Mehmood v R
[2015] NZCA 338
•29 July 2015 at 10.30 am
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA657/2014 [2015] NZCA 338 |
| BETWEEN | KHALID MEHMOOD |
| AND | THE QUEEN |
| Hearing: | 7 July 2015 |
Court: | White, Keane and Kós JJ |
Counsel: | J G Krebs for Appellant |
Judgment: | 29 July 2015 at 10.30 am |
JUDGMENT OF THE COURT
The appeal against sentence is dismissed.
____________________________________________________________________
REASONS OF THE COURT
(Given by Keane J)
On 15 October 2014, in the Manukau District Court, Khalid Mehmood was sentenced to imprisonment for three years for three offences against the Tax Administration Act 1994, after pleading guilty to those offences on the basis of an agreed statement of facts.[1]
[1]Inland Revenue Department v Mehmood DC Manukau CRI-2012-092-13008, 15 October 2014.
Over five and a half years, between 31 October 2005–4 November 2010, Mr Mehmood filed 144 false returns, on behalf of a company of which he was the principal, Areeb Khan Foods Ltd, understating its liability to income tax, PAYE and GST. The core tax evaded was in excess of $1 million. On sentence the total arrears, including statutory interest and penalties, were in the vicinity of $3.4 million.
On this appeal against his sentence Mr Mehmood initially contended that Judge G T Winter took an excessively high starting point, four years. He has not pursued that ground of appeal, but continues to assert that it was unduly severe, in order to buttress the first ground of appeal that he does pursue.
Mr Mehmood’s first appeal ground is that the three month discount the Judge gave him for his previous good character and for his fragile depressive state, and the 15 per cent discount the Judge gave him for his plea, were both manifestly inadequate. As to each, he contends, the Judge failed to take into account how pervasive his state of depression was when he offended and, after he was charged, while he considered his plea.
Mr Mehmood contends, secondly, that his sentence is manifestly excessive because, even if it were normally otherwise appropriate, which he does not concede, it is in his case disproportionately severe.[2] Imprisonment, he contends, prevents him from complying with his daily duties as a practising Muslim; a particular hardship not suffered by sentenced prisoners generally.
[2]Sentencing Act 2002, s 8(h).
This second ground of appeal is retrospective. On sentence Mr Mehmood did not seek such a discount. Nor was it foreshadowed in the materials before the Judge. In his notice of appeal, filed 11 November 2014, furthermore, Mr Mehmood identified his religion as a source of particular hardship on sentence as a relevant cultural and personal factor, not then as a ground of appeal. His concern then was also more confined. It was that he could not obtain in prison the diet his religion prescribes.
In the affidavit evidence he has filed on this appeal, Mr Mehmood now contends that his circumstances in custody deprive him more widely of his ability to comply with his religious duties daily. He has not been able to pray in a quiet and undefiled place; to wash before and after praying, and at the other times his religion prescribes; to have access to an imam, and to comply fully with Ramadhan, a month of fasting each year.
In affidavits in response three officers, who have been responsible for administering Mr Mehmood’s sentence, contest his account. Two from the Northland facility, where to this point he has served most of his sentence, say that he did not express any of these concerns until April 2015, when he filed his initial affidavit evidence on this appeal; a response which Mr Mehmood disputes.
The third officer, who is now responsible for administering Mr Mehmood’s sentence at the South Auckland facility in Manukau, where he will complete it, says that Mr Mehmood is largely, if not completely, able to comply with his daily religious duties; and Mr Mehmood does not appear to contest that as actively.
Sentencing materials
According to the materials on sentence before the Judge, Mr Mehmood came to New Zealand in 1996, aged 26, after he and his family had been forced to leave Afghanistan, then in a state of civil war, where his father had been an Air Force officer.
Mr Mehmood had, he says, a degree in physics, but was only able to find work in restaurants. Despite that, he proved to be a successful restaurateur. Trading through his company, Areeb Khan Foods Ltd, he acquired the three restaurants that became the source of his offending. He retained and understated cash earnings. He employed 23 staff, paid them partly in cash, and understated their wages.
