Abraham v District Court at Auckland HC Auckland CIV 2006-404-007599

[2007] NZHC 1846

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2006-404-007599

UNDER  the Judicature Amendment Act 1972

IN THE MATTER OF     an application for judicial review

BETWEEN  WIREMU PIKITEKAHA ABRAHAM Plaintiff

ANDDISTRICT COURT AT AUCKLAND First Defendant

ANDCOMMISSIONER OF INLAND REVENUE

Second Defendant

Hearing:         30 April 2007

Appearances: P Davey for the plaintiff

N Malarao for the second defendant

Judgment:      15 June 2007

JUDGMENT OF STEVENS J

This judgment was delivered by me on Friday, 15 June 2007 at 4pm pursuant to r 540(4) of the High Court Rules.

Registrar/Deputy Registrar

Solicitors/Counsel:

Crown Solicitor, PO Box 2213, Auckland

Crown Law Office, PO Box 2858, Wellington

P Davey, PO Box 3320, Shortland Street, Auckland

ABRAHAM V DC AT AUCKLAND AND ANOR HC AK CIV 2006-404-007599  15 June 2007

Table of Contents

Para No

Introduction  [1] Procedural background  [7] Factual background  [23] The decision of the District Court  [35] Course of review hearing  [38] Scope of judicial review  [39] Relevant statutory provisions  [42] Principles governing applications to withdraw pleas  [46] Interpretation of s 204 of the SP Act  [56] Submissions for the IRD  [59] Submissions for the plaintiff  [71] Discussion              [78] Are the convictions a nullity?  [84] Is there a clear defence?  [90] Interests of justice  [93] Miscarriage of justice  [95] Result  [98]

Introduction

[1]      This is an application for judicial review of a decision of Judge Gittos in the District Court at Auckland declining an application by the plaintiff Mr Abraham for leave to withdraw pleas of guilty to certain charges under the Tax Administration Act 1994.   Such applications for leave are dealt with under s 42 of the Summary Proceedings Act 1957 (the SP Act) and involve the exercise by the District Court Judge of a broad discretion, one that is, on the authorities, to be exercised very sparingly.

[2]      The issue for determination on judicial review is whether the plaintiff has made out any of the traditional grounds that would require the High Court to intervene in respect of the exercise by the District Court of its statutory power of decision under s 42 of the SP Act not to grant leave to Mr Abraham to withdraw his pleas of guilty.

[3]      What takes this case outside the norm is the fact that the charges brought against Mr Abraham, and to which he entered pleas of guilty, are punishable by more than three months imprisonment.  This means that there is an election (if the charges

were to proceed on a defended basis) between trial by jury or summary jurisdiction. It is common ground that, when Mr Abraham entered pleas of not guilty to the charges in November 2004, there was no notation on the District Court file that he had elected summary jurisdiction.  The same is the case when, following receipt of written instructions that Mr Abraham would plead guilty to the charges, his counsel entered pleas of guilty on his behalf in May 2006.

[4]      The position is further complicated by the fact that Mr Abraham’s counsel who advised him prior to the entry of guilty pleas have no specific recall about advising  him  of  his  right  of  election.     Hence,  it  is  common  ground  that Mr Abraham’s assertion that he was not so advised is to be accepted as correct.

[5]      The first defendant in the review was the District Court.   This party was granted leave to withdraw, and was not represented at the hearing, but will abide the decision of the  Court.    The  second  defendant  was  the  Commissioner  of  Inland Revenue (IRD) who brought the charges.

[6]      This case concerns the interaction between s 42 of the SP Act (leave to withdraw guilty plea), s 66 of the SP Act (the defendant’s right of election) and s 204 of the SP Act, which prevents proceedings being questioned for want of form.  For the reasons which follow, the application for judicial review is dismissed.  There is no order for costs.

Procedural background

[7]      For the purposes of the review, the parties were helpfully able to settle an agreed statement of facts relating to the record of proceedings in the District Court. Such statement of facts is adopted for the purpose of this judgment and is as outlined below.

[8]      Mr Abraham is a truck driver.  In 1995, he incorporated a company by the name of W Abraham Holdings Limited (the company) for the purpose of carrying on a trucking business.  He was a shareholder together with other members of his family

and was the sole director of the company.  The company was registered for Goods and Services Tax (GST).

[9]      On 1 April 2004, the IRD commenced a criminal prosecution in the Marton District Court by laying summary informations against Mr Abraham and the company.  The informations against the company have since been withdrawn as the company has been struck off.  The informations against Mr Abraham, which contain

18  charges  (the  charges),  allege  that  Mr  Abraham  committed  offences  against s 148(1) of the Tax Administration Act in that he aided the company in knowingly filing false GST returns to the IRD.   The returns were false in that income from transport operations was omitted, with the intent of evading the assessment of GST particularised in the informations.  There were six charges in respect of each of the periods 31 May 2000 to 31 March 2001, 31 May 2001 to 31 March 2002 and

31 May 2002 to 31 March 2003.  The total amount of GST said to have been evaded between 31 May 2000 and 31 March 2003 was $81,431.66.

[10]     Mr Abraham was not able to be served with the charges.  On 2 July 2004, he appeared in the Auckland District Court on unrelated matters.  On that date, an order was made by consent for the charges to be transferred from the Marton District Court for hearing in the Auckland District Court on 13 August 2004 and Mr Abraham was remanded to the same date.

[11]     On 13 August 2004, Mr Abraham was remanded by consent without plea to

26 October 2004.  This was to allow disclosure to be provided by the IRD and for Mr Abraham to seek legal advice.  On 26 October 2004, Mr Abraham was granted a further remand without plea to 2 November 2004.

[12]     On or about 2 November 2004, Mr Abraham entered not guilty pleas to the charges and was remanded to a status hearing on 30 November 2004.  Mr Abraham was not represented by counsel at the hearing on 2 November 2004 and it is accepted that he was not advised by the Court of his right to elect trial by jury in accordance with s 66(2) of the SP Act.

[13]     At the status hearing on 30 November 2004, Mr Abraham (still  without representation) was remanded to a half day defended hearing on 11 April 2005.  He was advised by the presiding Judge that it was very important that he obtain legal advice as soon as possible as he was at risk of imprisonment.

[14]     On 11 April 2005, the IRD was ready to proceed.  A solicitor, Mr Cameron from D G Law, appeared for Mr Abraham and sought an adjournment of the hearing. This was on the basis that he had only just been instructed and that, as the matter was not within his expertise, another counsel was to be instructed.   The matter was “reluctantly” adjourned by the presiding Judge and Mr Abraham was remanded to another status hearing on 27 April 2005 for counsel to be properly instructed and to be present on that date.

[15]     On  27  April  2005,  Mr  Cameron  again  appeared  and  Mr  Abraham  was remanded to a half day defended hearing on 4 July 2005.  The presiding Judge said that the matter would definitely proceed on 4 July 2005.

