WU WING FU AND OTHERS v. THE QUEEN

-----------------------

H E A D N O T E

-----------------------

GAMBLING ORDINANCE CAP. 148 S.6 GAMBLING IN A GAMBLING ESTABLISHMENT Proof of "gambling establishment" may be achieved by proof of one or more transactions of unlawful ambling in the premises on one or more occasions and does not depend on proof that the game the defendants were partaking in was unlawful per se.

Once presumptions in section 19(1) and (2) arise they are prima facie proof that the subject matter premises are a gambling establishment and that persons found therein were gambling therein.

There is no additional burden on the Crown to prove knowledge by the defendants that the premises are a gambling establishment or to prove that the game the defendants were playing was unlawful per se. All gambling in a gambling establishment is unlawful and a game which falls within the exceptions in S.3(3)-(4) does not become lawful if it is taking place within a gambling establishment.

Query whether knowledge that the premises is a gambling establishment is a necessary ingredient to an offence under section 6 and whether a defendant can rebut the presumption by proving, he did not know it was a gambling establishment.

On the facts of the case the magistrate was justified in holding, that the presumptions had not been rebutted whether knowledge was a necessary ingredient or not.

IN THE SUPREME COURT OF HONG KONG

Appellate Jurisdiction

Magistracy Appeal No. 518 of 1989

Date of delivery of judgment: 17 July 1989

-----------------------

J U D G M E N T

-----------------------

1. On the 3rd October 1988, a police raid was conducted at the premises of High Energy Development Co. Ltd. at 1st Floor, 327 Ngau Tau Kok Road, Kowloon, the police being armed with a gambling authorisation. These premises were divided into two parts one of which provided restaurant facilities although no restaurant licence had been obtained. The other of which provided a number of small rooms for the purpose of playing mahjong. There were signs which indicated a restaurant and a mahjong club or association at the entrance. As a result of enquiries the police found the club vas registered as a club under the Societies Ordinance. As a result of this raid a large number of people were charged with various offences under the Gambling Ordinance, Cap. 148, relating, to (a) operating a gambling establishment (D1, D2, D45, D46 and D47), (b) managing a gambling establishment (D3), and (c) gambling in a gambling establishment (D5 - D44).

2. The (a) and (b) charges were contested. However, many of the defendants charged on the (c) charge pleaded guilty to the charge and were duly fined. Among those who disputed this charge were the appellants (D21, D22, D23 and D24) and other defendants, namely D33, D34 and D35.

3. At the trial, the appellants were represented by Mr Lawrence K.Y. Lo, Solicitor Foo & Li, while D1, D2, D3, D33 - D35 and D45 - D47 were represented by Mr Peter C.T. Lee, Barrister instructed by Sammy S. Lee & Co.

4. At a previous hearing on the 20th November, Mr Lo for the appellants, had indicated that his clients did not realize the premises were a gambling establishment. Mr Sammy Lee indicated that his clients contended that the premises were a private member's club and that the gamblers said that it was a social occasion.

5. The trial commenced before Mr Candy on the 19th January, 1989 and went on for some four days until the 24th January, 1989 when judgment was postponed until the 15th March 1989. On the latter day, D1, D45, D46 were convicted on the (A) charge D3 was convicted on the (B) charge and the appellants, D21, D22, D23 and D24 and the other defendants, D33 to D35, were all convicted on the (C) charge.

6. On the very same day, D1, D45 and D46 and the four appellants filed notice of appeal against conviction on their respective charges. On the 22nd March 1989, D33 also filed a notice of appeal against conviction on the (C) charge. However on the 20th June 1989, D1, D33, D34, D45 and D46 filed notices to abandon their appeals, with the result that this appeal has proceeded with only the 4 appellants D21, D22, D23 and D24 now disputing their convictions in respect of the offence of gambling in a gambling establishment.

Their perfected grounds of appeal are as follows:-

"1. That the Learned Magistrate failed to give any "or any sufficient weight to the circumstancial evidence of entrances, connecting doors and signposts that were likely to lead the appellants to believe that the area where they played mahjong was part of a restaurant

2. The Learned Magistrate did not give any or any sufficient weight to the evidence of the Appellants. In particular he failed to consider their good character, responsible positions that they were present primarily to eat a meal and that the mahjong game was a social pastime not intended to profit any other person at their expense.

3. The Learned Magistrate erred in concluding that the appellants went to the premises primarily to gamble. Further or in the alternative he failed to give any reasons why he rejected their evidence to the contrary.

