PP v Takaaki Masui

• Jurisdiction: Singapore
• Judge: Sundaresh Menon CJ,Tay Yong Kwang JCA,Steven Chong JCA
• Judgment Date: 30 December 2021
• Court: Court of Three Judges (Singapore)
• Docket Number: Criminal Reference No 3 of 2020 and Criminal Motions Nos 1 and 2 of 2021

Public Prosecutor

and

Takaaki Masui and another and other matters

[2021] SGCA 119

Sundaresh Menon CJ, Tay Yong Kwang JCA and Steven Chong JCA

Criminal Reference No 3 of 2020 and Criminal Motions Nos 1 and 2 of 2021

Court of Appeal

Criminal Procedure and Sentencing — Criminal references — High Court upholding two offenders' convictions for conspiring with each other to corruptly obtain gratification — Offenders seeking leave to refer questions to Court of Appeal — Whether questions were questions of law of public interest — Whether questions arose for High Court's determination — Whether determination of questions would have affected outcome of case

Criminal Procedure and Sentencing — Sentencing — Penalties — Co-offenders corruptly receiving money gratification from sole proprietor — Co-offender transferring sum of money to sole proprietor while corrupt scheme underway — Authorities recovering sums of money from co-offender's bank accounts — Co-offenders paying principal settlement sum of $200,000 — Whether various sums of money disgorged from co-offenders — Whether various sums of money to be deducted from penalties imposed — Section 13 Prevention of Corruption Act (Cap 241, 1993 Rev Ed)

Held, dismissing CM 1 and CM 2, reframing the question raised in CRF 3 and answering the reframed question in the negative:

The Court's decision on CM 1 and CM 2

(1) The Gratification Question was a question of fact. It was also not a question of law of public interest as it could be resolved by applying established legal principles. Moreover, although Ishibe's counsel argued that the relevant gratification was not Koh's payments to Masui and Ishibe but the services rendered by Koh to them, this distinction would not have affected the outcome of the case: at [32] to [34] and [36].

(2) The Act Question could not be entertained as it challenged the Judge's factual finding that the profit-sharing arrangement was objectively corrupt. It was also a purely hypothetical question that could not have affected the outcome of the case: at [40] and [41].

(3) The Reasonable Basis Question did not arise for determination by the High Court and was not a question of public interest. The determination of that question would also not have affected the outcome of the case. Furthermore, the Reasonable Basis Question was, in substance, a backdoor appeal against the Judge's factual finding that Koh's payments to Masui and Ishibe were objectively corrupt inducements: at [44] to [47].

(4) Whether and the extent to which the High Court, in its appellate capacity, had a duty to give reasons was an inherently factual inquiry. Judges were not obliged to respond to every argument point by point. In dismissing an appeal, a judge was not required to provide independent reasons, to address the specific grounds raised in the petition of appeal or to reprise the trial judge's reasons: at [49] and [50].

(5) The Reasons Questions were questions of fact and, in any event, were not questions of public interest. Moreover, the Reasons Questions raised in CM 2 did not arise for determination by the High Court, and their determination would have had no bearing on the outcome of the case: at [49] to [52].

(6) The Court thus dismissed CM 1 and CM 2. As these applications were backdoor appeals that had been brought in abuse of process, Ishibe and Masui were each ordered to pay costs of $2,000 to the Prosecution: at [2], [58], [61] and [62].

The Court's decision on CRF 3

(7) Although the Court agreed to answer the question raised in CRF 3, it reframed the question as follows: “Where the gratification is a sum of money, must the court order the recipient to pay a penalty under s 13 of the Prevention of Corruption Act (Cap 241, 1993 Rev Ed) of a sum equivalent to the amount of money received by him, if (a) he has returned or repaid all or part of the sum of money; and/or (b) all or part of the sum of money has been disgorged from him, whether voluntarily or otherwise?” (“the Referred Question”): at [71].

(8) The ordinary meaning of s 13(1) of the PCA was as follows: as long as the gratification was a sum of money or of a value that could be assessed, the court had to order the recipient to pay a penalty of a sum equal to the amount of that gratification or a sum that was, in its opinion, the value of that gratification. This meant that where the gratification was a sum of money, but all or part of it had been repaid or disgorged, the court ought to impose a penalty of a sum that reflected the value of the gratification retained by the recipient: at [83], [87] and [95].

