HKSAR v. KWOK CHU HO AND OTHERS

HCMA1020/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

(Appellate Jurisdiction)

MAGISTRACY APPEAL NO.1020 OF 2006

(ON APPEAL FROM KTCC 194 OF 2006)

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J U D G M E N T

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1. The three appellants were convicted after trial of one charge of Attempting to Export Unmanifested Cargo, contrary to section 18(1)(b) of the Import and Export Ordinance, Cap.60 and section 159G of the Crimes Ordinance, Cap.200.  Each was sentenced to 15 months’ imprisonment.  The 2^nd and 3^rd appellants now appeal against conviction and all three appellants appeal against sentence.

The prosecution case

2. At the material time, the vessel with the three appellants on board was spotted by the marine police.  It was about 200 metres from the marine border with Mainland China when two police vessels gave chase to intercept it.  During the chase, a total of four parachute flares were fired, international signal for the vessel to stop was flashed, gas pipes were sounded.  The vessel had no sign of stopping even when the marine police vessels were close to it.  Eventually marine police officers had to board the vessel forcibly.  The 1^st appellant, Master of the vessel, was at the helm with the 2^nd and 3^rd appellants standing close by in the steering house.  The 1^st appellant was instructed to turn off the engine and the vessel eventually came to a halt several 10 metres from Chinese waters.

3. About 1,903,500 optical discs (“the discs”) were found on board the vessel without any export manifest.  The appellants claimed the discs were being transported from Chai Wan to Grass Island (Tap Mun) within Hong Kong waters.  The 2^nd and 3^rd appellants claimed they merely helped to move the discs and deal with the ropes.

Defence case

4. All the appellants elected not to give or call evidence.

Grounds of appeal

5. Grounds of appeal advanced by counsel are now regrouped and summarized as follows :

(1)     The Magistrate erred in finding that the 2^nd and 3^rd appellants were under a duty to ensure that the cargo was covered by an export manifest, and thus erred in drawing the inference to find that they knew that the cargo was unmanifested and/or that they were in a joint enterprise with the 1^st appellant.

(2)     The Magistrate erred in placing no weight on the records of interview of the 2^nd and 3^rd appellants.

Respondent’s reply

6. The respondent submitted that the present offence being one of strict liability, there was no need to proof mens rea.  There was no need for the Magistrate to draw inference that the appellants knew the cargo was unmanifested, they could avail themselves of the defence by showing they did not know that there was unmanifested cargo, or they could not with reasonable diligence have known that such was unmanifested.

7. The appellants elected not to give evidence and it is submitted that the Magistrate was entitled not to give weight to the exculpatory parts of their mixed statement.  It is further submitted that the 2^nd and 3^rd appellants failed to show that they did not know that there was unmanifested cargo, and there was ample evidence for the Magistrate to draw the inference that they were in a joint enterprise with the 1^st appellant.

My Judgment

8. Mr Khosa for the appellants submitted that only master of a vessel had a duty to ensure the goods on board were covered by a manifest, and other crew on board bore no such duty.  In his written submission, he said :

“The legislation is silent but the primary duty to ensure that goods exported on a vessel are covered by a manifest must lie with the most senior person of the vessel i/e/ the Master.  He is the person who is responsible for all aspects of the vessel.  This is also why when officers board any vessel for inspection, they always identify who the Master is.  The other crew on the vessel, especially those who are mere labourers or unqualified staff, should not bear this responsibility nor do they have to concern themselves with it.  It would be quite absurd to hold that every member of a vessel should bear this responsibility.”

9. Apart from such a bare and bold submission, Mr Khosa could not provide the court with any basis or authorities to support his submission.

10. Ground 1 of the appeal begs the question of whether the offence of attempting to export unmanifested cargo is one of strict liability.  The authorities have been nicely set out in HKSAR v. Kan Chung Hung, HCMA794/2001 :

“13.       In Lau Sai Wai [R. v. Lau Sai Wai [1985] HKLR 423] Barker JA said:

‘In our view, attempt to commit a statutory offence of strict liability does not require mens rea…All that the prosecution had to prove was that the respondent attempted to export the goods without a licence.  It was not incumbent on the prosecution to prove that the respondent knew that a licence was required or that one had not been obtained.’

