R. v. Peter Bernd Beckers
Read the full judgment text of CACC 246/1990 on BabelCite. This Court of Appeal judgment was delivered on 11 September 1992.
1. The applicant was convicted after a re-trial before Deputy Judge Leong (as he then was) and a jury on four counts of conspiracy to accept advantages as agents contrary to common law and section 9(1)(a) of the Prevention of Bribery Ordinance, Cap. 201. ("the Ordinance").
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CACC000246/1990
---------------------------------- Coram: Hon. Silke, V.P., Macdougall, J.A. & Bewley J. Date of hearing: 26-28 May and 28 August 1992 Date of judgment: 11 September 1992 -------------------------------------------------- JUDGMENT OF THE COURT -------------------------------------------------- Macdougall, J.A.: 1. The applicant was convicted after a re-trial before Deputy Judge Leong (as he then was) and a jury on four counts of conspiracy to accept advantages as agents contrary to common law and section 9(1)(a) of the Prevention of Bribery Ordinance, Cap. 201. ("the Ordinance"). 2. These four counts, which were the only counts on the indictment, corresponded with counts 1, 4, 5 and 11 on an indictment on which the applicant had earlier been tried and convicted. Those convictions had been quashed on appeal and a re-trial on a fresh indictment ordered. The applicant had been acquitted at the earlier trial on the other four counts in the first indictment. 3. Count 1 in the fresh indictment which was substituted for count l in the old indictment "reads
PARTICULARS OF OFFENCE
4. At the first trial three other persons were named as defendants in count 1. Since they had failed to answer to their bail at that trial and were not available at the re-trial they were referred to in count 1 in the fresh indictment as co-conspirators, not defendants. There are, however, other differences between the old count 1, as amended at the first trial, and the new count 1. These are apparent from a comparison of both counts. The old amended count 1 reads:
5. The emphasised words do not appear in count 1 in the fresh indictment. 6. Count 2 in the fresh indictment is, except in one minor immaterial respect, identical with count 4 in the old indictment. It reads:
7. Count 3 in the fresh indictment is in all material respects the same as count 5 in the old indictment. It reads:
8. Count 4 in the fresh indictment is the same as count 11 in the old indictment. It reads
9. The case for the prosecution was that, during the referred to in the four counts, the applicant was the general manager of Swire Air Caterers Limited ("SACL"), a company which is jointly owned by Cathay Pacific Airways Limited ("Cathay Pacific") and Hong Kong and Shanghai Hotels Limited. It was an express term of his contract of employment that employees were not permitted to accept advantages. No permission had ever been given to the applicant by his employers to accept any advantage. 10. The principal witnesses for the prosecution were a MR. Keefe Ho Lam-pui ("Ho"), an admitted co-conspirator in the conspiracy referred to in each count, and Helen Yeung, an admitted co-conspirator in respect of the conspiracies to which counts 2, 3 and 4 related. Ho had been granted an immunity from prosecution on condition that he would give full and true evidence. Helen Yeung, on the other hand, had, on her pleas of guilty, been convicted of offences which it was alleged that the applicant was a co-conspirator. She was, however, granted immunity in respect of any criminal offence connected with those alleged against the applicant which she had already disclosed to officers of the ICAC and would disclose in the course of her testimony at the applicant's trial. 11. Ho's testimony was as follows. In 1972 he joined SACL. He then came to know Wong Leung-fuk ("Wong") and Ki Hon ("Ki"). In September 1972 Uwe Kaiser ("Kaiser") joined SACL and six months later became the general manager. In 1977 Ho became assistant general manager of operations and administration. He and Kaiser developed a close friendship. Around Christmas in 1978 Wong handed to Ho a cash coupon that Wong had received from Fung Chi-wai ("Fung"), the proprietor of a company named Woo Kee which supplied goods to SACL. Ho then had a discussion with Kaiser in which they conceived the idea of obtaining advantages from SACL's suppliers. Following this, Ho approached Wong, who was then in charge of purchases for SACL and was therefore familiar with all the suppliers, and told him what he and Kaiser had in mind. Wong readily agreed and told Ho that there would be no problem in arranging matters. Two or three months later Wong began paying Ho between $200 and $3000 every few months. These secret commissions came from the suppliers of tinned food, vegetables, prawns, ducks and certain special foods. This was referred to as "pot money" which was to be shared equally between Ho and Kaiser after the deduction of expenses incurred by Ho. It was later to be known as "the Wong Pot". 12. Sometime later Kaiser and HO decided to obtain an alternative vegetable supplier. Ho then contacted Anthony Chan Shing-mun ("Chan"), a man whom he had come to know when he was employed by Jardine Airways prior to leaving that company for employment with SACL. Chan operated Wing Kee vegetable company. Shortly afterwards, Wing Kee was awarded a contract to supply SACL with vegetables. Chan paid Ho a commission in the region of $2000 to $3000 for the contract and thenceforwards gave him a monthly sum which varied according to the value of the orders given to Wing Kee by SACL. Again, these sums were paid into a pot to be shared by Kaiser and Ho. This was known as "the Chan pot". 13. In late 1978 the applicant joined SACL as an assistant general manager in charge of production and purchase. It became apparent to Ho that Kaiser would eventually be transferred to Cathay Pacific and that the applicant, being a European, would be Kaiser's successor. Some time later there was a meeting between Kaiser, Ho and the applicant at Kaiser's home at which Kaiser told the applicant to look after Ho. Later again, Kaiser and HO agreed that the applicant should be brought into the scheme of accepting advantages from suppliers. 14. In order to facilitate this arrangement by ingratiating himself with the applicant, Ho presented him with an IWC watch that was paid for out of the "pot money". Ho told the applicant that money had been coming through Wong but did not mention to him its actual source. He added that Wong would hand over more money during the following week. At the time of telling him this he made a gesture which indicated that it was from illicit commissions. The applicant smiled. Later on, he told Ho that he was receiving money from Wong. 15. In 1980, when Kaiser was about to be transferred to Cathay Pacific, Kaiser, Ho and the applicant came to an agreement that all the money that was being received should be shared between them. At this stage the applicant had not been aware of "the Chan pot", but had been receiving money from "the Wong pot" directly from Wong. On being promoted to Kaiser's position, the applicant told Ho that he no longer wanted to have direct contact with Wong. Wong therefore paid money to Ho who in turn paid the applicant's share to the applicant and retained Kaiser's share to be handed to him in due course. He also told the applicant about the advantages that were being received from Chan and paid him a share from "the Chan pot". 16. In the second half of 1980 payments from Wong became irregular. The applicant told Ho that he wanted regular monthly payments. As a result, Ho arranged with Wong that Wong would pay between $30,000 and $40,000 monthly. The applicant and Ho agreed that Kaiser should receive a fixed monthly sum of $10,000 and that they, Ho and the applicant, would share the balance. 