HKSAR v. PAUL Y - ITC CONSTRUCTION LTD.

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

Magistracy Appeal
1997, No.476

HEADNOTE

Criminal law - strict liability offences - Noise Control Ordinance (Cap.400) s.6(1)(a) and s.6(2)(a) - meaning of "cause" - defence of reasonable but mistaken belief available.

Obiter - fines should properly reflect society's concerns - manifestly low penalties almost an incentive to commit future breaches.

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

Magistracy Appeal
1997, No.476

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J U D G M E N T

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Stuart-Moore, J.A. (giving the judgment of the Court):

1. This matter comes before us as the result of a reference by Yeung J. to this court on 10th March 1998 under the provisions of section 118(1)(d) of the Magistrates Ordinance, Cap.227, following an application made by counsel on behalf of the Appellant for the hearing to be transferred to the Court of Appeal.

2. Paul Y - ITC Construction Limited (the Appellant) faced two summonses in the Eastern Magistrates' Court which were tried by Mr. Sham.

3. The first summons alleged that on 24th November 1996, which was a general holiday, at about 10:50 a.m. the Appellant, "at 1 Cityplaza, Taikoo Shing, Lot No.QBML2, Quarry Bay, which was situated within a designated area, did cause to be used powered mechanical equipment, namely one steel bar bender and cutter and one loader for the purpose of carrying out construction work other than percussive piling in respect of which a construction noise permit was not in force." The offence was contrary to section 6(1)(a) and (5) of the Noise Control Ordinance, Cap.400.

4. The second summons related to the same time, date and place, and alleged that the Appellant "caused construction work to be carried out prescribed for the purposes of section 6(2) of the Noise Control Ordinance, Cap.400, namely handling of steel bars, in respect of which a construction noise permit was not in force." This offence was contrary to section 6(2)(a) and (5) of the Noise Control Ordinance.

5. The learned magistrate found the Appellant guilty on both summonses and, on 15th April 1997, imposed a fine of $10,000 on each. This appeal is against conviction on both summonses.

6. The Noise Control Ordinance sets out, amongst other things, "to provide for the prevention, minimizing and abatement of noise". This appears in the preamble to Part I of the Ordinance.

7. The relevant offences are defined under the sub-heading to the section: "Noise from Construction Sites". Section 6 reads:

"(1) Subject to subsection (6), any person who at any place between the hours of 7 p.m. and 7 a.m., or at any time on a general holiday, uses, or causes or permits to be used, any powered mechanical equipment for the purpose of carrying out any construction work other than percussive piling -

(a) in respect of which a construction noise permit is not in force ..... commits an offence.

(2) Subject to subsection (6), any person who at any place within a designated area between the hours of 7 p.m. and 7 a.m., or at any time on a general holiday, carries out, or causes or permits to be carried out, any construction work prescribed for the purposes of this subsection-

(a) in respect of which a construction noise permit is not in force .... commits an offence.

(5) Subject to subsection (6), any person who commits an offence under this section shall be liable-

(a) on first conviction to a fine of $100,000;

(b) on second or subsequent conviction, to a fine of $200,000 ..."

8. Subsection (6) is, for present purposes, not relevant.

9. Section 33 of the Ordinance provides specific defences to proceedings brought under section 6 and also other sections, but these defences are in no sense relevant to this case.

10. The 'live' evidence called before the magistrate fell within a narrow compass. Two Environmental Protection Inspectors (PW's 1 and 2) and an employee of the Appellant (PW3) were called as witnesses. No evidence was called on behalf of the Appellant. In addition, and most importantly, agreed evidence was placed before the court to the effect that the Appellant was the main contractor of the construction site in question and that construction work had commenced in 1995.

11. The essence of the prosecution's case was concisely set out by the magistrate in the bundle before us at p.78, where he said:

"PW1 and PW2, together with two other colleagues, went down to inspect the construction site in question on 24th November 1996 in response to a complaint of noise. They arrived at the construction site and found two persons operating a steel bar bender, the activity of which generated noises. They then asked the watchman on the site to see the person-in-charge. Subsequently, they met PW3, Lau Wai-kin, who claimed himself to be the sub-agent of the site and employed by the Appellant. They pointed out to PW3 that the work carried out by the two persons had violated the Noise Control Regulation. They then proceeded to the site office with PW3. Whilst on their way, they came across another person driving a mini-loader on the site. Upon see this, PW3 immediately shouted to that person to stop the work which he did. One of the inspectors had taken photographs of the activities of the three persons on the spot and produced these as exhibits in the case.

