Leung Chun Wa v. The Queen

CACC000415/1973

IN THE SUPREME COURT OF HONG KONG

(APPELLATE JURISDICTION)

CRIMINAL APPEAL NO. 415 OF 1973

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Coram: Pickering, J.

Date of Judgment: 28th June, 1973.

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JUDGMENT

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1. The appellant faced three charges under s.3(2) of the Merchandise Marks Ordinance, Cap. 41. The first charge alleged that he had in his possession, for the purpose of trade, 26 watches bearing the forged trade mark "Rolex", such watches not having been manufactured by or with the assent of the Rolex Company of Switzerland; the second charge alleged possession, for the purposes of manufacture, of goods to which a forged trade mark, namely, "Rolex", had been applied, those goods being 87 watch case backs marked "18K", 6 other watch case backs, 4 watch dials, 30 trade mark symbols, 33 sheets of stickers, 2 broken watch bracelets and one watch case with a bracelet bearing the trade mark of Rolex; the third charge alleged possession, for the purpose of manufacture, of 34 watch cases, without backs, falsely described as being of 18K gold whereas in fact the cases contain less than 18 carats of gold.

2. The facts of the case came to light when police officers, accompanied by representatives of Rolex (H.K.) Limited, executed a search warrant at the appellant's workshop at Flat D, No.13-15 Tai Po Road, 2nd floor in the appellant's absence. The 26 spurious Rolex watches, the subject of the first charge were said by a representative of Rolex (H.K.) Limited to be imitations of Rolex watch Model 1601, the price of which model is $1,570 each whilst the case backs marked 18K could have been used in the manufacture of watches imitating the Rolex Date-Day watch which sells at $3,725 per watch. The gold content of the cases marked 18K was found by the Government Chemist to range in fact from 1.4K to 14.24K. On the day following the search of his premises the appellant surrendered himself to the police and thereafter admitted under caution that he had made the spurious watches for sale but had been unable to find any buyers.

3. In Court the appellant pleaded guilty to the three charges and, in mitigation, said that his parents were dependent upon him and that he intended to get married on the following Sunday. The learned magistrate, describing the offences as deliberate and requiring careful and skilful preparation, sentenced the appellant to 18 months imprisonment concurrently upon each of the three charges.

4. An application for review, heard on the day after the trial, was refused but, upon certain conditions, the appellant was admitted to bail pending appeal in order that his marriage could take place as planned.

5. In dismissing the application for a review of sentence, the learned magistrate, who had already observed when originally passing sentence, that nothing in Hong Kong was safe from the counterfeiter and that even share certificates had come into this sphere of deliberate, calculated crime, added that he had issued numerous search warrants concerning counterfeit biscuits, counterfeit chocolates, counterfeit share certificates and "of course" counterfeit Rolex and Omega watches. He went on to describe these offences as a stab at the vitals of the watch trade of Hong Kong, leading to mass deception of the numerous purchasers in the Middle East and Africa "according to representatives of the Swiss watch trade."

6. Mr. Martin Lee, who represented the appellant upon the appeal, submitted that it was very much to the appellant's credit that he had surrendered to the police upon the day after the search of his premises in his absence; in addition, he had pleaded guilty; and there was no evidence before the court as to any "mass deception of the numerous purchasers in the Middle East and Africa"; moreover the learned magistrate had spoken of his experience of issuing search warrants concerning various counterfeit products but the issue of a warrant was one thing and subsequent conviction was another and the learned magistrate ought not to have placed importance upon the mere fact that applications to him for the issue of search warrants indicated that in various cases the police had suspicion of possession of counterfeit goods for the purpose of manufacture or trade.

7. Further, Mr. Lee urged, in his Statement of Findings, the learned magistrate had observed that his brother magistrate, Corfe, had during the previous month, imposed a sentence of 12 months imprisonment upon a person convicted of possession of spurious Omega watches and had at that time voiced a warning that in future he would take a more serious view of such offences. That sentence and warning, counsel pointed out, were irrelevant since the sentence had been imposed and the warning uttered at a time when the appellant in this case had already been arrested. Furthermore, in the case before the magistrate, Mr. Paul Corfe, the quantity of Omega and Seiko watches involved was no less than 120 dozen and, although the accused in that case had been sentenced by the learned magistrate to 12 months imprisonment on each of the six charges, those sentences to run concurrently, upon appeal, Cons, J. had set aside the sentence of imprisonment and substituted a fine of $3,000 upon each of the six charges with an alternative of one month's imprisonment upon each charge if the fines were not paid, such terms of imprisonment to be, in default of payment, consecutive. In so doing, counsel added, Cons, J. had said that fines were the usual form of sentence for offences of this type and inquiries which counsel had made from two of his colleagues at the Bar, suggested that the normal range of fine lay between $1,000 and $4,000 in respect of any particular charge of this type.

8. It does appear that in his reference to "mass deception of the numerous purchasers in the Middle East and Africa", the learned magistrate went further than the evidence warranted and that he equated applications made to him for search warrants, in regard to allegedly counterfeit goods, with the guilt of the persons against whom those warrants were sought. In this latter regard he mentally jumped a stage, to the detriment of the appellant. Moreover the sentence of imprisonment imposed by his learned brother Corfe and the warning which accompanied that sentence, were, as Mr. Lee pointed out, irrelevant by virtue of the fact they came about only after the arrest of the appellant.

9. Thus the learned magistrate approached the task of sentencing the appellant with some indignation, perhaps not wholly undeserved, about offences of this type. That indignation was however, stoked by considerations which were not strictly germane to the case before him.

10. It is with these considerations in mind, and whilst I am far from saying that a prison sentence may not be well merited in this type of case, that I have come to the conclusion that this is not the appropriate case in which to start to make an example of some offender by way of a sentence of imprisonment.

11. As to what sentence is appropriate, I have endeavoured to check the accuracy of the information supplied to Mr. Lee by two of his colleagues at the Bar. That information was to the effect that the normal range of fine in this type of case lies between $1,000 and $4,000. Statistics which have kindly been supplied to me from various magistracies suggest that the range $1,000 to $3,000 is not untypical - and, since this type of case continues to come before the courts with some frequency, it may be that that range is inadequate to constitute an effective deterrent. That range is not inviolable however and during the last twelve months there have been several instances of fines of $8,000 and $25,000 and at least one each of $10,000 and $40,000. Going back a little further in time, in April of 1972 the Full Court, in Criminal Appeal No. 889 of 1971, refused to interfere with a fine of $25,000 in this same type of case.

12. In the present case, whilst the quantity of goods was not very large, yet it was a prestigious name and a prestigious carat marking which the appellant appropriated. We are concerned here not with ties, shirts or shoes but with watches which, had the appellant found a market for them, could have been expected to have sold for high prices. Balancing the relatively small amount of goods involved against the high prices which they might well have fetched, I consider a fine of $4,000 upon each charge to be appropriate. In default of payment the appellant must go to prison for 2 months upon each charge, consecutively. The appeal against the three concurrent sentences of eighteen months imprisonment is allowed, to that extent. On his counsel's request, the appellant is allowed three days to pay.

Representation:

Martin Lee (Bernard Wong & Co.) for appellant

Niamatullah, C.C., for respondent.