HKSAR v. YEUNG CHIU

[English Translation – 英譯本]

CACC 105/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 105 OF 2009

(ON APPEAL FROM DCCC NO. 460 OF 2008)

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REASONS FOR JUDGMENT

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Hon Cheung JA (giving the Reasons for Judgment of the Court):

Charges

1. The applicant was charged with eight charges. After trial before Deputy District Judge Johnny Chan, the applicant was found guilty of six of them. The six charges were:

(1) The first charge: Conspiracy to defraud, contrary to common law;

(2) The fourth to eighth charges: Theft, contrary to section 9 of the Theft Ordinance.

2. The applicant also pleaded guilty to the second charge, namely, a charge of furnishing false information, contrary to section 19(1)(b) of the Theft Ordinance, Cap. 210. He only pleaded guilty to the charge on the fourth day of the trial and he did not agree to the facts presented by the prosecution in relation to that charge. Deputy Judge Chan had to continue hearing evidence for that charge. At the conclusion of the hearing, Judge Chan rejected the applicant’s version.

Appeal against sentence

3. Deputy Judge Chan sentenced the applicant to a term of imprisonment for 4 years and 6 months. The individual term of imprisonment imposed by Deputy Judge Chan on each charge was as follows: 18 months for the first charge; 38 months for the second charge; 12 months each for the fourth to sixth charges and the eighth charge; 8 months for the seventh charge. 10 months out of the term of imprisonment on the first charge were to run consecutively to the 38 months imposed on the second charge. The sentences imposed on the fourth to eighth charges were to run concurrently but 6 months out of them were to run consecutively to the terms of imprisonment imposed on the first and second charges.

4. The applicant applied for leave to appeal against the sentence. After hearing, we allowed the application and, treating the application as the appeal proper, altered the total term of imprisonment to 3 years and 9 months.

5. The applicant had originally also applied for leave to appeal against conviction but abandoned the said application on the day of the hearing. We dismissed the said application accordingly.

The prosecution’s case

6. The first prosecution witness (“PW1”) was in the yarn business and operated a business called “Golden A Yarn Factory” (“Golden A”). The applicant and the third defendant in the case ran a business called “Tak Shun Weaving Factory” (“Tak Shun”). PW1 had business dealings with Tak Shun. In 1998, Tak Shun was wound up and closed its business. It owed Golden A some payments for goods in the region of over $1 million. The applicant was adjudged bankrupt by the court.

The first charge

7. After Tak Shun was wound up, the applicant suggested to PW1 that they should enter into partnership to run another weaving factory, i.e. the “New Tak Shun Weaving Factory” (“New Tak Shun”), so that the applicant and the third defendant could make repayments to PW1 by means of the profits from the business. Since the applicant was a bankrupt, the second defendant in the case was invited to join as a shareholder of New Tak Shun to represent the interests of the applicant and the third defendant. The two other partners of New Tak Shun were PW1 and a Mr. Wong. After the inception of New Tak Shun, the applicant set up another business of the same name of “New Tak Shun Weaving Factory” (“fake New Tak Shun”) without the knowledge of PW1. The applicant deposited the cheques, which were given to him by the customers of New Tak Shun in favour of New Tak Shun for payment of goods, into the bank accounts of fake New Tak Shun. The amounts involved were approximately in excess of $300,000. PW1 went after the applicant. Subsequently, the applicant’s mother had to sell a property and repaid for the applicant a sum of about $290,000 to PW1.

The second charge

8. After the incident of fake New Tak Shun came to light, New Tak Shun ceased its business. But during March and April 2000, the applicant again persuaded PW1 to establish another company which would be run by him and he would make use of its profits to repay the debts to PW1. The company was called “Kam Fook Garment Accessories Company Limited” (“Kam Fook”).

9. In November 2003, PW1 discovered that some amounts of money, which were deposited into Kam Fook’s account, came from two companies which had no business dealings with Kam Fook. PW1 found it suspicious and enquired of the applicant about it. The applicant had in fact sold goods in the name of Kam Fook to customers through those two companies. In order to hide the fact, the applicant showed PW1 some payment invoices issued to customers by Kam Fook, 21 of which contained some non-existent sales information, involving a total amount which approximately exceeded $1,300,000. The applicant had pocketed the money himself.

