HKSAR v. Hui Rafael Junior , also known as Hui Si-yan Rafael and Others

Subject to reporting restrictions as per paragraph 79 of the judgment

HCCC 98 /2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CRIMINAL CASE NO. 98 OF 2013

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BETWEEN

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REASONS FOR RULING

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1.There were five separate applications made before me after arraignment but prior to the empanelment of the jury. The first three were concerned with D1, the remaining two with D5. All five applications related to the admissibility of evidence proposed to be introduced at trial by the prosecution.

2.The first application concerned the admissibility of (i) a witness statement made by D1 on 13 January 2010; and (ii) a written record of interview under caution with D1 made on 14 November 2011.  The second application concerned the admissibility of the journalistic material which the prosecution intend to produce as part of their case.  The third application related to the admissibility of D1’s tax records which the prosecution also seek to adduce as part of their case.

3.The fourth application concerned the admissibility of the oral statements made by D5 to two ICAC officers, Hazel Law Pui-man (“Hazel Law”) and Bernard Kam Wing-cheong (“Bernard Kam”) on 13 December 2011.  The fifth application concerned the admissibility of two documents seized at D5’s home address on 19 March 2012, namely a document in D5’s handwriting (“the handwritten note”) and two typed documents (“the Part A/Part B documents”).

4.In the event, it became unnecessary for me to give any ruling on the issue engaged by the fourth application.  Having voiced my misgivings about the way certain statements attributed to D5 were recorded, Mr Tse SC for the prosecution and Mr Chan for D5 indicated before final submissions were made on the matter that a ruling would not be necessary since the prosecution have indicated that they will now be limiting the evidence of the two witnesses to certain factual matters concerning the interview of 13 December 2011 which are not disputed.

5.I conducted voir dire proceedings in relation to the first application and a separate voir dire in relation to the fourth and fifth applications, but delayed ruling on each issue of admissibility until all the evidence had been heard.  Since two of the witnesses were common to both D1’s and D5’s voir dires, and since their credibility was in issue, I considered it prudent to reserve judgment until all the evidence had been heard.

6.I shall deal first with my ruling on the voir dire conducted in respect of D1’s witness statement and record of interview.

D1

The admissibility of the witness statement dated 13 January 2010

7.The principal argument engaged as to admissibility concerning D1’s witness statement is whether D1 ought to have been cautioned before his interview with ICAC officers on 22 December 2009, which interview elicited the responses later included in the witness statement signed by D1 on 13 January 2010.  It is submitted by Mr Choy on behalf of D1 that there was a flagrant and deliberate failure on the part of ICAC to caution his client when the ICAC had long regarded, and had sufficient reason to regard D1 as a suspect.  It is argued that D1 was thereby tricked into providing evidence he might not otherwise have provided.  Therefore, there must be a reasonable doubt as to the voluntariness of the witness statement.  Even if voluntary, it is urged that I should exercise my residual discretion to exclude the statement on the grounds of unfairness.

8.It is necessary to set out certain relevant facts by way of background so as to understand the objection.

9.On 18 July 2008, a firm of solicitors (“Firm A”) had written to the ICAC lodging a complaint against D1 on behalf of an unnamed client who had reason to believe that D1 was in breach of the Prevention of Bribery Ordinance, Cap 201 (the POBO) and/or the Mandatory Provident Fund Schemes Ordinance, Cap 485.  It is not necessary for me to set out in full the breaches alleged against D1or the argument advanced by the solicitors concerned, which are contained in Exh VDD4.  Suffice it to say, it was alleged inter alia that D1 had occupied rent-free, at a time when he was both managing director of the Mandatory Provident Fund Schemes Authority (“MPFA”) and later a non-official member of the Executive Council, two identified adjoining units at The Leighton Hill in Happy Valley which belonged to two companies associated with Sun Hung Kai Properties Ltd (“SHK”).  It was alleged that not only had D1 accepted an advantage as a public servant but he had breached various provisions of the Code of Conduct of the MPFA including the acceptance of advantages and the avoidance of conflicts of interest.

10.Almost three months later on 10 October 2008, a different firm of solicitors (“Firm B”) wrote to the ICAC to say that they had replaced Firm A but repeating the allegations made by Firm A and providing what they described as “further information” including certain documents.  Paragraph 2 of the letter from Firm B (Exh VDD5) contains this sentence: “While we respect your earlier decision in this matter, we are of the opinion that there is solid evidence to support a prima facie case of corruption against (D1) as a public servant and/or his wife … as a prescribed officer and/or the relevant senior staff of Sun Hung Kai Properties (“SHKP”) contrary to sections 3, 4(1)(2), 5(1)(2) and/or 8(2) of the (POBO) and certain common law offences relating to public servants” (original emphasis).  Among the documents supplied was a “Service Agreement believed to be signed by (D1)”.

