Kwok Hung-fai and Others v. The Queen
Read the full judgment text of CACC 384/1982 on BabelCite. This Court of Appeal judgment was delivered on 1 September 1982.
1. The appellants appeal against their conviction by a magistrate under Regulation 30(b) of the Miscellaneous Licences Regulations Cap. 114. The matter has been referred to this court by Bawled, J, in accordance with the provisions of section 118(1)(d) of the Magistrates Ordinance Cap. 227.
Cited by 1 case
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CACC000384/1982 Infringement of licence conditions under Regulation 30(b) of the Miscellaneous Licences Regulations, Cap. 114 - Regulation 30 does not create an absolute offence except in the sense that the licencee will be responsible for acts of his delegate whether he is aware of them or not and even if he has forbidden the act or acts complained of - per Li, J.A. and Jones, J. - per McMullin, V.-P. both Regulation 30(b) and Regulation 32(b) create absolute offences in the extended sense in which that term has been understood in the English licensee cases - In cases taken under either provision the nature and extent of the delegation will be a matter of paramount importance. Appeals allowed on the basis that such vicarious liability had not been proved the necessary link of master/servant or principal/agent not having been established on the evidence adduced.
BETWEEN
_________ Coram: McMullin, V,-P., Li, J.A. and Jones, J. Date: 1 September 1982 __________ JUDGMENT __________ McMullin, V.-P. : 1. The appellants appeal against their conviction by a magistrate under Regulation 30(b) of the Miscellaneous Licences Regulations Cap. 114. The matter has been referred to this court by Bawled, J, in accordance with the provisions of section 118(1)(d) of the Magistrates Ordinance Cap. 227. 2. Before the magistrate the appellants were also convicted of an offence contrary to Regulation 32(b) of the Miscellaneous Licences Regulations. However, when the appeal came before Bewley, J., he quashed those convictions because the Crown conceded that mens rea was required whereas the magistrate had treated the offence on the basis that it was absolute. The Crown now withdraws the concession that the convictions should have been quashed although adhering to the view that the offence cannot be proved without mens rea. 3. Regulation 30(b) provides :-
4. Regulation 32(b) provides :-
5. The facts reveal that on the 18th October 1981 at 10.15 p.m. two male police officers in plain-clothes posing as customers went into Sun Hing Court, a massage establishment, in Nathan Road. After taking a steam bath they put on shorts provided by the establishment. One police officer was massaged by the 5th appellant and the other by the 6th appellant for approximately one hour. Both appellants were fully dressed. There was no suggestion that any indecent act took place. 6. A party of police officers raided the premises 20 minutes later when the 2nd, 3rd, 4th, 5th and 6th appellants were arrested. The 1st appellant was arrested 3 weeks later. 7. During the raid the 2nd, appellant admitted that he was the manager, but said that the licensee was not present. The police found more than 50 male customers on the premises lying on beds wearing shorts. 8. It is not in dispute that the 1st appellant is the licensee of Sun Hing Court and another establishment on the same floor, the Sunlite Court which is a commercial bathhouse with gymnasium facilities. 9. The 1st appellant was charged with two offences viz:-
10. The other appellants were charged as aiders and abettors of the 1st appellant in respect of the two charges. 11. After the conclusion of the Crown case, the magistrate of his own volition amended the particulars of the offence as follows:-
12. It will be observed that the magistrate made a significant amendment to the charge under Regulation 30(b) by including the word "allowing". Such an amendment indicates that mens rea is required for this offence. The appellants elected not to give evidence. 13. All the appellants were convicted and fined on both charges. The magistrate held that the two offences were absolute. 14. Both counsel for the Crown Mr. Lyons and counsel for the appellants Mr. O'Reilly Mayne maintain that Regulation 32(b) is not absolute so that mens rea is an essential ingredient. Mr. O'Reilly Mayne contends that there was no evidence before the magistrate on this charge to justify a conviction whilst Mr. Lyons submits that there was evidence albeit circumstantial. 15. However, the main argument in this appeal was whether Regulation 30(b) created an offence of strict liability or whether its proof requires mens rea. 16. The common law rule is clear that mens rea is an essential ingredient of a crime. The requirement may be displaced by statute where the words describing the offence are clear or by consideration of the subject matter. It is necessary to consider what is the mischief at which the regulation is aimed at and the intention of the legislature. 17. It is agreed that if the 1st appellant's appeal is allowed, the appeals of the other appellants will also succeed as they are charged as aiders and abettors. 18. Mr. Lyons submits that by the wording of the regulation the 1st appellant is liable without proof of mens rea provided that a master and servant or agent relationship is established between him and the other appellants. Without this construction he maintains that the regulation would be rendered largely nugatory. 19. With regard to Regulation 32(b), he contends that as mens rea is necessary he must also prove that there was a delegation of authority by the let appellant. The 1st appellant would then be vicariously liable by virtue of the provisions set out in Section 8 of the Miscellaneous Licences Ordinance. 20. Section 8 provides:-
21. Mr. Lyons drew an analogy between Regulation 30(b) and section 59 of the Licensing Act 1964 which is an offence of strict liability. 22. Section 59 provides :
23. The maximum penalty provided for a breach of Regulation 30(b) under Regulation 17 is a fine of $10,000 and imprisonment for 6 months. Mr. Lyons cited three Hong Kong authorities for his proposition that Regulation 30(b) is absolute. 24. In LAU Hoi-kit & another v. R. (1) , Yang, J., did not have to decide the point for he quashed the conviction as he held the magistrate to have erred by ''relying upon evidence against the appellant licensee which was inadmissible. Zimmern, J., without hearing full argument, expressed his view obiter in KW0K Hung-fai & others v. R.(2) that Regulation 30(b) is absolute. Bewley, J., in POON Chun-yuen v. R.(3) decided that Regulation 30(b) is absolute. 25. Mr. O'Reilly Mayne argues that it is necessary to look outside the meaning of the words to determine the real intention of the legislature. He submits that the following matters should be taken into consideration:-
26. Two passages cited by Bewley, J., in POON Chun-yuen v. R.(3) are particularly relevant. 27. In Sweet v. Parsley (4) Lord Reid said :
and later on:-
28. In LIM Chin-aik v. R.(5) Lord Evershed said at page 174:-
