R v Cho
[2018] NZHC 561
•28 March 2018
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CRI-2012-404-464
CRI-2017-004-1955 [2018] NZHC 561
THE QUEEN v
ALLEN BRYAN CHO SHALENDRA SINGH ALZAIN KHAN
BRENDON NGUYEN
Hearing: 28 March 2018 Appearances:
B Northwood for the Crown P Wicks QC for Mr Cho
S Lance for Mr Singh
J Kovacevich for Mr Khan
S Lack (on behalf of R Mansfield) for Mr NguyenSentence:
28 March 2018
SENTENCE OF WOODHOUSE J
Counsel / Solicitors:
Mr B Northwood, Meredith Connell, Office of the Crown Solicitor, Auckland Mr P Wicks QC, Barrister, Auckland
Mr S Lance, Barrister, Auckland
Mr J Kovacevich, Barrister, Auckland Mr R Mansfield, Barrister, Auckland
R v CHO [2018] NZHC 561 [28 March 2018]
[1] Mr Cho, Mr Singh, Mr Nguyen and Mr Khan: you each appear for sentence for offences of dealing in class C controlled drug analogues, having pleaded guilty to the charges. Mr Khan, you also appear for sentence having pleaded guilty to three representative charges relating to methamphetamine dealing and a charge of participating in an organised criminal group.
Factual background and charges
[2] The drug analogue offences were uncovered as part of a police operation known as “Operation Ark” which commenced in 2010 and terminated in late 2011. A principal focus of Operation Ark was the activities of a company known as London Underground. That company imported, in powder form, very large quantities of the controlled drug analogue known as 4-MEC. That is an analogue of the class B controlled drug methcathinone. London Underground produced very large numbers of pills containing 4-MEC and, through various principals or major associates of London Underground, sold these pills at wholesale to dealers and they were then on- sold through the market. Evidence at the trial of the principals, and some others, at which I presided, established that the wholesale price of each pill was around $20 and that retail sales could be up to $40 and perhaps more. The evidence also established that London Underground had produced around 1.3 million pills, of which around 1.2 million had been sold into the market.
[3] I note that having presided at the trial at which most of the defendants were found guilty and then having sentenced those defendants, I have obviously enough a fair degree of knowledge of these matters. And most significantly for the purposes of sentencing, an understanding of relevant matters of parity between sentences imposed by me on defendants at the end of that proceeding and sentences I need to impose on you.
[4] I will summarise the offences each of you are to be sentenced on, with some further brief factual background. Estimated quantities and values of pills you dealt with are indicated later.
Mr Cho
[5] Mr Cho, you obtained pills from Mr Cameron, a principal associate of London Underground. He was not a principal of London Underground but connected to principals of that organisation. You supplied most of those pills to others, including your co-offenders Mr Singh and Mr Nguyen. When those pills were to be on-sold, you managed the supply chain. In relation to your offending, Mr Cho, you are to be sentenced for 14 offences of selling a class C controlled drug, 17 offences of possessing a class C controlled drug for sale, and three offences of offering to sell a class C controlled drug.
Mr Singh
[6] Mr Singh, you received and on-sold the pills you received to others, including to Mr Khan. The Crown says the pills were supplied to Mr Khan in exchange for methamphetamine. You are to be sentenced for nine offences of selling a class C controlled drug, 11 offences of possessing a class C controlled drug for sale, and two offences of selling a class C controlled drug.
Mr Nguyen
[7] Mr Nguyen, for your role, you face sentence for 10 offences of selling a class C controlled drug and one of possession of a class C controlled drug for sale.
Mr Khan
[8] Mr Khan, in relation to the drug analogue offences you are to be sentenced for seven offences of possession for sale of a class C controlled drug and one offence of selling a class C controlled drug.
Maximum penalties
[9] The maximum penalties for each of those three offences relating to class C controlled drugs – and in this case controlled drug analogues – is imprisonment for 8 years.
Mr Khan: methamphetamine offences
Mr Khan, you also appear for sentence – as I have already indicated – in relation to methamphetamine dealing. There are three representative charges; one of supply, one of possession for supply, and one of offering to supply methamphetamine. There is a related charge of participating in an organised criminal group.
