THE QUEEN v. NG FUNG KING, CINDERELLA

IN THE HIGH COURT

1993, No.374
Magistracy Appeal

Headnote

Sentence - Breach of Import and Export (General) Regulations in respect of textiles subject to quotas - Whether guideline in A.G. v. Marvels Clothing Co. Ltd.  [1987] HKLR 837 should be adhered to by sentencing magistrate - whether The Queen v. Tele-art Ltd. MA No. 1121 of 1986 (Roberts CJ, unreported) is consistent with Chow Chi-man [1980] HKLR 703. Held : Fine imposed by magistrate set aside and substituted by one representing approximately 30% of F.O.B. value of goods exported.

IN THE HIGH COURT

1993, No.374
Magistracy Appeal

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J U D G M E N T

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Litton, J.A.:

1. This is an appeal against sentence. The appellant Ng Fung King was convicted by Mr. Tam at the Tsuen Wan Magistracy on 27 April 1993 on two charges of exporting textiles to the United Kingdom otherwise than under and in accordance with a licence, contrary to Regulation 4 of the Import and Export (General) Regulations. The first charge relates to an offence committed on 7 June 1991 in which 6,008 pairs of cotton woven jeans were exported. In relation to the second charge the offence occurred on 4 July 1991 in which 4,689 pieces of cotton woven anoraks were exported. On the first charge the Magistrate imposed a fine of $150,000 and on the second charge he imposed a fine of $244,000. The Magistrate in imposing the sentences took as his starting point 50% of the FOB value of the goods exported; taking into account the fact of the guilty plea and administrative penalties imposed on the appellant by the United Kingdom Customs authorities and other charges - which amounted to approximately £11,000 - he imposed fines which represented approximately 40% of the FOB value of the goods.

2. The scheme which lay behind the appellant’s guilty pleas was in essence a scheme to defraud the Trade Department in relation to what was called a transhipment cargo exemption scheme which enables textiles to be transhipped through Hong Kong by the use of through-bills of lading without any requirement for an export licence. The investigations which gave rise to these charges began in November 1991 and the Customs and Excise Department suspected that there was a scheme on foot where garments produced mainly in China were exported to Europe and the USA in the guise of transhipment cargoes from the Philippines. The scheme involved a quota broker who supplied false Philippine documentation for the purpose.

3. It is common ground that the judgment of the Court of Appeal in A.G. v. Marvels Clothing Co. Ltd. [1987] HKLR 837 governed this case. There the Court of Appeal held that for reasons of consistency and uniformity sentencing courts in this type of case should upon conviction after trial take as a starting point 40% of the FOB value of the goods.

4. On this appeal the appellant’s counsel Mr. Macrae submits that the sentences imposed by the Magistrate are both manifestly excessive and wrong in principle and three submissions were made. (1) Counsel submits that the judge erred in principle in using as his starting point for the purpose of sentence 50% of the FOB value of the goods. The Magistrate did this because the appellant had five previous convictions two of which were of the same kind. Counsel argues that this is wrong in principle because in effect what the Magistrate has done is to have sentenced the appellant upon his past record rather than for her criminality in relation to the two offences to which she had pleaded guilty. Counsel invokes the judgment of the Court of Appeal in The Queen v. Woo Kau Cr.App. No. 422 of 1986, (9 October 1986, unreported) in which the Court approved the dictum of Bewley J. in R. v. Chow Chi-man [1980] HKLR 703 where he said that previous convictions might disentitle a defendant to any sympathy from the court but were not a ground for increasing the normal sentence for that offence. Counsel argues that whilst it would have been perfectly proper for the Magistrate to have given little discount from the starting point because of a bad record it was wrong in principle to jack up the starting point because of the appellant’s past record.

5. I have also been referred to the case of The Queen v. Tele-art Limited, MA No. 1121 of 1986, Roberts, CJ (21 November 1986, unreported) where there were two charges involved, both relating to importing watches to which false trade descriptions had been applied. There the former Chief Justice, with reference to the case of Marvels Clothing Co.  Ltd., said this:

“However, the suggested 40% is not intended to be more than a guide and I see no reason why a magistrate should not impose a somewhat higher amount when bearing in mind the record of a defendant.”

6. In relation to the defendant in that case, Roberts CJ said that giving weight to that principle, he would have imposed on the defendant fines at the rate of 50% of the market value of the goods concerned on account of one previous conviction for a similar offence.

