NUMERIC CITY LTD v. LAU CHI WING

DCMP 2850/2015

MISCELLANEOUS PROCEEDINGS NO 2850 OF 2015

______________________

______________________

_____________

DECISION

_____________

1.  The applicant (“Numeric City”) applies for leave to appeal against my refusal of its application (“Originating Application”) for committing the respondent (“Lau”) to prison for contempt of court in making a false statement, namely, his witness statement dated 31 March 2014 filed in DCCJ 1347/2013 (“Lau’s Statement”) without an honest belief in its truth.

2.  In DCCJ 1347/2013, a Madam Shi (“Shi”) claimed against Numeric City for possession of a property in Causeway Bay (“Property”) which in turn was the subject property of a tenancy dispute in DCCJ 3996/2011 in which a Madam Chan (“Chan”) claimed arrears of rent from Lau.  In DCCJ 3996/2011, Lau filed a homemade defence admitting himself to be a tenant of the Property (“Lau’s Defence”). 

3.  Lau served as one of Shi’s witnesses and gave evidence in DCCJ 1347/2013.  This time Lau retreated from the position he took in Lau’s Defence and alleged in Lau’s Statement that he was in fact not a tenant of the Property and explained, inter alia, that his admission to have rented the Property from Chan in Lau’s Defence was made out of a “sense of bitterness” (發晦氣) and that the payments he made to Chan were in fact gratuitous payments for Chan’s support of her mother rather than payments for the use of the Property. 

4.  DCCJ 1347/2013 was tried by Deputy District Judge K W Wong.  In his judgment dated 30 July 2015 (“Judgment”), DDJ Wong found Shi, Lau and another witness of Shi to be untruthful witnesses and their evidence incredible and unreliable.  More pertinently, he found Lau to be a tenant of the Property.

5.  In paragraph 83 of the Judgment, DDJ Wong comments that Lau may be criminally liable in making inconsistent statements verified by statements of truth and states that if action is to be taken on the matter, Numeric City should do so pursuant to Order 41A, rule 9 of the Rules of the District Court (“Judge’s Remark”). 

6.  In an ex tempore ruling of mine (“my ruling”), I dismissed the Originating Application with costs against Numeric City, hence this leave application.

7.  Section 63A of the District Court Ordinance, Cap 336 provides that leave will be granted if:-

(a) the appeal has a reasonable prospect of success; or

(b) there is some other reason in the interests of justice why the appeal should be heard.

8.  In KNM v HTF (HCMP 288/2011), unrep., 7 September 2011, Hartmann and Fok JJA (as they then were) had this to say:-

“ 8. Leave to appeal shall not be granted under section 63A of the District Court Ordinance unless this court is satisfied that the appeal has a reasonable prospect of success or there is some other reason in the interests of justice that the appeal should be heard.

9. The relevant test of whether an appeal has a reasonable prospect of success under section 63A is whether the applicant for leave can show that he has an arguable case with reasonable chances of success on appeal. A reasonable prospect of success therefore means an appeal with prospects that are more than “fanciful” but which do not need to be shown to be “probable”.”

9.  When it comes to findings of fact made by a trial judge, the Court of Appeal would only reverse a finding of primary fact if it is satisfied that the finding is plainly wrong.  If not so satisfied, it would defer to the trial judge’s conclusion even if in some doubt as to its correctness.  See Ting Kwok Keung v Tam Dick Yuen & Others (2002) 5 HKCFAR 336.  Note also the Court of Appeal’s discussion of the relevant principles on an appeal on fact in Singh Harjit v Determination Business Limited trading as Muse Studio (CACV 68/2015) at §§6-9 and China Gold Finance Limited v CIL Holdings Limited (CACV 11/2015), unreported, 27 November 2015 at §§11-24.

