Daleszak v Police

[2015] NZHC 1853

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

CRI-2014-441-24

CRI-2014-441-25 [2015] NZHC 1853

BETWEEN

BARBARA CLAIRE DALESZAK

NATALIE ANNA DALESZAK Appellants

AND

NEW ZEALAND POLICE Respondent

Hearing:	29 July 2015
Appearances:	M J Phelps for Appellants F E Cleary for Respondent
Judgment:	6 August 2015

JUDGMENT OF KEANE J

This judgment was delivered by me on 6 August 2015 at  3pm pursuant to r 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:

Crown Solicitor, Napier

DALESZAK v POLICE [2015] NZHC 1853 [6 August 2015]

[1]      On 6 May 2014, in the District Court, Napier, Barbara and Natalie Daleszak, after pleading guilty to failing on 11 April 2013 to comply with an examination order made under the Criminal Proceeds (Recovery) Act 2009, were convicted of those offences and discharged.  Judge B M Mackintosh declined to discharge them without conviction.

[2]      On 11 April 2013, the Judge held, they had refused to answer  questions concerning “quite crucial aspects” of an investigation the New Zealand Police were then making under the 2009 Act.   They had refused to answer, knowing the consequences, after legal advice.  They were in breach of an order of this Court.  The consequence of convictions for them as registered nurses could not be said to be out of all proportion to their offence.  That was an issue for the Nursing Council of New Zealand and for their employer.

[3]      On this appeal Barbara and Natalie Daleszak contend that the Judge was wrong not to discharge them without conviction: (i) she overstated the seriousness of their offending; (ii) she understated the consequences their convictions; and (iii) those consequences were out of all proportion to their offending.  They seek to have their convictions set aside.

Sequence of events

[4]      On 24 March 2011 the police executed a search warrant at the Wairoa home of Robert and Barbara Daleszak.   They discovered 15 mature cannabis plants, 23 drying cannabis plant branches hanging in the garage, and a variety of nutrients for cultivation.   The street value of the cannabis was said to lie between $57,000 -

$95,000.

[5]      The Daleszaks were charged with cultivating cannabis.  On 23 August 2011, at the first call-over, Robert Daleszak pleaded guilty to that offence.   Barbara Daleszak, then or later, was charged instead with allowing their property to be used for cultivation; as to which she was discharged at trial in September 2012 at the conclusion of the Crown case.

[6]      On 27 May 2011 the police received a report from Kiwibank, under the Financial Transactions Reporting Act 1996, advising them that on 8 April 2011, very shortly after Robert and Barbara Daleszak were charged, Barbara Daleszak had made two cash withdrawals totalling $165,000.  Later analysis showed that the funds had been gathered from other Kiwibank and ANZ accounts held by the Daleszaks and that term deposits had also been broken.

[7]      On 9 June 2011 the Daleszaks sold their Wairoa property for $120,000 to their daughter Natalie, who then lived, and apparently lives still, in the vicinity of Napier.  On that day also their mortgage was discharged.

[8]      On the day before that sale and purchase, as the police later discovered,

$61,255 cash had been deposited in Natalie Daleszak’s ANZ account, and $61,248 had then been transferred to the trust account of Napier solicitors.  On the day of the sale itself, they discovered also, $48,219 had been paid into Barbara Daleszak’s bank account from the trust account of Hastings solicitors.

[9]      On 20 July 2011, seeking documents, the police searched under warrant both the Wairoa property and Natalie Daleszak’s Napier property.  She then told the police that the $61,255 deposit had been made to her account on 8 June 2011 by a friend, who owed her money.  She refused to say who that was.  As to the balance of the

$120,000 purchase price, approximately $50,000, she said that she had paid that to her parents over the years.

[10]     Then or later the police also discovered that Barbara Daleszak, a nurse, and Robert Daleszak, a sickness beneficiary, held 16 ANZ and Kiwibank accounts and between August 2007 – April 2011 had saved $116,770; savings which could not be reconciled with their identifiable sources of income.  Mortgage payments and other identifiable outgoings had increased the proportion of unexplained funds still further.

[11]     On 17 October 2011 the police obtained from this Court in Wellington a restraining order under the 2009 Act to secure the property owned or controlled by the Daleszaks.  At that time, apparently, all three faced charges of money laundering

on which they were later discharged.  Then on 25 February 2013 this Court made the examination orders with which Barbara and Natalie Daleszak failed to comply.

[12]     On 11 April 2013 all three members of the Daleszak family were examined at the Napier police station in electronically recorded interviews.  Their lawyer went to the interviews with them to advise them.  The principal topics were the Daleszaks’ unexplained savings, the source and fate of Barabara Daleszak’s withdrawal, and the source of Natalie Daleszak’s deposit.

[13]     According to the agreed narrative on sentence, Barbara Daleszak said, as to her two cash withdrawals, “she had withdrawn the funds as she just wanted out of Kiwibank and that it was gone”.  She refused to be more specific, after having been warned of the consequence and taking advice.

[14]     Natalie Daleszak, when questioned, continued to say that she had paid her parents $50,000 over the years for their house.  As to the $61,255 deposit, she said this time that it came from a man with whom she had once had an extramarital affair. She too, after being warned and taking advice, refused to say more.