4. The Learned Magistrate erred in concluding that there was no registration of any club or society relating to the premises or any Association or society which would have been exempt from registration.

5. The Learned Magistrate failed to direct himself properly on the burden of proof relating to knowledge in the minds of the appellants that the premises were a gambling establishment.

In all the circumstances the convictions were unsafe and unsatisfactory, and against the weight of the evidence."

7. The main thrust of the appeal appears to echo the words of Mr Lo at the outset that the appellants were lacking mens rea in that they were unaware that the premises were a gambling establishment and also that their conduct in the premises was not unlawful in that it fell within the exceptions provided in s.3(3) & (4) of the Gambling Ordinance.

8. Grounds 1 & 5 both relate to mens rea and it will be convenient for me to deal with these two grounds together. Similarly Grounds 2, 3 & 4 relate primarily to the question of the lawfulness of their conduct. However, in view of the fact that it had been conceded at the trial that the prosecution evidence was sufficient to raise the presumptions under section 19(1) & (2), the convention in Ground 2 that the magistrate did not give any or any sufficient weight to the evidence of the appellants goes further that the issue of the lawfulness of their conduct within the premises and goes to the wider question of whether the magistrate canoe properly criticised holding that the appellants had not rebutted the presumptions.

Mens Rea

9. It is Mr Laskey's argument in support of Ground 5 that when a defendant is charged under section 6 of the Gambling Ordinance, the presumptions are of limited assistance to the Crown, who need in addition to prove beyond reasonable doubt that the defendant realised that the premises were a gambling establishment. He relies on Ground 1 to argue that the appellants were likely to believe otherwise.

10. Mr Kilgour argues that as the presumptions arose, they were sufficient to support a conviction under this section unless the contrary were proved and that the burden of proving the contrary was on the appellants. He also contends that in any event on the evidence it was reasonable for the magistrate to reach the conclusion he did.

11. It is, perhaps, convenient at this stage to look at the sections concerned.

12. Section 6 (under which the charge against the appellants was brought) provides:-

"Any person who gambles in a gambling establishment commits an offence …. and is liable on conviction to a fine of $10,000 and to imprisonment for 3 months."

The presumptions arose under s.19 which provides :-

"19(1) Where in any proceedings under this Ordinance it is proved that -

(c)    gambling equipment was found in any premises or place entered under section 23(2)(a) or on any person found in any such premises or place,

it shall be presumed until the contrary is proved that the premises or place are or is a gambling establishment.

(2) Where in any proceedings under s.6 it is proved that a person was found in a gambling establishment or that a person escaped from a gambling establishment on the occasion of its being entered under section 23(2)(a), such person shall until the contrary is proved be presumed to have been gambling therein."

13. It would appear from the terms of section (6) that there are two essential, ingredients to an offence under this section which the prosecution must prove (1) that the premises were a gambling establishment and (2) that the defendants were gambling therein. Furthermore, it would appear from the terms of section 19(1) and (2) that the presumptions, unless rebutted, would he sufficient to establish both these ingredients.

14. Mr Laskey however contends that an additional ingredient of knowledge that the premises were, a gambling establishment must be proved independently of the presumptions. In this respect he relies on the judgment of Rhind, J. in Yuen Chi Ming & Others v. R. Criminal Appeal No. 214/81 who at page 7 commented upon the presumption in subsection (1) as follows :-

"For the purpose of proving a charge contrary to either section 5 or section 15 of the Ordinance, this presumption is, however of limited utility. Through the presumption, the essential ingredient of the premises in fact being a gambling establishment can be established the presumption does nothing, though, to prove that a defendant knew that the premises were a gambling establishment. That the defendant must have known that the premises were 'a gambling establishment' is not open to dispute, and it is up to the prosecution to prove that he had such knowledge. How the prosecution proves knowledge is a trite topic in the criminal law."

15. Although Rhind, J. was dealing with a case under different sections Wong, J. In the Queen v. Fong Chi Keung & Others [1988]1 HKLR 126 at 128 applied the same principle in respect of an offence under section 6 of the Ordinance. He said :

"I accept that the offence created by s.6 of the Gambling Ordinance is one that also requires mens rea, a point which Mr Reading for the Crown readily conceded. Knowledge is a matter to be inferred from all the evidence and without dwelling more on this issue there is in my view, ample evidence to draw the inference that the appellants knew that the premises were a gambling establishment."

