HKSAR v. CHAN WAI MAN

CACC 177/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 177 OF 2001

(ON APPEAL FROM DCCC 775 OF 2000)

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J U D G M E N T

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Hon Yeung JA (giving judgment of the Court):

1. The appellant, Chan Wai-man was convicted after trial on 2 charges of forgery and one charge of obtaining pecuniary advantage by deception by HH Judge Poon in the District Court. He was sentenced to 3 years' imprisonment for each of the 3 charges to run concurrently.

2. Initially the appellant seek leave to appeal against both conviction and sentence. He abandoned his application relating to conviction before Mayo VP on 27 December 2001. He was however granted leave to appeal against the sentence.

3. The facts of the case can be summarized briefly as follows:

At all material time, the appellant was working as a car dealer in Tin Hau Temple Road. He came to know the victim, a Mr. Kwan who owned a Mercedes Benz. In October 1996, Mr. Kwan entrusted the appellant with the registration documents of his vehicle so that the appellant could renew its vehicle license. Mr. Kwan also signed some documents issued by the Transport Department.

4. The appellant did not return the registration documents to Mr. Kwan and instead used them to obtain a loan of $640,000 from Citicorp in September 1997. In so doing, the appellant forged a trade-in agreement and a notice of transfer of ownership of a vehicle. The trade-in document and the notice of transfer formed the subject matters of the 2 charges of forgery and the obtaining pecuniary advantage charge related to the $640,000.

5. When his dishonesty was exposed in mid-1998, the appellant agreed to redeem the registration documents and issued a cheque for $130,000 to Mr. Kwan for such purpose. However the cheque was dishonoured upon presentation for payment. Subsequently, the appellant gave a cashier order for $30,000 to Mr. Kwan's solicitors as partial restitution. He had also paid interest to Citicorp of $32,500.

6. The appellant was 41 years' old at the time of the offence and is married with two children from a previous marriage. He has a clear record. It appeared that the appellant was driven to act as he did because of financial crisis. His is an adjudicated bankrupt and Citicorp had foreclosed his home.

7. The judge pointed out this was a clear case of breach of trust. Although Mr. Kwan did not suffer any financial loss as he had subsequently repossessed his car, he was however deprived of its use and had lost the opportunity to sell it.

8. We are told to day that there is still an on-going dispute between Citicorp and Mr. Kwan over the vehicle in question.

9. The judge adopted a starting point of 3 years' imprisonment for each of the charges and gave no discount. She however ordered the sentence to run concurrently.

10. Mr. Grounds on behalf of the appellant argues that he should be given credit for his clear record and the partial restitution. Mr. Grounds emphasizes that as a result of the foreclosure of the appellant's home, there was a surplus and $250,000 was used to partially set off the debt in respect of the vehicle in question.

11. The undisputed fresh evidence shows that the appellant had obtained loans amounting to $2,528,000 from Citicorp with 5 vehicles including the one belonging to Mr. Kwan. The loans remained at over $2.3 million.

12. After the foreclosure of the appellant's home, there was a surplus of about $1.08 million. Citicorp used such surplus to offset the loans of $2.3 million. Citicorp notionally applied $250,000 to the loan relating to Mr. Kwan's vehicle. In fact, the appellant still owes Citicorp about $1.3 million.

13. The $250,000 in our view could not be considered as restitution as such. It was not a voluntary repayment by the appellant to discharge the sum defrauded or any part thereof. Citicorp was simply exercising its contractual right to use the surplus to set off part of the loans. $250,000 was just a notional figure and there is still an outstanding debt of $1.3 million. We fail to see how the decision of Citicorp in the circumstance can have any bearing on the sentence of the appellant.

14. The appellant suggested that it would have been better for him "to insist the sale proceeds from the said flat were first used to discharge the loan in respect of EY 113 (Mr. Kwan's vehicle)." Whether the appellant could so insist is speculative, we are however, not persuaded that this is as important as Mr. Grounds seeks to argue in view of the remaining debt of $1.3 million. In our view, the figure of $250,000 as notional partial repayment of the debt arising out of Mr. Kwan's car is not a significant mitigating factor.

15. Mr. Grounds refers to the cases of Barrick (1985) 81 Cr. App. R. 78, Clark [1998] 2 Cr. App. R. 137, Wong Kay Din (unreported) App. for Rev. No. 7 of 1998, Wat Wai Leung (unreported) Cr. App. No. 276 of 2000 and Lee Kun Wai & Chan Siu Ming App. for Rev. No. 6 of 1992.

16. These cases are of course well known to this court.

17. Sentence depends on the facts of each case and the amount involved is just one of the relevant factors. But applying the factors referred to by Lord Lane in Barrick (supra), we are persuaded that the present case is not a very bad case of the type.

18. While it was a clear case of breach of trust, there was no other serious aggravating factor. Only Citicorp suffered any financial loss and the inconvenience to Mr. Kwan was not significant in the light of the background of the case. It was a one-off deception.

19. The sentence of 3 years' imprisonment as conceded by Ms. Chan for the prosecution is a stern sentence and the appellant received no discount.

20. Clear record is normally not a mitigation factor in cases of this nature as the authorities suggest and the way the appellant defended the charges clearly demonstrate total lack of remorse.

21. We are persuaded, however that the starting point is excessive and 2 years and 6 months is more appropriate. We would further reduce it by 2 months for the restitution of $30,000 and the reduction of the total debt owed to Citicorp by reason of the foreclosure of the appellant's home.

22. We are of the view that justice will be served by imposing a total sentence of 2 years and 4 months imprisonment.

23. The appeal is allowed. The sentence on each of the three charges is 2 years and 4 months' imprisonment to run concurrently. The total sentence is reduced accordingly and the appeal is allowed to the extent indicated.