HKSAR v. Jackson-lipkin, Lucille Fung and Another

HCMA 173/2007

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

(APPELLATE JURISDICTION)

MAGISTRACY APPEAL NO 173 OF 2007

(ON APPEAL FROM KCCC 637/2006)

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BETWEEN

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Before:  Saunders J in Court

Date of Hearing:  25 May 2007

Date of Judgment:  25 May 2007

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J U D G M E N T

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1.On 12 January 2007, in Kowloon City Magistracy, both Appellants were convicted by the Chief Magistrate, (as he then was), on three counts:

(i)   fraud contrary to s 16A Theft Ordinance (Cap 210);

(ii)   attempted fraud contrary to s 16A Theft Ordinance and s 159G Crimes Ordinance (Cap 200);

(iii)  knowingly making false statements in an application for a lease contrary to s 26(1)(c) Housing Ordinance (Cap 283).

2.On 26 January 2007, the Appellants were each sentenced to:

(i)  15 months on the charge of fraud;

(ii)  10 months on the charge of attempted fraud;

(iii)  four months on the charge of knowingly making false statements; and

(iv)  each Appellant was ordered to pay compensation in the sum of $50,000 within six months.

The sentences were ordered to be served concurrently, however the Chief Magistrate then ordered that four months should be deducted from the total sentence.  Consequently each Appellant was to serve a term of imprisonment of 11 months.  Having regard to their anticipated entitlement to remission for good behaviour, both Appellants are due for release on 25 August 2007.  The compensation order has been met, and the Appellants have paid a total of $100,000 to the Government pursuant to the order.

3.The Appellants lodged an appeal against both conviction and sentence, but they have now abandoned the appeal against conviction and proceed on the appeal against sentence only.

4.The offences committed by the Appellants related to false representations made by them about their financial status in order that they may obtain Comprehensive Social Security Assistance, (CSSA), financial assistance in purchasing a pair of hearing aids, and obtaining a lease of a public housing unit at Wah Fu Estate.  The total sum involved in the frauds, setting aside any benefit that might be assessed through obtaining public housing when not entitled, amounted to $111,244.

5.In passing sentence the Chief Magistrate correctly recognised that there is no tariff for these types of offences, generally characterised as social welfare fraud.  He reviewed two decisions from this court: HKSAR v Wong Kam Sang HCMA 1156/1999, HKSAR v Chan Ming Kuen HCMA 1244/2000 and one from the Court of Appeal: HKSAR v Ma Kim Hung CACC 33/2002, all on sentencing in social welfare fraud.  In Ma Kim Hung, the Court of Appeal, (para 13), cited the following passage from the judge’s remarks on sentencing, without criticism:

“… one must not lose sight of the fact that the scheme of CSSA is to help people who are genuinely in need of public funds.  The effectiveness of the scheme depends, to a certain extent, on honesty on the part of applicants.  It is clear that the scheme and the system of social security will collapse if subject to abuse by people motivated by greediness, like the defendant in this case.

In my view, a deterrent sentence is called for.  Whilst full restitution is appreciated and encouraged by the courts, such will not spare a defendant from an immediate custodial sentence.  The message is loud and clear: those who deliberately cheat CSSA may expect to face a lengthy custodial sentence and whilst a timely and full restitution can attract some discount, it will not buy a defendant out of a prison sentence that he would otherwise serve.” 

While that passage is primarily directed at the issue of restitution, the Court of Appeal did not at all depart from the sentencing judge’s view as to the reasons for, or the need for a custodial sentence.  Although not specifically saying so in his sentencing remarks, the Chief Magistrate appears to have concluded that the appropriate starting point for this social welfare fraud, by these offenders, involving a significant sum, should be an immediate custodial sentence. 

6.Mr Grossman SC, who has pleaded most eloquently for the Appellants, drew my attention to statements by Bokhary JA, as he then was, in AG v Ng Sai Man [1994] 1 HKCLR 152 at 154 l 40, Lord Lane CJ in A.G’s Reference No 4 of 1989 (1989) 11 Cr App R (S) 517 at 521, and most recently Underhill J in R v Evans [2007] EWCA Crim 1158, all to the effect that a court will usually be very reluctant to send a person to prison.  The decision in Evans emphasises the fact that that reluctance will be all the more so in respect of an elderly person.  That is undoubtedly correct, but I am satisfied that the Chief Magistrate was quite right in determining that an immediate custodial sentence was appropriate for the social welfare fraud, of the magnitude involved in this case, and by these Appellants. 

7.In  Ma Kim Hung the Court of Appeal was told, (para 14), that although the amounts are often small, cases of social welfare fraud are dealt with in the Magistrates Court on a daily basis.  Whilst such frauds involving small amounts of money might be dealt with relatively modestly, where a particular type of fraud is apparently common, such frauds involving larger sums must involve a consideration of an immediate custodial sentence.

8.The money sums involved in the present case cannot be considered modest.  But in this case, in addition to the actual monetary sum, regard must be had to the benefit received by the Appellants in the allocation to them of public housing to which they were not entitled.  Although there has been no attempt to quantify the real value of the public housing benefit gained by the Appellants, it must be significant in a society like Hong Kong where housing is so much in demand and generally very  expensive.

