The Queen v. Li Ping-lun and Another

DCCC000040/1977

IN THE DISTRICT COURT OF HONG KONG

HOLDEN AT VICTORIA

CRIMINAL JURISDICTION

CASE NO. 40 OF 1977

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Coram: Judge Rhind in Court.

Date of Judgment: 16th August 1977

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JUDGMENT

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The first defendant (hereafter referred to as "D1") faced two oharges of being a Crown Servant in control of pecuniary resources or property disproportionate to his then present or past official emoluments, contrary to section 10(1)(b) of the Prevention of Bribery Ordinance, Cap.201, the date of such control being partioularised as the 13th September 1973 in the first charge and the 16th April 1974 in the second charge. The second defendant (hereafter referred to as "D2") stood trial on just the one count which was of aiding and abetting D1 to commit the first charge.

That D1 was a Crown Servant, namely Sergeant Number 4278 of the Royal Hong Kong Police Force, on the dates specified in the charges was common ground.

I found it proved beyond reasonable doubt that D1's total official emoluments from the time he first joined the police on 17th December 1951 till 13th September 1973, which is the date specified in the first charge, did not exceed $141,786.

That total comprises his basic salary of $133,111 plus all the allowances to which he might have been entitled according to the evidence of P.W.6, a Treasury Clerical Officer, and P.W.19 a Senior Executive Officer at Police Headquarters. Whenever the Government records have been incomplete I have assumed that he received any allowance to which he might have been entitled at the maximum rate, and where I have had to estimate, as for example with Additional Duty Allowance, the figure I have arrived at has always been well in excess of the average indicated by the data actually available. Any error will thus be on the side of fairness to the defendants in whose interests it obviously is to have D1's official emoluments shown at as large a figure as possible.

Besides the figure of $133,111 for salary just referred to, the allowances up to 13th September 1973 were as follows:

(1)Additional Duty Allowance: $280

This type of allowance only commenced in February 1973, and records were not kept till April 1973. The records proved that for the whole of the year from 1st April 1973 to 31st March 1974 D1 received a total of $80 under this head. Thus on average he would have got less than $7 per month. So as not to be niggling and for the sake of simplicity, I have assumed that for the two month period without records he received this allowance at the rate of $100 per month, and also I have assumed that the whole of the $80 he earned for the year commencing 1st April 1973 was in respect of the period prior to 13th September 1973.

(2)Plain Clothes Allowance: $5,640

December 1951 - December 1968

1969 - 1971

1st January 1972 - 1st April 1973

1st April 1973 - 13th September 1973

(3)Riot Hard Lying Allowance: $2,700

This is an estimate based on the assumption that D1 received the daily allowance of $15 for each and every day, throughout the whole period from May to October 1967 during which this was payable.

(4)Award Payments: $55

This was the actual amount D1 received.

The total of those four allowances comes to $8,675, which, together with his salary of $133,111 gives a result of $141,786 for his official emoluments up to 13th September 1973.

A calculation along the same lines gives a result of $152,253 for D1's total official emoluments up to 16th April 1974, which is the date specified in the second charge. That figure is made up of basic salary of $143,438 plus allowances of $8,815. Between 13th September 1973 and 16th April 1974 D1 had earned a further $100 in respect of estimated Additional Duty Allowance, and $40 as the maximum extra Plain Clothes Allowance he could have gained.

My findings of fact relating to D1's official emoluments stem from my acceptance of the truthfulness of the uncontradicted testimony of P.W.6 and P.W.19 who gave evidence in this regard.

In cross-examining P.W.6 and P.W.19 the Defendants put questions referring to a whole range of allowances such as those described as being for Unaccommodated Families, Marksmen, Frontier Duty, Technicians, Language Proficiency (Red Tab), C.I.D., and Reserve but they did not follow this up with any evidence to the effect that D1 actually received any of those allowances. From the evidence as a whole I was satisfied D1 was not entitled to any of them. Even if he might have been, common sense would dictate that they could only have made a marginal difference to his total official emoluments.

Turning now to the question of D1's pecuniary resources or property, the Prosecution sought to show that he was in control of the funds in two bank accounts.

The first of these was current account No. 006641-001, held by Liu Hung (P.W.11) at the Kwun Tong Branch of the Hang Seng Bank Ltd. Of my assessment of P.W.11's evidence, there will be occasion to speak in due course, but, for the moment, suffice it to say I accepted as true his evidence that from about 1971 till near the end of 1974, he was in partnership with D1 and others in an off-course gambling business known as Sun Po Lun. (For the sake of completeness perhaps I should mention that for about twelve months of the period prior to 1973, P.W.11 withdrew from the partnership but that has no bearing on the issues before the Court.)

Further I accepted P.W.11's evidence that during the period which encompasses the 13th September 1973 and 16th April 1974 he allowed the Sun Po Lun partnership to use his current account as its current account. Unfortunately for the Crown, there was no one to gainsay P.W.11 when he went on to describe how that same account was also used by him for business purposes by the Wing Tung Fuk Herbs Company of which he is proprietor, and also as repository for any winnings he might make from his own private gambling transactions or for any wind-falls which might come his way, as when, for example, he collected the proceeds of sale of a flat. None of those sources of revenue was kept separate in the account, so he was quite unable to say what share, if any, belonged to Sun Po Lun, and hence to D1 on particular dates.

