R. v. LAM TAK MING

IN THE COURT OF APPEAL

1992, No. 113
(Criminal)

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J U D G M E N T

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Penlington J.A.:

1. This is the judgment of the Court.

2. These were applications for leave to appeal against conviction and sentence following trial in the District Court before Judge Lugar-Mawson on a charge of conspiracy to defraud the Director of the Trade Department of the Hong Kong Government in relation to the allocation of textile quotas to a company called Tai Wah. The applicant was jointly charged with his brother, Lam Ho Ming, who was also convicted of this charge and two other charges of obtaining property by deception. He also lodged a notice of appeal against conviction but that has been abandoned.

3. At the conclusion of the hearing of these applications we refused each of them and said we would hand down our reasons later. This we now do.

4. The background to the matter is that the applicant was at all material times a Trade Control Officer with the European Economic Community Textiles Export Controls Branch of the Trade Department, having been seconded there from the Customs and Excise Department. Lam Ho Ming is the brother of the applicant and was the registered proprietor of Tai Wah, a non-incorporated company. He also used the name Eddy Lam. He was the authorised person named in a textiles control registration form filed with the Trade Department in respect of Tai Wah.

5. On the 24th June 1986 Tai Wah applied for an export quota in respect of 50,000 kg (170,000 pieces) of girls' cotton tops, the consignee being stated as: "Order of: Daily Fashion ab Sweden. Consignee: Daily Fashion, 214 Hexley Road, London, U.K." The factory address of Tai Wah was given as "14/F., Block F, 9-11 Cheong Wing Road, Kwai Chung, New Territories". It was said that the factory had been registered with the Trade Department under Factory Registration No. 1624 and the telephone number of the factory was given as NT4982585. The application was approved on the 4th July 1986 by Mr. Woo Ka Wai, a Licensing Officer, on behalf of the Director of Trade.

6. Tai Wah then applied for an export licence in respect of the goods and this was granted on the 1st October 1986 for a declared value of HK$3 million. The export licence was signed "Eddy Lam" on behalf of Tai Wah.

7. Evidence was called by the Crown which showed beyond any doubt whatever that there was no company trading in England called Daily Fashion and there was no such address as 214 Hexley Road, London. There was a Daily Fashion Company in Sweden but a witness from that company denied all knowledge of any order being placed with Tai Wah. It was also clear from evidence given that Factory Registration No. 1624 had been assigned to a company called Viking Plastic Manufactory of 8/F, Flat B. Yick Shiu Industrial Building, 1 San On Street, Tuen Mun. The premises at 14/F, Block F, 9-11 Cheong Wing Road, Kwai Chung was not occupied by any company called Tai Wah and the tenant denied any knowledge whatever of such a company.

8. At the trial both the applicant and Lam Ho Ming were represented by Mr. Cheng Huan Q.C. and it was vigorously contested as to whether there had been any conspiracy to defraud the Director of Trade by either of the two accused. However, at the hearing of this application Mr. Sedgwick Q.C., who now appears for the applicant here, conceded that the evidence was overwhelming that Tai Wah was a totally fictitious company brought into being for the sole purpose of defrauding the Trade Department into issuing an allocation of textile quota. The sole issue was whether the Crown had produced sufficient evidence to show that the applicant was a party to that conspiracy.

9. In the Crown's opening it was stated that evidence would be given by an expert document examiner, Dr. A.J. Nutten, who had compared three documents. One was a photocopy of Tai Wah's export licence dated the 1st October 1986 on which were two signatures "Eddy Lam". The second was a quota authorisation application for Tai Wah dated the 4th July 1986 also with two signatures "Eddy Lam". The third was a letter from Tai Wah Company undated but contained in the Trade Department's file and it bore the signature "Lam Ho Ming". Dr. Nutten had compared these documents with a control document which was admitted to have been written by the applicant and was of the opinion that the signatures in the other documents were written by the same person as had written the control document. If that evidence had been accepted, clearly it would have been highly probative as showing that the applicant was deeply involved with Tai Wah in its business affairs, in particular the allocation of the export quota, and must therefore have been a party to the conspiracy to defraud.

10. At the trial Dr. Nutten gave that evidence but two experts from England were called on behalf of the accused, Mr. David Ellen and Mr. Robert Radley. They had also seen the documents which had been examined by Dr. Nutten. They disagreed with Dr. Nutten's conclusions and said that while some of the letters in the questioned signatures could be in the hand of the applicant they disagreed with his overall conclusion that the signatures were in his hand. Having very carefully considered all that evidence, the trial judge said that he had a doubt which he could not resolve and therefore he held that there had not been proved that the signatures "Eddy Lam" on the documents had been written by the applicant. However it was conceded, no doubt on the advice of the experts, that the text of the letter from Tai Wah which was found on the file in the Trade Department was written by the applicant.

