Ho Shing-tuen v. The Queen

CACC000005/1979

Criminal prosecution under s. 10(1)(b) of Prevention of Bribery Ordinance - assets held by wife - wife having no income of her own - closeness of relationship and "other circumstances" justified conclusion that presumption of control by accused arose under s. 10(2).

Sentence - order under s. 12(3) - that subsection not enacted until after charge date - s. 92 of Interpretation and General Clauses Ordinance - order was a "penalty" - offence complete at charge date and not at date of trial, when accused failed to give satisfactory explanation - order made without jurisdiction.

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Coram: Huggins, J.A., Cons and Yang, JJ.

Date of Judgment: 3 March 1980

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JUDGMENT

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Huggins, J.A.:

1. On the application for leave to appeal against conviction Mr. Lee has raised what is in truth a short point, whether a presumption arose against the Appellant. The Appellant had been charged under s. 10(1)(b) of the Prevention of Bribery Ordinance with being a Crown servant who was in control of pecuniary resources and property disproportionate to his official emoluments. The charge date was 13th April 1972.

2. The case for the Crown at the trial was that the wife of the Appellant was clearly in control of the vast majority of the assets and that she was controlling them for and on behalf of the Appellant. Subsection (2), on which the prosecution relied as the foundation of the second of those propositions, reads:

"Where a court is satisfied in proceedings for an offence under subsection (1)(b) that, having regard to the closeness of his relationship to the accused and to other circumstances, there is reason to believe that any person was holding pecuniary resources or property in trust for or otherwise on behalf of the accused or acquired such resources or property as a gift from the accused, such resources or property as a gift from the accused, such resources or property shall, until the contrary is proved, be presumed to have been in the control of the accused."

It is now conceded that these assets were in the control of the wife, but it is contended that there was no evidence to justify the conclusion that she was the Appellant's agent. The argument is stated in the alternative thus, that although the closeness of the relationship had been established there were no "other circumstances" giving reason to believe that the assets were acquired from or on behalf of the Appellant. The judge found the wife to be "the linchpin and conduit for the dispersion of the Defendant's resources".

3. We think it is accepted that mere closeness of relationship alone is not sufficient to bring the presumption of control into play: one must have "regard to the closeness of [the] relationship to the accused and to other circumstances" (emphasis supplied). We must therefore accept that the mere fact that assets are vested in the Appellant's wife does not give sufficient reason to believe that she is his trustee or agent. Equally the "other circumstances" need not of themselves give such reason to believe: it is the combination of relationship and other circumstances which must do so. The question in each case is whether that combination produces not merely suspicion but reason to believe.

4. One of the other circumstances suggested here is that during the period when the wife obtained her resources and property she had no income of her own and yet at the charge date she had two properties registered in her own name and over $90,000 in the bank. We take it that what is suggested is that, in the absence of any explanation as to how she acquired these assets, it is to be assumed that she acquired them from or on behalf of her husband, the Appellant, rather than from anybody else, since they were living together and there was no reason to think that their relationship was otherwise than close in fact. On one view that is a circular argument, for by implication it requires the Appellant to indicate how his wife could have acquired the assets otherwise than through or for him, whereas that is substantially what it is sought, by means of the presumption, to require him to do. On the other hand it can be said that to require the Appellant to indicate how his wife could have acquired the assets is not the same thing as requiring him to explain how she did in fact acquire them. Such a distinction would favour, for example, a defendant whose wife belonged to a wealthy family, for all he would have to do would be to point to her family as a not improbable source of her assets, whilst a defendant like the present Appellant, whose wife has no apparent source of income, would probably have to show what was the actual source of the assets in order to avoid the presumption. Nevertheless what would be merely a possible ground for suspicion in the one case might well give sufficient reason for belief in the other. The learned trial judge carefully listed the matters on which he relied as satisfying him that there was "reason to believe" in the present case. Another important one was that in his opinion the Appellant had attempted to mislead investigating officers of the Independent Commission Against Corruption in respect of a U.S. -dollar bank account operated in his wife's name. We cannot say that he was wrong.

5. It remains, therefore, to consider the application for leave to appeal against sentence. The trial judge thought a sentence of two years' imprisonment to be appropriate and that is not challenged. However, in addition to that penalty he made an order under s. 12(3) and it is submitted that that order was made without jurisdiction. The basis of the contention is that, whereas the charge date was 13th April 1972, s. 12(3) did not become law until 1974 and that s. 92 of the Interpretation and General Clauses Ordinance provides:

"Where an act or omission constitutes an offence and the penalty for such offence is varied between the time of the commission of such offence and the conviction therefor, the offender shall be liable to the penalty prescribed at the time of the commission of the offence."

The judge held that the order was part of the "penalty" within the meaning of that section but took the view that, although the charge date was prior to the enactment of s. 12(3), the offence under s. 10 was not committed until the Appellant failed at his trial to give a satisfactory explanation. The judge's reasoning appears to have been that s. 92 of the Interpretation and General Clauses Ordinance contemplated that an offence would be constituted either by an act or by an omission, not by both, and he concluded that, as here the offence was constituted both by an act and by an omission, both the act and the omission must have occurred before the variation of the penalty if the limitation imposed by s. 92 was to take effect.

6. The first question is whether the order under s. 12(3) was a "penalty". Looked at from the point of view of the convicted person there can be no doubt but that it was a penalty: unless he was a lawyer he would see no distinction between an order to pay money with nothing in return and an ordinary fine. The judge thought that the Legislature had not created what he called a "non penalty", and he accepted that "the whole tenor of this section is to deprive a convicted person of the assets he has gained". We think that is right and that it is not inconsistent with what this court said in Cheung Chee-kwong v Reg. 1978 H.K.L.R. 110, 119, where we were not concerned with s. 92 of the Interpretation and General Clauses Ordinance but with the valuation of the property. When we said in that context that such an order was "akin to an order for compensation" we were looking at the matter from the point of view of the Crown. Compensation and deprivation are often on opposite sides of the same coin. Compensation can only be based upon the fact of corruption. If that can be shown, compensation can be recovered by action quite apart from s. 12(3), but prosecutions under s. 10 will usually be brought only where actual corruption cannot be proved. We do not think, therefore, that any question of compensation can have been contemplated: the intention was to deprive the convicted person, not to compensate the Crown.

7. The second question is whether s. 12(3) varied the penalty for an offence under s. 10 before, or after, "the act or omission" which constituted this particular offence.

Whilst it is true that there could be no conviction until the Appellant failed to explain his assets, it seems to us that that failure was not an omission in part constituting the offence. If the Appellant had been tried before 1974, the only penalties which could have been imposed were those under s. 12(1). The act or acts which were the real basis of complaint crystallised into an offence on the charge date and the Appellant could have been charged on that or any subsequent date. If it had been the intention of the Legislature to make s. 12(3) applicable to a defendant who could have been charged before the date on which the amending statute came into force, we think this would have been made clear beyond doubt. The failure to explain was not "an act or omission" within the contemplation of s. 92 of the Interpretation and General Clauses Ordinance. The act constituting his offence was the possession on the charge date of assets for which he would not, when called upon, be able to give a satisfactory explanation. A satisfactory explanation would have given that prima facie criminal act an innocent character.

8. In the result the application for leave to appeal against conviction is dismissed, but the appeal against sentence is allowed to the extent that the order under s. 12(3) is quashed.

3rd March 1980.

Representation:

M. Lee, Q.C. & W. Chan (T. s. Tong & Co.) for Appellant.

T. Gall for Crown/Respondent.