THE QUEEN v. KWOK YUEN SUM

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JUDGMENT

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McMullin, V. -P. :

1. On the 15th of August we dismissed the application for leave to appeal against conviction by KWOK Yuen-sum reserving our reasons till later. These we now give.

2. The applicant was formerly employed as a Social Work Assistant in the Social Welfare Department of the Hong Kong Government. He was convicted in the District Court on the 19th of November 1984 upon 22 charges of obtaining property by deception contrary to the provisions of Section 17(1) of the Theft Ordinance Cap. 210 and upon 3 charges of attempting to commit the same offence.

3. It is unnecessary to enter into the details of the prolonged and extremely successful imposture practised by the applicant whereby, between January 1980 and May 1984, he prevailed upon six Young women to part with sums of money totalling about $125,000 by way of loans.

4. The essential features of this remarkable deception areas follows. In a series of telephone calls, commencing at the beginning of 1980, he presented himself to these women, each of whom was unknown to the others, as a doctor carrying out a sex survey for the Medical and Health Department. In each case he succeeded by this means in inveigling himself into the confidence and then into the affections of each of these women some of whom were married and all of whom were in some measure unhappy or dissatisfied with the state of relations between them and either husbands, boy friends or members of their families. In all cases, save one, these women eventually granted him sexual favours and all in some measure regarded him as a well trusted lover.

5. Over this period he borrowed from the six complainant witnesses (who, it seems, only became complainants when, in the course of investigations into the applicant's personal affairs by officers of the Independent Commission Against Corruption, this extraordinary story came to light), the various sums of money stated in the charges upon the several pretexts stated in the particulars of these charges.

6. In a judgment which in most respects, is a model for clarity and concision in a case of this kind, the District Judge having succinctly summarized the unusual background to these borrowings, points out that the case is not concerned with the obtaining of sexual favours by deception but solely with the obtaining of property by that means.

7. He found that the evidence had established that throughout the period covered by the many charges, four distinct representations had been resorted to by the applicant in seeking financial assistance from his willing dupes. One of these, however, concerns the alleged borrowing of $6,000 for the purpose of paying tax (the 26th charge) and the judge found that the evidence was insufficient to sustain that charge. He held that the Crown had proved to his satisfaction that the applicant had repeatedly, variously, and successfully resorted to the other three representations which were: 1), that the money was needed to pay the applicant's expenses in relation to medical studies and examinations to be undertaken by him both in Hong Kong and abroad in furtherance of his alleged medical career; 2), that it was needed to defray hospital expenses in the treatment of his nephew or his sister; 3), that it was needed to purchase property in real estate or shares.

8. The judge identified the issues to which he needed to address himself as follows

"In order to substantiate charges of that nature the prosecution have to prove at least 5 things (1) The actual deception which includes proof of the nature of the deception and the fact that it was false. (2) That the property passed to the accused or another as a result of the deception, whether or not it was the sole or main inducement. (3) Dishonesty on the part of the accused. (4) That the deception operated on the mind of the victim and was a cause of the payment, and (5) An intention to permanently deprive."

9. It was not contended before this Court that these representations were not made as stated in the charges or that the evidence did not support the particulars in each case. It may be said also that insofar as the second and fourth of those issues are concerned no question is now made as to the propriety of the the judge's findings save with regard to the last three charges (28th, 29th and 30th) upon which the applicant was convicted of the attempt to obtain by deception. That was because the trial judge was not satisfied that the evidence of the complainant under those charges showed that she had in fact been deceived by the representations made to her upon each of those occasions.

10. In respect of all the remaining charges on which the applicant was convicted the judge found - and counsel does not seek to controvert these findings - a) that the sums charged did pass in each case from the named complainant upon the stated representation and that, b), in every case save that of the complainant on charges 28, 29 and 30 the reason for advancing the money was, at the very least in part, due to the representation being accepted by the particular complainant as the truth.

11. On the first issue the judge found that each of these three representations was false when made. He relied upon certain answers given by the applicant, in the course of the investigation, to officers of the Independent Commission. The substance of these answers is that the applicant a) had never undertaken any medical studies anywhere; b) has no sister or nephew; and c) had never invested in real property or shares. The applicant did not give evidence but in one of the three statements made by him to the Independent Commission he admitted that so far from using any of these loans for the stated purposes he had, apart from a certain sum which he claimed to have used for medical and funeral expenses of his mother, spent it all in gambling upon horses.