29. These passages are useful in illustrating the contemporary state of authority in the highest English courts both in favour of and against the existence in any statutory provision of an offence of strict liability. The actual nature of the strict liability offence has, however, received very little direct discussion in these cases. What is strict liability? 30. The phrase has been somewhat confusingly used. Mr. Lyons distinguishes the prohibition set up by Regulation 30 from that in Regulation 32 by reference to the word "allows" which appears in the latter regulation. In common with Bewley, J., he holds to the view that that word necessarily connotes the requirement of mens rea as a component o￡ the offence. In a case taken under that regulation, he says, knowledge of the nature of the act and intention to carry it but must be shown in someone before the offence is proved. But that someone may be the person who actually executes the act or someone bound to the executant by a relationship of master and servant or of principal and agent. In other words liability maybe personal or vicarious but it is not absolute. 31. In maintaining that, by contrast, Regulation 30 creates an offence of strict liability, Mr. Lyons, nevertheless, concedes that here too a link of service or agency must be shown before any person can be convicted who has not personally carried out the act or acts which constitute the failure to observe one or more of the licence conditions. He discerns the crucial distinction between the offences created by these two regulations in the scope or degree of delegation of duties which may be gathered from the evidence in any given case. Thus a master or principal would not, he says, be liable for an act of the servant or agent unless upon the evidence it was clear that the act of the latter was within the ostensible authority delegated to him by the former. If it was, then the act together with its necessary components of knowledge and intention on the part of the servant or agent will be attributed to his principal. That seems to me to be a perfectly proper enunciation of the principles attending vicarious liability. What I cannot see is that such principles are any less applicable to an offence under Regulation 32 than they are to one under Regulation 30. Under either regulation the offence may be proved by showing direct personal knowledge in the licensee or else by attributing to him the knowledge of his servant or agent. In cases of the latter kind, whether under Regulation 30 or 32 there will be an attribution of act, knowledge and intent of a purely fictitious kind to fix with liability a person who is innocent of all three. But if an offence of strict liability is to be contrasted with one requiring mens rea, the contrast disappears once vicarious liability is invoked. What that introduces is a fiction and this fiction imposes liability by fixing the principal with guilty knowledge and intent and not by excluding the need for them. It is only thus that the act itself is brought home to him and laid at his door. 32. Whether the relationship is one of master and servant or of agency in the broader sense then, provided one adheres to the idea that mens rea, direct or imputed, is required, it will be seen that in cases which are said to disclose imputed mens rea the scope of the delegation will be the paramount consideration. 33. Following Mr. Lyon's argument, one can be rendered vicariously liable either for allowing massage of the forbidden kind (Regulation 32) or for failing to observe the terms of one's licence (Regulation 30). 34. One would think that in the purest and simplest sense an offence of strict liability is one to which all considerations of mens rea direct or imputed are simply irrelevant. Good examples of this kind of strict or absolute provision are to be found in some of the modern legislation in the United Kingdom where the freedom of the subject has been greatly abridged in favour of what is seen as the interests of the community at large. 35. Thus section 39(1) of the Education Act 1944 provides that :
36. Again, it is provided by section 1(1) of the Oil in Navigable Waters Act 1955 (as amended) that:-
37. Under such provisions as these it would seem not to matter in the least how the offending situation arose. The clear intent of the legislature would seem to be that the situation is itself so undesirable that a very heavy burden is to be placed on the shoulders o￡ those who might be regarded as nearest to it in terms of control. They are, therefore, to be charged with responsibility irrespective of any consideration of guilty knowledge or intent. Probably, under the latter Act it would not matter how the oil spillage occurred, whether through the negligence of servants or agents or through the interference of trespassers or even possibly of pirates. 38. The absolute character of the offence in the former Act is illustrated by the decision of the Divisional Court in Crump v. Gilmore(8). 39. These examples are taken from the helpful and illuminating contribution by P.R. Glazebrook who also edited the book of essays entitled Reshaping the Criminal Law published in honour of Professor Glanville Williams in 1978. The writer at page 108 et seq. is treating principally of the concept of vicarious liability in criminal law. He is clearly dissatisfied with it and he would like to see it subsumed into a wider category which he calls "situational liability". In relation to the two legislative provisions cited above he points out that how or by whose fault the prohibited situation came about are factors which are not included in "the external elements of the offence". 40. The licensing cases, which have for long been regarded as a special area in relation to the question of liability, he regards as one more instance of situational liability. Proceeding from the robust to the abrasive, he affects to regard the principle of delegation, deriving from those cases, as judicial make believe which "certainly does not deserve to be dignified by the name of 'the delegation principle' for it is nothing more than a low wheeze (to which the Scots judges do not stoop)" (p.113). 41. Whatever about the superior attractions of Scots logic, one need not go the whole way with this sprightly opinion to be grateful for the light incidentally thrown by the writer upon a doubtful corner of the law. It is the element of make believe which presumably causes the discomfort. If, instead of inquiring whether the prohibited act was reasonably within the delegated duties so that the servant's or agent's act is held to be that of the master or principal, one were instead to inquire whether what was forbidden was the arising of a situation which the master or principal might be expected to prevent one would, I think, be closer to founding liability upon firm and easily discernible ground rather than by placing it in the area of delegated authority. On such an approach the licensee's fault would be one of omission - a failure to prevent and not a bringing about of the prohibited situation. 