HKSAR v. LAU HON SING

HCMA 527/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO. 527 OF 2001

(ON APPEAL FROM ESCC 2734/2000)

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J U D G M E N T

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1. The appellant was convicted after trial of 8 charges. They were 4 charges of Using a false instrument, contrary to section 73 of the Crimes Ordinance, Cap. 200. These offences occurred between 30 November 1995 and 13 August 1997. He was also convicted of 3 charges of False accounting, contrary to section 19(1)(a) of the Theft Ordinance, Cap. 210, and these offences occurred between 8 August 1996 and 13 August 1997.

2. The appellant was sentenced to 9 months' imprisonment on each charge, to be served concurrently. The appellant had originally lodged appeals against both conviction and sentence but at the hearing of the appeal, the appellant abandoned his appeal against sentence.

Facts

3. It is not disputed that the appellant was, at all material times, an insurance agent employed by Manulife (International)Limited ("Manulife"), which is an insurance company. The prosecution called a total of 7 witnesses. The first three prosecution witnesses were employees of Manulife who gave evidence about the system of work in Manulife, particularly with regard to the restrictions on new insurance policy, the accounting system and they had also produced various documents. These witnesses also described the types of life insurance. Basically, there were two types of life insurance which were relevant to this case, one was called the estate protective policy which pay dividends but which were fairly conservative in nature and the flexible investment protective life insurance which was more risky but which ultimately may carry greater benefits. The learned Magistrate referred to them as EP and FIP respectively.

4. The unchallenged evidence is that the defendant was paid by commission and his commission would be greater for FIP agreements which ranged from 50% of the premium for the first year down through 15% for the second to 2% thereafter. The commission would only be paid on the increased premium value if the existing policies were replaced by new ones. If an existing policy was terminated within 6 months of a new policy, it was deemed to be a replacement and the commission due to the agent would be restricted. It is also the evidence that the signing of any blank forms would never be sanctioned by Manulife.

5. PW4, Miss Lau Siu Cho, was the holder of a number of policies from Manulife including one from 1987 and another from 1990. She gave evidence that the appellant approached her in 1996 and told her that she could combine all her policies which she wanted to do in any event in order to reduce the multiplicity of payments from her account. According to her evidence, she said that the appellant asked her to sign two blank application forms and he had told her that they were in duplicate. One of those two forms was produced as Exh. 9, which was dated the 11th of August 1996. The second of the two application forms became part of another policy which was produced as Exh. 13. The learned Magistrate accepted PW4's evidence that she did not sign a policy loan agreement which is exhibited as Exh. 6 and rejected the evidence of the handwriting experts called by the defence. The learned Magistrate also accepted PW4's evidence that by 1996 her signature had changed from the one she originally signed in 1987 as shown in the policy application Exh. 5. On the strength of her evidence, the learned Magistrate convicted the appellant of charges 1 to 3.

6. PW5 Mr Lau Siu Keung had life insurance policy with Manulife since 1989. He said that in November 1996, the defendant, who was his agent at the time persuaded him that his existing policy was too conservative and that for minimum additional premium, investment features could be added to those policies. PW5 thus signed various forms but had not appreciated the fact that a new policy was being created as opposed to an amendment to his existing policy. PW5 said his signature had changed since 1990 and he never went back to using his old signature. PW5 said that the signatures on Exh. 18, 19 and 23 were not his. The learned Magistrate after considering the evidence of both handwriting experts for the prosecution and the defence, ultimately believed the evidence of PW5 as to the signatures. Similarly, as in the case of PW4, the learned Magistrate, after having considered the handwriting experts' evidence, ultimately relied on the evidence of PW5 to convict the appellant of charges 5, 6 and 7.

7. PW6, Miss Lau Siu Yin gave evidence that she had various policies with Manulife. In 1995, the defendant approached her and told her that she could combine her first two policies and that means that she had to surrender the first two policies. She did so and entered into the fourth policy on the understanding that it was such a combination. The application is produced as Exh. 35 and dated the 30 November 1995. PW6 said that when she signed Exh. 35, it was a blank form. The new policy was not an estate protector but was an FIP policy. The learned Magistrate accepted PW6's evidence that she did not want to change the nature of her policy and would not have entered an investment plan with Manulife. The learned Magistrate after considering the evidence of the handwriting experts, came to the conclusion that he found PW6's evidence to be credible and reliable, but as he cannot be sure that the signatures on the relevant documents were in fact forgery, he found that charges 9 and 10 had not been proved and he acquitted the appellant of those charges. However, he convicted the appellant of charge 8.

Grounds of appeal

8. The appellant in his grounds of appeal has made the following criticisms:

(a) That the learned Magistrate had failed to properly or sufficiently consider the discrepancies in the evidence of the various prosecution witnesses i.e. PW4, 5 and 6.

(b) That the learned Magistrate had failed to properly consider the evidence of the handwriting experts, particularly the defence handwriting experts as to the various documents.

(c) That the learned Magistrate had failed to give sufficient consideration to the policy confirmation receipt documents and the "welcome letters ", which, according to the evidence of the witnesses from Manulife, were sent to the policy holders. The appellant's point being that these documents contained the policy numbers of the various new policies that were in issue in this case and, therefore, they would cast doubt on PW4 to PW6's evidence that they did not realise that they had bought into these various new policies.

