Akai Holdings Ltd (in Compulsory Liquidation) v. James Henry Ting

HCCL 42/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL ACTION NO 42 OF 2005

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BETWEEN

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D E C I S I O N

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1.The principles governing the application to give evidence by video link are fairly summarised in the judgment of Peter Ng J in the Simpson Marine case, HCA 107/2011, which he delivered on 2 September 2013, and I will not repeat them in these short oral reasons which I am giving. I would just identify that I refer to the principles he has summarised in paragraph 18 all the way through to paragraph 23, and also paragraph 25.

2.The question that he addresses, and which I address also in this particular application, is what is the course best calculated to achieve a just result for both parties, and I would add to that by asking what is the best course calculated not only to achieve a just result for both parties but which also enables the court to achieve a just result for both parties.

3.It is obvious that the court’s attitude and approach towards video‑link evidence has shifted over the decades and that is understandable.  This is the natural result of the court’s increasing experience in these fields; experience that has been gained starting from the reception of video‑link evidence from expert witnesses who are extremely busy professionals and who would not, otherwise, be able to fly down to Hong Kong to give evidence; the experience that has been gained when the court has received evidence even from factual witnesses who are abroad, and for whom it would be an expensive or difficult undertaking to come all the way to Hong Kong.

4.The balancing exercise that has to be undertaken must be undertaken by having regard to the character of the witness, the nature of the evidence being adduced, whether it is factual or whether it is expert opinion, the extent to which that evidence is controversial, and the extent to which that witness is going to be subject to cross‑examination as to credit.

5.In this case, Mr Ting’s credibility and integrity is severely challenged and reference has made to pronouncements made by the Court of Final Appeal as to his honesty.  Specifically, the judgment of Lord Woolf has been quoted in which he said that Mr Ting had - and I quote - “properly been found by a jury to have acted with dishonesty, notwithstanding that his convictions had to be set aside”: [2007] 10 HKCFAR 632 at paragraph 52.

6.So that is an important point to note in the balancing exercise.  It is also important to note that Mr Ting, in fact, is the defendant in these proceedings, and that he has put forward a defence to these claims advanced by the liquidators of Akai that he has breached his fiduciary duties and has misappropriated Akai’s assets to his personal benefit, during his stewardship as the former chairman and CEO of Akai, during which period losses exceeding US$1 billion have occurred. 

7.If I may quote from Mr Manzoni SC’s written submissions, he says, and I accept, that this is quintessentially a case in which Mr Ting’s credibility is in issue.  I agree that it is essential to the fair determination of these proceedings that any evidence adduced by Mr Ting must be subject to cross-examination, and that sets the scene for the comparison that has to be made between cross-examination of Mr Ting on issues of credibility, via video-link, or in a room in which the judge of fact will be present and will be able to see him in person.

8.The additional aspects that have to be considered are the extent to which interpretation is necessary and the extent to which the case in question is a document-heavy case.  The bundles that are behind me probably exceed any bundles that I have had to deal with in the trials  I have presided over in the commercial court; and we all appreciate how difficult it is to cross-examine witnesses, even in the courtroom, by referring them to various documents in various different bundles and the time it takes to do that properly.  Those difficulties are greatly augmented if one has to do that long-distance over video-link. 

9.Interpretation is an additional overlay to the existing problems that occur when a witness whose credibility is at stake is being cross‑examined by video-link.  It is difficult enough for a court to assess the credibility of a witness in the courtroom, whose evidence is given in a language that the court is not familiar with, and when the court has to receive that evidence indirectly via an interpreter. Those difficulties would be greatly augmented if the interpretation were to take place abroad via video‑link.

10.In this case, although it has been suggested that Mr Ting might give evidence in English, the court would be most reluctant to force him into a position where he is not allowed, or finds himself unable, to give evidence in the language of his choice.  During his interview with Dr Chen Char-Nie, he communicated in Mandarin.  In the questionnaires filed in court dealing with the need for interpreters, there is a statement to the effect that the defendant needs a Cantonese interpreter, and the only witness from the defendant who is likely to need interpretation is, in fact, Mr Ting.

11.These are the sort of factors that come into play when the question of video-link evidence is to be considered.  The additional factor, of course, is the court’s own experience in receiving video-link evidence.  I can state quite frankly that I find myself in a position where it is possible that I may not be able to properly exercise my duty as a trial judge and make a proper assessment of a witness, whose credibility is going to be challenged, if I were to hear Mr Ting via video-link as opposed to seeing him face‑to‑face when he gives evidence.

12.I am, of course, aware of the injunction on the court against over-emphasising the witness’s demeanour or tone of voice, and I am reminded of the passage that was adopted by Lord Devlin in his book The Judge, which appears and has been quoted in page 339 of Bernstein’s Handbook of Arbitration and Dispute Resolution Practice, volume 1.  I am also reminded of the observations of Litton NPJ in Tradepower (Holdings) Ltd v Tradepower (Hong Kong) Ltd (2009) 12 HKCFAR at paragraph 140. 