42. This appears to have been the approach of Bewley, J., in POON Chun-yuen v. The Queen(3) when, in common with Zimmern, J., in KWOK Hung-fai & ors. v. The Queen(2) , he interpreted Regulation 30 as creating strict liability. Bewley, J., pointed out that in the latter case as in LEE Fei-yuen & ors. v. The Queen(9) and in LAU Hoi-kit & anr. v. The Queen(1) the charges taken under Regulation 30 all alleged a positive act on the part of the licensee who in each case, as in the present case, was not in the premises when they were raided by the police. In the charge before him the offence was properly laid as a failure to observe the terms of the licence. In the present case the magistrate sought to amend the Regulation 30 charges to bring them into alignment with the words of the regulation. Unfortunately in doing so he particularized the failure to observe the licence conditions as "allowing" the operation of a massage establishment etc. It is conceded that this is a misdescription of the offence. Indeed, if Regulation 30 was correctly put to work in that way, there would seem to be no reason why the judge below should not, upon the concession of counsel, have also dismissed those charges. However, no point is taken here on this misdescription. It is conceded that the substance of the offence is failure to observe the terms of the licence. 43. In LAU Hoi-kit (1) , Yang, J., did not consider and was not asked to consider in any depth the nature of strict liability since the Crown relied wholly upon Linnett v. Metropolitan Police Commissioner (10) which was a case of vicarious responsibility and there was, as the judge found, no evidence of delegated authority. 44. It would seem that the decided cases have discerned at least two different senses in which an obligation can be said to be of strict or absolute liability. The first and strongest is that arising from provisions cast in the form of the English legislation cited above. Hopkins v. Ellis(11) although one of the licensing cases (of which more is to be said hereafter) falls into this first category. Liquor was sold to a customer by the wife of a licensee he being present on the premises. He was under the mistaken but genuine impression that the permitted hours for sale had arrived. The justices dismissed the charge as being of a trifling nature. The Divisional Court was principally concerned to reprove that suggestion. But in sending the case back to be dealt with on the basis that an offence had been committed the superior court said that in the absence of any term such as "knowingly" from the section a genuine mistake of fact is no defence under section 13 of the Licensing Act 1872. This and some other cases in a similar vein are authority running counter to the general rule that mistake of fact may afford an answer to a criminal charge. Hopkins(11) itself is not an entirely satisfactory authority on the point. The licensee's wife not only sold the liquor but, unknown to her husband, altered the hands of the clock. This gave rise to the mistake which he pleaded. His wife must surely have known that she was selling liquor out of hours yet the question of delegated powers does not seem to have been raised. Presumably the reason for not ascribing the licensee's guilt to imputed mens rea rather than to responsibility in this first and purest sense is the somewhat artificial distinction drawn in some of the cases between the situation of a licensee who is absent from the premises when the act occurs and that of the licensee who is present and in overall control but is unaware of the act of his servant or agent. 45. Amore diluted sense of what constitutes strict liability may be discerned in decisions under the English Licensing Acts. It is the sense which is directly relevant to the kind of case we are now dealing with. 46. If the licensing cases are indeed a special category within the law relating to criminal liability - and it is thus that they have always been regarded in the courts - it may well be that their anomalous character derives from the fact that the principle of delegation has been invoked by the courts to force such cases into a category to which they do not logically belong. Indeed, Mr. O'Reilly Mayne in the course of his argument professed to see a contradiction in the judgment of Bewley, J., in Criminal Appeal 193 of 1981 precisely because the latter had found both that the offence was absolute in its nature and that it was open to the defendant to protect himself by delegating his powers and duties. I think this may have been a misunderstanding of that part of the judgment of Bewley, J., but the confusion, if it exists, is probably due to the fact that, the case law notwithstanding, the notions of strict and vicarious liability are not logically compatible. 47. Be that as it may, there is no doubt that high academic authority, leaning upon the cases (which are generally less explicit on the point, as to basic principle) supports the inclusion of both types of case within the strict liability category. Thus we find Halsbury (Vol. 11 4th Edition, page 41, paragraph 53) in treating of vicarious liability in the criminal law concluding that : "Such liability may arise where the offence is one requiring mens rea or one imposing strict liability.". The footnote to this particular statement leads, by way of confirming illustration, directly to section 59 of the Licensing Act of 1964. 48. Mr. Lyons leans heavily on this section as affording a parallel to Regulation 30. More particularly he relies on the several cases collected in the commentary upon that section which is to be found in Patterson (op. cit.) at page 586. The editors cite Barnard v. Barton (12) and they continue :
49. In Barnard v. Barton(12) , justices, purporting to act under powers given by section 16 o￡ the Summary Jurisdiction Act 1879, dismissed, on the ground (as in Hopkins v. Ellis(11) ) that the offence was trivial, charge of selling liquor while unlicensed contrary to section 3 of the Licensing Act of 1872. The Divisional Court declined to take the same view and sent the case back on that ground. No question seems to have been raised either in argument or obiter as to the nature of vicarious liability as a special category of strict liability. 50. Cartman(13) (cited above) was a case under section 16 of the Licensing Act 1872, It is one of the "delegation" cases, the point at issue being the scope of delegated authority. The same is true of Coppen v. Moore (14); Collman v. Mills(15) ; Adams & Gamfoni (16) and Auld v. Devlin (17) . These cases are cited by Patterson in the text as supporting the proposition set out above. In none of these cases, all of which concern activities governed by licence, do we find either argument or obiter on the nature of the offence as absolute. In all of them the question at issue is whether knowledge, etc. of the servant or agent is to be imputed to the defendant and it is assumed that due delegation will attract absolute liability. The law in Hong Kong would seem to differ from the various legislative provisions which were in issue in these English licensee cases in that we have in section 8 of the Ordinance a statutory application of the vicarious liability rule which additionally fortifies the rule by providing that the delegate himself is, in effect, to be treated also as a principal. This provision does not of itself create liability which is absolute in the sense that a guilty mind need not be shown either in?the licenser or his delegate. 