Linsell v Ministry of Social Development HC NP CRI 2009-443-000029

[2009] NZHC 2517

IN THE HIGH COURT OF NEW ZEALAND

NEW PLYMOUTH REGISTRY

CRI 2009-443-000029

BETWEEN  KAREN MARIE LINSELL

Appellant

ANDMINISTRY OF SOCIAL DEVELOPMENT Respondent

Hearing:         16 December 2009

Appearances:  N R Harding & N Christopher for the Appellant

AWM Britton and J Gurnick for the Respondent

Judgment:      18 December 2009 at 11.00 am

RESERVED JUDGMENT OF PRIESTLEY J

This judgment was delivered by me on 18 December 2009 at 11.00 am

pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date:………………………….

Solicitors:
N R Harding & N Christopher, P O Box 22, Eltham 4353.  Fax: [phone]

AWM Britton and J Gurnick, Crown Solicitors, P O Box 738, New Plymouth 4340. Fax: [phone]

LINSELL V MINISTRY OF SOCIAL DEVELOPMENT HC NWP CRI 2009-443-000029  18 December 2009

The Appeal

[1]      The appellant pleaded guilty to four charges involving social welfare benefit fraud.  Two charges were laid under s 127(a) of the Social Security Act 1964 which carried  a  maximum  penalty  of  12  months  imprisonment.   The  other  two  charges, carrying a maximum term of seven years imprisonment, were laid under ss 257(1) of the  Crimes  Act  1961  (using  a  forged  document)  and  228  (using  a  document  for pecuniary advantage).

[2]      On 11 November 2009 in  the  Hawera  District  Court  Judge  A  C  Roberts sentenced the appellant to eight months imprisonment.  The Judge refused to impose

a home detention sentence.

[3]      The  appeal  challenges  that  sentence  on  the  grounds  that  it  is  manifestly excessive.  The appellant’s counsel submits that the 8 month term should be reduced substantially.  Counsel’s preferred option is the substitution of home detention.

The Offending

[4]      The  benefit  fraud  involved is  all  to  prevalent. The appellant, as a single parent, was granted a Domestic Purposes Benefit and an Accommodation Supplement in November 2005. For a period of 14 months (January 2008 to March

2009) she was living in a de facto relationship which disentitled her to that benefit.

As a result she  was overpaid  $19,280. One charge  under  the  Social  Security Act related to her failure to inform the Department of her change in circumstances.   In June 2008 she submitted a letter (which appears to have been forged by her partner) purporting  to  verify  accommodation  costs. The  letter  contained  false  details. In August  2008  she  told  a  departmental  investigator  (the  inference  being  that  her domestic  arrangements  were  being  scrutinised)  that  she  was  not  in  a  de  facto relationship.   In October 2008 she completed a WINZ review application renewing her claim to her benefit.

[5]      The appellant pleaded guilty to all four charges at an early opportunity, being her first court appearance in Hawera to where the informations had been transferred from the Tuaranga District Court.

Relevant Personal Circumstances

[6]      The appellant’s only explanation for her offending was that continuing on the Domestic Purposes Benefit was the best thing she could do for her children.  At that time she had responsibilities for her own child, a child of her partner, and one, or possibly two, foster children.  Her partner apparently had considerable debts and was of little use as a form of financial support.

[7]      The appellant was aged 34.  She had previous brushes with the criminal law. There was a minor theft conviction in 1996.   She had, however, accumulated four breath alcohol convictions.   On 30 April 2008 she was sentenced in the Whakatane District Court to three months home detention as a result of her fourth offence.  This community based  sentence  was  imposed  on  her  midway through  her  benefit  fraud offending. This   factor   weighed   with   the   Judge,   although   he   had   incorrect information  about  the  start  date  of  the  home  detention  sentence.   One  of  the  four counts she faced was committed whilst she was serving that sentence.

[8]           At  the  appeal  hearing  Mr  Harding  raised  an  issue  which  was  not  placed before the Judge, and indeed was not the subject of any evidence.  On Mr Harding’s instructions, throughout 2008 the appellant was responsible for two foster children. Had she claimed (which she did not) available subsidies and allowances in respect of the foster children, then arguably the appellant’s legitimate entitlement would have been  in  the  region  of  $22,200  over  the  14  month  period,  a  figure  approximately $2,000 in excess of the benefit overpayment.

[9]      There is a dictum of Robertson J in Ioane v Department of Social Welfare (1994) 11 CRNZ 489, 491 which suggests that a sentencing court might focus on the difference between the sum received as a result of criminal behaviour and the sum to which the offender had an entitlement to in any event. Such an approach might have

a useful purpose when a sentencing court is weighing the net loss to the taxpayer.  It

can hardly be regarded as an exculpatory factor, particularly in a situation where, as here, the offender knew her conduct was unlawful.