17. It was at about this time that Klaus Spieker became employed by SACL. He began asking awkward questions about money. Ho, fearing that Spieker would create difficulties, unless he was brought into the conspiracy, suggested to the applicant that Spieker should share in the pot. The applicant was not in favour of this suggestion. Notwithstanding the applicant's opposition, Ho approached Spieker and, as he had done with the applicant, eased him into the conspiracy with the gift of a Cartier watch and told him that he would be receiving money from the suppliers of goods to SACL. The applicant was told of what Ho had done. The arrangement then became as follows From the monies which Wong was receiving from suppliers he paid $5000 to Spieker and the balance to Ho. Ho in turn paid $10,000 to Kaiser and retained the balance to be shared equally between himself and the applicant. 18. In 1981 and 1982 SACL was seeking an alternative supplier of dry ice. At the applicant's request, Ho arranged a meeting between the applicant, Ho, Helen Yeung and her associate Mr. Lam Yan-kwai ("Lam"). Eventually the applicant and Ho agreed to offer the SACL contract for the supply of dry ice to Helen Yeung and Lam who in turn agreed to allow the applicant and Ho to participate in the investment by forming a company named Edstrom Limited. ("Edstrom") of which Helen Yeung and Lam were appointed as directors. Ho and the applicant took a 10% shareholding but, since they both found it necessary to conceal their activities in Edstrom, neither could be a director. Chan of 'the Chan pot' was therefore appointed as a director in order to protect their interests. The applicant and Ho advanced between them $100,000 as capital to set up Edstrom. 19. It was agreed that, apart from their share of Edstrom's profits, Ho and the applicant would receive 10 cents secret commission per kilogram, of dry ice supplied to SACL. The average monthly supply was between 40,000 and 60,000 kilograms. Helen Yeung paid the commission in cash every month to Ho who shared it equally with the applicant. It ranged from $5000 to $6000 a month. 20. Between the end of 1982 and early 1983 Helen Yeung and Lam required further capital for the company. This did not suit Ho and the applicant, so Ho told Helen Yeung that they wanted to withdraw from Edstrom. She agreed and made a partial repayment of capital to Ho and the applicant. This did not please the applicant. Ho again approached Helen Yeung who then repaid the balance of the capital jointly subscribed by Ho and the applicant. This sum should have been shared between Ho and the applicant but, in order to keep the applicant happy and to maintain the supply of dry ice and thus the receipt of commission, Ho gave his share of the balance of returned capital to the applicant. 21. In 1982 Helen Yeung set up Richgo Trading Company Limited ("Richgo"). This company took over the contract to supply dry ice to SACL. The practice of paying Ho and the applicant 10 cents secret commission supplied to SACL continued. Spieker eventually became aware of these payments. Because of this, and notwithstanding that the applicant thought that it was unnecessary to do so, Spieker was given a monthly payment of $750 from this source in addition to his share in 'the Chan pot' and 'the Wong pot'. 22. Also in 1982, Kaiser, acting on behalf of Cathay Pacific, instructed Ho and the applicant to find a source of supply of chocolate for Cathay Pacific. Ho contacted Helen Yeung who produced from Societe des Cinqs Limited samples of chocolate which were acceptable to Kaiser. Kaiser, Ho and the applicant then arranged with Helen Yeung that she should pay them 15 cents for every bar of chocolate supplied to SACL for Cathay Pacific. 23. After Helen Yeung founded Richgo, the supply from Societe des Cinqs Limited was discontinued and, as a result of correspondence between the applicant on behalf of SACL and Helen Yeung, a new contract for the supply of chocolate to SACL was awarded to Richgo. It was arranged that Kaiser, Ho and the applicant would receive a 15 cents secret commission for every bar of chocolate supplied to SACL. Ho also came to a secret arrangement with Helen Yeung that he would receive for himself a further 10 cents commission. However, owing to cash flow problems, Helen Yeung was unable to honour this private arrangement with Ho. 24. There were by this time four sources of secret commission: those paid into 'the Wong pot', those paid into 'the Chan pot', 'the dry ice pot' and 'the chocolate pot'. The applicant asked Ho to provide him with a breakdown of the various amounts coming from each source. In response to this request Ho told Wong to prepare a breakdown of the money received by him every month. Ho would then prepare a new list in which he added to Wong's breakdown particulars of other sources of income. He would then present this overall breakdown to the applicant. The new list would specify both the various items such as "general", "duck", "chocolate" and "dry ice" and the amounts received in respect of each of them. 25. There was evidence from Mr. Morris of ICAC that in the course of a search conducted at the applicant's residence he found an exercise book which, inter alia, contained handwritten accounts relating to the months of September, October and November and which specified under each of those months amounts received in respect of "chocolate", "d/ice', "general", "duck", "commissary" and "etc". The total receipts for those months ranged from $25,989 to $31,000. Although these accounts were not written by the applicant - indeed he testified that they had been written by his wife and related to her own business affairs in a company called Preciso International which dealt with food items such as frozen poultry including ducks and chickens, and other frozen foods - they followed the same pattern, but with less detail, as the written breakdowns which Ho testified he had presented to the applicant. Ho explained that "commissary" is the term used for food products that do not require any preparation or cooking by the air crew, and that 'etc' referred to general items. Mr. Morris testified that, when he opened the notebook in front of the applicant at the pages on which these accounts were written, the applicant's face betrayed a look of horror. 26. In addition to the references in the notebook to the various commodities, there was an entry in the debit column for the September account of a second payment of $2000 to Opa for a dynasty horse. 27. Opa, which is German for grandfather, was the nickname by which the applicant and Kaiser addressed Ho. Ho testified that had bought the dynasty horse in Shanghai for the applicant who was to pay for it in two or three instalments from the pot money. The applicant's version, however, was that Ho had not bought the horse for him but that he had bought it himself as a present for his grandfather, and that he thought that he had paid $2000 or $2500 for it at a shop in Hollywood Road whose name he could not remember. The difficulty with this explanation was that the entry in the notebook reads "pay to Opa for dynasty horse", not "pay for dynasty horse for Opa" or words to that effect. The entries were therefore consistent with Ho's testimony as to his practice of providing the applicant with breakdowns of the secret commissions and of the setting off of the cost of the dynasty horse from the applicant's share of the pot money. There was no evidence from the applicant's wife as to the significance of these entries or the activities of Preciso, for the applicant, as he was entitled to do, did not call her as a witness. 