HKSAR v. LEGASPI STEPHANIE JOY

CACC 241/2017

[2018] HKCA 594

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO 241 OF 2017

(ON APPEAL FROM DCCC NO 787 OF 2016)

________________________

________________________

________________________

J U D G M E N T

________________________

1.  The applicant faced three charges in the District Court, namely, Having custody or control of counterfeiting materials and implements, namely 5 printers[1], one MacBook[2] containing 15 complete images of Hong Kong dollar banknotes, one iPad[3] containing two complete images of Hong Kong dollar banknotes, 84 sheets of A4 size paper, inks, two ultra violet lights, one magnifying glass, one paper trimmer, one brief case and two albums[4], contrary to section 101(1) of the Crimes Ordinance, Cap 200 Charge 1; Possession of a dangerous drug, namely 0.60 gramme of a crystalline solid containing methamphetamine hydrochloride (commonly known as “Ice”), contrary to section 8(1)(a) and (2) of the Dangerous Drugs Ordinance, Cap 134 (Charge 2); and Possession of apparatus fit and intended for the inhalation of a dangerous drug, in the form of one inhaling device, contrary to section 36(1) and (2) of the Dangerous Drugs Ordinance (Charge 3).

2.  On 20 September 2016, the applicant indicated through counsel that she would plead not guilty to all three charges. Thereupon, the case was set down for a trial[5] before Deputy Judge Wong Sze Lai (“the judge”).  However, on 29 March 2017, with the trial due to commence that morning, the applicant pleaded guilty to Charges 2 and 3.  Accordingly, she stood trial in respect of Charge 1 only.

3.  On 12 July 2017, the judge convicted the applicant of Charge 1, and adjourned sentencing for a background report[6].  On 1 August 2017, the judge sentenced the applicant to an overall term of 44 months’ (or 3 years and 8 months’) imprisonment in respect of all three charges.

4.  On 4 August 2017, the applicant filed a Notice of application for leave to appeal against both conviction and sentence by way of Form X1.  On 14 December 2017, the applicant was refused bail pending appeal by a Single Judge[7].

5.  At the hearing of the leave applications on 4 September 2018, I indicated that I would reserve judgment and hand down my decision in due course.  This is my judgment.

The facts in relation to Charges 2 and 3

6.  The applicant and her boyfriend resided at premises in Block C, Whampoa Building, 99 Baker Street, Hunghom, Kowloon (“the flat”).  At about 10:29 am on 18 February 2016, police officers entered the flat and found, in one of the bedrooms, the applicant asleep while her boyfriend was using the MacBook.  At the time, the applicant’s father and elder brother were also inside the flat[8], although it is not suggested that they were connected with any offence.

7.  Upon a search of the flat, several things were seized, among them a metal box containing a transparent re‑sealable plastic bag containing a crystalline solid suspected to be Ice, an Ice bottle and other drug paraphernalia used in the consumption of dangerous drugs.  On arrest by PW1 (DPC 201), the applicant replied in Cantonese, “Ah Sir all these things are mine.  Nothing to do with my boyfriend”.  Later, she also confirmed in a written record of interview, taken between 3:08 and 5:10 pm on the same day, that the counterfeit banknotes and equipment for making counterfeit banknotes, as well as the dangerous drugs, were hers and nothing to do with her boyfriend.

8.  However, in a later video-recorded interview conducted at about 8:00 pm that same day[9], the applicant said that the dangerous drugs and equipment belonged to both herself and her boyfriend.  She claimed that a week earlier, she had purchased 1.75 grammes of Ice from an Indian male for $300.  She and her boyfriend had then consumed some of the dangerous drugs.

9.  In pleading guilty, the applicant accepted that the Ice, the subject matter of Charge 2, and the drug paraphernalia, the subject matter of Charge 3, were both in her possession at the time of her arrest.

