HKSAR v. YUNG LAI LAI

[English Translation - 英譯本]
CACC 321/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO.321 OF 2011

(ON APPEAL FROM DCCC 131 OF 2011)

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J U D G M E N T

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

Introduction

1. The Applicant, Yung Lai Lai, was prosecuted together with eight other defendants of one count of conspiracy to sell infringing copies of optical discs contrary to section 118(1)(d) of the Copyright Ordinance, Cap. 528 and sections 159A and 159C of the Crimes Ordinance, Cap. 200 of the Laws of Hong Kong.  The Applicant pleaded not guilty and appeared before Deputy District Judge Anthony Yuen for trial.

2. On 1 August 2011, Deputy Judge Yuen found the Applicant guilty and on 5 August 2011 sentenced her to 18 months’ imprisonment.

3. The Applicant felt aggrieved by the conviction, and, through the representation of Mr. Patrick Lim and Mr. Gary Leung, has made an application for leave to appeal against conviction.  The Applicant is also aggrieved with the sentence, against which she makes an application at the same time seeking leave to appeal.  For the application regarding the sentence, the Applicant is unrepresented and acting in person.

Prosecution’s Case

4. In October 2010, customs officers found that infringing copies of optical discs were sold in Shop No.17, Ground Floor, Wing On Shopping Plaza, Fuk Wa Street, Shamshuipo (“the Shop”). The infringing copies in question came from those stored in the unit at 7/F, No. 59-61, Prince Edward Road West (“the Storage”).  Investigation revealed that the ten-odd persons who took part in the offence played different roles in the process of selling the infringing copies, including distributing promotional business cards on the street, selling discs in “the Shop”, picking the discs required by the customer in “the Storage”, and delivering the discs bought by the customer to “the Shop” for handing them over to the customer.

5. The surveillance and investigation of the customs officers revealed that the selling of infringing copies was conducted in the following way: somebody would in Shamshuipo area distribute to passers-by promotional business cards bearing on one side the words “software station”, “computer software, Wii games, movie DVD” and the address of “the Shop”, while on the other side the words “coupon valid permanently” and “where the value of purchase made in our shop reaches $100, one free disc will be given on presentation of this coupon.  Buy more get more free”.  The business card also bore a mobile phone number.

6. The wall of “the Shop” was full of the covers of computer software, games machines and movie discs on which there were code numbers.  Outside the door, slips and pencils were provided for customers, who wrote down on the slip the code numbers of the discs which he / she wished to buy and handed the slip to the male who was attending “the Shop”.  The male would write down on the slip the order number, the amount and the time for goods collection and return the slip to the customer, who would be told by him to come back to “the Shop” later for collecting the goods.

7. The male attending “the Shop” would immediately ring up the person who was responsible for picking discs in “the Storage” giving him instructions.  The one attending to “the Storage” would pack the discs chosen by the customer according to the instructions and take them to the vicinity of the ground floor handing them over to someone else to deliver to “the Shop”.

8. The duty of discs delivery was firstly performed by two males, who would take the discs to Apliu Street and Kweilin Street on foot or by cycling using different routes and hand them over to another male, who would then take the discs to the corridor outside “the Shop” or the vicinity there on foot using different routes and placed them there.

9. After the male who was responsible for selling discs in “the Shop” had got the discs, he would hand them over to the customer who came for collecting the goods.

10. Customs officers also saw that after “the Shop” was closed, someone distributed money to those people who took part in the selling of the infringing copies.

11. The covers of the infringing copies seized by the custom officers from “the Shop” bore the code numbers.

12. On 27 November 2010, undercover customs officers purchased infringing copies successfully from “the Shop” by the aforesaid way on five occasions, the purchase on each of which was made in the same mode.

13. Later on, customs officers in “the Shop” and the vicinity seized 40 optical discs, 11 of which were infringing copies, while in “the Storage” 4,835 optical discs were seized, nearly 900 of which were infringing copies.

14. After surveillance and investigation, custom officers had also arrested a number of persons, including Chiu Yuk Wah and Cheung Fai Wing, who played different roles in the aforesaid process of selling the infringing copies.

