Shishir Tarachand Kothari v. The Queen

Case No.CACC 795/1979
Court
Court of Appeal
Date13 Jun 1980
Judge
Case Document
100%

CACC000795/1979

IN THE COURT OF APPEAL 1979 No. 795
(Criminal)

BETWEEN
Shishir Tarachand Kothari Appellant

AND

The Queen Respondent

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Coram: Leonard, J.A., Addison & Garcia, JJ.

Date of Judgment: 13 June 1980

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JUDGMENT

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Leonard, J.A. :

1. In the court below the appellant faced five charges. On the first charge he was acquitted of stealing on 5th of May 1978 certain diamonds described in particulars by their exact weight. On the second of stealing other precious stones, he was found to have no case to answer. On the third he was convicted of making a false report to a police officer contrary to section 64(a) of the Police Force Ordinance. On the fourth charge he was also convicted. That also was a charge of theft.

2. The particulars are of importance and I set them out in full.

" 4th Charge : Particulars of Offence
          Shishir Tarachand Kothari, on the 5th day of June 1978, in this Colony, stole one packet of Diamonds Brilliant weighing 38.84 carats, one packet of Diamonds Brilliant Melee weighing 97.58 carats, one packet of Diamonds Brilliant Melee weighing 139.44 carats, one packet of Diamonds Brilliant Melee weighing 162.72 carats and one packet of Diamonds Brilliant weighing 69.64 carats to the approximate value of $265.496 Hong Kong Currency, the property of the Brilliant Almaz Company Limited."

3. It will be noted that each of the five packets is described as Diamond Brilliant or Diamond Brilliant Melee, the exact weight of which is given to two decimal points of a carat. The stones are alleged to be the property of Brilliant Almaz Co. Ltd. (as were the stones particularised in the first charge) and to be of the approximate value of $265,496.

4. With the fifth charge we need not concern ourselves. It was of false accounting and of it the appellant was also found not guilty.

5. The trial was a lengthy and complicated one spread over 23 days from the 25th of June 1979 to the 3rd August 1979, and the trial judge was faced with the necessity of evaluating the evidence of 37 witnesses called by the Crown, and that of the appellant and two witnesses called by him.

6. In his reasons for verdict the trial judge sets the scene with brief synopses of the Crown case and that for the appellant in the following terms :

"           Synopsis of the Crown Case
          All these charges arose from the report on the 5th day of June 1978 of an alleged burglary of the premises occupied by Brilliant Almaz Ltd. at Room 2307 Melbourne Plaza, Queen's Road, Central, Hong Kong. The defendant was the Manager of that Company. The Crown alleged, in short, that during the first five months of 1978 the defendant had lost over $4 million speculating on the local Gold Exchange and in gold futures on the New York Commodity Exchange. Faced with difficulty in meeting these losses, the Crown alleged he staged a burglary of the premises. This, it was alleged was for a twofold purpose. First, he himself took some of the Company's stock to assist in settling his gold debts. Secondly, it enabled his employer to claim under its insurance policy for the loss it had suffered in the burglary."
          Synopsis of the Defence
          To these general allegations the defendant denied he had been involved in the staging of any burglary. He admitted he had lost substantial sums in gold dealing but claimed these were exaggerated and in any event were within his capacity to pay. He gave evidence that other persons had keys to the premises including the safe. The only visit he made to the premises outside normal opening hours during the weekend of the alleged burglary was in the company of certain Canadian diamond dealers who were staying at that time in Hong Kong and who were negotiating substantial purchases of diamonds. Not only did he not commit the alleged offences but several other persons had the opportunity to commit the alleged burglary or otherwise to steal the missing property."

7. It was common case that the burglary was either faked by the appellant or was, to put it vulgarly, an "inside job" made to look like an "outside job".

8. The safe in which the diamonds, the property of Brilliant Almaz Co. Ltd., were or should have been kept, was opened by someone with keys to it and who knew the combination of it. There was evidence that only two persons had keys and knew the combination. There was some evidence that others might have had keys made but none that those others knew the combination. The de facto owner and managing director of Brilliant Almaz Ltd., a Mr. Niwas, was one of those two persons and the appellant the other. Mr. Niwas had financial interests other than dealing in precious stones and had no expertise or skill in dealing in diamonds and it is apparent that the appellant who was employed as manager because of that skill had, subject to the overall control of Mr. Niwas, virtually a free hand in deciding what diamonds should be bought and sold on behalf of Brilliant and at what prices.