[16]     On 1 July 2005, the Friday before the Monday 4 July 2005 defended hearing, the matter was brought before the Court.  Ms Tracy Spencer, a barrister employed as a “Barrister Associate” by Mr Geoffrey Clews, Barrister, sought an adjournment of the defended hearing on the basis that they had only recently been instructed to act for Mr Abraham.  The adjournment application was declined.

[17]     On 4 July 2005, the IRD was ready to proceed.  Ms Spencer again sought an adjournment of the hearing and this was granted.  Mr Abraham was remanded to a further status hearing on 19 July 2005.   At the status hearing on 19 July 2005, Mr Abraham was remanded by consent to appear on 16 August 2005.  On 16 August

2005, the charges were again set down for a two day defended hearing commencing

15 December 2005.

[18]     On 13 December 2005, the Court advised that there were no Judges available for the hearing on 15 December 2005 and Mr Abraham was further remanded by the Court to a two day defended hearing on 1 and 2 May 2006.

[19]     On 1 May 2006, Mr Abraham entered guilty pleas to the charges through his counsel Ms Spencer.   Mr Abraham was remanded for sentencing on 4 July 2006. Mr Abraham was not advised by the Court at this hearing or at any earlier hearings, of his right to elect trial by jury in accordance with s 66(2) of the SP Act, nor was there an indication by his counsel to the Court of his election in accordance with s 66(7) of the SP Act.  The IRD was ready to proceed summarily.

[20]     On or about 15 June 2006, Mr Abraham instructed Ms Spencer in writing to advise the Court of a change of plea to one of not guilty to the charges.  Ms Spencer conveyed the same to the Court by way of a memorandum dated 21 June 2006, wherein she also sought leave to withdraw as counsel.   Mr Abraham sought alternative legal advice.  As a result, on 4 July 2006 the sentencing was adjourned by consent to 15 August 2006 for hearing of an intimated application for leave to withdraw the guilty pleas.

[21]     Mr Abraham filed an application dated 27 July 2006 for leave to vacate his guilty pleas to the charges under s 42 of the SP Act.   On 15 August 2006, the application was adjourned to enable counsel for the IRD to review court records to establish whether there was any verbal record of advice in Court of Mr Abraham’s right to elect trial by jury.  It was subsequently accepted that the IRD was unable to point to any evidence that s 66 of the SP Act had been complied with.

[22]     On 6 November 2006, Judge Gittos heard and dismissed the application for leave to vacate the guilty pleas (the s 42 application).  Mr Abraham was remanded for sentencing.  The sentencing was subsequently adjourned by consent to a date for mention on 22 May 2007 to allow this judicial review proceeding to be determined. As this date has now past, no doubt a new date for mention has been allocated.

Factual background

[23]     The above chronology from the agreed facts fairly records the procedural history of the charges from filing in April 2004 to the decision of Judge Gittos on the s 42 application for leave in November 2006.   What is also important for these judicial review proceedings is that a key ground of the s 42 application for leave to

withdraw the guilty pleas was that Mr Abraham had received incompetent legal advice from his counsel, Mr Clews and Ms Spencer, prior to the entry of the guilty pleas in May 2006.  As is usual when counsel incompetence is alleged, counsel for the IRD filed comprehensive affidavits from Mr Clews and Ms Spencer.   On the basis that the counsel incompetence argument was unlikely to succeed in the face of such evidence, the alleged breach of the provisions of s 66 of the SP Act took on a greater prominence.

[24]     The factual background to the offending may conveniently be drawn from the summary of facts.   The company was registered with the IRD for GST purposes from November 1995 with a two month filing frequency and a taxable activity of “transport operators”.

[25]     In March 2003, the IRD began an investigation into the GST affairs of the company after it was detected as one of a number of GST registered entities that had started filing nil GST returns after having previously filed GST returns that showed trading income.   The IRD’s investigation established that, between May 2000 and March 2003, the company filed 18 GST returns which recorded nil trading activity, whilst over the same period of time had filed income tax  returns that recorded trading income of $550,000 (for the year ended 31 March 2001) and $450,000 (for the year ended 31 March 2002).   Of the 18 “nil” GST returns filed, Mr Abraham personally signed nine of them.

[26]     The income tax returns of the company were prepared and filed with the IRD by its accountant.  Mr Abraham was responsible for the preparation and filing of the company’s GST returns.  After the investigation was commenced, Mr Abraham gave the accountant authority to act on his behalf in resolving the discrepancies that the IRD investigation had identified.   Subsequently, the accountant provided the IRD with a spreadsheet that calculated that each of the 18 GST returns that had been filed by the company between May 2000 and March 2003 should have been filed as debit returns.  The final amount of core tax that the IRD assessed for these 18 returns is

$81,431.68.

[27]     On 9 February 2004, Mr Abraham attended an evidential interview with the IRD at which he admitted that he was solely responsible for the day to day management of the company, that he was responsible for filing its GST returns and that he understood the GST system.  Mr Abraham explained that the company had filed the 18 nil GST returns because it had been experiencing financial difficulties. The charges were then laid in the District Court.  None of the outstanding GST has been paid to the IRD.

[28]     Mr Abraham sought advice from Mr Clews, one of New Zealand’s leading specialist tax counsel.   Mr Clews was assisted by Ms Spencer who also provided advice to Mr Abraham.  In the lead up to what was to be a defended hearing of the charges  in  the  District  Court  on  1  and  2  May  2006,  Mr Abraham  met  with Ms Spencer to discuss the charges.  As a result of this meeting, Ms Spencer prepared a  detailed  letter  of  advice  on  28  April  2006  (the  letter),  which  she  deposed “contained a full and frank assessment of the case … and the likelihood of a successful outcome, given that Mr Abraham had not advised me of a legal defence.”

[29]     The letter was on Mr Clews’ letterhead, but was signed by Ms Spencer in her capacity as “Barrister Associate”.   The letter was comprehensive and covered six pages, summarising Mr Abraham’s instructions and referring to the nature of the charges, including the point that they involve knowingly providing false GST returns intending to evade the assessment of GST over a three year period.  The elements of the charges were outlined including the required mens rea aspect.  There was also consideration of the evidence, the strength of the IRD’s evidence, the defence, and the likely outcome.  The letter concluded with a recommendation and advice.  At the foot of the final page, Mr Abraham signed beneath the following statement and crossed out the words “not guilty”:

I, Wiremu Pikitekaha Abraham have considered the advice contained in this letter and confirm that I wish to plead guilty not guilty to the above charges when the matter is called on 1 May 2006.

[30]     The letter must be seen in context of the overall advice given to Mr Abraham by Mr Clews, who noted in his affidavit that he was concerned that Mr Abraham’s affidavit  “over-emphasises  a  letter  written  by  Miss  Spencer  on  28 April  2006 without  taking  into  account  all  of  the  advice  that  Mr  Abraham  received  from

Miss Spencer and me”.  Mr Clews referred to an early meeting with Mr Abraham at which he discussed the ingredients of the charges including the element that the false filing should be with intent to evade.  Mr Abraham had insisted that the company had not intended to evade the GST that it had not paid, and which formed the basis of the offences with which he was charged.

