Regina v Thien [2009] SBHC 79; HCSI CRC 218 of 2009 (23 July 2009)

High Court of Solomon Islands
(Palmer CJ.)
Criminal Appeal Case Number 218 of 2009

Regina

v

Uhla Thien and Hisham Bin Abdullah

Hearing: 20th July 2009
Sentence: 23rd July 2009

Ms. Christensen and Mr. Talasasa (Jnr.) for the Comptroller of Customs
Mr. Marahare for the Defendants
Mr. Afeau on behalf of the owners, Lee Ling Shipping SDN. BHD. of the Vessel Lee Ling 8

Palmer CJ.

The defendants have pleaded guilty to the following charges under the Customs and Excise Act [Cap. 121] as follows:

Count 1: that on the 12th day of April, 2009 Uhla Thien did make and subscribe a false declaration contrary to section 212(a) of the Customs and Excise Act [Cap. 121] ("the Act");

Count 2: that on the 12th day of April 2009, Uhla Thien and Hisham Bin Abdullah were on board a ship in Solomon Islands having a disguised place adapted for concealing goods contrary to section 193(a) of the Act;

Count 3: that on the same day, both defendants imported the following concealed goods, 276 bottles of liquor, 2444 sleeves of cigarettes, food stuffs, one chainsaw and chainsaw parts, electrical equipment and items, suitcases, two generators, 29 watches and personal items contrary to section 214 of the Act; and

Count 4: that on the same day, both defendants did import into Solomon Islands prohibited goods, namely 22 indecent or obscene films, contrary to schedule 2 section 4 of the Act.

Brief facts

The defendant Uhla Thien ("Thien") from the Union of Myanmar is the captain of the tug boat Lee Ling 8 ("the Vessel"). Hasim Bin Abdullah ("Abdullah") is from Malaysia and is the Chief Operator of the Vessel.

The Vessel arrived in Honiara on 12 April 2009 from Malaysia. During the course of a routine customs inspection of the Vessel, customs officers detected a false wall in the Vessel and located a large quantity of cigarettes, alcohol, machinery, foodstuffs and sexual aids behind the wall in the crew's accommodation area. Thien did not declare those goods as unmanifested cargo when asked by the custom's officers. He actually denied knowledge of them. Abdullah on the other hand acknowledged being aware of the goods and explained that they belonged to Earthmovers Company and some company employees. He however sought to explain that they were put away in a concealed place to safeguard them from rough seas but then failed to declare them when asked.

After careful investigation the two defendants were charged with four counts under the Act.

A number of preliminary issues have been raised which I will now address. The first relates to the application of section 194 of the Act. It reads as follows:

"Every ship of less than two hundred and fifty tons burden on board which, or in respect of which any offence against section 193 has been committed shall be forfeited."

Counsel, Mr. Afeau for the Vessel's owner submits that this section should not be read as being mandatory. He says the forfeiture power should be viewed as the maximum penalty and that the court can impose any lesser penalty.

Ms. Christensen however argues that the provision is very clear, that it is not a penalty but a power to forfeit the Vessel. Parliament's intention in this instance is very clear and that the court should give effect to it.

The history of paragraph 193(a) of the Act can be traced back to section 228(6) of the Customs Act 1901[1]. That in turn can be traced to s. 179 of the Customs Consolidation Act, 1876 of the United Kingdom. Australia also has similar provisions which can be traced to section 44 of the New South Wales Customs Regulation Act, 1830[2] which in turn was copied from section 19 of the Act for Prevention of Smuggling, 1825[3] of the United Kingdom. The history of those legislations go back to earlier enactments which provide that ships engaged in smuggling were to be forfeited to the Crown.

Our law is drawn from that rich history of the development of British legislation.

A number of case authorities have been provided to me for my consideration by Ms. Christensen in this matter. I thank her for that.

The first case cited is De Keyzer v. The British Railway Traffic Electric Co Ltd[4] ("De Keyzer's Case"). That case involved the use of a motor tank wagon which was subject to forfeiture powers with very similar words used to the effect that such "...goods liable to forfeiture ...shall be forfeited." The issue raised in that case is similar to the argument raised by Mr. Afeau in this case regarding knowledge. Lord Hewart CJ. pointed out in his judgement that knowledge was irrelevant to the proceedings. Singleton J. also said the same thing that the section referred to "... infers a statutory forfeiture of the vehicle irrespective of the knowledge or consent of the owner thereof."

De Keyzer's case was also referred to in the case of Customs and Excise v. Air Canada[5] ("the Air Canada CAse") which I will refer to more in detail later.