9. On the afternoon of Saturday, 3rd of June 1978 the office was closed as normal for the weekend and the appellant and a saleman, Mr. Yuen, were the last to leave. The burglar alarm was set and all doors were locked. Although the safe door could have been left unlocked there is no reason to suppose that it was. There is no reason to suppose that Mr. Niwas visited the office that weekend. He gave evidence in the course of which he denied so visiting it and that evidence was accepted by the trial judge. There was no evidence that he was in the building or in its vicinity.

10. The appellant was seen in the building by a caretaker of Melbourne Plaza after 2.00 p.m. It was the evidence of the caretaker that he saw the appellant near the entrance to the service lift as if about to use it. He said :

"I felt strange as lifts in main hall he did not use them. On seeing me he retreated his hand, did not press the button and ask me to open the toilet."

11. It is noteworthy that there is a concealed T.V. with eleven T.V. screens showing inter alia the entrances to the building, to four of the public lifts but not showing entrances to two public lifts and not showing the goods lift. The T.V. cameras record on to tape.

12. The appellant sought to account for his presence in the building that afternoon by telling the police that he had brought two Canadians to the office so that they might inspect diamonds.

13. We do not propose to deal at length with the evidence as to these Canadians. Suffice it to say that the trial judge would in our view have been amply justified in inferring that they did not exist. He did not so decide. His comment concerning them read :

"Assuming without deciding, that some Canadians did visit the defendant at Room 2307, the evidence is far too tenuous to create a reasonable doubt that they may have obtained sufficient knowledge of both devices from the limited observation they would at most have gained on such visits."

14. It is to be noted at this stage that the appellant had interests other than the management of Brilliant. He was a shareholder and director of Ko Gems Ltd. and Interdiamond Ltd. At the time of the burglary Ko Gems Ltd. was inactive. Interdiamond Ltd. had a capital of $2,500,000. In addition he was a partner in a firm called Diamond Corporation, having a 1/3rd interest in that firm. The other partners in which were a Mr. Jaaveri who apparently left the Colony some time after the 9th of June 1978 owing substantial sums to creditors and a Mr. Choksi.

15. Mr. Choksi gave evidence of a sale made by him to Brilliant through the appellant in April 1978 with which we need not now concern ourselves. In cross-examination he gave evidence as to the problems of identification of diamonds and particularly melee to which I shall have to refer later. Unfortunately, he was not asked any question either in the examination or in cross-examination as to the status of Diamond Corporation.

16. I mention the appellant's interest in Interdiamond Ltd. as it is of some relevance when one comes to consider the appellant's motive for staging the burglary. It is common case that in the months which preceded the 3rd of June he had lost in gold transactions sums which on any normal criterion would be regarded as catastrophic. He used Interdiamond Ltd. Not only as a vehicle for the sale and purchase of diamonds (independently of Brilliant) but also as providing an account on which he could draw cheques. He used its account at an early stage of his gold dealings to discharge his indebtedness on losses.

17. In this connection a topic referred to by the trial judge as "the Majeed loan" is also of interest as it indicates an anxiety on the part of the appellant to conceal the importance to him of these losses. The subject is most readily approached with reference to certain accounts (Exh. D. 7) produced as the accounts of Interdiamond Ltd. In these accounts (at page 1059 of the transcript) there appear the following two entries. They read :

" 17/2/78 Being loan from Mrs. A. Majeed at 10.5% p.a. interest rate received by S.T.K. on behalf of the company." (S.T.K. of course are the initials of the appellant)

The amount stated is $1.5 million.

" 30/4/78 Being repayment of loan to Mrs. A. Majeed together with accrued interest on behalf of the company $1,531,500."