15. It was Chiu Yuk Wah who collected money and handed over the infringing copies to the undercover customs officer on four of the five occasions on which the undercover customs officer purchased infringing copies from “the Shop”.  Cheung Fai Wing had also been in “the Shop” giving instructions on the price of the infringing copies to the person selling the discs in “the Shop”.

16. At the time of arrest, Cheung Fai Wing intended to flee.  Upon caution, he also admitted that he took part in the selling of the infringing copies.

Evidence against the Applicant

17. According to the evidence of the undercover customs officers, before going to “the Shop” for buying infringing copies, they saw the Applicant at the exit of “Golden Computer Centre” situated at the junction between Kweilin Street and Fuk Wa Street, Shamshuipo.  The Applicant handed over to the undercover customs officers business cards bearing the particulars of “software station” and the address and phone number of “the Shop” and gave directions to them on how to get to “the Shop” to buy optical discs.  At the same time she told the undercover customs officers clearly that software games and movie optical discs were available in “the Shop”.  The Applicant did tell the two undercover customs officers, “Software and movie are available.  For movies, 7 discs for $100.”  She had also indicated to an undercover customs officer that there were a lot of new movies optical discs.  The phone number on the business card distributed by the Applicant was 6775 8699, which belonged to one of the persons who took part in the conspiracy to sell infringing copies.

18. On 27 November 2010 at 5:15 pm, a customs officer saw the Applicant walking along Fuk Wa Street and stopping at the junction with Kiu Kiang Street talking to Chiu Yuk Wah.

19. Upon arrest, customs officer found upon search from the pocket of the garment which the Applicant was wearing a large quantity of software station business cards.  When being asked about the uses of the business cards, the Applicant said, “I know that cheap discs are available here.  (I) got (these) for distributing to my friends.”  The Applicant also told the customs officer that she knew that ‘cheap discs are available in “the Shop”.’

20. Customs officer seized on the Applicant two mobile phones and five SIM cards.  The call records of those two mobile phones showed that between 21and 27 November 2010, the Applicant had conversations with Cheung Fai Wing on many occasions.

Defence

21. The Applicant did not give evidence for her defence, nor did she call any witnesses to testify for her. Her position was that the prosecution had failed to adduce sufficient evidence to prove her guilt, particularly the prosecution had failed to prove that she knew that infringing copies were available in “the Shop”.

Findings of the Trial Judge

22. The trial judge accepted the evidence obtained by the customs officers from their surveillance and investigations.

23. The trial judge found that “the Shop” sold infringing copies and the mode of selling was that the customer wrote down the code number of the required optical disc and handed it over to the person attending to “the Shop”, who would hand over a piece of paper to the customer reminding him / her when to come back to “the Shop” for collecting the goods.

24. The trial judge pointed out that the large quantity of infringing copies stored in “the Storage” were provided for “the Shop” for the purpose of sale, during the process of which somebody would be responsible for delivering the optical discs required by the customer from “the Storage” to “the Shop”.

25. The trial judge found that indeed there was a syndicate involving in selling infringing copies, and different defendants did agree to take part in the offence of selling infringing copies and played different roles in the selling process.

26. As far as the role of the Applicant is concerned, the trial judge’s findings are as follows:

“49.  No doubt, D5 was in the vicinity of Wing On Shopping Plaza introducing this shop to the passers-by.  The conversations D5 had with the undercover customs officers showed that very obviously she knew where Shop No. 17 was and was clear that the optical discs sold in Shop No. 17 included computer software, movie DVD etc.  It also included currently showing movies.  The price was as low as 7 discs for $100.  There is also evidence to show that D5 had contact with D6.  In fact, it is very difficult to imagine that D5 knew nothing about the situation of Shop No. 17, that is, in fact no optical discs were shown inside Shop No. 17 for the customers to choose but only optical discs covers were on the walls.  Therefore, D5 must have known that the process of selling optical discs involved other people, including “the Shop” attendant and somebody who would deliver the optical discs required by the customer to Shop No. 17 from another place.