10.  Numeric City’s leave application is based on the following grounds:

(1) I wrongly concluded that the finding of DDJ Wong in DCCJ 1347/2013 as per the Judgment could only be regarded as a finding on proof of balance of probabilities, there being a failure on my part to give adequate consideration to the Judge’s Remark;

(2) I wrongly concluded that Lau was only disbelieved by a civil court and there is nothing else to prove the falsity of the Statement to the requisite standard of proof beyond reasonable doubt when:

(i) Lau’s Statement in which Lau denied that he was a tenant of the Property is completely contradictory to Lau’s Defence in which he admitted otherwise so that Lau’s Statement and Lau’s Defence cannot be both true;

(ii) Lau’s explanation for his admission to be a tenant in Lau’s Defence does not make sense and is clearly incredible;

(iii) Lau’s admission to be a tenant in Lau’s Defence tallies with Chan’s evidence in DCCJ 1347/2013;

(iv) DDJ Wong in DCCJ 1347/2013 found Lau to be a tenant of the Property; and

(v) Lau has not put in evidence to contest the contention that Lau’s Statement is a false statement.

(3) I did not articulate in my ruling in which respect there is a reasonable doubt as to the falsity of Lau’s Statement;

(4) The evidence herein shows Lau’s Defence to be a true statement. Even if both Lau’s Statement and Lau’s Defence are both false, Lau has still committed contempt of court for making the false Lau’s Statement.

First Ground

11.  Numeric City’s reliance on the Judge’s Remark is misconceived when it is no more than a general comment that Lau may have brought upon himself criminal liability by making contradictory statements in various court documents without specific reference to any particular document in respect of which criminal liability may be attached to Lau.  Mr Cheung, Counsel for Numeric City, submits that it is evidently clear that DDJ Wong must have had in mind Lau’s Statement.  This might or might not be so.  Insofar as Numeric City suggests that the Judge’s Remark indicates that DDJ Wong was satisfied beyond reasonable doubt that Lau had made a false statement by way of Lau’s Statement without an honest belief in its truth, however, the same must be rejected.

12.  As said in my ruling, it is beyond dispute that the court in DCCJ 1347/2013 must have applied the civil standard of proof in coming to a finding.  This is reflected in the tenor of the reasoning in the Judgment and, in particular, paragraph 76 of the Judgment which cites the fact that the court had carefully considered the evidence adduced by both parties before coming to a finding as to whose evidence to prefer.  In my view, the underlying basis of the finding is clearly one of preponderance of evidence commensurate with the civil standard of proof.

13.  All in all, nowhere in the Judgment can I find any indication of the court there having been satisfied beyond reasonable doubt that Lau had made a false statement before rejecting his evidence as being incredible and unreliable.  In any event, as the judge now seized of the matter, I am duty bound to independently assess all available evidence before me.  That I may share the Judge’s Remark does not suffice for the present purpose.

14.  In paragraphs 23 to 25 of my ruling, I stated my observation from reading the transcript of Lau’s evidence given before DDJ Wong that Lau had on several occasions exercised the right to silence in the face of questions in cross examination that might invite self-incriminating answers. This served to highlight the lack of clear evidence (such as Lau’s own admission), other than the trial judge’s finding on a balance of probabilities, to show Lau’s Statement to be a false statement made without an honest belief in its truth.

15.  Indeed, the highest Mr Cheung can put in his written submission is that the Judge’s Remark indicates that the trial judge is of the view that the evidence may also be sufficient to prove, on the criminal standard, that Lau had made a false statement.  That being so, it remains for this court to decide on the basis of all available evidence, aside from the Judge’s Remark, as to whether it is beyond reasonable doubt that Lau’s Statement is a false statement made without an honest belief in its truth.

16.  In the circumstances, I see no merits in the First Ground.

Second Ground

17.  This ground relates to my demur (without ruling) at paragraph 27 of my ruling with Mr Cheung’s proposition that, when someone gives two statements that are inconsistent with each other, one of them must be false absent good explanation.  I said I could not exclude any possibilities that inconsistent statements could be both true or even both false. 

18.  For the present purpose, Mr Cheung submits that there can only be three permutations out of this scenario, namely, that the two statements are both true; that one is true and the other false; and that they are both false.  As Lau’s Defence and Lau’s Statement are completely contradictory to each other, they cannot be both true.  As there is no evidential basis for saying that the two statements are both false, the only realistic permutation is that one of them is true and the other false.  Mr Cheung then goes on to analyse the contents of the two statements of Lau before submitting that there is nothing which may cast any reasonable doubt on Lau’s admission in Lau’s Defence that he was a tenant of the Property so that it must follow, beyond any reasonable doubt that what Lau said in Lau’s Statement is untrue.   

