Fowlie v Ministry of Social Development HC Auckland CRI-2011-404-000064
[2011] NZHC 879
•27 July 2011
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CRI-2011-404-000064
BETWEEN THERESA ANNE FOWLIE Appellant
ANDMINISTRY OF SOCIAL DEVELOPMENT Respondent
Hearing: 25 July 2011
Counsel: P J Barrowclough for Appellant
S C M Waalkens for Respondent
Judgment: 27 July 2011
In accordance with r 11.5 I direct the Registrar to endorse this judgment with the delivery time of 3.30pm on the 27th day of July 2011.
RESERVED JUDGMENT OF GENDALL J
[1] The appellant pleaded guilty in the District Court at Auckland to two charges of dishonestly obtaining, and continuing to receive, a student allowance which resulted in an overpayment to her totalling $8,504.74.
[2] The charges were that she knowingly made a false statement in a student allowance application to the effect that she was single and did not have a de facto partner, which was false because she was living with a man who was to become her husband. The second charge was that she wilfully failed to notify authorities that her spouse was working when she continued to receive the student allowance.
[3] Upon her pleas of guilty she was sentenced by District Court Judge B A Gibson in the District Court at Auckland on 21 January 2010 and was convicted and
fined $500 on each information and ordered to pay Court costs of $132.89.
FOWLIE V MINISTRY OF SOCIAL DEVELOPMENT HC AK CRI-2011-404-000064 27 July 2011
[4] She appeals against the entries of convictions and imposition of the penalties, on the basis that the Judge wrongly declined to grant to her a discharge without conviction pursuant to s 106 of the Sentencing Act 2002.
Appellate approach
[5] This is a general appeal under the Summary Proceedings Act 1957. It sometimes was said that appeals such as these are against the exercise of a judicial discretion and the appellant bears the onus of satisfying the Court that it should differ from the original decision. But before the Court may exercise its discretion under s 106 to discharge without conviction, the s 107 criteria provide a “gateway” or jurisdictional basis which must exist before the discretion is exercised. So the appeal in this case is not against the exercise of the District Court Judge’s discretion, but against the decision or finding that the adverse consequences of a conviction were not out of all proportion to the gravity of the offending. As was made clear in
Austin, Nichols & Co Inc v Stichting Lodestar,1 the appellate approach must be that
if this Court concludes the decision under appeal is wrong then it cannot stand.
[6] Whilst the s 106 discretion is said to be unfettered nevertheless that exercise does not arise unless the jurisdictional basis exists. So this general appeal requires the Court to come to its own view on the merits and exercise a substantive judgment taking into account and assessing the variety of factors which may be relevant to determining the question of whether a discharge without conviction is appropriate.
Background to offending
[7] Ms Fowlie is now aged 30 and a registered nurse employed at a hospital in Auckland. Her husband is a Nepalese citizen, employed and living in New Zealand. In order to pursue a course of study to obtain nursing qualifications, the appellant obtained a student allowance in July 2007 which, over a period of about 18 months, led to her receiving payments to which she was not entitled totalling $8,504.74. She
was not entitled to that because initially she was living in a de facto relationship and
1 Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141 at [16].
falsely stated that she was not. Secondly, after her partner became her husband, she failed to notify the authorities responsible for making student allowance payments that he was working in New Zealand. When the offending came to light, and the appellant was charged, she repaid the amounts fraudulently obtained by weekly payments and, finally, in lump sums. She has no previous convictions.
District Court proceeding
[8] In seeking that the appellant be discharged without conviction in the District Court, counsel advanced the submission that any convictions would be out of all proportion to the gravity of the offending, because they might affect her future travel to and employment as a nurse in Nepal, her husband’s place of origin; and they might affect her current employment and status as a registered nurse. It was contended (and accepted by the Judge) that the appellant offended while under some emotional stress and economic pressure, was remorseful and unlikely to offend again.
[9] In dealing with the appellant’s assertions that a conviction might have detrimental effect on her future career aspirations, in New Zealand and abroad, Judge Gibson said:2
Other than the defendant’s assertions there is no extrinsic evidence to support those contentions but I accept that if the defendant has to reveal her convictions to the New Zealand Nursing Council that is a matter the New Zealand Nursing Council may take into account. However I also accept her assertion it is unlikely to lead to the loss of her current employment.
