Lu v New Zealand Customs Service

[2020] NZHC 7

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE

CRI-2019-404-000514

[2020] NZHC 7

BETWEEN

XU LU, YANG YU and HUI ZHAO

Appellants

AND

NEW ZEALAND CUSTOMS SERVICE

Respondent

Hearing:

13 December 2019

Appearances:

S Withers for the Appellants

A Al-Janabi for the Respondent

Judgment:

13 January 2020

JUDGMENT OF MOORE J

[Appeal against refusal to grant interim name suppression]

This judgment was delivered by me on 13 January 2020 at 11:30 am

Registrar/ Deputy Registrar Date:

LU& ORS v NEW ZEALAND CUSTOMS SERVICE [2020] NZHC 7 [13 January 2020]

Introduction

[1]    Hui Zhao, Lu Xu and Yang Yu face charges of defrauding Customs revenue.1 All three are employed by an airline company. It is alleged that on 11 occasions between 7 June 2018 and 11 April 2019 they smuggled cigarettes into the country without paying the requisite excise duty. This is said to total some $3,500.

[2]    The appellants were granted interim name suppression at their first appearance. On 29 November 2019, Judge J C Moses in the Papakura District Court refused to continue that name suppression.2

[3]The defendants now appeal.

The Judge’s decision

[4]    Before Judge Moses it was said that the charges would be resolved by way of a financial penalty and that the defendants would then apply for a discharge without conviction. Publication of their names would thus negate any resulting benefit.

[5]    But the Judge was not satisfied the threshold for extreme hardship was met. He said:

“[8] I have no affidavits from any of the defendants put  before  me… Clearly the investigation has been ongoing and has caused stress and strain to the defendants. Two have been on unpaid leave and one has been on restricted duties. Their employer is however already well aware of the allegations, so in terms of the hardships that could be caused by their employer finding out there is simply no basis for that.”

[6]    Judge Moses took the view that the appellants’ concerns were aimed at the result of conviction rather than publication. He denied them name suppression.

1      Customs and Excise Act 2018, s 371(1)(a) and (4); the maximum penalty is five years’ imprisonment and/or a fine of $20,000. Some of the charges are brought under this provision’s predecessor, s 211(1)(a) and (3) of the Customs and Excise Act 1996, which has a maximum penalty of six months’ imprisonment and/or a fine of $20,000.

2      R v Lu [2019] NZDC 24269. Judge Moses granted interim name suppression to the airline until the disposition of the charges. I will therefore not specify which airline the defendants worked for so as not to undercut that order.

Submissions

[7]    Mr Withers, for the appellants, confirms that the matter will resolve with the likely result being a fine. He says that publication of the appellants’ names will cause them extreme hardship, as well as the airline. In support, he has filed an affidavit dated 26 November 2019 from the airline’s general manager. While this document mostly deals with the airline’s application for name suppression, which is not at issue for reasons discussed later, it does touch on the appellant’s position in the following ways:

(a)if the appellants plead or are found guilty, the airline will commence an internal employment investigation; and

(b)if the charges are proved the appellants will be in breach of their employment obligations.

[8]    At the hearing of this appeal Mr Withers sought to file a second affidavit from the airline’s general manager dated 13 December 2019. This is discussed more fully below but it is claimed that if the appellants are convicted it is likely that their employer will not be able to continue to employ them in their current positions. The affidavit goes further. The deponent says that any conviction would possibly mean a “death sentence” on their engineering careers as it is understood that they would not be able to secure any visa to legally work in any other country.

[9]    The balance of the affidavit is devoted to the respective positions of the appellants in the event convictions were entered.

[10]   Further Mr Withers suggests that, in the event of publication, the airline would “have no choice” but to terminate the defendants’ employment in order to distance itself from them in the public perception. Given the “trivial” nature offending, this would constitute extreme hardship, particularly given the proceedings against the defendants have already been subject to several delays.

Approach to appeal

[11]   Name suppression is governed by s 200 of the Criminal Procedure Act 2011 (“the CPA”). A person applying for name suppression must satisfy a two-stage test:3

(a)first, the Court must be satisfied that publication would be likely to lead to one of the grounds listed in s 200(2); and

(b)if so, the Court must further be satisfied that is appropriate to exercise its discretion to grant name suppression, taking into account the competing interests of the applicant and the public.

