HKSAR v. CHIU TERESITA D. AND OTHERS

HCMA635/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

(Appellate Jurisdiction)

MAGISTRACY APPEAL NO.635 OF 2000

(ON APPEAL FROM ESCC 1958 OF 2000)

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J U D G M E N T

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1. The appellant was the 4th defendant at the trial and he was charged with the offence of breaching a licence condition, contrary to section 46(1) of the Dutiable Commodities Ordinance, Cap.109. The particulars of the amended charge of which he was eventually convicted were as follows :

"Breach of a licensing condition, contrary to section 46(1) of the Dutiable Commodities Ordinance, Cap.109.

YIP Bun-keung, on the 29th December 1999, at Venus, Shop 1 & 2, Floor G, 89 Lockhart Road, Hong Kong, being the holder of a liquor licence in respect of the premises, contravened a condition lawfully imposed under the Dutiable Commodities Ordinance, namely clause 7 of the licensing conditions, by permitting the premises or part thereof to be used for an immoral purpose, namely sexual activities between a member of staff and a customer, Paul Andrew Turner."

2. The appellant pleaded not guilty and was convicted after trial by the learned magistrate in Eastern Magistracy. He appealed to the Court of First Instance and Mr Duncan, for the appellant, had raised a number of grounds. Having considered the relevant transcript, the Statement of Findings and the submissions, I had dismissed the appeal and judgment was handed down on 18 December 2000.

3. Mr Duncan now applied to this court for leave to appeal to the Court of Final Appeal, arguing that two points of law of great and general importance were involved in the decision. The two points of law, as formulated by Mr Duncan, were as follows :

"(1) Can a person, other than the licensee of premises licensed under the Dutiable Commodities Ordinance, Cap.109 ('the Ordinance'), be guilty of the offence of 'being the holder of a liquor licence in respect of certain premises, contravened a condition lawfully imposed in such licence' such that licensee of the premises can be vicariously liable for the actions of such person pursuant to the provisions of S.46A of the Ordinance.

(2) Can there be a case to answer against a person charged, contrary to section 46(1) of the Ordinance, with the offence of 'breach of a licensing condition' by permitting premises licensed under the Ordinance to be used for an immoral purpose, in the absence of any evidence that such person was at the premises at the time they were so used by virtue of a duty of the person as licensee of the premises to ensure compliance with the conditions in the relevant licence and a stipulation in such licence that the licensee shall personally supervise the premises."

4. Mr Duncan had prepared a written skeleton explaining the two points raised. He stated that :

"1.1 Point is concerned with doctrine of vicarious liability.

1.2 Normally, a person can be convicted of a crime only in respect of acts for which he is responsible. To be criminally responsible for the acts of others is exceptional.

1.3 If such responsibility is to arise it must be by virtue of clear wording : equally the wording must be strictly complied with.

1.4 It is arguable in this case that such wording has not been strictly complied with in that a servant cannot be guilty of an offence an essential ingredient of which is that the defendant be the licensee.

2.1 Point is concerned with whether criminal liability can arise by reason of a 'breach of duty'.

2.2 The law contains many instances of breaches of duty which are themselves substantive offences (e.g. failing to file a return, report an accident etc.,)

2.3 Instances of a breach of duty otherwise giving rise to a criminal offence are exceptional (examples include breach of duty of care giving use to an offence of manslaughter).

2.4 It is arguable in this case that the 'duties' breached are not such as to give rise to criminal liability for an activity which has not been proven."

5. Mr Duncan had also made an oral submission expanding on the points raised in the skeleton.

6. Concerning the first point, the main issue was in relation to section 46A of the Dutiable Commodities Ordinance, Cap.109. The section reads :

" (1) Where an offence against this Ordinance is committed by a servant of a licensee, the licensee shall, without prejudice to the liability of any other person, also be guilty of that offence but shall not be liable to any term of imprisonment.

(2) Where a prosecution is brought against a licensee by virtue of this section in respect of an offence committed by a servant, it shall be a defence -

(a) in the case of an offence against section 61,71, 72 or 73, if the licensee shows that he exercised such control over the servant as would ensure that the servant was not likely to act in contravention of that section; or

(b) in the case of any other offence, if the licensee shows that he took all practicable steps to prevent the commission of the offence.

