HCAL1060/2017 SINO BRIGHT ENTERPRISES CO., LTD v. SECRETARY FOR JUSTICE - LawHero
HCAL1060/2017
高等法院（行政）Wilson Chan J28/11/2019[2019] HKCFI 2882
HCAL1060/2017
A A
HCAL 1060/2017
B [2019] HKCFI 2882 B
C IN THE HIGH COURT OF THE C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D COURT OF FIRST INSTANCE D
CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST
E E
NO 1060 OF 2017
F ___________________ F
BETWEEN
G G
SINO BRIGHT ENTERPRISES CO., LTD. Applicant
H H
and
I I
SECRETARY FOR JUSTICE Respondent
J J
st
FOK HEI YU, VINCENT 1 Interested Party
K K
nd
RODERICK JOHN SUTTON 2 Interested Party
L L
___________________
M M
N Before: Hon Wilson Chan J in Court N
Date of Hearing: 4 July 2019
O O
Date of Judgment: 29 November 2019
P P
Q Q
JUDGMENT
R R
S S
T T
U U
V V
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A A
B B
A. INTRODUCTION
C C
1. This is the applicant’s application for judicial review to
D challenge the decision of the then Secretary for Justice (“SJ”) on 20 D
October 2017 (the “Decision”), in which he decided not to prosecute the
E E
former provisional liquidators of the Grande Holdings Limited
F (“Grande”), namely Mr Fok Hei-yu Vincent (the “1st interested party”) F
and Mr Roderick John Sutton (the “2nd interested party”), in relation to
G G
two counts of agent soliciting an advantage, contrary to section 9(1) of
H the Prevention of Bribery Ordinance, Cap 201 (“POBO”), and one count H
of blackmail, contrary to section 23 of the Theft Ordinance, Cap 210.
I I
J 2. Leave to apply for judicial review was granted on the papers J
by Li J on 29 March 2018.
K K
B. THE APPLICANT’S CASE
L L
3. According to the Originating Summons (Form 86A) dated 9
M M
April 2018, the applicant seeks, inter alia, the following relief: –
N N
(1) an order of certiorari to quash the Decision;
O (2) further or alternatively, a declaration that the SJ’s failure to O
give adequate reasons for the Decision rendered it unlawful
P P
and void;
Q Q
(3) an order of mandamus to direct the SJ to reconsider the
R Decision in accordance with the law and to provide adequate R
reasons for it;
S S
(4) further or other relief; and
T T
(5) an order for costs.
U U
V V
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B B
4. The applicant’s principal bases for challenging the Decision
C are as follows: – C
D
(1) the Decision is amenable to judicial review because the SJ D
has failed to act in accordance with the Prosecution Code
E E
and failed to provide reasons for the Decision;
F (2) the 3 grounds for judicial review are: – F
G (a) the SJ has failed to provide adequate reasons to G
support the Decision (Ground 1);
H H
(b) the Decision is irrational, if not perverse (Ground 2);
I I
and
J (c) the SJ has failed to act in accordance with the J
Prosecution Code, which rendered the Decision illegal
K K
(Ground 3).
L L
C. SUMMARY OF THE RESPONDENT’S POSITION
M M
5. In summary, the respondent submits that this is a clear case
N N
where the application for judicial review should be refused for the
O following reasons: – O
P (1) a judicial review of a prosecutorial decision is rare and P
exceptional and hence “truly exceptional circumstances”
Q Q
must exist to justify judicial intervention. Judicial
R intervention is justified only where it can be shown that the R
SJ has acted outside “the limits of his constitutional power”.
S S
The requirement is not satisfied in this case. The
T T
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B B
application for judicial review should be refused on this
C ground alone; and C
D
(2) in any event, the applicant has failed to establish a case for D
judicial review, in particular: –
E E
(a) the SJ is not required to provide reasons for the
F decision not to prosecute. This is entirely consistent F
with the general practice recognised by the courts in
G G
Hong Kong and other common law jurisdictions.
H H
Circumstances of this case do not support a departure
I
from the general practice. Even if reasons are I
offered, they should be in very general terms;
J J
(b) the Decision is a rational one. The Advising Counsel,
K Ms Ng Shuk-kuen, Senior Public Prosecutor (“Ms K
Ng”) made the decision not to prosecute based on the
L L
evidence available before her, and with due
M consideration of the legal opinions rendered by Senior M
Counsel retained by the applicant. The conclusion
N N
st
that there is insufficient evidence to prosecute the 1
O and 2nd interested parties for any offence is a correct O
one; and
P P
(c) the Decision is a legal one. In accordance with the
Q Q
Prosecution Code (2013), Ms Ng assessed the
R sufficiency of evidence and rightly concluded that R
there was no reasonable prospect of conviction based
S S
on the available evidence.
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D. THE DECISION
C C
6. The Decision involves 3 alleged offences (collectively, the
D “Alleged Offences”) which occurred on the following occasions during D
the course of Grande’s liquidation: –
E E
st
(1) The 1 Alleged Offence took place on or around 30 April
F F
2014 when the 1st and 2nd interested parties, as Grande’s joint
G and several provisional liquidators, via their legal G
representative Mr Timothy Peter Kentish (“Kentish”) of
H H
Messrs Lipman Karas, solicited for an advantage in a draft
I restructuring agreement exchanged between the provisional I
liquidators and the applicant (the “Draft Agreement”).
J J
The Draft Agreement contained a Clause 2.2.7 which
K solicited for, inter alia: – K
(a) The applicant’s support and/or procurement of support
L L
for the appointment of the provisional liquidators as
M official liquidators of Grande; and M
N (b) The applicant’s consent to an order for the dismissal N
of a personal action (HCA 92/2014) against FTI
O O
Consulting (Hong Kong) Limited (“FTI”) and the 1st
P interested party. P
Q (collectively, the “Advantages”). Q
R
(2) The 2nd Alleged Offence occurred on 22 May 2014 during a R
st
meeting between the 1 interested party and representatives
S S
of the applicant and McVitie Group Holdings Limited
T
(“McVitie”) at FTI’s office at Level 22, The Center, 99 T
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A A
B B
Queen’s Road Central, Central, Hong Kong (the “Meeting”).
C At the Meeting, the 1st interested party, acting on behalf of C
himself and the 2nd interested party, solicited once again for
D D
the Advantages by saying: –
E E
(a) If support from the applicant and McVitie for the
F appointment of the 1st and 2nd interested parties as F
Grande’s official liquidators is forthcoming, and if the
G G
applicant would stay the civil action no HCA 92/2014
H against the 1st interested party and FTI personally, then H
the provisional liquidators would not only review the
I I
proof of debts (“PODs”) of the applicant and the two
J other companies which were previously objected to on J
an earlier occasion, but would also “build in the
K K
necessary commercial arrangements” so that the same
L PODs previously objected to could be admitted for the L
purpose of Grande’s restructuring scheme; and
M M
(b) If the applicant does not accede to the provisional
N liquidators’ request as solicited, Grande’s restructuring N
process would be “back to square one” whereby
O O
Grande will return to normal liquidation, the
P provisional liquidators would not agree to the P
Q
applicant’s proposed self-rescue plan, and the Q
applicant would be expected to suffer financially.
R R
(3) The 3rd Alleged Offence took place on 23 May 2014 during a
S telephone conversation between the 1st interested party, S
acting on behalf of himself and the 2nd interested party, and
T T
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Mr Ian Grant Robinson (“Robinson”) of the applicant (the
C “Call”). During the Call: – C
D
(a) The 1st interested party demanded for the applicant’s D
nd
support towards the appointment of him and the 2
E E
interested party as Grande’s official liquidators with
F express menaces, by stating that the absence of F
support from the applicant, McVitie and/or Gain
G G
Alpha would “… make the whole things very ugly…”
H and would amount to a “deal breaker” for any H
proposals put forth by the applicant for the benefit of
I I
Grande’s restructuring; and
J (b) The 1st interested party also asked that the personal J
action against him be “preferably withdrawal” or
K K
stayed.
L L
E. FACTUAL BACKGROUND
M M
E1. Background of winding-up proceedings for Grande
N N
7. The applicant is a major creditor of Grande and presented a
O O
winding up petition on 30 May 2011. Since then, trading of Grande’s
P shares was suspended on the Hong Kong Stock Exchange (“HKSE”). P
Q Q
8. The interested parties were appointed as the joint and several
R liquidators of Grande on 31 May 2011 by an order of the High Court. R
On 31 March 2012, the interested parties submitted a resumption
S S
proposal to the HKSE. The proposal was, however, rejected and Grande
T was placed in the second stage of delisting by the HKSE. T
U U
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B B
9. A second proposal was submitted but it was also rejected by
C the HKSE on 28 June 2013. As a result, Grande was placed in the third C
stage of the HKSE’s de-listing procedures and was given until 24
D D
December 2013 to submit a viable proposal for the resumption in trading
E of the shares. E
F F
10. On 12 September 2013, DHCJ Le Pichon made a
G winding-up order against Grande. G
H 11. From then on, the interested parties and the applicant H
engaged in a series of long and often hostile negotiations in relation to
I I
restructuring proposals for Grande. The relevant background has been
J set out in the affidavits filed by Mr Kentish and the 1st interested party in J
the winding-up proceedings:
K K
(1) From October 2013, the applicant pressed the interested
L L
parties to engage in the Self-Rescue Plan. The interested
M parties, however, did not consider the aforesaid Self-Rescue M
Plan to be in the best interests of Grande’s general body of
N N
creditors, as it failed to provide creditors with the option of a
O cash dividend. Further, a body of creditors (known as the O
“Kayne Creditors”) would not support a resumption
P P
proposal without a substantial cash dividend.
Q Q
(2) On 10 December 2013, the applicant issued summons
R seeking orders to compel the interested parties to submit the R
Self-Rescue Plan. In addition, the Kayne Creditors also
S S
assigned their claim in the winding up to McVitie, another
T creditor of Grande. T
U U
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B B
(3) Given that (i) there was no viable alternative proposal;
C (ii) Kayne Creditors had assigned their claim against Grande C
to McVitie; (iii) the applicant’s indication that it would meet
D D
the costs of the Self-Rescue Plan, the interested parties
E agreed to submit the proposal to the HKSE on 16 December E
2013.