51. If, therefore, counsel for the Crown is right to find the requirement of mens rea in the wording of Regulation 32 it is nevertheless, in the circumstances of this case, mens rea of a wholly fictitious or imputed kind, as it was in the several cases just now referred to. 52. Again, if, as Patterson suggests, those cases support the notion of strict liability, then clearly they afford no good ground for distinguishing between Regulations 30 and 32. Rather do they support the idea that the offences created by both of those regulations are alike offences of strict liability. 53. Mr. Lyons has however, conceded that evidence of delegation was, in any event, weak. The only evidence in fact was that given by Inspector Chan who said that the 2nd defendant (CHOI Tuen) identified himself as manager and that the 3rd to 6th defendants were patently engaged in supplying massage on the premises when the police arrived. This coupled with the fact that the 1st defendant was the holder of the licence was enough, in his contention, to amount to at least a prima facie case against all of the defendants even in respect of the charges under Regulation 32. On this point, however, Mr. O'Reilly Mayne is clearly right. Although section 8 of the Ordinance, Cap. 114 makes master or principal liable for the acts, omissions etc. of his servants or agents and makes the latter liable for the act or omissions of the former as though the servant or agent was himself the licence holder, for those widely embracing provisions to have effect in the individual case it would still be necessary to show the nature and extent of the link between master and servant, principal and agent. In the present case the evidence did not even go so far as proving the 2nd to 6th defendants were in the employment of the first. 54. In what other manner could liability under either regulation be ascribed to these appellants? 55. Professor Glanville Williams draws attention (page 284, the General Part) to a factor of great importance in resolving the ambiguities which beset the notion of strict liability. He says :
Earlier (p.106) he has pointed out that where knowledge is required by implication from the words of the statute (and presumably a fortiori where the requirement is explicit) it means the personal knowledge of the defendant "The knowledge of a servant is not imputed to the master except in the licensee cases." (emphasis added). 56. These general observations are helpful in clearing the ground. The anomalous character of the licensee cases resides in the fact that in their regard strict liability constructions invariably arise, and can only arise, under circumstances of delegation. Mena rea - unnecessary in the true strict liability cases - is invoked to chasten the overly complacent licensee. His liability is said to be strict because the guilty mind which condemns him is not his own. 57. But delegation for this purpose is necessarily a very broad concept. It is not confined to the kind of contractual relationships which are treated of in the law of Master and Servant, Principal and Agent (see Goddard, L.C.J., in Linnett(10) at p.294). Where such defined relationships exist no doubt the prosecutor's task may be rendered easier. But a licensee may find himself caught by the act of one bound to him by delegation of a quite informal kind such, for example, as might arise where a friend or relative is put temporarily in charge of the premises. 58. For this reason it seems to me impossible to distinguish between Regulations 30 and 32 as Mr. Lyons has done on the basis that while it is necessary to show a Master/Servant, Principal/Agent relationship to prove an offence under either regulation it is necessary in addition to prove something further by way of delegation of specific powers in bringing home a charge under Regulation 32. This, with respect, is a wholly artificial distinction to which counsel was compelled by an endeavour to maintain that one provision imposed strict liability and the other did not. The truth is that strict liability - in the extended sense in which it is understood in the licensee cases-may arise, via the delegation principle, under either regulation. Therefore, although it may be conceded that the use of the word "allows" in Regulation 32(b) indicates mens rea as a necessary ingredient of the offence, that ingredient is not restricted to the need to show knowledge and intent on the part of the licensee personally. Where the forbidden act has been done without his knowledge, he may still be responsible for allowing it by virtue of the delegation principle. 59. As for Regulation 30(b), the real question here is whether, in the absence of sufficient evidence of delegation, strict liability must be said to arise from the very words used in the regulation. That regulation must be read in the light of the general principles relating to the construction of penal statutes, and having regard, as Mr. O'Reilly Mayne properly demands, to the nature of the offence, in forming an opinion as to whether a strict construction would lead to an absurd or unjust result by imposing a burden wholly incommensurate with the nature of the disorder struck at by the legislation. Thus considered, counsel says, we should be slow to conclude that an offence for which one of the appointed penalties is imprisonment for up to 6 months, could reasonably be interpreted as imposing strict liability. This is so, Mr. O'Reilly Mayne says, more especially because such Licences are issued only after due inquiry by the licensing authority into the character and background of the applicant. There is also the fact that the public interest is further safeguarded by Regulations 26 and 28 which, respectively, subject the choice of employees to approval by the authority and oblige monthly returns in writing to be submitted by the licensee to the authority relating to all persons employed on the premises. 60. These are important considerations. What can be said upon the other side? 61. Although the decision of Bewley, J., in Criminal Appeal 193 of 1981 is on the face of it in his favour (as also, by strong inference, the opinion of Zimmern, J., in Criminal Appeal 655 of 1980), Mr. Lyons does not rely upon it for the reason that he interprets it as founding the guilt of the defendant on mere possession of the licence, something which Patterson, citing Taylor v. Speed(18) (infra), categorically condemns. This does the decision of Bewley, J., less than justice since he was at pains to consider the prescriptions of Sweet v. Parsley(4a) - even to quoting extensively from the speeches of Lord Reid and Lord Evershed - as to the circumstances proper to be considered before the court can safely conclude that a statutory provision intends strict liability. While Bewley, J., did not consider that after-hours massage was to be regarded as a grave social evil, he thought (following the line taken by Lord Evershed in LIM Chin-aik v. R.(5) ) that the ordinary presumption that such liability is not intended was displaced by a presumption (gathered from the nature of the offence, the circumstances which might generally attend it, and the difficulty of enforcing the law) that the licensee was absolutely bound to observe the terms of his licence. 