28. Ho further testified that, with the applicant's approval, Spieker's monthly share in 'the Wong pot' increased from $5000 to $8000. As a result of discussions between the applicant and Ho as to how they could obtain further commissions, Ho instructed Chan to set up a company to supply vegetables to SACL. Chan set up a company called Perfectional Food Provisions Company ("Perfectional") with his own capital. Seven per cent of the value of orders placed with Perfectional by SACL was paid into "the Chan pot" which now consisted of payments from Woo Kee and Perfectional. It was arranged that 15% of this pot was to go to Spieker and that the applicant and Ho would share the balance. 29. In 1983 "the Chan pot" was receiving around $30,000 monthly. Then, because of SACL policy that purchase orders to any one supplier should not exceed $500,000, it became necessary for Chan, who also operated a company called Flamingle Trading Company ("Flamingle") which was supplying prawns to SACL, to set up yet another company. This was called Harvest Trading Company ("Harvest"). Although the applicant and Ho were forbidden by the terms of their employment with SACL to engage in other business ventures, there was no evidence that the supply of food items from Harvest to SACL was anything other than a normal business transaction without secret commissions being involved. It seems that this was the reason that the prosecution at the first trial obtained leave to amend count 1 in the indictment by deleting the reference to Harvest. 30. On two occasions the applicant and Ho shared secret commissions obtained from Flamingle. On the first occasion the amount was $50,000. The applicant, however, was not happy with this. Ho discussed the matter with Chan and, as a result, the applicant was paid a further $25,000. On the second occasion an amount of $120,000 was involved. In order to keep the applicant happy and to avoid having to return to Chan to press for further money for the applicant, Ho gave $100,000 to the applicant and retained the remaining $20,000 for himself. 31. At some time in 1982 or 1983 SACL secured the contract to supply Cathay Pacific with commissary items. These were obtained through Wong, and secret commissions were paid into "the Wong pot" to be shared by the applicant and Ho. However, Wilson Ning, who was named as a co-conspirator in count 1 and was the catering manager concerned with the purchase of commissary items, was paid a small sum from the pot in order to ensure that the operation functioned smoothly. By this time the secret commissions which contributed to 'the Wong pot' had grown to $70,000 per month and, after the agreed fixed amounts had been paid to Kaiser and Spieker, were shared equally between the applicant and Ho. 32. In 1984 Ho arranged with Helen Yeung for Richgo to supply SACL with orange juice, and a secret commission of 20 cents per cup was paid to the applicant and Ho. The commission which was between $5000 and $6000 per month was paid in cash by Helen Yeung to Ho at monthly meetings at the New World Centre. 33. For security reasons, it was Ho's practice as paymaster to pay the applicant his share of pot monies in cash. However, on two occasions he paid him by cheque. The first cheque was in the amount of $55,000, and the second in the amount of $13,236.60. The reason that Ho paid the applicant by cheque on the first occasion was that as one or the other J Ho could not remember which one of them it was - was going on leave and because Ho had not yet received the pot money, he did not have the ready cash to pay the applicant. As to the second cheque, Ho explained that this represented the applicant's share in the balance of pot money and was not rounded off to the nearest dollar because the applicant was meticulous about figures and insisted that payments be exact. In order to avoid suspicion, the first cheque was made payable to the applicant's wife, Helen Kim. The second cheque was signed in blank in the expectation that the applicant would arrange for some one to collect the money for him direct from the bank. Both cheques were eventually paid into the bank account of the applicant's wife. 34. The applicant sought to explain the first cheque by testifying that Ho had given it to the applicant's wife so that she and the applicant could buy some statues for Ho while they were on leave. However, as they did not succeed in buying the statues they returned the $55,000 to Ho in cash when they returned from leave. He explained that the other cheque had been given to him by Ho to reimburse him for a number of items that the applicant had bought for Ho in Hong Kong and overseas at Ho's request. 35. In February 1986 officers of the ICAC went to the office of SACL and made enquiries concerning the alleged acceptance of "laisee" by store staff. Ho became alarmed and spoke to the applicant who told him to remain calm. However, at Ho's request, the applicant composed a letter dated 6th February 1986 which was sent to ICAC in the hope that it would put an end to the investigation. In that letter, which the applicant signed, he stated that it was SACL's policy to permit store staff, including Wong, Ki, and Lau Chuen (all named as co-conspirators in Count 1), to accept presents and "laisee" during the traditional festival seasons provided that the amount was kept within sensible limits which were to be left to the discretion of the individual supplier concerned. 36. Notwithstanding the ICAC investigation into the matter of the receipt of "laisee" by store staff, the payment of hidden commissions into "the Wong pot" continued. There was, however, a change in the venue for the collection of the March and April commissions in order to avoid possible ICAC surveillance In March 1986 between $30,000 and $40,000, and in April $20,000, was paid into "the Chan pot". Although Chan had agreed that payments of secret commission would still continue, he in fact made no further payments to Ho. 37. Eventually more staff were taken for questioning by ICAC and, before long, Wong was arrested. Ho became increasingly worried and requested the applicant to write to Mr. Olsen, the Chairman of the Executive Committee of SACL. As a result, the applicant wrote to Olsen a letter which was headed "Strictly Private and Confidential" and in which he expressed the view that the investigation into the Food Stores staff had come about as the result of an accusation by a disgruntled colleague or former member of the staff. He suggested that the matter be handled internally and requested Mr. Olsen's consent to the giving of official advice to ICAC to close the case and discontinue further investigations. Mr. Olsen, however, declined to do this. 38. On 15th May, which was the day following Wong's arrest, the applicant told Ho that someone in SACL "had to leave". Ho understood this to mean that the applicant was telling him to leave Hong Kong. He therefore departed for Taipei on the earliest available flight that day. The applicant invented an excuse for Ho's departure. This was that Ho was to go to Taipei to see a Mr. Kim of United Airlines on official business concerning the extension of a contract between SACL and United Airlines. Mr. Kim, however, testified that he did not see Ho when Ho visited Taipei on this occasion and that there had been no reason for Ho to see him because the contract between SACL and United Airlines had already been finalised and no further negotiations could have been conducted that would have affected it. 39. Since Ho did not want to resign and lose his pension entitlements, he sent a telegram to the applicant from Taipei and applied for sick leave. The applicant gave his approval. Ho then went to Vancouver from where he telephoned the applicant at his office at SACL. The applicant told him not to call him at his office, saying that he, the applicant, would call Ho. Ho then arranged to meet the applicant in Taipei. At this meeting, which occurred on 20th June 1986, Ho explained to the applicant that his Canadian lawyers had advised him that his position in Canada was not safe. He therefore requested the applicant to write a letter stating that he, Ho, was permitted to receive commissions. The applicant replied that he could not do this and that he would have to refer the matter to Mr. Olsen. He requested Ho to resign from SACL but, when Ho protested that he wanted to obtain his pension entitlements and was not willing to retire, he agreed to grant Ho an extension of his sick leave and asked him to provide a medical certificate for that purpose. 