HKSAR v. TAI YUE BONG AND ANOTHER

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

1997, No.525
(Criminal)

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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. It is convenient to refer to the applicants by the numbers they were given in the court below where they appeared in the same order as they appear today.

The Charges

2. On 29th August 1997, Tung Ying-ho (D3) was convicted in the District Court following a trial before Judge Chua on a charge of theft contrary to section 9 of the Theft Ordinance, Cap.210.

3. The Particulars of the offence were that in or about January 1996, at World Interlink Company, Rooms 2405-6, Dah Sing Financial Centre, No.108, Gloucester Road, Wan Chai, in Hong Kong, he stole 1,632 calling cards each valued at $500, 619 calling cards each valued at $1,000, and two books of blank receipts, the property of World Interlink Company. D3 now seeks leave to appeal against his conviction.

4. Charges of handling about 1,200 of the stolen calling cards and two blank books of receipts against D1, and assisting in the realization of 113 calling cards against D2, each contrary to section 24(1) and (2), were admitted by D1 and D2 respectively at the outset of the trial. D1 and D2 seek leave to appeal against their sentences only and we shall turn to this later.

Case for the Prosecution

5. The three defendants were employed at all material times by World Interlink Company. World Interlink had radio communication apparatus in Hong Kong and Shenzhen, which enabled it to offer its customers cheaper international calls. The company sold telephone calling cards with a variety of face values including $500 and $1,000. D1 was a salesman, D2 was a technician and D3 worked in the accounts department and had custody of the cards. There were about 20 employees altogether and in overall charge, until his death on or about 15th January 1996, was Anthony Mak. His sudden death brought chaos to World Interlink. The work force was soon reduced to about five and the office was transferred to one room in Harcourt House.

6. In March 1996, following complaints from customers who were finding it impossible to use their cards, a stock check was carried out. It was then that a large quantity of cards and two receipt books were found to have gone missing. D3 was told about this and he suggested that there should be another stock check because of the serious repercussions if the losses were correctly recorded. After that, investigations revealed that the irate customers had purchased stolen calling cards.

7. D1 was arrested on 18th April 1996. He gave to police 86 stolen cards. On 20th April 1996, he led police to another location where he surrendered a further 721 cards.

8. On the same day, D3 was interviewed by police. He wrote, amongst other answers which were given by him:

"I only took the phone cards to them. I didn't take part in sharing the profit among the three."

Case for the Defence

9. The general effect of the answers given to the police, and the request he had made in the office for a second stock check to be done, did not fit comfortably with his defence at the trial. He gave a story that involved him making a personal delivery, at Mr. Mak's request, of telephone cards to Qingdao to a person there who would be an agent for the sale of telephone cards. That person, according to the evidence given by D3, made a refundable deposit of $400,000. D3 testified that he had personally brought back the second instalment of $200,000 into Hong Kong with him and paid this to Miss Choy (PW2) on his return.

10. After Mr. Mak's death, PW2 became the person who was effectively in control of the company. Because she, according to D3, did not appear to know what to do, when D1 told D3 that he had a friend in Dongguan who wanted to be an agent selling the company's cards, D3 allowed a similar transaction to take place. This was to facilitate, according to D3, the company's problems with cash flow, and for this purpose D1 was told that he could have six boxes of cards and that a 400,000 RMB refundable deposit must be paid in cash. D1 was then permitted to fetch the cards and an entry was made in a book which he referred to as the "dealers' book" allegedly kept in a box on the late Mr. Mak's desk.

11. The only documentary exhibit the defence were able to produce in support of any part of this story was a photocopy of a typed letter allegedly given to D3 by Mr. Mak for production to the person in Qingdao. D3 denied telling PW1 or PW2 that a second stock check should be done after large numbers of calling cards had been found to have gone missing. On any view it is obvious that, if he knew where the cards were, he would not have said this.

12. As to the photocopied letter, which bore no signature, D3 alleged that Miss Ada Lo Chu-ping (PW3) had typed it. PW3 denied in cross-examination doing so, and said that she had never even seen the letter before. Furthermore, PW2 had spoken of her knowledge of a venture concerning Qingdao. According to her, this was not related to telephone calling cards but rather to tickets in respect of a yacht club that was to be formed. PW2 did not know about calling cards being sold in Qingdao. She had not been told about the second proposed deal, also involving a large refundable deposit, and at no stage did she receive any money from D3.