11.Although I have not seen the letter from ICAC which prompted the opening adverbial clause in paragraph 2 of Exh VDD5, it would seem that ICAC had not thought enough of the original complaint by Firm A to pursue it very far.  Whether it was the production of the new documents or the persistence of the complainant and/or persuasiveness of the new solicitors or other material, the ICAC obviously decided to pursue the matter and conduct an investigation.  Thus, by the time of the interview with D1 in December 2009, various staff members of SHK and MPFA had made witness statements which had established certain matters supporting the essential framework of the complaint.  These included the fact that, in early 2003, the administrative committee of MPFA, of which D1 was a member, was considering various options for the leasing of premises; that D1 had voted for a proposal to renew the lease for MFPA’s premises at One IFC; that One IFC was partly owned by SHK; that D1 had begun occupying the units at the Leighton Hill, which were connected with SHK, from March 2003 onwards; and that D1 did not pay any rent for the units from April 2003 to June 2005.

12.On behalf of D1, Mr Choy submits that, since by the time of the interview in December 2009, the ICAC had obtained signed witness statements confirming D1’s rent-free occupation of domestic premises linked to SHK at a time when he was a public official having dealings with SHK, there was in their possession by that time sufficient evidence which would have afforded reasonable grounds for suspecting that he had committed an offence (or offences) so as to warrant his cautioning under Rule II of the Rules and Directions for the Questioning of Suspects and the Taking of Statements (“Rule II”).  Accordingly, by not cautioning D1 when they should have done, ICAC officers embarked upon a deliberate trick to mislead D1 as to the state of their enquiries and to ensure that he would speak and subsequently sign a statement rather than avail himself of his right of silence.

13.The intention to trick and mislead D1 is further said to be evidenced by the fact that the ICAC had repeatedly applied for search warrants on the basis that there was “reasonable cause to believe that offences under section 4 of the Prevention of the POBO might have been committed by (D1) and unidentified member(s) of SHK”: see Exh VDD1, affirmed on 18 March 2009, and Exh VDD2, affirmed on 13 August 2009.  The information in support of each application for a search warrant, was affirmed by Lam Cheung-ching of the ICAC, who was a member of the investigating team as well as present at the interview with D1 of 22 December 2009 and the subsequent interview under caution on 14 November 2011.

14.Had the evidence and other information to which I have just referred been the only material in the possession of ICAC by December 2009, there might have been a persuasive argument in favour of the need for a caution to be administered prior to the interview of D1 by Yu Chun-cheong, Ricky (“Ricky Yu”) and Hazel Law on 22 December 2009.  However, the position when viewed through the eyes of ICAC officers investigating this matter in 2009 was rather more complex and less clear cut.  One must obviously be careful to judge the state of mind of the ICAC, in what was obviously a developing investigation, as the facts presented themselves to the investigators in December 2009, rather than with the benefit of hindsight in 2014.

15.The Service Agreement signed between D1 on behalf of Top Faith Enterprises Limited (“Top Faith”) and D2 on behalf of Sun Hung Kai Real Estate Agency Limited on 1 March 2004 (which has also been referred to in argument as the “consultancy agreement”) made no mention of rental payments in respect of the two Leighton Hill units or any other quarters being provided as part of the agreement.  However, on 14 July 2009, Messrs Mayer Brown JSM (“JSM”) forwarded to the ICAC a copy of a letter of the same date from JSM to the Secretary for Justice attaching two documents: (i) a signed statement of Madam Kwong Siu-hing, the Chairman of SHK, who has also been described as the matriarch of the Kwok family, dated 11 July 2009, and (ii) a Joint Opinion from two Senior Counsel and a junior counsel dated 13 July 2009.  One of the matters which these documents essentially sought to explain was that the management of SHK were at first unable to agree on the question of whether the two Leighton Hill units should be provided to D1 as part of the arrangements under the consultancy agreement.  It was not until 2004 that the matter was finally resolved.  It was asserted that while Top Faith was under a legal liability to pay the rent for both units as from 2003, it was eventually resolved in 2004 to waive rent, by which time D1 was no longer a “public servant”.  Accordingly, no offence was committed.

16.Also on 14 July 2009, ICAC made requests to interview Walter Kwok and D3.  Walter Kwok agreed to be interviewed and was subsequently seen by ICAC officers, although it did not result in any written statement.  D3, on the other hand, declined to be interviewed.  Some time thereafter, D2 was asked by ICAC if he would agree to be interviewed.  He must have consented because on 15 October 2009, D2 attended for interview together with his counsel and solicitor.  However, no written statement was taken on that occasion.  On 29 October 2009, D2’s then instructing solicitor furnished ICAC with a written statement signed by D2 on 28 October.  In the statement, D2 confirmed that the two Leighton Hill units were provided to D1 “as consultant’s quarters” but that they “were totally unrelated to the IFC lease renewal which was a completely separate matter”.

