Securities and Futures Commission v. Chui Wing Nin

HCMA 15/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO 15 OF 2013

(ON APPEAL FROM ESS 27729 & 27730 OF 2011)

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J U D G M E N T

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INTRODUCTION

1.This Appellant, a man of pervious good character in his 40s,

appeals against his conviction after trial in the Magistrates’ Court on two charges of insider dealing, contrary to s.291(1)(a) and (8) of the Securities and Futures Ordinance, Cap. 571, and punishable under s.303 thereof. Whenever I referin this judgmentto a section or subsection it will, save where the contrary is stated, be to those of that Ordinance as it read at the time material to the charges.

2.As relevant to the present charges, s.291(1)(a) provided that a person “connected with a listed corporation and having information which he knows is relevant information in relation to the corporation shall not…deal in the listed securities of the corporation”. Section 291(8) criminalized such conduct subject to the defences provided by sections 292, 293 and 294. The statutory defence relied upon by the Appellant at trial and now on appeal is the one provided by s.292(3) which provided, as relevant to the present charges, that it is a defence for a person “to prove that the purpose for which he dealt in…the listed securities…in question…was not, or, where there was more than one purpose, the purposes for which he dealt in…the listed securities…did not include, the purpose of…avoiding or reducing a loss…by using relevant information”. Section 303 is the penalties section.

3.The persons who are to be regarded as connected with a corporation include any employee of the corporation. Section 287(1)(a) so provided.

4.The meaning of “relevant information” was provided by s.285(1). It included specific information about the corporation “which is not generally known to the persons who are accustomed or would be likely to deal in the listed securities of the corporation but which would if it were generally known to them be likely to materially affect the price of the listed securities”.

5.Charge 1 (by which I mean the charge brought under Amended Summons ESS 27729/2011) says that the Appellant, on 9 September 2008, in Hong Kong, “being connected with a listed corporation namely, CITIC Pacific Limited (‘CITIC’), and having information which [he] knew was relevant information in relation [to] CITIC namely:

(i)   the mark to market value for the various leveraged foreign exchange target redemption forward contracts (‘TRFCs’) held by CITIC if the AUD/USD spot rate fell to 0.85, 0.82 or 0.80 and the EUR/USD spot rate fell to 1.45, 1.43 or 1.40 would be around HK$-4.6 billion, HK$-6.6 billion, HK$-8.6 billion respectively;

(ii)   the amount of AUD deliverable under the various TRFCs held by CITIC if the AUD/USD spot rate fell to 0.85, 0.82 or 0.80 would be around AUD6.7 billion, AUD7.7 billion, AUD8.6 billion respectively;

… dealt in the listed securities of CITIC”. Charge 2 (by which I mean the charge brought under Amended Summons ESS 27730/2011) reads the sameas Charge 1 except that the date is 12 September 2008.

6.At the time relevant to these charges, the elements of the offence of insider dealing contrary to s.291(a) and (8) and punishable under s.303 were:

(i)   being a person connected with a listed corporation;

(ii)   having relevant information;

(iii)   knowing that it is relevant information; and

(iv)   dealing in the listed securities of the corporation or their derivatives or in the listed securities of a related corporation of the corporation or their derivatives.

Subject to “relevant information” as defined by section 285(1) now being “inside information” as defined thereby, those are still the elements of this offence. Once the prosecution has proved those elements, the offence is proved subject only to the defence provided by s.292(3) which, the Court of Appeal said in HKSAR v Du Jun, CACC 334/2009, 20 September 2012, at para. 24, places a persuasive burden on the accused.

7.The amended perfected grounds of appeal filed on the Appellant’s behalf read as follows:

“(1) The learned Magistrate failed to evaluate or evaluate adequately the material points of the defence case, or to give adequate reasons in his evaluation of those points, in particular, the respective submissions contained in the Appellant’s Written Final Submissions dated 19^th September 2012 over PW17 Miss Stella Fung’s integrity, honesty, impartiality, professionalism and flagrant disregard of her duties under the Code of Conduct for Expert Witnesses, as well as other aspects of the evidence in the general issue.

