COURT FILE NO.: EX-89/11

DATE: 20120202

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: The Attorney General of Canada on Behalf of the Republic of Korea (Applicant) and Lee Pyong Sik (Respondent)

BEFORE: Frank, J.

COUNSEL: Elaine Krivel, for the Applicant

Brian Greenspan and Robin McKechney, for the Respondent

HEARD: Sept. 16, 2011, Nov. 30, 2011 and Jan. 13, 2012

ENDORSEMENT

[1] The Attorney General of Canada seeks an order for the committal for extradition of Pyong Sik Lee, the respondent, as authorized by the Minister of Justice pursuant to an authority to proceed under section 15 of the Extradition Act, S.C. 1999, c.18. Mr. Lee is sought for prosecution by the Republic of Korea for offences that correspond to the Canadian offences of conspiracy to commit fraud and fraud contrary to sections 465 and 380(1) of the Criminal Code.

[2] Mr. Lee emigrated from The Republic of Korea to Canada and is now a Canadian citizen. He is alleged to have defrauded the Korean government of the equivalent of approximately 12 million Canadian dollars. The allegations against him are that he, in conspiracy with others, illegally applied for and obtained in the names of those others, government compensation for land the government had redeemed.

[3] The government redemption program was a response to fraudulent land transactions initiated by Mr. Lee’s father and participated in by Mr. Lee. Father and son were convicted and sentenced with respect to those frauds. They are not relevant to this application apart from providing a factual understanding of the alleged frauds with respect to which Mr. Lee’s committal for extradition is now sought.

[4] Identification is not an issue as Mr. Lee has agreed that he is the person sought for extradition.

[5] For the reasons that follow, I find that the evidence put forward by The Republic of Korea contains some evidence which is available for trial and is not manifestly unreliable on every essential element of the equivalent Canadian offences and is therefore sufficient to meet the test for committal.

The Extradition Hearing and the Authority of the Extradition Judge

[6] An extradition hearing is a screening mechanism intended to determine whether the requesting state has put forward sufficient evidence to warrant a committal for surrender. (U.S.A. v. McAmmond (2005), 2005 CanLII 20 (ON CA), 192 C.C.C. (3d) 149 (Ont. C.A.) at para. 8).

[7] Consistent with this, the extradition hearing is not a trial; like a preliminary inquiry, its purpose is to determine whether a trial should be held. (U.S.A. v. McVey, 1992 CanLII 48 (SCC), [1992] 3 S.C.R. 475 at para. 103-104). The test for committal is the same as at a preliminary inquiry: whether there is any evidence upon which a reasonable jury, properly instructed, could return a verdict of guilt on the offences set out in the authority to proceed. ( U.S.A. v. Ferras, 2006 SCC 33, [2006] 2 S.C.R. 77, at para. 39, citing R. v. Arcuri, 2001 SCC 54, [2001] 2 S.C.R. 828). Accordingly, the judge is not concerned with the strength of the applicant’s case or the likelihood of conviction. (U.S.A. v. Thomlison (2007), 2007 ONCA 42, 216 C.C.C. (3d) 97 (Ont. C.A.), at para. 42.).

[8] The jurisdiction of the extradition judge is statutory and limited. Pursuant to s. 29(1) of the Extradition Act, the judge is required to order the committal of the person sought into custody to await surrender if there is evidence admissible under the Act of conduct that, had it occurred in Canada, would justify committal for trial in Canada for the offences set out in the authority to proceed and the judge is satisfied that the person is the person sought.

[9] In considering the evidence, the judge must be mindful of the fact that legal cultures differ, and as a result, as the Court of Appeal stated in Hungary v. Toth, [2011] ONCA No. 532, at para. 33, “we must be careful not to expect that approaches or styles of legal documentation will necessarily follow familiar patterns.”

[10] Section 32 of the Extradition Act establishes what is to be admitted into evidence on an extradition hearing. It provides for the admission of a Record of the Case which must contain “a document summarizing the evidence available to the extradition partner for use in the prosecution.” The contents of the Record of the Case are to be admitted as evidence on the certification by a representative of the requesting state that the evidence contained in it is available for trial and is sufficient under its law to justify prosecution.