Thus, although the evidence established that $349,388 stood to the credit of P.W.11's account on 13th September 1973, and $297,824 on 16th April 1974, no part of this has been shown to be attributable to D1 on either date. In this type of case, it is essential for the Crown to quantify the pecuniary resources controlled by the Crown servant at the dates specified in the charges, and this the Crown had failed to do in so far as P.W.11's bank account is concerned.

The second of the bank accounts where the Prosecution alleges D1 controlled the funds is current account number 034815-001 opened by D2 at the Kowloon City branch of the Hang Seng Bank on the 17th April 1973. D2 signed all the cheques drawn on that account. Like D1, D2 is also a policeman. It is common ground that he and D1 are old friends and colleagues who, starting as long ago as 1952, have from time to time served together in the same police stations. Whilst D1 reached his present rank of sergeant in 1971, D2 has never risen above the rank of constable. Another point to be noted is that D2's service has not been continuous: he retired from the Force in October 1972 and rejoined in December 1974. Thus, this current account was opened at a time when he was a civilian, and moreover it was closed in June 1974, which was before he re-joined the Police.

As at the 13th September 1973, $246,970 stood to the credit of that account, while on 16th April 1974 the credit balance was $222,000. Was the Prosecution able to establish that those amounts were in D1's control on those dates, which are, of course, the dates featured in the 1st and 2nd charges respectively? My conclusion was that the Prosecution did succeed in proving that D1 controlled both those amounts. This the Prosecution was able to do even without recourse to the presumption of control arising from close relationship contained in section 10(2) of the Prevention of Bribery Ordinance.

Without that presumption, whether "control" is proved becomes a pure question of fact. If "control" can be proved even independently of the presumption, then a fortiori it can be proved with the benefit of the presumption. The presumption became law on 14th February 1974, so if applicable, could have benefited the Crown in respect of the second charge which relates to events after that date. However, it is questionable whether it could ever have applied to the first charge which relates to 13th September 1973. Mr. B. Downey in an article entitled "Combatting Corruption: The Hong Kong Solution" ⁽¹⁾ expresses the opinion that this presumption will not apply to offences committed before 14th February 1974, but this must be open to question as the operation of the Ordinance has been shown to be retrospective in other respects - even on matters of substantive law: R. v. LAI Man-yau ⁽²⁾. I for one am not persuaded that an evidentiary provision such as section 10(2) is not retrospective in its effect, and would have been prepared to apply it to the 1st charge, had the point not become academic on account of the Crown proving control without the aid of the presumption.

More than anything else, the fact that the Crown was able to prove that D1 not only paid several people with cheques drawn on this account of D2's, but also that he (D1) deposited cheques in the account too, tended to show that D1 was in control of the funds in this account. Needless to say, these payments from and into the account cannot be considered just in isolation but against the background of all the evidence in the case.

The cheques which the Crown proved D1 thus used to make payments for his own purposes were exhibits P1(28); (29); (32); and (33).

Of those four cheques, D1 only admits to knowing anything about Exh. P1(28). Exh. P1(28) is a cheque for $5,000 dated 30th April 1973, and cashed by one YU Tai-wai (P.W.8) on that date. The evidence left no doubt that at that date, P.W.8 was a constable serving in the same police station as D1, and P.W.8 had taken the cheque to the bank on D1's behalf for cashing. Ultimately D1 did not dispute P.W.8's evidence on how he came to cash the cheque for D1, although initially D1 sought to show that P.W.8 got the cheque from P.W.8's girl friend rather than from D1.

D1's explanation, on which D2 supported him, regarding how he got the cheque was that D2 had given it to him in respect of winnings on bets placed by D2 for D1. Beyond that, according to D1, he knew nothing about the cheque and the account on which it was drawn. D2 for his part conceded that he was indeed running this bank account on behalf of another - one Fung Ming who was in no way connected with D1.

D2 went on to explain a complicated arrangement whereby in exchange for cash paid to Fung Ming, D2 could use the cheques drawn on this account for his own purposes, and this was how D2 came to hand over the cheque Exh. P1(28) to D1.

I will deal more fully with this explanation of D2's regarding his supposed relationship with Fung Ming in due course, as I will also deal with my assessment of the credibility of both Defendants. At this stage it will be sufficient if I state my conclusion which is that I rejected the explanation of the Defendants of how this particular cheque Exh. P1(28) came into D1's hands. The inescapable inference is that the true explanation of this cheque is that it was one kept by D1 as part of a routine supply signed by D2 in blank.

Before leaving the topic of Exh. P1(28) and P.W.8, it will be convenient to mention that D1's conduct of his trial in relation to P.W.8 affords an excellent illustration of why the Court was forced to conclude that D1 was not worthy of belief. For a start D1 put it to P.W.8 that the cheque Exh. P1(28) came from P.W.8's girl friend. (See page 80 of the record) This presupposed that D1 knew P.W.8 fairly well. Next (at page 471) D1 states he asked P.W.8 to cash the cheque. Then (at page 481) D1 says he gave it to a colleague, whom he does not recall now, to cash, and repeats that again (at page 492). Afterwards (at page 494) he seems to be saying he is not really sure if he knows P.W.8 and (at 495 to 501) he reveals himself as highly evasive in trying to reconcile the contradictions pointed out to him regarding his various versions.