…

15．       In C heng Kai[R.. v. Cheng Kai & another [1996] 2 HKCLR 91] Patrick Chan J (as he then was) said:

‘It is clear that the offence created by s. 18 of the Import and Export Ordinance, that is, exporting unmanifested cargo is an offence of strict liability.… As such it is not necessary to show that the defendant of this offence had intended that the cargo exported by him was to be unmanifested.  Apart from showing that the cargo was not declared or properly declared on the manifest, the prosecution is only required to prove that he intended to and did export the cargo, that is to say, proof the actus reus that he had exported the cargo.  I think it is of vital importance to distinguish between an intention to export (which is part of the actus reus of export) on the one hand and the knowledge or intention that the cargo exported is unmanifested or falsely described in the manifest (which is mens rea which is not required for a strict liability) on the other.  With regard to an attempt to commit a s. 18 offence, it is necessary for the prosecution to show that a defendant had done acts which are not only preparatory but also immediately connected with the act of exporting the cargo and were intended and did constitute part of the act to export…Since it is not disputed that the manifest in respect of the cargo in the present case was indeed wrong the issue to be dealt with is whether the appellant had done acts which amounted to an attempt to export cargo in question, that includes the intention to carry out those acts.  This is not the same as the intention to export unmanifested cargo.’”

11. Therefore, the short answer to Ground 1 is simply that the offence in the present case, being a strict liability one, the prosecution does not have to prove that the 2^nd and 3^rd appellants knew or intended that the cargo so exported was unmanifested.  The prosecution only needs to prove that the appellants had done the acts immediately connected with the act of exporting and intended to so export the cargo.  It would then be for the appellants to make out the statutory defence on the balance of probability.

12. The offence, being a strict liability one, means that legislature takes a serious view of this sort of offences involving the ‘smuggling of goods across the border to the Mainland is a scourge which needs harsh legislation’ (per Stock J, R. v. Chan Kim Fai, HCMA982/1993).

13. The submission that the Magistrate erred in finding that the 2^nd and 3^rd appellants were under a duty to ensure that the cargo was covered by an export manifest, and drawing the inference that they knew that the cargo was unmanifested is totally misconceived.  There was indeed no need for the Magistrate to draw that inference, given the context of the statutory framework. 

14. The next question then is : Did the appellants make out the statutory defence and whether the Magistrate was entitled to find that they were in a joint enterprise with the 1^st appellant? 

15. It was the submission of Mr Khosa that the Magistrate erred in placing no weight on the contents of the statement of the 2^nd and 3^rd appellants.  Had those been relied on, it was submitted, the two appellants would have availed themselves of the statutory defence of lack of knowledge.  Mr Khosa said this in his written submission :

“The learned Magistrate said he was not willing to give weight to those statements without their being tested by cross-examination in Court. I respectfully submit that the learned Magistrate was not entitled to do this.  The interviews were evidence.  They were more than mere utterances made under caution.  They were in the form of questions and answers which are similar to cross-examination. Both Appellants co-operated with the police officers until they had no more questions.  The learned Magistrate had a duty to evaluate such evidence by testing it against the other evidence of the case.  Only after proper consideration and evaluation could the learned Magistrate decide how much weight to give them.  What the learned Magistrate had done here was to simply ignore this evidence because it was not tested by cross-examination.  This approach is incorrect and is a material irregularity.”

16. The statements made by the 2^nd and 3^rd appellants were mixed statements.  The Magistrate said this :

“…. I was not willing to give weight to those statements without their being tested by cross-examination in Court. .…”

17. At paragraph 22 of the Statement of Findings, the Magistrate felt that the contents of the records of interview of the 2^nd and 3^rd appellants left a lot of questions unanswered.

18. Mr Khosa submitted that the answers given in the 2^nd and 3^rd appellants’ statement, being in the form of questions and answers similar to cross-examination, had to be given same weight as if the answers were given in court under oath under cross-examination.  There is no authority in support of such.

19. Counsel for the respondent referred me to the case of HKSAR v. Poon Hoi Wing & Anor [2001] 1 HKC 363.  The Court of Appeal, in applying R. v. Sharp [1988] 1 WLR 7, said :

“It is asserted, correctly, that as a matter of law both the inculpatory and exculpatory parts of a mixed statement are admissible as evidence of their truth…

That does not, however, mean that the two parts must carry the same weight.  On the contrary, a tribunal may well take the view that the inculpatory part is more likely to be true and therefore give it great weight, and the exculpatory part, being self-serving, worthy of less or even no weight…”

20. In the case of HKSAR v. Chan Hung Kwan, HCMA667/2006, a shoplifting case where the appellant had taken counsel’s advice not to give evidence, I had this to say in my judgment :

“…. Despite the fact that counsel had taken nearly every point, he did not do the most sensible thing our adversarial system calls for: to call his client into the witness box to rebut the prima facie case which undoubtedly existed. Of course in some cases, the Prosecution case alone may contain the seeds of their own destruction.  But common sense and experience tells one that those are extremely rare and the present case is certainly not one of those.