17.Although Ricky Yu said of D2’s statement that “for the first time, it was at that time that we came to know that these two flats that were provided to (D1) as accommodation (were) connected to the terms of the consultancy agreement”, it is clear that he must have known of the contended connection as at the receipt of the JSM letter and submissions on 14 July 2009.  He later clarified in cross-examination that it was not until D2’s statement was provided that confirmation of the connection was obtained from one of the actual signatories to the agreement.

18.So far as the reason for not cautioning D1 is concerned, Ricky Yu explained that the reason he wished to obtain a witness statement from D1 on 22 December 2009 was that:

“… at that time, we were dealing with a very serious allegation. The persons being complained of were the ex-Chief Secretary, the number 2 person in the Hong Kong SAR, and also Sun Hung Kai, a major developer in Hong Kong. We had received various representations, and we had also interviewed the Kwok Brothers, who had made representation on the matter. As a fair and just law enforcement agent, I thought we ought to offer (D1) an opportunity to give comments or representations on the investigation.”

19.As to the method of interview and whether it would be by way of witness statement or statement under caution, he maintained:

“It was a very difficult decision to make. Based on the evidence that we had at that time, and the information gathered from the investigation, we did not have a reasonable reason to suspect that (D1) contravened any offence. So we interviewed him as a witness.”

20.He went on subsequently to explain that not only did ICAC believe “that what D1 said to us was the truth” and that “at that time, we did not have anything to prove that he had said something inaccurate” but that since he “believed that the information provided by (D1) was true and accurate.  Therefore, we did not do any verification”.  Hazel Law expressed similar sentiments, considering that “[a]fter the interview, basically we (were) inclined to believe what (D1) had told us, and we were not anxious to check the information that he provided to us”.

21.I might observe that if the officers really did believe before this interview that they had at that stage sufficient evidence which would have afforded reasonable grounds for suspecting D1 of committing an offence but refrained from cautioning him in order that he would speak when he might not otherwise have done so, they would seem to have rather meekly accepted what they were told.  In my judgment, their reaction after the interview is more consistent with a state of mind falling short of the requirement stipulated in Rule II prior to the interview.

22.It is clear that both officers who gave evidence were acutely conscious of the fact that they were going to be asking questions of an extremely prominent citizen.  Whilst that fact could never justify the raising of the threshold of suspicion to such a level so as to deprive such a citizen of the protection afforded by the caution, which protection might have operated earlier had the citizen been less prominent, it does nevertheless help to explain what each officer actually believed both before and after the interview.

23.ICAC had received an anonymous complaint, the essential framework of which had been confirmed by statements from both MPFA and SHK.  However, they also had in their possession a copy of a consultancy agreement, which on the face of it showed a bona fide business relationship as from March 2004 and which was being strenuously contended, as from July 2009, by SHK, its legal advisers, two Senior Counsel and the equally prominent signatory to the agreement itself, namely D2, to be a perfectly proper business arrangement unconnected with D1’s position as a public officer.  At the same time, it was also being asserted that the decision to waive any rental payments was related to the consultancy arrangement but was made later when D1 was no longer a public officer.

24.Of his own state of mind upon the receipt of D2’s statement of 28 October 2009, Ricky Yu gave what I considered a rather guileless and ingenuous explanation: “Maybe I should put it this way.  We did not believe that Mr Kwok would tell us a lie without any reason.  As far as he said what he said to us, we would take it as the truth.”

25.That is why I say that the matter must have appeared to ICAC, as at December 2009 when the decision to interview D1 was made, to be rather more complex and less clear cut than the anonymous complaint asserted.  Faced with explanations from extremely prominent individuals, which could not be lightly disregarded, it would have been a bold move on ICAC’s part to have arrested or cautioned D1 on the strength of an anonymous complaint, even if the framework of that complaint had been confirmed, without a clearer understanding of the consultancy agreement and its ramifications on the issue.

26.Although a suspect’s prominence or standing in the community might affect the view that an investigating officer actually forms of his complicity in an offence, such a suspect should not be disadvantaged by the fact that the officer consequently raises the threshold of suspicion before he is prepared to arrest or caution a prominent citizen, if objectively there are reasonable grounds for suspicion of his complicity in an offence.  Equally, an investigating officer cannot deliberately close his eyes to the obvious and refuse to arrest or caution a suspect in order that he can continue gathering evidence from him when, on an objective basis, there are reasonable grounds to suspect that he has committed an offence which would justify his arrest and caution.  If, notwithstanding a genuinely held subjective belief on the part of an investigating officer that the threshold at which a caution should be administered has not been reached, there are reasonable grounds to suspect a citizen (prominent or not) of committing an offence on an objective basis, then he should proceed to arrest and caution him.  In this regard, section 10(1) of the Independent Commission Against Corruption Ordinance, Cap 204, by which an authorized officer may arrest “if he reasonably suspects that (a) person is guilty of an offence”, is in pari materia with section 50(1) of the Police Force Ordinance, Cap 232, of which the standard of reasonable suspicion was said by the Court of Final Appeal in Yeung May Wan & Others v HKSAR (2005) 8 HKCFAR 137, at para 82, to be:

“… one requiring the arresting officer to have formed, at the time of arrest, a genuine suspicion of guilt held on grounds which are objectively reasonable. What is needed to meet that standard in any particular case is a question of fact and degree.”