F F
(4) On 15 January 2014, the applicant commenced a civil action
G G
under HCA 92/2014 against the 1st interested party and FTI
H personally for damages and for loss it allegedly suffered as a H
result of the 1st interested party and/or FTI’s
I I
misrepresentation and false advice prior to the appointment
J of the interested parties. J
K (5) The interested parties had, since January 2014, sought for the K
payment of their fees and expenses in relation to the
L L
preparation of the Self-Rescue Plan. However, despite a
M series of ultimatums to Messrs K&L Gates (“K&L Gates”), M
solicitors for the applicant both in these proceedings and in
N N
the winding-up proceedings, no positive response from the
O applicant was given. This gave rise to concerns because if O
the resumption proposal were to continue, the costs of the
P P
proposal would need to be met out of the assets of Grande.
Q Q
(6) A further ultimatum was issued on 5 March 2014 to K&L
R Gates that unless the resumption proposal was improved by R
10 March 2014 with the inclusion of a cash dividend, it
S S
would be withdrawn by the interested parties.
T T
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B B
(7) Thereafter, on 12 March 2014, an urgent application was
C made by the applicant for orders that the interested parties do C
not withdraw the resumption proposal. At the hearing on
D D
the same day, the applicant undertook to meet the costs of
E the resumption proposal going forward and to pay HK$ 5 E
million into court as security for the undertaking. Upon the
F F
provision of the undertaking, the interested parties agreed
G not to withdraw the resumption proposal for the time being. G
H (8) The 1st Creditors’ meeting was then held on 14 March 2014. H
At the meeting, the applicant, McVitie and Gain Alpha were
I I
against the appointment of the interested parties as Grande’s
J official liquidators. However, the independent creditors J
voted for the 1st and 2nd interested parties to remain in office.
K K
(9) The applicant, McVitie and Gain Alpha are all associated
L L
parties of Mr Ho Wing On (former chairman and director of
M Grande), against whom the interested parties had filed a M
protective writ on behalf of Grande for proceedings alleging,
N N
inter alia, stripping assets from the company through 14
O separate transactions. O
P 12. Thereafter, from March 2014 the interested parties and the P
applicant continued negotiations in attempt to reach a restructure
Q Q
agreement based on the applicant’s resumption proposal. In addition,
R R
the HKSE informed the interested parties that it required a restructure
S
agreement to be entered between Grande and the applicant by the end of S
April 2014. It was the events after April 2014 that led to the applicant’s
T T
present allegations against the interested parties.
U U
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E2. Events leading to the Alleged Offences
C C
13. In short, the applicant claims that the interested parties had
D committed the following offences in the course of their negotiations with D
the applicant in relation to the restructure agreement:
E E
(1) Two counts of soliciting for an advantage contrary to section
F F
9(1) of the POBO.
G (2) One count of blackmail contrary to section 23 of the Theft G
Ordinance.
H H
I 14. The relevant factual background for each of the Alleged I
Offence is set out below.
J J
K E2a. First alleged solicitation of advantage K
L 15. On 29 April 2014, the 1st interested party informed Mr L
Kentish that, as previously requested, the applicant was willing to provide
M M
a cash dividend to creditors. Although the amount was not considered
N to be sufficient by the 1st interested party, it appeared to Mr Kentish that N
the parties were close to reaching an agreement. Mr Kentish then sent
O O
an email to the 1st interested party highlighting further matters which
P should desirably be addressed in the proposed restructure agreement (“29 P
April 2014 Email”).
Q Q
16. The issues mentioned in the 29 April 2014 Email include:
R R
(i) the applicant and others withdraw their opposition to the appointment
S S
of the interested parties; (ii) the action by the applicant against the 1st
T
interested party and FTI be withdrawn (“Relevant Proposals”). T
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A A
B B
According to Mr Kentish, the rationale behind the email was that it would
C be in the interests of all parties for the various outstanding disputes to be C
resolved and further costs avoided.
D D
E
17. Significantly, the rationale for (i) and (ii) above were: E
(1) For (i), it was considered that there were strong reasons for
F F
the court to disregard the votes cast by creditors associated
G with Mr Ho (ie the applicant, McVitie and Grand Alpha), G
and it was very likely that the 1st and 2nd interested parties
H H
would be appointed as liquidators of Grande in spite of their
I opposition. If the applicant’s camp could withdraw their I
opposition, substantial costs could be saved.
J J
(2) For (ii), given that HCA 92/2014 was essentially a complaint
K K
against the conduct of the interested parties as provisional
L liquidators of Grande, and the proceedings would have to be L
discontinued if the applicant’s resumption proposal was
M M
approved by the HKSE and creditors to enable the interested
N parties to be released. N
O O
18. The overarching concern was that of costs in relation to each
P of the above, which was apparently a concern shared by the applicant. P
Q 19. Thereafter on 30 April 2014, Mr Chiang of the applicant Q
informed the 1st interested party that the applicant was willing to increase
R R
the amount of cash dividend. As a result, a revised draft restructuring
S S
agreement was prepared and circulated amongst the relevant parties.
T
The covering email of the draft agreement by the 1st interested party T
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expressly stated that the draft was provided “on a without prejudice basis
C for the purpose of further advancing negotiations.” (“30 April 2014 C
Email”).
D D
E
20. The draft agreement contained, inter alia, the Relevant E
Proposals in clause 2.2.7 referred to in paragraph 6(1) above:
F F
(1) The applicant do take “all steps necessary to support the
G appointment of the Provisional Liquidators as Liquidators of G
the Company…”, including to procure McVitie and Gain
H H
Alpha to also support the appointment of the interested
I parties as liquidators of Grande (Clause 2.2.7 (c)); I
J (2) The applicant consent to orders for the dismissal of J
HCA 92/2014 with no order as to costs (Clause 2.2.7(f)).
K K
L 21. The applicant now contends that the email attaching the draft L
agreement on 30 April 2014 amounted to a solicitation of advantage by
M M
an agent contrary to section 9(1) of the POBO: see Lawrence Lok SC’s
N legal opinion dated 22 May 2017 (“Mr Lok SC Opinion”). N
O 22. On 2 May 2014, a revised restructuring agreement was O
signed with clause 2.2.7 removed and replaced with a new clause 2.4,
P P
which required the parties to negotiate and resolve the outstanding legal
Q actions within a period of 4 weeks instead of contesting them Q
unnecessarily to the detriment of Grande (“Executed Agreement”).
R R
S S
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A A
B B
E2b. Second alleged solicitation of advantage
C C
23. The second alleged offence arose from the Meeting amongst,
D inter alios, Mr Robinson and Mr Chiang for the applicant and the 1st D
interested party at FTI’s offices.
E E
F 24. The applicant claims that the 1st interested party had solicited F
again for (i) support for the appointment of the interested parties as
G G
Grande’s official liquidators; and (ii) a stay of HCA 92/2014. The
H solicitation was allegedly made in exchange for the interested parties to H
review the proof of debts of the applicant, McVitie and Gain Alpha
I I
previously objected to at the 1st Creditors’ Meeting and to admit the same
J for the purpose of Grande’s restructuring scheme. J
K E2c. Alleged blackmail K
L 25. The alleged blackmail took place during the Call between the L
1st interested party and Mr Robinson on behalf of the applicant on 23
M M
st
May 2014. It is alleged that the 1 interested party had made
N unwarranted “threats” to the applicant, McVitie and Gain Alpha in order N
to gain their support of the interested parties’ appointment as liquidators
O O
of Grande.
P P
F. DISCUSSION
Q Q
F1. The Decision is not amenable to Judicial Review
R R
26. The starting point is that a prosecutorial decision of the SJ is
S S
generally not amenable to judicial review. Prior to the handover in 1997,
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judicial review had little, if any, role to play in relation to prosecutorial
C decisions. C
D D
27. In Keung Siu-wah v Attorney General [1990] 2 HKLR 238,
E
the Court of Appeal expressed the view that it was a “constitutional E
imperative” that the courts would not interfere with the Attorney
F F
General’s prosecutorial discretion and a decision to prosecute or not to
G prosecute was not amenable to judicial review. Fuad VP, with whom G
the other judges agreed, stated at p 253B-D that, “I entertain no doubt
H H
whatever that the decision to prosecute in the instant case, likewise, is not
I subject to the judicial review process; such a decision does not fall within I
the criteria for a reviewable decision stated by Lord Diplock in Council
J J
of Civil Service Unions at pp.408-409. Only the Attorney General has
K access to all the necessary information. The cases stress (e.g. Chief K
Constable of North Wales Police v Evans [1982] 1 WLR 1155, 1173) that
L L
judicial review is concerned with reviewing, not the merits of the decision
M in respect of which the application for judicial review is made, but the M
decision-making process itself. In the case of a decision by the Attorney
N N
General to institute a prosecution how is this review to be conducted?”
O and “I can imagine few subjects less adapted to the judicial review O
procedure under O.53 than the exercise of the Attorney General's
P P
discretion in deciding whether to institute criminal proceedings and what
Q charge should be preferred”. Q
R R
28. See also the observation of Penlington JA at pp 255J-256A
S
that “… the authorities are overwhelming that the decision of the S
Attorney General whether or not to prosecute in any particular case is
T T
not subject to judicial review”.
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A A
B B
29. Following the handover in 1997, Article 63 of the Basic Law
C (“BL63”) is the bulwark of prosecutorial independence. It provides that, C
“The Department of Justice of the Hong Kong Special Administrative
D D
Region shall control criminal prosecutions, free from any interference”.
E E
30. The control in criminal prosecutions of course encompasses
F F
the making of prosecutorial decisions of whether or not to prosecute.
G This prerogative is also underpinned in section 15(1) of the Criminal G
Procedure Ordinance, Cap 221.
H H
31. In Kwan Sun-chu Pearl v Department of Justice HCAL
I I
56/2005, Hartmann J (as he then was) refused leave to judicially review a
J decision not to prosecute based principally on Keung Siu-wah, ibid. J
Furthermore, His Lordship held that absent any dishonesty, bad faith or
K K
some other exceptional circumstances, judicial review would not be
L available, even taking into account the development of the law since L
Keung Siu-wah (§§13-16). On the evidence, His Lordship could not
M M
“find any grounds for suggesting that the Department of Justice came to a
N plainly wrong decision not to prosecute; that is, a decision which is N
unreasonable in law” (§10).