16. The submission in Fong's case which was accepted by Wong, J. was commented upon in the Court of Appeal in the Queen & Kwong Yin Hunt Magistracy Appeal No. 1048 of 1987 as follows:

It was conceded, in the course of the appellate hearing, that the presumption under section 19(1) arose. But it was submitted that that section went only so far as to help the prosecution establish a prima facie case that the premises were a gambling establishment. It did not assist the prosecution to prove the mens rea of a particular defendant, that is that he knew that the premises were a gambling establishment.

This submission is one which I do not quite follow for it seems to ignore the provisions of section 19(2). The authority upon which counsel there relied - Yuen Chi Ming and others v. the Queen M.C.A. 214 of 1981 - related not to section 6 but to sections 5 and 15 - though the issue in Yuen seems to have been ‘gambling establishment' simpliciter."

17. This would appear to be an unfavourable comment by the Court of Appeal in which they drew a distinction between offences under sections 5 and 15, on the one hand, where such knowledge must be independently established and the offence under section 6, on the other hand, where it does not.

18. In Wong Kar Kui & Others v. The Queen (1982) HKLR 488, Bewley, J. dismissed an appeal by l5 appellants who had been convicted under section 6 of the Ordinance. Although he dealt with the element of knowledge in respect of the other charge under section 5 of the ordinance, he did not refer to it at all when dealing with the convictions under section 6.

19. It has not been submitted to me that section 6 creates a form of strict liability, but it seems to me to be arguable that it does. The section is aimed at conduct which appears to fall within the propositions set out in the speech of Lord Scarman in Gammon (Hong Kong) Limited and Others Others v. A.G. of Hong Kong (1984) 2 ALL ER 503. at 508E and followed in Hong Kong by the Court of Appeal in the A.G. v. Yip Man-cheong Magistracy Appeal No. 1753 of 1988.

20. However, as strict lability is not a matter which has been raised in this appeal I do not propose to say more except that I am satisfied that the presumptions once raised are prima facie proof of the offence under section 6 and that there is no burden on the Crown to establish mens rea independently of the presumption. In my judgment Ground 5, therefore, fails.

21. So far as the circumstancial evidence in Ground 1 is concerned I am bound to say looking at the evidence as a whole including the photographs and the evidence of the police officers who went to the premises that night that if anything the circumstantial evidence favoured the prosecution.

22. There is, therefore, nothing in Ground 1.

23. Mr Laskey suggests that an offence was not committed under s.6 if the game in which the appellants partook, was not unlawful in itself. Whilst at one stage of his submission, he suggested that the gambling by the defendants would be unlawful if it took place in a gambling establishment of which the defendants were aware, he later submitted that the appellants would have a defence if they could establish that the game which they were playing was not unlawful within the meaning of s.3 of the Gambling Ordinance.

S.3 provides :-

"3.(1) Save as provided in subsections (2), (3), (4), (5), (6), (7) and (8) gambling is unlawful."

24. I do not propose to set out all the subsections because only subsections (3) and (4) are relied upon in this appeal on behalf of the appellants. Subsection (3) provides :-

"(3) Gaming is lawful if the game is one in which dice, dominoes, mahjong or tin kau tiles, or playing cards are used and -

(a) the game is played on a social occasion in -

(i) premises licensed as a restaurant under the Public Health and Municipal Services Ordinance;

(ii) premises where intoxicating liquor is sold pursuant to a licence or other, authorization granted under any Oridnance; or

(iii) premises occupied or used by a society which is registered or exempted from registration under the Societies Ordinance;

(b) a fee is not charged for admission to such premises;

(c) the game does not involve playing against a bank kept by one or more of the players exclusively of the others; and

(d) the game is not promoted or conducted by way of trade, or business, or for the private gain of any person otherwise than to the extent of a person's winnings as A player of or at the game."

Subsection (4) provides

"(4) Gaming is lawful if the game is one in which mahjong or tin kau tiles are used and -

(a) it is played in premises -

(i) licensed as a restaurant under the" Public Health and Municipal Services Ordinance^; or

(ii) occupied d or used by society which is registered or exempted from registration under the Societies Ordinance;

(b) a fee is not charged for admission to the premises;

(c) the game does not involve playing against a hank kept by one or more of the players exclusively of the others;

(d) the game is not promoted or conducted by way of trade or business in the premises, otherwise than to the extent of the charging of a fee not exceeding the prescribed amount for the hire of any set of tiles, or for the private gain of any person otherwise than to the extent of a person's winnings as a player of or at the game."

25. It is Mr Laskey's contention that if the defendants can bring themselves within either exception in. Subsection (3) or subsection (4), they are entitled to be acquitted.