27.Such questions of fact and degree are, however, not always easy to determine.  If three judges of the English Court of Appeal were unable to agree on whether the need for a caution had been triggered on the facts in R v James [1996] Crim LR 650; (Unreported) 8 March 1996 (Court of Appeal), the answer would have been even less obvious to the investigating officers concerned.  However, in considering whether, and if so when, a caution should be administered during an ongoing investigation, the Court in James made two important points, at p 17:

“First this: the concept of reasonable grounds for suspicion is not an absolute one; it is, indeed, singularly imprecise. This is particularly so where, as here, there exists at the relevant time the real possibility that no crime at all has been committed. That clearly complicates the position, enlarging the area of doubt and delaying the point at which logically an investigating officer’s initial uncertainties about an interviewee’s innocence (perhaps even a hunch of his guilt) turn instead into an objectively well-founded suspicion of guilt.

Second, the court must guard against the risk of judging the officers’ evidence unfairly with the benefit of hindsight. By the date of trial the mere passage of time itself had inevitably hardened suspicions, eliminating, as realistically it had, all prospect of an alternative innocent explanation for Martin’s disappearance. By then, moreover, it was known, as at the time of these interviews it was not, that the appellant was never going to offer any remotely plausible explanation for his doings in the late afternoon of 29 December. The disputed interviews, by contrast, took place within a week of Martin’s disappearance, at a time when no overall position presented itself and when, indeed, many crucial evidential findings had still to be made. This was in short a developing situation …”

28.These comments are rather apposite to the present case.  Not only would the consultancy agreement have complicated, and did indeed complicate, the investigating officers’ thinking in relation to the complaint, but the whole process of enquiry was clearly a developing one.

29.It is perhaps appropriate for me to deal here with the argument that if the ICAC investigation team considered that search warrants should be applied for under section 17(1) of the Prevention of Bribery Ordinance, Cap 201 (“POBO”) on 18 March and 13 August 2009 (there was another apparently applied for on 14 May 2009), they must have had reasonable grounds for suspecting that D1 had committed an offence requiring a caution to be administered under Rule II.

30.As I have pointed out, this was a developing enquiry.  In many complex cases, where the investigation takes months if not years, the allegation may not become clear or crystallize for some considerable time, particularly where there are conflicting accounts of what went on and why.  Those tasked with investigating complex cases involving intricate transactions among unknown or apparently unrelated individuals may well go through various states of mind about the case they are investigating from initial scepticism, to an instinctive hunch, to a more reasoned conjecture, to suspicion that an offence might have been committed based on doubtful or equivocal or conflicting information or evidence, to a suspicion or belief that an offence might have been committed based on credible information or evidence, to a firm belief based on credible evidence that an offence has indeed been committed; with various shades of suspicion or belief in between.  One would also hope (as the representations from JSM and D2 presumably hoped) that sometimes investigators change their minds during that process and retreat from a suspicion or belief they might otherwise have formed.

31.During this process of investigation, evidence is obtained to see whether it confirms or advances or dispels suspicion.  Search warrants in order to try and find evidence are instrumental in this process.  Under section 17(1) of the POBO:

“Any investigating officer may, for the purposes of an investigation into, or proceedings relating to, an offence suspected to have been committed under this Ordinance, make an ex parte application to a court for the issue of a warrant under subsection (1A).”

32.Rule II, on the other hand, requires that:

“As soon as (an investigating officer) has evidence which would afford reasonable grounds for suspecting that a person has committed an offence…”,

the officer shall caution that person before putting any questions, or further questions, relating to that offence.

33.It seems to me that the state of mind contemplated by the application for a search warrant is less than the state of mind required for the administering of a caution.  They are not perhaps far apart: but they are nevertheless different. I note interestingly that in both applications for search warrants which have been placed before me (Exh’s VDD1 and VDD2), the affirming officer declared:

“There is reasonable cause to believe that offences under Section 4 of the POBO might have been committed by (D1) and unidentified member(s) of SHK.” (emphasis supplied)

34.He did not affirm that he had evidence which would afford reasonable grounds for suspecting that D1 and others had committed an offence, even accepting one should give a liberal interpretation to the word “evidence”.  In many cases, investigators apply for search warrants in order to find evidence which advances the investigation before any arrests are made.  

35.But even if there were no appreciable or valid distinction between the state of mind which applies for a search warrant and the state of mind at which the administering of a caution is triggered, the fact is that the applications for the search warrants came before D2’s statement of 28 October 2009 was received.  That statement, in conjunction with the earlier representations from SHK, Senior Counsel and JSM clearly affected the way Ricky Yu, in particular, looked at the allegation, even though the initial suspicion may have subsisted.

