The Queen v. Wong Chi Foon and Another
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CACC000097/1984
BETWEEN
____________ Coram: McMullin, V.-P., Li & Silke, JJ.A. Date: 30 May 1984 __________ JUDGMENT __________ Silke, J.A.: 1. WONG Chi-foon, Assistant Sub-Manager, Outward Documents Bills Division of the Sin Hua Bank - "D1" - and CHENG Tsor-pui, proprietor of Exclusive Bag Enterprises -"D2" -appeared for trial in the District Court on a number of charges relating to the defrauding of the Sin Hua Bank. 2. They were jointly charged with a conspiracy to defraud during the period of April 1982 and 1st December 1982. The allegation was that they dishonestly caused the Bank to lend money to D2 through the medium of D1 without providing adequate security therefor. There were ten additional charges on the indictment. Four of them exclusively concerned D1 and six others exclusively concerned D2. 3. D1 was found guilty upon two of the charges-the joint conspiracy to defraud and the fourth charge on the indictment brought under section 9(1)(a) of the Prevention of Bribery Ordinance and in which it was alleged that he, as an agent, accepted an advantage in the sum of $6,000 "on account of his forbearing to do an act in relation to his principal's business, namely to obtain adequate security for loans made to the said CHENG Tsor-pui by the said bank." 4. D2 was convicted of the joint conspiracy charge and also of five other charges. The fifth charge upon the indictment was the mirror of the fourth charge against Dl and alleged that D2 offered that advantage to D1 and for the same reason. 5. They now seek leave to appeal against their convictions confined to the fourth and fifth charges. 6. The case for the prosecution, briefly, was that Dl was originally a clerk in the Outward Documents Bills Division of the Sin Hua Bank and D2, a merchant, wished to discount Letters of Credit with the Bank and dealt through D1. When the relationship first came into being it was perfectly aboveboard and Letters of Credit with the proper documentation were submitted and discounted in the normal way. A friendship grew up between D1 and D2 and D1, in the course of that friendship, allowed D2 to present applications without Letters of Credit but which Letters were presented within a few days. 7. At the end of 1981 D2 started to get into financial difficulty. During the conspiracy period of April to December 1982, Dl assisted D2 in obtaining loans where either no Letters of Credit at all were produced or where false documents were attached to the applications for the purpose of giving them versimilitude. By the end of that period the Bank had, through the medium of D1, advanced some $4.65 million in unsecured loans to D2. 8. While D1 was under the supervision of a superior, Mr. Fu, who gave evidence at trial, no real check was carried out by the Bank to see that the papers were in proper order. Mr. Fu merely checked the actual amounts involved and then placed his chop upon the applications because he trusted D1 to see that the documentation was in order. A factor of which D1 was aware. 9. The facts grounding the charges with which we are concerned are that in June of 1982 at the time when three pseudo applications were brought to D1 for discounting D1 received from D2 a cheque in the sum of $6,000 which he then passed, on the 2nd July, through his own account. There was evidence that that sum was not withdrawn until December in that year. The cheque itself had the payee's name left blank and it was the case for the Crown that this $6,000 was a form of sweetener to D1 who had, in a long statement of self criticism to the Bank, stated that he expected some form of reward from D2 for the assistance he gave him. 10. The defence raised, and it is of note that D1 gave no evidence at trial but called two witnesses and that D2 did give evidence and called four witnesses, was that this payment was an innocent payment relating to a Sin Hua Bank trip to Japan upon which D1 was joining and in which D2 with his fiancee were joining. 11. It is not contested that such a trip did take place with the two defendants and the girl being members of the party and it is not contested that the cost per head was in the region of $2,900. 12. There was evidence that the payments to the travel agency were made by one LEUNG, also a member of the Bank staff and a witness. The first was made on 15th September, the second on the 1st October and the third and final payment on the 5th October. LEUNG stated in evidence that D1 had paid the deposit of $500 by transferring that from his savings account to the Tour account and had paid the balance in cash. He was unsure of the actual date of the deposit payment by D1 but thought it to have been in early September with the balance paid towards the end of September or the beginning of October. D1 had also paid over the money due by D2 and his fiancee. How this was paid he was uncertain. He did state positively that it was not possible for D1 to have given him a cheque signed by D2. 13. D2 in his evidence stated that the cheque given to D1 on the 30th June was for the purpose of the trip to Japan. Upon being shown the cheque for $6,000 he thought that that was the one. 14. In his admirably detailed Reasons for Verdict in what was a complicated case, the trial judge said this:
15. It is the contention of Mr. Westbrook, who appeared for both applicants before us, that the trial judge was wrong in saying that this was the only proper inference. He submitted that there were other inferences which could properly be drawn and, further, that the reasoning of the trial judge was faulty in his drawing of that only inference. 16. The trial judge had considered the evidence given by D2 together with D2's uncontested statement to be not an explanation of the truth. He stated "his (D2) explanation was generally weak and particularly so when explaining what happened to the balance". This latter was a reference to a conversation which occurred between D2 and D1 while in Japan when Dl had said that there was some slight balance left from the tour money and that they might as well pay for the beer they were drinking out of it. It seems that this balance was in the region of a couple of $100. 