R v Heyne and Others

• Jurisdiction: South Africa
• Judge: Schreiner JA, Fagan JA, De Beer JA, Hall JA and Beyers JA
• Judgment Date: 19 June 1956
• Court: Appellate Division

E Schreiner, J.A.:

Three private companies, each the owner of a bottle store, and fifteen natural persons were tried by RUMPFF, J., sitting alone in the Witwatersrand Local Division, on one count of fraud, twenty-one counts of contravening sec. 161 (d) or, alternatively, sec. F 164 (a) of the Liquor Act, 30 of 1928, and one count of bribery. One of the companies was discharged because it had not been duly served and was therefore at no stage properly before the Court. The two other companies were convicted on certain counts, but they did not seek leave to appeal. Of the natural persons one died during the proceedings and four were found not guilty and discharged on all counts. Of the other ten persons G the first appellant was convicted on all twenty-three counts. The second and third appellants were each convicted of fraud, bribery and two contraventions of the Liquor Act. Of the seven remaining persons four were convicted of fraud and one or more contraventions of the Liquor Act, and three were convicted of contraventions of the Liquor Act.

H Leave to appeal against the convictions was granted by RUMPFF, J., in all cases, save that it was refused to the first, second and third appellants on the charge of bribery. The first appellant alone was granted leave to appeal against the sentence imposed upon him. Application was thereafter made to the CHIEF JUSTICE by the first three appellants for leave to appeal on the bribery charge and by the fifth

Schreiner JA

and sixth appellants for leave to appeal against their sentences. All the applications were referred to the Court and, the Crown not opposing, were granted. In addition to the appeals proper the Court had before it certain questions of law reserved by RUMPFF, J.; the nature of these A questions, so far as they are not covered by the appeals, will appear later.

At the hearing of the appeals the first, fourth and eighth appellants appeared in person, the second appellant was represented by Mr. Human, the third, fifth and sixth appellants were represented by Mr. Morris and B the tenth, eleventh and twelfth appellants made no appearance. For the sake of convenience Mr. Morris presented his argument first.

The background of the charges, based on facts which are no longer in dispute, may be stated shortly. The first appellant was at all material times a director and in control of the Richmond Bottle Store (Pty.) C Ltd., which owned the Richmond Bottle Store in Johannesburg. The licence had been granted about 1949. In 1953 the Richmond Company acquired the Kosmos Hotel at Hartebeestpoort. Among the customers of the Richmond Bottle Store were a number of Chinese who until the 15th August, 1952, were entitled to obtain intoxicating liquor for their own D consumption. By a Proclamation issued on that date it ceased to be permissible to supply liquor to them. Before then the Richmond Bottle Store had been supplying its Chinese customers both openly across the counter and secretly under a system of delivery by motor vehicle, into the details of which system it is unnecessary to enter. The reason for the secret supply before August, 1952, was that in practice a measure of E police control was exercised over the quantities openly delivered to Chinese, the object being to prevent the latter from reselling to other non-Europeans. When the change was made in August, 1952, the open selling ceased but the secret, illegal, trade was continued and expanded greatly; from the beginning of 1953 to the middle of 1954 the turnover F at Richmond reached a figure which, together with that of the two bottle stores to be mentioned presently, amounted to about £250,000.

At the December sitting of the Pretoria Liquor Licensing Board the first appellant secured the issue to his nominees of two new bottle store licences in the Pretoria district. Two new companies, Kloofsig Bottle G Store (Pty.) Ltd. and Valhalla Bottle Store (Pty.) Ltd., were registered and became, respectively, the beneficial owners of the new licences. They, with the Richmond company, were the three companies which were charged before RUMPFF, J. Valhalla Bottle Store commenced business in January and Kloofsig in February, 1954. In addition to their lawful H operations they conducted a certain amount of secret, illegal, trading directly or indirectly with Chinese customers; they also engaged in an interchange of supplies to a slight extent with each other and to a very great extent with the Richmond Bottle Store; these inter-store transfers, which were predominantly from Pretoria to Johannesburg, were, generally speaking, in support of the secret illegal trade of the three stores. The appellants, other than the first three appellants, were at all material times employed by one or other of the three companies.