On 18 February 2011 the Inland Revenue Department (the IRD) executed search warrants at Mr Mehmood’s home and restaurants. They obtained Mr Mehmood’s diaries recording his actual sales and his employees’ actual wages. On 24 September 2012 Mr Mehmood was charged, as a party to his company’s offending, with filing 144 false income tax, PAYE and GST returns.
In 2006, soon after he began to offend, Mr Mehmood had married. He and his wife, who comes from Pakistan, have two young children. On 3 October 2012 they entered into a relationship property agreement. On 7 October 2012 she took their children to Pakistan, where she and they remain. In issue at that time, and on sentence, was whether their separation was genuine or was a device.
After the IRD search in February 2011 Mr Mehmood settled trusts and incorporated companies to which funds were transferred. Then on 4–5 October 2012, just before his wife and children left for Pakistan, two sums totalling $700,000 were transferred to a Pakistan bank account held by Mr Mehmood’s sister’s husband.
At the time of sentence the Crown was, apparently, pursuing those payments in a separate proceeding, which Mr Mehmood was contesting. On sentence the Crown contended that Mr Mehmood was responsible for those payments to the prejudice of the IRD and that this aggravated his offending. That was an issue the Judge had to resolve.
An equally significant issue on sentence was Mr Mehmood’s then mental and emotional state. In October 2012, soon after he was charged, Mr Mehmood disclosed that he had attempted suicide and that led the IRD to have him assessed psychiatrically to assess his fitness to stand trial and whether that carried any heightened risk of suicide.
On 21 March 2013 the psychiatrist engaged could not predict accurately what Mr Mehmood’s risk of suicide might be, but said that, if he went to trial, his depressive state was likely to worsen. Six months later a second psychiatrist, engaged by Mr Mehmood’s then counsel, said that his condition had deteriorated and that he might be at higher risk.
On 21 January 2014 Mr Mehmood applied for a stay, contending that his depressive state, which had been brought about, he said, by the investigation and prosecution he faced, handicapped him in the conduct of his defence and rendered any potential trial unfair. He also contended that his risk of suicide made any trial inhumane and inconsistent with the public interest.
On 2 April 2014 Judge Wilson QC declined that application, holding that, despite Mr Mehmood’s history of depressive illness, he remained fit to stand trial.[3] During the years in issue he had managed the three restaurants with advice as to his company’s liability to tax. On the Crown’s case, after he was investigated, he began actively to divest himself of assets and funds to frustrate the IRD. He remained able to instruct his counsel. The Crown case was strong. Any risk of suicide remained speculative. The trial was in the public interest.
[3]R v Mehmood DC Manukau CRI-2012-092-13008, 2 April 2014.
On 4 July 2014, soon after the indictment was filed, Mr Mehmood pleaded guilty to the three generic offences it alleged, which grouped into three the specific offences with which he had been charged originally. By his plea, therefore, he admitted all 144 offences. But because his mental and emotional state remained of concern, Community Corrections recommended that he be re-assessed.
That resulted in a psychological report, dated 8 September 2014, which confirmed that Mr Mehmood was still in a depressed state and might still be suicidal. At the time of sentence, as a letter before the Judge confirmed, furthermore, Mr Mehmood remained under the care of the Manukau Community Health Centre, on medication to counter a major depressive disorder diagnosed to be of moderate severity.
Mr Mehmood’s pre-sentence report, dated 15 September 2014, recorded that he still asserted his innocence and believed that he had been victimised by a business competitor, whose son was employed by the IRD. Despite that disclaimer, Mr Mehmood was assessed to have offended out of dishonesty and “a sense of entitlement”.
Mr Mehmood’s report recommended imprisonment and added that he did not consent to a sentence of home detention. He had, his report said, already attempted suicide using his car exhaust. He feared being confined within his own home. His mental health support worker confirmed that he was severely depressed and possibly suicidal. That being so, Mr Mehmood’s concern that he might harm himself was rated to be “very real”.
There was nothing in any of these materials concerning Mr Mehmood’s Muslim religion or his ability to comply with it in custody.