[31]     Mr Clews then deposed at paragraph 9 of his affidavit that:

The essence of Mr Abraham’s position on the “intent to evade” was that he had filed false GST returns to buy some time for his company which was in dire financial straits because of a creditor having defaulted, and that he had always intended to get around to paying the GST to the IRD.  He therefore knew that GST was chargeable to the company and was not being properly returned.  I remember explaining to Mr Abraham the essence of intent in the context of evasion.   I also advised that the starting point for a Court in deciding whether or not he intended to evade tax would be what he actually did and how he went about it.  I remember saying to him that on this point actions often spoke louder than words.  Asserting a position was one thing, but providing something in evidence to allow a Court to conclude that there was reasonable doubt as to his intent was another.  I advised Mr Abraham that I was very concerned that he could not really offer anything, particularly in  terms  of  his  knowledge,  the  length  of  time  the  offending  and  his subsequent actions concerning the tax debt, to suggest that he had acted without intending to avoid the company’s GST liability, whether temporarily or absolutely.

[32]     He went on to say at paragraph 11:

I thought at the time that Mr Abraham understood this position and accepted it.   He seemed to understand that he could argue that he might not been motivated to evade tax but that legally that is what he might have done, given that he knew tax was due and had acted to avoid the company having to pay it. …

[33]     Mr Clews confirmed at paragraph 13-14 of his affidavit that the letter was written when Mr Abraham advised that:

…he had reconsidered the way he wanted to plead and that he wanted to plead not guilty and proceed to a defended hearing.   This was a very late development.   I advised Miss Spencer that she should record her advice formally.  I read her letter through before it was given to Mr Abraham.  Her letter does not deal in as many words with the “intent to evade”.  I expect that is because she had still not received any instructions from Mr Abraham that would have suggested the Crown would have to go beyond the bare facts of the case to establish the intent element of the offence.   Her letter does, however, refer to the elements of knowledge or recklessness that make up the element of intent according to the authorities that I have referred to at

paragraph 8 above, and which had formed the basis for my prior discussion with Mr Abraham.

Although it may have been better for the point to have been explicitly made in Miss Spencer’s letter, I have no doubt that Mr Abraham had understood the points I had earlier made to him about the intent issue and I understand that Miss Spencer took Mr Abraham through the letter very carefully on that point.  For the reasons that I have set out in the forgoing paragraphs I do not accept that Mr Abraham was not advised that the IRD would have to prove that his company had the intent to evade GST.  He was advised of this by me, of the legal meaning of intent in the context of tax evasion, and of what would be relied on to establish that intent in his case.   The necessary knowledge or recklessness for the intent element of the offence to be made out, absent any other facts, was then referred to in Miss Spencer’s letter.

[34] Finally, Mr Clews deposed that, whilst Mr Abraham had been reluctant to plead guilty, he said that he had talked things over with his wife and had decided to plead guilty to the charges. He then returned the letter signed by him as described at [29]. Mr Clews was somewhat “taken aback” at this, but commended Mr Abraham on a good decision. There was no suggestion on review that Mr Abraham had been subjected to any undue or improper pressure in his decision to enter guilty pleas.

The decision of the District Court

[35]     Judge Gittos referred to the principles that apply when a Court is considering whether to grant leave to withdraw a plea of guilty under s 42 of the SP Act.  He rightly noted at [11] that “such discretion is not to be lightly exercised and will only be exercised favourably to the applicant where the interests of justice so demand”. Judge Gittos also correctly identified at [15] a key issue for decision as relating to the procedure surrounding the entry of the guilty pleas.  The question was:

…whether what the present situation   now presents is a mere defect or irregularity such as might be cured by the application of s 204 of the Summary Proceedings Act, or whether it is something which goes further than that and is in fact something that renders the proceedings a nullity.  In other words is it an omission of substance or form.

[36]     The Judge had earlier referred to an unreported decision of John Hansen J in Stoves v Police HC CHCH CRI 2003-409-000067 28 October 2003.  That was a case where a defendant on a breath alcohol charge was not advised of his right of election, proceeded to a summary trial, was convicted and then appealed.   The High Court

held that the failure to afford the election of trial by jury was a fundamental failing and the appeal was allowed.  But the Judge distinguished that case, describing the present case as one:

…where a defended hearing was not in contemplation, where the defendant had taken advice, accepted that advice and entered pleas of guilty, then the formal announcement by his counsel that he elected summary jurisdiction or the formal putting of the election to him before pleas were taken, is in my view simply a matter of form and not a matter of substance.  It would be a matter of substance only if he were considering a defended hearing, which at the critical time he was not.

[37]     The Judge then went on to discuss the application for leave to withdraw the pleas  of  guilty by Mr  Abraham.    His  reasoning  is  conveniently summarised  at [18]-[20]:

[Mr Abraham] now says in an affidavit that he was never made aware of his right to trial by jury and had he been made so aware he would have exercised it and sought trial by jury, but that is really not consistent with what he did in fact do, which was to acknowledge his responsibility, his guilt if you like, for the offences and enter a plea of guilty having had full legal advice on the matter and plenty of time to think about it.

If, as I find it to be, the failure to record a formal election by the Court and to have one formally put in circumstances where a guilty plea is being entered is nothing more than a matter of form, then it is not a breach which in my view involves any miscarriage of justice in itself, nor can it be said to have led to a miscarriage of justice.  The availability of a jury trial really does not impact upon whether one acknowledges one’s guilt or not.  Having reached a decision to enter a plea of guilty, on proper advice, the defendant cannot really be heard then to say that he would not have done so if he had thought of proceeding in a different way with a defended hearing.

I am satisfied that the want of any formal reference to an election of trial by jury in the proceedings is not such as to justify this application to set aside the pleas of guilty, nor on the other material put before the Court is there any persuasive indication that the interests of justice require these pleas which have been entered in a considered way after proper advice was taken should be set aside.

Course of review hearing

[38]     Counsel for both Mr Abraham and the IRD filed comprehensive and wide ranging written submissions for the review hearing.   These were supplemented by the oral submissions.   At the hearing of the review, the point that emerged as the central issue was whether the convictions were a nullity on the basis that there was a

procedural irregularity (i.e. non-compliance with s 66(2) of the SP Act) at the time the guilty pleas had been entered.  Counsel were given leave to file additional written submissions after the hearing, particularly on the principles applicable to s 204 of the SP Act by which any non-compliance with s 66(2) should be measured.   Both counsel took advantage of this invitation.

Scope of judicial review

[39]     It  is  important  to  recall  that  this  proceeding  is  not  an  appeal.    It  is  an application for judicial review.   Hence, Mr Abraham is restricted in the matters which may be raised.  The traditional grounds for review are of course those three outlined by Lord Diplock in Council of Civil Service Unions v Minister for Civil Service [1985] AC 374 at 410: illegality, irrationality and procedural impropriety. Applications for review of decisions of inferior courts are amenable to judicial review on the same grounds as administrative authorities in New Zealand. In McMenamin v Attorney-General [1985] 2 NZLR 274 the Court of Appeal treated a material error of law by the District Court as reviewable in the same way that such an error would be reviewable if made by an administrative authority.

