Canterbury Taxis Limited v New Zealand Transport Agency HC Christchurch CRI 2010-409-6

[2010] NZHC 569

IN THE HIGH COURT OF NEW ZEALAND CHRISTCHURCH REGISTRY

CRI-2010-409-000006

IN THE MATTER OF     an Appeal  s116 Summary Proceedings Act

1957

BETWEEN  CANTERBURY TAXIS LIMITED Appellant

ANDNEW ZEALAND TRANSPORT AGENCY

Respondent

Hearing:         24 February 2010

Counsel:Appellant (David Young In Person) M Zintl for Respondent

Judgment:      4 May 2010

JUDGMENT OF PANCKHURST J

Introduction

[1]      Following separate hearings on different days and before different Justices of the Peace the appellant company was convicted in relation to one summary offence and five infringement offences arising in relation to its activities as an approved taxi organisation.   Mr Young is the sole director of the company and, effectively, its owner through his control of a related company which owns the shares in Canterbury Taxis Limited.  He represented the company both in the District Court and in this Court.

[2]      The first infringement offences relate to a failure to operate a 24 hour service on 24 February 2009 and a failure to maintain a register of licence holders (drivers), being an infringement which arose when an inspection of the company’s records was

conducted eight days later.

CANTERBURY TAXIS LIMITED V NEW ZEALAND TRANSPORT AGENCY HC CHCH CRI-2010-409-

000006  4 May 2010

[3]      The information and the other three infringement offences relate to 25 June

2009 when a general inspection of the company’s records was intended to be undertaken.   Findings were entered that there was a refusal to produce relevant records, a failure to facilitate an inspection and failures to make certain records available when requested.

[4]      By and large Mr Young did not contest the factual matters which gave rise to the various allegations against the company.  The defence as raised in both courts involved a range of arguments based on the New Zealand Bill of Rights Act 1990, the Evidence Act 2006 and related matters.  The convenient course is to consider the two infringement offences which comprised one case in the District Court, and then the charge and three infringements which were the subject of the second hearing.

A failure to provide a 24 hour service?

The relevant rules

[5]      The appellant company is an approved taxi organisation.  Accordingly it is bound by r8.5(1) of the  Land Transport  (Operator  Licensing) Rule 2007 which relevantly provides:

An approved taxi organisation must:

(b) ensure that the services of its members who operate taxis are available to the public:

(i) 24  hours a  day and  seven  days  a  week,  through  a telecommunications system approved by the Director [of Land Transport].

Pursuant to s40 of the Land Transport Act 1998 and regulations under that Act, a contravention of this rule is an offence punishable by a fine of up to $2,000 if the defendant is a body corporate proceeded against by an infringement notice (as here).

The evidence

[6]      Geoffrey Scoringe, an enforcement officer with the New Zealand Transport

Agency,  gave  the  main  evidence  in  support  of  the  infringement  notice.    On

24 February  2009  he  made  two  telephone  calls  from  Christchurch  Hospital  to Canterbury Taxis and spoke to Mr Young.  At 3.30 am Mr Scoringe ordered a taxi to take him the short distance to Cranmer Square.  Mr Young responded to the effect that he had only one driver on duty.  He suggested Mr Scoringe contact “one of the bigger fleets”, however Mr Scoringe said he was happy to wait.

[7]      About  40  minutes  later  the  witness  again  phoned  Canterbury  Taxis. Mr Young responded to the effect that he had sent three texts to three different drivers but, seemingly, none of the drivers were interested in taking the job.

[8]      On 25 February Mr Scoringe again phoned Canterbury Taxis and spoke to Mr Young.  He identified himself as the person who made the calls in the early hours of the previous day.  Mr Scoringe asked Mr Young how many taxis were on duty at the relevant time.  There was no direct answer, although Mr Young said he had sent out three texts.  He also added “I couldn’t get anyone that wanted the job, which is no different from any other company”.

[9] In cross-examination Mr Scoringe was challenged on the basis that his order for a taxi was fictitious in nature. In addition, at the hearing before the Justices (which occurred over two days, 19 August and 23 December 2009) Mr Young submitted that Mr Scoringe acted as an undercover constable in breach of s13A of the Evidence Act 2008. The Justices rejected these arguments and found the infringement established.

