THE QUEEN v. CHAN KAM SAM

IN THE COURT OF APPEAL

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JUDGMENT

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Silke, J.A.:

1. The applicant, Chan Kam Sam, was charged in the District Court with causing or procuring the transfer of property upon a forged document, an offence contrary to section 75 of the Crimes Ordinance.

2. The Particulars of that offence were stated as:

"         CHAN Kam-sam, on or about the 7th day of July 1983, in Hong Kong, together with persons unknown, with intent to defraud, caused or procured to be transferred from the Hong Kong Metropolitan Bank Limited to an account with the said bank in the name of Fu Tai Enterprises the sum of $716,047.50 Hong Kong currency under, upon or by virtue of a forged instrument, namely a debit voucher dated the 7th day of July, 1983 numbered 050/230684/0, knowing the same to be forged."

3. He was convicted after trial and sentenced to a term of 4 years imprisonment. He now seeks leave to appeal against both his conviction and sentence.

4. It was the case for the Crown that the applicant together with others, including the witnesses Chan Ping and Chan Kwok Wah, carried out the fraudulent transfer. They relied mainly on the evidence of the accomplice Chan Kwok Wan together with the evidence of Chan Ping, also an accomplice, the use of a typewriter to which the applicant had access and which was used to type the forged documents and certain cheques and an entry in the applicant's diary relating to the Fu Tai Enterprises.

5. Fu Tai Enterprises was registered as a trading company on the 10th June 1983 and the signature on the application form was that of Chan Ping. On the 21st June 1983 Chan Ping opened a current account with the Admiralty Centre of the Hong Kong Metropolitan Bank and this account was in the name of Fu Tai Enterprises. He collected two cheque books from that branch of the bank some two weeks after the opening of the account. On the 7th July that branch received a debit and credit voucher. Both of these documents were forged. They were for the internal use of the bank. The debit voucher bore the forged signature of Mr. Yaw, a bank officer, and the forgery was a good one. None of these facts were disputed.

6. In the normal course, these documents would nave come from the Bills Department of the bank after proper checks had been carried out as to the documentation relating to them such as Letters of Credit.  Once they are issued, the bank staff automatically act upon them without any further check. The debit voucher caused the branch's account with Head Office to have the sum referred to in the credit voucher debited against it. Once done the credit voucher automatically credited Fu Tai account with the sum of $716,047.50. On the face of these two documents' this was a normal discounting of a Letter of Credit.  It was only much later, when enquiry was raised, that it was found that no documentation was in the bank's hands. It seems clear that the vouchers were introduced into the banking system by someone who was well aware of that system and who was familar with the signature of Mr. Yaw.  Who this person was we do not know.

7. Again it was not in dispute that Chan Ping had opened a personal account with the Hang Seng Bank. On the 7th July two cheques were drawn on the Fu Tai Enterprises' account and in favour of Chan Ping in the sums of $400,000 and $300,000.   These cheques were, on the same day, deposited in the Hang Seng account of Chan Ping; on the 8th July Chan Ping withdrew $690,000 from that account. Oh the 11th July, he withdrew a further $10,000.

8. Chan Kwok Wan gave it in evidence, and he was on police bail in relation to the charged offence at the time he gave that evidence and was without an immunity, that he had met the applicant on a number of occasions; that the applicant had suggested to him that he registered Fu Tai and opened the account in its name but, as he was a "green card" holder, the applicant then said he should not be the person himself to do it but that he should obtain the services of a "black card" holder. This advice led him to engage Chan Ping, a 61 years old, illiterate coolie, to perform those functions. He had assisted Chan Ping and after the money was in Chan Ping's account at the Hang Seng Bank, had helped him to withdraw it and had carried it to a meeting place with the applicant in an attache-case and had there handed it over to the applicant.

9. Chan Ping, in his evidence, stated he had never met the applicant and merely did what he did on the instructions of Chan Kwok Wah. As most of the details of his evidence were contained in the agreed facts, he was not seriously challenged.

10. The Crown proved, and again this is not challenged, that the forged debit note and most probably the forged credit voucher were typed on a typewriter found in December 1983 in the office operated by the applicant. They also proved that the two cheques to which I have referred were typed on the same machine.

11. The applicant's office was in Flat A, 2nd Floor, Tin Lok Lane. In Flat B on the same floor operated the Sun Ming Enterprises. It was clear floor evidence of defence witnesses that the typewriter, on the material dates, was in the Sun Ming office. It only came into the applicant's office by the fortuitous chance of a broken typewriter in that office and its being borrowed to replace it. This is late August or September 1983. There was evidence that the wife of the applicant was a director of Sun Ming and that the applicant and his wife had a shareholding in the business. The trial judge found, rightly, that the applicant had access to the typewriter in Sun Ming at the relevant period. The Crown was unable to prove who actually typed the documents.

