R. v. YEUNG CHONG YU

IN THE COURT OF APPEAL

1994, No.592

(Criminal)

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J U D G M E N T

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Power, V.-P.(giving the judgment of the Court):

1. The applicant faced 12 charges of obtaining property, namely denim cloth, by deception. The offences occurred between 11th and 31st December 1992. The facts revealed that cloth was obtained by purchasing it using post-dated cheques. It was the Crown case that at the time these were issued there was never any intention to meet them. As the charges are almost identical except for the dates and amounts involved we set out the particulars of only one. The 1st charge alleges that the applicant, together with Choi Loi-fat on about 11th December, dishonestly obtained from Tsui Ngan-sang 14,622 yards of denim with the intention of permanently depriving Tsui thereof by deception, that is by falsely representing that a cheque no.865342, in the sum of $232,489 drawn on the account of Wilson Company at the Standard Chartered Bank and dated 11th January 1993, would be a good and valid order for the said sum if presented on or after the date thereon.

2. The matters were tried before Deputy Judge Leung. The applicant was found guilty on each charge and on each was sentenced to imprisonment for three years, the sentences being ordered to be served concurrently.

3. It was the Crown case that the Wilson company, which was managed by the applicant, issued purchase orders, five being for batches of denim from a company called Ngan Hung and five being for batches of denim from another company called Jentex. They were paid for by post-dated cheques, all of which were subsequently dishonoured. In each case Wilson took delivery of the goods. The Ngan Hung goods described in counts 1 and 2 were, on Wilson's instructions, stored in the King Wah Warehouse. The goods in counts 3, 4 and 5 were on Wilson's instructions sent to No.4 Safety Godown. In the case of the Jentex goods Wilson took delivery but there was no evidence to show where they went.

4. The real matter for decision was whether the applicant was the responsible person in Wilson and whether he knew at all times that the cheques being issued were never going to be met.

5. The applicant gave no evidence but had put forward as defence that he was not the boss or proprietor, but was an underlying and that a Mr. Tsoi, who was, it seems, in China, was the person in charge of the company.

6. Wilson commenced business on 13th August 1992 and ceased to operate on 5th January 1993. It was an admitted fact that a Mr. Tsoi obtained the business registration, that he opened the account with the Standard Chartered Bank, that he was the sole signatory and that he had signed all of the cheques. It was also an agreed fact that he leased office premises at 1214 Nan Fung Centre which were occupied by Wilson Company for a period of two years.

7. Miss Lai Kit-yu, a clerk at Wilson Company, whose evidence is of particular significance said that the applicant and Mr. Lau Kin-keung, also known as Mr. Kent Lau, who she described as the sales manager, ran the company. Her evidence, which was not contested, was

"There was a Mr. Yeung Ka-lun who was the manager. He was the person in-charge, something like manager. Mr. Yeung occupied the room, like Manager Office."

She later said:

"He did the role of manager. There was a Mr. Lau Kin Keung, who should be Sales Manager."

She said that she was told that there was a "boss" in the Mainland. We think it appropriate to note at the very outset that there was no evidence from any source as to the physical presence of this "boss" on the premises at any relevant time during the operation of Wilson.

8. The first witness at trial was PW1, the owner of Ngan Fung. He said that he had been introduced by Mr. Kent Lau to the applicant. He said that discussions took place as to the purchase of denim and that purchase orders were signed and that, in all, he entered into 11 transactions with Wilson, 9 of which involved post-dated cheques.

9. PW13, the manager of Jentex. He told of meeting the applicant and Mr. Kent Lau and of changing name cards and he said that the applicant had said to him: "I am the boss of company and I am person in charge." The applicant, he told the court, had inspected the Jentex's warehouse and purchase orders then followed. There were 10 transactions. Three of these were paid for but seven were not. Post-dated cheques were given which, in the outcome, were not met. Five of those were the subject of charges 6 to 10.

10. The trial judge was satisfied that PW1 and PW13 had gained a clear impression from their dealings with the applicant that they were dealing with the person who was in charge of Wilson. He said:

"Whether with Lau or not, what Defendant had done was that he negotiated the deals with PW1 and PW13. He signed all the Purchase Orders. He gave the cheques, honoured or dishonoured, to the two victims. he persuaded them to accept post-dated cheques. On these facts I find that Defendant obtained the property in question. I am prepared to go further to hold that Defendant obtained property together with Choi because property was obtained in the name of Wilson and all cheques were presigned by Choi.

I also find that Defendant was involved in taking delivery of the goods. Although witnesses who transported, delivered or stored the goods could no longer recognise Defendant, they spoke of a man with stutter (characteristic of Defendant), or Yeung and Lau as contact persons of Wilson being involved in the process. This evidence by itself is flimsy and tenuous but if it is taken together with the small business set-up of Wilson, the conclusion is apparent. In fact, given the position of Defendant in Wilson, there was nothing wrong or sinister in his involving in taking delivery of the goods ordered by him. The important question is whether he obtained the property by deception.

Regarding the transactions with PW1 and PW13, Defendant had issued no less than ten post-dated cheques which were subsequently not honoured. Defendant's representations to PW1 and PW13 were that in the ordinary course these cheques would be met and Defendant intended to pay in sufficient funds to meet them or believed that the account would be in fund to meet them, and these turned out to be false. These were deceptions."

The judge then referred to the transaction tables to which I do not need to refer. He went on:

"A few cheques were honoured only because sufficient deposits were put in just in time to meet them. Some cheques, including those issued to PW1 for the first two transactions, were only honoured upon second presentation by which time the account was sufficiently in fund. Some were dishonoured I find Defendant obtained the goods in question by deceptions, and those deceptions were effective on the two victims PW1 and PW13 in delivering the goods to Defendant. The first few payments were only confidence tricks."

