HKSAR v. LAU WA SANG AND ANOTHER

CACC203/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO.203 OF 2000

(On Appeal from DCCC No.955 of 1999)

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J U D G M E N T

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Stock JA (delivering the judgment of the Court) :

Background

1. These defendants have been convicted of blackmail by HH Judge Saunders in the District Court and each sentenced to community service of 120 hours. They apply for leave to appeal against conviction.

2. The defendants were charged with robbery arising out of an incident on 23 March 1999 at No.27 Wellington Street, Central. That address is the office of a company called Kwong Fat Cheung Ivory and Mahjong Factory Limited ("the Company"). One of the owners of the Company is a man called Norman Huen Wing Kwan ("Norman Huen"). The 1st defendant is also an ivory dealer. Norman Huen and the 1st defendant had dealings in ivory - they were personal dealings in the sense that such agreements between them with which we are concerned were between them and not between the 1st defendant and the Company.

3. Norman Huen had agreed to sell a particular quantity of ivory to the 1st defendant, but was unable to deliver it. A deposit had been paid by the 1st defendant for the ivory so that that deposit was due to be repaid. Apart from the deposit, Norman Huen was further indebted to the 1st defendant. The exact nature of the indebtedness was in dispute; the 1st defendant suggesting that he had lent sums to Norman Huen, and Norman Huen suggesting that it was in respect of payments already made, plus interest, for ivory promised but not delivered. The amount due was $1.8 million. In October 1998, Norman Huen issued a postdated cheque which bounced; and he issued two further cheques in February 1999 with the same result. In February 1999, Norman Huen delivered to the 1st defendant a quantity of ivory in part payment of, or as security for, the sums thus due, the judge finding as a fact that both parties regarded the delivery of that ivory as a form of pledge whereby the ivory would be returned when cash in settlement of the debt was paid to the 1st defendant. By late March 1999, there was, however, still outstanding - and this does not appear to be denied - from Norman Huen to the 1st defendant this sum of $1.8 million. The 1st defendant had pressed for payment but without success. There was some suggestion by him that he had told Norman Huen on 20 March that he was fed up, and that Norman Huen told him to go to the Company and there see his eldest brother. Norman Huen denied that this was ever said. In any event, it is clear that by end March, the 1st defendant was indeed at the end of his tether, and that he visited the premises of the Company on 23 March 1999, and it is there that there took place the events which are at the core of the charge and of the conviction against which this application is launched.

4. The judge found that at about 12.30 pm on 23 March 1999, the 1st defendant, the 2nd defendant and two other men went to the Company's premises with a goods vehicle. Once inside, they required Mr Huen Wing-tim, who is one of the brothers of Norman Huen, as well as members of staff and a visitor to the premises, to go up to the mezzanine floor above the storeroom. This was the workshop or warehouse. One of the men picked up a file - normally used to work ivory - and pointed it at a staff member. Huen Wing-tim was told that if he did not move, he would be alright. A female member of staff was pushed into the workshop and was told to make no noise, and foul language was used. The daughter of one of the Company directors was similarly pushed and told not to move and not to look. The ivory carver saw one of the men pick up this file and it frightened him, and he was told to go to the mezzanine floor and not to make any noise. A visitor to the premises was told not to make a noise, not to turn round and to mind his own business. What then happened was that a large quantity of ivory was removed from the premises and taken to the vehicle and driven away. As the men left the premises, they told those who had been threatened not to report the matter to the police.

5. The basis for the robbery charge was thus evident : that the men, who included the 1st and 2nd defendants, had stolen the ivory and had used force and threats to do so.

