HKSAR v. Sherwood Kwok

HCMA 727/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO 727 OF 2012

(ON APPEAL FROM ESCC NO 3729 OF 2011)

------------------------

------------------------

______________

J U D G M E N T

______________

1.The appellant pleaded guilty to 15 counts of using a false instrument, contrary to section 73 of the Crimes Ordinance, Cap 200 and was sentenced to 5 months imprisonment for each count to run concurrently, making a total of 5 months imprisonment. He now appeals against the sentence.

Facts Admitted

2.The appellant was employed as a Sales Manager of the Multi Way Asia Development Limited (“the company”).  Over the period of December 2011 to July 2012 he took a total of 14 days sick leave, producing in support 15 sick leave certificates to the company.  The certificates were purportedly signed by a Chinese medicine practitioner, Mr Wong Chiu Tung, who confirmed that he had never signed or issued such certificates.

3.The false sick leave certificates had caused overpayment of salary of $13,808.22 by the company to the appellant.  The appellant was dismissed on 8 August 2012 and the case was reported to police.

Grounds of Appeal

4.The grounds of appeal of the appellant is as follows:

(a) the magistrate wrongly failed to consider the appellant’s suitability for a community service order when there were grounds for imposition for such an order;

(b) even if a prison sentence was inevitable the magistrate wrongly adopted a starting point of 9 months imprisonment and wrongly gave a discount of 1 month imprisonment for the full restitution of the overpaid salary and the sentence could rightly have been suspended;

(c) the sentence is manifestly excessive and wrong in principle.

Breach of Trust and Community Service Order

5.The appellant contends that the present case is not the type of breach of trust envisaged in the case of R v Barrick [1985] 81 Cr App R 78 and cites in support the following passage in the case:

“The type of case which we are concerned is where a person in a position of trust, for example, an accountant, solicitor, bank employee or postman, has used that privileged and trusted position to defraud his partners or clients or employers or the general public of sizable sums of money.”

6.The court does not accept the contention of the appellant.  It is obvious that the Court of Appeal in the United Kingdom was only giving examples of breach of trust and did not mean the list to be exhaustive.  It recognised that there could be different degree of trust reposed in an offender who would not necessarily be professional men.  This was apparent in the reasoning of the judgment and the matters set out in the judgement which a court should consider in determining the proper level of sentence.  Such matters can be usefully reproduced as follows:

“The following are some of the matters to which the Court will no doubt wish to pay regard in determining what the proper level of sentence should be: (i) the quality and degree of trust reposed in the offender including his rank; (ii) the period over which the fraud or the thefts have been perpetrated; (iii) the use to which the money or property dishonestly taken was put; (iv) the effect upon the victim; (v) the impact of the offences on the public and public confidence; (vi) the effect on fellow-employees or partners; (vii) the effect on the offender himself; (viii) his own history; (ix) those matters of mitigation special to himself such as illness; being placed under great strain by excessive responsibility or the like; where, as sometimes happens, there has been a long delay, say over two years, where, as between his being confronted with his dishonesty by his professional body or the police and the start of his trial; finally, any assistance given to the police.”

7.It can be seen that an employee can be in a trusted position and indeed the case itself concerned an employee abusing such position. No doubt an employee owes a duty of trust to his employer in dealings connected with his capacity as an employee.

8.The appellant cites the case of HKSAR v Chu Lai Sze HCMA 527/2010 in which McMahon J after analysing Barrick had this to say about its comments that immediate imprisonment was inevitable in cases of breach of trust:

“It seems to me that the comments of the court were intended to apply to cases containing elements of misappropriation or fraud or other commercial dishonesty, in circumstances where there was a recognition by the offender that his actions will risk some form of economic or other prejudice to the individual or corporate entity with which he stands in a fiduciary relationship.”

9.In the present case the appellant submitted false sick leave certificates to obtain sick leaves.  An employer obviously cannot be expected to check on the sick leave certificates submitted by its employees for sick leaves and would have to rely on the integrity of the employees on their genuineness.  The appellant in falsifying the sick leave certificates and submitting them must realize that his misdeed would cause economic losses to his employer to whom he owed a duty of trust.  He was no doubt in breach such trust and, as a matter of fact, the counsel representing the appellant in the lower court accepted this without reservation.  Although the breach of trust in the present case differs in nature from that in Barrick, by reason of the above analysis it is still a case of breach of trust envisaged in the case.