O O
P 32. On appeal in Kwan Sun-chu Pearl v Department of Justice P
[2006] 3 HKC 207, the Court of Appeal affirmed Hartmann J’s decision
Q Q
and reasoning. At §7, Tang JA (as he then was) expressed his
R agreement with Hartmann J’s decision and went on to say that “Whether R
Keung Siu Wah v Attorney General precludes judicial review in relation
S S
to the decision of the Department of Justice not to prosecute whatever the
T circumstances is an open question so far as the Court of Final Appeal is T
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concerned and it may be that despite Young v Bristol Aeroplane Co Ltd
C [1944] KB 718 CA, the matter is open to review by this court”. C
D D
33. Then came the landmark case of RV v Director of
E
Immigration [2008] 4 HKLRD 529, where Hartmann J qualified Keung E
Siu-wah and held that the SJ’s control of criminal prosecutions is a
F F
constitutional power and must therefore be exercised within constitutional
G limits. On a true construction of the Basic Law, the courts have G
jurisdiction to judicially review the SJ’s power to control criminal
H H
prosecutions and to determine whether or not he had acted within the
I limits of his constitutional power. That was not considered a defiance of I
the binding pre-1997 precedent of Keung Siu-wah but the recognition of a
J J
new constitutional order under the Basic Law. See §§55-70.
K K
34. At §§71-75 of RV, Hartmann J identified three circumstances
L under which “judicial encroachment” is called for, viz (1) where the SJ L
acts in obedience to a political instruction (§71); (2) where the SJ acts in
M M
bad faith, for example, if one of his officers instituted a prosecution in
N return for payment of a bribe (§72); or (3) where there is a rigid fettering N
of discretion, for example, a refusal to prosecute a specific class of
O O
offences detailed in a statute lawfully brought into law (§73).
P Importantly, His Lordship emphasized that the role of the SJ must not be P
reduced to “that of an ordinary administrator” and that the circumstances
Q Q
justifying judicial encroachment “must be truly exceptional and must
R R
demonstrate that the Secretary has acted outside of his very broad
S
powers” (§74). S
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B B
35. In this regard, the Court of Appeal’s judgment in Re C (A
C Bankrupt) [2006] 4 HKC 582 is pertinent. At §20, Stock JA (as he then C
was) observed in the leading judgment that “I apprehend that it is to such
D D
interference, that is to say, interference of a political kind, to which Art
E 63 is directed. But the rule that ensures the Secretary’s independence in E
his prosecutorial function necessarily extends to preclude judicial
F F
interference, subject only to issues of abuse of the court’s process and,
G possibly, judicial review of decisions taken in bad faith”. (emphasis G
supplied).
H H
I 36. The decision in RV was expressly adopted by the Court of I
Appeal in Re Leung Lai Fun [2018] HKLRD 523. At paragraph 10, the
J J
court held as follows: –
K “10. Article 63 of the Basic Law provides that ‘The K
Department of Justice shall control criminal prosecutions, free
L from any interference’. As Hartmann J had pointed out in RV L
v Director of Immigration [2008] 4 HKLRD 529, this provision
includes the protection of the independence of the Department
M of Justice’s control of criminal prosecutions from judicial M
encroachment. It is only if the case belongs to those
extremely rare situations, such as where there is evidence
N N
proving that the Department of Justice has acted in obedience
to political instruction when making the decision, or is acting in
O bad faith, such as to cause the Court to find that the O
prosecutorial decision is unconstitutional, that the Court will
have jurisdiction to review the decision concerned. Otherwise
P the Court should not encroach on the right of the Department of P
Justice to control prosecutions. This is the major premise
Q which is founded on principle.” (emphasis supplied) Q
R 37. As noted by Chow J in Kwok Cheuk Kin v Secretary for R
Justice [2019] HKCFI 2215, handed down on 6 September 2019, Re
S S
Leung Lai Fun is the latest judicial guidance from the Court of Appeal on
T the issue of the amenability of the Secretary for Justice’s prosecutorial T
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decisions to judicial review. It can also be noted that Re Leung Lai Fun
C is a case which involved a decision not to prosecute. C
D D
38. As submitted by the respondent, although the “truly
E
exceptional” circumstances Hartmann J referred to in RV are not stated to E
be exhaustive, its ambit must be narrowly confined. Classic judicial
F F
review grounds such as irrationality and illegality cannot, without more,
G constitute “truly exceptional” circumstances which warrant a judicial G
review of a prosecutorial decision, or else the SJ’s role would effectively
H H
be reduced to “that of an ordinary administrator”.
I I
39. Prior to the instant case, the only case in which leave was
J granted to commence judicial review against a decision not to prosecute J
is D v Director of Public Prosecutions [2015] 4 HKLRD 62. There the
K K
prosecutorial decision was challenged primarily on the basis that the
L Director of Public Prosecutions had misunderstood or misapplied the test L
for recklessness and thus reached a clearly wrong decision.
M M
N 40. However, the decision in D does not in any way alter the N
position that a decision not to prosecute is generally not amenable to
O O
judicial review, save and except in limited and “truly exceptional”
P circumstances. In Re Leung Lai Fun, Supra, the Court of Appeal, after P
referring to the principles in RV, observed that: –
Q Q
“11. As regards the case cited by Ms Leung, D v Director of
R Public Prosecutions [2015] 4 HKLRD 62 that judgment did not R
raise any legal concept inconsistent with the principle
mentioned above. In that case, the Judge took into account
S the particular circumstances of the case and took the view that S
the applicant's case was reasonably arguable. That was the
T Judge’s preliminary view and there was no further development T
U U
V V
- 20 -
A A
B B
of the case. In any event, the decision is not binding upon this
Court.”
C C
41. The exercise of judicial restraint when reviewing
D D
prosecutorial decisions by the public authorities is shared across common
E law jurisdictions: See in Canada, Krieger v Law Society of Alberta 2002 E
SCC 65 at §§32, 47; in Singapore, Yong Vui Kong v Public Prosecutor
F F
[2012] 2 SLR 872 at §17; in Fiji, Matalulu and Another v Director of
G Prosecutions [2003] 2 HKC 457; in Mauritius (held by the Privy Council), G
Mohit v Director of Public Prosecutions of Mauritius [2006] UKPC 20 at
H H
§§17, 21.
I I
42. As such, the applicant’s reliance on the English authorities is
J J
misconceived. In particular, the applicant omitted the Court of Appeal’s
K clear statement of principle in Re Leung Lai Fun, and invites this court to K
effectively conduct an extensive review of the merits of the underlying
L L
evidence in deciding that the Decision was perverse or irrational.
M I agree that this approach essentially relegates the SJ’s decision to that of M
an ordinary administrator, as cautioned against by Hartmann J in RV.
N N
43. Applying the principles enunciated in the Hong Kong cases
O O
cited above, it is abundantly clear that the instant application does not
P involve any “truly exceptional circumstances” so that the SJ’s P
prosecutorial decision is vitiated on constitutional grounds.
Q Q
R 44. As submitted by the respondent, it is pertinent to note that R
the applicant has not suggested that in reaching the Decision, the SJ or the
S S
Advising Counsel Ms Ng was acting in obedience to any political
T instruction or in bad faith. Nor has it been suggested that there was any T
U U
V V
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A A
B B
rigid fettering of prosecutorial discretion. The applicant’s contention
C that the Decision was plainly wrong and contrary to the evidence does not C
and cannot bring the Decision within the narrow class of prosecutorial
D D
decisions that the court may judicially review. In truth, the applicant
E can at best argue that there may on one view be sufficient evidence to E
prosecute the 1st and 2nd interested parties. As can be seen in Re Leung
F F
Lai Fun, such an “error of law”, even if established, does not render the
G Decision judicially reviewable. G
H H
45. I agree that the instant application for judicial review should
I be dismissed on this ground alone. I
J 46. In this regard, the applicant has submitted that a distinction J
should be drawn between a decision to prosecute and a decision not to
K K
prosecute. The applicant says this is because judicial review is the only
L means by which a citizen can seek redress against a decision not to L
prosecute.
M M
N 47. Whilst this distinction has been drawn in some previous N
decisions, in my view, it cannot override the statement of principle in RV
O O
and Re Leung Lai Fun that the prosecutorial decision has to be
P “unconstitutional” before the court will have “jurisdiction” to review the P
decision concerned (see paragraph 36 above). In this regard, as already
Q Q
noted above, Re Leung Lai Fun itself was a case where the Director of
R Public Prosecutions had decided not to prosecute. R
S S
T T
U U
V V
- 22 -
A A
B B
F2. No valid case for Judicial Review
C C
48. In any event, I agree that none of the 3 grounds for judicial
D review put forward by the applicant has any merit. D
E E
Ground 1 – Duty to give adequate reasons
F F
49. In its skeleton submissions at paragraph 16, the applicant
G properly “concedes that Ground 1 is now theoretical, as reasons for the G
Decision have been disclosed pursuant to the Affirmation of Ms Ng dated
H H
4 June 2018”. Given the academic nature of the matter, no relief should
I be granted. I
J 50. But in any event, the proposition that the SJ has no duty to J
provide reasons for prosecutorial decisions is well supported by
K K
authorities.
L L
51. In Hong Kong, the courts have consistently rejected the
M M
notion that there is a general duty to give reasons for prosecutorial
N decisions. In Ma Pui-tung v Department of Justice, HCAL 15/2008 N
(Judgment dated 25/02/08), Saunders J acknowledged the DPP’s
O O
established practice:
P P
“The refusal of the DPP to give reasons:
Q 32. Mr Ma challenges a refusal on the part of the DPP to give Q
reasons for the decisions he has made. There is no evidence
whatsoever to suggest that there has been a refusal to give
R R
reasons, in fact the letters from the Department of Justice to Mr
Ma of 12 October 2007 and 21 November 2007, explain that
S the reason that a prosecution is not warranted is that it is S
considered there is insufficient evidence to warrant
commencing a criminal prosecution.
T T
U U
V V
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A A
B B
33. In any event, the attitude of the DPP to the giving of
reasons for a decision to prosecute or not prosecute is well
C known. It is the general practice of the DPP to refrain from C
giving reasons for decisions not to institute or continue with
criminal proceedings, other than in the most general terms,
D D
absent exceptional circumstances.
E 34. The question as to whether a DPP should be required to E
give reasons for such a decision was considered by the Court of
Appeal of Northern Ireland in Re Boyle [2006] NICA 16,
F (unreported, 28 April 2006). The court there concluded that F
there was no obligation on the Northern Ireland DPP to give
reasons.
