HKSAR v. Fung Yee Man
Read the full judgment text of HCMA 376/2003 on BabelCite. This High Court CFI judgment was delivered on 18 June 2003.
1. The Appellant was convicted after trial on one count of “failing to make application to the Commissioner of Inland Revenue for registration of business”, contrary to sections 5 and 15(1)(c) of the Business Registration Ordinance, Cap. 310, Laws of Hong Kong (Charge 1), and five counts of “obtaining access to a computer with a view to dishonest gain for himself or another”, contrary to section 161(1)(c) of the Crimes Ordinance, Cap. 200, Laws of Hong Kong (Charges 2 to 6). He now appeals again
Cites 1 case
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[English Translation – 英譯本] IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE (APPELLATE JURISDICTION) MAGISTRACY APPEAL NO. 376 OF 2003 (ON APPEAL FROM FLCC NO. 2522 OF 2002) -------------------------------------
------------------------------------- Before: Deputy High Court Judge Pang in Court Date of Hearing: 28 May 2003 Date of Judgment: 18 June 2003 -------------------------- JUDGMENT -------------------------- 1.The Appellant was convicted after trial on one count of “failing to make application to the Commissioner of Inland Revenue for registration of business”, contrary to sections 5 and 15(1)(c) of the Business Registration Ordinance, Cap. 310, Laws of Hong Kong (Charge 1), and five counts of “obtaining access to a computer with a view to dishonest gain for himself or another”, contrary to section 161(1)(c) of the Crimes Ordinance, Cap. 200, Laws of Hong Kong (Charges 2 to 6). He now appeals against all the convictions. Background 2.Charge 1 alleged that, between 1997 and 2000, the Appellant engaged in a business of buying and selling cars but failed to apply to the Commissioner of Inland Revenue for registration of that business. This business of buying and selling cars involved buying dilapidated vehicles from places such as insurance companies, and then repairing the vehicles and selling them. 3.In fact, the Appellant was at the material time a police officer. From 1998 onwards, he worked for the New Territories North Traffic Investigation Division. As he was responsible for handling speeding cases, he was authorized to use a computer system in the police force called VALID III for the purpose of looking up information on offending vehicles and their registered owners. However, the Appellant was found to have accessed the said system on five occasions between December 1999 and March 2001 for personal purposes. This formed the basis of Charges 2 to 6. 4.On the other hand, the Appellant alleged that he bought and sold second-hand cars between 1994 and 2000 because he loved cars and he found that the cars could still be sold for higher than original prices even though they had been used for some time. He therefore kept buying and selling cars in the hope of making profits, but he did not always manage to make a profit, and hence he did not regard what he did as a business. Furthermore, he assessed VALID III he wanted to practise using the system. 5.The above is an outline of the prosecution case and defence case. The evidence 6.The appeal bundle shows that the evidence being relied on by the prosecution mainly consisted of Exhibits P5 to 8, namely documents provided by the Transport Department or downloaded from VALID III regarding particulars of registration of the relevant cars, as well as records of two videotaped interviews of the Appellant under caution. All the above evidence was adduced by consent of the parties, and the contents of Exhibits P5 to 8 were not in dispute. The Appellant himself also gave evidence at trial. The statutory provisions 7.The relevant provisions under section 5 of the Business Registration Ordinance are reproduced below:
8.The provisions make mention of “carry on” or “carrying on”. “Business” is defined in the interpretation provision of the Ordinance to mean “any form of trade, commerce, craftsmanship, profession, calling or other activity carried on for the purpose of gain”. 9.The relevant provisions under section 161 of the Crimes Ordinance are now set out below:
Appeal against Charge 1 10.The Appellant’s ground of appeal against Charge 1 is simple. In a word, the Appellant contends that, during the 4-year period in question, the number of vehicles involved in the Appellant’s dealings was not such as to constitute a business which required business registration. The Appellant argues that what he did was analogous to investment activities such as buying and selling real property and stocks. 11.It is very obvious that the term “business” under section 5 of the Business Registration Ordinance is so widely defined that it encompasses the activities of buying second-hand cars, refurbishing them and then selling them for the purpose of gain. Indeed, this was a finding of fact made by the magistrate and has not been disputed by the Appellant. 12.However, under section 5, a business must be “carried on” in order to become registrable, and the term “carry on” obviously connotes a degree of continuity. This is shown by the requirement under section 5(2) that an application for registration must be made within one month of the commencement of the business. As a matter of common sense, a one-off sale and purchase transaction does not constitute “carrying on”. 13.As regards the question of continuity, it can in my view be considered from two perspectives, namely the platform for transactions and the number of transactions. 14.A platform for transactions means a contact point available to customers for conducting business negotiations. This can be a shop, a letterbox, an Internet address, or even a telephone number. If this contact point is open to public and relatively stable, then even where the business has just commenced or where the number of transactions is very small, the business can still be regarded as continuous and hence being carried on. 15.On the other hand, where considerable transactional activities have been maintained, then even if there is no fixed platform for the transactions or even if the business is kept confidential, those activities can still be regarded as continuous and hence being carried on. 16.Between the two scenarios described above, there will of course be a wide spectrum of modes of activities. Therefore, whether a business is being “carried on” must in the end depend on the circumstances of the particular case. Whether at trial or on appeal, neither party provided the court with relevant case law, and without the benefit of such assistance, the above interpretation of the Ordinance is the only one that I am able to arrive at. 17.Applying the above principles to the present case, I am concerned with the rather ambiguous findings of fact by the magistrate. 18.For example, in her Reasons for Verdict, the magistrate said (at page 8):
