Case Detail

IN THE COURT OF APPEAL

No. 186 of 1987
(Criminal)

BETWEEN

THE QUEEN

and

CURRENCY BROKERS (H.K.) LTD (D1)

ROBERT LEE FLICKINGER (D2)

Coram: Hon. Yang, Ag. C.J., Kempster & Power, JJ.A.

Dates of Hearing: 4th, 11th & 25th June 1987

Date of Judgment: 25th June 1987

______________

JUDGMENT

______________

Kempster, J.A.:

1. On 10th July 1986 in Victoria District Court Currency Brokers (Hong Kong) Ltd and Robert Lee Flickinger were convicted on their own pleas of bookmaking contrary to section 7(1)(a) of the Gambling Ordinance (Cap. 148) and to section 84 of the Interpretation and General Clauses Ordinance (Cap 1). They now seek an eight month extension of time in which to apply for leave to appeal, if that be necessary, alternatively to serve notices of appeal against such convictions pursuant to section 83(1)(2) and (3) of the Criminal Procedure Ordinance (Cap. 221). I take the view that the points sought to be relied upon are points of law and that appeals lie as of right subject to the time factor.

2. The pleas of guilty would normally preclude any appeal but in circumstances where, upon admitted facts, appellants could not lawfully have been convicted of the offences charged, as is here contended, an appeal may nonetheless be sustained since, by analogy with a positive ruling, in accepting the pleas the judge would be deemed to have made an erroneous decision in 1aw: R v Hunt[1]; R v Whitehouse[2].

3. As for the reasons for this belated application the company and Mr. Flickinger pleaded guilty after considering legal advice. They were represented at the hearing. But in the light of representations said subsequently to have been made by the police to the Immigration Department and to have demonstrated a less favourable attitude to the offences than that shown by Judge Chism Mr. Flickinger, and through him the company, repented of their pleas although he and his solicitors were too heavily engaged in other litigation immediately to make the necessary applications. Time ran on. The knowledge of the attitude of the police must have come to Mr. Flickinger’s notice at the end of February 1987 and he did not swear an affidavit until the 7th or file applications until 14th April. This is a scenario which hardly prompts me to favour the exercise of the Court's undoubted discretion in favour of any extension of time.

4. The classic approach in this context was expressed by Viscount Caldecote, CJ in R v Cullum[3]; quoting an earlier judgment of Humphreys J:

The rules are of importance. We have constantly refused applications for an extension of time within which to make an appeal when there have been no substantial merits brought to our notice which seem to justify the Court in extending the time.

There is other good authority that the merits, in the sense of the prospects of success if time were to be extended, should be taken into account. R v Marsh & Others[4]; In R v Lee[5] and R v Foster[6]. In the latter cases the Court even received fresh evidence on appeals from convictions in relation to which pleas of guilty had been entered.

5. Section 7(1)(a) of the Gambling Ordinance reads:

Any person who engages in bookmaking commits an offence.

And bookmaking is defined in section 2 as meaning

the soliciting, receiving or negotiating of a bet by way of trade or business whether personally or by letter, telephone ,telegram or by any other means.

A bet is not specifically defined but in ordinary English usage it means the staking of money or other value on the outcome of an uncertain event or doubtful issue or in support of an affirmation or forecast. The term wager may be regarded as synonymous. The best-known legal definition of a bet or wager, to be found in the judgment of Hawkins J. in a redoubtable case known to all students of the law, is a transaction

- by which two persons, professing to hold opposite views touching the issue of a future uncertain event, mutually agree that, dependent upon the determination of that event, one shall win from the other, and that other shall pay or hand over to him, a sum of money or other stake; neither of the contracting parties having any other interest in that contract than the sum or stake he will so win or lose, there being no other real consideration for the making of such contract by either of the parties. It is essential to a wagering contract that each party may under it either win or lose, whether he win or lose being dependent on the issue of the event, and, therefore, remaining uncertain until that issue is known. If either of the parties may win but cannot lose, or may lose but cannot win, it is not a wagering contract. Carlillv The Carbolic Smoke Ball Company[7]

This decision was affirmed in the Court of Appeal: 1893 1 QB 256. The only qualification that I would venture to make is that the material event need not be one that must occur in the future; a qualification that has no relevance in the instant case. Before parting with this aspect of the matter it might, perhaps, he observed that the Gaming Act 1845 does not apply in Hong Kong.

