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HCAL 191/2021
[2021] HKCFI 3118
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST NO 191 OF 2021
________________________
| BETWEEN |
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TAM SZE LEUNG |
1st Applicant |
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TAM CHUNG WAI |
2nd Applicant |
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KONG CHAN |
3rd Applicant |
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LEE KA LO |
4th Applicant |
and |
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COMMISSIONER OF POLICE |
Putative
Respondent |
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Before: Hon Coleman J in Court
Dates of Hearing: 19-20 October 2021
Date of Judgment: 30 December 2021
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J U D G M E N T
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A. Introduction
1. In Interush Ltd v Commissioner of Police [2019] HKCA 70, [2019] 1 HKLRD 892 (“Interush”), the Court of Appeal rejected an application by way of judicial review for a declaration that sections 25(1) and 25A of the Organised Serious Crimes Ordinance Cap 455 (“OSCO”) are unconstitutional for being inconsistent with various protected rights under the Basic Law (“BL”) and/or the Hong Kong Bill of Rights Ordinance Cap 383 (“BOR”). The challenge arose in the context of so-called “letters of no consent” (“LNCs”) issued by the Commissioner of Police (“Commissioner”) in the context of section 25A of OSCO.
2. In the present proceedings, the Applicants seek leave to apply for judicial review of (1) the Commissioner’s decision to issue and maintain certain LNCs, and (2) the Commissioner’s failure or refusal to consent to the withdrawal of any funds from their accounts which were effectively frozen by the LNCs. They expressly raise the question of the legality and constitutionality of the regime (“No Consent Regime”) under which LNCs are issued.
3. The Applicants assert that most of the grounds of challenge raised by them were not decided in Interush. It is, therefore, necessary to consider what Interush did and did not decide, and the extent to which binding decisions impact the current proceedings, including as to the particular facts which give rise to the current proceedings.
4. The intended challenge arises in the context of the important and undisputed need for provisions to combat money laundering and to facilitate the pursuit and confiscation of proceeds of crime. The broad contest has been vividly described elsewhere – see §§8 and 9 of R (UMBS Online Ltd) v Serious Organised Crime Agency [2007] Bus LR 1317 – as being between (a) legislation of which Dracon, the Athenian legislator, would have been proud, and (b) a sharp but essential modern weapon in the fight against organised crime which gives law enforcement bodies the ability to counter-attack, and then pursue and recover the proceeds of criminal activity.
5. The central question posed in these proceedings is whether, in seeking to protect the community in relation to money laundering and related crimes, the public has been left under-protected in terms of their fundamental right to use their own property in the form of funds held in a bank account.
6. The proceedings were commenced by a Notice in Form 86 dated 18 February 2021 (“Form 86”). By his Decision dated 8 March 2021, Chow J (as he then was) refused the Applicants’ request that they be granted anonymity in the proceedings, and he gave directions for the filing of evidence and for a ‘rolled up’ hearing of (1) the application for leave to apply for judicial review, and (2) the substantive application for judicial review.
7. The ‘rolled up’ hearing was heard by me on 19 and 20 October 2021. Following the filing of evidence by the Commissioner, a disclosure/production summons issued by the Applicants on 14 September 2021 was not further pursued at the hearing.
8. The Applicants were represented by Mr Abraham Chan SC, leading Mr Timothy Parker and Mr Geoffrey Yeung. Mr Chan argued this case with the advantage (or disadvantage) of having been leading Counsel for the applicant before the Court of Appeal in Interush. The Commissioner was represented by Mr Victor Dawes SC, leading Mr Peter Dong and Mr Stephen Siu.
9. As Mr Chan submitted, the grounds of review “have been developed in detail” in the Form 86. This should not happen: see my recent reminder (albeit post-dating the Form 86 in this case) in [2021] HKCFI 2427. Applicants for judicial review should bring appropriate procedural rigour to judicial review cases, including in the drafting of the Form 86. The recent culture in the context of judicial review proceedings for there to be excessive prolixity and complexity, in what are supposed to be concise grounds for judicial review, as often as not serves to conceal rather than illuminate the essence of the case being advanced.
