HKSAR v. SHAM KWOK KEE

CACC 142/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL NO. 142 OF 2013

(ON APPEAL FROM DCCC NO. 762 OF 2012)

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Hon Yeung VP (giving the Reasons for Judgment of the Court):

The Facts

1. On 20 November 2004, police officers executed a gambling authorisation against a public housing unit at Room 3118 in Sui Lok House, Siu Sai Wan Estate, Chai Wan (the premises) where the applicant (Sham Kwok-kee) resided with his wife and daughter.

2. Under caution, the applicant said he had received bets on soccer matches for fun from PLB drivers.  The applicant further claimed that the bets were very small and he had only received $20,000 to $30,000.

3. The police found, on a table in the premises, 3 betting slips with a face value of $41,500 and, inside a drawer of the TV cabinet, 37 betting slips with a face value of $1,126,600.  There were also different colour pens, lists of names, phone numbers, bank accounts and a calculator, items said to be consistent with the running of a bookmaking business.

4. At subsequent interviews, the applicant made further admissions to the effect that the betting slips were made by him to record bets on soccer games received that he would pass on to someone else, but not the Jockey Club; that he laid bets for fun and would help friends by taking their bets and placing them with others; that he would pass on the bets to Ah Sing who was not connected to the Jockey Club.  The applicant also explained the various entries in the betting slips found inside the premises.

5. A gambling expert concluded, after examining the 40 betting slips, that the total value of the bets received was $1,168,100 of which $568,400 was accepted by the applicant and $599,700 was passed on to other bookmakers as an agent (teng chai).

6. The applicant had three accounts with Hang Seng Bank and one account with Bank of China.  Bank records showed that deposits of relatively small sums were made into the saving accounts in cash, cheque or ATM transfers.  Every seven days the applicant would transfer large sums ($50,000 to $100,000) to his current account and a large number of cheque payments were made from the current account, leaving only small balance.  There were a total of 2,227 transactions in the current account and 5,941 transactions in the saving accounts.

7. The applicant was a PLB operator.  The account books of his business showed a total business payment of $18,247,262 over a 54 month-period (29 November 1999 and 20 June 2004).  The total payments from the bank accounts, other than intra-account transactions in the 54 months amounted to $38,667,986.51.  The unaccounted-for amount was $20,420,724.51.

8. The applicant and his wife did not own any property other than three vehicles of minimal value registered in the applicant’s name.  They had not filed any tax return during the 54 months.

The Arrest and the Charges

9. The applicant was arrested on 20 November 2004 and put on police bail.  On 28 October 2005, his bail money was returned to him while the police continued with the investigation.  The police completed the investigation on 23 October 2009 and legal advice was sought from the Department of Justice.

10. About three years later, on 27 August 2012, the applicant was charged with bookmaking (charge 1) and “money laundering” (charge 2).  The applicant pleaded not guilty before HH Judge Browne in the District Court.  He applied for a permanent stay of the proceedings on the basis of the delay and then challenged the admissibility of his confession.

11. After a hearing that lasted 5 days, the applications were rejected and the applicant then pleaded guilty to both charges.  However, in respect of charge 2, the applicant argued that he had “laundered” only $168,748.89 and not $38,667,986.51 as alleged by the prosecution.

12. After a Newton Enquiry that last a further 3 days, the judge rejected the applicant’s account and found that the applicant had “laundered” the entire sum of $38,667,986.51.

The Sentence

13. The judge adopted the respective starting points of 4 months and 4½ years for charges 1 and 2.  On charge 1, the judge reduced the starting points by 1 month on account of the guilty plea and other mitigating factors.  On charge 2, the judge reduced the starting point by 6 months “to reflect the admission of many of the facts which were made by (the applicant) and the delay in the case coming before the court”.  The judge also took into account the fact that sentences for “money laundering” offences were not as robust at the time when the applicant committed the offences.

14. The judge ordered the sentences to run concurrently, thus making a total sentence of 4 years’ imprisonment.

The Application

15. The applicant sought leave to appeal against conviction and sentence.  By a Notice of Abandonment dated 16 December 2013, the applicant abandoned his application for leave to appeal against conviction.  This Court was therefore only concerned with the applicant’s application for leave to appeal against sentence.

16. Represented by Mr Clement Lau and Ms Carol Shek before this Court on 1 April 2014, the applicant sought leave to appeal against the sentence on charge 2 only.

17. Mr Lau did not complain against the starting points adopted by the judge, but argued that the discount given by the judge on charge 2 because of the delay and the guilty plea was insufficient.  Mr Lau emphasized that the discount given by the judge was only 11% which is significantly lower than sentence-discount in other similar cases.

18. We agreed with Mr Lau’s submission and decided to reduce the total sentence of 4 years to 43 months.  These are the reasons for our decision.

Discussion

19. The issue of the one-third discount of sentence on a guilty plea was recently further examined in HKSAR v Ma Ming (CACC 23/2012).  In paragraphs 23 to 25 of the Chinese judgment, the Court of Appeal (differently constituted) observed:

23. Since the mid 1990s the courts in Hong Kong have adopted the sentencing policy that if a defendant enters a timely plea of guilty, as a rule he is entitled to one third discount on the sentence he would otherwise receive.  In HKSAR v Chui Chi Wai & Another (No.2) [2000] 1 HKLRD 704, the Court of Appeal had this to say on page 707 E-F:

“Since the decision in R v Ng Wing Kwong (unrep CACC 62/1995) in 1995, this Court has on a number of occasions in recent years pronounced that a full one-third discount is the norm rather than the exception for a timely plea of guilty and it is only in exceptional circumstances that a lesser discount than one-third should be given.”

