Public Prosecutor v Koh Beng Oon

• Jurisdiction: Singapore
• Judge: Yong Pung How CJ
• Judgment Date: 01 December 2000
• Neutral Citation: [2000] SGHC 262
• Docket Number: Magistrate's Appeal No 78 of 2000
• Date: 01 December 2000
• Year: 2000
• Published date: 19 September 2003
• Plaintiff Counsel: Wong Keen Onn, Ivan Chua Boon Chwee and Tai Wei Shyong (Deputy Public Prosecutor)
• Citation: [2000] SGHC 262
• Defendant Counsel: Kasiviswanathan Shanmugam SC, Tan Chuan Thye and K Muralidharan Pillai (Allen & Gledhill)
• Court: High Court (Singapore)
• Subject Matter: Property offences,Pledges and pawns,Offences,Credit and Security,Contract,ss 3 & 94 Evidence Act,Whether pledge for contingent debt possible,Parol evidence,Criminal Law,s 409 Penal Code,Contractual terms,Criminal breach of trust -Whether sub-pledging of vehicle documents amount to misappropriation,Whether contemplation of parties should be considered,Whether terms of pledge prohibit sub-pledge

: This was an appeal against the decision of district judge Siva Shanmugam, where he acquitted the respondent, Koh Beng Oon (`Mr Koh`), of 12 charges of criminal breach of trust. The 12 charges are similar to one another. The first of them reads:

You, Koh Beng Oon, are charged that you, between 5 July 1999 and 7 July 1999, in Singapore, committed criminal breach of trust, in that you, whilst being the Managing Director of Auto Asia (S) Pte Ltd (`the Company`), and in the way of your business as an agent of the company being entrusted with dominion over property, namely, Preferential Additional Registration Fee Certificate for vehicle number SBH 1295T belonging to one Lie Halim@Freddy Tjoe, did dishonestly misappropriate the said property and you have thereby committed an offence punishable under s 409 of the Penal Code (Cap 224, 1985 Ed).

The facts

Mr Koh was the managing director of Auto Asia (S) Pte Ltd (`Auto Asia`). The company was incorporated on 2 April 1991 and was involved in the business of selling cars. Mr Koh was the majority shareholder, holding 600,000 shares in the company. The remaining 450,000 shares were held by his wife, Mdm Constance Tan Gek Suan.

Sometime in early 1998, Auto Asia secured the exclusive right to sell Kia cars in Singapore. Actual sales began sometime around June 1998, and Auto Asia managed to sell about 130 cars by year-end. In January 1999, Auto Asia launched a sales promotion for Kia Mentor cars, priced at $59,900, inclusive of the Certificate of Entitlement (`COE`). The COE price for the relevant category of vehicle at that time was $34,508. A second promotion for Kia Mentor cars was launched in March 1999, at the price of $66,800.

A large number of orders were received pursuant to the promotions. All customers who placed an order with Auto Asia were required to pay a booking fee of $2,000 and a COE deposit of $8,000. Among these customers, were the 12 named in the charges. They did not pay the full $10,000 in cash. Instead, they made a cash payment of between $2,000 to $5,000 for the booking fee and as partial payment for the COE deposit, and in addition, deposited either the log-card or the Preferential Additional Registration Fee (`PARF`) certificate for their existing vehicle with Auto Asia. The log-cards and PARF certificates will be referred to collectively as `the vehicle documents`. Each of these 12 customers signed the following form (`the form`):

Re: Pledge of Vehicle Log-Card/Parf Cert as Part Payment for COE Bidding Deposit

I, [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar], NRIC No [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] of [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] confirmed and agreed to pledge my used car/PARF cert number [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] log-card/PARF cert, NRIC, transfer and early settlement forms duly signed with AUTO ASIA (S) Pte Ltd as part of the COE deposit for the purchase of [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] unit of [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] under vehicle order agreement no. [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] for name [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] NRIC No [lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar][lowbar] Upon successful COE bidding and time of registration, I shall allow Auto Asia (S) Pte Ltd to sell or scrap my car/PARF cert and to redeem the amount they have paid for the COE bidding. Also, I must settle all the balance payment before registration of the new vehicle. Failure to this Auto Asia (S) Pte Ltd have all rights to sell or scrap my car and to claim the difference on the full COE amount bidded and other miscellaneous cost incurred for the COE bidding and booking fee will be non-refundable. [NB: Original form was drafted in full caps.]

The COE bidding process mentioned in the form, was introduced in May 1990 as a means of controlling the growth of vehicle population in Singapore. Under the COE system, a COE must be obtained through a process of competitive bidding before a vehicle can be registered. When making a bid, 50% of the bid amount is deducted from the applicant`s bank account as deposit for the application. This deposit is refunded if the bid is unsuccessful. The bidding is usually conducted by the Land Transport Authority (`LTA`) from the 1st to the 7th of each month. Bidding usually closes at 4pm on the 7th of the same month, whereupon the LTA will announce the lowest successful bid for each category. A successful bidder needs only pay the lowest successful price (`strike price`), and not the amount that was actually bid.

Auto Asia`s practice was to secure the COE for its customers, either by bidding for it on its own or through an agent. This required Auto Asia to pay the required COE deposit to the LTA. Auto Asia had since July 1994, obtained a COE financing facility from a finance company called DP Financial Associates Pte Ltd (`DP`). DP was the sole managing agent for Hitachi Leasing (S) Pte Ltd (`Hitachi Leasing`) in relation to loans provided by Hitachi Leasing. Under the facility, Auto Asia would submit a list of customers to DP for whom COEs were required, and Hitachi Leasing would extend the necessary funding for the COE deposits through DP.

Sometime in early July 1999, Mr Koh submitted to DP a list of 120 customers who needed COE bidding. The total amount of credit required for the bidding was $3,010,050. DP was initially willing to extend only $775,000. When Mr Koh asked DP for additional financing, they replied that they would do so only if Mr Koh could provide some security.

Consequently, on 5 July 1999, Mr Koh delivered to DP ten vehicle documents. Eight of these documents belonged to persons named in the charges. On the security of these documents, DP sent Mr Koh a cheque for $141,600 on 6 July 1999 made out in Mr Koh`s name.

On 7 July 1999, Mr Koh delivered another six vehicle documents to DP. Four of these documents belonged to persons named in the charges. DP granted further credit of $80,000 to Auto Asia on the security of these documents. Mr Koh requested DP to use this $80,000 to finance COE bidding for three persons.

In the July 1999 COE bidding exercise, DP bid for 58 COEs on behalf of Auto Asia at the bid price of $50,000. The strike price for that bidding exercise was $45,876. On 15 July 1999, the LTA issued 58 temporary COEs to DP. Auto Asia was unable to redeem the COEs from DP due to insufficient funds. Auto Asia has since August 1999, entered into receivership.

The prosecution brought forth 32 charges of criminal breach of trust and 15 charges of cheating against Mr Koh. At the trial, the prosecution proceeded with 12 charges of criminal breach of trust. The remaining charges were stood down pending the outcome of the trial.

Decision of the judge

At the end of the prosecution`s case, the judge found that a prima facie case had been made out in respect of all the charges, and called for the defence. Mr Koh elected not to give any evidence and did not call for any witnesses.

The judge found that the vehicle documents had been pledged and...