50.  Furthermore, it is impossible for D5 not to have known that this shop sold optical discs in an unusual way.  Also, D5 also knew very well that the price of the optical discs was as low as 7 discs for $100 including currently showing movies. Therefore, it is impossible for D5 not to have known that these optical discs included infringing copies.”

Grounds of Appeal

27. The grounds of appeal put forward by Mr. Patrick Lim for the Applicant are mainly that the prosecution evidence could not lead to an inference of guilt to be drawn.  Mr. Lim was of the view that the trial judge should not have:

(1) drawn the inference that the Applicant knew that infringing copies were available in “the Shop” because she knew where “the Shop” was;

(2) drawn the inference that what the Applicant referred to was “currently showing movie” because she mentioned about “new movie”;

(3) drawn the inference that what the Applicant referred to included computer software because she mentioned about “7 discs for $100”;

(4) drawn the inference that the Applicant knew the situation of “the Shop” and the way in which infringing copies were sold because she had contacts with D6 Chiu Yuk Wah; and

(5) drawn the inference that the optical discs to which the Applicant referred included infringing copies of movie optical discs because she had said, “7 discs for $100”.

28. Mr. Lim also submitted that when finding the Applicant guilty, the trial judge had failed to take into consideration some evidence which was favorable to her, including the fact that “the Shop” was very far away from where the Applicant was distributing promotional business cards; the Applicant had never been in “the Shop” or in its vicinity; the Applicant had never have any contacts or dealt with any infringing copies; and there was no evidence to show that the Applicant had taken part in the selling of the infringing copies or had any knowledge on the process of selling the infringing copies.

Respondent’s Position

29. Mr. Hayson Tse, Assistant Director of Public Prosecutions, acting for the Respondent, agreed that the prosecution’s evidence could not support the trial judge’s findings that the applicant knew about the situation of “the Shop”, the involvement of other people in the process of selling the optical discs and the way in which the optical discs were sold.  Mr. Tse also agreed that the prosecution evidence could not prove that when the Applicant said that the price of the optical discs was 7 discs for $100, the optical discs to which she referred must be the one of currently shown movies or computer software.  However, Mr. Tse contended that the prosecution evidence could lead to an irresistible inference showing that the Applicant knew that “the Shop” indeed sold infringing copies.  Mr. Tse set out the basic facts, which in his view, were against the Applicant.  He emphasized, in particular, that the knowledge of 7 currently showing movies optical discs being sold only for $100 showed that she knew that the optical discs sold in “the Shop” were infringing copies.

30. Furthermore, Mr. Tse also tried to strengthen the prosecution’s case with the provisions of sections 118(1)(d) and (3) of the Copyright Ordinance, that is-

(1)     A person commits an offence if he, without the licence of the copyright owner of a copyright work-

(a) …

(b) …

(c) …

(d) sells, lets for hire, or offers or exposes for sale or hire an infringing copy of the work for the purpose of or in the course of any trade or business;

…

(3)  It is a defence for the person charged with an offence under subsection (1) or (2A), to prove that he did not know and had no reason to believe that the copy in question was an infringing copy of the copyright work.

31. Mr. Tse’s original position was that even if the Applicant did not know that “the Shop” did sell infringing copies, she had still contravened section 118(1)(d) of the Copyright Ordinance, unless she could, pursuant to section 118(3), prove that she did not know and had no reason to believe that “the Shop” did sell infringing copies.  Mr. Tse submitted that even if the charge faced by the Applicant was not under section 118(d) of the Copyright Ordinance, but only conspiracy to contravene that section, the situation was the same.  Mr. Tse contended that unless the Applicant could prove that she did not know and had no reason to believe that “the Shop” did sell infringing copies, the conviction of the Applicant should be upheld.  Regarding Mr. Tse’s aforesaid position, Mr. Lim did not make any reply in his original written submission.  We asked the counsel of both sides to make supplemental written submissions on whether section 118(3) was applicable to the offence of conspiracy.  We also granted bail to the Applicant until we gave the judgment.

