Hai v Ministry of Social Development
[2014] NZHC 2043
•27 August 2014
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CRI-2014-404-000128 [2014] NZHC 2043
BETWEEN MOHAMMED HAI
Appellant
AND
MINISTRY OF SOCIAL DEVELOPMENT Respondent
Hearing: 25 August 2014 Appearances:
J H A Wiles for Appellant
J D Cairney for RespondentJudgment:
27 August 2014
JUDGMENT OF COURTNEY J
This judgment was delivered by Justice Courtney on 27 August 2014 at 3.00 pm
pursuant to R 11.5 of the High Court Rules
Registrar / Deputy Registrar
Date……………………….
HAI v MINISTRY OF SOCIAL DEVELOPMENT [2014] NZHC 2043 [27 August 2014]
Introduction
[1] Mohammed Hai, pleaded guilty in the Manukau District Court to 19 charges of dishonestly obtaining Work and Income benefits totalling $115,470.50 over a ten- year period.1 Judge Winter sentenced him to 20 months’ imprisonment and ordered him to pay the full sum in reparation.2 Mr Hai appeals that sentence on the ground that it is manifestly excessive.
[2] Mr Wiles, for Mr Hai, acknowledged that the sentence of 20 months’ imprisonment was within the range available for the offending. The appeal is advanced on the basis that home detention was the appropriate sentence and the Judge was wrong to reject that in favour of imprisonment. In particular, it is asserted that the Judge:
(a) Wrongly assessed Mr Hai’s circumstances and the degree of planning and premeditation;
(b) Wrongly distinguished the case from Ransom v R;3 (c) Failed to refer to s 16(2) of the Sentencing Act 2002; (d) Failed to take account of the time spent in custody.
(e) Failed to take account of the size of the reparation order;
The offending
[3] Mr Hai obtained a domestic purposes benefit on the basis of applications dated 17 November 1998 and 18 February 2009 and an unemployment benefit on the basis of applications dated 3 March 2011 and 22 November 2012. When he signed the applications he agreed to advise the Ministry of any changes to his circumstances
that might affect his benefit entitlement.
1 Seven counts of obtaining by deception under s 240 Crimes Act 1961, three of using a document under s 229A and nine of dishonestly using a document under s 228.
2 Police v Hai Manukau DC CRI-2014-092-002228, 15 May 2014.
3 Ransom v R [2010] NZCA 390; (2010) 25 CRNZ 163.
[4] Throughout the relevant period Mr Hai told the Ministry that he was either single or not living in a relationship in the nature of marriage. In fact, he was married and had reconciled with his wife in September 1994. In addition, Mr Hai and his wife jointly owned a property in Rawene between July 2008 and December
2009. That asset would have precluded entitlement to supplementary assistance. In December 2009 they sold the property to their family trust and did not declare the proceeds of sale as an asset.
[5] Thirdly, between April 2003 and August 2005 and February 2009 and September 2009 Mr Hai was running a business and receiving income from it which he failed to disclose to the Ministry. Instead, he submitted forms to support applications for domestic purposes benefit and temporary additional support that falsely stated he had no other income.
[6] Finally, in August 2009 Mr Hai changed his name from Mohammed Naushad Hai to Naushad Ali and in 2011 applied for an unemployment benefit under his new name. He falsely stated that he was not known by and had not used any other names and did not disclose to the Ministry that he was already in receipt of a domestic purposes benefit under his previous name.
Sentencing in the District Court
[7] Judge Winter reviewed the circumstances of the offending and identified the aggravating features as being the substantial loss that resulted from the offending, the extreme level of premeditation and planning involving a high degree of organisation, Mr Hai’s knowledge, which included efforts to mislead the probation officer during an interview over the offending, the sustained period of the offending and the impact on the community and breach of trust within the community.
[8] The Judge noted but did not take into account Mr Hai’s previous conviction
for theft in 2002 and for fraud and false statements in 1991 and 1987.
[9] The Judge then turned to consider the relevant authorities and, in particular, noted the Court of Appeal’s decision in Ransom v R which involved fraud over a similar period and a similar level of loss and in which the Court of Appeal had
substituted a sentence of nine months’ home detention and 75 hours community work for the original 18 month sentence of imprisonment. However, the Judge distinguished Ransom on the basis of the higher degree of planning, premeditation and persistence in Mr Hai’s offending. He said:
[14] I also find that unlike many benefit fraud cases that come before this Court that are inspired by poverty and poor circumstances or where the benefit applicant has had a dramatic change in their status, your fraud involved such deception, planning and premeditation that you even changed your name and applied for benefits under that new name. This deception so as to receive two benefits at the same time to which you were not entitled.
…
[16] I am not satisfied that home detention would be a consistent penalty within the raft of benefit fraud cases that typically come to this Court. I am not satisfied that home detention would meet the purposes and principles of the Sentencing Act 2002. I am satisfied that imprisonment is the least restrictive option.
[10] Taking Mr Hai’s age, limited previous criminal history, the Judge imposed a sentence of 20 months’ imprisonment and an order for reparation in the full sum sought by the Ministry at the rate of $40 per week.
Appeal
Judge’s inferences regarding the offending and Mr Hai’s circumstances
[11] Mr Wiles submitted that the Judge made unjustified assumptions about a number of significant factual matters that he viewed as aggravating factors.
[12] First, although Mr Hai was reconciled with his wife at an early stage he says that that the reconciliation was not a full reconciliation; although they lived in the same house, they effectively lived apart. The limited extent of Mr Hai’s reconciliation with his wife was, in fact, recorded in the pre-sentence report and not referred to by the Judge but there is no indication that this was raised as a defence at the trial; the fact of the reconciliation was referred to in the summary of facts, to which Mr Hai agreed and was an underlying fact relied on by the prosecution. The acknowledgement of that fact was not a matter that the Judge could put to one side on Mr Hai’s assertion (without evidence) that the reconciliation was not a full one.