(3) Where a licence is granted to any person wholly or partly for the benefit of a company references to 'licensee' in this section shall be read as including references to the company."

7. Mr Duncan had cited some passages in Halsbury's Laws of Hong Kong, Vol.9 to illustrate the basic point that various liability is not the norm but an exception in our criminal law (Vol.9, Paras. 130.062-066). He further stressed the importance of the following wording in the section :

"Where an offence against this ordinance is committed by a servant of a licence, the licensee shall, ..., also be guilty of that offence..."

Mr Duncan submitted that the servant must be guilty of the same offence before the section had any application. But here, it was at least arguable that where the offence involved the licensee's status as an element of the offence, then it could not be committed by the servant. And so, in turn, it meant that the servant's conduct could not be attributed to the licensee. Against the background of the findings in the present case, I had already indicated my disagreement with Mr Duncan's analysis.

8. The issue is now whether this point satisfied the condition for a certification by this court to allow the matter to go before the Court of Final Appeal. Having reflected on the submissions, I would say no. First, there was no challenge that section 46A does create in principle a vicarious liability on the licensee. In the present case, as a matter of factual findings, the learned magistrate concluded that the servants, i.e. the other defendants, were involved, one way or another, sexual service or activities with customers on the premises of the club. The question to be considered was whether the licensee could be found vicariously liable under such circumstances. The magistrate had ruled against the appellant and I supported the magistrate's decision. I had expressed my views on the topic in my judgment (pages 18 to 20). In any event, while I would not say that this was a totally insignificant point, I was not satisfied that it constituted a point of great and general importance.

9. Regarding the second point, I believe the relevant passage in my judgment was as follows :

" I found I was unable to agree with this submission. Knowledge could be inferred from the circumstances. Although there was no direct reference by the prosecution witness regarding the presence of the licensee, it would not necessarily result in a no case to answer. The charge involved the allegation that the licensee permitted a state of affairs to happen. If indeed the licensee, who was under a duty to ensure the compliance of the conditions in the licence, was not even present on the premises where sexual service was, according to the prosecution evidence, so readily available from the staff of the club, that might well be a valid basis for an inference that he had had prima facie permitted such activity to take place. This was particularly so when the licencee was also the manager of the club. It should be noted that condition 4 in the licence stipulated that the licensee shall personally supervise the premises. In the circumstances, I was not entirely persuaded that in the circumstances, the learned magistrate should have ruled as defence counsel had proposed."

And I further found that :

" In any case, if the learned magistrate took the view that a liability under section 46(1) could arise in an indirect manner as provided for by section 46A(1), there would necessarily be a case to answer on that basis. In my view, there was no material irregularity involved and that the finding of a case to answer was not an error."

10. Although the proposed point of law was couched in terms of whether the breach of one condition could constitute the basis of a breach of another condition in the licence, in my view, the gist of the matter remained to be whether the learned magistrate was correct in holding that there was a case to answer, when there was no direct evidence in the prosecution case that the appellant was present. Clearly, this involved a question of what inference could be drawn and it must depend on the evidence and circumstances of each case.

11. I had simply pointed out in my judgment that there were matters in the prosecution evidence that could justify the ruling by the magistrate. The main issue arising from the charge was whether the licensee had breach a licensing condition by permitting a certain state of affairs to take place. This would be largely a matter of factual finding. Furthermore, if the magistrate were right in the applicability of section 46A, then this point about breach of duty would be academic for the purpose of the appellant's conviction. I would decline to certify this point also.

12. I am grateful to Mr Duncan to have referred me to a number of appeals which had been dealt with by the Court of Final Appeal. He had singled out the issues in these authorities to illustrate what points of law had been considered fit for the determination of the Court of Final Appeal. He submitted that so far the approach adopted in certifying the points of law appeared to be rather generous. While I appreciate Mr Duncan's assistance, but these authorities only showed what points had been successfully referred to the Court of Final Appeal. In light of section 32 of the Hong Kong Court of Final Appeal Ordinance, Cap. 484, I believe I must still ask the crucial question myself, which was whether the present points were of great and general importance. I would rather not venture to speculate whether the approach in granting leave had been generous or otherwise.

13. Having carefully considered the submissions, as I said, I was not satisfied that the proposed points of law were of great and general importance. I would therefore dismiss the application accordingly.