Kung Ting Kai, Partner of Shing Loong Pawnshop and Others v. The Queen

Case No.CACC 177/1974

Court

Court of Appeal

Date—

Judge—

Case Document

100%Judiciary

CACC000177/1974

IN THE SUPREME COURT OF HONG KONG

(APPELLATE JURISDICTION)

CRIMINAL APPEAL NO. 177 OF 1974

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BETWEEN:
	I. KUNG TING KAI, Partner of SHING LOONG PAWNSHOP	Appellants
	2.KUNG YING KAI, partner of TAK WING PAWNSHOP
	3.LO TONG, partner of CHUN ON PAWNSHOP
	4. LO SHIU HONG, partner of YAN SANG PAWNSHOP
	5. SO SHIU HONG, partner of WING CHEONG PAWNSHOP
	6. LAW LAM, partner of MAN CHEONG PAWNSHOP
	7. LO SHIU KWAN, partner of LEE CHEONG PAWNSHOP
	8. LO SAU YEE, partner of KWONG SANG PAWNSHOP
	9. LO SHIU TONG, partner of TUNG FUNG PAWNSHOP
	10. WONG MOU LAM, partner of HIP ON PAWNSHOP
	11. TSOI SEE TONG, partner of CHI SHING PAWNSHOP
	12. HO WAI HIN, partner of TING SHING PAWNSHOP
	13. CHENG FAI TONG, partner of KUNG HING PAWNSHOP
	14. MA WING SUM, partner of PO CHEONG PAWNSHOP
	and
	THE QUEEN	Respondent

Coram: Briggs, C.J.

Date of Judgment: 6th May, 1974.

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JUDGMENT

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1. This appeal arises out of the case of R. v. CHAN Tak-ki, which was tried in the Magistrates Court at South Kowloon on December 15th, 1973. In that case CHAN Tak-ki pleaded guilty to one charge of "Attempted Unlawful Pawning" contrary to section 23 of the Pawnbrokers Ordinance and to four separate charges of theft contrary to section 9 of the Theft Ordinance. He pleaded guilty to all five offences and was sentenced to terms of imprisonment for each offence totalling sixteen months.

2. At the relevant time, CHAN Tak-ki was employed as a stock-keeper in a company called the Granford Enterprises Co. Ltd., the Managing Director of which was one CHENG Luk-tak. This company sells wrist watches including watches made by a firm called Delaneau which are watches of a superior and particular style. The prices of the watches with which we are here concerned ranges from $1,264 to $4,316. They include watches of jade, lapis-lazuli, malachite and rhodonite dials. The point is that these watches are luxury articles and unusual in design. As part of his duties CHAN Tak-ki had possession of a key to a safe in which his company kept their stock of these watches. Indeed, he was the only person who had the key to that safe.

3. On December 11th, 1973, a party of police officers were carrying out a routine check at a pawnshop in Canton Road called the Ming Sang Pawnshop. CHAN Tak-ki entered the shop and tried to pawn a wrist watch. He showed an employee of the pawnbroker his Identity Card and asked to pledge it for $2,000. The employee agreed that the watch was worth all of that sum and was prepared to accept the pledge. However, the suspicions of the police officers were aroused and after asking Chan certain questions, they removed him to the police station.

4. A little later, CHAN Tak-ki confessed that he had stolen the watch from his employers, the Granford Enterprises Co. Ltd. Further inquiries revealed that he had stolen 21 watches in all: 19 of these were pawned with various pawnbrokers. He had kept the tickets and the watches were recovered, that is 19 out of the total of 21. There was, of course, in addition the one he had attempted to pawn when he was taken up by the police.

5. Having sentenced CHAN Tak-ki, the magistrate proceeded to deal with the watches which had been recovered from the various pawnshops. After hearing submissions from the owner and some of the pawnbrokers, he announced his decision in the following terms:-

"	In this case it is true that each pawnbroker who checked the police publication listing stolen property would not have found the particular piece of property listed because no report of theft had been made to the police. The theft was not discovered until the police themselves discovered it. However, apart from checking the list and checking the defendant's identity card, none of the pawnbrokers took any real steps to ensure that he was really pawning lawfully obtained property. I accept the evidence of Inspector Chan that the watches had bands apparently not worn and uncut (that is, they were obviously brand new and obviously not yet the subject of a retail sale) that therefore all should have been on their guard. Since none made any proper inquiry in circumstances where they should have been most suspicious (as the police were) but were prepared to take a business risk it is only fair that any loss resulting from that should be borne by them. I see no culpability in the owner such as to warrant his indemnifying the business loss of the pawnbrokers.
	I therefore order that the watches be returned to the owner without any payment to any pawnbroker."