19.  Interesting as this analysis a priori may be, there is an important fact that Mr Cheung has failed to highlight from the Judgment, that is, Chan’s claim for arrears of rent against Lau in DCCJ 3996/2011 (in which Lau’s Defence was filed) was settled without trial.  What Lau said in Lau’s Defence or his evidence in support thereof was therefore never put to test or challenge and there is no way one can say with certainty, or for that matter a high degree of probabilities, that what Lau said in Lau’s Defence must be true in every sense of the word. 

20.  In dismissing as incredible Lau’s explanation in DCCJ 1347/2013 for retracting his admission in Lau’s Defence, all Mr Cheung manages to do is to refer to the apparently unequivocal terms of Lau’s admission in Lau’s Defence and the cheques he exhibited as evidence of rental payment in DCCJ 3991/2011.  With these, the highest one can put it is that it is more probable than not that Lau’s Defence reflects the truth.  But this would not suffice for the purpose of proving beyond reasonable doubt that Lau’s Statement is a false statement made without honest belief in its truth.

21.  Indeed, Mr Cheung accepts that there could be at least a third explanation for Lau’s occupation of the Property, namely, that Lau’s occupation of the Property was pursuant to Chan’s licence, with or without the authority of the registered owner.  However, he invites this court to dismiss the same as a mere theoretical possibility rather than a real one.  In so doing, he refers to the lack of evidential basis for one to say such a possibility could have existed and that if it did represent the truth Lau would have said so.

22.  Suffice it to say I am unable to dismiss the possibility of there being some other explanation for Lau’s occupation than Chan’s case by reference to the limited evidence available to this court.  In any event, the mere fact that Lau’s occupation of the Property, which lasted for a fairly long period, could have been explained by something other than a simple tenancy agreement suffices for this court to say Lau’s Defence, or for that matter Chan’s statement of claim, does not necessarily represent the whole truth even if there is some truth in it.

23.  That being so, Mr Cheung’s conclusion is at best one drawn from a philosophical exercise without evidential basis and as such must be rejected insofar as the same is proffered as a ground of appeal.  

Third Ground

24.  This ground is premised on Mr Cheung’s criticism that I had not articulated in my ruling as to any reasonable doubt on the falsity of Lau’s Statement.  I do not propose to defend the way I presented my reasons in my ruling other than saying that there is no need to explain the obvious. 

25.  As said in paragraphs 23 and 24 of my ruling, if a civil court is in a position to elevate a conclusion reached on a civil standard to one that can only be arrived at using the criminal standard of proof, there must be something else but that something else is missing in the present case.  Should clarification be required at all, I would say in the other way round that a court cannot jump, without more, from a conclusion as to which witness is to be believed or disbelieved reached on a balance of probabilities to a conclusion that the witness whom the court disbelieves has committed a criminal contempt of court by making a false statement without an honest belief in its truth.  Here, on top of the able analysis and finding of DDJ Wong, all Mr Cheung can point to is the contradictory statement in Lau’s Defence which, for the reasons given above, would not suffice for the present purpose.

26.  At paragraph 26 of my ruling, I said that on the basis of the evidence before me, I might have come to the same conclusion as DDJ Wong did but I would still be applying the civil standard of proof and would never be able to be satisfied beyond reasonable doubt that Lau was in fact making a false statement before the court.   By this, I should not be taken to be saying that in a civil setting, the court can never be satisfied beyond reasonable doubt that one has committed a criminal contempt of court.  Each case turns on its own facts.  All I am saying is that evidence in the present case is not such as to enable this court to come to such a finding.

27.  Mr Cheung submits that in the absence of credible explanation from Lau as to his retraction in Lau’s Statement of the admission in Lau’s Defence, there is nothing which casts any reasonable doubt that Lau’s Statement is false.  This submission is premised on the dichotomy of Mr Cheung’s proposition that one of the two inconsistent statements of Lau must be true (and that what Lau said in Lau’s Defence must be true).  For reasons given above, this must be rejected.  