40. The applicant told Ho that the arrangements for payment of secret commissions by Chan and Helen Yeung would continue and that he would receive the payments in Ho's absence. Ho gave the applicant his Vancouver telephone number and requested him to give it to Chan, Kaiser and Helen Yeung. A piece of paper on which this telephone number was written was found by Mr. Morris in the applicant's wallet. When Mr. Morris asked him about the number, the applicant replied that it was a number in Korea. 41. After his return to Vancouver, Ho, acting on advice, used his telephone answering machine to tape his telephone conversations with the applicant and with Kaiser. Having read the transcript of conversations that Ho recorded between himself and the applicant, we are left in no doubt that, despite the cryptic language used by Ho and the applicant in the conversations, no jury could have failed to come to the conclusion that both of them were there admitting that they were parties to conspiracies with Kaiser, Wong, Chan and Helen Yeung involving the payment of secret commissions to the applicant, Ho and Kaiser; that they were discussing the fact that Kaiser had suspended part of the operation - almost certainly that involving Wong - because it had become dangerous in the light of the ICAC investigation, and that the part of the operation involving Chan would continue as usual, except that Chan should make payments of commission to Ho in Canada who in turn would pay the applicant his share at some place other than Hong Kong; that they were speculating as to the identity of the person who had given information to ICAC, and concluded that it was Wong; that, notwithstanding that Chan had been interviewed by ICAC and had admitted that he had been paying a 2% commission, they were expressing the hope that he could be relied upon not to implicate them; that they were debating whether it was preferable for Ho to remain in Canada on six month's sick leave and play for time in order to find out whether the ICAC investigation had led to the discovering of Ho's involvement or whether he should tender his resignation to SACL before enquiries were made into his activities, so that no obstacle would lie in the path of the board of directors in approving his resignation; that they were discussing whether in the event of ICAC officers approaching the applicant about Ho, the applicant should ask them why they wished to see Ho, and, if the officers then made it plain that their enquiries concerned the taking of commissions, that the applicant would then inform them that he had given Ho permission to take a 2% commission provided that he was able to arrange a cheaper price for the products concerned than that offered by other competing companies; that they were discussing the feasibility of the applicant composing a letter to evidence that he knew and approved of Ho's receipt of commissions, and that the purpose of the letter would be to bring the ICAC investigation to a halt; that the applicant agreed that he would compose the letter if the ICAC questioned him about Ho's activities; that they were agreeing that the applicant would contact Helen Yeung and arrange with her to travel to Taipei so that Ho could fly there to meet her; that although they were expressing a desire to continue both aspects of the operation involving Helen Yeung, they were discussing whether they should terminate that part of the operation concerning the supply of orange juice; that they were discussing the problem of Spieker enquiring about his share and other matters; that they were planning, gradually, in order not to arouse suspicion, to discontinue their operation with Tai Wah Hong - a company owned by Fu Chi-kin, who is named as a co-conspirator in count 1 - because an investigation had begun into its activities; and that they were agreeing that the applicant would contact Ki and then let Ho knew the outcome of his discussion with him. 42. Helen Yeung's testimony confirmed that given by Ho in respect of Counts 2, 3 and 4. She testified that there had been a meeting between herself, Ho, the applicant, Lam and Lam's son, Alvin Lam Chun-kong, at which it was agreed that Ho and the applicant would together contribute 10% of the capital of $600,000 for Edstrom; that at that meeting Ho and the applicant stated that they wanted a guaranteed return from their investment and to be paid 10 cents commission for each kilogram of dry ice supplied to SACL by Edstrom; that initially the applicant and Ho had the power to sign cheques for Edstrom, but that later, because of fear of exposure, this power was withdrawn; that Chan became a director of Edstrom in 1981 in order to represent the interests of the applicant and Ho on the board of directors; that the applicant and Ho were present at a meeting of shareholders of Edstrom at which the supply of dry ice to SACL was discussed; that after an exchange of correspondence between Edstrom and SACL it was agreed that SACL would pay Estrom $4.85 per kilogram of dry ice; that this amount included the ten cents per kilogram which Edstrom was required to pay the applicant and Ho; that the contract was then signed; that the applicant did not personally ask her to pay him commission; that she paid the commission direct to Ho; that, when Edstrom later applied to SACL for an increase in price, Ho and the applicant imposed a condition that, in return for approval of the increase, they would be paid an extra ten cents commission per kilogram; that in September 1982, she told Ho that Edstrom was suffering from a shortage of capital and that as a consequence Ho agreed that it should be increased by the applicant and himself each contributing $90,000, and that she eventually received a cheque in that amount from a Mr. Lam Cham-wah; that in 1982 Mr. Lam Cham-wah took over from Chan as director in Edstrom for the purpose of representing Ho's and the applicant's interests in the company; that in 1983 Edstrom applied to SACL for another increase in the price of the dry ice and that this was approved after Edstrom had agreed to pay Ho and the applicant an additional 15 cents per kilogram of dry ice, thus increasing their commission to 35 cents; that in September 1981 she agreed with Ho that, in return for Societe des Cinqs Limited being given the contract to supply SACL with chocolate, she would and did pay Ho and the applicant 20 cents per packet; that in mid 1982 she set up Richgo which took over the chocolate contract from Societe that commission for the supply of chocolate continued to be paid to Ho and the applicant; that this continued until 1985 during which period approximately $1.3 m was paid direct to Ho; that Ho then arranged for Richgo to be given the contract for the supply of orange juice to SACL in return for Richgo agreeing to pay, and in fact paying, to Ho and the applicant 15 cents per cup of juice supplied; that the total amount of commission paid in respect of this contract over a period of 18 months until November 1986 was about $130,000; and that, although she never paid commission direct to the applicant, every contract that she, through her companies, had entered into with SACL was approved only after she had agreed with Ho to pay commission to him and the applicant. 