18. There was evidence to the effect that a letter dated the 17th of February 1978 on the letter head of Interdiamond Ltd. signed by the appellant and reading laconically :

"           Received from Mrs. A. Majeed of Teheran, Iran a sum of HK$1,500,000.00 (Hong Kong Dollars One Million and Five Hundred Thousands Only) in cash as a loan for a period of one year at an interest rate of 10 1½% per annum.
          We promise to repay the said loan, plus the interest on or before 16th February, 1979."

was typed not on 17th of February 1978 but after the 5th of June 1978, the typist in question having joined Brilliant Almaz Ltd. on 1st June 1978.

19. The evidence of that typist was contradicted in cross-examination by her predecessor. The predecessor claimed that she had typed it but in April or May rather than on the date in February that it bore.

20. Unfortunately, Exh. D.7 did not see the light of day insofar as the police were concerned until the 15th of February 1979. The police officer by whom they were seized on that day asked the appellant where they come from and was told "these are a new set I need for accounting and to carry on my business".

21. The subject of the Majeed loan is not one which goes to prove that the appellant faked the burglary but the trial judge is to be pardoned if he regards it as casting a somewhat strobe-like light on the credibility of the appellant.

22. One factor indicating careful planning on the part of the appellant is that very shortly before the burglary the appellant caused the amount payable under the policy by which Brilliant's interest in its stock was covered to be doubled. We cannot regard this as something done altruistically or solely for the benefit of Brilliant. Brilliant might be the party to benefit financially by it but the appellant might gain indirectly as any astute employee might if he had been so far-sighted as to double insurance cover less than a week before a burglary.

23. The trial judge has been accused of piling suspicion on suspicion contrary to CHAN Yuet-kwan v. The Queen(1). We do not think he did so. His ratio is to be found at page 469 of his judgment where he said :

"When I review the whole of the evidence relevant to this charge I am satisfied beyond reasonable doubt that the defendant during the weekend of the 3rd and 4th June, 1978 entered Room 2307, he then smashed the window, cut the burglar alarm system, opened the safe, took out its contents, and spread brass cuttings on the carpet to create the appearance that the premises had been burgled. After considering all the possible inferences from the established primary facts, I am satisfied beyond reasonable doubt, that that conclusion is not merely an inference, but the only possible inference, which can be drawn from those facts."

This was the approach which the Full Court suggested was the correct approach in YIM Chor-man & Another v. The Queen(2) where Huggins, J. said :

"The other alleged misdirection is contained in the following passage :

On their own the acts of the defendants may not appear to be incriminating, but considered as a whole the facts cannot admit of any other inference being fairly accepted than that there was a conspiracy by the three defendants, and others not in custody to defraud Pun.'

It is argued that this amounts to adding suspicion to suspicion, which was condemned in CHAN Yuet-kwan v. Reg. as explained in NG Sheung-kwan v. Reg. What the court was dealing with there was an attempt to draw an inference of guilt from other inferences which were not themselves justified. That is a very different thing from drawing an inference of guilt from established facts and it seems clear to us that a combination of apparently innocuous circumstances may in a proper case be the foundation of a finding of guilt."

24. The appellant was then correctly found to be guilty of staging the burglary. This was not the subject of the charges against him. The principal charge remaining, the fourth charge, was of stealing specific diamonds. The question which agitates us as to this is "Was it established that he did steal those specific diamonds?" It is clear that the diamonds he is charged with stealing were those he handed to S.Y. Lee in satisfaction of his indebtedness on gold transactions on the 9th of June 1978. Much had been said in evidence as to the difficulty of identifying small diamonds dealt with in bulk. Mr. Choksi, having modestly disclaimed that he was one of the biggest diamond dealers in the world, when asked if there are "problems of identification with this type of diamond?" said :

" A. : Yes, if not same weight and number. I can identify value of the stones but cannot say that they are the identical stones.
Q. : Given the same quality and weight all you can say that packets are similar?
A. : Yes."

And again later he was asked :

" Q. : As between two experts with same packet of melee on same day vary 80%?
A. : No.
Q. : 27%?
A. : I do not think so.
Q. : 20%?
A. : 15% about highest difference between two appraisers."

He also indicated that there were variations in the price of melee at about this time. At page 312 he was asked :

" Q. : If you deliver a consignment of 200 carats of Indian melee and one month later packet differing slightly in weights, would you recognise it as yours?"