19.However, she went on to say (at page 10):
20.This question of “include” or “not include” is by no means insignificant because, according to the records, the Appellant said during the interviews that he “has owned many cars” or “I am not sure how many cars there are under my name, because some of the cars have been crushed and I have not made a report”. This suggested that a large number of cars were involved. In fact, as the magistrate pointed out at page 6 of her Reasons for Verdict, the police had at the videotaped interviews put it to the Appellant that 16 cars had been registered under his name, and although the Appellant did not clearly admitted to it, he said he had some recollection of some of the vehicle registration numbers, i.e. the numbers referred to above. 21.What I mean is that, on all the evidence, the magistrate might have made an irresistible inference that the Appellant had very actively engaged in the sale and purchase of second-hand cars, with frequent transactions and more than 10 cars being involved; but the magistrate had never made this clear. On the contrary, after summarizing the Appellant’s testimony at trial, the magistrate said she held that the Appellant had owned 10 cars. This gives the impression that she had negated the previous proposition of “including” 10 cars, i.e. that more than 10 cars were involved. 22.Furthermore, as the Respondent has fairly pointed out, of the 10 cars that the magistrate referred to, only three (namely HA 528, HH 7353, HP 7495) were registered under the Appellant’s name during the period from 1997 to 2000 (i.e. the period particularized in Charge 1). However, for some unknown reason, the magistrate merely mentioned in the above-cited passage from her Reasons for Verdict that the two cars bought in 2001 were irrelevant to the charge and made no mention whatsoever of, for example, cars bought and sold in 1994. 23.For the above reasons, I am of the view that the magistrate’s findings of fact on Charge 1 are far from clear. Although, as the Respondent has pointed out, the Appellant had admitted that he had put in a lot of effort, vision, money and time in the process and that he had promoted his sales activities by means of advertising in the popular magazine Easyfinder, I still take the view that, no matter what the purpose might have been, the sale within 3 to 4 years of three ordinary cars which were not collectibles did not have the degree of continuity required to constitute “carrying on business” within the meaning of the Ordinance. Appeal against Charges 2 to 6 24.The Appellant’s grounds of appeal are, firstly, that the prosecution was unable to rebut the allegation that the Appellant accessed VALID III to practise using the system, and therefore the magistrate could not make the same finding or regard the Appellant as “dishonest”; and secondly, the information that the Appellant saw upon access to VALID III on the occasions in question was his personal information which he already knew and never printed out, and the information was open to public, and therefore he had never obtained any “gain”. In short, the Appellant contends that his acts did not have two of the elements needed to establish the offence under section 161(1)(c) of the Crimes Ordinance. 25.The Appellant did not deny that he accessed VALID III at the following times to look up information on the following vehicles:
These occasions, in the order set out above, formed the particulars of Charges 2 to 6. And as mentioned above, the five cars in question had been owned by the Appellant. 26.Regarding the Appellant’s explanation that he practised using VALID III with the registration numbers of his own cars, the magistrate rejected the explanation only after a thorough analysis. The analysis began on page 14 of the Reasons for Verdict, where the magistrate reiterated the evidence of the Appellant’s supervisor on the operation of the system and the relevant regulations. The magistrate then set out her assessment of the Appellant’s explanation on each charge and the objective circumstances. The analysis did not conclude until page 23 of the Reasons for Verdict. The analysis is detailed and I do not find any fault in the magistrate’s reasoning. Therefore, I should not and cannot interfere with the magistrate’s findings of fact 27.I now turn to the issue of “gain”. 28.As the Respondent has pointed out, at least in respect of GU 3697, Exhibit P5 shows that the Appellant did not become the registered owner of that car until 15:37 on 21 February 2001, but he already accessed VALID III at 12:34 on the same day to look up information (Charge 4). Similarly, Exhibit P5 and the records of interviews show that the Appellant sold HE 9089 on 14 March 1997, but on 4 January 2001 he used the system to check information on that car (Charge 6). Furthermore, as the magistrate pointed out, according to the records of interviews of the Appellant, HH 7353 had never been found since September 1998 when it was stolen, but the Appellant accessed VALID III in relation to that car on two occasions on 23 December 1999 and 4 January 2001 (Charges 2 and 3). 29.As the Respondent has further pointed out, in respect of any car, the Appellant could in fact use VALID III to check the identity of each owner of the car as well as its registration numbers during various time periods, and this went beyond the information that the public could obtain at any time. This is apparent from a comparison of the contents of Exhibit P5 (Certificate of Particulars of Registration of Vehicle issued pursuant to the Road Traffic (Registration and Licensing of Vehicles) Regulations) and Exhibit P8 (information printed out from VALID III). A similar or indirect admission of the same point was made by the Appellant at the videotaped interviews. 30.It can therefore be seen that, whatever the purpose of the Appellant’s personal access to VALID III might have been, the information he obtained was additional and not something he hitherto possessed. The elements of “dishonesty” and “gain” were therefore present. This was no different from that case of Tsui Shui Lun HCMA 723/1988 to which the magistrate referred. The Appellant’s complaint against the magistrate’s verdict cannot be sustained. Judgment 31.The Appellant’s appeal against Charge 1 is allowed, and his conviction and sentence therefore are set aside. His appeal against Charges 2 to 6 is dismissed.
Mr Cheang Kei Hong, Senior Government Counsel, for the HKSAR. Mr Kwong Ki Tack, instructed by Louis KY Pau & Co, for the Defendant. Translated by Mr. Edmund Cham, Solicitor |
Cases cited in this judgment
Further hearings and rulings under HCMA 376/2003