HKSAR v. Sze Mei Mun and Others
Read the full judgment text of CACC 60/2013 on BabelCite. This Court of Appeal judgment was delivered on 14 May 2014.
1. The applicants seek leave to appeal against their convictions after trial by District Court Judge Geiser of a charge of conspiracy to export unmanifested cargo, namely marked oil, contrary to section 18(1)(b) of the Import and Export Ordinance, Cap. 60 (“I & E Ordinance”) and section 159A of the Crimes Ordinance, Cap. 200 (Charge 1) and of various related charges of dealing with property known or believed to represent the proceeds of an indictable offence (Charges 2 to 8).
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CACC 60/2013 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF APPEAL CRIMINAL APPEAL NO. 60 OF 2013 (ON APPEAL FROM DCCC 3 OF 2011) ____________ BETWEEN
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________________________ J U D G M E N T ________________________ Hon Lunn JA (giving the Judgment of the Court) : 1.The applicants seek leave to appeal against their convictions after trial by District Court Judge Geiser of a charge of conspiracy to export unmanifested cargo, namely marked oil, contrary to section 18(1)(b) of the Import and Export Ordinance, Cap. 60 (“I & E Ordinance”) and section 159A of the Crimes Ordinance, Cap. 200 (Charge 1) and of various related charges of dealing with property known or believed to represent the proceeds of an indictable offence (Charges 2 to 8). Charge 1 2.The Particulars of Offence of Charge 1 averred that between 31 and May 2009 and 1 February 2010 the applicants had conspired together and with Cheng Kam Shui, Feng Jiu, Chen Ruihong, Huang Shunping and Shi Rubin to export unmanifested cargo, namely marked oil. The latter four stipulated names were Masters (“the four Masters”) of four fishing vessels on to which it was alleged that marked oil was loaded and then smuggled out of Hong Kong and into the Mainland. Charges 2-8 3.The Particulars of Offence of each of Charges 2 to 8 averred that the named applicant(s) had dealt with the proceeds of an indictable offence, namely stipulated amounts of money, in various periods of time in the overall period 31 May 2009 to 3 May 2010.
Verdicts 4.All of the applicants were convicted of Charge 1. 5.The 1st and 2nd applicants were convicted of Charges 2 and 6; the 3rd applicant of Charges 3 and 7; the 4th applicant of Charge 5; and the 5th applicant of Charge 4. All of them were convicted by the judge on the basis that they knew that the property with which they dealt was the proceeds of an indictable offence, in particular that alleged in Charge 1. 6.The 1st and 2nd applicants were found not guilty of Charge 7 and the 5th applicant found not guilty of Charge 8. THE TRIAL Personal relationships 7.The relationship between the applicants and with others was established by admitted facts. At all material times, the 1st and 2nd applicants cohabited in a flat at Bel-Air on the Peak and had four children. The 3rd applicant was married to the 2nd applicant’s younger sister, of which union the 4th applicant was their son. Finally, the 5th applicant married Cheng Kam Shui in 1988. The prosecution case Charge 1 8.The nub of the prosecution case was that the applicants conspired with each other, Cheng Kam Shui and the four Masters to export unmanifested, marked diesel oil from Hong Kong. The four Masters said that they had been recruited to the conspiracy by Cheng Kam Shui, whom they knew by the nickname ‘Lack Chai’, in Ao Tou in the Mainland. At his direction they loaded marked diesel oil onto the vessels under their command from one or other of three oil barges, namely Chi Shing, Chi Shing 18 and Chi Shing 28. The three barges were moored at Pak Shek Kok in Hong Kong. The ultimate object of the conspiracy was to effect the importation of that oil into the Mainland, where it was removed from the vessels. Corporate information 9.The three oil barges were owned by Super Success (HK) Limited (“Super Success”, Right Kit Limited (“Right Kit”) and Chi Shing Development (HK) Limited (“Chi Shing HK”) respectively, each of which company was incorporated in Hong Kong and of which the 2nd and 3rd applicants were their directors. The three oil barges were leased by Chi Shing Development Limited (“Chi Shing”). The 2nd and 3rd applicants held equal holdings of all of the issued shares of Chi Shing and were its directors, whilst the 1st and 2nd applicants were the only two signatories of its bank accounts. Chi Shing’s registered address was at Flat 1, 10/Floor, Mei Fung Court, Aberdeen Centre, 7 Nam Ning Street, Aberdeen (“Mei Fung Court”) and from June 2007 its business address, and those of Super Success, Right Kit and Chi Shing HK was at Flat 2, 21/Floor, Goodview Centre, 12 Wu Pak Street, Aberdeen (“Goodview Centre”). The four Masters 10.The four Masters had been detained by the Mainland authorities on 31 January 2010. Thereafter, in April 2010, on their pleas of guilty they were convicted of offences in relation to the import of the diesel oil into the PRC and sentenced variously to 12 or 13 years’ imprisonment. However, beginning in May 2012, pursuant to a Letter of Request issued by the High Court of Hong Kong and on the direction of the Supreme Court of the People’s Republic of China the four Masters gave evidence in the Shenzhen Intermediate People’s Court before Judge Zeng and District Court Judge Geiser, sitting as a Commissioner. In due course, the transcript of their evidence, and the exhibits that they produced, was remitted to the Registrar of the High Court in Hong Kong and admitted into evidence by the judge in the trial of the applicants in Hong Kong.[1] VCS 11.The Voluntary Control Scheme (“VCS”) implemented by the Customs and Excise Department involved a system of reporting the sale of marked oil, first by the major oil suppliers such as Shell and second, by the companies operating oil barges who onsold the marked oil to vessels. The purpose of the scheme was to combat the illegal use of marked oil, including smuggling it out of Hong Kong as unmanifested cargo and into the Mainland. The three Chi Shing marked oil barges were registered participants and provided the Customs and Excise with details of the purchase and sales of marked oil. That information was provided on documents relating to individual barges which were faxed by Chi Shing on a regular basis to the Customs and Excise Department. 12.In consequence of concerns arising from an increase in the sales of marked oil, the Customs and Excise Department issued a general circular dated 21 January 2009 to the owners and persons-in-charge of oil barges, advising them that the Department had found :
The owners and persons-in-charge were enjoined to be “..alert to stay away from suspicious transactions”.[2] 13.At a meeting on 9 April 2009 with Customs and Excise Officer Lo Wing Nin, the 3rd applicant had signed that general circular, and another circular setting out the purpose of the scheme, acknowledging that he understood its contents. White and yellow Chi Shing invoices 14.On 3 May 2010, officers of the Customs and Excise Department conducted searches of Chi Shing’s registered address at Mei Fung Court, and its business address at Goodview Centre. Mei Fung Court 15.On 3 May 2010, in the presence of the 2nd and 3rd applicants a large volume of white invoices in Chi Shing’s name for each of the three Chi Shing barges were seized at the Mei Fung Court address. They encompassed the period January to March 2009[3] and July 2009 to January 2010.[4] Goodview Centre 16.On 3 May 2010, a large volume of yellow invoices in Chi Shing’s name, together with completed VCS forms, for each of the three Chi Shing barges for the period June 2009 to January 2010 were seized at the Goodview Centre address.[5] The VCS forms matched those for that period that had been received by fax at the Customs & Excise Department.[6] Also, seized at the premises were white Chi Shing invoices and related Daily Sales Transaction Summaries for the 3 Chi Shing barges for the month of April 2010.[7] Partially completed VCS forms were found in a tray next to a fax machine. 17.The sales described in the yellow invoices supported the returns made in the VCS forms for that same period of time, whereas those described in the white invoices for the same date and barge were completely different and bore different invoice numbers. Although the aggregate overall sales described in the two sets of invoices were broadly similar, the number of yellow invoices was about double that of the number of white invoices and the individual sales described in the yellow invoices were in respect of sales of about half the volume of those described in the white invoices. Although there were yellow invoices for the time period prior to that stipulated in the Particulars of Offence of Charge 1, there were none found for the period after the arrest of Cheng Kam Shui and the four Masters, namely 31 January 2010. Also, in the months following the latter date there was a collapse in the aggregate volume of marked diesel oil sales by the three Chi Shing barges. The prosecution said that the inference to be drawn was that the arrest of Cheng Kam Shui and the four Masters brought the smuggling to an abrupt end and that, as a result, there was no longer a need to make false yellow invoices to support the false VCS forms faxed previously to the Customs & Excise Department. 18.It was the prosecution case that the yellow invoices were false and prepared to support the false individual sales described in the VCS forms faxed to the Customs and Excise Department and that the 1st to 4th applicant were a party to that enterprise. In support of that submission, the prosecution pointed to the evidence of Mr Tse Chi Yan and Ms Kitty Law of Union Accountancy Services, who provided bookkeeping and auditing services respectively to Chi Shing. Mr Tse said that the invoices provided to him by Chi Shing in respect of sales were white Chi Shing invoices.[8] Prior to being shown them by officers of Customs & Excise he had never seen a VCS form or the attached yellow invoices.[9] Ms Law said that she inputted into the computer information from white Chi Shing invoices.[10] White Chi Shing invoice signed by Feng Jiu : 28 November 2009 19.A white Chi Shing invoice dated 28 November 2009 was identified by Feng Jiu, one of the four Masters, as bearing his signature. The invoice bore the number 65067 and was in respect of the sale of 120,800 litres of marked oil. However, the Daily Sales Transaction Summary for the vessel Chi Shing to which it was attached, whilst describing that sale and the other sales evidenced by attached invoices for 28 November 2009, described it as a sale reflected in respect of an invoice which bore the number 82224.[11] No other white Chi Shing invoices bore the prefix of ‘6’.[12] ‘Lack Chai’ notebook 20.The prosecution pointed to the discovery on 3 May 2010 in the master bedroom of the 1st and 2nd applicants at their Bel-Air flat of a notebook bearing the nickname of Cheng Kam Shui, namely ‘Lack Chai’, as evidencing a connection between them, Chi Shing and Cheng Kam Shui in the smuggling of marked diesel oil out of Hong Kong and into the Mainland. 21.The notebook records transactions that had occurred on five days in January 2010, namely 25 to 29 and 31 January 2010. It was the prosecution case that those were sales of marked oil to vessels identified by a number code. The record is in the nature of a running account in which money is described as “Owing”, “Received”, “Remaining only” and “Remaining balance”. Many payments are described as being made in Renminbi. All the sales were of huge volume, varying from 97,700 to 170,800 litres. On some occasions sales of identical amounts were described as having been made to the same vessel on two occasions per day. Entries in respect of two dates relate to the sale of two consignments of 120,800 litres. The prosecution said that was consistent with the evidence of Feng Jiu, one of the four Masters, who testified that on occasions he would make a return journey to Hong Kong immediately on delivery of a consignment of marked oil to the Mainland. That was the amount of marked oil described as sold in the white Chi Shing invoice dated 28 November 2009 which bore his signature. Chi Shing bank accounts: 1st and 2nd applicants 22.There was no dispute that in the period 31 May 2009 to 1 February 2010 a total of $2,623,226,783 was deposited into the accounts in the name of Chi Shing with the Bank of China and HSBC, of which accounts the 1st and 2nd applicants were the only signatories. All of the applicants were contributors to some of those deposits.[13] The 3rd applicant 23.There was no dispute that in the period 31 May 2009 to 1 February 2010 a total of $117,836,926 was deposited into an account in the name of the 3rd applicant with the Bank of China. (Charge 3) Of those monies, $69.9 million was received by way of transfer deposits from Remittance Agents and Money Changers and $46.1 million by other transfer deposits.[14] In the same period he deposited over $121 million into the two bank accounts of Chi Shing. The 4th applicant 24.The 4th applicant was arrested on the morning of 3 May 2010 at the premises of Chi Shing at the Goodview Centre. At that time and place a large volume of completed VCS forms and attached yellow invoices were seized. It was an admitted fact that the 4th applicant was employed as a clerk by Chi Shing. Having been taken back to his home at Flat H, 19/Floor, Block 5, Uptown Plaza a Sony notebook computer was seized, from which was recovered two Excel files of data relating to sales by Chi Shing in November 2009. The data matched that contained on white invoices and Daily Sales Transaction Summaries for Chi Shing 18, which records had been seized on 3 May 2010 at the Mei Fung Court address of Chi Shing.[15] The prosecution said that it was to be inferred that the 4th applicant was involved in the preparation of accounting records of the sale of marked oil by Chi Shing. 25.It was an agreed fact that in the period 12 June 2009 to 31 January 2010 the 4th applicant made 100 cash deposits into the accounts of Chi Shing with HSBC to a total of $103,802,315.[16] (Charge 5) The 5th applicant 26.The prosecution case against the 5th applicant was that she played an important role in assisting her husband, Cheng Kam Shui, who was based in the Mainland. She did so by receiving deposits of money into her bank account from remittance agents, which monies she then deposited into the bank accounts of Chi Shing. It was an agreed fact that two bank accounts in the name of the 5th applicant, one with Bank of China and the other with the Hang Seng Bank, received deposits to a total of $46,101,014 in the period 31 May 2009 to 1 February 2010.[17] (Charge 4) The overwhelming majority of those deposits were made by Remittance Agents and Money Changers. In the same period, the 5th applicant deposited $45,761,871 in the account of Chi Shing.[18] 27.Of the 5th applicant’s knowledge of the circumstances and her participation in the conspiracy the subject of Charge 1, and in the related offence the subject of Charge 4, they pointed to the fact that in the period stipulated in the Particulars of Offence in Charge 1 the monies that she deposited into the account of Chi Shing increased by a multiple of 4.2 over the previous level of such deposits. Also, the prosecution relied on the testimony of Chen Ruihong, who said that he had met the 5th applicant in Hong Kong sometimes in the company of Cheng Kam Shui, and that in conversation with the 5th applicant she had made it clear to him that she was aware that he was involved in smuggling marked oil and had assisted him by providing food for some voyages. Charges 2 to 8 28.It was the prosecution case in respect of the various and different charges of ‘money laundering’ faced by the respective applicants that they knew or had reasonable grounds to believe that the monies were the proceeds of an indictable offence. The defence case 29.None of the applicants availed themselves of the right to give evidence at trial. However, Mr Lai Kam Wing was called to give expert evidence of the operation of the marked oil business in Hong Kong and the fishing industry in the case of the 1st and 2nd applicants. At trial, the other applicants adopted his testimony. 30.Of the cases of the applicants advanced in cross-examination and submissions, together with the testimony of Mr Lai Kam Wing, the judge noted :[19]