Starting point
Before coming to Mr Mehmood’s first ground of appeal as to the adequacy of the discounts he was given on sentence, we should first say that the four year starting point that the Judge took involved no error.
Mr Mehmood’s three offences each attracted a five year maximum sentence. In sentencing Mr Mehmood concurrently for those offences, the Judge was obliged to take a starting point reflecting all three. The four year starting point the Judge took for all three was one year less than the five year maximum sentence that each attracted.
That starting point, as the Judge said and we accept, was well justified by the scale of Mr Mehmood’s offending. Over five and a half years, by 144 offences, he defrauded the New Zealand public of $1 million in a calculated and systematic way and in gross breach of trust.
In setting that starting point, furthermore, the Judge rightly left out of account the aggravating feature urged by the Crown: that Mr Mehmood had acquired $1.4 million in assets and, relying on his property relationship property agreement with his wife, had transferred $700,000 to Pakistan. That, as the Judge said, was a disputed issue, the subject of a separate proceeding.
Finally, the Judge set the starting point having regard to the two relevant decisions of this Court, R v Easton,[4] and, more especially, Goh v Commissioner of Inland Revenue;[5] the latter of which he considered rightly to be similar to this case.
[4]R v Easton [2013] NZCA 677.
[5]Goh v Commissioner of Inland Revenue [2011] NZCA 344.
The issue whether the discounts he then gave were manifestly inadequate is quite distinct.
Discount for good character and depression
Mr Mehmood has not identified any error that would lead us to revisit the three month discount the Judge allowed him for his previous good character.
Mr Mehmood was not entitled to any discount for previous good character, or anything more than a nominal discount. He had exhausted any such entitlement by offending as persistently as he did, and on such a significant scale, over five and a half years.[6] Nor was he entitled to any significant discount for what the Judge described as his “depressive fragilities”; a state the Judge accepted that might have been in part attributable to his state of dislocation after he was forced, with his family, to leave Afghanistan.
[6]Tonga v R [2011] NZCA 257 at [24]; Allison v R [2013] NZCA 244 at [51].
The Judge was entitled, as he did, to treat as determinative that, despite Mr Mehmood’s state of depression, his offending had been “deliberate and premeditated”, together with his “spectacular lack of remorse” and his attempt to blame others. If anything, the discount the Judge allowed was generous.
Discount for plea
We are satisfied equally that the 15 per cent discount the Judge allowed Mr Mehmood involved no error of principle or discretion and was indeed generous.
The Judge assessed Mr Mehmood’s entitlement to a discount for plea, as Hessell v R requires, against all the circumstances in which he entered his plea; and in particular the extent to which, when he did so, he accepted responsibility for his offending.[7] That turned in part on whether he did actually concede he had offended, consistent with his plea. It turned also on what real choice he had as to whether to enter those pleas. A full 25 per cent credit, even for an early plea, may well not be justified where the Crown’s case is so strong that an offender has little choice.[8]
[7]Hessell v R [2010] NZSC 135, [2011] 1 NZLR 607 at [70].
[8]At [60].
There were three reasons why Mr Mehmood was not entitled to a full discount for plea:
(a)The charges were laid on 24 September 2012 and, as the Judge said, Mr Mehmood did not plead to them until 4 July 2014, almost two years later.
(b)That was so despite the fact, as the Judge said, that Mr Mehmood always faced a strong prosecution case, resting on a stark contrast between his revenue returns and his diaries setting out the actual state of his business.
(c)Further, as the Judge said also, despite Mr Mehmood’s plea on agreed facts, he never accepted responsibility for his offending and attempted to blame others.
The only reason why the Judge appears to have given Mr Mehmood more than a minimal discount for plea was on account of his depressive state. The 15 per cent the Judge allowed him was generous, more especially because, as the Judge said, he had intimated his plea in October 2013 and then applied for a stay.
Discount for disproportionate severity
The second issue on this appeal, whether assessed retrospectively Mr Mehmood’s sentence is disproportionately severe, has its basis in s 8(h) of the Sentencing Act 2002, which requires a sentencing Judge to:
take into account any particular circumstances of the offender that mean that a sentence … that would otherwise be appropriate would, in the particular instance, be disproportionately severe.
