Hwa Lai Heng Ricky v Public Prosecutor

• Jurisdiction: Singapore
• Judge: Yong Pung How CJ
• Judgment Date: 14 October 2005
• Neutral Citation: [2005] SGHC 195
• Court: High Court (Singapore)
• Published date: 11 May 2006
• Year: 2005
• Plaintiff Counsel: T U Naidu and K R Manickavasagam (T U Naidu and Co)
• Defendant Counsel: Han Ming Kuang and Lee Jwee Nguan (Deputy Public Prosecutors)
• Subject Matter: Criminal Law,Cheating,Elements of offence,Whether the elements have been made out,Whether victim deceived and induced by representation,Whether inducement needed to be the sole reason for delivery of property,Whether victim's negligence and breach precluded a conviction of cheating,Abetment,Abetment by conspiracy,Essence of conspiracy,Whether separate and independent intentions which coincide sufficient to amount to conspiracy,Whether finding of abetment by conspiracy established on facts,Abetment by aiding,Intentionally aiding commission of offence,Whether the appellant facilitated the commission of the offence,Criminal Procedure and Sentencing,Appeal,Power of High Court in appellate capacity to amend charges,Relevant considerations in exercise of power,s 256(b)(ii) Criminal Procedure Code (Cap 68, 1985 Rev Ed),Charge,Amendment of charge,Conviction on amended charge,No prejudice to appellant
• Citation: [2005] SGHC 195

1 The appellant, Hwa Lai Heng Ricky, was charged under s 420 read with s 109 of the Penal Code (Cap 224, 1985 Rev Ed) (“the Penal Code”) for allegedly conspiring with one Roger Cheong Sing Whee (“Cheong”) and one Joyce Tia Hui Yee (“Joyce”) to cheat the Development Bank of Singapore Ltd (“DBS”) into disbursing $1,940,000 to Yamazaki Mazah Singapore Pte Ltd (“Yamazaki”). The district judge convicted the appellant and sentenced him to a term of 20 months’ imprisonment. The appellant appealed against both conviction and sentence. After careful and detailed consideration, I amended the charge of conspiracy to one of abetment by intentional aiding and dismissed the appeal against conviction. I further reduced the sentence to a term of 18 months’ imprisonment. I now give my reasons.

Background facts

2 The appellant was an assistant sales manager of Yamazaki, a company in the business of manufacturing and repairing machinery. He was responsible for collecting orders, co-ordinating production schedules, preparing delivery orders and invoices, and collecting payment from customers. Cheong was a majority shareholder and Managing Director of Sin Yuh Industries Pte Ltd (“Sin Yuh”), a company which manufactured precision machine components for sale to integrated circuit manufacturers and computer makers. Joyce was Sin Yuh’s Finance Manager.

3 Sometime in late 2001 and early 2002, Sin Yuh purchased 47 machines amounting to a total of $4,874,750 from Yamazaki in anticipation of increased production from a new project. Sin Yuh issued 36 post-dated cheques in favour of Yamazaki to pay for all the machines. However, due to cash flow problems, Yamazaki was able to present only seven of these cheques (amounting to a total of $902,460) for payment. Joyce managed to secure financing by way of hire purchase agreements with Arab-Malaysian Finance Bhd (“Arab-Malaysian”) for nine machines and Tokyo Leasing (Singapore) Pte Ltd (“Tokyo Leasing”) for six machines in May 2002. The appellant was aware of these hire purchase arrangements and had in fact earlier confirmed with the two hire purchase companies that Yamazaki had received $438,000 (from Sin Yuh’s cleared cheques) towards the payment of the relevant 15 machines. As for the remaining 32 machines, Sin Yuh applied to DBS for a loan under the Regionalisation Finance Scheme (“RFS”). The appellant came to know of this loan application from Joyce sometime before May 2002. On 21 May 2002, DBS agreed to finance Sin Yuh $1.94m or 60% of the valuation or purchase price for 31 specified Yamazaki machines, whichever was lower.

4 Under DBS’s letter of offer dated 21 May 2002 (“the Letter of Offer”), there was an important precondition in cl 2(j)(i) before the loan could be disbursed. It states as follows:

Prior to disbursement of the Machinery Loan I and II, you [Sin Yuh] shall furnish evidence satisfactory to DBS Bank that the difference between the cost of the said machinery and the loan has been paid.

5 Accordingly, Sin Yuh had to furnish satisfactory evidence to DBS that it had paid 40% of the purchase price of the 31 machines to Yamazaki, which amounted to $1.293m. Upon the fulfilment of this precondition and the completion of relevant legal documentation (which was done sometime in November/December 2002), DBS would disburse $1.94m to Sin Yuh. Cheong and Joyce were both aware that this precondition must be satisfied before DBS would disburse the loan. In fact, sometime before 13 December 2002, Joyce received a request from DBS for a letter requiring confirmation that this precondition had been completed. Cheong knew, and was concerned, that Sin Yuh did not satisfy this precondition. Nonetheless, he asked Joyce to seek such a letter from Yamazaki. On 13 December 2002, Joyce sent an e-mail to the appellant, requesting the latter to prepare such a letter to DBS. By that time, the appellant was aware that DBS was going to provide financing of only $1.94m, and not the entire sum, for the 31 outstanding machines. He complied with Joyce’s instructions and on or before 16 December 2002, he prepared and signed a letter to DBS (“P64”) stating that Yamazaki had received from Sin Yuh $1.293m as down payment for the 31 machines intended to be financed by DBS. Further, the letter requested DBS to transfer to Yamazaki’s account the balance amount of $1.94m. This confirmation letter was later sent to DBS.