17. I confess I do not quite follow the trial judge's reasoning on this aspect and I doubt the significance which he attached to it. It could have happened as recounted by D2 and even if it did not the amount of the balance was so insignificant that little weight could be attached to either it or the explanation given for it unless the trial judge thought, viewing the rest of the evidence, that it was a concoction. He did not so specifically find. 18. Mr. Westbrook submitted that the trial judge misconstrued the evidence when he was considering the statement and certain answers therein given by D2. D2 was asked at question 25 did he have any money dealings with D1 to which he replied that D1 was his friend and had recently lent him a total of $145,000. Apart from that, he went on, there was no other money dealings. One question later he was asked: "Besides the above sum did he offer any advantage to D1" - which appears an odd question in the circumstances for it was D1 who had lent him $145,000. However, his answer was:
19. At question 35 in the interview he was taxed directly with the $6,000 cheque and he was asked "What is your explanation?" to which he answered "I did not do that." There was no reference to any Japan trip. 20. The trial judge posed to himself the following question:
21. Despite Mr. Westbrook's strictures we think this posed question to have been a sensible one. It is not a comment on silence but a comment on an actual answer given in the statement in contrast to the evidence given in Court by D2. 22. Mr. Westbrook has referred us to Bramblevale Ltd. (1) as an authority for the proposition that where there are two equally likely possibilities before the Court it is not right to hold that an offence is proved beyond reasonable doubt. We accept this proposition but Bramblevale(1) concerned contempt of Court, the burden of proof and a single issue which, the Court of Appeal clearly thought, could have gone either way. That is not the case here. 23. It is odd that if the Japan trip were to be paid for by this cheque given in June the actual proceeds of that cheque do not appear ever to have been used to make payment. It is equally odd that the cheque should be given in June whereas payments were demanded only in September. It is equally odd that this cheque was given to a man who, on his own admission, expected some reward and at a time when three spurious applications were being processed by him.
24. We accept that this seems a meagre reward - and it is the only one of which there is any proof - in respect of facilities improperly granted which on the whole of the evidence amounted to over four million dollars. 25. Mr. Westbrook has made the further points that one would not expect D1, a banker, to pay into his own account a cheque, easily traceable if it were corrupt; and that as he beat his breast in public in his statement to the Bank so why not go the whole way and confess to this acceptance also. 26. The trial judge was without the benefit of any further explanation from D1 and he disbelieved, we think with justification, the evidenc of D2 and it is of course only the evidence of D2 and not his statement which could have any bearing on the guilt of D1. 27. Given the matrix of facts surrounding these charges and the view the trial judge took of the explanations offered we would accept that it was a compelling inference that an advantage was offered and accepted. That being so, we think the convictions to be sound and the application for leave is refused. Sentence 28. The 1st defendant, WONG Chi-foon, was sentenced to a totality of three years' imprisonment - being two years' imprisonment on the conspiracy to defraud charge and one year's imprisonment, consecutive, on the acceptance of an advantage count. 29. The 2nd defendant received similar sentences: two years on count 1 and one year on count 2, consecutive. In addition he was sentenced-on the forgery and uttering counts 8, 9, 10 and 11 - to nine months on each. That on count 9 being concurrent with 8 and count 11 being concurrent with 10 but each set being consecutive one with the other. A totality of four and a half years' imprisonment. 30. We accept that this scheme was not set up from the outset with an intent to defraud. It grew from the financial difficulties in which the 2nd defendant found himself at the end of 1981 and the beginning of 1982. The fraud was assisted by the total lack of supervision in the Sin Hua Bank. 31. That having been said, we would accept, to a limited extent, Mr. Westbrook's contention in relation to the "consecutive and concurrent" point. Perhaps it would have been better had the trial judge arrived first at a proper sentence in respect of the conspiracy bearing in mind the differing circumstances of the two defendants, in particular those of the 2nd defendant in relation to the forgeries produced not at the request of the 1st defendant but for the purposes of salving the 1st defendant's conscience and of course continuing the fraud. 32. The totality of the sentences imposed upon the 1st defendant we do not think to be in any way wrong. He was in breach of trust as an employee of the Bank which aggrevates the offence. 33. As to the 2nd defendant, we think the extra year and a half was too great a distinction as between his participation and that of the 1st defendant. 34. We would therefore allow the application of the 2nd defendant in part. The sentence of two years on the conspiracy to defraud count is left undisturbed as is the sentence of one year's imprisonment consecutive in relation to the offering of an advantage count. The forgery and the uttering counts were very much part and parcel of the conspiracy but aggrevate it. We would not disturb the quantum of the sentence passed but we would make them concurrent one with the other but consecutive to the first two counts. This achieves a totality of three years and nine months which reflects the seriousness of the part played by the 2nd defendant. 35. The order will therefore be that the application of the 1st defendant for leave to appeal against sentence is granted but the appeal dismissed: the application by the 2nd defendant is granted and the appeal allowed in part as indicated. Representation: S.N. Westbrook, Esq. instructed by Messrs. Arthur Au & Co. for both applicants. K. Longley, Esq. for Crown/Respondent. |