City Harvest case: 5 highlights from the Court of Appeal's judgment

A five-judge Court of Appeal dismissed a bid to reinstate the original convictions for church founder Kong Hee and five others convicted for misusing millions in church funds.

In a 152-page judgment, the Court of Appeal explains why it ruled in favour of the six former City Harvest Church leaders, upholding their current convictions and reduced jail sentences.

Below are the five highlights of the decision.

1. Agent or not agent?

The Court of Appeal ruled that the term "agent" in Section 409 of the Penal Code, which provides for enhanced punishment for criminal breach of trust (CBT) for certain classes of people, applies only to someone who is a professional agent.

As such, company directors and key officers of charities, such as the six found guilty in the City Harvest Church case, could not be convicted under Section 409.

The court said its conclusion was supported by the language and structure of the provision itself.

There is also a coherent and well-established line of authority, tracing back to almost two centuries, that an "agent" under Section 409 must be an individual who is in the business of providing agency services.

The court rejected the prosecution's definition based on the law of agency in commercial law, that an agent refers to someone who is authorised to act on behalf of another person.

2. Ruling's ramifications

The ruling has wider implications beyond the City Harvest case.

For the past 40 years, company directors who commit CBT have been charged under Section 409, following a High Court ruling in the 1970s.

Now that this position is held to be wrong in law, this means there is a lacuna, or a gap in the law, relating to the punishment to be meted out to company directors and key officers of charities and societies who commit CBT.

3. Parliament to fill gap

The court said the gap in the law should be remedied by Parliament.

The court acknowledged that there is a strong and urgent impulse to ensure that persons in positions of responsibility are made to undergo a sentence that reflects the full measure of their harm and culpability.

 

However, a "strained application of interpretative principles" by the courts would only represent "a proverbial papering over of part of the conceptual cracks and shortcomings in Section 409 that have accrued over the last century and a half, and which continue to widen as socio-economic conditions evolve".

The courts are ill-suited to undertake a "long overdue" and wide-ranging policy review of the various classes of persons who deserve more or less punishment for committing CBT in the 21st century.

4. Unanimous decision

Judges of Appeal Andrew Phang and Judith Prakash, and Justices Belinda Ang, Quentin Loh, and Chua Lee Ming concurred on the interpretation of "agent" under Section 409.

This was unlike the split decision in April last year, in which Justice Chan Seng Onn had a different view from then Judge of Appeal Chao Hick Tin and Justice Woo Bih Li.

That decision saw the former church leaders cleared of the more serious form of CBT as agents, under Section 409 of the Penal Code, and instead found guilty of simple CBT under Section 406.

5. Principles for criminal reference

The court laid down guiding principles for scenarios when the Public Prosecutor files a criminal reference in cases where the magistrate's appeal has been heard by a specially convened panel of three judges sitting at the High Court.

Only questions of law of public interest can be referred to the Court of Appeal in cases where the High Court has already heard an appeal.

Generally, when a legal question has been considered and answered by a three-judge panel, it is considered to have been settled and is therefore no longer of "public interest".

However, the Court of Appeal found that even though the City Harvest case had been decided by a three-judge High Court, the circumstances were "sufficiently exceptional" to justify the Court of Appeal hearing it to make an authoritative determination.

This was on the principal basis that there were two High Court decisions that adopted diametrically opposite positions on the issue - the 1970s judgment and the one in April last year.

The "particularly vexing nature" of the point of law was amplified by the fact that High Court panel hearing the City Harvest case in April last year was split on the result.