36.Having heard the evidence in the voir dire, I find as a fact that at the time Ricky Yu and Hazel Law decided to interview D1 and up to the time the resulting statement was signed, they did not themselves believe that the evidence (and information) in their possession was sufficient to afford reasonable grounds for suspecting that he had committed an offence, so as to warrant a caution being administered under Rule II.  Furthermore, I do not consider for the reasons I have given that such evidence (and information) as they had in their possession during the same time frame, including the evidence (and information) which had been supplied by SHK, various lawyers and D2 himself in relation to the consultancy agreement, afforded reasonable grounds on an objective basis for suspecting that D1 had committed an offence so as to warrant a caution being administered.  Accordingly, I do not consider that D1 should have been cautioned either at the commencement of the interview on 22 December 2009, or up to his signing the statement on 13 January 2010.

37.If I am wrong on the question of whether all of the evidence (and information) in ICAC possession (both in support of and against the assertions contained in the anonymous complaint) was sufficient to afford reasonable grounds to suspect D1 of committing an offence when objectively viewed, and that the requirement for a caution had been triggered, whatever Ricky Yu and Hazel Law subjectively thought, I would not have exercised my discretion to exclude the evidence by virtue of the breach of Rule II.

38.I have already described the evolution of this developing investigation, against what Mr Tse termed the “mixed messages” that were being received by ICAC.

39.It is further clear beyond peradventure that when D1 signed the statement on 13 January 2010, he must have been entirely satisfied that the statement properly reflected what he had said and what he wanted to convey at the interview on 22 December 2009.  Not only had Hazel Law made a full note of everything that had transpired but the statement which resulted was sent to D1 for his approval.  He made certain alterations and additions, as a result of which the statement was revised to incorporate his amendments.  When he came up to ICAC offices to sign the revised statement on 13 January, he made yet further amendments before appending his signature to the document.

40.I am therefore entirely satisfied that there is an accurate and reliable record of the interview, incorporating whatever amendments D1 wished to make, before he confirmed that record with his signature three weeks later.

41.As I have just observed, the Court in James was apparently divided as to whether the appellant should have been cautioned before the interview of 5 January (or the third occasion the appellant was seen by the police on day 7 of the police investigation).  By this time, borrowing the analysis in the Criminal Law Review at 651, the police had established that the appellant had earlier told them a pack of lies about his movements on the day in question and the purpose of questioning him was to confront him with a version of events disclosed by a witness which was at variance with his earlier claims.  On this occasion, the appellant produced another story, which subsequently turned out to be yet another lie.

42.Notwithstanding its division on the issue of whether the appellant should have been cautioned, the Court was unanimous in saying that it would not have used its discretion under section 78 of Police and Criminal Evidence Act, 1984 to exclude the interview of 5 January, even if a caution should have been administered.  It held:

“A further major consideration with regard to the exercise of the section 78 discretion here is that, as stated, the accuracy of these interviews has never been disputed, nor is there any question of the police eliciting unreliable confessions; there were, indeed, no confessions at all. We recognise, of course, that this consideration is not determinative: if the accused should have been cautioned and offered a solicitor and wrongly was not, he is entitled to protest of thereby losing the advantage of staying silent instead of further incriminating himself by lies. But such a protest will not invariably prevail.”

43.I would agree that a failure to caution a suspect is a potent factor in favour of the exclusion of a subsequent interview where the interviewee should have been, but was not, cautioned.  Indeed, the absence of a caution may by itself lead to the exclusion of what follows.  But exclusion is not invariable or automatic.  I am quite sure that the record of interview which D1 amended and eventually signed on 13 January 2010 accurately reflected what he wanted to say.  He had three weeks to think about what he had said and yet was still prepared to make further amendments to this statement on the day he signed the statement.

44.I digress for a moment to contrast the position of the use of the residual discretion with the interview of D5.  I do so simply to illustrate how different facts might lead to a different exercise of the discretion in the same case.  The interview of D5 had taken place on 13 December 2011.  No written statement of what had been said at this interview was prepared until 23 October 2013, more than 22 months from the date of the interview, after which it was served as additional evidence on D5; who by then had already been committed to the High Court for trial.  The statement could obviously in those circumstances never have been shown to or signed by D5.  The first he would have seen of the statement and the significance the prosecution attached to it was when it surfaced as additional evidence late last year.  More importantly, what D5 had apparently said at this interview was never put to him when he was formally interviewed by way of video recorded interview on either 19 or 20 March 2012.  That would at least have afforded him the opportunity of saying that he had not said what was alleged or, rather, that he had not said it in the way it was alleged; the latter being Mr Chan’s main complaint.