[10] The charges for methamphetamine dealing and the related charge, arose out of a police operation – completely separate from Operation Ark – known as Operation Ceviche. In the offending targeted by Operation Ceviche, you worked for a senior patched member of the Hells Angels gang. You dealt in methamphetamine for him and would deal in money on his behalf. You also independently obtained methamphetamine, but always under his oversight, and sold it directly or “on tick” – that is to say, on credit.
[11] The maximum penalty for the methamphetamine offences is life imprisonment. The maximum penalty for participating in an organised criminal group is 10 years imprisonment.
Starting point
[12] The first step in fixing an end sentence is to assess the starting point. In all of your cases this requires an assessment of the length of a prison sentence based on the seriousness of your offending without, at this stage, taking into account any personal factors that might justify an increase or decrease in the starting point. Personal factors
– and they cover a wide range of things – will be considered next.
[13] Counsel have referred to a number of cases involving sentencing for dealing, in various ways, with controlled drug analogues. Although the controlled drug analogue in this case is a class C controlled drug, starting points reflect the fact that controlled drug analogues are, in general, analogues of at least class B controlled drugs, even though they are classified as class C.1 As I have indicated earlier, 4-MEC
1 Fraser v R [2013] NZCA 250 at [14].
is an analogue of the class B controlled drug methcathinone, but it was also designed to mimic the effects of ecstasy – a different drug again.
[14] I will not discuss the cases that have been referred to me in any detail. I will note the names of the cases in a footnote in the transcript of what I am saying.2 The sentences of relevance, for comparative purposes, do include two of the sentences I imposed on some of the defendants who were found guilty in the first Ark trial. I will mention two sentences only:
(a)Mr Challis was a dealer. During one period Mr Challis sold approximately 27,000 pills. Over a separate seven month period orders were received for around 3,000 to 4,000 pills a week. Mr Challis received a starting point of 5 years imprisonment.3
(b)Mr Cress was also a dealer. He sold more than 70,000 pills. His offending was assessed as more serious than that of Mr Challis because of the level of sales. Mr Cress received a starting point of 6 ½ years imprisonment.4
I will come back to this.
[15] Although those are the starting points that I fixed, the law, in essence, has changed since then.5 That is an over-simplification, but it is a matter that I must take into account in relation to the level of seriousness. I will come back to that. I do not intend to go into a discussion of the law.
[16] An important consideration, when fixing a starting point for dealing in a controlled drug analogue, is the nature of the defendant’s guilty state of mind. And what I am about to say touches on what I said more generally. Where a defendant is found guilty, or pleads guilty, to dealing in a controlled drug analogue, this will be on
2 Fraser v R, above n 1; R v Lau [2013] NZHC 1463; R v Lowe [2013] NZHC 2591; R v Chase [2015] NZHC 317; R v Cameron [2018] NZHC 81; R v Lavrent [2018] NZHC 229; R v Morris [2018] NZHC 200 (sentence indication).
3 R v Chase, above n 2, at [75]-[77].
4 At [81]-[82].
5 Cameron v R [2017] NZSC 89, (2017) 28 CRNZ 166.
the basis that either the defendant knew or believed the substance in question was a controlled drug analogue or, as the alternative, the defendant was aware that it might be and was reckless as to whether or not it was.6
[17] In assessing the seriousness of the offending of each of you, in order to fix a starting point, there is some difference between these two types of guilty mind – and this is important. To an extent there is more culpability, or seriousness, in knowing or believing that the substance is a controlled drug analogue compared with recklessness. An illustration is in the sentencing of a principal associate of London Underground, Mr Cameron, who, following a successful appeal, pleaded guilty on the basis that he was at least reckless. On re-sentencing, Palmer J reduced the starting point that I had imposed from 9 years, which had been fixed on the basis of actual knowledge, to 8 years based on recklessness.7 I proceed on the basis that your guilty states of mind, reflected in your guilty pleas, is based on recklessness. And for the Crown, Mr Northwood acknowledges that that is the appropriate approach. He made a submission on relative degrees of recklessness, but the important point is that the foundation for the assessment is recklessness, not actual knowledge. There is a material difference.
[18] In this regard, it is of some importance – and I do place weight on the fact – that you were given assurances that the pills you were dealing with were legal. As was apparent from the very long Ark 1 trial, this was an integral part of the modus operandi of the London Underground principals – to convey to others, including those obtaining pills from them, that it was all entirely legal – they were legitimate party pills.