43. It was an agreed fact that the applicant's emoluments in respect of his employment with SACL from 1st January 1978 and 31st December 1986 - a period longer than the period of conspiracy alleged in count 1, which was 1st January 1979 to 30th November 1986 - totalled $3,646,754. The applicant's salary over the alleged period of the conspiracy was $2,107,448-33. Mr. Love, the accountant who gave evidence for the Crown, discovered from the bank accounts of the applicant, his wife and Jasmin Limited, a company owned by the applicant's wife, that over the period he examined there were unidentified cash and cheque transactions totalling $9.3 m. In the applicant's accounts alone Mr. Love discovered large cash receipts totalling $316,992.74, small cheque receipts totalling $30,032.59 and large cheque receipts totalling $933,557.22, all of which were unidentified. 44. The applicant's defence was a complete denial of the allegations made against him. He denied having been aware that Ho was receiving secret commissions, and asserted that Ho was jealous of him and disliked him for a variety of reasons and had therefore fabricated a case against him. He also asserted that Helen Yeung had merely testified in accordance with what Ho had instructed her to say in order falsely to implicate him. 45. The first ground of appeal is as follows:
46. The passage from the summing up quoted in (a) of this ground was, however, followed by this direction:
47. In the light of this passage and the earlier direction on the burden and standard of proof, the correctness of which was frankly conceded by Mr. McCoy, who with Mrs. Panesar appeared for the applicant in this court Mrs. Panesar having represented the applicant at trial, we are of the opinion that the jury could not possibly have been under the impression that "both sides bear an equal burden" 48. There were, however, three other passages in the summing up upon which Mr. McCoy sought to rely in support of this ground. There are as follows:
then later, when referring to a conflict between the evidence of Ho and that of the applicant:
and later again,
49. We think it is quite wrong to look at these passages in isolation from the judge's overall directions. It is plain that not only did the judge give a correct direction on the burden of proof and followed this with a direction; that the jury should draw an inference adverse to the applicant only if that evidence admitted of no other logical and reasonable conclusion than that the applicant was guilty, but he also said at the very end of his summing up:
50. Having been told that even if they did not accept the applicant's evidence it did not mean that the Crown had proved all the charges beyond reasonable doubt, we do not think any sensible jury retiring with this direction ringing in their ears could possibly have thought that "both sides bore an equal burden". 51. We are satisfied that there is no merit in this subground. 52. As to subground (b) of ground 1 it is necessary first to refer to section 24 of the Ordinance which reads:
53. Had the applicant sought to establish that he had lawful authority or reasonable excuse for doing the acts alleged, the section would have been applicable, and it would have been incumbent on the judge to direct the jury as to the correct standard of proof that rested on the applicant to make good that defence. But this was not the applicant's defence. His defence was a complete denial that he received any advantages, namely, gifts, fees rewards or commissions from any of the persons alleged in the various counts in the indictment or that he conspired with anyone to do so. It was therefore not necessary for the judge to give the direction as to the standard of proof applicable to an accused person who seeks to avail himself of the defence of lawful authority or reasonable excuse. 54. We do not accept that the jury might have thought that the judges reference to section 24 had a bearing on section 21(1). That reference was plainly made by the judge solely in the context of his explanation to the jury of the significance of the words "without lawful authority or reasonable excuse" which appeared in each count, and to the fact that no evidence had been led to establish a defence of lawful authority or reasonable excuse. 55. Subground (c) of ground 1 relates to the judge's directions on the burden of proof; particularly in relation to section 21 which reads as follows:
56. Section 9 is an offence under Part II of the Ordinance, and section 12A(1) provides:
57. The judge, having read out the provisions of section 21 to the jury, said this:
58. Mr. McCoy submitted that these directions, particularly what the judge said in the first paragraph we have quoted, could have led the jury to think that it was incumbent on the applicant to give them a satisfactory account of his possession of pecuniary resources. He also complained that the judge failed to direct the jury that where the law casts a burden of proof on an accused person he is not required to discharge that burden on the standard of beyond reasonable doubt, but on the lesser standard of on a balance of probabilities. 59. We do not agree that the jury could have been misled. Indeed, the judge went on to direct them in these terms:
60. Having referred to the evidence relating to the applicant's wife's accounts, he said:
61. Then, after referring to the accounts of Jasmin Trading Co, a company owned by the applicant's wife, he told the jury this:
62. Moreover, at the end of his summing up, the judge gave the jury the direction that we quoted earlier when dealing with Mr. McCoy's submission concerning section 24, where he told them that, even if they did not accept the applicant's evidence, the Crown still had to prove all charges against the applicant beyond a reasonable doubt. 63. It is plain from his directions that the judge placed no burden on the applicant to prove anything. Indeed, his directions were unduly favourable to the applicant. He should have directed the jury that the burden of discharging the presumption referred to in section 21(2) rested on the applicant. Instead, he cast the burden on the Crown to prove beyond reasonable doubt that any monies held by the applicant's wife or her company, Jasmin, were held for the applicant. This ground of appeal therefore fails. 64. The second ground of appeal was as follows
65. The passage in the summing up of which Mr. McCoy complains is:
66. We pause here to observe that this letter, which Ho said was a forgery and which had not come into existence until 1986, was subsequently found in Ho's personal file at SACL despite the fact that Mr. Morris of ICAC who had conducted an earlier examination of Ho's file during the course of the investigation had found no such letter. 67. We think that it would be of assistance to place in its context the recorded telephone conversation to which we have just referred. In an earlier recorded telephone conversation between the applicant and Ho, Ho had pleaded with the applicant that, in the event ICAC officers should approach the applicant about Ho, he should tell them that he had given Ho authority to receive commissions. Ho urged the applicant to do this in order to protect Kaiser and Ho and the applicant himself. The applicant agreed to do so. In response to a further plea from Ho that they save themselves, the applicant agreed to discuss the matter with Kaiser. 68. In the succeeding telephone conversation between the applicant and Ho, the applicant told Ho that he had found a letter addressed to a Mr. John Dick from Kaiser. Mr. Dick, who at the time of this conversation was deceased, had been the Chairman of directors of SACL when Ho joined that company. The applicant then read out the contents of the letter to Ho. He said:
69. Ho responded that, although he was delighted, he was unaware of the existence of such a letter. The applicant then told Ho that Kaiser would call Ho on the following day or later. 70. On the same day Kaiser telephoned Ho and told him that although the finding of the letter on Ho's file was important, "it doesn't by itself mean nothing. It's just the credibility". When Ho responded that it would at least give him some protection against the law, Kaiser said that this was not the problem but that "the point is, it is too much talk, too much rumour." 71. The very next recorded telephone conversation between the alleged conspirators is the one of which Mr. McCoy complains. In it Kaiser said that he had backdated the letter to 1979. Ho expressed the hope that something more should be written and that it should be to the effect that under certain conditions he was entitled to receive commissions. 72. The gist of Mr. McCoy's submission is that for this conversation to be admissible it was necessary for the prosecution to prove the existence of the conspiracy by means of evidence coming from a source other than Ho himself. Mr. McCoy readily conceded, however, that, despite his researches into the matter, he had been unable to find any authority which gave explicit support to this proposition. 73. We consider that this area of the law is correctly stated in the following passage in Cross on Evidence 7th edition at p.589:
74. Cases cited by the author in the footnotes to this passage include Ahern v. R. (1988) 80 ALR 161; R. y. Mayet 1957(4) SA 492; Tripodi v. R. (1961) 104 CLR 1, and R. v. Donat (1985) 82 Cr.App.R. 173. 75. During the course of argument Mr. McCoy lost some enthusiasm for this submission and, although he stated that he was not abandoning it, changed tack by contending that since Kaiser was named as a co-conspirator in counts 1 and 3 alone, and since the conversation of which complaint is made occurred in July 1986 after the conspiracy in count 3 was alleged to have concluded, it could only be evidence against the applicant on count 1. 76. In our view, however, the admissibility of that telephone conversation between Kaiser and Ho did not depend on any assertion that Kaiser's utterances were made in furtherance of the conspiracies in which he was alleged in counts 1 and 3 to be a participant, but rested on the principle of agency, in its unextended form. Although it is this principle which forms the foundation on which acts and utterances made by one conspirator in furtherance of a conspiracy are admissible against a co-conspirator, it also operates independently of its application to the law of conspiracy. An examination of the transcript of the telephone conversations between the applicant and Ho and those between Kaiser and Ho leads to the inescapable conclusion that Kaiser was speaking to Ho not only on his own behalf but as the applicant's agent with the applicant's authority. This ground also fails. 77. Grounds 2 and 3 were advanced together. They allege that prosecuting counsel introduced damaging prejudicial material and conducted an unfair cross-examination of the applicant, and that the judge failed effectively to neutralize the prejudice and to remedy the effect of the cross-examination. 78. The applicant had testified that he had been unaware of the existence of any corrupt activities by personnel of SACL until he had been informed of the investigation by ICAC officers of the store staff, and agreed that it appeared that his trust in his staff had been badly misplaced. Prosecuting counsel then said "Because people are being convicted from top to bottom of your company, I put it to you, Mr. Beckers that that ....." At this point he was interrupted by an objection from defence counsel. 79. As the applicant himself had accepted, the ICAC had arrested members of the SACL store staff. Moreover, Kaiser, his superior, and Spieker, Wong, Ki, Lau, Ho and Ning, who were his subordinates, had all been arrested in connexion with the acceptance of advantages in the course of their employment with SACL. Kaiser, Spieker and Wong were jointly indicted with the applicant but failed to answer to their bail at the first trial. Kaiser and Spieker were, and still are, at large and Wong had subsequently been apprehended and convicted in a separate trial. Ki and Ning were also apprehended, but both pleaded guilty. Lau pleaded not guilty, but was convicted after trial. 80. The object of this challenged line of questioning was to highlight the unlikelihood of the applicant having been unaware of the existence of corrupt activities occurring above and below him in the company. From this the jury would no doubt have been invited to draw the inference that he too was involved in the corrupt activities. At the conclusion of argument on defence counsel's objection, prosecuting counsel conceded in the presence of the jury that his question had not been well framed and that the jury should ignore it. The judge then directed the jury accordingly. 81. It appears that the judge gave the ruling he did because he thought that what counsel had said "would seem to suggest to the jury that people had been convicted in this company and then there may be other implications." Employees of the company had been convicted. We think that cross-examination directed at demonstrating the unlikelihood of a man in the position held by the applicant not being aware of the existence of widespread corruption in the company would have been entirely proper. Where counsel erred was in asserting that someone at the "top" had been convicted. However, since Kaiser, who at an early stage was undoubtedly at the "top" of the company, had been jointly indicted with the applicant but had fled from Hong Kong and had failed to answer to his bail, we do not think that counsel's assertion would have given rise to any real prejudice. Although Spieker was not at the very "top" of the company, he was a senior officer and, as we have already observed, he too fled from Hong Kong and failed to answer to his bail. Corruption may exist whether or not those responsible for it are apprehended and successfully prosecuted. The "being convicted" merely served to highlight ex post facto the fact that it existed. 82. However that may be, prosecuting counsel conceded that the question should not have asked and the judge directed the jury to ignore it. That, in our view, effectively eliminated any possibility of prejudice. 83. It was also contended that unsubstantiated allegations of forgery of the letter signed by Kaiser and to which we have already referred were improperly put to the applicant in cross-examination. In the light of what we have said concerning this matter in relation to the second ground of appeal we are satisfied that there was evidence in the tapes from which it could be inferred that the applicant was either involved in the preparation of that letter or subsequently approved of it. 84. Complaint was also made that prosecuting counsel cross examined the applicant as to why, during the course of the taking of a cautioned statement from the applicant by an ICAC officer in the presence of the applicant's solicitor, the applicant had admittedly declined to answer questions whenever he was kicked under the table by his solicitor, but had readily answered innocuous questions. This line of cross-examination should not have been allowed. However, the judge specifically directed the jury in the course of his summing up that they were not to hold against the applicant the fact that he had answered "no comment" to certain questions, and explained that a person suspected of having committed a criminal offence is entitled to remain silent and not to answer questions. He added that this in no way indicated guilt on the part of the applicant. . 