[11] This certification raises a rebuttable presumption that the evidence summarized meets the requisite threshold of reliability for admission and availability for trial: see Ferras, at para. 66-67.

[12] The extradition judge is afforded a limited scope for the weighing of the evidence. As the court stated in Arcuri, where the Crown relies on circumstantial evidence, the extradition judge must weigh the evidence in the limited sense of assessing whether it is capable of supporting the inferences the Crown asks be drawn. This weighing of evidence is not to determine guilt but rather whether the case could go to trial in Canada. As a result, the judge cannot decide issues of credibility or draw competing inferences: Ferras, at para. 70 and 53.

[13] As the court of Appeal has repeatedly stated, the Record of the Case provisions of the Extradition Act are concerned with substance rather than form and are intended to strike a balance between the liberty interests of the person sought and the international principle of comity. (U.S.A v. Lee (2009), 2009 ONCA 728, 258 O.A.C. 72, at para. 16).

[14] The extradition judge has the discretion to refuse committal where the judge is satisfied that the evidence is “so defective” or “so unreliable”, due to problems inherent in the evidence itself, problems that undermine the credibility or reliability of the source of the evidence, or a combination of those two factors, that it must be completely rejected. (U.S.A. v. Anderson (2007), 2007 ONCA 84, 218 C.C.C. (3d) 225 (Ont. C.A. at para. 30). However, as Moldaver JA stated in Thomlison, at para 45: where there remains some “available and reliable” evidence on every essential element of the parallel Canadian crime, on which a jury, properly instructed, could convict, the judge cannot refuse committal.

[15] With this background, I now turn to the facts.

Nature of the alleged fraud

[16] Subsequent to the imprisonment of Mr. Lee and his father for selling unlawfully acquired state-owned lands, the Korean government took action to redeem the property that the father and son had sold. In December 1997, it established guidelines for the compensation of good faith third party purchasers of these properties. The guidelines included that sixty-three identified relatives and acquaintances of the respondent’s father who had purchased these properties were excluded from the compensation scheme as they were deemed to be bad faith purchasers.

[17] The list of excluded purchasers was revised through the bribery by the respondent’s father of the official responsible for enforcing the guidelines. However, the respondent and his father remained specifically excluded.

[18] It is alleged that Mr. Lee, between April 2001 and September 2004, applied to the government for compensation, with the assistance of relatives and acquaintances, fraudulently claiming to have been purchasers in good faith. The government accepted these fraudulent applications and paid compensation to the named applicants. Mr. Lee is alleged to have benefited from these payments.

The Respondent’s position

[19] Mr. Lee’s position is that the presumption of reliability of the Record of the Case is rebutted. He submits that errors in the translation, factual contradictions and conclusions based on mere speculation contained in the Record of the Case result in it being manifestly unreliable and therefore incapable of supporting a committal.

[20] Further, he submits, relying on United Kingdom of Great Britain and Northern Ireland v. Tarantino, (20030, 2003 BCSC 1134, 177 C.C.C. (3d) 284 (B.C.S.C.) at para. 39 and 46, that a stay of proceedings should be entered because the Republic of Korea has not applied the requisite degree of diligence and accuracy to ensure individuals are not extradited on non-existent evidence and that court proceedings are not conducted and judgments reached on the basis of inaccurate assertions. Specifically, he argues that the translation of portions of the Record of the Case are false and deliberately misleading, that the contents of the Record of the Case are inaccurate and characterized by carelessness in their preparation.

Analysis

(i) Evidence to support committal

[21] The Record of the Case contains a summary of the evidence that includes the findings of the investigation conducted by the Board of Audit and Inspection, the findings of the Public Prosecutor’s Office, and eight statements or “will says” of the witnesses on whose evidence the Republic of Korea relies. It includes, as well, what are referred to as annexes. These are the documents that were produced in the investigation that was conducted in 2005, before the witness’s “will says” in the summary of the evidence were obtained.

[22] The following is evidence with respect to which there is no dispute as to availability, which is not speculative and with respect to which there is no direct dispute as to translation. In my view, this evidence is sufficient to satisfy the requirements for committal.

