Chua Kim Leng Timothy v Public Prosecutor

• Jurisdiction: Singapore
• Judge: Yong Pung How CJ
• Judgment Date: 14 April 2004
• Neutral Citation: [2004] SGHC 74
• Docket Number: Magistrate's Appeal No 206 of 2003
• Date: 14 April 2004
• Published date: 20 April 2004
• Year: 2004
• Plaintiff Counsel: Davinder Singh SC and Tey Tsun Hang (Drew and Napier LLC)
• Citation: [2004] SGHC 74
• Defendant Counsel: Christopher Ong Siu Jin (Deputy Public Prosecutor)
• Court: High Court (Singapore)
• Subject Matter: Whether district judge failed to appreciate that sentencing norm for such corruption offences is imposition of fine,Criminal Procedure and Sentencing,Corruption offences,Whether district judge erred in not giving due consideration to fact that offences took place in commercial context,Whether district judge erred in departing from general principle that giver of gratification bears equal culpability to that of receiver,Sentencing,Benchmark sentences,Principles,Whether district judge failed to appreciate true nature of public interest at stake

14 April 2004

Yong Pung How CJ:

1 This was an appeal against the decision of District Judge Jasvender Kaur. The appellant, Chua Kim Leng Timothy (“Chua”), was convicted on a total of ten charges under s 6(b) of the Prevention of Corruption Act (Cap 241, 1993 Rev Ed) (“PCA”). Another 76 charges were taken into consideration for the purpose of sentencing.

2 All 86 charges related to bribes paid to bunker surveyors for overlooking short deliveries of fuel oil and/or deliberate short pumping and/or provision of a lower and cheaper grade of fuel oil to vessels than that which was contracted for. Chua was sentenced to three months’ imprisonment and a fine of $50,000 (in default five months’ imprisonment) on each of seven of the ten charges. On each of the remaining three charges, Chua was sentenced to one month’s imprisonment and a fine of $20,000 (in default two months’ imprisonment). The sentences imposed in respect of three of the charges were ordered to run consecutively. In total, Chua was sentenced to ten months’ imprisonment and fined $410,000. He paid the fine and appealed against the sentence of ten months’ imprisonment. At the end of the hearing, I dismissed the appeal. I now give my reasons.

Facts

3 In 1998, Chua incorporated Navi Marine Services Pte Ltd (“Navi Marine”) to deal mainly with ship bunkering. Navi Marine’s clients were bunker traders who acted as brokers or middlemen for shipowners or charterers of vessels that required refuelling. The shipowners or charterers would approach a bunker trader to source for a fuel oil supplier. The bunker traders would obtain quotations on the price of the required grade of fuel oil and select a company to supply the fuel. Navi Marine was one such supplier. The shipowner or charterer would then pay the bunker trader who would in turn pay Navi Marine.

4 To assist in this process of bunkering, Navi Marine employed programmers to take charge of co-ordinating the loading of fuel oil from suppliers and its supply to vessels. Bunker clerks were also employed to be present on board Navi Marine’s barges. Their duty was to ensure that the correct quantity and quality of bunkers was delivered to a vessel and to prepare the requisite documentation.

5 During the actual bunkering process, the bunker supplier’s representative and the vessel’s representative would be present. Navi Marine, being the bunker supplier, would have its bunker clerk on board its barge as its representative. The chief engineer of the vessel would usually be the vessel’s representative. At times, a bunker surveyor would be engaged by the vessel owner or charterer to check and certify that the correct quantity and quality of fuel oil was supplied during the bunker transfer. It was in the context of such a process that Chua managed to commit the bribery offences.

Techniques that aided the commission of the bribery offences

6 There were three methods which supported the system of bribes paid out by Chua: (a) the “buy-back” scheme, (b) short supply to vessels and (c) provision of a lower grade of fuel oil.

Buy-back

7 This was an arrangement by which the chief engineer of a vessel colluded with Navi Marine to receive less fuel oil than was reflected in the contract for which the vessel owner or charterer was invoiced. The chief engineer would be paid for the amount that was not delivered. The chief engineer would inform the bunker clerk of the quantity of fuel oil (and the price per metric tonne, usually well below the market price) that he wanted to sell back to Navi Marine. The bunker clerk would then inform the programmer on duty, who would in turn decide on whether the chief engineer’s “offer” should be accepted. These programmers were empowered by Chua to make such decisions. Notably, Chua had capped the price of the buy-backs at US$45 per metric tonne. As such, if the chief engineer asked for a higher price, the programmer on duty would seek Chua’s approval before executing the buy-back.

