Huddleston v Ministry of Social Development HC Napier CRI-2007-441-19

[2007] NZHC 1875

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

CRI-2007-441-19

CARA HUDDLESTON

Appellant

v

MINISTRY OF SOCIAL DEVELOPMENT

Respondent

CRI-2007-441-20

WILLIAM TUTU KAWENGA

Appellant

v

MINISTRY OF SOCIAL DEVELOPMENT

Respondent

Hearing:         20 June 2007

Appearances: Mr S B Manning for Crown

Mr G W Calver for Huddleston
Mr A Sharko for Kawenga

Judgment:      20 June 2007

(ORAL) JUDGMENT OF LANG J [on appeal against sentence]

Solicitors:

Crown Solicitor, Napier
Counsel:
Mr A Sharko, Napier

Mr G W Calver, Hastings

HUDDLESTON & KAWENGA V MINISTRY OF SOCIAL DEVELOPMENT HC NAP CRI-2007-441-19 20

June 2007

[1]      Mr Kawenga and Ms Huddleston pleaded  guilty in the District Court to several charges laid under the Crimes Act 1961 and the Social Security Act 1964. Mr Kawenga pleaded guilty to five charges.    Three of these were for dishonestly using documents, one was for wilfully omitting to provide information and one for making a false statement.   Ms Huddleston pleaded guilty to four charges.   Two of these were for making a false statement and two were for obtaining a pecuniary advantage.   All of the charges to which the appellants pleaded guilty arose out of a situation  in  which  they claimed  for,  in  the  case  of  Ms  Huddleston  a  domestic purposes benefit, and in the case of Mr Kawenga an unemployment benefit.

[2]      The informant’s case in the District Court and as accepted by the appellants, was that each of them had made false statements to the New Zealand Work & Income Service and that this had permitted them to receive an unemployment benefit or domestic purposes benefit to which each appellant was not entitled.

[3]      In the District Court His Honour Judge Adeane sentenced each appellant to six months imprisonment.     Each now appeals to this Court on the basis that in imposing sentence the learned District Court Judge applied erroneous principles or, alternatively, imposed sentences that were manifestly excessive in all the circumstances.

Factual background

[4]      In order to give context to the appeals I propose to set out in some detail the factual background that led to the charges being laid.   I have gleaned this from the summary of facts, to which I understand no exception was taken when the appellants were sentenced in the District Court.

[5]      The period of the actual offending extended from 16 June 2004 to May 2006. The events that gave rise to the offending commenced, however, a little earlier than June 2004.

[6]      In May 2004 Mr Kawenga and Mr Huddleston were living together in Napier with their four children.   Mr Kawenga was working at that time as a wool scourer.

He finished working at the wool scour on or about 28 May 2004, and on 31 May

2004 he applied for an unemployment benefit at the Opotiki office of the Work & Income Service.    When he applied for the benefit at this time he indicated that he had moved to Opotiki and that his relationship with Ms Huddleston had been terminated.

[7]      On   4   June   2004   Mr   Kawenga   completed   a   re-application   for   an unemployment benefit and again lodged it at the Opotiki office of the Service.   On that form he said that he did not have a partner.   On signing the application for the unemployment benefit Mr Kawenga agreed to immediately advise the Service if there were any changes to his circumstances that may affect his entitlement to the unemployment benefit.

[8]      As a result of completing these documents Mr Kawenga came to receive an unemployment benefit and accommodation supplement based on the fact that he was living alone.

[9]      On 16 June 2004 Ms Huddleston wrote a letter to the Service stating that her son, Eziah, had left her care and was now in Mr Kawenga’s care.   The next day Mr Kawenga completed an application to include Eziah within his benefit and he lodged it at the Opotiki office of the Work & Income Service.   On that form Mr Kawenga said that Eziah had come into his care on 8 June 2004.    As a result of these two documents Mr Kawenga’s benefit was increased to reflect the fact that he had the care of Eziah.

[10]     On 22 June 2004 Ms Huddleston completed an application for a domestic purposes benefit and lodged it at the Napier office of the Service.   On that form she said that she and her partner had broken up and that he had moved away to Opotiki. As a result, she was granted a domestic purposes benefit from 5 June 2004.    The benefit was granted on the basis that she was a sole parent having the care of three dependent children.

[11]     Although the summary of facts records that between 4 and 28 June 2004 Mr

Kawenga and Ms Huddleston were still living together in a relationship in the nature

of marriage I infer that that was not in fact the case until approximately 28 June

2004.    On that date Ms Huddleston travelled to Opotiki, where she began to live with Mr Kawenga and all four children.

[12]     On the same day Mr Kawenga commenced seasonal employment.    He did not advise the Service of his change in financial circumstances, and accordingly continued to receive an unemployment benefit notwithstanding the fact that he was working in this employment until 4 December 2004.