The second case Seabata Koloti v. Rex (High Court of Lesotho CRI/A/43/91) is a case from Lesotho which involved the illegal importation of liquor and which had been seized. Although not directly on point the Court looked at the provisions that such liquor shall be liable to forfeiture and held that it was mandatory. That is actually similar to the provision in section 193 and other similar provisions to the Act though the phrase actually used in our legislation is much narrower "shall be forfeited".

The third case cited Re Whim Creek Consolidated NL v. Gregory Colgan and Collector of Customs[6], a case from the Federal Court of Australia also considered similar provisions under the Customs and Excise Act 1901 of the Commonwealth regarding seizure and forfeiture powers. It held that such powers occur consequent to the existence of the facts which justify a forfeiture, again supporting the contention of the Crown in this case that the forfeiture powers in relation to the Vessel are mandatory.

A case authority directly on point is the case of Customs and Excise Commissioners v. Air Canada[7]. The issue involved the power of the Commissioners of Customs and Excise to seize and forfeit a large commercial jet owned and operated by Air Canada, under sections 139(1) and 141(1) of the Customs and Excise Management Act 1979 on the ground that the aircraft had been "used for the carriage ... of [a] thing ... liable to forfeiture". A quantity of cannabis resin had been found in a container carried by the aircraft. At that time an aircraft was not excluded from being liable to be forfeited. Aircrafts were excluded it seems after as a result of the decision in that case.

Counsel for the airline argued in a very similar fashion to the arguments raised by Mr. Afeau in this case, inter alia, that the Commissioners needed to prove that the airline knew that a container of cannabis was on board the aircraft. In the court of first instance, the trial judge agreed with that submission that liability to forfeiture of an aircraft was not absolute, that the Commissioners had to prove that the airline knew or ought to have known that such goods were being carried on the aircraft.

On appeal to the Court of Appeal, the Court held inter alia that the provision in relation to forfeiture of the aircraft however large, was absolute and not dependent on proof of mens rea on the part of the owner or user of the aircraft. A number of reasons were given, of relevance, that (i) the proceedings under sections 141(1)(a) and 139(1) were proceedings in rem against the aircraft and therefore operated wholly independently of any knowledge, motive or attitude of the owner or user of the aircraft and (ii) that the meaning of those words were clear and unambiguous and did not require the implication of mens rea or knowledge on the part of the owner or user of the aircraft.

In his judgement, Lord Justice Purchas referred to a number of case authorities. One of these was Lord Advocate v. Crookshanks[8] which concerned the seizure of a cab and a horse which had been used to carry prohibited goods, tobacco. The words of the statute provided inter alia that all carriages and horses used shall be forfeited. Lord President Inglis, referring to the words of the statute states:

"Now, these words admit of no construction but one. If certain things, - among others cabs and horses, - are used to convey uncustomed goods, the statute provides that they shall be forfeited. It is not necessary to make any allegation against any person to the effect that he has committed an illegal act. The mere fact that the cab and the horse have been used in the particular manner referred to in the statute is a sufficient ground for forfeiture....

... Most of these case(s) have to do with the particular words of the statutes under which the proceedings are taken. Some of these require guilty knowledge, others do not. Here the penalty follows on the fact that the goods have been used in a particular way, and no question of innocence on the part of anyone arises."

After a meticulous review of the submissions of counsels, Lord Purchas pointed out that those provisions provided a process in rem against any vehicle, container or article used in the process of smuggling liable to forfeiture. He pointed out that the object to be forfeited under the provisions was incapable of motive or state of mind, thus the confiscatory provisions operated against the thing and wholly independent of the knowledge, motive or attitude of owners associated with the thing.

Subsequent cases[9] have followed that decision and reiterated the point that knowledge was irrelevant in such circumstances. The second set of authorities[10] provided by Ms. Christensen on the issue of irrelevancy of knowledge, motive or attitude are also directly on point. Para. 1154 of Halsbury's Laws of England (ibid) at note 6 reiterates the position taken in the Air Canada Case that the liability to forfeiture powers provided for in section 141(1)(a) of the Customs and Excise Acts 1979 is absolute.

Those case authorities and the plain, clear and unambiguous meaning of section 194, make plain that there can be no other construction to be imputed to that section. The plain literal meaning of section 194 is crystal clear and the words used, which I might add are even more narrower, "shall be forfeited" are capable of only one construction; that the power envisaged is mandatory; it leaves no room for any discretion. The power of forfeiture is absolute and does not depend on proof of mens rea to be established. Knowledge, motive or attitude is irrelevant. To use the expression of his Honour Fox J. in Pearce v. Button[11], the power of forfeiture follows directly from the existence of facts falling within section 193 of the Act and does not require any further decision to be taken.

