THE QUEEN v. H.G. DETTENTHALER

HEADNOTE

Import and Export Ordinance, Cap. 60, s.36(1)(a) – Making a false statement.

Documents received by witness in the ordinary course of business and produced by him from his custody as part of business record – Admissibility – Whether facts stated in the documents become evidence as result of cross-examination on the contents by opposing party.

IN THE SUPREME COURT OF HONG KONG

(Appellate Jurisdiction)

MAGISTRACY CRIMINAL APPEAL No. 599 of 1987

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JUDGMENT

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1. I dismissed this appeal on 25th August, 1987 and indicated that I would give reasons. This I do now.

2. The appellant, who at the material time was and I believe still is the general manager of Quelle (Far East) Company, was found guilty after trial by a magistrate of the offence of making a statement in an application for the issue of an export licence which was false in a material particular contrary to section 36(1)(a) of the Import and Export Ordinance, Cap. 60. He was fined $18,000. He appeals against conviction.

3. Export of textile products to certain countries, and in this case Austria, is regulated by a quota system under a scheme administered by the Department of Trade of the Hong Kong Government. For the purpose of this judgment, it is not necessary for me to go into the complicated procedure governing the application for, allocation, transfer and cancellation of quotas, suffices to say that a holder of quotas may have its quota for the ensuing year cancelled, reduced, increased or maintained at the same level depending, inter alia, on the utilisation of the quota it holds for the current year. Quelle (Far East) Company, which I shall refer to simply as Quelle for the sake of convenience, is a holder of quotas for export of textile goods to Austria.

4. The facts were that on or about 21st October, 1985 the Department of Trade received an application for an export licence known as Export Licence (Textiles) Form 5, which was submitted on behalf of Quelle as the exporter for the export of 1,010 pieces of ladies 100% cotton woven trousers to Austria. The exporter's declaration at the right hand bottom corner was made by one H.G. Dettenhaler with an illegible signature and it was dated 17th October, 1985. The declaration was to the effect that the particulars were true and that he was supplying the quota for the goods in accordance with condition (3) overleaf which specifies that the company supplying the quotas for the goods covered by this licence must:

either (1): perform at least four of the following fuctions:

(a) receive order from the overseas buyer,

(b) receive payment from the overseas buyer,

(c) purchase or supply the raw materials for the manufacture of the goods,

(d) contract with the manufacturer for the manufacture of the goods,

(e) make payment to the manufacturer of the goods, and

(f) arrange the export of the goods,

or (ii): perform the terminal processes in the manufacture of the consignment in question.

The manufacturer named in the application was Easze Garment Factory and condition 3(ii) was therefore not applicable. It was the case of the prosecution that three of the six functions were not performed by Quelle.

5. Two officers from the Department of Trade visited Quelle on 1st August, 1986 and saw the appellant who was shown the application and admitted that he was the person who signed the exporter's declaration. He was immediately cautioned by one of the officers and in reply he said that he did not wish to make a statement at that time but he would write to the officer in about a fortnight's time after he had checked with the company staff and record. He did and a letter dated 20th August signed by the appellant was subsequently delivered to the officer, Mr. Y.M. Wong. In that letter it was stated that the contract for the goods in question was placed by an Austrian buyer with Hansa Trading Company but Hansa, due to the tense quota attention, was unable to ship the goods under their quota and Quelle was helping Hensa out with Quelle's quota. The letter was undoubtedly a full admission of guilt.

6. The proprietor of Easze Garment Factory gave evidence that he entered into a contract with Hansa Trading Company for the manufacture of the ladies cotton woven trousers. He was paid by Hansa and the trousers were made from materials which he bought from Ho Cheong Textiles Limited and he also paid that company for the materials.

7. The appellant did not give evidence.

8. Counsel for the appellant, who appeared here and below, raised a number of objections which were, in my view, ill-conceived and without proper legal foundation. These are just a few examples. Firstly, he objected before the learned magistrate and compained before me that the admission by the appellant to the officer that the appellant was the person who signed the exporter's declaration could not and should not be admitted without a voir dire. Secondly, he said that the letter written by the appellant should also have been the subject of a trial within a trial or alternatively the learned magistrate should have excluded it on the ground that it was obtained unfairly. Thirdly, exhibits P9 and P10 which were the contracts Easze Garment Factory entered into with Hansa Trading Limited and Ho Cheong Textiles Limited respectively for the manufacture of the 1,010 pieces of ladies cotton woven trousers and the purchase of the materials were inadmissible. In essence I think that these were his complaints if I understood him correctly.