Statutory scope of appeal

[15]     This is an appeal against conviction under s 229 of the Criminal Procedure Act  2011.   The  issue  to  which  it  gives  rise  is  whether the  Judge  erred  in  her assessment to such an extent that a miscarriage of justice has occurred.  An appeal against the refusal of a discharge under s 106 of the Sentencing Act 2002 is by way

of rehearing.1   I must make my own assessment.

[16]     Section 106 of the Sentencing Act 2002 enables the Court to discharge an offender without conviction unless required to impose a minimum sentence, and a discharge is deemed to be an acquittal.2    However, s 106 is subject to s 107, which says this:

The Court must not discharge an offender without conviction unless the Court is satisfied that the direct and indirect consequences of a conviction would be out of all proportion to the gravity of the offence.

[17]     In Z (CA447/2012) v R, the Court of Appeal confirmed that s 107 requires the Court to consider (i) the gravity of the offence; (ii) the direct and indirect consequences of conviction; and (iii) whether those consequences are out of all proportion to the gravity of the offence.  The last, the Court said, is the key issue. Unless a conviction is out of all proportion, the Court lacks jurisdiction to exercise its s 106 discretion.3

[18]     The Court also emphasised that in assessing the gravity of the offence, and whether  a  conviction  would  be  out  of  all  proportion,  the  Court  must  take  into account all aggravating and mitigating factors relating to the offending and to the offender.    Disproportionality  under  s  107  cannot  be  assessed  completely  and

accurately otherwise.4

[19]     A further statutory dimension in this case is that, as the Judge was made aware, and took into account, once  convictions are entered, s 67 of the Health Practitioners Competence Assurance Act 2003 obliges the Registrar of the Court to notify the Nursing Council of New Zealand; and the Council becomes obliged under s 68(2) to refer those convictions to a professional conduct committee.

[20]     The convictions the Judge entered, as she was aware, put in issue whether

Barbara and Natalie Daleszak continued to be fit to be registered as nurses.  Section

16(c) makes a conviction a potentially disqualifying event.  It says that a person may not be registered as a health practitioner if:

He or she has been convicted by any Court in New Zealand or elsewhere of any offence  punishable  by imprisonment  for  a term of  three  months  or longer, and he or she does not satisfy the responsible authority that, having regard to all the circumstances, including the time that has elapsed since the conviction, the offence does not reflect adversely on his or her fitness to practise as a health practitioner of that profession.

Conclusions

[21]     I conclude, firstly, that  the Judge was right to  hold Barbara and Natalie Daleszak’s offending to be serious.  They failed, in reality refused, to comply with an order  this  Court  made  under  the  2009  Act;  an  offence  attracting  a  12  month maximum term or a $15,000 fine.5    Those orders required them to answer the very questions they refused to answer and thus they frustrated the specific intent of those orders.

[22]     That intent was to establish whether: (i) the unexplained funds in Mr and Mrs Daleszak’s accounts were attributable to drug offending; (ii) Barbara Daleszak’s cash withdrawal, soon after she her husband were charged, was to avoid the forfeiture of drug offending proceedings; and (iii) Natalie Daleszak’s purchase of her parents’ home was equally intended to prevent its forfeiture and was a purchase made using tainted funds. As the Judge said, moreover, the sums in issue were not insignificant.

[23]     The Judge took into account that Barbara Daleszak, otherwise a registered nurse of good standing, had two minor convictions, in excess of seven years before, until then masked by the Clean Slate (Criminal Proceeds) Act 2003, which would cease to be masked if a conviction were entered.  Also that this was to be Natalie Daleszak’s first conviction.

[24]     The  Judge  also  took  into  account  that,  if  she  entered  convictions,  the Registrar had then to give the Nursing Council notice, triggering a statutory process that might result in Barbara and Natalie Daleszak being deregistered and losing their jobs with the Hawkes Bay District Health Board.   She took into account, equally, that Natalie Daleszak, who had recently obtained a Bachelor of Nursing degree, her third tertiary qualification, was in a desirable post-graduate program offered by the Board.

[25]     The Judge was right to conclude, however, that these possible consequences were not out of all proportion to the seriousness of their offences; and that the

Council and Board should be entitled to assess for themselves whether Barbara and

5      Criminal Proceeds (Recovery) Act 2009, s 152.

Natalie Daleszak had ceased to be fit to be registered nurses and employees.  The Judge was also right to conclude that she could not predict, herself, what the likely outcome would be.

[26]     As the Judge was aware, the convictions she entered did not, of themselves, make  Barbara  and  Natalie  Daleszak  unfit  to  be  registered  nurses.    That  was something the Council, acting through a disciplinary committee, had to assess on a wider inquiry, taking into account that this was 2011 offending and that they had been nurses in good standing before and since.  The Board was similarly placed.  It was open to both to conclude that the offences were an  aberration, leaving the convictions entered without any adverse consequence.

[27]     Barbara and Natalie Daleszak responsibly advised the Nursing Council and the Board of their convictions, when those convictions were entered in May 2014, and  they  have  since  remained  registered  nurses,  in  employment,  awaiting  the outcome of this appeal.  That may work to their advantage when the Council and the Board assess how prejudicial their 2013 offences, which had their genesis in the first part of 2011, ought to be.

[28]     In order to resolve this appeal, however, I need only say that I find no error in

the Judge’s decision and that I agree with it.  I dismiss the appeal.

P.J. Keane J