R. v. Kwok, 2013 BCPC 53

Citation: R. v. Kwok, Lau and Ng Date: 20130314 2013 BCPC 0053 File No: 55856-3-C Registry: Richmond IN THE PROVINCIAL COURT OF BRITISH COLUMBIA REGINA v. Yiu Tim KWOK, Hin Cheung LAU and Wing Kee NG REASONS ON SENTENCE OF THE HONOURABLE JUDGE E. J. McKINNON Counsel for the Crown: J. Walker and H. Pineo Counsel for Yiu Tim Kwok : A. Ip Counsel for Hin Cheung Lau : M.B. Thompson Counsel for Wing Kee Ng : D.G. Baker Place of Hearing: Richmond , B.C.

Dates of Hearing: June 5-7, 12-14, 18-21, 25-28, July 3-4, 9-11, 26, September 28, November 1 and 13, 2012, February 19 and 20, 2013 Date of Sentence: March 14, 2013 [ 1 ] Yiu Tim Kwok and Wing Kee Ng have been found guilty of importing approximately 1,000 kilograms of Ketamine into Canada, worth up to $50 million dollars, hidden in a marine shipping container. They and Hin Cheung LAU have also been found guilty along with of possessing the Ketamine for the purpose of trafficking. [ 2 ] This matter commenced with two other co-accused.

Tak Ming Chan suffered a stroke while in custody, and the charges have now been stayed against him. Partway through the trial, I ordered that Hoi Sing Lai be tried separately. He has not yet come to trial. FACTS [ 3 ] The following is a brief

summary of my findings of fact as contained more fully in my Reasons for Judgment. [ 4 ] At the sentencing hearing, the Crown called Ronald Pon, a forensic toxicologist at the RCMP Forensic Laboratory in Vancouver, to provide expert opinion evidence on the uses and effects of Ketamine, methamphetamine, cocaine, opium, heroin and marijuana. [ 5 ] Mr. Pon testified that Ketamine is legitimately used as an anaesthetic agent in surgery, primary for children and the elderly. It is also used as an anaesthetic in veterinary surgery.

Ketamine is found in liquid form when used for legitimate purposes. [ 6 ] According to Sgt. Rintoul, an RCMP drug expert, Ketamine is used illegally as a hallucinogenic recreational drug. A user experiences a euphoric and dissociative state, commonly described as an “out of body” experience. When used illegally, Ketamine is commonly found in powdered form or combined with other illegal drugs into tablets. The tablets are ingested, or Ketamine is snorted or dissolved and then ingested in liquid form.

When in tablet form, it is impossible to tell what drugs or substances have been mixed with the Ketamine, or what dosage of the Ketamine or other drug is in that tablet. Methamphetamine and caffeine are commonly mixed with Ketamine in tablet form to increase euphoria, and used as a party drug. Ketamine is similar to PCP in its chemical analysis, a drug that was widely used in the 1970’s for its hallucinogenic effect. [ 7 ] Long-term effects of Ketamine use can include exacerbation of pre-existing mental health illnesses, schizophrenia, and can lead to catatonia and hallucinogenic relapses. Mr.

Pon testified that there have been deaths associated with the use of Ketamine when taken with alcohol or GHB. Ketamine is not a physiologically addictive drug, like heroin, but it is psychologically addictive. [ 8 ] Kwok and Ng were apparently residents in Hong Kong when they conceived this plan to import Ketamine into Canada. They travelled to India, where Kwok purchased goods and made arrangements to facilitate that shipment. Kwok was in India for about two months. He purchased a marine shipping container’s worth of coffee mugs from an Indian pottery manufacturer and arranged for their delivery to Hong Kong.

He purchased various materials and equipment used to vacuum-pack the Ketamine, to re-strap the pottery’s cardboard boxes in which the Ketamine would be hidden, and other paraphernalia such as scales and electric fans. Ng was in India at some of the same times as Kwok, but it is not clear whether or not they met there. Chan was also in India during some of this time. [ 9 ] The Ketamine was vacuum packed in plastic and then placed inside the pottery’s cardboard boxes of coffee mugs. Ng left his fingerprint on one of the plastic bags. The boxes were then re-strapped, ready for shipment.

Arrangements were made for the marine container to be shipped to Canada by sea. All this took place in late summer and early fall 2010. [ 10 ] On December 1 st , 2010, Kwok and Chan arrived at Vancouver International Airport from Hong Kong Their behaviour was such that the suspicions of Canada Border Services officers were aroused. Kwok purported to be coming to Canada for a 7-day visit to visit friends and to look for business opportunities. In examining his goods, CBSA officers discovered invoices and receipts for the items purchased in India, as well as for the coffee mugs.

They discovered the shipping orders, receipt and invoice from the marine shipping company, as well as another invoice from the coffee mug manufacturer in India, in Chan’s belongings. Chan gave the CBSA Lau’s name and telephone number as a contact person in Vancouver. Lau was telephoned by CBSA and asked to come to the airport. A person identifying himself as “Andy Lau” came to YVR but provided a driver’s license in the nane of “Joe Lai”. He matched the photo on that license.

He left with Kwok and Chan in his Mazda MPV after speaking to CBSA officers and once Kwok and Chan had been allowed to enter Canada. [ 11 ] A CBSA and RCMP investigation began. The accused were placed under surveillance. [ 12 ] In the following days, Kwok and Chan went to the offices of the company handling the entry of the shipment into Canada, and paid the shipping costs and customs clearance fees. [ 13 ] Chan and Kwok inspected and leased a warehouse space in Richmond on Viking Way.

There were others present during the inspection of the warehouse space, but it is not clear who they were. [ 14 ] On December 7 th , 2010, the shipping container arrived in Canada from Hong Kong. It was taken to a CBSA inspection facility for the purpose of a secondary examination. [ 15 ] When the container was opened, there were 402 cardboard boxes inside. All the boxes were x-rayed. Those boxes showing an anomaly on the x-ray were opened. Eighty-four (84) of the 402 boxes contained powdered Ketamine in vacuum-packed plastic bags.

The boxes containing Ketamine had been arranged to be in the centre of the container. All of the boxes that contained Ketamine, except for one, contained 4 bags of vacuum-packed Ketamine. There were 335 plastic bags of Ketamine in total weighing 1,003.9 kilograms in

total. The boxes in which the Ketamine had been hidden had been re-strapped at some point so as to look like the boxes that only contained coffee mugs but the replacement strapping was a noticeably different white colour. [ 16 ] The Ketamine was seized, and sugar was substituted in plastic bags. The original strapping was able to be replaced around the boxes without being cut or damaged.

This was a brighter white colour then the strapping on boxes without any Ketamine. [ 17 ] Motion detectors were placed in the boxes that had contained Ketamine and in which the sugar substitute had been placed. [ 18 ] The shipping container was cleared by Canada Customs and CBSA for what is called a “controlled delivery”. [ 19 ] During this period of time, Chan, Kwok and Ng were staying together in one room in a Richmond hotel. They ate virtually all their meals together, along with the other accused, and travelled together in either a vehicle rented by Lau, or with Lai in his MPV.

Lau was the driver of the rented vehicle, but was driven by Lai in his MPV on at least one occasion. [ 20 ] After the shipping container cleared customs, the shipping agent called Kwok to arrange for final payment. Kwok and Chan went to the offices to pay the invoice. [ 21 ] On December 10 th , 2010, the shipping container was delivered to the leased warehouse on Viking Way. Chan and Kwok were there. Lai was seen sitting in the passenger seat of his MPV as it slowly circled nearby while the boxes in the shipping container was being unloaded into the warehouse.

During this period of time, there was a flurry of contact between cell phones connected to Kwok, Ng and Chan. [ 22 ] The next day, Lau rented a small cargo van using his own driver’s license and credit card. [ 23 ] Earlier that day, Chan, Kwok and Ng went to the warehouse on Viking Way. Within moments of their entering, one of the motion detectors in the sugar substitute boxes went off. [ 24 ] The boxes were taken out of the Viking Way warehouse and loaded into the cargo van that was being driven by Lau. Kwok was supervising. Lau drove to a warehouse on Rowan Place in Richmond where the boxes were unloaded.

It took several trips, and all the accused were seen at either the Viking Way warehouse or the Rowan Place warehouse location, or both, that day. [ 25 ] That afternoon, Kwok, Ng and Lau remained inside the Rowan Place warehouse for approximately 2 hours. During this time, Lai was out buying items like scales, packing tape, box cutters and packages of gloves. They were then picked up by Lai and went out for a meal. Kwok was driven back to the Rowan Place warehouse for a brief time, and then returned to the restaurant. They all were driven by Lai back to the Rowan Place warehouse.