12. Of the many grounds of appeal urged on behalf of the applicant only one calls for consideration:

The Question of Honesty

13. We are left with the only ground which is colourable of substance.  Although somewhat elaborately stated it raises in a fact a single point which touches the two remaining and closely linked issues identified by the trial judge viz. : a) whether the applicant in soliciting these loans upon these false representations was acting honestyly; and b), whether he. intended permanently to deprive the women of their property.

14. The leading authority on what constitutes dishonesty, whether in theft or in obtaining by deception, is the decision of the English Court of Appeal in the case of Deb Baran Ghosh ⁽¹⁾.  It seems remarkable that this case was never drawn to the attention of the trial judge.

15. It may be, as some of the leading academic writers have complained, that the decision in Ghosh has not rendered the task of judges or juries any easier, or the law itself less complicated. Indeed it is of interest that the learned Lord Chief Justice, delivering the judgment of the Court, expressly notes the complicated character of the law as it then stood and goes on to profess that the court over which he was then presiding was approaching its task with "great diffidence?"

16. It is nevertheless clear that the law as it stands in England presently obliges a Judge to direct any jury dealing with charges of this description to consider two questions: 1) was the defendant's conduct dishonest by the standards of reasonable and honest people; and 2) did the defendant realise that it was dishonest by those standards. If either of these questions is answered in the negative an acquittal must follow.

17. This would seem in essence to be a harnessing of the subjective and objective standards as these had formerly been perceived as providing the relevant test of honesty in cases such as Reg. v. Landy ⁽²⁾ (the subjective approach) and Reg. v. Greenstein ⁽³⁾ (the objective approach).

18. It is said in the present case that the judge erred in applying a solely objective test to the question of the applicant's intention when, as he did, he referred in various ways to the unlikelihood of the applicant's entertaining a reasonable hope of being able to repay describing it in one place as a mere "pious hope".

19. For a start, this is to some extent a misrepresentation of the judge's actual findings. When he was dealing specifically with the issue of dishonesty he concentrated wholly on the fact of the deception, rightly finding that the applicant had no belief in the truth of his representations at the time when he made them. That this does constitute dishonesty within Section 17 is borne out by what is said by Lord Lane in Ghosh at page 159. Dealing with Section 15 of the Theft Act of 1968, which is in terms identical with our Section 17, he says:

"The difficulty in Section 15 of the Theft Act 1968 is that dishonesty comes in twice. If a person knows that he is not telling the truth he is guilty of dishonesty.  Indeed deliberate deception is one of the two most obvious forms of dishonesty.  One wonders therefore whether 'dishonesty' in Section 15(1) adds anything except in the case of reckless deception."

Again, in Professor Smith's treatise on the Law of Theft (Fifth Eddition) at page 96 - para. 186 - relying upon Greenstein is of the opinion that the deception itself may be evidence of dishonesty.

20. It is true that the doubt expressed by the learned Lord Chief Justice in Ghosh as to the possible redundancy of the term "dishonesty" in Section 15 was not further pursued by him in that case and has not, sofaras we are aware, been resolved by any high authority elsewhere.

21. It remains true that the deception and the intent to repay appear as distinct elements both in the Hong Kong and the English legislation and it would seem therefore that since in Ghosh the mere proof of deliberate deception will not of itself in every case disable a defence based upon intention to repay.

22. Counsel for the applicant is therefore on good ground when he points out that the trial judge's reliance upon the Court of Appeal decision in McCall ⁽⁴⁾ - itself looking back to the much older authority of Carpenter ⁽⁵⁾, was misplaced. The law there stated is to the effect that intent to repay even if based upon an honest belief in capacity to repay, and even if there is good reason to believe in that capacity, is no defence to a charge of obtaining a loan by deception. After quoting from these sources, the trial judge went on to say:

"He had at best a pious hope of repaying the money at some uncertain future date and that provides no defence to these charges on the authorities I have mentioned."

In so expressing himself he would have been wrong if he was intending to say that all question of intention to repay was irrelevant. Prior to this somewhat unfortunate quotation, however, the judge had already addressed himself to what is in fact the true test under Ghosh. At page 9 of his reasons he says:

"I think the most one can say is that whilst the accused may have had some vague hope of repaying the loans, because of the number and volume of the loans be obtained he must have known and realised he had no chance of ever doing so. He could therefore have had no reasonable intention of repaying them."

