The Queen v. Chan Kin Man

IN THE COURT OF APPEAL

1986, No. 367
(Criminal)

BETWEEN

__________________

Coram : Roberts, C.J., Silke, J.A. & Power, J.

Date of Hearing : 26^th March 1987

Date of Judgment :  26^th March 1987

__________________

J U D G M E N T

___________________

Silke, J.A. :

1. The Applicant, Chan Kin Man, faced trial in the District Court on a ten-count Charge Sheet. He pleaded guilty to the 6th, 9^th and 10th counts. Each of them were laid under section 18B(1)(b) of the Theft Ordinance - evasion of liability by deception. The remaining seven counts were left on the file.

2. He pleaded guilty and was sentenced to six months on counts 6 and 9 and 3^1/2 years on count 10, all concurrent. He now seeks leave to appeal against those sentences.

3. The Applicant had commenced business under the name of GaIly Trading Company - a general trading company in November of 1985. Bank accounts were opened but no overdrafts were arranged with either of the banks concerned.

4. The individual counts related to bounced cheques.

5. The 6th charge: On the 4th February l986, pots of tangerines were bought, the total price was $46,310. There was an attempt to pay by cheque but this was refused  by the sellers who said that cash payment was the arrangement. Eventually they were induced by the Applicant to accept a cheque which was later dishonoured.

6. The 9^th count: On the 21^st January 1986, 6,000 ties were boughtto thevalue of $36,000.  The purchase price was to be settled within seven days of delivery.  The ties were delivered on the 24^th January and, payment not having been made by the 30^th, the Applicant was contacted and a cheque was promised by him. On the following day, a postdated cheque was given.  Subsequently that was withdrawn and another cheque was given in its place. That cheque bounced.

7. The 10^th, and the most serious of the counts:  The Applicant on the 10^th December 1985 discussed the sale and purchase of 50 metric tons of ramie.  Dates and prices for shipment were agreed. Payment was to be by means of a 14-day postdated cheque.  On the 12^th December, part delivery of the goods ordered was made to the Applicant’s godown in Cheung Sha Wan.  At the time of this delivery further goods were ordered. Two cheques, one to the value of $615,825.60 and one to the value of $526,281.60 were given.

8. On the 16^th December, a second lot of goods was delivered to Gally’s godown. There then arose the possibility of payment by a local letter of credit rather than postdated cheques.  This came to nought and, on the 7^th January 1986, a cheque in the total sum of $2,232,531.60, which sum included the amounts of the two prior cheques, was given.  Again, this cheque bounced and no payment has ever been made upon it.

9. The Applicant is a man of 26.  We are told that he started up his firm having had no prior business experience.  In the course of mitigation in the Court below,it had been suggested that certain cheques, which had been drawn in his favour, had bounced.  These cheques were not produced.  The sentencing judge took not of the submission.

10. We have been referred by both Mr. Smith, who appears for the Applicant in this Court, and Mr. Sulan, for the Crown, to a series of cases concerning commercial fraud.  As to these, if I may be permitted to quote what I said when delivering the judgment of the Court in Kwan Ka Hung⁽¹⁾ :

“The sentence in each case of this nature must depend very much upon the individual facts and I, for one, would hesitate to lay down any hard and fast guidelines as to the sentence to be imposed. “

11. The cases that have been referred to us have, of course, a certain similarity but they are not on all fours either one with the other or with this particular case. In the light of the submissions, the agreed evidence and the manner in which the matter was presented in the Court below, we are treating the Applicant as a businessman who went wrong rather than as a businessman who deliberately set up a false firm for the purpose of defrauding his suppliers. In this commercial city, suppliers are entitled to protection.

12. While we are prepared to take the view most favourable to the Applicant, we would have thought that the matters which were somewhat cursorily advanced in the Court below in relation to the cheques, a bank statement showing bounced cheques and what had happened to the goods would have been further elaborated upon. Had we taken the view that this was a firm set up for deliberate fraud, then it would have been unlikely that three and half years, or even more, would have been interfered with.

13. In the light of the views we have formed of this matter, we think that the trial judge took too high, a starting point. We are conscious of the fact that this firm came into being in November 1985 and that all these matters arose very shortly thereafter culminating the visit by Commercial Crime Bureau to the firm's premises in February 1986.

14. But that having been said, we think here that the overall criminality of the Applicant, bearing in mind his persona1 particulars, his plea and the submissions made, would be reflected, by a sentence of two and a half years' imprisonment.  Therefore, the application is granted, the appeal allowed and the sentence of three and a half years on count 10 is set aside and replaced by a sentence of two and a half years. The sentences on counts 6 and 9 will not be altered. The sentences are to run concurrently.

Christopher Smith, Esq. (D. L. A.) for Applicant.

John Sulan, Esq. for Crown/Respondent.

(1) Criminal Appeal No. 501 of 1984 (unreported)