Mr Cho: starting point
[19] Mr Cho, I come to the starting point for you. You sold in excess of 175,000 pills. The price for each pill varied. For example, in relation to one of the charges, you sold 1,000 pills for $19 a pill in June 2011, but on another charge sold 35 pills for
$35 a pill in the same month. Police located just over 4,000 pills when you were arrested and about $450,000 in cash. Assuming you had sold 150,000 pills, all at $19
6 Cameron v R, above n 5, at [97].
7 R v Cameron, above n 2, at [17].
a pill, the total would be $2.85 million. When that figure is put in the context of the total established as having been received by the principals, or by London Underground, the figure is understandable. But I am not going to sentence you on that sort of basis. The Crown proceeds on the basis that you made in excess of $450,000 given the amount of cash that was found. At one level that is, perhaps, a conservative approach. But I am satisfied I still need to treat this with some caution. As Mr Wicks QC submitted, you had to account to others for cash you received.
[20] The Crown submits that the starting point should be in the vicinity of 7 years imprisonment. The Crown submits that this reflects the fact that your offending is more serious than that of Mr Challis and Mr Cress – you dealt in larger quantities and also had oversight over a supply chain.
[21] Mr Wicks has submitted on your behalf that a starting point of 5 ½ years is more appropriate. He has sought to distance you from London Underground, arguing that your culpability is reduced by virtue of the fact that you were not directly involved in the lead offending of London Underground principals. In my judgment, perhaps the more significant point in that regard is that you were not receiving information that some of the other defendants that I earlier dealt with were receiving from the London Underground principals.
[22] I have reflected on the starting point with some care. Weighing matters overall I have concluded that it should in fact be 5 ½ years imprisonment. This must be compared with the starting point of 6 ½ years for Mr Cress as a dealer of, in relative terms, only 70,000 pills. Your offending was more extensive, but you are to be sentenced on the basis of recklessness, whereas Mr Cress was sentenced on the basis that he actually knew the pills were illegal. There also needs to be relativity with the starting point of 8 years on the re-sentencing of Mr Cameron.8 His offending in comparative terms was far more serious than yours. He was a party to importing over 254 kilograms of 4-MEC powder and to sale of around 1.24 million 4-MEC pills. I do not want to diminish the gravity of your offending – or of the other defendants – but plainly, in that context, culpability, assessed against quantities, is very very much
8 R v Cameron, above n 2.
lower. At the other end I also need to compare the sentences more recently imposed on Ms Lau and Mr Lowe in respect of possession of 88,000 pills for the purpose of supply, although not for supply directly by them.9
Mr Singh: starting point
[23] Mr Singh, the starting point for you. You dealt in around 116,000 pills. Your offending was less serious than Mr Cho’s and in many ways you were his subordinate. The Crown submits that a starting point of 6 ½ years would be appropriate. It will be apparent from the starting point I have adopted for Mr Cho that I consider that that is too high.
[24] On your behalf Mr Lance submits that the starting point should be around 4 years.
[25] I agree with Mr Lance’s submissions. In large measure you were simply an intermediary. The starting point will be 4 years imprisonment.
Mr Nguyen: starting point
[26] Mr Nguyen, your offending was at a much lower scale than that of Mr Cho and Mr Singh. The quantity of pills supplied, over a period from July to November 2011, was around 598 – perhaps more, but that is the quantity established – together with an unknown quantity on another occasion. You were also found in possession of approximately 3,000 pills.
[27] The Crown submits that the starting point should be 2 ½ years imprisonment. On your behalf, Mr Lack, following reference to relevant cases – and Mr Mansfield in the written submissions – submitted that the starting point should be 2 years imprisonment. There was reference, in particular, to the sentences of Ms Lau and Mr Lowe.
[28]I am satisfied that the appropriate starting point is 2 years imprisonment.
9 R v Lau, above n 2; R v Lowe, above n 2.
Mr Khan: starting point
[29] Mr Khan, a starting point needs to be fixed in relation to the main, or lead offence. In your case it is an offence of supplying not less than 150 grams of methamphetamine. Starting points for methamphetamine dealing are to be assessed by reference to a Court of Appeal guideline in a case called Fatu.10
[30] Your offending comes within what is called band 2 of Fatu, with starting points ranging from 3 to 9 years imprisonment depending on the quantity involved – or at least in large measure depending on the quantity involved.
