ATTORNEY GENERAL v. BOW KI LUN and Another

IN THE COURT OF APPEAL

Application for Review
1995, No.4

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H E A D N O T E

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Application for Review - appropriateness of sentences for soliciting an advantage and accepting an advantage - Failure to appreciate gravity of offences - desirability of indicating a starting point when assessing sentence - cautioned statements from which offender resiles can be given no weight in mitigation - sentences increased.

IN THE COURT OF APPEAL

Application for Review
1995,No.4

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J U D G M E N T

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Power, Ag. C.J. (giving the judgment of the Court):

1. This is an application by the Attorney General for review of sentences imposed on BOW Ki-lun, the 1st respondent, and LEUNG Chun-shu, the 2nd respondent. They were convicted after trial in the District Court before Deputy Judge Candy. The 1st respondent was convicted of one charge of soliciting an advantage and of 17 charges of accepting an advantage. The 2nd respondent was convicted of 16 charges of offering an advantage and of one of false accounting. The 1st respondent was sentenced to 12 months on each charge to be served concurrently and the 2nd respondent was sentenced to six months on each charge also to be served concurrently. The Attorney General asks this court to review those sentences on the ground that they were wrong in principle and manifestly inadequate.

2. The facts are simply stated. In April 1990 the 1st respondent became the Fire Protection Manager of the China Light & Power Company ("China Light"). The 2nd respondent was the principal shareholder of the OSH Corporation Limited ("OSH")which supplied and installed fire protection equipment. In August 1990, the 1st respondent recommended OSH as a tenderer to carry out the coating of cables with fire retardant materials for China Light. In September 1990 OSH tendered and was awarded a contract for such work to run from December 1990 to September 1992. This work in the outcome was worth about $11m.

3. In January 1992 OSH was taken over by an American company the Viking Corporation and at that time the 2nd respondent became a director of the Hong Kong arm of the Viking Corporation ("Viking") together with two Americans, a Mr. Frantzen and a Mr. Groos.

4. The 1st respondent admitted under caution that he had solicited 5% of the value of the contracts awarded by China Light to OSH./Viking for the supply and installation of fire protection equipment and for assisting and advising OSH/Viking to secure contracts. He admitted that he had received $500,000 and $600,000 in cash at various times from the 2nd respondent. The first payment was in February 1991 and the last in October 1993.

5. The 2nd respondent admitted that he had paid amounts and that they had been in cash and that they were for ensuring that work went to OSH/Viking.

6. The 2nd respondent, in order to conceal the corrupt payments, created a number of false invoices which give rise to the charge of false accounting.

7. Although both respondents made lengthy exculpatory statements under caution when being investigated, both at trial pleaded not guilty, contested the issue of guilt and challenged the admissibility of their statements.

8. Mr. Zervos, who appears for the Crown today, urges firstly that the trial judge failed properly to weigh the gravity of the offences. The real thrust of the Attorney General's application lies in this ground. It is submitted that the trial judge, however comprehensively he may have apprehended the facts and however carefully he may have weighed them, in the outcome failed to give due weight to their gravity.

9. It was next urged that the trial judge failed to take into account that they were multiple offences. The Attorney General is not on such strong ground in this submission. Although there were seventeen accepting offences they arose out of one solicitation and the payments were made as a result of that solicitation. While it is true that those offences cannot be regarded as one offence we are satisfied that, when sentencing, the judge could properly look at them globally, bearing in mind that they were inter-connected throughout. This is not so as regards the charge of the false accounting faced by the 2nd respondent as it was clearly a separate offence and, in our view, merited a consecutive sentence.

10. The third submission of the Attorney General is that the trial judge fell into error when assessing sentence because he failed to fix the starting point and then to give credit for mitigating circumstances. While there may be cases where the trial judge is not called upon to fix his starting point, in our view it is most desirable, in the great run of cases, that this be done. It allows the judge to focus upon the point from which deductions for the mitigating circumstances can be made and, should there be an appeal, it allows the appellate court immediately to comprehend the judge's approach to sentencing.

11. It is suggested next by the Attorney General that the judge gave too much weight to personal factors. There were strong personal factors but we are unable to say how much weight the judge gave to them as he did not indicate his starting point. Suffice to say that we appreciate the merit of these factors and will, in the outcome, take them into account.