62. This is indeed the alternative ground on which Mr. Lyons has advanced his argument. Firstly he points to the fact that there is wanting in Regulation 30 any term implying the need to show mens rea in a licensee, although he concedes that that is not a conclusive indication. Then he says that the offence is not one of true criminality attracting grace moral stigma. And finally he urges us to consider that strict liability imposed upon a licensee would be effective to curb the disorder which it is sought to control and would do so without excessive hardship to the licensee who would thus be encouraged to select reliable staff if he did not propose to supervise the business himself. 63. I confess that if I thought the matter was to be disposed of wholly by reference to the contrasting merits of these opposed contentions, I would find the decision a difficult one. On the one hand we are being asked to displace the presumption of mens rea upon the implied intention of the Legislature in a provision which does not make that intention explicit as it might very easily have done by the use of different language. On the other hand, there is the apt and strongly persuasive approach of Lord Evershed to be found in the passage from his speech in LIM Chin-aik(5) , which has been quoted above, upon which Bewley, J., relied. It is worth repeating a part of that passage here:
64. This would seem to support the "situational" approach whereby in a fitting case mens rea regarding the prohibited situation would be of no concern. It is to be noted that Lord Evershed does not go so far as saying that without strict liability the legislation will be rendered nugatory. I do not doubt that such an interpretation of Regulation 30(b) would tend to promote a livelier interest on the part of licensees in the management and supervision of such establishments. 65. Again, the nature of the penalty is a weighty consideration and I am aware that it has been said more than once (Cf. R. v. Warner(19) ; and LIM Chin-aik(5) ) that a strict liability interpretation should not be founded on the assumption that the fair enforcement o￡ the law can be left to the good sense of the prosecuting authorities so that a nominal or venial fault will not be pursued; nor yet to the good sense of the courts to see-to it that, if pursued, the' penalty imposed will reflect the nature of the fault. 66. As against that it must be said that the availability of a prison sentence is not itself a conclusive determinant in favour of requiring mens rea. For a start, there is some discordance between the idea that the gravity of the social evil enhances the likelihood that absolute prohibition is intended and the contention that the gravity of the penalty obliges the opposite view. One would expect to find - and generally one does find - that the greater evil attracts the greater penalty. Qute apart from that there are cases in which the courts have expressed a very different opinion on the significance of the prison sanction. (See Hobbs v. Winchester Corporation (6) - judgment of Cozens-Hardy, M.R. at page 481; and Channell, J., in Pearks etc. v. Ward(20) at page 11.) 67. All in all I would not think it very unreasonable where it is provided that a licensee shall observe the terms of his licence to say that it was plainly intended to lay upon him a duty to see to it that the terms were observed, whatever measures might be necessary to ensure that end and even though the draftsman of the regulation had failed to underscore that intention by the use of language so unambiguously plain as to put the matter beyond any doubt. Pre-eminently the licensee is a person who, in the words of Lord Evershed quoted above, can do something "directly or indirectly, by supervision or inspection, by improvement of his business methods or by exhorting those whom he may be expected to influence or control which will promote the observance of the regulations". 68. If this were not a licence case, I would respectfully adopt the very strong words used by Lord Guest in R. v. Warner (19) in holding absolute an offence under section 1(1) of the Misuse of Drugs Act 1964 the operative part of which reads :
He said :
That case raised different considerations from what is at issue in the present case (principally arising from what constitutes possession of dangerous drugs in the "container" cases, about which there was a measure of dissent). But there was no dissent on the power of the words in section 1 to create absolute liability in the strictest sense. 69. We are, however, in the very special area of licensees and the current state of authority in England, though not strictly binding, is sufficiently persuasive to be decisive. It is clear that to hold that Regulation 30 obliges absolutely in the strictest or "situational" sense would of necessity mean holding that the mere possession o￡ the licence was enough to attract liability. 70. In Taylor v. Speed(18) (a note of which appears at page 114 of the Criminal Law Review 1979) the Divisional Court, with the Chief Justice presiding, was dealing with an appeal from a magistrate. The defendant held a licence for the sale of liquor on premises used as a restaurant by a company which had not obtained the transfer of the licence for its own use. He had no connection with the company and was not present when a servant of the company supplied liquor outside the permitted hours. He appealed by way of case stated from his convictions upon 2 charges under section 59(1)(a) of the Licensing Act 1964. The appellate court upset the convictions since there was no evidence that those who served the liquor were his servants. It was said that a conviction could not be founded on mere possession of the licence. 71. This case may be contrasted with Bennett v. Hanks(21) Once again the report is very brief, Section 100(1)(a) of the Licensing Act of 1955 is for all material purposes the same as section 59(1)(a) of the later Act : “............. no person shall, except during the permitted hours, himself or by his servant or agent, sell or supply ......... any intoxicating liquor.". A brewery company owned s hotel. The liquor licence was held by their local agent who lived 20 miles away. The company employed a manager who lived on the premises. The manager supplied liquor outside the permitted hours. The licensee was acquitted by the justices on the ground that he had no knowledge of the managers act. The Divisional Court (Goddard,L.C.J., presiding) held, following Metropolitan Police Commissioners v. Cartman(13) , that the offence was absolute and that the licensee was vicariously liable for the illegal sale it is not altogether easy to distinguish these cases by reference to the principle of delegation. The arrangement of duties and responsibilities between owners, licensee and manager is not mentioned in Bennett (21) (which does not seem to have been referred to in the later case). One can only safely conclude that the cases are to be distinguished by reference to the probability that in Bennett (21) there was a three-way nexus between the several parties which would have entitled the court to conclude that there had been something in the nature of a joint delegation of control to the manager, whereas in Speed(18) the licensee would seem to have been wholly detached from the company's operation (a fact which caused the writer of the commentary on that case to query whether, since the licensee had presumably not delegated his authority, any sales of liquor, even within the permitted hours, would have been lawful). 