The evidence in this case is overwhelming. ....

.… What was said under caution was plainly a mixed statement and with the appellant electing not to give evidence, the Magistrate, in considering the whole of that statement in deciding where the truth lies, was perfectly entitled to place minimum weight on the exculpatory parts alleging either a mistake or forgetfulness whilst attaching full weight on the incriminating parts.”

21. The Magistrate was entitled to take the approach as he did.  Counsel’s complaint of that approach being incorrect and a material irregularity was built on an entirely erroneous understanding of the law. 

Given the state of the evidence as it stood, the 2^nd and 3^rd appellants did not make out the statutory defence.

22. I now turn to the issue as to whether the Magistrate was entitled to find that the 2^nd and 3^rd appellants were in a joint enterprise with the 1^st appellant.  The Magistrate set out in paragraphs 22 to 24 of the Statement of Findings his consideration.

23. I also refer to the Chinese judgment of香港特別行政區訴蔡穗玲，HCMA614/2006.  In that judgment Nguyen J quoted the following extracts and cases :

(1)     Bruce and McCoy on Criminal Evidence in Hong Kong ：

“There are circumstances in which a court may more readily draw an inference adverse to the accused from evidence in the absence of testimony from the accused.”

(2)     According to R. v. Lo Sui Wing & Another, CACC509/1989，Macdougall JA said :

“Where an inference of guilt may properly be drawn from a set of facts, a jury or a judge sitting without a jury, is entitled in the absence of a credible explanation leading to a different conclusion, to convict the accused on the basis of that inference.”

(3)     Fuad VP in R. v. Cunningham, HCMA941/1992, remarked that an accused person should not be surprised if an inference which can legitimately be drawn is more readily drawn when the accused elects not to give evidence.

(4)     The Court of appeal, in R. v. Chong Kin Cheong, CACC196/1995, said :

“A judge or jury faced with evidence from the prosecution which is unanswered by testimony from the accused is not required to imagine possible defences of which there is no evidence, but, rather, is required to act upon the evidence available.”

(5)     In R. v. Tan Siew Gim [1995] 1 HKLR 299, it was held that :

“Where the inference of guilt is available to the tribunal of facts and no explanation is given, it is not open to complain on appeal that another inference was available to be drawn, particularly when the facts cry out for an explanation.”

24. The Magistrate was entitled to draw the inference as he did.  This appeal, by the 2^nd and 3^rd appellants against conviction, has no merits.  Appeal against conviction by the 2^nd and 3^rd appellant is dismissed.  I affirm the conviction.

Appeal against sentence

25. It was submitted on behalf of the three appellants that the starting point of 15 months’ imprisonment was both manifestly excessive and wrong in principle on the following grounds :

(1)     The goods in question were not high value goods.  Smuggling of these goods was not prevalent and the Magistrate erred in imposing deterrent sentences.

(2)     The Magistrate failed to distinguish the role played by the three appellants which should be reflected in a difference in sentences.

26. Counsel for the respondent, however, submitted that taking into consideration the nature of the goods as well as its value, the starting point of 15 months’ imprisonment could not be said to be manifestly excessive.  It was further submitted that there should not be any apportionment of blame amongst defendants acting in a joint enterprise.

27. The Magistrate said this in his Reasons for Sentence :

“          Offences of importing or exporting unmanifested cargo (colloquially described as smuggling) are still quite prevalent. This case involved just over 1.9 million optical discs.  Even ascribing a nominal value of only $1 to each disc, the value came to be some $1.9 million.

28.      I referred to the case of HKSAR v YIP Shuk Tat CACC 496/2000 and the cases mentioned therein.  The appeal against sentence in that case concerned that imposed for the 2^nd Charge of conspiracy to import unmanifested cargo viz. motor vehicles ‘obviously of a value of about $2,000,000.’  The Court of Appeal said that ‘bearing in mind that the Appellant committed the offence out of stupidity, ignorance and blindness to the obvious caused by greed rather than deliberate contravention of the law… the proper sentence should have been 2 years’ imprisonment after trial.’ (see paragraph 24 of the judgment).