10.  Pausing here, given one of the specific grounds of appeal against sentence, it is worth noting that the precise quantity of the methamphetamine hydrochloride narcotic component in Charge 2 was neither specified on the Charge Sheet nor in the Summary of Facts.  In the Government Chemist’s Certificate[10], the narcotic content was described as follows:

“1 plastic bag containing 0.60 gramme of a crystalline solid containing methamphetamine hydrochloride (a salt of methamphetamine) [and]

1 plastic bottle containing 16 millilitres of a liquid containing traces of methamphetamine.”

The prosecution case in respect of Charge 1

11.  It was not disputed that, when the police were searching the flat, counterfeiting materials and implements, the subject matter of Charge 1, were found inside the premises.  Upon subsequent analysis by PW7 (SSGT Tang)[11], a counterfeiting expert, both the iPad and the MacBook seized from the flat were found to contain, inter alia, some 35 images[12] depicting 33 Hong Kong dollar banknotes with denominations ranging from $5 to $500[13].  The prosecution alleged that the applicant either had the intention to use or would permit other persons to use the counterfeiting materials and implements, of which she had effective custody and control (as distinct from ownership)[14], for the purpose of making counterfeit currency notes.[15]

12.  In proving their case, the prosecution relied on the applicant’s out‑of‑court statements, in particular her admissions made in the written record of interview[16] to the following effect:

“Sir, those counterfeit banknotes, the equipment for making counterfeit banknotes, and dangerous drugs are all mine, it has nothing to do with my boyfriend, O’Neill Alexander Duncan. Please give me a chance.”[17]

13.  The applicant also admitted in the subsequent video-recorded interview[18] that, having downloaded a $500 banknote onto her iPad and having copied the lion’s head of the banknote in her drawings[19], she used one of the printers[20] to print the unfinished, or “semi-finished”, counterfeit notes five or six times[21], whilst further explaining that she and her boyfriend were making designs of the banknotes but not making them as finished products.  She said:[22]

“it’s just like our fun thing, we do art together, drawing… the equipment…are not specifically for printing out counterfeit money… the press printer … is to -- can make T‑shirts and make like images…”

The challenge to the admissibility of the out‑of‑court statements

14.  By way of alternative procedure, the defence contested the admissibility of both written and video-recorded interviews of the applicant.  Amongst other contentions, it was submitted that:

(i)  since the written record of interview contained obvious police jargon not commonly spoken or understood by ordinary people, the content was a distortion of what the applicant had actually said[23];

(ii)  the free will of the applicant in participating in the video-recorded interview was compromised by being overborne by oppressive words and conduct on the part of PW2 (WPC 57111)[24].

15.  It may be noted that when she was arrested by PW1 in respect the counterfeiting and drug offences at the scene at 11:10 am, the applicant’s reply, namely “Ah Sir, all these things are mine.  Nothing to do with my boyfriend”[25] was not preceded by any caution, nor did PW1 make a post-record of the applicant’s response.  The judge accepted that the reason it was not post-recorded was because the applicant had not been cautioned[26].

Defence case

16.  The applicant testified on the voir dire; however, after the ruling on the special issue had been given, she elected not to testify on the general issue but, instead, called her boyfriend to give evidence on her behalf.  Leaving aside the admissions which she claimed were involuntarily made, her case was that she was not in possession of all the counterfeiting material and implements forming the subject matter of Charge 1.  The banknote images were created by her and her boyfriend together as artwork[27].

17.  In his evidence, the applicant’s boyfriend (DW2) testified that he occasionally bought unique banknotes online for resale[28].  He was also interested in the intricate designs of old banknotes; the banknote images in the MacBook, which he said belonged to him, were his art work and graffiti design[29].  He testified that the applicant would often like to involve herself in what he was doing and so they sometimes worked together[30]. In cross-examination, he said he owned a collection of genuine banknotes, part of which was at the home of the applicant’s father[31].  In re‑examination, he said that the other part of his collection, namely some antique Hong Kong dollar banknotes, was kept on a bookshelf in the bedroom of the flat but that it had not been seized by the police[32].

