HKSAR v. CHEUNG TAK SHING RONALD

CACC 468/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 468 OF 2010

(ON APPEAL FROM DCCC 314 OF 2010)

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BETWEEN

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JUDGMENT

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Hon Yeung VP (giving the judgment of the Court):

Introduction

1.  Moët Hennessy Diageo Hong Kong Ltd (“MHD”) and its predecessor (Riche Monde Ltd) were local distributors of various brands of wines and spirit (“the merchandise”), and in order to promote them, MHD, in conjunction with entertainment spots such as karaoke lounges and bars, had to engage contractors to decorate designated areas for advertisement.

2.  The applicant (Cheung Tak-shing Ronald) was at the material times a Senior Marketing Manager of MHD and was responsible for the promotion of the merchandise.  He was authorized by MHD to be in charge of the promotion activities, including the selection of contractors for the decoration works and the authorization of payments to them. 

3.  Pun Shing-tak (“Pun”) was the sole proprietor of Stardust Design & Contracting Company and the sole shareholder and director of Stardust Ltd (hereinafter collectively referred to as “Stardust”).  Pun came to know the applicant when he was the Project Manager of California Red Karaoke.

4.  Between July 2004 and August 2007, the applicant, on behalf of MHD awarded over 20 decoration works to Stardust.  The total price of the 20 decoration works amounted to just over $2 million.

5.  Pun was arrested by the ICAC on 24 November 2008 and he voluntarily gave three video-recorded interviews (“VRIs”), in which he admitted, under caution, to have paid “kickbacks” to the applicant in connection with the decorations works awarded by MHD. 

6.  Pun was charged with six charges of offering an advantage to the applicant.  He pleaded guilty to three of the charges and the prosecution offered no evidence on the remaining three.  Pun was subsequently sentenced to 3 months and 1 week’s imprisonment.

7.  The prosecution alleged that, between August 2004 and May 2007, the applicant had solicited and accepted from Pun “kickbacks” of $388,000 for 11 decoration works totalling $1,633,081 awarded to Stardust without MHD’s permission and against the provisions of its Code of Conduct and Employee Handbook.

8.  The applicant was charged with 11 counts of “Agent accepting an advantage”, contrary to s 9(1)(a) of the Prevention of Bribery Ordinance Cap 201.  The applicant pleaded not guilty to the charges and appeared before Judge E Yip (“the judge”) in the District Court for trial.  Of the 11 charges against the applicant, six of them mirrored the six charges against Pun.

9.  On 1 December 2010, the judge convicted the applicant of all the charges and sentenced him to 21 months’ imprisonment.  The applicant had filed notices of application for leave to appeal against both conviction and sentence, but had since abandoned his application relating to sentence.  We are therefore only concerned with his application for leave to appeal against conviction.

The Prosecution Evidence

10.  The background facts were largely undisputed and the incriminating evidence against the applicant came mainly from Pun who gave evidence as an accomplice under immunity.

11.  Pun said that the applicant called him in June 2004, asking if he would be interested in taking up decoration works for the promotion of the merchandise.  When Pun indicated positively, the applicant said he would tell Pun what price to quote and that there was no need to keep the price down.  Pun understood that he would not be awarded the works if he refused to collude with the applicant.

12.  According to Pun, at a meeting, the applicant explained to Pun that he would tell Pun when there was a renovation project and a salesperson would contact him for a site visit.  Pun would then have to assess the price and quote it to the applicant orally and the applicant would tell him the amount to be inflated.  Thereafter, Pun had to add the inflated portion to the quotation before sending it to MHD and, after receiving payment, had to return the inflated portion to the applicant in cash.

13.  Pun said between August 2004 and May 2007, he had paid the applicant the various sums as set out in the 11 charges against him after receiving payments for the decoration works awarded by MHD.  The bribery payments to the applicant, except two, were made in cash in an open café in Taikoo Place. 

14.  There was a non-cash payment of $15,000, being part of the $60,000 bribe under Charge 6.  Pun said he had a cash flow problem and only gave the applicant $45,000 in mid-November 2005.  The applicant told Pun to pay the remaining $15,000 in two months’ time, but later called Pun, saying that he was in urgent need of money.  The applicant then gave his bank account number for Pun to deposit $15,000 on 12 January 2006.  It was admitted that Pun did withdraw $15,000 cash from Stardust’s account and $15,000 was paid into the applicant’s account on 12 January 2006.