When they got to the site office, PW3 admitted to the inspectors that he was required by the Appellant to work on that day, which is a Sunday, and they had not obtained any Noise Permit for the site."

12. The magistrate then went on to say that he found:

"PW1 and PW2 to be truthful, reliable witnesses. I was satisfied so that I was sure beyond all reasonable doubt that the event given in evidence by them took place as they described. PW3 was the employee of the Appellant on 24th November 1996 as well as at the present. I had seen and heard his evidence. I did not find him to have been frank with the court. PW3 testified that he had not seen anyone operating the steel bar bender. However, such evidence was contradicted by PW1 and PW2, who said that PW3's attention was specifically drawn to the two persons operating the bar bender at the time. PW3 must have seen it. In fact there was no evidence to suggest that the two persons were told to stop what they were doing and I do not believe they would stop the work without any instructions from anyone. PW3 even denied having taken the inspectors to the site office where he made certain admissions to the inspectors. PW3 impressed me as a witness who would give evidence in favour of the Appellant regardless of the truth wherever possible. I should treat his evidence with caution. Whenever his evidence was in contradiction with PW1 and PW2, I rejected his evidence and I would not attach too much weight to his evidence generally."

13. The magistrate decided that the two sections of the Noise Control Ordinance in question were concerned with issues of social concern, namely public nuisance. He concluded, therefore, that these were offences of strict liability. He found that the Applicant had "caused" the prohibited acts and, in this regard, said at page 80 of the Reasons for Verdict:

"The evidence which I accepted indicated that apart from the Appellant being the main contractor, there were about 16 sub-contractors, a large number of sub-subcontractors and all of them had employed a large number of workers to work on the construction site. It is true to say that there was no evidence to establish who actually employed the two persons who operated the steel bar bender and the driver of the mini-loader at the material time. It had been suggested by the defence that these persons might even be trespassers. I ruled out such possibility for there were watchmen employed on the site to keep out trespassers. I have come to the conclusion that anyone found working on the site would either be employed by the Appellant or the sub-contractors or the sub sub-contractors. As the Appellant was the main contractor which had contracted works out to others, any workers found working on the site were linked up with the main contractor by way of contractual relationship. The works they did on the site were for the benefit of the Appellant, i.e. to complete the project on the site which the main contractor, the Appellant, was under a contractual duty to accomplish. I had no difficulty in coming to the conclusion that the Appellant had caused the construction works, which included the prohibited acts, the operation of steel bending and mini-loader to be carried out on the site in question. As I had concluded that the sections creating the offences were ones of strict liability, the prosecution did not need to prove that the Appellant had knowingly, intentionally or negligently caused the prohibited acts. In my judgment, the Appellant was also liable, even if the workers in question were working acting contrary to the instruction given by the Appellant, since the works were done for the benefit of the main contractor."

14. Mr. Watson-Brown has advanced three grounds of appeal which can conveniently be dealt with together. They are that the magistrate erred in law that:

(1) he wrongly found that sections 6(1) and 6(2) of the Noise Control Ordinance were offences of strict liability;

(2) he failed to consider or direct himself properly on the meaning of the word "causes" within section 6(1) and 6(2) of the Noise Control Ordinance; and

(3) he failed to consider whether the Appellant was entitled to a defence in the terms set out in Attorney General v Fong Chin-yue and Ors, (1995) 1 HKC 21 of reasonable but mistaken belief that no construction work was being carried out at the time alleged in the information.

15. In Attorney General v Fong Chin-yue (above), the Court of Appeal set out the summary of the rules of construction which the courts have applied to determine what a penal provision really means. For present purposes, these are important when deciding whether an offence is one which carries strict liability. These propositions are themselves taken from the summary provided by Lord Scarman in Gammon (Hong Kong) Ltd. & Ors. v Attorney General, (1985) A.C. 1 and [1984] 2 All E.R. 503, when (at page 508) he said:

"(1) there is a presumption of law that mens rea is required before a person can be held guilty of a criminal offence;

(2) the presumption is particularly strong where the offence is 'truly criminal' in character;

(3) the presumption applies to statutory offences, and can be displaced only if this is clearly or by necessary implication the effect of the statute;

(4) the only situation in which the presumption can be displaced is where the statute is concerned with an issue of social concern; public safety is such an issue;

(5) even where a statute is concerned with such an issue, the presumption of mens rea stands unless it can also be shown that the creation of strict liability will be effective to promote the object of the statute by encouraging greater vigilance to prevent the commission of the prohibited act."