Evidence

6. The 1st defendant gave evidence for the defence, and the defence revealed by that evidence was that he saw nothing untoward going on and that in any event he had not acted dishonestly. It was common ground that before going to the premises, the 1st defendant had prepared a receipt which was to evidence the number of tusks taken, with the number to be filled in at the Company premises. The receipt reads as follows :-

"Received from Kwong Fat Cheung Ivory and Mahjong Factory Limited a batch of ivory materials, 35 pieces, at a pledge of a sum owed by shareholder Huen Wing-kwan. Repayment has to be made within five days before deadline, otherwise the batch of goods will be treated as compensation. Goods received by Lau Wa-sang, 23 March 1999, Room 1611 Pacific, Kowloon Bay."

In his evidence, the 1st defendant said that he had lent Norman Huen most of the monies due. He became concerned when repayment was not made, and was led to believe that the Company would make good any losses. His evidence was that in February, after the delivery of some ivory, and after the cheques had bounced, and when monies were still not repaid, he telephoned one of the Huen brothers at the Company and was told that if there was such a debt, the Company would take responsibility for it. One notes that this suggestion was denied by Huen Wing-tim whose evidence it was that these loans had nothing to do with the Company and that no such undertakings were given. Eventually, when it became clear that Norman Huen was not going to pay, the 1st defendant decided to go to the Company to get some material. His evidence was that the reason he took two other men was that they were mere workers to move the ivory because it was very heavy. He stated in his evidence that the ivory was taken with the agreement of one of the brothers there, Mr Huen Wing-yue, the oldest of the brothers, described by one of the witnesses as the boss of the Company, and that his discussion with Huen Wing-yue was normal. He said that when he was talking to him, it was by his desk in the shop; the others at that stage were standing in the open area of the shop. He said that he told Huen Wing-yue that Norman Huen had mentioned to Huen Wing-tim that he ("the 1st defendant") would be coming to take the ivory :

"500 to 600 kilogrammes of it will be taken ... If repayment can be made now, we will not take it."

According to this evidence, the tone of the conversation was normal, and the two of them sat at the desk and talked about Norman Huen while the ivory was being collected. The defence, in other words, was that there was a discussion and that it was agreed that on account of the debt long overdue, this ivory was to be taken by the 1st defendant. If that were true, no offence was committed. As for violence or forcing people to go to the warehouse, the 1st defendant said that he heard and saw no such thing. Before going to the Company's premises, there had been no discussions suggesting force or threats, and he was quite sure that whatever response there was to be when they went to take the ivory, there was no question of taking the ivory by force. He said that he took the ivory as security and hoped that Norman Huen would repay the cash owed; for the alternative was to sell the ivory, and that would prove more difficult.

7. Evidence was given by another defence witness, a Mr Hung, another ivory dealer. He had warned the 1st defendant against lending money to Norman Huen without obtaining some guarantee from the Company. He said that, on the 1st defendant's behalf, he had spoken to Huen Wing-yue in about February 1999 about the bounced cheques and that Huen Wing-yue had confirmed that the Company would be responsible for the debt. There was a third defence witness who gave evidence about the price of ivory. The 2nd defendant chose not to give evidence.

The judge's findings

8. The judge was satisfied that there was a debt due from Norman Huen to the 1st defendant; that in February 1999, ivory had been delivered to the 1st defendant as security for part of the debt. He thought that the inference could be drawn that the 1st defendant thought that the debt could be satisfied by delivery to him of ivory if the debt was not satisfied in cash; and a further inference could be drawn that the 1st defendant believed that the Company would, if necessary, stand behind Norman Huen's debt. Accordingly, he acquitted the defendants of theft because he was not satisfied that the appropriation of the tusks was dishonest. That being so, theft was not proved and without proof of theft or intended theft, there could be no robbery. No doubt the receipt left behind by the defendant added to the judge's conclusion that he could not be satisfied as to the elements of dishonesty, as did the fact that the 1st defendant did not, on this visit to the Company premises, try to hide his identity.

9. Section 32(1) of the Theft Ordinance provides as follows :

"(1) If on the trial of any information, charge or indictment for an offence specified in the first column of the Schedule it is proved that the accused is not guilty of that offence but guilty of one of the offences specified opposite thereto in the second column of that Schedule or of attempting or being a party to an offence so specified, the accused shall be acquitted of the offence originally charged and shall be convicted of such other offence or of attempting or being a party to such other offence and be liable to be punished accordingly."