The boxes were reloaded back into the van. Lau drove the van back and forth to the Viking Way warehouse with Kwok and moved the boxes back into the Viking Way warehouse. [ 26 ] Lai, Ng and Chan left the Rowan Place warehouse in Lai’s vehicle. They were followed by the RCMP to an address on Bridgeport Road, and arrested. At approximately the same time, police officers entered the Viking Way warehouse and arrested Kwok and Lau there. [ 27 ] On his arrest, Kwok had in his possession a key that opened the Viking Way warehouse front door and the rear man door.

The two weigh scales, packing tape, box cutters, scissors, etc. and multiple packages of latex gloves were in the trunk of Lai’s vehicle. Documents seized from the accused show that Kwok, Ng and Chan’s travel itineraries were issued on the same day, by the same agent, using the same booking code, with the same form of payment, and with all three scheduled to return to Hong Kong on the same day, on the same flight, sitting in the same row of the airplane. [ 28 ] The Viking Way warehouse was searched. Nothing was in it except for boxes from the shipment.

The boxes had been separated in accordance with the colour of the strapping on the boxes, that is, the boxes originally containing Ketamine had been separated from the rest. Some of the boxes had been opened, and the contents disarranged. [ 29 ] The Rowan Place warehouse was searched. Discarded Styrofoam and strapping material similar to the Styrofoam and strapping on the cardboard boxes that had contained the Ketamine, that is, brighter white strapping, was found. In a small room in the back of the warehouse, a pill press machine, multiple ziplock plastic bags, scales, a coffee grinder and some drugs were found.

The drugs were as follows: (a) 937.8 grams of a white substance which is suspected to be cellulose; (b) 71.8 grams of an orange substance which analyzed to be N- methyl-3, 4-methylenedioxyamphetamine (MDMA) in combination with suspected cellulose and other unidentified compound(s); (c) 47.5 grams of a green substance which analyzed to be N-methyl-3, 4-methylenedioxyamphetamine (MDMA) in combination with suspected cellulose and other unidentified compound(s); (d) 67.5 grams of a light orange substance which is suspected to be cellulose and other unidentified compound(s); (e) 64.3 grams of a red substance which is suspected to be cellulose and other unidentified compound(s); (f) 57 grams of an off white substance which analyzed to be N- methyl-3, 4-methylenedioxyamphetamine (MDMA); (g) 1.5 grams of an off white substance which analyzed to be methamphetamine; and (

h) a number of white pills located in the bottom of a trash can whose sample pill analyzed to be ephedrine.

[30] The hotel room where Chan, Ng and Kwok had been staying together were searched. Chan’s suitcase contained the lease forthe Viking Way warehouse, shipping documents for the shipment, an invoice from the coffee mug manufacturer in India for 402 boxes ofcoffee mugs, a packing list, a bill of lading for the container shipment, and invoices from the shipping expediter, as well as otherdocuments associated with the entry of the shipment into Canada.

Ng’s belongings included his passport, flight itinerary, a bill for theFour Point Sheraton in the name of Kwok and Ng billed to Kwok, and a bill for the La Quinta Inn in the name of Kwok and Ng billed toKwok. [31] A comparison of the dates and stamps on Chan, Ng and Kwok’s passport and travel documentation, including itineraries,indicate the following: (

a) Kwok entered India on August 7th, 2010. (

b) The invoices from Unique Potteries in India show that the coffee mugs in the shipment were purchased on August 23rd, 2010. (

c) Ng entered India on September 5th, 2010. (

d) Chan entered India on September 24th, 2010. (

e) Chan and Kwok left India together on October 19th, 2010. (

f) Ng left India some time during October 2010. SENTENCING [32] Counsel have provided me with over 30 authorities in support of their sentencing submissions. They are: Food and Drugs Act: Regulations Amending the Food and Drug Regulations (Ketamine), Canada Gazette

Part II, Vol. 139, No. 19 R v. Bacon and Scott, 2012 BCSC 983 R v. Basarowich, 2010 MBQB 42 R v. Bhangal, 2010 ONSC 4950 R v. Camara,

(2006) B.C.J. No. 1478 R v. Chan, [2008] O.J. No. 2285 R v. Dyal, 2007 BCSC 623 R v. Epp, 2006 BCCA 570 R v. Eshghabadi, et al, 2009 BCSC 1875 R v. Ferguson, 2005 ABPC 37 R v. Ho and Young (3 May 2005), Richmond 46144-4 (BCPC) R v. Kandola, 2012 BCSC 1042 R v. Kang, (2009) 2009 BCSC 1827 , B.C.J. No. 2666 R v. Lawson,

(2005) O.J. No. 1484 R v. Lepage, 2010 BCCA 249 R v. Li, 2009 BCCA 85 R v. Ma, 2005 BCSC 493 R v. Mileos,

(2008) B.C.J. No. 2669 R v. Neeb, 32 W.C.B. (2d) 455, (ONCA) R v. Pang, 2010 BCCA 500 R v. Paper, 2010 ONCJ 88

R v. Pederson and Hernandez (27 July 2011), Victoria 149340-2 (BCSC) R v. Redekopp, 40 W.C.B. (2d) 373, (ONCA) R v. Renaud, 2006 BCCA 526 R v. Saulnier, 3 W.C.B. (2d) 308, (BCCA) R v. Smith, 2006 SKQB 137 R v. Stonefish, 2012 MBCA 116 R v. Strickland, 2011 BCPC 102 R v. Suelzle, (2009) 2009 BCPC 15 , B.C.J. No. 98 R v. Van Rossum (25 November 2011), Vancouver 202500-2; 202500-3-C (BCPC) [33] It will not be possible to refer in detail to the facts and the sentences imposed in each of those authorities in these Reasons.

Ihave carefully considered each counsel’s positions on a fit and appropriate sentence for each of the accused, and the relevant authoritiesin light of those positions. [34] The principles and purposes of sentencing are set out in Sections 718, 718.1, and 718.2 of the Criminal Code. In

Section 718,sentencing is to achieve the following objectives: (

a) to denounce unlawful conduct; (

b) to deter the offender and other persons from committing offences; (

c) to separate offenders from society, where necessary; (

d) to assist in rehabilitating offenders; (

e) to provide reparations for harm done to victims or to the community, and (

f) to promote a sense of responsibility in offenders and acknowledgement of the harm done to victims and to the community. [35]

Section 718.1 requires the sentence to be proportionate to the gravity of the offence and the degree of responsibility of theoffender.

Section 718.2 requires a sentence to take into consideration any relevant aggravating or mitigating circumstances relating tothe offence or to the offender, to be similar to sentences imposed on similar offenders for similar offences committed in similarcircumstances, to not be unduly long or harsh if consecutive, to restrict the use of incarceration as a possible sanction, and to be the resultof considering all available sanctions other than imprisonment. [36]

Section 718.2(a) (iv) concerns a specific aggravating factor in respect of criminal organizations:: (iv) evidence that the offence was committed for the benefit of, at the direction of or in association with acriminal organization, . . . shall be deemed to be aggravating circumstances.” [37] Criminal organization is defined in

Section 2: “Criminal organization has the same meaning as in subsection 467.1(1).” [38]

Section 467.1(1) defines criminal organization. “”criminal organization” means a group, however organized, that (

a) is composed of three or more persons in or outside Canada; and (

b) has as one of its main purposes or main activities the facilitation or commission of one or more serious offences that, ifcommitted, would likely result in the direct or indirect receipt of a material benefit, including a financial benefit, by thegroup or by any of the persons who constitute the group. It does not include a group of persons that forms randomly for the immediate commission of a single offence. “serious offence” means an indictable offence under this or any other Act of Parliament for which the maximum punishment isimprisonment for five years or more, or another offence that is prescribed by regulation.”

[ 39 ]

Section 10 of the CDSA sets out the following factors to be considered: “10.

(1) Without restricting the generality of the Criminal Code , the fundamental purpose of any sentence for an offence under this

Part is to contribute to the respect for the law and the maintenance of a just, peaceful and safe society while encouraging rehabilitation, and treatment in appropriate circumstances, of offenders and acknowledging the harm done to victims and to the community.

(2) If a person is convicted of a designated substance offence, the court imposing sentence on the person shall consider any relevant aggravating factors including that the person . . . (

b) was previously convicted of a designated substance offence; . . .” [ 40 ] Counsel agree that none of the authorities provided at the sentencing hearing are directly on point. They submit they have been unable to find any sentencing authorities in Canada involving the importation of Ketamine in such a large amount, or the possession of Ketamine in such a large amount for the purpose of trafficking, or where the potential profit was in the range of $50 million dollars. [ 41 ] The Crown has provided three sentencing decisions that do involve Ketamine.