(2) Other than assessing the credibility of PW17 Miss Stella Fung, the learned Magistrate erred in failing to conduct his own evaluation of her evidence or test the accuracy of her conclusions.

(3) In the premises, the convictions are unsafe and unsatisfactory and should be quashed.”

That, I regret to have to say, is not the way in which grounds of appeal should be drafted.  A ground of appeal like Ground 1 should succinctly state all the points which it is said that the Magistrate failed to evaluate or evaluate adequately. It should not use expressions like “in particular”. And it should not leave the respondent and the court to comb through another document. In fairness, it should be said that those difficulties were lessened by the helpful written submissions provided by counsel for the Appellant at the same time as when the amended grounds were filed.

8.That the Appellant was an employee of CITIC at the material time, that CITIC was and is a listed corporation and that he dealt in its listed securities while he was an employee of its are all admitted facts. So there is no dispute that he, being a person connected with a listed corporation, dealt in its listed securities.

9.The issues are as follows. Did he have the information specified in the charges? Was it relevant information? If it was, did he know that it was? Even If all these questions are answered “Yes”, and therefore against him, does he have the statutory defence provided by s.292(3)?

10.No submissions of no case to answer was made at the trial. The prosecution had led evidence upon which the Appellant could be convicted. As was his right, he chose not to go into the witness-box himself and not to call any witness to testify for him. At the trial, he relied on the submissions made for him by his counsel.  

11.His first ground of appeal is directed to complaining that the Magistrate failed to evaluate or evaluate adequately those submissions and failed to give adequate reasons for rejecting them. Essentially those submissions constituted an attack upon the expert evidence of Miss Stella Fung who was called by the prosecution as an expert and gave it her opinion that the information specified in the charges was relevant information, being not generally known to the market and being price-sensitive. Her integrity, honesty, impartiality and professionalism are impugned. It is said that she was in flagrant disregard of her duties under the Code of Conduct for Expert Witnesses. In that way, her expert evidence was attacked.

12.Ground 2 follows on from that to complain that the Magistrate had erred by failing to conduct his own evaluation of Miss Fung’s evidence and by failing to test the accuracy of her conclusions.

13.On the basis of the matters complained of in grounds 1 and 2, it is submitted under ground 3 that the convictions are unsafe and unsatisfactory and should be quashed.

14.Before the perfected grounds of appeal were amended, they contained a specific complaint that the Magistrate had erred in not finding that the statutory defence provided by s.292(3) had been made out. There is no mention of that statutory defence in the amended perfected grounds of appeal. But Mr Joseph Tse SC for the Appellant told me, when I asked him about it, that the s.292(3) defence is still relied upon. The complaint that the Magistrate had erred in not finding that the s.292(3) defence had been made out was, Mr Tse said, part of what is specifically complained of in the amended perfected grounds of appeal.

GIVING REASONS

15.As to the law, I have received detailed arguments from Mr Tse for the Appellant and from Mr Adrian Bell SC for the Respondent on two matters which come together, namely the duty of a court to give reasons and the right to a fair hearing. These two matters come together in that it is argued that the Magistrate failed to give adequate reasons and that such failure deprived the Appellant of his right to a fair hearing. As to that, the requirement of a fair hearing is not confined to fairness at the trial stage but includes fairness at the appellate stage (or stages). This is tied in with the giving of reasons by a trial court because an appellate court, in order to decide whether to affirm or disturb the trial court’s decision, must be able to discern what were the reasons for the trial court’s decision.

16.At the heart of the Appellant’s case is his complaint that the Magistrate’s reasons do not address or adequately address the criticismwhich the defence made against Miss Fung and her evidence. Everything else argued on the Appellant’s behalf (being essentially the complaint that the Magistrate had erred in failing to conduct his own evaluation of Miss Fung’s evidence and by failing to test the accuracy of her conclusions, the complaint that the Magistrate had erred in not finding that the s.292(3) defence had been made out, and the complaint that the convictions are unsafe and unsatisfactory) depend on the complaint that the Magistrate’s reasons do not address or adequately address the criticism which the defence made against Miss Fung and her evidence.