45.Moreover, the single page of notes kept by Bernard Kam of a one hour interview, from which his witness statement was subsequently made 22 months later, is somewhat rudimentary when compared with the detailed notes of D1’s interview kept by Hazel Law.  Mr Choy was able to point to a few omissions from D1’s witness statement, which I have to say I did not consider of any moment, simply because Hazel Law had kept such detailed notes of the interview.  Whilst my concerns about the interview of D5 could well have engaged the exercise of my residual discretion on the basis of the reliability of the record of what was said at that interview, I have no such concerns about D1’s interview of 22 December 2009, as recorded in his signed statement of 13 January 2010.

46.Returning to the taking of D1’s written statement, I should deal with the question of the alleged trickery by the investigating officers who it is argued deliberately and flagrantly chose not to caution him when they should have done.  The point, which derives from the case of R v Payne [1963] 1 WLR 637 is also relevant to the cautioned statement which I shall deal with shortly.

47.It has been made clear by the Court of Final Appeal in Secretary for Justice v Lam Tat-ming & Another (2000) 3 HKCFAR 168, at 179G-I, that the use of evidence obtained in the circumstances of Payne imperils the principle that no man is to be compelled to incriminate himself; his right of silence should be safeguarded.

48.It has been suggested in argument that Payne is a case of deliberate trickery.  With respect, I do not think that it is so or that the defence need go as far as to suggest deliberate trickery in the Machiavellian sense.  The police officer who told the appellant Payne that a doctor would examine him to see if he was suffering from any illness or disability, and would not be giving his opinion as to his fitness to drive, no doubt did so in good faith pursuant to a policy in existence at the time.  He would have had no idea what would later happen at court when the doctor gave evidence.  Nor is there any suggestion that prosecuting counsel at trial acted in bad faith.

49.I see no reference to deliberate trickery in Payne: indeed, the word ‘trickery’ is not mentioned.  In my view, if evidence which is properly obtained is misused, so that the defendant is effectively, but unintentionally, misled into saying something he would or might not otherwise have said, that could also engage the exclusionary discretion.  Bad faith does not seem to me to be a pre-condition for Payne-type exclusion.  One can mislead in good faith.

50.However, for the reasons I have given, I do not accept that there was any trickery involved in the taking of the statement in either sense of the word.

51.I find beyond reasonable doubt that the witness statement of D1 dated 13 January 2010 was a voluntary statement. Furthermore, I decline to exercise my discretion to exclude it.

The admissibility of the statement under caution of 14 November 2011

52.I can dispose of this matter relatively quickly.  The argument is that by virtue of the way in which the officer, Ricky Yu, structured the interview with D1, he was effectively tricked into confirming his previous witness statement before the details of the allegations were properly explained to him and before Ricky Yu took issue with certain matters referred to in that statement.

53.I wholly reject this somewhat ingenious argument.  Nor do I accept that that was, or might conceivably have been, either the deliberate intention of Ricky Yu or the unwitting effect of what he did in the two senses of trickery I have just discussed.  There is no single, established method for conducting a statement under caution, except that the rights of the person under interrogation must be properly explained at the outset and the Rules and Directions issued by the Secretary for Security should be complied with.  Here, in the presence of a solicitor, the defendant was cautioned in relation to certain specified offences which the officer said he would detail in due course (Q1).  D1 said he understood and made a confirmation to that effect by signing the document.  After establishing that D1 understood various other rights (Q5), the officer said he would be asking questions based on the witness statement D1 had earlier given on 13 January 2010 and asked whether D1 needed “to refer to the contents of (the) statement now before continuing with the interview”(Q8). D1 said there was no need to do so (A8).

54.He was then asked whether he could “confirm that all the contents in the said statement are true” (Q9), to which D1 answered “Yes” (A9).  Thereafter, he remained silent as he had indeed earlier indicated through his lawyer he would do to any questions (Q and A7), save for one or two formal questions as to whether he understood or wished to remain silent to which he made a response.

55.When the record of interview was complete, D1 spent seven minutes reading the record after which he was asked if, having read the record, he had anything to alter, correct or add (Q28).  He was then asked to initial each answer, sign each page and write a concluding caption confirming the accuracy of the record.  These later seemingly inconsequential formalities are not perhaps without significance.  Had D1 wished to qualify his answer confirming the contents of the witness statement at A9, it was still not too late to do so.  Instead, he proceeded to confirm the correctness of A9 by appending his signature to the answer and writing the final caption.

56.The structure of the formal interview under caution of D2 (Exh VDD3) was, as Mr Choy correctly observes, different from D1’s interview.  Mr Choy submits that D1 ought to have been interviewed in the same way as D2.  On the other hand, as Mr Tse also correctly points out, the way in which D3 was formally interviewed under caution (Exh VDP8) was very similar to the way D1 was interviewed.  Yet D3 had made no earlier witness statement.  As I have said, there is no single, unswerving format for conducting an interview under caution.

57.I see nothing whatsoever involuntary about D1’s interview under caution of 14 November 2011.  Nor do I accept any form of trickery as suggested was used during the interview.  I find beyond reasonable doubt that the interview under caution was voluntary.  I further see no reason to exercise my discretion to exclude the evidence.

