Shishir Kothari t/a Ko Jewels Trading Co v. Gilman & Co Ltd

HCA001915/1970

(ORIGINAL JURISDICTION)

ACTION NO. 1915 OF 1970

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Coram: Pickering, J.

Date of Judgment: 22nd October, 1971.

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JUDGMENT

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1. The plaintiff is a jeweller carrying on business from his residence at 78 Morrison Hill Road, 11th floor, Flat E, whilst the defendant company is (inter alia) an insurance agent. The defendant company insured the plaintiff against loss by theft of diamonds, precious stones, pearls, jewellery, gems, ornaments, semi-precious stones, jades, and the like, the property of the plaintiff or for which he might be responsible, whilst contained in the plaintiff's aforesaid premises; the amount of the insurance was $200,000 and its duration from the 18th of July, 1970 to the 17th of July, 1971.

2. It is the plaintiff's case that on the 15th August, 1970, two men entered his premises under the guise of dealers and, after he had opened his safe to display stock to them, struggled with him at knife point, and bound and gagged him and thrust him into a bathroom, subsequently making away with diamonds and jewellery, itemized in the Amended Statement of Claim, to the value of $342,515.96.

3. The defendants, though not denying the existence or validity of the cover note, have not paid the plaintiff the sum of $200,000 or any sum of money; it is their defence that the diamonds and jewellery particularised in the Amended Statement of Claim were not in the plaintiff's premises at the time of the alleged robbery or, alternatively, that if they were so there, they were not stolen. Whilst the Statement of Defence does not employ the word 'fraud' and certainly does not particularised fraud, the whole tenor of the defence is an innuendo that the plaintiff's claim is spurious and the robbery a bogus one. I will say at once that I am unable to find any evidence of fraud.

4. The plaintiff gave evidence that during the morning of the 15th of August, 1970, he received a telephone call from a girl at Cecil Arts, a firm of jewellers with whom he had dealings. The call was to the effect that two buyers from Taiwan wished to see the plaintiff's stock with a view to making purchases, and it was the plaintiff's evidence that this was the third occasion upon which Cecil Arts had so introduced buyers to him. He further stated that, having been in Kowloon on the day in question, he returned to his premises at approximately 4.55 in the afternoon, his appointment with the Taiwan buyers being expressed to be between 5 and 5:20; at that time the only person in the premises was the plaintiff's cook-boy, an Indian youth of about 17 years. Having entered his flat the plaintiff went to the bathroom from where he heard the cook-boy shout to him that he was going out to buy vegetables; a few minutes after the plaintiff had emerged from the bathroom, the front door bell rang and, through the peep-hole in the door, he saw two well-dressed men whom he presumed to be the buyers. The plaintiff let them into the flat and noticed that each carried a black, hard-cover briefcase of the type which has come to be known as a 'James Bond' briefcase. Having seated the two in the sitting room, the plaintiff asked for their cards but was told that neither had his card with him; the plaintiff thereupon accompanied the two into his office where he placed three leather pouches, containing jewels, upon the table and took certain other goods, contained in raxine boxes, from the top portion of his safe similarly placing these boxes on the table.

5. The plaintiff is an Indian and speaks very little Cantonese whereas only one of his visitors spoke English and it was this man who asked if the two could have some tea; the plaintiff's reply was that his servant would be back in ten or fifteen minutes, but the visitor was insistent that they should have at any rate a glass of water. The plaintiff then went into the kitchen to the refrigerator, and whilst pouring water from a bottle into a glass in the kitchen, felt his neck seized by an arm whereupon he dropped the bottle (the broken glass was found in the kitchen by the police), and managed to escape from the grip around his neck; there followed a short struggle, culminating in the plaintiff running back into the office with the intention of telephoning the police from a telephone on the office table; the telephone was, however, snatched from his hand and left dangling on its cord. At this stage the taller of the two men drew out a knife from his pocket and started, in the words of the plaintiff, to swing it. There was a further struggle during which the knife came into contact a number of times with the plaintiff's left shoulder and the upper part of his left chest. In parenthesis, the plaintiff was found to have superficial scratches on his arm and chest, which the doctor who examined him, said could not have been caused by his own finger-nails. The smaller man, the plaintiff claims, pushed him from behind so that he was propelled into the grip of the taller, who kept the knife near the plaintiff's throat and said that if the plaintiff did not surrender, or if he should scream or shout, he would have to be killed. The plaintiff, being very frightened, abandoned the struggle whereupon the two tied him up with cord similar to that used in Venetian blinds, and also with cloth, his hands and feet being tied behind him and a gag of cloth being placed around his mouth. The plaintiff's evidence was that he did not see from where the cloth and cord were produced but first saw these items in the hands of the smaller man and assumed that the two had been carrying them in their briefcases. Having tied the plaintiff up, the two men dumped him in a bathroom leading off the office and closed the door upon him.

