It was a shocking turn of affairs. A respected former leader of Hong Kong was relentlessly pursued by lawyers and eventually thrown in jail as a criminal – before further examination established that he was not guilty of anything and had been wrongly imprisoned. It was a long nightmare for Donald Tsang Yam-kuen, a popular leader known as “Mr Bowtie”, and remains a dark tale in the city’s recent history. Former top judge Henry Litton tells the full story.
WHEN CONSIDERING THE STANDING of the Chief Executive of Hong Kong, one case deserves attention: HKSAR v Tsang Yam Kuen, Donald [2019 HKCFA 24].
This was the criminal prosecution of a former CE.
It should have been taken as a most serious matter, not simply as another humdrum criminal case. The CE was, after all, someone who “represented Hong Kong”, and had been appointed by the Central Government as “a person of integrity”, carrying with him a presumption of “devotion to duty”: see Article 47 of the Basic Law.
COMMON SENSE
And yet the record shows that the matter had not been deeply considered before the prosecution was launched and, as so often happens, a “black letter” approach was taken in the proceedings, without thought being given to the societal background against which a CE must operate, and the common sense of the matter.
No CE assumes office without having led an active life as a Hong Kong citizen, with societal contacts, ties and friendships in the background.
To be in tune with the community, he cannot be expected to lay aside all that, and stand aloof from his fellow citizens. If he does, the reproach would be that he is “supercilious”, “out of touch”, and so on. If the contrary, he would be accused of being too “cosy” with important people or engaged in “cronyism”. If an issue should arise out of this, it is, in a sense, a question of his style of governance, outside the field of criminal law.
THE FACTS
Mr Tsang had a close and trusting relationship with a mainland businessman named Mr Wong, who held a 20 per cent share in a Hong Kong company called WML.
In late 2009, the government invited applications for digital sound broadcasting licences. In April 2010, four applications were received, one of them being WML’s. The applications were examined by the Broadcasting Authority (BA) and the Commerce and Economic Development Bureau (CEDB). Three were approved by those bodies, including that of WML. They so reported to the CE in Council.
PURELY FORMAL ACT
Under the Telecommunication Ordinance it was the CE in Council, and no one else, who had the authority (and responsibility) to grant such licences. Nothing controversial regarding those licences arose. The matter having been thoroughly examined by expert bodies (the BA and the CEDB), the grant of licences by the CE in Council was a purely formal act, requiring no separate consideration by the Council.
Moreover, there was no expertise within the members of Council who could have made a decision different from that of the BA and CEDB.
AN ISSUE ARISES
But the issue which arose was this: Mr Tsang’s term as CE was due to end on 30 June 2012. Mr Wong owned a residential property in Shenzhen.
In early 2010, Mr Tsang had talks with Mr Wong about leasing that property for himself and his wife upon retirement. It needed extensive renovation. Mr Tsang engaged the services of a well-known interior designer Mr Ho. The cost of renovation was estimated to be HK$ 3.5 million.
As neither Mr Wong nor Mr Tsang testified at the subsequent trial, there are aspects of the case unexplained, and seem rather odd and murky. Apparently the Tsangs were to take a lease of the property for only three years, at RMB800,000 per annum, the cost of renovation being undertaken by Mr Wong. All this was orally agreed.
On 17 November 2010, Mrs Tsang paid RMB800,000 to a company associated with WML. It was only much later, after the ICAC had begun an investigation into the whole affair, that solicitors for Mr Tsang produced, in September 2013, a lease of the property dated 21 February 2012.
“COSY RELATIONSHIPS”
In February 2012, the media began to show interest in what was alleged to be cosy relationships (or, in the words of the CFA, “improper associations”) between Mr Tsang and prominent business people.
Mr Tsang responded to those allegations by giving several media interviews (what the CFA referred to as “damage control”). Of particular relevance was one given on a programme called Beautiful Sunday on 26 February 2012, in which he explained his conduct in relation to the Shenzhen property. The transcript of that interview eventually formed the substance of Mr Tsang’s defence at the criminal trial.
What he said at that interview was rambling and, at times, almost incoherent. In essence, what he said was:
(1) The grant of broadcasting licences to the three applicants (including WML) was purely formal: “the involvement of the Executive Council was very little”, all aspects of those applications having been closely studied by the BA and the CEDB, and “they had a unanimous consent for approval”.
(2) The tenancy of the property was at market rent: in other words, he was not receiving any favours from Mr Wong.
(3) There was nothing he needed to declare or disclose to Exco.
