THE QUEEN v CHAN KWOK CHEUNG

IN THE SUPREME COURT OF HONG KOAG

(Appellate Jurisdiction)

MAGISTRACY CRIMINAL APPEAL NO. 139 OF 1989]

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BETWEEN

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REASONS FOR JUDGMENT

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1. On the 16th December 1988 the appellant was convicted, on his own plea, in the Magistrates Court at Tuen Mun in respect of an offence of using a motor vehicle on the 23rd August 1988 without there being third party insurance. On the 30th December 1988 he was fined $800 and disqualified from holding a driving licence for medium goods vehicles, i.e. Class 18 for 12 months.

2. It is against this disqualification that he now appeals. The appellant admitted driving kiss medium goods vehicle on the day in question without third party insurance, but gave evidence with a view to showing that he had a special reason why he should not be disqualified within the meaning of Section 4(2)(a) of the Motor Vehicles Insurance (Third Party Risks) Ordinance, Cap. 272.

3. The learned magistrate summarised his evidence as follows:-

"...on about 4/8/88 he handed his application for renewal of the insurance policy of his goods vehicle to his colleague Lam Chun Ming and asked him to arrange for a renewal. He knew that Lam would arrange for the renewal with an insurance agent Mr Luk Ka Chung. He did it once in the preceding year and nothing went wrong. On about 16/8/88 he asked Lam about the renewed policy and was assured by Lam that it would be alright. He did not suspect anything untoward as it was a common practice among his fellow drivers to rely on Lam to make the necessary arrangement and normally the renewed policy would reach them two weeks after the expiry of the previous insurance policy and they were not required to pay until they received the renewed insurance policy. He believed he had his insurance policy duly renewed and he continued to drive the goods vehicle after the 18/8/88, the date the previous insurance policy expired."

4. The appellant called Mr LAM Chun-wing (DW2) and Mr LAM Chat-chun (DW3) to support his evidence about the practice of the drivers to let Mr LAM Chun-wing handle the renewal of their policies. Lam Chun-wing (DW2) gave evidence that this practice had been going on for six years. It never happened that any of these insurance policies expired without being renewed. The appellant had asked him on the 22nd or 23rd whether he had purchased the policy for him and he told the appellant it had already been purchased. LAM Chat-chun (DW3) also confirmed the practice.

5. The magistrate stated that, he was satisfied on a balance of probabilities that what the appellant and his witnesses had told him was true and he was aware that an honest belief, if made on good grounds, that the policy was renewed, would amount to a special reason. However, he said that he was satisfied that Lam was not an insurance agent and could not represent one and that he could not see any valid ground for the appellant to believe what Lam had told him. He stated that he could not see how the appellant could have been misled and he was satisfied that the appellant had shown no special reason why he should not be disqualified.

6. The magistrate had, in addition to the statement of findings, delivered a finding at the end of the hearing in which he said:-

"Defendant must show that he was in some way misled honest but groundless belief that the policy had been issued cannot amount to special reason. DW2 is not an employee of the insurance company. It is foolish for the defendant to believe his words. He drove his vehicle without having looked at renewed policy is another foolish act. He was aware that his insurance policy expired towards the third half of August but held a groundless belief that a renewed policy had been issued. I am satisfied that the reasons put forward by the defence do not amount to special reason and accordingly I make the following order."

He then went on to disqualify him.

7. Mr McCoy, who represents the appellant on this appeal, takes exception to the magistrate's finding that the appellant's reason for believing that an insurance policy had been issued were groundless. He relies on the common practice as established by the defence witnesses that the drivers relied upon Lam to obtain renewal of their insurance policies and the fact that the policies had been renewed as a result of Lam's actions in the past and that the appellant himself had had a former policy renewed through the agency of Lam. He also argues that because of the very severe consequences to the defendant of an order of disqualification the court should put the facts under very close scrutiny in appeals of this sort.

8. Mr Bruce for the Crown opposes the appeal on the basis that the question of what are reasonable grounds is a question of fact for the magistrate to decide on the individual facts of the case and that he has a discretion to disqualify or not. He also emphasizes the serious consequences that can flow from the driving of a motor vehicle without third party insurance. In these circumstances, he argues that the Court should be slow to interfere with the magistrate's order.

9. I am indebted to both counsel for reference to authority, both in the United Kingdom and Hong Kong.

10. In particular in Lee Kam-to v. The Queen Cr. App. No. 430 of 1980, Roberts C.J. (as he then was) held that a belief by a defendant that an insurance policy was still in force may amount to "special reasons" for not imposing a disqualification, if that belief was based on reasonable grounds. The facts in that case were set out in a very short judgment as follows:-

"The defendant pleaded guilty to causing another person to use a motor vehicle on the road without third party insurance. He was fined $1,000 and disqualified for a period of 12 months.

The defendant gave evidence before the magistrate that the car had only belonged to him for about a week and that when it was transferred to him, a friend of the previous owner (Mr Suen) told him that the car was covered by insurance.

He added that Mr Suen had put the car in a garage for repair and had handed the insurance documents to the garage company.

The magistrate mentions this evidence in his statement of findings, but does not say whether or not he accepts it. On the assumption that he did, it seems to me, though not without hesitation, that a belief by a defendant that an insurance policy is still in force, does amount to 'special reasons' for not imposing a disqualification, if the defendant's belief was based on reasonable grounds.

I thought that his belief could be so described and accordingly removed the disqualification imposed by the magistrate but did not interfere with the fine."

11. This decision was followed by Bewley, J. in The Queen and Cheung Chu-bor M.A. No. 655 of 1988 where he set aside an order for disqualification on the basis that the appellant held an honest belief based on reasonable grounds that he was permitted to drive on a Canadian driving licence

12. In the present case the learned magistrate in fact accepted the evidence of the appellant and his witnesses unlike LEE Kam-to's case, where the magistrate didn't say that he accepted the defence evidence. With respect to him, having accepted that what the appellant did was a common practice and that the appellant did believe that his insurance policy had been renewed, and that the belief was based upon what had happened before during the previous six years when Lam had assisted the drivers to renew their insurance policies by dealing with an insurance broker Luk Ka Cheung, and that Lam had told the appellant that the policy had been purchased for him when he had asked on the 22nd or 23rd of August, I consider that the appellant had reasonable grounds for believing on 27th August that his policy had been issued. There was, in fact, no reason for him to have any doubt that his policy had been issued. There were no circumstances in this case which would have given the insurance company a reason for perhaps having any reservations about renewing the policy. It was a straightforward expiry and renewal situation.

13. The decision to disqualify is a discretionary one and the magistrate must have in mind the interests of the public having regard to the circumstances of the offence in deciding whether to exercise his discretion and nullify the mandatory provisions of the ordinance.

14. In all the circumstances, I consider that the magistrate was wrong to hold in effect that the evidence was not capable of establishing a special reason. Furthermore, there is no reason to suppose from the circumstances of this offence that if the appellant is allowed to drive a motor vehicle in the future that the public will be placed in any way at risk.

15. For these reasons I allow the appeal and set aside the order for disqualification.