[40]     In  particular,  this  is  an  application  for  review  brought  under  s  4  of  the Judicature Amendment Act 1972, which allows for review of any exercise, refusal to exercise, or proposed or purported exercise by any person of a statutory power of decision.  It is common ground between the parties that the decision of Judge Gittos on  the  s  42  application  is  capable  of  review:    see  Sharp  v  District  Court  at Whangarei [1999] NZAR 221 (HC) and Leeder v Christchurch District Court [2005] NZAR 18 (HC). However, as Randerson J recognised in Sharp at 225, there is a difference in approach when there is a review from when there is an appeal:

It is axiomatic that this Court will not on judicial review intervene with the decision of a lower Court or Tribunal unless one or more of the recognised grounds for review is  made  out.    In  particular,  the  Court’s  function on judicial review is not an appeal on the merits and the reviewing Court will not merely substitute its own view of the matter for that of the District Court Judge or Tribunal.

[41]     Any analysis of an alleged breach in respect of s 42 of the SP Act involves a contextual inquiry, requiring assessment by reference to the particular  facts and circumstances of the individual case.  While the discretion conferred by s 42 falls to be exercised on the same principles (as outlined from [46]) in each case by the District Court, its application will necessarily be affected by the context and the particular circumstances of the applicant who wishes to vacate the guilty plea.  This approach also transfers to the process of judicial review:   in order to determine whether any of the grounds of review exist, the particular circumstances surrounding the decision-making itself become important.

Relevant statutory provisions

[42]     Section 42 of the SP Act provides:

42     Plea of guilty may be withdrawn by leave of Court

A plea of guilty may, by leave of the Court, be withdrawn at any time before the defendant has been sentenced or otherwise dealt with.

[43]     Section 66 of the SP Act provides:

66      Defendant’s right to elect trial by jury where offence punishable by more than 3 months’ imprisonment

(1)     Any person charged under this Part of this Act with an offence which is  punishable  by imprisonment for  a  term exceeding  3  months  shall  be entitled, before the charge is gone into but not afterwards, to elect to be tried by a jury. Before the defendant is called upon to make his election under this subsection, the substance of the charge shall be stated to him.

(1A)     If a Registrar receives and records an election under section 66A(1), the substance of the charge need not be stated to the defendant under subsection (1)

(2)      Except in any case in which subsection (7) of this section or section

66A(1) applies, the Court shall, before the charge is gone into in respect of an offence to which this section applies, inform the defendant of the right

conferred on him by subsection (1) of this section by causing him to be

addressed to the following effect:

“This case is one where you have a choice of being tried here in this Court or of being tried by a Judge and jury.  Do you wish to be tried by a jury or by this Court?”.

(3)     Where a corporation is charged with an offence in respect of which an individual would be entitled under this section to elect to be tried by a jury, an election to be so tried may be made on behalf of the corporation by its representative;   and,   where   the   corporation   does   not   appear   by   a representative or no such election is made on behalf of the corporation, the Court may, subject to the provisions of this section,  deal  with the case summarily as if the offence were an offence to which subsection (1) of this section did not apply.

(4)     Where a defendant who is charged under this Part of this Act with an indictable offence elects under this section to be tried by a jury, the proceedings shall continue as if he had been charged on an information in form 2 in the Schedule 2 to this Act.

(5)      Where a defendant who is charged with a summary offence elects under this section to be tried by a jury, the proceedings shall continue as if the offence were an indictable offence not punishable summarily, and, if he is committed for trial or for sentence, he may be dealt with accordingly.

(6)      A defendant who has elected under this section to be tried by a jury may, by leave of the Court at any time before he is committed for trial or for sentence, withdraw his election, and thereupon the Court may, notwithstanding anything in section 153A or section 168 of this Act, deal summarily with the case in all respects as if no such election had been made, and the foregoing provisions of this section shall no longer apply:

Provided that where the Court is presided over by 2 or more Justices or one or more Community Magistrates and the defendant has pleaded guilty to an offence which the Court does not have jurisdiction to deal with summarily by reason of its constitution, the Court shall record the plea and shall adjourn the proceedings for the defendant to be sentenced or otherwise dealt with by a Court presided over by a District Court Judge.

(6A)    Where a defendant who has elected under this section to be tried by a jury has pleaded guilty pursuant to the provisions of section 168 of this Act and he is not represented by a barrister or solicitor, the Court, unless it considers that leave should not be granted to the defendant to withdraw his election, shall draw to his attention the provisions of subsection (6) of this section.

(7)     Any barrister or solicitor who appears for the defendant may (whether or not the defendant is personally present) inform the Court on his behalf that the defendant does not elect to be tried by a jury, or may (where the defendant is personally present) inform the Court on his behalf that the defendant does elect to be so tried, and thereupon the Court may proceed as if the defendant had personally made the election:

Provided  that,  if  it  thinks  fit,  the  Court  may,  if  the  defendant  is  not personally present and his counsel or solicitor informs the Court that the defendant does not elect to be tried by a jury, adjourn the hearing to such time and on such conditions as the Court thinks fit to enable the defendant to be present or issue a warrant, in the prescribed form, to arrest him and bring him before the Court.

[44]     Section 204 of the SP Act provides:

204     Proceedings not to be questioned for want of form

No information, complaint, summons, conviction, sentence, order, bond, warrant, or other document, and no process or proceeding shall be quashed, set aside, or held invalid by any [District Court] or by any other Court by reason only of any defect, irregularity, omission, or want of form unless the Court is satisfied that there has been a miscarriage of justice.

[45]     For completeness, s 24(e) of the New Zealand Bill of Rights Act provides:

24    Rights of persons charged

Everyone who is charged with an offence—

…

(e)     Shall have the right, except in the case of an offence under military law tried before a military tribunal, to the benefit of a trial by jury when the penalty for the offence is or includes imprisonment for more than 3 months;

Principles governing applications to withdraw pleas

[46]     Pursuant to s 42 of the SP Act, the Court may grant leave to a defendant to withdraw guilty pleas provided the defendant has not been sentenced or otherwise dealt with.  There is no dispute in this case as to the applicable principles now briefly summarised.

[47]     The discretion to allow a change of plea is exercised on the broad basis of the interests of justice and in order to prevent a miscarriage of justice: see R v Ripia [1985] 1 NZLR 122 (CA). Such discretion is to be exercised sparingly: see Smith v Police HC HAM AP3/92 14 April 1992, Penlington J at 5 quoting Lord Upjohn in S (an infant) v Manchester City Recorder & Others [1971] 1 AC 481 at

507 (HL).

[48]     A review of the authorities confirms that leave to change a plea will most commonly arise where:

a)        The applicant has made a material mistake as to the nature of his plea or the nature of the charge:  see R v Ripia; or

b)The proceedings at the time of taking the plea were fundamentally defective,   rendering   the   taking   of   the   plea   a   nullity:      see R v Blackmore [1994] 1 NZLR 268 (CA); or

c)       There is a “clear defence” to the charge (see R v Le Comte [1952] NZLR 564 (CA); Smith v Police; R v Pira HC ROT S3/90 11 April

1990, Anderson J; or

d)The applicant has pleaded guilty for  reasons  unrelated  to  guilt  or innocence, for example, as a result of threats or duress: see R v Turrall [1968] NZLR 312 (SC) and R v H (1991) 7 CRNZ 110 (HC).