His answer as recorded is somewhat difficult to understand. It reads :

" A. : If of the same type hard, but if my packet of 1/10 and some 3/10 carat Indian melee I would immediately recognise that my diamonds have been mixed with others."

25. Mr. LAW Hung-cheuk who was also 'accused' of being the biggest diamond merchant in Asia but disclaimed that honour, was asked:

" Q. : If two parcels of Indian melee and each weighs 200 carats, similar cutting, similar colour and purity, you were to look at two packets and leave room and return and look at two packets again would you be able to tell which was which?
A. : If two packets were the same in all respects, I could not tell."

At page 305 he was asked :

" Q. : If you sold 200 carats of Indian melee and bought back a month later would you be able to recognize it?
A. : If I do not trust a man I would not give him small stones as he might mix them up. I weigh and examine them and check. I am certain I could."

This again is a most difficult answer to understand. It does indicate to us that this witness considered that there was grave risk of misidentification or fraud inherent in the handling of quantities of Indian melee. We may say that none of us can profess the slightest skill as to the appearance or value of diamonds. We have had the exhibits of the diamonds in question produced to us and to our untutored eyes while one particular parcel contained stones bigger than the others the others seemed identical when compared. This, of course, is a far cry from finding that it would be impossible for an expert to recognise differences.

26. S.Y. Lee, admittedly an unwise investor or counsellor as far as dealings in gold are concerned, says he accepted the appellant's statement that the diamonds handed to him on 9th June 1978 were worth $600,000. It is, however, to the evidence of Mr. WU Pak-hoi that we must look firstly in considering whether or not the identity of these diamonds has been established. He was the expert on whom the Crown clearly relied when drafting the charge in question for the weights given by him and the valuation given by him is that quoted in the charge.

27. Secondly, we must look to the evidence of Mr. Javeri Senior who claimed to identify the diamonds given to S.Y. Lee as those which he passed to Brilliant on consignment in the cases of Lots 1, 2, 3 and 4 or sold to Diamond Corporation in the case of Lot 5 and I think their respective evidence would best be examined by means of a table.

Weight Weight to Javeri as ascertained from consignment  Value to Wu  Value to Javeri 
to Wu note. per carat per carat
Lot I 38.87 41.60 $500 $1,535
(38.92)
Lot II 97.58 98 $400 $545
(97.59)
Lot III 139.44 31.35 $400 $715
(139.45)
302.16
Lot IV 162.72 36.06 $330 at least $545
(162.74) 402.72 at most $1,635
Lot V 69.64 69.66 $1,400 $1,100
(69.17)

28. There is some similarity of weight except for Lots 3 and 4. These total 302.16 carats and it was suggested by Mr. Javeri that they come from three lots weighing respectively 31.35 carats, 36.06 carats and 402.72 carats. The value of these lots, according to Mr. Wu, were $400 or $330 per carat. The values, according to Mr. Javeri, as ascertained from the consignment notes for the goods sold by him was $715 in one case and in the other at least $545 and at most $1,635.

29. I consider that particular attention must be paid to value when considering the validity of any identification of tiny stones such as these for they have to the non-expert only two peculiarities : glitter and value. To an expert value must equally be of importance. The dangers inherent in the identification are obvious. Even if one accepts weight alone as the criterion there are substantial differences in each lot except Lot 5. Even Lot 5 does not correspond absolutely for Lot 5, according to Mr. Wu, weighed either 69.64 carats or 69.17 carats and according to the consignment note it weighed 69.66 carats. On this lot it is to be noted that the value per carat to Mr. Wu was $1,400 whereas the value to Mr. Javeri according to the sale note was $1,100. Assuming in any event that Mr. Javeri Senior was correct in his identification of Lot 5 the Crown is faced with a further difficulty as to that lot. The papers show an outright sale of it to Diamond Corporation. No sale or transfer to Brilliant is shown by the Crown and the Crown have therefore failed to prove that Brilliant had any property in that lot.

30. The identification turns on the evidence of Mr. Javeri Senior and the trial judge accepted him as an honest and truthful witness. Unfortunately, that is not an end of the matter. The trial judge to some extent regarded the evidence of Mr. Javeri's son as of assistance. There were differences between them to which he did not allude.

