Malapaka v Police
[2020] NZHC 1121
•26 May 2020
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CRI-2019-404-427
[2020] NZHC 1121
BETWEEN KRISHNA MALAPAKA
Appellant
AND
NEW ZEALAND POLICE
Respondent
Hearing: 25 May 2020 Appearances:
J Harder for Appellant
L N Wilson for Respondent
Judgment:
26 May 2020
JUDGMENT OF LANG J
[on appeal against refusal to grant discharge without conviction]
This judgment was delivered by me on 26 May 2020 at 3 pm.
Registrar/Deputy Registrar Date……………
Solicitors:
Crown Solicitor, Auckland Counsel:
J Harder, Barrister, Auckland
MALAPAKA v NEW ZEALAND POLICE [2020] NZHC 1121 [26 May 2020]
[1] Mr Malapaka pleaded guilty in the District Court to a representative charge of theft by a person in a special relationship.1 The maximum penalty for that offence is seven years imprisonment.
[2] On 17 September 2019, Judge J C Down declined an application by Mr Malapaka to be discharged without conviction under s 106 of the Sentencing Act 2002.2 Mr Malapaka appeals against that decision.
The offending
[3] Mr Malapaka pleaded guilty on the basis of two summaries of agreed fact. These recorded that the offending occurred whilst Mr Malapaka was employed as a loan officer for a credit union. The credit union offers banking and financial services to its members.
[4] On 19 occasions between 12 January 2018 and 19 February 2019 Mr Malapaka used an automated teller machine (ATM) to withdraw cash from members’ accounts. Each withdrawal was for amounts between $200 and $400. On one occasion he was responsible for processing an application by a member for a loan of approximately
$1,000. He altered the application so that it sought a loan of $1,653. He then transferred the amount of the loan to the member’s account but then withdrew the sum of $600 from an ATM. In total Mr Malapaka stole $5,200 from members in this way.
[5] The credit union refunded members the amounts that Mr Malapaka had taken from their accounts. He subsequently reimbursed the credit union in full for these sums.
[6] When the police spoke to Mr Malapaka about his offending he said his mother had been injured in an automobile accident in India and that he had stolen the money to pay for their medical treatment. In an affidavit filed in support of the present application he also said he had suffered a recurrence of an old injury to his spine and the medical costs needed to treat this were not covered by ACC. Both of these matters placed him under significant financial pressure and led to his offending.
1 Crimes Act 1961, s 220.
2 New Zealand Police v Malapaka [2019] NZDC 26415.
Relevant principles
[7] An application for discharge without conviction is governed by s 106 of the Act, which relevantly provides as follows:
106 Discharge without conviction
(1) If a person who is charged with an offence is found guilty or pleads guilty, the court may discharge the offender without conviction, unless by any enactment applicable to the offence the court is required to impose a minimum sentence.
…
[8] In applying s 106, the Court must follow the guidance contained in s 107 of the Act. This provides:
107 Guidance for discharge without conviction
The court must not discharge an offender without conviction unless the court is satisfied that the direct and indirect consequences of a conviction would be out of all proportion to the gravity of the offence.
[9] A court considering an application for discharge under s 106 must consider three issues.3 It must first assess the gravity of the offending having regard to the facts of the particular case. This exercise is not restricted to the aggravating and mitigating factors of the offending itself. Factors personal to the offender may also be relevant.4 Next, it must identify the direct and indirect consequences of a conviction being entered. In this context there must be a “real and appreciable” risk that any posited consequence will occur.5 Thirdly, the court must determine whether the consequences of a conviction would be out of all proportion to the gravity of the offending. There is a residual discretion not to grant a discharge but that will rarely be exercised where the statutory criteria have been met.
[10] An appellate court is required to reach its own view as to whether the direct and indirect consequences are out of all proportion to the gravity of the offending. If it accepts the statutory threshold has been met, the court must determine whether the
3 R v Hughes [2008] NZCA 546, [2009] 3 NZLR 222 at [16] to [17].
4 Z (CA447/2012) v R [2012] NZCA 599, [2013] NZAR 142 at [27]; DC (CA47/2013) v R [2013]
NZCA 255 at [35].