31.Of the defence case, insofar as it was articulated in cross-examination of the four Masters, the judge said :[20]
Grounds of Appeal against Conviction 32.Grounds of Appeal against conviction that are common to the applicants are advanced on their behalf. Broadly speaking, they concern three issues. First, it was submitted that the judge erred in determining in his Reasons for Verdict that by operation of section 94A of the Criminal Procedure Ordinance (“CPO”) it was not necessary for the prosecution to prove in Charge 1, “that there was no manifest”.[21] Secondly, that the judge had erred in ruling admissible into evidence in the trial in Hong Kong the testimony of the four Masters, pursuant to section 77F(1) of the Evidence Ordinance, Cap. 8, given the undisputed fact that not all of the material potentially relevant to their testimony had been made available to the defence prior to their testimony.[22] In particular, it was submitted that the refusal of the Mainland authorities to make available to the prosecution, the Court and the defence all previous statements of the four Masters to the authorities in the Mainland made the trial of the applicants unfair in that their right to a fair trial was breached. Thirdly, that the judge erred in relying on the evidence of Mr Cheung Yuk Lam, called by the prosecution as an expert forensic accountant. I. Section 94A of the CPO 33.It was contended on behalf of the applicants that the judge erred in relying upon section 94A of the CPO to convict the applicants because that provision “is not applicable to the offence of conspiracy”. 34.It was said that the judge clearly did rely on that provision as is evidenced by his statements in his Reasons for Verdict :[23]
35.Mr Blanchflower SC on behalf of the 1st and 2nd applicants submitted that the judge was in error to state that counsel for the 1st to 4th applicants had suggested that it was incumbent upon the prosecution to establish that there was no manifest on board the four vessels when oil was exported. He, and counsel for the 3rd and 4th defendants at trial, did not do so. Rather, in written and oral closing submission he had submitted that there was an absence of evidence from the prosecution about manifests or an agreement to export unmanifested oil. Those submissions had been adopted by counsel for the other applicants. 36.In support of his submissions that the judge’s determination was an error of law, Mr Blanchflower drew the attention of this Court to the observations of Lord Woolf NPJ in the judgment of the Court of Final Appeal in HKSAR v Lam Yuk Fai.[24] In that case, the appellant had been convicted of conspiracy to transfer diplomatic passport to other persons without reasonable excuse, contrary to section 42(2)(a)(ii) of the Immigration Ordinance. As Lord Woolf NPJ noted, the judge directed the jury in these terms :[25]
37.Of the effect of the judge’s direction Lord Woolf NPJ said :
38.In the result, the Lord Woolf NPJ concluded :[26]
39.Mr Blanchflower invited the Court to note that, in the context of the offence of failing to comply with a notice issued under section 14(1) of the Prevention of Bribery Ordinance, Cap. 201, the statements of Lord Woolf NPJ had been cited with approval in the judgment of Ribeiro PJ in HKSAR v Ng Po On.[27] Similarly, in the judgment of this Court delivered by Yeung VP in HKSAR v Yung Lai Lai[28]it was determined that section 118(3) of the Copyright Ordinance, Cap. 528, which places a burden on the defendant to prove that he did not know and had no reason to believe that the copy in question was an infringing copy of copyright work, could not be relied upon in the inchoate offence of conspiracy to sell infringing copies. The proviso 40.Mr Blanchflower submitted that a consideration of the application of the proviso did not come into play because the judge’s error of placing a reverse onus on a defendant in a conspiracy charge was a fundamental error. In support of that submission, Mr Blanchflower drew the Court’s attention to the statement of Lord Woolf NPJ in Lam Yuk Fai :[29]
Mr McCoy SC, for the 3rd and 4th applicants, and Mr Donald, for the 5th applicant, supported those submissions. II. The admission of evidence pursuant to section 77F(1) of the Evidence Ordinance The prosecution failure to ascertain and disclose unused material-unfairness 41.Mr Blanchflower submitted that the judge was in error in admitting the evidence of the four Masters obtained pursuant to the letter of request, given that the prosecution had failed to ascertain the nature and extent of the undisclosed material and obtain that material for disclosure to the defence. The “investigative prosecuting and judicial authorities” of the People’s Republic of China had failed to disclose that material. In consequence, the prosecution had failed to discharge the duty of disclosure imposed on the prosecution. Accordingly, the right of the 1st and 2nd applicants to a fair trial was breached. No unfairness likely to occur 42.Furthermore, he submitted that the judge had erred in determining, pursuant to section 77F(1)(d)(iii) of the Evidence Ordinance, Cap. 8, that “no unfairness was likely to occur in those proceedings” consequent upon the evidence taken in the Mainland being admitted into evidence in the proceedings in Hong Kong.[30] Although the defence had been provided with the statements of the four Masters made to the Mainland authorities on 25 February and to the Hong Kong authorities on 25 March 2010, there was no dispute that the parties, and the Court itself, had not been provided with all of the disclosable unused material relating to the four Mainland Masters. There was no dispute that they had made many other statements before and after those dates. As a result, the defence was deprived of the full opportunity of demonstrating the unreliability and incredibility of those witnesses. 43.Mr McCoy submitted that, given that the undisclosed material related to four immunised accomplice witnesses, no judge could be satisfied that no unfairness was likely to occur in consequence of their testimony being admitted into evidence at the trial. No unfairness : flawed and inadequate reasons 44.Mr Blanchflower and Mr McCoy submitted that, in ruling the evidence of the four Mainland Masters and related exhibits admissible in the trial in Hong Kong, the judge had taken into account “irrelevant matters and/or matters unsupported by evidence”. Furthermore, it was contended that he had provided inadequate reasons for his determination that he was satisfied that no unfairness would result to the defence. Credibility and reliability of the four Masters 45.Next it was submitted that the judge had failed to consider and evaluate matters relevant to his determination as to the credibility and reliability of the erred four Masters and, in consequence, had erred in finding that they were credible and reliable witnesses. He failed to have proper regard to the fact that they had lied in the accounts that they had given to the Mainland investigating authorities, to the Mainland courts and in the commission proceedings. III. The judge’s reliance on the prosecution’s forensic accountant’s evidence 46.It was submitted that the judge erred in relying on Mr Cheung Yuk Lam, the prosecution forensic accountant, given that he had no experience in or knowledge of either oil trading or the fishing industry, whose opinions were based on incomplete evidence. 47.Then, it was contended the existence and use of white and yellow invoices by Chi Shing was not proof of the conspiracy alleged in Charge 1. Similarly, it was submitted that evidence that the applicants permitted their personal accounts to be used to receive and make payments for Chi Shing’s business was not evidence in proof of the conspiracy or of their involvement thereto. Next, it was said that Mr Cheung’s observations as to the rise in sales of marked oil at a time when there was a fishing moratorium were irrelevant since the moratorium which began on 16 May had ended on 1 August 2009, before any of the four fishing vessels conned by the four Masters began their smuggling voyages. Also, it was contended that Mr Cheung did not have regard to all the relevant evidence, in particular the ambit of the moratorium and its effect on other marked oil suppliers. 48.Then, it was submitted that the judge erred in relying on Mr Cheung’s evidence that the total amount deposited into Chi Shing’s bank account was $228 million in excess of sales of marked oil over the same period. That was factually wrong. 49.Further, it was contended that the judge erred in having regard to the disparity between the personal wealth of the 1st and 2nd applicants, having regard to their modest salaries and the annual profits of Chi Shing in the period 2007-2009. 50.Finally, it was submitted that the judge erred in having regard to the fall in the sale of oil by Chi Shing in the period immediately following the arrests of the co-conspirators, beginning on 31 January 2010. Not all the relevant evidence had been considered, including the fact that : the period encompassed the Lunar New Year holidays; the 3 Chi Shing underwent maintenance and no comparison was made with the sales of other oil traders. IV. Other grounds of appeal Charge 1 51.Praying-in-aid the matters canvassed earlier, it was submitted on behalf of all of the applicants that there was insufficient evidence to support a conviction in respect of the conspiracy alleged in Charge 1 or the participation of the respective applicants in that conspiracy. 52.Further, Mr Blanchflower submitted that the judge erred in placing reliance on the ‘Lack Chai’ notebook[31], which had been found at the home of the 1st and 2nd applicants on 3 May 2010, and the fact that one of the four Masters, Feng Jiu, had signed a white Chi Shing invoice dated 28 November 2009 for 120,800 litres of marked oil, for which $500,000 was payable,[32] and which had been seized at the Mei Fung Court office of Chi Shing on 3 May 2010. There was no evidence that the notebook related to Charge 1. It could have been a sale to another vessel belonging to Cheng Kam Shui. The invoice only proved the sale on one occasion of marked oil to one of the four Masters. It did not prove the existence of a conspiracy. Charge 2-6 53.On the basis that the judge erred in convicting the applicants of the conspiracy averred in Charge 1, it was contended that it followed that he was in error in convicting them of the individual charges which they faced of dealing in monies that had their provenance in the sale of marked oil, respectively Charge 2 - 1st and 2nd applicants; Charge 3 - 3rd applicant; Charge 4 - 5th applicant; and Charge 5 - 4th applicant. The judge erred in finding that they ‘knew’ that the monies, with which they dealt, were the proceeds of an indictable offence. The 5th applicant 54.In addition, it was submitted on behalf of the 5th applicant that the judge had failed to give weight to the fact that the 5th applicant, the wife of Cheng Kam Shui, had assisted her husband in running their own fishing boats throughout the period, namely before, during and after that alleged in Charge 1. Her role was to receive payments from remittance agents and to deposit cash into the bank account of Chi Shing as payment for marked fuel used on those vessels. Further, the judge had failed to give adequate reasons for his findings. Finally, it was contended that the judge was wrong to rely on the evidence of Chen Ruihong of the 5th applicant’s knowledge of his role in smuggling and of her assistance to him.[33] Charges 6 and 7 (3 May 2010) 55.It was submitted on behalf of the 1st and 2nd applicants (Charge 6) and the 3rd applicant (Charge 7) that the judge erred in convicting the applicants of the respective charges. The Court was asked to note that Charges 6 and 7 alleged offences of dealing in the proceeds of an indictable offence on 3 May 2010, whereas the conspiracy alleged in Charge 1 had come to an end on 1 February 2010. The prosecution alleged that the impugned monies dealt with on 3 May 2010 came from the commission of that offence. Then, it was pointed out that Chi Shing had continued its business of selling marked oil in the period of three months before the date of the offence. Notwithstanding a sharp drop in the volume of sales of oil in those months, compared with the period of the conspiracy, nevertheless hundreds of millions of dollars of sales were generated in those three months and the pattern of depositing large amounts of money in cash with the bank continued. The monies the subject of these charges could have had those legitimate sources as their provenance. 56.Finally, it was submitted that in convicting these applicants of these charges the judge had failed to give adequate reasons, in particular to address the issues raised on their behalf in submissions. The Respondent’s Submissions Section 94A of the CPO 57.On behalf of the respondent Mr Robert Lee SC submitted first that the judge’s reference to section 94A of the CPO was merely “a comment”. He pointed out that that is how the judge had addressed the issue at the outset. It was not to be taken as contradicting the statement he had made immediately before as to the ingredients of the offence, namely :[34]
58.It was submitted that the judge’s subsequent analysis in respect of the evidence relevant to the 1stto 5thapplicants in relation to Charge 1 was consistent with that direction.[35] No reference was made to the presence or absence of manifests. 59.Alternatively, it was contended by the respondent that section 18 of the I & E Ordinance is to be construed as creating an offence with an exception/exemption. It was suggested that the section created an offence of exporting cargo. The exception/exemption to the commission of the offence was the preparation and use of a manifest. It was acknowledged that this construction of the offence created by section 18 had not been advanced in the lower court. 60.Thirdly, it was contended that there was cogent evidence[36] from which an irresistible inference was to be drawn that no manifests had been prepared by the four Mainland Masters, so that in any event the proviso was clearly applicable. The admission of evidence pursuant to section 77F(1) of the Evidence Ordinance Disclosure 61.This Court was invited to accept as applicable to Hong Kong the principles in respect of disclosure identified in the judgment of the Court of Appeal of England and Wales in R v Flook[37]. There is not an absolute obligation on the prosecution to disclose relevant material held outside the jurisdiction by those not subject to the jurisdiction of the Court. The obligation is to take reasonable steps to ascertain and obtain relevant unused material.[38] 62.The respondent submitted that the prosecution had discharged its duty of disclosure, in that it had taken reasonable steps to ascertain and obtain the unused material in the hands of the Mainland authorities, as evidenced by the Customs and Excise Department’s letter of 11 April 2012 to the Guangdong Sub-Administration Anti-Smuggling Bureau, in which they asked to be provided with a wide range of information and documentation including all statements made by the four Masters. No unfairness likely 63.The respondent submitted that the key issue relevant to a determination of the admissibility of the evidence taken from the four Masters was a consideration of whether the unavailable undisclosed material held by the Mainland authorities was materially relevant to an issue in the trial such as to render a fair trial impossible. That is an issue of fact to be decided in the specific circumstances of the case. Here, it was not known what might be contained in the unavailable undisclosed material. The Court was invited to note that in HKSAR v Cheung Wai[39] this Court concluded that the unavailability of a bank security videotape, which had been sought by the defence only eight days before trial, the contents of which were not known because the tape had been destroyed as was the practice after 3 months, did not deprive the applicant of a fair trial. 