CRIMINAL CHARGES
Be that as it may, two criminal charges were laid against Mr Tsang:
( 1 ) Under s. 4(2B)(a) of the Prevention of Bribery Ordinance in that he, being CE and President of the Executive Council… accepted an advantage, namely refurbishment and re-decoration of a three-storey residential property at Futian, Shenzhen as an inducement to or reward for him performing acts in his capacity as the Chief Executive and President of ExCo, namely, considering and making decisions in relation to applications by MWL… for a sound broadcasting licence… and formally granting such licence;
( 2 ) Misconduct in public office, contrary to common law, in that he, as CE and President of Exco wilfully misconducted himself by failing to declare or disclose to, or by concealing from, Exco his dealings and negotiations with Mr Wong in respect of the Shenzhen property when he was involved in decision-making in relation to WML’s application for a sound broadcasting licence.
THE PROSECUTION CASE
From the outset, the prosecution case as presented in court was that the two charges were “linked”. And that immediately presented a difficulty. If Mr Tsang was guilty of corruption, what was he supposed to declare at Exco meetings, in dealing with this matter? That he had accepted a bribe from Mr Wong?
Of the two charges, the first was by far the more serious. One wonders why the second charge was thrown in at all. If Mr Tsang was guilty on charge 1, criminal misconduct on charge 2 would have been subsumed on the first charge.
As regards charge 1, the alleged bribe was simply this: that the refurbishment of the Shenzhen property by Mr Wong was an “advantage”, received by Mr Tsang, as an inducement or reward for the grant of the radio broadcasting licence.
NO MOTIVE
Mr Tsang’s answer was that the two matters were unrelated: the CE in Council was dealing with three applicants (one of them being WML in which Mr Wong was a shareholder) and there was nothing to distinguish between the three.
By the time the BA and CEBD had made their unanimous recommendations, the grant of licence was a purely formal act.
There was no conceivable reason why Mr Wong should have offered any advantage to the CE for such act. Furthermore, the refurbishment constituted no particular advantage, as the RMB800,000 rent was at “commercial rate”, reflecting the refurbishment cost.
As can be seen, Mr Tsang’s answer to the two charges was substantial. And, of course, to convict, the prosecution carried the burden of proof of criminal intent beyond reasonable doubt.
VAGUE AND PREJUDICIAL
Confusingly, at trial, although the prosecution emphasized that charges one and two were “linked”, the jury was also instructed by the judge to consider the charges separately.
If Mr Tsang was guiltless on charge one, what was he supposed to declare on charge two? Here, the prosecution relied on vague generalities: the accused was “hopelessly compromised”; he was “involved in furthering his own private interests”, he was engaged in “untoward conduct”, and so on.
These vague and prejudicial comments came nowhere near criminal misconduct on the second charge, which required proof of criminal intent beyond reasonable doubt.
As the Court of Final Appeal (CFA) said (para 44): “The circumstances might well have been regarded as savouring of cronyism… ” and some of the acts (such as the late production of the lease) “suspicious”; these came nowhere near enough to “justify a conclusion of criminal misconduct”.
THE OUTCOME AT TRIAL
In the outcome, the jury was unable to reach a verdict on charge one, but convicted Mr Tsang on charge two.
FURTHER PROCEEDINGS
The prosecution put Mr Tsang on trial again on charge one, but again the jury failed to reach a verdict: showing that a Hong Kong jury had far more common sense than lawyers acting for the government.
Mr Tsang took the conviction on charge two to the Court of Appeal. Shockingly, that court unanimously upheld the conviction, but reduced the sentence of 18 months in prison for 12 months, which Mr Tsang served in full.
It took a further appeal to the CFA for the conviction and sentence on the second charge to be quashed.
In the end, Mr Tsang came out guiltless.
CONCLUSION
When a decision was made to put Mr Tsang on trial, what he had to say about the Shenzhen property transaction was already public knowledge. How any lawyer viewing those facts carefully could have come to the conclusion that he was guilty of bribery and corruption, beyond a reasonable doubt, is a mystery.
At what level the decision was made by the Secretary for Justice’s department to prosecute is unknown.
But to put him on trial again a second time, on the same material, when the jury could not agree to convict the first time, was an outrage.
The prosecution had wrong-footed itself at the outset by throwing in charge two: an ambiguous common law offence. It made the process far more complicated, and confusing for the jury. This was the work of black-letter lawyers unable to see the wider picture.
The result was that a former CE was subjected to a ramshackle process spanning many years, with all the anxieties this brought, and the indignity of imprisonment.
A person who formerly represented Hong Kong was crushed and humiliated. The CFA finally quashed the conviction and sentence, but could never restore the SAR’s reputation.
Mr Tsang should never have been prosecuted, as the result shows.
If a former CE could be treated in this shabby way, how could the common man be confident that the law would protect his innocence?
The report above is the second of a two-part series on attacks on Hong Kong’s Chief Executive by lawyers in the city. Click this phrase to read part one.
The Honorable Henry Litton was Permanent Judge of the Court of Final Appeal in Hong Kong from 1997 to 2000.
He has written a number of articles reviewing legal themes in Hong Kong law. To see all of them, click here.