7. It does appear to me that the approach of the court in Tele-art Limited is slightly at variance with the judgment of the Court of Appeal in Woo Kau. Obviously where a court has laid down guidelines, as the Court of Appeal has done in Marvels Clothing Co. Ltd. these are not intended as impenetrable ceilings; there would be circumstances where, for exceptional reasons, a court might consider a starting point higher than the tariff suggested. One such case would, I suggest, be where the court has before it a persistent offender and in sentencing him the court has concluded that a deterrent sentence would have to be imposed, the application of the tariff having clearly failed on previous occasions to deter, in relation to the same offender. It must however always be borne in mind that there is an important public interest at stake in adhering to a “tariff”: it ensures consistency of approach and eliminates the notion of “judicial lottery” in being sentenced by one magistrate rather than another.

8. I therefore question whether the mere fact of one or two previous convictions for similar offences would justify a departure from the normal starting point. If it did, then it would conflict with the principle in Woo Kau.

9. In this case the two previous convictions for a similar offence had occurred approximately three years and four years prior to the date of the offences in this case. In my judgment the appellant’s record was not such as would have justified approaching this as a case where deterrence was paramount.

10. In sentencing the appellant this is what the Magistrate said :

“This is not the first time you committed this kind of offence. A fine of 50% of the FOB value of the goods is appropriate in your case.”

11. In my judgment the starting point of 50% in the circumstances of this case was not justified; the Magistrate should have used as his starting point 40% as laid down in the case of Marvels Clothing Company Limited.

12. (2)     Counsel argues that the reduction of 10% of the FOB value was too low having regard to the guilty plea and the other circumstances. This represented in effect a 20% discount on the sentence. Counsel argues that for the guilty plea alone the Magistrate should be taken as having allowed a discount of 20% on the sentence, that is to say 10% reduction of the FOB value. And this then leads to the logical conclusion that he failed to take into account two other matters in mitigation: (a) The fact that the appellant had already incurred substantial penalties in the United Kingdom, which amounted to approximately £11,000 and (b) the fact that the appellant had offered to cooperate with the authorities and to give evidence at the trial of the quota broker. As to the latter, I cannot see how the Magistrate can be criticised if he had not taken that offer into account, if indeed he did. These are matters peculiarly within the discretion of the sentencing court and how that weighs in the scales is a matter for the Magistrate’s judgment. Whilst the reduction of 10% overall cannot be said to be generous, I am not persuaded that the Magistrate had erred by not discounting more.

13. (3)     Counsels argues that the result of this case is grossly at variance with 15 other cases dealt with by a number of magistracies involving substantially the same facts and the same quota broker.

14. A table of those cases has been prepared and the facts are not in dispute. The dates of sentence range from 29 December 1992 to 26 March 1993. Approximately half the defendants had previous convictions and the rest had clear records. In those 15 cases the sentences were fines ranging from 12% to 20% of the FOB value of the goods. There is of course good authority to the effect that simply because a sentence was lenient in another court does not mean that a magistrate has erred in his approach in the instant case. His responsibility is to impose a proper sentence in relation to the matter in hand. Moreover, viewing from the outside, it would be difficult for a magistrate to evaluate all the individual factors which went to the imposition of the sentences in the other cases. But, nevertheless, if one approached the matter broadly in this case, there is the rather startling result that, in the 15 other similar cases in relation to offences occurring at about the same time, none of the sentences imposed by other magistrates was higher than half the fines imposed in this case. This must surely require the magistrate to have another hard look at his own sentence.

15. I would not on account of the third ground alone have disturbed the sentences in this case. But having regard to my conclusion on the first ground of appeal, it must follow that the magistrate had erred in principle because he took a higher starting point than was justified upon the facts before him. The sentence is therefore set aside and exercising my best judgment I substitute fines as follows: in relation to the first charge, there shall be a fine of $112,500 and in relation to the second charge, there shall a fine of $183,000. These would represent approximately 30% of the FOB value of the goods involved. In this regard I am guided by the helpful judgment of Barnes J. in the case of Kwok Chiu, MA No. 1406 to 1408 of 1989, 5 December 1989 (unreported) in which case for offences contrary to section 36(1)(a) of the Import and Export Ordinance, he set aside the penalties imposed and ordered fines equivalent to 30% of the value of the goods.

16. The appellant shall have three months from today to pay the fines.