18.  In closing submissions, defence counsel submitted, inter alia, that the prosecution had charged the wrong person with the wrong offence[33].

Reasons for verdict

(in respect of the special issue)

19.  The judge ruled that the applicant’s admissions in the written record of interview and video-recorded interview were voluntarily made[34]. In particular, the judge found that:

(1)  A Notice to Persons in Custody had been served on the applicant, who acknowledged that she understood her rights[35]. However, she made no requests of the police as a result.

(2)  Whilst her mother tongue was English, the applicant had confirmed that she understood the interpretation given by PW3 (the interpreter in the written record of interview)[36] in Cantonese.

(3)  It was not, as the defence suggested, a tactical move by the police to omit recording the applicant’s utterance upon arrest in her written record of interview.  A record had not been made simply because the statement had not been made under caution.[37]

(4)  The applicant’s allegations against PW2 were false[38].

(5)  It was clear from watching the video-recorded interview that the applicant was giving answers of her own volition[39], where she was assisted by PW4 (the interpreter in the video-recorded interview).

(in respect of the general issue)

20.  The judge attached full weight to the admissions made by the applicant in the written record of interview, namely that the counterfeit banknotes and the related equipment were all hers[40].  As to the video-recorded interview, the judge attached full weight to the inculpatory parts of the applicant’s admissions but no weight to the exculpatory parts of her admissions[41].

21.  The judge did not accept the contention that the banknote images were pieces of artwork, and further held that the images had no artistic value.  She said:[42]

“Having examined the images, I have come to the conclusion that if it was merely for artwork/design purposes, there was no reason for such images to be reproduced to such minute detail even if one were truly indeed [interested?] in the artwork/design of HK banknotes. In particular, I do not accept that one would have the words “Five Hundred Hong Kong Dollars” pasted onto a grid paper merely for examining its artistic design. After all, these words, in themselves, do not appear to have any artistic value and they do not show any special design. As can be seen, they were just ordinary English words and were printed in ordinary bold capitals. To suggest that one sees any artistic value or design interest in these words so much so that one had to so reproduce the words in the form in which they appeared defies common sense. The suggestion is simply untenable.

I find it as a fact that the images relate to the making of counterfeit HK banknotes.  They have nothing to do with what the DW claimed about any artistic interest.”

22.  In addition, the judge did not believe that the applicant’s boyfriend was a collector of genuine banknotes.  She said:[43]

“…the DW [defence witness] asserted that he traded in genuine banknotes and some of his stock were kept inside the flat. However, it is of note that PW5 conducted a detailed house search with a view to seizing any suspicious items which related to counterfeit currency. He seized almost 50 items in the flat but he found no genuine banknote collection and no pieces of artwork with images of banknotes of foreign currencies therein. This is contrary to what the DW asserted and I reject that the DW was a collector of genuine banknotes.”

23.  In relation to the mental element of the offence, namely the requirement that the applicant “intends to use or permit any other person to use for the purpose of making a counterfeit of a currency note … with the intention that it be passed or tendered as genuine”, the judge said:[44]

“Having considered all the evidence before me, that is, the number, the variety and the relative sophistication of the equipment seized; as well as the images and the half‑finished products found on the computers and the albums; I am sure that the defendant had in her custody or control the items listed in the charge with the intention that they be used for the purpose of making counterfeit currency notes and that she did intend those notes so produced be passed or tendered as genuine. I find that this is the only reasonable inference to draw from the proved facts. If it was for any other purpose, eg for fun or for artwork, I do not believe that one would go to such trouble to have the currency notes reproduced by the equipment particularized and to such detail and such precision as shown in some of the semi-finished products.”