6. The Summary of Facts agreed between the Crown and the applicants disclosed just such a situation as was defined by Hawkins J; particularly when read in conjunction with the considered pleas of guilty. Members of the public entering into what were called leverage contracts with the company, by way of its trade or business, staked, that is to say put at hazard, sums of money dependent on the appreciation or depreciation of nominated foreign currencies within a period open to their election but subject to a maximum of 180 days; accepting the New York Spot Market price for the nominated currency at any material time as the benchmark. If the chosen currency rose in value in relation to the US$ within the relevant period the company would be liable to pay the other party a sum converted into HK$ proportionate both to the rise and to the amount of the currency specified. If it fell the other party would be liable to the company mutatis mutandis. One party would win and the other lose. The existence of service and handling fees, which were not dependant on the outcome of the wager, do not affect the analysis. In no circumstances was the other contracting party entitled to require the delivery by the company of any amount of the chosen foreign currency.

7. Whether or not reputable financial institutions offer contracts of a similar nature is neither here nor there. I would only say that those that have been drawn to the attention of this Court are markedly different in important respects from the leverage contracts with which we are concerned.

8. All I need say in conclusion is that the applicants' prospects of success are not sufficiently strong to persuade me to extend the time for service of notices of appeal in the circumstances already outlined. I would dismiss the applications.

(M. Kempster)
Justice of Appeal

Yang, Ag. C.J.:

9. For the reasons given by my brother Kempster I too would dismiss the applications.

(T.L. Yang)
Justice of Appeal

Power, J.A.:

10. I concur with all has fallen from my brother Kempster and would also dismiss the applications.

(N .P. Power)
Justice of Appeal

Gordon Hampton (Haldane, Midgley & Co.) for Applicants

J. Sulan & S.R. Bailey for Crown

[1] 1986 82 Cr. App. R. 244

[2] 1977 1 WLR 925

[3] (1943) 28 Cr. App. R. 150

[4] (1936) 25 Cr. App. R. 1949

[5] [1984] 1 WLR 578

[6] [1985] QB 115

[7] 1892 2 QB 484 at p.490

No. 186 of 1987
(Criminal)

H E A D N O T E

Criminal law and procedure - powers of District Court - power to give absolute and conditional discharge and to "bind over" - meaning of "conviction" - subsistence of defective conviction until quashed - judicial review of a conviction of the District Court.

An individual and a corporation pleaded "guilty" in the District Court to offences under the Gambling Ordinance (Cap. 148). The individual was "discharged absolutely" and the corporation, against which a conviction was recorded, ordered to pay costs. Both individual and corporation asked the Court of Appeal to extend the time within which they might apply for leave to appeal against their respective "convictions". The Crown took the preliminary point that even if time were to be extended the "convictions" were bad for want of jurisdiction and that, in consequence, they could not be the subject matter of appeals.

In a ruling on the preliminary point

Held: (1) That even if bad the “convictions” stood until and unless quashed and could, therefore, be the subject matter of appeals or related applications.

(2) That the appropriate way to seek to quash the "convictions" was by way of judicial review.

The Crown accordingly failed on the preliminary point. Applicants put to their election. Extent and sources of the powers of the District Court in criminal matters considered.

IN THE COURT OF APPEAL

No. 186 of 1987
(Criminal)

BETWEEN

THE QUEEN

and

CURRENCY BROKERS (H.K.) LTD. (D1)

ROBERT LEE FLICKINGER (D2)

Coram: Hon. Yang, Ag. C.J. Kempster & Power, JJ.A.

Dates of Hearing: 4th & 11th June 1987

Date of Judgment: 25th June 1987

___________________________________________

JUDGMENT ON A PRELIMINARY ISSUE

___________________________________________

Kempster, J .A.:

1. This is the judgment of the Court.

2. On 10th July 1986 in Victoria District Court Currency BrOkers (Hong Kong) Ltd and Robert Lee Flickinger, both being legally represented, pleaded guilty to bookmaking between 4th March and 25th April 1986 contrary to section 7(1)(a) of the Gambling Ordinance (Cap. 148) and to sec t ion 84 of the Interpretation and Genera1 Clauses Ordinance (Cap. 1). Judge Chism recorded a conviction against the company but imposed no penalty save to order the payment of costs. Mr. Flickinger be "discharged absolutely."