G G
35. I am satisfied that it is not reasonably arguable that the
H position should be any different in Hong Kong. At paragraph H
14 of the judgement in Re Boyle, the court cited the relevant
passages from an affidavit filed on behalf of the DPP,
I explaining the position of the DPP in relation to the giving of I
reasons. I have no doubt whatsoever that that explanation is
equally appropriate in Hong Kong. There is nothing in the
J J
argument made before me by Mr Ma to suggest otherwise.”
(emphasis supplied)
K K
52. In the more recent decision of Re Lau Hei-wing [2016] 3
L L
HKLRD 652, Li J likewise held that there is no positive duty on the SJ to
M give reasons: – M
“Duty to give reasons
N N
22. Mr Kim argued that the expanded considerations in the
O Prosecution Code 2015 imposed on the SJ a duty to give O
reasons.
P 23. He relied on the judgment of Secretary for Security v P
Prabakar. In that case, Li CJ pointed out that the high standard
of fairness required the Secretary for Security to give reasons if
Q the torture claim was rejected. The reasons needed not be Q
elaborate but must be sufficient for the potential deportee to
R consider the possibilities of administrative review and judicial R
review.
S 24. In my judgment, the position of the Secretary for Security S
is very different in torture claims. The Secretary decides the
rights of a claimant under Part VIIC of the Immigration
T T
Ordinance. He is under a duty to act according to a high
U U
V V
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A A
B B
standard of fairness. That requires him to give reasons for his
decision.
C C
25. In deciding the venue of trial, the SJ is exercising a
prosecutorial choice which is free from interference by virtue
D of Article 63 of the Basic Law. There is no positive duty to D
give reasons. The SJ needs not give reasons as to the weight
E of individual factors contributing to the choice of venue. In E
most cases, the circumstances are obvious. In my view, in the
majority of cases like the present one, the most important factor
F is the sentence likely to be imposed on conviction. F
26. Where the SJ chooses to give reasons in exceptional
G circumstances departing from the norm, the adequacy of the G
reasons must be left to the professional judgment of the SJ. An
H extended debate as to various contributing factors should H
always be avoided.” (emphasis supplied)
I I
53. In H v DPP [1994] 2 IR 589, O’Flaherty J of the Irish
J Supreme Court held as follows at p. 603: – J
K “ Thus, Blayney J. starts from the premise that the decision K
of the Minister is open to full judicial review. However, it is
clear from the decision in The State (McCormack) v. Curran
L [1987] I.L.R.M. 225 that the discretion of the Director of Public L
Prosecutions is reviewable only in certain circumstances as set
M out by Finlay C.J. at p.237 of the report: - M
‘If, of course, it can be demonstrated that he
N reaches a decision mala fide or influenced by an N
improper motive or improper policy then his
decision would be reviewable by a court.’
O O
It would seem then that as the duty to give reasons stems
from a need to facilitate full judicial review, the limited
P intervention available in the context of the decisions of the P
Director obviates the necessity to disclose reasons.” (emphasis
Q supplied) Q
R 54. This dovetails neatly with the position in Hong Kong: the R
very limited intervention available to challenge prosecutorial decisions of
S S
the SJ obviates the necessity to disclose reasons.
T T
U U
V V
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A A
B B
55. Accordingly, Ground 1 must fail.
C C
Ground 2 – Irrationality
D D
56. The applicant claims that the Decision is irrational and
E E
perverse. The following grounds are advanced:
F (1) There has been excessive reliance on the evidence filed by F
Mr Kentish and the 1st interested party in the winding-up
G G
proceedings;
H H
(2) There has been misapplication of the Chan Chi Wan Stephen
I Judgment by the SJ; I
J (3) There was a wrong assumption that clause 2.2.7 was J
intended for a legitimate purpose.
K K
57. The interested parties invited the court to note that none of
L L
the aforesaid grounds are set out in the Form 86 filed by the applicant.
M They further submit that it is trite that no grounds shall be relied upon or M
any relief sought at the hearing except the grounds and relief set out in the
N N
Form 86 statement.
O O
58. In the end, I decide that I do not have to rule on this, as the
P P
respondent was quite prepared to deal with the applicant’s complaints
Q head-on. Indeed, Mr Hui SC, counsel for the respondent has very fairly Q
confirmed that no prejudice has been caused to the respondent by the
R R
applicant not including the allegations in the Form 86, but only in its
S Skeleton Submissions. S
T T
U U
V V
- 26 -
A A
B B
59. The test for irrationality is established in R v Secretary of
C State for Trade and Industry, ex parte Lonrho [1989] 1 WLR 525. Lord C
Keith stated (at 539H to 540B) that: –
D D
“The absence of reasons for a decision where there is no duty to
E give them cannot of itself provide any support for the suggested E
irrationality of the decision. The only significance of the
absence of reasons is that if all other known facts and
F circumstances appear to point overwhelmingly in favour of a F
different decision, the decision-maker, who has given no
reasons, cannot complain if the court draws the inference that
G G
he had no rational reason for his decision.”
H H
60. As the SJ is under no duty to give reasons for prosecutorial
I decisions, the applicant’s argument that “the SJ’s failure to provide I
reasons of the Decision cultivates the inference that it has not been made
J J
rationally” simply cannot stand.
K K
61. Further, I agree with the respondent’s submission that the
L L
facts and circumstances of this case do not point overwhelmingly in
M favour of a decision to prosecute. Detailed explanations are set out in M
Ms Ng’s Legal Advice and her Affirmation. The careful analysis speaks
N N
for itself.
O O
62. As submitted by the respondent: –
P P
(1) in reaching the Decision, Ms Ng has duly considered all
Q evidence available; Q
R (2) Ms Ng has considered the legal opinions rendered by two R
Senior Counsel for the applicant when reviewing the
S S
Decision. Despite reaching a different conclusion, the
T T
U U
V V
- 27 -
A A
B B
Decision is not one that no reasonable prosecutor could have
C reached; and C
D
(3) there is no mistake in the application of law and facts as D
alleged or at all.
E E
63. Therefore, there is nothing other than mere speculation to
F F
suggest that the Decision is irrational. As it turns out, the applicant’s
G speculation at paragraphs 79-84 of the Form 86 that “the SJ may have G
mistaken the solicited favours not to amount to an advantage when it is
H H
clear that the [interested parties] have solicited from the applicant
I advantages under the POBO” is wholly misconceived. I
J J
64. Insofar as the offence of agent soliciting an advantage is
K concerned, Ms Ng in fact found established that (1) there was a K
principal/agent relationship between Grande and the interested parties,
L L
(2) there was a solicitation by the interested parties and (3) the solicitation
M of advantage was inducement to the interested parties doing an act in M
relation to the affairs of Grande or showing favour in relation to the
N N
applicant.
O O
65. The key element of offence that Ms Ng found not established
P P
on the evidence was the mens rea, namely whether the interested parties
Q intended that the conditions in the draft restructuring agreement should be Q
solicited as an inducement or reward for or otherwise on account of their
R R
acting in relation to the principal’s affairs or business.
S S
T T
U U
V V
- 28 -
A A
B B
66. It is clear that Ms Ng’s analysis was based primarily on the
C Court of Final Appeal’s decision in Secretary for Justice v Chan Chi-wan C
Stephen (2017) 20 HKCFAR 98. I agree the applicant has not been able
D D
to demonstrate that Ms Ng had erred in her analysis in any respect, let
E alone that her analysis and conclusion were plainly wrong or perverse. E
F F
67. Ground 2 has no merit and must be rejected.
G G
Ground 3 – Illegality
H H
68. In making a prosecutorial decision, prosecutors in Hong
I Kong are guided by the Prosecution Code (2013). There is no evidential I
basis for the applicant to suggest that the SJ has failed to act in
J J
accordance with the Prosecution Code (2013).
K K
69. As correctly pointed out by the applicant, in reaching a
L L
decision to prosecute, the SJ must first be satisfied that there is sufficient
M evidence to support a reasonable prospect of conviction. Only where M
there is sufficient evidence would the issue of public interest then come
N N
into consideration. There being insufficient evidence to start with in this
O case, any prosecution against the 1st and 2nd interested parties would fail O
in limine.
P P
Q 70. I agree that it can be seen from the Affirmation of Ms Ng Q
and the Affidavit of Ms Ho Wai Man Winnie that both of them have
R R
strictly adhered to the Prosecution Code (2013). Their decision not to
S prosecute was based purely on evidential considerations. S
T T
U U
V V
- 29 -
A A
B B
71. I agree there is no merit in Ground 3, which is rejected
C accordingly. C
D D
G. CONCLUSION
E E
72. In the premises, the applicant has failed to establish the
F requisite “truly exceptional” circumstances to warrant/justify the court’s F
intervention of the SJ’s prosecutorial decision. To the contrary, the facts
G G
and history of this case strongly militate against any basis for challenge of
H the Decision by way of judicial review. The matters raised by the H
applicant would not cause the court to find that the prosecutorial decision
I I
was “unconstitutional”. The application should be dismissed on this
J basis alone. J
K 73. Further, for the reasons set out above, none of the 3 grounds K
raised by the applicant for judicial review of the Decision has been
L L
successfully made out.
M M
74. Accordingly, the applicant’s application for judicial review
N N
is dismissed.
O O
75. I see no reason why costs should not follow the event.
P P
I order that the costs of these proceedings be paid by the applicant to the
Q respondent and the 1st and 2nd interested parties, such costs are to be taxed Q
if not agreed.
R R
76. The above order as to costs is nisi and shall become absolute
S S
in the absence of any application within 21 days to vary the same.