[49]     It  is  also  clear  from  the authorities  that  successful  applications  are  rare, particularly where  the  applicant  was  in  receipt  of  competent  legal  advice  from experienced counsel when the plea was entered.   Applicants are not permitted to reverse their pleas merely because they regret their decision, or because on further advice feel they might succeed upon trial by jury.

[50]     The  applicable  principles  were  considered  by  the  Court  of  Appeal  in R v Ripia.  The appellant pleaded guilty to rape but later sought to vacate his plea “because of a misunderstanding of the pros and cons in respect of which the applicants have reconsidered their positions…” (at 123).   The Court of Appeal dismissed his appeal against conviction, stating at 127-128:

The real issue in the present case is whether Ripia understood the nature of the charge against him and, in the face of that understanding, made his own decision, albeit with Mr Ryan’s advice, to plead guilty…

On the state of the evidence and the complainant’s demeanour Mr Ryan, a counsel of many years experience in the criminal Courts, took a pessimistic view of Ripia’s chances of acquittal and so advised him.  Some counsel may have advised Ripia to plead not guilty and take the verdict of the jury.  But such advice would need to have been accompanied by advice on the likely consequences for Ripia if the jury should return a verdict of guilty against him.  What is important is that Mr Ryan left the choice to Ripia.  Provided he did that, he was quite entitled, indeed obliged to put forward to Ripia the pros and cons of the case and impress upon him the consequences in terms of sentence if he were found guilty after entering a plea of not guilty…

…

In the end we are constrained to the view that Ripia, having received proper advice from Mr Ryan, was left to make up his own mind on his plea and that his application to be allowed to change it was made merely because he repented of it and because, on further advice, he thought he ought to have taken his chance with a jury.  This is not enough to support an application for change of plea – R v Le Comte [1952] NZLR 564.

(emphasis added)

[51]     The need for a sufficiently tenable evidential basis for the existence of the clear  defence  was  considered  by  the  Court  of  Appeal  in  R  v  Stretch  [1982]

1 NZLR 225. That case involved a plea of guilty to a murder charge, where subsequently the defendant submitted that he made a mistake in pleading guilty on the basis that he could have raised a defence which might have meant that the Crown case would not be able to prove his guilt beyond reasonable doubt.

[52]     The Court of Appeal dismissed the appeal against conviction bought by the defendant.  After analysing the advice the defendant had been given by his counsel, Cooke J said at 229-230:

There may be cases where a line of defence is sufficiently tenable to call or a fuller and more explicit explanation to the accused by counsel than seems to have occurred in the present case.   We do not say that a miscarriage of justice can never be established on such a ground.  But when the accused has the advice of experienced counsel, such cases will be rare.  We are satisfied that  the  present is  not  one  of  those  rare  cases.    In  deciding  whether  a miscarriage of justice has been shown the Court should, in our view, look at all  the  circumstances.     Here  these  include  the  accused’s  own  strong inclination to plead guilty and the unanimous opinion of his professional advisers that the murder charge was unlikely to be successfully defended. They also include the grounds on which that opinion was based.

[53]     The application of these principles is also illustrated in Faulkner v Crown Solicitor at Auckland HC AK T116/94 27 July 1995, Fisher J.  The application to allow a change of the pleas was considered by the High Court under its inherent jurisdiction.   The applicant had pleaded guilty on arraignment to various charges. Important evidence against the applicant consisted of intercepted recordings.   The applicant’s co-accused subsequently challenged the admissibility of the intercepted recordings and Fisher J ruled that evidence inadmissible.   After that ruling, the applicant obtained new counsel and sought to vacate his guilty pleas.

[54]     Fisher J rejected the application and in the course of doing so said at 3:

It seems to me, however, that the application should be determined on a more fundamental basis.  Underlying it all, the guilty pleas would not have been entered in this particular case but for the defendant’s knowledge that he was in truth guilty of all the crimes with which he was charged.  That was the ultimate foundation on which the pleas rested no-one has suggested that there  was  ever  any  mistake  about  it.    Court  hearings  are  not  a  game. Although there are certain procedural protections which on occasion take priority, the ultimate objective is normally to get at the truth.  No-one has argued before me today, certainly not Mr Faulkner in his affidavit or Mr Field in his argument, that Mr Faulkner not in fact guilty of these crimes. When an accused has admitted that he has committed crimes and pleads guilty accordingly and then comes back before this court seeking to take advantage of a technicality to avoid legal responsibility for them it could not be said that there would be any miscarriage if an application to change pleas of guilty is refused.  Evidence only a means to an end.  The end here is the truth.   Once the truth has been admitted, and there are no grounds for thinking that it was falsely admitted, the admissibility of the evidence which the prosecution might in other circumstances have had to rely upon is irrelevant.

(emphasis added)

[55]     Counsel for the IRD submitted that there are similarities between the present case and the situation in Faulkner, particularly if the Court accepts that there is no basis for  granting Mr  Abraham  leave  to  change his  pleas,  other  than  the  point relating to his right to elect trial by jury.  Counsel also placed weight on the fact that, as in Faulkner, by his pleas Mr Abraham was recognising that he was guilty of the charges brought against him.

Interpretation of s 204 of the SP Act

[56]     On review, the critical question for the Court is whether there was a material error of law in the decision of Judge Gittos that non-compliance with s 66 of the SP Act did not render the convictions defective and a nullity.   Essentially, this turns upon what went wrong in terms of want of procedure or non-compliance with the rights of the plaintiff, measured against the saving provision of s 204 of the SP Act.

[57]     It was common ground that there is no evidence that an election was offered to the plaintiff in accordance with s 66(2) of the SP Act or that there was an election made  in  terms  of  s  66(7).    As  noted  at  [4]  above,  it  was  also  accepted  that

Mr Abraham had not been advised by any of his counsel of his right to elect trial by jury.

[58]     The leading case on s 204 of the SP Act is the decision of the Court of Appeal in R v Kestle [1973] 2 NZLR 606 (CA). In that case, the accused argued that he had not been validly committed for trial as the requirements of s 168 of the SP Act had not been complied with. It was common ground that the statement set out in s 168(1)(a) of the SP Act, regarding the option to plead guilty, was not read to the accused. This was rectified at a later committal hearing but with the accused reserving his rights to challenge the original committal. The accused argued his original committal was a nullity. The Court of Appeal dismissed that argument saying at 609:

Another important point of distinction is that the earlier sections were not qualified in their operation by words such as now appear in s 204, namely, “unless the Court is satisfied that there has been a miscarriage of justice”. We see no reason why full effect should not be given to the ordinary and natural meaning of  the  language  of  s  204,  and  we  say  this  particularly because of the protection which the qualifying words to which we have just referred give to accused persons.

