FND

 IN THE HIGH COURT OF COLOMBO

THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA.

-vs-

1.     Ambalavanar Nityanandan Raja.

2.     Aruma Baduge Stanislous Roy de Silva.

Case No 4335/91.

Before F.N.D. Jayasuriya Esqr, Hiqh Court Judge.

09.07.1992.

1^st and 2^nd accused present.

Mr R.Tambiratnam, Attorney-at-Law, with Mr Thavarasa,

Attorney-at-Law appear for the first accused.

Mr M.L.M. Ameen, P.C with Mr Suren Fonseka, Attorney-at-Law, Mr S. Kalupahana, Attorney-at-Law and Mr H.Peiris, Attorneyat-Law for the second accused.

Mr S.Jayamanne, State Counsel appears for the Republic.

At this stage I invite the attention of the learned State Consel to the evidence given this morning before court by prosecution witness No 2 K.A. Vincent Mitra Perera who is an employee of British B.C.C Ltd, which company is the virtual complainant- company in this case. This witness has stated in evidence that orders were sent jn writing for the supply of blades and cakes of soaps by the 1^st  accused to the Marketing Manager of B.C.C Ltd, together with a cheque for the full value of goods purchased and supplied on each occasion. On the receipt of this order and cheque in payment, an order for the delivery of goods was executed in writing by the witness and the goods in question were loaded into the lorries of the first accused and the goods so delivered became the property of the first accused. In regard to the trust, he testified that they had complete trust in the first accused and believed that the cheques would be honoured on presentation. Since this particular witness is one of the crucial witnesses of the prosecution, I at this stage draw the attention of the learned State Counsel to the decisions pronounced by the Supreme Court in 'LOUDON VS ENDORIS SILVA' 1916/3/ Ceylon Weekly reports- page 245 and the decision in KING VS VINA TAMBU 2 Matara Cases Page 195. On an analysis of the principles laid down in these two decisions and the apparent distinction in point of fact arising in these two particular decisions, it is evident that for the constitution of a charge of criminal breach of trust that the prosecution is under a bounden duty to establish in this particular case, a trust in respect of the cakes of soap and blades which were loaded into the first accused's lorry. On the application of principles of law arising from these two decisions, it is apparent that if at the point of delivery to the lorry, the blades and cakes of soap became the property of the first accused and there was only the creation of the relationship of debtor and creditor between B.C.C Ltd, and first accused in regard to the payment of the purchase price for the goods supplied then the charge of Criminal Breach of Trust in respect of the cakes of soap and blades cannot be established in law. According to the provisions of the Sale of Goods Ordinance (the sale of movables) by the execution of certain memoranda itself, property in the goods sold would pass to the first accused. In addition , in this case there was a completed delivery and handing over of the movable articles in question, which would have operated to transmit ownership of blades and the cakes of soap to the first accused. In the circumstances, on the evidence of this witness the prosecution has failed to establish a trust in relation to the blades and cakes of soap which are the items which are specified as the objects in respect of which Criminal Breach of Trust is alleged to have been committed in counts 1 and 2 of the Indictment. Having drawn the attention of learned State Counsel I grant him a further opportunity to address court on the law and facts arising for consideration in this case.

I call upon Mr Sarath Jayamanna, State Counsel to make submissions against the propositions and observations which I had occasion to set down.

Mr. Jayamanna does not wish to make submissions against the propositions and observations made by me but moves for an adjournment to obtain instructions from the senior officers of the Department.

I disallow the application. I do not think it is justifiable to postpone this case any further in view of the matters which appear crystal clear to me. Therefore I refuse the application for postponement and again invite him to make his further submissions.

At this stage Mr.Jayamanna states as the court has refused his application for an adjournment in view of the evidence so far led in this case for the prsecution, he does not wish to proceed further with this prosecution.

