Apex court upholds shorter jail terms for former City Harvest Church leaders

SINGAPORE — Six former City Harvest Church leaders convicted of misappropriation of church funds will not have to spend additional time behind bars, after the apex court ruled they should not be convicted for aggravated criminal breach of trust (CBT).

The Court of Appeal's ruling marks the end of the saga involving church founder Kong Hee and his five deputies, for which investigations began in 2010 and the trial started in 2013.

The verdict was met with relief in the dock, and wide smiles and hugs among church members who packed the public gallery on Thursday (Feb 1).

Judge of Appeal Andrew Phang, who delivered the judgment, said the apex court agreed with the High Court's 2-1 majority ruling last April.

The High Court had ruled that an "agent" under Section 409 of the Penal Code does not include directors of corporations, governing board members, key officers of charities or officers of societies.

Thursday's affirmation of the ruling means Section 409 has been wrongly interpreted on some occasions for the past 40 years.

During that time, there were 16 reported cases of directors convicted under the provision, Deputy Attorney-General Hri Kumar Nair had said in his arguments before the court last August.

But the High Court had noted that any erroneous interpretation of a provision, especially one that imposes criminal liability, must be corrected regardless of how entrenched it may have become.

Addressing the gap, or lacuna, in the law for CBT should be left to Parliament, said Judge of Appeal Phang.

"A hard case should not be allowed to make bad law," he said, adding that the six individuals are not getting away unpunished. The apex court had to consider the fundamental issue of "where the line is to be drawn between judicial interpretation on the one hand and legislative action on the other", he said.

The Attorney-General's Chambers said after the verdict it will work with government ministries on appropriate revisions to the Penal Code, to ensure company directors and others in similar positions of trust and responsibility are subject to appropriate punishments for CBT.

Prosecutors had filed a criminal reference to raise questions of law of public interest, after the jail terms of Kong and five others were slashed by the High Court last April. The High Court convicted them of CBT under Section 406 of the Penal Code (plain CBT), which carries a maximum jail term of seven years.

The lower court had in 2015 found them guilty under Section 409 of CBT by an agent (aggravated CBT), which carries a higher maximum jail sentence of 20 years.

But the High Court found that an "agent" under Section 409 must refer to "professional agents", who offer their agency services as a "commercial activity" for profit – which the church leaders did not.

As a result, their jail terms were slashed to between seven months and 3.5 years, down from 21 months to eight years.

The five-judge apex court that heard the criminal reference — through which the prosecution sought heavier punishment for the six — comprised of Judges of Appeal Phang and Judith Prakash, and Justices Belinda Ang, Quentin Loh and Chua Lee Ming.

Section 409 of the Penal Code was first enacted as a provision within the Indian Penal Code in 1860, at a time when professional agents such as brokers and merchants were recognised as a distinct class of persons who provided agency services to the public, the judges noted. It was brought into force in Singapore by the Legislative Council of the Straits Settlements in 1872.

While a director may be an agent of a company or organisation, he does not offer his services as an agent to the community at large, said Judge of Appeal Phang. The relationship between a director and a company is an "internal" one.

"In the modern context, where directors of companies and officers of charities and societies play key roles in the lives of companies and the economy as a whole, there does not appear to be a good policy reason to ignore their heightened culpability and enhanced potential harm were they to commit CBT," the judge acknowledged. But the "shaping of a remedy" should be left to Parliament, he stressed.

The courts are ill-suited and lack the institutional legitimacy to undertake the wide-ranging, "long-overdue" policy review of various classes of persons, in modern conditions, who deserve more or less punishment for committing CBT, he said.

The prosecution's proposed definition of an "agent" in Section 409 as referring to any legal agent was both over-inclusive and under-inclusive, he said. It would include low-level workers entrusted with small sums of money, but exclude many categories of persons deserving of equal or greater punishment who were not legal agents, said Judge of Appeal Phang.

The high-profile case saw the former church leaders convicted of misusing S$24 million of church building funds on sham bonds between 2007 and 2009, mainly to further the pop music career of church co-founder and Kong's wife Ho Yeow Sun.

Another S$26.6 million was misused to cover up the first amount.

One of the six individuals – former finance manager Sharon Tan, 41 – has already completed her seven-month sentence. She arrived in court on Thursday in a black dress and exchanged broad smiles with the others. She shed tears, and was hugged and congratulated by many supporters after the verdict.

The church's former fund manager Chew Eng Han, 57, is out on bail and will begin serving his sentence on Feb 22 after spending Chinese New Year with this family.

Kong, 52, his former deputy Tan Ye Peng, 44, former finance manager Serina Wee, 40, and former finance committee member John Lam, 49, are serving their jail terms. They arrived in the courtroom shortly after 9am. Kong smiled and waved to some supporters, as did Lam and Tan Ye Peng.