R v Allan

Case [2009] NZCA 439

IN THE COURT OF APPEAL OF NEW ZEALAND

CA707/2008
[2009] NZCA 439

THE QUEEN

v

KARL ANDRE ALLAN

Hearing:9 March 2009

Court:Glazebrook, Rodney Hansen and MacKenzie JJ

Counsel:A Sharko for Appellant


S B Edwards for Crown

Judgment:25 September 2009 at 4.00 pm

JUDGMENT OF THE COURT

A        The appeal against conviction is dismissed.

B        The application to adduce fresh evidence on the appeal is granted.

C        The appeal against sentence is allowed.  The reparation figure is reduced to $51,407.70. 

____________________________________________________________________

REASONS OF THE COURT

(Given by Glazebrook J)

Table of Contents

Para No

Introduction  [1]
Factual background  [5]
The competing contentions at trial  [12]
Developments at sentencing  [20]
New evidence on appeal  [23]

Summary of the new proposed evidence  [24]
Mr Allan’s submissions on the proposed new evidence  [27]
The Crown’s submissions on the proposed new evidence  [30]

Conviction appeal[31]

The submissions of the parties  [31]
Our assessment  [33]

Sentence appeal  [38]

Issues  [39]
Should the Judge have held a disputed facts hearing?  [41]
What is the relevance of s 109 of the TAA?  [49]
Should s 32(3) of the Sentencing Act have been considered?                 [61]

Should penalties and use of money interest be included in any
reparation figure?  [71]

Result  [75]
Appendix:  Legislative provisions

Introduction

  1. On 21 May 2008, following a trial before Judge Rea and a jury in the Napier District Court, Mr Allan was convicted of nine counts of aiding and abetting a company (Logical Choice Ltd) knowingly to fail to file a GST return, intending to evade the payment of GST. 

  2. Mr Allan’s sentencing was originally scheduled to take place on 19 June 2008 but was deferred to give him time to make reparation in reduction of the total GST assessment amount of around $80,000 owed by Logical Choice.  This sum included both GST (of some $64,000) plus penalties and interest.  Mr Allan had raised only $13,900 by the resumed sentencing hearing on 16 October 2008.  At that hearing, he was sentenced to one year’s imprisonment and ordered to pay reparation of $80,000.

  3. Mr Allan appeals against his conviction and sentence.  He also seeks leave to adduce new evidence in relation to the appeal which, in his submission, shows that the GST payable by Logical Choice was less than the Crown evidence at trial suggested.  He submits that this could have affected the jury’s view at trial.  It would also have resulted in a lower reparation figure. 

  4. Before examining these contentions, we set out the factual background, the contentions of the parties at trial, the developments at sentencing and summarise the new evidence Mr Allan seeks to have admitted on appeal. 

Factual background

  1. Mr Allan ran a small business buying and selling electronic equipment.  This included importing electronics from overseas and on-selling them on Trade Me.  In December 2003, he incorporated Logical Choice.  While initially Mr Allan’s mother was the sole director and shareholder of the company, it was not disputed that it was Mr Allan’s company and that he ran the business.

  2. For the…

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R v Allan [2009] NZCA 439
Case
[2009] NZCA 439
Decision Date

CaseChat Overview and Summary

The case of R v Allan involved the defendant, Allan, who was convicted of an offence and faced sentencing under the Sentencing Act. The primary dispute centred on the application of Section 32 of the Sentencing Act, which pertains to the imposition of a sentence of reparation. Specifically, the court had to determine whether the offender should be required to compensate the victim for any consequential loss or damage resulting from the offence, and if so, to what extent. The issue also involved the interpretation of Section 109 of the TAA, which deems certain tax-related decisions as correct unless disputed in specific proceedings.

The court's task was to reconcile these statutory provisions, particularly focusing on whether a sentence of reparation could be imposed in light of the deeming provision under Section 109 of the TAA. The court had to consider whether the deeming provision precluded the imposition of a reparation order, or if it was merely an administrative hurdle that did not affect the court's discretion under Section 32. The court also needed to address the onus and standard of proof relevant to the reparation order, considering the implications of Sections 149A and 24 of the Sentencing Act.

In resolving these issues, the court concluded that the deeming provision under Section 109 of the TAA did not prevent the imposition of a sentence of reparation. The court reasoned that the deeming provision was specific to certain administrative and procedural aspects of tax law and did not extend to the broader sentencing powers of the court under Section 32. The court further held that the standard of proof for imposing a reparation order was the balance of probabilities, and the onus lay on the offender to prove mitigating facts unless they were manifestly false. This interpretation allowed the court to consider the appropriate reparation order while respecting the statutory frameworks of both the Sentencing Act and the TAA.