O R D E R

I draw my attention specifically to the evidence given by prosecution witness K.A.Vincent Mitra Perera who is a star witness on whom the prosecution relies heavily to prove the charges against the accused. In answer to court towards the tail end of his Examination in chief, he has stated specifically that when the first accused sent orders in writing for the supply of cakes of soap and blades to him, he sent together with his written orders cheques for the exact value of the goods to be supplied to him. On receipt of the cheques, he has stated, that the officials of the virtual complainant trusted and relied on the credentials of the first accused and issued an order for the delivery of goods in question and the goods were delivered and loaded into the lorry furnished by the first accused. In reply to court he specifically stated once the goods were sold and loaded into the lorry that the movable items in question became the property of the first accused. The officials of the virtual complainant company trusted the first accused and believed that the cheque tendered would be honoured when presented to the bank.

However, the first accused, acting immorally, has stopped payment on these cheques and the virtual complainant company was unable to collect the monies due on the cheques. On this factual foundation, the court has to consider whether the prosecution case could be proved beyond reasonable doubt against the first and second accused. On the question of the trust and entrustment of the blades and cakes of soap as contemplated in section 388 of the penal code, it is quite clear to this court that property in the cakes of soap and blades had been transmitted to the first accused on the execution of certain memoranda and delivery of the goods in question on the application of the provisions of the Sale of Goods Ordinance. There was no trust created in respect of the cakes of soap and blades but there was the creation of the relationship of creditor and debtor in respect of the monies due on the cheques. If the first accused issued the cheque with the intention of stopping _payment in the first instance itself, a classic case of cheating is made out. The state counsel who prepared the Indictment has not given his mind to this aspect of the case and has decided to found counts 1 and 2 on charges of Criminal Breach of Trust.

Although the facts in the particular case were different, the principle which was laid down by Justice Wood Renton in 'Loudon VS Endoris Silva 1916-3 C.W.R 245 is applicable to the present prosecution, in that decision Justice Wood Renton held that once the money was handed over to the contractor, the property in the cash passed to the contractor and that he could not be convicted of a charge of Criminal Breach of Trust in respect of money handed over even though the contractor had dishonestly and fraudulently intended not to perform his obligations under the building contract. Justice Wood Renton emphasized that the transaction in question was the creation of the relationship of creditor and debtor in regard to the performances of the obligations under the building contract but that there was no trust created in respect of the money handed over to the contractor. Both commentators on the Indian Penal Code Gour and Ratnalal and Thakore advert to several Indian decisions where the same principle has been laid down.

I do not wish to burden this order with all these Indian precedents. In King VS Vina Tambu 2 Matara Cases 195, the factual foundation was different to the facts in these two Sri Lankan Cases presently examined by me. In that case, a salesman — employee was entrusted with opium for sale under a duty to account for it to the employer at a specific rate, and he preceded to misappropriate the opium. It was contended for the defence that the opium once handed over became the property of the employee. But on a careful analysis of the facts in that case the Supreme Court held, despite the duty to account for the opium to the employer at a specific rate that the opium in question, on the facts of that case, continued to be the property of the employer till sold and it was property of the employer entrusted to a sentant under a contract as to the way in which he should dispose of it and therefore the employer, salesman was guilty of the offence of Criminal Breach of Trust. The facts in the present case are quite different to the facts in King vs Vina Tamby. On a consideration of the factual foundation of this instant case and on an application of principles of law enunciated, I hold that the prosecution has failed on the testimony of this material witness to prove beyond reasonable doubt that a trust had been created as against the first accused, in relation to the cakes of soap and blades delivered into the first accused's lorry. Proof of such entrustment and a trust is a sine qua non for the constitution of a valid charge of Criminal Brach of Trust. Vide Kalayanaratne vs Gunasasa 40 NLR page 42 and Basnayake vs Inspector of Police 66 NLR 379.

In the circumstances I have arrived at an adjudication on the merits that the charge of Criminal Breach of Trust as set out in counts 1 and 2 of the Indictment cannot be proved in the particular case.