11. It was the substantial ground of appeal argued by Mr. Sedgwick that once the evidence as to the signatures on the documents was not accepted, there was simply no sufficient circumstantial evidence to justify the trial judge's conviction and that indeed the Crown had nailed its colours to the mast on the basis of the evidence to be given by Dr. Nutten. It had not suggested that there was sufficient without that to convict the applicant and indeed that had been the initial conclusion of the trial judge.

12. There was a preliminary application pursuant to s. 8, article 53, article 10 and article 11(2) (c) of the Bill of Rights Ordinance on the basis that there had been an abuse of the process of the court because of the delay between the date of the arrest of the applicant and Lam Ho Ming and the date they were brought for trial. That application was dismissed and there is no appeal against that decision but what was said by the judge in his ruling is relied upon as showing the dependence which the Crown placed on the handwriting evidence. The trial judge said this:

"The case is not one which involves a test of witnesses' memories of observed events. It, I am told, relies heavily on documents to which witnesses would refer in order to refresh their memories. Indeed, in the case of the 1st accused, it is an agreed fact of this preliminary enquiry that the case against him revolves round an alleged handwriting expert's opinion on whose signatures appear on certain documents. If that is to be the determinative issue, the question whether there has been delay or not in investigating the case and bringing it against him appears immaterial to the question as to whether he would receive a fair trial."

13. Quite clearly it was a factor in the judge's decision as to whether the application for a stay pursuant to the Bill of Rights was influenced by the fact that the Crown's case substantially depended upon documents and not on the recollection of events to be given by eye-witnesses. However, in fact that was substantially the case. While clearly the Crown did rely on the handwriting experts, we can see no suggestion from the Crown's opening that that was regarded by counsel for the Crown as being the only evidence to be produced against the applicant. In any event, while the trial judge decided he could not accept the Crown's evidence relating to the signatures on the documents, it was conceded that the body of the letter found on the Tai Wah file in the Trade Department had been written by the applicant and that evidence, it seems to us, was very important.

14. Mr. Sedgwick relies on R. v. Leung Mun Lam, Crim. App. No. 134/85 where the Crown had presented its case against two defendants on the basis that they were in joint possession of dangerous drugs. However the trial judge directed the jury on the issue of whether the applicant there was guilty of aiding and abetting when that issue had not been raised by either the Crown or by the defence and was first referred to only in the summing-up. Yang J.A. said:

"We deprecate that part of the trial judge's summing up which deals with aiding and abetting, and would have had no hesitation in allowing the appeal if we came to the conclusion that the verdict was unsafe or unsatisfactory, or the defence had otherwise suffered gross miscarriage of justice."

We do not think such is the case here. Mr. Sedgwick complains that the applicant must have been given advice as to whether or not he should give evidence himself on the basis of what was understood to be the Crown's case - that it relied on the handwriting evidence. If it was known that the trial judge may have thought there was sufficient evidence even without that, the advice may have been different.

15. We can see nothing in the Crown's opening or closing addresses which indicated that its case against the applicant depended solely on the handwriting experts. Indeed, in view of that other evidence against the applicant, such an indication would have been very surprising. Clearly the three documents we have referred to were very important and it is true that two of them were not proved to come from the applicant but one of them was conceded to be written by him and without it the Crown may well have failed to prove its case. As for the ruling by the judge on the Bill of Rights issue all we take from that is that it was agreed that the case against the applicant depended primarily on documents and therefore delay, while unfortunate, was not such as to deprive of a fair trial.

16. We do not consider the facts here are in any way similar to those in R. v. Leung Mun Lam. The judge did not go off on a tangent of his own as he did in that case but considered the evidence which had been called by the Crown in a manner which cannot be in any way faulted. At the close of the Crown's case defence counsel must have realised that there was substantial circumstantial evidence against the applicant, including the writing of the letter to the Trade Department which was not disputed. No doubt the applicant was hopeful, in the light of the evidence available to him, to cast doubt on Dr. Nutten's conclusion as to the signatures but we do not see in any way that he was not fully aware what the evidence against him would be even if that should prove to be successful.

17. This ground of appeal must fail.

18. The second ground of appeal relied on by Mr. Sedgwick is that, without proof that the signatures "Eddy Lam", there was insufficient evidence to establish beyond doubt that the applicant was a party to the conspiracy. That evidence was:

1. He was a senior official in the Trade Department dealing with the allocation of quotas for the export of goods to the E.E.C. including the U.K. It was the Crown's case that the whole conspiracy would have failed if those involved in it had not, first of all, known a great deal about the procedure involved in the allocation of these quotas and there must have been somebody within the department who could ensure that no proper checks were made as to Tai Wah's application. In particular, this allocation was renewed for 1987 and that should not have been done without evidence of the actual shipment of the goods for which the 1986 quota had been allocated. There were no goods at all and there was no such evidence on the Tai Wah file in the Trade Department. The 1987 quota was later sold by Tai Wah for a substantial sum.