5 DC (CA47/2013) v R, above n 4, at [43].
court at first instance erred in principle when exercising its discretion go grant or refuse to grant a discharge.
The Judge’s decision
[11] The Judge assessed the gravity of Mr Malapaka’s offending as being moderately serious without taking into account mitigating factors.6 These included previous good character, his early guilty plea and the fact that Mr Malapaka had repaid all of the money he had stolen. These factors reduced the overall gravity of the offending to a point where it was “towards the lower end of moderately serious”.7
[12] Turning to the likely consequences of the conviction, the Judge accepted Mr Malapaka was liable for deportation, but this did not mean he would ultimately be deported. The Minister of Immigration still has the ability to cancel the deportation order if he or she thinks fit. The essence of the Judge’s decision declining to grant Mr Malapaka a discharge without conviction is contained in the following paragraphs of his decision:8
[30] I am not satisfied that this [deportation] will be devastating to other members of your family. If you return to your home country you will take with you the skills and experience that you have gained in New Zealand, and I have no doubt that you will be able to successfully work in India and support your family.
[31] You would prefer to stay in New Zealand, and I understand that. It is a wonderful country to live in. But you have breached the trust that has been placed in you, not only by your employer but also by the people of New Zealand; I am afraid that the normal and natural consequences of conviction should apply here.
[32] I have concluded that the offending is so serious that the consequences of conviction for you, although serious, do not far outweigh the gravity of the offending. Yes, the consequences may be serious, and by carrying out a fine balancing exercise, it may be that that would go in your favour, but that is not the test that I must apply under s 107. The consequences must be wholly disproportionate to the gravity of the offending, and I do not find that that is the case here. Therefore, I am going to enter a conviction.
6 New Zealand Police v Malapaka, above n 2, at [13] and [27].
7 At [14] and [28].
8 New Zealand Police v Malapaka, above n 2.
The arguments
[13] On Mr Malapaka’s behalf Mr Harder argues the Judge erred in several respects in reaching his decision. First, he submits the Judge overstated the overall gravity of Mr Malapaka’s offending by double-counting the aggravating factor of breach of trust and concluding the overall gravity was moderate to serious. Mr Harder submits the overall culpability of the offending must be regarded as low to moderate once mitigating factors are taken into account.
[14] Mr Harder also contends the Judge erred in reaching conclusions about Mr Malapaka’s future employment prospects if he is returned to India. Mr Harder submits there was no evidence on which the Judge could reach conclusions regarding Mr Malapaka’s likely employment prospects if he is deported to India.
[15] Finally, Mr Harder submits the Judge failed to take into account the effects on India’s economy as a result of the current Covid-19 pandemic. He says this issue ought to have been factored into the equation in assessing the overall consequences of a conviction followed by deportation.
[16] For the Crown, Ms Wilson contends the Judge correctly categorised the gravity of the offending as being moderate to serious. She says the Judge was entitled to conclude the overall consequences of the conviction, including possible deportation, were not out of all proportion to the overall gravity of the offending. She therefore says the Judge did not err and the appeal should be dismissed.
Decision
Gravity of the offending
[17] Mr Malapaka’s offending had several aggravating factors. First, it was not a “one-off” event occasioned by a lack of judgement. Rather, it continued over a period of more than five weeks and involved 19 separate transactions. This means it was calculated and premeditated offending.
[18] Secondly, the offending involved a degree of sophistication because Mr Malapaka obviously used his position as an employee of the credit union to devise
a means by which he could gain regular access to members’ accounts. This would ordinarily involve the use of a password or PIN known only to the owners of the accounts. The offending involving the forgery of a member’s loan application added another dimension to his offending.
[19] Thirdly, although the total amount stolen was not substantial it was nevertheless still significant.