[13]     On or about 15 December 2004 Mr Kawenga and Ms Huddleston returned to

Napier from Opotiki and resumed living together in Napier with their four children.

[14]     On 11 April 2005 Ms Huddleston completed an application to review her entitlement to the domestic purposes benefit.   On that form she stated that she was not living with anyone in a relationship in the nature of marriage.   As a result, she continued to receive the domestic purposes benefit thereafter.

[15]     On   3   November   2005   Mr   Kawenga   lodged   an   application   for   an unemployment  benefit  at  the  Napier  office  of  the  Service  after  he  had  ceased working for a shearing contractor.   On that application he said that he did not have a partner and that he had a son, Eziah, living in his care.    As a result of completing that document Mr Kawenga was again granted an unemployment benefit together with an accommodation supplement in respect of his son.    During this period, of course, Mr Kawenga was in fact living with Ms Huddleston and their children in Napier.

[16]     On  21  January  2006  Mr  Kawenga’s  unemployment  benefit  was  stopped because he returned to work.   Two months later, on 9 January 2006, Ms Huddleston was interviewed by a field officer employed by the Service.   During this interview she expressly stated that she was not in a relationship with Mr Kawenga.

[17]     On 23 March 2006 Mr Kawenga lodged an application for an unemployment benefit after he ceased working for the shearing contractor.   Again he stated on his application form that he did not have a partner and that he had a son, Eziah, living in

his care.     Again, he was granted an unemployment benefit and accommodation supplement in respect of his son.

[18]     Ms Huddleston was eventually interviewed again on 11 and 17 May 2006. During these interviews she accepted that she had not separated from Mr Kawenga at all, and she confirmed that she had been living in a relationship in the nature of marriage with him from the time that she had applied for the domestic purposes benefit.   By way of explanation she said that she and Mr Kawenga had agreed that she would apply for the domestic purposes benefit because they needed the money.

[19]     Mr Kawenga was interviewed on the following day.   He, too, admitted that he had not separated from Ms Huddleston at all and that they had been living together in a relationship in the nature of marriage continuously since the time at which she had applied for a domestic purposes benefit.   When he was asked for an explanation, he said that he had told the Service that he was separated so that Ms Huddleston could continue receiving the domestic purposes benefit because they needed the money.

[20]     The summary of facts records that as a result of their offending Mr Kawenga was overpaid the unemployment benefit and accommodation supplement in the sum of $6,968.76.    Ms Huddleston was overpaid the domestic purposes benefit in the sum of $19,039.22.

The approach taken in the District Court

[21]     Both appellants were represented by the same counsel, Mr Sharko, when they came to be sentenced in the District Court at Napier on 15 May 2007.   Mr Sharko advised me today that his submissions so far as Mr Kawenga was concerned were directed towards an overall submission that the Court should adopt the recommendation in the pre-sentence report that he be sentenced to a term of approximately 200 hours community work.    He advised me that at the sentencing hearing he concentrated his submissions on Ms Huddleston’s position, because he appreciated that she was on the cusp of receiving a sentence of imprisonment.   He told me today that his submissions in respect of each appellant were addressed to the

Judge separately and that he did not suggest to the Judge that they should be dealt with on a joint basis.

[22]     The written submissions that were filed on behalf of the informant have also been made available to me.     They reveal that the informant did not seek any particular sentence.     The informant’s submissions were directed towards the aggravating features of the offending, the purposes of the sentencing process and the principles to be applied in relation to that process.

[23]     Judge Adeane accepted that each appellant fell to be dealt with separately. He noted, however, that the matters before him were closely related.   He noted also that he had suggested to counsel during argument that “in effect what was at foot here was a conspiracy to defraud the welfare”.   He observed that he used that term loosely and not in its strict legal sense.     He went on to note, however, that, in essence, the two appellants had set about a course of conduct that had resulted in them receiving a significant overpayment to that to which they were entitled.    On that basis the Judge chose to treat each appellant equally and it was on that basis that he imposed a sentence of six months imprisonment on each.

The grounds advanced on appeal

[24]     Counsel for both appellants submit that the Judge approached the sentencing process on the basis of an erroneous principle.   They contended that the Judge had failed to distinguish between the respective positions of the two appellants and, in particular, he failed to distinguish between each of them in terms of the culpability of the charges to which they had individually pleaded guilty.   Counsel submitted that the Judge was wrong to approach the sentencing process on a global basis, and that he ought to have considered each appellant individually.    Both counsel submitted that, when such an approach was undertaken, the sentence that was imposed on each appellant was manifestly excessive.