(9) The phrase “if that gratification is a sum of money or if the value of that gratification can be assessed”, as used in s 13(1) of the PCA, was intended to ensure that the gratification was quantifiable for the purposes of imposing a penalty. It would be unprincipled if the court could value non-monetary gratification, but not money gratification that had been repaid, returned or disgorged: at [83], [85] and [86].

(10) The legislative purpose of s 13(1) of the PCA was not to impose an additional layer of punishment, but to prevent corrupt recipients from retaining their ill-gotten gains: at [85], [91], [92], [107], [116] and [140].

(11) Among the interests of the State, the giver, the recipient and the principal, the principal's interest in recovery assumed primacy. Since the principal had the most compelling claim to the gratification sum, the law ought to incentivise repayment to him. As against the Prosecution's interpretation of s 13(1) of the PCA, the Court's purposive interpretation of that provision better vindicated the principal's interest: at [106], [109], [112], [117] and [122].

(12) The Prosecution's interpretation of s 13(1) of the PCA would not only discourage a recipient from purging his wrongdoing by voluntarily returning the gratification sum to the principal, but would also penalise such a recipient by rendering him liable to pay a penalty for the full amount of the gratification nonetheless. Moreover, on the Prosecution's construction, a recipient who voluntarily repaid or surrendered the gratification sum to the principal would, perversely, be worse off than one who did not do so: at [93], [96], [110] and [112].

(13) Where the authorities had disgorged the gratification sum in full, the court ought to: (a) order that the disgorged sum be forfeited to the State, without imposing a penalty; or (b) impose a penalty for the full gratification sum but order that the penalty be paid out of the disgorged moneys. The court ought to also impose a penalty equivalent to the value of the recipient's ability to use the gratification sum from the time of receipt to the time of disgorgement, to account for the benefit that the recipient would have had: at [119].

(14) Where the authorities had disgorged the gratification sum only in part, the court ought to: (a) impose a penalty in respect of the balance amount; or (b) impose a penalty in respect of the entire gratification sum but order that the disgorged moneys be applied towards part payment of the penalty. The court ought to additionally impose a penalty equivalent to the value of the recipient's ability to use the disgorged sum from the time of receipt to the time of disgorgement: at [121].

(15) Where the principal had recovered the gratification sum from the recipient, whether in whole or in part, the court ordinarily ought to deduct the repaid amount from the penalty imposed. However, even if the principal had fully recovered the gratification sum from the recipient, the latter would still be liable to pay a penalty of an amount that represented the value of his ability to use the gratification sum from the time of receipt to the time of repayment: at [122].

(16) The relevant cut-off point when examining if any part of the gratification sum had been repaid or disgorged was the time at which the penalty was first imposed, whether at trial or on appeal: at [127] and [132].

(17) Where the recipient had returned the gratification sum to the principal in full before a penalty was imposed, the gratification would be disgorged on a 100% basis. In so holding, the Court departed from the decision in Leong Wai Kay v Carrefour Singapore Pte Ltd[2007] 3 SLR(R) 78, which suggested that such a recipient would be liable to double disgorgement. Only in cases where a penalty was imposed before the principal recovered the gratification sum would disgorgement be on a 200% basis: at [125], [126] and [140].

(18) The recipient ought to repay the principal promptly or he would assume the risk of double disgorgement: at [130].

(19) The Court therefore answered the Referred Question in the negative, although the quantification of the penalty imposed under s 13(1) of the PCA would depend on the precise circumstances of the repayment or disgorgement: at [139] and [148].

(20) The sum of $200,000 paid by Ishibe and Masui to the Singaporean Company in full and final settlement of the judgment sum awarded by a Japanese civil court against them ought to be deducted from the penalties imposed: at [142] and [143].

(21) Since Masui and Ishibe effectively retained the benefit of the sum of US$240,000 that Masui had paid to Koh in June 2005, that sum ought not to be deducted from the penalties imposed. As for the sums recovered by the authorities from Masui's frozen bank accounts, they ought not to be deducted from the penalties as the Judge had ordered that they be applied towards payment of the penalties: at [144] and [145].

(22) The Court accordingly reduced the penalty imposed on Masui and Ishibe each to $904,716.50. Taking into account the reduced aggregate sum of $1,105,660.50 (comprising the fine of $200,944 and the reduced penalty of $904,716.50) payable by Masui and Ishibe each, the Court reduced the default sentence to 11 months' imprisonment: at [146], [147] and [149].

[Observation: The Court did not endorse the Judge's sentencing framework for...