Kwong Wing-foon and Another v. The Queen
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CACC000683/1982
------ Coram: Jones, J. Date: 16 September 1982 __________ JUDGMENT __________ PRELIMINARY 1. On the 1st June 1982 the appellants together with one other person who was the lst defendant at the trial were convicted of two charges of false accounting contrary to Section 19(1)(a) of the Theft Ordinance Cap. 210. The 1st appellant was fined a total sum of $3,000 and the 2nd appellant $2,000. 2. The appellants appeal against conviction. 3. Section 19(1) provides:
FACTS 4. The appellants are directors of Centre Vono Co. Ltd. (hereafter called Centre Vono) a company registered in Hong Kong. 5. On the 6th October 1980 Centre Vono entered into a joint venture agreement with Jin Ji Accumulator Factory (hereafter referred to as Jin Ji) of Kai Ping Yuan China to provide material, equipment and technical expertise for the production of accumulators. 6. It was agreed that after Jin Ji had manufactured the accumulators they were to be shipped to Hong Kong and marketed by Centre Vono. Payment for the equipment supplied to Jin Ji was to be made by a deduction of 40% later reduced to 25% from sales of the product effected by Centre Vono. 7. In November 1980 Mr. Kwan Hang-Sun a representative of Jin Ji went with some representatives of Centre Vono including the 2nd appellant to Chen Hsong Machinery Co. Ltd. of Sham Shui Po to obtain a quotation for the purchase of an injection moulding machine. A quotation of $368,000 on the basis that the buyer was overseas was made which included delivery to China, servicing and insurance. A 5% discount was allowed so that the net price amounted to $349,600. It is not clear whether this quotation was communicated to the authorities of Jin Ji in China. 8. On the 12th February 1981 Centre Vono entered into an agreement with Chen Hsong to purchase an injection moulding machine for $322,000 which was the price quoted for a sale to a local buyer with a discount of 5% the net purchase price was $305,900. A sales contract and invoice evidencing the transaction were executed 9. Mr. Tony Wong the former marketing manager of Chen Hsong shortly afterwards handed a blank sales contract and invoice to Centre Vono. These documents, the subject matter of the two charges, were completed on the instructions of the 1st defendant and in the presence of the 1st appellant with corresponding details except that the purchase price was stated to be $368,000. 10. It is not in dispute that these two documents were false, and were for accounting purposes. 11. Having purchased the machine at the local price Centre Vono with the false documents resold the machine to Jin Ji at the overseas rice. The machinery was delivered to Jin Ji on the 22nd July 1981. 12. Both appellants were interviewed by officers of I.C.A.C. in July 1981. The 1st appellant made a cautioned statement on the l7th July 1981 and the 2nd appellant made a cautioned statement on the 16th July 1981. 13. The appellants were jointly charged with the 1st defendant. The particulars of offence alleged that the documents were falsified for an accounting purpose dishonestly with a view to gain for themselves. However, at the conclusion of the evidence for the Crown, the learned magistrate amended the two charges by adding the words 'or another' after 'gain for yourselves' as an alternative. No evidence was called by the 1st defendant or the appellants. CASE AGAINST 1ST APPELLANT 14. Leung Yuk Chun was employed as cashier by Ming Fat Company which holds shares in Centre Vono. He prepared the false documents on the instructions of the 1st defendant. 15. In his cautioned statement the 1st appellant said that he, the 1st defendant and the 2nd appellant requester Mr. Wong to supply a blank agreement and invoice of Chen Hsong when the genuine agreement was signed and the first payment was made. He also claimed that they agreed that the overseas price should be set out in the documents and that he and the 1st defendant suggested that the documents be completed by Leung Yuk Chun. Later he said that the difference of some $40,000 was to be to Centre Vono. 16. Mr. Mullick submitted on behalf of the appellants that the price of $305,900 did not include the cost of transportation, insurance, servicing and interest charges which necessarily had to be paid by Centre Vono whereas these costs would have been included in the overseas price. 17. However, it is clear from the evidence of Mr. Chiang the managing director of Chen Hsong that a contract for the overseas price of $368,000 was F.O.B which excluded transportation charges. As a result transportation charges would have to be paid in any event. There was no evidence to support the contention that the difference was also earmarked for the other matters. CASE AGAINST 2ND APPELLANT 18. In his cautioned statement the 2nd appellant said that either the 1st defendant or the 1st appellant proposed sharing the difference between the overseas price and the local price to which he and the others agreed. He also agreed that they would quote the overseas price to Jin Ji and knew that the false documents were to be given to Jin Ji for accounting purposes. In his penultimate answer he said that the difference in price would be appropriated to Centre Vono for payment of transportation. It is clear that the 2nd appellant was fully aware of the purpose for which the documents were to be used, and that the gain would either be shared or be passed onto Centre Vono. CONCLUSION 19. The evidence contained in the statements is only admissible against the maker. However, on their own admissions it is clear that both appellants knew that the documents were false and were to be used for accounting purposes. A gain of over $40,000 would result from the sale to Jin Ji at the overseas price. Although the learned magistrate found despite the amendment to the charges that the defendants had a view to gain for themselves, it appears in any event that they either intended to do so personally or for the benefit of the company. Was the learned magistrate right to hold that the appellants acted dishonestly? The test for dishonesty was laid doom in R. v. Freely (1) and was approved in R. v. Landy & Others (2) and R. v. McIvor(3) . The question to be asked by the learned magistrate was 'Am I sure the appellants were acting dishonestly because I can see no reason why men of their intelligence and experience would not have appreciated as right-minded people would have done that what they were doing was dishonest. This is a question of fact. 20. The only reasonable inference to be drawn from the evidence was that the appellants acted dishonestly as a result of a common design. 21. The appeals against conviction are therefore dismissed.
(1) (1973) 1 All E.R. 341 (2) (1981) l All E.R. 1172 (3) (1982) 1 All E.R. 491 Representation: Mr. Mullick (K.Y. Woo & Co.) for Appellant Mr. Stirling (Legal Department) for Respondent. |