[31] Your co-offenders, Mr Dutt, Mr Ali and Mr Tseng, dealt in similar amounts of methamphetamine. When he was sentenced in the District Court, the starting point for Mr Dutt was 6 ½ years imprisonment. Mr Ali and Mr Tseng, who dealt in identical quantities, received starting points of 6 years imprisonment.
[32] Mr Kovacevich on your behalf, and the Crown, agree that the starting point should be 6 years imprisonment.
[33] However, Mr Kovacevich, as I understood it, submitted that this should be the starting point for all of the methamphetamine offences and the related organised criminal group offence. The Crown submits that should be the starting point for methamphetamine supply and that there should be an increase of 1 to 2 years for the other offences. In those other cases there were uplifts, in one case, of 6 months, and in the two other offences dealt with in the District Court – although that was in relation to different numbers and types of offences for each of the other offenders – [2 years and 2 ½ years]. In your case I consider the other offences do not justify an increase of more than 6 months, which increases the starting point to 6 years 6 months.
[34] A further increase is required for the drug analogue offences – the class C offences. The Crown and Mr Kovacevich agree on 6 months. You dealt in about 8,100 pills. A stand alone starting point would be higher but, taking account of totality, I
10 R v Fatu [2006] NZLR 72 (CA).
agree that the increase should not be more than 6 months. This further increases the starting point to 7 years.
Personal circumstances
[35] I come now, and firstly in a general way, to questions of personal circumstances.
[36] The Crown acknowledges that none of you has any personal circumstances requiring consideration of an increase.
[37] There are different personal circumstances relating to each of you requiring reductions. And those differing circumstances, as to be expected, are materially different in numbers of respects. Those aspects will be considered separately.
[38] There are two further considerations or circumstances which do apply to all of you. One is delay in completing the prosecution against each of you. The other is the guilty pleas.
Delay
[39] There has been a delay now coming on to close to 6 ½ years since you were arrested. And this is delay in completion of the prosecution.
[40] Because of this delay, you applied for stay of the prosecutions against each of you. The application was declined by Palmer J but he did conclude that the delay has been undue.11
[41] I do not intend to summarise the history of the various Operation Ark proceedings – and there have been several and a follow-on proceeding called Operation Greenstone. The history is fully set out in this Court’s judgment – that is to say, the judgment of Palmer J I have just referred to.
11 R v Cho [2017] NZHC 3036.
[42] I will, however, quote his primary conclusion which provides the foundation in this case for a reduction in sentence. The Judge said:12
Overall, in hindsight, as defence counsel submitted, I consider the key factor contributing to the delay was the prosecution’s decision to separate the defendants into different groups for different trials. The Ark 1 defendants [the ones I dealt with] were tried more than three years ago. The Ark 2 and Ark 5 defendants could have been tried with them. That would have been a reasonable time for disposition of the case against them. No doubt defence counsel are correct that the decision was taken in good faith. No doubt there were resourcing considerations to take into account as Mr Johnstone [who was counsel for the Crown] submitted. And the prosecutor may not have known of the effect in terms of delay, though something of the sort may have been foreseeable given the nature of the legal issues. But an effect there has been. I consider the delay deriving from this decision counts against the state [the Crown] and exceeds the reasonable time by more than can be justified on any acceptable basis. On the basis of the information currently available to me, I consider the delay has been undue to that extent.
And I just add there, that I am not aware of any further information which materially alters that general conclusion.
[43] Mr Cho, Mr Singh and Mr Kahn – your counsel submit there should be a reduction of 18 months for this very long delay – and it is undoubtedly very long. This reduction is based on the same allowance in a case of R v Williams.13 Mr Nguyen, in your case Mr Mansfield and Mr Lack submitted that it should be 20 to 30 per cent – that is to say, it is put as a percentage against the starting point rather than a calculation of months.
[44] I am satisfied there must be a substantial reduction. It is nevertheless to be noted that the reduction of 18 months in Williams was described by the Supreme Court as generous.