64.It was submitted on behalf of the respondents that the only relevance of the unavailable undisclosed statements of the four Masters was in respect of their credibility. In that context, the Court was asked to note that the four Masters had been cross-examined at length and had given evidence in total over a period of eight days. Their respective statements of 25 February and 25 March 2010 had been used extensively in cross-examination of them. Further, it was to be noted that none of the four Masters gave direct evidence adverse to the 1st to 4th applicants. Only Chen Ruihong gave evidence adverse to the 5th applicant. 65.Finally, it was submitted that the judge was clearly alive to the considerations relevant to the precondition provided by section 77F(1)(d), namely that he was required to be satisfied that no unfairness was likely to occur in the proceedings in consequence of admitting the testimony of the four Masters. He was entitled to rule the evidence admissible. The judge’s reliance on the prosecution’s forensic accountant evidence 66.It was contended on behalf of the respondent that no expert evidence was required to analyse, compare and contrast the data recorded on the white and yellow Chi Shing Chi Shing invoices, together with the VCS forms. The available material was sufficiently complete to permit that comparison. That exercise by itself permitted the drawing of compelling inferences adverse to the applicants. 67.Of the evidence of the mixing of monies between the respective accounts of the applicants and the accounts of Chi Shing, it was contended that its relevance lay in the evidence of Mr Cheung that it was imprudent commercially and unnecessary since the monies could have been remitted directly to the accounts of Chi Shing. Also, it was to be noted that there was a net flow of funds in the period 1 June 2009 and 31 January 2010 in favour of the 1st and 3rd applicants, respectively of $19 million and $9.1 million. 68.It was submitted that the increase in sales of oil by Chi Shing in the period 1 June 2009 and 31 January 2010 was relevant, in particular given the fact that a fishing moratorium was in place from 16 May to 1 August 2009. Further, the sharp decrease in sales in February 2010 by 75%, coinciding with the arrest of Cheng Kam Shui, was an indication of the significance of his smuggling to the sales of Chi Shing. 69.It was contended that the relevance of the modest salaries of the 1st to 4th applicants lay in the fact of the acquisition of assets by the 1st to 3rd applicants and the deposit of monies into the bank account of the 4th applicant. Finally, it was submitted that the significance of an excess of deposits into Chi Shing’s bank accounts over sales of oil in the period 1 January 2009 to 3 May 2010 lay in the absence of any explanation in the Chi Shing Ledger for any source of income other than from the sale of oil. The judge’s determination of the credibility and reliability of the four Masters 70.Mr Lee submitted that the judge made clear in his Reasons for Verdict that he was alive to the fact that the four Masters were accomplices, whose evidence he recognised required to be scrutinised “both critically and thoroughly”. The judge acknowledged their possible motive of securing an early release from prison and the fact that there were inconsistencies between their out-of-court statements and their oral testimony. Further, he noted that Fung Jiu and Chen Ruihong admitted that they had lied whilst at an early stage Huang Shunping and Shi Rubin were reluctant to disclose information to the Mainland authorities. The judge was entitled to accept their testimony, as he did. A CONSIDERATION OF THE SUBMISSIONS The admission of evidence pursuant to section 77F(1) of the Evidence Ordinance Letter of Request 71.In consequence of an ex parte originating summons, filed on 24 December 2010, the Secretary of Justice obtained an order from Pang J, filed on 6 January 2011 with the High Court, that a Letter of Request be issued to the Supreme Court of the People’s Republic of China for assistance in obtaining evidence in this case. The order sought the examination of the four Masters and stipulated that the evidence to be obtained from each of them :
Provision was made in the order for the appointment of a District Court judge to assist in the examination of the witnesses. Evidence taken on commission 72.By order of the Supreme Court of the People’s Republic of China effect was given to the letter of request and evidence was taken from the four Masters at the Shenzhen Intermediate People’s Court before Judge Zeng and Mr Commissioner Geiser on various dates on and between 14 and 18 May and 6 and 9 August 2012. Mr Luk SC conducted examination on behalf of the HKSAR, whereas cross-examination of the witnesses was conducted by counsel for the applicants, respectively Mr Blanchflower for the 1st and 2nd applicants, Mr Delaney for the 3rd and 4th applicants and Mr Donald for the 5th applicant. Disclosure by the prosecution 73.The statements taken from the four Masters by the Mainland authorities on 25 February 2010 were provided to the defence by a letter dated 2 March 2012 from the Customs and Excise Department to solicitors representing the applicants. That was more than 2 months in advance of the hearing in the Shenzhen Intermediate People’s Court. Defence requests for unused material relevant to the four Masters and the response of the prosecution 74.At the oral hearing in this Court, although the Court repeatedly requested the parties to be provided with a complete account of the requests made by the applicants for disclosure of unused material and the responses of the respondent, together with correspondence and/or other relevant documentary records our request was not met in full. Following the oral hearing the Court invited the parties to comply with this request and was provided with more information and supporting documentation. 7 June 2011 75.The first request for disclosure of material to the defence was made on behalf of the 1st to 4th applicants of the prosecution by a letter from Littlewoods dated 7 June 2011. Comprehensive and detailed requests for disclosure were made in respect of material in relation to Cheng Kam Shui and the four Masters. 15 August 2011 76.By a letter dated 15 August 2011 to the Anti-Smuggling Bureau of the Guangdong Sub-Administration General Administration of Customs, the Customs and Excise Department detailed the information they said that they had obtained from the latter in the course of their mutual investigation and asked to be advised, “whether the above information can be disclosed to the Defence”. The letter stated that counsel for the defence had written to the Department of Justice requesting disclosure by them of all information obtained in the course of investigations relating to the four Masters and Cheng Kam Shui. The information described as having been obtained in that exchange included written records of examinations of Chung To Yee, Cheng Kam Shui and Jiang Yan Qiong, but not in respect of any of the four Masters. 17 August 2011 77.By a letter dated 17 August 2011 to the Customs and Excise Department, the Anti-Smuggling Bureau of the Guangdong Sub-Administration General Administration of Customs replied confirming the exchange of information as described in the earlier letter and replying to the request for consent for disclosure to the defence :
7 December 2011 78.By a letter to the Department of Justice, dated 7 December 2011, Littlewoods repeated their requests for disclosure set out in their letter of 7 June 2011, including that made in respect of Cheng Kam Shui and the four Masters. 6 January 2012 79.By a letter to the Department of Justice, dated 6 January 2012, Littlewoods complained that they had received no reply to their requests of 7 June and 7 December 2011. Further, they asked for specific details to be provided of the steps taken by the Department of Justice “to obtain the requested information or material from the relevant Mainland authorities”. 13 January 2012 - hearing in the District Court 80.At a hearing before District Court Judge Anthea Pang, as she was then, the prosecution informed the Court that disclosure would be made to the defence the next day or soon thereafter of material obtained from the Mainland authorities. Mr Blanchflower informed the Court that the defence request for disclosure encompassed not only material in the possession of the prosecution but also material in the possession of the Mainland authorities, which the prosecution were requested to ascertain and obtain. 7 February 2012 81.By letter to the Department of Justice, dated 7 February 2012, Littlewoods complained that disclosure had not been made of the material requested of the prosecution in their letters of 7 June, 7 December 2011 and 6 January 2012, notwithstanding the statement of the prosecution at the hearing in the District Court of 13 January 2012 that the material would be disclosed in the near future. 2 March 2012 - disclosure 82.By a letter, dated 2 March 2012, from the Customs and Excise Department to solicitors representing the applicants[40], unused material was served on the applicants. Included in that material, were the statements of the four Masters dated 25 February 2010, together with their consents to give evidence dated 19 April 2010. Also provided were no fewer than 10 statements of Cheng Kam Shui, of which seven were taken in February, beginning 4 February, and three in March 2010, ending 6 March 2010, and his statement dated 25 March 2010. The bulk of that material was described as having been provided by the Anti-Smuggling Bureau of Shenzhen Customs in March 2010. 83.No doubt in response to the request made in Littlewoods’ letter of 6 January 2012 for details of all actions taken to obtain “the requested information or material from the relevant Mainland authorities”, the letter set out a descriptive chronology of what was described as :
84.In summary, using the acronyms used in the text, it was asserted that :
16 March 2012 85.By a letter dated 16 March 2012 Littlewoods, acting for the 1st to 4th applicants, wrote to the Department of Justice asserting that the prosecution had failed to discharge its duty of disclosure, including unused material. It was noted that repeated requests for disclosure of that material had been made on 7 June and 7 December 2011, 6 January 2012 and 8 March 2012. Obviously quoting from the request for disclosure of material in the letter dated 7 June 2011, it was asserted that disclosable requested material had not been disclosed, namely :
11 April 2012 86.In a letter dated 11 April 2012, the Customs and Excise Department asked the Guangdong Sub-Administration Anti-Smuggling Bureau to provide a wide range of information, including statements and documentation, in respect of the treatment of the four Masters and Cheng Kam Shui by the Mainland authorities following their arrests. It was noted that the defence sought the provision of the material on the basis that it was needed on the “principle of fair trial”. The material requested was :[42]
25 April 2012 87.By a letter, dated 25 April 2012, the Guangdong Sub-Administration Anti-Smuggling Bureau advised the Customs and Excise Department :[43]
26 April 2012 88.By a letter, dated 26 April 2012, the Department of Justice replied to Littlewoods letter of 16 March 2012, asserting that further unused material had been served on Littlewoods on 24 April 2012 and on the 5th applicant on 23 April 2012. In response to Littlewoods letter of 16 March 2012, it was asserted that :
27 April and 4 May 2012 - Pre-trial reviews 89.Pre-trial reviews were conducted by Judge Geiser on 27 April and 4 May 2012 in which the issues of disclosure of unused material were addressed. 27 April 2012 90.In the course of the pre-trial review conducted by Judge Geiser, Mr Blanchflower complained that “it would appear that the attitude of the prosecution is that that if they have in possession, it will be disclosed if they don’t have it in possession, it will not be disclosed.” In the context of that assertion, he submitted that :[44]
91.In the context of the letter, dated 25 April 2012, from the Guangdong Sub-Administration Anti-Smuggling Bureau advising the Customs and Excise Department of their negative response to the request for disclosure of material set out in their letter of 11 April 2012 and the reasons provided to explain that decision Mr Luk noted, “if we accept what they say in this letter, then it seems that according to their law, they will not provide those documents that we require.”[45] Nevertheless, Mr Luk undertook to make further enquiries, “all we can do is to try our best to make requests to the PRC side and if they refuse, I’m afraid there is nothing we can further do.”[46] 4 May 2012 92.On 4 May 2012, Mr Luk confirmed that all disclosable material in the possession of the prosecution, including that obtained from the various Mainland authorities, had been disclosed to the defence :[47]
9 May 2012 93.On 9 May 2012, at the Shenzhen Intermediate People’s Court, at a meeting attended by counsel but not the Commissioner, Judge Geiser, the requests of 11 April 2012 were repeated to Senior Judge Qui and Judge Zeng and a copy of the letter of 11 April 2012 of the Customs and Excise Department and a translation provided to the judges.[48] 94.A letter to Littlewoods, dated 13 July 2012, from the Department of Justice addressed the circumstances of that meeting in some detail. Of the request for the provision of previous statements of the four Masters, it was asserted that Vice President Yau (Qiu), of the Shenzhen Intermediate People’s Court, had said :
95.Then, it was asserted that in the face of a renewed request for that material the “Vice President intimated that the documents……. were in the storage and he would seek instruction whether those documents could be provided to you.” Further, the Vice President was described as having provided the defence with “the judgment and the charge sheet of the PRC case which involved all the four PRC witnesses” and having informed them that “…only CHENG Kam Shiu in his appeal was legally represented, the other four PRC witnesses did not have a lawyer at trial and their cases have been settled.” 14 May 2012 96.At the hearing on 14 May 2012, Mr Delaney, counsel for the 3rd and 4th applicants, asked Judge Zeng to request all the four Masters to consent to the release to the defence of all their statements. Judge Zeng said that on an earlier occasion a negative response has been given to the requests.[49] 6 August 2012 97.At the hearingat the Shenzhen Intermediate People’s Court of 6 August 2012, a request was made on behalf of the 1st to 4th applicants to the Court for the disclosure of the particulars of the lawyers acting on behalf of the four Masters. 8 August 2012 98.Finally, a written request was made at the Shenzhen Intermediate People’s Court on 8 August 2012 for the disclosure of one of the witness statements of Huang Shunping, one of the four Masters, made prior to 25 February 2010. On 6 August 2010, in the course of cross-examination on behalf of the 3rd and 4th applicants, he testified that in a statement made prior to 25 February 2010 he had mentioned having made payment for obtaining diesel oil and he gave his permission that it be disclosed to the defence.[50] 99.No reply was received to the requests of 6 and 8 August 2012. Objection to the admission at the trial of the evidence of the four Masters 100.Counsel for the applicants informed the judge, sitting as a Commissioner in the proceedings in the Shenzhen Intermediate People’s Court, that objection would be taken to the admission of the evidence in the trial in Hong Kong. 101.In due course, on the penultimate day of evidence adduced in the prosecution case, objection was taken on behalf of the applicants[51] to the admission into evidence at the trial in Hong Kong of that evidence, referred to in the Certificate of the Registrar of the High Court dated 21 September 2012, issued pursuant to section 77F(5) of the Evidence Ordinance.[52] Broadly, the grounds advanced before the judge of those that are advanced in this Court. The trial : admission of the evidence taken pursuant to the letter of request Ruling 102.The judge ruled the evidence admissible.[53] In doing so, he adverted to the provisions of section 77F(1)(d) of the Evidence Ordinance, which provides that the Court be satisfied, having regard to the following matters :