26. Mr Kilgour argues that as a fee was charged to the police officers beyond the prescribed fee and as the photographs of the premises showed they were set up for the playing of mahjong, the appellants could not bring themselves within either of the exceptions in subsection (3) or (4) and that the error referred to in Ground 4 could make no difference to the Magistrate's decision.

27. It had been argued be ore Wong, J. in Fong's case referred to above that it was encunbent on the prosecution to prove independently of the presumptions that the gambling was unlawful. This contention was based upon "an argument that the Ordinance created two types of gambling, lawful gambling and unlawful gambling and that by necessary implication, section 18 of the Ordinance placed the burden of proof on the prosecution to prove that the gambling was unlawful.

28. This argument was rejected by Wong J. in the following passage :

"Section 18 has absolutely no relevance. This section reads :

'In any proceedings for an offence under ss. 5,7,9 or 10 the burden of proving that any gambling was lawful by virtue of s.3 ..... shall be on a defendant.'

It was submitted by Mr Nguyen that because of the omission of any reference to s.6 in this provision, the legislature must have, by necessary implication, placed the burden on the prosecution to prove that the gambling was unlawful in a charge brought under s.6. I am unable to accept this argument which was utterly misconceived. Once it has been proved either by positive evidence or by presumptions under s.19, which remains unrebutted, that a person gambles in a gambling establishment, an offence under s.6 is established. I see nothing illogical or inconsistent in the omission of s.6 in s.18 because the simple answer is that you do not have lawful gambling in a gambling establishment. To say that there can be lawful gambling in a gambling establishment is not only a contradiction in terms but also the worst absurdity and a complete defeat of the legislative intention. In my judgment, the correct and only sensible interpretation is that any ambling in a gambling establishment is unlawful."

29. I most respectfully agree with that passage in its entirety.

30. The Court of Appeal in Kwong Yin Hung's case were of the opinion that Wong, J. rightly rejected the submission in relation to the burden of proof as to the unlawfulness of the defendant's conduct. However, there is a passage in the judgment which indicates that IF the game played by the gamblers falls within the exception in section 3(2) then the players have a defence to a charge under section 6. Silke, V.-P., in the course of the judgment at p.9 said :

"In my judgment, the true position is that the exception in section 3(2) provides a defence to a charge under section 6 the prima facie proof of which emerges from the presumptions contained in sub-sections (1) and (2) of section 19. If the defendants can, or if the evidence of the prosecution itself is such to, rebut the presumptions then the gambling becomes lawful and the premises cease to be a gambling establishment. Once the presumptions come in to play then the burden, on the more likely than not basis, is placed upon the person charged. If this is what Wong, J. was saying in Fong M.C.A. 605/1987, when he stated that no gambling is lawful if it takes place in a gambling establishment then Fong was rightly decided."

31. Now it is clear that on the facts in Kwong Yiu Hung's case the learned Vice-President was dealing with case where the only activity in the premises concerned, was that of only one group and related to only one occasion. The position would appear to have been similar in Fong's case, for, although D6 in that case had given evidence that he and his fellow appellants had been playing mahjong in a small room which was not the "East Room", where the activity complained of had been going on, he had not been believed. I think the ratio decidendi of the judgment of the Court of Appeal must be limited to the situation where the evidence shows only one unlawful activity by one group on one occasion.

32. In my view the proof of the gambling establishment, does not necessarily depend upon the particular activity in respect of which the defendants are charged.

33. Evidence may he led in respect of visits by the police to the premises on a number of occasions with a view to establishing that the premises are a gambling establishment. If that evidence satisfies the Court that the premises are "opened, kept or used, whether on one occasion or more than one occasion, for the purposes of or in connection with unlawful gambling the premises are a gambling establishment. The fact that a gambling establishment may be proved by proof of the activity on only one occasion does not alter the situation that it may be proved by the activities of a large number of different groups on different occasions.

34. One must therefore make a distinction between the unlawful gambling which is an essential ingredient to prove the gambling establishment, from the gambling which the defendants are partaking in when charged under section 6. It is the unlawful gambling on the one or more occasions that makes the premises a gambling establishment, not necessarily the gambling indulged in by the defendants on the one occasion. Whilst proof of a gambling establishment may depend on proof of a number of different games being unlawful games on more than one occasion, the exceptions in subsections (3) and (4) of section 3 focus on individual games.