Mitigation

24.  The applicant was 24 years of age, single and with no previous convictions.  She was educated to Form 5 level in Hong Kong and thereafter worked part‑time as a waitress and a model agent respectively.  In 2012, she left her job to look after her sick mother, who subsequently passed away in 2014.  She then began to consume Ice and became addicted to the drug.

Reasons for sentence

25.  In passing sentence, the judge noted that there was no tariff for the offence of having custody or control of counterfeiting materials and implements.  She referred to HKSAR v Wong Hoi Yat and others[45] for the relevant factors in sentencing a defendant convicted of such an offence.  Those factors included:[46]

“the quantity, value and the degree of sophistication of any of counterfeit copies; the scale of the operation; the nature and efficacy of the paraphernalia; and the length of time over which the offence had been committed; the role played by the defendant and the background of the defendant.”

26.  Applying these factors to the facts of Charge 1, the judge said of the instant case that:

(1)  The number of instruments and materials used for making counterfeit banknotes was not small[47].

(2)  There was a wide range of denominations of the banknote images, which were stored in the iPad and MacBook and which could be easily reproduced by a printer[48].

(3)  The level of sophistication of the counterfeiting was “not low”, with skilful drawings and designs which resembled those of genuine banknotes[49].

(4)  The role of the applicant in the offence could not be considered minor[50].

27.  Accordingly, the judge adopted a starting point of 3½ years’ imprisonment.  She found that there was no mitigation and accordingly passed a sentence of 3½ years’ imprisonment on Charge 1.

28.  As for Charge 2, the judge treated the quantity of Ice in which the applicant was found in possession as 0.60 gramme.  She adopted a starting point of 6 months’ imprisonment, after referring to the High Court decision in HKSAR v Babar, Imran[51]. The judge gave the applicant a full one‑third discount for her plea of guilty, resulting in a sentence of 4 months’ imprisonment.

29.  As for Charge 3, the judge referred to R v Law Sing[52] for the relevant sentencing guidelines.  Noting that the inhaling device here was kept at home only, the judge adopted a starting point of 6 months’ imprisonment and, similarly, gave the applicant a one‑third discount for her plea of guilty, resulting in a sentence of 4 months’ imprisonment.

30.  In terms of totality, the judge ordered that 2 months of the respective sentences on Charges 2 and 3, which were ordered to be served concurrently, should run consecutively to the sentence on Charge 1, thus making a total sentence of 44 months’ (or 3 years and 8 months’) imprisonment.

Grounds of appeal against conviction (on Charge 1 only)

31.  Mr Ross, on behalf of the applicant, has advanced four substantive grounds of appeal against conviction; a further, fifth ground being that by virtue of Grounds 1 to 4, the ruling on voluntariness and the ensuing verdict are unsafe.

32.  By Ground 1, it was argued that the judge erred in ruling that the written record of interview was voluntarily made by the applicant.  Mr Ross contends, firstly, that the speaking style of the admission in writing appears to be somewhat stilted and formal jargon, and hence the admission in such form was unlikely made by a lay person such as the applicant; secondly, the voluntariness of the admission ought to be considered in the context of the defence evidence on the general issue, that the materials found to be for counterfeiting belonged substantially to the applicant’s boyfriend.

33.  By Ground 2, it was argued that the judge wrongly rejected the evidence of the applicant’s boyfriend that he was a collector of, and traded in, genuine banknotes but treated what he said as mere assertion.

34.  By Ground 3, it was contended that the judge failed to consider that the applicant’s boyfriend might have been the sole and/or principal counterfeiter of the banknotes.

35.  By Ground 4, it was said that the judge wrongly found that there was no artistic value in the banknote images without the benefit of any expert evidence on the matter.  Mr Ross submitted that artistic merit should have been the subject of expert evidence, for which proposition he relied on R v Sharpe[53], a decision of the Supreme Court of Canada; and Cohen v G & M Realty[54], a decision of a judge of the Eastern District of New York, in the United States District Court.

