Tan Tze Chye v Public Prosecutor

• Jurisdiction: Singapore
• Judge: Yong Pung How CJ
• Judgment Date: 08 May 1997
• Neutral Citation: [1997] SGHC 120
• Citation: [1997] SGHC 120
• Defendant Counsel: R Palakrishnan and Dominic Nagulendran (Palakrishnan and Partners),Muhd Hidhir (Deputy Public Prosecutor)
• Published date: 19 September 2003
• Date: 08 May 1997
• Docket Number: Criminal Motion No 8 of 1997 (Magistrate's
• Court: High Court (Singapore)
• Subject Matter: Adducing fresh evidence,Director paying himself for work already within the scope of his duties,Whether there was misappropriation,ss 23, 24, 409 Penal Code (Cap 224),Whether the misappropriation was dishonest,Criminal Misappropriation of Property,Principles applicable,s 257 Criminal Procedure Code (Cap 68),Criminal Procedure and Sentencing,Appeal,Criminal Law,Criminal Breach of Trust,Dishonesty,Property

The appellant was tried and convicted by a district judge on the following two charges of criminal breach of trust:

You,

Tan Tze Chye, M/45 yrs

NRIC No: 0007009B

1st Charge: are charged that you, on or about 7 July 1993 at 9 Battery Road, #09-08/10, Straits Trading Building, Singapore, being an agent, to wit, a director of Vigers Singapore Pte Ltd and in such capacity being entrusted with property, to wit, funds belonging to Vigers Singapore Pte Ltd, committed criminal breach of trust by dishonestly misappropriating $500 in respect of the said property, and you have thereby committed an offence punishable under s 409 of the Penal Code (Cap 224).

You,

Tan Tze Chye, M/45 yrs

NRIC No: 0007009B

2nd Charge: are charged that you, on or about 9 December 1993 at 9 Battery Road, #09-08/10, Straits Trading Building, Singapore, being an agent, to wit, a director of Vigers Singapore Pte Ltd and in such capacity being entrusted with property, to wit, funds belonging to Vigers Singapore Pte Ltd, committed criminal breach of trust by dishonestly misappropriating $1,000 in respect of the said property, and you have thereby committed an offence punishable under s 409 of the Penal Code (Cap 224).

He was sentenced to three weeks` imprisonment on the first charge and to three months` imprisonment on the second charge. Both terms were ordered to run concurrently. The appellant appealed against both his conviction and sentence. I heard his appeal on both charges, on 15 April 1997. After listening to arguments by counsel for the appellant, I dismissed the appeal. I now give my reasons.

The agreed statement of facts

The prosecution and the defence agreed on a statement of facts at the trial below, as set out hereafter. On 15 June 1993, the appellant was appointed as the managing director (MD) of Vigers Singapore. Sloan Management Services (Sloan) was registered as a business on 26 May 1991 and was at all times a sole proprietorship in the appellant`s wife`s name. Sloan was in fact, managed by the appellant.

The appellant`s brother, one Georges Tan Choo Hock (Georges), was in 1993 the managing partner of Resource Pool Business Services (RPBS), which provided consultancy business services.

Georges sent an RPBS invoice dated 2 July 1993 to Vigers Singapore for $500, for `company secretarial services rendered for the period from April 1993 to June 1993`. On or about 7 July 1993, the appellant issued a cheque dated the same day for $500 drawn on Vigers Singapore`s account to RPBS.

Georges sent a second RPBS invoice dated 2 December 1993 to Vigers Singapore for $1,000 for `company secretarial services rendered for the period from 1 June 1993 to 31 December 1993`. On or about 9 December 1993, the appellant issued a cheque dated 9 December 1993 for $1,000 drawn on Vigers Singapore`s account, again to RPBS.

Subsequently, Sloan issued an invoice to RPBS dated 5 December 1993 for $1,350 for `consultancy services rendered for the three quarters ended 31 December 1993`. On 6 January 1994, Georges issued a cheque for $1,350 drawn on the account of RPBS to Sloan

The background

In 1992, one Lee Zee Ming (Lee) and the appellant approached Tan Kim Lee (Tan), the former MD of Vigers Singapore to purchase all of his 62% shareholding in the company. The price offered for Tan`s shares was $170,000. After negotiations, Lee and the appellant entered into a sale and purchase agreement dated 25 February 1993, with Tan, Vigers Asia (Holdings) Ltd of Hong Kong and Vigers Singapore, for the sale of shares, to be transferred on 15 April 1993.

The arrangement

Subsequently, the appellant and Lee had a few meetings with Tan. According to the appellant and Tan, both the appellant and Lee had complained that the secretarial fees charged by Lim and Associates, a secretarial firm, were excessive. Lee, however, maintained that he did not look at the January or February 1993 management accounts of the company and therefore, he did not know that Vigers Singapore was paying Lim and Associates $4,000 for nine months` secretarial work and therefore denied ever complaining about the fees.