[20] Fourthly, I do not accept Mr Harder’s submission that the fact that the offending involved a breach of trust was wholly subsumed in the nature of the charge. Mr Malapaka was trusted not only by the credit union’s customers but also by his employer and fellow employees. All were entitled to expect he would not abuse his position for personal gain but he betrayed that trust.
[21] Furthermore, I do not accept Mr Harder’s principal submission in this context, which was that the Judge placed too much emphasis on the vulnerability of the victims. Mr Harder based this submission largely on the following passage from the Judge’s decision:9
[25] I have read a victim impact statement prepared by Rob Collins. He is the general manager of [a credit union in] Auckland, a credit union that has been operating for over 50 years. he says this:
Our members are predominantly Pasifika/Maori, low income wage earners or beneficiaries. Many of our members cannot or find it difficult to obtain financial services from High Street banks. Consequently, without our help they are often prey to loan sharks, retail trucks and scammers. Our promise to them has bene that we will do better than the rest of the banking/financial services sector. Consequently, the offending by Krishna Malapaka has been devastating for our directors and staff, who feel betrayed. He joined the Credit Union in October 2018 in a position of trust. Most staff saw him as a mentor over this time, but he used this to gain the knowledge and ability to surreptitiously access members’ savings accounts, and falsify a loan in order to steal from them. Not only were these members least financially able to withstand a loss by these actions, but it was deliberate and calculated deception that broke the very core of the relationship we have with our members.
…
9 New Zealand Police v Malapaka, above n 2.
[27] I have come to the conclusion that this offending is moderately serious. A breach of trust in stealing from an employer is always dealt with as serious. Where it impacts upon the customers of that company in a way as directly as this did, and had the potential to be devastating to them. This is at the very highest end of moderately serious in my view, albeit that the sum is much less than in other cases that have been stated to me. $5000 is a significant amount of money, particularly if one takes it in the context of those from whom the money was stolen.
[22] Mr Harder points out that the members whose money was stolen were never aware of that fact because the credit union repaid the funds as soon as it discovered the theft. This submission overlooks the point that Mr Malapaka had no knowledge when he stole the funds that his employer would immediately take steps to ensure members suffered no loss. He knew he was stealing money from members and that they were the persons who stood directly to lose from his actions. He must also have known that many of the persons from whom he stole money could not afford to lose it.
[23] Taking these factors into account I consider the Judge was correct to categorise the gravity of the offending as being at the upper end of moderate to serious before considering the mitigating factors on which Mr Malapaka could rely.
[24] As I have already observed, mitigating factors included Mr Malapaka’s early guilty pleas, his previous good character and the fact that he refunded the amount he had stolen in full. In addition, Mr Malapaka completed more than 370 hours of voluntary community work before he was sentenced. I therefore accept Mr Harder’s submission that Mr Malapaka had done all he could realistically do to atone for his offending after it was discovered. I do not accept, however, that these factors reduced the overall gravity of the offending to the point where it could be described as low to moderate. Rather, I would categorise it as being at the lower end of moderate to serious.
The consequences of conviction
[25] Mr Harder relies on two consequences that he says are likely to follow if Mr Malapaka is convicted of the charge. First, a conviction is likely to have a significant effect on Mr Malapaka’s future employment prospects wherever he may
be. Secondly, it is likely to result in his deportation back to India and this will have a major impact on his ability to provide for his wider family.
[26] The obvious point to be made in response to Mr Harder’s first submission is that future employers are entitled to know Mr Malapaka has been convicted of this offending because it clearly raises an issue regarding his honesty and integrity. In particular, it suggests he is not a person who can be trusted to have access to funds belonging to other people. This is not a consequence that is unique to Mr Malapaka. Any person convicted of this type of offending is likely to encounter difficulty in finding future employment in a field where an element of trust is required. That outcome is a natural consequence of this type of offending.