23. Even if, since Ghosh, the deception, the intent permanently to deprive and dishonesty are distinct and separate elements each of which must be proved by the prosecution as an essential particular in bringing home the charge, the element of dishonesty is clearly a fundamental consideration both in respect of the false representation and any alleged intent to repay. In other words the alleged intent to repay must itself be honest. If must be entertained as an honest belief. While the judge like a jury, will have to concern himself with the question: "Did the defendant have an honest intention to repay?" He cannot answer that question without looking at the circumstances at large to test the honesty of the belief.

24. In the present case the judge found that the applicant had "no reasonable intention of repaying" these women. We cannot regard the use of "reasonably" in that phrase as providing anything more than a yardstick whereby the judge was measuring the actual intention of the applicant. Thus measured he was driven to the conclusion that the applicant must have known and realised that he had no chance or ever repaying these loans. In other words, he was not merely saying that there were no reasonable grounds to support the contention of an intent to repay but that, once the applicant realised that he had no chance of repaying, any professed intent to repay could not but be dishonest.

25. The references to "reasonable intention", "vague hope" and "pious hope" must, we think, be understood merely as ways of testing the honesty of any possible intention to repay. If he had no honest intention of repaying then it could not be contended on his behalf that he might have thought that what he was doing was in accord with the standards of honest and reasonable people.

26. Nothing said by the judge in the instant case is equivalent to the direction given by the judge to the jury in Reg. v. Waterfall ⁽⁶⁾ where the jury were positively instructed that their task was to decide whether there was any reasonable ground for the defendant thinking that he would be able to pay for the taxi ride which he had undertaken without any money sufficient for that purpose, a direction which caused the Court of Appeal to quash the conviction.

27. Whether aware of the decision in Ghosh or not it would appear therefore that the judge in the present case correctly addressed himself to the questions which, under that authority, are relevant in considering the alleged dishonesty of the defendant's intention.

28. It is true that over this long period the applicant did succeed in repaying some $59,000. It is this which is urged - the applicant not having given evidence - in support of the contention that the Crown did not prove that the applicant had neither the capacity nor the intention of repaying these loans in full. Counsel has argued that an intent to repay these loans cannot, at least at the earliest stages, be regarded as unrealistic and that therefore the applicant cannot be said to have been dishonest in accepting these earlier loans; and as for the later, they were without term and might therefore ultimately be paid.

29. That might have been an argument of some substance if the solicitations themselves had been honest in the sense that they were based upon true representations by the applicant of his status and intentions. But as Mr. McNamara, for the Crown, put it, it would be wholly unrealistic in a case of this kind to consider the element of deception and the element of intent permanently to deprive and the alleged intent to repay as wholly distinct from each other in determining the question of honesty or dishonesty.

30. For this reason also we found no substance in counsel's suggestion that the judge had erred in taking what counsel termed a "global view" of these borrowings in determining the question of dishoensty. It is quite true that the intention of the applicant which needed to be determined was his intention at the time when each particular loan was made but it is quite wrong to suggest that in determining the intention on each such occasion the judge was not entitled to have regard to the whole course of the applicant's conduct.

31. Here the judge was confronted with a situation in which, at the time of his arrest, the applicant had succeeded in returning less than half of the money covered by the charges. $54,000 out of the $59,000 thus returned were repayments made at a very late stage between the end of 1983 and his arrest in 1984 and these were repayments to two out of the six complainants. That whole course of conduct was relevant in determining the state of the applicant's intention at any stage throughout the entire period.

32. The honesty or dishonesty of the applicant's intentions on all these occasions has, in addition to be considered in relation to his frank admission to an officer of the Independent Commission that he had done wrong and that he felt himself to be in need of psychiatric treatment.

33. Insofar as the trial judge may have misinterpreted the current state of the law in referring to McCall and Carpenter, we were satisfied that he had in fact applied the proper test and that, if necessary in respect of any such misdirection, the proviso could be applied.

(1)    (1982) 75 Cr App. Rep. 154

(2)    (1980) 1 W.L.R. 355

(3)    (1975) 1 W.L.R. 1353

(4)    (1970) 55 Cr. App. Rep. 175

(5)    (1911) 22 Cox. 618

(6)    (1970) 1 Q.B. 148