13. The failure by anyone to discover what D3 had referred to as the "dealers' book" when answering questions asked by the learned judge, to which we shall later return, and the production of a contradictory defence witness in the form of Lawrence Tam, understandably contributed to the trial judge's inability to accept what D3 or his witness had said. As the judge put it at page 5 in the Reasons for Verdict:

"I am satisfied beyond reasonable doubt that both D3 and Tam were lying. There was no deal in Qingdao to sell telephone calling cards nor was there one for Dongguan. Neither of them were permitted to assume a managerial role after Mak's death. There was no dealers' book."

Ground 1

14. Mr. Eric Kwok, for D3, argues in his first ground of appeal that evidence given by that defendant had been rejected without justification and he highlights two pieces of evidence in support of his submission. Firstly, he says that the judge was in error in saying in one part of her Reasons that if D3's intention had been purely to "facilitate the cash flow problem, it would not be necessary for D1 to be given the receipt books."

15. Here his point is aimed at the absence of direct evidence against D3 that he had provided the books to D1. There was evidence against D1 and D2 because both of them had admitted facts to that effect. D3, on the other hand, had given evidence denying that he had given receipt books to D1.

16. The second piece of evidence is concerned with the number of cards which D3 said he had provided to D1. In total, he testified that there were about 1,500 or slightly more. Mr. Kwok argues that there was no basis for the trial judge in her Reasons to say:

"Although the six books of callings cards should have contained 1,500 cards, I am satisfied that there were more than the usual number in the boxes he gave D1."

17. The full number of cards stolen is set out in the charge, although in her Reasons for Sentence the judge is shown, as Mr. Kwok pointed out to us this morning, as being wrong in giving the total number as 1,632, but in either event it was more than the 1,500 cards that would normally have been contained in the six boxes which D3 said that he allowed D1 to take.

18. As to both points, the evidence which gave rise to inferences being drawn in the terms which were expressed by the trial judge was clearly present. However, the trial judge did not say that she had drawn those inferences and, had she done so, there would have been no point to raise. Nevertheless, it is clear to us that that is what she had done in order to reach those particular conclusions and she cannot be criticised for having done so. It is hard to see, indeed, how she could have reached any other conclusions in the light of her findings.

19. These were only two conclusions amongst several that she reached in deciding the case unfavourably from the defendant's point of view. They were by no means the most important points, and so far as the second point is concerned, even if the number of cards had fallen short of the amount referred to in the charge, theft would still have been made out on the reduced number.

Ground 2 - Interruptions of defendant by judge during evidence in chief

20. The second ground of appeal is that D3 did not have a fair trial in view of the interventions by the trial judge in examination-in-chief. We have had the benefit of the full transcript of D3's evidence, and we can see, even on a superficial glance, as we have made clear to counsel during the course of this hearing, that the interruptions by the judge were made too frequently and sometimes unnecessarily. On the other hand, many of the interruptions were perfectly justified.

21. This ground of appeal is not unknown to this court and, as recently as 8th January 1998 in Criminal Appeal No.35 of 1997, the position where counsel was frequently interrupted was considered in some detail. We are more than a little surprised that counsel for the Respondent did not cite at least this case. In the event, little harm is done as one of this Court was involved in that other decision. In particular, the Court at page 4 of the judgment had in mind the principles which emerged from R. v. Matthews (1984) 78 Cr App R 23, which reads, from the judgment of Purchas L.J., at p.32:

"... the following propositions appear to emerge:

(1) Whilst a large number of interruptions must put this court on notice of the possibility of a denial of justice, mere statistics are not of themselves decisive; (2) The critical aspect of the investigation is the quality of the interventions as they relate to the attitude of the judge as might be observed by the jury and the effect that the interventions have either upon the orderly, proper and lucid deployment of the case for the defendant by his advocate or upon the efficacy of the attack to be made on the defendant's behalf upon vital prosecution witnesses by cross-examination administered by his advocate on his behalf; (3) In analysing the overall effect of the interventions, quantity and quality cannot be considered in isolation, but will react the one upon the other; but the question which is posed ultimately for this court is 'Might the case for the defendant as presented to the jury over the trial as a whole, including the adducing and testing of evidence, the submissions of counsel and the summing-up of the judge, be such that the jury's verdict might be unsafe?' In the presence of conditions in which this Court has been alerted in the manner to which we have referred, it appears to us that if there is a possibility of a denial of justice then this Court ought to intervene."

22. In Criminal Appeal No.35 of 1997, the Court went on to consider the position of the District Court, as also considered in R v Lau Hing-on (1987) H.K.C. 89, and quoted a reference in Lau's case to the case of Jones v National Coal Board (1957), 2 Q.B. 55 and All E.R.155, also cited by Mr. Eric Kwok, in which the principles which apply to the role of a judge are set out.