103.Of the basis of the objection to the admission of the evidence, the judge noted of the four Masters whose evidence was in issue that :
104.The judge observed that the application was made, not as a result of any non-disclosure by the Department of Justice but as a result of the authorities in the Mainland not releasing those statements to any of the parties. He accepted that the prosecution had sought to secure material, but “..to no avail”. Having noted that the four Masters had given evidence over a period of a total of eight days, the judge said :
105.Of those circumstances, the judge said :
The out-of-court statements of the four Masters 106.There is no dispute that the extent of the volume of out-of-court statements made to the Mainland authorities, other than those made on 25 February 2010, by the four Masters was established only in cross-examination of them on behalf of the applicants. Of course, at the outset all the parties possessed the statements dated 25 March 2010 taken from the four Masters by officers of the Customs and Excise of the HKSAR. All four Masters accepted in cross-examination that there were many other written statements, made from oral interviews of them by Mainland authorities after their arrest on 31 January 2010, which they had adopted. Feng Jiu said there were “maybe seven”, although he was not clear.[54] Chen Ruihong agreed that there it “should be the case” that there were more than five such written statements.[55] Huang Shunping said that there were “as many as 10 to 20” written statements[56] and Shui Rubin said that, although he could not remember how many written statements had been made, there were many.[57] Broadly, there was common ground as to the method by which the statements had been made : questions were asked and answers made and recorded in a computer; eventually, the record was printed out and after the witness had read the statement that witness adopted it by signing or placing his fingerprint on the document.[58] The law : the ambit of the prosecution duty to disclose material to the defence 107.As Bokhary PJ observed in his judgment, with which all the other judges agreed, in the Court of Final Appeal in Hall v HKSAR[59] the “rationale, status, nature and scope of the prosecution’s duty of disclosure in Hong Kong” was addressed in the judgment of Sir Anthony Mason NPJ in HKSAR v Lee Ming Tee (No. 2).[60] In his judgment, Bokhary PJ identified the salient features of that analysis :
108.Of course, in both Hall and Lee Ming Tee the Court of Final Appeal was concerned with the duties of the prosecution in respect of the disclosure to the defence of material within Hong Kong. None of the Hong Kong cases cited to us concerned the ambit of that duty in the context of material outside this jurisdiction. In R v Flook the Court of Appeal of England and Wales addressed that issue in respect of such material located in South Africa, and therefore outside both the United Kingdom and the European Union, in which places different legal regimes obtained.[61] 109.The appellant, Flook, was convicted at trial of two counts of conspiracy to import dangerous drugs into the United Kingdom, namely 7.5 tonnes of cannabis (Count 1) and 165 kg of cocaine (Count 2). The cannabis was found in a container shipped from South Africa on an inspection of it at Felixstowe Port. The cocaine was found concealed in mirrors in a shipment destined to be shipped to the United Kingdom from South Africa. 110.After the discovery in June 2006 of the cannabis in the container, close cooperation ensued between the Metropolitan Police authorities and the South African police authorities. Surveillance was maintained of the appellant when he visited South Africa that month, including his contact with a Mr Tutton and a Mr McKinnon. In October 2006, the two police authorities made arrests : the appellant in the United Kingdom and Mr Tutton and Mr McKinnon in South Africa. In response to the service of an International Letter of Request from the Crown Prosecution Service in United Kingdom, the South African authorities provided material that had been specifically identified but, in addressing a “general sweep up” request to be provided with “any other evidence which would be of use to the investigation”, the South African authorities declined to allow Metropolitan Police officers, who were permitted to inspect that material, to copy, make notes or list that material in a schedule. That stance was taken to avoid compromising the prospective prosecution of Mr Tutton and Mr McKinnon, together with another person, in South Africa. 111.At the outset of the trial a request was made by the defence for disclosure. Although no written response was made to the request, the defence was informed orally that the South African authorities would not hand over any other papers other than those served by the Crown on the defence. 112.On the appeal, issue was taken that the prosecution had failed in its duty to disclose unused material, such that the appellant did not have a fair trial. 113.In the judgment of the Court, Thomas LJ, as he was then, noted that the prosecution’s general obligations of disclosure are provided for by the Criminal Procedure and Investigations Act, 1996 together with the Code of Practice issued thereunder and the Attorney General’s Guidelines of 2005. However, he noted that no special provision was made in relation to “material held by individuals or companies overseas or by foreign government authorities”.[62] Furthermore, he said that whilst the Crown Prosecution ‘Disclosure Manual’ addressed international disclosure issues, requiring investigators to “pursue all reasonable lines of enquiry”, that manual was only “a service level agreement between the police and the Crown Prosecution Service.”[63] 114.Notwithstanding the fact that the legislation, Code and Guidelines were expressed only in a domestic context, Thomas LJ said it was clear that :[64]
115.Nevertheless Thomas LJ went on to say :
116.There is an absence in Hong Kong of any legislation in respect of disclosure of material by the prosecution to the defence or of any related Codes or Guidelines. The Department of Justice’s ‘Statement of Prosecution Policy and Practice’ contains a chapter which addresses the ‘Duty of Disclosure’. However, it does not purport to address the disclosure of material located outside the jurisdiction. Nevertheless, the principles identified in Flook in respect of such material, namely that in such circumstances the prosecution’s duty is to “pursue reasonable lines of enquiry” to identify the material and “to take reasonable steps to obtain it” resonate with the principles in respect of disclosure identified in the judgment of Sir Anthony Mason NPJ in Lee Ming Tee (No.2). We are satisfied that those obligations apply in like manner to the prosecution in Hong Kong. Steps taken by the prosecution to identify and obtain disclosable material relevant to the four Masters 117.There is no dispute that the Customs and Excise Department were provided, inter-alia, with the statements dated 25 February 2010 of the four Masters by the Mainland authorities in March 2010, as asserted in their letter dated 2 March 2012 to the solicitors representing the applicants. However, those statements were not stipulated as being in the material in respect of which on 15 August 2011 the Customs and Excise Department sought the consent of GSCC to disclose to the defence. The statements of the four Masters dated 25 February 2010 were disclosed to the defence for the first time by the letter of the Department of Justice dated 2 March 2012. 118.It was apparent from the face of all of the statements of the four Masters dated 25 February 2011 that, as was noted by Littlewoods in their letter of 16 March 2012, earlier statements had been taken from them. Similarly, again noted by Littlewoods in that letter, that much was confirmed in respect of Feng Jiu by a reference in the penultimate question in his statement of 25 February 2010 to discrepancies between that account in respect of payments for marked oil and “previous written statements”.[65] 119.In his submissions in support of his application that the testimony of the four Masters be admitted into the trial in Hong Kong Mr Luk asserted that the “prosecution and DOJ had made several attempts to ask for previous statements, documents, notes, et cetera, to be disclosed to the Hong Kong side so we can forward that to the defence. Despite our efforts, we have failed to gain access to those documents.”[66] However, no details of such requests were provided, let alone any correspondence or attendance notes. There does not appear to have been any evidence before the judge of any such requests prior to 11 April 2012. The letter from the Customs and Excise Department dated 15 August 2011 to the Anti-Smuggling Bureau of the Guangdong Sub-Administration General Administration of Customs the Customs and Excise Department merely sought consent to disclose material already provided by the Mainland authorities to the Customs and Excise Department, it did not seek further disclosure. 120.There is no dispute that the prosecution, through the Customs and Excise Department’s letter of 11 April 2012to theGuangdong Sub-Administration Anti-Smuggling Bureau sought, to obtain for the defence a wide range of information, including documentation, in respect of the dealings with the four Masters by the Mainland authorities following their arrests. It was stated in terms in that letter that the information was sought on the principle of fair trial. 121.At the pre-trial review of 27 April 2012 the prosecution was enjoined by the judge to renew its request of the Mainland authorities for the provision of the requested material in relation to the four Masters. At the pre-trial review of 4 May 2012, Mr Luk informed the Court that the prosecution had complied with the Court’s request but said that the renewed requests to be provided with that material had met with a negative response. Again, no detail at all was provided of whom, by whom, when or how that request was made. It is unfortunate that such obviously available detail was not forthcoming. Nevertheless, it is clear that no issue was taken with the assertion. Conclusion 122.In the result, having regard to the requests made of the Mainland authorities in the letter of 11 April 2012 and the subsequent repeated requests adverted to by Mr Luk on 4 May 2012, we are satisfied that the prosecution took reasonable steps to ascertain and obtain the material in the hands of the Mainland authorities relevant to the four Masters which was disclosable to the defence. There is no dispute that the material lay beyond the powers of the Courts of Hong Kong to compel production and thereby to afford disclosure to the defence. As Thomas LJ observed in Flook, as noted earlier, in such circumstances :
The admission of the evidence of the four Masters : no unfairness likely to occur The Law 123.Obviously, the provisions of section 77F(1)(d) of the Evidence Ordinance stipulate preconditions for the admission of the evidence of the four Masters at the trial of the applicants. There is no dispute that the general rule is that the party adducing evidence has the burden to prove any necessary preconditions.[67] When the party seeking to adduce the evidence is the prosecution, the appropriate standard is beyond reasonable doubt. Although the judge did not advert to those matters, they being elementary matters of law, we have no doubt that he bore them in mind. It was not submitted otherwise. 124.With respect to Mr Blanchflower, we are not assisted by the judgment of Lord Cameron in the High Court of Justiciary in Scotland in Muirhead, Petitioner[68]. In that case the petitioner was a defendant awaiting trial for fraud. He sought the issue of a letter request to the Four Courts, Dublin seeking the taking of evidence by interrogatories from a witness. The Crown opposed the application. The application was made pursuant to the provisions of section 32 of the Criminal Justice (Scotland) Act 1980. Section 32(2) provides inter-alia that the application may be granted only if the judge is satisfied that :
125.As is readily apparent, the statutory provisions are quite different. Section 32(2) requires that the judge be satisfied “there would be no unfairness to the other party”, whereas section 77F(1)(d) of the Evidence Ordinance requires that the judge be satisfied that “no unfairness is likely to occur in the proceedings”. Clearly, it was the requirement of the former provision that led Lord Cameron to say of the statute “..it is that no unfairness will arise, not that the degree of unfairness is of relevance. Thus the obligation on an applicant is a heavy one.”[69] 126.In his written reply to the respondent’s submissions Mr Blanchflower cavils with the respondent’s assertions that the undisclosed previous written statements of the four Masters was relevant to their credibility only. However, that was the nub of the written submission he made objecting to the admission of that evidence at trial :[70]
127.We are satisfied that the potential significance of the undisclosed material relevant to the four Masters was correctly identified by Mr Blanchflower in his submission to trial. The obvious relevance of such material lay in whether or not it might undermine the credibility of the accounts given by the four Masters. The nature of the witnesses 128.That the judge was fully aware of the kind of witnesses that the four Masters were, was made clear in his Reasons for Verdict :[71]
129.Having noted that they were accomplices in the conspiracy the subject of Charge 1, the judge said that “..he scrutinised their evidence both critically and thoroughly”. 130.The judge said that the unavailability of the other statements admittedly made by the four Masters was “unfortunate”. No doubt, given the fact that submissions had been made on behalf of the applicants as to the relevance of those statements to the determination of the credibility of those witnesses, that determination was made in the context of the lost opportunity for the defence, and for that matter the Court, to have available to it all material potentially relevant to the credibility of those witnesses. Equally, he was entitled to determine that it was not appropriate to speculate as to the contents of those statements. That much was obvious. Since they were not available, their contents were not known. Similarly, he was right to say that if they did contain inconsistencies those were matters that went to “the question of weight only”. No doubt, he meant by that that an inconsistent out-of-court statement was a matter that was relevant to the determination of the credibility and reliability of the evidence of a witness in court. 131.As noted earlier, the context in which the judge considered the issue of unfairness to the applicants, arising from the lost opportunity of using the other out-of-court statements of the four Masters in cross-examination of them, was the actual cross-examination which was conducted. He was correct to take that approach. Of their testimony, he noted that they had given evidence over a total of eight days, much of which was taken up with cross-examination. The four Masters : the judge’s findings 132.As noted earlier, although the evidence of the four Masters had been taken on a total of eight days in May and August 2012 the judge was not called upon to rule on the admissibility of their evidence in the trial of the applicants until the penultimate day of the prosecution case, 22 October 2012. After the Ruling, the remaining witness called to give oral testimony for the prosecution was an Immigration officer, who spoke to the uncontroversial issue of the provenance of the photograph of Cheng Kam Shui, which had been used for purposes of identification in the testimony of the four Masters. Then, Mr Lai Kam Wing, an expert witness, was called as the only witness in the defence case. It follows that at the time at which the judge made his ruling in respect of the admissibility of the evidence of the four Masters he was very well-placed to address the requirements of section 77F(1)(d) in the context of the evidence in the proceedings. 133.The judge’s findings in respect of the inconsistencies of the accounts given by some of the four Masters in testimony in contrast to their out-of-court statements and the lies that they had told were all matters established and, in effect, accepted in the course of the testimony of the four Masters and therefore known to him at the time of his ruling. No doubt, it was with that in mind that in his ruling he referred to the length of their testimony and the ambit of cross-examination. Clearly, that was the context in which the judge considered the issue of unfairness in determining to admit the evidence. In the event, the Judge found :[72]