[25]     For the informant, Mr Manning accepted that the charges that Mr Kawenga faced would not ordinarily have been of sufficient gravity to attract a sentence of imprisonment.      He  accepted  Mr  Sharko’s  submission  that,  standing  alone,  the

charges that Mr Kawenga faced would attract a sentence of approximately 200 hours community work.   He accepted also that that was the recommendation contained in the pre-sentence report.

[26]     Mr Manning submitted, however, that the sentence that the Judge imposed on Ms Huddleston was within the range of sentences that was open to him in terms of the authorities.   He therefore submitted that, even if the Judge had approached the matter by applying an erroneous principle, nevertheless the end result was correct and should not be disturbed by this Court on appeal.

Decision

Mr Kawenga

[27]     I deal first with the appeal by Mr Kawenga.    Given the matters to which I have already referred, it is clear that Mr Kawenga’s appeal must be allowed.    In reaching this conclusion I can understand entirely how the learned District Court Judge came to adopt the approach that he did.   The summary of facts itself records the concession by each appellant that they had reached an agreement that they would each apply for benefits to which they were not entitled in order to finance the needs of the household.

[28]     The respondent’s submissions also dealt with the culpability of the appellants on  a  basis  that  can  realistically  be  described  as  global.      In  particular,  the respondent’s written submissions contained a statement to the effect that, “together they obtained $26,007.98”.   It is clear that the informant also approached offending on a global basis, and I have no doubt that the Judge picked up on this in adopting the approach that he did on sentencing.

[29]     In many ways, too, it can readily be seen that such an approach may be calculated to best achieve a just result overall.     Unfortunately, however, the sentencing Judge was required to deal with the culpability of each appellant only on the basis of the discrete charges to which each had pleaded guilty.   Neither of them

was charged jointly with the other, with one exception.   The offending by each was therefore discrete and separate, one from the other.

[30]     For these reasons the appeal by Mr Kawenga is allowed.   He has now served more than four weeks in custody.     Both counsel agree that this is at least the equivalent, if not more, of 200 hours community work.    On that basis I quash the sentence of six months imprisonment so far as Mr Kawenga is concerned.    In its place I impose a sentence of six weeks imprisonment.

Ms Huddleston

[31]     The position is, however, somewhat different so far as Ms Huddleston is concerned.   If Mr Kawenga was prejudiced to some extent by the approach that the Judge adopted, Ms Huddleston may well have been the beneficiary of it.    On one view of this case it could be said that she received the benefit of a reduction in her sentence by virtue of the fact that Mr Kawenga may have received a sentence that was greater than that which would ordinarily have been justified.

[32]     It is important, however, for me to bear in mind that I should only interfere with the sentence that was imposed in the District Court if it was manifestly excessive.   Counsel have referred to me a number of authorities that were available to the sentencing Judge in the District Court.    These include a schedule of cases from this particular region during the period that this offending occurred.     The schedule shows, that although with no degree of consistency, that benefit fraud in which the overall loss is in the region of $20,000 has been met in several instances in the past with sentences of six months imprisonment.

[33]     Moreover, the leading authority on this point is the decision of the Full Court of this Court in Hogan v Ministry of Social Development HC Napier 8 July 2005

CRI-2005-441-24/25/26/27/28 Gendall and McKenzie JJ.    In that case the Court reviewed the sentences imposed on five appellants who had been convicted of what can broadly be described as benefit fraud.   In each of these cases the appellants had received between four and nine months imprisonment for offending that involved the fraudulent obtaining of benefits ranging between $22,766 and $48,586.

[34]     The Court confirmed that there is no tariff or guideline sentence for this type of offending.   Each case must be assessed according to its own facts because the facts of each case will vary widely.   The amount that has been fraudulently obtained in each case will, of course, be a relevant factor but it is by no means the only factor. Taking into account the circumstances of each of the appellants individually, the Court in Hogan was not persuaded that any of the sentences could be described as manifestly excessive.

[35]     The Court also noted, however, that in sentencing of this type the essential issue will often be a balancing exercise in which the need for deterrence is balanced against the mitigating factors that each case raises.    In my view that is very much the exercise that needs to be undertaken in the present case.

[36]     I  consider  that  Ms  Huddleston’s  offending  did  have  several  aggravating factors.   They go well beyond the monetary amount that she obtained as a result of her offending.   First, there is the fact that the offending commenced in a deliberate way.   It arose as the result of an express agreement between Ms Huddleston and Mr Kawenga that each would apply for benefits to which they were not entitled in order to increase the household income.

[37]     Secondly, the offending was sustained because it occurred over a period of approximately two years.