11. The goods obtained from PW1 were sold on to the Cheung Hing Trading Company ("Cheung Hing"). They had been stored, as I have already said, in the King Wah Warehouse and the No.4 Safety Godown. All the goods that had been in King Wah were withdrawn on 31st December and 4th January and the goods in No.4 Safety Godown were withdrawn on 5th and 6th January on the strength of delivery orders which were signed by Mr. Tsoi. The goods were sold for $11.50 per yard on a cash basis. The price list which were given to Mr. Tsui of Cheung Hing was in fact, the packing list supplied by PW1 from which the heading had been removed. Mr. Tsui stated that he bought the goods at $11.50 a yard knowing that the price should have been between $13 and $14. The purchase price paid by Wilson was $16 per yard. Mr. Tsui said that he could not recognize the defendant as the Mr. Yeung with whom he had dealt when purchasing the goods but the trial judge was, in spite of this evidence, satisfied that the Mr. Yeung with whom Mr. Tsui had dealt was in fact the applicant. This finding, with which we will shortly deal, is one of the principal grounds of appeal.

12. The judge said in this regard:

"He did not appear to the Court to be frank when he said he could not recognise Mr. Yeung. He had seen him many times. Shortly before he was interviewed by police regarding this case he met Mr. Yeung in racecourse. He asked him what was wrong with the goods and Yeung said 'It has nothing wrong.' If he could recognise Yeung in a chance meeting, it was strange he could not recognise him not long afterwards in an identification parade. However looking at the evidence as a whole, I find that that Mr. Yeung was Defendant."

13. We turn now to the grounds of appeal.

14. There have been voluminous grounds filed, many of which deal with discrepancies in the evidence which, it is suggested, the trial judge failed to resolve. These were essentially matters for the trial judge and in the outcome Mr. Wong has argued only two grounds. As to the grounds not argued we say only that we are satisfied that there was nothing material therein as they dealt with discrepancies of the sort that inevitably occur in evidence when a number of persons detail business transactions that have occurred at some time in the past.

15. We turn to the two grounds which Mr. Wong did argue. Firstly he suggested that there was a material discrepancy between the evidence of PW3 and PW12 as to the speech defect of the applicant and that the trial judge had, failing to appreciate the significance of that matter, erred by relying, at least in part, on this evidence, when he found, as I have just indicated, that the Mr. Yeung who dealt with PW12 was in fact the defendant.

16. The second matter argued, and it was one which Mr. Wong submitted was the real question before the court in this appeal, was whether when the cheques were handed over, there was evidence sufficient to establish that the applicant knew that they would not be honoured. Whether there was, to put it another way, evidence to establish that he had recklessly or dishonestly handed over the cheques knowing that there would never be funds in the bank to meet them on the due date.

17. We turn to the first matter. The evidence of PW3 Miss Lai Kit-yu was that the applicant had a speech defect. We have allowed an affidavit to be filed to show what appears to have been a correction in the record. The record, as corrected, shows that she agreed with the suggestion that it was a lisp from which the applicant suffered when speaking. Mr. Tsui said that the person who dealt with him under the name Yeung had a stutter. It is suggested that this should have alerted the judge to the likelihood that the person Yeung who dealt with Mr. Tsui was not in fact the applicant and that the trial judge, putting this together with the evidence of PW12 that Yeung was not the applicant, was wrong to conclude that the applicant and Yeung were one and the same person.

18. Mr. Kripas, who appeared for the Crown, suggested that there was sufficient evidence for the judge to come to that conclusion even though Mr. Tsui was saying that the Yeung in the dock was not the person with whom he dealt. Mr. Kripas points that the name used was Yeung, that the applicant whose name was Yeung was the manager of Wilson; that the applicant had a speech impediment of some sort; that the applicant had access to the business records of the company, to the goods being held by the company and, more importantly, to the packing list which had come to the office of the company from PW1. He submits that, when all of these matters were put together the trial judge was entitled to come to the conclusion to which he came.

19. We are in some doubt as to whether those matters would have been sufficient to allow the judge to come, beyond reasonable doubt, to that conclusion. We do not, however, consider that this in any way affects the propriety of his eventual decision. Whatever the facts as to the identity of the person who contacted Mr. Tsui; there can be no doubt that the applicant was the person in charge of the office, that the goods were under his control, that they could not have been taken away to be sold without his permission, and that he was the person to whom account must properly have been made after their sale. In those circumstances, the fact that he was not identified positively as the person who made the actual sale seems to us to be of no moment.

20. We turn then to the second ground, and that is that there was no sufficient evidence to warrant the conclusion the applicant was acting dishonestly when he handed over the cheques.

21. The trial judge made the following finding at the conclusion of his judgment. He said:

"This case is in fact full of trappings of dishonesty and could not be a case of overtrading. They include the short life of the company, the bad financial position the bank account had shown, the high frequency the goods were ordered, the substantial amount the post-dated cheques had covered, and the confidence tricks by which the victims were induced to accept post-dated cheques. When they are viewed together, I am satisfied beyond reasonable doubt that according to the ordinary standard of reasonable and honest people, what was done by Defendant in the name of Wilson was dishonest and Defendant did realize that reasonable and honest people regard what he did as dishonest. I find Defendant guilty of all ten charges."

There was, in our view, ample evidence to allow the judge to come to that conclusion. As we have indicated, the defendant gave no evidence. There was no evidence of any sort to establish that anyone other than the applicant was in control of the Wilson Company. The shadowy "boss" of the company, as far as the evidence goes, never made any appearance at any time during the life of the company. The conclusion to which the judge came that this was a deliberate fraud from the outset is one wholly justified by the evidence.

22. The application for leave to appeal against conviction is refused.