28.  There is therefore nothing in this ground.

Fourth Ground

29.  Mr Cheung’s proposition here is that even if both Lau’s Statement and Lau’s Defence are both false, Lau has still committed contempt of court for making the false Lau’s Statement.  While this proposition is logically true, the question remains whether Numeric City has proven beyond reasonable doubt that Lau’s Statement is a false statement made without honest belief in its truth.  I do not propose to repeat the reasons for my answer in the negative.  For the present purpose, I need only say that this proposition does not avail Numeric City of any independent ground of appeal with any reasonable prospect of success.

Numeric City need not show this court’s decision to be plainly wrong?

30.  Mr Cheung submits that for leave to be granted to appeal from my decision, Numeric City need only show a reasonable prospect of the appellate court coming to a different opinion because my finding as to whether it is proven beyond reasonable doubt that Lau’s Statement is a false statement made without an honest belief in its truth is not a finding of primary or even secondary facts so as to require Numeric City to show the same to be plainly wrong.  As to the basis for submitting the existence of a reasonable prospect in this regard, Mr Cheung again relies on Lau’s Defence which he believes he has shown to be true.  

31.  Accepting for the present purpose that Mr Cheung is right to say my finding is not a finding of primary or secondary facts, I still do not see a reasonable prospect of the appellate court coming to a different opinion when Numeric City’s case is founded on Lau’s Defence being the true statement.

Conclusion

32.  I am not satisfied that the intended appeal by Numeric City has any reasonable prospect of success.  Accordingly, Numeric City’s application is dismissed.

33.  Numeric City is to pay Lau’s costs of this application, summarily assessed at $23,000 and payable forthwith.

DCMP 2850/2015

IN THE DICTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 2850 OF 2015

______________________

_______________________

____________

R U L I N G

____________

1. This is an application by the plaintiff for an order that the defendant, Mr Lau, be committed to prison for contempt of court in making a false statement, namely, his witness statement dated 31 March 2014 filed in DCCJ 1347/2013 which is verified by his statement of truth, without an honest belief in its truth.

Background

2. This application arose from what would otherwise be a dispute between landlord and tenant in a previous District Court action, namely DCCJ 3996/2011, where one Madam Chan Kam-fong, as administratrix of the estate of one Madam Ko, sued Mr Lau for arrears of rent in respect of a residential unit in Causeway Bay.  There, Mr Lau filed a defence admitting himself to be the tenant of the residential unit in question. 

3. As it turned out, a third party commenced action in this court under DCCJ 1347/2013 against the plaintiff in the present application, namely, Numeric City Limited, in respect of the residential unit in question.  Very briefly, that third-party, one Madam Shi, claimed for possession of the residential unit on grounds of proprietary estoppel and/or constructive trust.

4. In this subsequent action, Mr Lau, this time served as a witness of Madam Shi and gave evidence on her behalf.  In a nutshell, Mr Lau this time retreated from his earlier position as per his defence in DCCJ 3996/2011 and said he was in fact not the tenant of the residential unit and he gave reasons for changing his position regarding the existence of any tenancy with Madam Chan.

5. The action by Madam Shi against Numeric City went before Deputy District Judge Wong who heard evidence from, inter alia, Mr Lau.  In his judgment dated 30 July 2015, the learned deputy judge at paragraph 63 set out in detail his analysis of Mr Lau’s evidence given in the action before him, as well as those given in the previous actions, including that Mr Lau gave in DCCJ 2647/2012, and found Mr Lau’s evidence in the case before him to the inconsistent in a material way with his defence filed in the previous actions.

6. In no less than seven subparagraphs, the learned deputy judge analysed the evidence before coming to the conclusion that,in Chinese, at paragraph 64: “很明顯，劉的證供有很多自相矛盾及不合常理、邏輯之處。即使原告人的大侓師亦同意，劉的口供未能與書面證供互相佐證”.

