Mycroft v Ministry of Social Development
[2015] NZHC 2520
•14 October 2015
IN THE HIGH COURT OF NEW ZEALAND ROTORUA REGISTRY
CRI-2014-463-45 [2015] NZHC 2520
BETWEEN MICHELLE LISA MYCROFT
Appellant
AND
THE MINISTRY OF SOCIAL DEVELOPMENT
Respondent
Hearing: 13 October 2015 Counsel:
D Hall for Appellant
C H Macklin for RespondentJudgment:
14 October 2015
JUDGMENT OF BREWER J
This judgment was delivered by me on 14 October 2015 at 10:00 am pursuant to Rule 11.5 High Court Rules.
Registrar/Deputy Registrar
Solicitors/Counsel: Douglas Hall (Rotorua) for Appellant
Gordon Pilditch (Rotorua) for Respondent
MYCROFT v THE MINISTRY OF SOCIAL DEVELOPMENT [2015] NZHC 2520 [14 October 2015]
Introduction
[1] Judge CJ McGuire sentenced Ms Mycroft to 100 hours’ of community work in the District Court at Rotorua on 18 July 2014. Ms Mycroft had pleaded guilty to three charges of wilfully omitting to tell an officer concerned with the administration of the Social Security Act of her current income for the purpose of misleading an officer concerned with the administration of the Act, thus resulting in her receiving
benefits under the Act.1 Over a period of just over three years, Ms Mycroft acquired
fraudulently $13,304.61. Ms Mycroft wanted to be discharged without conviction.
She now appeals against Judge McGuire’s refusal to do so.
Background
[2] There is quite a lot of detail in the background to Ms Mycroft’s offending. It is relevant to the assessment, to which I will come, of the gravity of the offending. I will, therefore, now set out the background detail as recorded by Judge McGuire in his sentencing notes:
[2] This offending occurred over a period from July 2009 to March
2012. Over that period of time, save for the time between October 2010 and
January 2011, Ms Mycroft received a sickness benefit where, it would seem, something like three weeks in 2012 when she was not on a benefit as well. The amount involved here is $13,304.61. Ms Mycroft is currently paying that sum off.
[3] The facts summary in this case discloses that on or about
20 July 2009, she applied for a sickness benefit, in which case she was ask to specify where she had been working in the last 52 weeks. She correctly stated she had been working for Ascend Quality Care. However, she incorrectly stated that her last day of work was 9 July 2009 and that she only intended to return to work once her treatment had been completed. She signed the client obligation section of the form indicating that, amongst other things, the information provided was true and correct, and that she would advise the Ministry of Social Development of any material changes to her circumstances. Based on that information, she was granted a sickness benefit, which was backdated to 17 July. In fact, she continued to work for Ascend Quality Care until 26 March of the following year.
[4] Once the benefit was granted, letters generated every three months. Amongst other things, it told the defendant that if she returned to work, she must inform the Ministry of Social Development.
[5] She was also required to provide an updated medical certificate to ensure that her sickness benefit continued. Further, after each letter, stating
1 Social Security Act 1964, s 127.
that she must notify the Ministry of Social Development if she earned or received any money, as this would affect her sickness benefit entitlement.
[6] Between July 2009 and March 2010, she received wages of around
$5621.99. This is money she should have told the Ministry of Social
Development about, as it could have affected her sickness benefit and supplementary assistance entitlement.
[7] Between July 2010 and September 2012, she received wages from CCS Disability Ltd, totalling $7945.76 for the financial year 2010/2011 and a further $8407.86 for the financial year 2011/2012. When applying for various benefits, the defendant did not disclose these payments to the Ministry of Social Development.
[8] On 7 September 2010, she applied for a temporary additional support benefit from Ministry of Social Development. In order to apply for this benefit, the defendant was required to complete the temporary additional support application form. In that form, the defendant had to declare her income and whether she would be receiving any income for the next
52 weeks. She did not declare any income, although she had been working for Ascend Quality Care and CCS Disability during the relevant period.
[9] At the end of the form she stated she had one more medical operation to undergo and after this, she would be able to resume full-time work. Due to the information provided by her, she advised she had received temporary additional supplement. Her sickness benefit continued until
18 October 2010, which at time she advised the Ministry that she had returned to work.
[10] Between 5 October 2010 and 21 January 2011, she worked for
Fergusson Rest Homes and earned gross payments totalling approximately
$5892.75. While working for that employer, she transferred from the sickness benefit to a non-beneficiary accommodation supplement. The defendant was entitled to receive this supplement while she worked until
5 February 2011, at which point she transferred back onto a sickness benefit. Had the defendant informed the Ministry about her second employment role
with CCS, this would have affected her entitlement to a non-beneficiary accommodation supplement.
