HKSAR v. Wong Man Hon

HCCC000414/1999

HCCC 414/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

HIGH COURT CRIMINAL CASE NO. 414 OF 1999

____________

____________

Coram: Deputy High Court Judge Longley

Dates of Hearing: 19, 23 & 24 May 2000

Date of Judgment: 24 May 2000

_______________

J U D G M E N T

_______________

1. This is an application by the Secretary for Justice for a confiscation order under S. 3 of the Drug Trafficking (Recovery of Proceeds) Ordinance Cap. 405 ("the Ordinance").

2. On 18 February 2000, the Court of First Instance, following the Defendant's plea of guilty in the Magistrate's court, passed sentence of 111/2 years imprisonment on the Defendant for the offence of "trafficking in dangerous drugs" contrary to S. 4 of the Dangerous Drugs Ordinance, a "drug trafficking offence" specified in Schedule 1 of the Ordinance. At the same time the Defendant was sentenced to terms of imprisonment for two other offences, possession of a dangerous drug contrary to S. 8 of the Dangerous Drugs Ordinance and importing unmanifested cargo contrary to S. 18 of the Import and Export Ordinance Cap. 60.

3. The Defendant was a lorry driver whose vehicle was stopped by Customs Officers at the Lok Ma Chau crossing point as it was about to enter Hong Kong. The vehicle was found to be carrying 50 cartoons of unmanifested cigarettes. A small quantity of heroin hydrochloride for the Defendant's own consumption was found on the driver's seat. A much larger quantity of drugs, 699.68 grams of a mixture containing 507.61 grams of heroin hydrochloride, valued at $147,000, was found in two blocks concealed inside the Defendant's underpants. It is these drugs that were the subject of trafficking charge.

4. Some cash was found on the Defendant's person at the time of his arrest but it is accepted that most if not all of that sum of money was money belonging to his employer.

5. Customs Officers searched the Defendant's home and found a total of $137,000 inside the drawer of a wardrobe in the Defendant's bedroom. The money was contained in 3 separate envelopes. One contained $100,000 in $1,000 notes. Another contained $20,000 in $1,000 notes. And the third contained $17,000 in $1,000 and $500 notes.

6. It is contended by the Prosecution that the Defendant has benefited from drug trafficking and that the $137,000 found in his bedroom represents the realisable benefits of trafficking.

7. The Defendant has given conflicting explanations as to the source of this sum of $137,000.

8. On 18 June 1999, the day following his arrest he informed Acting Senior Customs Officer, Cheng Siu Ping that the money was his joint savings with his wife. He had kept the money at home because he did not trust banks. This statement conflicted with the statement taken from the Defendant's wife earlier the same day in which she said that the money was not hers and that she did not know to whom it belonged.

9. On 29 December 1999, the Defendant gave the same Customs Officer Cheng Siu Ping a different account. He said that $80,000 of that sum represented two sums of $40,000 given to him by his sisters Wong Fung King and Wong Fung Ling to redecorate the family home in Punyu in China. The balance of $57,000 represented his own savings as a lorry driver, $40,000 of which he intended to be used for redecorating the family house. His sisters subsequently gave statements supporting this second version.

10. The Defendant explained his first statement by saying that he had not wanted to get his sisters into trouble and that he wanted to rest. He amplified this in his Reply to this application and in his evidence during this application by saying that he was suffering from drug withdrawal symptoms at the time he made the first statement.

11. The Prosecution has tendered the statement of Inspector Hon Lik dated 16 February 2000 under S. 5 of the Ordinance in support of its application. It did not seek to rely upon a supplementary statement of Inspector Hon dated 17 May 2000.

12. There are at least two issues before the court. Firstly, whether that the Prosecution have shown the Defendant benefited from drug trafficking and if so secondly, assessing the value of the Defendant's proceeds of drug trafficking. Once a court has assessed the value of a defendant's proceeds of drug trafficking a third issue may arise namely how much of that value is realisable and should be confiscated.

Has the Defendant benefited from drug trafficking?

13. There was no direct evidence that the Defendant had received remuneration from trafficking in drugs. In his statement to the police at 1255 hours on 18 June 1999 he said that this was the first time he trafficked in dangerous drugs (and indeed in cigarettes). The person for whom he was carrying the drugs had not yet paid him any money and would have paid him $17,000 only after he had delivered the drugs in Hong Kong.