7. The learned judge went on at paragraph 68 to conclude that, again in Chinese: “仔細考慮原告人劉”, that is, Mr Lau, “及李”, another witness, “的證供，本席裁定他（她）”, again, “他們全部不是誠實可靠的證人，他（她）們的證供不可信及不可靠。劉在多次給予法庭答辯並簽署屬實的文件中互相矛盾。他一方面承認自己是租客（DCCJ 3996/2011 及 DCCJ 2647/2012) ，但又在本案否認。他的證供充斥著謊言。本席拒絕接受他（她）們的證供。”.

8. It is pertinent to note also the learned judge’s remark at paragraph 83 of his judgment: “本席同意被告人的陳述，劉在多次給予法庭簽署屬實的文件中互相矛盾，可能觸犯刑責。若要採取行動，被告人應根據區域法院第41A號命令第9條規則提出。”.

9. Naturally, the learned judge found in favour of the defendant and against Madam Shi in that action.

10. The aftermath of that civil trial is the present application by the plaintiff against Mr Lau. Obviously, in light of the learned deputy judge’s remark at paragraph 83 of his judgment and the grounds of the application as amplified by Mr Cheung, counsel for the plaintiff, is that Mr Lau in the two statements he made on different occasions, namely, the defence in the previous action and the witness statement he made in the action before the learned deputy judge are inconsistent with each other.

11. Mr Cheung put forward the proposition that given the fact that the two statements are inconsistent, that is, on the one hand Mr Lau said he was a tenant; on the other he denied that he was a tenant in relation to the same residential unit.  So, Mr Cheung submits, one of the statements must be false.

12. Mr Cheung goes on to rely on the finding made by the learned deputy judge that the witness statements Mr Lau gave in the action before him was false.

13. In the circumstances, Mr Cheung submits this court is in a position to come to a finding beyond reasonable doubt that Mr Lau had made or had in fact made a false statement before the civil court and therefore should be committed for contempt of court.

14. Mr Cheung emphasised the purpose of Order 41A rule 9, that is, to discourage people from making false statements in civil proceedings. 

15. I should add that Mr Cheung’s proposition, that is, when two statements are inconsistent with each other one must be false, Mr Cheung’s proposition has this rider, that is, absent good explanation, one of the statements must be false. And Mr Cheung goes on to rely on the learned deputy judge’s findings to support the present application.  In particular, Mr Cheung invites me to consider the learned deputy judge’s analysis which I have referred to (that is the seven subparagraphs) in coming to a decision on the present application.

16. This application is of course opposed by Mr Lau.  Mr Siu, counsel for Mr Lau, submits that it is not sufficient for the plaintiff to simply rely on the proposition that one of the two inconsistent statements of Mr Lau must be false.  Mr Siu submits that the plaintiff must prove beyond reasonable doubt that the witness statements Mr Lau gave in DCCJ 1347/2013 is false.  That is to say, Mr Cheung’s proposition per se is insufficient.  There must be something else on which the plaintiff can rely to prove Mr Lau’s statement to be false.

17. Mr Siu highlights the fact that the plaintiff in the present application is simply relying on the judgment of the learned deputy judge in DCCJ 1347/2013 which was made on balance of probabilities.

18. In this connection, Mr Siu fairly accepts that in his judgment the learned deputy judge did not mention the standard of proof applied in his finding and in coming to his conclusion that Mr Lau’s evidence was to be disbelieved.  That said, I believe it is beyond dispute that the court in DCCJ 1347/2013 must have applied the civil standard of proof in coming to the finding as the learned deputy judge did there.  In any event, I am not aware of the court there having ever said it was satisfied beyond reasonable doubt that Mr Lau had made a false statement in the action before him or before Deputy Judge Wong.

19. Therefore, Mr Siu submits, putting the plaintiff’s case to the highest, it is no more than saying that it is likely that the witness statements of Mr Lau is false and thereforefails to meet the necessary standard for committal purposes.

20. In addition, Mr Siu has sought to argue before me that the plaintiff in obtaining the leave of this court for commencing the present proceedings had committed an act of material non-disclosure in the leave application.  However, as the defendant, or Mr Lau, has not filed any evidence before me, I am unable to allow Mr Siu to pursue this line of argument and Mr Siu fairly indicates that he would not be pursuing this line of argument and would be relying on what I have set out in the above in opposition to the application.