15.  Pun also said that the applicant, in connection with the subject matter of the 11^th Charge, asked for a bribe of $80,000, which exceeded the contract sum of $79,000, and he only paid him $40,000 cash under a flyover near Sun Hung Kai Centre in May 2007.  Pun said he did not want to continue with the scheme and did not pay the remaining $40,000 to the applicant.  Thereafter, Pun received no more works from MHD and he chose not have any more contact with the applicant.  Stardust then closed down.

16.  Pun said that out of the total contract price of about $1.6 million, he had paid a total bribe of $388,000 to the applicant, which he had recorded in an Excel file in his computer.

17.  Apart from Pun, Ms Christina Shum and Ms Sandra Wong also gave evidence for the prosecution.  Ms Shum, the applicant’s assistant in MHD, told the court that the applicant could decide which contractor to appoint in connection with the decoration works as long as the money spent did not exceed the budget.

18.  Ms Sandra Wong, who worked under the applicant, was responsible for contacting contractors for quotations, verifying them before passing them to the applicant for approval. 

19.  Ms Wong said that the applicant always asked her to look for several contractors to give competitive quotations and when the quotations were back, the applicant also asked her to bargain down the price.  Ms Wong also said there were occasions when she found the price reasonable, yet the applicant still instructed her to bargain down the price or he would do it himself to the extent of yelling at the other side.

20.  Ms Wong confirmed that there were occasions when she was able to bargain down the price although she could not tell if it was at the expense of getting rid of certain unnecessary items of works.

The Defence Case

21.  The applicant denied having solicited or accepted any bribe from Pun.  The defences of lawful authority and reasonable excuse were not engaged.

22.  The defence suggested that although the applicant did not treat Pun badly, he nevertheless lied against the applicant, possibly because of the quarrels they had over the decoration works or perhaps because he was trying to minimize his own role in the events to achieve a reduction of sentence. 

23.  The defence suggested that Pun’s evidence was inconsistent with that of Ms Sandra Wong when, according to her, the applicant was eager to reduce Pun’s quoted price. 

24.  It was suggested that Pun was not telling the truth about the payment of $45,000 to the applicant when his bank account did not record such a withdrawal and that the state of his bank account did not support his evidence that he needed further time to pay the remaining $15,000 of the $60,000 bribe.

25.  The defence further attacked Pun’s evidence with reference to the contents of the VRIs and the Summary of Facts admitted by him when he pleaded guilty to three charges of offering an advantage to the applicant.

26.  The applicant, in his evidence, accepted that Pun did deposit $15,000 into his account on 12 January 2006, but claimed that it was the repayment of an urgent loan of $15,000 made to Pun in mid-2005. 

27.  The applicant said he had a high demand for workmanship from Pun and sometimes Pun failed to live up to the demand.  The applicant specifically mentioned an occasion when he scolded Pun severely for being irresponsible when Pun failed to provide a proper amplifier for a press conference held in Neway CEO Karaoke.  The applicant said since that incident, MHD had instructed him to look for other contractors in place of Stardust.  The implication was that Pun lied against him because of those matters.

The Judge’s Findings

28.  The judge had carefully analyzed the evidence with the defence’s case in mind.  The judge rejected the defence’s suggestion that Pun was trying to minimize his role.  The judge pointed out that Pun’s evidence in court had in fact revealed more instances of bribery, thus getting him into deeper troubles.

29.  The judge referred to the inconsistencies between Pun’s evidence and the records of his VRIs, but accepted the explanations he offered.  The judge found Pun a truthful and reliable witness, and accepted his entire evidence.

30.  The judge also accepted the evidence of Ms Christina Shum and Ms Sandra Wong, but did not find any inconsistency between Ms Sandra Wong’s evidence and that of Pun.

31.  The judge rejected the applicant’s evidence and found that the applicant had accepted the various sums as set out in the charges.  There being no dispute that the applicant was an agent of MHD and that the advantage was accepted, without lawful authority or reasonable excuse, as an inducement to or reward for doing an act in relation to MHD’s business, the judge convicted the applicant of all 11 charges.

