HKSAR v. LEUNG WAI SHAN

CACC 515/2001
& CACC 521/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NOS. 515 OF 2001 & 521 OF 2002

(ON APPEAL FROM DCCC 202 OF 2001)

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CACC 515/2001

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J U D G M E N T

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Stuart-Moore VP (giving the judgment of the Court):

CACC 515/2001

1. The Applicants in CACC 515/2001, (D2 to D8 and D10 respectively), variously seek leave to appeal against sentence or to have their previous abandonment of applications for leave to appeal against sentence treated as a nullity. Some pleaded guilty on 3 October 2001 and others were convicted after trial on 23 October 2001 in relation to a joint charge of conspiracy to defraud with D9, D11 and D12.

2. The facts and background of the case are set out in full in the judgment (also CACC 515/2001) given on 5 December 2002, when the sentence appeals of D9 and D11 were allowed. We observed on that occasion that the result of those appeals would "almost inevitably" have an effect on the remaining defendants although, without more precise information, we were at that time unable to be sure about this. In any event, we invited late applications from these Applicants to make sure that none of them had suffered any injustice.

3. The issue involved in all these applications is the same as it was for D9 and D11. It has been encapsulated in the grounds of appeal which effectively allege that because Deputy Judge Dufton was inadvertently misled by evidence called on behalf of the prosecution into believing that the offence was 'prevalent', there was an error of principle when, as a consequence, the judge enhanced the Applicants' sentences under the provisions of the Organised and Serious Crimes Ordinance (OSCO), Cap 455.

4. It is unnecessary, in the light of the earlier judgment given in this matter to rehearse any of the details of the case. Suffice it to say, this was a 'Loco London Silver' fraud in which all of those charged had acted out a role which was intended to persuade gullible members of the public to 'invest' in what was, in reality, a wholly bogus company calling itself Link Legend Enterprise Limited.

5. There is no suggestion that the starting point for sentence adopted in any Applicant's case was manifestly excessive. The sole issue is whether it was right to have enhanced all or any of their sentences by 25%.

6. It is plain, following our decision on 5 December 2002, that if the judge had not been misled, which we stress was done entirely inadvertently, these sentences would not have been enhanced. No criticism whatever was made of the sentencing judge in the earlier judgment. He merely proceeded on the undisputed material with which he had been provided. The same applies in these applications.

7. We propose in the highly unusual circumstances which have arisen, where those Applicants who understandably took the legal advice they had been given, and who then abandoned their applications, to treat each abandonment as a nullity and to give leave to appeal against sentence. As to the remaining applications, all of which are long out of time, we shall also give leave to appeal against sentence.

8. Treating the hearing as the appeal, the sentences will in each case be reduced in order to remove the element of enhancement. The reasoning for this is precisely the same as it was in our earlier judgment in CACC 515/2001 (paragraphs 33-35 and 45-46) which was as follows:

"33. Mr Choy's submission was that D9 and D11 had received enhanced sentences under section 27(11) of the Organised and Serious Crimes Ordinance, Cap. 455 (OSCO) wholly as the result of the statistics provided in a statement to the judge by Chief Inspector Chan which showed a steady increase, between 1997 and 1999, in the number of cases of the kind with which we are presently concerned. However, Mr Choy submitted that when the Chief Inspector was called to give statistical evidence as to 'prevalence' in a slightly later case in which Mr Choy as it so happens had appeared for the defence (DCCC 446/2001) which concerned another scam involving almost identical allegations, the Chief Inspector was able to "clarify" that the statistics referred to in his statement actually showed a decrease in the number of cases since 1999.

34. Mr Choy argued that the decrease in the number of cases since 1999 meant that the offence was no longer one which could properly be described as 'prevalent' in November 2001 when D9 and D11 were sentenced. In essence, it was his submission that the judge in the present case had not been given the "clarification" which Judge D. Pang in DCCC 446/2001 had received, and that, looked at in this light, the prosecution should not have been seeking any enhancement of sentence in the present case. This happens also to have been the view taken by the judge in DCCC 446/2001 when he declined, after the position had been clarified, to enhance the sentence of any of the defendants in that case.