23. Each case obviously needs to be scrutinized closely on its own facts. We have found ourselves to be in agreement with Mr. Kwok that the number of interruptions by the trial judge was at a level which, in this particular case, was unacceptable. Counsel representing D3 at the trial in the court below, Mr. Albert Luk, was practically sidelined for large parts of the examination-in-chief. He had, so far as we can see, conducted the defence with complete propriety and efficiency and had done nothing deserving of this degree of intervention.

24. It may be that the proper course for the judge to have adopted would have been to have awaited the outcome of the defendant's evidence first before clarifying ambiguities at such an early stage. It appears to us that the trial judge went on a fact-finding mission of her own and was not prepared to listen to the evidence as it emerged from the answers which were being given to defence counsel. Mr. Luk was properly carrying out his duty in laying before the Court the material he believed should be in evidence.

25. Having said that, while not for one moment wishing to give encouragement to interruptions on this scale, many of the questions asked and interruptions made by the judge were relevant to issues that immediately needed to be decided. These were unobjectionable and were sensibly made during the course of examination-in-chief to deal with points as they arose. Examples of this kind are where leading questions were asked or where questions were asked based upon a wrong foundation of fact.

26. However, we were referred to passages that are submitted to have gone beyond this which are said to disclose a hostile intent to D3 whilst he was giving evidence. At the very least, Mr. Kwok argues that they may have given the appearance that they were not asked in a spirit of genuine inquiry. We refer to a passage which has concerned us a great deal which begins at page 53 I in the transcript. The witness D3 was giving an answer recorded as:

"I have mentioned, the conditions and the process of giving the cards to him (D1) and afterwards I allowed him to get ...."

at which point he was interrupted.

"Court:	Did you see him do this?
A.	Yes.
Court:	Did you open the drawer?
A.	No.
Court:	Did you give him the key?
A.	(in English) No, it's unlocked.
Court:	Did you make a record that you gave it to him?
A.	Yes.
Court:	Where is this record?
A.	It was in a dealer book which you have not asked any questions about.
Court:	Well, I've never heard of it. Your counsel has never mentioned the expression 'dealer book'.
A.	(Answer was given but not interpreted)
Court:	Sorry, the term 'dealer book' came from your mouth?
A.	Yes. It was inside Mr. Mak's room.
Court:	Yes?
A.	The dealer book was placed on top of Mr. Mak's desk. It was at the left
	bottom corner.
Court:	What sort of records were kept in this dealer book?
A.	The first column was about the issue date.
Court:	Yes.
A.	The second column serial number.
Court:	Yes?
A.	Third, face value.
Court:	Why weren't these cards entered in the book that we have, 5A? Why did you enter it into
	this dealer book?
A.	(In English) May I have this book? I show you why, can I?
Court:	Of course you can. Before you go to 5A, tell me what Mak put into this dealer book.
A.	The batch of cards in Qingdao.
Court:	You saw this, did you?
A.	Yes.
Court:	You're saying this deal of supplying cards to Qingdao was very secretive, is that right?
A.	Yes.
Court:	So this was a special book he created for it?
A.	(In English) Not just created for it, it's a kind of dealer book. Every dealer ...
Court:	What other deals were recorded in it apart from Qingdao?
A.	(In English) More than 1,000 number of cards.
Court:	You were privy to this book?
A.	Yes.
Court:	He allowed you to see all the transactions she made and recorded in this book?
A.	There was just one transaction, it was the one in Qingdao.
Court:	Well, that's what I said to you. Is it just that one transaction?
A.	Yes."

27. Interpreter then said he further said:

"I have taken out the cards and then I made a record."

28. The Court went on to the next question:

"Court:	Now, when you said that, does that relate to the Qingdao cards, or is this to D1?
A.	(In English) There were two batches. These are two transactions. One transaction is Qingdao
	and the other is D1.
Court:	So the one that Mak entered into the dealer book, he entered it himself
	but you saw it ?
A.	No.
Court:	You entered it?
A.	(in English) I entered it.
Court:	I see. So you entered into this dealer book the Qingdao transaction plus the one you gave to D1?
A.	Yes.
Court:	Thank you. You can't find this book now, is that right?
A.	(In English) No, I can't.
Q.	Why is that?
A.	It's the company asset. If I take it out, I steal it.
Q.	I understand that you made altogether three cautioned statements.
A.	May I finish to describe how to store the dealer book?
Court:	Do you think it's important?
A.	(In English) It's important.
Court:	All right, if you think it's important then tell me.
A.	It's a hard carton box.
Court:	What?
A.	It's a box, a paper box, hard paper box.
Court:	It's not a book, it's a box?
A.	(In English) No, the book stored in the box.
Court:	I see. It's an A4 sized box which stored the book?
A.	(In English) Yes, and some other document which relate with Qingdao.
Court:	Were together with the book in the box?
A.	Yes."

