HKSAR v. DAVID WU

HCMA76/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

(Appellate Jurisdiction)

MAGISTRACY APPEAL NO.76 OF 2000

(ON APPEAL FROM ESCC 2435 OF 1999)

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J U D G M E N T

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1. The appellant was convicted on 25 November 1999 of one charge of conspiracy to defraud contrary to Common Law and was fined the sum of $30,000 on 2 December 1999. He now appeals that conviction.

2. The particulars of the offence were that the appellant, between 1 February 1995 and 13 January 1999, in Hong Kong, conspired with Sydney Trentham Cunningham ("Cunningham") to defraud the Hong Kong Jockey Club ("the Club"), by dishonestly:

(1) withholding from and failing to inform the Club that the appellant's interest in a racehorse to be imported into Hong Kong from overseas (subsequently known as "Vintage"), in an application for a Horse Import Permit signed by Cunningham and submitted to the club;

(2) causing and permitting the Club to award a Horse Import Permit to Cunningham;

(3) causing and permitting the Club to register Cunningham as the sole owner of the said racehorse "Vintage"; and

(4) withholding from and failing to inform the Club, subsequent to the racehorse's arrival in Hong Kong, of the appellant's interest in and control of the said racehorse "Vintage".

3. The prosecution conceded that the date of the formation of the conspiracy was in or about February 1995, that the interest in respect of items (1) and (4) of the particulars of the offence meant "ownership", and that "control" in item (4) meant instructions given to the trainer on how to run "Vintage" in a race.

4. Cunningham referred to in the charge joined the Jockey Club as a racing member in 1980. He was a senior immigration officer in the Hong Kong Government and had known the appellant for over 20 years. In February or March 1995, the appellant came to Cunningham's office on an immigration matter. Also present was a Mr. Gregory Chung. During the meeting, the appellant asked Cunningham and Mr Chung if they are members of the Jockey Club and, being told that they were took out two blank application forms for a horse import permit. This is an application to join a ballot to be awarded permission to import a horse for racing in Hong Kong. Only horses imported with such permission and trained within the rules of the Jockey Club may race in Hong Kong. All members who were eligible and who applied would be placed in that ballot. Cunningham signed the blank application form and the form was handed back to the appellant. At the time, Cunningham asked what would happen if he succeeded in the ballot since he had never owned a racehorse and knew little about being an owner. The appellant told him that the appellant would make all the arrangements. Cunningham's understanding was that the appellant would buy the horse and take care of all expenses, arrange to purchase it and select the trainer. The appellant arranged the submission of the form to the Jockey Club without any further reference to Cunningham who took no interest in the outcome of the ballot. The form was produced and contains solely the particulars of Cunningham as the proposed importer and owner.

5. The form upon which application was made to enter the ballot for an import permit contained, inter alia, these terms:

"4. I hereby declare that the under-mentioned list of members are the only persons interests in this application and that they are in any way qualified to take part in this draw in terms of Privately Purchased Horse and Subscription Griffin Bye-laws.

5. I accept:-

a. Full personal responsibility for the horse for which I have applied under the terms of the Privately Purchased Horse and Subscription Griffin Bye-laws as aforesaid, and I am fully able to bear the financial commitment involved.

6. I hereby represent to and agree with the Stewards that:-

a. The statements contained in this Application are true and accurate in all respects.

b. Should it be established to the satisfaction of the Stewards of The Royal Hong Kong Jockey Club that this application has been made for and on behalf of a third party, or as a nominee or agent for an undisclosed Partnership or Syndicate or should I subsequently dispose or deal in any horse allocated to me (whether by disposal of my entire interest in the horse or a part interest in the horse) then I and any other parties involved in the foregoing will not only be subject to Bye-laws as aforesaid though we deemed to be guilty of a corrupt or fraudulent practice contrary to Rule 170 of the Rules of Racing whereby, firstly, I and such other persons as aforesaid shall be subject to such penalties as may be applicable under the Rules of Racing and, secondly, I and any other parties involved will be guilty of conduct making us liable to disciplinary proceedings pursuant to the Articles of Association of The Royal Hong Kong Jockey Club."