35. Obviously, if Mr Choy's submission was correctly formulated, the judge would have been unwittingly misled into thinking in the present case that the offence was one which was 'prevalent' within the meaning of section 27(2) of OSCO but we did not need to make a ruling on the admissibility of the additional evidence. The material which it had been proposed should be received in evidence became unnecessary when, without warning, and contrary to Ms Shine's lengthy written argument in support of the correctness of the passing of enhanced sentences in the present case and where, additionally, she had sought to exclude the additional evidence which Mr Choy wished to adduce, Ms Shine announced that she now conceded that the prosecution had been wrong to seek any enhancement of sentence......

45. Returning to the element of enhancement which the prosecution had invited the judge to consider, the judge was not specifically informed, as the sentencing judge in DCCC 446/2001 had been, that the offence with which he had to deal in 2001 was now on the decrease. If he had been, we think that it is more than likely that he would have arrived at the same conclusion which Judge D. Pang reached in DCCC 446/2001. Whilst, in one sense, offences of this kind might be regarded as prevalent because they were still commonly being practised, we do not consider that it can have been the purpose of this particular legislation to impose an additional punitive sentence on an offender, which is specifically designed to deter others, once the offence in question has been shown to have substantially declined in numbers. In saying this, we are aware that this may leave open a somewhat arbitrary basis for sentencing about which sentencers should be aware. For example, if one of the defendants in the present case had been arrested before the others could be found, and had pleaded guilty straightaway, that defendant might well have been liable to receive an enhanced sentence at a time when the offence was still prevalent. On the other hand, these Applicants and their co-defendants, following a lengthy investigation, were not sentenced until about two and a half years after the conspiracy ended, by which time we think it was stretching the meaning of 'prevalence' to say that the offence still fell into such a category.

46. The power to enhance a sentence under section 27(11) is an extraordinary power. It enables a judge, as we have set out already, to pass a more severe sentence for a specified offence if one or more of a number of factors itemised in section 27 of OSCO has been established. We think that the power given to a judge to add to the sentence he has otherwise considered to be appropriate, which will often already have incorporated an element for deterrence, can only have been intended to spell out to others who might otherwise commit the same type of offence in the future that to do so will entail a particularly severe penalty. Inevitably, it is a power which ought to be utilised sparingly."

9. In the result, therefore, all of the present appeals must be allowed.

10. D2, D4, D5, D7 and D10 were each given, following their pleas of guilty, a starting point of four years' imprisonment reduced to thirty-two months before enhancement by 25% to forty months. Their sentences will now be reduced from three years and four months to two years and eight months' imprisonment in each case.

11. D6 (and D11) were convicted after trial. The judge again adopted a starting point of four years' imprisonment before enhancement by 25%. D11's sentence was reduced on 5 December 2002 from five years to four years' imprisonment. D6 was in precisely the same category and his sentence will therefore be reduced to four years' imprisonment also.

12. D3 pleaded guilty and his starting point for the purposes of sentence was four years reduced to thirty-two months and then enhanced by 25% to three years and four months. However, because D3 was by then serving a four-year term for completely separate triad-related offences, amongst others, the judge imposed a partially consecutive sentence, to the extent of twenty-eight months only. This represents 70% of his sentence for the present offence to be served consecutively. We shall reduce D3's sentence to two years and eight months, and by ordering that twenty-two months of his sentence should run consecutively to his earlier four-year sentence, the overall length of the sentence he is to serve will thereby be reduced by six months.