Short supply to vessels

8 This was a process by which the bunker clerks used various methods to cheat customers by deliberately short supplying fuel oil to the vessels. The short supply generally took place without the knowledge of the chief engineer and was termed as “gains” in Navi Marine. Chua would instruct his bunker clerks to make as many “gains” as possible, and would query and scold the bunker clerks if few “gains” were made in a month. The bunker clerks received an incentive payment for the “gains” they made.

Provision of lower grade of fuel oil

9 The two common grades of marine fuel oil delivered to vessels were 380 CST and 180 CST. 180 CST was the lighter and more expensive of the two (costing US$3 to US$5 per metric tonne more than 380 CST). In his statement, Chua admitted that he instructed his bunker clerks to “pump a proportion of lower grade fuel of 380 CST for each ship whenever possible even when the requirement in the nomination form was of a higher grade such as 180 CST”. Pursuant to such instructions, the bunker clerks would employ certain methods to avoid detection of the lower grade by the vessel’s representative.

The payment of bribes to the bunker surveyors

10 In order to carry out these three schemes, a system was devised to bribe the bunker surveyors into overlooking certain lapses. For instance, to overlook the provision of a lower grade of fuel oil, the bunker surveyors were paid $1.50 per metric tonne. To overlook the shortfall in fuel oil, as a result of a “buy-back”, they were paid $10 per metric tonne. If a short delivery was made by the bunker clerk with the knowledge of the bunker surveyor, the bunker surveyor was paid a rate of between US$45 to US$60 per metric tonne for fuel oil and US$90 per metric tonne for diesel oil, calculated on 60% of the quantity short supplied. The remaining 40% would be treated as “gains” of Navi Marine. The programmers would then hand the bribe money to the bunker surveyors a few days or up to a week after the bunker supply, in the vicinity of the World Trade Centre.

The decision below

11 Essentially, the district judge observed that on all the charges, the facts indicated that the respective bunker surveyors were approached by the bunker clerks with promises of gratification in exchange for overlooking a “buy-back” and/or short delivery and/or provision of a lower grade of fuel oil. The district judge also noted that none of the bunker traders who were invoiced would have made the payment had they known that a poorer grade and a lesser quantity of fuel oil was supplied. Accordingly, the district judge convicted Chua on five charges for offences under the PCA. Chua then pleaded guilty to a further five similar charges.

12 As to sentence, the district judge took into account the fact that the other accused persons (63 bunker surveyors), who faced similar charges and had pleaded guilty, were all fined. She recognised that the general principle in such cases would be that the giver and receiver of the gratification were considered equally culpable. Therefore, sentences meted out should be similar in respect of both parties. However, the district judge observed that in some cases, the giver deserved more punishment: Chua Tiong Tiong v PP [2001] 3 SLR 425.

13 In this respect, she took into account the fact that it was Chua who had set in place a system of paying incentives to his bunker clerks to make “gains”, in order to motivate them to obtain as much “gains” as possible through clandestine means. It was also Chua who had instructed his bunker clerks to deliver the cheaper and lower grade of fuel oil, 380 CST, in place of 180 CST. Thus, the district judge held that while the surveyors had succumbed to temptation when offered bribes to overlook Chua’s schemes, it was plain that the person who had put the temptation in their minds was Chua, through his employees. She also held that it was Chua who stood to gain the most by short delivery. As such, the district judge found that Chua’s culpability was greater than that of the receivers (bunker surveyors), and it was therefore reasonable to make a distinction in the respective sentences meted out to them.

14 The district judge then considered the issue of whether a fine or a custodial sentence should be imposed. She referred to PP v Tan Fook Sum [1999] 2 SLR 523 at [21], where it was held, following the view of Professor Tan Yock Lin in Criminal Procedure (LexisNexis, 1997) ch XVIII at para 852, that “only the public interest should affect the type of sentence to be imposed while only aggravating or mitigating circumstances affect the duration or severity of the sentence imposed”. In light of this, the district judge observed that Chua’s offence was tantamount to defrauding the charterers and owners of 86 vessels over a two-year period.

15 She considered the repercussions of such offences on Singapore’s economy, Singapore being the world’s busiest bunkering port with sales of more than 20 million tonnes of bunkers annually (Business Times, 20 June 2003). The district judge held that the unethical practices adopted by the accused had the effect of tarnishing Singapore’s image as a port of quality bunkers. Therefore, a custodial term was warranted in view of the public interest and in order to send a signal that such unethical practices would not be tolerated.

16 The district judge then considered what the appropriate length of the sentence should be, taking into account the mitigating and aggravating factors. She considered the fact that Chua had accepted responsibility by pleading guilty and had consented to 76 similar charges being taken into consideration. She also noted that Chua had a clean record and that he had made some contributions to charity. However, she observed that it was plain that Chua had made significant profits by short delivering bunkers and was motivated by greed. The district judge balanced these various considerations before arriving at the overall sentence of ten...