12. At the same time as the seizure of the typewriter, there was also seized a diary which was the property of the applicant. In that diary under the date of the 6th June - some 4 days before the registration of Fu Tai - there was an entry stating "Get Fu Tai Enterprises B.R.". In his evidence at trial, the applicant attempted an innocent explanation for this entry. Mr. Eddis, with him Mr. Chan, who appeared for the applicant in this Court acknowledged considerable difficulty in attempting to justify that explanation which was that the applicant had considered setting up such a company with his girl friend but had done nothing further about it. The coincidence was somewhat too great.

13. Mr. Eddis has advance a number of grounds of appeal of which three have given us some concern. The first of those grounds - ground(1) in the Definitive Grounds of Appeal - reads:

"The learned Trial judge erred in law by failing to direct himself adequately or at all to the burden of proof necessary to secure a conviction in relation to the several material ingredients of the alleged offence."

14. This ground is based on the following passage in the Reasons for Verdict of the trial judge:

"From these admitted facts and from the evidence of Chan Kwok Wah and Chan Ping it is reasonable to infer that the Defendant, together with others unknown, caused the fraudulent transfer ......"

The two other grounds are grounds (2) and (5) which impinge one upon the other. Ground (2) suggests that the trial judge erred in law and in fact by holding that

"Chan Kwok Wah's evidence is supported by the evidence of Chan Ping"

and the fifth ground suggests that various discrepancies in the evidence of Chan Kwok Wah were such as to render that evidence totally unreliable. On this ground, Mr. Eddis urges us to hold that Chan Kwok Wah was so incredible that he could not be believed and in turn could not be corroborated.

15. Dealing with the issue of "reasonable inference" first. In the useful written final speeches which were placed before him both by counsel then appearing for the Crown and by counsel then appearing for the applicant, the trial judge had his attention drawn in the latter to the well known passage in Kwan Ping Bong v. R. ⁽¹⁾ in which Lord Diplock referred to inferences and said the inference of guilt

"must be compelling - one (and the only one) that no reasonable man could fail to draw from the direct facts proved."

It is a valid criticism that nowhere in his Reasons for Verdict did the trial judge makes specific reference to the burden and standard of proof. That criticism is underlined by his use of the phrase "it is reasonable to infer". It permits counsel validly to raise the issue that he has misdirected himself. But we also accept that a District Judge is not under an obligation to address himself as fully as if he were delivering a summing up to a jury.  We are, we think, entitled to assume that he is aware of where the burden lies and of the standard of that burden. Here, he had believed Chan Kwok Wah. Given that belief, together with the evidence of the admitted facts and the evidence relating to the typewriter and the diary it would certainly be "reasonable to infer" that the applicant did cause or procure the fraudulent transfer. If he had inserted the word "only" before the word "reasonable" in the passage to which we have referred, Mr. Eddis concedes that the point he makes would not have been open to him.

16. We think that the trial judge was guilty at worst of the use of too loose a phraseology. Reading his reasons as a whole, he had clearly come to the conclusion that guilt had been proved beyond doubt. A conclusion to which he was fully entitled to come. We are fortified in the view we take by that which was said by another division of this Court in Chan Shui Sing and another v. The Queen. ⁽²⁾ In the circumstances, accepting that the criticism has some validity we do not think that this verbal lapse of the trial judge is sufficient to provide a reason to vitiate the conviction.

17. As to the credibility of Chan Kwok Wah, the trial judge had sight of him.  He was aware of the nature of the witness. He warned himself that he was an accomplice and he further warned himself that he should use even greater caution since he was giving evidence without having been given any immunity by the Crown.  Having read the transcript and considered the Reasons for Verdict, we are of the view, that the judge was entitled to consider Chan Kwok Wan as a witness capable of telling the truth and, in turn, capable of being corroborated. This is not to overlook the two distinct matters which Mr. Eddis has drawn to our attention. First the matter of the paging machine and the variations in Chan Kwok Wah's evidence as to when he bought it and the defence evidence, documentary and oral, on the matter. Second the matter of the payment to Chan Ping. That payment had been stated first of all by Chan Kwok Wah to have been $50,000 paid for "office use".  He later changed that to a payment of $45,000, he having kept, on foot of an arrangement between Chan Ping and himself, $5,000. Chan Ping stated that he was paid but $17,000. Nor are we unaware in this connection that according to himself, Chan Kwok Wah, who played a far greater role in this matter than did the elderly Chan Ping, would seem to have received, if he is to be believed, a very much lesser sum.

18. It is again unfortunate that the trial judge did not directly refer to either of these doubtful areas in the course of coming to his conclusion. But that having been said, this Court would be slow to interfere, unless he has been shown to be entirely wrong, with a trial judge's view of the credibility of witnesses who appeared before him.

19. We do not think that the criticism leveled against the manner in which the trial judge evaluated the credibility of Chan Kwok Wah while having some validity, to be sufficient for us to say that he was wrong in the conclusion to which he came.