T T
U U
V V
- 30 -
A A
B B
77. Lastly, I express my gratitude to counsel for their helpful
C assistance in this matter. C
D D
E E
F F
(Wilson Chan)
G Judge of the Court of First Instance G
High Court
H H
I Mr Lawrence Lok, SC leading Ms Mavis Lam, instructed by Messrs K & L I
Gates, for the applicant
J J
Mr Martin Hui, SC and Mr Ira Lui, ADPP, instructed by the Department of
K Justice, for the respondent K
L Mr Victor Dawes, SC leading Mr Peter Dong, instructed by Messrs L
Lipman Karas, for the 1st and 2nd interested parties
M M
N N
O O
P P
Q Q
R R
S S
T T
U U
V V
SINO BRIGHT ENTERPRISES CO., LTD v. SECRETARY FOR JUSTICE
A A
HCAL 1060/2017
B [2019] HKCFI 2882 B
C IN THE HIGH COURT OF THE C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D COURT OF FIRST INSTANCE D
CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST
E E
NO 1060 OF 2017
F ___________________ F
BETWEEN
G G
SINO BRIGHT ENTERPRISES CO., LTD. Applicant
H H
and
I I
SECRETARY FOR JUSTICE Respondent
J J
st
FOK HEI YU, VINCENT 1 Interested Party
K K
nd
RODERICK JOHN SUTTON 2 Interested Party
L L
___________________
M M
N Before: Hon Wilson Chan J in Court N
Date of Hearing: 4 July 2019
O O
Date of Judgment: 29 November 2019
P P
Q Q
JUDGMENT
R R
S S
T T
U U
V V
- 2 -
A A
B B
A. INTRODUCTION
C C
1. This is the applicant’s application for judicial review to
D challenge the decision of the then Secretary for Justice (“SJ”) on 20 D
October 2017 (the “Decision”), in which he decided not to prosecute the
E E
former provisional liquidators of the Grande Holdings Limited
F (“Grande”), namely Mr Fok Hei-yu Vincent (the “1st interested party”) F
and Mr Roderick John Sutton (the “2nd interested party”), in relation to
G G
two counts of agent soliciting an advantage, contrary to section 9(1) of
H the Prevention of Bribery Ordinance, Cap 201 (“POBO”), and one count H
of blackmail, contrary to section 23 of the Theft Ordinance, Cap 210.
I I
J 2. Leave to apply for judicial review was granted on the papers J
by Li J on 29 March 2018.
K K
B. THE APPLICANT’S CASE
L L
3. According to the Originating Summons (Form 86A) dated 9
M M
April 2018, the applicant seeks, inter alia, the following relief: –
N N
(1) an order of certiorari to quash the Decision;
O (2) further or alternatively, a declaration that the SJ’s failure to O
give adequate reasons for the Decision rendered it unlawful
P P
and void;
Q Q
(3) an order of mandamus to direct the SJ to reconsider the
R Decision in accordance with the law and to provide adequate R
reasons for it;
S S
(4) further or other relief; and
T T
(5) an order for costs.
U U
V V
- 3 -
A A
B B
4. The applicant’s principal bases for challenging the Decision
C are as follows: – C
D
(1) the Decision is amenable to judicial review because the SJ D
has failed to act in accordance with the Prosecution Code
E E
and failed to provide reasons for the Decision;
F (2) the 3 grounds for judicial review are: – F
G (a) the SJ has failed to provide adequate reasons to G
support the Decision (Ground 1);
H H
(b) the Decision is irrational, if not perverse (Ground 2);
I I
and
J (c) the SJ has failed to act in accordance with the J
Prosecution Code, which rendered the Decision illegal
K K
(Ground 3).
L L
C. SUMMARY OF THE RESPONDENT’S POSITION
M M
5. In summary, the respondent submits that this is a clear case
N N
where the application for judicial review should be refused for the
O following reasons: – O
P (1) a judicial review of a prosecutorial decision is rare and P
exceptional and hence “truly exceptional circumstances”
Q Q
must exist to justify judicial intervention. Judicial
R intervention is justified only where it can be shown that the R
SJ has acted outside “the limits of his constitutional power”.
S S
The requirement is not satisfied in this case. The
T T
U U
V V
- 4 -
A A
B B
application for judicial review should be refused on this
C ground alone; and C
D
(2) in any event, the applicant has failed to establish a case for D
judicial review, in particular: –
E E
(a) the SJ is not required to provide reasons for the
F decision not to prosecute. This is entirely consistent F
with the general practice recognised by the courts in
G G
Hong Kong and other common law jurisdictions.
H H
Circumstances of this case do not support a departure
I
from the general practice. Even if reasons are I
offered, they should be in very general terms;
J J
(b) the Decision is a rational one. The Advising Counsel,
K Ms Ng Shuk-kuen, Senior Public Prosecutor (“Ms K
Ng”) made the decision not to prosecute based on the
L L
evidence available before her, and with due
M consideration of the legal opinions rendered by Senior M
Counsel retained by the applicant. The conclusion
N N
st
that there is insufficient evidence to prosecute the 1
O and 2nd interested parties for any offence is a correct O
one; and
P P
(c) the Decision is a legal one. In accordance with the
Q Q
Prosecution Code (2013), Ms Ng assessed the
R sufficiency of evidence and rightly concluded that R
there was no reasonable prospect of conviction based
S S
on the available evidence.
T T
U U
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- 5 -
A A
B B
D. THE DECISION
C C
6. The Decision involves 3 alleged offences (collectively, the
D “Alleged Offences”) which occurred on the following occasions during D
the course of Grande’s liquidation: –
E E
st
(1) The 1 Alleged Offence took place on or around 30 April
F F
2014 when the 1st and 2nd interested parties, as Grande’s joint
G and several provisional liquidators, via their legal G
representative Mr Timothy Peter Kentish (“Kentish”) of
H H
Messrs Lipman Karas, solicited for an advantage in a draft
I restructuring agreement exchanged between the provisional I
liquidators and the applicant (the “Draft Agreement”).
J J
The Draft Agreement contained a Clause 2.2.7 which
K solicited for, inter alia: – K
(a) The applicant’s support and/or procurement of support
L L
for the appointment of the provisional liquidators as
M official liquidators of Grande; and M
N (b) The applicant’s consent to an order for the dismissal N
of a personal action (HCA 92/2014) against FTI
O O
Consulting (Hong Kong) Limited (“FTI”) and the 1st
P interested party. P
Q (collectively, the “Advantages”). Q
R
(2) The 2nd Alleged Offence occurred on 22 May 2014 during a R
st
meeting between the 1 interested party and representatives
S S
of the applicant and McVitie Group Holdings Limited
T
(“McVitie”) at FTI’s office at Level 22, The Center, 99 T
U U
V V
- 6 -
A A
B B
Queen’s Road Central, Central, Hong Kong (the “Meeting”).
C At the Meeting, the 1st interested party, acting on behalf of C
himself and the 2nd interested party, solicited once again for
D D
the Advantages by saying: –
E E
(a) If support from the applicant and McVitie for the
F appointment of the 1st and 2nd interested parties as F
Grande’s official liquidators is forthcoming, and if the
G G
applicant would stay the civil action no HCA 92/2014
H against the 1st interested party and FTI personally, then H
the provisional liquidators would not only review the
I I
proof of debts (“PODs”) of the applicant and the two
J other companies which were previously objected to on J
an earlier occasion, but would also “build in the
K K
necessary commercial arrangements” so that the same
L PODs previously objected to could be admitted for the L
purpose of Grande’s restructuring scheme; and
M M
(b) If the applicant does not accede to the provisional
N liquidators’ request as solicited, Grande’s restructuring N
process would be “back to square one” whereby
O O
Grande will return to normal liquidation, the
P provisional liquidators would not agree to the P
Q
applicant’s proposed self-rescue plan, and the Q
applicant would be expected to suffer financially.
R R
(3) The 3rd Alleged Offence took place on 23 May 2014 during a
S telephone conversation between the 1st interested party, S
acting on behalf of himself and the 2nd interested party, and
T T
U U
V V
- 7 -
A A
B B
Mr Ian Grant Robinson (“Robinson”) of the applicant (the
C “Call”). During the Call: – C
D
(a) The 1st interested party demanded for the applicant’s D
nd
support towards the appointment of him and the 2
E E
interested party as Grande’s official liquidators with
F express menaces, by stating that the absence of F
support from the applicant, McVitie and/or Gain
G G
Alpha would “… make the whole things very ugly…”
H and would amount to a “deal breaker” for any H
proposals put forth by the applicant for the benefit of
I I
Grande’s restructuring; and
J (b) The 1st interested party also asked that the personal J
action against him be “preferably withdrawal” or
K K
stayed.
L L
E. FACTUAL BACKGROUND
M M
E1. Background of winding-up proceedings for Grande
N N
7. The applicant is a major creditor of Grande and presented a
O O
winding up petition on 30 May 2011. Since then, trading of Grande’s
P shares was suspended on the Hong Kong Stock Exchange (“HKSE”). P
Q Q
8. The interested parties were appointed as the joint and several
R liquidators of Grande on 31 May 2011 by an order of the High Court. R
On 31 March 2012, the interested parties submitted a resumption
S S
proposal to the HKSE. The proposal was, however, rejected and Grande
T was placed in the second stage of delisting by the HKSE. T
U U
V V
- 8 -
A A
B B
9. A second proposal was submitted but it was also rejected by
C the HKSE on 28 June 2013. As a result, Grande was placed in the third C
stage of the HKSE’s de-listing procedures and was given until 24
D D
December 2013 to submit a viable proposal for the resumption in trading
E of the shares. E
F F
10. On 12 September 2013, DHCJ Le Pichon made a
G winding-up order against Grande. G
H 11. From then on, the interested parties and the applicant H
engaged in a series of long and often hostile negotiations in relation to
I I
restructuring proposals for Grande. The relevant background has been
J set out in the affidavits filed by Mr Kentish and the 1st interested party in J
the winding-up proceedings:
K K
(1) From October 2013, the applicant pressed the interested
L L
parties to engage in the Self-Rescue Plan. The interested
M parties, however, did not consider the aforesaid Self-Rescue M
Plan to be in the best interests of Grande’s general body of
N N
creditors, as it failed to provide creditors with the option of a
O cash dividend. Further, a body of creditors (known as the O
“Kayne Creditors”) would not support a resumption
P P
proposal without a substantial cash dividend.
Q Q
(2) On 10 December 2013, the applicant issued summons
R seeking orders to compel the interested parties to submit the R
Self-Rescue Plan. In addition, the Kayne Creditors also
S S
assigned their claim in the winding up to McVitie, another
T creditor of Grande. T
U U
V V
- 9 -
A A
B B
(3) Given that (i) there was no viable alternative proposal;
C (ii) Kayne Creditors had assigned their claim against Grande C
to McVitie; (iii) the applicant’s indication that it would meet
D D
the costs of the Self-Rescue Plan, the interested parties
E agreed to submit the proposal to the HKSE on 16 December E
2013.