Submissions for the IRD

[59]     Counsel for the IRD argued on the basis of Kestle that the failure of the Auckland District Court to offer the plaintiff a right to elect is an omission different in type but not in character to the omission by the District Court in Kestle. Hence, any procedural error should be saved by s 204 of the SP Act.

[60]     Counsel for the IRD also submitted that an analysis of a breach under s 204 requires a two step inquiry, as set out in Mathieson v Allan [1979] 2 NZLR 200 (SC) at 203:

a)        Is the “defect, irregularity, omission or want of form” such that the proceedings are a nullity?  If not, there is a second question.

b)Has the “defect, irregularity, omission or want of form” caused  a miscarriage of justice?  If not, then the defect or irregularity (with the convictions in this case) can be cured by s 204.

[61]     Counsel for the IRD also gave a number of examples of cases in which the courts have  considered  s  204.    Failure to strictly comply with  the  terms  of  an infringement notice either nullifies the proceedings nor leads to a miscarriage of justice:  Police v Thomas [1977] 1 NZLR 109 (CA). Importantly, Cooke J (as he then was) discussed the application of s 204 at 121:

If a notice considered as a whole is defective, s 204 will apply unless there has been a miscarriage of justice.  No doubt s 204 is unavailable if a defect is so serious as to result in what should be stigmatised as a nullity.  But nullity or  otherwise  is  apt  to  be  a  question  of  degree:    compare  Broome  v Chenoworth (1946) 73 CLR 585, 601, per Dixon J; New Zealand Institute of Agricultural Science Inc v Ellesmere County [1976] 1 NZLR 630, 636, and authorities there cited. In practice the questions of miscarriage of justice and nullity will often tend to merge.

[62]     In Mathieson v Allan itself the question was whether the omission of the name, address and  occupation  of  the informant  from  the summons  form  was  a nullity.  The important fact in that case was that the appellants had turned up at the date and time in the summons represented.  They never suggested that the omission of information “occasioned inconvenience to them or handicapped them in the preparation of their defences” (at 202).  Even had that occurred, it could have been remedied by an adjournment and the requirement that further particulars be given, as well as the award of costs.   O’Regan J held that the defect did not render the summons a nullity, nor did it create a miscarriage of justice.

[63]     The question in Muirson v Collector of Customs [1982] 2 NZLR 506 (HC) was whether the failure of the information to disclose an offence was a nullity or was open to amendment under s 43 of the SP Act. Grieg J concluded that a failure to disclose an offence in an information is a nullity, and such a nullity could not be saved by either s 43 or s 204. However, he said at 511 that cases in which the information was a nullity would be rare, as generally defective informations could be cured by s 204.

[64]     Hall  v  Ministry  of  Transport  [1991] 2 NZLR 54 (CA) involved an infringement notice that did not contain the information that the informant’s right to dispose of the matter by paying a fee continued until the issue of a reminder notice and 28 days thereafter. Cooke P, giving the judgment of the Court, further discussed the concept of a nullity as a question of degree at 57, saying that:

No doubt if a document or proceeding is so gravely defective that it should be treated as completely non-existent, the section will not apply.  The Court is slow, however to reach such a drastic conclusion, even where there are substantial deficiencies….

[65]     The form used in that case was intelligible and complied with most of the requirements,  thereby meaning that  it  was  not  a  nullity.    The  ability to  rectify proceedings was in issue, rather than the existence of proceedings themselves.

[66]     It is to be observed that the above cases deal with a situation different in nature from the present:  they deal with defects in the written notices and aspects of summary criminal procedure.  The present case is analogous in that it deals with a failure to inform Mr Abraham, but is different in that it involves a complete failure to inform  of  a  right.     However,  neither  is  this  situation  entirely  analogous  to R v Blackmore [1994] 1 NZLR 268 (CA) also cited by counsel for the IRD.

[67]     Blackmore involved a guilty plea entered in the District Court by a defendant who was unrepresented at the time.  The defendant had had a brief interview with his solicitor beforehand, but had told the solicitor he was no longer required.   The solicitor was granted leave to withdraw.   On an appeal against conviction on the basis of lack of representation at the time of the guilty plea, the Court of Appeal held that the requirement for representation by counsel when pleading guilty to an indictable charge under s 153A was so fundamental a safeguard that non-compliance renders the guilty plea and any subsequent conviction a nullity.   At 272, Casey J (giving the judgment of the Court) said:

On general principle, we cannot accept the proposition that an unrepresented accused, who pleads guilty before the case against him is known at the preliminary hearing, should have his entitlement to a jury trial depend on whether a Judge thinks there has been a miscarriage of justice in the light of whatever evidence might be adduced on an application for leave to withdraw his plea.   In this situation, as in some other areas of procedure, a strict adherence  to the rules affords  the  surest  guarantee  of  justice.    To  hold

otherwise would be to negate the purpose and efficacy of s 153A.   The general principles which apply to an application to withdraw a plea of guilty would always allow relief where there has been a miscarriage of justice.

[68]     Counsel for the IRD next referred to s 24(e) of the New Zealand Bill of Rights Act 1990 which relevantly provides an accused with the right to the benefit of a trial by jury where the penalty for the offence is or includes imprisonment for more than three months.  However, counsel submitted that the issue in this case was not about the right itself, but rather the implications of a failure to meet the statutory requirement in s 66(2) of the SP Act to advise an accused that he or she has the right to elect.  The distinction was important, because the fundamental right (to elect trial by  jury)  is  mirrored  in  s  66(1)  of  the  SP  Act.    But  that  did  not  elevate  the requirement to advise an accused under s 66(2) to a fundamental right.  Accordingly, the point in issue is to be determined by the law on vacation of pleas and the application of s 204 of the SP Act.

[69]     Finally, counsel for the IRD referred to the position in England where, from

2003, there had been a “sea-change” in relation to similar types of procedural failure. Such change had arisen as a result of the House of Lords decision in R v Soneji [2006] 1 AC 340 (HL) which approved the English Court of Appeal decision in R v Sekhon [2003] 1 WLR 1655 (CA). The wide reaching effect of such decisions was demonstrated in R v Ashton [2007] 1 WLR 181 (CA). There, Fulford J, giving the judgment of the Court, stated at 4 that:

The outcome of each of these cases essentially depends on the proper application of the principle or principles to be derived from the decision of the House of Lords in R v Soneji [2005] 3 WLR 303; [2005] UKHL 49, together with the earlier decision of this court in R v Sekhon and others [2003] 1 WLR 1655; [2002] EWCA CRIM 2954. Indeed, these three applications demonstrate how far-reaching the effect of those authorities is likely to be whenever there is a breakdown in the procedures whereby a defendant’s case progresses through the courts (as opposed to the markedly different situation when a court acts without jurisdiction). In our judgment it is now wholly clear that whenever a court is confronted by failure to take a required step, properly or at all, before a power is exercised (“a procedural failure”), the court should first ask itself whether the intention of the legislature was that any act done following that procedural failure should be invalid. If the answer to that question is no, then the court should go on to consider the interests of justice generally, and most particularly whether there is a real possibility that either the prosecution or the defence may suffer prejudice on account of the procedural failure. If there is such a risk, the court must decide whether it is just to allow the proceedings to continue.