The admissibility of the press material

58.It is argued on behalf of D1 that the press material sought to be introduced by the prosecution should be excluded as hearsay evidence and that, assuming it has some limited relevance, the sheer volume of material is more prejudicial than probative since it could never be known how the jury will treat the hearsay narration by a newspaper reporter of what somebody else has said.  He submits that what relevance the evidence might have can be reduced to formal admissions under section 65C of the Criminal Procedure Ordinance, Cap 221 without running the risk of prejudicing either the prosecution or D1’s position.  He further argues that those newspaper reports which suggest that D1 was an “extravagant and profligate” person with close ties to SHK are prejudicial and far outweigh their probative value.

59.The fact that Mr Choy is prepared to concede, by way of formal admission, that (i) there were rumours in early March 2005 that D1 one would be appointed Chief Secretary; and (ii) there was speculation around the end of June 2005 that the government would announce D1’s appointment as Chief Secretary on 30 June 2005, suggests to me that he accepts that there is some relevance to this material at least on those bases.

60.Mr Perry submits, however, that the notoriety of certain events reported in the press goes rather further than that.  For example, the widespread concern that D1’s links with SHK might call into question his independence and impartiality as Chief Secretary would, he says, have been well known to D1 and other defendants and could explain, at least in part, some of the events that were taking place contemporaneously and subsequently to disguise D1’s links with SHK and the alleged payments to him.

61.I accept Mr Choy’s submission that the contents of the press reports are hearsay if the purpose of introducing them is to rely on the truth of what they assert.  However, that is not and could not sensibly be the purpose of the prosecution.  Nor in my judgment is there any danger that the jury will see it as such.  The jury will be given explicit instructions as to the relevance of this evidence and how they may use it and how they must not use it.  I do not accept that a jury properly directed runs any risk of misusing such evidence, which is otherwise relevant and admissible for the purpose for which it is tendered.

62.Finally, I do not accept there is any danger that what Mr Choy suggests is unflattering material renders the press material more prejudicial than probative.  With respect, I do not even accept that Mr Choy’s description of “extravagant and profligate” is a fair characterisation of the material in question.  Even if it were, jurors in Hong Kong look beyond these things and do not try cases on press tittle tattle.

63.The evidence of the press material is plainly relevant and admissible, but will be subject to explicit judicial direction in due course as to the use to which the material may be put and how it must not be used.

The application to exclude D1’s tax records

64.It is submitted by Mr Choy that the evidence of D1’s tax records and employer’s return is irrelevant and should be excluded as being more prejudicial than probative.  The basis of the application is that the evidence does not directly or indirectly point to any offence with which D1 is charged.  Therefore, it is said, that the jury might find him guilty of that with which he is charged because he has not paid his taxes.

65.The argument is totally devoid of substance and wholly unrealistic.  Wisely, Mr Choy did not advance oral argument on the matter beyond adopting his written argument.

66.The fact that D1 did not report certain payments goes to the heart of the issue which the jury will have to ask itself on the central counts on the Indictment so far as D1 is concerned.  Were the payments corrupt payments or might they have been legitimate?  The prosecution will be inviting the jury to consider whether the fact that they were not anywhere recorded in the defendant’s tax records helps to show that they were not legitimate payments.

67.The prosecution are plainly entitled to do so and I am surprised this submission was advanced.  The evidence is clearly relevant, probative and admissible and I decline to exclude it.

D5

The application to exclude the handwritten note (Exh VDP29) and the Part A/Part B documents (Exh VDP30)

68.Since I am not required to give a ruling on the first of Mr Chan’s two applications, I turn finally to D5’s application to exclude the evidence of Exh’s VDP29 and VDP30 on the basis that they are protected by legal professional privilege (“LPP”).  It is submitted that since the documents in question were brought into being for the purpose of obtaining legal advice, they are protected by LPP and the prosecution is thereby unable to make any use of them at this trial.

69.I have been taken in the course of very comprehensive submissions from both parties to a substantial body of case law on the issue of waiver of LPP and the law which it is said should apply in Hong Kong.  Much as I would enjoy the intellectual challenge of analysing the authorities on this subject, there is a primary issue I must resolve first; namely, whether as a matter of fact these two documents were or might have been prepared for the purpose of obtaining legal advice.  Only if I find that they were or might have been so prepared does the issue of waiver arise.