Schreiner JA

The second appellant is a captain in the South African Police who had since the beginning of 1953 been at the head of the Pretoria Criminal Investigation Department, including its Liquor Branch. His predecessor in that post was the third appellant, who had been stationed in A Johannesburg from 1947 until the beginning of 1952, when he was transferred to Pretoria; after a year there he had a serious operation and was stationed successively at Umtata and Boksburg, remaining at the latter place from the middle of 1953 until his arrest upon the present charges about a year later.

B The second and third appellants had been friends since about 1946, and the first and third appellants had been friends since about 1950.

In the early part of 1954 the second and third appellants each acquired from or through the instrumentality of the first appellant 500 £1 shares in the Kloofsig Company and 1,000 £1 shares in the Valhalla Company. The third appellant paid for his shares but the second appellant did not. C After certain allotments and initial transfers of shares the holdings of the 5,000 issued shares in the Valhalla Company were established at 2,000 held by the first appellant and 1,000 each held by the second and third appellants and by a Crown witness named Lifton. The Kloofsig Company issued 2,500 shares, of which the first appellant held 1,000 and the second and third appellants and Lifton each 500.

D On the 8th June, 1954, the three bottle stores were simultaneously raided by the police and the subsequent investigations revealed the large scale illicit trade and an extensive system of false entries in and omissions from the sales registers, stock book and invoices kept in pursuance of secs. 105 and 135 of the Liquor Act; there were also E misstatements concerning turnover at Richmond in certain monthly letters customarily rendered by licensees to the police in the Johannesburg area. The fraud charge arises out of the false representations conveyed by these books and documents and also out of certain misstatements in the financial records of the three companies owning the bottle stores.

F As one of the issues on appeal was the sufficiency of the indictment on the fraud count it is necessary to state its material provisions. The count alleged,

'That the accused are guilty of the crime of fraud in that every day except Sundays and public holidays during the period 1st January, 1952, to the 8th June, 1954, and at Johannesburg and Pretoria in the districts of Johannesburg and Pretoria, the accused, acting in concert, did unlawfully, falsely and with intent to defraud give out and pretend to G the personnel of the liquor staffs of the South African Police, the senior officers in police charge of the districts. other members of the South African Police, and the auditors of the accused companies,'

and there follow representations alleged to have been made as to the truth and completeness of the above-mentioned sales registers, invoices, H stock books, monthly letters and financial records. The representations are alleged to have been false to the knowledge of the accused and to have been to the actual or potential prejudice of the State, the personnel of the liquor staffs of the South African Police, the senior members in police charge of the districts, other members of the South African Police, the auditors of the accused companies, the Liquor Licensing Boards and certain named persons whose names had been improperly introduced

Schreiner JA

into the sales registers as having made purchases which in fact they had not made.

At the request of the defence the Crown supplied further particulars on a number of points, but many of the details asked for were not supplied, A the Crown submitting that it had furnished all that it could reasonably be expected to furnish. The defence sought inter alia to tie the Crown down to the dates when and the places where each false entry was made and to the particular members of the police force to whom the various books and documents were from time to time exhibited. But the Crown's B case clearly was that those of the accused who had control of or made entries in the books and documents consistently over a period of two and a half years, acting in concert, created books and documents containing false entries and misleading omissions in order to deceive the police and the auditors. If such a course of conduct could properly be charged C as a single count of fraud there was no ground for the submission that the charge was defective as not setting out with precision the details of time, place and persons concerned in relation to the numberless acts of commission and omission which according to the Crown constituted the crime of fraud. The Crown furnished all the particulars that it could D reasonably be expected to supply and the defence was not embarrassed by any lack of information.

But it was contended that the crime of fraud does not admit of treatment as a course of conduct; it is always, so it was argued, a specific act of representation, made at a particular...