It is quite clear from the face of this document that should the applicant be successful in the ballot he was disclosing to the Jockey Club all the interests of any kind held by any person in the horse to be imported. There was no issue taken that only the name of Cunningham appeared upon the application form. Nor can it be doubted that the appellant had an interest in the horse nor that his was undisclosed to the Jockey Club both at the time of the application and thereafter. Notwithstanding his evidence that he had no intention to act dishonestly, on the face of the form Cunningham told a lie. The horse continued to be registered only in the name of Cunningham and the maintenance costs provided for the horse were fully paid by the appellant indicating a continuation of that lie. No disclosure was made by him or by the appellant of the circumstances of the interest of the appellant in the horse, and the lie contained in the application for an import permit was thereby maintained after the horse was imported and whilst it raced in Hong Kong under the name of Cunningham.

6. Michael Chu, an associate of the appellant informed Cunningham, that the ballot had been successful. Cunningham did nothing further.

7. In about June 1996, Cunningham met the appellant at the airport and was informed by the appellant that the appellant had purchased a horse and that it would go to the trainer, Bruce Hutchison ("Hutchision"). The sum of 25,000 Irish pounds had been paid to Hutchison for the purchase of the horse and the appellant had paid that money to him. Cunningham did not contribute to the purchase price and the appellant named the horse "Vintage".

8. Cunningham selected the colours for the jockey to wear and went to see the horse on the advice of the appellant or Michael Chu. He did not attend its first race, but was urged to attend further races by Hutchison as the Jockey Club monitors owner's attendance. Cunningham received money from the appellant to settle monthly expenses that were deducted by direct debit from his bank account and payable by him as the member registered with the club as owning a horse. From time to time those funds were late in arriving from the appellant and Cunningham had to request payment. Cunningham was not financially able to bear the upkeep and racing costs of a horse.

9. The first ground of appeal is that there was a material irregularity in that the learned magistrate failed to make any or sufficient findings (a) in respect of the essential elements of the charge; and (b) in support of his findings that items (1) to (3) of the particulars were proved.

10. The parties are in agreement as to the law relating to conspiracy to defraud and the laws as is set out in R. v. Wai Yu-tsang [1992] 1 AC 269 PC where Lord Goff said at page 275 :

"... Welham v. Director of Public Prosecutions [1961] A.C. 103. ... has however since been referred to as providing guidance in cases of conspiracy to defraud: see Reg. v. Scott [1975] A.C. 819, 838, per Viscount Dilhorne, a proposition with which their Lordships are respectfully in agreement. In Welham ... The House of Lords held that there was no warrant for confining the words 'intent to defraud' to an intent to deprive a person by deceit of an economic advantage or to inflict upon him an economic loss, and further that such an intent could exist where there was no other intention than to deceive a person responsible for a public duty into doing something, or failing to do something, which he would not have done, or failed to have done, but for the deceit...."

Page 279 :

"The question whether particular facts reveal a conspiracy to defraud depends upon what the conspirators have dishonestly agreed to do, and in particular whether they had agreed to practise a defraud on somebody. ... It is enough for example that, the conspirators have dishonestly agreed to bring about a state of affairs which they realise will or may deceive the victim into so acting, or failing to act, that he will suffer economic loss or his economic interest will be put at risk. ... Of course, if the conspirators were not acting dishonestly, there will have been no conspiracy to defraud; ..."

11. Mr Wong argues that the magistrate did not make findings in respect of the essential elements of the charge and argued the proposition that when two or more persons entered into an agreement to do an unlawful act, it must be their intention to each personally carry out that unlawful act. Upon his argument, for two persons to enter into an agreement for an unlawful act to be done, but for that act only to be done by one of the persons involved is not a conspiracy. I do not agree with this argument. The essential element of the offence is that an agreement be reached for the unlawful act to be done, and that each of the parties intended at the time that the conspiracy came into existence that the unlawful act be carried out. It is not a requirement of the offence that each of the conspirators intended personally to carry out that unlawful act.

12. Mr. Reading, for the prosecution, argues that the magistrate had well in the forefront of his mind the proposition that notwithstanding the evidence of Cunningham that he did not intend to be dishonest, he did intend that a lie be told in the application form and that that application go forward to a ballot for a licence to import a horse which was to be held in the name of Cunningham but to the benefit of the appellant. The magistrate further had in mind the element of the offence that some economic harm or potential of economic harm must come to the Jockey Club to make this a conspiracy to defraud.

13. I am satisfied that the magistrate had in mind these essential elements of the charge when he set out his findings, that items (1) to (3) of the particulars were proved but that item 4 was not proved. Those findings were made within the framework of the elements of the charge and the concessions made by the prosecution as to the definition of those particulars.

