HKSAR v. LIU WAI KOON

CACC 213/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO 213 OF 2014

(ON APPEAL FROM DCCC 1014/2013)

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REASONS FOR JUDGMENT

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Hon Pang JA (giving the reasons for judgment of the court):

1.  On 27 May 2014, before Judge Dufton in the District Court, the appellant and his co-accused were convicted after trial of one joint charge of ‘fraud’, contrary to section 16A of the Theft Ordinance, Cap 210. They were both sentenced to 3 years’ imprisonment. On 20 May 2015, the appellant was granted leave by the single judge (McWalters JA) to appeal against his sentence, but not conviction, which application was refused and not renewed. On 7 October 2015, in the appeal proper, we allowed the appellant’s appeal and reduced his 3-year sentence to one of 2 years. These are our reasons.

The Allegation

2.  The allegation, found proved, was that between December 2010 and 18 January 2011, the appellant and his co-accused falsely represented to two prospective buyers that a plot of land in Man Kam To, Sheung Shui was for sale and that the appellant was authorised by the owner of this land to deal with matters in relation to the sale; and that, as a result, the prospective buyers were induced into issuing, in the appellant’s favour, a cheque for $500,000 as deposit for the purchase price of the land. 

Salient Facts

3.  The original owner of the land concerned was a person by the name of Suen Kwai Lin.  He passed away intestate on 24 June 1967.  But it was not until 3 December 2010 that Letters of Administration were granted by the High Court to his son, Suen Fu Wai (“Mr Suen”).  This, Mr Suen had achieved through the help of the appellant, an indigenous inhabitant of the New Territories whom a trusted friend, Kong Sin Tit (“Mr Kong”) had introduced him to for precisely that purpose.  In the same month (December 2010), in engaging the appellant’s help in the further matter of claiming compensation, part of the land having been resumed by government for public usage, Mr Suen signed five to six authorisations authorising the appellant to act on his behalf.  Pre-typed, these authorisations were all made and provided by the appellant, and were absent of any reference to the selling of the land.  Their numbers were explained by the appellant as being necessary for various unspecified follow-up actions.

4.  The appellant’s co-accused (referred to as “D2” by the trial judge[1]) made Mr Suen’s acquaintance in 2009.  He was a licensed estate agent with the property agency, Uni-Power Consultants Limited (“Uni‑Power”).  He met Mr Suen at a tea gathering where the appellant and Mr Kong were both present.  In early 2010, D2 also met Wong Hon Sun (“Mr Wong”) and Ho Yuet Ming (“Mr Ho”) who, upon further contact, expressed an interest in the land in question.  This led to another meeting in December 2010, during which the appellant was introduced by D2 as someone who knew the owner of the land and who was able to act as the owner’s agent in the sale of the land.  To bring the point home, the appellant had produced for Mr Wong and Mr Ho’s benefit an authorisation bearing Mr Suen’s signature (Exhibit P1).  With the exception of the “remarks” section, which authorised the appellant to sell the land, this document was in almost every other aspect identical to the authorisations that Mr Suen had otherwise signed.  The prosecution case, as accepted by the judge, was that this authorisation was forged by adding words into the “remarks” section which Mr Suen had left blank.  It was the prosecution case that Mr Suen had not consented to and was unaware of any land sale.

5.  On 17 January 2011, for an agreed price of $5.2 million, a Provisional Agreement for Sale and Purchase (“PS&P”) was signed in respect of the land.  The signatories were Mr Wong on behalf of Power Place Development Limited (“Power Place”), the company Purchaser through which he and Mr Ho operated; the appellant on behalf of Mr Suen, the Vendor; and D2 on behalf of Uni-Power, the stated Agent for both Vendor and Purchaser.  Mr Ho on behalf of Power Place also signed an agreement to pay a consultant’s fee at “$30 per square foot” to the appellant on successful completion of the purchase, which D2 witnessed.  As a deposit for the purchase, Mr Wong wrote out a cheque in the sum of $500,000.  At the appellant’s assurance that he was authorised to accept payment, Mr Wong made the cheque in favour of the appellant.  Formalities were concluded on the following day (18 January 2011) when D2 returned the “pink copy” of the PS&P to Mr Ho.  By then, forged signatures purporting to be that of Mr Suen had been appended to it.  The deposit, however, never reached Mr Suen.  Mr Suen remained in the dark about the transaction and the sale and purchase failed to complete on its scheduled date of 30 April 2010.