As this Court said in R v Luce, s 8(h) preserves the principle of mercy on sentence;[9] and, most typically, sentences have proved disproportionately severe when a sentenced prisoner has been in a state of extreme ill health, and sometimes has had very little time to live. In those exceptional cases discounts have ranged between 14–33 per cent.[10]
[9]R v Luce [2007] NZCA 476 at [23]; R v B (CA41/07) [2007] NZCA 292 at [55]–[57].
[10]Hastie v R [2011] NZCA 498 at [40].
Even then, however, as this Court also said in Luce, an inhibiting concern has always to be whether a discount for extreme ill health could be interpreted as a licence to offend and to avoid accountability; and no less relevant in those cases are the administrative remedies.[11] The Chief Executive is able to release a sentenced prisoner “for compassionate or humane treatment”.[12] The Parole Board may release a prisoner early if “seriously ill and unlikely to recover”.[13]
[11]R v Luce, above n 9, at [22]–[23].
[12]Corrections Act 2004, s 62(2)(a)(ii).
[13]Parole Act 2002, s 41(1)(b).
In the very rare cases, like this one, where a sentence of imprisonment is contended to be disproportionately severe for some other reason, to which the statutory remedies do not extend, everything turns on how exceptional the prisoner is, or his or her circumstances are, when compared with sentenced prisoners generally; and there are only two cases of which we are aware which bear any similarity to this.
In R v Abdulhussein, an appeal to this Court before the Sentencing Act 2002, an Iraqi refugee sentenced to imprisonment for 11 years for sexual violation by rape contended, amongst his grounds of appeal, that the Judge overstated his culpability by failing to take into account his “different cultural values, as they related to women” and, secondly, that he understated the undue burden he would suffer in custody “due to ethnic, language and dietary matters”, and, more especially because, as a refugee, he had been both imprisoned and tortured.[14]
[14]R v Abdulhussein CA175/01, 7 February 2002 at [10].
In dismissing the appeal, this Court affirmed the reason the Judge gave for declining to treat as mitigating the appellant’s different cultural values, which as the Court expressed it was this:[15]
The sentencing principles to be applied in relation to persons of a certain ethnic or racial group must be the same as those in other cases. Equality before the law is fundamental to the administration of justice.
[15]At [45].
In affirming that to be so as to the first ground, the Court may also have intended to affirm it as to the issue whether imprisonment would impose an undue burden on the appellant; and that the principle of equity on sentence must certainly be our starting point on this aspect of the appeal.
There is only one case of which we are aware, Feau v DSW, where a sentence has been contended to have infringed an offender’s ability to practice his religion.[16] It too preceded the Sentencing Act 2002, and is remote from this case. There a Seventh Day Adventist appealed a sentence of periodic detention on the ground that he was to be inducted on a Saturday, which was his Sabbath. Elias J held that, while that might limit his ability to practice his religion, if only on a single day, a right secured him by s 15 of the New Zealand Bill of Rights Act 1990, that did not make his sentence manifestly excessive. His concern ought to have been able to be answered administratively.
[16]Feau v DSW (1995) 2 HRNZ 528 (HC).
On this appeal there is not, and there cannot be, any issue that Mr Mehmood is entitled to hold his religious beliefs and to express them in daily practice.[17] The issue is whether his sentence denies him unduly the ability to practise his religion daily, set against the reality that the purpose and effect of every sentence of imprisonment is to curtail liberty.
[17]New Zealand Bill of Rights Act 1990, ss 13 and 15.
Nor is there any issue on this appeal as to what the tenets of Mr Mehmood’s religion require of him daily. A senior member of the Muslim community in Auckland, who has given an affidavit on Mr Mehmood’s behalf, identifies the duties he must comply with each day:
(a)He may not eat ham or pork in any form, or meat that has not been slaughtered according to Islamic law, or drink alcohol or eat food cooked in alcohol; and must fast for the month of Ramadhan, eating only one meal after sunset and another before dawn.