Finding

21. In my view, Mr Siu must be right.  The hearing before the learned deputy judge is no doubt a hearing conducted as a civil matter and there is no indication whatsoever that the court there in coming to a finding that Mr Lau’s evidence was to be disbelieved arrived at the conclusion on the criminal standard of “beyond reasonable doubt”.

22. However careful the analysis of the learned deputy judge may be, and I would say with respect that the learned deputy judge’s analysis has much to be commended, the position, however, remains that the conclusion was arrived at on the civil standard of proof.  Mr Cheung says on the evidence before me this court should be able to come to a finding beyond reasonable doubt that Mr Lau had made a false statement in DCCJ 1347/2013.  With respect, this cannot be right.

23. I have carefully considered the transcript of Mr Lau’s evidence given before the learned deputy judge.  I have also read and I am fully aware of what Mr Lau had said in the defence filed in the previous actions.  Clearly, Mr Lau had given inconsistent statements on different occasions and he was disbelieved by a civil court subsequently.  But this is something that happens in many civil trials.  If a civil court is in a position to elevate a conclusion reached on a civil standard to one that can only be arrived at using the criminal standard of proof, then as Mr Siu submits there must be something else.

24. In the present case, that “something else”), in my view, is missing.  Look at the transcript for instance.  On no less than two occasions the learned deputy judge reminded Mr Lau, when the latter was being cross-examined by the plaintiff’s counsel, that he had a right to remain silent in face of questions that may be inviting answers that would incriminate Mr Lau himself.  On at least several occasions, as can be seen on from the transcript, Mr Lau did exercise his right to silence during cross-examination.

25. For instance, at 332 of bundle of transcripts there are these questions and answers in excerpt:“問：究竟邊一個版本先係真㗎？你係私贈比高麗娟定係你交租比陳錦芳？喺你抗辯裏面邊個版本先係真㗎？”  Subsequently, Mr Lau answered, “私贈係真嘅”.  This was followed by another question:“即係你喺抗辯書裏面講話係租金係假嘅?”  Mr Lau answered, “亦都唔係假嘅”.  Counsel asked, or rather, persisted with his questioning and Mr Lau gave this answer:“抗辯書係講租金”.  Counsel asked, or rather put to Mr Lau in this way:“係，呢個唔係真確嘅，唔係租金嚟嘅。好簡單之嘛，你抗辯書講咗租金，你講咗話係私贈就唔係租金喇，係唔係呀”.  There was no audible answer from Mr Lau for a while before he categorically said, “唔回答呢個問題”.

26. To put it simply, on the basis of the evidence before me, even though if I were the trial judge in the civil matter before the learned deputy judge, I might have come to the same conclusion for the reasons put forward by the learned deputy judge.  Still, I would very much be applying the civil standard of proof and would never be able to be satisfied beyond reasonable doubt that Mr Lau was in fact making a false statement before this court.

27. I should add that in relation to Mr Cheung’s proposition, that is when someone gives two statements that are inconsistent with each other, one of them must be false absent good explanation.  I am not entirely sure this is a universal truth.  I cannot exclude any possibilities that inconsistent statements can be both true or even both false.  But I do not have to make any ruling on this proposition as Mr Siu rightly points out that for the present purposes the plaintiff has the burden of proving beyond reasonable doubt that Mr Lau had made a false statement in DCCJ 1437/2013, and I conclude that the plaintiff has failed so to do. 

28. The plaintiff’s application must therefore be dismissed with costs and I am granting a certificate for counsel.

(Submissions on costs)

29. This being a summary assessment of costs and the court on authorities can take a global view of this matter rather than going into the nitty-gritties of the individual items of costs. In my view, given actually what I have said, that is, there will be counsel’s certificate, I take the view that this matter should attract no more than $23,000, and this is the global sum I am prepared to award to the defendant as the defendant’s costs in this application.

30. So my order would be, first, the application be dismissed; and the plaintiff do pay the defendant his costs summarily assessed at $23,000 and payable forthwith.