134.On the other hand, the judge went on to accept the explanation that they gave for having told those lies :[73]
The ambit of the evidence of the four Masters 135.Although the judge did not advert to it specifically, another matter relevant to a determination that no unfairness was likely to enure to the applicants by the admission of the testimony of the four Masters was the significance of that evidence not only to the prosecution case but also to the cases of the individual applicants. Obviously, their evidence, if accepted, established a conspiracy between Cheng Kam Shui and the individual Masters to smuggle marked oil into the Mainland and, more contentiously, a conspiracy to export unmanifested marked oil from Hong Kong. It was their evidence that they were directed by Cheng Kam Shui to obtain marked oil from Chi Shing oil barges positioned at Pak Shek Kok in Hong Kong. They identified photographs of three vessels, namely Chi Shing, Chi Shing 18 and Chi Shing 28 as the vessels from which they obtained marked oil on these voyages.[74] Sometimes they obtained the marked oil on credit and on other occasions they paid in cash. The former practice implied an arrangement between Cheng Kam Shui and Chi Shing. 136.None of the four Masters testified of any contact whatsoever with the 1st to 4th applicants. By contrast, Chen Ruihong testified of direct dealings with the 5th applicant, whom he met 20-30 times and knew to be the wife of Cheng Kam Shui in Hong Kong.[75] He knew her as the ‘lady boss’ and identified her from a photograph. He asserted that she knew that they smuggling.[76] He explained that when he came to Hong Kong she would ask him “For this month, how many times have you done that?”[77] Mr Donald did not cross-examine Chen Ruihong at all on behalf of the 5th applicant. The ambit of cross-examination of the four Masters 137.Much of the cross-examination of the four Masters was aimed at establishing the number of times they had been interviewed by the Mainland authorities at which statements had been made. The statements of 25 February and 25 March 2010 were used with some of the four Masters to establish that they had lied to the Mainland authorities, either as to when they had become involved in smuggling[78] and as to their involvement in making payments of money for the marked oil[79]. They accepted that they were minimising their own culpability. Similarly, they accepted, in effect, that there were deliberate omissions and lies in their statements, for example in respect of the full name of Cheng Kam Shui.[80] 138.For his part, Mr Delaney explored with the four Masters whether or not they had been involved in long distance voyages by fishing vessels. No doubt, that line of cross-examination was relevant to the huge amount of marked diesel bought by the four Masters on each of their visits to Hong Kong. Feng Jiu said that he had been as far as Hainan, but no further.[81] Chen Ruihong said that he had been as far as the Philippines and Vietnam on fishing voyages on wooden hulled fishing vessels, which carried 40 tonnes of fuel at most.[82] Huang Shunping said that the farthest he had travelled on his own boat was to Shanwei, a distance of about 40 nautical miles.[83] 139.Such challenge as was made to their substantive testimony was in respect of their testimony that the barges from which they had obtained the marked oil were Chi Shing barges. The challenge was advanced on the basis of inconsistencies between the oral evidence of some of the Masters and their witness statements of 25 February and 25 March 2010. So, for example Feng Jiu had testified in examination-in-chief that he had obtained fuel in these voyages from three vessels, which he named as Chi Shing, Chi Shing 18 and Chi Shing 28 and which he identified from photographs.[84] In cross-examination, Feng Jiu accepted that in his statement on 25 February 2010 he named only 2 vessels, namely Hoi Yeung and Chi Shing.[85] He accepted that he had referred to the vessel Hoi Yeung again in his statement of 25 March 2010.[86] Feng Jiu gave a non-responsive answer to the suggestion that he was mistaken about having obtained fuel from vessels other than the Hoi Yeung.[87] 140.Although Mr Blanchflower acknowledged in cross-examination of Huang Shunping that, consistent with his oral testimony, the witness had said in his statement of 25 March 2010 that he had obtained marked fuel from three vessels, namely Chi Shing, Chi Shing 18 and Chi Shing 28, he received an affirmative answer to this suggestion that he had not mentioned Chi Shing or Chi Shing 28 in the statement of 25 February 2010. However, no specific challenge was made to his testimony of having obtained fuel from those three stipulated Chi Shing oil barges. The omnibus question posed at the conclusion of cross-examination, namely that the witness “was not telling the truth to this Court” begged the question as to what.[88] 141.In his evidence-in-chief, Shi Rubin testified that he had obtained fuel from a vessel named Bao Shi or, if that vessel was not in position, from Chi Shing, Chi Shing 18 and Chi Shing 28.[89] However, he identified photographs of three vessels as being vessels from which he had obtained marked fuel.[90] In cross-examination, he accepted that in his statement of 25 February 2010 he had named only Bao Shi as such a vessel,[91] although he had mentioned obtaining fuel from Chi Shing 18, but not Chi Shing 28, in his statement of 25 March 2010.[92] The witness explained that at that time “he did not want to implicate the other oil vessels.”[93] No specific suggestion was made to the witness that he had not obtained fuel from a Chi Shing vessel. Mr Blanchflower’s cross-examination ended with the unspecified, general assertion that the witness was not telling the truth, which met with a negative response. Again, the assertion begged the question, as to what? 142.Similarly, although Chen Ruihong testified in evidence-in-chief that he had obtained marked diesel oil from Chi Shing 28, Chi Shing 18 and Chi Shing and identified them in photographs,[94] he accepted that in his statements of 25 February and 25 March 2010 he had stipulated one of the vessels to be Hoi Yang and had not mentioned the vessel Chi Shing 18.[95] Once again, the cross-examination culminated with a general assertion that the witness was not telling the truth. That begged the question as to what? Conclusion 143.In the result, we are satisfied that the judge was very much alive to the imperfections of the four Masters, and their possible motive of an early release from prison, and was correct to determine that no unfairness was likely to occur in the trial of the applicants in consequence of receipt of the evidence of the four Masters. The four Masters : credibility and reliability 144.Further, having admitted the evidence at the trial the judge was entitled, as he did, to accept their explanation as to their initial lack of candour to the Mainland authorities as emanating in part from the fact that they had been threatened by Cheng Kam Shui not to make revelations if detained[96] and to determine that he believed their testimony.[97] The judge’s reliance on the prosecution’s forensic accountant evidence 145.At trial the defence challenged Mr Chung Yuk Lam’s expertise to give the evidence articulated in his report, in particular in relation to the trend of sales of oil by the three Chi Shing barges. Complaint was made then, repeated in this Court, that he had “no experience in or knowledge of oil trading business or the fishing industry”. Also, complaint was made that part of his report involve no more than collating data in tabular form. In consequence, before ruling on that issue the judge received evidence from Mr Chung Yuk Lam and submissions from the parties which occupied a whole day of the proceedings. 146.Mr Cheung testified that having graduated with a First Class Honours degree in Electrical and Electronic Engineering from Leeds University in 1987 he joined Ernst and Whinney on his return to Hong Kong. Having worked with Esso Oil Company from 1990 to 1994, in that year he returned to public practice auditing with KPMG, qualifying as a Certified Public Accountant that year. In 1998 he began working as a forensic accountant. Now, he was a fellow member of the Chartered Accountants of Hong Kong and of the Chartered Accountants of England and Wales and a partner of the Forensic and Dispute Services team in China/Hong Kong of Deloitte Touche. One side of his work as a forensic accountant was the investigation of accounting fraud, management fraud or employee misappropriation of assets and corruption cases, in respect of which he prepared reports for his clients many of whom were listed companies. However, notwithstanding that breadth of experience, he said that he had never given evidence as an expert witness in a criminal trial. 147.In cross-examination by Mr Blanchflower, Mr Cheung accepted although, as stated in his curriculum vitae, he had experience working in different industries including the oil and gas industry that did not include the sale of marked oil to fishing vessels by oil barges in Hong Kong or the fishing industry in Hong Kong.[98] 148.Mr Cheung confirmed that his terms of reference were as described in his report and included :[99]
149.In his reserved ruling the judge said :[100]
150.In the event, Mr Cheung gave evidence at trial over a period of nine days, during which he was cross-examined for five days. Of that, the judge said :[101]
151.In the result, the judge said of Mr Cheung :
152.Of the issue of the absence of certain records, the judge said :[102]
153.Of the fact that Mr Cheung was not an expert in the fishing industry of Hong Kong the judge said :[103]
154.Of other criticisms made of Mr Cheung, the judge said :[104]
Conclusion 155.We are satisfied that the judge was correct to reject the criticism of the opinions expressed by Mr Cheung mounted on the basis that he had not given evidence as an expert witness before or that he had no specific expertise in the fishing industry of Hong Kong or the sale of marked oil to fishing vessels from barges in Hong Kong. Clearly, as the judge determined, his role as forensic accountant was to collate and analyse data recorded in the various records available to him and, if appropriate, express his opinion. Similarly, the judge was correct to reject the submission that the absence of some parts of some records impugned Mr Cheung’s report such that the Court should not rely on it. So, in respect the sale of oil from the 3 Chi Shing barges that was available to him, although incomplete in parts, sufficient information from the white and yellow Chi Shing invoices, the VCS forms, the general ledger of Chi Shing and banking records for Mr Cheung to have an overview of the activity. Where documentation was missing, he said so. Where possible he had recourse to other documentation to fill a gap. From that collated data he was able to compare the trend in sales of oil by Chi Shing barges in 2008-2009 and 2009-2010. 156.We will address these specific criticisms of the judge’s reliance on particular parts of Mr Cheung’s report and testimony later in the judgment. The judge’s determination in respect of section 94A of the CPO 157.Section 18 of the I & E Ordinance provides :
158.There is no issue that at trial the prosecution did not seek to rely on section 94A of the CPO. Although the judge was presented with very lengthy written closing submissions by the parties, supplemented by even more lengthy oral submissions the subject of section 94A was not raised by counsel or by the judge. 159.Mr Blanchflower did submit that there was no evidence from the four Masters in respect of the presence or absence of manifests on their vessels on the impugned voyages. Perhaps, it was in that context that the judge was drawn into making what the respondent characterised as being a “comment” on the subject. It is most regrettable that the judge did not raise the matter with counsel during their lengthy closing submissions or, indeed, subsequently. As is clear from the written and oral submissions made by Mr Blanchflower in his closing speech, the issue was addressed on a broader front, namely that not only was there no evidence of manifests on the four vessels on their respective voyages during the material period but also there was no evidence of discussions let alone an agreement between the conspirators that the cargoes of marked oil would be exported from Hong Kong without the relevant manifests. 160.In his closing written submissions Mr Blanchflower said of the four Mainland Masters :[105]
161.In making his oral closing submissions, Mr Blanchflower adopted the scheme of reading out the written submissions and adding, from time to time a further oral commentary. Of this point, he added orally :[106] “Not a question asked.” 162.Then, returning to his written submissions Mr Blanchflower went on to assert :[107]
Finally, he concluded :[108]
163.It is clear that, having considered the ambit and operation of section 94A of the CPO in the context of section 18 of the I & E Ordinance the crucial determination of the judge was that, “it is not necessary for the prosecution to prove there was no manifest.”[109] 164.Immediately before his digression into a consideration of the juxtaposition of those two sections of the two Ordinances, the judge had identified the elements of the conspiracy alleged in Charge 1, namely that the prosecution must prove beyond reasonable doubt :[110]
165.At an early stage in his Reasons for Verdict, the judge had identified what he described as the “...issues this Court has to determine” in respect of Charge 1 :[111]
Findings 166.Having set out the issues relevant to Charge 1 and having recited the relevant evidence in narrative form, the judge moved to make his findings. He said :[112]
167.It is clear that there is considerable force in the submissions of the applicants that the judge erred in his determination that section 94A of the Ordinance was relevant to Charge 1, a charge of conspiracy. The authorities to which Mr Blanchflower has referred the Court speak with one voice as to that error. 168.In his judgment in the Court of Final Appeal in HKSAR v Ng Po On, with which all the other judges agreed, Ribeiro PJ noted the difference between a statutory substantive offence, containing a reverse onus provision, and a conspiracy to commit that offence :[113]
169.Ribeiro PJ went on to cite with approval the passages quoted earlier from the judgment of Lord Woolf in HKSAR v Lam Yuk Fai in which the latter had noted the nature of the conspiracy in that case, namely that it was an agreement between the parties, the purpose of which was that the passport should be used for an unlawful purpose, in consequence of which Lord Woolf said :[114]
The construction of section 18 of the I & E Ordinance : an offence with an exemption? 170.In addressing the respondent’s alternative submission that section 18 of the I & E Ordinance is to be construed as creating an offence of exporting cargo, with an exception/exemption to the commission of the offence in the preparation and use of a manifest, it is necessary to have regard to the substance and reality of the language creating the offence, rather than its form, and to do so in the context of the legislation, having regard to its object and purposes.[115] 171.As Mr Blanchflower pointed out in his written reply, Patrick Chan J, as he was then, considered the elements of the offence in The Queen v Cheng Kai & Another :[116]
172.With respect, that construction of the section and the identification of the elements of the offence is entirely consistent with the purpose and object of the I & E Ordinance identified in the preamble to the Ordinance, namely :