10. Regarding the second charge, the applicant admitted that the relevant invoices were false. But he claimed that those invoices were provided to PW1 upon the latter’s request for the purpose of filing the tax returns, or for the purpose of offsetting the sale of goods to Kam Fook by Golden A. Deputy Judge Chan rejected the applicant’s version of events.

The fourth to eighth charges

11. Between 15 September and 10 December 2004, the applicant had even stolen sums of money paid to Kam Fook by its customers, the total sum of which was approximately $79,500.

Sentencing guidelines

12. In sentencing, Deputy Judge Chan had considered the sentencing guidelines laid down by the Court of Appeal on an offence of theft involving a breach of trust in HKSAR v Cheung Mee Kiu [2006] 4 HKLRD 776 and HKSAR v Ng Kwok Wing [2008] 4 HKLRD 1017. The sentencing guidelines laid down in Cheung Mee Kiu and Ng Kwok Wing are as follows:

13. We would reiterate here that Ng Kwok Wing has not enhanced the ranges of sentence laid down in Cheung Mee Kiu but has only made a more logical adjustment to the ranges of sentence involving the same amounts of money. For example, the range of sentence for the band 3 amounts, i.e. between $1,000,000 and $3,000,000, in Cheung Mee Kiu is 3 to 4 years while the range of sentence is 5 to 9 years for the band 2 amounts of between $3,000,000 and $15,000,000. If looking at the figures only, for the same amount of $3,000,000, the sentence is 4 years and 5 years respectively. We do not think this was the intent of the Court of Appeal in Cheung Mee Kiu. Therefore, the Court of Appeal has unified the relevant ranges of sentence in Ng Kwok Wing so that the maximum sentence of the lower band matches the minimum sentence of the upper band.

Our opinion

14. In the present case, all three sets of charges were either an offence of theft involving a breach of trust or an offence with such background. Therefore, the sentencing guidelines laid down in Cheung Mee Kiu and Ng Kwok Wing are of substantive cross-reference value in the consideration of whether the ultimate sentence passed by Deputy Judge Chan was in line with the relevant sentencing guidelines. Under the guidelines, the range of sentence for amounts of money between $1,000,000 and $3,000,000 is 3 to 5 years’ imprisonment. On this basis, for an offence which involved an amount of money not exceeding $2,000,000, the term of imprisonment should be 4 years or less. The amount of money involved in the present case is about $1,700,000. If one just looks at the figure, the sentence of 4½ years’ imprisonment passed by Deputy Judge Chan far exceeds the range of sentence set by the guidelines. We agree that sentencing guidelines are not some sort of straitjacket and the court may make adjustment in accordance with the particular facts of the case heard by the court. But we are of the opinion that the extent of the adjustment should not depart excessively from the range of sentence set by the guidelines. Under the facts of the instant case, including the amount of money involved, the time and the mode of the commission of the crime, the sentence after trial, in our view, should be one of 4 years’ imprisonment. But since the applicant pleaded guilty to the second charge, he should be entitled to some reduction in the sentence. So we are of the view that the appropriate sentence should be 3 years and 9 months’ imprisonment. We would adopt the individual sentence passed on each charge by Deputy Judge Chan. We would also agree with the discount of 4 months (about 10% of a starting point of 42 months) given by Judge Chan in respect of the sentence on the second charge: the applicant only pleaded guilty halfway in the trial and his version of the facts was not accepted by Judge Chan in the end, so his plea of guilty did not substantively save the time of the trial. We would order that 4 months out of the sentence on the first charge should run consecutively to the sentence of 3 years and 2 months imposed on the second charge, the sentences imposed on the fourth to eighth charges should run concurrently but 3 months out of them should run consecutively to the sentences passed on the first and second charges, making a total sentence of 3 years and 9 months’ imprisonment.