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Chang Wa Shan v Esther Chan Pui Kwan（陳佩君）also Known As Chan Pui Chun

Judgment Cited authorities 20 Cited in Precedent Map Related
Vincent
Judgment Date11 July 2018
Neutral Citation[2018] HKCFA 29
Judgement NumberFACV3/2018
Citation(2018) 21 HKCFAR 370
Year2018
Subject MatterFinal Appeal (Civil)
CourtCourt of Final Appeal (Hong Kong)
FACV2/2018 ESTHER CHAN PUI KWAN（陳佩君）also known as CHAN PUI CHUN（陳佩珍）v. CHANG WA SHAN

FACV Nos. 2 and 3 of 2018

[2018] HKCFA 29

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 2 OF 2018 (CIVIL)

(ON APPEAL FROM CACV NO. 240 OF 2015)

____________________

BETWEEN
CHANG WA SHAN Plaintiff
(Respondent)
and
ESTHER CHAN PUI KWAN（陳佩君）
also known as CHAN PUI CHUN（陳佩珍）		 Defendant
(Appellant)

_____________________

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 3 OF 2018 (CIVIL)

(ON APPEAL FROM CACV NO. 240 OF 2015)

____________________

BETWEEN
CHANG WA SHAN Plaintiff
(Appellant)
and
ESTHER CHAN PUI KWAN（陳佩君）
also known as CHAN PUI CHUN（陳佩珍）		 Defendant
(Respondent)

Before : Mr Justice Ribeiro PJ, Mr Justice Tang PJ, Mr Justice Fok PJ, Mr Justice Stock NPJ and Lord Walker of Gestingthorpe NPJ

Date of Hearing: 6 June 2018

Date of Judgment: 11 July 2018

________________________

J U D G M E N T

_________________________

Mr Justice Ribeiro PJ:

1. I agree with the judgment of Lord Walker of Gestingthorpe NPJ and with the concurring judgment of Mr Justice Fok PJ.

Mr Justice Tang PJ:

Background

2. The plaintiff’s claim for defamation and malicious falsehood against the defendant arose out of a probate action over the will of Nina Wang (the “probate action”). In the probate action,[1] Tony Chan sought to propound as the last will of Nina Wang a will under which he was the sole beneficiary of her estate which included the Chinachem Group (“Chinachem”). Against him was the Chinachem Charitable Foundation Limited (“CCFL”) the beneficiary of Nina Wang’s estate under an earlier will (if Tony Chan’s will was valid). The Secretary for Justice was also a party as guardian of charities. It was Tony Chan’s case that he was on intimate terms with Nina Wang, a widow and much older woman. The probate action attracted great public attention and Tony Chan, a married man with children, great opprobrium.

3. Mr Gilbert Leung Kam Ho (“Gilbert Leung”) was a witness for CCFL. He began his evidence on the 8th day of the trial and was cross-examined by Mr Ian Mill QC, leading counsel for Tony Chan,[2] on an article in the Apple Daily of 7 May 2009 which stated that in July 2007, shortly after Nina Wang’s death, Chinachem sold a piece of land in Tai Po (the “land”) to his company for $1.01 million although it had a conservative estimated value of $10 million. Gilbert Leung said the land was not sold to him at an undervalue and that he had not attempted to estimate the value of the land at all. In order to undermine Gilbert Leung’s credibility, on the 9th day of the trial (21 May 2009), Mr Mill before he continued with his cross-examination produced to the trial judge (Lam J as he then was) and the parties a bundle of documents which included a lot index plan, a land search and a document in Chinese (the “Document”) which purported to be an investment proposal for the development of the land into a cinerarium. Mr Mill explained that the Document would be used to attack Gilbert Leung’s independence as a witness because he had received a very large financial benefit from Chinachem shortly after he provided a witness statement for use in the Probate Action.

4. Lam J wanted to know the provenance of the documents and these exchanges took place in open court:

“His Lordship: It depends on how the questions are put. Perhaps, Mr Mill, can you tell us the provenance of these Chinese documents before I decide whether ---

Mr Mill: Yes, I can, my Lord. The individual who provided it to us is a Mr Edmund Tsang.[3] He says that he was given that by Mr Gilbert Leung.

His Lordship: Yes, who is this Edmund Tsang and on what occasion was he given this document?

Mr Mill: My Lord, as I understand it, Mr Leung was trying to interest Mr Tsang in the investment, but that’s the extent of my understanding, my Lord.”