[23] Mr. Lee’s father, Lee Suk-ho, states that in October 2001, Mr. Lee told him that he had purchased land from his uncle, Choe Yoon-seop and obtained government compensation for it. The money banking documents with respect to the account into which the fraudulently obtained money had been deposited were given to him and he used the money. He also states that his former wife, Choe In-nam and their children, including Mr. Lee used the fraudulently obtained compensation proceeds.

[24] Mr. Lee’s father identifies the fraudulent compensation applications in which he had no involvement. These include an application of Kim Joong-ho, a friend of Mr. Lee’s brother-in-law, and of O Yong-hyun, Mr. Lee’s cousin. The father states that the fact that he did not apply in the names of these people means that it was done by Mr. Lee. Both Mr. Kim and Mr. O confirm this to have been the case.

[25] Mr. Kim states that he met with Mr. Lee who told him to fill out the application form for compensation and he did so. He states that the whole compensation that was paid was “practically” managed and used by Mr. Lee.

[26] Mr. Kim also states that when the compensation was paid, Mr. Lee’s wife, Park Sung-ja, gave him KRW 120 million to hold until she asked for it. He remitted portions of it at her request from Dec. 2001 to August 2004.

[27] The investigation revealed that of the KRW 1,889,661,76 compensation deposited in the bank account set up for the fraudulent payment to Mr, Kim, KRW 60 million was withdrawn and deposited into Mr. Kim’s personal account.

[28] Mr. O states that in May 2001, Mr. Lee prepared the necessary documents and Mr. O filled in the application for compensation and gave it to Mr. Lee. Mr. O further states that when the fraudulently obtained compensation funds were deposited by the government, he withdrew KRW 895 million by way of cashier’s cheques and gave them to Mr. Lee, together with the bank book and seal, less KRW 50 million which he kept for himself. (For reasons I state below, I understand this to be a typographical error, the correct number being KRW 150 million.) He then transferred the balance of the proceeds into another bank account he had opened the same day. The bank book and seal for that account were also given to Mr. Lee.

[29] Mr. Lee’s father states that when the compensation funds were paid to Mr. O, Mr. Lee gave his father a cashier’s cheque for KRW 1 billion out of those proceeds for his use.

[30] Park Jong-sil has passed away since making the statements that are contained in the Record of the Case. However, it is certified that his evidence is available for trial under Korean law. Mr. Lee acknowledges that it properly forms part of the case against him.

[31] Mr. Park’s evidence is that he received fraudulently obtained compensation, applied for by Mr. Lee’s father. The father stated that he acquired the land in Mr. Park’s name on the recommendation of Mr. Lee. Mr. Park’s evidence is that the bank account into which the proceeds were paid was managed by Mr. Lee until he moved to Canada when Mr. Lee’s father took over.

[32] The evidence I have cited is a portion of what is relied on in the Record of the Case to support committal. However, it is a sufficient, as I have said, to meet the requirement of “the existence of any evidence upon which a reasonable jury properly instructed could return a verdict of guilt on the offences of fraud and conspiracy to commit fraud.”

[33] Mr. Lee takes the position that the entirety of the Record of the Case must be considered manifestly unreliable because of the Republic of Korea’s course of conduct in the preparation of the summary of evidence shows a lack of diligence and care and because there is the likelihood that the South Korean government is deliberately misleading this court. As a result, in spite of my finding that there is sufficient available and reliable evidence on which to base a committal, it is necessary to examine the contents of the Record of the Case in greater detail.

(ii) inconsistencies in the evidence

[34] Mr. Lee points to inconsistencies between the : ”will says” of the witnesses and the contents of the annexes and submits that they demonstrate that the contents of the Record of the Case are manifestly unreliable.

[35] He gives as an example the will say of Park Jong-sik in which he states that Mr. Lee “managed” the bank account into which the compensation funds fraudulently obtained using Park Jong-sik’s name were paid. This is contradicted by a statement in the annex entitled “Result of tracing bank accounts for compensation of restitution” that a specified bank account was managed by the respondent’s father. However, the statement in the annex is not Mr. Park’s, but rather that of an investigator and it appears from the charts in the annex that Mr. Park had more than one bank account through which money flowed. This example does not support Mr. Lee’s position.