3. By Notices filed on 14th April 1987 both the company and Mr. Flickinger sought and still seek an eight month extension of time in which to apply for leave to appeal against their respective "convictions". Since, however, the grounds relied upon would appear to involve a question of law alone leave may not be necessary although extension of time in which to serve notice of appeal is. Be that as it may the preliminary point is taken by the Crown that the company and Mr. Flickinger were not validly convicted so as to allow of such applications or appeals even if time were to be extended. By agreement we shall now rule on this submission as a preliminary point.

4. Magistrates presently dealing with such offences, which are punishable on summary conviction, have a statutory power under section 36 of the Magistrates' Ordinance (Cap. 227), after conviction, to discharge an offender either absolutely or conditionally upon his entering into a recognisance, with or without sureties, to be of good behaviour and to appear for sentence when called upon to do so within a period not longer than three years from the date of the order. A power to award costs is also granted. On 10th July 1986 a magistrate could also take one or other of these courses with or without recording a conviction. These powers are analogous to those accorded to magistrates to bind over persons before them, whether or not convicted and whether or not, in the case of a conviction, such conviction has been recorded, to be of good behaviour :or to keep the peace when it has emerged that a breach of the peace might well occur thereafter: Justices of the Peace Act 1361; Application of English Law Ordinance (Cap. 88) ; R v Aubrey Fletcher[1].

5. The relevant powers of the District Court differ from those of magistrates, are more limited than those of the Crown Court in England and, in a territory where distinction between felonies and misdemeanours has survived, are not so readily to be ascertained. It is not suggested that Hong Kong has any equivalent to section 7 of the Powers of Criminal Courts Act 1973 (previously section 7 of the Criminal Justice Act 1948) or to section 1(7) of the Justices of the Peace Act 1968 giving to the higher courts equivalent powers to those of magistrates in the material regard.

6. In. the discharge of its criminal jurisdiction the District Court, a creature of statute, has powers similar to those which would have been exercisable by the High Court had an accused been committed to that court for trial including those of imposing any punishment available to the High Court by statute; subject to a limitation on the length of sentence which may be imposed: District Court Ordinance (Cap. 336) sections 75(1) and 82(2) and (5). Thus it has power to fine in certain circumstances: Criminal Procedure Ordinance (Cap. 221) section 113A. It therefore falls for consideration whether or not the High Court has power to give an offender an absolute or conditional discharge and also to condemn him in costs and, if so, whether a conviction is a condition precedent.

7. Section 107 of the Criminal Procedure Ordinance, strangely headed "Probation of first offenders" reads:-

"(1) Where any person has been convicted on indictment of any offence punishable with imprisonment and the court is of opinion that, having regard to the character, antecedents, age, health, or mental condition of the person charged, or to the trivial nature of the offence, or to the extenuating circumstances under which the offence was committed, it is inexpedient to inflict any punishment or any other than a nominal punishment, the court may, in lieu of imposing a sentence of imprisonment, make an order discharging the offender conditionally on his entering into a recognizance, with or without sureties, to be of good behaviour and to appear for sentence when called on at any time during such period, not exceeding 3 years, as may be specified in the order.

(2) The court may, where it makes an order under this section, further order that the offender shall pay such costs of the proceedings as the court thinks reasonable."

It is to be observed that for this course of action to be available to a sentencing judge in the High Court or the District Court there must be a prior conviction on indictment or charge-sheet (District Court Ordinance section 79(1)) of an offence punishable with imprisonment. “Bookmaking” as charged is so punishable.

8. Since the High Court is “a superior court of record" which exercises an "original jurisdiction of a like nature and extent as that held and exercised in criminal matters by the High Court of Justice and the Crown Court in England respectively -" [Supreme Court Ordinance (Cap. 4) Section 12] the question arises as to whether the power to discharge an offender absolutely or conditionally comes within its inherent jurisdiction. Such a jurisdiction is normally confined to the prevention of abuse of the Court's process, the preservation of the subject matter of a cause and of related documents and to the award of punishment for contempt. However, where no maximum term or other statutory inhibition arises in relation to a common law offence the courts have an inherent power to sentence an offender to a term of imprisonment which is not inordinate: Castro v R[2]. In Hong Kong the power is to a great extent superseded by the terms of section 90 of the Interpretation and General Clauses Ordinance.