By virtue of paragraph 2 of the Schedule, blackmail is such an alternative to robbery. Blackmail is defined by section 23(1) of the Theft Ordinance as follows :

"(1) A person commits blackmail if, with a view to gain for himself or another or with intent to cause loss to another, he makes any unwarranted demand with menaces; and for this purpose a demand with menaces is unwarranted unless the person making it does so in the belief -

(a) that he has reasonable grounds for making the demand; and

(b) that the use of the menaces is a proper means of reinforcing the demand."

10. The judge was satisfied that the conduct of the defendants, acting their respective parts in the joint enterprise at those premises, constituted an unwarranted demand with menaces for gain and that the defendants could not have believed that the use of such menaces as were deployed could constitute a proper means of reinforcing the demand.

11. The judge does not state in terms what the demand was, and that is a matter to which we shall return. But he held that there was a demand and that the demand was accompanied by menaces. The menaces were represented by the pushing of persons, shepherding them out of the way, the wielding of the file, and the use of language in terms such as to put persons there in fear, all of which was so that they would accede unwillingly to the removal of the ivory. He was satisfied that neither of the defendants could have believed that the use of those methods was a proper means of enforcing the demand. He further found that the 1st defendant, whatever precisely he saw or did not see of the behaviour of his cohorts or colleagues in the Company premises after his arrival, knew full well that the ivory was going to be taken by force and in the atmosphere of threat which was created. The 2nd defendant, he found, took a full part in ordering or assisting the men who had come along to help to do what it was they were to do. Accordingly, the judge convicted each defendant of blackmail. It is against this conviction that they seek leave to appeal.

The character issue

12. The first ground of this application is that the judge failed to give himself a Vye or Berrada direction; in other words, a direction as to the defendants' good character. It is said that this was particularly important, given that the judge disbelieved the 1st defendant's assertion that the ivory would not be removed by force, and given the judge's conclusion that the defendants must have appreciated that the method used to secure the delivery of the tusks was not a proper means of enforcing the demand made. The 2nd defendant did not give evidence, but even so, Mr Poon, who appears before us on the defendants' behalf, says that there should in his case had been a propensity direction.

13. It is a fact that the judge has not stated in his Reasons for Verdict that he took into account the previous good character of the defendants. Mr Poon, on behalf of the defendants, has in his skeleton submissions cited the case of R. v. Chan Wu Nam, Crim.App. No.274 of 1992, suggesting that it highlights the importance, whenever credibility is in issue, of articulation by a judge that he has taken into account good character. But it has been made quite clear that that case is not :

"... authority for the proposition that in all cases where credibility is in issue, the judge must set out the manner in which he has considered the accused's good character in deciding that issue. Where a judge is sitting alone and evidence of good character has been given, this court will, even if he makes no mention of it, unless there be some express or implied indication otherwise, act upon the basis that he was aware of the character evidence and that he gave it the weight which he thought it deserved."

(See R. v. Fok Tin Yau [1995] 2 HKC 450, 456.)

14. There is no indication in this case that the judge did not have good character in mind. This was a closely analyzed and very full judgment in which the judge gives reasons why on one aspect of the case, he is prepared to believe the 1st defendant, and why on another he is not; and his conclusion seems to us to assume much in the 1st defendant's favour, as is evident from his finding as to dishonesty on the robbery charge. This was a balanced judgment in which his conclusions clearly proceeded from an assumption in the defendants' favour that here was a businessman, the 1st defendant, who had had the rough end of prevarication on the part of another man who would not pay his debts; but concluded that in the event the 1st defendant went too far. That approach and that balance is evident from the Reasons for Verdict as a whole.