[27] As the Judge recognised, there must also be a considerable risk Mr Malapaka will be deported as a result of his conviction. Until September 2019 he held a resident class visa but was required to obtain a permanent resident visa at that point to remain in New Zealand and be able to travel. Under s 16(1)(b) of the Immigration Act 2009 Mr Malapaka is liable for deportation if he commits an offence for which the maximum penalty is two years imprisonment or more. A conviction on the present charge will therefore render him liable to deportation.
[28] Mr Malapaka has the ability to appeal to the Immigration and Protection Tribunal but the grounds for appeal are limited. Mr Malapaka will be required to establish exceptional circumstances of a humanitarian nature that make it unjust or unduly harsh for him to be deported to India.10 This is a high threshold and the fact that Mr Malapaka has no other dependent members of his family in this country means it is unlikely an appeal will succeed.
[29] Although the Minister of Immigration has the discretion to cancel or suspend a deportation liability notice this there are no obvious reasons why the Minister would take that step in Mr Malapaka’s case. Like the Judge, I therefore accept the prospect of deportation is very real.
10 Immigration Act 2009, s 207.
[30] Mr Malapaka deposes that if he is returned to India he will not be able to obtain employment that enables him to care for members of his wider family as he currently does. He will also be required to re-integrate into a society with which he has had little recent association and in which his qualifications will carry little weight.
[31] I accept Mr Harder’s submission that there was no evidential basis for the Judge to be sure Mr Malapaka will be able to work in India and support his family. On the other hand, Mr Malapaka has provided no evidence to support his assertion that he will not be able to find any form of work if he is deported to India. During his time in New Zealand he has worked in a variety of occupations. He is currently working in a call centre. The Court is not required to accept uncritically his assertion that he will not be able to find work if he is returned to India. He has succeeded in finding several types of employment during his time in New Zealand and, other than the limiting factor of the present conviction, there is no reason to believe he will not be able to do the same in India.
[32] It is difficult to assess the weight to be given to Mr Harder’s final submission based on the effect of the COVID-19 pandemic on India because the only evidence he has provided is a global report by the World Health Organisation dated 14 May 2020. A diagram attached to the report indicates India reported between 10,000 and 100,000 new cases within the seven days preceding the report. A table attached to the report states that to date India has reported a total of 74,281 confirmed cases of persons infected with COVID-19 and 2,415 deaths from the virus.
[33] Without more, however, these figures are of little assistance for present purposes. Mr Malapaka has not said where he would live if he was deported to India and the report does not report the number of confirmed cases or deaths on a regional basis. It is therefore impossible to assess the likely impact of the pandemic on Mr Malapaka if he was deported to India. In any event I consider this to be an issue for the immigration authorities to assess on a case by case basis when considering whether and when to deport persons from New Zealand. It is logical to assume this country is not currently deporting persons to any region where the pandemic is not yet under control.
[34] Taking these factors into account I would assess the likely consequences of conviction to be in the mid-range of moderate to serious.
Are the consequences of a conviction out of all proportion to the overall gravity of the offending?
[35] I have found the overall gravity of the offending to be at the lower end of moderate to serious and have assessed the likely consequences of a conviction as being in the mid-range of moderate to serious. The consequences are therefore slightly disproportionate to the overall gravity of the offending.
[36] I therefore find myself in the same position as the Judge. As the Judge observed, on the balance of probabilities Mr Malapaka would have succeeded in showing the consequences were disproportionate to the gravity of the offending.11 But that is not the statutory test. Section 107 prohibits the Court from discharging an offender without conviction unless the consequences of a conviction are out of all proportion to the overall gravity of the offending. The disconnect between the consequences and the gravity of the offending in the present case is not sufficient to meet that test. I am therefore satisfied the Judge had no option but to decline Mr Malapaka’s application and enter a conviction.
Result
[37]The appeal against refusal to grant a discharge without conviction is dismissed.
Lang J
11 New Zealand Police v Malapaka, above n 2, at [32] (set out above at [12]).