85. Our attention was also drawn to several instances of prosecuting counsel's abrasive manner in asking questions of the applicant in the course of cross-examination. While we entirely accept, as did Mr. McCoy, that prosecuting counsel should not be inhibited from conducting a searching, vigorous cross-examination, there can be no doubt that he should always observe due courtesy to a witness. Having said that, we are satisfied that nothing was said or done by prosecuting counsel that deprived the applicant of a fair trial. The criticism made by Mr. McCoy of counsel's conduct was, to use the words of Avory J in R. v. Banks [1916] 2 KB 621 at 623, "addressed to a matter of taste than to an actual irregularity in the proceedings." 86. We should add that we find nothing inherently objectionable in the practice of counsel referring a witness to testimony given by an earlier witness that is contrary to his own evidence. This is a legitimate means of exploring the veracity of the testimony of the witness who is being cross-examined. 87. Mr. McCoy also contended that the judge wrongly permitted prosecuting counsel to allow an ICAC officer to give opinion evidence on a subject on which he was not an expert. This arose when Mr. Morris, who had served previously as a police officer in the United Kingdom for 26 years, was asked by prosecuting counsel what conclusion he drew when, on searching the applicant's office in the course of his investigation into corruption within SACL, he found a tape recorder in the top right hand drawer of the applicant's desk which, when the play button was pressed, replayed a conversation between the applicant and Wong. The prosecution contended that the applicant had, unknown to Wong, recorded a deliberately contrived conversation between them in order to give the impression that he had not been involved in any corrupt activities. Mr. Morris replied that he took the view that "the tape had been left there to be found". 88. We do not consider that this was a matter on which expert evidence could properly be given. The conclusion to be drawn from the applicant's "look of horror", if the jury accepted that it was such, was one that could safely be left to them as a matter of human experience and common sense. We therefore do not think it at all likely that they would have given Mr. Morris' opinion any greater weight than it deserved. It also occurs to us that, apart from the fact that the recorder, with the tape conveniently loaded to play at the press of a button, had been placed where it could readily be found, it might well have struck any ordinary person as strange that the applicant, who knew of the on-going ICAC investigation and, according to him, had taped the conversation with Wong in order to obtain information about the suspected illegal activities in the store at SACL, had not turned the tape over to ICAC or to his board of directors whom he said had instructed him to make investigations into those suspected activities. 89. The next ground of appeal concerns the testimony of Mr. Love, the accountant, concerning his investigation of bank accounts belonging to the applicant, the applicant's wife, and her company, Jasmin. This investigation was conducted on the basis of information supplied by the applicant in response to a notice served on him under section 14 of the Ordinance, and of information gathered by the ICAC. Mr. Love had not been supplied with the complete documentation concerning the bank accounts of the applicant's wife. However, he was able to point to unidentified cash receipts, totalling $3,007,104 and unidentified non-cash receipts totalling $421,919-60 in those accounts. He also discovered unidentified cash payments totalling $3,003,802-95. 90. While Mr. McCoy initially submitted that the judge should have exercised his discretion to exclude this evidence, he later conceded that the mere fact that the evidence relating to the accounts was incomplete did not render it inadmissible. This is undoubtedly correct. However, Mr. McCoy then submitted that the evidence given by Mr. Love was so weak that the judge should have told the jury to give it no weight. He complained that the following direction did not go far enough and, in any event, was a contradiction in terms:
91. Had the judge used the words "an exact picture" instead of the words "a true picture", what he said would certainly have amounted to a contradiction in terms. It seems to us, however, that, despite the incompleteness of the accounts, the jury would have been entitled to conclude that the information that was available did present a true picture of how these accounts were being operated. In our opinion the judge correctly and fairly drew the jury's attention to the incompleteness of the accounts in deciding whether it had been proved beyond a reasonable doubt that the applicant's wife was holding money for the applicant or that he had made a gift of it to her. We see no justification for the submission that the judge should have directed the jury to attach no weight to Mr. Love's testimony. 92. Complaint is made of the fact that Mr. Love stated that the applicant's salary for the period over which he conducted his investigation was $2,107,448-33, whereas the Crown had agreed that the applicant's total emoluments were $3,646,754. But this overlooks the fact that the period over which the total emoluments were calculated was a year longer than that which related to the material before Mr. Love. There was no misrepresentation of the position. The judge accurately stated the evidence to the jury. 93. Mr. McCoy also pointed to the fact that Mr. Love had been unable to produce any evidence concerning the state of an account which the applicant operated in Singapore and whose existence he had made known to ICAC in response to the section 14 notice. But this was because Mr. Love had not been provided with the relevant documentation concerning this account. In this regard the judge told the jury that when they came to consider Mr. Love's testimony they must bear in mind the absence of information regarding the operation of the Singapore account. In our opinion the evidence was fairly put to the jury. This ground of appeal fails. 94. Mr. McCoy further contended that the judge was required to give a specific direction to the jury "as to the weakness or reliability" of Mr. Morris' testimony concerning the "look of horror" to which we have already referred. 95. We were given no authority for this proposition nor did Mr. McCoy give us any indication as to what he thought would have been a proper direction that the judge should have given to the jury. In our view the judge fairly presented the matter to them. Having reminded them of Mr. Morris' testimony, he then went on to remind them of the applicant's version of what had happened, namely that he had shown no emotional reaction at the time and that he had merely told Mr. Morris that it was an exercise book and that Mr. Morris had better ask his wife about it. Since the applicant did not assert that, when shown the entries, he had registered a look of puzzlement or any other response that Mr. Morris might possibly have wrongly interpreted as "a look of horror", we do not think that the judge was required to say anything further about the matter. 