[11] On 1 February 2011, she applied for and was granted a sickness benefit. This benefit ran until 30 January 2012 when she became a full-time student. She correctly advised the Ministry that she had been working at Fergusson Rest Homes from 5 October 2010 to 28 January 2011.
[12] The defendant stated she needed to take leave from this job as she was not well enough to continue employment. She failed to advise the Ministry that at that time she continued to work for CCS Disability Ltd and was just about to start another job, working for Jennifer Sosich, via Home Grown Kids Ltd. Between 1 February 2011 and 3 October 2011, she received wages from Jennifer Sosich, via Home Grown Kids Ltd. Ms Sosich cared for her disabled child and the defendant assisted in that task. She received gross payments totalling $3940.95. Despite being obliged to do so, the defendant never disclosed these payments to the Ministry of Social Development.
[13] On 25 July 2011, she applied for a temporary support benefit by completing a written application form. In the relevant income section, the defendant incorrectly stated she had no income. She stated that she needed additional assistance because she had lost a boarder and was trying to get part-time work. This time she was working for both CCS Disability and for Jennifer Sosich.
[14] On 15 December 2011, she applied for an advance of her benefit. The reason was so that she could purchase reading glasses. As part of the written application, she incorrectly stated that her income was ‘nil’. At the time she was working for both CCS Disability and Jennifer Sosich.
[15] On 3 November 2011, she again applied for additional support benefit by completing a written application form. The reason given was that she had lost a boarder and was having to take care of her sick mother. In that form, the defendant incorrectly stated she had not received any income apart from the benefit. In fact, she was working for CCS Disability.
[16] On 30 January 2012, she came off the sickness benefit to commence study as a full-time student. On 28 February 2012, she reapplied for a sickness benefit by completing a written form. At the same time, she also applied for a domestic purposes benefit (care of sick and infirm). Again, the defendant incorrectly stated she has not received any income in the past
52 weeks. In fact, she had received an income from CCS Disability and from Jennifer Sosich.
[17] Based on the answers provided in written form, the defendant was granted a sickness benefit on 28 February 2012. On 5 June 2012, the defendant transferred from this benefit to the domestic purposes benefit (care of sick and infirm).
[18] Through this period, the Ministry sent the defendant a number of letters. Amongst other things, the letters set out the defendant’s clear obligation to inform the Ministry of any changes in her circumstances, including income and wages. The letters were sent to the defendant on quite a number of occasions between September 2009 and March 2012.
[19] As a result of the offending, she received an overpayment of benefit during the period 17 July 2009 to 25 March 2012 as follows:
(a) Sickness benefit - $10,353.63;
(b) Accommodation benefit - $711.71;
(c) Temporary additional benefit - $2222.47; (d) Temporary GST assistance - $16.80. Totalling $13,304.61.
Discharge without conviction
[3] Section 106 of the Sentencing Act 2002 empowers a Court to discharge an offender without conviction and deems such a discharge to be an acquittal. However, s 107 provides:
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.
[4] There is, therefore, a three-step process which a Court should follow in deciding whether the criteria for a discharge without conviction have been met:
(a) Identify the gravity of the offending by reference to the particular facts of the case;
(b) Identify the direct and indirect consequences of a conviction; and
(c) Determine whether the direct and indirect consequences of conviction would be out of all proportion to the gravity of the offending.
[5] Judge McGuire, during his sentencing, followed this process in abbreviated form. He concluded that the offending was of moderate gravity. Counsel are agreed that that is the case, and I concur. On identifying the direct and indirect consequences of entering a conviction, the Judge found that they relevantly and principally go to the likely difficulty of obtaining work in Ms Mycroft’s chosen field (nursing).
[6] The Judge then turned to consider whether the direct and indirect consequences of Ms Mycroft’s offending are out of all proportion to the gravity of the offending. His Honour said:
[33] As has been said many times before, our system relies on honest feedback by clients. I have great sympathy for the trials that Ms Mycroft has been through in recent times, but with respect to her, they are no different than what I suspect the majority of those on benefits are going through. The whole purpose of having the State safety-net is to look after people who have fallen on bad times, who have been taken out of the workforce by illness or by having to look after sick members of their families. So in that light, the
uniqueness of Ms Mycroft’s position fades somewhat. In fact I conclude that
she is in a position not too much different from others.
[34] Ultimately, in her case, I find that because her professional organisation must observe the principles of natural justice when they come to weigh any conviction that she has against her ability to work in a field, and because I understand that convictions are not an absolute bar to work in this area, I must find that establishing that a conviction in this case is out of all proportions to the gravity of the offending has not been made out in this case. Accordingly, Ms Mycroft, I am sorry, you will be convicted.