Arguments on appeal

[10]     Numerous arguments were advanced by Mr Young, albeit in a global fashion rather than with particular reference to any one infringement notice.  These included assertions that the Justices were not impartial, “had little comprehension of the laws they  were  administering”,  counsel  was  grossly  incompetent  and  that  the  New Zealand Bill of Rights Act 1990 was breached.

[11]     I am in no doubt that the evidence in support of the information was ample and that the Justices’ finding was warranted.

[12] The argument directed to s13A of the former Evidence Act (now, effectively, s108 of the Evidence Act 2006) was misconceived. These provisions apply to prosecutions on indictment and relate to undercover police officers and, in particular, whether they may give evidence without disclosure of their identity. Mr Scoringe did not seek anonymity in giving evidence. Section 13A (or s108) are of no present relevance.

[13]     Nor is there anything illegitimate, or “fictitious”, in an enforcement officer ordering a taxi in order to test whether regulatory requirements are being complied with.  In this instance he established that they were not.

[14]     I shall return to the penalty imposed after  I have considered the second infringement determined in the course of this hearing.

A failure to maintain a register of licence holders?

[15]     The second infringement notice charged the company with failing to maintain a register of licence holders (taxi drivers) who were members of the organisation and of their passenger service licence numbers.

The relevant provisions

[16]     Rule 8.5(1) of the Land Transport (Operator Licensing) Rule 2007 relevantly provides  that  in  addition  to  maintaining  a  24  hour/7  day service  approved  taxi organisations must:

(e)       maintain a register of:

(i)  licence holders who are members of the organisation and their passenger service licence numbers; and

(ii)  drivers who are members of the organisation or are employed by members of the organisation or by the organisation itself, their driver

licence numbers, and the area knowledge certificate or certificates they hold; and

(iii)   the unique fleet number assigned by the organisation to each vehicle, and the registration plate details of that vehicle; and

(iv)  the number of vehicles operated by each member;

(p)   make the register required by 8.5(1)(e) available at reasonable times during normal business hours for inspection on demand by an enforcement officer.

[17]     A notice of inspection was shown to Mr Young on 4 March 2009, the day the inspection was undertaken.  The notice was issued pursuant to ss198 and 113A of the Act, which materially provide:

Section 198 – Inspections and audits

(1)    The  Agency  may  in  writing  require  any  person  who  holds  a  land transport document that authorises the provision of a service in the land transport system to undergo such inspections and audits as the Agency reasonably considers necessary in the interests of land transport safety (including inspections and audits of vehicles operated by such persons).

(2)  The Agency may carry out such inspections and audits as the Director reasonably considers necessary in the interests of land transport safety.

(3)  For the purposes of any inspection or audit carried out in respect of any person under this section, the Agency may in writing require that person to provide such information as the Agency reasonably considers relevant to the inspection or audit.

(4)   A  person to whom a  requirement is  made  under this  section must comply with that requirement.

Section 113A – Power to inspect records

(1)  For the purpose of ascertaining whether this Act has been or is being complied with by any person to whom this Act applies, any enforcement officer in uniform or in possession of a warrant or other evidence of his or her authority as an enforcement officer may require that person to produce without delay for inspection all relevant books or records in that person’s possession or over which that person has control, including (but not limited to) logbooks, records associated with logbooks, financial records relating to expenditure on fuel, invoices, vehicle maintenance records, depreciation records for vehicles, time and wage records, and waybills.

(2)  The enforcement officer may take extracts from or make copies of any books or records so produced.

[18]     Resulting from what was found (or not found) upon inspection of the register of licence holders a further infringement notice resulted.

[19]     Again, Mr Young raised multiple grounds of appeal, which, in the main, were advanced by way of assertion rather than reasoned argument.  He submitted that the inspection was an unreasonable search in terms of s21 of the New Zealand Bill of Rights Act 1990, because absent a complaint from a member of the public it was unreasonable to conduct the search in the first place.  There were further complaints that the enforcement officer who conducted the inspection, Peter Stevenson, did not warn Mr Young of his right to remain silent and that he was permitted to be present during the hearing in the District Court while four prior prosecution witnesses gave evidence, despite objection being taken to this turn of events.   The accuracy and reliability of Mr Stevenson’s inspection of the records was also challenged; while the evidence of a Mr Liu was criticised as both unreliable and dishonest.   There may well have been other complaints as well.