[36] Also with respect to the evidence of Mr. Park, Mr. Lee submits that his evidence contradicts the evidence of Mr. Lee’s father that he did not apply for compensation for Mr. Park. The evidence shows that more than one application was made in Mr. Park’s name, which could explain what may appear to be a contradiction. However, to engage in this analysis would be to engage in a weighing of the evidence that is being the scope of this hearing. This, like so many of Mr. Lee’s attacks on the evidence, goes to the strength of the case against him and not to whether it satisfies the requirements for committal.

[37] Mr. Lee points to the statement in the summary of the evidence that both the respondent and his father forged documents and argues that this is unsupported by and inconsistent with the evidence in the annex at page 171 that refers only to the respondent’s father as forging documents in the land fraud scheme. However, as I read these documents, the statement in the annex refers to the events prior to 1994, whereas the summary of evidence refers to the events giving rise to the current charges.

[38] Mr. Lee is correct in that there is an inconsistency in the evidence of Mr. O. He refers at one point to having received KWR 50 million, whereas in the summary of the evidence, elsewhere in his “will say” and in the annexes, the amount is stated to be KRW 150 million. The most likely explanation, in my view, is that the smaller number is a typographical error.

[39] It must be noted that the Investigative Audit report in which Mr. Lee notes inconsistencies with the “will says” is not a final document. It was referred to the Gwangju District Public Prosecutor’s Office for confirmation and review. The “will says” were obtained after completion of that process. It is therefore not clear from the record, as Mr. Lee submits, that there are inconsistencies in the evidence that the Republic of Korea has certified to be reliable and available. What Mr. Lee identifies may be the product of changing evidence with the continuation of the investigations. It is not proof that the Record of the Case is manifestly unreliable.

[40] The inconsistencies on which Mr. Lee relies are relevant to the strength of the case against him. That is a matter for trial, not the extradition hearing. The inconsistencies do not rise to the level of rebutting the presumption of reliability of the evidence.

(iii) translation inconsistencies and errors

[41] As a result of scheduling requirements, this application was heard over a period of several months. On the first day of the hearing, I allowed the respondent to call evidence for the purpose of establishing that the English version of the Record of the Case is not the same as the Korean.

[42] Based on this evidence, the English version of annex 9 which purports to include a statement by Mr. Lee, in which he is said to have admitted to various inculpatory facts when questioned by the Prosecutor’s Office, did not reflect what was contained in the Korean version of that document. The critical difference was that Mr. Lee is not referred to in the Korean version; only his father’s name is found in that version.

[43] Prior to the resumption of the hearing, the applicant filed a supplementary Record of the Case on behalf of the Republic of Korea, in response to this evidence. This supplementary Record of the Case acknowledges and corrects the error in Annex 9.[^1] It states that Mr. Lee’s name appears by error in the English version and that the admissions are of his father, Lee Suk-ho.

[44] Mr. Lee also filed additional evidence prior to the resumption of the hearing. It consists of the affidavit of another interpreter contrasting the English translation contained in the Record of the Case with what she states to be the correct translation. The result is that there are now three competing versions of the English translation of the original Korean: that contained in the Record of the Case, a version relied on by the respondent at the first attendance before me but no longer relied on by him, and the version contained in the recently filed affidavit.

[45] Based on the affidavit filed by Mr. Lee, there are errors in translation that go to the heart of the case against him. The summary portion of the Record of the Case twice uses the word “admitted”, where the translation of the original Korean word put forward by Mr. Lee is “assumed” and “presumed”. It appears from the context of the sentences in which the word “admitted” is used that this is not an accurate use of that word. In each case, the basis set out for the conclusion that something has been admitted does not afford such a conclusion. But, the Record of the Case is not dependent on there having been admissions for there to be sufficient evidence to warrant committal and this inaccuracy does not render the evidence in the Record of the Case so unreliable as to make it dangerous or unsafe to commit on the basis of its contents. Nor does the mistranslation of the original Korean support the conclusion that there has been a complete lack of diligence or intent to mislead on the part of the Republic of Korea. The original is correct; read in context, it is apparent that the use of the word “admitted” in the English translation that it does not reflect the intended meaning.

[46] Mr. Lee relies on the fact that his father, in his “will say”, uses the words “which means that” when the proper translation of the original is “may” or “I think”. Mr. Lee submits that this is further proof not only that what is put forward as being the evidence of Mr. Lee’s father is unreliable but that the Republic of Korea is deliberately attempting to deceive this court. However, even if Mr. Lee is correct as to the proper translation, it would not have the effect for which he argues.