72. I conclude that notwithstanding the mandatory form in which Regulation 30(b) is cast, mens rea - in the extended sense in which that has been understood by the courts in the licensee cases - is a necessary ingredient in the proof of an offence under that regulation as it is in respect of offences pursued under Regulation 32(b). Under both regulations, that is to say, where the licensee has not personally performed or supervised the forbidden act, there must be evidence of delegation sufficient to show that effective control of the massage establishment has been put by the licensee, in the hands of his delegate and that such control can reasonably be interpreted as extending to all such acts of the delegate as would be within the scope of the licensed activity whether lawfully performed or not. 73. I put the matter in this way in view of counsel's contention that to countenance vicarious liability under the law as it stands would necessarily involve the prosecution in showing that the licensee had counselled a breach of the law when the charge is taken under Regulation 30(b). That is not so. In the absence of evidence or of special provisions in the law, no one can be presumed to have connived at an offence. The delegation principle is highly artificial. It abridges the process of proof far more radically than does any mere presumption in law. The latter generally works by shifting the onus of proof upon certain minimal conditions; delegation, once demonstrated, fixes guilt irremovably. The act of the delegate is fastened upon the licensee as though it were in very truth his own. Mens rea there must be but only of the imputed variety. It is in that sense that the offences created by Regulations 30 and 32 are, when they are laid at the door of an absentee licensee, to be considered absolute offences. To this conclusion a solitary caveat must be entered. It may be that in a case - which is likely to be very rare - where the delegate has breached the law through a genuine misapprehension of fact it could be said that, wanting mens rea himself, he was incapable of passing it to the licensee. Hopkins v. Ellis(11) would seem to be against that, but, as has been said, it is not a very satisfactory authority. Section 8 74. It follows from what` has been said that this section does not-by itself oust the need to show the necessary degree of delegation. In the present case the evidence did riot show the nature of the link, if any, between the first and the second to sixth defendants. It is for that reason only that I would allow the appeals and quash the subsisting convictions. The fines, if paid, must be returned to the several appellants.
Li, J.A.: 75. I have the benefit of reading the judgment of the Lord the Vice-President and that of my brother Jones. With Respect, I agree with both of them in their conclusions that the conviction of all appellants should be allowed, the conviction quashed and the sentences set aside. This should be sufficient to dispose of the subject matter of this appeal. 76. Once the 1st appellant succeeds in arguing that there was no evidence, however slight, that the other appellants, 2 to 6, were his servants or agents, the lst appellant could, not be convicted of any offences committed by the other appellants solely and simply because he was the licensee of the premises in question. If the 1st appellant is not guilty of any offence, it follows that the other appellants who have been charged as aiders and abettors could not be aiding and abetting any offence. I would rest my decision solely on this basis. 77. However, counsel for the Crown with the support of counsel. For the appellants, for good reasons, invites us to consider the broader issue whether regulation 30(b) of the Miscellaneous Licences Regulations, Cap. 114, creates an absolute offence. Regulation 30 of the said Regulations provides as follows:
78. Counsel for the Crown contends that this regulation creates an absolute offence with absolute liability. He develops his argument, if I understand him correctly, into two limbs, namely: 1. Absolute liability on the part of the licensee. 2. Absolute liability on the part of the licensee's servants or agents. On my part, I frankly confess I fail to understand the first limb of his argument. Section 8 of the Miscellaneous Licences Ordinance provides as follows:
In view of the provisions in section 8, once it is proved that the licensee's servant had committed a breach of condition - be it under strict liability or committed with guilty knowledge, and that master and servant or principal agent relationship is also established - then the licensee of the establishment will be liable even though the licensee himself has no knowledge whatsoever of the breach. In that sense, the liability of the licensees may be said to be absolute, i.e. he may be found guilty even if he himself had no guilty knowledge whatsoever. It will not help the licensee or absentee licensee even if the breach by the servant/agent was committed contrary to the master/ principal's expressed instructions or prohibitions. In that sense, the liability of the licensee is absolute. However, the absolutism in this sense applies only to the vicariousness in his liability. Thus, it is said that the master/principal is imposed with a liability be it vicarious, absolute or situational. This is far from saying that regulation 30 creates an absolute offence. For that purpose, one has to examine the words of regulation 30 as applicable to the actual offender who is not the licensee. 79. If regulation 30(b) creates an absolute offence, the actual offender who commits the breach of the condition is absolutely liable. 80. In that case, if the actual offender happens to be an employee of the licensee and operates the licensed establishment beyond permitted hours, he will be guilty of an offence with or without menu rea. This would be so even if he made a reasonable and honest mistake of fact or was tricked into so doing. Once that is so, likewise, his employer licensee would also be guilty because of the provisions in section 8 of the ordinance. On the other hand, if regulation 30 toes not create an absolute offence, mens rep on the part of the actual offender is required to be proved. If the employee n a breach of the condition without guilty knowledge - e.g. by an honest mistake of fact or because others trick him committing, this breach - then he commits no offence. Likewise, the licensee who happens to be absent also no offence because there is no offence or no mens rea to be imputed to him, the licensee. I hope, by the aforesaid, I have explained sufficiently clearly how irrelevant it is to argue that regulation 30 creates an circumstances commit an offence without mens lea. Nor is it helpful to argue that liability of the absentee licensee depends on the degree of delegation. Either he delegated or he did not. This is a question of fact. If he did, the provisions in section 8 will take effect and operate to fix him with liability. If he did not, there is no proof of any master/principal and servant/agent relationship, he will be clearly not liable as the 1st appellant is not liable in the present case. 81. Basically, the question is whether regulation 30 creates an absolute offence depends on its own language as showing the intention of the Legislature and nothing else. The first limb of the argument advanced by counsel for thy Crown merely begs the question. 