17.The cases drawn to my attention include: a number of cases on the duty of a court to give reasons; a number of cases on the right to a fair hearing; and a number of cases on the duties and obligations of an expert witness.

18.As to the right to a fair hearing, Mr Tse has addressed me on, among other cases, three cases decided by the Court of Final Appeal, namely HKSAR v Lee Ming Tee (2001) 4 HKCFAR 133, Chong Ching Yuen v HKSAR (2004) 7 HKCFAR 126 and Hau Tung Ying v HKSAR (2011) 14 HKCFAR 453. The right to a fair hearing is a fundamental right. Of that there can be no doubt, and I move on at once to why it is said on the Appellant’s behalf that he has been deprived of a fair hearing.

19.The duty of a judge (and of course a magistrate as well) to give adequate reasons were said by Chan CJHC (as he then was) to be “a principle of paramount importance in the common law system”. He said that in the following passage inZhuo Cui Hao v Ting Fung Yee [1999] 3 HKC 634 at pp. 639C-640A:

“Generally speaking, a professional judge is under a duty to analyse in his judgment the material points in the evidence of the case and give reasons as to why he has reached a particular conclusion or decision. This is the only way to make people understand why their evidence is not accepted by the court and why they lose in a case. Only by this can justice be seen to be done. Furthermore, the losing party needs to be clear on whether there is any error in the reasons for the decision given by the court before he can decide whether to appeal or not, and, at a later stage, submit to the Court of Appeal his grounds of appeal in order to seek to set aside the original decision. A professional judge is under a duty to give adequate reasons for any decision which he has made. This is a principle of paramount importance in the common law system. This principle is quite clear. Recently the Court of Final Appeal has also mentioned this important principle in Oriental Daily Publisher Ltd v Commissioner for Television and Entertainment Licensing Authority [1998] 4 HKC 505 at 514. Nevertheless, from time to time some professional judges still forget to give adequate reasons in their judgments. Take the United Kingdom as an example. The English Court of Appeal has recently found it necessary to reiterate this principle in Flannery & Anor v Halifax Estate Agencies Ltd (The Independent, 26 February 1999, The Times, 4 March 1999, unreported). There are some similarities between that case and the one before us in that the trial of that case lasted for eight days and a large part of the 29-page judgment given by the trial judge was on the disputes of facts, among which the more important ones were related to the evidence of experts from both sides. In the final part of the judgment in that case, the trial judge simply stated that he accepted the expert evidence of a particular party and entered judgment in favour of that party without specifically analysing the evidence or giving reasons as to why he accepted the evidence of that party. The English Court of Appeal took the view that from such a brief and simple judgment it was rather difficult for anyone to find out the reasons for the decision. For this reason the original decision was set aside. After the hearing of the present appeal, we searched in the Internet and obtained the original text of that judgment. In the judgment given by the English Court of Appeal, there was a rather detailed discussion on the duty of professional judges to give adequate reasons for their decisions. In our view, it is worth taking note of the guidelines reiterated in that judgment.”

20.In the Court of Final Appeal case referred to in that passage, namely Oriental Daily Publisher v Commissioner for Television and Entertainment Licensing Authority (1997-98) 1 HKCFAR 279, Li CJ spoke as follows at p.290E-F about the benefits of giving reasons:

“First, it would impose desirable intellectual discipline and concentrate attention on the relevant issues. It would thus assist in ensuring that any decision is made on proper grounds and contribute to the effective disposal by the tribunal of its work. Secondly, reasons would assist in demonstrating to the parties that the tribunal has carried out its task properly and would enable them to decide on the appropriate course of action in the case at hand, including whether to appeal or apply for judicial review.”

