Attorney-General v Naidu [2000] TOSC 34; C 0418 1999 (29 August 2000)

IN THE SUPREME COURT OF TONGA
CIVIL JURISDICTION
NUKU’ALOFA REGISTRY

NO.C.418/1999

BETWEEN:

HON. ATTORNEY GENERAL
Plaintiff

AND:

SURENDRA NAIDU
Defendant

BEFORE THE HON. JUSTICE FORD

Counsel: Mr Havea for the Crown and
Mr 'Etika for the accused

Dates of hearing: 25, 28 and 29 August, 2000
Date of judgment: 29 August, 2000

ORAL JUDGMENT

In about October 1996 the accused Surendra Naidu, who is a Fijian, and Sione Kiteau Topui agreed to establish a hardware business in Nuku'alofa under the name South Pac Builders Supplies Limited. At that stage the accused and Mr Topui were very close friends. The accused, for a period, lived upstairs in Mr Topui's house at Sopu. The accused had had a background in hardware. He had come to Tonga from Fiji in March 1991 and worked as a hardware manager for Morris Hedstroms Tonga Ltd. Mr Topui had had considerable experience in the construction business.

One of the immediate matters that needed to be attended to was for the accused to obtain a Tongan work permit. He made application for one from the Immigration Department and in support of his application he filed an employment contract which he had prepared. The contract (exhibit 2) was dated 3 October 1996. It was signed by the accused as "the employee" and by Mr Topui on behalf of South Pac Builders Supplies Limited as chairman of the company. Both signatures were witnessed by Mr Topui's daughter, Pilisita Topui.

Mr Topui had queried the salary figure in the contract of $30,000 per annum because he thought it was too high but the accused told him that that was the salary in his previous employment with Morris Hedstroms and so Mr Topui accepted the figure. Next morning the accused and Mr Topui took the contract along to the Immigration Department and left it there to be processed. The accused's work permit was eventually issued and it was for a two-year period instead of the five years applied for. The hardware business eventually started operations in about October 1997.

The accused, as managing director of the company, was in charge of the day-to-day operations. Mr Topui's third son worked for the company for a period and in about Aug 1997 Mr Topui's eldest son returned from the USA and had an involvement in the running of the company. He started off as store manager. From about this point in time for one reason or another the close relationship between the accused and Mr Topui began to deteriorate. Mr Topui said that previously he had trusted the accused 100% but doubts began to sink in. The accused, for his part, suspected that Mr Topui and his family were trying to take over the company. The evidence at the trial did not explore the reasons for the gradual falling out in their relationship and, of course, it did not need to do so. But the situation got worse and reached a head in about March 1998.

To try and help sort matters out Mr Topui invited his nephew, Sebastian Hurrell, who was an accountant in New Zealand to come across to Tonga and look at the way the business was being run and he came over in late March 1998. Mr Hurrell was widely experienced both as an accountant and as a businessman in Tonga and in New Zealand. The upshot of all this was that it was agreed that there would be a parting of the waves -- the accused would leave the company. The directors had a board meeting on 30 March. At that meeting a handwritten note was tabled which contained the accused's entitlement of his severance package under his contract of employment. On that same day Mr Hurrell asked the accused for a copy of the contract because he had not been able to find a copy around the office. Next day the accused produced a copy of the contract. Mr Hurrell went through it and confirmed that his entitlement under it equalled the figure of $37,000 that had been calculated previously by the accused.

The accused had already had the $37,000 withdrawn from the company's bank account and placed in a solicitor's trust account. That same day, 31 March 1998, Mr Howell drafted a letter for Mr Topui to sign addressed to the accused confirming the settlement package. When Mr Topui signed the letter he was concerned about the proposed payment of $37,000 because he did not think that the accused was entitled to that sort of figure under the employment contract he had signed but Mr Hurrell told him that the figure matched up with his entitlement under the contract. Mr Topui, nevertheless, could not accept that the contract Mr Hurrell had been shown was the same document he had signed back in October 1996 and nor could his daughter, Pesita, who he showed it to.

Eventually, after making a complaint to the police, Mr Topui was able to sight at the police station a copy of the original contract he had signed (exhibit 2) and he noticed that it was different from the contract that the accused had made available to Sebastian Hurrell (exhibit 3). A formal complaint was then laid and this prosecution followed.

Exhibit 2 is 4 pages long and exhibit 3 is 5 pages long. The Crown's case is that, without the knowledge or consent of the company or Mr Topui, the accused made up the first four pages of the second contract (exhibit 3) which contained terms and conditions more favourable to him than the first contract and then he attached the final page which was a copy of the final page of the first contract containing the signatures so as to make the second contract look like a genuine contract.

