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Karson, the Chief Engineer of a hotel, was assigned to oversee a $5 million renovation project for the hotel’s main lobby. Kenneth, the proprietor of a construction company, was selected as the contractor for the renovation work.
During the traditional “God Worshipping” ceremony that marked the project’s commencement, Kenneth offered Karson a red packet of $30,000 as a token of gratitude for his assistance in awarding the contract. Karson gratefully accepted the offer.
One month later, while inspecting the project’s progress, Karson noticed that the quality of the marble used in the lobby was substandard and did not meet the tender specifications. Due to the tight schedule and cost implications, Kenneth was reluctant to replace the marble. To cover up the issue, he proposed giving Karson a rebate of 2% of the project sum in exchange for Karson turning a blind eye to the substandard work. Although bewildered by the offer, Karson verbally agreed to the arrangement to avoid damaging the harmonious working relationship with Kenneth.
Case Analysis
According to Section 9 of the Prevention of Bribery Ordinance (POBO), it would be an offence if Karson, a hotel employee, without the permission of his employer, accepted an advantage, i.e., the red packet and the 2% rebate of the project sum, for awarding the renovation project to Kenneth and turning a blind eye to the substandard work. Kenneth might also violate POBO by offering bribes.
According to Section 19 of the POBO, it shall not be a defence to show that the acceptance of advantage is customary in any profession, trade, vocation or calling. Although the red packet was offered during the customary “God Worshipping” ceremony, the court shall determine the legality based on whether the recipient had obtained the permission from his principal.
Although Karson did not actively solicit advantages and might not have ultimately received any commission from Kenneth, the verbal agreement between the two parties to conceal the substantial work still constituted corruption. According to Section 11 of the POBO, once an agreement to offer and accept a bribe is reached, both the offeror and acceptor of the bribe shall commit an offence even if the acceptor claims that he did not actually carry out the act as agreed.
Karson might also breach the Rules of Conduct of the Hong Kong Institution of Engineers (HKIE) which states that a member of HKIE shall discharge his duties with integrity and in accordance with the highest standards of business ethics; and neither give nor accept any gift, entertainment, payment or service of more than nominal value, to or from those having a business relationship with his employer or client without the consent of the latter.