[70]     In this context, the Court considered the earlier case of R v Haye [2003] Crim LR 287 (CA) where the statutory mode of trial criminal procedure had not been correctly followed when the appellant entered a guilty plea.  Such procedural error had, without opposition from the Crown, been held on appeal to be a nullity.  But the Court of Appeal in Ashton observed at [69] as follows:

Although in the instant case the judge followed the procedure in paragraph 7, these authorities are clearly important as regards the approach to be adopted when there has been a material procedural failure.  However, that said, each of these cases predate the decisions of the House of Lords in Soneji and this court in Sekhon, and we are confident that if Haye was decided now the result would have been the other way.  We are keenly aware of the extent to which this constitutes a significant departure from the way in which these issues have been dealt with and decided in the past, but we have no doubt that a new test and a new approach are now to be applied.

Submissions for the plaintiff

[71]     For Mr Abraham, Mr Davey submitted that the Judge was wrong not to have characterised the procedural error in this case as a nullity.   He relied strongly on Blackmore  and  Stoves,  discussed  above.     Drawing  on  the  fundamental  right contained in s 24(e) of the New Zealand Bill of Rights Act and repeated in s 66(1) of the SP Act, Mr Davey submitted that the requirement in s 66(2) (the right to be informed of the right conferred by s 66(1)) is so fundamental that failure to comply with it renders the pleas of guilty a nullity.   In this case, the entry of the pleas of guilty were carried out through counsel and this brought into play the provisions of s 66(7) of the SP Act.

[72]     In his additional submissions, Mr Davey referred to the case of Baker v Police HC AK A191/00 24 November 2000, Williams J.  In that case, there was an appeal against a conviction of an indictably laid charge of aggravated robbery where the appellant had apparently admitted his guilt at a Family Group Conference.  There was no agreement at that conference whether his case was to be dealt with by the Youth Court or by the District Court.  As a result, the case went before the District Court for what was termed a half day “disputed fact evidence case” to determine the level of the appellant’s involvement in the offending.   The District Court Judge determined at that hearing that the appellant should be convicted and transferred to the District Court for sentencing.  Because a preliminary hearing was never held, the

appellant was never given his election between the right to trial by jury or to have his information heard in the Youth Court.

[73]     It was submitted that s 204 of the SP Act saved this error.   Williams J

discussed Blackmore and the effect of s 204, then held at [25] that:

In the view that this Court takes of the matter, if legal representation is regarded as so fundamental that its absence renders a guilty plea a nullity, still more must that be the case in relation an election for jury trial and the opportunity to plead.

[74]     As a result, the appeal was allowed and the conviction quashed.  Mr Davey relies on this case as a direct precedent.  However, it is distinguishable.  In Baker, it was the failure to give an opportunity to plead (as outlined in the quotation above) that was the real problem, rather than any failure to give an election.   Williams J specifically said at [13]:

…the charge was laid indictably and assumed that, as a result, Mr Baker had been given the right of election under the Summary Proceedings Act 1957 s 66 and had elected to be tried by the Youth Court and not by a jury.  It now appears that that assumption may have been in error but in any event it does not affect the outcome of today’s hearing.

[75]     Mr Davey also submitted that there should be no recourse to the English authorities relied on by the Crown, namely Haye and Ashton.  Mr Davey submitted that, up until 2003, strict compliance with procedural requirements was required. Any non-compliance resulted in the step or proceedings being declared a nullity.  In Haye, no consideration was given as to whether the appellant should be tried in the Crown Court or dealt with summarily, which was not in line with the procedure required under the relevant legislation.   The Court of Appeal considered that the proceedings were a nullity.

[76]     Mr Davey submitted that cases such as Ashton should have no application in New Zealand as the law on whether a procedural defect is a nullity is well settled in this jurisdiction.   Further, he submitted that the English process is significantly different, and that in any event, the factual situation in Haye may be distinguished. That is because in Haye the appellant was in fact arraigned twice, and thus was aware of the election, unlike in the present case.

[77]     In  his  additional  submissions  Mr  Davey also  referred  to  Ratu  v  Harlow [1960] NZLR 861 (SC) which dealt with the nature of the entitlement to elect trial by jury contained in s 66(1). Mr Davey cited a dictum from the judgment of Haslam J which referred at 863 to the words “shall be entitled” as suggesting “a proprietary interest or the enjoyment of a privilege of more than an evanescent character”. But such discussion arose in the context of a case where a guilty plea had in fact been vacated in the Magistrate’s Court and the issue was whether, upon such vacation, the defendant still had a right to elect, notwithstanding an earlier election of summary jurisdiction.

Discussion

[78]     Having carefully considered the range of cases cited by counsel dealing with the application of the provisions of s 204 of the SP Act, several principles emerge:

a)       Whether a defect, irregularity, omission or want of form is a nullity is a question of degree;

b)If an accused person is advised by counsel and is able to exercise his or her rights despite the defect, irregularity, omission or want of form then s 204 will apply and there will be no nullity or miscarriage of justice; and

c)       Some rights are, by their nature, so fundamental that to fail to give effect to them through the criminal procedure set out in the SP Act will mean that there are no proceedings to which s 204 could apply.

[79]     What  also  becomes  clear  on  an  examination  of  the  case  law  is  that  the question of whether the proceedings are a nullity or whether s 204 applies is considered on a case by case basis taking into account the particular circumstances of each case.

[80]     Whether or not the right to elect trial by jury is a fundamental right cannot be considered  in  isolation.    Such  right  is  part  and  parcel  of  the  procedure  that  is

followed in criminal cases.  The statutory provisions governing criminal procedure must affect that right as must the factual context in which the right is to be given or considered.   This is because the right alone cannot be upheld and is essentially meaningless without the criminal procedure statutes that give it effect and the particular steps in the process as applied in any given situation.  A basic example of this interface is the consideration of when the right to be told of the election operates. It exists prior to the entry of the plea, but does not come into play until an accused person has entered a plea of guilty or not guilty to a charge.  This demonstrates that the right is informed by the criminal procedure being followed and the particular circumstances of each case, as they do not  all  follow  an  exactly identical  path through the criminal process.

[81]      It is possible to imagine a myriad of circumstances affecting an appellant in which the right to be informed of the right to elect trial by jury impacts in differing ways upon their case.   This is apparent from the different situation in which this issue was encountered in Stoves.   Even on the present facts, one can imagine that even with the slightest alteration of the facts the right might become more or less essential to the plaintiff.  For example, if the plaintiff was not represented by counsel at the time that he entered the not guilty plea, the fact of not having been told of the right  by the  Courts  would  assume  more  importance.    Conversely,  if  there  was affirmative evidence that the plaintiff had been told of the right to elect by counsel, the right to be told of it by the Court would decrease in importance.

[82]     Accordingly, I propose to apply the two stage process endorsed by O’Regan J

in Mathieson v Allan as discussed at [60] above.