13.The analysis of the decision-making process has not been made with any degree of finality or certainly.  Why does a judge believe one witness and not believe another?  It is a composite exercise that requires a judge to examine the evidence that he is receiving in the context of the matters that are raised, and to try to take away some elements of that exercise can only inhibit the judge’s capacity to arrive at a proper and correct judgment.  It is primarily that factor that leads me to the determination that I should refuse this application.

14.I accept the evidence of Dr Chen Char Nie that it is likely that Mr Ting is suffering from PTSD, but, of course, as we all know, and as Dr McFarlane has explained, that condition is usually fluctuating.  Dr Chen says, in paragraph 66 of his second report: 

“As he does not have symptoms of travel phobia, he is fit to travel, but I understand that he may prefer not to come to Hong Kong in view of PTSD. If there is a need for him to give evidence, a long-distance video conference could be considered. There is still the possibility that he might want to avoid it if he finds it too stressful to be reminded of his previous experiences in Hong Kong. In case there is a video conference, care should be taken not to impose threat or insult or otherwise as it will make his mental condition worse.”

15.Those sentiments are echoed by Dr McFarlane, a world expert on PTSD, and the passages that I would like to quote from his report appear at page 10:

“I have little doubt that the incidents he witnessed in prison after his conviction and his fears are of the type of events that can lead to posttraumatic stress disorder.

The history provided by Dr Chen does not specifically provide the background history that leads to the conclusion that the various symptoms, such as the avoidance and exaggerated startle response are present. The score of the Impact of Events Scale is highly suggestive that he has a constellation of symptoms consistent with this diagnosis. The important issue is that these experiences are aligned to specific incidents and threats that occurred in prison, rather than the fact of his arrest or his contact with the police.

This matter is relevant in terms of Mr Ting's capacity to return to Hong Kong to give evidence.  It is not the fact of being in Hong Kong or the contact with the authorities that has led to his possible PTSD but rather his imprisonment after his conviction.  Dr Chen indicates that a videoconference may worsen Mr Ting's condition because of the associated stress.  I would suggest that the stress of the very fact of this legal case is a more salient stressor than simply giving evidence.”

16.I also refer to his Comment on page 11:

“[The draft affirmation of Mr Ting] highlights the significant anxieties that exist in Mr Ting's mind about the general proceedings. In my opinion the risks to him of being arrested is not a matter for me to comment upon. It would suffice to say however, that the facts of the proceedings and the legal issues contained are a substantial cause of his fears rather than the more specific issues of what he might be exposed to during his re-incarceration. These are particularly relevant to the question of the significance of his posttraumatic stress disorder symptoms regarding what he witnessed and experienced whilst in prison. Hence, this statement supports my opinion that it is the more general threat to him of the larger legal proceedings then the simple fact of his return to Hong Kong, which is the substantive issue.”

17.I also refer to these passages from pages 12 to 14 of Dr McFarlane’s report :

“…For example, many individuals in civil proceedings suing a third party in relation to a condition such as posttraumatic stress disorder are required to give evidence in chief, despite the need to revisit many highly traumatic and distressing events and memories. Despite the risks to these individuals of this process, in my experience this does not lead to any prolonged or enduring increase in the severity of their condition.

Hence, there will be some risk to Mr Ting in relation to his returning to Hong Kong as part of him facing the civil proceedings but I do not believe that this will be in any substantial degree minimised by his provision of evidence by videoconference. Rather, it is the fact of the proceedings rather than the means by which he will give evidence that is the issue that presents the risk to him.

…

In summary, while the legal action against Mr Ting represents a risk of exacerbating his anxiety and depression, I am of the opinion that the issues identified in Dr Chen or Dr Dong's reports do not provide sufficient psychiatric evidence as to explain why he cannot give evidence directly to the court, even if he does have a PTSD.

…

In my opinion, any individual who is subject to civil or criminal proceedings undergoes a significant degree of distress. This stress is likely to lead to symptoms such as rumination, anxiety, and associated physiological symptoms such as palpitations and tremor. These symptoms are likely to be of a transitory nature with a significant degree of relief once the individual has completed both evidence in chief and cross‑examination. The risks of such stress to Mr Ting in terms of any substantial medical risk are in the order of 1 to 2 on the scale [of 1 to 10].

…

If it is assumed that Mr Ting does have a posttraumatic stress disorder specifically related to his arrest by the immigration officials on his return to Hong Kong in 2002 as indicated by Dr Dong, the stresses could be modified by providing him with an accompanying legal practitioner through this procedure. Hence, an advocate to manage and to protect against any challenge or possible charge in this environment would provide him with significant reassurance. Being accompanied by a family member or friend would equally be significantly reassuring in this domain. Furthermore; if Mr Ting fears his arrest and imprisonment as set out in his affirmation, this is a matter to be resolved through his legal officers and the protections offered by the law, and not an area where I can comment.