82. It is a well-known principle for construction of statues that, when the language of any statutory provision is plain and unambiguous, the intention of the Legislature must be enforced, however harsh and difficult it is to comply with the part of the citizen who is affected by such provision. If absolute liability is imposed, so be it. Our function is only to administer the law. When the language of a statutory provision however is silent or ambiguous as whether the liability is absolute, the normal presumption is that rea in presumed to be required to be proved. In this respect, there is yet another cardinal principle of construction which is to look at the plain language of the particular statutory provision without any addition, alteration, adulteration or speculation. 83. Part of regulation 30 which bears repeating provides that "Every person holding a licence under Part shall observe the conditions, namely no massage or other treatment shall be given except between the hours of 8 a.m. and 8 p.m." Bearing the provisions of section 8 of the principal ordinance in mind, it means that the licensee, his servants and agents of a licensed establishment is under the same duty to observe such condition. In this connection, I observe the word "shall" exacts a mandatory duty. The question still remains whether the provisions of regulation 30 necessarily mean that such licensee, servant or agent is under a duty whether knowingly or not to observe the condition therein. In my opinion, the answer is 'no' unless by considering other factors which offers a guide to the construction of such statutory provision indicate such a duty. 84. Crown Counsel, in support of his argument to the affirmative by citing the provisions of section 59 of the Licencing Act 1964 which provides as follows:
It is of interest to observe that there are material differences between the provisions of section 59 of the Licencing Act and the provisions of regulation 30 of the Miscellaneous Licences Regulations.
85. What then is the social evil which the Legislature, intends to prevent by the enactment of regulation 30 By the provisions it is obvious that the Legislature does not want massage establishments to be operated in excessive hours or any evil that is commonly associated with nocturnal activities. Without broaching the question of the moral desirability of stopping all massage establishments from operating beyond 8 p.m. any day, we then have to look at the difficulty of enforcing such provisions. I cannot forsee any difficulty in enforcing such provisions. It can be done by simple check-up from time to time. 86. As in the instant case, a visit by the law enforcement agents to the club to finds out whether it operates before or after 8 p.m. can readily be carried out. When masseuses or persons who are massaging customers at any time after 8 p .m. can readily be detected. Nor can any person actually working in the massage establishments deny that he is working after 8 p.m. if they are caught doing so. Apart from the defence of an honest mistake or some other unforseen factors which must be few, I cannot forsee how persons actually operating massage establishments can plead the lack of guilty knowledge. 87. It is then argued that it would be difficult to fix the licensee of that establishment with any offence. But then, any break in the chain of evidence as to guilty knowledge has been bridged by section 8 of the ordinance by imputing guilty knowledge on the part of the employees to that of the licensee. 88. The penalty prescribed for such offence is punishable on summary conviction with the fine of $50,000 or to imprisonment for 6 months. That is severe enough for the purpose of preventing the sort of evil that is envisaged by regulation 30. In view of these, I am not satisfied that it is the intention of Legislature by the words in regulation 30 to create an absolute offence with absolute liability even on the part of the actual offenders. 89. There is yet another argument to the contrary. In the court below, Crown Counsel conceded that for an offence to be committed against regulation 32 of the same set of regulations, it was necessary to prove mens rea because regulation 32 incorporated the word "allow". Before us, Mr. Lyons wants to withdraw that concession. In order to justify this withdrawal and to explain a way the effect of the word 'allow", he resorts to the distinction between a complete delegation and partial delegation on the part of the licensee. Such distinction is, in my opinion, irrelevant and illogical in view of the provisions in section 8 of the ordinance. 90. In the case of Wong Kwong-wah v. The Queen(1), it was held that section 23 of the Pharmacy and Poisons Ordinance does not provide an absolute offence despite the words as follows:
It was so held by another division of this court after a careful examination of the cases of TAI Muk-kwai v. The Queen(2) , R. v. Fernandez(3) , Brian Lloyd Wright (4) , Ashton-Rickhardt (5) and Sweet v. Parsley(6). Perhaps the following passage in Lord Reid's dissenting judgment in Warner's Case(7) at page 278 bears repeating. He said:
Following the reasoning of Lord Reid as set out above, I have my doubt whether it was the intention of our Legislature to impose absolute liability on the person who might otherwise have a reasonable defence. This is particularly so in Hong Kong where people normally attach something sinister to massage establishments even though they are conducted in a proper manner. 91. Lastly, when one compares the social evil caused by dangerous drugs and the difficulty of proving guilty knowledge in relation to possession or possession for the purposes of unlawful trafficking dangerous drug with the evil of operating a massage establishment beyond permitted hours, it is difficult to imagine that the latter is greater. In my opinion, there is no comparison at all. The evil of the former is infinitely greater than the latter. However, by provisions of the Dangerous Drugs Ordinance, the Legislature see fit to provide for a presumption as to guilty knowledge which is rebuttable. I cannot imagine that it is the intention of the Legislature to prevent a much lesser evil by creating an absolute offence which cannot be rebutted by whatever reasonable evidence. 92. For the aforesaid reasons, I am of the opinion that regulation 30 does not, save in the single instance indicated, create an absolute offence and that proof of mens rea is necessary.