9.I now have the advantage of the decision in Secretary for Justice v Leung Wai Kei [2007] 2 HKLRD 90, a decision made after the Appellants were sentenced, and accordingly not available to the Chief Magistrate. 

10.There, the Court of Appeal noted that social welfare fraud appeared to be increasingly prevalent in Hong Kong, and, without laying down a rule that an immediate custodial sentence would be the norm, held  that severe sentences were warranted in appropriate cases.  The court held that where a custodial sentence was considered appropriate, and where a defendant had not pleaded guilty, the appropriate sentence for a social welfare fraud involving $100,000-$200,000 was 15 to 24 months.

11.In all of the circumstances of this case, as counsel for the Appellants at sentencing noted, an immediate custodial sentence was inevitable.  There, the plea was directed at a suspension of that sentence.

12.Mr Grossman argues that in determining that an immediate custodial sentence was appropriate, insufficient attention was paid by the Chief Magistrate to the age, and ill-health of the Appellants.  The correct approach to the impact of advanced age and ill-health is set out in the decision of McMahon J. in HKSAR v Tam Yuen Tong [2007] 1 HKLRD 894 at 895-6:

“Advanced age, it may fairly be said, is not in principle a mitigating factor but a court is entitled to take it into account where it thinks appropriate, and as an act of mercy use it as a basis for a discount on sentence: R v Chan Tak Sang [1987] HKLR 1203 at 1207.  That is particularly so when advanced age is combined with an unblemished character: R v Bowdler [1975] Crim LR 590.  Ill-health generally will not normally operate as a mitigating factor.  That is because prison medical facilities are regarded as adequate to deal with prisoners’ physical complaints.  As a matter of reality most prisoners receive medical attention in prison of an equal or better standard than they would otherwise receive.  Accordingly the ill-health, with the exception of perhaps very serious ill-health, of an offender will not be a matter taken into account in mitigation: R v Chan Kui Sheung [1996] 3 HKC 279 at 284 and R v Lo Chi Keung [1996] 3 HKC 155.  Again, however, in exceptional circumstances and as an act of mercy rather than as a principle of mitigation, ill-health may result in a reduction of sentence.”

13.I am satisfied that the Chief Magistrate, in determining the starting point to be adopted in this case, has given appropriate weight to these factors.  He correctly dealt with them as an act of mercy.  I accordingly conclude that the sentence imposed by the Chief Magistrate was not manifestly excessive.

14.In an appeal from a magistrate against sentence it is open to the Judge to look at the matter afresh.  I am able to have regard to matters that have occurred since the original sentence was passed.

15.At the time of sentencing letters of support from persons, described by the Chief Magistrate as “respectable friends” of the Appellants, were put before him.  I have had put before me letters, not available to the Chief Magistrate, from the Rt Hon the Baroness Butler-Sloss GBE, and the Rt Hon Lord Justice Thorpe.  Both have known the Appellants for many years, and both speak highly of the Appellants, both recognising the impact that conviction and imprisonment has undoubtedly had on the Appellants.  Both comment upon the extent to which the Appellants have fallen, both recognising the influence that Mr Jackson-Lipkin’s, occasionally, somewhat eccentric approach to life is likely to have had in the commission of these offences. 

16.While both Baroness Butler-Sloss and Lord Justice Thorpe fall within the category of respectable friends of the Appellants, they are more than merely that.  Both are very eminent persons, whose views demand, by the extensive and wide experience of the law of those who express them, to be taken accorded very great weight.  These are letters of support which were not before the Chief Magistrate.

17.While correctly recognising that the late offer of compensation could not be regarded as remorse on the part of the Appellants, the Chief Magistrate plainly harboured some doubt as to whether or not payment would be made, referring to the fact that at that time it was a mere promise to pay.  However, now the Appellants can say that they have honoured that promise, and to the full extent ordered by the court, have made restitution.

18.I have had placed before me up-to-date medical reports.  These confirm that there has been no real improvement in the ill-health of both Appellants.  Neither are presently enjoying good health, both require much more than mere regular medical care.

19.Both Appellants have now served four months in prison since their conviction.  That is equivalent to having served a term of imprisonment of six months, after allowing for remission for good behaviour.  Even having regard to the amount involved in the Appellants’ offending, for persons in their 9th decade, in poor health, with hitherto impeccable lives and records, and having fallen from grace to the extent that these Appellants have fallen, that is a very significant sentence.

20.Weighing all of these matters, whilst acknowledging that the sentence passed by the Chief Magistrate was perfectly right, I am satisfied that the interests of justice will be appropriately served, both as regards the community and the Appellants, if, as an act of mercy, I were to order that their sentence be reduced so as to allow their immediate release. 

21.That will be the order of the Court.

Mr. Kevin Zervos SC, Senior Assistant Director of Public Prosecutions, for the HKSAR, Respondent

Mr. Clive Grossman SC, instructed by Messrs Boase Cohen & Collins, for the Appellants