31. Commenting on Mr. Javeri Senior's evidence he said :

"          Mr. Javeri spent some time in the witness box, examining the diamonds with an eye glass, before he gave his evidence as to identification. As to Lot 5 it weighed 69.54 carats which was only fractionally less than the initial Invoice weight of 69.66 carats. Mr. Javeri also stated that Lot 5 was wrapped in a blue Indian paper which he also recognised as his property."

We do not, of course, know how much reliance the trial judge may have placed on his assumption that Mr. Javeri had said that Lot 5 was wrapped in paper which he recognised as his own. Mr. Javeri said nothing of the kind. What he said was that he recognised the paper not as his own but as blue Indian paper. We have no reason to suppose that such Indian paper is not common to the trade when dealing with Indian melee. If the learned trial judge placed any importance on this purported recognition of the paper he was clearly wrong. It is not in itself perhaps a vital factor but it taken with the differences between the evidence of Mr. Javeri Senior and his son which were apparently unappreciated by the trial judge and the differences in weight and valuation as revealed by the table I have given we have come to the conclusion that the Crown has failed to prove beyond reasonable doubt that the diamonds handed by the appellant to S.Y. Lee were identical with diamonds belonging to Brilliant as described in the consignment notes produced and commented upon by Mr. Javeri Senior. The established fact that the appellant faked the burglary cannot help on this question of identification for he had access to other melee. In those circumstances not without considerable misgivings we have come to the conclusion that the appellant must be acquitted on the fourth charge. It was perhaps unfortunate that he was not charged with attempted fraud on the insurance company.

32. I turn then to the third charge. In that charge the appellant was convicted of making a false report to Chief Inspector O'Brien contrary to section 64(a) of the Police Force Ordinance. Undoubtedly he did tell Chief Inspector O'Brien in the course of the investigation that the premises had been burgled. There was evidence that there had been a burglary albeit faked to look like an outside job and being an inside job. The question then arising is whether the appellant should have been charged under section 64(a) or under section 64(b). The section reads :

"Any person who knowingly -

(a) makes or causes to be made to any police officer a false report of the commission of any offence; or
(b) misleads any police officer by giving false information or by making false statements or accusations,

shall be guilty of an offence ..."

Clearly the section recognises the existence of differences between the making of a false report of the commission of an offence to a police officer and the misleading of a police officer. The intent of the appellant in making the false statement that he undoubtedly did make to Mr. O'Brien was to mislead him. We therefore do not think that he was rightly charged under subsection (a) of the section. The 'or' in the section is clearly disjunctive and the Legislature clearly had in mind two different matters : the first being the making of a false report of the commission of an offence and the second being misleading a police officer by giving false information. The intent to mislead the police must I think be common to both. The position is that the offence of burglary was committed. We can have no doubt but that when the appellant entered the premises on that Saturday afternoon he did so as a trespasser. He did so with the intention not to act as the manager of Brilliant Almaz Ltd. but rather to act as a thief of its property. Accordingly, he did commit burglary and accordingly the report made to Mr. O'Brien was not a false report of the commission of an offence but rather a false report that an offence had been committed by somebody other than him. We do not think that this comes within subsection (a) of the section but consider that it comes within subsection (b).

33. The appellant was charged with making this false report to Mr. O'Brien himself. It is noteworthy that the trial judge finds that he "caused it to be made". In using this phrase he must have been referring to the act of the saleman Yuen who rang up the police on the instructions of the appellant on that Monday morning. That report (the report made by Yuen) was not made to Mr. O'Brien so that the trial judge's mind appears to have been on a report other than that relied on by the prosecution and specified in the charge. For the report made to Mr. O'Brien came considerably later. With the same reluctance of which I have spoken earlier we also consider that this conviction cannot stand. We treat this application for leave to appeal as the appeal. The convictions are quashed and the appellant is accordingly discharged of these offences.

Representation:

Mr. A. Hidden, Q.C., and Mr. R. Barretto (Hampton, Winter & Glynn) for appellant

Mr. F. Stock and Mr. N. Adams, Crown Counsel for Crown/respondent.

(1) Crim. App. No. 212 of 1973, unreported.

(2) (1975) H.K.L.R. 546.