(d) That the learned Magistrate had failed to consider that these complaints were the only complaints against the appellant, in his many years as an insurance agent and therefore it is unlikely or more improbable that he would have committed these offences.

(e) That the learned Magistrate had made improper comments throughout his statement of findings, for example, by saying how the witnesses had no intention to kill themselves in relation to the "suicide clause" and also the comment about how a greater proportion in commission would be due to an agent, should the client change to an FIP policy.

The Magistrate's findings

9. The learned Magistrate, both in his oral reasons for verdict and in his Statement of Findings, meticulously went through all the evidence that was before him, reminding himself very properly, first, of the burden in standard of proof, of the fact that no adverse inference should be drawn against the appellant for not testifying, of the appellant's clear record which is relevant to propensity. He also very properly found it inappropriate to approach the evidence in this case on the basis of similar fact evidence, he was correct to treat each group of charges separately and most significantly the learned Magistrate reminded himself that it was important to distinguish between "commercial inaptitude or misunderstanding and the dishonest behaviour which is alleged in these charges". He also cautioned himself about giving undue weight to the demeanour of a particular witness which is apt to be misleading.

10. The learned Magistrate in going through the evidence of PW4, not only considered her evidence in light of the handwriting experts' evidence, but also did not overlook the fact that PW4 did withdraw or change her position with regard to some signatures which she had originally alleged as false. However, he felt that these discrepancies did not affect or undermine PW4's evidence. He, also, at page 456 of the Bundle, referred to the evidence of the policy confirmation documents and the allegation by the defence that PW4 and the other two witnesses PW5 and 6 would have been able to cross check the new policy numbers from these documents. The learned Magistrate found that PW4, 5 and 6 were busy people and that they had fully trusted the appellant and, therefore, did not feel the need to cross check policy numbers or bank statements. As for the "welcome letters" he drew attention to the fact that PW4 and the other witnesses have no recollection of receiving these letters and that even if they did receive them, these are the sort of routine correspondence which he felt could be easily overlooked and unlikely to be examined in detail. He also rejected the defence's suggestion that these 3 witnesses had got together to frame a case, falsely, against the appellant.

11. The learned Magistrate, when dealing with the evidence of PW5, similarly looked at the evidence of PW5 in great detail, he drew his attention to the fact that PW5's evidence was not entirely consistent on the question whether the various forms he had signed were blank or not. He was, however, sure of the fact that PW5 had by the year 1997 altered his signature radically from that which he had used back in 1989, and came to the conclusion, based mainly on the evidence of PW5, that the relevant signatures were forged. Again in coming to this conclusion, he had also meticulously referred to the handwriting experts' opinion on these various signatures.

12. The learned Magistrate after considering the evidence of PW6 in some detail, said he believed that she would not have entered an investment plan with Manulife. Again, after very carefully assessing the evidence of PW7 and DW1, the two handwriting experts that had been called, he concluded that PW6 had been an honest and credible witness. However, based on all the evidence before him, he could not be sure that the appellant had committed the offences in charges 9 and 10 and he therefore acquitted the appellant of those charges and only convicted the appellant on charge 8.

13. The learned Magistrate in his Statement of Findings referred in great detail to the evidence given by PW7 Dr Daniel Wong and DW1 Mr John McLean, who were the two handwriting experts called. In his analysis of their evidence which took up 9 paragraphs of his Statement of Findings, the learned Magistrate concluded that the handwriting evidence was neutral and that at the end of the day, considering the handwriting evidence together with the evidence of the various witnesses, he came to the conclusion that the witnesses, PW4, 5 and 6 were honest and reliable witnesses.

Conclusion

14. An appeal is not a re-trial. It is rare for an appellate court to upset a magistrate's findings on the facts unless those findings were unsupported by the evidence or the learned magistrate had misapplied the law in coming to his conclusion or he had erred procedurally. This is so because the learned Magistrate had the chance of observing the witnesses first hand when they were giving evidence in the witness box.

15. The appellant complained that the learned Magistrate had made a lot of personal comments on the evidence using "unfair wordings". A magistrate in assessing the evidence before him not only has to assess the evidence in light of the law and the proper procedure but he has also to use his common sense and his knowledge and experience of the world. He is therefore entitled to comment on the evidence before him and to accept or reject the evidence of any particular witness. In this case after a careful examination of the evidence of the handwriting experts, he was not inclined to accept their evidence fully. He was only prepared to consider their evidence as neutral. Again, this, he was entitled to do.

16. After considering the appellant's grounds of appeal and reading the learned Magistrate's oral reasons for verdict and his Statement of Findings, I do not find that the learned Magistrate had committed any error in law or procedurally. There was ample evidence for him to come to the conclusion that he did. The appellant has raised in his appeal, this morning, his personal background. Whilst I have the greatest sympathy with the fact that he would be losing a career that he has built up over 10 years, nevertheless, I have to look only at the merits of the appeal. I can find no merit in this appeal and I therefore dismiss the appeal.