6.  The appellant and D2 gave various excuses for the failure to complete, putting the blame on, amongst other things, an alleged disagreement between Mr Suen and his siblings who now co-owned the land.  In the end, on 30 May 2011, an undertaking was given by the appellant to (a) refund the deposit and (b) pay an equivalent amount of compensation as per clause 8 of the PS&P, totalling $1 million.  When some of the appellant’s cheques became dishonoured, and things did not work out according to plan, the appellant and Mr Ho entered into further negotiations.  Eventually, and with the service of a middleman, a final settlement in the sum of $650,000 was reached on 15 September 2011.  On receipt of the full amount of this money in cash, Mr Wong and Mr Ho were appeased and took no further action in relation to the matter.  In fact, nothing else happened in the case until the ICAC arrested the appellant and D2 on 7 and 11 January 2013, respectively.  It was not revealed in the evidence at trial as to who exactly it was that reported the matter to ICAC.       

The Sentence

7.  The appellant was aged 41 at the time of the offence, 43 at the time of his arrest.  For occupation, he specialised in dealing with land‑related matters in the New Territories for indigenous inhabitants and their relatives.  His more serious previous convictions were from a long time ago and were disregarded by the judge for sentencing purposes.

8.  Insofar as it is relevant, the following is what the judge said in his Reasons for Sentence:

“10. In passing sentence I have carefully considered everything said by Mr Wong on behalf of D1 and by Mr Lam on behalf of D2 together with the letters of mitigation which show both defendants are held in high regard by their local community and that they have served their community as particularised in those letters.

….

15. Mr Lam asks for a suspended sentence. In my view although Mr Wong and Mr Ho ultimately suffered no loss having been refunded the deposit and paid $150,000 compensation and Mr Suen also suffered no loss, this nevertheless remains a very serious fraud.

16. [The appellant] and D2 tried to sell the five lots when they had no authorisation from Mr Suen to do so. After Mr Suen signed the authorisation the remarks were added purporting to authorise [The appellant] to sell the five lots on behalf of Mr Suen. Mr Suen’s signature was forged on the Provisional Agreement for Sale and Purchase.

17. D2 failed in his duty as a sales person to protect and promote the interests of his clients by failing to inform Mr Suen that Mr Wong and Mr Ho wished to buy the five lots and by not revealing the true situation to Mr Wong and Mr Ho.

18. [The appellant] clearly stood to benefit financially, not only from payment of the deposit of $500,000 but also by payment of a consultant fee calculated at $780,000 (see exhibit P3). Whilst there is no evidence how much of this would be given to D2 both defendants playing an important and essential role in the fraud, it is contrary to common sense to suggest D2 would have received nothing. Also Uni-Power was to be paid $52,000 commission by the purchaser.

19. Although the roles were different the fraud may not have been committed without the collaboration of the defendants. I will therefore sentence the defendants in the same way.

20. In my view to reflect the seriousness of the fraud a starting point after trial of 3 years and 6 months imprisonment is appropriate. Taking into account the deposit was refunded and $150,000 compensation paid with no loss suffered by anyone I reduce the sentence by 6 months to 3 years imprisonment.

21. I am satisfied there are no exceptional circumstances warranting suspension of the sentence.  Both defendants are sentenced to 3 years imprisonment.”

Grounds of Appeal

9.  Ms Chong who acted for the appellant criticised the judge for:

(a) adopting a wrong starting point of sentence;

(b) not giving sufficient weight to the restitution made to the victims;

(c) departing from the normal range of sentence in comparable cases; and

(d) not giving sufficient weight to the appellant’s good standing within his local community.

In the result, Ms Chong submitted that the appellant’s sentence of 3 years’ imprisonment was manifestly excessive.

Discussion

10.  In determining this appeal, we do not feel the need to recite the submissions of Ms Chong, nor indeed the counter-submissions of Ms Lo for the respondent.  We think it sufficient to subject the matter to the following short analysis.

11.  Time and again, this Court has pointed out that a strict comparison between cases is often unhelpful in determining the correctness of a particular sentence.  No two cases are completely the same and whilst the range of sentence as shown in a particular selection of past decisions may be supportive of one view, more often than not, there will, at the same time, be another selection of past decisions that goes the other way.