These are Ferguson , Paper , and VanRossum . [ 42 ] In Ferguson , the accused pled guilty to possession and trafficking in methamphetamine, selling Ketamine (which was a Food and Drug Act

Schedule F drug at the time), and possession of stolen property. [ 43 ] From late May 2002 until April 2003, the accused sold either Ecstasy or Ketamine on at least 10 occasions to undercover police officers, mostly in small amounts. In April 2003, he arranged to sell a half pound of Ketamine to an undercover officer. He was then arrested and marijuana, Ketamine, Ecstasy, and MDA were found in his residence. The total value of all of the drugs was less then $20,000, and the amount of Ketamine was 239 grams. [ 44 ] The accused had no previous criminal record and had no addiction issues.

An aggravating factor was that some of the drugs were sold while he was head of security at a rave concert attended by young people. He was found to be a mid-level drug dealer (para. 31). [ 45 ] He was sentenced to 2½ years as a global sentence on all counts. [ 46 ] In Paper , the accused pled guilty to 8 counts of possession for the purpose of trafficking in methamphetamine, oxycodone, codeine, Ketamine, LSD, GHB and Ecstasy. When the search warrant was executed at her residence, she had approximately 98 grams of

Schedule I drugs, of which approximately 36 grams was Ketamine. She also had 300 pills, 300 LSD tablets, 330 Ecstasy pills, 2.5 litres of liquid form GHB, approximately 220 grams of marijuana, 29 grams of hash, and 200 valium pills. The methamphetamine and Ketamine were a

Schedule I drug, the GHB, LSD and Ecstasy were

Schedule III drugs, and the valium was a

Schedule IV drug. [ 47 ] The court emphasized that the accused had set up a commercial operation, catering to a wide variety of drug users, essentially running a drug store of illegal drugs. [ 48 ] Paper was 33 years old and had no prior criminal record. She had no drug addiction issues prior to her arrest, but developed a heroin addiction subsequently. She had been a regular Ketamine user.

She came from a positive and stable family background, and had engaged in trafficking in various drugs purely for profit. [ 49 ] The court was concerned with the rehabilitation of the accused and imposed a 2-year sentence reduced by time spent in custody prior to trial to 23 months jail on each count to be served concurrently. [ 50 ] In VanRossum , the accused pled guilty to trafficking in Ketamine and trafficking in Ecstasy. The offences took place between March 2007 and June 2008, when he supplied 1.8 kg. of Ketamine and 1.3 kg. of Ecstasy or MDNA to an undercover police officer.

He received approximately $50,000. [ 51 ] The accused was 26, and from a good background. He had become dependent on using Ketamine following a motorcycle accident, as well as misusing alcohol. By the time the accused was charged and subsequently sentenced, he had begun living a productive life in the community.

The court found specific deterrence was not a factor. [ 52 ] The court sentenced the accused to 24 months, reduced after time spent in custody to approximately 16 months. [ 53 ] I am informed by the Crown that the 1.8 kg. of Ketamine in VanRossum was the largest amount of Ketamine in any criminal sentencing case that could be identified by the Crown in preparation for sentencing submissions. There are also few sentencing authorities where Ketamine alone is the drug either imported or trafficked, or both.

It is more common to find Ketamine being imported or trafficked in conjunction with other drugs. [ 54 ] The Crown has provided the decision in Bhangal . There, the court was considering a joint submission on sentence following the accused pleading guilty to one count of trafficking in opium poppy powder, known as doda, a drug used by some members of a specific ethnic community, but not a drug where there were many sentencing authorities available.

The court provided a very useful framework that can be used in determining an appropriate sentence where few sentencing authorities exist. [ 55 ] At paragraph 29, the court said:

“29 One of the principles of sentencing is that sentences should be similar for offenders who have committed similar offences insimilar circumstances: Criminal Code, s. 781.2(b). For certain crimes, including some cocaine offences, the Court of Appeal hasprovided ranges of sentence as a starting point in determining the appropriate sentence: R. v. Woolcock, [2002] O.J. No. 4927; R. v.Cunningham (1996), (ON CA), 104 C.C.C. (3d) 542; R. v. Madden (1996), (ON CA), 104 C.C.C.(3d) 548; and R. v. Hamilton, and R. v. Mason (2004), (ON CA), 186 C.C.C. (3d) 129.

Since there are no previousdoda sentencing judgments in Canada, neither of these methods of fixing the appropriate sentence is available. 30 In these circumstances, an appropriate starting point is to determine the nature of doda in comparison to other controlledsubstances to ascertain whether it is similar to other drugs for which sentences have been imposed. That determination will permit afinding where doda fits in the spectrum of controlled substances and a range of sentence to be identified.

However, as Doherty J.A. heldin Hamilton, supra, the range is in large measure a reflection of the seriousness of the crime. Once the range is identified, the judge hasto consider the mitigating and aggravating factors that could result in the sentence being above the range, below the range or wherewithin the range the sentence should be set: Hamilton, at para. 111. 31.

Those relevant factors would include: 1. the amount sold or possessed for the purpose of trafficking; 2. the amount, duration and frequency of the sales; 3. the offender's motivation; 4. the offender's position in the drug hierarchy; 5. the profit obtained; 6. the presence of any statutory aggravating factors under s. 10 of the Controlled Drugs and Substances Act: (

i) whether the offender carried, used or threatened to use a weapon, (ii) whether the offender used or threatened the use of violence, (iii) whether the offender trafficked or possessed the substance for the purpose of trafficking on or near a school ground or any otherplace persons under 18 years of age usually frequent, (iv) trafficked or possessed the substance for the purpose of trafficking to a person under the age of 18, (

v) whether the offender was previously convicted of a designated substance offence, (vi) whether the offender used the services of a person under the age of 18 to commit the offence, or (vii) involved such a person in the commission of a designated substance offence. 7. the offender's age; 8. whether there was a guilty plea or a trial; 9. whether the offender had a previous record and if so, whether he or she was bound by a probation order at the time of the offence; 10. whether the offence involved a criminal organization; 11. pre-trial custody; 12. restrictive bail terms; 13. steps taken towards his or her rehabilitation; 14. the presence or absence of remorse; 15. the impact of other penalties.” [56] A range of sentence is referred to in R v.

Bhangal, however the Crown submits there is no available range established inBritish Columbia by the British Columbia Court of Appeal. There are few Ketamine cases, and those which have been brought to myattention are utterly dissimilar to the facts in this case. The Crown also points out that although the Courts of Appeal in Ontario andAlberta have established a range of sentence for the offence of drug trafficking in specific drugs and the importation of specific drugsinto Canada, the British Columbia Court of Appeal has not done so.

The Crown submits that in sentencing these accused, caution shouldbe exercised when considering sentencing decisions for drug offences from Ontario and Alberta since the sentencing range establishedby the Courts of Appeal in those provinces will have guided the lower courts when sentencing drug offenders. [57] Although the decision in Bhangal concerned doda, or opium poppy powder, and not Ketamine, the sentencing framework setout at paragraph 30 and 31 may be usefully applied in this case.

The appropriate “starting point” indentified in Bhangal was to ascertainwhether the drug in question is similar to other drugs for which sentences have been imposed, thus allowing the court to determine wherethe particular drug fits in the spectrum of controlled substances. The Canada Gazette is a good starting point in that determination.

[ 58 ] In the Food and Drugs Act , Regulations Amending the Food and Drug Regulations (Ketamine) Canada Gazette

Part II, Volume 139, No. 19, the Regulatory Impact Analysis Statement in relation to Ketamine states: “Description: The purpose of this regulatory initiative is to remove the substance Ketamine from

Schedule F of the Food and Drug Regulations (FDR) and explicitly list it under Item14 of

Schedule I to the Controlled Drugs and Substance Act (CDSA) and Item 14 of the

Schedule to the Narcotic Control Regulations (NCR). Ketamine is non-barbiturate anaesthetic used in humans and animals. It was been listed in

Schedule F,

Part I of the FDR since at least 1995. And such Ketamine requires a prescription for human and veterinary use. In Canada, Ketamine is most commonly used as an anaesthetic for animals. Ketamine is commonly referred to as “special k”, “kit kat”, and “cat valium” on the streets, and has become popular as a “party or club drug” due to its dissociative effects; it creates the illusion of an “out of body experience”. It has also been used as a “date rape” drug. Ketamine seizures by police have been increasing in recent years.