[83]     Such a test is not dissimilar to the new approach to procedural irregularity in criminal cases mandated by the House of Lords in Soneji and applied by the Court of Appeal in Ashton.

Are the convictions a nullity?

[84]     As counsel for the IRD submitted, the critical issue in this case is not the right under s 66(1) to elect trial by jury, but rather the requirement to be informed of

such right in s 66(2).   Whether the failure to meet such requirement renders the relevant part of the criminal proceedings (i.e. the convictions following the guilty pleas) a nullity must depend in my view on all the circumstances of the case.

[85]     Counsel for the parties are agreed that, despite their exhaustive research, there appear to be no New Zealand cases directly on point.  If one is searching for a case with the closest factual similarity, that is to be found in the English case of Haye.  Whilst the appeal was allowed on the basis of a failure to comply with mode of trial procedure, a later Court of Appeal (see Ashton) has expressed confidence that, after the change in approach following the House of Lords decision in Soneji, the result would have been the other way.

[86]     It is also pertinent to recall the observations of Cooke P in Hall v Ministry of Transport where he emphasised the reluctance of the Courts to reach a conclusion that a defect in proceedings amounts to a nullity. He stated at 57 that: “The Court is slow, however, to reach such a drastic conclusion, even where there are substantial deficiencies…”. At 58, he stated: “But we repeat that such a conclusion is not reached at all readily; as was emphasised in Best v Walker [[1974] 2 NZLR 418] it is not a mechanical or technical question.”

[87]     In terms of relevant contextual background, I consider it was material that Mr Abraham was advised by one of the country’s leading tax counsel, had been provided with detailed and comprehensive advice on the charges and had instructed his counsel to enter pleas of guilty after written legal advice and by way of formal written instructions endorsed thereon.  I have also had regard to the fact that the issue was one where a defended hearing of the charges was not contemplated and involved non-compliance with a procedural step contained in s 66(2).   Like the Judge, I consider that what was involved here was more in the nature of an omission or a matter of form and not such as should be characterised as a nullity.

[88]     Turning then to the application of the second limb of the test, has the defect, irregularity,  omission  or  want  of  form  caused  a  miscarriage  of  justice?    When dealing with this question, it is also relevant that Mr Abraham was fully advised, as described above, prior to the entry of the pleas of guilty.   By his formal written

instructions to counsel Mr Abraham was acknowledging that he was guilty of the charges brought against him by the IRD. This also recognised the reality of the advice which he had been given by Mr Clews that he did not have a defence to the charges: see paragraph 9 of Mr Clews’ affidavit quoted at [31] above.

[89] In terms of whether there was any miscarriage of justice flowing from the omission to comply with s 66(2) of the SP Act, it is critical to recognise that Mr Abraham’s rights were protected by the provisions of s 42 of the SP Act. He could, and in this case did, seek leave of the District Court to withdraw the guilty pleas. However, as is clear from the principles governing applications to withdraw guilty pleas discussed at [46]-[55] above, the Court has a broad discretion to allow a change of plea on the basis of the interests of justice and in order to prevent a miscarriage of justice. In this area, the test under s 204 of the SP Act and s 42 relating to a change of plea coalesce. But what is required before leave will be granted is to establish one of the grounds on which the guilty plea may be withdrawn. The only other ground available is the possibility of existence of a clear defence.

Is there a clear defence?

[90]     Turning to the application of the principles relevant to s 42 of the SP Act, Judge Gittos concluded at [6] that:

It is evident that Mr Abraham came to his decision to enter pleas of guilty after lengthy legal advice taken over a long period and indeed he signed written instruction to counsel that guilty pleas were to be entered, which was endorsed upon a letter running to some 9 pages in which his situation was comprehensively  analysed.     Looked  at  objectively  the  advice  that  he received cannot be said to have been wrong or misleading in any way.   It was advice from a very reputable, if I may put it that way, a very well- established practitioner in the field of taxation law.

[91]     I agree.   Mr Clews and Ms Spencer plainly considered all elements of the charges.  The advice that there was no defence is unequivocal and clear cut.  In his affidavit, Mr Clews relevantly stated:

I advised Mr Abraham that I was very concerned that he could not really offer anything, particularly in terms of his knowledge, the length of time of

the offending and his subsequent actions concerning the tax debt, to suggest that he had acted strike out intending to avoid the company’s GST liability, whether temporarily or absolutely.

...

I think that Mr Abraham has reverted to arguing that he was not motivated by a desire to escape tax.  However, as he was advised, that is not enough to raise a reasonable doubt as to intent when it is axiomatic in Mr Abraham’s position that he knew at all times that GST was due from his company and his actions were calculated to allow the company to avoid having to pay that GST, even temporarily, because of its financial position.

[92]     On review, there was no real attempt by counsel for Mr Abraham to respond to these statements.  Indeed, there was no evidential basis upon which counsel could make such a submission.  I am therefore left in a position of having no alternative but to agree with the finding of the Judge that Mr Abraham had no defence to the charges.

Interests of justice

[93]     The issue of the interests of justice was considered by the Judge.  At [20], he concluded on this point as follows:

I am satisfied that the want of any formal reference to an election of trial by jury in the proceedings is not such as to justify this application to set aside the pleas of guilty, nor on the other material put before the Court is there any persuasive indication that the interests of justice require these pleas which have been entered in a considered way after proper advice was taken should be set aside.

[94]     Despite the careful and thorough submissions presented by Mr Davey, no new material was advanced on the judicial review to show that the Judge erred in this conclusion in such a way as to warrant intervention on any of the traditional grounds of review.

Miscarriage of justice

[95]     Again,  the  question  whether  there  was  a  miscarriage  of  justice  was considered by the Judge.  At [19], he stated as follows:

If, as I find it to be, the failure to record a formal election by the Court and to have one formally put in circumstances where a guilty plea is being entered is nothing more than a matter of form, then it is not a breach which in my view involves any miscarriage of justice in itself, nor can it be said to have led to a miscarriage of justice.  The availability of a jury trial really does not impact upon whether one acknowledges one’s guilt or not.  Having reached a decision to enter a plea of guilty, on proper advice, the defendant cannot really be heard then to say that he would not have done so if he had thought of proceeding in a different way with a defended hearing.

[96]     I too do not consider that the failure to record the formal election in the circumstances of this case involved a miscarriage of justice.   If Mr Abraham had been able to meet the established test under s 42 of the SP Act for obtaining leave to change his pleas, any procedural irregularity would have been rendered irrelevant. The reason he could not obtain leave was because inter alia there was no clear defence and no other factors or circumstances which caused a miscarriage of justice.

[97]     In the context of the test under s 204 of the SP Act, the same considerations apply.  I conclude that the plaintiff has not demonstrated that the omission or want of form has caused a miscarriage of justice.

Result

[98]     For the reasons set out above, it follows that the application for judicial review of the refusal to grant leave to Mr Abraham to withdraw his guilty pleas must be dismissed.   The case should now be remitted to the District Court so that the

sentencing of Mr Abraham can proceed.

Stevens J