I believed HUNG Mo-lim (P.W.2) that D1 gave her the cheque Exh. P1(29), dated 16th June 1973 for $5,000 in repayment of money he had promised to invest for her on the stock market. The evidence was consistent with the proceeds of Exh. P1(29) finishing up in the account of her husband with the Hong Kong and Shanghai Bank (Account No. 002-9-118270), and I am sure that is what did happen.

P.W.2 had been a telephonist at Wong Tai Sin Police Station at the same time as D1 worked there. According to D1, she was just making up this story about his having given her this cheque: he knew nothing about this cheque. He suggested the reason she might want to fabricate evidence against him in this way was that he had once made her cry when he scolded her for disconnecting his phone call when they worked together.

My impression of P.W.2 was that she told the truth in the witness box. D1's suggestion that she might be perjuring herself for the reason he suggests is ludicrous. The fact that the cheque Exh. P1(29) found its way into her husband's account supports her story. According to D1, she is one of several people perjuring themselves against him in this case: others are Lui Hung (P.W.11) and Kwok Cheung (P.W.12). None of them, as far as I could make out, had any discernible reason to want to get D1 into trouble. In fact all of them gave their evidence in a way which was anything but hostile to D1. The possibility that either individually or collectively that any of these witnesses might want to lie to get D1 into trouble is far-fetched. Perhaps the Defendants might suggest that I.C.A.C. officers put the witnesses up to telling lies. I find that suggestion inherently implausible, and certainly in no way consistent with the impression the witnesses made on me in the witness box.

According to D1, it was inherently improbable that, by June 1973, with the stock market in decline, he should be paying her $5,000 when her initial investment had been only $2,000 a couple of years before. I saw nothing strange in this. There are all sorts of reasonable possibilities, ranging from D1 being a particularly shrewd investor to D1 making a generous gesture and thus gaining face by giving P.W.2 a handsome return on the comparatively small amount she invested. This last type of possibility would be consistent with the way in which he treated another witness, CHAN Kee-kuen (P.W.3), of whom more will be said in a moment. After not seeing her for ten years, he gave her $10,000 because she said her mother was ill, and although it was described as "a loan", D1 never seems to have had much prospect of getting it back. D1 emerged as an open-handed individual, which, as I have said, could be one of several reasonable explanations of why he paid P.W.2 the amount he did.

Evidence about Exh. P1(32) came from Kwok Cheong (P.W.12), whom I found to be one of D1's partners in the Sun Po Lun off-course gambling business. Like Lui Hung (P.W.11), who was also a partner in that business, the Court had to be alert to the possibility P.W.12's evidence might be tainted because he could have had purposes of his own to serve. The Crown acknowledged this possibility by granting them both immunity in regard to disclosures they might make of their illegal gambling activities with Sun Po Lun. I treated each of them as if he had been an accomplice and warned myself of the dangers of accepting any uncorroborated testimony from either of them. I also reminded myself that one accomplice cannot corroborate another. One particular danger I was on the look out for was that either P.W.11 or P.W.12 might be tempted to give untruthful evidence against the Defendants in the hope of saving his own skin, either in particular with regard to the activities of Sun Po Lun or otherwise more generally for other illegal activities not alluded to in Court.

In the end I formed the opinion that each of P.W.11 and P.W.12 was a credible witness whose evidence it was safe for me to accept without corroboration.

At this point it will be convenient to include a comment on the form of immunity offered by the Crown to P.W.11 and P.W.12. With each of them the Crown waited till the witness was in the box before informing him orally that he would not be prosecuted if he gave full and true evidence. At least in P.W.11's case this was the first time he knew he was going to get an immunity.

I regard the Crown's practice as objectionable. The witness should be informed well beforehand in writing of the exact terms of the immunity he is being offered so that he has ample opportunity to consider his position, and if he feels so inclined, to seek legal advice.

I feel that under the procedure adopted before me that a witness might get the impression that he will only enjoy immunity if his evidence to the Court follows what he has already told I.C.A.C. No doubt, very frequently what he has told I.C.A.C. will have been the truth so that no problem of a conflict will arise when he comes to give evidence in Court, but it would not seem to be in the interests of justice that there could be cases where a witness might feel under any pressure to persist with a version which is untrue.

Written immunities along the lines of those granted to Cheng in R. v. Godber ⁽³⁾ and to Smalls in R. v. Turner ⁽⁴⁾ give witnesses an opportunity of knowing where they stand.

Of course, there could be more of a risk that a witness, secure in the knowledge of an immunity and with time to ponder his position, is likely to turn hostile to the Crown. However, that is a risk the Crown would have to accept. Balanced against that risk would be the gain to the Crown in being able to present all its witnesses to the Court with confidence, instead of giving the impression, as it sometimes does now, particularly in I.C.A.C. cases, that even the Crown does not trust some of its own witnesses sufficiently to let them know definitely that an immunity will be forthcoming.

As it was, despite the procedure adopted by the Crown to confer immunity in the present case, I still regarded P.W.11 and P.W.12 as reliable witnesses.