The clandestine manufacture of Ketamine is a complex and costly process, therefore the main source of illicit Ketamine is through the diversion of legitimate pharmaceutical products. Concern expressed by health professionals and law enforcement resulted in requests to Health Canada for action to be taken to prevent the theft, diversion, and illicit use of this substance. On February 7, 2004, Health Canada published a Notice to Interested Parties in the Canada Gazette,

Part 1, with respect to a proposal to control Ketamine under CBSA and its Regulations. Further research and analysis of the scheduling options under the CDSA concluded that Ketamine is an analogue of phencyclidine (PCP) and is therefore captured under Item 14 in

Schedule I to the CDSA, and Item 14 in the NCR which states: “Phencyclidine ((1-(1-phenylcyclohexyl)piperidine), its salts, derivatives and analogues and salts of derivatives and analogues”. The CDSA defines an analogue as “a substance that, in relation to a controlled substance, has a substantially similar chemical structure”.

Section 58 of the CDSA gives priority to substances listed under its Act and Regulations, stating: “In the case of any inconsistency or conflict between this Act or the regulations made under it, the Food and Drugs Act or the regulations made under that Act, this Act and the regulations made under it prevail to the extent of the inconsistency or conflict.” Consequently, regulatory amendment is not necessary to bring Ketamine under the control of the CDSA. Nevertheless, Health Canada is removing Ketamine from

Schedule F of the FDR, and explicitly listed it under

Schedule I to the CDSA and the

Schedule to NCR to ensure that no confusion exists regarding the regulatory status of this substance, which could compromise the control over Ketamine and the health and safety of Canadians. Due to the more technical nature of this issue and the need to clarify the regulatory status of Ketamine, Health Canada requested approval for an exemption from pre-publication in the Canada Gazette,

Part I. The CDSA provides a legislative framework for the control of substances that can alter mental processes and may produce harm to the health of an individual or to society when diverted or misused. Except as authorized under its Regulations, activities such as possession, possession for the purpose of trafficking, trafficking, importation, exportation, possession for the purpose of exportation, and production of controlled substances are prohibited under the CDSA.

Regulating Ketamine under the CDSA and the NCR will enhance protection of the health and safety of Canadians by reducing the availability of this drug on the illicit market. The NCR governs the activities of producers, distributors, importers, exporters, health care professionals, and hospitals related to narcotic drugs. Depending on the activities to be carried out, persons must obtain a dealer’s licence as well as separate permits to import or export narcotic drugs.

Licensed dealers, hospitals, pharmacists and practitioners are required to provide adequate security for controlled substances in their possession and to maintain records of all movements of controlled substances into and out of their inventory. Canada is a signatory to United Nations drug control conventions, and as such has an obligation to meet international requirements.

Although Ketamine is not currently listed in any of the United Nations drug control conventions, it has been recommended for critical review by the World Health Organization’s Expert Committee on Drug Dependence with a view to determine if it should be added to the Schedules of the Conventions. A number of countries have already elected to impose strict controls over Ketamine, including the United States, Australia, Belgium, Italy, France, Greece, Luxembourg, and China.” [ 59 ] Sgt. Rintoul, who gave expert evidence in this trial, also testified as an expert witness at the sentencing hearing in Ferguson .

His evidence was summarized at paragraph 4 ff: “Cpl. Rintoul testified that Ketamine is, like ecstasy, a club drug and a Rave drug. A club drug is a drug which is utilized in a social setting. The proper use of Ketamine is in veterinary medicine as an animal anaesthetic. It is in the context of illicit use, capable of producing unique effects in users similar to that of LSD including hallucination, feelings of euphoria, and floating sensations. 5. Ketamine is often mixed with other drugs such as ecstasy.

Ketamine is taken in a powder form on the street, which in turn is either consumed orally, or inhaled through the nose or smoked.

6. Users of Ketamine can develop an addiction in that over time they require more Ketamine to get the same effect as the initial dosage. Users of Ketamine have been known to experience a sensation known as the “KK-hole” which is likened to a near death experience. 7. Ketamine is also known as a form of date rape drug in that it is knowingly used by a nefarious individuals to cause their victims to pass out thus giving rise to an opportunity to commit sexual assault. Ketamine, in that context, is water soluble.

The target market for Ketamine is youths in the ages of 18 - 22 years.” [ 60 ] The court in VanRossum refers to these passages in Ferguson at paragraph 33 . [ 61 ] In Paper , at paragraph 40 to 42 , the court described the effects of Ketamine: “40 Ketamine is another drug substance which Ms. Paper possessed for the purpose of trafficking. 41 Ketamine can produce vivid dreams or hallucinations and make the user feel as though the mind is separated from the body . This effect of "dissociation" is the effect of the related drug PCP. It gives the sensation of entering "another reality".

It is an analogue, being a substance of similar chemical structure, of PCP. Ketamine has become popular as a "party" or "club" drug due to its dissociative effects, creating an "out of body experience". It is also used as a "date rape" drug. Combining Ketamine with alcohol or other sedatives can be fatal. As a powder or liquid, it can be added to drinks. As a powder it could also be snorted or smoked with marihuana or tobacco. As a liquid it could also be injected.

If Ketamine is used regularly, the user becomes more tolerant to the effects of the drug and as a result an increased dose would be required to achieve the same effect. As an anaesthetic it may prevent feeling of pain, causing an increased risk of injury. It may cause vomiting and choking on vomit. In higher doses it may depress the central nervous system, reducing the level of oxygen to the brain, heart and other muscles and even cause death. 42 In 2005, by Federal Regulation, this drug was moved to

Schedule I of the Controlled Drugs and Substances Act to reflect the nature of the drug and concerns associated with its use. Based on its dangerousness it should be considered similar to other

Schedule I drugs such as heroin, cocaine and methamphetamine.” [ 62 ] Ketamine is a

Schedule I drug. Other

Schedule I drugs include heroin, cocaine, methamphetamine, morphine, and oxycodone. The maximum penalties for possession for the purpose of trafficking of a

Schedule I drug is life imprisonment. The maximum sentence for the importing a

Schedule I drug into Canada is also life imprisonment. This also assists in placing Ketamine into a spectrum of illegal drugs. [ 63 ] All counsel spent considerable time in submissions in attempting to place Ketamine in a hierarchy of

Schedule I drugs. Counsel for Kwok submitted that Ketamine traffickers or importers should be treated much like traffickers or importers in opium. He relied in part on sentencing authorities where the drug involved was opium. He submits that a sentence in the 8 to 10 year range, less time served, would meet the need for general deterrence and denunciation. [ 64 ] Taking into account the evidence of Sgt. Rintoul at trial, Mr. Pon’s evidence at the sentencing hearing, and the findings of the learned sentencing judges in Ferguson , Paper and VanRossum about the nature and use of Ketamine, I have determined that Ketamine can be placed in the hierarchy of

Schedule I drugs only slightly below such highly addictive drugs as heroin and cocaine in terms of the harm it causes to consumers of the drug. [ 65 ] A unique aspect of the use of Ketamine is as a means to commit criminal offences. Here I refer to the use of Ketamine as a date rape drug, where it is added surreptitiously to the food or drink of another person, thus rendering that person highly vulnerable to assault or sexual assault. This use results in serious harm to innocent members of the public.

Although not a “harm” to the “user” (unless the unsuspecting victim is (mis) characterized as a “user” of Ketamine), harm is suffered by the victim. Little qualitative difference lies in the harm self-inflicted by heroin or cocaine addicts and the harm inflicted on victims of date rape drugs. [ 66 ] Further, the societal harm caused by this type of use of Ketamine is, in my view, yet to be fully explored or understood.

Although the harm to society caused by heroin and cocaine addiction, for example, has received scrutiny and the courts have long had the benefit of many expert or scholarly opinions on the effects of such addiction n the community as a whole, as well as on the individually addicted, Ketamine is a relative newcomer in terms of analyzing or understanding the effect of such a drug circulating within the community that is capable of being used as a means to commit crimes against another person. [ 67 ] The unique use to which Ketamine can be, and has been put, pushes Ketamine back up the hierarchical scale of

Schedule I drugs due to the danger it represents to innocent members of the public when it is in the hands of what Ferguson characterized as “ nefarious individuals ”. Exactly how high up the scale is a question that must be left to be determined with the assistance of a greater body of evidence than is currently available to this court. AGGRAVATING FACTORS [ 68 ] The Crown submits that there are many aggravating factors in this case.