INTERRUPTION AND INTERVENTION

Mr. R.Tambiratnam at this stage intervenes and states that the court should compel state counsel to call other witnesses listed in the list of witnesses at the back of the Indictment or such other witnesses who support the prosecution's case.

In regard to Mr. Tambiratnam's application I make the following order.

ORDER

The learned state counsel has stated his position quite categorically with regard to the prosecution case. The learned state counsel is the dominus litis in regard to the conduct of the prosecution case. Neither court nor Mr. Tambiratnam, defence counsel, is entitled to dictate to the state counsel in regard the presentation and adduction of evidence in respect of the prosecution case. Certainly, Mr. Tambiratnam is not entitled to dictate to learned state counsel in regard to the manner of conduct of the prosecution case. Likewise Mr. Tambiratnam is the dominus litis in regard to the conduct of the defence case and state counsel is not entitled to dictate to him in regard to the adduction of evidence in respect of the

defence case. Hence, I hold that Mr. Tambiratnam is not entitled to make and press this application before court. His application is therefore refused.

I was in the process of making my order now I continue to make my earlier order.

ORDER CONTINUED

The prosecution case on the evidence of the sheet anchor witness for the prosecution has collapsed irreparably and beyond repair, so much so that in the well known precedent of Humpty-Dumpty's case, no amount of human ingenuity and effort could put "Humpty-dumpty" together again. I have arrived at an adjudication on the merits that the prosecution is not in a position to establish this case beyond reasonable doubt in regard count 1 and 2 in relation to the first accused. However, accordingly to the three bench judgment in Rex VS William 44 NLR 74 this court is entitled to make an order of acquittal only at the close of the prosecution case which has been construed to mean the technical close of the prosecution case. ^X However Justice Samarawickrama in A.L.D.C de Silva vs C.Vidanagammatchi 80 C.L.W page 94 has taken a slightly less rigorous view and held that the court is entitled to make order of acquittal at the virtual end of the prosecution case. ^Y Although there is no specific provision in the Criminal Procedure Code in relation to High Court proceedings, principles of English Law had been introduced in regard to the law procedure in terms of former section 6 of the Criminal procedure Code and these principles can be applied even today in terms of section 7 of the Criminal Procedure Code. Hence, in as much as there has been no technical closure or the virtual closure of the prosecution case, I desist from entering an order of acquittal. In the exercise of the inherent power of court and following the observations of Justice T.S.Fernando in Regina VS Pauline De Croos 71 NLR 169. I do not intend to continue further proceedings in this case. Therefore I make order discharging the first accused on count 1 and 2 of the Indictment. If counts 1 and 2 cannot be established against the first accused, the second accused who is indicted with abetment of offences specified

x Sumangala Thero vs Piyatissa Thero 39 NLR 265, Fernando vs Rajapakse 47 NLR 399, A.G vs Gunasekera 60 NLR 334, Kiri Banda vs A.G 61 NLR 227, De Silva vs Jayatilake 67 NLR 169 (divisional bench)

Y Edwin Singho vs Nanayakkara 61 NLR 22, Wanigasekera vs Simon 57 NLR 377

in count 1 and 2 of the Indictment, has necessarily to be discharged in respect of counts read to him.

I make order discharging both accused.

Sgd. F.N.D. Jayasuriya

High Court Judge - Court No 1.

09.07.1992

MY REFERENCE:

KING VS FONSEKA 47/207

Howard C.J.- due to non appearance of the crown counsel..discharged.. No power as no trial whatsoever — Indictment was not read..accused not pleaded... charge not given to proceed the case.

REX VS WILLIUM 44/74

Acquitted only at the close of the prosecution case. (technical closure)

A.L.D.C.DE SILVA VS VIDANAGAMMATCHI 80 CLW 94 Acquitted ..at the virtual end of the prosecution case..