14. The court is, however, permitted to rely on the assumptions contained in S. 4(3) of the Ordinance in determining whether the Defendant has benefited from drug trafficking.

15. By virtue of that subsection the court may in respect of any property appearing to the court to have been held by the Defendant at any time since his conviction or to have been transferred to him at anytime since the beginning of the period of 6 years ending when these proceedings were instituted against him make the assumption that such property was received by him as his proceeds of drug trafficking unless the Defendant shows that the assumption is incorrect.

16. In so far as the $137,000 is concerned even on the Defendant's own account that sum of money had either been held by him since his conviction (in the sense that he had an interest in it: see S. 2(7) of the Ordinance) or had been transferred to him within the previous 6 years. On his account $80,000 had been transferred to him by his two sisters Wong Fung Ling and Wong Fung King in January 1999 and the sum of $57,000 was his own property being his savings.

17. For reasons I will refer to later I did not accept the Defendant's evidence as to the source of these funds but I was in no doubt, having been found in the drawer in which according to his wife the Defendant kept his underwear and underpants, that the money was property in which the Defendant holds an interest. I was also satisfied bearing in mind firstly the evidence of his employer, Chan Keng Por, that on occasions after he joined Mr Chan's firm in October 1997 he had told Mr Chan that he did not have enough money for his family and had asked for loans and that he had received one loan as late as February 1999, and secondly that that money was contained in envelopes bearing dates in 1999 that the Defendant acquired this money after February 1999.

18. Has the Defendant shown on the balance of probabilities that the assumption referred to in S. 4(3) is incorrect in his case?

19. I found the account given by the Defendant and his two sisters to the source of this sum of $137,000 totally implausible.

20. I did not believe the Defendant's account that $57,000 of that sum was his own personal savings which unknown to his wife he had been saying from his earnings in cash since 1991. On his account by October 1997 he had already saved that sum.

21. If that had been the case it is highly unlikely that he would have asked his employer for the loans to support his family as I am satisfied he did at least in February and April 1998 and February 1999.

22. If he had those savings it would not have been necessary to let his wife borrow as much as $80,000 from friends to redecorate and furnish their flat in Tsz Lok Estate in February 1998.

23. His account of why he kept the money at home in cash rather in the bank where it could have earned interest was inconsistent. Having told the police on 18 June 1999 that he did not put the money in the bank because he did not trust banks, he gave a different version in court and said that it because it was inconvenient to keep it at a bank.

24. It is also highly unlikely, in my view bearing in mind, his evidence that he was a drug addict and a gambler that he would have had the self restraint not to spend the money.

25. Equally I found the account of the Defendant and his two sisters that his sisters had each given him $40,000 at the end of 1998 or early 1999 to redecorate the family home in China implausible. On the account of the two sisters they also had been saving up these sums in cash at home unknown to their spouses.

26. Neither of the sisters was in employment, so the sums would have represented savings out of their housekeeping money over a long period, yet despite this they were prepared to hand these substantial sums of money to a brother, who said he made no secret of the fact that he abused drugs, for an indefinite period until he told them that he had saved his share of the money necessary to have the redecoration work carried out. Despite the fact that they were handing over these large sums of money to the Defendant for this redecoration work they did not ascertain from him how much money he had already saved, so as to have some idea when the work might begin.

27. The evidence of the two sisters was inconsistent with that of the Defendant as to the quotations obtained to effect the work on the house. On their accounts the quotation was for around $100,000 and there had only been one quotation. On the Defendant's account he had originally been told by one or both of his sisters that it would cost $120,000 and had later been given by them a second figure of $130,000-$140,000. It is hard to understand if the Defendant's account was true why he did not tell his sisters at the time they gave him the money that they already collectively had enough money to effect the redecoration work as jointly they would have had $137,000. It is also hard to understand why if he had been told that the revised estimate was $130,000-$140,000 he should state in his Reply of this application that the estimate was $120,000.

28. I do not believe that the Defendant would have left $137,000 in his underwear drawer at home for almost six months rather than put it in the bank where it could have earned interest simply because it was inconvenient to go to the bank.