He stressed at pp.290J-291A that:

“Where there is a duty to give reasons, it must bedischarged by giving adequate reasons. What would amount to adequate reasons for a decision would depend on the context in which the decision maker is operating and the circumstances of the case in question.”

At pp.292J-293A, he pointed out the difference between stating conclusions and giving reasons.

21.As to that difference, Bokhary PJ stressed (at p.296H) that stating the conclusion to which a court or tribunal came to is one thing and that saying why it came to that conclusion is another thing altogether.

22.Picking up what Li CJ said in the Oriental case about the adequacy of reasons, Gleeson NPJ said this in HKSAR v Egan (2010) 13 HKCFAR 314 at para. 387:

“The adequacy of reasons in the circumstances of a particular case is to be considered in the light of the purposes that are served by the obligation to give reasons. It promotes good decision-making, and the acceptability of decisions to the public. It means that the parties are given an explanation of the outcome. It serves the interests of the parties and the public by facilitating appropriate appellate supervision.”

DUTIES AND RESPONSIBILITIES OF EXPERT WITNESSES

23.Leaving the cases on the giving of reasons, I turn to the duties and responsibilities of expert witnesses. Among the cases cited to me on those duties and responsibilities is The Ikarian Reefer[1993] 2 Lloyds’s Rep 68 decided by Creswell J in the English Commercial Court. That was a civil case rather than a criminal one, but it did involve a very serious allegation, namely an allegation by the underwriters that the vessel had been deliberately set on fire with the shipowners’ connivance. Even so, I should stress that the importance of expert witnesses adhering to their duties and responsibilities is the greatest when the expert is giving evidence for the prosecution in a criminal trial.

24.Having made that point, I consider it useful to set out the following statement made by Creswell J in The Ikarian Reefer at p.81 column 2 to p.82 column one:

“The duties and responsibilities of expert witnesses in civil cases include the following:

1. Expert evidence presented to the Court should be, and should be seen to be, the independent product of the expert uninfluenced as to form or content by the exigencies of litigation (Whitehouse v Jordan, [1981] 1 WLR 246 at

p.256, per Lord Wilberforce).

2. An expert witness should provide independent assistance to the Court by way of objective unbiased opinion in relation to matters within his expertise (see Polivitte Ltd v Commercial Union Assurance Co Plc, [1987] 1 Lloyd's Rep 379 at p.386 per Mr Justice Garland and Re J, [1990] FCR 193 per Mr Justice Cazalet). An expert witness in the High Court should never assume the role of an advocate.

3. An expert witness should state the facts or assumption upon which his opinion is based. He should not omit to consider material facts which could detract from his concluded opinion (Re J sup).

4. An expert witness should make it clear when a particular question or issue falls outside his expertise.

5. If an expert's opinion is not properly researched because he considers that insufficient data is available, then this must be stated with an indication that the opinion is no more than a provisional one (Re J sup). In cases where an expert witness who has prepared a report could not assert that the report contained the truth, the whole truth and nothing but the truth without some qualification, that qualification should be stated in the report (Derby & Co Ltd and Others v Weldon and Others, The Times, Nov 9, 1990 per Lord Justice Staughton).

6. If, after exchange of reports, an expert witness changes his view on a material matter having read the other side's expert's report or for any other reason, such change of view should be communicated (through legal representatives) to the other side without delay and when appropriate to the Court.

7. Where expert evidence refers to photographs, plans, calculations, analyses, measurements, survey reports or other similar documents, these must be provided to the opposite party at the same time as the exchange of reports (see 15.5 of the Guide to Commercial Court Practice).”

25.The matter of expert evidence was addressed in a recent decision of the Court of Final Appeal which is a decision in a criminal case, the offence concerned being of false trading in the securities market. It is the case of Fu Kor Kuen Patrick and Anor v HKSAR, FACC No 4 of 2011 (24 May 2012). Litton NPJ (at paras 25-27) and Gleeson NPJ (at paras 45-51) stressed the importance of expert witnesses confining their evidence to matters within their field of expertise and the danger that arises if they stray beyond it.