Judging from their demeanour in Court and from what they had to say, both of D1's former partners appeared to be well disposed towards him, and I am sure that neither of them lied to try to get him into trouble.

P.W.12 convinced me that D1 had paid him the cheque Exh. P1(32) for $100,000 representing P.W.12's share of capital on retiring from the partnership. According to the notations and endorsement on Exh. P1(32), coupled with the evidence of various bank officials, it was cashed over the counter, whereas P.W.12 (at page 210) referred to depositing it. Later (at page 226) he refers firstly to cashing it, then to depositing it. D1 suggests that is indicative of P.W.12 lieing. I cannot agree. P.W.12 is a business man who deals with hundreds of cheques, so he could hardly be expected to remember in detail how he dealt with any particular one. Also people often speak loosely about depositing a cheque when they mean cashing it and vice versa. D1 is clutching at straws here.

D1 claimed to know nothing about Exh. P1(32), but I disbelieved him.

Other evidence, to which I will refer in more detail later, proved that P.W.11 had paid D1 $150,000 by cheque Exh. P5(3) on the understanding that the sum of $150,000 was to be the amount to be paid to P.W.12 for his share of capital on retiring. D1 was to attend to the actual paying of P.W.12.

D1 asks how it could have been that he would have paid P.W.12 only $100,000 when P.W.11 had supplied him with $150,000 for this purpose. It is a strange feature. One possible explanation, although I do not think it a likely one, is that D1 cheated his partners. I do not know what the answer to this is, and I do not regard it as important. It has not left me with a doubt about either the evidence of P.W.11 or P.W.12. Rare is the criminal case where there are no loose ends on peripheral details. What the Court has to do is to consider the evidence as a whole, and this makes it clear that D1 was making payments with cheques out of that account which included Exh. P1(32).

Last among the four cheques is Exh. P1(33). P.W.3 described how she had known D1 while she was a dance hostess and then met up with him again some ten years later by chance in April 1974. Her evidence continued to the effect she went out for tea with D1 who was accompanied by several men she did not know, and she then asked him for a loan of $10,000 to help with the expenses of her sick mother. While they were all still having tea he gave her the cheque Exh. P1(33).

I am sure she told the truth, and from her story it is obvious that the only person present at that gathering who could have caused her to receive the cheque was D1.

Under the prompting of cross-examination from D1, she agreed that one of the other men present at the table had handed D1 the cheque which D1 then handed on to her. Apart from the addition of the detail that D1 got the cheque from one of the men present at the table, her story remained unchanged, so that her evidence was to the effect that D1 was her actual benefactor.

I got the impression that P.W.3 was doing all she could to be helpful to D1 in her evidence, and was prepared to go along with his suggestion that he got the cheque from one of the other men at the table, even though she was not really sure on this peripheral detail.

However, she was adamant that the only one she asked for money was D1, which is not surprising considering that all the other men were strangers to her.

I disbelieved D1 when he denied that she asked him for money. According to D1, she is just another of those people who by coincidence are claiming to have got cheques from him drawn on D2's account.

If P.W.3 is right in her recollection that D1 got the cheque from someone at the table, then the reasonable explanation of that would be that D2 was present too. She did not know D2 in Court, which would not necessarily be inconsistent with her having met him once only some three years previously among a group of several men she did not know.

The evidence as a whole left me in no doubt that D1 caused her to receive Exh. P1(33), even if some other hands might have touched it.

D1's lack of veracity was again revealed in his treatment of P.W.3's evidence. Firstly in cross-examining her (at page 37) he put a question to her which implies he denied ever handling the cheque. Then (at 470, 491 and 492) he opportunely comes up with the version that he did hand it to her but only for someone else.

From payments made by D1 out of the current account held in the name of D2, I will now consider payments which D1 made into that account.

One whole series of deposits made by D1 into D2's account comprises cheques given to D1 by his former partner P.W.11, drawn on the account which, it will be recalled, was employed by P.W.11 both for his own private affairs as well as for the business of Sun Po Lun. There are seven such cheques, being Exh. P5(1)-(7).

P.W.11 explained the purpose for which he issued each of those cheques to D1 and I accept his explanations, for I found him to be a reliable witness.

When admitting that he at least knew P.W.11, D1 denied being in partnership with him and also denied knowing anything about these cheques. I disbelieved D1 on this. Indicative of D1's generally lieing attitude before the Court was that, while denying that he was mixed up in the Sun Po Lun partnership, he, nonetheless, was able to put questions to P.W.12 about how P.W.11 had shared $300,000 profits among the three partners on three occasions, which indicated a degree of knowledge on D1's part which one would only expect to find in a partner.

In respect of each of the cheques produced in evidence the prosecution adduced a chain of evidence which established its provenance and ultimate destination. I do not think it is necessary for me in this judgment to go into all the details. The prosecution have done this with regard to the account held by D2 for D1 by furnishing what they have described as an Explanatory Chart, which I adopt. All the documentary evidence is there plainly in the record, and I accepted all that the prosecution witnesses told me about the cheques as true. Likewise, with regard to all the other documentary evidence relating to the bank accounts, I accepted the prosecution evidence on that.