16. Fong's case (above) was concerned with offences under sections 17 and 46 of the Dutiable Commodities Ordinance, Cap.109. It is only necessary to refer to a part of the headnote for a summary of the issues to be found at page 22 line D:

"(3) The four offences in question were strict liability offences but were not truly criminal in character. They sprang not from any inherent evil in the conduct prohibited but from the fact that such conduct was prohibited. However, looking at the whole of the legislative scheme in context, it was a necessary implication of this statute's effect that the prosecution did not have to prove knowledge on the part of the accused that duty was outstanding. This presumption of mens rea was displaced because of the concern to raise revenue and to raise it in a way that treated taxpayers with equality. Greater vigilance would be encouraged by strict liability in promotion of the objectives of the legislation. Gammon (Hong Kong) v. AG of Hong Kong [1985] AC 1 applied.

(4) Alternatively, to interpret the relevant provisions as requiring proof by the prosecution of knowledge would leave a gap through which the guilty could escape in droves. At the same time, to interpret those provisions as precluding a defence of reasonable belief would leave a gap through which the innocent may fall to their harm. By no proper canon of construction could the intention to create either of those gaps be attributed to the legislature.

(5) Consequently, it would be a defence to the four offences in question if the accused could prove on a balance of probabilities that he believed for good and sufficient reason, though erroneously, that the provisions of the Ordinance had been complied with. This included a reasonable belief that duty had been paid.

(6) A magistrate should approach such a defence with fairness and common sense."

17. Some considerations to be borne in mind regarding paragraph (6) are then set out in the headnote which are generally more applicable perhaps to offences under the Dutiable Commodities Ordinance than the Ordinance with which we are concerned in the present appeal. However, "whether the accused gained or stood to gain by offending" is amongst the considerations which might be of equal applicability to the Noise Control Ordinance.

18. Finally, this court in Fong's case came to the conclusion that the offences under sections 17(1), (6) and (8) of the Dutiable Commodities Ordinance were consistent with Article 11(1) of the Bill of Rights Ordinance Cap.383, which reads:

"Everyone charged with a criminal offence shall have the right to be presumed innocent until proved guilty according to law."

19. In the opinion of this court, the reasoning in the judgment which was given in Fong's case is applicable in the appeal presently before us insofar as it concerns our approach to these offences.

20. Returning, therefore, to Lord Scarman's five propositions already cited, the first of these requires no further amplification.

21. The second proposition requires us to consider whether or not the present offences were 'truly criminal' in their nature. Bearing in mind the stated object of the legislation in the preamble to the Ordinance, we have no difficulty in saying that they were not and, to use the same phraseology as this court did in Fong's case at page 32:

"They spring not from any inherent evil in the conduct prohibited. Rather, they spring from the fact that such conduct is prohibited."

22. So far as the third proposition is concerned, we are left in no doubt that the legislation did not intend that proof was necessary of knowledge that the particular breaches which are alleged were being committed. In saying this, we have in mind that part of Lord Diplock's speech in Sweet v Parsley, [1969] 1 All E.R. 347 at 362 in a passage which was quoted in the Gammon case (above):

"But where the subject matter of a statute is the regulation of a particular activity involving potential danger to public health, safety or morals in which citizens have a choice whether they participate or not, the court may feel driven to infer an intention of Parliament to impose, by penal sanctions, a higher duty or care on those who choose to participate and to place on them an obligation to take whatever measures may be necessary to prevent the prohibited act, without regard to those considerations of cost or business practicability which play a part in the determination of what would be required of them in order to fulfil the ordinary common law duty of care. But such an inference is not lightly to be drawn, nor is there any room for it unless there is something that the person on whom the obligation is imposed can do directly or indirectly, by supervision or inspection, by improvement of his business methods or by exhorting those whom he may be expected to influence or control, which will promote the observance of the obligation."

23. This extract conveniently leads to the fourth of Lord Scarman's propositions that the only situation in which the presumption against mens rea can be displaced is where the statute is concerned with an issue of social concern.

24. When Lord Diplock referred in Sweet v Parsley (above) to "public health, safety or morals", this was not in the opinion of this court to be taken as restricting the offences where strict liability may apply simply to transgressions which come under those bare headings. There are many other offences which are not "truly criminal" in kind, and in that obvious and general sense are of "social concern".

