Hksar v Chan Kam Ching (陳鑑清)

CourtCourt of Final Appeal (Hong Kong)
Judgment Date14 April 2022
Neutral Citation[2022] HKCFA 7
Judgement NumberFACC10/2021
FACC10/2021 HKSAR v. CHAN KAM CHING (陳鑑清)

FACC No. 10 of 2021

[2022] HKCFA 7

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 10 OF 2021 (CRIMINAL)

(ON APPEAL FROM CACC NO. 230 OF 2019)

________________________

BETWEEN
HKSAR Respondent
and
CHAN KAM CHING (陳鑑清) Appellant

________________________

Before: Chief Justice Cheung, Mr Justice Ribeiro PJ, Mr Justice Fok PJ, Mr Justice Lam PJ and Lord Phillips of Worth Matravers NPJ

Date of Hearing: 16 March 2022

Date of Judgment: 14 April 2022

____________________

JUDGMENT

____________________

Chief Justice Cheung :

1. I agree with the judgment of Mr Justice Ribeiro PJ.

Mr Justice Ribeiro PJ :

2. This appeal is concerned with what constitutes falsity for the purposes of forgery-related offences involving use of a false instrument under the Crimes Ordinance (“CO”).[1] It also concerns the principles governing substitution of a conviction of another offence in place of an offence for which the accused was originally charged and convicted. In examining the latter question, this judgment will have occasion to consider whether dishonesty is an element of the fraud offence created by section 16A of the Theft Ordinance.[2]

I. THE CO OFFENCES

3. The appellant, Chan Kam Ching, a solicitor practising under the name of John Chan & Co, was involved with his clients in dealings relating to a property in Tuen Mun (“the property”). Those dealings occurred in connection with the Government’s Small House Policy which enables eligible indigenous inhabitants of the New Territories to build village houses for their own occupation on concessionary terms. The appellant was convicted after trial before HH Judge K Lo[3] of using a false instrument and using a copy of a false instrument contrary to sections 73 and 74 of the CO. He was sentenced to a total of 8 months’ imprisonment suspended for 2 years. His appeal to the Court of Appeal was dismissed.[4]

A. The applicable CO provisions

4. Section 73 provides:

“A person who uses an instrument which is, and which he knows or believes to be, false, with the intention of inducing somebody to accept it as genuine, and by reason of so accepting it to do or not to do some act to his own or any other person’s prejudice, commits an offence and is liable on conviction on indictment to imprisonment for 14 years.”

5. Section 74 is to the same effect, the difference being that it refers to using “a copy of an instrument which is ... false (etc)” intending to induce somebody “to accept it as a copy of a genuine instrument”.

6. By its Determination dated 13 December 2021, the Appeal Committee[5] granted leave to appeal in respect of the following question, namely:

“What on the true construction of the CO, is the meaning of ‘false instrument’ where section 69(a)(vii) is relied on?”

7. CO section 69 defines falsity for the purposes of Part IX of the CO which includes sections 73 and 74, as follows:

“For the purpose of this Part—

(a) an instrument is false if it purports to have been—

(i) made in the form in which it is made by a person who did not in fact make it in that form;

(ii) made in the form in which it is made on the authority of a person who did not in fact authorize its making in that form;

(iii) made in the terms in which it is made by a person who did not in fact make it in those terms;

(iv) made in the terms in which it is made on the authority of a person who did not in fact authorize its making on those terms;

(v) altered in any respect by a person who did not in fact alter it in that respect;

(vi) altered in any respect on the authority of any person who did not in fact authorize its alteration in that respect;

(vii) made or altered on a date on which or place at which or otherwise in circumstances in which it was not in fact made or altered; or

(viii) made or altered by an existing person but he did not in fact exist; ...”

B. The charges

8. The appellant faced three charges. Charge 1, brought under section 74, alleges that he used a copy of a sale and purchase agreement (“SPA”) dated 4 June 2007 relating to the property which was, and which he knew or believed to be, a false instrument, with the intention of inducing GE Capital (Hong Kong) Limited (a finance company) (“GE”) to accept it as a copy of a genuine instrument, and by reason of so accepting it, to do or not to do some act to its own or any other person’s prejudice.[6]

9. Charges 2 and 3 relate to his using the said SPA and an assignment of the property dated 21 June 2007 (“Assignment”), both allegedly being instruments which were false and known or believed by him to be false, intending to cause staff at the Land Registry to accept them as genuine and by reason of so accepting them, to do or not to do some act to their own or any other person’s prejudice.[7]

10. In response to a request by the defence, the prosecution provided by letter dated 14 August 2018 particulars of the alleged falsity of the two instruments in question. Those particulars are considered in the discussion which follows.[8]

11. Particulars of the prejudice alleged were not stated in the charge sheet, but the prosecution’s case at the trial was that the intended prejudice under Charge 1 involved GE’s grant of a mortgage loan; and that such prejudice under Charges 2 and 3 involved causing the Land Registry officers to register the false SPA and Assignment instruments proffered.[9]

C. The facts

C.1 The Small House Policy

12. It is necessary to appreciate certain features of the Small House Policy which inform the events which occurred. The Policy was recently described in this Court’s decision in Kwok Cheuk Kin v Director of Lands[10]as follows:

“The beneficiaries of the Policy are ‘indigenous villagers’ of the New Territories. This means adult males descended through the male line from a resident in 1898 of a recognised village. Recognised villages are villages included in a list approved by the Director of Lands. There are currently 642 recognised villages. The Policy relates to land in the village or its immediate environs which are not affected by any impending development or future planning or development proposals. Its object is to enable an eligible villager to build, once in his lifetime, a small house in his own village for his own occupation. It allows him to apply for three kinds of grant: (i) a free building licence, which is a licence to build on private land at a nil premium in the case of pre-1898 villages or a full premium in the case of villages recognised since that date; (ii) a private treaty grant of government land at a reduced premium; and (iii) an exchange, involving the surrender of an existing title in exchange for the grant of a new title at a nil premium so far as it was private land and a reduced premium so far as it was government land. ... Over the years, benefits under the Policy have come to be known as ‘Ding rights’.”[11]

13. Thus, only a person who qualifies as a New Territories indigenous villager (a “Ding”) is eligible for the grant of a right to build, once in his lifetime, a small house on land which he owns or acquires in his village for his own occupation on such concessionary terms. The building licence granted imposes a restriction on alienation of the land generally (as in the present case) for a period of five years from the date when the District Lands Office (“DLO”) issues the certificate of compliance upon completion of the building.[12]

C.2 The initial acquisition of the land

14. The relevant events unfolded in three phases. The first spans the period from November 1996 to 2000. On 15 November 1996, the property (which consisted of agricultural land) was acquired by So Chi (“So”) and Lau Chi Wai (“Lau”) for $380,000. They caused it to be conveyed on the same day to Chan Wai Man (“Chan”) ostensibly for $200,000. Chan was a Ding and was thereupon registered as the property’s owner.

15. The land was within Chan’s village and solicitors (Leung Kin & Co) were instructed to act on his behalf in applying on 18 November 1996 to the Tuen Mun DLO for a building licence, Chan declaring himself eligible under the Small House Policy. A year later, the DLO accepted his application in principle and, on 2 January 1998, Chan executed a power of attorney in favour of So, authorising So to act in dealings with the DLO. Chan was obviously a mere nominee, with So and Lau being the beneficial owners of the property.

16. On 17 April 1998, the DLO issued a building licence in favour of Chan which So executed as Chan’s attorney. As indicated earlier, it was a condition of the licence that there was a restriction on alienation of the property for five years from the eventual issue of the certificate of compliance.[13]

C.3 Shum, Lai and the appellant enter the scene

17. The next phase spans the period from October 2000 to May 2007. On 26 October 2000, So, ostensibly acting as Chan’s attorney, signed an agreement to transfer what was stated to be the beneficial interest of So and Lau in the property to Lai Yee Kum, Kate (“Lai”) for $1,050,000. Lai was described as the “de facto wife” of Shum Kin Wing (“Shum”) who funded the acquisition and regarded himself as beneficially entitled to the interest agreed to be assigned to Lai. The appellant acted as solicitor on behalf of Shum and Lai and witnessed the execution of the agreement which was not registered in the Land Registry. So and Lau then dropped out of the picture with Chan remaining the registered owner of the property. Chan had to retain that status so that the concessionary terms of the Small House Policy could continue to be pursued.

18. Shum and Lai proceeded to build a house on the property. In December 2001, the appellant’s firm, stating that it was acting on Chan’s behalf, informed the DLO that the building had...

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