[10] The Judge went on to say that the information of convictions could effectively be suppressed and an employer generally should know of convictions of dishonesty that may have occurred in the past. The Judge observed that the effect on the travel plans to Nepal was unknown and concluded:3
Overall I am not satisfied that the direct and indirect consequences of a conviction are out of proportion to the gravity of the offence. The offending
2 Ministry of Social Development v Fowlie DC Auckland CRI 2010-004-18997, 21 January 2001 at [8].
3 At [11] – [12].
was over a period of a year. I accept that the defendant was, ... under some emotional stress as a result of not knowing the status of her partner who subsequently became her husband and also under some economic pressure but neither of those matters are factors that persuade me to exercise my discretion in granting the application.
This was not a one-off incident. The defendant continued to receive the money knowing she was not entitled to it for a relatively long period of time. The money was taken from the public purse and public authorities depend considerably on the honesty of declarations that are put before them and the information supplied in those declarations in the course of paying public monies out. ...
Discussion
[11] Section 106 of the Sentencing Act provides that the Court may grant a discharge without conviction:
106 Discharge without conviction
(1) If a person who is charged with an offence is found guilty or pleads guilty, the court may discharge the offender without conviction, unless by any enactment applicable to the offence the court is required to impose a minimum sentence.
(2) A discharge under this section is deemed to be an acquittal.
...
[12] Section 107 provides guidance for the Court. It says:
107 Guidance for discharge without conviction
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.
[13] A three-step approach is accepted as a convenient and practical way to deal with applications for discharge. This has been affirmed in R v Hughes4 and Blythe v R.5 It contemplates:
(1) The gravity of offending should be first determined.
(2) The consequences of the conviction should be then identified.
4 R v Hughes [2008] NZCA 546, [2009] 3 NZLR 222.
5 Blythe v R [2011] NZCA 190, [2011] 2 NZLR 620.
(3)The Court must then consider whether the consequences of a conviction would be out of all proportion to the gravity of the offending.
[14] The wording of s 107 clearly adopts the test that emerged from the cases of Fisheries Inspector v Turner6 and Police v Roberts.7 The test in Turner dealt with s 42 the forerunner to s 19 of the Criminal Justice Act 1985. Richardson J (as he then was) said:8
Section 42 confers an unfettered discretion on the Court to give an absolute or conditional discharge without conviction in any case where a minimum penalty is not provided for. In the exercise of that discretion the Court must take all relevant considerations into account and must ignore all irrelevant considerations. The real question then is whether statutory consequences of a conviction may be taken into account and given appropriate weight as considerations relevant to the exercise of the discretion. Put in that way, there can be only one answer. In considering the exercise of the discretion under s 42 the Court is required to balance all the relevant public interest considerations as they apply in the particular case: or, as s 42(1) puts it, “after inquiry into the circumstances of the case”, which must refer to all the circumstances that are relevant in the particular case before the Court. It must have due regard to the nature of the offence and to the gravity with which it is viewed by Parliament; to the seriousness of the particular offending; to the circumstances of the particular offender in terms of the effect on his career, his pocket, his reputation and any civil disabilities consequential on conviction; and to any other relevant circumstances. And if the direct and indirect consequences of a conviction are, in the Court’s judgment, out of all proportion to the gravity of the offence, it is proper for a discharge to be given under s 42.
[15] Naturally, each case has to be considered on its own merits and it is obvious in R v Hughes that the guideline provided in s 107 does not alter the approach referred to in Roberts where, the Court of Appeal when referring to the effect of convictions upon a career of an offender, said:9
One of the considerations ... was the effect of a conviction on the career of the offender. ... What the Court must do is “to balance all the relevant public interest considerations as they apply in the particular case”. The public interest may require a conviction to be entered because of the nature of the offence and the particular occupation or proposed occupation of the offender. On the other hand, the offence may be so trivial that public interest does not call for a conviction to be recorded. In that case nothing of any
6 Fisheries Inspector v Turner [1978] 2 NZLR 233 (CA).
7 Police v Roberts [1991] 1 NZLR 205 (CA).
8 At 241 – 242.
9 At 210.
significance is being concealed. It has been said that the discretion should be exercised sparingly and only in exceptional cases but even those expressions tend to fetter the wide discretion ... and are hardly of any assistance. Obviously each case must be considered on its own merits and there would not be a proper exercise of the discretion if cases were treated one way or another depending on their category, such as shop-lifting cases or indiscretions by university students or cases in which a conviction would be relevant to the consideration of an independent statutory body or give rise to some absolute statutory prohibition. Those cases all involve particular problems, but in the final analysis, after considering all the relevant circumstances, it is a proper exercise of the Court’s discretion “if the direct and indirect consequences of the conviction are, in the Court’s judgment, out of all proportion to the gravity of the offence”. That must be the overriding consideration. The words, “out of all proportion” point to an extreme situation which speaks for itself.