[10]     I determined, and counsel accepted, that no useful purpose would be served

by  adjourning  the  appeal  to  enable  affidavit  evidence  of  the  appellant’s  lawful entitlements being placed before the Court.

The Sentence

[11]     The Judge was not helped by erroneous information placed before him about the appellant’s criminal record. Counsel had similar difficulties on the appeal. As a result the Judge stated that the appellant had been sentenced to home detention for three months in December 2007. He saw this as a relevant consideration because the offending occurred when the appellant was subject to that sentence. The impression

I gained from the Judge’s sentencing notes was that he was concerned (as was I) that the appellant had embarked on her offending within a month of being sentenced to home detention.   In  fact  the home detention sentence  was not imposed  until April 2008.

[12]     The home detention sentence loomed large.   The author of the pre-sentence report had not considered the home detention option nor had the normal Appendix been prepared.  The Judge summarised thus:

[7]      The  issue  of  electronically  monitored  process  was  not  developed given  the  fact  that  you  were  offending  whilst  or  subject  to  an  earlier  like sentence.  The comment was you were not deterred.

[13]     Mr   Harding,   who   was   counsel   in   the   District   Court,   appears   to   have submitted at length that an appendix should be prepared and that home detention was the   appropriate   sentence.  The   Judge,   before   embarking   on   his   sentencing methodology, said:

[10]     I  had  indicated  that  I  was  not  prepared  to  defer  sentencing  and  I would not have, even if it were available to me, considered home detention appropriate.   I have no doubt, given the fact that on an earlier occasion the Department was satisfied an existing opportunity was available that I would ultimately  be  presented  with  the  fact  that  yes,  while  it  is  available,  the

reservation  and  question  mark  as  to  your  stepping  back  from  further offending still remains.

[14]     In Mr Harding’s submission, this approach was wrong.  Instead of turning his mind  to  the  home  detention  discretion  as  required  by  ss 15A  and  80A  of  the Sentencing Act 2002 once a short sentence had been arrived at, the Judge effectively cut  home  detention  off  at  the  pass.   Even  on  appeal  Mr  Harding  submitted  that  I should  structure  my  appeal  judgment  in  such  a  way  to  allow  the  appellant  to  be released on home detention once a suitable address became available (s 80J).

[15]     At  a  technical  level  Mr  Harding  is  correct.   There  is  no  rule  of  law  to  the effect  that  offending  whilst  subject  to  home  detention  or  some  other  community based  sentence  is  a  total  bar  to  that  offending  being  visited  by  a  home  detention sentence.

[16]     It is not unknown for benefit fraud cases to be met with a home detention sentence. Indeed that was the outcome in the cluster of appellants set out in the High Court judgment of Hogan v Ministry of Social Development (HC NAP CRI 2005-

441-24,  22  July 2005).   On  the  facts  of  this  case  the  three  month  home  detention period sat midway through offending which spanned 14 months. Certainly offending whilst on home detention is highly relevant to the exercise of the s 15A(1) discretion. If a person whilst on home detention used the home as a tinnie house or

to cultivate cannabis, it would be idle to suggest that home detention should be re- imposed. But  this  case,  in  my  judgment,  was  qualitatively  different. The  Judge might well, for sound reason, have exercised his discretion against home detention. The responsibility for doing so was his, not the probation officer’s.  I have no doubt that in a busy sentencing court the Judge may well have legitimately, and in advance, decided that his discretion would not be exercised.   But it would, with respect, be preferable if he had expressed that view once he had reached a short sentence rather than before he had embarked on the traditional sentencing methodology.

[17]     The Judge then turned to crafting his sentence. He noted the offending spanned 14  months. He referred to the “plain and simple truth” of benefit fraud being  “a an epidemic level”. He referred  to Hogan. He  saw  the  offending  (and correctly  so),  as  not  being  one  instance  but  “practised  and  accomplished”. He

referred to the principles of denunciation and deterrence.  The Judge then fixed on a start  point  of  nine  months.  He  did  that,  not  because  he  necessarily  saw  it  as reflecting  the  appellant’s  culpability,  but  because,  on  the  basis  of  Hogan,  an appropriate end sentence of six months would have required a nine month start point.