13. Turning lastly to D8, the starting point adopted in her case was four and a half years' imprisonment. She had been on bail for a similar offence when she committed the present offence. Reduced to three years' imprisonment for her plea, after a 25% enhancement she received a total of three years and nine months' imprisonment. However, as D8 was already by then serving a sentence of two years' imprisonment for a similar fraud, the judge ordered that only thirty months of the sentence he imposed for the present offence, representing approximately 67% of the total, should run consecutively to the two-year term. Applying the same approach as the judge, after removal of the 25% enhancement to her sentence, leaving three years' imprisonment, we shall order that twenty-four months of D8's sentence should run consecutively to the two-year sentence she was already serving. This represents a reduction of six months' imprisonment to the term she is serving.

CACC 521/2002

14. Turning to CACC 521/2002, if it was not for the fact that this Applicant (D12 at trial) had not jumped her bail and been dealt with separately, she would have been dealt with together with all the other applicants in CACC 515/2001. On 5 December 2002, we provided the reasons in the cases of D9 and D11 for allowing their appeals against sentence, which gave rise to precisely the same point which has arisen in the present case and the other appeals with which we have just dealt in CACC 515/2001.

15. This is a late application for leave to appeal against a sentence of three years and four months imposed by Judge Wesley Wong in the District Court on 8 August 2002. We propose, for the same reason which was expressed in full in the judgment in CACC 515/2001 given on 5 December 2002, to give leave out of time and to treat the hearing as the appeal.

16. Judge Wong, in his Reasons for Sentence, said as follows:

"1. I have carefully considered everything your lawyer has said on your behalf and the letters from your relatives and a letter from a Legco member. After reading the Legco member's letter, he just reiterated what your lawyer has told me. It is just a waste of his time and my time.

2. I pity you in respect of having such a family background and that you have been dutiful. But on the other hand, this is a well-organised scheme to milk those uneducated poor people from the lower income bracket of their hard-earned savings. Your lawyer told me that you wanted to get money to pay for the flat that your family lives in. Have you ever thought what would happen to your family if your family savings had been cheated?

3. This sort of conspiracy is prevalent and an enhanced sentence has been sought by the prosecution. The trial judge had considered and imposed a 3 year 4 month imprisonment sentence after the enhancement of sentence.

4. There are actually no mitigating factors, save for your plea of guilty which saved the court's time and public money and that you have shown remorse. I cannot give you the usual one-third discount because you have jumped bail.

5. So I take a starting point of 3 years and 4 months, give you a one-quarter reduction and sentence you to 30 months."

17. The starting point in all the other cases adopted by Deputy Judge Dufton had been four years' imprisonment reduced to thirty-two months' imprisonment for those who had pleaded guilty, not as the judge in the present case stated, three years and four months' imprisonment. It seems, however, that eventually counsel for the prosecution pointed out the error to the judge and Judge Wong went on to say:

"Having heard the prosecution, I will adopt the sentence of the trial judge, that is 3 years enhanced by another 4 months so that there is no disparity between the other defendants."

18. It goes without saying that this also was not an entirely accurate statement. In addition, whilst parity of sentence between defendants is usually desirable, D12 had absconded on bail and a 25% discount was the very most she could expect in order to distinguish her from her co-defendants who had entered timely pleas of guilty, all of whom received a one-third discount.

19. We propose, in the light of these errors, to look at sentence once again following the guidelines in HKSAR v Tam Wai-pio [1998] 4 HKC 291, [1998] 2 HKLRD 949, which unfortunately the judge failed to do. We take a starting point of four years' imprisonment, the same in other words as that which was adopted by the original trial judge for all the others. Reduced by 25%, to take into account the late plea of guilty, the sentence is then reduced to thirty-six months. Any enhancement of sentence, as we have said in the earlier judgments in CACC 515/2001, was inappropriate in the somewhat unusual circumstances which had arisen.

20. The sentence to be served by D12 should therefore be three years' imprisonment which represents a reduction of four months in the sentence she is serving. To this extent, the appeal is allowed.