29. That is one of many passages in the examination-in-chief where questioning appears to have been taken over almost exclusively by the judge.

30. Having regard to what we have already said, we feel that what occurred amounted to a material irregularity. We cannot say that we feel satisfied that there was a fair trial, or that the defendant who was on trial would have felt that he received a fair trial. In those circumstances, having regard to the particular nature of the interventions, we are unable to say that the verdict is safe or satisfactory.

31. Accordingly, with some reluctance, we shall allow the application by D3 for leave to appeal against his conviction and, treating this hearing as the appeal, we shall quash the conviction. We shall hear argument now as to whether or not there ought to be a retrial.

32. [There being no application for a retrial, the Appellant (D3) was discharged.]

Sentence applications - D1 and D2

33. We can turn now to the application for leave to appeal against the sentences imposed on D1 and D2.

34. The trial judge took a starting point of 30 months for the part played by all of the offenders in the scheme. She appears to have made no distinction between any of the defendants so far as starting point is concerned, even though they were not all concerned, as the charges reveal, with the same number of cards. This was a crime devised by D1, and allegedly made possible by D3 who allowed the telephone calling cards to be taken away by D1 from the safe custody of the accounts department. The face value of all the cards stolen on the judge's reckoning was about $1,535,000, although this was very considerably below the actual value because the full number of stolen cards was higher than the judge appears to have recalled. That value represents the value to the company if they had been sold and reflects to some extent the amount of money which would have been received by those who sold them. However, D1 and D2 pleaded guilty to receiving only a part of the total. D1, the salesman, and D3, the accounting manager, needed the assistance of D2 who worked as a computer technician to input the numbers on the stolen cards into the computer, thus enabling the cards to be used by customers who bought them. In the event, the actual loss to the company was $67,500.

35. The judge took into account that D1 and D2 pleaded guilty. She treated them as if they were of good character despite the minor blemish on D1's previous record. She found D2 was less culpable than D1, who had thought up the scheme.

36. In the case of D1, the judge then imposed a sentence of 15 1/2 months' imprisonment. In order to arrive at that total, she approached it by a somewhat unorthodox route which we have not found easy to follow. She gave what she expressed as being a "25 per cent discount" for the plea, reducing the sentence from 30 months to "23 1/2 months as far as my mathematics go". Unfortunately, the arithmetic was wrong and the figure should have been 22 1/2 months. She then gave a further discount of 8 months' imprisonment for the compensation which D1 paid. We regard the overall discount as having been a relatively generous one bearing in mind that the starting point the judge had taken was 30 months, and the effect of her sentence was to reduce it by almost half. We are not able to understand why, in the absence of reasons, D1 did not simply qualify for the full one-third discount for his plea. To that extent, the learned judge was wrong in principle. However, the result is that the judge did give to D1 a sentence which we feel reflects the true justice of the case, and we cannot agree with Mr. Kwok that the sentence, which began at a starting point of 30 months, was in anyway wrong in principle. This was a mean offence. It had been devised by D1 at a time when the man in charge of the company had just died, and it was taking advantage from a position of trust on a scale which was serious and which we feel fully merits the starting point the judge adopted.

37. In the case of D1, we shall refuse his application for leave to appeal against sentence and his application is dismissed.

38. In the case of D2, he was sentenced to 13 1/2 months' imprisonment. The judge noted that he had played a less culpable role than the parts played by the other defendants. In his case, he had also made repayment to the company. No doubt this accounts for the very large discount that was made from a starting point of 30 months. However, we feel that the judge failed to consider his position in the light of his plea to handling a very small number of the cards stolen.

39. In our judgment, the starting point in his case should have been one of 18 months' imprisonment. For his plea, this would have been reduced by a third and, taking into account the payment of compensation and the other mitigating factors, we are satisfied that he, too, would have been dealt with more leniently than the simple one-third discount that he would otherwise have received.

40. We shall grant leave in D2's case and, treating this hearing as the hearing of the appeal, the order of this court is that a sentence of nine months' imprisonment should be substituted for that of 13 1/2 months. To that extent the appeal is allowed.