Counsel:A R Davie for Appellant F E Guy Kidd and J E Mildenhall for Respondent
Judgment:13 May 2010
ORAL JUDGMENT OF THE COURT
The appeal is dismissed. ____________________________________________________________________
REASONS OF THE COURT
(Given by Harrison J)
Introduction
[1] Mr Lance James appeals against a sentence of two years imprisonment imposed upon him in the District Court at Wellington following his conviction on a total of 19 offences under the Tax Administration Act 1994.
[2] Mr James' counsel, Mr Davie, accepts that the sentence of two years imprisonment was within the available range. But he submits that the Court should have imposed home detention. The only issue is whether the Judge erred in sentencing Mr James to a term of imprisonment.
Facts
[3] There is now no material contest about the facts.
[4] Mr James' offending fell into two discrete categories. The first comprised eight counts of knowingly failing to file tax returns intending to evade the assessment or payment of tax. He was found guilty of these offences following a summary trial before Judge Tuohy. Each count related to a particular year within the eight tax years extending from 31 March 1998 to 31 March 2005 inclusive (he was acquitted on a further charge of failing to file a return for the year ending 31 March 2006).
[5] The Judge was satisfied that Mr James "earned reasonably substantial income" during the eight year period. The amount of tax notionally evaded was $174,206. This figure was estimated following Mr James' submission of returns years late. Mr James has since paid $147,328. The balance owing is $26,877 excluding penalties and interest.
[6] Judge Tuohy found that Mr James used his evaded tax payments to provide "a very comfortable lifestyle" for himself and his family; and that some of the money was applied towards building an "expensive home". The Judge was hesitant to describe the nature of Mr James' offending as theft. But we are satisfied that it could not colloquially be described in any other way.
[7] The second category of charges was of aiding or abetting four companies which Mr James controlled to knowingly apply PAYE deductions other than in payment to the Commissioner. The 11 offences occurred between 1 November 2007 and 31 May 2008. Mr James pleaded guilty at trial. Judge Tuohy found that the total amount of PAYE diverted for Mr James' purposes was $181,978, of which $141,360 remains outstanding. All four companies are now in liquidation and there is no prospect of recovering unpaid tax.
[8] In the period of this offending a property development undertaken by Mr James encountered financial difficulties. To maintain the solvency of his companies, Mr James elected to divert PAYE deductions payable to employees to meeting other debts. Judge Tuohy was satisfied that Mr James had the money available to meet his obligations to the…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
Continue reading James v R
Sign in free to access the full text
Details
AGLC
James v R [2010] NZCA 206
Case
[2010] NZCA 206
Decision Date
CaseChat Overview and Summary
Lance Christopher James appeals against a sentence of two years imprisonment imposed upon him in the District Court at Wellington following his conviction on a total of 19 offences under the Tax Administration Act 1994. The appeal concerns the court's decision to impose imprisonment rather than home detention. The primary issue for the Court of Appeal is whether the Judge erred in sentencing Mr James to a term of imprisonment, considering the submission that home detention could have adequately satisfied the principles of deterrence and denunciation. The facts of the case involve two categories of tax evasion offences, with the first category consisting of eight counts of knowingly failing to file tax returns intending to evade the assessment or payment of tax, and the second category involving aiding or abetting four companies controlled by Mr James to knowingly apply PAYE deductions other than in payment to the Commissioner. The court must decide whether the Judge correctly exercised his sentencing discretion by determining whether home detention would adequately denounce and deter Mr James' serious offending.
The Court of Appeal found that the decision about whether home detention would meet the objectives of deterrence and denunciation is a matter of judgment for the sentencing Judge. Judge Tuohy was uniquely placed to assess the seriousness of Mr James' offending, having conducted the trial and delivered a full judgment. The Court was satisfied that Judge Tuohy was not satisfied that a sentence of home detention would adequately denounce and deter someone like Mr James who had offended on such a scale and duration. The Court concluded that the Judge did not err in imposing a sentence of two years imprisonment instead of a term of home detention, and Mr James' appeal was dismissed.