Discussion

32. In the present case, no doubt there was a conspiracy to sell infringing copies of optical discs.  The undercover customs officers successfully bought infringing copies from “the Shop” on many occasions and a large quantity of infringing copies were seized upon search during the operation.  According to the observations of the customs officers, somebody was responsible for promotion, somebody received order instructions and collected money for the goods in “the Shop” and conveyed the order instructions to “the Storage”.  The person in “the Storage”, on the instructions of the customer, delivered the required discs to “the Shop” in an indirect way for handing them over to the customer.

33. The aforesaid undisputed evidence proves that there was a conspiracy to sell infringing copies, to which Mr. Lim for the Applicant did not have any disputes.

34. Therefore, as far as the charge against the Applicant is concerned, the factual dispute which needed to be solved was whether she was related to the conspiracy to sell optical discs in “the Shop” and whether she knew that “the Shop” sold infringing copies.

35. In his written submission, Mr. Lim contended that the place where the Applicant distributed promotional business cards was very far away from “the Shop”.  In fact, we cannot see any significance of this.

36. The undercover customs officers said in their evidence that when distributing the promotional business cards, the Applicant at the same time directed them to “the Shop”, and the undercover customs officers could, by following the directions given by the Applicant, successfully find “the Shop”, which was located at Wing On Shopping Plaza.  The business card distributed by the Applicant even bore the map indicating the location and the phone number of “the Shop”.

37. Under the aforesaid circumstances, no doubt, the distribution of business cards made by the Applicant was related to “the Shop”.  Therefore, the main factual dispute involved in the case was whether the Applicant knew that infringing copies were available in the “the Shop”.

38. There was no direct evidence to show that the Applicant knew that somebody sold infringing copies in “the Shop”.  As Mr. Lim had correctly pointed out, the factual dispute in the case was whether, on the facts found by the trial judge, the inference that the Applicant knew that the optical discs sold in “the Shop” included infringing copies was correctly drawn.

39. When dealing with the above issue, the Court of course should not deal with the evidence against the Applicant separately and one after another but take all the evidence as a whole into consideration.

40. According to the evidence of the undercover customs officers who posed as customers, the Applicant had been distributing promotional business cards to passers-by in the vicinity of Wing On Shopping Plaza for a long time and said that optical discs were available in Wing On Shopping Plaza.  After arrest, there were 60-odd promotional business cards on the Applicant, and she told the undercover customs officers that she intended to introduce friends to go to “the Shop” to buy discs.  The business cards distributed by the Applicant bore the words “software station’, “coupon valid permanently”, “computer software, Wii games, movie DVD” etc.  The Applicant had even said, “Discs are available.  It is said that it is very cheap.  I have no idea.”  When being asked as to what sort of discs were available, the Applicant said, “I have no idea.  Whatever stated on the business card will be available.”  The aforesaid reply of the Applicant was neither true nor accurate, and it also caused others to have suspicions on what she did. However, the trial judge did not make a decision against her because she had told lies.

41. What we have to consider is whether the evidence adduced by the prosecution can lead to an irresistible inference showing that the Applicant knew that “the Shop” indeed did sell infringing copies.

42. The evidence against the Applicant only comes from the three undercover customs officers, namely, 9989, 8985 and 98264.  According to undercover customs officer 9989, apart from telling him where “the Shop” was, the Applicant also had the following conversations with him:

“ Customs Officer:	‘Are the discs there expensive?’
Applicant:	‘It depends on what you want to buy.’
Customs Officer:	‘Any Japanese drama series?’
Applicant:	‘There are no Japanese drama series.  However, there are movie optical discs – but there are movies.’ ”

43. Another undercover customs officer 8985 said that the Applicant told him that Windows 7 was available.  If he went to make purchase with the promotional business card, then one free disc would be given.  As a result, undercover customs officer 8985 also successfully bought six sets of infringing copies of “Microsoft” software for $500.

44. According to the evidence of undercover customs officer 98264, when distributing business cards, the Applicant said to him, “Software and movie are available, 7 discs for $100.”  The undercover customs officer further asked her, “What are the new movies?”  The Applicant said, “Many”.