15. In so far as it is suggested that an express reminder as to character was particularly necessary when there is a question of belief as to the propriety of methods used to enforce a demand, we note that the 1st defendant did not say that he believed the methods used were proper. He said he had no part of those methods, and he no doubt distanced himself from them because it is as obvious as can be that no reasonable person, no matter how clear his previous record, could possibly believe that herding people against their will and abusing them could be a proper method of enforcing a demand. In our judgment, on the facts of this case, and in the light of the reasons as a whole, there is nothing in this ground.

Complicity in blackmail

16. Then it is said that the judge erred when he found that the defendants had engaged in a joint enterprise to demand with menaces. The contention is that the finding was inconsistent with evidence that the men other than the defendants were only workers; that there was no evidence of a demand with menaces levelled against Huen Wing-yue with whom the 1st defendant spoke when he went into the Company premises; that there was no evidence to justify the judge's conclusion that Huen Wing-yue was given no option but to allow the tusks to be taken away; that there was no evidence of a refusal by Huen Wing-yue to hand over the ivory; no evidence to show that either defendant knew that one of the two men with them had picked up a file; and no evidence or insufficient evidence that such demand as may have been made coincided with the menaces which the judge found had been offered.

17. These points hold no water. They simply ignore the reality of the evidence as a whole, and the argument rests on a division of the story into artificial segments. It is the picture as a whole to which the judge rightly had regard, and he addressed that picture realistically.

18. The fact that Huen Wing-yue did not give evidence - apparently he had been hospitalised - is in the circumstances of this case, and in the light of evidence from others at the premises, neither here nor there. The evidence of the 1st defendant himself was that he said to Huen Wing-yue that they would not take the ivory if payments were made then and there. In other words, if payment was not made then and there, the ivory was going to be taken. It must have been obvious, both to that gentleman and to the others in the premises, and as the defendants must have appreciated and intended, that by words and by conduct there was a demand. The demand was for immediate settlement of the debt or for provision of security for the debt. That demand was accompanied by a menace or menaces, the impact of which was that no one at those premises was in a position to refuse even had he or she so wished. The group simply arrived, and they arrived with a lorry and men. The men, once in the premises, immediately went about bullying the occupants of the premises. It is in our view unthinkable that men employed as menial assistants would have engaged in such behaviour without pre-planning on the part of all four and without direction from the 1st defendant. In all those circumstances, there can only be one conclusion to draw, which is that they came to take the ivory or to receive payment whether the Company directors liked it or not.

19. There is some suggestion that there was no evidence of a demand with menaces made to Huen Wing-yue himself. Even if that was so, that matters not. There was clearly an implicit demand made of others, for example, Huen Wing-tim, accompanied by menaces, namely, the demand that they be allowed to take the ivory. One cannot compartmentalise matters in this way. The demand and menaces were levelled globally as it were, and were continuous.

20. It is said in the skeleton that the judge failed to consider the possibility that Huen Wing-yue had an opportunity to refuse to hand over the ivory and that had he permitted the ivory to be taken, it was unlikely that the men with the defendants would have uttered threats to others. If it is suggested by this that Huen Wing-yue brought about the conduct of the men who made threats on his staff, the less said about such a suggestion the better. If it be suggested that it was open to Huen Wing-yue to refuse the demand, the answer is that the behaviour of the party who accompanied the 1st defendant onto the premises took on its nasty air at once, and there was no waiting for a reaction from Huen Wing-yue; and as we have already commented, the demand was a continuing one levelled at all the members of staff.

