Luk Ying Tai v The Queen

IN THE SUPREME COURT OF HONG KONG

APPELLATE JURISDICTION

CRIMINAL APPEAL NO.246 OF 1968

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

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

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

JUDGMENT

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

1. On March 25th 1968 the appellant was convicted of selling wrist watches bearing a false description, namely, "Swiss made" contrary to section 3(2) of the Merchandise Marks Ordinance. He was fined $750. He appeals to the court against his conviction on four grounds.

2. The facts are simple. The appellant is the proprietor of a business which is engaged in the watch trade. He is the registered owner of a trade mark for watches. The movements for the watches are imported, the watch cases are made here and the watches are assembled here. Then they are sold by the appellant to retailers or are exported. The appellant is not a retailer.

3. Originally the watch movements came from Switzerland and when the watches were sold by the appellant they were marked on the dial "Swiss made". Later the watch movements were obtained from countries other than Switzerland but the same mould bearing the impression "Swiss made" was used for the dials. The appellant instructed his foreman to see that the words "Swiss made" were erased from any watches which contained movements which did not come from Switzerland. The appellant has not been incorporating Swiss movements in his watches since 1966.

4. However there were exhibited to the court nineteen watches bearing the description "Swiss made". It is not in dispute that these watches were sold by the appellant and that the description "Swiss made" is a false description: the watch movements having come from Russia.

5. The factory of the appellant is small and there are about six persons engaged in assembling the watches. Some 2,000 watches are assembled daily. At the material time the dials of the watches were printed in the appellant's factory with his trade mark, and the words "Swiss made". When dry the words "Swiss made" were erased - which is a very easy process taking about 30 seconds.

6. The appellant was asked why he had not had a new mould made without the words "Swiss made" appearing on it. His unconvincing answer was that a mould was difficult to make, and it would cost one hundred dollars. He also said that someone might make a duplicate of the mould, which is perhaps an even more unconvincing answer when it is realised that the appellant has been engaged in this trade for 30 years and has a registered trade mark.

7. The truth of the matter is that the appellant had an inefficient assembly line. No check was made of the watches after they had been assembled. And what has occurred is that nineteen watches bearing the erroneous description have slipped by.

8. At the trial in the Magistrates Court the appellant was acquitted of another offence in respect of the same watches. He was charged with causing a false description, namely "Swiss made" to be applied to the dials of the nineteen watches contrary to section 3(1)(d) of the Merchandise Marks Ordinance. In acquitting him on this charge the Magistrate said that though he did not find the evidence of the appellant very impressive he thought that on the balance of probabilities the appellant had acted without the intent to defraud.

9. As to the charge on which he was convicted the Magistrate held that the appellant cannot escape liability because on his own evidence he failed to take precautions necessary to avoid committing an offence under section 3(2) of the Ordinance or that he had an inefficient assembly line which resulted directly in such an offence being committed.

10. The first ground of appeal is that it was not open to the Magistrate to find the appellant guilty of the offence under section 3(2) and at the same time to acquit him of an offence under section 3(1)(d) of the Ordinance. The evidence being exactly the same in each case. Or at any rate the verdicts are inconsistent.

11. If I understand the argument correctly it is this - the defence open to an accused under section 3(1) is exactly the same as that open to him under section 3(2); absence of intent to defraud under the former subsection must be equated with acting innocently under the latter.

12. With respect I do not see anything in this point. The two subsections deal with entirely different offences: nor are the defences the same. A person charged with applying a false trade description is guilty of an offence unless he can satisfy the court that he acted without fraud. A person charged with selling goods bearing a false description is guilty of an offence unless he can satisfy the court that he acted innocently. This is entirely different. Various cases were quoted to me to show that the intent to defraud referred to in section 3(1) of the Ordinance bears a very special meaning and covers cases where there is no moral fault. To come within the ambit of the section it is not necessary to prove that a seller is attempting to pass off inferior goods.

13. But I do not think that this helps us here. In...