26.The forgoing is as much as I think it necessary to say on the law as to giving reasons and the law as to expert evidence.

COMPLAINTS AND SUBMISSIONS

27.The matters on which defence counsel addressed the Magistrate in the course of impugning Miss Fung’s integrity, honesty, impartiality and professionalism and thus attacking her expert evidence that the information specified in the charges was relevant information, included the following matters:

(1) a general complaint of a lack of impartiality on Miss Fung’s part;

(2) the duties imposed on her and which she agreed to be bound by;

(3) the general complaint that she had deliberately breached the duties imposed by the Code of Conduct for Expert Witnesses;

(4) a general complaint that she had in her expert reports expressed her opinion on five areas beyond her expertise;

(5) specific complaints that she had failed to reveal her lack of expertise in TRFCs, and that she had deliberately presented herself in her reports as an expert thereon, had secretly referred to website material and had failed to disclose that in her reports or to the defence;

(6) specific complaints that the matters complained of in (5) above were deliberate;

(7) specific complaints that she had in her first report expressed opinions on accounting treatment and foreign exchange matters beyond her expertise;

(8) specific complaints that she had made specific errors between two different types of financial instruments, that she nevertheless maintained that she had known the difference all along, that her error had been contributed to by her not working from the original document containing the information, that this showed a lack of professionalism, and that her error had resulted in her giving the wrong figure in her analysis, thus presenting a misleading picture;

(9) a general complaint against her integrity in the form of an allegation of an improper motive on her part to prejudice the defence and favour the prosecution (which general complaint was accompanied by the defence’s request to the Magistrate for specific findings as to whether the breaches complained of were deliberate or inadvertent);

(10) a specific complaint that parts of para. 11(a) of her first report were unsupported by evidence;

(11) specific complaints against the methodology used in her analysis in para. 11(b) of that report, it being urged that she had gone beyond her expertise, failed to state that qualification, made comments without any evidential basis, misstated information, and failed in her duty to correct in her second report mistakes made in her first report.

(12) Specific complaints that she did not in her first report reveal that she had not looked at the source material Exhibit P19 for the purposes of conducting her analysis and that she thus presented a misleading picture that her opinion was based on a full consideration of that exhibit;

(13) a specific complaint that in her analysis in para. 38 of her first report she did not truly understand TRFCs and therefore formed a wrong opinion;

(14) a specific complaint that in that paragraph she failed, when giving that opinion, to consider the effect of remedies available to the company and therefore produced an over-simplistic and incomplete analysis;

(15) specific complaints that she gave her opinion on areas beyond her expertise, and deliberately failed to disclose that;

(16) a specific complaint that she lied when saying in evidence that she knew the difference between the two financial instruments concerned;

(17) a specific complaint that she went beyond her expertise and made a speculative comment in her second report, which comment was clearly inadmissible, but failed to say that it was only a general comment;

(18) specific complaints that she repeated in her second report mistakes made in her first report, failing to recognise and correct them;

(19) submissions challenging the opinions in her second report;

(20) Further specific complaints of repetition in her second report of mistakes made in her first report;

(21) specific complaints that she, having recognised in her second report a new point after sight of Exhibit P19, failed to correct her first report, and that her analysis involved making assumptions which she did not state were assumptions;

(22) a specific complaint that her implied conclusion in para. 22 of her second report was contrary to Exhibit P19 and that this amounted to incompetence or a lack of professionalism;

(23) a further general complaint that she went beyond her expertise;

(24) submissions that her opinion on general investors’ reaction to the mark to market and AUD deliverable were rebutted by the financial articles produced in her first report because none of them mentioned those values, and hence that investors were not interested in them and, further, that her opinion on market participants’ reaction was not supported by any example of actual past incident;

(25) general complaints against her suitability, integrity, credibility and reliability based on earlier complaints; and

(26) a further complaint that her opinion on general investors’ reaction was unsupported by any evidence.