Jones J.: 93. Upon the evidence alone I agree that the appeals of all the appellants should be allowed, the convictions quashed and the sentences set aside. I only wish to add a few comments on the issue as to whether Regulation 30(b) of the Miscellaneous Licences Regulations Cap. 114 is an offence of strict liability.
94. In deciding whether an offence is one of strict liability or one that requires mens rea the main factors to be considered are:
95. The penalty for a breach of Regulation 30(b) is a fine of $10,000 and imprisonment for 6 months. 96. Following their conviction before the magistrate the Counsel who then represented the appellants submitted in mitigation that the regulations were directed to prevent sleazy establishments. I believe he was right. 97. No doubt the premises were raided because the police suspected that apart from legitimate massage, services of an immoral nature were also being given to the customers. However, there was no evidence to support this contention. 98. The magistrate did not view the breaches tote of a serious nature for he imposed moderate fines and hoped that the licence would not be revoked. 99. I do not consider that the mere massaging of a male by a female outside the permitted hours can be regarded other than as a very trivial matter. I believe the ordinary man in the street would find it repugnant that a term of imprisonment of up to six months could be imposed for this offence if the licensee through no fault of his own had no knowledge of the facts. It would lead to an unjust result. 100. Mr. Lyons who appeared for the Crown said that no case in Hong Kong had resulted in a sentence of imprisonment being imposed and submitted that such a result was most unlikely. 101. However, this approach has been expressly disapproved by the Courts on many occasions, particularly by lord Reid in R. v. Warner (1a) at page 278 where he said:-
102. Mr. Lyons placed great reliance upon Section 59 of the Licensing Act 1964 which is an offence of strict liability. However, it is significant to observe that the maximum penalty that can be imposed under that section is a fine not exceeding one hundred pounds: 103. It is not inappropriate to draw an analogy between Regulation 30(b) and Regulation 22(b) of the Miscellaneous Licences Regulations which provides that the holder of an auctioneer's licence is required to observe the same permitted hours as the holder of a massage establishment licence viz that no auction shall take place except between the hours of 8 a.m. and 8 p.m. Regulation 22(b) carries the same penalties as Regulation 30(b). 104. I do not consider that difficulty should be encountered in enforcing the regulations. There is merit in Mr. O'Reilly Mayne's suggestion that the police could assist their investigations by taking advantage of Regulations 26 and 28. 105. Regulation 26 prohibits a licensee from employing in the premises any person other than assistants approved by the licensing authority whilst Regulation 28 requires a written return to be made by the licensee on the first day of each month to the licensing authority setting out particulars relating to every person employed at the premises. 106. When this legislation is compared with the Dangerous Drugs Ordinance which incorporates presumptions as to guilty knowledge which are rebuttable for such serious offences as manufacturing dangerous drugs or possession of dangerous drugs for unlawful trafficking it is inconceivable that the legislature intended the present offence to be one of strict liability: 107. I am of the opinion that Regulation 30(b) is not absolute and therefore requires mens rea.
(1) Criminal Appeal 252/80 (1a) (1969) 2 A.C. 256 (2) Criminal Appeal 655/80 (3) Criminal Appeal 193/81 (4a) (1970) A.C. page 132 (4) (1970) A.C. page 132 at page 148 (5) (1963) A.C. 160 (6) (1910) 2.K.B. 471 (7) L. R. 13.Q,B.D. 207 (8) (1970) Crim.L.R. 28 (10) (1946) 1 K.B. 209 (11) (1924) 88 J.P. JO. 446.G (12) (1906) 1 K.B. 357 (13) (1896) 1 Q.B. 655 (14) (No. 2) (1898) 2 Q.B. 306 (15) (1897) 1 Q.B. 396 (16) (1929) 1 K.B. 95 (17) (1918) J.C. 41 (18) (1979) Crim.L.R. 114 (19) (1962) 2 A.C. 256 (20) (1902) 2 K.B. 1 (21) (1954) Crim.L.R. 545 Representation: Mr. D. O'Reilly Mayne, Q.C., and Miss M. Tam (C.P. Tsang & Co.) for all Appellants. Mr. D. Lyons, Crown Counsel, for Respondent. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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