If it is accepted that he suffers from a major depressive disorder/adjustment disorder with depression, and/or posttraumatic stress disorder, psychiatric treatment would have a beneficial impact. This would include both the prescription of antidepressant medication and the provision of cognitive behavioural psychotherapy. This approach would be particularly helpful in assisting him to deal with his avoidance symptoms. However, the fact that Mr Ting is deemed to be fit to give evidence by videoconference suggests that his level of symptomatology is not debilitating to the extent that he should be prevented in proceeding without receipt of such treatment.

…

On the basis of the information provided, I do not believe that there is a major threat to Mr Ting's medical condition by being required to travel to Hong Kong to give evidence.  If he did have posttraumatic stress disorder, there are ways that this could be effectively managed by assisting his carriage through immigration and customs.”

18.I would add to that, that to alleviate that risk, I would also ask the parties to make provision for his evidence not to be given in this courtroom, but in some other venue nearby, where the court could adjourn to, to receive his evidence.  Obviously, it will be quite a task transporting all the various bundles that we may need, but that is certainly a liberty that I accord to Mr Ting for him to utilise if he should so wish.

19.In addition to what has been said by Dr Chen, I will make sure that the cross-examination of Mr Ting is conducted properly, that he is not badgered, that he is not put in a position of discomfort, and that, at the very first sign of distress over and above that normally exhibited by a witness, I will adjourn and take other steps to ensure that his symptoms are properly attended to.

20.The balancing exercise requires us to look at the problems Mr Ting would face if he were to come to Hong Kong, and the problems the rest of us would face if he were to give evidence by video-link. I am very firmly convinced that the proper exercise of my discretion on this question compels me to dismiss the application sought.

21.There are two other aspects of the application I must mention.  I will do so as briefly as I can.  The first is the risk of re-arrest.  I need not go through the matters that I exchanged with Mr Kat in the course of his submissions, but it is clear from my understanding of the past history of this case, the prosecution that took place, the appeals that took place, the time that he spent in prison – which I think was to the order of 2 years, and which was greatly instrumental in the decision of the Court of Final Appeal not to order a retrial – that, so far as those matters are concerned, the risk of his arrest when he returns to Hong Kong is nil to so extremely minimal as not to require my consideration.

22.I also had regard to the letters that have been exchanged between the liquidators and the Commercial Crime Bureau.  These are the letters dated 27 May 2013 and the reply from the Commercial Crime Bureau dated 30 May 2013. From the assurance I have received, I am satisfied that the liquidators have not, since 30 May 2013, furnished the Commercial Crime Bureau with any further material which could constitute evidence for future prosecution.

23.I am satisfied from these matters that the risk of arrest is nil to negligible.  The solicitors acting for Mr Ting should relay that to him, in order to assure him that, should he come to Hong Kong, it is most unlikely that he would be re-arrested.

24.Of course, a person who suffers from anxiety will invariably still be concerned but the reality, from what I can see, is that his concern flows from him having to address the issues that will come up at the trial and to give evidence about these issues.  However, as Professor McFarlane has said, steps can be taken to ensure that he travels to Hong Kong accompanied and to facilitate his arrival here, through Immigration, and so on.

25.Finally, there is this issue of the impact of his return on the pending bankruptcy proceedings.  The relevance of the bankruptcy proceedings and the future course it may take upon his return to Hong Kong to give evidence is quite peripheral, as far as I am concerned.  The question that I have to ask is what is just and fair to the parties for the proper resolution of these proceedings?

26.Mr Ting has the freedom to choose not to give evidence.  He has the freedom to choose not to come to Hong Kong but, if he chooses to give evidence, then he should only give evidence in Hong Kong, not via video-link, and if his choice to do so renders him at a disadvantage so far as any jurisdictional defences to his bankruptcy proceedings are concerned, then, whilst I am alive to that, I find that aspect to be peripheral, and certainly one that does not cause me to exercise my discretion in any other way.

27.Perhaps I can add as an aside that, even if he were to be served with a new bankruptcy petition, it is most unlikely that the bankruptcy court would be moved to make any orders against him before his evidence has been completed and before he is on a flight out of here. 

28.These are my reasons for my decision.  Any application for costs?

Submissions on costs

29.Costs to the plaintiff in any event with certificate for two counsel, to be taxed if not agreed. 

Mr Charles Manzoni, SC and Mr Jason Karas (Solicitor Advocate), instructed by Hogan Lovells, for the plaintiff

Mr Nigel Kat and Mr Hew Yang Wahn, instructed by Robertsons, for the 4^th defendant