F F
(4) On 15 January 2014, the applicant commenced a civil action
G G
under HCA 92/2014 against the 1st interested party and FTI
H personally for damages and for loss it allegedly suffered as a H
result of the 1st interested party and/or FTI’s
I I
misrepresentation and false advice prior to the appointment
J of the interested parties. J
K (5) The interested parties had, since January 2014, sought for the K
payment of their fees and expenses in relation to the
L L
preparation of the Self-Rescue Plan. However, despite a
M series of ultimatums to Messrs K&L Gates (“K&L Gates”), M
solicitors for the applicant both in these proceedings and in
N N
the winding-up proceedings, no positive response from the
O applicant was given. This gave rise to concerns because if O
the resumption proposal were to continue, the costs of the
P P
proposal would need to be met out of the assets of Grande.
Q Q
(6) A further ultimatum was issued on 5 March 2014 to K&L
R Gates that unless the resumption proposal was improved by R
10 March 2014 with the inclusion of a cash dividend, it
S S
would be withdrawn by the interested parties.
T T
U U
V V
- 10 -
A A
B B
(7) Thereafter, on 12 March 2014, an urgent application was
C made by the applicant for orders that the interested parties do C
not withdraw the resumption proposal. At the hearing on
D D
the same day, the applicant undertook to meet the costs of
E the resumption proposal going forward and to pay HK$ 5 E
million into court as security for the undertaking. Upon the
F F
provision of the undertaking, the interested parties agreed
G not to withdraw the resumption proposal for the time being. G
H (8) The 1st Creditors’ meeting was then held on 14 March 2014. H
At the meeting, the applicant, McVitie and Gain Alpha were
I I
against the appointment of the interested parties as Grande’s
J official liquidators. However, the independent creditors J
voted for the 1st and 2nd interested parties to remain in office.
K K
(9) The applicant, McVitie and Gain Alpha are all associated
L L
parties of Mr Ho Wing On (former chairman and director of
M Grande), against whom the interested parties had filed a M
protective writ on behalf of Grande for proceedings alleging,
N N
inter alia, stripping assets from the company through 14
O separate transactions. O
P 12. Thereafter, from March 2014 the interested parties and the P
applicant continued negotiations in attempt to reach a restructure
Q Q
agreement based on the applicant’s resumption proposal. In addition,
R R
the HKSE informed the interested parties that it required a restructure
S
agreement to be entered between Grande and the applicant by the end of S
April 2014. It was the events after April 2014 that led to the applicant’s
T T
present allegations against the interested parties.
U U
V V
- 11 -
A A
B B
E2. Events leading to the Alleged Offences
C C
13. In short, the applicant claims that the interested parties had
D committed the following offences in the course of their negotiations with D
the applicant in relation to the restructure agreement:
E E
(1) Two counts of soliciting for an advantage contrary to section
F F
9(1) of the POBO.
G (2) One count of blackmail contrary to section 23 of the Theft G
Ordinance.
H H
I 14. The relevant factual background for each of the Alleged I
Offence is set out below.
J J
K E2a. First alleged solicitation of advantage K
L 15. On 29 April 2014, the 1st interested party informed Mr L
Kentish that, as previously requested, the applicant was willing to provide
M M
a cash dividend to creditors. Although the amount was not considered
N to be sufficient by the 1st interested party, it appeared to Mr Kentish that N
the parties were close to reaching an agreement. Mr Kentish then sent
O O
an email to the 1st interested party highlighting further matters which
P should desirably be addressed in the proposed restructure agreement (“29 P
April 2014 Email”).
Q Q
16. The issues mentioned in the 29 April 2014 Email include:
R R
(i) the applicant and others withdraw their opposition to the appointment
S S
of the interested parties; (ii) the action by the applicant against the 1st
T
interested party and FTI be withdrawn (“Relevant Proposals”). T
U U
V V
- 12 -
A A
B B
According to Mr Kentish, the rationale behind the email was that it would
C be in the interests of all parties for the various outstanding disputes to be C
resolved and further costs avoided.
D D
E
17. Significantly, the rationale for (i) and (ii) above were: E
(1) For (i), it was considered that there were strong reasons for
F F
the court to disregard the votes cast by creditors associated
G with Mr Ho (ie the applicant, McVitie and Grand Alpha), G
and it was very likely that the 1st and 2nd interested parties
H H
would be appointed as liquidators of Grande in spite of their
I opposition. If the applicant’s camp could withdraw their I
opposition, substantial costs could be saved.
J J
(2) For (ii), given that HCA 92/2014 was essentially a complaint
K K
against the conduct of the interested parties as provisional
L liquidators of Grande, and the proceedings would have to be L
discontinued if the applicant’s resumption proposal was
M M
approved by the HKSE and creditors to enable the interested
N parties to be released. N
O O
18. The overarching concern was that of costs in relation to each
P of the above, which was apparently a concern shared by the applicant. P
Q 19. Thereafter on 30 April 2014, Mr Chiang of the applicant Q
informed the 1st interested party that the applicant was willing to increase
R R
the amount of cash dividend. As a result, a revised draft restructuring
S S
agreement was prepared and circulated amongst the relevant parties.
T
The covering email of the draft agreement by the 1st interested party T
U U
V V
- 13 -
A A
B B
expressly stated that the draft was provided “on a without prejudice basis
C for the purpose of further advancing negotiations.” (“30 April 2014 C
Email”).
D D
E
20. The draft agreement contained, inter alia, the Relevant E
Proposals in clause 2.2.7 referred to in paragraph 6(1) above:
F F
(1) The applicant do take “all steps necessary to support the
G appointment of the Provisional Liquidators as Liquidators of G
the Company…”, including to procure McVitie and Gain
H H
Alpha to also support the appointment of the interested
I parties as liquidators of Grande (Clause 2.2.7 (c)); I
J (2) The applicant consent to orders for the dismissal of J
HCA 92/2014 with no order as to costs (Clause 2.2.7(f)).
K K
L 21. The applicant now contends that the email attaching the draft L
agreement on 30 April 2014 amounted to a solicitation of advantage by
M M
an agent contrary to section 9(1) of the POBO: see Lawrence Lok SC’s
N legal opinion dated 22 May 2017 (“Mr Lok SC Opinion”). N
O 22. On 2 May 2014, a revised restructuring agreement was O
signed with clause 2.2.7 removed and replaced with a new clause 2.4,
P P
which required the parties to negotiate and resolve the outstanding legal
Q actions within a period of 4 weeks instead of contesting them Q
unnecessarily to the detriment of Grande (“Executed Agreement”).
R R
S S
T T
U U
V V
- 14 -
A A
B B
E2b. Second alleged solicitation of advantage
C C
23. The second alleged offence arose from the Meeting amongst,
D inter alios, Mr Robinson and Mr Chiang for the applicant and the 1st D
interested party at FTI’s offices.
E E
F 24. The applicant claims that the 1st interested party had solicited F
again for (i) support for the appointment of the interested parties as
G G
Grande’s official liquidators; and (ii) a stay of HCA 92/2014. The
H solicitation was allegedly made in exchange for the interested parties to H
review the proof of debts of the applicant, McVitie and Gain Alpha
I I
previously objected to at the 1st Creditors’ Meeting and to admit the same
J for the purpose of Grande’s restructuring scheme. J
K E2c. Alleged blackmail K
L 25. The alleged blackmail took place during the Call between the L
1st interested party and Mr Robinson on behalf of the applicant on 23
M M
st
May 2014. It is alleged that the 1 interested party had made
N unwarranted “threats” to the applicant, McVitie and Gain Alpha in order N
to gain their support of the interested parties’ appointment as liquidators
O O
of Grande.
P P
F. DISCUSSION
Q Q
F1. The Decision is not amenable to Judicial Review
R R
26. The starting point is that a prosecutorial decision of the SJ is
S S
generally not amenable to judicial review. Prior to the handover in 1997,
T T
U U
V V
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A A
B B
judicial review had little, if any, role to play in relation to prosecutorial
C decisions. C
D D
27. In Keung Siu-wah v Attorney General [1990] 2 HKLR 238,
E
the Court of Appeal expressed the view that it was a “constitutional E
imperative” that the courts would not interfere with the Attorney
F F
General’s prosecutorial discretion and a decision to prosecute or not to
G prosecute was not amenable to judicial review. Fuad VP, with whom G
the other judges agreed, stated at p 253B-D that, “I entertain no doubt
H H
whatever that the decision to prosecute in the instant case, likewise, is not
I subject to the judicial review process; such a decision does not fall within I
the criteria for a reviewable decision stated by Lord Diplock in Council
J J
of Civil Service Unions at pp.408-409. Only the Attorney General has
K access to all the necessary information. The cases stress (e.g. Chief K
Constable of North Wales Police v Evans [1982] 1 WLR 1155, 1173) that
L L
judicial review is concerned with reviewing, not the merits of the decision
M in respect of which the application for judicial review is made, but the M
decision-making process itself. In the case of a decision by the Attorney
N N
General to institute a prosecution how is this review to be conducted?”
O and “I can imagine few subjects less adapted to the judicial review O
procedure under O.53 than the exercise of the Attorney General's
P P
discretion in deciding whether to institute criminal proceedings and what
Q charge should be preferred”. Q
R R
28. See also the observation of Penlington JA at pp 255J-256A
S
that “… the authorities are overwhelming that the decision of the S
Attorney General whether or not to prosecute in any particular case is
T T
not subject to judicial review”.
U U
V V
- 16 -
A A
B B
29. Following the handover in 1997, Article 63 of the Basic Law
C (“BL63”) is the bulwark of prosecutorial independence. It provides that, C
“The Department of Justice of the Hong Kong Special Administrative
D D
Region shall control criminal prosecutions, free from any interference”.
E E
30. The control in criminal prosecutions of course encompasses
F F
the making of prosecutorial decisions of whether or not to prosecute.
G This prerogative is also underpinned in section 15(1) of the Criminal G
Procedure Ordinance, Cap 221.
H H
31. In Kwan Sun-chu Pearl v Department of Justice HCAL
I I
56/2005, Hartmann J (as he then was) refused leave to judicially review a
J decision not to prosecute based principally on Keung Siu-wah, ibid. J
Furthermore, His Lordship held that absent any dishonesty, bad faith or
K K
some other exceptional circumstances, judicial review would not be
L available, even taking into account the development of the law since L
Keung Siu-wah (§§13-16). On the evidence, His Lordship could not
M M
“find any grounds for suggesting that the Department of Justice came to a
N plainly wrong decision not to prosecute; that is, a decision which is N
unreasonable in law” (§10).