[13] Secondly, Mr Wiles submitted that the proceeds of sale from the Rawene property were modest because of existing mortgages, Mr Hai’s freight business was struggling, he had marital problems and financial hardship which created difficulties providing for his family. He said he was depressed and struggling. There is reference to the financial difficulties in his business in the pre-sentence report but not of any of the other matters and there appears not to have been any other material before the Judge. So whilst the Judge does seem to have drawn an inference at [14] that Mr Hai’s circumstances were not poor, the existence of a house or proceeds of sale of a house would have justified that inference.
[14] The Judge also referred to Mr Hai’s lack of frankness in his interview with the probation officer, including Mr Hai’s assertion that he had personal jewellery over $100,000. The Judge treated this as a lie because at the time the jewellery had been stolen in a burglary. Mr Wiles advised me that this was not in fact a lie because Mr Hai had made an insurance claim in respect of the jewellery and therefore expected to receive the value of the jewellery. But there is no material to support that assertion; Mr Hai did not provide an affidavit in support of his appeal regarding either the existence or outcome of the insurance claim.
Distinguishing Ransom v R
[15] Mr Wiles submitted that the Judge was wrong to distinguish the circumstances of Ransom v R in rejecting home detention as appropriate.4 In particular Mr Wiles argued that the Judge’s view of Mr Hai’s offending as involving an “extreme level of premeditation and planning involving a high degree of organisation” greater than that in Ransom was not justified. The Judge had noted the use of multiple types of application forms and the receipt of benefit in two names.
Given the sustained period of offending and the use of a second name to dishonestly obtain a benefit, the Judge’s view of the offending was not unjustified.
[16] Mr Wiles pointed out that Ransom involved benefit fraud over a period of nearly ten years, involving a total of nearly $128,000 and argued that that the
offending in Ransom could not be viewed as less serious than the present case. He
4 Ransom v R, above n 3.
also suggested that there may have been other reasons for Mr Hai’s change of name but there was nothing before the Judge (or me) to suggest what those reasons were. Whilst the period of the offending and the amount of money involved was comparable I agree with the Judge’s view that Mr Hai’s dishonest application for further benefits in another name did justify viewing his offending as worse than Ransom.
[17] In any event, the issue is not whether the offending in Ransom was more or less serious than Mr Hai’s offending. The issue in this appeal is whether the Judge erred in his assessment of home detention as inappropriate; the Court of Appeal was explicit in Ransom that there is no consistent rule to be applied in sentencing on benefit fraud cases; in some cases home detention will be appropriate but in some it will not be. Ransom is distinguishable in relation to the factors that the Court identified justifying substitution of a sentence of home detention for imprisonment. In particular, in addition to health issues, Ms Ransom had previously had the care of her six-year-old child and the result of her being sent to prison was that her husband had to give up work and go onto a social welfare benefit. The personal circumstances of the appellant in Ransom were very different to Mr Hai’s circumstances and certainly justified a different approach. Taking into account all of the relevant factors including his medium risk of re-offending and the fact that the previous sentence for dishonesty offending did not deter this offending means there is no error in the Judge’s decision to refuse home detention.
Did the Judge fail to take account of s 16(2) of the Sentencing Act?
[18] Mr Wiles submitted that the Judge had made an error in failing to refer to s
16(2) of the Sentencing Act 2002, which requires the Judge to have regard to the desirability of keeping offenders in the community as far as that is practicable and consonant with the safety of the community and, in particular, precludes the imposition of a sentence of imprisonment unless the Judge is satisfied that it is being
imposed for a purpose under s 7(1)(a) – (c), (e), (f) or (g)5 and those purposes could
5 Holding the offender accountable, promoting a sense of responsibility, providing for the interests of the victim, denouncing the conduct, deterence and protection of the community.
not be achieved by a sentence other than imprisonment and no other sentence would be consistent with the application of the principles in s 8.
[19] Although the Judge did not refer specifically to s 16(2), he said at [16]:
I am not satisfied that home detention would be a consistent penalty within the raft of benefit fraud cases that typically come to this Court. I am not satisfied that home detention would meet the purposes and principles of the Sentencing Act 2002. I am satisfied that imprisonment is the least restrictive option.
[20] I am satisfied from this statement and the totality of the Judge’s approach that he was alive to the requirements of s 16(2) and took them into account in determining the appropriate sentence in this case.
Not taking account of time in custody
[21] Mr Wiles pointed out that Mr Hai had spent three months in custody. He drew my attention to the decision of this Court in Werahiko v Ministry of Social Development in which a sentence of imprisonment was set aside and submitted that one of the relevant factors was that the appellant had already spent two months in
custody.6 That interpretation of the case is different from my own. I read Heath J’s
decision as determining that home detention was the appropriate sentence for other reasons and taking account of the time spent in custody only in relation to fixing the length of the home detention sentence.
The effect of the reparation order
[22] Finally, Mr Wiles pointed out that the Judge had made a reparation order for the full amount of the loss. He submitted that this fact, coupled with the term of imprisonment, placed an unfair burden on Mr Hai. However, the Judge did recognise this by allowing a further reduction of four months from the provisional sentence of
24 months that he had reached.
6 Werahiko v Ministry of Social Development HC Rotorua CRI-2008-463-55, 5 September 2008.
Result
[23] The Judge has properly taken account of the relevant factors. I see no error in his assessment of the appropriateness of home detention.
[24] The appeal is dismissed.
P Courtney J