With documentary evidence including cheques, there often used to be evidentiary problems because of the operation of the hearsay rule. Now, however, those problems have to a large extent been obviated by the operation of section 20 and section 22 of the Evidence Ordinance. A useful illustration of the operation of section 22 to prove the movement of cheques by reliance on the notations they bear is afforded by R. v. Sturgeon ⁽⁵⁾. The laws of evidence have now been brought more into line with common sense and common experience.

To reveal the workings of my mind, it might be as well to provide one example of the type of chain of evidence whereby the Crown proved the route followed by a cheque. Take Exh. P5(3) (which in combination with Exh. P1(32) was one of the most important exhibits in the case). P.W.11 identified that as one of the cheques on his account which he had issued to D1. The corresponding debit to P.W.11's account is to be found in P.W.11's bank statement, Exh. P4(58). The paying-in-slip leading to the deposit of this cheque into D2's account is Exh. P1(39). P.W.16, an officer of the Kowloon City branch of the Hang Seng Bank where the account was situated, testified as to this (see page 258) of the record). The various bank officers who testified explained to the effect that the notations on the cheque meant that it had been deposited at the Mong Kok branch of the Hang Seng Bank for crediting to account No. 34815 (D2's account) at the Kowloon City branch of their bank. The corresponding credit in D2's account is shown in D2's bank statement Exh. P1(6).

The combined evidence of Superintendents Lomas (P.W.4) and Porter (P.W.5), together with that of the messenger (P.W.9) and Chief Clerk (P.W.10) at Sham Shui Po Police Station, proved that D1, in his capacity of Barracks Sergeant, had cashed the cheques Exh. P2(1)-(6) for those Superintendents and had caused those cheques to be deposited in the account held by D2. D1 disputed this, but the evidence was overwhelming.

Likewise, I am sure that D1 received the cheque Exh. P3 from P.W.8 in connection with a mahjong game they played together. P.W.8 could not remember the details of the transaction, but I am sure it is the only reasonable explanation of how that cheque found its way into D2's account. Viewed in isolation, P.W.8's evidence would be too vague to establish that, but connecting his evidence up with all the other evidence in the case the conclusion I have just mentioned was reached.

D1 denied ever having played P.W.8 mahjong with so much money involved, but I disbelieved D1.

All those payments coming out of and going into D2's account for D1's purposes by themselves amount to cogent evidence that D2 was a mere front, holding the account for D1. Coupled with this is another piece of highly cogent evidence: D2 admits he was a front. This was one of the few true things D2 said in his evidence on the general issue, and this was of course evidence for all purposes of the trial including incriminating his co-accused. (The position is to be contrasted with D2's evidence on the voire dire and in his extra judicial statements Exh. P7(1) and (2) which was not evidence against his co-accused). In making this admission that he was a front, D2 was only bowing to the inevitable: there was no way he could have begun to explain some of the payments into and out of that account which were clearly for purposes unconnected with himself. However, D2 was not prepared to go the whole hog, which was to admit that the person for whom he held the account was D1. Instead of that, D2 came up with this imaginary character Fung Ming. His story about Fung Ming was so feeble as to be embarrassing. Fung Ming was supposed to have carried D2 on his back out of China at the time of the Civil War. Then they lose contact with each other only to be reunited in 1973. Fung Ming will not tell D2 his job, where he lives, whether he has a family nor anything else about himself. Nor will Fung Ming accept an invitation to D2's home. Nonetheless, Fung Ming prevails upon D2 to open this bank account without specifying what purpose it is to serve. Need I say any more than that this is all nonsense? D2 was obviously lieing to protect somebody: D1.

The Defendants are friends of long standing. From the evidence I am sure D1 did what he could to help D2, as for example finding him a job in Sun Po Lun, and D2 has reciprocated by running a bank account for D1. During his interlude as a civilian D2 was obviously well placed to fulfil this role. A serving police officer like D1, mixed up in any illegal activity such as off-course bookmaking, would obviously want to cover his tracks as far as possible, and who could have been better suited to help D1 in this than D2?

As I have gone along I have pointed out material which has undermined D1's credibility, and I have just referred to D2's talk about Fung Ming which has had the same result for D2. Another part of the evidence which served to show that the Defendants were not truthful to the Court was their description of how D2 used to pay D1 gambling winnings with cheques like Exh. P1(28) procured from Fung Ming. There seemed no plausible reason why D2 needed to place bets for D1 in the first place, and if he did, then it would have seemed natural for D2 to pay D1 with cash. Instead of that, D2 described an elaborate procedure whereby he would exchange cash with Fung Ming for one of the cheques which D2 himself had signed. Even less credible was D2's explanation of how he used to cash cheques for Fung Ming when one would have thought it was so much easier for Fung Ming to cash them himself as he already held the cheques signed by D2.

Several legal concepts might be resorted to in order to describe D2's relationship to D1 in so far as the account with the Kowloon City branch of the Hang Seng Bank is concerned. D2 could be fitted into the category of a trustee or an agent for D1. In more popular jargon, D2 can be called a front. No matter what term one uses to describe the relationship, the essential feature is that D2 is holding the money in the account to D1's order. As I indicated earlier in the judgment, I regard "control" as a question of fact, and in the present case the proved circumstances are such that D1 comes within the concept of "control" in relation to the funds in the account held by D2. I have no doubt that in the circumstances of the present case D1 knew all about the funds in this bank account D2 held for him, but even if he had not known, it would not necessarily have availed him anything for according to R. v. Sturgeon ⁽⁵⁾

"Prima facie evidence of mens rea (i.e. knowledge of control of assets) is entirely unnecessary in a case of this kind."