45. By following the directions given by the Applicant, undercover customs officer 98264 arrived at “the Shop” and successfully bought 7 infringing copies of movie optical discs for $100, including Ip Man (葉問), The Legend is Born – Ip Man (葉問前傳), Detective Dee and the Mystery of the Phantom Flame (狄仁傑之通天帝國), Green Zone (叛逆諜戰), The Sorcerer’s Apprentice (魔法師的門徒), Inception (潛行空間), and The Stool Pigeon (線人).

46. Apart from the aforesaid evidence, there is also evidence showing that the Applicant did have conversations with Chiu Yuk Wah, who was responsible for collecting money and handing over infringing copies in “the Shop”.  The mobile phones seized on the Applicant showed that she had telephone conversations with another person, namely, Cheung Fai Wing, who was responsible for selling infringing copies in “the Shop”, on many occasions during the period in question.

47. After arrest, the Applicant also told the customs officers that she knew that “cheap discs are available” in “the Shop”.

48. All the aforesaid evidence is unfavourable to the Applicant.  However, we are of the view that even if all the evidence is accepted, it still cannot lead to an irresistible inference showing that the Applicant knew that infringing copies were indeed available in “the Shop”.

49. The conversations between the Applicant and Chiu Yuk Wah and the conversations on many occasions with Cheung Fai Wing during the period in question cannot prove that she must have known that “the Shop” indeed did sell infringing copies. Being responsible for distributing business cards for “the Shop” for promotional purpose, the Applicant needed to have contacts with other persons who were in charge of “the Shop”.  These contacts cannot prove that the Applicant must have known that infringing copies were available in “the Shop”.

50. Nor can the Applicant’s saying to undercover customs officer 8985 that Windows 7 was available in “the Shop” and one free disc would be given if the purchase was made with the promotional business card prove that the Applicant knew that infringing copies were available in “the Shop”.  The final successful purchase made by the customs undercover officer of six sets of infringing copies of “Microsoft” software optical discs for $500 also does not necessarily show that the Applicant knew that infringing copies were available in “the Shop”.

51. The evidence of undercover customs officer 98264 can be deemed the most unfavourable to the Applicant.  However, the Applicant’s saying to him that “Software and movie are available, 7 discs for $100”, and when being asked “What are the new movies”, her reply that “Many” also cannot prove that what the Applicant meant was 7 Software discs or currently showing movies discs could be available for $100, not to mention that what the Applicant expressed was 7 infringing copies could be available for $100.

52. There is no sufficient evidence to support what the trial judge said in paragraphs 49 and 50 of his Reasons for Verdict that the Applicant must have known the mode of operation of “the Shop” and the Applicant knew very well that the price of the optical discs was as low as 7 discs for $100 including currently showing movies.  What the Applicant referred to as 7 discs for $100 did not necessarily include the currently showing movies.  In fact, nor did the prosecution adduce any evidence to prove the reasonable price of a movie optical disc, be it the currently showing movies or the old ones.  

53. On the whole, we do not agree that the evidence adduced by the prosecution could lead to an irresistible inference showing that the Applicant knew that infringing copies were available in “the Shop”.

54. Mr. Tse contended that under section 118(1)(d) of the Copyright Ordinance, a person commits an offence if he, without licence, sells, lets for hire, or offers or exposes for sale or hire an infringing copy of optical disc regardless of whether he knew in the course of selling or hiring of the disc in question being an infringing copy.  Under section 118(3) of the Copyright Ordinance, if the person who sold or let for hire infringing copies of optical discs wants to put forward lack of knowledge as the defence, he has to prove that he did not know and had no reason to believe that the optical discs in question were infringing copies.  Mr. Tse was of the view that the Applicant had the evidential burden to raise the defence that she did not know and had no reason to believe that “the Shop” did sell infringing copies.  He emphasized that the Applicant did not raise such a defence, and according to the evidence of the prosecution, the Applicant at least had reason to believe that the optical discs sold in “the Shop” were indeed infringing copies.