Grounds for appeal
[7] I start by observing that Mr Hall for Ms Mycroft had hoped to be in a much stronger factual position for this appeal. Since Judge McGuire’s sentencing, Ms Mycroft’s mother has died and Ms Mycroft has resolved to move to the United Kingdom where she has relatives. Mr Hall anticipated putting before the Court evidence of new circumstances relating to obtaining an appropriate entry permit to the United Kingdom and obtaining work there as a caregiver. However, Mr Hall now advises that although convictions will affect Ms Mycroft’s ability to move to the United Kingdom to work, and obtain work there, the difficulties are not of a kind greatly different from the difficulties identified at the sentencing. Accordingly, Mr Hall proceeds on the grounds of appeal as filed originally.
[8] Mr Hall submits that the primary error in the Judge’s reasoning is to take the approach that because the convictions do not form “an absolute bar” to Ms Mycroft finding work in her chosen field, then she should not receive a discharge without conviction. Mr Hall submits that this is too high a test. I do not read the Judge’s decision in that way. Rather, the Judge identifies the likely consequences (convictions will make finding a job difficult) and adds that if Ms Mycroft wants to work as a nurse then she has the comfort that the nursing profession is bound to follow due process. My reading of the Judge’s sentencing notes is that his reference to “an absolute bar” is a reference to a situation which might have caused him to take a different view of the direct and indirect consequences of convictions if it had existed.
[9] Mr Hall also submits that the Judge should not have characterised the situation of Ms Mycroft as being “not too much different from those of other
beneficiaries”. Ms Mycroft was in the position of caring for her terminally ill mother and so subject to a great deal of stress. This is not the position of the typical offender.
[10] I do not agree with Mr Hall’s characterisation of the Judge’s position. The Judge’s observation, as I read it, was directed to the purpose of the Social Security benefit system and recognised that recipients of benefits are almost always in vulnerable circumstances. In any event, the Judge was right not to characterise the stress that Ms Mycroft was under during the period of her offending as amounting to a circumstance which, in a case such as this, could positively move his conclusion in Ms Mycroft’s favour.
[11] Finally, Mr Hall points to the offer by Ms Mycroft to complete voluntary work and to increase her repayments of the defrauded sum. Mr Hall notes that the Judge did not refer to those matters and submits that the Judge appears to have left them out of his deliberations. I find that these matters are inconsequential. An offer to complete voluntary work, rather than to have completed voluntary work, is not persuasive of anything. The complainant Ministry has the right to seek repayments from Ms Mycroft at whatever level is reasonable.
Decision
[12] This is an appeal by way of rehearing. I must make my own assessment of the case. I am assisted by the reasoning of the Judge but if I conclude there is an error, and that the error justifies a different sentence, then I must allow the appeal and impose the sentence I find appropriate.
[13] I agree with Judge McGuire that the gravity of the offending is moderate. I accept that there are extenuating circumstances, particularly the struggle Ms Mycroft was having in caring for her terminally ill mother. However:
(a) Ms Mycroft’s offending was premeditated and persistent. It was not just a matter of failing to advise of a change in circumstances. Ms Mycroft worked for three different organisations and repeatedly
made applications for supplements or advances to which she was not entitled. Each such application required a deception.
(b)The offending persisted over a period in excess of three years. In that time Ms Mycroft obtained by fraud just over $13,000. The Judge seemed to accept that, in part, her offending was caused by an understanding – allegedly provided by an officer of the complainant – that she was entitled to earn $5,100 annually. The Judge gave that matter little weight, and he gave it more weight than I would have done. By entering pleas of guilty, Ms Mycroft accepted criminal responsibility for the essential elements of the charges. In any event, her offending had to be discovered.
(c) I consider that Judge McGuire correctly identified the direct and indirect consequences of the offending. There is a real and appreciable risk that Ms Mycroft will find it difficult to gain employment in her chosen field because of the convictions. But that is inevitable and not at all exceptional. Further, not only do I accept that this Court should be slow to conceal offending from professional registration bodies, I also accept the Judge’s evaluation that Ms Mycroft at least has the comfort that her professional body is bound to follow due process.
(d)On the issue of whether the consequences of conviction for Ms Mycroft are out of all proportion to the gravity of her offending, I again find myself in agreement with Judge McGuire.
[14] These are crimes of dishonesty involving fraudulently obtaining Social Security benefits. They are of moderate gravity, even making full allowance for extenuating personal circumstances. It might be that the convictions will make it difficult for Ms Mycroft to obtain employment in her chosen field. It might be that this could be said to be disproportionate in its hardship to the gravity of her offending when the extenuating personal circumstances are taken into account. But I do not accept that it would be out of all proportion.
[15] I consider that this case is really quite similar to one I decided in August
2015.2 On a comparative basis, I think that the appellant’s circumstances in that case were more compelling than in Ms Mycroft’s case and yet the result had to be the same.
[16] The appeal is dismissed.
Brewer J
2 O’Hagan v Ministry of Social Development [2015] NZHC 1833.