Fourteen of the pawnbrokers concerned have appealed against this decision of the magistrate. They were all represented before me by Mr. Martin Lee. The owners were represented by Mr. K.F.H. Wong.

6. CHAN Tak-ki pledged three watches with the Kung Hing Pawnshop of 2D Cooke Street and one watch with each of the other thirteen firms. It appears from the record that yet another was involved. It is there stated that CHAN Tak-ki pawned three watches with the pawnbroker named Kwok Shing of 13 Graham Street, 2nd Floor. This person or firm did not appear before the magistrate nor has he lodged an appeal. I do not know if Kwok Shing was given an opportunity to be heard and did not avail himself of that opportunity. If he were not he should be given such an opportunity now for otherwise the owners have no right to the watches in question.

7. The relevant section of the Pawnbrokers Ordinance is section 30 and this read in part as follows:-

"30. (1) If in any proceedings before a court or magistrate it appears that any goods brought before such court or magistrate have been unlawfully pawned with a pawnbroker, the court or magistrate, on proof of the ownership of the goods, may order either the delivery or the non-delivery thereof to the owner -

(a)	on payment to the pawnbroker of the amount of the loan advanced by him thereon and the interest due; or
(b)	on payment of any part of such loan or interest; or
(c)	without payment of any part of such loan or interest,

	as may seem just and fitting to the court or magistrate according to the conduct of the owner and the pawnbroker and the other circumstances of the case.
	(2) No such order shall be made by the court or magistrate unless the pawnbroker and the owner have been given an opportunity of being heard."

8. CHAN Tak-ki, as I have already stated, pleaded guilty to the charges laid against him. In the usual manner there was read out a brief statement of facts with which he agreed. No evidence was therefore given on oath but the statement of facts clearly indicated that the watches were the property of the Granford Enterprises Company Limited and that Chan had stolen and pawned them unlawfully. Chan also agreed that he gambled away all the money that he had received from the pawning. The statement does not give details of each individual pawning with each individual firm.

9. On the 21st January, 1974 the magistrate heard a solicitor on behalf of the owner of the watches and another solicitor on behalf of one of the pawnbrokers involved, named Kung Hing. Kung Hing is one of the appellants. The magistrate also heard the representative from each of the other thirteen appellants. Before the magistrate none of the appellants called any evidence in support of their claims for compensation, yet the magistrate called an inspector of police. He told the court that all the watches recovered were obviously new watches and apparently had never been worn and he produced a list of the watches showing the amounts for which they were pawned and other relevant details. He also produced a photograph of the watches.

10. Mr. Lee raised two matters. He said that section 30(2) of the Pawnbrokers Ordinance had not been properly complied with in that the magistrate had not heard sworn evidence of the circumstances of the pawning of each watch, he only heard submissions made on behalf of each pawnbroker. In this connection, Mr. Lee quoted the interesting case of Chan Siu Kong v. Cheung Yuk Lin⁽¹⁾. The headnote reads as follows:-

"	A magistrate had made an order for restitution to the owner of a watch which had been pawned. No person had been charged with any offence in connection with the watch nor had the pawnbroker been notified that an application was to be made.
	The magistrate was informed of the facts of the case and the circumstances in which the watch was pawned: no evidence was given on oath."

11. The following passage of the judgment of Reynolds, J. on page 311 is relevant:-

"	The present application differs from the usual one which is generally at the conclusion of the trial for an offence where the article concerned is an exhibit and evidence has been given on oath as to ownership of the article and the circumstances in which it was pawned and where the pawnbroker or his representative has been a witness. In the latter case the magistrate will normally have all the evidence required for him to exercise his discretion under section 28 and the proper parties before him.
	In the circumstances of the present case, however, in my opinion, there were no properly constituted proceedings before the magistrate. It is necessary in a case such as the present, I consider, for the pawnbroker to be brought before the magistrate on summons, for the magistrate to hear evidence on oath to establish the ownership of the property, as to whether or not it has been unlawfully pawned and upon the conduct of the parties. Then, after giving the parties an opportunity of being heard, he is in a position to exercise his discretion under section 28."

