HKSAR v. TSANG CHI SANG AND OTHERS

HCMA1076/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

(Appellate Jurisdiction)

MAGISTRACY APPEAL NO.1076 OF 1999

(On Appeal From NKCC 3836 of 1999)

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J U D G M E N T

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1. The 1st appellant was convicted on the 3rd of November 1999 of theft, the 2nd appellant was convicted on the same day of two counts of procuring an entry in the record of a bank account by deception, and the 3rd appellant was convicted on the same day of procuring an entry in the record of a bank by deception. Each of them appeals against the convictions and sentences.

2. The case in respect of the 1st appellant was that on 15 May 1999, a man named Chau Man Fai was approached in the street and invited to go back to the office of the 1st appellant where he was to be tested for a part in an advertisement. Various representations were made to him as to the amount of money he could earn and he signed a contract undertaking to pay a monthly fee for make-up and for other services to be provided to him. He was given a machine into which to enter the personal identification number of his bank card, and a sum of $19,800 was debited from his account. Mr Chau gave evidence that he had been cheated by the 1st appellant and that he had no intention of that sum being deducted from his account but, at the most, had consented to a figure which involved some two to three months' payment under the contract, i.e. a sum of $3,000-4,000.

3. The magistrate found that Mr Chau did not know what he was paying for, nor which account the money was to come from. He further found that he did not see the amount entered on the machine when he entered his PIN number, and that the 1st appellant had misled him into believing that his savings account was the account selected.

4. The magistrate, in his reasons, said this :

"I rejected Defence Counsel's assertion that PW2 had deliberately deposited $19,530 into his account to cover the later debit of $19,800. I found this deposit had been made by PW2 before he went to Goaline International Company Limited and I found it could not have any bearing on the events that took place in the company. ...."

It is this finding that forms one of the grounds of appeal. The magistrate had specifically found that the sum of $19,530 had been paid into the account of Mr Chau prior to the events that gave rise to this prosecution.

5. The bank statement of Mr Chau was an exhibit before the magistrate and it has been drawn to my attention that the sum of $19,530 was paid into the account not on or prior to the 15th of May 1999, but on the 17th of May 1999. This means it was paid into the account after the alleged offence took place and not before. The payment into the account of this sum of money supports the defence's contention that Mr Chau paid it in to meet what he knew to be a payment out to Goaline on the 15th of May 1999. Had the magistrate properly appreciated the timing of the payment, he may well have come to the conclusion that Mr Chau was not misled by the 1st appellant and would have come to a different conclusion.

6. This mistaken fact by the magistrate is fundamental to the decision he made, and the appeal against conviction is allowed in respect of the 1st appellant and the sentence is set aside.

7. The case against the 2nd appellant involved a situation similar in fact. Lau Wing Hei was approached in the street to do part-time modelling work and after discussion, was taken back to the office of the appellants. The 2nd appellant dealt with him and told Mr Lau that he could be introduced to a commercial assignment after he had completed a casting test. The test took place, and Mr Lau was given a contract that he was asked to sign. He was told that after he signed that there would be work available to him. He was told that there would be a monthly fee of $1,650 payable, and Mr Lau handed over his bank card and the other credit cards to the 2nd appellant.

8. In respect of the 1st charge against the 2nd appellant, it was alleged that a debit entry in the amount of $1,650 was made in a Chase Manhattan Bank account in the name of "Lau Wing Hei". The evidence before the magistrate in respect of that entry was from an affirmation before him of Tse Yuk Hung, an employee of the Chase Manhattan Bank. That affirmation was placed before the magistrate pursuant to section 20 of the Evidence Ordinance. He testified in that affirmation that a visa card had been issued to Lau Wing Hei and produced what was titled "On-Line Authorizations Account Activity Report" for 29 May 1999. He said this :

".... According to this document, an [sic] transaction in amount of $1,650.00-HK was made by the 'Visa' supplementary card numbered 4508-8571-0143-7210 at 2046 hours on 29 May 1999 with approval code '006348' for the Shanghai Commercial Bank coded 454873."

That visa card was the card issued to Mr Lau. Later in the affirmation, Mr Tse said this :

"Till then, the Shanghai Commercial Bank has not billed any transaction with the Bank related to the aforesaid transaction specified in paragraph-12."

9. The effect of these documents is this. On 29 May 1999, as a result of an on-line inquiry, the Chase Manhattan Card Company Limited authorized the debit for the sum of $1,650 against the card held by Mr Lau. Notwithstanding that authorization, no debit was ever made to the account of Lau Wing Hei. That means that whilst approval was granted for the making of a debit entry in the account of Mr. Lau no such entry was made.