Having established that pecuniary resources in the shape of funds in D2's bank account are in D1's control, the remaining ingredient of the charge against D1 which the Crown bears the burden of proving is that of disproportion between those resources and D1's official emoluments. Here the figures can speak for themselves. As at 13th September 1973, the date of the first charge, D1's official emoluments totalled $141,786 whereas the bank balance he controlled was $246,970, and on the date of the second charge, namely 16th April 1974 official emoluments of $152,253 can be contrasted with a bank balance of $222,000. Thus, the difference between bank balance and emoluments on 13th September 1973 was $105,184, and on 16th April 1974 it was $69,747. I do not think I need labour the point: the Crown has proved disproportion.

A word can be said about the distribution of the burden of proof between the prosecution and D1 on the charges he faces. Hunt v. R. ⁽⁶⁾ (and see also the commentary on this case by Mr. Downey ⁽⁷⁾,) shows that the Crown has to prove beyond reasonable doubt:-

Once the Crown has discharged that burden, as it has in the present case, the onus shifts to D1 to prove on the balance of probabilities a satisfactory explanation as to how such resources came under his control.

So what was D1's explanation of these disproportionate assets which the Crown proved he controlled? He did not give any: instead, he tried to lie his way out by even denying knowledge of these assets. The absence of explanations from D1 notwithstanding, there were, nonetheless, what Crown Counsel described as "inbuilt explanations" of a satisfactory nature in relation to some of the funds which found their way into the bank account which D1 controlled. In this category are the deposits to which Exhibits P2(1)-(6), P3, and P5(1)-(7) relate. However, those deposits represent no more than a drop in the ocean. This was an actively operated bank account with wildly fluctuating balances. Those particular deposits I have just referred to are too small in relation to the funds deposited in the account satisfactorily to explain the massive credit balances D1 controlled on the dates specified in the charges. There is just no explanation, satisfactory or unsatisfactory, of those balances.

I cannot say it is more likely than not that all the additional funds credited to this account came from sources similar to the exhibits particularised in the last paragraph. If the facts would support that view, then I would consider a satisfactory explanation had been provided. In particular, if I thought it probable D1's resources could be explained on the basis of money he made from the San Po Lun off-course gambling school I would accept that as a satisfactory explanation. Although from an illegal source, the money from Sun Po Lun did not appear to be tainted with corruption. However, as I have said, I just do not know where those additional funds in the bank account came from, and in the absence of satisfactory explanation, D1's conviction becomes inevitable. Hence, I convict him on both charges.

As far as I am aware, D2 is the first person to stand trial before the courts on a charge of aiding and abetting the commission of an offence, contrary to S.10(1)(b). Till now the point has only arisen in CHENG Lai-kuen v. The Attorney General ⁽⁸⁾, which was only in the nature of interlocutory proceedings by a plaintiff whose travel documents were taken away from her by I.C.A.C. on the ground that they suspected her of aiding and abetting her step-father, a Police Superintendent, in the control of property disproportionate to his emoluments, contrary to S.10(1)(b), and she then sought the return of those documents. The learned Supreme Court judge who sat alone to determine that application rejected the plaintiff's submission that an offence against S.10(1)(b) was not capable of being aided and abetted and he refused to order the return of her travel documents to her.

Not wishing to be accused of lese-majestie I acknowledge I am bound by that decision as authority for the proposition that S.10(1)(b) can be aided and abetted, but, nonetheless, I must confess that I find the contrary view-point, put forward by Mr. Downey ⁽⁹⁾, the more persuasive.

Mr. Downey points to the analogy between the quaint concept embodied in S.10(1)(b) that the accused's explanation is to be given "to the court" and the requirement of S.30((he erroneously describes it as S.29) of the Summary Offences Ordinance, Cap.228 that where someone is brought before a magistrate charged with having anything in his possession reasonably suspected of having been stolen he commits an offence unless he "..... gives an account to the satisfaction of the magistrate". Under S.30 of the Summary Offences Ordinance it is well settled that the absence of a satisfactory explanation to the court is not a mere matter of defence, but constitutes one of the essential ingredients of the charge. See for example Chan Hoi and another v. R. ⁽¹⁰⁾ and LI Man v. R. ⁽¹¹⁾. Few would, I imagine, suggest that S.30 could be aided or abetted, and I regard S.10(1)(b) as an equally improbable candidate.

Once it is accepted that failure to give a satisfactory explanation to the court is an essential ingredient without which the commission of the offence is not complete, I find it difficult to see how the offence can lend itself to being aided and abetted. There is certainly something odd about an offence which is supposed to have been committed on 13th September 1973, but which lacks an essential ingredient until the case is actually in court some four years later.

In the CHENG Lai-kuen ⁽⁸⁾ case the learned judge seems to adopt the view that absence of an explanation is part of the actus reus of the offence, for he says,

"..... the offence under the section is not being unable to give an explanation but failing to give an explanation ....."

which echoes the well known distinction between material amounting to an essential ingredient of an offence and material the existence of which is a matter of defence.