[20]     The unreasonable search argument is without merit.  There is no necessity for a complaint from the public before an inspection of this nature may be conducted. To the contrary, r8.5(1)(p) contemplates an inspection by an enforcement officer at any reasonable time during normal business hours.   That rule in itself provided authority for the inspection, albeit reliance was also placed on ss198 and 113A.

[21]     Although Mr Zintl argued that a search was different to an inspection and that, therefore, s21 of the Bill of Rights Act did not apply, I do not accept this.  No relevant  authority  was  cited.    An  inspection  of  business  records  belonging  to someone else comprises a search as that word is commonly understood.  But for a search to be unreasonable it must generally be shown that the search was conducted without authority, or in an improper manner.   There can be no suggestion of the former here.  Despite the breadth of his criticisms, Mr Young did not argue that the manner in which this search/inspection was conducted was unreasonable.

The evidence pertaining to the register of licence holders, drivers and vehicles

[22]     Putting  aside  for  the  moment  the  chronicle  of  complaints  advanced  by

Mr Young, there is I think an overarching issue concerning the manner in which the

evidence was adduced in this case.  Mr Stevenson inspected the company’s business records, in particular its register of licence holders, drivers and vehicles.  Because Mr Young  would  not  cooperate  in  allowing  the  records  to  be  photocopied, Mr Stevenson  copied  relevant  extracts  from  the  records  into  a  notebook.    For convenience, these notes were reduced to a spreadsheet by another investigator, Maurice Smith, who gave evidence and produced the spreadsheet in the District Court.  It identified the respects in which it was alleged the company’s register was deficient.

[23]     This mode of adducing evidence of what was contained in the records was unusual.  Ordinarily, in order to establish that a business record was inaccurate or otherwise deficient, the record (or a copy of it) would be produced as an exhibit, and evidence would then be directed to establishing the alleged inadequacies in relation to the register.  But Mr Stevenson could not produce the records themselves, or even a copy of them, because of the absence of cooperation and in the absence of any power to seize documents for use as exhibits.

[24]     Instead, the witness had little choice but to copy extracts from the records and then, as I have explained, Mr Smith produced the spreadsheet which became a court exhibit.   As a matter of first impression this method might be thought to have resulted in the production of hearsay statements.  Section 4 of the Evidence Act 2006 provides that a hearsay statement is one made by a person other than a witness which is adduced to prove the truth of its contents.  While the statements in these business records were made by someone who was not a witness in the District Court (presumably Mr Young), I do not consider that the purpose of adducing evidence of the statements was to “prove the truth of [their] contents”.  Rather, evidence as to the content of the statements in the register was adduced merely to establish what was there – what was said – but not its truthfulness.

[25]     However, there was in my view a hearsay problem with reference to proof that the records were deficient.  As to this Mr Stevenson gave this evidence:

65.   Out of the 34 member files I was provided with, at least six members were no longer members of the organisation; three members had changed addresses; one member had changed his taxi vehicle and another member was not operating pursuant to the passenger service licence listed for him.

[26]     Mr Stevenson gave evidence that he had spoken to various of the drivers, or former drivers, in order to establish to his satisfaction that what appeared in the register was inaccurate (typically out of date).  But, with two exceptions, the drivers who supplied the information to Mr Stevenson were not called as witnesses.  What these drivers told him was hearsay, and none of the procedures in the Evidence Act which enable hearsay evidence to be adduced were employed.

[27]     In the result, the Agency’s case was deficient to some extent.   But in two respects there was proof of the inaccuracies in the register.  On 4 March 2009, while he conducted the inspection, Mr Stevenson spoke to Mr Young.   In relation to a number of drivers who still featured in the register Mr Young made admissions to the effect that they were no longer with Canterbury Taxis Limited.

[28]     In addition, two witnesses were called to give evidence designed to establish inaccuracy.   Mr Hakim Abbou gave evidence which established that he ceased to drive for the company in January 2009, yet some two months later he still appeared in the register.  Mr Honglin Liu gave similar evidence; that he ceased to work for Canterbury Taxis Limited in March 2009 and also evidence which established that his address and registered taxi number as recorded in the register were not up to date either.