96. Under the same ground of appeal Mr. McCoy submitted that the judge had erred in directing the jury that the relevant entries in the exercise book were capable of amounting to corroboration of the testimony of Ho and Helen Yeung. He contended that these entries were incapable of amounting to corroboration, but that, if they were so capable, they were incapable of corroborating the testimony of both Ho and Helen Yeung on all four conspiracies. 97. We do not agree. The entries were certainly capable of corroborating Ho's testimony concerning the applicant's practice of receiving a breakdown of the various secret commissions, and that the breakdown in the exercise book followed the pattern of that provided by Ho to the applicant. Moreover, the entries related to the items which formed the subject of the various conspiracies. The general, duck and commissary entries were referable to the conspiracy alleged in count 1, the dry ice entries were referable to that alleged in count 2, and the chocolate entries were referable to that alleged in count 3. We accept that there was no reference to orange juice, which was the subject of the conspiracy in count 4 and was the last of the items for which secret commissions were received. But the judge did not tell the jury that the entries in the exercise book were capable of corroborating the evidence of either accomplice in respect of the orange juice conspiracy. He merely directed them that the relevant pages in the exercise book were capable of corroborating the evidence of Ho and Helen Yeung as to the system of pot money and the payment of commission on dry ice, chocolate and commissary items. There is no substance in this ground of appeal. 98. Finally, Mr. McCoy submitted that the judge erred in allowing the Crown to adduce evidence relating to the transactions involving Chan, Perfectional Food Provisions Company ("Perfectional") and Harvest Trading Company ("Harvest"). This submission was founded on the fact that the applicant had been acquitted at the first trial on counts 2, 6 and 8 in the indictment then before the jury. 99. Count 2 in that indictment named the applicant and Kaiser as defendants and alleged that between 1st January 1979 and 31st October 1986 they had conspired together and with Ho and Chan to accept advantages from Chan in respect of the purchases of supplies by SACL from Flamingle Trading Company ("Flamingle") and Wing Kee Seasonal Vegetables ("Wing Kee"). 100. Count 6 named the applicant and Spieker as defendants and alleged that between 1st January 1983 and 30th November 1986 they conspired together and with Ho and Chan to accept advantages from Chan in respect of the purchases of supplies by SACL from Chan of Perfectional. 101. Count 8 named the applicants and Spieker as defendants and alleged that between 1st January 1983 and 30th November 1986 they conspired together and with Ho and Chan to accept advantages from Chan in respect of the purchases of prawns by SACL from Chan of Harvest. 102. It was Mr. McCoy's contention that the reception at the second trial of the evidence relating to the transactions involving Chan, Perfectional and Harvest was therefore prejudicial and unfair to the applicant as it revealed a propensity or disposition to commit criminal offences and was designed to establish that the applicant was likely from his criminal conduct or character to have committed the offences for which he was being tried. An extension of this argument was that by introducing this evidence the Crown was seeking to go behind the verdicts of acquittal on counts 2, 6 and 8 at the earlier trial. In this regard he referred us to the opinion of Lord Hailsham in Reg. v. Humphrys [1977] A.C. 1 at 41B. Lord Hailsham, having observed that, although the civil doctrine of issue estoppel is not applicable to criminal proceedings, there is a doctrine which is based on the prohibition of double jeopardy, said:
103. It seems to us that, although counts 2, 6 and 8 in the first indictment were not expressed to be alternatives to count 1, the view that the jury at the first trial must have taken was that there were not separate conspiracies relating to Flamingle and Perfectional but one overall conspiracy, namely that alleged in count 1 which specifically referred to Flamingle and Perfectional along with the other Chan companies named therein, including Wing Kee. They therefore acquitted the applicant on counts 2 and 6 and convicted him on count 1. That count 1 alleged a conspiracy entirely separate and distinct from those alleged in the other counts is evident not only from the particulars of the persons from whom the conspirators conspired to accept advantages but also from the fact that the time span of the count 1 conspiracy is different from that alleged in those other counts. 104. As to count 8, the evidence failed to disclose that the applicant had received any secret commissions from Harvest. We mentioned earlier there was nothing to indicate that the applicant had received anything other than profits earned by Harvest in the ordinary course of business. For the applicant and Ho to have become joint owners with Chan of that company may well have been a breach of SACL's internal regulations or the terms of their employment with SACL, but that is very different from receiving secret commissions. We have come to the conclusion that this was the reason for the amendment of the indictment at the first trial by the deletion from count 1 of the reference to Harvest while leaving intact the references to Chan's other companies. We are unable to find any other rational explanation for the amendment, and none has been suggested to us. Having made that amendment, prosecuting counsel inexplicably omitted to discard count 8. Be that as it may, the jury were entitled to conclude that, unlike the situation with the other Chan companies, the applicant was not receiving any secret commissions from Harvest and therefore acquitted him on that count. 105. Since Ho was the only witness to testify as to the existence of the conspiracy alleged in count 1 in the first indictment, the jury plainly believed his testimony that the applicant was a participant in that conspiracy. It was a conspiracy in which it was alleged by Ho that Chan had played a central role. 106. Although we accept that a jury may accept the evidence of a witness on one count but not accept it on another, we are unable to find any cogent reason for them to have done so in this case. 107. At the second trial the prosecution was not seeking to prove that Chan had been guilty of the separate and narrower conspiracies of which he had been acquitted at the first trial, but to prove that he was involved in the wider conspiracy alleged in count 1 and of which the jury at the first trial had found him guilty. There was no attempt to go behind the verdicts of acquittal or to violate the principle of double jeopardy. The evidence given by Chan was therefore relevant. We do not accept that its prejudical effect outweighed its probative value. 108. We also consider that it is not without significance that counsel for the applicant, who must have been fully aware of his acquittal on counts 2, 6 and 8 at the first trial, did not take the point at the second trial that Chan's evidence was inadmissible on the prosecution was thereby seeking to go behind acquittals. Nor was it suggested by counsel at trial that the evidence should be excluded on the ground that its prejudicial effect exceeded its probative value. 109. In our opinion this ground has not been made out. The application for leave to appeal against conviction is therefore refused.
Representation: Mr. M.A. McMahon for Crown Prosecutor Mr. G.J.X. McCoy and Mrs Panesar assigned by DLA for Applicant |