They include the huge quantity of Ketamine imported and its possession for the purpose of trafficking, that all three accused were solely motivated by profit, that none were themselves drug addicts or users of Ketamine, that Ketamine is designed to appeal to youth, that Ketamine is not manufactured in Canada and is not “indigenous” to this country, that none of the accused have acknowledged the potential harm to the community or to users had the Ketamine entered the community, that Kwok and Ng were involved in months of pre-planning, that all three accused were part of a inner circle of trust in relation to this criminal enterprise, that Lau has previous criminal convictions for related drug offences, and that the

commission of these offences involved a criminal organization. [ 69 ] In response to the Crown’s position that Ketamine is not “indigenous to Canada”, counsel for Lau has pointed out that the Canada Gazette indicates that the then seven current manufacturers of Ketamine in Canada would need to address the legislative changes to regulating Ketamine. Thus arguably, at least in 2005, Ketamine was being manufactured in this country. [ 70 ] There are no mitigating factors. None are youthful, none have shown any remorse, and none have taken any apparent steps towards their rehabilitation, for example.

Ng’s poor health has been considered in the context of credit for time spent in custody since his arrest. (See for example, R v. Michel (Sept. 16, 1996, Vancouver CA021253 (BCCA); R v. E.R. (July 14, 1993, Vancouver CA 014476 (BCCA). PERSONAL CIRCUMSTANCES OF THE ACCUSED [ 71 ] Kwok was born in Hong Kong and is now 60 years old. He has lived for a considerable time in the Philippines, and has a wife, adult children and grandchildren there. He has the equivalent of a Grade VII education, and worked as a waiter or in restaurants most of his life. He was convicted of a robbery when he was 15 years old in Hong Kong.

He has no drug-related record. He is not an addict. His counsel provided the North Fraser Pre-Trial Centre work evaluation for Kwok, which indicates that he has been working well in the sewing department while in custody. [ 72 ] Ng is also 60 years old, born in China, but also living in the Philippines for many years. He also has only a primary school education. His ex-wife and adult children reside in the Philippines. He worked as a trader there, and in 2000 moved to Hong Kong with his family to carry on in that business.

His counsel indicated he has been informed by Ng that he has no criminal record outside of Canada. [ 73 ] Lau is in his mid-40’s. He immigrated to Canada in 1990, and became a Canadian citizen in 1999. He is married with four children. He works in construction, earning about $3,000/month. He was convicted in 2000 of production of a scheduled substance and sentenced to 8 months in jail, and of theft of electricity and sentenced to 30 days concurrent. In 2001, he was convicted of importing a scheduled substance and sentenced to 18 months to be served under a conditional sentence order, and to one year’s probation.

He and his wife own their home and have a mortgage. His wife works as a waitress and has been present in court during some of these proceedings and the trial. His counsel submits that as a result of the van rented by Lau not being returned to the rental company on time, he incurred approximately $3,000 in costs. He spent 11 days in custody after his arrest before being released on bail. His counsel concedes that his bail conditions were not restrictive, but his wife acted as a surety to secure his release, and this has had a financial impact upon the family.

SENTENCING SUBMISSIONS ON LENGTH OF SENTENCE [ 74 ] The Crown submits that both Kwok and Ng should be sentenced to 16 years, less time spent in custody prior to trial.

The Crown submits Lau should be sentenced to 12 years, less the 11 days he spent in custody after his arrest. [ 75 ] Counsel for Kwok submits that Kwok should be sentenced to 8 to 10 years less time served. [ 76 ] Counsel for Ng submits that he should be sentenced to 6 to 8 years less time served, with an enhanced credit of 1.5 for every day spent in custody since his arrest. [ 77 ] Counsel for Lau submits that he should be sentenced in a range between 2 years less a day to 3 years, less 11 days spent in custody after his arrest.

ENHANCED CREDIT [ 78 ] Section 719 (3) of the Criminal Code states: “In determining the sentence to be imposed on a person convicted of an offence, a court may take into account any time spent in custody by the person as a result of the offence but the court shall limit any credit for that time to a maximum of one day for each day spent in custody.” [ 79 ] Counsel for Ng submits that Ng should receive enhanced credit pursuant to Section 719 (3.1).

That subsection reads: “ Despite subsection (3), if the circumstances justify it, the maximum is one and one-half days for each day spent in custody unless the reason for detaining the person in custody was stated in the record under subsection 515 (9.1) or the person was detained in custody under subsection 524 (4) or (8).” [ 80 ] He has provided the decision in R. v. Stonefish 2012 MBCA 116 which dealt with the issue of when circumstances might justify an award of enhanced credit. In a lengthy decision, the court set out its conclusion at paragraph 109 following: “ 109 . Credit for PSC is discretionary.

However, as a general rule, credit as set out in s. 719(3) of the Code on a 1:1 basis should be given for time spent in custody prior to sentencing, unless there is some good reason for denying it (see, for example, English at para. 28). On the other hand, enhanced credit on a 1.5:1 basis, as set out in s. 719(3.1) of the Code, may be given when the accused can show, on the balance of probabilities, that the circumstances justify it, in their individual case.

110. The circumstances that may justify enhanced credit in s. 719(3.1) of the Code do not have to be exceptional. The language of the statute does not expressly refer to exceptional circumstances. In this conclusion, I agree with the Nova Scotia Court of Appeal’s decision in Carvery. 111. Loss of ability to earn remission and statutory release may be a circumstance that a court could take into consideration when exercising its discretion to award enhanced credit. Just because the vast majority of prisoners receive remission or parole does not make these events universal.

The fact that evidence could be adduced in a large number of cases to justify the awarding of enhanced credit in no way detracts from the justification for awarding such enhanced credit in the individual case. Where the accused can bring evidence of good behaviour on remand so that it would appear that had he been a sentenced prisoner he would have received credit for remission, then the loss of remission is transformed from a universal characteristic to one personal to each offender, thus bringing it within the ambit of s. 719(3.1) of the Code. 112. It is important to note that this

interpretation is in keeping with the legislative history and with the fundamental principle of sentencing, which is that of proportionality. If offenders are not granted 1.5:1 PSC credit, they will end up serving more time than similarly situated offenders who did not serve any time in PSC. Two accused charged and convicted of the same crime and otherwise equally culpable and in otherwise similar circumstances would spend different amounts of time in custody if one remained in PSC while the other received bail.

This would have particularly detrimental effects upon the disadvantaged and, in particular, against aboriginal accused. 113. The onus of proof under s. 719 of the Code on the balance of probabilities should rest on the party seeking to use a ratio other than 1:1. Thus, the onus should be on the Crown on the balance of probabilities to show cause why credit should be denied or given on less than a 1:1 basis. The onus for enhanced credit beyond 1:1 is on the accused. 114. In both cases, where the general rule of 1:1 is departed from, evidence should be brought to justify the departure.

Given the relaxed evidentiary rules in a sentencing hearing and in an attempt to avoid clogging the courts any more than is necessary, credible information and/or hearsay evidence may be tendered, as is the case when other issues are disputed in a sentencing hearing.

The accused must demonstrate by credible information or adduced evidence that the enhanced credit ought to be applied in his or her case.” [ 81 ] Ng gave evidence in relation to receiving enhanced credit pursuant to Section 719(3.1). [ 82 ] Ng testified that prior to his arrest on December 11, 2010, he suffered from diabetes, high blood pressure, and that he had had a stroke in March 2008. After his stroke, his speech was affected and the right side of his body was “ not that convenient ”. This resolved approximately a month later through physiotherapy treatment.

At the time of his arrest, he didn’t have much pain or health problems still remaining from his stroke. Since his arrest, his diabetes exacerbated a problem with one of his eyes. He received medical attention and treatment for that, including four surgeries. His vision is now blurry in that eye. He took high blood pressure medication before his arrest and has continued to do so while in custody. [ 83 ] On June 23rd, 2012, while being transported back to the North Fraser Pre-Trial Centre for a court appearance, Ng testified that he fell as he was getting out of the transportation van.

At the time, he was in leg irons, and handcuffs. A sheriff helped him to his feet and asked if he was hurt. Ng said no, not much. He was put in a wheelchair to be moved back to his cell. At the time, he didn’t feel pain, but about a week later, he couldn’t sleep because of pain. The pain remained for almost three months. He was given medical attention and prescribed pain killers. About a month after the fall, Ng noticed that his left hand and left foot were affected. Partly due to his poor vision in one eye, and the weakness that he attributes to the fall, Ng testified he is afraid of falling again.