12. It is also submitted, and the Crown is on strong ground here, that the judge placed a quite unwarranted emphasis on co-operation. This co-operation, which consisted in the giving of cautioned statements, should have been given no weight in mitigation once the respondents pleaded not guilty and resiled from the admissions which they had made therein. By so doing they forfeited any mitigating entitlement which they might otherwise have had.

13. It was finally submitted that the judge had wrongly treated the 2nd respondent more leniently than he did the 1st respondent. We do not accept that the judge was wrong in so doing. We are satisfied that the 2nd respondent was less culpable than the 1st respondent and that he was entitled to more lenient treatment.

14. Mr. Macrae, who appears for the 1st respondent, submits that the reasoning of the trial judge was, except for his reference to co-operation to which I have already referred, not open to criticism. He urges that this court should be slow to interfere with the sentence of a judge who, having correctly appreciated the facts and having carefully weighed them, then makes a deliberate decision to impose a lenient sentence. Her refers us to The Attorney General v. Hector Joseph Carlyle (1976) HKLR 60. I need read only from the headnote thereof which states:

"The court would be slow to interfere with the inadequacy of a sentence and would do so only when a sentence of the lower court was very clearly wrong having regard not only to the whole of the circumstances of the offence but also to those of the offender."

Having no doubt as to the correctness of that statement it is for us to determine whether the sentencing judge was "clearly wrong".

15. Mr. Macrae points outs that it must be borne in mind that the 1st respondent has lost his good name, his right to participate in a Provident Fund and has been ordered to forfeit the sum of $558,000. Mr. Macrae concedes that the sentence was a lenient one, but argues that there were very powerful mitigating circumstances which warranted that leniency.

16. Mr. Sakhrani, who appears for the 2nd respondent, asks that a careful evaluation of his culpability be made. He submits that when the facts are examined it will be seen that what was done was not a payment to obtain the original contract but was a payment to ensure that, the contract having been awarded, the work would continue without any "rocking of the boat". He lays great stress upon the fact that it was not a payment for specific benefits. He took us to the statement of the 2nd respondent in an endeavour to establish that this was so. Mr. Zervos on the other hand reminds us that OSH/Viking was doing continuing work for China Light and was doing it sequentially and that additional payments were coming due which had from time to time to be approved. He points out further that it is clear from the findings of the judge that the 1st respondent was providing technical information throughout to the 2nd respondent.

17. It is the suggestion of Mr. Sakhrani that there was no personal greed or personal benefit on the part of the 2nd respondent but again, Mr. Zervos points out, the 2nd respondent was a shareholder in OSH/Viking and to that extent did stand to gain.

18. That the 2nd respondent and his associates felt, if they so felt, that in the business climate of Hong Kong they had no choice but to pay the 1st respondent's demands would be a sad commentary upon the business morality of this territory.

19. It is the duty of this court to make it plain to the business community that when situations such as this arise there is only one course open to the person to whom the offer is made - report the matter to the authorities.

20. There can be no gainsaying that these were serious offences committed over a substantial period of time. More than half a million dollars was involved. Offences of this kind strike at the heart of business probity.

21. We are satisfied that a proper starting point for the 1st respondent would have been four years. We are satisfied that as proper starting point for the 2nd respondent upon the charges of offering an advantage would have been 2½ years and a proper starting point on the false accounting charge would have been six months.

22. We give full weight to the favourable view which the trial judge clearly and properly formed of the mitigating circumstances and giving full weight to those circumstances we are satisfied that the starting point of four years for the 1st respondent should be reduced to one of three years. For the 2nd respondent the starting point of 2½ years should be reduced to one of 20 months and the starting point of six months should be reduced to one of four months. These sentences, however, must be made consecutive which gives a total of 24 months for the 2nd respondent.

23. In being more generous in the reductions given to the 2nd respondent, we bear in mind his very strong personal mitigating circumstances and the indication in The Attorney General v. Wong Kwok-wai (1991) 2 HKLR 384 as to the propriety of a discount when an offender is close to the end of his sentence.

24. The Attorney General's application succeeds and the sentences will be varied accordingly.