Cai v R - [2011] NZCA 604

IN THE COURT OF APPEAL OF NEW ZEALAND

CA178/2011
[2011] NZCA 604

BETWEEN LISHAN CAI
Appellant

AND THE QUEEN
Respondent

Hearing: 2 November 2011

Court: Harrison, Miller and Asher JJ

Counsel: J Soondram for Appellant
M J Lillico for Respondent

Judgment: 1 December 2011 at 11.30 am

JUDGMENT OF THE COURT

A The appeal is dismissed.

BWe direct that the appellant is to attend the home detention address, 504/47 Wakefield Road, Auckland City, at 2.00 pm on 2 December 2011 and there await the arrival of the probation officer and representative of the alarm monitoring firm.

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REASONS OF THE COURT

(Given by Miller J)

Introduction

Lishan Cai appeals her conviction for accessing a computer system and thereby dishonestly and without claim of right causing loss to any other person.[1] The sole question on appeal is whether loss was caused.

The facts

[1]Crimes Act 1961, s 249(1)(b).

The computer system in question was that of Westpac Banking Corporation. On 27 August 2009 an employee of the bank, Anthony Simmons, accessed a customer profile for Clive Bish. Mr Bish was authorised to operate an account for Featherston Investments Ltd. When Mr Simmons accessed Mr Bish’s profile he was able to obtain information about that account together with confidential information which might be used to authorise a change of password.
On 31 August 2009 a Mr Chan, who had arrived in New Zealand from China two days earlier, opened an account at Westpac in his own name. Mr Chan knew Ms Cai, and she, a former Westpac employee, was a friend of Mr Simmons.
On 1 September 2009 an unknown male rang Westpac from a public payphone and changed Mr Bish’s password using information from his profile. Several hours later, an internet device located at a café was used to transfer $80,000 from the Featherston Investments account into Mr Chan’s Westpac account as a “one-time bill payment”. Mr Bish did not authorise this transaction. Ms Cai was in the café about the time of the transfer.
Westpac monitors online password changes and funds transfers, and it thought this transfer sufficiently suspicious to block Mr Chan’s account so he could not withdraw money from it. When he tried to do so on 2 September 2009 the automatic teller machine confiscated his card. He immediately left the country for Hong Kong.
On 2 September the transfer from the Featherston Investments account to Mr Chan’s account was reversed.

The conviction

Ms Cai was charged as a party to an offence under s 249(1)(b) of the Crimes Act 1961, which provides:
249 Accessing computer system for dishonest purpose
(1)Every one is liable to imprisonment for a term not exceeding 7 years who, directly or indirectly, accesses any computer system and thereby, dishonestly or by deception, and without claim of right,—
(a)obtains any property, privilege, service, pecuniary advantage, benefit, or valuable consideration; or
(b) causes loss to any other person.
...
Ms Cai was convicted at trial, the jury having been instructed by Judge Mathers that the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Cai v R

Details

AGLC: Cai v R [2011] NZCA 604
Case: [2011] NZCA 604
Decision Date: 1 December 2011

CaseChat Overview and Summary

Lishan Cai appealed her conviction for accessing a computer system and causing loss to another person by doing so dishonestly and without claim of right. The sole question on appeal was whether loss was caused. The Court of Appeal found that the transfer of $80,000 from Featherston Investments Ltd’s account to an account held by Mr Chan constituted a loss to Featherston Investments. This was so despite Westpac Bank reversing the transfer before Mr Chan could withdraw the funds. The Court held that loss need not involve something tangible, and funds standing to a person’s credit in a bank account are a chose in action, a form of property which can be extinguished by a transfer from the account. The appeal was dismissed and Ms Cai was directed to commence her sentence of home detention.

The Court of Appeal considered the meaning of the word “loss” in s 249(1)(b) of the Crimes Act 1961. The Court observed that the offence was drafted in a similar way to other offences in Part 10 of the Act, notably s 240 (obtaining something, or causing loss, by deception). The Court referred to R v Morley, which held that loss flowing from a deception is assessed as being “the extent to which the complainant’s position prior to the deception has been diminished or impaired.” The Court concluded that the debiting of Featherston Investments’ account by the transfer to Mr Chan’s account was a loss at all, it could scarcely be more direct. The Court rejected the argument that the loss was eliminated by the reversal of the transfer, stating that such an approach would impose an obligation on the Crown to prove that loss continued, ultimately until trial, and to admit the possibility of arguments that loss has not been proved because civil remedies against other parties have still to be exhausted.

The Court of Appeal found that the transfer of $80,000 from Featherston Investments Ltd’s account to an account held by Mr Chan constituted a loss to Featherston Investments. This was so despite Westpac Bank reversing the transfer before Mr Chan could withdraw the funds. The Court held that loss need not involve something tangible, and funds standing to a person’s credit in a bank account are a chose in action, a form of property which can be extinguished by a transfer from the account. The Court concluded that the debiting of Featherston Investments’ account by the transfer to Mr Chan’s account was a loss at all, it could scarcely be more direct. The Court rejected the argument that the loss was eliminated by the reversal of the transfer, stating that such an approach would impose an obligation on the Crown to prove that loss continued, ultimately until trial, and to admit the possibility of arguments that loss has not been proved because civil remedies against other parties have still to be exhausted.

The appeal was dismissed. Ms Cai was bailed pending appeal, suspending her sentence of home detention. The community work sentence was suspended by operation of law but will resume on delivery of this judgment. Ms Cai must now complete her sentence. The Court directed that the appellant is to attend the home detention address, 504/47 Wakefield Road, Auckland City, at 2.00 pm on 2 December 2011 and there await the arrival of the probation officer and representative of the alarm monitoring firm.

Orders