9. The principle relating to the admissibility of confessions is that enunciated by Lord Sumner in his speech in Ibrahim v R. [1914] A.C. 599 at page 609:

"It has long been established as a positive rule of English criminal law that no statement by an accused is admissible in evidence against him unless it is shown by the prosecution to have been a voluntary statement in the sense that it has not been obtained from him either by fear of prejudice or hope of advantage exercised or held out by a person in authority."

In re-affirming this principle in D.P.P. v Ping Lin [1975] 3 All E.R. 175, the House of Lords added oppression as a ground for the exclusion of a confession. A voir dire or trial within a trial only arises where the question of voluntariness is in issue. No such enquiry is however necessary if there has been a breach of the Judges' Rules only. The relevant rules in the 1964 Judges’ Rules are as follows:

"I. When a police officer is trying to discover whether, or by whom, an offence has been committed he is entitled to question any person, whether suspected or not, from whom he thinks that useful information may be obtained. This is so whether or not the person in question has been taken into custody so long as he has not been charged with the offence or informed that he may be prosecuted for it.

II. As soon as a police officer has evidence, which would afford reasonable Grounds for suspecting that a person has committed an offence, he shall caution that person or cause him to be cautioned before putting to him any questions, or further questions, relating to that offence.”

It is true that at the time of his visit to Quelle the officer no doubt had reasonable 8rounds for suspecting that an offence under the Import and Export Ordinance had been committed, but he was entitled to make further enquiries in order to discover the author of the offence. There is no evidence from the record that at that stage the officer had known that the signature on the declaration was that of the appellant or that the officer had evidence to charge the appellant. Even assuming that he knew and that he had evidence, there is nothing to suggest that the admission was obtained by force, threat, inducement or oppression. No question was put to him in cross-examination that the admission was involuntary. At best, there was a breach of the Judges' Rules which is not a ground for holding a voir dire and it is only a matter of discretion.

10. In relation to the letter written by the appellant, counsel for the appellant had this to say to the learned magistrate:

"I have already raised my objection. Its receipt in evidence would be unfair because it was not written in the realisation that it would be given in evidence. It was written at a time when he was being investigated. The Crown must show it was written with his full realisation it would be used against him. I am inviting court to exclude it as being improper. I am not asking court to hold a voir dire."

I must confess that I am at a complete loss and so was the learned magistrate to understand the basis of this objection. In any event the learned magistrate refused to exercise her discretion and she was right to do so.

11. Exhibits P9 and P10 were received by the proprietor of Easze Garment Factory in the ordinary course of his business and produced from his custody as part of his business record and as such they are clearly admissible as original evidence, not to prove that they are true but to prove that they were made. If authority is required, there is an abundance of it. In Subramaniam v Public Prosecutor [1956] 1 W.L.R. 965 at page 970, the Privy Council decided:

“Evidence of a statement made to a witness by a person who is not himself called as a witness mayor may not be hearsay. It is hearsay and inadmissible when the object of the evidence is to establish the truth of what is contained in the statement. It is not hearsay and is admissible when it is proposed to establish by the evidence, not the truth of the statement, but the fact that it was made.”

In Woodhouse v Hall (1981) 72 Cr. App. R. 39, the defendant was charged with managing a brothel at certain premises (described as a sauna). In order to prove that the premises were, in fact, being used as a brothel, the prosecution sought to adduce evidence of conversations between police officers and women employed at, the premises as masseuses. During these conversations (which 1i.rere in the absence of the defendant) the women offered the police officers sexual services. The evidence was clearly relevant to the issue of whether the defendant was managing a brothel in the premises or a sauna. The Divisional Court ruled that the evidence was admissible because the relevant issue was not whether the statements were true or false, but whether the offers were made. The fact that the offers were oral made no difference to admissibility.

12. When the learned magistrate first admitted these two documents she admitted them solely for the purpose of showing their existence but counsel for the appellant chose to cross-examine on the contents of the documents and as a result the learned magistrate ruled that the contents also became evidence. In my opinion, she was right. This matter was discussed in Cross On Evidence, 6th edition at pages 281 and 282:

“But there are situations in which a document may become evidence of the facts stated in it by virtue of the common law rules concerning cross-examination.”

13. The decision of Wrangham J. in Stroud v Stroud [1963] 3 All E.R. 539 was cited and so was the Australian decision in Walker v Walker (1937) CLR 630. This rule applies to both civil and criminal cases but has been recommended for abolition by both the English Criminal Law Revision Committee and the Australian Law Reform Commission. Be that as it may, this is still the law before any statutory intervention.

14. Moreover, the learned magistrate made it clear that even without P9 and P10 there was ample evidence to prove the charge against the appellant and I entirely agree. The evidence was overwhelming and in my judgment the case was not arguable. This is a perfectly simple and straightforward case and I lament to say-that it was made confusing and complicated by counsel for the appellant.