[18]     As the Court of Appeal observed in R v Hapuku [2007] NZCA 368 at [13]:

There  is  little  to  be  gained  from  comparing  and  contrasting  fraudulently obtained sums or the duration of the offending in cases of this type. Those are but two of the many relevant factors a sentencing court  must  weigh. Other  aggravating  features  and  the  personal  circumstances  of  the  offender must  be  considered.   What  is  required  of  a  sentencing court  is  a  carefully exercised discretion, bringing into play the provisions of the Sentencing Act 2002 relevant to the circumstances before it.

[19]     Having  arrived  at  a  nine  month  start  point  via  the  Hogan  route,  the  Judge then  turned,  as  R  v  Taueki  [2005] 3 NZLR 372 obliged him, to consider personal aggravating and mitigating factors. The Judge clearly regarded the prior home detention sentence as being a significant aggravating factor. This led him to apply a significant (33 1/3%) uplift. He said:

… I have determined that even on the nine months there must be a further elevation given the fact that that offending occurred at a time when society was entitled to believe that you would step back from offending.  It occurred at a time when you were subject to a sentence of home detention.   That is quite unacceptable.

[20]     The Judge uplifted his nine month start point for that reason to 12 months.

He then applied a third reduction to reflect the early guilty pleas, arriving at an end sentence of eight months imprisonment.

Decision

[21]     I have formed the clear view (against which Mr Britton candidly could not mount any submission) that the three month uplift to reflect the specified individual aggravating feature was excessive. The three month home detention sentence  the appellant was serving was imposed for totally unrelated offending and came in the middle of her 14 month benefit fraud offending.  I accept that the home detention sentence was relevant to the discretionary exercise required by the Sentencing Act of

considering whether a short term of imprisonment should be alleviated  by a home detention  sentence.  But  it  is  hard  to  see  how  any  significant  uplift  from  an appropriate start point could have been justified, let alone a one third uplift.

[22]     I consider the Judge was totally correct in fixing a nine month start point.  As mandated  by  Hapuku  (supra  [15])  the  Judge needed to assess  the  duration  of  the offending, the sum of money involved, and the appellant’s overall culpability. The appellant faced not one charge but four. Her offending embraced a deliberate and repeated deception including, it would seem, an individual inquiry in August 2008 which the appellant deflected by giving false information. Weighing   those circumstances, and in particular considering the need to deter and denounce benefit fraud, there can be no criticism of the Judge’s start point.  Anywhere within an eight to ten month band would have been unremarkable.

[23]     If  the  Judge  considered  the  offending  throughout  the  three  month  home detention period justified an uplift such uplift should not have exceeded one month, which would have produced an uplifted start point of ten months (or arguably nine months if there had been no uplift).

[24]     The Judge was totally correct, on the authority of R v Hessell [2009] NZCA

450,  to  allow  a  third  discount  for  the  guilty  pleas  which  were  entered  at  the  first available opportunity.

[25]     Had the start point remained at nine months then a six month end sentence would  have  resulted.  From  a  ten  month  start  point  the  discount  would  have produced an end sentence of approximately six months and two weeks.

[26]     Appellate courts should not, in my view, tinker with sentences. However, in this case it is the proportion which an excess in a sentence bears to the whole which must inform the difference between a sentence which is severe and a sentence which

is manifestly excessive.  The difference between eight months and six months (or ten months and six months two weeks) is in the order of 25%.

[27]     I  conclude  for  these  reasons,  the  end  sentence  of  eight  months  was  in  this case manifestly excessive.   It should be quashed and a sentence of six months and two weeks substituted.

[28]     I turn, as I must when dealing with a short sentence, and in a situation where the  Judge  perhaps  wrongly  thought  his  hands  were  tied,  to  whether  a  sentence  of home detention should be substituted.

[29]     In the exercise of that discretion I have concluded that imprisonment rather than home detention is the correct sentence. I have reached that view, not because the appellant was offending whilst subject to a home detention sentence. I give that minimal weight. Rather  I  have  concluded  that  the appellant has a history of  not knuckling down to community based sentences. She was convicted of driving whilst disqualified in 1996. She was further convicted of the same offence in November

2008, less than three months from the end of her home detention sentence imposed

for  her  fourth  offence  of  excess  breath  alcohol. I have additionally weighed  the purposes of denunciation and deterrence stipulated in s 7(1).  Those factors, added to

a discernible pattern to ignore Court imposed obligations whilst in the community, result  in  my  refusing,  like  Judge  Roberts  but  for  a  different  reason,  to  substitute home detention for the short sentence of imprisonment.

Result

[30]     The sentence of eight months imprisonment imposed in the Hawera District

Court on 11 November 2009 is quashed.

[31]     A sentence of six months and two weeks imprisonment is substituted.

……………………

Priestley J