6 Following which, Cheong proceeded to send a request to DBS’s solicitors on 16 January 2003 for the loan to be disbursed. Subsequently, DBS delivered by way of bank transfer $1.94m to Yamazaki’s bank account on 10 March 2003. However, Sin Yuh defaulted on the DBS loan repayment and in fact did not make any of the instalment payments to DBS. DBS later repossessed and sold 26 of the 31 machines secured to the loan. As for the remaining five machines, they were repossessed by Yamazaki in Malaysia. DBS was not able to repossess these five machines because Yamazaki had not been fully paid for them.

The Prosecution’s case

7 The Prosecution called upon several witnesses who were personnel in the Sale, Credit and Credit Documentation Departments of DBS at the material time. Collectively, their evidence sought to establish the procedures on loan applications and disbursements. It was also through their testimonies that the Prosecution contended that DBS had been deceived and induced by P64.

8 The Prosecution further relied on Joyce’s and Cheong’s testimonies. It was suggested that the appellant had frequently chased Joyce and Cheong for full payment of the machines, during which the appellant would ask Sin Yuh to request DBS to expedite the loan disbursement. The Prosecution argued that it could be inferred from the appellant’s actions from as early as October 2002, that the appellant knew that DBS was not going to finance the full amount of the 31 machines and knew that there were moneys outstanding for the machines even after DBS were to disburse the loan amounts. The Prosecution submitted that the appellant prepared and signed P64, despite knowing that Sin Yuh had not paid the amount stated in P64. As a result of the representation contained therein, DBS delivered S$1.94m on 10 March 2003 to Yamazaki’s bank account.

The Defence’s case

9 The crux of the Defence’s case rested on the contention that the appellant had been instructed by Joyce, in a visit to the premises of Sin Yuh, to treat the moneys being disbursed by the other two finance companies, Arab-Malaysian and Tokyo Leasing, as constituting the 40% deposit for the DBS machines. Counsel for the appellant asserted that the appellant prepared the letter P64 on these instructions. P64 was then sent to Joyce, who in turn sent it to DBS. The appellant claimed that he was unaware that such a course of action was wrong and he believed that he was perfectly entitled to do so. It was further contended that not one prosecution witness gave evidence that he or she was induced or deceived by P64 or the appellant. Finally, since $1.93m was such a huge amount, DBS should have done its own due diligence before disbursing this sum.

The decision below

10 The trial judge was satisfied that the Prosecution had proved beyond reasonable doubt that DBS was deceived by the appellant’s confirmation letter, P64, and thereby induced into disbursing $1.94m to Yamazaki. In addition, the trial judge found that the representation contained in P64 was false as Sin Yuh had not paid Yamazaki 40% of the purchase price for the 31 machines and the appellant had acted with dishonest intention in preparing P64.

11 It was held that the fact that there are other matters which DBS had to consider in finally allowing the loan disbursement was inconsequential. The trial judge also found that Cheong conspired with Joyce to cheat DBS and that although Joyce did not explicitly convey to the appellant her intention to cheat DBS at all material times, the appellant was clearly party to the cheating scam and had acted with dishonest intention. As regards the appellant’s contention that he was instructed to “reallocate funds”, the trial judge was unconvinced that Joyce had verbally instructed the appellant to “reallocate funds”. Even if Joyce did give these instructions, the trial judge decided that this did not absolve the appellant from the offence of conspiracy to cheat as the appellant could not make out a defence of mistake since he had failed to act with due care and attention.

The appeal

The issues on appeal

12 This appeal was premised on the following few grounds. Firstly, the district judge erred in law and in fact in holding that DBS was induced by P64. Counsel for the appellant argued that the elements of s 420 of the Penal Code were not made out as none of the prosecution witnesses testified that they were induced by P64. It was further contended that there was a critical error contained therein, so serious that if spotted and acted upon, DBS would have asked for the correction of P64 and would not have disbursed the sum. Since DBS failed to do so, it could only mean that DBS did not rely on P64 at all. Further, the appellant asserted that the trial judge erred by not finding that the appellant could succeed on the defence of mistake. Secondly, the appellant contended that the district judge erred in law and fact by accepting the evidence of Cheong and Joyce while rejecting the evidence of the appellant. The third ground of appeal related to the actions of DBS. Essentially, the appellant contended that too much emphasis had been placed on P64 and the trial judge did not place enough emphasis on the fact that DBS had flouted and breached Economic Development Board guidelines, and that the loan application was made in breach of regulations. It was further submitted that the trial judge had not given due weight to the fact that DBS did not carry out its own due diligence to ascertain the veracity of the content contained in P64.

Whether the offence of cheating had been...