Grounds of Appeal

32.  Mr David Ma, on behalf of the applicant, suggests that the judge had not adequately assessed and/or reconciled the discrepancies between the evidence of Pun and Ms Sandra Wong. 

33.  Mr Ma points out that according to Pun, he had inflated the quotation on the applicant’s suggestion and that in relation to all the charges in question, he had included the inflated portions into the quotation before submitting the same to MHD.  With particular reference to Charge 7, Mr Ma emphasizes that according to Pun, the original quotation made orally to the applicant was $122,000 and it was inflated to $152,000 by adding a bribe of $30,000 whereas according to Ms Sandra Wong, there was a prior quotation of more than $152,000 and the $152,000 was only submitted later. Similarly with Charge 6 when it was Ms Sandra Wong’s evidence that a quotation of more than $174,000 was originally submitted. 

34.  Mr Ma suggests that the judge had not sufficiently warned himself of the danger of relying on the evidence of Pun when he was an accomplice witness giving evidence under immunity.  Mr Ma suggests that the judge should have reminded himself that there was no corroboration of Pun’s evidence and that if the judge had done so, he would have found Pun’s evidence not reliable.

35.  Mr Ma further suggests that the judge had not given reasons for rejecting the applicant’s evidence other than saying that he believed Pun’s evidence in its entirety.  In the circumstances, Mr Ma suggests that the conviction against the applicant is unsafe or unsatisfactory.

Discussion

36.  As the judge rightly observed, the prosecution case against the applicant rested almost entirely on Pun’s evidence and he asked himself the question of whether Pun had “framed up” the applicant. 

37.  In assessing Pun’s evidence, the judge was of course fully aware that Pun was an accomplice witness giving evidence under immunity.  The judge had reminded himself that there was always the danger that a witness such as Pun might “frame up” a defendant in order to minimize his own part in the events to achieve a reduction of sentence. 

38.  The judge, in accepting Pun’s evidence, pointed out that Pun, in his evidence, had made no attempt to minimize his role, but instead had made his position worse. 

39.  The suggestion that the judge had not sufficiently reminded himself of the danger of relying on Pun’s evidence is unfounded.  The judge had in fact repeatedly warned himself that he must approach Pun’s evidence with great caution.

40.  The judge is a professional judge and must be aware of the approach he should adopt towards Pun’s evidence.  In his assessment of Pun’s evidence, there was no legal requirement for the judge to look for corroboration as suggested by Mr Ma.

41.  The undisputed evidence showed that over a period of almost three years, there were multiple transactions between MHD and Stardust.  The procedure involved MHD putting forward specifications of the works required and the submissions of quotations by Stardust.  There were occasions when unnecessary items of works would be deleted, resulting in corresponding reductions in prices.  According to Pun, he had to seek instruction from the applicant first before submitting quotations with the “mark-ups” as suggested by the applicant.

42.  When Ms Sandra Wong suggested in her evidence that there was a prior quotation from Pun of more than $152,000 and that $152,000 was only submitted later, it could have been, as the judge had pointed out, the result of the deletion of unnecessary items of works.

43.  When Pun said he had submitted only one quotation of $152,000, he could have been mistaken or he could well be talking about the final quotation after oral discussion with the applicant and the making of necessary adjustments.  The applicant, being the person in charge, could so easily have taken steps to make his selections of, and payments to contractors look proper. 

44.  On the evidence, we are not persuaded that the suggested “discrepancies” have any significance. 

45.  The defence suggested that Pun had lied to “frame up” the applicant.  The judge reminded himself the question: “Did Pun frame up (the applicant)?”

46.  We, too, have asked ourselves: “Was there any possible motive for him to do it?”

47.  We must not ignore that by lying against the applicant in this case, not only was Pun making untruthful and wrongful accusation against the applicant, he was also unnecessarily implicating himself in crimes for which he was punished by a court of law.

48.  There was no conceivable reason for Pun to do it.

49.  The judge had fully and carefully analyzed the evidence both of the prosecution and the defence.  The judge had also examined the applicant’s evidence critically.  In our view, the judge was entitled to accept the evidence of Pun and reject the evidence of the applicant.  On the evidence accepted by the judge, the applicant was properly found guilty of the charges.

Conclusion

50.  We do not find the conviction against the applicant in anyway unsafe or unsatisfactory.  The application for leave to appeal against conviction is dismissed.