[47] With respect to his first point, I have not relied on the portion of the “will say” in which this inconsistency is found in concluding that evidence exists upon which a reasonable jury properly instructed could convict. With respect to the broader significance of this inconsistency, it goes only to the existence of a possible defence. It does not establish that the Republic of Korea has deliberately attempted to mislead this court or that the evidence is manifestly unreliable. (see: Slovenia v. Soba, at para. 33, relying on U.S.A. v. Anderson).

[48] I note that the inconsistencies relied on have not been shown to relate to evidence that is necessary to establish the essential elements of the Canadian parallel offences to those with which Mr. Lee is charged. At least one of the translation errors on which Mr. Lee relies is with respect to the transactions that gave rise to Mr. Lee’s and his father’s convictions in the mid 1990’s and not to the transactions that are the basis of the current charges against them. Not only do the issues with respect to translation not support the assertion that they are deliberate and intended to mislead but, as I have said, there is sufficient evidence without reliance on impugned portions of the translations, to support committal.

[49] No one reading this Record of the Case would dispute that the English translation of the original Korean is grammatically and stylistically poor, confusing and, in some places, almost impenetrable. But, although it would have been far better to have had a more skilled translation, the inadequacies of this translation do not compel me to conclude that they are a product of anything other than the limitations of the translator. I do not accept that the English version of the original Korean reflects a deliberate attempt by the Republic of Korea to mislead this court.

(iv) the adequacy of the evidence

[50] Mr. Lee submits that the allegations against him in the Record of the Case are based on mere speculation as they rely on assumptions and conjecture. He points, as an example, to the fact that the word “assumed” is used throughout the bank transaction analysis contained in the annexes and argues that assumptions fall short of evidence. Another example, he submits, is the use of the word “seems” in the “will say” of Kim Joong-ho.

[51] It would be inconsistent with the purpose and nature of an extradition hearing for me to analyse the Record of the Case as Mr. Lee submits I ought to. As stated in Ferras, at para. 20, the evidence must be approached in a flexible, non-technical manner. That means adopting a common sense approach in analysing the meaning of the words and not putting too fine an emphasis on the nuances of individual words. This is consistent with the reality of, as Mr. Lee’s witness testified, translation being an art. Wording must therefore be considered in context.

[52] Mr. Lee submits that, based on the use of the word “assumed” the investigator’s analysis and interpretation of the documents that he reviewed are mere assumptions. Applying a common sense approach to the wording, the analysis is better described as a conclusion than an assumption. In any event, this “assumption” was subsequently reviewed and confirmed by the Prosecutor’s Office making it irrelevant whether the investigator’s evidence was an assumption or a conclusion. The weight to be given to this evidence is something to be determined at trial.

[53] Similarly, the use of the word “seems” on which Mr. Lee relies, does not undermine the evidence as being mere speculation. Although the summary of the evidence states that Mr. Kim will say that “it seems that Lee Pyong-sik managed the account and used the money”, at a later point in his will say, Mr. Kim states “the whole compensation remitted was practically managed and used by Lee Pyong-sik.” This is an unequivocal statement demonstrating that the word ‘seem’ used earlier in the will say was a poor choice and should not be taken literally.

[54] Mr. Lee submits that as most of the proceeds of the fraudulent compensation payments went into accounts other than his, the evidence of his connection to the proceeds of the fraudulently obtained compensation funds is mere speculation. However, the evidence of the respondent’s involvement in the obtaining of the compensation payments and his control of those proceeds makes the conclusion that the payments to various family members by individuals to whom fraudulent compensation payments were made were made on the direction of the respondent more than mere speculation. It is an inference available on the evidence. The strength of that inference is a matter to be determined at trial. But, in any event, it is not necessary for that inference to be drawn in order for the applicant to be entitled to the committal order sought.