55. The burden of proof provided in section 118(3) of the Copyright Ordinance, on the face of it, is only applicable to the offences stipulated under section 118(1) or (2A).  What we have to consider is whether section 118(3) of the Copyright Ordinance is also applicable to the conspiracy to commit those offences.  Since the Applicant is facing a conspiracy charge, this legal issue is very important and closely related to whether the Applicant is guilty or not.  At trial, counsel for the Applicant made submissions on the aforesaid issue, which, however, was not dealt with by the trial judge.  Nor did the counsel of both sides on this appeal dealt with that issue in their respective original written submissions, as a result of which we asked them to make supplemental written submissions to us after the hearing.  As a result, both sides further submitted to the court supplemental written submissions two weeks after the hearing stating their positions.

56. Mr. Tse’s original position was that as far as the burden of proof was concerned, there should not be any substantive difference between the approaches adopted for dealing with the offences stipulated under section 118(1) or (2A) of the Copyright Ordinance and the conspiracy to commit those offences.  Mr. Tse was of the view that the stipulation under section 118(3) was also applicable to the conspiracy to commit offences stipulated under section 118(1) or (2A).

57. We have reservations on the original position expressed by Mr. Tse.  For a person who directly takes part in selling or letting for hire infringing copies, since he will be directly in contact with the infringing copies in question, in order to combat offences of infringement, the law will, on the burden of proof, slightly depart from the conventional requirement that the prosecution has the burden to prove the guilt of the defendant by requiring the person who sold or let for hire infringing copies to prove that he did not know and had no reason to believe that what he sold or let for hire were infringing copies before he can be excused.  This is a reasonable approach which is supported by logical basis.

58. The offence of conspiracy is a preparatory / an inchoate offence.  When a conspirator enters into an agreement to commit an offence, it immediately constitutes the offence of conspiracy.  Regarding the offence of conspiracy to sell infringing copies of optical discs, when the agreement of selling optical discs was entered into, the optical discs in question still might not appear yet, and the conspirators also might not have an opportunity to be in contact with or directly deal with the optical discs in question.  Under the aforesaid circumstances, it is unreasonable, and also against the basic principle under the common law that the burden to prove the guilt of the defendant is on the prosecution, to require the defendant who is prosecuted for conspiracy to sell infringing copies to have the burden to prove that he did not know and had no reason to believe that the optical discs to be sold were infringing copies before he can rely on this as his defence and not to require the prosecution to prove that the defendant indeed knew that the optical discs in question were infringing copies.

59. If Mr. Tse’s original position is correct, then for a person who has entered into an agreement with another person for selling optical discs, if the optical discs sold in accordance with the agreement are later found to be infringing copies, then that person has to prove that he did not know and had no reason to believe that the discs sold were infringing copies before he can be excused.  We are of the opinion that the aforesaid approach is not appropriate.  We cannot ignore the fact that conspiracy (agreement) to sell optical discs by itself is not an unlawful conduct.  The optical discs which the defendant has agreed to sell must be infringing copies before it constitutes an offence.

60. We are of the opinion that the Applicant did not agree to commit any offence when she had an agreement with other persons to distribute business cards on the street promoting the selling of optical discs.  She should not have been found guilty because of other things which she did not know, namely, the optical discs sold were infringing copies.

61. The offence of conspiracy is a common law offence, the element of which is an agreement to carry out an unlawful conduct or an agreement to achieve a certain purpose by unlawful conduct.  The offence of conspiracy requires the support of mens rea. When the Applicant agreed with other persons to distribute business cards on the street promoting the availability of optical discs in “the Shop”, the Applicant’s conduct is not tendentious in terms of law and morals.  On the basis that the Applicant did not know that infringing copies were available in “the Shop”, her entering into an agreement with others to promote the selling of optical discs and the carrying out of the agreement is lawful.  The Applicant should not, for something which she did not know, have been made criminally liable or have been made to bear a burden of proof which she needs not have to bear in order to be excused of a criminal charge.

62. We do not agree with Mr. Tse’s original position.  We are of the opinion that in order to prove that the Applicant has committed the offence of conspiracy to sell infringing copies of optical discs, the prosecution must prove that when the Applicant and other persons had an agreement for promoting the selling of optical discs, she knew that infringing copies would indeed be available in “the Shop”.  According to our aforesaid analysis, the prosecution evidence cannot support the inference that the Applicant knew that the optical discs sold in “the Shop” included infringing copies.