APPELLANT’S ARGUMENTS

28.In respect of the matters set out as items (1)-(26) of para. 27 above, what Mr Tse for the Appellant says may be summarised as follows. The Magistrate did not give any of the rulingssought. He did not express anyconsideration of the submissions advanced. He did not discuss any of the complaints made apart from saying, without giving any reasons, as follows. In respect of item (5), he said that Miss Fung’s copying of the definition of TRFCs was minor. In respect of item (8), he said that her error was minor. In respect of item (12), he said that her not looking at Exhibit P19 was a minor inadequacy.

RESPONDENT’S ARGUMENTS

29.The essence of what Mr Bell for the Respondent says in response is that each and every one of these items is unsubstantiated. Mr Bell also stressed that what Miss Fung’s evidence properly went to was limited. He stressed that reasons need not deal with every point raised and that the exercise had to be approached with a sense of realism. He said that whether reasons are adequate depends on whether there was something plausible to reject, saying that there was nothing of the kind in the present case.

MY VIEW

30.As to that last point, I would not erect it as a principle. I accept, however, that it is a consideration. But it is not to be forgotten that there is no burden on an accused to prove his innocence by putting forward plausible explanations.

31.The approach to the giving of reasons certainly does involve realism. But what Mr Tse says cannot all be simply and silently dismissed as unrealistic.

32.It is certainly true that reasons do not have to single out each and every point made and discuss them all. But the Appellant’s case does not depend on contending that reasons have to do that much.

33.Ultimately I am of the view that the Magistrate, whose conscientiousness and ability in general I do not question, did not say anything, not even of a general nature, to give an adequate indication that he had given due consideration to a very sustained attack on Miss Fung’s expert evidence. I am not saying that her expert evidence was not evidence of a quality on which a court can properly convict after giving, and showing that it has given, that attack due consideration. Nor am I saying that Miss Fung is properly to be criticised at all, let alone as severely as she was by the defence. But I do not feel able to say that what the defence said about her evidence can be dismissed out of hand so that the Magistrate could in effect ignore it. This approach can be seen in the joint judgment of Gleeson CJ and Kiefel J in the High Court of Australia in the case of AK v Western Australia (2008) 232 CLR 438. In holding that the judge should have given reasons for rejecting the defence’s point on identification,they observed (at para. 16)that the judge:

“may well have thought it was a fairly hopeless point, but it was seriously put and was not entirely lacking in substance”.

CONCLUSION

34.In all the circumstances, I am of the view that the Appellant did not receive adequate reasons for the decision against him, and that this omission deprived him of a fair hearing. Here I bear in mind the statement of Bokhary PJ in Chong Ching Yuen v HKSAR (above) at p.135 B-C relied upon by Mr Tse:

“No appellate court would lightly declare a trial unfair. But where it concludes that a trial was unfair, that leaves little (if any) room for saying in effect that such unfairness did not really matter.”

35.As to whether or not an error should result in a conviction in the Magistrates’ Court being disturbed on appeal, the test is, the Court of Final Appeal said in Ching Kwok Yin v HKSAR (2000) 3 HKCFAR 387 at p.390 H, “whether there has been in the Magistrates’ Court an error which makes it just that the appeal should be allowed and the conviction set aside.” That, as the Court of Final Appeal said in Ko Man Chun v HKSAR (2010) 13 HKCFAR 123 at para. 8 “goes to whether the conviction was inevitable so that the error was harmless”. I do not feel able to go so far as to say that these convictions were inevitable.

36.It is therefore necessary to intervene in the Appellant’s favour. That leaves the question: to what extent?

37.On that question, I will hear the parties on whether the appeal should be allowed to the extent of entering acquittals on these charges or, instead, to the extent of directing that, in the words of s.119(1)(d) of the Magistrates Ordinance, Cap. 227, “the case shall be heard de novo by a magistrate”.