[55] This is not a case such as U.S.A. v. Huynh (2005), 2005 CanLII 34563 (ON CA), 200 C.C.C. (3d) 305 (Ont.C.A.), on which Mr. Lee relies, and in which the court of appeal allowed an appeal from an order of acquittal. In that case, the respondent’s extradition was sought for the Canadian offences of conspiracy to launder proceeds of crime obtained by trafficking in a controlled substance and attempted conspiracy with respect to the same offence. The court held that there was no evidence whatsoever to connect cash in the possession of the respondent with its being the proceeds of drug trafficking as opposed to some other illicit activity. The necessary inference that the illicit activity was trafficking could only be drawn with on the basis of evidence bridging the gap between the proceeds being from illicit activity and the illicit activity of trafficking.

[56] In this case, in the first place, it is not necessary for there to be evidence of Mr. Lee receiving the proceeds of the fraudulently obtained compensation funds. An accused need not have profited by his fraud for him to be found guilty. (R. v. Theroux, 1993 CanLII 134 (SCC), [1993] 2 S.C.R. 5, at para. 19.) But, beyond that, as I have said, there is evidence bridging the gap between the payments made by the South Korean government and Mr. Lee.

(v) availability of evidence

[57] Mr. Lee acknowledges, as I have said, that evidence of the deceased witness, having been certified as available pursuant to Korean criminal procedure must be accepted as such. But, he submits that as his brother-in-law, Mr. Park, on whose evidence the applicant relies, now lives in Canada, there is an obligation on the part of the Republic of Korea to confirm Mr. Park’s availability for trial. Further, he submits that the failure to do so casts doubt on the credibility of the entire Record of the Case.

[58] The problem with Mr. Lee’s first submission is that the Republic of Korea does not rely on the evidence of Mr. Park. There is no will say from him contained in the Record of the Case. What it does rely on are records with respect to Mr. Park’s bank accounts. These records have been certified as being available for trial.

[59] Clearly, the failure to confirm Mr. Park’s availability for trial casts no shadow over the credibility of the Record of the Case.

(vi) availability of a stay

[60] Although Mr. Lee did not focus his oral submissions on a request for a stay, I will comment on it briefly as it is referred to in his factum.

[61] Mr. Lee has not met the very high threshold of establishing that a stay of proceedings is warranted. As stated in Soba, at para. 17: “A stay for abuse of process is granted only as a last resort” and, quoting from U.S.A. v. Magnifico (2007), 2007 ONCA 535, 223 C.C.C. (3d) 129 (C.A.) at para. 16, “…would only be granted in the clearest of cases, on the basis that the prosecution is “tainted to such a degree that to allow it to proceed would tarnish the integrity of the court”. The concerns regarding this prosecution are not of a nature that would approach what is contemplated for a stay to be justified.

Conclusion

[62] The concerns raised by Mr. Lee with respect to the reliability of the evidence are not, in the words used by the court of appeal in Anderson, at para. 30, “sufficiently powerful to justify the complete rejection of the evidence”. As a result, as the court continued to state, these concerns are not germane to the s. 29(1)(a) inquiry.

[63] I find that there is evidence that Mr. Lee knowingly defrauded the government of the Republic of Korea through the submission of fraudulent applications, of funds paid by the government pursuant to its land compensation program, sufficient to meet the test for committal. Further, I find that there is evidence that there was a common agreement between Mr. Lee and persons in whose names applications were submitted and with his father to commit the fraud. Accordingly, there is some evidence available for trail on every essential element of the corresponding Canadian offences upon which a jury properly instructed could convict.

[64] The Authority to Proceed is not based on an indictment proffered by Republic of Korea setting out individual counts against Mr. Lee. In oral submissions, Mr. Lee argued that it would be unfair to commit him at large. However, as Dambrot J. stated in United States of America v. Quintin, 73 C.R.R. (3d) 237, at para. 128: This flies in the face of the rules of criminal pleading and misconceives the function of an extradition judge.

[65] It is sufficient for me to commit Mr. Lee on the two all encompassing fraud and conspiracy to defraud charges. It is not necessary that there be evidence to support each instance of fraud and conspiracy to defraud alleged by the Republic of Korea. Nor is it necessary to specify the instances with respect to which there is evidence to support a committal.

[66] For the foregoing reasons, the application for a committal order is granted. I order the committal of Mr. Lee.

Frank J.

Date: February 2, 2012

[^1]: The Supplementary Record of the Case also corrects a date and confirms the availability of the deceased witness’s evidence pursuant to Korean criminal procedure.