[16] There is no onus on a defendant to establish that the test of disproportionality has been made out. The application of the test requires consideration of all the relevant circumstances of the offence and culpability of the offender. It was said by the Court of Appeal in R v Hughes that consideration is required of the relevant circumstances of the offence, the offending, the offender and the wider interests of the community, and includes an assessment of factors contained in ss 7, 8, 9 and 10
of the Sentencing Act.10 More recently, the Court of Appeal in Blythe v R said that
general sentencing factors set out in ss 7, 8, 10 and 10B were not relevant to the assessment of the gravity of the offending, and whether the consequences of a conviction would be out of all proportion to it. There the Court of Appeal said:11
That [statement in Hughes] appears partly to misstate the requirements of the s 107 disproportionality test. The aggravating and mitigating factors set out in s 9 of the Sentencing Act, and those listed in s 9A which deals with cases of violence against and neglect of children under 14 years, are obviously relevant to “the gravity of the offence”. But the content of ss 7, 8 and 9 is not. For two reasons, we wonder whether the passage [in Hughes] is an inadvertent misstatement. First, it cannot be reconciled with the correct statement of the position [which is contained in Hughes:12
“The test is the test. Simply, under s 107 the court must be satisfied that the direct and indirect consequences of a conviction would be out of all proportion to the gravity of the offence, before it may consider the exercise of the discretion conferred by s 106 to discharge without conviction.”]
Secondly, it does not reflect the Court’s approach in reviewing the way in which [the High Court Judge] applied the s 107 disproportionality test.
[17] The Court of Appeal in Blythe went on to say that the three-step approach is a helpful and practical way of applying the s 107 test with the Court first considering whether the disproportionality test in s 107 had been met.13 Thereafter:14
Only if it has been may the Court proceed to consider exercising its discretion to discharge without conviction under s 106. It is at that stage – when exercising the residual discretion under s 106(1) and in deciding whether further orders are required under s 106(3) – that the purposes and principles of sentencing set out in ss 7 and 8 of the Sentencing Act, the aggravating and mitigating factors listed in ss 9 and 9A ..., and the matters dealt with in ss 10 and 10B must all be taken into account. That is because all those sections apply, not only in sentencing, but also in “otherwise dealing” with an offender.
[18] It will be a rare case where an offender has satisfied the s 107 test and passed through that “gateway” that he/she not be discharged, but there still remains a residual discretion.15
Submissions of counsel
[19] Mr Barrowclough, in careful submissions, contended that the District Court Judge erred in placing undue or improper weight of the seriousness of the offending and insufficient weight on mitigating personal circumstances of the appellant. Further, he argued that the Judge did not properly satisfy himself as to the essential requirements that the consequences of a conviction would not be out of all proportion to the gravity of the offending. Mr Barrowclough submitted that although the offending was over a significant period it was not “prolific”, arose through emotional and financial pressures whilst under stress, and came to light through the appellant’s own disclosure of her status in December 2008. He submitted the Judge did not enter into an assessment of overall culpability when looking at the mitigating factors of the guilty plea, express remorse and the absence of previous convictions, and did not accurately assess the essential criteria of direct and indirect consequences outweighing the gravity of the offending. Counsel contended that Judge Gibson erred in stating that it was “unlikely” that the appellant would lose her employment, when the submission was that she “may not” face that outcome. He submitted that a
possibility existed that the appellant’s registration could be cancelled by the Health Practitioners Disciplinary Tribunal, and there was risk to her future career as a nurse, whether in New Zealand or Nepal.
The gravity of the offending
[20] The offending had as its foundation fraud or deception to obtain money from the State. It was of a type that is difficult to detect. It was not a momentary lapse or one-off incident. And it took place over a period of a year where the appellant received a significant amount of money to which she was not entitled. As a result of dishonest declaration and failure to advise of the true position public funds were paid to her.
[21] Whilst the Judge did not specifically record the mitigating circumstances of the offending and of the appellant – such as emotional stress, remorse and having no previous convictions – as bearing upon the gravity of the offending, he did refer to, and have in mind, the emotional stress that was experienced by the appellant and he referred to taking into account the early guilty plea, the appellant’s remorse and that she was unlikely to offend again.