The court ordered that the offender, Allan, be required to pay a reparation order to the victim for the consequential loss and damage resulting from the offence, reflecting the court's discretion under Section 32 of the Sentencing Act. The specific amount of the reparation order was to be determined based on the evidence presented and the considerations outlined in the court's reasoning.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Section 24 of the Sentencing Act provides:24 Proof of facts (1) In determining a sentence or other disposition of the case, a court— (a)may accept as proved any fact that was disclosed by evidence at the hearing or trial and any facts agreed on by the prosecutor and the offender; and (b)must accept as proved all facts, express or implied, that are essential to a plea of guilty or a finding of guilt. (2) If a fact that is relevant to the determination of a sentence or other disposition of the case is asserted by one party and disputed by the other,— (a)the court must indicate to the parties the weight that it would be likely to attach to the disputed fact if it were found to exist, and its significance to the sentence or other disposition of the case:(b)if a party wishes the court to rely on that fact, the parties may adduce evidence as to its existence unless the court is satisfied that sufficient evidence was adduced at the hearing or trial:(c)the prosecutor must prove beyond a reasonable doubt the existence of any disputed aggravating fact, and must negate [beyond a reasonable doubt] any disputed mitigating fact raised by the defence (other than a mitigating fact referred to in paragraph (d)) that is not wholly implausible or manifestly false:(d)the offender must prove on the balance of probabilities the existence of any disputed mitigating fact that is not related to the nature of the offence or to the offender's part in the offence:(e)either party may cross-examine any witness called by the other party.(3) For the purposes of this section,— aggravating fact means any fact that— (a)the prosecutor asserts as a fact that justifies a greater penalty or other outcome than might otherwise be appropriate for the offence; and(b)the court accepts is a fact that may, if established, have that effect on the sentence or other disposition of the casemitigating fact means any fact that— (a)the offender asserts as a fact that justifies a lesser penalty or other outcome than might otherwise be appropriate for the offence; and(b)the court accepts is a fact that may, if established, have that effect on the sentence or other disposition of the case. Section 32 of the Sentencing Act provides:32 Sentence of reparation (1) A court may impose a sentence of reparation if an offender has, through or by means of an offence of which the offender is convicted, caused a person to suffer— (a)loss of or damage to property; or(b)emotional harm; or(c)loss or damage consequential on any emotional or physical harm or loss of, or damage to, property…(3) In determining whether a sentence of reparation is appropriate or the amount of reparation to be made for any consequential loss or damage described in subsection (1)(c), the court must take into account whether there is or may be, under the provisions of any enactment or rule of law, a right available to the person who suffered the loss or damage to bring proceedings or to make any application in relation to that loss or damage.(4) Subsection (3) applies whether or not the right to bring proceedings or make the application has been exercised in the particular case, and whether or not any time prescribed for the exercise of that right has expired…

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Section 3(1) of the TAA provides the definition of disputable decision as being: disputable decision means— (a) An assessment:(b)A decision of the Commissioner under a tax law, except for a decision— (i) To decline to issue a binding ruling under Part 5A; or(ii) That cannot be the subject of an objection under Part 8; or(iii) That cannot be challenged under [Part 8A; or]:(iv)that is left to the Commissioner's discretion under sections 89K, 89L, 89M(8) and (10) and 89N(3). Section 149A of the TAA provides:149A Standard of proof and onus of proof (1) The standard of proof in civil proceedings relating to the imposition of penalties is the balance of probabilities.(2) The onus of proof in civil proceedings— (a)Relating to evasion or similar act to which section 141E applies or to obstruction rests with the Commissioner: (b)Relating to any other matter or thing rests with the taxpayer.(3) The standard of proof in criminal proceedings relating to the imposition of penalties is beyond reasonable doubt.(4) The onus of proof in criminal proceedings relating to any matter or thing rests with the Commissioner.(5) The standard of proof for the purposes of an application for a Court order under section 17A is the balance of probabilities.(6) The onus of proof for the purposes of an application for a Court order under section 17A rests with the Commissioner.

Ratio Decidendi

Legal Principle Established

Section 32 of the Sentencing Act provides:32 Sentence of reparation (1) A court may impose a sentence of reparation if an offender has, through or by means of an offence of which the offender is convicted, caused a person to suffer— (a)loss of or damage to property; or(b)emotional harm; or(c)loss or damage consequential on any emotional or physical harm or loss of, or damage to, property…(3) In determining whether a sentence of reparation is appropriate or the amount of reparation to be made for any consequential loss or damage described in subsection (1)(c), the court must take into account whether there is or may be, under the provisions of any enactment or rule of law, a right available to the person who suffered the loss or damage to bring proceedings or to make any application in relation to that loss or damage.(4) Subsection (3) applies whether or not the right to bring proceedings or make the application has been exercised in the particular case, and whether or not any time prescribed for the exercise of that right has expired… Section 109 of the TAA provides:109 Disputable decisions deemed correct except in proceedings Except in objection proceedings under Part 8 or a challenge under Part 8A,— (a)No disputable decision may be disputed in a court or in any proceedings on any ground whatsoever; and(b)Every disputable decision and, where relevant, all of its particulars are deemed to be, and are to be taken as being, correct in all respects. Section 3(1) of the TAA provides the definition of disputable decision as being: disputable decision means— (a) An assessment:(b)A decision of the Commissioner under a tax law, except for a decision— (i) To decline to issue a binding ruling under Part 5A; or(ii) That cannot be the subject of an objection under Part 8; or(iii) That cannot be challenged under [Part 8A; or]:(iv)that is left to the Commissioner's discretion under sections 89K, 89L, 89M(8) and (10) and 89N(3). Section 149A of the TAA provides:149A Standard of proof and onus of proof (1) The standard of proof in civil proceedings relating to the imposition of penalties is the balance of probabilities.(2) The onus of proof in civil proceedings— (a)Relating to evasion or similar act to which section 141E applies or to obstruction rests with the Commissioner: (b)Relating to any other matter or thing rests with the taxpayer.(3) The standard of proof in criminal proceedings relating to the imposition of penalties is beyond reasonable doubt.(4) The onus of proof in criminal proceedings relating to any matter or thing rests with the Commissioner.(5) The standard of proof for the purposes of an application for a Court order under section 17A is the balance of probabilities.(6) The onus of proof for the purposes of an application for a Court order under section 17A rests with the Commissioner.