In context, it is relevant to note that section 18(2) makes provision for a ‘due diligence’ defence. 173.Accordingly, we reject Mr Lee’s submissions that section 18(1) is to be construed as creating an offence of exporting cargo, together with an exemption or exception in the form of a manifest. Conclusion 174.In the result, we are satisfied that in proof of the offence alleged in Charge 1, namely conspiracy to export unmanifested cargo, it was necessary for the prosecution to prove that the co-conspirators were parties to an agreement to do that unlawful act intending that it be done. In that context : the statement of Ribeiro PJ is apposite, “The inchoate offence exists at common law and, in accordance with the general common rule, does not involve any reverse onus. This is unaffected by s. 94A.”[117] Accordingly, we are satisfied that the judge was in error in respect of a question of law in determining that by operation of section 94A of the CPO “it is not necessary for the prosecution to prove that there was no manifest.” The ‘proviso’ 175.In those circumstances it is necessary to consider the significance of the judge’s error in respect of the operative effect of section 94A of the CPO, in particular that “it is not necessary to the prosecution to prove there was no manifest”, in the context of the available evidence of the existence of a conspiracy to export from Hong Kong unmanifested marked oil. Specifically, notwithstanding the wrongful imposition of a reverse onus provision on the applicants, is it appropriate to sustain those convictions by operation of the proviso? Evidence of the four Masters : cargo manifests for marked oil 176.It was the written submission of the respondents in reply that there was “clear circumstantial and direct evidence from the PRC witnesses that they had not prepared or filed any document for C & E in respect of the marked oil.” Direct evidence 177.The assertion that there was direct evidence from the four Masters of that issue is simply not borne out by examination of their testimony. All four of the Masters testified in evidence-in-chief that they had been convicted and were serving long sentences of imprisonment in the Mainland for offences arising from “smuggling” marked oil into the Mainland. It was that aspect of smuggling that was the focus of their evidence-in-chief. The issue of any culpability arising out of their conduct in Hong Kong was hardly explored. 178.It was the common theme of their evidence that they had been recruited to smuggle marked oil from Hong Kong into the Mainland by Cheng Kam Shui. They travelled from Ao Tou, Huizhou in the Mainland[118] into Hong Kong waters, at the direction by telephone of Cheng Kam Fai or Hu Ying Gao, to purchase marked diesel oil from specified Chi Shing oil barges, which they identified. Then, after they had made payment in cash for that marked oil, or sometimes acquired it on credit, they steered their vessels back from whence they had come. There, the oil was discharged ashore. Fuel tank capacity had been enlarged on some of the vessels.[119] Separate small fuel tanks provided fuel for the journey to and from Hong Kong[120] or a very small percentage of the fuel bought in Hong Kong was used on the voyage back to the Mainland[121]. The marked fuel was not used in fishing voyages. Clearly, the irresistible inference was that the marked diesel oil was cargo, pursuant to the I & E Ordinance. 179.The issue of whether or not a manifest was carried on any of the voyages of the four Masters to the Mainland after they had bought marked oil in Hong Kong was raised with only one of the four Masters, namely Huang Shunping. He was asked the single question : “When you transported oil from Hong Kong to the Mainland was a manifest on board?”[122] In face of an objection by Mr Blanchflower, that the question was leading, Mr Luk abandoned that line of questioning, never to return to it. The matter was simply not raised with any of the other Masters. Similarly, the issue of the requirements of Hong Kong law in respect of the export of marked oil carried as cargo, rather than as fuel to be used in the voyage of the vessel, was never explored with the four Masters. So, there was no direct evidence from any of the four Masters of an agreement between any of them and other co-conspirators to do the unlawful act, namely to export unmanifested cargo, intending that it be carried out. Circumstantial evidence 180.On the other hand, there was evidence from the four Masters from which it might be inferred that not only were no manifests prepared and carried on the four vessels in respect of the export from Hong Kong of the marked oil as cargo but also that it was never intended that they be prepared and carried on the vessels and that was an unspoken agreement between the conspirators. For example, the following interchange ensued in examination-in-chief of one of the Masters, Chen Ruihong :[123]
Although the witness had raised the issue in terms that begged for the matter to be followed up with further obvious questions, none were asked. The prosecution’s closing speech 181.Of the issue of the absence of manifests in respect of the cargo of marked oil on the fishing vessels, in its closing oral submissions the prosecution submitted :
182.In the context of the evidence of the four Masters having testified that they had been recruited to smuggle marked oil into the Mainland, it was asserted :
183.However, counsel for the prosecution went on to say of the four Masters :
184.The submission that there was no evidence that the four Masters were aware of a requirement to describe the marked oil cargo that they had loaded on their vessels in Hong Kong in manifests was at least consistent with the absence of any evidence to that effect. As noted earlier, the prosecution made no or minimal attempt only to adduce evidence from the four Masters in that respect. However, it was an issue that went to the heart of the conspiracy alleged in Charge 1. The prosecution was required to prove that the co-conspirators agreed to do the unlawful act (s), namely export unmanifested marked oil as cargo, with the intention of carrying out that/those act (s). 185.As noted earlier, the substantive offence created by section 18 of the I & E Ordinance is an offence of “strict liability”.[124] Accordingly, liability follows even in the absence of mens rea. However, as Yeung VP noted in HKSAR v Yung Lai Lai, in Churchill v Walton[125] the House of Lords determined that approach was inapplicable to a conspiracy to commit such an offence.[126] Viscount Dilhorne said :[127]
186.In giving focus to the terms or effect of the agreement between the parties, Viscount Dilhorne posed the rhetorical question :
187.Those principles are reflected in section 159A(2) of the Crimes Ordinance, Cap. 200 :
188.The issue that arises is whether or not there was evidence that the four Masters, or any one of them, was a party to an agreement with Cheng knowing of a fact or circumstance necessary for the commission of the offence, namely that their various cargoes of unmarked oil were not described in manifests whilst those vessels were in Hong Kong waters. 189.Having regard to all the evidence, notwithstanding the issue of their ignorance of the law, and the inexplicable failure of the prosecution to set out deliberately to adduce testimony relevant to the issue, nevertheless there was clear evidence of that. The four Masters were in command of the respective vessels on their voyages out of Hong Kong with cargoes of marked oil. They loaded the marked diesel onto their vessels and made payments, normally in large sums of cash, to the operators of the diesel barges. The tenor of their evidence reflected a complete disinterest in such desultory amount of documentation as was produced to reflect the transactions. Three of the four Masters said that they threw away the invoice/receipt provided to them by the Chi Shing oil barges.[128] Chen Ruihong said that he did so on the instructions of Cheng Kam Shing. The judge’s findings : a conspiracy to smuggle marked oil out of Hong Kong and into the PRC 190.The judge approached his findings in respect of the existence of a conspiracy as alleged in Charge 1 in stages. First, he considered whether or not the four Masters and Cheng Kam Shui, were parties to that conspiracy. Then, he considered whether the various applicants were co-conspirators in that conspiracy. Of the existence of the conspiracy, he said :[129]
191.Earlier, the judge determined of the four Masters :[130]
192.The judge went on to find :[131]
193.It is correct, as Mr Robert Lee submitted, that nowhere in that analysis, or indeed in respect of the considerations of the separate cases of the various applicants, did the judge advert specifically to his determination that it was not necessary for the prosecution to prove “that there was no manifest”. More particularly, he did not state that he relied on that determination to find, first that there were no manifests and, secondly that the fact of their absence was evidence which supported a finding that there was an agreement among some or other of the conspirators to export unmanifested marked diesel oil from Hong Kong as alleged in Charge 1. 194.On the other hand, he did identify clearly what evidence he did rely on to make his finding. Having stated that he accepted the evidence of the four Masters, the judge said that he found that there was “a conspiracy to smuggle marked oil out of Hong Kong and into the PRC.”[132] He accepted that they had been recruited by Cheng Kam Shui and had collected marked oil from oil barges in Hong Kong belonging to Chi Shing and paid for it, when they did so, with monies provided to them either before the voyage or in a rendezvous with a speedboat. He found that the fact that some oil was provided on credit[133] indicated an agreement between Cheng Kam Shui and those in control of Chi Shing barges in Hong Kong.[134] On return to the Mainland, the oil was simply off-loaded. ‘Lack Chai’ notebook and 28 November 2009 white Chi Shing invoice 195.The judge identified the ‘Lack Chai’ notebook and the white Chi Shing invoice, dated 28 November 2009 as demonstrating “a clear link between the activities of Cheng Kam Shui on the Mainland and Chi Shing in Hong Kong”.[135] First, he accepted the evidence of the four Masters that ‘Lack Chai’ was the nickname of Cheng Kam Shui. Then, he noted that the former “contains records of oil sales transactions” and had been found in the home of the 1st and 2nd applicants and that the latter had been found at the Mei Fung Court registered address. ‘Lack Chai’ notebook 196.Although the ‘Lack Chai’ notebook did not identify the particular vessels to which sales were made and covered only five trading days, it described patterns of large daily purchases of oil, sometimes twice a day. Given that was obviously linked to Cheng Kam Shui, its significance lay in the fact that, on the evidence of the four Masters which was accepted by the judge, he was the organiser of the smuggling activities of the four Masters, in which he directed that they purchase marked oil from Chi Shing barges. The huge volume of individual purchases was consistent with the evidence of all four Masters, whereas the twice-daily purchases were consistent with the evidence of Feng Jiu in respect of some of his purchases.[136] 197.Taken overall, the purchases attributed to individual vessels in the notebook were obviously not consistent with the purchase of fuel to be used for purposes of fishing voyages. For example, ‘Vessel 1’ was described as having loaded eight consignments of 120,800 litres, a total of 966,400 litres on and between 25 and 31 January 2010. On three of the dates it took on two consignments of 120,800 litres each. That was wholly consistent with the oil being offloaded in the Mainland and the vessel returning to Hong Kong to load yet more oil. 28 November 2009 white Chi Shing invoice 198.As noted earlier, the white Chi Shing invoice dated 28 November 2009, identified by Feng Jiu as having been signed by him, bore the invoice number 65067 and related to the sale of 120,800 litres of oil, whereas in the Daily Sales Transaction Summary for that date there was no reference to invoices with the prefix ‘6’.[137] Similarly, the VCS form faxed to the Customs and Excise Department in respect of sales by Chi Shing for that date does not refer to that invoice number nor does it stipulate any sale of more than 68,000 litres of oil.[138] Yellow/white Chi Sing invoices and VCS forms 199.The general context in which the judge found that not only was there a conspiracy to smuggle oil out of Hong Kong and into the Mainland at which Cheng Kam Shui was at the centre but also that there was a link between the conspirators and Chi Shing was the judge’s earlier determination that he accepted the evidence of Mr Cheung Yuk Lam, the prosecution expert witness.[139] In his report and oral testimony Mr Cheung collated the information contained in the white and yellow invoices and the VCS forms.
200.Mr Chung testified that of the 10,812 yellow invoices, all but four of them were reflected, as to invoice numbers and date, in the information contained on the VCS forms faxed to the Customs and Excise Department. Similarly, all but 39 of those yellow invoices reflected the quantities of oil said to have been sold on those occasions.[140] 201.The particular context was the judge’s acceptance of Mr Cheung’s evidence in respect of the white Chi Shing invoices when compared with the yellow Chi Shing invoices and the VCS forms. There was a positive correlation in the data contained in the latter two documents : the yellow Chi Shing invoices supported the declarations made in the VCS forms. By contrast, although the aggregate volume of oil sales described in the white Chi Shing invoices were broadly similar to those described in the yellow Chi Shing invoices, individual oil sales were quite different. Of that, the judge found in respect of the 1st to 3rd applicants :[141]
202.Of their respective positions in Chi Shing, the judge observed earlier :[142]
203.The general circular issued by the Customs and Excise Department dated 21 January 2009, acknowledged by the 3rd applicant in his own hand on 9 April 2009, made it clear that a major concern of the Department in respect of smuggling of marked oil was the use of the enlarged fuel tanks. Clearly, a system of deliberately underreporting individual sales to the Customs and Excise Department had the effect of concealing from them information that might have alerted them of large sales of marked oil. The 3rd applicant 204.Of the role of the 3rd applicant in Chi Shing, it is to be noted that it was the evidence of Customs and Excise Officer Lo Wing Nin that the occasion for the meeting on 9 April 2009 between him and the 3rd applicant had come about in the context of the 3rd applicant pursuing an application to have the registration of Chi Shing 28 to sell oil reinstated, it having been cancelled because those operating it had sold oil outside a designated area. In that context, he said that the 3rd applicant “wrote many documents and faxed many documents to our office asking for reinstatement.”[143] 205.Having determined that the 1st to 3rd applicants “could not have been unaware of the improper practice with regard to the yellow invoices and VCS forms faxed to the Customs & Excise Department” the judge said that other factors identified in Mr Cheung’s evidence, coupled with that primary finding, led him “to draw the irresistible inference” that those applicants were “actively engaged in a conspiratorial agreement to smuggle marked oil”.[144] As examples, he identified :[145]
The mixing of accounts Deposits into the bank accounts of Chi Shing 206.In his report Mr Cheung presented the collated information in respect of the provenance of the deposits into the two Chi Shing bank accounts in the period 1 June 2009 and 31 January 2010 in a table at 8.4.[146]
[RAMC was the acronym used for Remittance Agents and Money Changers.] Deposits into the bank accounts in the name of the 3rd applicant 207.In a table at paragraph 8.5 of his report Mr Cheung described the monies received into the bank accounts in the name of the 3rd applicant in the period 1 June 2009 to 31 January 2010.