[22] I do not consider the Judge erred in his assessment of the level of culpability and seriousness of this offending. It was far from trivial or minor.
Identified consequences of a conviction
[23] When it came to identifying the consequences that would flow from a conviction the Judge noted that no information was before him as to travel difficulties that might arise if the appellant had the conviction. He said that he accepted the appellant’s assertion that she was “unlikely” to lose her current employment, and although counsel says this was inaccurate, because what was in fact conceded was that she “may not lose her position”, I think the matter is one of semantics only. Naturally, it is not necessary for the Court to be satisfied that the feared consequences would inevitably or probably occur, but there has to be some real risk that they may possibly occur. In this case, other than the fear or concerns of
the appellant nothing was put before the District Court or this Court to provide any realistic support for those submissions. As counsel acknowledged in his submissions to the District Court, it was:16
somewhat speculative that these impediments to employment and travel will occur given there is nothing the defendant can point to now that will confirm the inevitability of this outcome.
[24] Counsel has referred this Court to a number of decisions of the New Zealand Health Practitioners Disciplinary Tribunal where nurses had their registration cancelled because of convictions for dishonesty. Mr Barrowclough submitted that there existed this possibility in the present case. There are no disciplinary proceedings or charges currently brought against the appellant nor any indication that that would follow. Even if it did, the only possible ground for disciplinary action would have to be based upon the conviction “of an offence that reflects
adversely on his or her fitness to practise”.17
[25] So the test is fitness to practise and a conviction of itself is not a disqualifying matter with consideration having to be given to the nature and circumstances of the offending. In many instances involving professional persons the test will be whether a professional is a fit and proper person to be a member of that profession, and examples of a proper approach can be seen in Commissioner of Inland Revenue v
Abdale,18 New Zealand Police v C-S,19 and Re Owen.20 All of these cases emphasise
that existence of a conviction does not prevent a determination that a person is a fit and proper person to be either admitted to a profession or remain as a member of it. On the other side of the coin, acquittals, whether on the merits or under the deeming provisions of s 106, do not of themselves determine whether a person is fit to be a member of the profession.
[26] There will be some risk that having these convictions may affect the
appellant’s nursing aspirations and pose some difficulties for her. But they will not present an absolute bar to her continued registration. And any such consequences of
16 Submissions in District Court at [43].
17 Health Practitioners Competence Assurance Act 2003, s 100(1)(c).
18 Commissioner of Inland Revenue v Abdale [2009] DCR 584 (DC).
19 New Zealand Police v C-S HC Napier CRI 2010-441-45, 14 February 2010.
20 Re Owen [2005] 2 NZLR 536 (HC).
a conviction as are identified are really no more than general consequences that follow upon convictions for dishonesty by members of the general public. Where there is deliberate dishonesty, and not at trivial level, the Courts must be careful not to create a special category of persons (such as professionals) for the purpose of discharging without conviction. So too, conversely, a person’s inclusion in such a class does not mean that they should be treated differently from other defendants who seek discharges without conviction. Focus must be on the particular circumstances of the offence and the offender and Courts are entitled to take into account the fact that there might possibly be some impact on an appellant’s suitability for remaining in, or entering, a profession when declining to grant a discharge. The possibility that there may be scrutiny of a person’s membership of a profession may be a consequence of a conviction, but in this case it is not out of all proportion to the gravity of the offence and particularly where the fact of the conviction does not, of itself, mean that there would be exclusion from the profession for that and only that reason.
[27] From the material before Judge Gibson, and also before this Court, I am satisfied that it has not been shown there is a real or appreciable risk that any consequences that might flow from the fact of a conviction being entered would be out of all proportion to the gravity of the appellant’s offending. If professional registration difficulties did arise that would be because of an assessment by the professional authority that the actions of the appellant and the conviction reflected adversely upon her fitness to be a nurse.
[28] I consider that Judge Gibson undertook the proper approach and necessary balancing test. I have independently come to the same view that despite the personal mitigating features counting in the appellant’s favour, this is not a proper case where a discharge without conviction should be granted. The direct and indirect consequences of conviction are not out of all proportion to the gravity of the offences.
[29] The appeal is dismissed.
J W Gendall J
Solicitors:
Crown Solicitor, Auckland
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