35. A distinction can be drawn between an offence under section 6 and an offence under section 13 of the Gambling Ordinance. While section 6 covers gambling in a gambling establishment, section 13 covers gambling in any other place whatsoever not being a gambling establishment, and whether or not the public have or are permitted to have access thereto, or in any street. It provides in subsection (2) "any person who gambles unlawfully in any such place or in any street commits an offence and is liable on conviction to a fine of $10,000 and to imprisonment for three months."

36. It is clear that the gambling, under section 13 must be unlawful per se. However, the word "unlawfully" does not appear in section 6. The unlawfulness of the defendants’ acts under section 6 is constituted by their gambling in a gambling establishment, i.e. a place opened, kept or used for the  purpose of unlawful gambling.

37. In my judgment, the burden upon the appellants to discharge the presumptions was to establish on a balance of probabilities (1) that the premises were not a gambling establishment. If they were unable to discharge that burden, then they had to prove on a balance of probabilities (2) that they were not gambling therein. It would be no defence for them to say we were gambling but not unlawfully" because as Wong, J. has points out any gambling in a gambling establishment is an offence under section 6.

The magistrate's approach to the evidence.

38. The learned magistrate summed up the evidence for the prosecution in his Statement of Findings as follows :

"The prosecution adduced evidence that several police officers in plain clothes went to premises called Shung King Cheuk Luen Wooi at 327, Ngau Tau Kok road at about 8 p.m. on the date in question. They were greeted by a man at counter just inside the door of the premises and asked if they had come to play mahjong. They replied that they had and were told that the charge was $30 per hour with a 10% discount between Monday and Friday. The group was shown to a room with two tables, one of which was already occupied, and remained playing mahjong for about three hours. During, that period they were served once with glasses of water on leaving they were presented with and paid a bill of $54. They were told that 10% discount had already been given. The person who welcomed the group and who presented the bill and received payment was identified as D3.

Soon afterwards a Police party raided the premises and found forty people playing mahjong at ten tables in various rooms. Gambling equipment was found in the premises and seized."

39. The evidence to which the magistrate was referring was unchalleged in this respect. Most of the cross-examination on behalf of the appellants was conducted with a view to assisting them to establish their claimed lack of knowledge that the premises were a gambling establishment and to assist them to bring themselves within the exceptions in section 3.

40. The evidence of the operators appears on the face of the record to have been highly dubious and not at all convincing to establish that the gaming within the premises was not promoted or conducted by way of trade or business within the meanings of subsection (3)(d) or subsection (4)(d) of section 3.

41. In my view it is arguable that the evidence for the prosecution including the photographs showing the set up of the premises was sufficient in itself to establish that the premises were opened kept or used for the purposes of unlawful gambling and were therefore a gambling establishment even without the aid of the presumption in section 19(1).

42. However that presumption did arise and was sufficient in the absence of credible evidence to the contrary to establish all that had to he established.

43. The evidence of the appellants was not believed by the magistrate and that is hardly suprising for it fitted in with the evidence of the operators who had also been disbelieved. It is true the magistrate's. Statement of Findings in relation to these appellants was sparse to say the least, but I cannot say, not having seen the appellants giving, evidence, that he reached the wrong conclusion on their credibility.

44. In my view the magistrate was perfectly justified in holding that the presumption in section 19(1)(c) had not been rebutted. If knowledge that the premises are a gambling establishment is an essential ingredient to an offence under section 6, section 19(1)(c) was sufficient to establish all the prosecution had to prove, in this respect, and that the appellants knew the premises were a gambling establishment.

45. Once it had been accepted that the presumptions under section 19 arose, it was presumed under subsection (2) that the appellants were gambling therein.

46. There was unchallenged evidence that the appellants were in room 12 and that PC 23055 (PW5) found a set of mahjong tiles was being used, that there were 15 chips in a drawer in front of D21, 62 chips in a drawer in front of D22, 5 in a drawer in front of D23 and 10 in a drawer in front of D24. It was admitted by Mr Lo that the appellants had been playing mahjong there. Although no money was seized, D23, one of the appellants, admitted in evidence that each chip represented $1 but added that as far as he was concerned it was just for fun.

47. It is difficult to see how the magistrate's finding that the appellants were gambling in the premises can be faulted.

48. The magistrate adopted the correct burden and standard of proof. He had ample opportunity to see the appellants giving evidence and he did not believe their evidence or that of the other defence witnesses on which the appellants also relied. There was ample evidence before him to support him in his findings. Although his statement of findings was sparse, especially considering the length of time he took before delivering judgment, I cannot say that he reached the wrong, conclusion or that the convictions are unsafe or unsatisfactory or against the weight of evidence.

49. For these reasons the appeals are dismissed.