[29]     While I am satisfied that a failure to maintain the register was established on the basis of the evidence adduced in the District Court, the Agency did not fully establish its case because of the  reliance upon  hearsay evidence, in part.   This conclusion is relevant to penalty.

The sentence appeal

[30]     It remains to consider the sentence appeal.  The company was fined $1,000 and ordered to pay court costs of $130 in relation to the first infringement.  Given the maximum available penalty (a fine of $2,000) it cannot be said this fine was beyond the available range.  With reference to the second infringement, failure to maintain

the register, the company was fined $1,200, with court costs of $130.  In my view this fine must be considerably moderated for two reasons.  The first is the hearsay issue which I have just discussed.  The second is that the nature of the established failure arose from not removing from the register details pertaining to drivers who had left the organisation.  Of course this should have been done, but it was a failure born of untimely record keeping, rather than anything more sinister.   I allow the sentence appeal in relation to this infringement to the extent that the penalty is reduced to $400.

Refusal to produce records for inspection when required to do so

[31]     As noted in the introduction the company was charged with an offence of refusing  to  produce  records  for  inspection  contrary  to  s52(1)(c)  of  the  Land Transport Act 1998.   In addition, three infringement offences were also brought alleging breaches of rules which individually required the company to maintain a complaints  register,  a  register  of  licence  holders  and  to  facilitate  an  audit  or inspection without reasonable excuse.  The information and the three infringement offences all related to 25 June 2009, the date of the inspection and audit.

[32]     I think it is convenient to first outline the evidence, then refer to the statutory and regulatory provisions and, finally, to the arguments in support of the appeal.

The evidence

[33]     Mr Maurice Smith was the investigator in this instance.  On 23 June 2009 he delivered a notice of inspection and audit to the company at its business address,

163 Maces Road, Christchurch.  He handed the notice to Mr Young and advised him that  an  inspection  and audit  of  the  company would  be  conducted  at  10  am  on Thursday, 25 June 2009.

[34]     Mr Young responded to the effect that a search warrant must specify the reasons for the search.  Mr Smith replied that a search was not intended, rather an inspection and audit pursuant to the relevant regulatory regime.   Mr Young was unmoved.  He asserted that s21 of the New Zealand Bill of Rights Act required that

reasons be specified for a search, otherwise the search was unreasonable and unlawful.   At this point Mr Smith commented that while he did not accept this contention, the reason for the inspection and audit was the Agency’s belief that Canterbury Taxis  Limited was not complying with its obligations in relation to maintenance of required business records.

[35]     On 24 June Mr Young, on behalf of the company, delivered a letter to the Agency, to which was attached a copy of s21 of the Bill of Rights Act.  The letter included this:

...    As  raised  with  you  when  delivering  your  letter  every  search  you undertake must have a reason.  The only reason you provided was that you are suspicious of this company not complying with the law.  In response to that statement it was replied by [me] if you believe this company is not complying with the law then the writer wants to know about it.

On the grounds that you have no genuine reason for conducting the search anticipated on 25th June 2009, access will be denied.  ...

[36]     By a letter sent by email on 24 June Mr Smith outlined the reasons for the inspection and audit.  He indicated that the Agency “suspected non-compliance” by the company in relation to various of its obligations, and particulars were set out of concerns about whether certain records were being kept up to date and, more generally, “the apparent lack of control being exercised by Canterbury Taxis Limited”.   Hence, the letter concluded on the note that the Agency intended to continue with the inspection and audit at 10 am the following day.

[37]     In  the  late  afternoon  of  24  June  Mr  Smith  spoke  with  Mr  Young  by telephone.  The latter confirmed that access to the Maces Road premises would be denied.

[38]     Nonetheless the inspection and audit team went to Maces Road on 25 June shortly before 10 am.  Entry to the premises was sought by knocking on doors over a period of time.  There was no answer.  Mr Smith then telephoned Mr Young, but to no avail.

[39]     A further email to the company invited a reconsideration, in which event the inspection and audit would be conducted at 10 am on 26 June.  This invitation was not taken up.  In due course, the information and the infringement notices were laid.