10. In this case, the Form 86 comprised over 60 pages of closely typed description and argument, which enabled Mr Chan’s “skeleton submissions” to be fitted into only 46 pages (if one does not count the further 50 pages provided by way of Notes in reply). Mr Dawes’ “skeleton submissions” ran to 83 pages. I do not suggest that the written materials were not of assistance, because they were (and had the additional benefit of saving some note taking whilst listening to submissions). But I strongly tend to the view that just as much assistance could come from far fewer pages.
11. This is my reserved Judgment.
B. The Facts
12. From the evidence, the following material factual matters can be seen.
13. The Applicants are Hong Kong permanent residents, and are members of the same family. Tam Sze Leung and Tam Chung Wai are brothers; Kong Chan is their mother; and Lee Ka Lo is Tam Chung Wai’s wife. They hold monies in a number of accounts (“Accounts”) held with various banks in Hong Kong (together, “Banks”), being The Hongkong and Shanghai Banking Corporation (“HSBC”), the Hang Sing Bank (“HSB”), the Bank of China Hong Kong (“BOCHK”) and the Bank of East Asia (“BEA”).
14. The combined total balance of the Accounts is substantial, apparently around HK$30 million to HK$40 million (including cash, and investments of fluctuating value). But, in December 2020, the Applicants discovered that the Accounts had become disabled, and they were unable to withdraw funds held in the Accounts.
15. Through their solicitors, Messrs O Tse & Co (“OTC”), the Applicants enquired with the Banks as to the reasons for the freezing and/or restriction of the Accounts. The replies from the Banks were not particularly informative. In short, the Banks identified that they were not in a position to accede to the request.
16. The Applicants and OTC inferred that LNCs had been issued by the Commissioner in respect of the Accounts. In particular, it was noted that all of the Accounts were believed to have become inoperable at or around the same time, and it was extremely improbable that four competing financial institutions would independently decide to freeze 12 accounts belonging to four different people at exactly the same time. Further, some responses to enquiries made of the Banks appeared standard ‘detail-free’ responses typical to LNC cases.
17. By a letter dated 8 December 2020, OTC asked the Police to confirm whether LNCs had been issued to the Banks in respect of the Accounts, and provide the legal basis, including the legal provisions relied upon, as well as the reasons (including what offence was alleged or suspected to have been committed and by whom and how it related to any or all of the Accounts), for issuing the LNCs.
18. By a letter dated 14 December 2020, the Commissioner informed OTC that the Applicants were “currently under investigation by Financial Investigations Division, Narcotics Bureau for a case of ‘Dealing with property known or believed to represent proceeds of indictable offence’”, and asked OTC to ask the Applicants to contact the Police. No further substantive reply was given by the Police despite further letters from OTC. Nor did the Applicants contact the Police as they had been invited to do.
19. In the Form 86, the Applicants stated that it may be inferred that the Commissioner:
(1) had issued LNCs to the Banks, thereby causing the freezing and/or restriction of the Accounts; and
(2) had decided not to accede to the Applicants’ request to provide reasons, including the legal basis, for the issuance of the LNCs.
20. The Form 86 also referred to searches conducted in 2019 and 2020 by the Securities and Futures Commission (“SFC”) at premises occupied and/or owned by the Applicants, in connection with what were said to be suspected offences contrary to sections 274, 275, 278, 295, 296, 299 and/or 300 of the Securities and Futures Ordinance Cap 571 (“SFO”).
21. Up to the date of the Form 86, the SFC had not invited any of the Applicants for interview again, or arrested the Applicants, or charged or commenced proceedings against them. Also, the Applicants did not know at that time whether the LNCs were related to the matters investigated by the SFC, though they must have had at least a strong suspicion that they were.
22. But the evidence since filed for the Commissioner in these proceedings has made the picture much clearer.
23. The matter does indeed arise out of the SFC’s investigation against the Applicants and others for suspected stock market manipulation (“pump and dump”) in Hong Kong between 2018 and 2020.
24. On 25 November 2020, the SFC referred the matter to the Police for investigation against the Applicants for the suspected offence of money laundering under section 25 of OSCO. As a result of that referral, on 27 November 2020 the Joint Financial Intelligence Unit (“JFIU”) alerted HSBC, BOCHK and BEA to the fact that investigations concerning suspected money-laundering activities were being conducted, and urged the Banks to file appropriate suspicious transaction reports (“STRs”). The relevant emails included clear statements that LNCs would be issued. As...
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