Ngan Lun Yan v. The Queen

CACC000212/1975

IN THE SUPREME COURT OF HONG KONG

(APPELLATE JURISDICTION)

CRIMINAL APPEAL NO. 212 OF 1975

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Coram: Briggs, C.J., Huggins & McMullin, JJ.

Date of Judgment: 2nd May 1975.

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JUDGMENT

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Huggins, J.:

1. This appeal originally came before me and on the application of counsel for the Appellant I referred it to the Full Court because it raised a question of interpretation of some importance. It is an appeal against convictions and sentences.

2. Two charges were laid against the Appellant in the court below, both under s.9(2) of the Prevention of Bribery Ordinance. The circumstances were as follows. The Appellant owned a factory in a multi-storey building. He insured his property under three standard forms of fire policy. A fire occurred on an upper storey of the building and the Appellant suffered water damage as a result of the fire fighting operation. He made a claim and the insurers appointed a firm of loss adjusters to act on their behalf. They sent an employee to survey the damage and to interview the Appellant. A few days later another fire broke out, this time in the Appellant's own premises, and he sustained further loss. He made a claim and the insurers appointed other loss adjusters to act for them. They likewise sent an employee to survey the damage and to interview the Appellant. To one of these employees the Appellant said: "I will give you 10% on a quick set lement": to the other he made several approaches with the apparent aim of having the claim settled quickly and when these were repulsed the Appellant left on the employee's desk an envelope containing $10,000. The offer to one employee and the payment to the other were the subject of Charge B and Charge A respectively. The contention on behalf of the Appellant is that these facts did not disclose any offence.

3. It will clear the way if we deal first with the argument that the evidence did not support a finding in relation to Charge B that an offer was made to the employee. This argument depends upon the interpretation of the word "you" in the offer itself. It is very properly conceded by counsel for the Crown that if the suggestion being made by the Appellant when he made the offer was that he would accept from the insurers only 90% of the amount he had claimed if they would make a quick settlement there would be no offence: the Ordinance was never intended to interfere with normal commercial bargaining between principals. It is sufficient to say that on all the evidence we are satisfied that the learned magistrate was justified in interpreting the offer as an offer to the employee personally.

4. The material part of s. 9(2) is this:

"Any person who, without lawful authority or reasonable excuse, offers any advantage to any agent as an inducement to ...... -

shall be guilty of an offence"

and the first argument relating to both charges is that, contrary to the opinion of the learned magistrate, dishonesty is an essential ingredient of an offence under the subsection. It is clear that by "dishonesty" the magistrate meant the offering or giving of an advantage to attain an end which was itself dishonest, as distinct from the attaining of an end in itself honest by dishonest means. The contention is that the end itself must be dishonest. In the present case there is no suggestion that the expediting of a settlement was inherently dishonest: what the Crown alleged was that the means adopted to obtain expedition were contrary to the statute. It was suggested that the language used by the Legislature was not sufficiently clear to produce what, it was said, was a highly inconvenient result, namely that honest persons could be convicted of an offence for doing nothing more than seek to attain a perfectly legitimate end. We do not agree. The manifest intention of the Legislature was to proscribe the offering, demanding, giving and receiving of what may generically be termed secret commissions. An employee ought to be paid by his employer and not, save with his employer's consent, by persons dealing with the employer. The law has long recognised that an employee who receives a secret commission is liable to his employer to the extent of that commission: it is dishonest for him to accept it. It is no less dishonest for a person knowingly to pay a secret commission. Of course it is also dishonest for employee to accept a secret commission in return for his acting in a manner which causes or is liable to cause the employer actual loss, but it is not necessary that such loss or prospective loss shall be proved. As was said in the course of the argument, the only possible justification for the payment of a gratuity to someone else's employee is the express or implied consent of the employer.

5. That brings us to the submission that the "lawful authority or reasonable excuse" which is repeatedly referred to in the statute cannot always come from the same source: that is to say that, the person who can give authority for the offering or payment of an advantage will inevitably be someone other than the person who can give authority for the demanding or accepting of that advantage. In the present case, the argument goes, we are not concerned with the fact that the employees of the two firms of adjusters had no lawful authority or excuse for accepting the advantage but with the fact that the Appellant, being self-employed, could authorise himself to offer or give the advantage. Counsel concedes that the Legislature probably thought it had covered a case like the present, but he submits that the statute must be construed strictly and that the words used leave a lacuna. It is a bold argument but none the worse for that: if it were on a solid foundation we would be bound to adopt it. However, in our view we are not compelled to interpret the language of the statute in this way. The clear intention being to proscribe secret commissions it would be absurd to hold that a person may nevertheless lawfully give himself authority to offer or to pay such a commission. Equally it would be absurd to suggest that a person could lawfully be given authority by his own employer to offer or to pay a commission which the statute has proscribed. It is only the employer of the receiving agent who can give lawful authority either to the receiver or to the giver, subject to the proviso that established custom may give an implied authority unless it is expressly withdrawn.

6. That leaves us with the final contention that the inducement "to expedite the claim" referred to in both charges was not an inducement within the contemplation of the Legislature in enacting s. 9(2), which speaks only of "showing or forbearing .... favour or disfavour". The strength of this contention lies in the fact that the draftsman expressly included the word "expediting" in s. 4(1)(b) and in s. 4(2)(b), which deal with offences by Crown servants: thus it permits of the argument that a difference of language in the same statute must be assumed to have been intended to convey a different meaning. It was this point which led me to accede to the application to refer the appeal for the consideration of this Court, but in the event we are all firmly of opinion that the point is without real substance. We must give the words of s.9(2) their ordinary meaning and even on the narrwest interpretation of them they must include expediting a claim. Why the draftsman thought it necessary or desirable to put the word "expediting" into s. 4 we do not know, but it is enough that we are unable to find any fair interpretation of s. 9(2) which would exclude the expediting of a claim.

7. For these reasons the appeal against conviction is dismissed.

8. The Appellant was fined $5,000 on each of the two charges and the $10,000 paid by the Appellant to one of the employees was ordered to be confiscated. The substance of the arguments addressed to us was that there was such uncertainty whether what the Appellant had done constituted any offence that only a nominal sentence was appropriate. In our view there can be no doubt in anybody's mind that what the Appellant was doing was something which the Legislature intended to prohibit. If the Appellant chose to gamble on the possibility that the Legislature had not expressed its obvious intention with sufficient clarity, that was his affair and, having lost, he is not entitled to a reduced sentence on that account. We think he was fortunate that he was not sent to prison.

9. The appeal against sentence is also dismissed.

2nd May 1975.

Representation: