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Hksar v Lau Hok Tung And Others

Judgment Cited authorities 5 Cited in 2 Precedent Map Related
Vincent
Judgment Date05 January 2011
Year2011
Citation[2011] 2 HKLRD 205
Judgement NumberHCMA500/2010
Subject MatterMagistracy Appeal
CourtHigh Court (Hong Kong)
HCMA500/2010 HKSAR v. LAU HOK TUNG AND OTHERS

HCMA500/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

(Appellate Jurisdiction)

MAGISTRACY APPEAL NO. 500 OF 2010

(ON APPEAL FROM KTCC 3041 OF 2009, KTCC6856 OF 2009
KTS 9666 OF 2009, KTS 19512 OF 2009 AND
KTS 19514-19521 OF 2009)

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BETWEEN

HKSAR Respondent
and
LAU HOK TUNG
(劉學東)		 1st Appellant
WONG SHU WAH
(王樹華)		 2nd Appellant
Y & FUNG GARMENT COMPANY LIMITED
(偉豐服裝有限公司)		 3rd Appellant

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Before : Hon McMahon J in Court

Date of Hearing : 28 October 2010

Date of Judgment : 5 January 2011

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J U D G M E N T

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1. The three appellants were each convicted after a trial before Mr Dufton at Kwun Tong Magistracy of the same 11 offences of possession for sale or for any purpose of trade or manufacture, of goods to which forged trademarks had been applied, contrary to section 9(2) of the Trades Description Ordinance, Cap. 362 (“the Ordinance”).

2. The 1st appellant was sentenced to 8 months’ imprisonment, his wife the 2nd appellant to 180 hours of community service, and their company the 3rd appellant, of which both were directors and of which the 2nd appellant was company secretary, was fined a total of $250,000.

3. All three appellants appeal their convictions and the 1st appellant also appeals his sentence.

4. The provisions of section 9(2) of the Ordinance are as follows :

“Subject to the provisions of this Ordinance, any person who sells or exposes or has in his possession for sale or for any purpose of trade or manufacture, any goods to which any forged trade mark is applied, or to which any trade mark or mark so nearly resembling a trade mark as to be calculated to deceive is falsely applied, commits on offence.”

5. By section 26(4) of the Ordinance a defence is provided to a person charged with an offence under section 9(2). It is as follows :

“In any proceedings for an offence under section 9(2) it shall be a defence for the person charged to prove that he did not know, had no reason to suspect and could not with reasonable diligence have ascertained, that a forged trade mark had been applied to the goods or that a trade mark or mark so nearly resembling a trade mark as to be calculated to deceive had falsely been applied to the goods.”

6. The prosecution case was that the 3rd appellant was a garment retailing company and owned or rented 11 premises in Hong Kong comprising eight shops, two warehouses and an office.

7. On 14 May 2009 Customs and Excise officers raided all 11 premises and in each found a large number of counterfeit clothing items. In total there were 6,795 items of clothing which were eventually found by the magistrate to bear false brand names such as Abercrombie & Fitch, Reuhl, Hollister, Lacoste, Timberland and Tommy Hilfiger. A total of nine false brand names were found on labels attached to the items of clothing at the 11 premises. The goods found in each of the 11 premises were the basis of a separate charged offence. That resulted in the total of 11 joint charges faced by each appellant.

8. The primary defence case at trial was that the garments were genuine garments and comprised factory rejects, i.e. “seconds”, surplus production or sample garments. Additionally the defence placed reliance on the statutory defence contained in section 26(4) of the Ordinance.

9. The admirably succinct grounds of appeal against conviction advanced by Mr Bruce SC with Mr Sammy Ho and Mr David Khosa on behalf of all three appellants are as follows :

(1) That the magistrate erred in his application of the burden of proof.

(2) That the magistrate erred in holding that section 26(4) of the Ordinance required the appellants to satisfy a persuasive burden of proof.

(3) That the magistrate in any event imposed too high a standard as to what enquiries were “reasonable” in the circumstances of the case so as to satisfy the requirements of section 26(4).

It is accepted that there is no distinction amongst the appellants so far as these grounds are concerned. They stand or fall together.

Ground 1 “The burden of proof”

10. This ground stems from the magistrate’s self-direction at an early stage of his Statement of Findings, to the effect :

“7. I remind myself of the burden and standard of proof and that the burden is on the prosecution throughout. The defendants have to prove nothing. I direct myself that I must be sure of the defendant’s guilt on each charge before I can convict, each charge and summons to be considered separately and the case of each defendant separately. On the other hand if the court thinks that the defence evidence pointing to innocence is true or may be true, it would follow that the defence has raised sufficient doubt in the prosecution case and the defendant entitled to be acquitted.”

11. Mr Bruce complains that the last sentence of the direction omits to state that a reasonable doubt about a defendant’s guilt may arise from within the prosecutions case, and that the direction therefore restricts the magistrate to any finding of doubt arising only in the defence case. Mr Bruce argues that this had a practical effect in the circumstances of the case as there were aspects of the prosecution evidence which assisted the defence.

12. He particularly points to some part of the prosecution evidence which came from a Mr Milano (PW22), a witness the magistrate described as impressive, who gave expert evidence as to the “Abercrombie & Fitch”, “Reuhl” and “Hollister” labelled clothing as being counterfeit. In cross-examination he had agreed that the cut labels (which some items apparently had) could indicate that they were genuine seconds, but could also have been cut to give a false impression to that effect, and that the prices appearing on some of the items were about the same as the wholesale prices of genuine goods, suggesting that there was nothing in the price implying knowledge on the part of the appellants that the goods were counterfeit, and that the price was consistent with genuine “seconds” or “over-run” items.

13. I do not think there is any merit whatsoever in this ground. The magistrate is a professional and very experienced jurist. The suggestion that he may have thought that, if there was some aspect of the prosecution case which aided the appellant’s case that he could not take it into account as evidence assisting the appellant, is simply untenable. There is nothing of substance to suggest the magistrate may have thought he could only consider defence evidence as a source of reasonable doubt. As a starting point the standard direction on the burden and standard of proof given to juries, and which the magistrate gave himself, quite clearly ensures that a jury understands that if, on the prosecution’s case, there remains a doubt as to a defendant’s guilt then they must acquit. Magistrates as professional jurists are certainly in no worse position. Indeed, that the magistrate was well aware that he was not restricted to the defence case as suggested is confirmed by his careful consideration of PW22’s evidence as to whether it did or could give any support to the defence case. He decided it did not.

14. Further, I do not think it can make any difference that there exists in the present case a statutory defence, the onus of proof of which was on the appellant. It was suggested by Mr Bruce that the different onus and standard of proof complicated matters further and compounded the risk of the magistrate overlooking the principle that evidence from the prosecution case could be taken into the appellant’s favour. But the two matters are quite distinct and separate consideration can readily be given to each. Nor, with respect, was Mr Bruce able to advance any substantive argument to the contrary.

15. This ground fails.

Ground 2 “The reverse onus”

16. It was accepted by, or at least implicit in, the argument of both Mr Bruce for the appellants and Ms Alice Chan for the respondent that section 9(2) does not require the prosecution to prove mens rea; the presumption in that regard being displaced by the clear intent of the legislature that the statutory defence available in section 26(4) encompasses the element of mens rea. The issue then remaining is whether the subsection is unconstitutional in placing the burden of proof in establishing that defence upon a defendant.

17. It was never suggested to the magistrate that the defence set out in section 26(4) of the Ordinance required anything other than that the appellant prove that defence on the balance of probabilities. And indeed, no doubt on the basis of the long history of the approach by courts in this jurisdiction to that sub-section, the magistrate found that the persuasive onus was on the accused to establish that defence.

18. Mr Bruce argues now before me that that approach is unconstitutional because it is inconsistent with the principle of the presumption of innocence guaranteed by Article 87 of theBasic Law; Article 14(2) of the International Covenant on Civil and Political Rights (as applied under Article 39 of the Basis Law) and Article 11 of the Hong Kong Bill of Rights.

19. Mr Bruce argues that in the light of the principles expressed by the Court of Final Appeal in HKSAR v Lam Kwong Wai & Another [2006] 9 HKCFAR 574 and HKSAR v Hung Chan Wa & Another [2006] 9 HKCFAR 614, the defence provided for in section 26(4) must either be read down to impose an evidentiary burden only or, alternatively, be found to be unconstitutional. On either basis he says the magistrate was wrong and the conviction of all three appellants must be quashed.

20. There is no doubt that the presumption of innocence is now, in addition to being a...

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2 cases
  • Lau Hok Tung And Others v Hksar
    • Hong Kong
    • Court of Final Appeal (Hong Kong)
    • 30 March 2012
    ...KTCC 6963/2009 (20 May 2010), presently listed as FACC No 5 of 2011. [3] HKSAR v Lau Hok Tung, Wong Shu Wah and Y & Fung Garment Co Ltd [2011] 2 HKLRD 205,presently listed as FACC No 7 of [4] By transliteration. The registered trade mark was “岷山牌六味地黄丸”. [5] Statement of Findings at §45. [6]...
  • Lee To Nei v Hksar
    • Hong Kong
    • Court of Final Appeal (Hong Kong)
    • 30 March 2012
    ...KTCC 6963/2009 (20 May 2010), presently listed as FACC No 5 of 2011. [3] HKSAR v Lau Hok Tung, Wong Shu Wah and Y & Fung Garment Co Ltd [2011] 2 HKLRD 205,presently listed as FACC No 7 of [4] By transliteration. The registered trade mark was “岷山牌六味地黄丸”. [5] Statement of Findings at §45. [6]...

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