6. After some fifteen to twenty minutes a Mr. William LI, a young man in the employment of the plaintiff in his jewellery business, opened the door and came into the bathroom. Mr. Li being unable to untie the plaintiff's bindings, left the bathroom for a few seconds and returned with a knife with which he released the gag, thereupon immediately returning to the office and telephoning the police. After this, Mr. Li returned to the bathroom and cut away the rest of the cord and cloth from around the plaintiff's body, wrists and ankles.

7. Mr. William LI, who is now in Canada, gave evidence de bene esse and said that on arriving at the flat shortly after 5.15 p.m. having been engaged upon outside duties for his employer, he rang the bell but received no answer; upon trying the door knob he found that the door was not locked. The door knob was described to me in evidence as being of exactly the same type as that on the door of the barristers' conference room in the Supreme Court building; I have examined that knob and it is clear that a door so equipped can be locked only from the inside. Mr. Li said that he found the furniture in disarray, some chairs being displaced and others overturned, but he was not, at this time, suspicious and his first task was to rearrange the furniture after which he went into the office where, observing the safe to be open, he realized that something was wrong. He eventually found the plaintiff in the bathroom, tied in the manner the plaintiff later described in evidence, and lying on the floor on his side. His evidence as to releasing the plaintiff corroborated the plaintiff's own evidence. Mr. Li described the plaintiff's bonds as tightly tied and expressed the view, for what such opinion evidence is worth, that the plaintiff could not have so tied himself up, the more so since the knots were at his back.

8. A considerable amount of cross-examination of the plaintiff was devoted to his books of account and bank accounts in an attempt to demonstrate that his business was not a wholly genuine business and that he had never had the means to buy the amount of stock of which he claimed to have been robbed.

9. For the plaintiff, various jewellers with whom he had dealings in the Colony, were called to testify as to these dealings, and the net result of their evidence and of the explanations, given with considerable dignity, by the plaintiff, to apparent anomalies in his accounts and bank statements, is to convince me that he was carrying on a genuine business and that his credit was good in the trade in the Colony. I do not suggest that every discrepancy was explained, but when the books of a one-man trader are raked through with a fine tooth-comb, as they were by Mr. Zimmern for the defendant company in this case, it is not, in my view, surprising that some mistakes can be demonstrated. As I have stated, however, the overall impression with which I am left is that of a genuine business conducted on orthodox lines according to trade customs and usages. Moreover I am fully satisfied, on the basis of the plaintiff's books of account and of his verbal explanation of the receipt, from time to time, of remittances in U.S. dollars from his business interests in Beirut, that he had sufficient funds to have purchased, and did in fact purchase - as largely corroborated by his suppliers in evidence - the goods which he claims were stolen.

10. During the period from October, 1969 to the date of the robbery on the 15th August, 1970, some dozen or so cheques issued by the plaintiff were dishonoured and it was suggested for the defendants that a man with ample resources held in cash (which was the plaintiff's evidence) would be unlikely to operate his bank account at a level which failed to forestall the dishonour of cheques. The plaintiff's explanation for most of the dishonoured cheques was that his account with the First National City Bank was in Kowloon, whereas his office being on Hong Kong Island, he paid in cash to the account through a branch of the bank on the Island, and his account was not credited with the money paid in for some twenty-four hours, a matter of which he had frequently complained to the bank and which had eventually led to his opening another account with a different bank. It is significant that no cheques drawn upon this new account were ever dishonoured. Whilst it is true that a few of the dozen or so dishonoured cheques were dishonoured for the simple reason that there was no money in the account to meet them, either in Kowloon or on the Island, I am unable to attach the significance to these occurrences which the defence seeks to place upon them.

11. It was further suggested to the plaintiff that his books of account had all been written up at the same time. The plaintiff's own evidence was to the effect that he made up his books every two or three days. No expert evidence in regard to handwriting, ink or paper was produced to support the defence suggestion, and I am satisfied that the books were in fact made up by the plaintiff from time to time as he stated in evidence. Mr. Lam, a certified accountant with M.W. Kwan & Co., said that the plaintiff's Purchase and Sales Book was in very good order and that he had no reason to doubt its genuineness and added that by and large the entries in the bank's statements and the plaintiff's bank book corresponded.

12. The second limb of the defendant company's attack upon the plaintiff's claim was directed to the physical circumstances of the robbery itself. There was evidence from a caretaker at the premises, who said that at about the time of the robbery Mr. William Li complained to him on the ground floor that one of the lifts was not working. On going to the lift and opening the inner door forcibly, the caretaker saw inside the lift the plaintiff's Indian cook boy and was of the opinion that the boy had been pushing against the door in order to prevent its being opened. This boy, he said, had something of a reputation for fooling about with the lifts and with water pipes and on this occasion he asked Mr. Li to mention the boy's behaviour to the plaintiff. The significance which the defence attempted to draw from this meeting of Mr. Li and the cook boy on the ground floor at about the time of the robbery arises from the fact that after the brief meeting the cook boy went out of the building and Mr. Li went up in the lift to the plaintiff's premises on the 11th floor. There would not have been time, it is argued, for the robbery to have taken place in the manner described by the plaintiff, between the cook boy's leaving the flat and Mr. Li's reaching it. In my view, this theory falls to the ground, because there is no evidence whatever of what the cook boy did between leaving the flat on the 11th floor and being found at the lift on the ground floor, nor of what interval of time elapsed between those two events. In addition it was the evidence of Mr. William Li, that following the discovery of the Indian boy in the lift, he, Mr. Li, engaged in conversation with the caretaker for several minutes.