Secondly, the provision is a process in rem directed against the Vessel and so the forfeiture powers to be exercised operate against the Vessel independent of any knowledge, motive or attitude of the owner or user of the Vessel. This is to be contrasted to an action in personam directed against the master or owner of the Vessel which may require knowledge or motive and would stipulate a maximum penalty. Forfeiture of the Vessel follows automatically from an offence committed in section 193 of the Act; section 194 confers a statutory forfeiture of the Vessel irrespective of the knowledge or consent of the owner.

In his submissions against forfeiture of the Vessel, Mr. Marahare submits that when assessing the total tonnage of the Vessel, the barge, Lee Ling 9, which it was towing at that time should also be taken into account. If that was the case, the total tonnage would be more than 250 tons burden and bring the Vessel within the provisions of section 195 which would mean that the Vessel instead of being forfeited would only incur a monetary penalty. Attractive though the argument may be, these are two separate vessels with separate identities and are severable; one is a tug boat, the other a barge. The offences were committed on board the tug boat and not the barge. I reject that argument.

There is no issue raised regarding the calculation of the tonnage of the Vessel. Section 2(1) of the Act defines the "burden" as net registered tonnage. The net tonnage of the Vessel is 77 tons and falls squarely within the provisions of section 194 of the Act.

Mr. Afeau refers to section 271 of the Act to submit that forfeiture powers are not mandatory. I think that is putting the cart before the horse. Forfeiture powers are mandatory in this instance, what happens thereafter is a matter between the Comptroller and the owner of the Vessel as to any settlements or agreement that may be reached.

Issues of hardship do not form part of the argument whether forfeiture powers should be exercised or not in this instance.

Another minor preliminary matter touched upon in submissions relates to the suggestion that the penalties imposed under the Act are mandatory penalties. I was referred to the case of Regina v. Rang[12] in which the court held that the penalties stipulated in the Act, whether it relates to a specific amount or treble the value of the goods are not to be construed as mandatory. Section 2(2) of the Act puts this question beyond doubt that it is to be construed as stipulating the maximum and any lesser penalty may be imposed.

Another minor matter raised was the issue whether the court had power in the circumstances of this case to impose a custodial sentence apart from a fine. Section 254 of the Act, in my view answers that query in an indirect way, by expressly stating that imprisonment of not more than 12 months may be imposed for a second time offender. It seems to me that the Act does not envisage in the first instance that a first offender would be immediately sent to prison unless proof of a second offence. The above provisions do not provide for a penalty of imprisonment as an alternative in the first instance. The question of a custodial sentence as a penalty in this case therefore where the defendants are first offenders therefore is not open to me. The court however may impose an alternative sentence in default of payment of the penalty adjudged to be paid (section 253).

The case of Regina v. Rang[13] has been referred to in mitigating sentence for the defendants by Mr. Marahare. That case in my view is distinguishable in its facts. That involved the captains of fishing boats licensed to fish in Solomon Islands and were found to be in breach of various conditions set out in their permits and of the Fisheries laws and Customs and Excise Act. The Government was willing to give them a second chance and apart from the penalties imposed, the proceeds of sale of fish totalling $478,094.99 were also directed to be paid to the Government.

The facts in this case are quite different. They entail the concealing of goods which ought to have been declared in a disguised place under the Act.

I give credit for your guilty pleas. That has saved the court and the parties in this case unnecessary costs and time. I give credit that this is your first time to be before the courts in this country and that you cooperated well with Customs Officers and the Police in respect of these matters.

I also note from the facts that some of the goods concealed may have been intended for others and possibly you may have been acting on instructions from others and even may not have any vested interest in those goods. However as the Master and Chief Operator you are directly responsible for that ship and everything carried in it. The law requires that you must declare such goods for purposes of import duties.

On the subject of bringing prohibited goods, being indecent or obscene films again you are well aware of that prohibition under the laws of this nation.

I must balance your mitigating factors with the fact that these offences were blatant breaches of the Act. You are experienced seamen; this is not your first time to travel to Solomon Islands. For you, Abdullah the facts indicate that you have been to the country about nine times; for you Thien, this is your second time. You would have been well aware therefore of the requirements of the Customs laws of this country. Every country, including your own have their own laws, which seek to prevent this type of offence being committed. The purpose for which this type of law has been enacted is to stop people from bringing in goods without paying the necessary charges to the Government; put in another way it is to stop people stealing money from the Government.