The relevant rules/statutory provisions

[40]     The information laid against the company (CRN ending 2160) alleged  a refusal to produce relevant books or records for inspection, contrary to s52(1)(c) of the Land Transport Act.  This section materially provides that a person commits an offence if he/she (or it):

Fails or refuses to comply with any lawful requirement, direction, notice, request, or ... under this Act by an enforcement officer ...

The maximum penalty was a fine not exceeding $10,000: s52(2).

[41] The notice of inspection served on Canterbury Taxis on 23 June 2009 invoked ss113A and 198 of the Land Transport Act as the provisions which empowered the Agency to inspect and/or audit the records of the company. These are set out at [17].

[42]     The first infringement notice (ending CRN 970) alleged that the company had failed without reasonable excuse to comply with the s198 notice by which it was required to facilitate an audit or inspection of its transport service and being against s51(1) of the Act.   The maximum penalty for this infringement was a fine not exceeding $400: r4 Land Transport (Offences and Penalties) Regulations 1999.

[43]     The remaining two infringement offence notices (ending in the CRN numbers

971  and  972)  alleged  infractions  against  the  Land  Transport  Rule:  Operator Licensing, 2007; contraventions of which constitute an offence against s40 of the Land Transport Act, punishable by a fine of $2,000: r4 of the Regulations as in the previous paragraph.

[44]     More specifically, offence notice CRN 971 alleged a failure to make an approved taxi organisation’s complaint register available for inspection.  Rule 8.5(1) requires approved taxi organisations to:

(f)  maintain the register of complaints referred to in 3.5(2) and comply with the requirements in 3.5(3) to 3.5(7).

And r3.5 relevantly provides:

Complaints Register

3.5(3)    An approved taxi organisation must keep a single register of complaints containing the details in 3.5(2) for all its members and their drivers.

3.5(5)     The complaints register must be available for inspection at any reasonable time by an enforcement officer.

[45]     The final infringement offence notice alleged a failure to make available for inspection the register of licensees, drivers and vehicle details as required by r8.5(1)(e).  The relevant part of the rule appears at [16], including r8.5(1)(p), being the obligation to make the register available for inspection during normal business hours on demand being made by an enforcement officer.

The appellant’s arguments

[46]     Mr Young advanced a raft of arguments.  These included personal criticisms of the Justices who heard the case and of the prosecutor who acted for the Agency. In addition, the operative findings were attacked on the basis that the Justices were not impartial and that they predetermined matters, in that the decision itself and the sentencing occurred without the Justices retiring to discuss the case between themselves.

[47]     A similar argument was advanced in reliance upon s21 of the New Zealand Bill of Rights Act, namely that the intended search was unreasonable, because it was based on mere suspicion, was not prompted by a complaint from a member of the public and that there was no “genuine reason” for conducting a search.   Finally, Mr Young  submitted  that,  properly  analysed,  there  was  at  most  one  offence committed, being the refusal to produce the records for inspection.   This offence (CRN ending 2160) attracted a fine of $1,000 with court costs of $130.   Yet, in addition, the company was fined $400 with court costs $130 for failing without reasonable excuse to facilitate an inspection of the records, and also fined $500 with court costs $130 on each of the infringements relating to the register of complaints

and the register of licensees, drivers and vehicle details.  Mr Young argued that these cumulative penalties infringed the “double jeopardy” principle since there was in reality “only one refusal, thereby one alleged offence as the other alleged offences could not be separated”.

Evaluation

[48]     I do not propose to separately consider the personal attacks upon the Justices or the prosecutor; nor the arguments of partiality and predetermination.  There are two reasons for this.  In the first place this was an unusual case to the extent that the essential facts were not in dispute.  There was no escape from the conclusion that the company deliberately refused to allow an inspection or audit of its records to occur. In short, Mr Young was openly defiant in response to the officer’s endeavours to invoke his regulatory powers.  Hence, this is not a case where the decision makers were called upon to make credibility findings.