70.In examining the factual issue, I should set out certain facts by way of background:

(i)   on 19 March 2012, the documents in question were seized from D5’s home in the presence of D5’s solicitor;

(ii)   on 20 March 2012, during an interview with the ICAC in the presence of his solicitor (Exh VDP16), the two documents were specifically produced and questions asked as to their meaning and contents;

(iii)   on 26 March 2012, D5 was served by ICAC with a copy of the documents seized on 19 March 2012;

(iv)   by 28 February 2013, Exh VDP29 was served by the prosecution on all defendants and the Court as committal evidence (with its certified translation being served on D5’s solicitor on 15 August 2013);

(v)   on 18 March 2013, Exh VDP30 was disclosed in a seizure list served on all parties by the prosecution (thereby becoming available for inspection);

(vi)   on 31 October 2013, the prosecution referred specifically to Exh VDP29 in its written case summary, at paragraph 284;

(vii)  on 9 January 2014, Exh VDP30 was served by the prosecution on all parties and the Court as additional evidence;

(viii)  on 21 January 2014, Exh VDP30 was referred to in open court by prosecuting counsel during submissions;

(ix)   on 13 February 2014, Exh VDP30 was specifically referred to in a pre-trial ruling by the Court;

(x)   on 11 April 2014, the Court was notified for the first time by letter from D5’s solicitors (copied to all parties) that D5 would be objecting to the production and/or use of the two documents in question on the basis that they were covered by LPP.

71.It will be seen from this chronology that the claim that the documents in question were covered by LPP took more than two years to make, notwithstanding that D5 has been represented since his arrest and notwithstanding that his legal representatives have known about the seizure of these documents since 19 March 2012.  Remarkably, the documents were specifically examined during the ICAC interview of 20 March 2012 conducted in the presence of D5’s solicitor.  In particular, at Entries 114 and 116, the officer conducting the interview referred to one part of Exh VDP29 dealing with what was recorded on the document as “legal advice”.  Yet neither then, nor until 11 April 2014, has there been any suggestion from either D5’s solicitor or counsel that the document is covered by LPP.

72.Similarly, between Entries 100 – 112, D5 was specifically asked, again in the presence of his solicitor, about the entries on Exh VDP30.  Again there was no demur or issue raised by any lawyer until 11 April 2014, notwithstanding the significance that has been attached to this document by the prosecution in open court and by myself in my judgment of 13 February 2014.

73.I readily accept that a lay client may not himself see the significance or importance of LPP, but I cannot accept that a solicitor would have sat through an interview, in which a document with the words “legal advice” was specifically used to confront his client, without raising the matter with his client at the time in interview or immediately thereafter.  Even if that solicitor was succeeded by another, no legal practitioner coming into the papers in this case could conceivably have allowed a matter which is so obvious to be ignored for so long, if indeed there were the slightest hint that the documents might be covered by LPP.

74.Nor can I accept, if Exh VDP30 was shown by D5 to his solicitor at the Dynasty Club coffee shop meeting on 17 March 2012 for the purpose of legal advice, that the solicitor, who did not give evidence, would not have gone on high alert when that same document was produced by an ICAC officer at the interview with D5 three days later, on 20 March 2012.  Yet nothing was ever said or done about it by any solicitor until 11 April 2014.

75.It is true that errors do get made and I would be anxious not to hold such a mistake as not claiming LPP against the interests of a defendant, if I thought there was a possibility that a genuine mistake or misunderstanding might have occurred.  However, solicitors in Hong Kong are highly sensitive and rightly so to one of the very foundations of legal practice in this territory, namely the privilege that attaches to their dealings with their clients.  I cannot conceive in this particular case that any solicitor could have overlooked this matter for two years during which time the documents have been disclosed, commented upon in open court and incorporated (at least so far as one of them is concerned) in a legal judgment, if in truth there was the slightest possibility of the documents being covered by LPP.

76.I regret to say that I must unequivocally reject D5’s evidence that these two documents were prepared or used for the purpose of legal advice.  The chronology to which I have referred is rather devastating evidence that the documents never were what it is now belatedly asserted they are.

77.Accordingly, I find as a fact beyond reasonable doubt that the documents in question are not covered by LPP and can be adduced and referred to at this trial.

78.The rather interesting issues of waiver and partial waiver, therefore, simply do not arise and it is otiose for me to say how I would decide them.

Reporting restriction

79.The content of this judgment including my ruling may not be reported until the conclusion of the trial or further Order.

Mr David Perry QC, Mr Joseph Tse SC, Mr Louis Mably, Ms Maggie Wong, Counsel on fiat, Ms Winnie Ho SADPP & Ms Betty Fu SPP, Mr Carter Chim PP, for the Director of Public Prosecutions

Mr Edwin Choy, instructed by Tang, Lai & Leung, for the 1^st defendant

Ms Clare Montgomery QC, Mr Lawrence Lok SC and Mr Benson Tsoi, instructed by Boase, Cohen & Collins, for the 2^nd defendant

Mr John Kelsey-Fry QC, Mr Gerard McCoy SC and Mr Steven Kwan, instructed by Sit, Fung, Kwong & Shum, for the 3^rd defendant

Mr Ian Winter QC, Mr Daniel Marash SC, Mr Bernard Chung and Mr Adrian Wong, instructed by Tsang, Chan & Wong, for the 4^th defendant

Mr Charles J Chan and Mr Billy Kwan, instructed by Chan & Tsu, for the 5^th defendant