HKSAR v. NG KI WAI

CACC 393/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 393 OF 1999

(ON APPEAL FROM DCCC 300/1999)

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J U D G M E N T

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Hon Mayo JA (giving the judgment of the Court):

1. The applicant was convicted on fifteen counts of theft after a trial in the District Court before Deputy Judge Tong Man. He was sentenced to a total of 3 years imprisonment. He now seeks leave to appeal against his convictions and the sentences which were imposed.

2. The applicant was employed as the head of the accounting department of a company called Hsin Ten Enterprises (HK) Limited. He joined the company in 1997.

3. Altogether there were eleven prosecution witnesses.

4. PW1 the vice-president of the company gave evidence concerning the general background to the situation. The company's accounts were maintained by a network of three computers. One was operated by the applicant and the other two by two office girls who worked for the applicant.

5. The fifteen counts can conveniently be divided into four categories. 1. Misappropriation of cash cheques; 2. Misappropriation of two loans; 3. Misappropriation of tour fees; and 4. The shortfall which was found when an audit was conducted after the applicant ceased to be Chief Accountant.

6. On the first category evidence was given concerning the procedure adopted when the company issued cheques to third parties. The applicant would draw up a voucher providing details of the payment in question together with a completed cheque save for the authorised signature. These would be tendered to PW1 or PW2 for signature if approved. It is noteworthy to add that a large measure of trust was reposed in the applicant and that on occasion when PW1 anticipated being away from Hong Kong cheques were signed in blank.

7. This category included the thefts charged in counts 1 to 10. The total amount involved was well in excess of $600,000.

8. The judge's Reasons for Verdict run to 18 pages.

9. In them he gives particulars of the evidence relating to the counts in some detail. It has to be said that there was overwhelming evidence that each of the counts had been proved up to the hilt.

10. The second category related to the loans which had been made to PW2. The first loan was for $536,844. These moneys had been advanced to PW2 to enable him to fund a new branch office of the company in the Mainland. The second loan was for $24,486. This was to assist PW2 in paying tax. PW2 gave evidence concerning the repayment of these loans to the applicant. There was no record of the repayments in the company's records.

11. The third category related to an incentive scheme the company had with its distributors. If various sales targets could be achieved the distributors were allotted points entitling them to take part in tours organised and paid for by the company. There were also facilities for distributors who had just failed to meet the targets to "top up" their points by payment in cash.

12. PW6 gave evidence of giving $64,837 in cash to the applicant in respect of this scheme and PW4 of giving to him $51,612. Neither payment was recorded in the company's books.

13. The final category is self-explanatory. After the audit was conducted $131,367 was found to be unaccounted for.

14. The applicant gave evidence in his defence. He was unable to provide any convincing explanation for the case which had been made out against him. The best he could do was to try and put it all down to malfunctions in the computer system. His brother also gave evidence on his behalf. This was basically confined to a character reference and in particular evidence that the applicant didn't have any bad or expensive life style habits.

15. The judge gave cogent and compelling reasons for accepting the testimony of the prosecution witnesses and rejecting the applicant's evidence.

16. In his homemade grounds of appeal the applicant complains that:

"- The judge did not see the points of doubt (benefits of which should) be accrued to him.

- The judge was subjective in his (verdict).

- The witness could not have given to him the banknote that was marked exhibit.

- The taking of cash by the witness was (indicated) at the back of the cheque.

- The computer system was faulty and could not record properly.

- No accountant was engaged to perform an audit."

17. Before us the applicant elaborated on these grounds. He claimed that he was innocent. He said that the trial judge had believed all of the prosecution witnesses and disbelieved him. He also claimed that the judge was prejudiced against him. He didn't consider his intentions and that he had not had any great need for money at that time. He also claimed that the judge had not taken into account the fact that he held strong religious beliefs. He said that PW1 and PW2 had been friends for a number of years. The judge had not taken cognizance of this when considering their evidence.

18. So far as the loans were concerned he said that it was unlikely that the payment would have been made in cash due to the fact the amount involved was over $500,000. He said that as PW2 was the only witness to give evidence in this connection, it was unreasonable for the judge to accept this testimony. He also claimed that the prosecution witnesses as a whole did have reason to implicate him. He could readily be made out as being a scapegoat. He also said that in addition to the three computers which had been referred to by the judge in his Reasons for Verdict there were altogether seven other computers. His subordinates had access to these computers and that being the case the system was not completely under his control. The records could have been interfered with.

19. So far as the tour fees were concerned. It was significant that only two amounts had been misappropriated. Had he in fact been dishonest he could have misappropriated many other payments.

20. He finally said that on occasion commissions were paid to distributors. As these were paid out of petty cash this might provide an explanation for the missing funds. Overall the accounting system was chaotic.

21. The matters which have been raised by the applicant do not begin to cast any doubts upon the correctness of the conclusions drawn by the judge. There are no grounds for interfering with these convictions. The application for leave to appeal against convictions is refused.

22. So far as the application for leave to appeal against sentences is concerned the applicant put forward the following grounds:

1. He claimed that the judge had not considered the letter which had been written by Father Joseph Fan the priest of the church concerning his character.

2. He also referred to the fact that he had no criminal record.

3. He also referred to his father having suffered from severe illness from which unfortunately he has now died.

4. He also claimed that the family background report which had been obtained by the judge had not been properly considered.

23. When passing sentence the judge made these observations:

"There are altogether 15 offences. In respect of the whole amount, I think an appropriate starting point for the punishment you are going to receive should be in the region of 3 1/2 years.

You have a clear record but I am afraid your clear record cannot help you much because defendants who have been convicted of similar sorts of offences are almost invariably of clear record.

I have also considered the content of the probation officer's report and the letter submitted by the church. Obviously, you have been well-trusted throughout the years by your friends, your relatives and, of course, including your employer. But as I have said, this will not help you too much. The fault is all yours, you have abused all those trusts.

Anyway, I will allow a 6 months' discount from your total terms because of the fact that you have a clear record.

Having considered all these factors, I now sentence you in the following ways:

From charge 1 to charge 10, that is to say all charges concerning cheques, you shall go to prison for 2 years for each of those charges.

For charge 11, the amount involved is something around $500,000, you should go to prison for 3 1/2 years. However, for this offence, I allow you, as I have said, 6 months' discount for your clear record. So the end result is you have to go to prison for 3 years for this charge.

For charges 12 and 13, 2 years each.

Charge 15, 2 1/2 years.

All terms shall run concurrently amongst one another, so you shall go to prison for a total period of 3 years."

24. The judge also passed a concurrent sentence of 2 years on the 14th charge. The total amount involved was approximately $1.5 million. As is so often the case in these types of situation a large measure of trust was reposed in the applicant.

25. Having regard to this and the amounts involved it can fairly be said that the sentences which were imposed were extremely lenient. There is no merit whatever in either of these applications and they are dismissed. We order that 3 months of the time which the applicant has spent in custody will not count towards his sentence.