.It is noteworthy that when the witness refused to answer questions about corrupt payments to persons other than Chan, counsel for the applicant at trial made no application for a stay of proceedings. Nor did he make any suggestion (as well he might, given the events of the previous day), that a further immunity be granted to cover the matters that he wished to canvass. Nor is there any hint that he sought an adjournment to discuss such a course with counsel for the prosecution. There is no suggestion before us that in his closing submissions counsel for the applicant pressed any suggested material disadvantage in the presentation of the defence case as a result of these refusals to answer questions. We do not have the benefit of the transcript of counsel's closing submissions, but we note that in the judge's comprehensive Reasons for Verdict, she does not touch upon this issue now raised. Mr Zervos SC puts to this Court as a proposition that in the context of the trial as a whole and the facts which emerged, there was in truth no material disadvantage and we are, in the event, disposed to agree. 64.Lai listed twelve corrupt payments to Chan in the course of 1999 which, he said, flowed directly from the agreement with the applicant to pay Chan a bribe. In the course of cross-examination, Lai said that before 1998 there were no corrupt dealings between Chan and himself. He was then asked whether there were corrupt dealings with Chan up to 2001 apart from the Wong Tai Sin and Sau Mau Ping projects, and Mr Cheng Huan told the court that the material in his possession showed at least seven other payments made to Chan during that period and that it was these payments that he wished to explore. After the grant of the further immunity on 13 February 2003, questions were indeed put about further payments to Chan and the answer was that the further payments numbered four. Let us see, then, how the issue of those four payments was in fact pursued:
65.There was no further pursuit of this issue as far as payments to Chan were concerned, and no attempt whatsoever to show that the witness must have confused the twelve payments which he said related to the applicant with these other corrupt payments to Chan for other purposes. 66.It was an accepted fact in the case, as is obvious from a reading of the transcript, that Lai made corrupt payments to Chan other than those which involved the applicant, and that such corrupt payments were made at or around the same time as the payments with which the applicant was concerned. The judge was, in other words, aware of the point made, that the list of twelve payments may be unreliable because there were others; that there was also a payment of $180,000 to Chan in July 1999, the time of the third payment on Lai's list, through Michael Wong of Brongham Park, a matter with which the applicant was in no way connected; and that the use of false invoices was not restricted to the listed payments. Indeed, it was put in terms to the witness that the first payment of $350,000 was "in all probability ... in relation to other corrupt matter you had with Mr Chan", an assertion which the witness denied, explaining that he well remembered the first payment on the applicant's behalf because "it was the first time in my lifetime that I gave such a big amount of money, that's why I remember it." (p. 152, appeal bundle). But what told particularly with the judge in support of Lai's testimony were undisputed factors that supported in material aspects the account he gave. There was no question but that Tridant Engineering obtained a contract that had once been awarded to YSH. There was no question but that Brongham Park sold the generators not directly to Tridant but to Hing Yip, and that those generators found their way to the applicant's company at a price substantially in excess of the price paid by Hing Yip to Brongham, a company also owned by Lai. There was no question but that the original tender by Tridant did not include the generators by that were sold Brongham Park through Hing Yip to Tridant; and there was no question but that Tridant obtained its quote or tender not from Brongham Park as it might easily have done but through an intermediary, a company with which Lai was so closely associated. These were the matters to which the judge expressly referred in his Reasons for Verdict as underpinning in essential regards the story given by Lai. 67.In all these circumstances, we are satisfied that the events to which we have been taken as suggesting difficulties for counsel for the applicant at trial did not, when viewed in full context, cause the applicant true prejudice in the conduct of his defence. 68.The complaint about the access that Lai was afforded to his legal advisers in the course of his testimony was a surprising one to put forward as a discrete ground, when one considers that it was a course described by the applicant's counsel at trial, once suggested by the judge, as "absolutely right". That may be why Mr Caplan QC conceded that it was a point which by itself was not sufficient to warrant upsetting the conviction but was merely illustrative of the problem that can be caused by the grant of an immunity which is limited in its scope. The point does not therefore require to be addressed further. (4) The strength of the evidence 69.Grounds 3 and 4 go together. They assert, in essence, that the evidence of Lai so lacked credibility and reliability that the judge ought not to have relied upon it. The complaints and suggested indicia of unreliability are several. 70.The evidence of Lai was that it was he who chose and suggested the figure of $2 million. It was, he said in evidence, a random figure. As to this, the judge said in her Reasons for Verdict:
71.It is argued that the judge did not resolve her disquiet as to this aspect of the evidence which impinged upon the general credibility of the witness Lai. It is said that it is inherently incredible that Lai should have played any part in the approach to the applicant whom he did not then know, for the idea was Chan's, and that Lai's company had by the time of the suggested bribe nothing further to gain. It is argued further that it is inherently not credible that Lai fixed the amount of the bribe, and not credible that he or his company should have been involved in the payments themselves. These are matters which the judge, it is contended, has failed to address, and failed also to address the motive for Lai's involvement since his company had succeeded in securing withdrawal of its tender. It is argued as well that the evidence upon which the trial judge relied as supportive of Lai's account was not truly supported in that it was self-generated evidence. 72.We do not have a transcript of the closing speeches advanced by counsel at trial. We would be surprised indeed if these particular points had not all been made by leading counsel for the applicant and we see from the Reasons for Verdict that points of this ilk were advanced and that the judge had them in mind. She said in terms:
and at para 83 of those Reasons she shows that she was cognizant of the fact that the man to whom the bribe was alleged to have been paid was:
73.This Court is all too familiar with cases of corruption in the construction industry and the powerful influence for commercial benefit that officials and supervisors of various categories are perceived, in the eyes of contractors, to wield. The fact is that the companies in this case were all going concerns, destined to have further contact with the Housing Department. Lai's evidence was that this bout of corruption to which the applicant was said to be a party was not the only corruption in which he engaged with Chan. Quite how that corrupt relationship commenced, we are not in a position to say, but it is evident that Lai and Chan were at one in their willingness to immerse themselves in the stew of corruption to their long-term mutual benefit. Viewed in that light, Chan's request that Lai approach the applicant, and Lai's suggestion of the bribe figure, is not as odd as is made out. Furthermore, whilst in this particular instance Tridant, as the second lowest bidder, seemed destined to obtain the particular contract once YSH withdrew, that was not, according to Lai's testimony, inevitable: see Appeal bundle, p 117. 74.Lai gave evidence before this judge for a full two and a half days and the judge had the benefit, as we have not, of hearing that evidence in all its detail, at the end of which she said (para 81 Reasons for Verdict) that :
75.The testimony of Lai as to why he did what was suggested by Chan - and we should not forget that Chan had told Lai that the applicant already knew what to do, and that we have heard neither from Chan nor the applicant - was revealed in this passage of evidence:
76.As for the figure of $2 million, whilst Lai did at one stage say that he chose the figure randomly, the following passages are relevant:
As Mr Zervos pointed out, there was no evidence as to what the profit margin in fact was. 77.As for supporting indicia, we think that the judge's approach cannot be faulted. It was an admitted fact that for other Housing Authority projects Tridant had obtained quotes directly from Brongham Park and not from Hing Yip. It was also common ground that the original tender was amended; which though not in itself an extraordinary or unusual fact, it was amended to include Vibropower generators for which the sole agent and distributor in Hong Kong was none other than Brongham Park. Beyond that, the testimony of Lai that his company YSH had never before purchased from a subsidiary, an assertion that could readily have been tested, was never challenged. 78.Leaving quite aside the bank documents and the invoices from the bogus company, these indicia in themselves were indeed supportive of the witness's testimony. (5) The Expert Evidence 79.The fifth and final ground of appeal against conviction is an attack on the judge's findings about the expert (and only) testimony adduced on behalf of the applicant at trial. 80.The applicant put into evidence a report, which was unchallenged, by Mr John Battersby, a Chartered Quantity Surveyor, who has been employed in the construction industry in Hong Kong for twenty years. Mr Battersby concluded that there was no inflation of the price of the generator sets and that "Mr SS Lai's suggestion of such inflation would seem rather bizarre". 81.What the judge said was this:
82.The argument is that the judge erred in that the prosecution opened its case on the footing that prices had been inflated to cater for the bribe and that it had been Lai's testimony that prices had been inflated. 83.The sense in which the word "inflate" was used in testimony, and the manner in which the word was introduced, is important. The judge recognised, quite correctly in our view, that the price ultimately charged by Hing Yip was not inflated in the sense of a comparison with prices quoted by others. The fact, seemingly ignored by the expert, is that the original tender by Hing Yip to Tridant was very significantly higher than the tenders by others, and the tender was accordingly lowered; a matter says the expert of "horse trading", as evidenced by a lowering of a competitor's tender from $7.98 million to $7.581 million. That scale of reduction may be horse trading, but the reduction by Hing Yip was, at one swoop, down from $8.537 million to $7.226 million, a difference of $1.394 million. It is noteworthy that Hing Yip's first tender was, in its difference with the price paid to Brongham Park, sufficient in itself to cover this suggested bribe, whereas the second tender was not. 84.The manner and context in which the phrase "inflated price" was introduced into evidence is seen from a passage which we have recited at [9] above, part of which we now reproduce:
85.It was counsel who first used the phrase "inflated price". Although there is reference, again by counsel, to a sale at a price more than the goods are worth, it seems clear enough to us in context that the witness was concentrating on an inflation of price as between Brongham Park (a subsidiary of Hing Yip, be it remembered), and Hing Yip, a company which the witness controlled. In the context of the issue here raised, Mr Battersby's report is remarkable for its lack of any reference whatsoever to the suggested sale by Brongham Park to its parent company Hing Yip of these generators for the sum of $5.872 million. That is not a criticism of Mr Battersby, for we do not know what facts were placed before him. But the issue placed before him seems clear enough, which was to examine, in a vacuum, the tenders forwarded by Hing Yip and how they stood in relation to other tenders and to market prices to end users. At the outset of his report, he stated that:
and that his opinion had been sought:
The problem with this remit is that it is but part of the picture, in the sense to which the judge has correctly referred. It omits the key factor, namely, the price charged by Brongham Park to Hing Yip. 86.In the circumstances, we have described, it is not demonstrated that the judge has erred as suggested. Conclusion 87.We find that the grounds of appeal are not made out. Since the issue of answers refused because of the limited immunities was reasonably arguable, we grant the applicant leave to appeal against conviction and treat the hearing of the application as the appeal. But, for the reasons we have given, the appeal against conviction is dismissed. 88.There is outstanding an application for leave to appeal against sentence which we shall hear on a date to be fixed in consultation with counsel's diaries.
Representation: Mr Jonathan Caplan, QC leading Mr Andrew Macrae, SC and Ms Maggie Wong instructed by Messrs Martin Law & Co for the Applicant Mr Kevin P Zervos, SC, SADPP leading Ms Lynda Shine, SGC and Ms Priscilia Lam, GC of the Department of Justice for the Respondent |