2. The telephone number given in the declaration filed as to the original false factory address of Tai Wah was the applicant's own telephone number.

3. The letter found on the Tai Wah file in the Trade Department, which gave information about Tai Wah's having changed its address, was written by the applicant. The letter in itself is perfectly innoxious in that it does not refer to any quota allocation but it is put forward by the Crown as showing that the applicant was involved in the management of Tai Wah.

4. The applicant and Lam Ho Ming, who was clearly deeply involved with the running of Tai Wah and the allocation of the quota, were seen frequently, having breakfast together in a cafe in Canton Road near to the applicant's office and also the Kowloon Hotel where Lam Ho Ming was a room attendant. The applicant was introduced to the witness who gave that evidence by Lam Ho Ming who said the applicant was an official in the Trade Department. This in itself did not prove anything and, of course, the applicant and Lam Ho Ming are brothers but it was put forward by the Crown as part of its case as showing that the applicant and Lam Ho Ming had ample opportunity to discuss the running of Tai Wah and the fraudulent scheme that was being perpetuated by means of that company.

19. We have no doubt that the trial judge was quite right in coming to the conclusion that the circumstantial evidence was such as to point irresistibly to the applicant being involved in Tai Wah. If not, there seems to have been no reason for his own home number to be put in the false particulars of the bogus factory that Tai Wah was supposed to operate. It was contended by Mr. Sedgwick that, so far as the letter was concerned, it was only reasonable for Lam Ho Ming to ask his brother to write that for him but that did not mean that the applicant was involved in the management of Tai Wah. On the contrary, it seems to us that if Lam Ho Ming was perpetuating his fraud through Tai Wah without the help of his brother, the last thing he would do would be to let the applicant know that he was personally involved in a bogus company seeking the allocation of textile quotas for export to the U.K. The letter simply told the Trade Department of a change of address. It required no skill of any sort or, unlike the other documents, some knowledge of quota allocation procedure. The writing of the letter by the applicant is strong evidence against him. The evidence of the applicant meeting with Lam Ho Ming on frequent occasions, as Mr. Sedgwick has said, must be viewed in the light of the fact that they were brothers and they worked in the same area. However, the evidence is relevant as showing that there was a close association between the applicant and his brother at about the time this fraudulent scheme was being perpetuated.

20. Neither the applicant nor Lam Ho Ming gave evidence as was their right but there is no doubt that an inference of guilt based on circumstantial evidence can be more readily drawn where there is no evidence from an accused person to rebut such an inference.

21. We are satisfied that this ground of appeal must also fail and that the application for leave to appeal must be dismissed.

22. Before leaving this case we would only like to say that although there was no appeal against the judge's ruling on the Bill of Rights issue on delay, we have read that ruling with interest and consider that it sets out the legal position and the matters which should be considered in deciding such issues in a way that will prove to be very helpful.

23. So far as the application for leave to appeal against sentence is concerned, it is only necessary to say that this was a conspiracy between the applicant and his brother to obtain by false documents an allocation of textile quota for the export of a substantial amount of children's clothing to the United Kingdom.

24. The 2nd defendant, the applicant's brother, was a room attendant in a hotel in Hong Kong and there is no reason to believe that, as the judge said, he was anything else but the front man in this operation. The applicant, on the other hand, held a senior position in the Trade Department and indeed in the very section which was dealing with the allocation of quota for export of textiles to the United Kingdom. Evidence was called after conviction and relating to sentence as to the profit that had been made from this scheme and it was very substantial indeed, $1,685,000. As the trial judge said, there were perhaps other people involved and it may well be that the applicant and his brother did not receive all that amount but it was certain that they received a substantial part of it. This, therefore, was an elaborate scheme carried out with a great deal of care and thought, to obtain these allocations. Having done so they were then sold for a very substantial sum of money.

25. We find it difficult to imagine a more serious case of corruption by a person in the applicant's position. It has been submitted, and we accept, that there was little direct evidence that the applicant was personally involved inside the Trade Department in facilitating the carrying out of the scheme. However from all the circumstantial evidence that was before the trial judge, that was an inevitable conclusion.

26. The applicant was sentenced to two years' imprisonment, the trial judge saying that he took a starting point of 2 1/2 years. There was little mitigation, such as a plea of guilty or assistance to the investigating authorities, but he did take into account, and we think quite rightly, that there had been a very long delay between the time of the arrest of the applicant and the trial. That was a matter which was the subject of an application under the Bill of Rights for dismissal of the charges. The explanation for it was that this case was part of a very substantial investigation and indeed one of the features which we find somewhat surprising in the trial was that some five witnesses from Europe were called to give evidence. No doubt the Crown felt that it had to prove its case as completely as possible but this does seem to have been something of an overkill in view of the costs involved.

27. Having said that we were satisfied that there was no merit whatever in this application for leave to appeal against sentence. If anything it was lenient.