There is no doubt that the general rule is that any offence can be aided and abetted (see Wilcox v. Jeffrey ⁽¹²⁾ and R. v. McCarthy ⁽¹³⁾) but, nonetheless, the legislature can express a contrary intention so that there can be exceptions to the rule: See Criminal Law and Practice in New Zealand by Adams, 2nd Edition (1971), paragraph 638, which, while commenting on the New Zealand Crimes Act 1961, also casts much light on the general common law position.

I would venture to suggest that S.10(1)(b) of the Prevention of Bribery Ordinance is one of those rare exceptions. (Section 30 of the Summary Offences Ordinance would be another)

That the learned Judge in CHENG Lai-kuen's ⁽⁸⁾ case recognized that there was something exceptional about S.10(1)(b) can be inferred from the doubts he intimated on whether the aider and abettor could be convicted unless the principal had first been convicted. Such doubts are only consistent with the view that the absence of explanation to the court is an essential ingredient which completes the commission of the offence.

However, the guilt of a secondary party cannot be made to depend on whether the principal first of all gets convicted. Ever since the Accessories and Abettors Ordinance, No.5 of 1865, which copies the Accessories and Abettors Act 1861, 24 and 25 Vic. C.94, the guilt of an aider or abettor has not had to depend on first of all convicting the principal: See Stephen's History of the Criminal Law of England, Vol. II 232, 235 and 236. The provisions of the Accessories and Abettors Ordinance have now been superceded by S.89 of the Criminal Procedure Ordinance, Cap.221 and S.85 of the District Court Ordinance, Cap.336.

Yet, positing that the principal's failure to give a satisfactory explanation to the court is an essential ingredient of an offence contrary to S.10(1)(b), how could a secondary party be convicted unless the principal was first of all tried? Of course, if the absence of explanation is a mere matter of defence the problem does not arise in the same way.

The reason the ordinary law relating to secondary parties will not work in relation to S.10(1)(b) is, I respectfully suggest, that the wording of that sub-section confines it to the actual Government servant who has to do the explaining in court.

CHENG Lai-kuen's case ⁽⁸⁾ tries to have it both ways: to make failure to give an explanation to the court an essential ingredient of the offence and yet to get the law as to secondary parties to work. The result is a distorted version of the law as to secondary parties.

Having acknowledged the binding nature of the authority of CHENG Lai-kuen's case as far as the District Court is concerned, I will now proceed to apply the principle it embodies to D2's position.

That the opening and maintaining of a bank account on behalf of another can in appropriate circumstances amount to aiding and abetting the commission of crimes facilitated by the existence of that bank account is explicitly demonstrated by the facts of Thambiah v. R. ⁽¹⁴⁾ which happens also to be a leading authority on the subject of the liability of secondary parties.

What is crucial to the determination of D2's guilt or innocence is the question of his state of knowledge as at 13th September 1973, which is the date specified in the first charge which is the only count he faces.

It is well established that before a person can be convicted of aiding and abetting the commission of an offence, it must be proved beyond reasonable doubt that he knows all the essential facts which constitute the offence (Johnson v. Youden ⁽¹⁵⁾, National Coal Board v. Gamble ⁽¹⁶⁾). Even in the case of an offence of strict liability - and it must be remembered that in some respects offences under S.10(1)(b) do involve strict liability (see R. v. Sturgeon ⁽⁵⁾) - the same principle applies: the principal offender may, but an abettor may not, be convicted without mens rea: See Smith & Hogan, Criminal Law, 3rd Edition p.109.

As an alternative to knowledge, it will suffice if the Prosecution can show that the secondary party is reckless in the sense of being wilfully blind to the circumstances which constitute the crime committed by the principal: R. v. Patel ⁽¹⁷⁾, Carter v. Richardson ⁽¹⁸⁾.

As the Crown rightly conceded in the present case, the test of recklessness is subjective. The mens rea which must be proved against the secondary party is the intention to aid and abet (R. v. Patel ⁽¹⁷⁾; R. v. Keene ⁽¹⁹⁾ and Thambiah v. R. ⁽¹⁴⁾). Intention is decided according to a subjective standard: S.65A, Criminal Procedure Ordinance, Cap.221.

A passage in CHENG Lai-kuen's case ⁽⁸⁾ indicates a test which could be applied to determine whether aiding and abetting had been established. The passage is as follows:

"..... if she assisted her step-father by taking control of his assets (or, as is here alleged, by concealing them) when she well knew that he was maintaining a standard of living in excess of that which was commensurate with his official emoluments and, further, that he was unable to give a satisfactory explanation, I see no reason why she should not be charged and convicted ....."

It was obviously due to an oversight that the test there was formulated on the basis of S.10(1)(a), for elsewhere in the judgment it was stated explicitly to be a S.10(1)(b) case.

Adapting the passage just cited from CHENG Lai-kuen's ⁽⁸⁾ case so as to make it appropriate to a S.10(1)(b) charge, what the Crown would have to prove against D2 is that he assisted D1 by taking control of D1's assets when he

"..... well knew that D1 was in control of pecuniary resources or property disproportionate to D1's and further that he (D1) was unable to give a satisfactory explanation".