Ground of appeal against sentence (on all charges)

36.  Mr Ross submitted that both the individual sentence of each charge and the overall sentence of 44 months’ imprisonment were manifestly excessive.

37.  In respect of Charge 1, it was argued that the judge failed to consider the following matters:

(i)  no finished products of counterfeit banknotes were seized from the flat;

(ii)  the drawings of the banknotes, whether done skilfully or not, ought not to have been treated as an aggravating factor;

(iii)  detection of fake banknotes is more difficult where, as here, the banknotes did not bear a metallic strip; and

(iv)  since the lower denomination banknote images were stored on computers, it suggested that the whole operation was rather inefficient.

38.  In respect of Charge 2, it was argued that, whilst the Ice had not been quantified, it was wrong for the judge to sentence the applicant on the basis of the weight of the crystalline solid containing the Ice[55].

39.  As for Charge 3, it was said that the judge, whilst correctly referring to R v Law Sing (supra) for the relevant sentencing guidelines, failed to note that the usual sentence after a timely plea of guilty was only 3 months’ imprisonment.

Respondent’s submissions

40.  Ms Sabra Lo, on behalf of the respondent, submitted that the judge had fully and properly considered the circumstances in which the written record of interview had come about.  The reasons for the judge’s ruling on the admissibility of such record were cogent and could not be impugned.

41.  She argued that the judge had sufficient grounds to reject the evidence of the applicant’s boyfriend.  In particular, contrary to his claim that he had a banknote collection in his bedroom, nothing of the kind was seized by the police.  That fact was relevant to whether he really was a genuine banknote collector, as he claimed.

42.  Ms Lo pointed out that the applicant’s defence at trial had never been that her boyfriend was the sole counterfeiter of banknotes.  DW2’s evidence was, however, to the effect that both he and the applicant had worked together on the banknote images for artistic purposes.

43.  It was further pointed out that the judge examined the banknote images herself and was entitled to find, based on her own common sense and experience of life, that the images had no artistic or special design value.

44.  She contended that the conviction in respect of Charge 1 was not unsafe; and that each starting point, the resulting sentence and the overall totality of the sentences in respect of all three charges could not be faulted.

Consideration

(leave to appeal against conviction)

45.  All of the grounds of appeal advanced take issue with the judge’s findings of fact; even Ground 3 is an argument that the judge failed to consider a defence which, it is suggested, arose on the facts, while Ground 4 avers that the judge was not legally entitled to arrive at certain findings of fact without expert evidence.  That the grounds are fact‑based is not to say that they cannot fulfil the threshold of ‘reasonable arguability’ on a leave application: however, it is generally more of a challenge for an applicant to come within such a test, particularly when that applicant has not given evidence.

46.  Ground 3 can be quickly dispensed with.  It was never the applicant’s case, nor did it form any part of her counsel’s closing address to the judge, nor was it ever raised as a live issue at trial, that DW2 was carrying on a solo counterfeiting operation without her encouragement or assistance. DW2’s evidence was that such work as he and she did was not done for the purposes of counterfeiting.   In support of this submission, Mr Ross cited the throw‑away line of the written closing submission of defence counsel, namely that “In essence, the prosecution have charged the wrong person with the wrong offence”[56]. However, Mr Ross’s interpretation of this sentence is not supported by the way the point was developed at trial by defence counsel either during DW2’s evidence, or in submission.  This ground is not reasonably arguable.

47.  Indeed, Ground 2 is an argument that DW2’s evidence should not have been rejected.  However, the judge gave what seem on the face of it to be perfectly cogent reasons for rejecting his evidence: it was her function to evaluate his evidence, for which she was far better placed than an appeal court.  Specifically, she gave reasons why she did not accept that he was, as claimed, a collector of banknotes[57]. Mr Ross places reliance on DW2’s apparently uncontested evidence that there were such genuine banknotes in a folder on the top shelf of a bookcase in the flat.  However, if that were the defence contention, one would have expected the Exhibits Officer PW5 (DPC 4844) to have been cross-examined about the folder and the existence of the banknotes inside it.  I have not seen his evidence, but the judge was able to state in her Reasons for Verdict that PW5 had conducted a detailed house search with a view to seizing anything suspicious relating to counterfeit currency.  Yet, despite seizing almost 50 items in the premises, “he found no genuine banknote collection and no pieces of artwork with images of banknotes of foreign currencies therein”[58].  This ground is also not reasonably arguable.