13. It was further the evidence of the caretaker that he had been sitting with the lifts in view for an hour before the time of the robbery and that no well-dressed strangers had used the lifts or the staircase, tenants being the only person to enter the building during that day until the police came. The total unreliability of such evidence from this witness is demonstrated by the fact that although he claims to have been seated in the same place at 5:45 p.m. when Inspector Ferrige arrived, he had no recollection of any European entering the building. I can only describe the evidence of the caretaker as to the presence or absence of two well-dressed strangers, as being worthless.

14. An unexplained contradiction in the evidence relates to the cord with which the plaintiff was bound. It was the evidence of Mr. William LI that after he had cut the cord, some knots remained in it. A police corporal, who arrived at the flat with a party as a result of Mr. William LI's telephone call to the police, testified that nobody touched the cord before Inspector Ferrige's arrival and yet Inspector Ferrige says that when he first saw the cord there were no knots on it. This contradiction has remained unexplained and I can only assume that one party or the other was mistaken in regard to the presence or absence of knots in the cords. The present condition of the cord offers no guidance because later that evening it was used to tie up a CID man in order to check whether or not the plaintiff could have been tied up with that particular cord in the manner which he claimed. The result of this test was to satisfy the police that he could so have been tied.

15. A further matter upon which the defence placed some reliance was the existence of a button with a small piece of cloth adhering to it, said to have been found in a bathroom some distance from the office, the room in which the plaintiff was interviewed until almost midnight by the police. In the course of the struggle with the robbers, the plaintiff's shirt had been either cut or torn or both and, as it appeared in court, various buttons were missing from it. Miss. Hamilton, a Government chemist, testified that the button was of the colour, shape and design of the remaining buttons on the shirt and that her examination of the shirt showed that the cloth adhering to the button fitted perfectly into a tear on the shirt. The significance which the defence sought to attach to this button was that it had been said to have been found in a bathroom which the plaintiff had never visited after the time of the robbery. The evidence as to where the button was found, however, was at best hearsay, and all that Inspector Ferrige could say was that he was led to the button in that particular bathroom by one of his men. Moreover, the find was not made until after the police had been at the premises in some numbers for approximately five hours. It is the plaintiff's contention, and it was his contention on that very night, that the button had been planted in the bathroom by the police and he made a formal complaint to that effect to Inspector Ferrige who recorded it in his notebook. Inspector Ferrige said in evidence that the police had laid various traps for the plaintiff in the course of their questioning him, and whether this button was the subject of one of the traps I do not know. But in the absence of any reliable evidence as to where it was found and in the light of the plaintiff's immediate complaint about the button, I cannot attach any importance to it.

16. Another matter of which the plaintiff complains is that the police produced to him a wallet belonging to his cook boy and containing the plaintiff's pearl tie pin and asked him whether he was aware that his cook boy was stealing from him. The plaintiff was able to give the lie to this allegation immediately because he had worn the tie pin when he was taken to the hospital after the robbery and know exactly where he had placed it down upon his return to the flat and knew also that the cook boy, who had worked for him for some seven or eight years, would, had the allegation been true, have had to have stolen the tie pin from the top of a dressing table at a time when the flat was full of policemen. The plaintiff says that he made a further formal complaint about this matter. Inspector Ferrige had no recollection of that complaint and Superintendent Buchanan, who was also present, was not called to give evidence.

17. The vigorous attack upon the insurance claim made by the defendants must fail both in regard to the allegations made in respect of his finances and general mode of business, and in regard to the physical facts of the robbery. The plaintiff's evidence was very clear and was corroborated in great detail by the evidence of Mr. William LI.

18. I find as facts that (1) the plaintiff was, on the 15th August, 1970, carrying on a genuine wholesale jewellery business at 78, Morrison Hill Road, 11th floor, Flat E; (2) since his arrival in Hong Kong in September, 1969 he was in possession of the means to buy, and had in fact bought, the items of stock of which he was robbed on the 15th August, 1970; (3) on the 15th August, 1970, the plaintiff was robbed of stock to the value of more than $340,000 in the circumstances which he described in evidence.

The existence and validity of the cover note being undisputed, it is for these reasons that I gave judgment for the plaintiff in the amount claimed, with costs.

Representation:

Mills-Owens, Esq. (Messrs. Johnson Stokes & Master) for Plaintiff.

A. Zimmern, Esq. (Messrs. Deacons) for Defendants.