Deposits into the bank accounts in the name of the 4th applicant 208.Although in the period 1 June 2009 to 31 January 2010 the 4th applicant deposited over $103 million into the HSBC bank account of Chi Shing, in the greater period encompassing 1 January 2009 to 3 May 2010 deposits of only $662,435 were made to his bank accounts.[147] 209.In his Reasons for Verdict the judge noted of Mr Cheung’s analysis of the personal bank accounts of the applicants that there were a large number of business payments and receipts being transacted through the accounts with no apparent justification. He labelled this as “highly usual (sic) if not suspicious”. Further, he noted that whilst Mr Cheung accepted that it was not unheard for directors or employees of companies to handle small amounts of the company’s money through their personal accounts it was his evidence that “the sheer magnitude of the transaction through personal accounts was unusual as it would expose the company to unnecessary risks.”[148] Of the issue or whether the deposits made into the accounts of the 3rd applicant, subsequently paid into the accounts of Chi Shing, might have been payments by customers of Chi Shing who preferred to pay the 3rd applicant directly, the judge noted that Mr Chung said that “would be extremely unlikely” and that it would be “stupid” of customers to do so.[149] Increased sales of oil 210.The judge’s reliance on the evidence of increased sales of oil in the period 1 June 2009 to 31 January 2010 as part of the circumstantial evidence from which he drew inferences adverse to the 1st to 3rd applicants was, as he said, based on the findings of Mr Cheung. Earlier in his Reasons for Verdict the judge found of Mr Cheung’s evidence :[150]
211.It is clear that the judge’s reference to high sales in August 2009 of $273 million was a slip on his part, for what ought to have been a reference to July 2009. Mr Cheung conducted a comparative analysis of monthly sales by the three Chi Shing oil barges. Of monthly sales in the period 1 June 2009 to 31 January 2010, he noted that :[151]
212.The four Masters described commencing their smuggling activities for Cheng Kam Shiu at different times. Feng Jiu said in evidence in chief as he began to smuggle in 2008. In cross-examination by Mr Blanchflower he said that his assertion in his statement of 25 March 2010 that he began to smuggle at the end of October 2009 was true. In re-examination he said that it was in the latter half of 2008.[152] Chen Ruihong said that he began smuggling in February 2009 but, because the vessel was often out of order, he began smuggling formally in September 2009.[153] 213.In evidence-in-chief Huang Shunping testified that he began smuggling “roughly in July 2009”. In cross-examination he accepted that in his statement of 25 March 2010 he had said that he had first boarded the vessel on which he smuggled in October 2009. However, he went on to explain “..in July, it did happen but I mean at that time the account books were not shown to me”. He added “..we thought that the relevant authorities have not found out the truth..... subsequently we were shown what had been found out... so it was impossible for us to deny it.”[154] He accepted that his assertion in the 25 March 2010 statement that he began smuggling in October was a lie. For his part, Shi Rubin said that he began smuggling in “August, September 2009”.[155] Deposits of $228 million into the accounts of Chi Shing in excess of sales of oil 214.The judge’s reference to total deposits to Chi Shing’s bank accounts as being $3.7 billion was clearly a reference to paragraph 7.3 of Mr Cheung’s report in which he calculated that the total deposits to the bank accounts of Chi Shing, with eliminations, in the period 1 January 2009 to 30 April 2010 was $3,727,645,646. Mr Chung made it clear that, since he did not have data for the months of April to June 2009, those months were excluded from his comparison.[156] In reaching that total of ‘Deposits to Chi Shing’, he stated “April-June excluded”. Similarly, in respect of the monetary value of the sale of oil for those same months ‘Sales amount’ he stated “No data”, noting that there were neither white Chi Shing invoices nor General Ledger entries for those months. He stated that his calculation of sales was based on white Chi Shing invoices, save for February 2009 in respect of which he had relied on data from the General Ledger. Finally, in his calculation of ‘Deposits in excess of sales’ for those months, he stated “Not comparable”. Accordingly, it is clear that his calculation that deposits into the bank accounts exceeded sales of oil by Chi Shing by $228 million referred to the period 1 January 2009 to 30 April 2010, excluding April to June 2009 inclusive. 215.It follows that the judge was not in error to state that “over the same period” there were deposits of $228 million more than sales of oil. Of more importance was the relevance of that evidence to the issues the judge was addressing. Clearly, the period of time encompassed months that lay outside the period stipulated for the existence of the conspiracy, namely 1 January to 31 May 2009 and 1 February to 30 April 2010. Also, the period 1 April to 30 June 2009 was excluded in the absence of data. Further, it is to be noted that in April 2010 deposits of monies to the bank accounts of Chi Shing exceeded the sale of oil by $106 million. Nevertheless, as Mr Blanchflower conceded in the period of the conspiracy, excluding June 2009, deposits of monies to the accounts of Chi Shing exceeded sales of oil by $72 million. 216.The significance of that evidence lay in the evidence of Mr Chung to the effect that in a business of the size and with operations similar to Chi Shing “there should not be significant differences between the overall sales total receipts over a period of time”. He suggested that the discrepancy might be explained by the fact that a portion of the bank receipts were not related to its normal operations or that the white Chi Shing invoices, upon which he had based his analysis, did not reflect the full scale of sales by Chi Shing.[157] Salaries : personal wealth 217.No doubt, the judge’s observation in respect of their modest salaries[158] was made having regard to the Employer’s Return of Remuneration made to the Inland Revenue by Chi Shing for the year ended 31 March 2010[159], to which the judge had referred earlier.[160] There, the 2nd and 3rd applicants were described as receiving salaries for the year of $240,000, the 1st applicant $210,000 and the 4th applicant $225,200. The annual profits before tax declared to the Inland Revenue by Chi Shing for the years ended 31 March 2008 and 2009 were $2,462,975 and $1,597,747.66 respectively.[161] 218.As the judge noted,[162] the 1st and 2nd applicants had acquired their Bel-Air home and 3 car parking spaces in November 2009 for $36 million, only $15 million of which was by way of mortgage, whereas the 3rd applicant had acquired around $10 million HSBC shares in March 2010. Although the 4th applicant’s annual salary was $225,200 in the period 1 January 2009 to 3 May 2010 he withdrew $661,500 from his bank account. Conclusion 219.We are satisfied that, in the context of his finding that the 1st to 3rd applicants were aware of the making of yellow Chi Shing invoices which supported the VCS forms which were faxed to the Customs and Excise thereby deliberately under reporting the sales of oil, the judge was entitled to have regard to the various matters that he enumerated and from which he drew the irresistible inference that they were all “actively engaged in a conspiratorial agreement to smuggle marked oil.” That evidence was circumstantial in nature and gave context and perspective to the deliberate underreporting of individual sales of oil. The 4th applicant 220.Having noted though that it an agreed fact that the 4th applicant had made cash deposits to Chi Shing’s HSBC account of $103,802,350 in 100 transactions in the period 12 June 2009 to 13 January 2010, the judge noted that those payments stopped immediately after the arrest of Cheng Kam Shui from which he inferred :[163]
221.Next, the judge determined that the discovery of a Sales Transaction Summary for the month of November 2009 on the 4th applicant’s computer, which was identical to the Sales Transaction Summary of the white Chi Shing invoices linked the 4th applicant “to the preparation and creation of accounting documents”. Deposits into the bank accounts in the name of the 4th applicant 222.In the period 1 June 2009 to 31 January 2010 the 4th applicant deposited over $103 million into the HSBC bank account of Chi Shing. In the greater period, encompassing 1 January 2009 to 3 May 2010, deposits of $662,435 were made to his bank accounts.[164] The judge noted that Mr Cheung expressed the opinion that those deposits into the account in the name of the 4th applicant were “inconsistent” with his annual salary from Chi Shing of $225,000.[165] 223.Finally, the judge said that in reliance on those facts he drew the :
The 5th applicant 224.In his consideration of the case of the 5th applicant the judge acknowledged that, given that she had no role whatsoever in the operations of Chi Shing, she occupied “a different position” from the other applicants.[167] However, he noted that she had made what he described as “massive” deposits of $45,761,871 to the accounts of Chi Shing in the period the subject of the conspiracy. 225.In cross-examination by Mr Donald, Mr Cheung confirmed that the aggregate payment of $45,761,871 to the account of Chi Shing by the 5th applicant had been made by 10 separate payments.[168] A schedule of those payments from the Bank of China account of the applicant was set out at paragraph 37 of the affirmation of Wong Kit Ying.[169] From that schedule, it is apparent that in the period on and between 2 and 21 November 2009 the 5th applicant deposited no less than $21,358,311 into the account of Chi Shing. Equally apparent from the schedule, was the fact, noted by Mr Cheung, that the aggregate of payments made by the 5th applicant to Chi Shing in the period April to December 2008 inclusive was less than one quarter that made for the same months in 2009. Deposits into the bank accounts in the name of the 5th applicant 226.The provenance of the monies received into the bank accounts in the name of the 5th applicant in the period 1 June to 2009 to 30 January 2010 was described in a table at paragraph 8.6 of Mr Cheung’s report.
227.Of the fact that a large proportion of those monies were remittances from Remittance Agents and Money Changers, and in the context of his rejection of her assertion in out-of-court statements that those remittances and payments to Chi Shing of $45,761,871were made at the behest of her husband and were for oil to be used for legitimate fishing voyages of Cheng Kam Shui’s fishing fleet, the judge determined :[170]
228.Notwithstanding that finding, it is clear that the judge was aware that the 5th applicant had made payments to Chi Shing from her accounts in the period prior to that commencing on 1 June 2009. Earlier, he had noted of the evidence of Mr Chung :[171]
229.The payment of $21,358,311, noted earlier, made by the 5th applicant to Chi Shing in the three-week period in November 2009 was about double that of the net aggregate payments made to Chi Shing in the nine months period April to December inclusive of 2008. Mr Cheung had observed in his report that there was no evidence at all of a commensurate increase in the fishing business of Cheng Kam Shui.[172] Clearly, in all circumstances the judge was entitled to reject the out-of-court assertions of the 5th applicant as having no weight, namely that the payments that she made in the period of the conspiracy were for legitimate fishing activities. 230.In convicting the 5th applicant of the 1st charge the judge found that, being aware of the smuggling activities, she had participated in those activities “...by making these massive deposits to CSDL’s Bank of China account over the prosecution period and also assisted the crew members by purchasing food for them prior to them embarking on their smuggling activities.”[173] 231.Clearly, the judge’s reference to the assistance given by the 5th applicant to the crew of the vessels used for smuggling by purchasing food for them on their voyage was to the testimony of Chen Rhuihong. As noted earlier, it was his evidence that she knew of their smuggling activities, she having asked him, “For this month, how many times have you done that”?[174] In that context, he said of their departures from Hong Kong on such smuggling expeditions, “at the time when we were leaving she would buy us some food for cooking... also if we had any need we would tell her.”[175] Given that the judge’s findings that the 5th applicant not only knew of the smuggling activities but also participated in the conspiracy by making massive deposits of monies to the bank accounts of Chi Shing, the judge was entitled to regard the assistance rendered to Chen Rhuihong and his crew as further acts in furtherance of the conspiracy. CONCLUSION The proviso 232.Notwithstanding our finding that the judge’s determination, that section 94A of the Criminal Procedure Ordinance operated so that it was not necessary for the prosecution to prove that manifests were carried on the vessels, was “a wrong decision on a question of law”[176], nevertheless we are satisfied that it is appropriate to apply the proviso, given that we are satisfied that no miscarriage of justice has actually occurred. The test to be applied in cases in which the proviso is invoked is as set out in the judgment of Sir Anthony Mason NPJ, with whom all the other judges agreed, in the Court of Final Appeal in Launder v HKSAR, namely :”[177]
233.In the first place, although the judge’s determination was wrong on a question of law, we are satisfied that he did not apply that erroneous determination of the law to his analysis of the facts of the case. Certainly he did not state that he did so. In that context, it is significant to note the language that he used in his preamble to making his determination, namely :[178]
The tenor of the judge’s determination resonated with the judge traversing what he determined to be an erroneous submission by counsel. Secondly, for the reasons set out above, we are satisfied that there was overwhelming evidence to support the judge’s finding that each of the applicants was a party to the conspiracy alleged in Charge 1, so that a jury or a judge would have inevitably come to the same conclusion. Charges 2, 3-5 234.No issue was taken in behalf of the applicants to the validity of their convictions respectively on Charge 2 (1st and 2nd applicants), Charge 3 (3rd applicant), Charge 4 (5th applicant) and Charge 5 (4th applicant), if their convictions on Charge 1 were sustained. With respect, that was the correct approach. In those circumstances, we are satisfied that those respective convictions were entirely justified. Charge 6 (1st and 2nd applicants) 235.Charge 6 concerned a total of RMB 7,141,300 and HK$9,812,800 in cash found on 3 May 2010 in the Bel-Air home of the 1st and 2nd applicants, most of which was contained in commonplace red, white and blue nylon bags placed on the floor in the master bedroom. There was force in the submissions made by Mr Blanchflower on the behalf of the 1st and 2nd applicants that, given the hiatus between the end of the conspiracy alleged in Charge 1, namely 1 February 2010 and the commission of the offence the subject of Charge 6, namely 3 May 2010, it was necessary for the judge to examine with care the issue of the provenance of those monies. 236.There was no dispute that considerable amount of money was found packaged in bundles of notes. As Mr Blanchflower pointed out, given the fact that five bundles of RMB 100,000 each were packaged with strips of paper that bore dates in the period 31 March to 13 April 2010, there was a strong inference that some of the monies at least had their provenance other than from the smuggling the subject of Charge 1. Also, having regard to the undisputed evidence of a pattern of behaviour of the applicants, including the 1st and 2nd applicants, of regularly exchanging large amounts of Renminbi for Hong Kong dollars, it was suggested that there was no reason why, if the provenance of those monies lay in smuggling, they would have been kept for about three months. 237.Furthermore, there was no dispute that even legitimate sales of marked oil by Chi Shing generated large payments in cash in both Renminbi and Hong Kong dollars. In that context, it is to be noted that Mr Cheung found that the white Chi Shing invoices available for April 2010 detailed sales of over $213 million of marked oil.[179] Those VCS forms received by the Customs & Excise Department from Chi Shing for April 2010 stipulated the sale of 36,370,261 litres of marked oil, whereas VCS forms found in the Goodview Centre stipulated sales of 44,515,229 litres of marked oil. 238.Although these considerations and other issues were raised in closing written and oral submissions by Mr Blanchflower, the judge had adverted to none of them in his Reasons for Verdict. Having found that the 1st and 2nd applicants knew that the $2,623,226,783 received into the two accounts of Chi Shing in the period 31 May 2009 to 1 February 2010 (Charge 2) were the proceeds of an indictable offence, namely smuggling the judge went on to say simply :[180]
239.With respect to the judge, the issues raised on behalf of the 1st and 2nd applicants required addressing. The judge was not entitled, as he did, to ignore those issues. The factual circumstances obtaining in the period the subject of Charge 2 no longer obtained on 3 May 2010. With the arrest of Cheung Kam Shui and the four Masters the smuggling conspiracy had come to an abrupt end three months earlier. The sharp drop in the volume of sales of marked oil by Chi Shing in the ensuing months spoke eloquently of that fact. 240.Although the circumstances giving rise to Charge 6 were suspicious, given the judge’s failure to address the plausible submissions advanced on behalf of the 1st and 2nd applicants, let alone give any reasons for rejecting them, we are unable to say that their convictions on Charge 6 are safe. Charge 7 (1st, 2nd and 3rd applicants) 241.Charge 7 concerned $627,000, comprised of 627 $1,000 notes, found in a black briefcase in a wardrobe in the Mei Fung Court premises on 3 May 2010. There was no dispute that on the discovery of the briefcase and its contents, the 3rd applicant had responded to an enquiry of a Customs and Excise officer to the effect that the briefcase belonged to him. 242.As the judge noted, no issue was taken with the evidence of several Remittance and Money Changers that in the period July 2009 to January 2010 the 3rd applicant, in common with the 1st and 2nd applicants regularly exchanged large amounts of Renminbi for Hong Kong dollars.[181] Similarly, there was no dispute that those applicants and the 4th applicant regularly made large deposits of Hong Kong dollars, comprised of bundles of $1,000 and $100 notes, to the accounts of Chi Shing.[182] 243.In his Reasons for Verdict, the judge dealt with Charge 7 very briefly. Having noted that the 1st and 2nd applicants were the owners of the Mei Fung Court premises in which the black briefcase containing $627,000 was found, he said :[183]
244.No issue was taken at trial or in this Court to the drawing of the inference, as the judge did, that the 3rd applicant knew of the presence of the cash inside his black briefcase. Very much at issue was the provenance of the monies. The matters to which we adverted in our consideration of Charge 6 are equally relevant to a consideration of Charge 7 : the conspiracy the subject of Charge 1 had come to an end more than three months earlier with the arrest of Cheng Kam Shui and the four Masters on 31 January 2010; nevertheless, in that period Chi Shing continued to sell hundreds of millions of dollars of oil; and large deposits in cash were made to Chi Shing’s bank accounts.[184] 245.The judge was required to address those matters, they having been raised squarely by counsel for the 4th applicant. Clearly, he did not do so or attempt to do so. In those circumstances, we are not satisfied that the conviction of the 3rd applicant of Charge 7 is safe. CONCLUSION 246.In the result, we grant all the applicants leave to appeal against conviction. We dismiss the appeals of all the applicants in respect of Charge 1, the appeal of the 1st and 2nd applicants in respect of Charge 2 and the appeals of the 3rd, 4th and 5th applicants in respect of Charges 3, 5 and 4 respectively. We allow the appeal of the 1st and 2nd applicants in respect of Charge 6 and the appeal of the 3rd applicant in respect of Charge 7 and quash those convictions.