25. Fong's case was concerned with offences in relation to dutiable goods. This appeal is concerned with offences relating to noise control which are certainly concerned with public well-being and very closely associated to concerns of public health. Unless properly controlled in Hong Kong, which, it goes without saying, is a densely populated area, unauthorised noise is likely to disrupt the lives of ordinary people, leading in a number of ways to deterioration in health quite apart from the obvious nuisance it poses to the public.

26. If further confirmation were needed, we are fortified in the view that this is an offence which was intended to be of strict liability by reference to an offence under section 4(2) of the Ordinance which reads in this way:

"Any person being the owner, tenant, occupier or person in charge of any domestic premises who between the hours of 11 p.m. and 7 a.m., or at any time on a general holiday knowingly permits or suffers noise which is a source of annoyance to any person to emanate from those domestic premises commits an offence." (emphasis supplied.)

27. It is clear, as the magistrate rightly observed, that the legislature has deliberately chosen to omit "knowingly" from the offences under section 6.

28. Regarding the fifth of Lord Scarman's propositions, it would, as the Respondent points out, effectively render the legislation useless and powerless if only those persons who were actually working on the site could be prosecuted. They would have insufficient funds to pay fines of any size. In these circumstances, the Respondent submits that only strict liability can be regarded as an effective means of promoting the objects of the statute by encouraging greater vigilance to prevent the commission of the prohibited acts.

29. Following Fong's case, we have no hesitation in saying that these offences carry strict liability and are consistent with the Bill of Rights.

30. Both these offences alleged that the Applicant had "caused" the relevant breaches. It will be recalled that the submission on behalf of the Appellant in respect of ground 2 is that the magistrate erred in his interpretation of the word "cause". We were indebted to both counsel who represent the Respondent for their most helpful submissions and, in this regard, to a very large extent we can adopt the written response which they provided in advance of this hearing. The word 'cause' is to be given its ordinary and common sense meaning. (See: Alphacell Ltd. v Woodward, [1972] 2 All E.R. 475 at 479.) It was a question of fact for the magistrate. PW3 was the sub-agent employed by the Appellant company. His duties were to monitor the progress of the construction site work and report it to the manager. He monitored the construction site work by observation and giving instructions to workers employed by the Appellant company. He had to go to the site for inspection every day. When he saw the driver of the mini-loader, he asked him to stop immediately because the act violated the regulations. The driver, who was not an employee of the Appellant company, stopped at once. When workers had work to do there, including workers not employed by the Appellant, PW3 had to go to the site, although he had no control over workers not employed by the Appellant company. The sub-contractors had to report to the Appellant at the contractors' meetings. The Appellant's task was to co-ordinate the work that was being done by the various sub-contractors and draw it together in terms of the contractual obligations to complete the work on the site.

31. The magistrate, in the view of this court, was confronted by overwhelming evidence that the Appellant company had 'caused' the construction work to be carried out. It would have been extraordinary if he had come to any other conclusion.

32. As the Respondent rightly submits, the Appellant had the same responsibility as if it had done the work itself. This could not be delegated or the main contractor would always escape liability by contracting out the work to others. The main contractor initiated the work; it was responsible for the whole site and had a financial interest in the work being carried out. It had contracted out the work to other sub-contractors. The workers committed the offences, but the Appellant caused the offences to be committed by employing the sub-contractors, and thereby the workers, to do the work. There was a direct link between the Appellant company and those who were carrying out the work. They had, in other words, overall control over the site.

33. We come finally to consider the complaint which was made in ground 3. We can express, for the avoidance of any doubt, the view that it would be ( as in Fong's case) a defence for a defendant in the position of this Appellant company to prove on a balance of probabilities that it believed for good and sufficient reason, though erroneously, that there had been compliance with the Ordinance. However, no such defence was even attempted in the present case. The evidence was all the other way. The Appellant company elected not to call evidence. PW3 was its agent and had seen the offences being committed. It was wholly unnecessary for the magistrate to consider this aspect as a possible defence. It never arose and it could never have arisen on the present facts.

34. This appeal has been mounted on grounds that are bereft of reality and they are devoid of all merit. The appeal is dismissed.

35. Finally, we observe with some dismay that this was the fifteenth time in four years that the Appellant company had breached the Noise Control Ordinance. The reason for this observation is that if there had been an appeal against the sentence, we would have considered the fines imposed as being manifestly too low. In a society which is crying out for sensible control over pollution of whatever kind, the penalties should properly reflect society's concern. Bearing in mind that Mr. Watson-Brown has informed us that this was a multi-million dollar contract, no main contractor will ever be deterred by fines being consistently imposed at such low levels. Fines at these levels amount almost to an incentive to commit future breaches of this kind.