12.  It was correct for Ms Lo to submit, and Ms Chong not to contest, that there was an element of breach of trust in this case.  Admittedly, it was not a breach of the classic kind, in the sense that, by some wrongdoing of the holder of that trust, the giver of that trust was put directly in harm’s way.  But the fact remains that there was a trust relationship between the appellant and Mr Suen, and it was that relationship which enabled the appellant to perpetrate his crime.

13.  This brings into our consideration the guideline case of HKSAR v Cheung Mee Kiu [2006] 4 HKLRD 776.  Under it, for an offence involving a classic breach of trust, a sentence of 2 to 3 years after trial is said to be appropriate for the monetary band of $250,000 to $1 million.  It raises the question whether, for a non-classic breach of trust such as ours, a starting point of 3 years and 6 months’ imprisonment is appropriate for the sum of $500,000.

14.  In most cases, the facts surrounding the offence are the primary determinants of their gravity.  In this regard, it is relevant to note that neither D2 nor the appellant, as it were, sought out their victims.  The evidence as summarised by the judge was as follows[2]:

“15. In 2009 Mr Wong and Mr Ho were interested in buying the five lots but were unable to find or contact the landowner. Towards the end of 2009 and the beginning of 2010 Mr Wong came to know D2, who worked in a property agency. Mr Wong and Mr Ho met D2 a number of times when they expressed their interest in buying the five lots. In cross-examination Mr Wong agreed that at the first meeting D2 did not say he could contact the landowner or that he could assist in the deal.

16. Around December 2010 after D2 said he was able to contact the landowner a meeting was arranged in a restaurant in Fanling.  At the meeting D2 introduced [the appellant] as someone who knew the landowner and was therefore able to act as the agent of the landowner in the sale of the five lots.  [The appellant] showed an authorisation (exhibit P1) purportedly signed by the landowner Mr Suen (PW3) authorising [the appellant] to sell the five lots ….”

15.  The timing of the Fanling meeting, referred to in the passage just quoted, is also worth noting.  It coincided with the Letters of Administration and the appellant’s authorisation to claim compensation from the government.  That is highly suspicious.  But it is not a matter that the judge had dealt with, and it is impossible to conclude on the evidence that the appellant had not obtained his multiple signed authorisations from Mr Suen for an initially innocent purpose (see paragraph 3 above).  What it means is that the forging of Exhibit P1 could be an afterthought, and it cannot be said that the offence was pre-planned.

16.  In his reasons[3], the judge stated that, on top of the $500,000 deposit, the appellant stood to benefit from a consultant’s fee of $780,000.  He stated that Uni-Power also was to be paid a $52,000 commission.  Unless one goes beyond the evidence and lends oneself to the suggestion that, somehow, Mr Suen would give retrospective endorsement to the sale, it is difficult to see how, premised on a successful completion of the sale, these payments might materialise.  If the judge regarded them as an aggravating factor, he had fallen into error.

17.  Our attention is drawn to the restitution in this case.  It comprised (a) a cash sum of $300,000, paid over when the appellant’s cheques in the first compensation plan began to bounce (see paragraph 6 above) and (b) another cash sum of $350,000, paid under the final agreement of 15 September 2011 (ditto).  These payments, outmatching the initial loss by $150,000, took place some 20 months before the involvement of the ICAC and although, from that angle, they resonate more with meeting legal obligations and cover-up, they nevertheless provided an “important alleviation of the victim’s position”[4].  

18.  As Ms Chong correctly conceded, there was no prosecutorial delay in this case.  On the other hand, it remains a fact that some 20 months after the resolution of the matter by commercial means, the appellant found himself caught up in a criminal investigation.

19.  In all the circumstances, we think a starting point of 2 years and 9 months’ imprisonment would have been proper in this case.  For the restitution, a discount of 9 months would have been appropriate.

Conclusion

20.  For the above reasons, we allowed the appellant’s appeal, set aside his sentence of 3 years and substituted it by one of 2 years.

[1] The appellant was “D1”.

[2] Reasons for Verdict, paragraphs 15 and 16.

[3] Reasons for Sentence, paragraph 18.

[4] See, for example, HKSAR v Chiu Peng [2002] 1 HKLRD 185 at paragraph 18 of the judgment.