I would respectfully suggest that the passage just referred to could be expanded into the following jury instruction: The Crown must prove beyond reasonable doubt:-

The Crown has abundantly proved the requirements of the first two limbs of that direction: D2 certainly knew that D1 was a policeman; he would be sure to have known what the salary of a police sergeant was and he knew, or was wilfully blind as to, the money in the bank account he held for D1.

However, the Crown has not satisfied me on the third limb. The evidence certainly proves that D2 knew all along that D1 wanted that bank account for the purpose of concealing funds arising from illegal activities, but the evidence does not go far enough to show that D2 knew those illegal activities involved corruption. If D2 knew that the money D1 was banking was tainted with corruption, then D2 would also know that D1 would not be able to give a satisfactory explanation to the court, in which event D2 would be guilty as charged, but if D2 might reasonably have thought that D1's money was from a non-corrupt, albeit illegal source, then because D2 would have cause to believe that D1 could come up with a satisfactory explanation to the court, then D2 is entitled to go free on the charge he faces.

For example, if it is reasonably possible that D2 might have thought that all the funds in the bank account were coming from Sun Po Lun or other similar off-course gambling establishments, then the Crown will have failed to discharge its onus which extends to negativing that sort of possibility. On the evidence before the court, I was not satisfied that the money derived by D1 from Sun Po Lun was tainted by corruption. In the context of the Prevention of Bribery Ordinance, I have taken corruption to have the lawyers' meaning of giving or taking bribes or advantages rather than the popular meaning of corrupt in the sense of decadent or rotten.

If D1 had satisfied me that the money he controlled was all from Sun Po Lun or establishments of the same ilk, I would not have convicted him. As it was, he left me in a state where I did not know where most of his money came from so, because he failed to discharge the burden of proof S.10(1)(b) lays on him, I had to convict him. However D2 is in a happier position under the law: far from D2 having to prove anything, the prosecution has to eliminate reasonable possibilities which might afford D2 a defence, and this the prosecution has failed to do.

Even on recklessness, in the subjective sense described earlier, the Prosecution does no better. I cannot be sure that D2 chose deliberately to close his eyes to activities of D1 which D2 suspected D1 might not be able satisfactorily to explain in court. Maybe all along D2 thought D1's activities were such that D1 would be able to give a satisfactory explanation in court if he ever came to face a S.10(1)(b) charge.

Just because D2 has tried to deny all knowledge of Sun Po Lun and has feigned ignorance of the source of the funds in the bank account does not lead to the inference that D2 knows those funds arise from a source tainted with corruption. The reason for D2's lies can just as easily be that he does not want to have to admit being mixed up in even non-corrupt illegal activities. D1 really faced the choice of Scylla or Charbidis: if he admits illegal activity of any sort, he naturally exposes himself to the risk of attracting other criminal proceedings; if he denies even non-corrupt illegal activity, he gets convicted because his proved assets go unexplained. This is the result of his carrying part of the burden of proof, and the practical effect is that for someone in D1's position the general right to silence afforded by the criminal law has become worthless. D2's dilemma is not quite so acute: because he lies about his knowledge of the source of the assets in question, he has not made his conviction inevitable in the present case because the Crown has to disprove all reasonable possibilities operating in his favour.

Just because D2 intended to assist D1 with one type of illegal activity such as, say, running an off-course gambling business, it by no means follows that he intended to assist him to perpetrate other forms of illegality such as corruption of one type or another. The courts have developed the concept of "particularity of intention", whereby a person who intends to assist in the commission of one type of crime is not liable if a crime of a different nature is committed. It is not sufficient to show that the secondary party has what might be described as a general criminal intention. Knowledge of, or at least wilful blindness towards the particular type of crime must be proved. The concept is explained in R. v. Thambiah ⁽¹⁴⁾ and other illustrations of it are R. v. Patel ⁽¹⁷⁾ and R. v. Bainbridge ⁽²⁰⁾.

In the present case I cannot be sure that D2 intended to assist D1 with anything corrupt. Hence, for the foregoing reasons, I find D2 not guilty.

Representation:

(1) (1976) H.K.L.J. 27 at 30 foot-note 16.

(2) Misc. Proc. 334/77.

(3) (1975) H.K.L.R. 326.

(4) 60 Cr. App. R. 80.

(5) Cr. App. 679/75

(6) (1974) H.K.L.R. 31.

(7) (1976) H.K.L.J. 27 at 41.

(8) Misc. Proc. No. 120 of 1975.

(9) Combatting Corruption: The Hong Kong Solution, 1976 H.K.L.J. 27 at 33, foot-note 23 and at 64, foot-note 97.

(10) (1966) H.K.L.R. 42 (per Briggs J., as he then was) at 45, paragraphs 5 and 6.

(11) (1952) H.K.L.R. 77 at 83.

(12) (1951) 1 All E.R. 464 at 466.

(13) (1964) 1 All E.R. 95.

(14) (1966) 2 W.L.R. 81 at 87.

(15) (1950) 1 K.B. 544 at 546.

(16) (1959) 1 Q.B. 11 at 18.

(17) (1970) Cr.L.R. 274.

(18) (1974) Cr.L.R. 190.

(19) (1971) Cr.L.R. 520 at 527.

(20) (1959) 3 All E.R. 200.