10. The magistrate, in his findings, said :

"I found that PW4 was induced to make payments from his account, and entries were made in respect thereof, as a direct result of false representations made by D2 to him which led him to believe that a bank credit card commercial was available to him and that he was to be paid $32,000 for doing the single day's commercial plus $1800 overtime payment allowance if it overran eight hours work. ...."

The magistrate was in error in finding that a payment had been made from the account of Mr Lau, and in error in finding that an entry had been made in the account debiting the sum of $1,650.

11. This conviction cannot stand, and the appeal of the 2nd appellant in respect of the 1st count against him is allowed and the sentence set aside.

12. The 2nd charge against the 2nd appellant involved the sum of $4,200 debited against the account of Mr Lau with the HSBC. In respect of that transaction, the sum of $4,200 was keyed into a handheld machine which transmitted the particulars of the entry and the personal identification number of Mr Lau to the bank so as to effect a debit against his account. The machine is in two parts : a handheld appliance into which the amount, the personal identification number and a confirmation (by pressing a particular button) are entered, and a base upon which that handheld unit sits. Until the confirmation button is pushed and the handheld part of the machine is returned to the base, no transaction is effected.

13. Mr Plowman, SC, argues that there was no evidence before the magistrate that the confirmation button was pressed by Mr Lau, nor that he returned the handheld unit to the base unit. He argues that if a person other than Mr Lau had pushed the confirmation button, then the finding by the magistrate that the entry in the bank record was effected by Mr Lau was in error. And further, if the 2nd appellant returned the handheld part of the EPS machine to the base, thereby completing the transaction, the 2nd appellant would have been making the entry and that that entry could not have been procured by deception as the 2nd appellant could not have deceived himself.

14. I am not attracted by this argument. In any transaction that results in the entry in the bank record of an account holder, there will be steps and processes essential to the making of the entry performed by persons other than the account holder often without the knowledge of the account holder. If the other elements of the offence were made out the magistrate was entitled to find that if the account holder performed an essential step within the chain necessary to effect the entry of the transaction, then that was sufficient to make out the charge. In this case, the entry by the account holder of his personal identification number in the handheld machine, whether or not he pressed the entry button, was a sufficient essential step for the magistrate to be entitled to find that the offence had been made out.

15. The appeal against conviction in respect of the 2nd appellant upon the 2nd charge is dismissed.

16. The case against the 3rd appellant involved much the same factual account as the charges against the 1st and 2nd appellants. A man named Chung Sai Ho was solicited for a job as a model while in the street and went back to the offices of the appellants where he filled out a personal information form. He signed a contract and accompanying documents and handed over his bank card. On two occasions he entered his personal identification number into the handheld unit of a machine which would debit his account on each occasion with the sum of $1,650.

17. Mr Plowman raises, in respect of this conviction, the same arguments as he raised in respect of the 2nd appellant on the 2nd charge faced by that appellant, i.e. that there is no evidence that Mr Chung pushed the confirmation button on the handheld unit, and that if the machine was returned to the base unit by the 3rd appellant, then he could not have deceived himself by procuring the entry.

18. As I have said, that argument does not attract me and the appeal cannot be allowed on that basis.

19. There is, however, a further matter. The charge faced by the 3rd appellant was that she dishonestly, with a view to gain for herself or another or intending to cause loss to another by deception, procured the making of an entry in a record of the HSBC, namely a debit in the amount of $3,300 Hong Kong Currency in the account of Mr. Chung. The magistrate, in his reason, said this :

"I found that PW5 did not know at the time of signing the documents and paying over his money that he was paying for a ten session course. I found that when Exhibit P29 was seen by PW5 the sum of $3300 had not been entered thereon, and I found it was very likely that the same applied to Exhibit P30. I found the sums were only inserted later in a similar manner as had been adopted for PW2 and PW4's copies of the same. ...."

The fact is that no entry in the record of the HSBC being a debit in the amount of $3,300 existed. Mr. Chung could not have seen an entry for $3300 as no such entry was made. There were two entries, each in the sum of $1,650, and whilst they amounted to $3,300 in total, they were not an entry in that sum.

20. Section 119(1)(d) of the Magistrates Ordinance, Cap.227 reads :

"The judge may by his order confirm, reverse or vary the magistrate's decision or may direct that the case shall be heard de novo by a magistrate or may remit the matter with his opinion thereon to a magistrate, or may make such other order in the matter as he thinks just, and by such order exercise any power which the magistrate might have exercised; and any decision or order made by the judge shall have the like effect and may be enforced in the like manner as if it had been made by the magistrate;"

21. On the facts before him the magistrate would have been entitled to convict the 3rd appellant upon the basis of an entry in the sum of $1650.

22. Accordingly the appeal of the 3rd appellant against conviction is dismissed.

23. I will now hear the appeals of the 2nd and 3rd appellants against sentence.