20. It is the third issue, that is the supporting of Chan Kwok Wah's evidence by making reference to the evidence of Chan Ping which has given us the greatest difficulty.

21. It is clear, and Mr. Lugar-Mawson with his usual fairness has so conceded, that Chan Ping was an accomplice.  It is trite law to say that the evidence of one accomplice cannot corroborate the evidence of another. The trial judge does not appear to have directed his mind to this aspect. For he said this:

"Chan Kwok Wah's evidence is supported by the evidence of Chan Ping and also by the fact that the forged debit voucher was typed on a typewriter found in the Defendant's office."

I would interpolate that he makes it clear later that he was fully aware that the typewriter was not in the office at the relevant time but was one to which the applicant had access.

22. He went on:

"Chan Kwok Wah's evidence is further supported by a diary found in the Defendant's office in which an entry was found, at the date 6th June 1983, saying 'get Fu Tai Enterprises B.R.'."

23. It will be noted that in each of these cases, he used the word "supported". He was, correctly, seeking corroboration. The typewriter and the diary could both be considered to be matters of independent evidence implicating or tending to implicate the applicant in the crime and its commission. Chan Ping is another matter. The effect of Chan Ping's evidence was really to give life to the admitted facts. The only further effect of it was that he said that which he did was under the direction of Chan Kwok Wah. It is only if Chan kwok Wah is to be believed that the applicant is shown to have been the mover behind the scene. Chan Ping was not aware of his existence.

24. In the D.P.P. v. Hester, ⁽³⁾ Lord Diplock at page 244, in considering corroboration, had this to say:

"What is looked for under the common law rule is confirmation from some other source that the suspect witness is telling the truth in some part of his story which goes to show that the accused committed the offence with which he is charged."

And in the three main corroboration cases, that is Hester, ⁽³⁾ Kilbourne ⁽⁴⁾ and Boardman, ⁽⁵⁾ in the observations of their Lordships where the word "support" is used, they clearly refer to corroboration. The word "support" has been given greater prominence in Thorne & others ⁽⁶⁾ and Virgo ⁽⁷⁾ and this has caused some controversy.  But we think the essence is that only evidence within the definition of corroboration in Baskerville ⁽⁸⁾ is evidence which can assist in confirming the evidence of a suspect witness as to the implication of an accused. Though other evidence may well, if it is believed, and is consistent with that of the suspect witness, be thought by a judge or jury to aid in the assessment of his general credibility. Nevertheless it is dangerous for a judge to direct a jury, on the issue of corroboration, by the use of the expression "supporting evidence":

25. That being so, the use by the trial judge here of the word "support" covering not only the evidence of Chan Ping but also the evidence which was corroborative in the strict sense was unfortunate. The evidence of Chan Ping did, as we have said, go little further than the evidence of the agreed facts. The danger of the manner in which the trial judge dealt with it is that he gives the impression of having found in it corroboration of that part of the evidence of Chan Kwok Wah, wherein the latter implicated directly the applicant, although the evidence of Chan Ping did nothing of the sort.  We asked ourselves did the judge fortify his view of the truthfulness of that part of Chan Kwok Wah's evidence by using as corroboration something which was not?

26. The effect of the trial judge using the phraseology he did was to elide the two concepts to which we have referred. This amounts to a misdirection. The case for the Crown was a strong one. The applicant's blank denial and unbelievable explanation were rejected by the trial judge and he was entitled to take that view.

27. We do not think the undoubted misdirection was such as to occasion any miscarriage of justice and that this is one of those cases in which the proviso can be properly applied.

28. The application for leave to appeal against conviction is granted but treating the hearing of that application as the appeal we dismiss the appeal.

As to sentence

29. The sentence passed was one of four years imprisonment and in passing it, the trial judge said he, that is the applicant, is the only person before the Court and he must now bear "the full blame". It had been submitted to us by Mr. Eddis that the sentence should be based on an appreciation of the applicant as a messenger boy rather than as the prime mover. On the evidence before the trial judge, the applicant was the last recipient of this money. He was clearly deeply involved in the fraudulent transaction albeit there were others who were also engaged. He was no messenger boy.

30. He had a clear record, a matter which the judge took into consideration. We do not considered that the sentence of four years imprisonment in the case of this nature after trial to be manifestly excessive. In those circumstances, we would refuse the application in respect of sentence.

(1)    [1979] H,K.L.R. 1 (P.C.)

(2)    [1980] H.K.L.R. 310

(3)    [1973] 57 Criminal Appeal Reports 212

(4)    [1973] 57 Criminal Appeal Reports 381

(5)    [1975] 60 Criminal Appeal Reports 165

(6)    [1978] 66 Criminal Appeal Reports 6

(7)    [1978] Criminal Law Review 557

(8)    [1916] 2 K.B. 658