R. v. WONG FUK KOON

IN THE SUPREME COURT OF HONG KONG

(Appellate Jurisdiction)

MAGISTRACY APPEAL
NO.1050 OF 1995

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J U D G M E N T

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Duffy, J.:

1. This was an appeal against conviction on three charges of theft. The facts were that Zhonge Audio Equipment Company Limited ("Zhonge"), a company registered in China, sold some audio equipment to a Hong Kong firm called Annet Industrial Company Limited ("Annet") in 1992. Zhonge had difficulty in securing payment for the equipment, but Annet issued 12 cheques to cover the full amount of $1,037,896. Three of the cheques were honoured, but the remaining nine were not. The amount then outstanding in January 1993 was $778,422.42. Annet still delayed payment so Zhonge called in Chung Sheung Trading Debt Collect Consultant Company ("Chung Sheung"), a Hong Kong company, to recover the debt. They signed a power of attorney authorising Chung Sheung to act for them to make collection of the debt. The agreement between Chung Sheung and Zhonge was signed on 12th November 1992. The evidence was that the debt to Zhonge remain unpaid. Apparently Annet and Chung Sheung came to an agreement that $400,000 would be acceptable in repayment of the full debt. Zhonge had not agreed to this.

2. Evidence was given by Mr Chui Wing Kwong, a Director of Annet Industrial Company Limited, who testified to the matters concerning the debt with Zhonge. He also testified to a visit he received from three men from Chung Sheung on 12th November 1992. According to him, the three men acted in a very threatening manner, as a result of which he called the police. However, an agreement was reached with Chung Sheung that he would pay $400,000 in final settlement of the debt. He identified the Appellant as one of the men. He then gave evidence that on three separate occasions he gave the Appellant amounts of cash which in total settled the full debt of $400,000. He obtained receipts from the Appellant, and the Appellant returned to him the cheques which Annet originally had given to Zhonge and which had not been honoured.

3. The next Crown witness was Mr Lee Ka Tung, who said that he worked for Chung Sheung. He said that in 1992 he personally assisted in collecting the debt due from Annet to Zhonge, and he declared in his evidence that no one else was engaged in collecting that debt. He said he got three cheques from the company, from the Appellant in fact, and that he deposited the cheques into the company account. It was elicited from him in cross-examination that the cheques amounted in total to a sum in the region of $300,000 to $400,000 and that the only person in Chung Sheung who could sign cheques was Lo Ka Ming, its registered proprietor. The implication then was that if the cheques were deposited into Chung Sheung's account, the Appellant did not have access to the funds and therefore could not have stolen them.

4. Why the Crown called PW3 is difficult to understand because the evidence of PW2 and that of PW3 was completely contradictory as to the way in which Annet paid the money over to Chung Sheung. A fair reading of PW3's evidence must, if the learned Magistrate believed PW2, lead to the conclusion that he was deliberately trying to mislead the Court, and that the Crown's case was completely inconsistent. However, this is what the learned Magistrate said :

"Nevertheless, PW2 impressed me as a shrewd and observant person. The first meeting, being of such a nature that he felt the need to call the police, was likely to have had a vivid impression on him. In the later meetings, he was handing over large sums of money, in respect of which he insisted on being given receipts. He produced the copies of those receipts. I had no doubt that he would have taken careful notice of the person to whom he gave the money, and by whom the receipts were signed. And his identification of the appellant as that person was supported by PW3's later unchallenged evidence that the appellant 'was maybe the 'Boss' of C.S. He managed the Company". I found that PW2's identification of the appellant was correct.

PW3's evidence was important for the support it gave to PW2's identification, as noted. He explained that the registered proprietor of C.S., one Lo Ka-ming, had nothing to do with the collection of Annet's debt to Zhonge. PW3 impressed me as a fairly unintelligent witness, doing his best to recall truthfully events in which he had never had a great deal of interest. He said that he was the only person involved in the collection of the debt, a piece of evidence which, although it appeared to assist the appellant, was plainly incorrect. He went on to describe collecting cheques from Annet, payable to C.S., and depositing them in the bank. He further described how such cheques were given to him by the appellant, who used the name 'Ah To'. I found that PW3 was given cheques by the appellant to take to the bank, and that the appellant was at the time managing C.S. and was using the name 'To'.

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Having found that it was indeed the appellant and no one else who received the money from PW2, I had to consider what had happened to it. There was no direct evidence on this topic. The Defence proposition that the cheques paid into the bank by PW3 might have been intended to discharge the debt, but that someone else might have stolen the funds, was unrealistic. There was no evidence that any such cheques had been cleared. There was ample evidence that Zhonge had continued to press for payment of the debt. There was no hint from PW2 that Annet had paid anything towards the debt other than the first three instalments covered by the cheques given to Zhonge before C.S. became involved, and the $400,000 given to C.S. It was an irresistible inference that any cheques that PW3 referred to which related to the debt in question had not been cleared."

5. The learned Magistrate did not appear to come to terms with the complete contradiction between the evidence of PW2 and PW3. Indeed he himself made the apparently contradictory findings that PW2 received payment of the debt in cash from the Appellant, and also that PW3 was given three cheques by the Appellant, which PW3 clearly intended the court to believe was payment of the same debt. He did not analyse the issues involved in PW3's claim that he was the only one collecting the debt, but simply said it "was plainly incorrect", while finding that PW3 was trying his best to tell the truth, and he went on later to say that there was an irresistible inference that the cheques given to PW3 had not been cleared. The fact of the matter was that the Crown called no evidence in relation to these cheques, and made no effort to call any evidence in relation to Annet's bank accounts, and it was, therefore, in the absence of any resolution of the complete inconsistency between PW2 and PW3, simply not open to the learned Magistrate to find that there was an irresistible inference that the cheques had not been cleared. A finding that they had never existed might have been more understandable.

6. Neither counsel who appeared for the Crown on the appeal nor counsel for the Appellant could offer an explanation for the extraordinary way in which the Crown presented its case, nor for the apparent contradictions in the learned Magistrate's findings. It was not a safe or satisfactory conviction and I allowed the appeal.