Solomon Islands is a developing nation, it has been classified as a third world country. While it is not a poor nation, it is very dependent to a large extent on assistance it can receive from other aid donors to run its services and for development. It definitely needs all the money it can get whether from import or export duties. Your actions have deprived the people of this nation of vital moneys that it needs to runs its services etc.

In my view the element of public deterrence must be taken into account in the penalty that is to be imposed. Those who seek to disregard the Customs laws of this country must expect a heavy financial penalty where that is available, and imprisonment where applicable. The message that must be sent out loud and clear is that it is not worth the risk of trying to evade the payment of import duties. If it is prohibited do not bring it in, if it is illegal do not do it.

I note the Comptroller of Customs has made an election of treble the value of the goods in respect of the offences committed under sections 213 and 214 of the Act.

Accordingly I convict you both of the offences set out in counts 1 – 4 and impose penalties as follows:

In respect of Uhla Thien, for count 1, the maximum penalty provided for is $1,000.00. Taking into account your guilty plea and being a first offender I will deduct 20% from the maximum penalty of $1,000.00 and impose a penalty of $800.00.

In respect of the joint charges in count 2, I impose the maximum penalty of $200.00 and order that all the goods be forfeited.

In respect of count 3, the total value of the goods concealed comes to $279,085.00, less the prohibited goods being valued at $817.00 that comes to $278,268.00. No issue has been raised regarding the calculations made by the Comptroller and submitted to the Court. The value of the goods when trebled comes to a total of $834,804.00. Giving credit for the guilty plea and the fact that they are first offenders and for cooperating with Customs Officers and the Police, I deduct 25% from this, which comes to $626,103.00. I impose this penalty.

In respect of count 4, the value of the prohibited goods comes to $817.00, treble that comes to $2,451.00. I impose that penalty and order that they be forfeited and to be destroyed forthwith. I note the particulars states 22 indecent or obscene films, while the list of exhibits refers to 24 CDs and DVDs, this is a matter which Ms. Christensen can take up with the Comptroller to get the details correct.

The total penalty for each defendant therefore is as follows:

(i) Uhla Thien: $629,554.00 payable in 30 days in default 12 months imprisonment;
(ii) Hisham Bin Abdullah: $628,754.00 payable in 30 days in default 12 months imprisonment.

Finally, under section 194, I order that the Vessel (the Lee Ling 8) be forfeited to the Government forthwith.

ORDERS OF THE COURT;

1. Convict both defendants of the offences they have been charged with under counts 1 – 4.
2. Impose penalties as follows:
   
   • (i) Count 1: Impose against Uhla Thien a penalty of $800.00;
     
   • (ii) Count 2: Impose against both defendants (Uhla Thien and Hashim Bin Abdullah) a penalty of $200.00 each and order that all the goods be forfeited to the Government;
     
   • (iii) Count 3: Impose against both defendants a penalty of $626,103.00 each;
     
   • (iv) Count 4: Impose against both defendants a penalty of $2,451.00 each and order that the CDs and DVDS be forfeited and to be destroyed forthwith.
     
3. The total penalty imposed for each defendant is as follows:
   
   • (i) Uhla Thien: the amount of $629,554.00 payable in 30 days in default 12 months imprisonment;
     
   • (ii) Hashim Bin Abdullah: the amount of $628,754.00 payable in 30 days in default 12 months imprisonment.
     
4. Order forfeiture of the tug boat Lee Ling 8 to the Government forthwith.
   

The Court.

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^[1] See Scott v. James Patrick & Co Pty Ltd [1968] HCA 28 per Windeyer J at para. 13
^[2] 11 Geo. IV No. 6
^[3] 6 Geo. IVc. 108
^[4] [1936] 1 KB 224 per Lord Hewart CJ
^[5] [1991] 1 All E. R. 570, CA
^[6] [1991] FCA 467 at pp 8, 10
^[7] [1991] 1 All E.R. 570, CA
^[8] (1888) 15 R 995
^[9] De Keyser v. British Railway Traffic and Electric Co Ltd [1936] 1 KB 224 per Lord Hewart CJ at 230
^[10] Cheatley v. R [1972] HCA 63; The State v. Hui and Waikava Marine Industries Ltd (High Court of Fiji, HAC 40 of 2004); Halsbury’s Laws of England (1990) Vol. 11(2) at para. 1327; Halsbury’s Laws of England (1999) Volume 12(2) at para. 1154.
^[11] (1986) 65 A.L.R 83
^[12] [1995] SBHC 12, 2^nd June 1995
^[13] (ibid)