He believes that the fall pressed on a nerve, and that surgery might be required. Approximately four months after the fall, he was taken for a CT scan. He was not able to say what the results of the CT scan were. [ 84 ] Counsel for Ng submits that exceptional circumstances are not required, but the individual circumstances of Ng should be considered. He submits Ng’s evidence about his state of health and the fall are both credible and relevant to a Section 719(3.1) analysis.

He also submits that delays in concluding the trial, due to equipment failures and the unavailability of judge time in Richmond, resulted in Ng being brought back and forth between the Pre-Trial Centre and court more frequently. [ 85 ] The Crown submits in response that the only relevant period of delay to be considered for enhanced credit is any delay occurring between the day of the finding of guilt and the imposition of sentence upon an accused. Where that delay is not attributable to the accused, there might be justification for enhanced credit.

In this case, the Crown concedes that both Kwok and Ng should receive enhanced credit from the date of the decision, September 28, 2012, to the date of sentencing. [ 86 ] In relation to Ng’s health issues and the fall, the Crown submits there are no precedents where an accused’s health while in custody was the basis for a denial or allowance of enhanced credit for time spent in custody prior to sentence.

Should this court determine that enhanced credit is appropriate, the Crown submits that it should only be granted in relation to Ng’s fall while in custody; that is, from June 23 rd , 2012 to the date of sentencing. [ 87 ] Considering the evidence from Ng in relation to his position that the circumstances justify enhanced credit for the time he has spent in custody due to his health and the fall, and bearing in mind the analysis in R v. Stonefish , I find that the circumstances justify an enhanced credit for Ng for the period from June 23 rd , 2012 to the date of sentencing.

I do not find that circumstances exist justifying enhanced credit due to Ng being brought back and forth to court multiple times, or in relation to his pre-existing health issues. Prior to his arrest, Ng was suffering from diabetes, high blood pressure, and had had a stroke. These are pre-existing medical conditions for which he received appropriate medical attention and treatment while in custody. His vision problems and the surgeries cannot be attributed to his being in custody, although they occurred during his time in custody.

I accept his evidence that he fell as described on June 23 rd , 2012, and in particular that at the time he was in leg irons and handcuffed. Ng’s own evidence is very unclear as to his prognosis, or any medical conclusion or diagnosis in relation to the long-term effects of the fall. However, the discretion granted to the court under Section 719(3.1) of the Code is broad. I find that Ng has met the burden of showing why enhanced credit should be given

for the time from June 23 rd , 2012 to the date of sentencing. [ 88 ] Ng will receive enhanced credit for the period June 23 rd , 2012 to the date of sentencing. Kwok will receive enhanced credit from the date of Decision, September 28, 2012 to the date of sentencing. [ 89 ] In response to the Crown’s submissions that all three accused in this case were involved in a criminal organization as defined in

Section 467.1(1) and that

Section 718.2(8)(iv) applies, counsel for Ng submitted that, although there were three or more people involved in this criminal enterprise that may have benefited one of them, this was not a formal organization. He submits it was more like a conspiracy than a criminal organization. He submits there is no evidence Ng knew the extent of the criminal organization or where the Ketamine would end up. [ 90 ] In my view, the evidence has established that Kwok, Ng and Lau fit squarely within the definition of criminal organization set out in

Section 467.1(1) of the Criminal Code . It is not a requirement that it be proven for the purposes of sentencing and s. 467.1(1) and s. 718.2(8)(iv), that each member of a criminal organization be cognizant of every aspect of that criminal organization’s activities, or that any single member know the full extent of the organization. This aggravating factor applies to these accused. [ 91 ] At sentencing, courts have often taken note of the age and level of maturity of the offender.

As for example in LePage , where at paragraph 23 , the observations of the trial judge who had convicted the accused for conspiring to import cocaine and conspiring to traffic in cocaine were set out: “[23] In the concluding part of her reasons on sentencing, the judge made observations about the three accused and the nature and effect of the crimes they had committed, as follows: [94] All the accused are intelligent adults. They are not young, vulnerable or naive.

They were always aware of the huge risks they were taking, yet knowingly and willingly exposed themselves to them. [95] Motivated by profit, the accused had no moral reservations about their activities and the destruction they would cause. Importing and trafficking in drugs causes misery to addicts to their families and it spawns further and other crimes of all sorts. Much serious crime is drug-related. It touches all our society. And these three men imported a very large quantity of cocaine, and planned on importing more. (emphasis in original) [96] They know the law.

They knew they faced severe, lengthy jail sentences if they were caught. They have been caught. They must be sentenced severely.” [ 92 ] The accused in this case were similarly mature adults at the time they engaged in this criminal enterprise. All three were family men, with children or grandchildren. Kwok and Ng were apparently businessmen in the Philippines and Hong Kong, and Lau owns a home in this community and has been steadily employed for a number of years since coming to Canada.

There is no reliable evidence, or even sufficient evidence from which a rational inference could be drawn, that financial pressures caused any of the three accused to involve themselves in these offences. Although the evidence reveals that Kwok and Ng lived modestly after arriving in Canada, this is not evidence of either of them being driven to commit these offences because of financial need. I have already rejected virtually the entirety of Kwok’s viva voce evidence at trial on the basis that it was a pack of lies.

This includes his testimony about his financial situation. [ 93 ] Although the larger the quantity of an illegal drug introduced into the community, the greater the harm to that community (particularly a

Schedule I drug), in Epp , at paragraph 18 , the court addressed the issue of whether a very large quantity of drugs should result in a very much higher sentence: “ [18] I have difficulty with the implied proposition at para. 15 of the reasons of the sentencing judge in the present case that double the quantity of cocaine should result in a much higher sentence for Mr. Epp. In my opinion, the quantity of the drug involved, particularly when tens of kilograms are involved, although a factor in sentencing, should not be over-emphasized. Mr. Epp and Mr.

Sandhu both committed very serious offences deserving a substantial penitentiary time and there is not much to differentiate their criminality. In one respect Mr. Sandhu’s conduct was more egregious because he also was involved in the laundering of money. [19] One way of measuring the degree of culpability of transporters of cocaine is to look at sentences of those high-level importers of bulk cocaine who, directly or indirectly, might be employers of people such as Mr.

Epp.” [ 94 ] The court then went on to note the sentences imposed upon key players in high volume cocaine importing and distribution conspiracy cases in British Columbia, and to find that Mr. Epp’s role as a transporter of cocaine was “ somewhat less egregious ” than that of high-level importers and traffickers. Specifically, the court noted the decision in R v. Vukelich 1994 BCJ No. 3338 (SC) , where an effective sentence of 18 years was imposed for importing at least 100 kilograms of cocaine.

The sentence of 14 years was reduced to 10 years, with the court making special note of the strong family support for Mr. Epp, his early guilty plea, lack of criminal record, his relatively youthful age, and his cooperation with police. I note that in this case, none of those factors or personal circumstances pertain to any of the three accused, save that Lau’s wife has been in court from time-to-time, and that Ng has no previous criminal history. [ 95 ] Some of the authorities provided dealt with large quantities of

Schedule I drugs. For example, in Kang , the court imposed two concurrent terms of 8 years imprisonment for possession of cocaine for the purpose of trafficking and importation of cocaine. Approximately 100 kilograms worth nearly $3 million dollars had been brought in by the offender, hidden in his truck/trailer unit. He had no prior criminal record, and the court found that specific deterrence was a lesser consideration, given the salutary effect of the criminal prosecution upon the offender and his family. The court commented on the amount of drugs involved and the length of sentence to be imposed at paragraph 38:

“. . . However, I do find that, firstly, the amount of drugs involved here, while a factor and certainly an aggravating factor, does notgovern in such a way as to operate as a tariff, thereby lifting the sentence from what it might otherwise be solely on the amount that thisload of cocaine exceeds loads in otherwise similar cases.” [96] Of the authorities provided to me, the most similar in terms of its facts is that of R v. Pedersen and Hernandez. Pedersen andHernandez were found guilty of possession for the purpose of trafficking of over 1,000 kilograms of cocaine.

They had sailed in asailboat owned by Petersen, up the Pacific Coast. They attracted the attention of the authorities when the sailboat was off the north endof Vancouver Island. It was surveilled, and seen travelling in the waters around Port Hardy. The sailboat remained offshore, and aZodiac type of boat travelled between the beach and the sailboat several times. FLIR technology revealed that a person remained onshore, and two persons remained on the sailboat. The sailboat then proceeded to dock in Port Hardy. Pedersen was arrested there. Hernandez was on board.

The cocaine, valued between $26 million and $70 million, was found concealed in duffel bags on the beach. The Zodiac was found nearby. [97] Pedersen was 40 years old, a commercial diver, and although he had family in Victoria, had lived in the Caribbean in the lastfew years. Hernandez was a shrimp fisherman in Mexico, and was 39 years old at the time of the offence.