[49]     Secondly, this appeal is by way of rehearing on the notes of evidence: s119

Summary Proceedings Act 1957.  It follows that even if there was some problem in relation to the hearing in the District Court, such difficulty is met by virtue of the appellant’s exercise of its right to an appeal by way of rehearing in this court.  That said, I hasten to add that I make no finding of impropriety in relation to the hearing in the District Court.  It is evident from the record that there were difficulties.  But these, it seems to me, were occasioned more by the manner in which the defence case was conducted than anything else.

[50]     I have already dealt with the unreasonable search argument based on s21 of the Bill of Rights Act: see [20] and [21].   Accepting for present purposes that an inspection/audit  constitutes  a  search,  Mr  Smith  was  in  my view  empowered  to conduct such search whether pursuant to ss113 and 198 of the Land Transport Act, or by virtue of the relevant land transport rules to which I have already referred. Nothing additional was required.  Provided there was compliance with the terms of the relevant provisions (e.g. the search was to be conducted within normal office hours) the officer was entitled to inspect/audit the records without the need for a complaint or the need to identify specific reasons for his actions.

[51]     A more difficult point is whether the imposition of four separate penalties on the offence and the three infringements constituted double (or even quadruple) punishment.  The major charge, being the information which alleged a failure/refusal to comply with a lawful requirement under the Land Transport Act, carried a maximum penalty of $10,000.  It is not immediately apparent why a conviction for this offence, and a single substantial fine for its commission, would not have met the situation.

[52]     Mr Young’s submission was advanced with reference to s10(4) of the Crimes Act 1961 and s26(2) of the Bill of Rights Act.  These provisions are concerned with the double jeopardy principle, namely that an offender should not be liable to be convicted more than once for an offence or the same offence.  Correctly analysed, this is not a situation where the company has been twice charged in respect of the same offence.   There has only been one hearing.   It concerned four separate offences/infringements which were subtly different, albeit they arose out of a single event (the refusal to allow the company’s records to be inspected).

[53]     Accordingly, I do not consider this to be a case of double jeopardy.  Mr Zintl cited R v Moore [1974] 1 NZLR 417 (CA) which likewise concerned a situation of simultaneous convictions at a single hearing. The Court of Appeal referred to s10(3) of the Crimes Act which provides:

Where  an  act  or  omission  constitutes  an  offence  under  two  or  more provisions of this Act or of any other Act, the offender may be prosecuted and punished under any one of those provisions.

The Court had no difficulty in concluding that each of the drug charges was different in character and hence that the individual convictions were sustainable.  But that was not the end of the matter.

[54]     The Court observed at 421:

...   The most that can be said [of the multiple convictions] is that their simultaneous recording was unsatisfactory and prejudicial when one of the convictions  related  to  a  lesser  offence,  which  was  included  within  the greater.  Such a happening is to be guarded against in the interests of accused persons generally, ...

The Court then discussed its power, sitting on appeal, to deal with a case of multiple convictions  in  such  a  way  as  would  protect  the  offender  from  oppression  or prejudice.  Typically, this is done by quashing the sentences imposed in relation to lesser included offences, leaving intact the conviction and sentence imposed in relation to the major charge.   Equally, however, a court may quash some of the convictions, in particular where these should have been treated as alternatives to a major charge arising out of the same act or omission.

[55]     To my mind the present case is one covered by the observations of the Court of Appeal in Moore.  Technically, the offence charged, and the three infringements alleged, against the company were different.  The elements of each varied in some respect from the others.  But at the end of the day there was one operative act on the part of the company’s director, namely a refusal to allow an inspection/audit to occur.    At  that  point  the  major  offence  against  the  Land  Transport  Act  was committed, and so of necessity were the infringement offences.  But, standing back and viewing the matter in the round I am satisfied that this was clearly a case which demanded a single penalty on the major offence, and a conviction and discharge in relation to the associated infringements (unless the informant sought only a single conviction).

[56]     For these  reasons  I allow the appeals against  sentence in relation to the infringements and quash the fines and orders to pay court costs.  It may be that the company should have been fined more than $1,000 on the major charge, but I do not propose  to  adjust  that  penalty  given  the  background  and  in  the  absence  of

submissions on the point.

Solicitors:

Appellant – Mr D Young, 163 Maces Road, Christchurch. Raymond Donnelly & Co, Christchurch for Respondent.