(b)He must pray five times a day, facing Mecca, with access to the Holy Quran, beginning just after dawn and ending just before midnight.
(c)He must wash his hands, face, head, ears, arms and feet before praying and before touching the Holy Quran, and wash himself fully at least once a day.
In his affidavit evidence Mr Mehmood contends, principally, that he could not comply with those duties while at the Northland Region Corrections Facility, Ngawha, to which he was transferred on 22 October 2014, shortly after his sentence was imposed, and where he remained until May this year, when he was transferred, first briefly to Spring Hill, Waikato, and then to the recently opened facility at Manukau, Auckland.
Mr Mehmood contends that at Ngawha he complained to the officers supervising his sentence a number of times that:
(a)unless he received Halal food he had to go hungry or eat food forbidden;
(b)he could not pray five times a day, particularly before dawn and after evening lock down, because that irritated his cellmate;
(c)he could not pray in a reflective environment because other prisoners’ televisions and radios were so loud;
(d)he could not identify the direction of Mecca or pray at a mosque or before an altar;
(e)he could not pray in his cell, because it contained a toilet, which both he and his cellmate had to use; and
(f)he could not shower and wash before prayers or when locked up.
The manager of the Ngawha facility says that there is no record on the Department’s electronic integrated offender management system that Mr Mehmood ever raised these issues before his April affidavit. A senior officer who spoke to Mr Mehmood on 4 May 2015 says that he then conceded that to be so; evidence that Mr Mehmood disputes in his affidavit in reply. He says that the officers did not record what he said and they did not attempt to assist him.
In his notice of appeal, dated 12 November 2014, we accept, Mr Mehmood did raise his concern about his diet, but not then any wider concern. Nor, more tellingly, had he raised any such wider concern when on 23 October 2014, soon after he was sentenced, he requested to be segregated.
In that request his concerns were entirely consistent with those identified in the materials before the Judge and the Department’s electronic record. He said that he was serving his first prison sentence, that he had never committed any offence before, that he wanted to do courses to help himself, that he was on medication for depression, and that he feared for his safety.
In the result, we are left with a question whether, and if so to what extent, Mr Mehmood did alert those supervising his sentence at the Ngawha facility to his particular needs as a practising Muslim; and that apart, the officer who spoke to him on 4 May 2015, does appear to have attempted to meet some at least of his concerns.
Mr Mehmood appears to accept that the officer did offer to inquire as to a Halal diet; a promise that he contends then came to nothing. While he is adamant that she never told him he could have a single cell, they do appear to have spoken about whether access to the wider environment of the prison would help him. His position was that he wanted to be placed in a self-care residence.
There is less issue, as we have said, about Mr Mehmood’s ability to comply with his religious duties at the South Auckland facility, where he will complete his sentence. When we heard this appeal, he was still being assessed for a self-care residence, which had yet to open. In such a residence he would be able to prepare his own food and his toilet and shower would not be in his sleeping and living areas. Even if he still remains in a cell, furthermore, he should be able to comply with his religious duties.
When we heard this appeal Mr Mehmood occupied a double cell by himself with a toilet and shower separated from his bed and study area by a Perspex screen. He could shower four times a day. He had access to an imam, who was to be at the prison increasingly. He was able to be supplied with Halal certified meat. The imam had been consulted about the wider dietary needs of Muslim prisoners. When Halal food was not available, he was to be supplied vegetarian food. During Ramadhan his two meals a day were to be delivered to him at 5pm so that he could eat after sunset and before sunrise; and he had been given a kettle.
Set against that state of affairs, and even taking into account the contested phase of Mr Mehmood’s sentence at the Northland facility, we are unable to be satisfied that, as s 8(h) of the Sentencing Act 2002 contemplates, he does lie within that exceptional category where his sentence has or will be disproportionately severe. We are unable to accept, therefore, that he is entitled to any discount on that basis.
Result
In the result we conclude that the sentence imposed on Mr Mehmood was proportionate to his offending and is not manifestly excessive on any of the grounds on which he relies. His appeal is dismissed.
Solicitors:
Crown Law Office, Wellington for Respondent
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