There was no evidence beforethe court about how either Petersen or Hernandez became involved. [98] The court in Pedersen and Hernandez treated the importation of the cocaine as an aggravating factor when sentencing themfor possession of cocaine for the purpose of trafficking. “[35] Although the offence before the court is possession for the purpose of trafficking, I should consider the importation of the druginto Canada as an aggravating factor. In that regard, I have considered the words of MacFarlane J.A. in R. v. Ramirez (1986), (BC CA), 26 C.C.C. (3d) 258 at 261 (B.C.C.A.), as follows: [13] . . .

I understand the Crown to be saying, and I agree, that the fact of importing is an aggravating circumstance in the case, eventhough the charge is not for importing but is for trafficking or possession for the purpose of trafficking. [14] We have said in importing cases, and we have said in other cases, that a drug which is native to Canada ought not to be broughtinto this country. It is a very serious matter for persons to do so.

If they persist in doing so then that is a circumstance of considerableimportance when one is considering what is a fit sentence in a particular case.” [99] The court found that Pedersen and Hernandez were “couriers of the most sophisticated sort” and that the very nature of thatoffence required a high degree of planning and deliberation. The coast that was being patrolled that evening by the PAL flight is isolatedand challenging geographically and as noted by the Crown: “It is only luck that caused this shipment to be intercepted and seized.

Iconsider all these factors aggravating.” [100] Pedersen and Hernandez were each sentenced to 16 years less time served. [101] Pedersen and Hernandez was concerned with cocaine trafficking, not Ketamine importation and trafficking (para. 103). Although the accused in Pedersen and Hernandez were not charged with importing, but rather charged with possession for the purposeof trafficking, the circumstances of that offence are similar to the fact of the present case. Over 1,000 kilograms of a

Schedule Isubstance valued in the same range of the substance as in the case at bar, was brought from another country into Canada by sea. Littlewas known about the offenders and there were no mitigating circumstances, as the court noted at paragraph 27: “There is no acceptance of responsibility, or remorse, or any acknowledgment of the harm done to communities by illicit drugs such ascocaine. ” [102] The facts of this case indicate that Kwok and Ng were much more involved in setting up this criminal enterprise than Pedersonand Hernandez were found to be by the sentencing judge, who described them as “couriers”.

Kwok and Ng were much more thancouriers. Nor were the roles played by Kwok and Ng similar to those of the drivers of transport trucks entering Canada through a landcrossing, such as in Epp, Kang, Johal, and Suelzle, for example. The circumstances of the importation of the Ketamine in this case aresimilar to those in Li. [103] In Li, the accused had been found guilty and sentenced to 13 years for five drug-related offences, including importation of aprecursor chemical used for the manufacture of Ecstasy, and possession for the purpose of trafficking of cocaine, marijuana, andEcstasy.

The precursor was imported into Canada in a marine shipping container from China, and disguised as soy sauce. Surveillanceof the container after its arrival in Richmond led to Li’s arrest. Li had been seen at the storage facility where the precursor had beendelivered, and was found to be in possession of shipping invoices and customs clearance documentation for the shipment. The potentialvalue of the precursor if combined with other chemicals to manufacture Ecstasy was between $117,000 and $230,000. The value of allthe drugs, as well as the precursor, was in the range of up to $12 million dollars.

The issue on the sentencing appeal revolved around thequestion of whether the sentences imposed by the trial judge for each of the five offences should be served concurrently orconsecutively. The Crown had sought a jail term of 16 years less time served in total for all the offences, with the precursor offences tobe served consecutively to the PPT offences. The accused had sought concurrent sentences for all offences, and with time served, aresultant sentence between 5 and 7 years. The maximum sentence for unlawful importation of a precursor at the time was 10 years. Atparagraph 30, the court noted: “. . .

The trial judge imposed an effective sentence of seven years and ten months for this offence (the precursor importation offence),and an actual sentence of seven years after crediting Mr. Li with ten months for his pre-sentence custody.”

[ 104 ] The court went on to consider submissions on whether a precursor chemical importation should be treated more leniently than the importation of the drug itself, or a narcotic drug. At paragraph 33: “ [33] In this case, the trial judge viewed the circumstances of Mr. Li’s offences as very serious. In that regard, he considered the following aggravating factors: (

i) the volume of MDP2P imported; (ii) the potential profit if the MD2P2 were converted into ecstasy; (iii) the lack of legitimate commercial application of the MDP2P chemical; (iv) the importation of MDP2P as part of a larger and highly sophisticated drug operation with Mr. Li as the central figure; and (

v) the motive for the importation scheme being Mr. Li’s financial gain. In addition, the trial judge considered Mr. Li’s prior criminal record of other economic or profit-motivated offences, the fact that Mr. Li was on bail for a charge of production of marihuana at the time these offences occurred, and the fact that Mr. Li had breached his conditional sentence order for the production of marihuana offence while on bail for these offences. [34] In my view, the trial judge undertook a careful balancing of the principles of sentencing in arriving at a sentence of seven years for the importing offence.

While he considered the principles of denunciation and deterrence to be of paramount importance given the sheer magnitude of the scheme and Mr. Li’s central role in it, the trial judge did not ignore Mr.

Li’s potential for rehabilitation in arriving at a sentence that was considerably lower than the maximum. . . .” [ 105 ] The sentence of seven years for importation of the precursor for the manufacture of Ecstasy was upheld. [ 106 ] After canvassing the findings of the trial judge about the key role played by Li, the court commented at paragraph 55: “ The sheer volume of both the Precursor Offences and Drug Possession Offences, and the staggering potential profit associated with both sets of offences, belies his attempt to minimize the severity of his conduct.” [ 107 ] The thirteen year global sentence was upheld. [ 108 ] In R v.

Bacon , 2012 BCSC 983 (sentence appeal scheduled to be heard April 2013), the accused was being sentenced for conspiracy to trafficking cocaine relating to an importation of 100 kilograms of cocaine worth between $3 to $4.2 million. At paragraph 21, the Associate Chief Justice of B.C. Supreme Court stated: “[21] I am in general agreement with Mr. Ray’s submission that, at least in relation to

Schedule 1-Drugs, the offence of importing (and, by extension, conspiracy to import) is an offence of greater gravity than trafficking (or, by extension, conspiracy to traffic). That point was made in R v. Sandhu, 2003 BCSC 2033 , at para. 18 , where Williams, J. held, in part, as follows: The courts recognize importing as an offence of greater gravity than trafficking in the substance. That point was articulated by Mr. Justice Seaton in R. v. Saulnier [ [1987] B.C.J.

No. 2497 (BCCA) ]: The additional element of introducing drugs into Canada is a valid reason for thinking that importing is a more serious offence than trafficking. As a new scale of sentences for importing evolves it will indicate higher sentences than are found in trafficking cases. Numerous other decisions affirm this proposition. [22] Similarly, in R v. Hein, [2008] B.C.J. No. 978 (BCCA) , the Court held, in part, at para. 28: It is true that the courts treat importing of cocaine more [seriously] than trafficking: see, for example, R. v. Saulnier [citation omitted]. [23] In R. v.

Eshghabadi , [2009] B.C.J., Madam Justice Wedge noted: Clearly, as Saulnier states , importation is more serious than trafficking . . . [24] In R. v. Ma , 2005 BCSC 493 , relied on by the Crown, Madam Justice Holmes acknowledged that courts “have described importing as more serious than possession for the purposes of trafficking ...[but] any binding authority has done so in the context of

Schedule I – Drugs”. Cocaine is, of course, a

Schedule I drug. [25] Thus, I accept a general proposition that the importation of large quantities of cocaine into Canada is regarded by the law as a more serious offence or, to use the words of s. 718.1 , an offence of more gravity than the offence of trafficking. Accordingly, offences of importing or conspiracy to import attract a higher range of sentences than offences of trafficking or conspiracy to traffic. [26] The introduction of a drug not otherwise available into Canada is a foundational step in the process by which its toxic effects spread throughout the community.

Treating importation more severely than trafficking is logically conducive to abating the great social harm inflicted by those drugs.” [ 109 ] Although the sentence imposed in R v.