[12]   If, as is the case here, a s 200 appeal relates to the first step of the application, the principles applicable to a general appeal apply;4 that is to say, the approach laid down in Austin, Nichols & Co Inc v Stichting Lodestar is followed.5 The appeal is to be heard afresh, and with the appellate Court entitled to form its own view of the merits.

Discussion

[13]   The Court may suppress a defendant’s name if satisfied that publication would be likely to cause extreme hardship to him, her or any connected person.6 Extreme hardship is a high hurdle.7 It must involve something beyond the ordinary consequences of conviction.8

[14]   I am satisfied that publication of the defendants’ names would not cause extreme hardship to either them or the airline. The appeal must therefore fail. My reasons follow.

3      Criminal Procedure Act 2011, s 200(1) and (2); see also Fagan v Serious Fraud Office [2013] NZCA 367 at [9] and Robertson v Police [2015] NZCA 7 at [40]-[41].

4      Shepherd v Police [2018] NZHC 1167 at [36]-[37].

5      Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141.

6      Criminal Procedure Act 2011, s 200(1) and (2)(a).

7      Robertson v Police at [48].

8 At [49].

[15]   Mr Withers asks that the general manager’s second affidavit be admitted as evidence on this appeal. Ms Al-Janabi, for New Zealand Customs Service, opposes its admission. She submits that the evidence is not fresh and, in any event, none of its contents will assist the Court.

[16]   I agree. The material contained in this affidavit could, had it been considered relevant, have been admitted at the first instance hearing. No explanation is given as to why that did not happen. For that reason I am satisfied the evidence should not be admitted.

[17]   However, in any event, the proposed evidence adds little to the evidence already filed. All it says is that in the event of a conviction the employment status of the appellants would be at risk. For reasons developed below, I am not satisfied that is a relevant consideration on an appeal against the refusal to grant name suppression. And it is to that point I next turn.

[18]   The concerns identified by Mr Withers and the general manager’s evidence arise from conviction, not publication. It is true the defendants may face disciplinary action from their employer. They may even lose their employment. But as the airline’s general manager makes clear in his affidavits, this depends on whether they are convicted of the offending rather than if their names are published. For example, the following excerpt is from the general manager’s first affidavit:

“14. If the Defendants plead guilty or are found guilty, the Applicant will commence internal employment investigation under their employment agreements.

…

20. The Applicant takes any wrongdoing by its  employees  seriously because it has an overall duty of care to its passengers. The allegations of offending are taken seriously by the Applicant as the Defendants used the Applicant's aircraft as a medium to facilitate their offending without the Applicant's knowledge. If the Defendants have done so then they are in breach of their employment contractual obligations to the Applicant.”

[19]   Questions of proportionality between the consequences of conviction and the offending are matters for the sentencing Judge. They are not engaged on an appeal against a refusal to name suppression although I accept there are some parallels.

[20]   Further, while it seems the defendants may be investigated, there is no guarantee they will lose their jobs if convicted of the offending. None of the appellants has made an affidavit deposing to why or how name suppression will cause extreme hardship. There is no suggestion that they might suffer extreme hardship as a result of publication.

[21]   In respect of the airline, I accept that it might suffer minor reputational damage if the defendants’ names were published and the general public made the connection. But this does not approach the threshold of extreme hardship. Further, I am not in a position to revoke the interim name suppression order made by the Judge in respect of the airline. It remains in force for the moment. It will thus be difficult to make any connection between the airline and the appellants. Thus the fears expressed by the general manager are illusory.

[22]   Finally, as Mr Withers himself pointed out, the alleged offending is entirely trivial. But for the making of this application I struggled to see how it might generate any interest in the media. But that has changed. Representatives of Stuff Limited (Catrin Owen) and NZME (Mr Hurley) were present in Court. But even if stories are published, I cannot see how this would constitute extreme hardship for any of the parties involved. It simply does not meet that test given the high threshold. In my view publication does not take the level of hardship beyond the ordinary consequences of conviction even if that was to follow. For these reasons I agree with Judge Moses.

Result

[23]The appeal is dismissed.

Moore J

Solicitors:

Mr Withers, Auckland Crown Solicitor, Manukau