5. It is not disputed that the Document was prepared by Mr Gilbert Leung and it showed under the heading “Property Valuation” that if the land was developed as a cinerarium which was permitted under relevant town planning zoning, there would be gross revenue after development of some $360 million at a construction cost of approximately $10 million. As Yuen JA pointed out in the Court of Appeal,[4] on its face the Document appeared to contradict the evidence which Gilbert Leung had given.

6. Gilbert Leung accepted in cross-examination by Mr Mill that the document was made by him[5] and he also said that he had discussed the business proposal made in the Document with the plaintiff.[6] & [7] However, in this litigation, it has always been accepted that the Document had not been provided to Tony Chan’s team by Mr Tsang and the statement that it had been provided by him was untrue.

7. The statement was widely reported by the media and Mr Tsang sought to correct the untruth by, inter alia, issuing press releases in five major newspapers on two separate days and incurred expenses of about HK$5 million.[8] It is not disputed that the exchanges in court and the press reports were protected by absolute privilege. This appeal is concerned with the out of court communication of the untrue statement to Mr Mill and Mr Midgley.

8. In order to obtain the identity of the person who provided this false information to Tony Chan, the plaintiff applied for and obtained a Norwich Pharmacal order against Tony Chan compelling him to disclose “(the informant’s) identity and the contents of his/her communication with (Tony Chan) or his legal representatives to the effect that it was (the plaintiff) who provided the document.”[9] Following the disclosure of the defendant’s name, the present action was brought for malicious falsehood as well as for defamation based on the natural and ordinary meaning of the publication as well as by way of innuendo. It was the plaintiff’s pleaded case that the words “Edmund Tsang” in the exchange quoted in para 4 above, were false and defamatory and were based:

“… on instructions [Mr Mill] heard from the Defendant when she was providing instructions to Mr Midgley, a partner in the firm Haldanes over the speaker phone in a mobile telephone conversation between the Defendant and Mr Midgley on the 21 May 2009…”[10]

The Trial

9. The action was heard before Mr Recorder Pow SC. At trial, the overarching defence was that the defendant’s communication with Mr Mill/Mr Midgley was protected by absolute privilege relying on the judgment of Devlin LJ (as he then was) in Lincoln v Daniels[11]under which absolute privilege might be afforded to the provision of the impugned information (the foreshadowing) if it is sufficiently closely connected with the actuality, i.e. the use of the information in court. The learned Recorder said:

“What Mr Mill did and said in open court was the ‘actuality’ that was undoubtedly absolutely privileged. The issue in this case is whether this absolute privilege applied also to the argued ‘foreshadowing of it’: the communication between Mr Midgley/Mr Mill and the defendant on the issue of provenance of the Document at a time when Mr Mill was imminently contemplating and intending to make use of the Document in the cross-examination of Gilbert Leung in open court proceedings.”[12]

10. The learned Recorder also said there was:

“… close proximity between the subject occasion/publication and Mr Mill’s actual utterance in open court in the course of making use of the Document.”[13]

“… it is a matter of necessity that absolute privilege should be extended to the communication (pertaining to the contents, purport and provenance of that document) between the provider of such document and the advocate/lawyer who was contemplating the use of that document in the cross-examination of a witness.”[14]

11. His Lordship concluded that “the communication between [Mr] Midgley/Mr Mill and the defendant over the mobile telephone on 21 May 2009 was protected by absolute privilege.”[15] This conclusion was determinative of the action. This overarching defence lies at the heart of this appeal and will be considered fully in due course.[16]

12. Naturally, the learned Recorder went on to deal with the action in case his conclusion on absolute privilege is wrong.

13. Mr Midgley was the plaintiff’s witness and testified under subpoena. His evidence which was accepted by the Recorder is also relevant to absolute privilege, and I will deal with it in some detail. Apart from what Mr Midgley said in his written response to a Law Society’s enquiry which will appear below, the judge summarised his evidence in these words:

“43. …

(1) The defendant became known to Mr Midgley when she claimed to be in a position to provide papers of a previous trial in which she was engaged with Gilbert Leung. To access the papers, she had to go to England. She said that the judge in that trial made remarks critical of Gilbert’s credibility. Arrangement was thus set up by the defendant rather enthusiastically to retrieve the relevant papers from her former solicitors in England. That was supervised by Mr McDonnell.

(2) The defendant also became involved in some other issues and amongst those issues in which she was involved, she [informed] the team that a third party can point to a document which would be useful in impeaching Gilbert Leung’s credibility. That third party however expected to be paid for the information. On the one hand, in order to advise client as to whether the information was worthy, the team had to see the document. On the other hand, the third party did not have confidence in letting Tony Chan’s team know...

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