10.In his written grounds of appeal the appellant sets out a number of factors concerning his good background, supportive family, plea of guilty, small amount of money involved, making of full restitution, donations to charity, previous good character and the shocking experience of the clang of the prison gates.  The appellant also includes as a factor that the present case was not a case of Barrick breach of trust which the court has just rejected.  The appellant submits that these constitute exceptional circumstances and are proper grounds for the imposition of a community service order.

11.Most of these grounds were advanced in the lower court and considered by the magistrate who rejected them:

“7. In passing sentence, I have considered the facts of this case and all the matters put forward on the Defendant’s behalf very carefully.

8.  There was no dispute that this case involved the breach of trust together with the production and use of 15 false instruments.  It was not an isolated incident but a persistent course of behaviour which would have continued had it not been discovered.  Save in exceptional cases, breach of trust cases normally call for an immediate custodial sentence (See CLARK [1998] 2 Cr App R (S) 95 as applied in CHEUNG Mee-kiu [2006] 4 HKLRD 776).  It would not usually be appropriate in cases of serious breach of trust to suspend any part of the sentence (See R v BARRICK 91985) 81 Cr App R 78 and Lam Chun-hung HCMA 87/1999).  There was nothing exceptional in the present case.  Good family background, good education, supportive family, clear record and a guilty plea are not exceptional circumstances.  The amount of money involved could not be described as small.”

12.The magistrate was correct in rejecting the grounds advanced by the appellant as exceptional circumstances.  The matters to be considered for sentencing set out in Barrick as quoted in the passage above, support the conclusion of the magistrate.  The magistrate correctly took into account that the offences committed were not an isolated incident. They actually spanned over a period of about 8 months from the end of December 2011 to the end of July 2012.

13.It took efforts, time and planning to falsify the 15 sick leave certificates.  The offences were obviously not committed at the spur of the moment but were pre-meditated.  This is one of the matters which Barrick said a sentencing court had to consider.  The court agrees with the magistrate that the inevitable sentence was one of immediate custodial.

14.Ground of appeal (a) fails.

Sentence Manifestly Excessive

15.Grounds of appeal (b) and (c) can be dealt with together.

16.The court is of the view that in determining the level of sentence to be imposed the sentencing guidelines in Cheung Mee Kiu as perfected in HKSAR v Ng Kwok Wing [2008] 4 HKLRD 1017 are to be followed.  In the present case the amount of money involved was about $13,800 which falls within the band of less than $250,000 in the sentencing guidelines which carries a sentence of less than 2 years imprisonment.

17.The appellant complains that the starting point of 9 months imprisonment for each of the offences is manifestly excessive and the discount of one month for the full restitution was manifestly inadequate. On the other hand the respondent argues that the starting point although on the high side is not manifestly excessive and the overall reduction of about 45% for the guilty plea and restitution is a significant discount.  Both the appellant and the respondent cite a number of cases to court illustrating sentences imposed in those cases.  They are of little assistance because their facts differ quite considerably from those in the present case.

18.Although the court finds that the appellant as an employee was in a trusted position, the court considers that the degree of trust reposed in him which he had breached in the circumstances of the present case was relatively low.  This according to Barrick is a factor a court should give regard in sentencing.  Having considered all the circumstances the court is of the view that the appropriate starting point is 6 months imprisonment.

19.As pointed out in HKSAR v Leung Shuk Man CACC 230/2001 there were no guidelines as to precisely what discount should be given where a full or partial restitution had been made and a sensible use of the sentencer’s discretion would normally enable the offender to receive an appropriate discount.

20.The court accepts that the appellant made prompt compensation to his employer, but is also of the view that this coupled with his plea of guilty should warrant a discount of about 50%.  The proper sentence is therefore one of 3 months imprisonment.

Conclusion

21.The appeal against sentence is allowed and the sentence of 5 months imprisonment for each of the offences is set aside and substituted with 3 months imprisonment.  The order that the sentences are to run concurrently remains unchanged.

Ms Vivien Chan, SPP of Department of Justice, for the respondent

Mr Christopher Grounds, instructed by Messrs Henry Wan & Yeung, for the appellant