[38]     Thirdly, it took various forms and was repeated on a number of occasions.

[39]     Fourthly, Ms Huddleston was prepared to involve herself in the offending of Mr Kawenga by writing a letter confirming that her son had moved to live with Mr Kawenga in Opotiki.     That directly assisted Mr Kawenga to obtain an increase to his benefit to which he was not entitled.

[40]     Fifthly,  there  is  the  fact  that  at  the  interview  on  9  January  2006  Ms Huddleston  expressly  denied  that  she  was  living  or  had  been  living  with  Mr Kawenga.   That, of course, was a blatant lie.   It was also a lie told at a time when it was incumbent on Ms Huddleston to disclose the true nature of her relationship with Mr Kawenga.    Not only that, but thereafter she continued to receive the domestic

purposes benefit for a  period of months before she finally accepted the reality of the situation at the interviews in May 2006.

[41]     Finally, there is the fact that Ms Huddleston must clearly have been aware of her obligations.   On 3 June 2003 she received a letter from the Service following an overpayment that was made to her.   I infer from the summary of facts that this arose in some way as a result of the fact that she had been working at the time that a benefit was paid to her.    The warning letter that was sent to her at that time must have placed her on notice that she needed to be frank with the Service in the future in any dealings that she might have with it.

[42]     Taken together, I am satisfied that these factors mean that the sentence of six months imprisonment that the Judge imposed on Ms Huddleston was well within the range that was open to him.    In reaching that conclusion I have not ignored three further submissions that Mr Calver advanced on behalf of Ms Huddleston today.

[43]     The  first  of  these  was  that  it  is  an  oversimplification  to  say  that  Ms Huddleston received an overpayment of approximately $19,000.     Mr Calver submitted that this household would always have been entitled to a benefit of one form  or  another  that  would  closely  equate  in  monetary  terms  what  it  actually received.     I draw from this submission the inference that, if Mr Kawenga had applied for an unemployment benefit and disclosed the fact that he was living with Ms Huddleston and their children, the amount of the unemployment benefit that he would have received would have been approximately the same as the total amount that Mr Kawenga and Ms Huddleston received through their respective benefits.

[44]     There is no way, however, that I can make any finding on this point.   I have absolutely no  material  before me that  would  allow  me to  draw  any conclusion regarding the comparable value of what was actually received as against that which may have been received had the true situation been disclosed to the Service.    This submission, in any event, really needs to be seen in context.  What is important here is not so much the amount of money that was obtained, but the amount of money and the length of time over which payments were made when the Service had no idea of the true situation.

[45]     It is of the utmost importance to the administration of the welfare or benefit system  that  those  who  seek  to  receive  benefits  are  completely  honest  with  the Service in their dealings with it.    The Service must be entitled to proceed on the basis  that  it  can  accept  the  word  of  beneficiaries  regarding  their  financial  and domestic situations.    It is very hard for the Service to detect offending that occurs when people make false representations regarding their work or living situations. That, really, is the essence of the gravity of this offending.    It is not the monetary loss so much as the fact that a significant sum was paid out over a substantial period in ignorance of their true situation.

[46]     The second point that Mr Calver made was that these parties had in fact separated for some period.   I accept that submission to some extent, but quite clearly there were also significant periods in which they were living together and in respect of which they claimed benefits to which they were not entitled.

[47]     The  third  matter  was  that  the  learned  District  Court  Judge  did  not  pay sufficient attention to the personal circumstances of the appellant.     This was a situation in which she was a caring mother and she was seeking only to provide for the needs of her family.    In those circumstances Mr Calver submitted that there could be no suggestion that the offending was motivated by greed.

[48]     I accept that submission so far as it goes.   The difficulty is that this type of situation often arises in cases of this type.    The District Court must regularly see cases where offending has occurred as a result of a perceived need to supplement a family’s income through the receipt of benefits to which there is no entitlement.    I do not consider that this particular fact, or the fact that Ms Huddleston is a first offender, is sufficient to persuade me that the sentence that was ultimately imposed was one that was outside the range of sentences open to the sentencing Judge.

[49]     I am conscious of the fact that Ms Huddleston’s imprisonment has caused her a great deal of hardship.   She has a large family and she has been separated from it for some time.    She will not be able to have her application for home detention heard until 9 July 2007.    All of those matters, however, arise in any situation in which a mother receives a sentence of imprisonment for offending of this type.

Whilst it is always a matter of regret and hardship to the family, it is not a matter that can affect this Court’s jurisdiction on appeal to disturb a sentence that was otherwise properly imposed in the Court below.

[50]     The appeal against sentence by Ms Huddleston is accordingly dismissed.

Lang J