O O
P 32. On appeal in Kwan Sun-chu Pearl v Department of Justice P
[2006] 3 HKC 207, the Court of Appeal affirmed Hartmann J’s decision
Q Q
and reasoning. At §7, Tang JA (as he then was) expressed his
R agreement with Hartmann J’s decision and went on to say that “Whether R
Keung Siu Wah v Attorney General precludes judicial review in relation
S S
to the decision of the Department of Justice not to prosecute whatever the
T circumstances is an open question so far as the Court of Final Appeal is T
U U
V V
- 17 -
A A
B B
concerned and it may be that despite Young v Bristol Aeroplane Co Ltd
C [1944] KB 718 CA, the matter is open to review by this court”. C
D D
33. Then came the landmark case of RV v Director of
E
Immigration [2008] 4 HKLRD 529, where Hartmann J qualified Keung E
Siu-wah and held that the SJ’s control of criminal prosecutions is a
F F
constitutional power and must therefore be exercised within constitutional
G limits. On a true construction of the Basic Law, the courts have G
jurisdiction to judicially review the SJ’s power to control criminal
H H
prosecutions and to determine whether or not he had acted within the
I limits of his constitutional power. That was not considered a defiance of I
the binding pre-1997 precedent of Keung Siu-wah but the recognition of a
J J
new constitutional order under the Basic Law. See §§55-70.
K K
34. At §§71-75 of RV, Hartmann J identified three circumstances
L under which “judicial encroachment” is called for, viz (1) where the SJ L
acts in obedience to a political instruction (§71); (2) where the SJ acts in
M M
bad faith, for example, if one of his officers instituted a prosecution in
N return for payment of a bribe (§72); or (3) where there is a rigid fettering N
of discretion, for example, a refusal to prosecute a specific class of
O O
offences detailed in a statute lawfully brought into law (§73).
P Importantly, His Lordship emphasized that the role of the SJ must not be P
reduced to “that of an ordinary administrator” and that the circumstances
Q Q
justifying judicial encroachment “must be truly exceptional and must
R R
demonstrate that the Secretary has acted outside of his very broad
S
powers” (§74). S
T T
U U
V V
- 18 -
A A
B B
35. In this regard, the Court of Appeal’s judgment in Re C (A
C Bankrupt) [2006] 4 HKC 582 is pertinent. At §20, Stock JA (as he then C
was) observed in the leading judgment that “I apprehend that it is to such
D D
interference, that is to say, interference of a political kind, to which Art
E 63 is directed. But the rule that ensures the Secretary’s independence in E
his prosecutorial function necessarily extends to preclude judicial
F F
interference, subject only to issues of abuse of the court’s process and,
G possibly, judicial review of decisions taken in bad faith”. (emphasis G
supplied).
H H
I 36. The decision in RV was expressly adopted by the Court of I
Appeal in Re Leung Lai Fun [2018] HKLRD 523. At paragraph 10, the
J J
court held as follows: –
K “10. Article 63 of the Basic Law provides that ‘The K
Department of Justice shall control criminal prosecutions, free
L from any interference’. As Hartmann J had pointed out in RV L
v Director of Immigration [2008] 4 HKLRD 529, this provision
includes the protection of the independence of the Department
M of Justice’s control of criminal prosecutions from judicial M
encroachment. It is only if the case belongs to those
extremely rare situations, such as where there is evidence
N N
proving that the Department of Justice has acted in obedience
to political instruction when making the decision, or is acting in
O bad faith, such as to cause the Court to find that the O
prosecutorial decision is unconstitutional, that the Court will
have jurisdiction to review the decision concerned. Otherwise
P the Court should not encroach on the right of the Department of P
Justice to control prosecutions. This is the major premise
Q which is founded on principle.” (emphasis supplied) Q
R 37. As noted by Chow J in Kwok Cheuk Kin v Secretary for R
Justice [2019] HKCFI 2215, handed down on 6 September 2019, Re
S S
Leung Lai Fun is the latest judicial guidance from the Court of Appeal on
T the issue of the amenability of the Secretary for Justice’s prosecutorial T
U U
V V
- 19 -
A A
B B
decisions to judicial review. It can also be noted that Re Leung Lai Fun
C is a case which involved a decision not to prosecute. C
D D
38. As submitted by the respondent, although the “truly
E
exceptional” circumstances Hartmann J referred to in RV are not stated to E
be exhaustive, its ambit must be narrowly confined. Classic judicial
F F
review grounds such as irrationality and illegality cannot, without more,
G constitute “truly exceptional” circumstances which warrant a judicial G
review of a prosecutorial decision, or else the SJ’s role would effectively
H H
be reduced to “that of an ordinary administrator”.
I I
39. Prior to the instant case, the only case in which leave was
J granted to commence judicial review against a decision not to prosecute J
is D v Director of Public Prosecutions [2015] 4 HKLRD 62. There the
K K
prosecutorial decision was challenged primarily on the basis that the
L Director of Public Prosecutions had misunderstood or misapplied the test L
for recklessness and thus reached a clearly wrong decision.
M M
N 40. However, the decision in D does not in any way alter the N
position that a decision not to prosecute is generally not amenable to
O O
judicial review, save and except in limited and “truly exceptional”
P circumstances. In Re Leung Lai Fun, Supra, the Court of Appeal, after P
referring to the principles in RV, observed that: –
Q Q
“11. As regards the case cited by Ms Leung, D v Director of
R Public Prosecutions [2015] 4 HKLRD 62 that judgment did not R
raise any legal concept inconsistent with the principle
mentioned above. In that case, the Judge took into account
S the particular circumstances of the case and took the view that S
the applicant's case was reasonably arguable. That was the
T Judge’s preliminary view and there was no further development T
U U
V V
- 20 -
A A
B B
of the case. In any event, the decision is not binding upon this
Court.”
C C
41. The exercise of judicial restraint when reviewing
D D
prosecutorial decisions by the public authorities is shared across common
E law jurisdictions: See in Canada, Krieger v Law Society of Alberta 2002 E
SCC 65 at §§32, 47; in Singapore, Yong Vui Kong v Public Prosecutor
F F
[2012] 2 SLR 872 at §17; in Fiji, Matalulu and Another v Director of
G Prosecutions [2003] 2 HKC 457; in Mauritius (held by the Privy Council), G
Mohit v Director of Public Prosecutions of Mauritius [2006] UKPC 20 at
H H
§§17, 21.
I I
42. As such, the applicant’s reliance on the English authorities is
J J
misconceived. In particular, the applicant omitted the Court of Appeal’s
K clear statement of principle in Re Leung Lai Fun, and invites this court to K
effectively conduct an extensive review of the merits of the underlying
L L
evidence in deciding that the Decision was perverse or irrational.
M I agree that this approach essentially relegates the SJ’s decision to that of M
an ordinary administrator, as cautioned against by Hartmann J in RV.
N N
43. Applying the principles enunciated in the Hong Kong cases
O O
cited above, it is abundantly clear that the instant application does not
P involve any “truly exceptional circumstances” so that the SJ’s P
prosecutorial decision is vitiated on constitutional grounds.
Q Q
R 44. As submitted by the respondent, it is pertinent to note that R
the applicant has not suggested that in reaching the Decision, the SJ or the
S S
Advising Counsel Ms Ng was acting in obedience to any political
T instruction or in bad faith. Nor has it been suggested that there was any T
U U
V V
- 21 -
A A
B B
rigid fettering of prosecutorial discretion. The applicant’s contention
C that the Decision was plainly wrong and contrary to the evidence does not C
and cannot bring the Decision within the narrow class of prosecutorial
D D
decisions that the court may judicially review. In truth, the applicant
E can at best argue that there may on one view be sufficient evidence to E
prosecute the 1st and 2nd interested parties. As can be seen in Re Leung
F F
Lai Fun, such an “error of law”, even if established, does not render the
G Decision judicially reviewable. G
H H
45. I agree that the instant application for judicial review should
I be dismissed on this ground alone. I
J 46. In this regard, the applicant has submitted that a distinction J
should be drawn between a decision to prosecute and a decision not to
K K
prosecute. The applicant says this is because judicial review is the only
L means by which a citizen can seek redress against a decision not to L
prosecute.
M M
N 47. Whilst this distinction has been drawn in some previous N
decisions, in my view, it cannot override the statement of principle in RV
O O
and Re Leung Lai Fun that the prosecutorial decision has to be
P “unconstitutional” before the court will have “jurisdiction” to review the P
decision concerned (see paragraph 36 above). In this regard, as already
Q Q
noted above, Re Leung Lai Fun itself was a case where the Director of
R Public Prosecutions had decided not to prosecute. R
S S
T T
U U
V V
- 22 -
A A
B B
F2. No valid case for Judicial Review
C C
48. In any event, I agree that none of the 3 grounds for judicial
D review put forward by the applicant has any merit. D
E E
Ground 1 – Duty to give adequate reasons
F F
49. In its skeleton submissions at paragraph 16, the applicant
G properly “concedes that Ground 1 is now theoretical, as reasons for the G
Decision have been disclosed pursuant to the Affirmation of Ms Ng dated
H H
4 June 2018”. Given the academic nature of the matter, no relief should
I be granted. I
J 50. But in any event, the proposition that the SJ has no duty to J
provide reasons for prosecutorial decisions is well supported by
K K
authorities.
L L
51. In Hong Kong, the courts have consistently rejected the
M M
notion that there is a general duty to give reasons for prosecutorial
N decisions. In Ma Pui-tung v Department of Justice, HCAL 15/2008 N
(Judgment dated 25/02/08), Saunders J acknowledged the DPP’s
O O
established practice:
P P
“The refusal of the DPP to give reasons:
Q 32. Mr Ma challenges a refusal on the part of the DPP to give Q
reasons for the decisions he has made. There is no evidence
whatsoever to suggest that there has been a refusal to give
R R
reasons, in fact the letters from the Department of Justice to Mr
Ma of 12 October 2007 and 21 November 2007, explain that
S the reason that a prosecution is not warranted is that it is S
considered there is insufficient evidence to warrant
commencing a criminal prosecution.
T T
U U
V V
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A A
B B
33. In any event, the attitude of the DPP to the giving of
reasons for a decision to prosecute or not prosecute is well
C known. It is the general practice of the DPP to refrain from C
giving reasons for decisions not to institute or continue with
criminal proceedings, other than in the most general terms,
D D
absent exceptional circumstances.
E 34. The question as to whether a DPP should be required to E
give reasons for such a decision was considered by the Court of
Appeal of Northern Ireland in Re Boyle [2006] NICA 16,
F (unreported, 28 April 2006). The court there concluded that F
there was no obligation on the Northern Ireland DPP to give
reasons.