24. The theoretical basis of the principle of giving a discount to a defendant on his sentence who timely pleads guilty was examined by the High Court of Australia in R v Cameron [2002] 187 ALR 65.  The significance of a plea of guilty was explained by Gaudron, Gummow and Callinan JJ in their joint judgment as follows:

“It is well established that the fact that an accused person has pleaded guilty is a matter properly to be taken into account in mitigation of his or her sentence. In Siganto v R it was said:

‘…a plea of guilty is ordinarily a matter to be taken into account in mitigation: first, because it is usually evidence of some remorse on the part of the offender, and second, on the pragmatic ground that the community is spared the expense of a contested trial...’

It should at once be noted that remorse is not necessarily the only subjective matter revealed by a plea of guilty.  The plea may also indicate acceptance of responsibility and a willingness to facilitate the course of justice.”

25. Kirby J went further and clearly stated on page 81:

“…The true foundation for the discount for a plea of guilty is not a reward for remorse or its anticipated consequences but acceptance that it is in the public interest to provide the discount. Nevertheless, where genuine remorse is established to the satisfaction of the sentencing judge, it may be in the public interest to mitigate punishment further as a reinforcement for the prisoner’s resolve to avoid repetition of such conduct in the further and as an example to others. However, ‘remorse’ is not, as such, a precondition for the provision of a discount for a plea of guilty. There are other features of the public interest that need to be given weight.

The main features of the public interest, relevant to the discount for a plea of guilty…include the fact that a plea of guilty saves the community the cost and inconvenience of the trial of the prisoner which must otherwise be undertaken. It also involves a saving in costs that must otherwise be expended upon the provision of judicial and court facilities; prosecutorial operations; the supply of legal aid to accused persons; witness fees; and the fees paid, and inconvenience caused, to any jurors summoned to perform jury service…

...it is in the public interest to facilitate pleas of guilty by those who are guilty and to conserve the trial process substantially to cases where there is a real contest about guilt.  Doing this helps ease the congestion in the courts that delay the hearing of such trials as must be held.  It also encourages the clear-up rate for crime and so vindicates public confidence in the processes established to protect the community and uphold its laws.  A plea of guilty may also help the victims of crime to put their experience behind them; to receive vindication and support from their families and friends and possibly assistance from the community for injuries they have suffered.  Especially in cases of homicide and sexual offences, a plea of guilty may spare the victim or the victim’s family and friends the ordeal of having to give evidence.”

20. Mr WT Chiu, Senior Public Prosecutor, for the prosecution pointed out that the applicant had applied for a stay of proceedings and challenged the admissibility of his confession, and only pleaded guilty when those applications failed.  Mr Chiu further pointed out that having pleaded guilty, the applicant contested the prosecution case, thus necessitating the Newton Enquiry.  Mr Chiu emphasized that out of the 9 days set down for the hearing of the case, 8 days were spent to deal with those issues.

21. Mr Chiu suggested that the judge was entitled to take those matters into consideration and in the exercise of his discretion give the applicant a discount of less than one-third despite the applicant’s guilty plea.

22. A judge of course has the discretion to decide what is the appropriate discount to be given to a defendant on his plea of guilty which is not tendered timely or where there are circumstances justifying a discount which is less than the usual one-third.

23. In HKSAR v Chan Wai Ming, William (unreported CACC 53/2013), the Court of Appeal in endorsing a discount of about 18% on a guilty plea after the defendant failed to challenge the admissibility of his confession in a voir dire, said:

“…we do not think it appropriate to specify a hard and fast or particular discount where a defendant has unsuccessfully sought to exclude the evidence of a confession at a voir dire before pleading guilty; and we do not think that the court in Leung Cho Yi (unreported CACC 385/2008) (where the court considers the usual discount should be in the order of 20%) was intending to set down a rigid formula for such an eventuality. Every case is different. Some voir dires will last no more than a day, others can last more than a week with different implications in respect of public expenditure, as well as court resources in dealing with other trials…..

For a number of reasons, the trial judge is in the best position to determine as a matter of sentencing discretion the appropriate discount to be given in a particular case where a plea is entered after an adverse ruling on a voir dire.  He will have a better idea of what was involved in the issue of admissibility and of the significance of the contested evidence in the context of the overall evidence in the case.  We do not think the judge can be criticised for the discount he considered, even though another judge might have accorded the applicant a slightly more generous discount. These are matters peculiarly within the discretion of the sentencer.”

24. However, the discretion, as with any judicial discretion, must be exercised judicially and it must be well reasoned and logical.  Giving that there had been a delay of almost 8 years from the time the applicant was arrested and the time he was charged, it was not unreasonable for the applicant to apply for a stay of proceedings and such long delay also justified a reduction of sentence because of the prolonged anxiety that the applicant had to put up with.

25. On charge 1, the judge gave the applicant 25% discount (from 4 months to 3 months), but on charge 2, he only gave 11% discount (from 4 ½ years to 4 years) which is about one-third of the usual discount.

26. We were persuaded that the applicant does have a justifiable sense of grievance on the unusually small discount and it was proper that we should interfere.

27. Taking into consideration the wasted time to deal with the applicant’s applications and the Newton Enquiry on the one hand, and the 8-year delay and the guilty plea on the other, we were of the view that the proper discount of sentence should be about 20%.

28. We therefore granted leave to the applicant to appeal against sentence on charge 2.  Treating his application as the appeal proper, we allowed his appeal and reduced his sentence on charge 2 from 4 years’ imprisonment to 43 months’ imprisonment to run concurrently with the 3-month sentence on charge 1.

The Result

29. The applicant’s total sentence was reduced from 4 years to 43 months.