HKSAR v. YEUNG TIN CHI

HCMA970/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

(Appellate Jurisdiction)

MAGISTRACY APPEAL NO. 970 OF 2002

(On appeal from NKCC 5229 of 2002)

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J U D G M E N T

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1. This is an appeal against sentence only, the appellant's appeal against conviction having been withdrawn and dismissed. The appellant was convicted after trial of an offence of possession for sale, trade or manufacture goods to which a forged trademark was applied, contrary to sections 9(2) and 18(1) of the Trade Descriptions Ordinance, Cap.362. He was sentenced to nine months' imprisonment. He appeals that sentence on the basis it was too severe.

2. The facts of the case were that the appellant, a watch manufacturer in business in an industrial building in Kowloon, was visited by Customs officers on the charged date, and there the appellant was found to be in possession of some 8,800 watch parts and watches to which forged trademarks "Nike", "Fila" and "Adidas" were applied. The appellant's business was the assembly of watches, and the magistrate found that the offending watch parts were to be used for the purposes of that business.

3. In arriving at her sentence, the magistrate said that she treated the appellant as a wholesale trader or dealer in watch parts, and with reference to the authority of The Secretary for Justice v. Lam Chi Wah [1999] 4 HKC 343 adopted as a starting point of sentence 12 months' imprisonment which she reduced to nine months' imprisonment on the basis of various factors advanced in mitigation, including the appellant's good character as evidenced by his clear record.

4. Firstly, Mr Wong for the appellant argues that the magistrate was wrong in principle to rely upon Lam Chi Wah as suggesting an appropriate starting point of sentence in the present case of 12 months' imprisonment. He says that the court in Lam's case was at pains to point out it was not setting out any guidelines for sentence in respect of these offences and that, accordingly, there are no such guidelines and the magistrate was wrong to believe that Lam's case did purport to so establish any such guidelines.

5. It is true that in Lam's case, Chan CJHC (as he then was) stated :

".... We do not think this is the appropriate opportunity to set any guideline for offences under the Trade Descriptions Ordinance. First we have not been provided with any material from the prosecution as to the extent of the prevalence or seriousness of this type of offences. Secondly, there are no doubt quite a variety of circumstances regarding the possession and sale of counterfeit goods. This would make the setting of guidelines rather difficult. ...."

And it must be accepted that the Court of Appeal has deliberately refrained from setting guidelines for the sentencing of this sort of offence. But that does not mean that sentencing magistrates cannot have reference to cases such as Lam's case in their consideration of sentence in particular cases before them so long as they appreciate that no guidelines in respect of sentence are established by such cases.

6. In the present case, there is nothing to suggest the magistrate mistakenly believed Lam's case purported to set guidelines so far as sentences for the present offence are concerned. The magistrate simply cited that authority as some comparative support for her finding that a starting point of sentence of 12 months' imprisonment was appropriate for a wholesaler of forged goods.

7. Mr Wong further argues, however, that in any event even if a starting point of 12 months was thought to be appropriate in Lam's case, then the present case can be distinguished on its facts so that a significantly lower starting point should have been adopted.

8. I think in this regard Mr Wong is on stronger ground. Lam's case involved some $500,000 worth of 14,000 completed forged trademark goods. The value of the goods in the present case was $18,900 and involved some 8,800 second-hand parts and items. Mr Wong argues that the culpability of the present appellant is accordingly not so high as the appellant in Lam's case and that the starting point of sentence in the present case should have therefore been lower.

9. Implicitly his argument is that the magistrate in using Lam's case as a comparison omitted to consider properly factors which existed in the present case. I think that is so. There is a significantly lower number of offending items involved in the present case, and the nature and number of such items is a factor to be taken into account in arriving at an appropriate sentence in cases such as the present.

10. Further and significantly in Lam's case, the appellant was regarded by the court as a persistent offender. That is an aggravating factor which is absent in the present case. The appellant here has a clear record.

11. In both cases, the role of the appellant was that of a wholesaler. It may be that as the present appellant was a manufacturer, his role may be somewhat more culpable, but I agree with Mr Wong's proposition that given the disparity between type quantity and value of the items and the background history of the present appellant, in the sense that there is no aggravating factor such as that which was in existence in Lam's case present for the purposes of consideration of sentence, some differentiation in starting point of sentence would have been appropriate.

12. In my judgment, given these factors, an appropriate starting point of sentence in the present case would have been eight months' imprisonment. Given the mitigation advanced by the appellant and accepted by the magistrate, that starting point of sentence should have been reduced to a sentence of six months' imprisonment.

13. In this regard, I should also say that in my judgment no further weight in mitigation should be placed upon the evidence of the appellant's positive good character which was adduced before me showing his connection to various charitable and communal institutions relating to overseas Chinese returning to Fujian province. Whilst the appellant's interest and involvement in these organizations are commendable aspects of his character, he has already been given a significant and generous discount of sentence, both before the magistrate and on this appeal. A large part of that discount relates to the appellant's good character as evidenced by his clear record. In those circumstances, any further reduction of sentence based on good character would have been disproportionate.

14. The final complaint of Mr Wong was that the magistrate was wrong to have rejected other non-custodial sentencing options, such as suspending the imposed term of imprisonment or making a community services order, particularly given the appellant's previous clear record.

15. In Lam Chi Wah, Chan CJHC, in delivering the judgment of the court, said after dealing with the position of mere hawkers of counterfeit goods :

".... On the other hand, for wholesalers, they would have to face prison terms unless there are special circumstances. We would hasten to add that financial difficulties and a clear record would be unlikely to be regarded as special circumstances."

16. Mr Wong says nevertheless, the magistrate should have considered imposing a suspended sentence or an order of community service rather than a sentence of immediate imprisonment. The initial answer to this complaint is that she did. In her Reasons for Sentence, she said :

".... Defendant was in fact running a business of watch manufacturing. He could be considered as a wholesaler. Due to the serious nature, I do not consider a suspended sentence or a community service order is an appropriate way to deal with the case. I consider an immediate custodial sentence is an appropriate way to deal with the case."

The magistrate was perfectly entitled to arrive at that conclusion.

17. In further answer to Mr Wong's complaints in this regard, I do not see how the imposition of a sentence of immediate imprisonment can be said to be wrong in principle given the comments of Chan CJHC in Lam Chi Wah set out immediately above.

18. There has obviously been, through cases such as R. v. Ng Wen Chien [1987] 1 HKC 516 and HKSAR v. Lau Wing [1998] 2 HKC 747 leading up to the judgment in Lam Chi Wah itself, a growing acceptance of the serious nature of these offences and of the requirement of deterrent sentences. The magistrate recognized this in her Reasons for Sentence. Offences such as the present are serious and warrant deterrent sentences because their effect extends beyond our shores and impinges upon our international business and trading reputation. The magistrate was entitled to impose an immediate custodial sentence as a deterrent sentence given the nature and scale of the offence and the appellant's role therein.

19. More specifically, the magistrate's decision to not impose a community services order on the appellant cannot be criticized. The appellant showed no remorse at trial. He pleaded not guilty. He subsequently, before its late withdrawal before me, sought to appeal his conviction. In those circumstances, the magistrate's decision not to make an order of community service cannot be said to be inappropriate. A defendant's remorse is a significant factor in determining whether a community services order would be appropriate in a particular case.

20. Accordingly, then, for the reasons given above, the magistrate's sentence of nine months' imprisonment is set aside and a sentence of six months' imprisonment is substituted.