14. It is an irresistible inference that when Cunningham signed the blank form for the application for the import of a horse to be balloted, given the disclosures and undertakings required on the face of that form, and knowing that the horse was to be in truth the horse of the appellant, he must have intended to lie on the face of that form.

15. Mr Wong further argues that the magistrate erred in failing to state upon what basis and applying what particular principle that he had reached the conclusion that the appellant was the true owner of Vintage and to state what considerations he had given to the Jockey Club's Rules or Bye-laws, and/or Mr. Cheng's evidence regarding the prejudice that the Jockey Club would suffer or had suffered.

In coming to his finding that Cunningham had lied on the form, it is not, in my view, necessary for the magistrate to go further and point out precisely what bye-laws or rules had been breached by that lie. It is the clear intention of the form that the true proposed ownership of the horse to be imported be set out. Taking Cunningham's evidence in conjunction with that form, it is quite clear that he never intended to be the beneficial owner of the horse or to pay for its upkeep. In the magistrate's finding that he lied in respect of that form, it is implicit that he held that Cunningham was not to be the true owner as averred on the form and that a false undertaking was being taken to the Jockey Club. The magistrate clearly had in mind prejudice to the Jockey Club when he said in his findings at paragraph 28:

"As I said my function in this matter was to try if the Appellant committed any criminal offence. I was not interested if the Appellant was in breach of any rules of the Jockey Club. I was interested only if the Appellant practiced a fraud on the Jockey Club thereby causing prejudice to the Jockey Club."

16. Prejudice was certainly caused, as Mr Wong conceded during his argument before the learned magistrate, to other members of the Jockey Club by the fraudulent application of Cunningham and the appellant. Had the Jockey Club known that Cunningham was secretly applying for a horse on behalf of the appellant, they would not have permitted the application. That would have meant some other member would have succeeded in the ballot and not only had that member been prejudiced by the actions of the appellant and Cunningham, but also the independent nature of the balloting system was brought into potential dispute. Further prejudice is clearly caused to the Jockey Club where the true owner of a horse is not disclosed. Were a member to be able to own several horses in the same race without the knowledge of the Jockey Club or members of the public, potential exists for the running of a race not upon the merits of the horses. That is to the detriment of the Jockey Club as it is part of its function as the sole racing authority in Hong Kong to present to the gambling public races which are a true reflection of the quality of the horses participating in them. The magistrate was satisfied from the matter in which he conducted the trial and from his findings, that such prejudice existed. Grounds of appeal one to three must fail.

17. Ground four of the appeal alleged that the magistrate failed to take consideration sufficiently or at all certain elements of the prosecution case and further that during the course of the trial, the prosecution case did not emerge precisely in a manner opened by the prosecution.

18. It is not incumbent for a magistrate to deal in his reasons oral or written with each and every particular of the evidence, nor every detail argued before him. I have considered fully the arguments of counsel, and I am satisfied that the magistrate had a good and proper grasp on the facts led before him and was alive to the differences between the case as it emerged and the case as first stated by the prosecutor. Essentially, the case remained unchanged, although some particulars were not borne out by the evidence, and the magistrate found that some of the particulars of the charge were not proved. All the particulars of a charge need not be proved, however, so long as sufficient elements of the charged are proved to a degree that the magistrate is satisfied so that he is sure that the offence has been made out.

19. The magistrate has referred to the elements of the offence and has in his findings, both oral and written, set out those elements of the offence in coming to his findings. I am satisfied that he has not been in error in respect of this ground.

20. The fifth ground of appeal is that the magistrate erred in giving different reasons and findings in support of the conviction during his oral judgment at the trial, oral judgment at the review and written Statement of Findings. It is, of course, always a matter of concern if contradictory reasons are given in various rulings and reasons given at different times in the trial. I have carefully considered all of those passages referred to by Mr. Wong. The differences between the various statements are more the manner in which the magistrate expressed himself rather than of substance. He employed different language to convey his meaning at different points during the trial, but I am satisfied that in overall terms, that his assessment of the evidence, his determination of the elements to be proved in the charge and his application of the law to the facts he found to be true has not been compromised in any measure by that difference of language. This ground of appeal must also fail.

21. I further looked at all that occurred in this trial and the findings of the magistrate to see whether the conviction is unsafe and unsatisfactory and I rule that it is not. The appeal against conviction is dismissed.