12. It will be seen at once that the facts in this case differ from the facts in the present appeal. There was no evidence before the court in that case as to the ownership of the property and there was nothing to prove an unlawful pawning. In the present case the person who was responsible for the unlawful pawning admitted that fact to the court. The brief facts of the case stated that the pawning was unlawful and the owner of the watches was Mr. Wong's client. These facts were accepted by CHAN Tak-ki. That this is enough on which to found proceedings regarding the stolen property was recognized in a case which is quoted in the judgment of Scholes, J. in the case of Lee Tai Pawnshop v. Tam Yuk Chuen ⁽²⁾ - a case I hesitate to quote since the report was very unsatisfactory.

13. In my view, having evidence that there has been an unlawful pawning before him all that the magistrate need do to satisfy the provisions of section 30(2) of the Ordinance is to give both the owner of the goods in question and the pawnbrokers an opportunity of being heard. There is nothing to prevent the owner or the pawnbroker from giving evidence on oath of the circumstances of the pawning if they wish to do so but I do not think it is incumbent on the magistrate to call evidence on their behalf himself. He may, of course, do so, as indeed he did in the present case. A further point was made that the magistrate should have told the persons representing the pawnbrokers what their submissions should contain or, at any rate, tell them what matters would assist him to come to a proper decision.

14. The owner of the watches and one pawnbroker only were represented before him as I have already said. It appears to me from the record that the persons who addressed the court were well aware of what was wanted of them and one would expect this from persons familiar with pawnbroking procedure and practice. I do not think there is anything in this point.

15. It was also suggested that the admissions made in the brief statement of facts before the magistrate were not binding upon the appellants because they were not a party to them. This may be so but the facts, particularly the fact of the unlawful pawning, were never challenged by the appellants in any way. Indeed, I do not see how that could have been possible.

16. In my view the magistrate complied with the section. He gave each pawnbroker an opportunity of being heard and the appellants cannot succeed on this ground of appeal.

17. The second ground of appeal is that the magistrate wrongly exercised his discretion on the material that was before him.

18. The solicitor who appeared for the owner clearly stated that CHAN Tak-ki had only been with the company for a few months and was on probation; that he was recommended to the company by a reputable person and that he was a satisfactory employee. The offences took place soon after a stock-taking, which was done every two or three months. The period during which the offences took place was just under three months from September 12th to December 9th. Unfortunately, the person who recommended Chan to the company did not know or, at least, did not inform the company that Chan had a previous criminal record in that he had been convicted and fined for certain offences of obtaining by deception in 1971.

19. It was also pointed out to the court that the pawnbrokers should have been put very much on their guard since the watches were obviously brand new and of an unusual make and design and were very expensive articles. As I have said, the magistrate had a description and photographs of the watches before him.

20. In the case of Kung Hing, Chan pawned an expensive new watch on September 12th. This he redeemed three days later only to pawn it again on October 2nd. Again it was redeemed on October 5th. Then on November 20th, 26th and on December 7th he pawned three expensive watches, one of which was the watch he originally pawned.

21. The solicitor who appeared for Kung Hing before the magistrate told the court that Kung Hing thought that CHAN Tak-ki was engaged in smuggling watches into Taiwan. This should have put the pawnbroker on his guard at once. Section 24 of the Pawnbrokers Ordinance is directly in point. Chan should have been seized and detained under that section there and then.

22. Some of the representatives of the appellants appear not to have asked to see Chan's Identity Card, for example, Hip On, Yan Sang, Chi Shing. All, or nearly all of the representatives noticed that the watch brought for pawning was a new and an expensive watch and that Chan asked for a sum greatly below its value. But they made no further check. In one case, a note was made of Chan's address but that was not checked. In several cases, a receipt was asked for but one was apparently never produced and no one seems to have thought of finding out who the agents for Delaneau watches were.

23. I agree with the reasons given for his decision by the magistrate. He saw and heard the owners and the representatives and I cannot find anything in his decision which I have quoted above which makes me think that he has not exercised his discretion under the Ordinance correctly.

24. The appeals therefore are dismissed and I make no order for costs.

Briggs, C.J

Representation:

(1) (1956) 40 H.K.L.R. 309.

(2) (1959) H.K.L.R. 398.