Mr Robert S. K. Lee, SC leading Ms Memi Ng, SPP of the Department of Justice, for the respondent Mr Michael Blanchflower, SC leading Mr Jonathan Ah-weng, instructed by Lau, Chan & Ko, for the 1st applicant and 2nd applicant Mr Gerard McCoy, SC leading Mr Simon K. C. Ng and Mr Melo Man, instructed by Lau, Chan & Ko, for the 3rd applicant and 4th applicant Mr Richard Donald and Ms Winnie Chu, instructed by Francis Kong & Co., for the 5th applicant [1] Exhibit P 170. [2] Exhibit Bundle, pages 1576-1578. [3] Exhibits P 185 A - 190 A. [4] Exhibits P 230 J-L; 231 J-K and 232 J and K. [5] Exhibits P 603 F-Z and P 606 F-M. [6] Exhibit P 654. [7] Exhibit P 572 A-C. [8] Appeal Bundle, pages 1209-12; Exhibits P 185 F, P 186 F and P 187 F. [9] Appeal Bundle, pages 1219-20; Exhibit P 603 Y. [10] Appeal Bundle, pages 1237-9. [11] Exhibit P 185 E, pages E 381 and 397. [12] Exhibit P 711, (the expert report of Cheung Yuk Lam) page E 810, paragraph 9.29. [13] Expert Report, P 711 at paragraph 8.4, pages E 1119-20. [14] Expert Report, P 711, paragraphs 8.5. [15] Exhibit P 186 E. [16] Appeal Bundle, page 135. [17] Appeal Bundle, page 24. [18] Expert Report, P 711, paragraph 7.6. [19] Reasons for Verdict, paragraphs 18 and 19. [20] Reasons for Verdict, paragraphs 45-6. [21] Reasons for Verdict, paragraph 194. [22] Appeal Bundle, pages 1937-1939. [23] Reasons for Verdict, paragraphs 192-4. [24] HKSAR v Lam Yuk Fai (2006) 9 HKCFAR 281. [25] HKSAR v Lam Yuk Fai,page 292 C-F, paragraph 30. [26] Op. Cit. page 293 G-I, paragraph 33. [27] HKSAR v Ng Po On (2008) 11 HKCFAR 91, page 106 B-G, paragraph 37. [28] HKSAR v Yung Lai Lai [2012] 5 HKLRD 670, paragraph 71. [29] HKSAR v Lam Yuk Fai, page 294 H-I, paragraph 36. [30] Appeal Bundle, pages 1937-9. [31] Exhibit Bundle, pages E 475 - 494. [32] Exhibit Bundle, page E 381. [33] Reasons for Verdict, paragraph 236. [34] Reasons for Verdict; page 194 J-M, paragraph 191. [35] Reasons for Verdict; pages 197 F - 201 L, paragraphs 203-222. [36] Respondent’s Written Submission in Reply, paragraph 80: “…there was clear circumstantial and direct evidence from the PRC witnesses that they had not prepared or filed any document for C & E in respect of the marked oil. In all the circumstances, in particular context of their evidence that they were involved in a scheme to smuggle marked oil across the border, it was impossible that they or anyone else had done so.” [37] R v Flook [2010] 1 Cr. App. R. 30, 434; [2009] EWCA Crim. 682. [38] R v Flook, paragraph 37. [39] HKSAR v Cheung Wai [1998] 4 HKC 249 at 255 A-B; affirmed by the Appeal Committee of the Court of Final Appeal [1998] 2 HKLRD 250-1. [40] Littlewoods representing the 1st to 4th applicants and Francis Kong & Company representing the 5th applicant. [41] The letter of the Department of Justice dated 26 April 2012 to Littlewoods explained that “GAC” was an acronym for General Administration of Customs of the People’s Republic of China and that “GSCC” was a sub-administration institution of GAC. [42] Miscellaneous Bundle, pages M 9-12. [43] Miscellaneous Bundle, pages M 14-5. [44] Transcript, page 4 N-Q. [45] Transcript, page 13 P-Q. [46] Transcript, page 14 R-S. [47] Transcript, page 4 Q - page 5 C. [48] Appeal Bundle, page 1905. [49] Appeal Bundle, pages 285-3. [50] Appeal Bundle, page 552. [51] Miscellaneous Bundle, pages M 176-185 (written objections of A1 & A2); Appeal Bundle, pages 1903-1936. [52] Exhibit P 710. [53] Appeal Bundle, pages 197-9. [54] Appeal Bundle, page 348. [55] Appeal Bundle, page 469. [56] Appeal Bundle, page 531. [57] Appeal Bundle, page 587. [58] Appeal Bundle, page 531 (Huang Shunping); 587 (Shi Rubin). [59] Hall v HKSAR (2009) 12 HKCFAR 562 at 564 C-D, paragraph 2. [60] HKSAR v Lee Ming Tee (No. 2) (2003) 6 HKCFAR 562; pages 382-392, paragraphs 142-176. [61] R v Flook [2010] 1 Cr. App. R. 30, 434; [2009] EWCA Crim. 682. [62] R v Flook, page 446, paragraph 32. [63] Op cit, paragraph 33. [64] Op cit, page 448, paragraphs 35-7. [65] Exhibit Bundle, page 1594. [66] Appeal Bundle, page 1930 Q-S. [67] Cross & Tapper, Evidence (12th Edition, page 610). [68] Muirhead, Petitioner, Reports-1983, Scots Law Times pages 545-8. [69] Muirhead, Petitioner,page 548. [70] Miscellaneous Bundle, pages M 184-5. [71] Reasons for Verdict, paragraph 167. [72] Reasons for Verdict, paragraph 169. [73] Reasons for Verdict, paragraph 170. [74] Appeal Bundle, pages 333-9 (Feng Jiu); pages 453-5 (Chen Ruihong); page 526 Cheng Kam Shui; page 526 (Huang Shunping) and pages 582 and 586 (Shi Rubin). [75] Appeal Bundle, page 438. [76] Appeal Bundle, page 446 S. [77] Appeal Bundle, page 447 M. [78] Appeal Bundle, pages 544-5; 549 (Huang Shunping). [79] Appeal Bundle, pages 550-1 (Huang Shunping). [80] Appeal Bundle, page 406 (Feng Jiu accepted that in a statement 25 March 2010 he had referred to Cheng Kam Shui as ‘Lack Chai’ only, deliberately concealing his full name and falsely stating that he did not know his full name); page 534 (Huang Shunping accepted that in his statement off 25 February 2010 he had referred to Cheng Kam Shui only as Lack Chai). [81] Appeal Bundle, page 366 L. [82] Appeal Bundle, page 499. [83] Appeal Bundle, page 564 C-H. [84] Appeal Bundle, page 298 A-E; pages 333-9. [85] Appeal Bundle, page 361 F-K. [86] Appeal Bundle, page 363 F-H. [87] Appeal Bundle, page 363 H-P. [88] Appeal Bundle, page 546 D-E. [89] Appeal Bundle, page 577. [90] Appeal Bundle, page 583 A-D; 585 T - 586 A. [91] Appeal Bundle, page 591 T. [92] Appeal Bundle, page 612 R. [93] Appeal Bundle, page 614 F. [94] Appeal Bundle, pages 429 and 453-5. [95] Appeal Bundle, pages 478 and 480. [96] Reasons for Verdict, paragraph 170. [97] Reasons for Verdict, paragraphs 167 and 170. [98] Appeal Bundle, pages 1272-3. [99] Expert Report, P 711, paragraph 1.3 (ii). [100] Appeal Bundle, page 1304. [101] Reasons for Verdict, paragraphs 142-3. [102] Reasons for Verdict, paragraph 172. [103] Reasons for Verdict, paragraph 175. [104] Reasons for Verdict, paragraph 176. [105] Miscellaneous Bundle, page 273, paragraphs 244-5. [106] Appeal Bundle, page 2340 B. [107] Miscellaneous Bundle, pages 275-6, paragraph 256. [108] Miscellaneous Bundle, page 276. [109] Reasons for Verdict, paragraph 194. [110] Reasons for Verdict, paragraph 191. [111] Reasons for Verdict, paragraph 20. [112] Reasons for Verdict, paragraphs 203-5. [113] HKSAR v Ng Po On,page 106 B-D, paragraph 37. [114] HKSAR v Ng Po On, page 106 F-G, paragraph 37. [115] Tong Yiu Wah (2007) 10 HKCFAR 324: Chan PJ at page 329 G-J, paragraph 10. [116] The Queen v Cheng Kai & Another (HCMA 753 of 1994; unreported, 3 May 1996). [117] HKSAR v Ng Po On, page 106 C-D, paragraph 37. [118] Appeal Bundle, page 419 Q (Chen Ruihong). [119] Appeal Bundle, page 408 (Feng Jiu-modification of fuel tanks); pages 424-5 (Chen Ruihong - about 40 tonnes to107 tonnes) and page 518 (Huang Shunping - 80,000 odd litres to 96,000 litres). [120] Appeal Bundle, page 517 H (Huang Shunping); page 574 H (Shi Rubin). [121] Appeal Bundle, page 301 M-O (Feng Jiu): page 450 N-P (Chen Ruihong). [122] Appeal Bundle, page 513 M-S. [123] Appeal Bundle, pages 429 T - 430 C. [124] The Queen v Cheng Kai; Patrick Chan J, page 5. [125] Churchill v Walton [1967] 2 AC 224. [126] HKSAR v Yung Lai Lai, page 684, paragraphs 64-6. [127] Churchill v Walton, page 237 C-F. [128] Appeal Bundle, Chen Ruihong, page 438; Huang Shunping, page 542 and Shi Rubin, page 579. [129] Appeal Bundle, page 107, paragraphs 203-4. [130] Appeal Bundle, page 187, paragraph 167. [131] Appeal Bundle, page 198, paragraph 206. [132] Reasons for Verdict, paragraph 203. [133] Appeal Bundle, Chen Ruihong, page 431; Huang Shunping, pages 519 and 543 and Shi Rubin, page 578. [134] Reasons for Verdict, paragraph 205. [135] Reasons for Verdict, paragraph 207. [136] Appeal Bundle, page 320 B-C. [137] Expert Report, P 711, paragraphs 9.24-9.25 and E 943. [138] Exhibit P 654. [139] Reasons for Verdict, paragraphs 176 and 215. [140] Expert Report, P 711, paragraph 9.8. [141] Reasons for Verdict, paragraph 215. [142] Reasons for Verdict, paragraphs 211-2. [143] Appeal Bundle, page 1039. [144] Reasons for Verdict, paragraph 216. [145] Reasons for Verdict, paragraph 216. [146] Expert Report, P 711 paragraph 8.4. In his supplementary report the amount of cash deposit by the 4th applicant was revised to $103,802,315 (E 1119). [147] Expert Report, P 711, paragraph 6.32. [148] Reasons for Verdict, paragraph 129. [149] Reasons for Verdict, paragraph 131. [150] Reasons for Verdict, paragraphs 126-7. [151] Exhibit Bundle, P 711, paragraph 5.4. [152] Appeal Bundle, pages 292, 354 and 408. [153] Appeal Bundle, page 423. [154] Appeal Bundle, pages 514 and 543-4. [155] Appeal Bundle, page 569. [156] Exhibit Bundle, P 711, page E 784. [157] Reasons for Verdict, paragraph 7.5. [158] Reasons for Verdict, paragraph 216. [159] Exhibit Bundle, P 676, pages 373-4. [160] Reasons for Verdict, paragraph 138. [161] Exhibit Bundle, P 669 and P 670, pages E 680 - E 772. [162] Reasons for Verdict, paragraphs 136-7. [163] Reasons for Verdict, paragraph 218. [164] Expert Report, P 711, paragraph 6.32. [165] Reasons for Verdict, paragraph 220. [166] Reasons for Verdict, paragraph 221. [167] Reasons for Verdict, paragraph 233. [168] Appeal Bundle, page 1878. [169] Exhibit P 634. [170] Reasons for Verdict, paragraph 237. [171] Reasons for Verdict, paragraph 135. [172] Expert Report, P 711, paragraph 7.17. [173] Reasons for Verdict, paragraph 239. [174] Appeal Bundle, page 447 M. [175] Appeal Bundle, page 448 H-J. [176] Section 83(1)(b) of the Criminal Procedure Ordinance. [177] Launder v HKSAR (2004) 4 HKCFAR 457 at 471 E-G, paragraph 61. [178] Reasons for Verdict, paragraphs 192. [179] Expert Report, paragraph 7.3. [180] Reasons for Verdict, paragraph 225; Reasons for Verdict, paragraph 176. [181] Reasons for Verdict, paragraph 213. [182] Reasons for Verdict, paragraph 213. [183] Reasons for Verdict, paragraphs 230-2. [184] Expert Report, P 711, paragraph 6.16 (2010: January $119,448,622; February $22,209,405; March $30,986,714 and April $117,174,640). Please refer to FAMC56/2014 for the relevant appeal(s) to the Court of Final Appeal. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cases cited in this judgment
Further hearings and rulings under CACC 60/2013