This was the basis for the two charges brought against the accused.

Count 1- forgery, contrary to section 170 of the Criminal Offences Act (CAP 18)

Count 2 -knowingly dealing with a forged documents -- contrary to section 172 of the Criminal Offences Act.

This is a criminal case and I am mindful of the fact that the onus is on the prosecution to establish all elements of the charge beyond reasonable doubt. The accused does not have to prove anything and he does not have to give or call evidence. He has the right to remain silent. In this case, however, Mr Naidu has elected to give evidence. He does not deny the existence of the two contracts but he denies any wrongdoing.

Mr Naidu says that the first contract was made up at short notice for the purposes of obtaining his work permit. The accused said in his statement to the police that then immediately after that he amended the contract to include the additional provisions regarding the salary and other benefits and those changes were all discussed with Mr Topui and agreed to between him and his wife and he then attached the last page of the first contract which remained unchanged. He then says that he made two copies, read the contract to Mr Topui at his home before dinner in the presence of his wife and he explained to Mr Topui that, as he had attached the last page of the first contract, there was no need for Mr Topui to sign. He then says that Mr Topui went through the contract line by line and was fully aware of the contract. The accused says he gave Mr Topui a copy of the contract.

This account by the plaintiff was very fairly put to Mr Topui by Mr 'Etika in cross-examination and Mr Topui denied it entirely. He says that there was only ever one contract and that was the one which he gave evidence about that was given to the Immigration Department. So at the end of the day it comes down to a question of credibility. Who do I believe?

I say at once that I found Mr Topui to be a thoroughly honest witness and I believe his account of this whole business. I do not accept the account given by the accused and his wife. The accused's story defies belief and I did not find he or his wife credible witnesses. I find support for my conclusions on credibility in the documentary evidence produced. In his statement to the directors meeting on 8 Apr 1998, the accused said that the second contract was drawn up at a later date from when the first contract was drawn up and it was after the work permit had been granted-- 25 Mar 1997. He also said that the second contract had been signed again by Mr Topui and witnessed by Mr Topui's wife. He denied in evidence that he said that but I heard the evidence of Mrs Collier who recorded the minutes and I believe her.

In his statement to the police, on the other hand, of 28 May 1998, the accused said that the second contract had been drawn up immediately after the first contract and the last page consisted of a copy of the first page containing the signatures. This was a totally different story from what he had told the directors seven weeks beforehand. The accused also said in evidence that his and Mr Topui's signatures on the first contract had not been witnessed by Piliseta Topui but she witnessed it later on. I heard her give evidence to the opposite effect and I believe her. The accused said he took two copies of the first contract -- one for himself and one for the office. If it was just for the purposes of the work permit, why leave one in the office? He also made quite an extraordinary concession under cross-examination that the first contract was an invalid one.

My finding is that there was only one genuine contract and that was the first contract given to the Immigration Department. The second contract was made up by the accused alone without the knowledge or consent of the company or Mr Topui and it was made to deceive the company.

I find that the ingredients necessary to establish a charge under section 170 have been proved by the Crown beyond reasonable doubt and the accused is convicted on count 1.

I also find that the Crown has made out the ingredients necessary to establish a charge under section 172 of the Criminal Offences Act. The accused knew that the second contract was a forgery but he acted upon it in his capacity as general manager/managing director of the company and he caused other people to act upon it as if it were genuine. He is therefore convicted also on count 2.

NUKU'ALOFA: 29 August, 2000.

JUDGE

NOTES ON SENTENCING

Facts:

-- forgery by its very nature is an insidious crime .

--hard to detect

-- as such when a case is detected and brought before the courts, the courts must have more regard than in other cases perhaps, to the deterrent factor in sentencing .

Mitigation:

-- married, two children.

-- operating a hardware company in Nuku'alofa at the moment.

-- Not re-offended since the offence was committed

-- he was cooperative with the police

-- has kept all his conditions of bail without breach (including going overseas)

-- no previous convictions

Comment:

The sad part -- obviously did a good job establishing the business. References show good relationship with suppliers. Had you approached the directors and asked for the salary increase and other benefits provided for in the second contract then I am sure that you would have been able to work it through and they would have agreed.

Sentence:

Maximum - seven years first count, second count five years.

Think justice will be served best by imposition of a significant fine rather than a term of imprisonment.

Count 1 - fined $4000

Count 2 - fined $3000.

Total $7000 to be paid within 14 days, i.e. by Tuesday 12 September at 5 p.m., and in default of payment three months imprisonment.