Bacon is under appeal, the comments by the learned Associate Chief Justice Cullen assists in focussing the analysis in this case. [ 110 ] I now turn to the sentence to be imposed on each of the accused, bearing in mind that the amount of the Ketamine and its value should not be over-emphasized while recognizing that a truly deterrent sentence must clearly convey a message that the possible profit to be realized is not worth the risk taken. The circumstances set out above have been considered as they may apply to each of these three

accused, as well as the following specific circumstances. LAU [ 111 ] Lai picked up Kwok and Ng at the Vancouver International Airport in a green Mazda MPV after they had been allowed to enter Canada. Lau was seen in company with Lai in and around the MPV on several occasions subsequently, and prior to his arrest. On December 8 th , Lau drove the MPV and picked up Lai. The MPV was later seen parked at the Oakridge Mall, and Lai, Lau, and Ng were together at the food court there. On December 10 th , the MPV was parked outside a restaurant on Main Street.

Lai, Lau and Wing Ho Chu were sitting together inside the restaurant. Later that afternoon, as the container was being unloaded into the Viking Way warehouse by the labourers provided by VTG with Chan and Kwok present, Lau was driving Lai in the MPV as they watched the unloading. On December 11 th , Lau rented a cargo van, using his own credit card. He drove back and forth that day between the Viking Way warehouse and the Rowan Place warehouse, as he and Kwok transferred the boxes from one warehouse to the other.

Lau was inside the Rowan Place warehouse while Lai was out purchasing scales, packing tape, packages of latex gloves, etc., and putting them in the trunk of his Mercedes. Under the circumstances of this case, the only rational inference to be drawn is that these items were to be used in re-packaging the Ketamine for distribution. Lau, Ng, Chan and Kwok had been inside the Rowan Place warehouse with the boxes for about two hours before they were picked up by Lai in his Mercedes and taken to a restaurant for a group meeting.

Lau was there with the group for about an hour before they returned to the Rowan Place warehouse. Lau made a couple of trips in the van, removing the boxes from the Rowan Place warehouse and returning them to the Viking Way warehouse with Kwok. He was inside the van and parked outside the Viking Way warehouse at the time of his arrest. Some of the shipment boxes were inside the Viking Way warehouse. The boxes had been separated by the color of the strapping, which differentiated the boxes containing Ketamine and coffee mugs from those containing coffee mugs only.

It was Lau and Kwok who had brought the boxes back to the Viking Way warehouse and who must have arranged them in this way. Some of the boxes had been opened and the contents shifted. The Rowan Place warehouse was found to contain considerable discarded Styrofoam, strapping, and packing material.

The back room contained a pill press, multiple ziplock plastic bags, scales, a coffee grinder and small amounts of various drugs including MDMA, methamphetamine and ephedrine. [ 112 ] Although Lau’s position in the criminal enterprise hierarchy may have been lower than that of some of the others involved, he was clearly a trusted member beyond merely handling and transporting the Ketamine. He remained in the Rowan Place warehouse for hours with the others while the boxes they thought contained the Ketamine must have been opened and the sugar substitute discovered.

He was part of the group present at the restaurant immediately afterwards. It is reasonable to infer that a discussion took place there about what to do after the sugar had been found instead of Ketamine, given that the boxes were then immediately moved back to the Viking Way warehouse. This was done by Lau and Kwok. [ 113 ] This criminal enterprise could not have been carried out without someone acting in the role that Lau played over the course of several days. Any criminal hierarchy involves those at the top, those at the bottom, and others in between.

Lau’s role was not as significant as that of Kwok and Ng, but he was more than merely hired help at the very lowest level of this group. His being with Lai without Kwok or Ng on several occasions, his being present at what must have been an “insiders” meeting in the Rowan Place warehouse when the sugar substitute was discovered, and then being at the restaurant when the decision was made to hastily return the boxes to the Viking Way warehouse, as well as his activities in moving the boxes from place to place, are all indicative of his being firmly embedded as a mid-level participant.

It is also significant that it was Lau’s name and telephone number that Chan gave to the CBSA officers when he was having difficulty gaining entry into Canada after his arrival at YVR. [ 114 ] I find that Lau was a member of a criminal organization, and that this is an additional aggravating factor to be considered at his sentencing. Further, Lau’s previous criminal convictions for production of a scheduled substance, theft of electricity, and importing a scheduled substance, indicate that specific deterrence should be given some significance at his sentencing.

Denunciation and deterrence, including specific deterrence in this instance, are the primary considerations when sentencing Lau. The possibility of his rehabilitation must be allowed for. KWOK [ 115 ] Kwok was in India for the purpose of purchasing the coffee mugs as cover for the importation of the Ketamine into Canada. He was there at the same times as Chan and Ng, and played a key role in putting together the shipment.

On his entry into Canada, it was Kwok who was carrying the shipping documents, the coffee mug invoices, packing lists, various emails with innocent third parties facilitating the shipment, the hotel arrangements for himself and Chan, and other records pertaining to this entire criminal enterprise. After his arrival in Canada, he stayed with Chan and Ng in the same hotel room, and was always in either their company or the company of others associated with this criminal enterprise. He was the person who dealt with VTG for customs clearance of the shipment and who paid in cash for services provided.

He was a participant in the leasing discussions with the landlord of the Viking Way warehouse. The circumstances about Lau and Kwok’s moving of the boxes between the two warehouses and what was found in the Rowan Place warehouse set out above pertain as equally to Kwok as they do to Lau. [ 116 ] I have not considered Kwok’s untruthful testimony at trial as an aggravating factor, but have considered the factors identified in Bhangal that apply to Kwok at his sentencing and the paramount considerations of deterrence and denunciation.

This criminal enterprise involved a high degree of planning, organization and deliberation over a very long period of time. Kwok was a principal in this criminal organization and its plan to import and traffic Ketamine. The evidence from the Rowan Place warehouse and the trunk of the Mercedes indicate that he was also a hands-on participant in the planned distribution of the Ketamine. The only reason he was involved was for profit. The potential for financial gain was massive.

Kwok’s conduct while in custody as evidenced by the North Fraser Pre-Trial Centre work evaluation indicates he is a good candidate for rehabilitation, and I take that into account in imposing sentence. NG [ 117 ] Ng was in India at some of the same times as Chan and Kwok. Ng was in physical contact with the packaged Ketamine before it was shipped to Canada. While in Canada, he stayed in the same hotel room with Chan and Kwok, and was seen constantly in their

company or in company with Lau and Lai. Ng was at the warehouse when the motion detector hidden in the shipment was activated, and participated in the movement of the boxes between the two warehouses. He was inside the Rowan Place warehouse with the others on December 11 th , and at the group meeting at the restaurant that day. Upon his arrest, he was found to have a piece of paper with “Viking Way 2633” written on it in English. Many of my comments in relation to Kwok about the degree of planning involved in this scheme and the potential profit had it succeeded also apply to Ng. Ng was a principal in this criminal organization and in the plan to import and traffic the Ketamine. [ 118 ] In

summary: (

a) Ketamine falls somewhere below heroin and cocaine, but above opium or doda in the spectrum of

Schedule I drugs due to its unique properties as a means to commit criminal offences against unsuspecting ingesters of the drug; (

b) The amount of Ketamine in this case was approximately 1,000 kilos. (

c) Liquid Ketamine might be legally available in Canada, but powdered Ketamine is not. This case involved powdered Ketamine that would not otherwise have been available in Canada. (

d) The target for the Ketamine, had it been trafficked as planned, was young people. (

e) The Ketamine was to be pressed into pills, likely combined with other substances including methamphetamines, ecstasy or any of the drugs found in the Rowan Place warehouse, such that users of the pills would not know what they were ingesting. (

f) Lau, Kwok and Ng were solely motivated by profit. (

g) The value of the Ketamine might have been as much as $50 million. (

h) Kwok and Ng were equal principals in the criminal organization and travelled to India from Hong Kong to obtain the means to import the Ketamine into Canada, having engaged in a sophisticated scheme over a period of many months’ planning. They acted far more than as mere couriers bringing the Ketamine into Canada. (

i) Lau played a lesser but essential role once the Ketamine was delivered to the warehouse and thereafter. He was Chan’s first contact in Canada. (

j) Lau has been convicted previously of designated substance offences. (

k) Lau, Kwok and Ng are all mature adults in late middle age, with no addiction issues. (

l) None have shown or expressed any remorse or insight into their actions. (

m) Lau, Kwok and Ng were part of a criminal organization. (

n) Lau’s bail terms since his release have not been restrictive. (

o) Kwok and Ng have been in custody since their arrests. (

p) None have taken any steps towards rehabilitation although Kwok’s conduct while in custody supports an inference he might be a good candidate for rehabilitation. [ 119 ] I sentence Lau to ten (10) years less time spent in custody subsequent to his arrest for possessing the Ketamine for the purpose of trafficking. I make the ancillary orders sought by the Crown, t

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