[Submissions on retrial, costs and bail]

Date of handing down of reasons for ordering a retrial: 17 September 2013

38.Immediately after delivering the foregoing judgment, I heard submissions on the question of a retrial, which was asked for by Mr Bell on the Respondent’s behalf and opposed by Mr Tse on the Appellant’s behalf. I ordered a retrial (after allowing the appeal to quash the convictions and set aside the sentences), awarded the costs of the appeal to the Appellant with a certificate for two counsel (Mr Tse not seeking costs in the Magistrates’ Court and Mr Bell not opposing costs in this Court or a certificate for two counsel), and admitted the Appellant to bail pending retrial (such bail being on the same terms as those originally set in the Magistrates’ Court and not being opposed by Mr Bell). I said that I would hand down my reasons for ordering a retrial, and I now do so.

39.On the question of a retrial, my attention was drawn to para. 7-78 at p.669 of Archbold Hong Kong 2013 and to the decision of the Court of Final Appeal in Mok Kin Kau v. HKSAR (2008) 11 HKCFAR 1. Whether or not to order a retrial is a matter of discretion, the discretion to be exercised according to what is just in all the circumstances. In Mok’s case it was said at para. 10 that:

“Retrials have their place in our criminal justice system. But bringing matters to a conclusion without undue delay is an important feature of that system. So is the avoidance of oppression. These notions have shaped the accepted norms of our courts’ practice as to retrials.”

I had that in mind when I decided to order a retrial.

40.In seeking a retrial, Mr Bell’s submissions were essentially to the effect that the prosecution’s evidence is strong; that it was not contradictedby any defence evidence, factual or expert, at the trial; that the charges are serious and concern the integrity of the market and the need to protect the public from insider dealing; that although the Appellant has served most of his prison sentence,  there are the fines and the disqualification to consider; and that the fact that the Appellant has only got two weeks of his prison sentence left to serve can be taken into account if he is convicted at the retrial, so that he may not have to return to prison even if convicted again. Mr Bell stressed that the appeal succeeded not because of any inadequacy in the prosecution’s evidence but only because the Magistrate had unfortunately failed to give adequate reasons for convicting.

41.Mr Tse’s points in opposing a retrial were essentially as follows. There has been considerable delay in this case (as to which he handed up a document setting out the procedural history of the case, which I have considered). The Appellant would have been released from prison in two weeks, after having been in custody for a considerable period of time. The quashing of the convictions was not based on any technicality but instead on the trial court’s failure to give the Appellant the reasons required to satisfy his right to a fair hearing. Convictions at the retrial are not inevitable. It depends on expert evidence. While the charges may be serious, they have not been regarded as being so serious as to require trial in a court higher than the Magistrates’ Court. The Appellant has lost his employment. There has been a considerable amount of publicity on the case. Going through a retrial would be an ordeal. As to the public interest, a retrial would involve the expenditure of public money.

42.Both counsel’s points have some substance. The question is whether, all of them duly weighed and considered, the just course can be seen to be a retrial. And I think that the charges are serious enough and the prosecution’s case appears to be strong enough to make it in the public interest and just to have this matter go to a retrial even though that would be something of an ordeal for the Appellant, as all criminal trials are, to a greater and lesser extent, something of an ordeal for the person on trial. In deciding on a retrial, I have not assumed that the Appellant will not have to go back to prison even if he is convicted again. But having ordered a retrial, I will say that it seems to me to be appropriate for him to be dealt with in such a way, if convicted again, as would avoid his going back to prison. His prison sentence, if he is convicted again, could be a sentence to time already served.

43.For the foregoing reasons, there will be a retrial. I order, in the words of s.119(1)(d) of the Magistrates Ordinance, that “the case shall be heard de novo by a magistrate.” It will no doubt be heard by a Magistrate other than the one who heard the first trial. I wish to make it clear that I say that without criticising the Magistrate who heard the first trial.

44.Finally, I thank counsel on both sides for their assistance.

Mr Joseph Tse SC and Miss Doris Ho, instructed by PC Woo & Co, for the appellant

Mr Adrian Bell SC and Mr Derek Chan, instructed by the Securities and Futures Commission, for the respondent