G G
35. I am satisfied that it is not reasonably arguable that the
H position should be any different in Hong Kong. At paragraph H
14 of the judgement in Re Boyle, the court cited the relevant
passages from an affidavit filed on behalf of the DPP,
I explaining the position of the DPP in relation to the giving of I
reasons. I have no doubt whatsoever that that explanation is
equally appropriate in Hong Kong. There is nothing in the
J J
argument made before me by Mr Ma to suggest otherwise.”
(emphasis supplied)
K K
52. In the more recent decision of Re Lau Hei-wing [2016] 3
L L
HKLRD 652, Li J likewise held that there is no positive duty on the SJ to
M give reasons: – M
“Duty to give reasons
N N
22. Mr Kim argued that the expanded considerations in the
O Prosecution Code 2015 imposed on the SJ a duty to give O
reasons.
P 23. He relied on the judgment of Secretary for Security v P
Prabakar. In that case, Li CJ pointed out that the high standard
of fairness required the Secretary for Security to give reasons if
Q the torture claim was rejected. The reasons needed not be Q
elaborate but must be sufficient for the potential deportee to
R consider the possibilities of administrative review and judicial R
review.
S 24. In my judgment, the position of the Secretary for Security S
is very different in torture claims. The Secretary decides the
rights of a claimant under Part VIIC of the Immigration
T T
Ordinance. He is under a duty to act according to a high
U U
V V
- 24 -
A A
B B
standard of fairness. That requires him to give reasons for his
decision.
C C
25. In deciding the venue of trial, the SJ is exercising a
prosecutorial choice which is free from interference by virtue
D of Article 63 of the Basic Law. There is no positive duty to D
give reasons. The SJ needs not give reasons as to the weight
E of individual factors contributing to the choice of venue. In E
most cases, the circumstances are obvious. In my view, in the
majority of cases like the present one, the most important factor
F is the sentence likely to be imposed on conviction. F
26. Where the SJ chooses to give reasons in exceptional
G circumstances departing from the norm, the adequacy of the G
reasons must be left to the professional judgment of the SJ. An
H extended debate as to various contributing factors should H
always be avoided.” (emphasis supplied)
I I
53. In H v DPP [1994] 2 IR 589, O’Flaherty J of the Irish
J Supreme Court held as follows at p. 603: – J
K “ Thus, Blayney J. starts from the premise that the decision K
of the Minister is open to full judicial review. However, it is
clear from the decision in The State (McCormack) v. Curran
L [1987] I.L.R.M. 225 that the discretion of the Director of Public L
Prosecutions is reviewable only in certain circumstances as set
M out by Finlay C.J. at p.237 of the report: - M
‘If, of course, it can be demonstrated that he
N reaches a decision mala fide or influenced by an N
improper motive or improper policy then his
decision would be reviewable by a court.’
O O
It would seem then that as the duty to give reasons stems
from a need to facilitate full judicial review, the limited
P intervention available in the context of the decisions of the P
Director obviates the necessity to disclose reasons.” (emphasis
Q supplied) Q
R 54. This dovetails neatly with the position in Hong Kong: the R
very limited intervention available to challenge prosecutorial decisions of
S S
the SJ obviates the necessity to disclose reasons.
T T
U U
V V
- 25 -
A A
B B
55. Accordingly, Ground 1 must fail.
C C
Ground 2 – Irrationality
D D
56. The applicant claims that the Decision is irrational and
E E
perverse. The following grounds are advanced:
F (1) There has been excessive reliance on the evidence filed by F
Mr Kentish and the 1st interested party in the winding-up
G G
proceedings;
H H
(2) There has been misapplication of the Chan Chi Wan Stephen
I Judgment by the SJ; I
J (3) There was a wrong assumption that clause 2.2.7 was J
intended for a legitimate purpose.
K K
57. The interested parties invited the court to note that none of
L L
the aforesaid grounds are set out in the Form 86 filed by the applicant.
M They further submit that it is trite that no grounds shall be relied upon or M
any relief sought at the hearing except the grounds and relief set out in the
N N
Form 86 statement.
O O
58. In the end, I decide that I do not have to rule on this, as the
P P
respondent was quite prepared to deal with the applicant’s complaints
Q head-on. Indeed, Mr Hui SC, counsel for the respondent has very fairly Q
confirmed that no prejudice has been caused to the respondent by the
R R
applicant not including the allegations in the Form 86, but only in its
S Skeleton Submissions. S
T T
U U
V V
- 26 -
A A
B B
59. The test for irrationality is established in R v Secretary of
C State for Trade and Industry, ex parte Lonrho [1989] 1 WLR 525. Lord C
Keith stated (at 539H to 540B) that: –
D D
“The absence of reasons for a decision where there is no duty to
E give them cannot of itself provide any support for the suggested E
irrationality of the decision. The only significance of the
absence of reasons is that if all other known facts and
F circumstances appear to point overwhelmingly in favour of a F
different decision, the decision-maker, who has given no
reasons, cannot complain if the court draws the inference that
G G
he had no rational reason for his decision.”
H H
60. As the SJ is under no duty to give reasons for prosecutorial
I decisions, the applicant’s argument that “the SJ’s failure to provide I
reasons of the Decision cultivates the inference that it has not been made
J J
rationally” simply cannot stand.
K K
61. Further, I agree with the respondent’s submission that the
L L
facts and circumstances of this case do not point overwhelmingly in
M favour of a decision to prosecute. Detailed explanations are set out in M
Ms Ng’s Legal Advice and her Affirmation. The careful analysis speaks
N N
for itself.
O O
62. As submitted by the respondent: –
P P
(1) in reaching the Decision, Ms Ng has duly considered all
Q evidence available; Q
R (2) Ms Ng has considered the legal opinions rendered by two R
Senior Counsel for the applicant when reviewing the
S S
Decision. Despite reaching a different conclusion, the
T T
U U
V V
- 27 -
A A
B B
Decision is not one that no reasonable prosecutor could have
C reached; and C
D
(3) there is no mistake in the application of law and facts as D
alleged or at all.
E E
63. Therefore, there is nothing other than mere speculation to
F F
suggest that the Decision is irrational. As it turns out, the applicant’s
G speculation at paragraphs 79-84 of the Form 86 that “the SJ may have G
mistaken the solicited favours not to amount to an advantage when it is
H H
clear that the [interested parties] have solicited from the applicant
I advantages under the POBO” is wholly misconceived. I
J J
64. Insofar as the offence of agent soliciting an advantage is
K concerned, Ms Ng in fact found established that (1) there was a K
principal/agent relationship between Grande and the interested parties,
L L
(2) there was a solicitation by the interested parties and (3) the solicitation
M of advantage was inducement to the interested parties doing an act in M
relation to the affairs of Grande or showing favour in relation to the
N N
applicant.
O O
65. The key element of offence that Ms Ng found not established
P P
on the evidence was the mens rea, namely whether the interested parties
Q intended that the conditions in the draft restructuring agreement should be Q
solicited as an inducement or reward for or otherwise on account of their
R R
acting in relation to the principal’s affairs or business.
S S
T T
U U
V V
- 28 -
A A
B B
66. It is clear that Ms Ng’s analysis was based primarily on the
C Court of Final Appeal’s decision in Secretary for Justice v Chan Chi-wan C
Stephen (2017) 20 HKCFAR 98. I agree the applicant has not been able
D D
to demonstrate that Ms Ng had erred in her analysis in any respect, let
E alone that her analysis and conclusion were plainly wrong or perverse. E
F F
67. Ground 2 has no merit and must be rejected.
G G
Ground 3 – Illegality
H H
68. In making a prosecutorial decision, prosecutors in Hong
I Kong are guided by the Prosecution Code (2013). There is no evidential I
basis for the applicant to suggest that the SJ has failed to act in
J J
accordance with the Prosecution Code (2013).
K K
69. As correctly pointed out by the applicant, in reaching a
L L
decision to prosecute, the SJ must first be satisfied that there is sufficient
M evidence to support a reasonable prospect of conviction. Only where M
there is sufficient evidence would the issue of public interest then come
N N
into consideration. There being insufficient evidence to start with in this
O case, any prosecution against the 1st and 2nd interested parties would fail O
in limine.
P P
Q 70. I agree that it can be seen from the Affirmation of Ms Ng Q
and the Affidavit of Ms Ho Wai Man Winnie that both of them have
R R
strictly adhered to the Prosecution Code (2013). Their decision not to
S prosecute was based purely on evidential considerations. S
T T
U U
V V
- 29 -
A A
B B
71. I agree there is no merit in Ground 3, which is rejected
C accordingly. C
D D
G. CONCLUSION
E E
72. In the premises, the applicant has failed to establish the
F requisite “truly exceptional” circumstances to warrant/justify the court’s F
intervention of the SJ’s prosecutorial decision. To the contrary, the facts
G G
and history of this case strongly militate against any basis for challenge of
H the Decision by way of judicial review. The matters raised by the H
applicant would not cause the court to find that the prosecutorial decision
I I
was “unconstitutional”. The application should be dismissed on this
J basis alone. J
K 73. Further, for the reasons set out above, none of the 3 grounds K
raised by the applicant for judicial review of the Decision has been
L L
successfully made out.
M M
74. Accordingly, the applicant’s application for judicial review
N N
is dismissed.
O O
75. I see no reason why costs should not follow the event.
P P
I order that the costs of these proceedings be paid by the applicant to the
Q respondent and the 1st and 2nd interested parties, such costs are to be taxed Q
if not agreed.
R R
76. The above order as to costs is nisi and shall become absolute
S S
in the absence of any application within 21 days to vary the same.
T T
U U
V V
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A A
B B
77. Lastly, I express my gratitude to counsel for their helpful
C assistance in this matter. C
D D
E E
F F
(Wilson Chan)
G Judge of the Court of First Instance G
High Court
H H
I Mr Lawrence Lok, SC leading Ms Mavis Lam, instructed by Messrs K & L I
Gates, for the applicant
J J
Mr Martin Hui, SC and Mr Ira Lui, ADPP, instructed by the Department of
K Justice, for the respondent K
L Mr Victor Dawes, SC leading Mr Peter Dong, instructed by Messrs L
Lipman Karas, for the 1st and 2nd interested parties
M M
N N
O O
P P
Q Q
R R
S S
T T
U U
V V