63. In fact, after the hearing, Mr. Tse, when he submitted to the court a supplemental written submission at the request of the court, he changed his original position.  He conceded and agreed that when prosecuting a defendant for conspiracy to sell infringing copies of optical discs, section 118(3) cannot be relied on as the basis for conviction but there is a burden to prove that when the defendant reached an agreement with others to sell optical discs, they intended or knew that the optical discs agreed to be sold were infringing copies.

64. In R v Churchill [1967] 2 AC 224, the House of Lords dealt with a dispute arising from the aforesaid issue.  That case concerned what approach should be adopted for conspiracy to commit “absolute offence” or “offence of strict liability”.  When dealing with “absolute offence” or “offence of strict liability”, even if the defendant did not have mens rea, as long as he had done the act which constituted the offence, the court had to find him guilty.  However, the House of Lords ruled that the approach adopted for “absolute offence” or “strictly liability offence” was not applicable to conspiracy to commit those offences.

65. In Churchill mentioned above, in respect of the offence of “conspiracy to use heavy oil which has not been fully taxed”, the legal issue which had to be dealt with by the House of Lords was:

“whether mens rea is an essential ingredient in conspiracy to commit the absolute offence charged in court 2 of the indictment and, if so, what knowledge of the facts and / or law on the part of the defendant must be established to prove the charge.”

66. The House of Lords has the following detailed discussion in the judgment:

“The question is, ‘What did they agree to do?’ If what they agreed to do was, on the facts known to them, an unlawful act, they are guilty of conspiracy and cannot excuse themselves by saying that, owing to their ignorance of the law, they did not realize that such an act was a crime. If, on the facts known to them, what they agreed to do was lawful, they are not rendered artificially guilty by the existence of other facts, not known to them, giving a different and criminal quality to the act agreed upon.”

67. Churchill mentioned above was one of the factors leading to the United Kingdom amending in 1977 of its Criminal Law Act, the wordings of the provisions of which are the same as section 159A(2) of the Crimes Ordinance, Cap. 200 of the Laws of Hong Kong, which we set out in details as follows:

“Where liability for any offence may be incurred without knowledge on the part of the person committing it of any particular fact or circumstance necessary for the commission of the offence, a person shall nevertheless not be guilty of conspiracy to commit that offence by virtue of subsection (1) unless he and at least one other party to the agreement intend or know that that fact or circumstance shall or will exist at the time when the conduct constituting the offence is to take place.”

68. Putting it in simple terms, in the present case, to find the Applicant guilty of conspiracy to sell infringing copies of optical discs, the prosecution had to prove that when the Applicant reached an agreement with others to sell optical discs, she intended or knew that the optical discs to be sold under the agreement were infringing copies.

69. Regarding the approach of interpreting the aforesaid words “intended” or “knew”, in R v Saik [2007] 1 AC 18, Lord Nicholls of the House of Lords has the followings to say in paragraph 26 of the judgment:

“… The phrase under consideration (‘intent or know’) … is a provision of general application to all conspiracies. In this context the word ‘know’ should be interpreted strictly and not watered down. In this context knowledge means true belief.”

70. In paragraph 6 of the same judgment, Lord Nicholls pointed out clearly that regarding the provision in question (that is, section 159A(2) of the Crimes Ordinance), its essential purpose is to ensure that strict liability and recklessness have no place in the offence of conspiracy.

71. In the above circumstances, the prosecution could not rely on section 118(3) of the Copyright Ordinance to support the conspiracy charge against the Applicant, and Mr. Tse no longer disputed this in his supplemental written submission.

72. According to our analysis, there is no sufficient evidence to support the inference drawn by the trial judge that the Applicant knew that what were sold in “the Shop” were infringing copies of optical discs.  When the prosecution had failed to prove that the Applicant knew that infringing copies were available in shop, the Applicant’s conviction on conspiracy to sell infringing copies is unsafe and unsatisfactory.

73. We grant leave to the Applicant to appeal against conviction, and treating the application as appeal proper, we allow the appeal and quash the conviction against her and the sentence imposed.

Translated by the Judgment Translation Unit of the Judiciary and vetted by Mr. P. Y. Lo, Barrister-at-law.