According to the appellant, Lee had wanted an arrangement for cheaper secretarial fees. The appellant had experience in company secretarial work. The appellant maintained that he told Lee that he would do the company secretarial work at around half the cost. However, at that time, the appellant was in employment elsewhere, as company secretary at Chemical Industries. As such, according to the appellant, he could not be the company secretary, since he could not be an employee of two different companies. It appeared however, that the appellant was involved in Sloan at the same time as he was secretary of Chemical Industries. The appellant explained this by saying that `Sloan was a $2 paid up company and was dormant`. In any event, the appellant maintained that he told Lee that he would get his brother`s firm RPSB to provide a named company secretary and then RPSB could bill Vigers Singapore. Lee however denied all of this.

The appellant`s brother, Georges, testified that in March 1993 the appellant approached him and proposed that RPBS be appointed the company secretary of Vigers Singapore; that `RPBS would not perform all the secretarial services`; that RPBS provide the registered address of Vigers Singapore and that RPBS provide a named company secretary. According to Georges, he would normally have given the secretarial services to the affiliate company of RPBS. However, at the appellant`s request, RPBS agreed to sub-contract the company secretarial services to Sloan. RPBS was to retain $200 as consideration for providing the office address and naming the company secretary.

Therefore, in fact, the appellant was being paid for his secretarial services through RPBS as a sub-contractor. The appellant maintained that the $500 paid for secretarial services for April and June 1993 was for the period when the appellant was not a shareholder of the company and was not receiving remuneration at all as employee or officer of Vigers Singapore. There was no agreement between the appellant and Lee that he was going to do the secretarial work for free.

As for the $1,000 for secretarial services from June to December 1993, the appellant maintained that he was not responsible `for the actual corporate secretarial work like preparing the resolutions, lodging of ROC forms and the updating of company records`. As he had done such work without being responsible for them, the appellant therefore felt that he just `received a percentage of what RPBS got`.

The appellant agreed however that, after he became Vigers Singapore`s director, no resolution was passed to approve the arrangement whereby he would do Vigers Singapore`s secretarial work which RPBS had contracted to Sloan and he would bill RPBS through Sloan.

According to Lee, the appellant and himself had a verbal agreement after signing the agreement of 25 February 1993 as to their defined areas of responsibilities and the demarcation of their roles and duties. Lee knew that the appellant was a Fellow of the Chartered Institute of Secretaries and a Certified Public Accountant and he had been the group company secretary of two large publicly listed companies. Therefore, it was verbally agreed that, by the time they became directors of Vigers Singapore, the appellant would be given the responsibilities for company secretarial work, accounts matters, administration and estate agency.

Lee agreed that there was no discussion that the appellant would do secretarial work for free in April and June 1993. However, by 25 February 1993, it was already decided that the appellant would be shareholder and director of Vigers Singapore and therefore he had a vested interest in the company. There was no discussion that the appellant would be separately paid for his secretarial work. Lee maintained that the appellant`s high pay already included payment for secretarial work.

The directors` resolution

There was a directors` resolution dated 1 April 1993. In this resolution, one Chin Yan Kee (Chin) was appointed as the new company secretary and the address of the registered office was changed from the address of Lim and Associates to that of RPBS, the appellant`s brother`s firm. Lee denied that this resolution was the result of discussions he and the appellant had with Tan in March 1993. Although Lee signed the resolution, he maintained that the appellant had given him a stack of documents and he had signed it without looking at its contents, because the appellant was then doing the secretarial work of Vigers Singapore and he trusted the appellant. It was undisputed that Lee did not know Chin. Therefore, Lee testified that he would not have approved Chin`s nomination, if he had been aware of it, since his post involved dealing with confidential matters of the company.

`Concealment` of the secretarial fees

Francis Lee (Francis) kept and maintained Vigers Singapore`s accounting records and prepared its financial statements and management accounts. Francis did not discuss with or report to Lee on the accounts; he reported directly to the appellant. Lee always left the accounting matters to the appellant.

Francis had testified that in March 1994 he had seen the appellant with the draft management accounts, which included the profit and loss accounts for the period from 1 July 1993 to 28 February 1994. The appellant had instructed Francis to reclassify the sum for secretarial expenses under general expenses. He had also instructed Francis to separate the entertainment and refreshment accounts.

According to Francis, `General expenses actually is a dummy account usually including expenses paid out in small amounts or are not incurred frequently`. A person looking at the item would not know what the expenses included under general expenses were, unless he referred to the records or asked Francis about the details....