The 2nd defendant

21. It is contended that there was no finding that the 2nd defendant picked up the file and that there could, therefore, be no finding that he was party to the joint enterprise. The point is, with respect, bad. The judge was satisfied, from the whole of the way in which the visit to the shop and the removal of the ivory was executed, that the removal of the people to the mezzanine floor was pre-arranged. The 2nd defendant was one of the persons who he found required the people to go to that floor. The inference, he said, "is overwhelming that all took place as a result of a pre-arranged scheme". The judge was clearly entitled to take that view. Indeed, it would have been odd had he come to any other conclusion. The suggestion therefore that there was insufficient evidence to render the 2nd defendant a party to the unlawful escapade has no merit at all. Furthermore, in the light of the finding of such a prearranged scheme, and in the light of the findings as to the conduct of the party as it entered the premises, the contention that there was insufficient evidence to show participation by both defendants in the enterprise of making demands with menaces, is similarly without merit.

A view to gain

22. It is then said that there was insufficient evidence upon which to conclude that the demand, such as it was, was made with a view to gain. The basis of the suggestion, somewhat tentatively advanced before us, is that the defendants were only obtaining that which was their due. Whether in fact it was established that there were any sums or property due from the Company is doubtful but, putting that aside, the argument is that where there is a debt due, then there is nothing to be gained by a demand for that which is due, or that the demand could not have been made with a view to such gain. Mr Poon has, for this proposition, referred us to a view expressed in a 1966 article, but the weight of authority and opinion is clearly against the proposition advanced by the defendants.

23. It is to be noted that section 8(2) of the Theft Ordinance defines "gain" as follows :

"... 'gain'（獲益）and 'loss'（損失）are, except in section 16A, to be construed as extending only to gain or loss in money or other property, but as extending to any such gain or loss whether temporary or permanent; and-

(a) 'gain' includes a gain by keeping what one has, as well as a gain by getting what one has not;..."

The editors of Archbold 2000, with whose views we agree, state as follows in paragraph 21-267 :

"Since the definition of 'gain' includes 'getting what one has not', it is submitted that there is no justification for any argument that 'gain' should be limited to 'gain' in the sense of 'profit'. If a person makes a demand for a debt lawfully owed to him, it may be argued that he does not do so with a view to profit, but he certainly does so with a view to getting what he has not. It has been held at first instance that by demanding money lawfully owing to him the defendant did have a view to 'gain': by obtaining hard cash as opposed to a mere right of action in respect of the debt the defendant was getting more than he already had: R. v. Parkes [1973] Crim.L.R.358 ... In R. v. Lawrence and Pomroy, ante, it appears to have been assumed that an unwarranted demand with menaces for a debt believed to be due was blackmail."

The same point is made by Blackstone's Criminal Practice 2000, paragraph B5.85 that it is :

"... certainly possible to commit blackmail by using improper menaces in the course of demanding money or other property to which one is legally entitled (Lawrence (1971) 57 Cr App R 64);..."

Reference is made in Smith & Hogan "Criminal Law", 7th Edition, page 612, and in "Property Offences" by Professor T. Smith of Cambridge University to some alternative arguments (one of which is the 1966 argument to which Mr Poon took us), but Professor Smith concludes, as we think must be the case, that the legislature intended that a defendant can have a view to gain even where he is or believes himself legally entitled to the property demanded. We are satisfied that this ground must fail.

The added ground

24. There has been added, with our leave, a further ground of application for leave to appeal against conviction, but we have discovered that, through no fault of counsel, the ground was based upon an erroneous understanding of fact as to whether the judge gave notice that he was minded to convict of the alternative charge of blackmail. As counsel now accepts, the question was canvassed by the trial judge with counsel, and the new ground, as framed, can provide no viable ground of application for leave to appeal.

Conclusion

25. In this case, it was amply demonstrated that the defendants made the demands we have described, with and backed by the menaces, constituted by the behaviour which the judge found proved. The judge was wholly entitled to take the view that the whole affair was pre-planned and that the defendants were party to that plan and to a joint enterprise to grab these tusks in the wake of the threatening atmosphere they intended to and did create, and that each must have known that the use of such menacing behaviour was not a proper means of reinforcing the demands that were made. As such, those demands were unwarranted. There is nothing of substance in any of the grounds raised. Accordingly, in the case of each defendant, the application for leave to appeal against conviction is dismissed.