48.  Ground 4 avers that the judge required expert evidence as to (a) the utility of tracings and drawings in the production of banknotes, as against inkjet printing; and (b) whether the tracings and drawings had any artistic value.  However, this is not normally a question of expertise but a matter of common sense for a hypothetical jury examining the images individually and in their entirety.  Having viewed photographs of the exhibits myself, I consider it will be a difficult argument to unsettle the judge’s findings at paragraph 73 of her Reasons for Verdict; particularly when the applicant appeared to admit in her video-recorded interview that it was illegal to make such designs[59], albeit that her intention was not to counterfeit.  The ground is not reasonably arguable.

49.  Ground 1 concerns the judge’s findings in respect of the voluntariness of the applicant’s admissions, having conducted a voir dire as to admissibility.  The judge went into considerable detail as to why she believed the prosecution and disbelieved the applicant’s evidence on the voir dire.  Again, the judge was far better placed than an appellate court in assessing the credibility of witnesses: that is after all a judge’s function.

50.  Emphasis is placed on what is said to be the stilted, formal language of a police officer rather than a lay person, whose first language is English, in the answer to caution (set out at paragraph 12 supra). However, the applicant wrote these words herself after, as the judge found, being clearly advised of her rights.  She subsequently confirmed the statement was true and made of her own free will.  In the subsequent video-recorded interview, she did not seek to challenge what she had earlier said when it was recited to her by the officer[60], notwithstanding that it became apparent from her answers as the video-recorded interview unfolded that the answer to caution was not consistent with what she was saying in interview.  I do not consider this ground to be reasonably arguable.

51.  I am not persuaded, on the basis of the arguments advanced, that there are any reasonably arguable grounds of appeal against conviction and leave to appeal against conviction is accordingly refused.

(leave to appeal against sentence)

52.  I can see no reasonably arguable grounds of appeal in respect of the sentences on Charge 2 and Charge 3.  However the judge went about identifying the starting point and discount for each individual offence, an appellate court will ultimately only be interested in the effect of the sentence for the drugs offences on the overall sentence: in other words, it becomes a totality argument.  In this case, the applicant only received an extra 2 months’ imprisonment for the two drugs offences on top of the sentence on Charge 1.  I do not consider it reasonably arguable that the 2 months’ imprisonment could have been any less.  Furthermore, given the short consecutive element of the sentence for the drugs offences, I cannot see that the argument referred to at paragraph 38 above, even if it had merit, would make any difference.

53.  In respect of the sentence on Charge 1, it is true that there is no tariff or guideline for offences of this nature. Nevertheless, these offences are rightly taken very seriously by the courts.  One of the determining issues on sentence is the sophistication of the counterfeiting operation.  To that end, I have, like the judge, examined the exhibits.  Having done so, I doubt very much that any appellate court would disagree with the judge’s assessment that this was a sophisticated operation.

54.  I do not consider it to be reasonably arguable that a sentence of 3½ years’ imprisonment after a contested trial is either manifestly excessive or wrong in principle.

55.  The application for leave to appeal against sentence is likewise refused.

56.  Since I have refused the applications for leave to appeal against both conviction and sentence, I should advise the applicant that she has the right to renew either or both applications for leave to appeal to the Court of Appeal.  However, she is also warned of the consequences of so doing, which may include a direction for any loss of time spent in custody pending her appeal, if the Court were to come to the view that there was no justification for the renewal of either or both applications.