9. More to the point, the Courts have an inherent power to bind over a convicted person on recognisance to come up for judgment if called upon, but meanwhile to be of good behaviour. This power is recognised by the terms of section 1(7) of the Powers of Criminal Courts Act 1973 and of section 79(2)(b) of the Supreme Court ACL 1981.

"That power must be distinguished from a number of other powers conferred on English criminal courts by statute such as the power to grant a conditional discharge, the power to pass a suspended sentence, the power to defer sentence and the power to make a probation order" per Mr. Advocate-General Warner in a reference to the Court of Justice of the European Communities: R v Saunders[3].

We respectfully agree and would only add that no power exists at common law to grant an absolute discharge either. Like a conditional discharge it derives from statute; initially the Criminal Justice Act 1948 section 7.

10. Recording a conviction against the company but not against Mr. Flickinger the judge did not purport to discharge either upon the terms required by section 107 of the Criminal Procedure Ordinance or under 'the inherent, jurisdiction. No more did his orders reflect the powers he might have exercised had he been sitting as a magistrate. None of these courses is apt in relation to a corporation in any event. The question nonetheless remains whether the company or Mr. Flickinger or both was or were “convicted” so as to be entitled to appeal or to apply for leave to appeal pursuant to section 82 of the Criminal Procedure Ordinance.

11. Depending on the context "conviction" may mean either a finding of guilt, whether or not following a related plea, as it obviously does for the purposes of section 81 of the District Court Ordinance, or a final disposal of the case: S (an infant) v Manchester City Recorder[4]; R v Drew[5]; R v Robertson[6]. Here the Judge purported to accept the pleas of guilty and finally to dispose of the case in relation to each accused; perhaps with some of the provisions of section 36 of the Magistrates Ordinance or of section 3 of the Probation of OffendersOrdinance (Cap. 298), as then worded, in mind. That he elected not to record a conviction as against Mr. Flickinger matters not because once his plea of guilty had been accepted he stood convicted nonetheless: Oaten v Auty[7]. We are satisfied that both the company and Mr. Flickinger were "convicted" whichever meaning of "conviction" may be thought appropriate. Further, for the purposes of appeal an order for payment of costs constitutes a "sentence". Criminal Procedure Ordinance section 80(1).

12. While the Crown's submission that the convictions, in the sense of final disposal, were bad for want of jurisdiction on the face of the record would seem to have considerable force we make no concluded finding to such effect. It is unnecessary for us to do so and the matter may more fully be argued elsewhere. We reject the related submission that applications or appeals in relation to the convictions cannot lie. Convictions of the District Court, as of all courts, stand until and unless quashed: R v Willesden JJ[8].

13. In the absence of any equivalent statutory provision to sections 28 and 29(3) of the Supreme Court Act 1981 the appropriate, machinery for quashing a conviction is that of judicial review: R v Crown Court at Knightbridge[9]. The process of appeal is wholly inappropriate as it predicates convictions made within the parameters of the Court's jurisdiction albeit subject to challenge on the grounds outlined in section 83(1) of the Criminal Procedure Ordinance. Further, the applicants or appellants have not sought to rely upon such grounds.

14. Should the company and Mr. Flickinger wish to seek leave, out of time, to apply for the judicial review of the convictions rather than to pursue their applications for time to be extended to apply to appeal on other interesting points of law arising from the terms of the Gambling Ordinance we will adjourn this hearing sine die to allow them so to do. It is, however, only fair to remind them of the terms of section 25(1) of the Supreme Court Ordinance:

"Where a person who has been sentenced for an offence by - the District Court applies to the High Court for an order of certiorari to remove the proceedings before the - District Court into the High Court and the High Court determines that - the District Court had no power to pass the sentence, the High Court may, instead of quashing the conviction, amend it by substituting for the sentenced passed any sentence which - the District Court had power to impose."

15. We await their election.

(M. Kempster)
Justice of Appeal

Gordon Hampton (Haldane, Midgley & Co.) for Applicants

J. Sulan & S.R. Bailey for Crown

[1] [1969] 2 ALL ER 846

[2] (1880) 5 QBD 490 at p.509

[3] 1980 1 QB 72 at p.73

[4] 1971 AC 481

[5] [1985] 1 WLR 914

[6] “Times” 13^th June 1987

[7] 1919 2 KB 278

[8] 1948 1 KB 397

[9] [1981] 3 WLR 601

THE QUEEN v. CURRENCY BROKERS (HK) LTD AND ANOTHER

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