29. I did not accept the Defendant's explanation as to why he should have told the Customs Officer on 18 June 1999 that the sum of $137,000 was the joint savings of him and his wife namely because he was suffering from withdrawal symptoms, wanted to rest and did not want to get his sisters into trouble. I believed the evidence of Customs Officer Cheng Siu Ping that the Defendant was showing no signs of discomfort and that he made no complaint either of tiredness or feeling unwell. Moreover he was under treatment of the time at Queen Elizabeth Hospital where he had been admitted the previous day and could always have requested medication . From the statement he was capable of giving a detailed version of events. I failed to understand the logic of why he preferred not to tell the truth so as to avoid causing his sisters some unspecified trouble but preferred to tell a lie which would presumably cause the same trouble to his wife.

30. In view of these matters I found that the Defendant has failed to show that the $137,000 was not received by him as the proceeds of drug trafficking. In the circumstances I make the assumption of this money was received by him as the proceeds of drug trafficking and accordingly that he has benefited from drug trafficking.

31. The second question for the court is to assess the value of the Defendant's proceeds of drug trafficking.

32. In the light of my findings regarding the $137,000 S.4(2) of the Ordinance permits the court to make assumptions that that sum was the proceeds of drug trafficking for the purpose of assessing the value of the Defendant's proceeds of drug trafficking.

33. In order to assist me in relation to the Defendant's proceeds of drug trafficking I have had the benefit of the revised analysis of Mr Alex Leung Hing-kuen, the Treasury Accountant, of the concealed income of the Defendant for the year preceding his arrest based upon the Defendant's allegation in his reply to the S. 5 notice that he only contributing $11,000 to his wife during the relevant period rather than the $15,000 he had referred to in his statement of 18 June 1999.

34. Because of the evidence of the loans from his employer I consider that the assumptions made by Mr Leung as to the assets of the Defendant in June 1998 are likely to be realistic as are the figures he uses for the Defendant's assets in June 1999. The Defendant's salary during that year has not been disputed. The Prosecution has not sought to dispute the Defendant's own statements as to his expenditure.

35. Mr Leung's calculation show a concealed income of $143,741.52 during that year. He has not taken into account an allegation first made by the Defendant in his Reply to this application dated 9 March 2000 that in addition to his salary and unknown to his employer he received $300 per trip by carrying goods samples for other companies.

36. In his Reply he stated that he could not tell how much he earned for doing this. In evidence, however, he said he would do it about 3 or 4 times per month with a maximum earnings of $1,200 per month.

37. I viewed this evidence on this matter with considerable scepticism. It is in conflict with his statement of 18 June 1999 when he said that he had no income other than the monthly income of his driving job. I am satisfied that if it had been a significant source of income he would have mentioned it. I am prepared to assume for the purpose of this application that he received $300 per month for these unofficial favours performed for other companies.

38. Deducting such a sum ($300) over 12 month ($3,600) from the concealed income of $143,741.52 calculated by Mr Leung produces a figure of $140,141.52. I am satisfied that the figure represents a reliable approximation of the Defendant's concealed income.

39. This figure is very close to the figure of $137,000 found in the 3 envelopes in the Defendant's home. Bear in mind that the figures used by Mr Yeung for expenditure which were supplied by the Defendant can at best only be rough figures and the circumstances in which that the sum of $137,000 of cash was kept I am satisfied that the sum of $137,000 represents the value of the Defendant's proceeds of drug trafficking.

40. I am satisfied that that sum is capable being realised. I order that the Defendant do pay the sum of $137,000 to the Registrar of the High Court by 19 June 2000 and in default do serve a term of 12 months imprisonment.

41. I order that the cash totalling $137,000 ordered to be kept in the custody of the Customs and Excise Department be made available if required for the satisfaction of this payment order.

42. I wish to say, for the avoidance of doubt, having heard submissions by both counsel in case, that I have ignored the contents of the judgment of the Court of Appeal in dismissing the Defendant's appeal against the sentence on 28 April 2000 which only came to my notice and to the notice of counsel in this application after the evidence in the application had concluded.

Representation:

Mr Tam Sze-lok, SGC of DOJ, for the Applicant

Mr Kelvin Chan, instructed by DLA, for the Respondent