29.      The Court of Appeal felt ‘the fact that smuggling of motor vehicles was involved’ made that case serious.  The present case was of course not concerned with motor vehicles. However, the value involved was comparable to that in YIP Shuk Tat (ibid.).  Unlike the Appellant there, I found that the Defendants before me knew full well that they were exporting the discs to the Mainland without the required manifest.  They were of course doing this for reward.  Giving allowance for the fact that the present case was not concerned with motor vehicles, I decided that a sentence of 15 months imprisonment after trial appropriate.”

28. The maximum sentence of the present offence, on summary conviction, is a fine of $50,000 and two years’ imprisonment.

29. R. v. Ng Choi Yau, HCMA262/1992 laid down tariff sentence of 12 to 15 months’ imprisonment, on a plea, for offences of this type.  That case involved used motor cycles.

30. In R. v. Ng Wai Hong, HCMA797/1992, that case involved large quantity of electronic parts, namely, 40 video cassette recorders and 130 laser disc players together with other items.  Litton JA said that no distinction should be made between the smuggling of motor-cycles and of electronic equipment for purposes of sentencing, as these were all high value products.  He said, however, that magistrates could draw a distinction between various types of products in imposing sentences for smuggling offence :

“Obviously, in low value products, where the gain from smuggling would be low, and the incidence is rare, the magistrate can afford to take a more relaxed view.”

31. He considered a sentence of 12 months after plea was at the upper-most end of sentences for this type of smuggling. 

32. Such sentencing principle was echoed by Leong J, as he then was, in R. v. Lam Ting, HCMA11/1997.

33. Counsel for the appellants have referred me to the case of HKSAR v. Wong Ah Cheung & Anor, HCMA1175/1998 which involved the export of 140,000 video compact discs worth $4.2 million.  The 1^st appellant there was the master of the ship, both appellants pleaded guilty.  On appeal, Deputy Judge Jackson, as he then was, reduced the sentences of the two appellants to six months and four months respectively in the light of mitigating factors.  He said :

“…. The starting point in sentence adopted of 18 months imprisonment was a high one given the maximum sentence of 2 years.  Neither appellant has previously served a prison sentence; indeed the 2^nd appellant has not previously offended.  The background reports before the learned Magistrate were positive and stressed the hardship that would inevitably be suffered by the families of the appellants in the event that they should be sent to prison.  The rewards to be given to the appellants for this illegal enterprise were exceedingly modest and both appellants were full of remorse.  Finally the vessel in which the offence was committed was confiscated…”

34. It is worth noting that Jackson J, in one of his later cases of HKSAR v. Chan Pui Sum, HCMA1081/2000 which involved smuggling 285 packages of vehicle parts with an estimated value of $500,000which is much lower than the value of the goods in the case ofWong Ah Cheung, reiterated the 12 to 15 months’ tariff laid down in Ng Choi Yam, and did not disturb the sentence of nine months imprisonment after trial.

35. These cases, and in fact the other cases relied on by counsel for the appellants, are not tariff or guideline cases and each turns on facts of its own.  The Court of appeal, in HKSAR v. Yip Chuk Tat, CACC496/2000 observed that :

“      Reviewing the authorities cited above, it appears that the Court of First Instance, on appeal from magistrates, have all along adopted no higher than a starting point of 12 months for the same or similar offence after plea…In Wong Kwong-hei and Choi Gin-ngon, both of which related to motor vehicles, the sentences after trial, as approved by this Court, were respectively 18 and 20 months.”  (my emphasis)

36. The 15 months’ imprisonment imposed by the Magistrate after trial is well within the tariff laid down in the authorities and could not be said to be manifestly excessive.

37. Whilst there was a difference in sentence between the two appellants who assumed different roles in Wong Ah Cheung, the two appellants pleaded guilty and according to the set of facts admitted for the purpose of sentencing, the roles of the two appellants were clearly distinguished : that D1 there was the master of the vessel who employed D2 to engage in this illegal delivery of the goods.  However, in the present case, as no weight was attached to the exculpatory parts of the statements of the appellants, the Magistrate was left with no evidence as to who amongst the three was the mastermind.  The Magistrate was correct in making no distinction between the roles of the appellants.

38. The appeal against sentences by the three appellants is dismissed and I affirm the sentences.