[45] As Mr Northwood noted in his oral submissions, there are arguments both ways in terms of the allowance that should be made – for more or for less. Without going into those sorts of considerations, and without regard to any other personal circumstances of each of you – and, as I say, which vary substantially between each of you – if this was to be assessed in terms of months, I would have thought the
12 R v Cho, above n 11, at [37].
13 R v Williams HC Auckland CRI-2007-404-6, 6 December 2007.
appropriate reduction should be around 12 months from the sentence that would otherwise be imposed. That is the base allowance that I will use, but for the reason just noted it will be factored in with an overall allowance for personal circumstances, assessed either in months or as a percentage.
[46] These matters cannot be assessed with mathematical precision. Flexibility needs to be retained to deal with individual circumstances in order to do justice in the individual case. One simple example – and it is a simple example, there are much more complicated matters – relates to bail. Both Mr Khan and Mr Nguyen were, for different periods, subject to particularly severe restrictions arising from bail conditions. Mr Cho and Mr Singh were not. This very long delay, and the lives you have constructed over the period, makes this case very different from the normal sentencing case. And that is a matter defendants’ counsel have obviously emphasised, and which is recognised by the Crown.
Guilty pleas
[47] The other general matter which can be brought under the heading of personal circumstances concerns the guilty pleas. You all seek reductions of 25 per cent for guilty pleas.
[48] The Crown submits that an appropriate allowance would be 15 per cent. But the Crown acknowledges that an allowance of 25 per cent for guilty pleas by three defendants in Operation Greenstone provides support for your contentions that it should be 25 per cent.14
[49]I am satisfied that the allowance should be 25 per cent in all cases.
Personal circumstances – each defendant
[50] I will now deal with your individual cases. I will record my conclusions based on the comprehensive submissions I have received from your respective counsel, together with the substantial range of supporting documents for each of you.
14 R v Morris, above n 2.
[51] I do not consider that at this point it is necessary to go into the detail, and I will not.
Mr Cho – personal circumstances
[52] Mr Cho, on the basis of the information I have received relating to you, and in particular what you have achieved since you were arrested, I am satisfied there should be an overall reduction of 36 months for delay and other personal considerations. I emphasise that this is a comprehensive assessment taking into account all of your personal circumstances in conjunction with the delay consideration, rather than a totalling up of allowances for a range of individual items.
[53] This may seem a very large reduction, but the circumstances of this case – which I have already touched on – because of the procedural history, coupled with all of the relevant considerations relating to you over the last 6 years or so, make this case
– and again as I have already said – very different from the normal case. To a greater or lesser extent that general observation applies also in the cases of the remaining defendants, Mr Singh, Mr Nguyen and Mr Khan. But I will not repeat these general observations. The general observations apply to the allowances I have made for personal circumstances.
[54] Mr Cho, this reduces the starting point to 30 months. It is further reduced by 8 months, bringing it down to 22 months, being the 25 per cent for the guilty pleas, with a minor rounding.
[55] As a consequence, I am entitled, as a matter of law, to consider a sentence of home detention. Taking everything into account – and again, because I feel I must, emphasising that this case is most unusual – in your circumstances there will be a sentence of home detention.
[56]The sentence Mr Cho, will be a sentence of 10 months home detention.
Mr Singh – personal circumstances
[57] Mr Singh, your personal circumstances, both before and after this offending, are different from those of Mr Cho, as is to be expected and, as I have already anticipated in these general remarks, I keep making. However, I am satisfied that in your case there should also be some further deductions. With an allowance for delay included, the starting point of 4 years is to be reduced to 1 ½ years imprisonment.
[58] There is a further reduction of 5 months for the guilty pleas. If a prison sentence were to be imposed that would result in a sentence of 13 months imprisonment.
[59] I am satisfied in your case that the purposes and principles of sentencing applicable to you – as was the case with Mr Cho – can be met by a sentence of home detention. There is a home detention report. The proposed address is suitable from a technical point of view. I am also satisfied that it is otherwise a suitable address, and notwithstanding some observations in the pre-sentence report.
[60]There will be a sentence of home detention of 6 months.
Mr Nguyen – personal circumstances
[61] Mr Nguyen, the reduction from the starting point of 12 months in respect of delay – just looking at that individually – would reduce the sentence, if imprisonment were to be imposed, to 12 months.
[62] You do have a number of previous convictions, but these are of a nature quite different from the offences I am dealing with, and the last offence was committed almost 18 years ago, in May 2000. You are entitled to some credit for what you have achieved since you were arrested, although this needs to be proportional. I will allow 6 months, which amounts to 50 per cent of the reduced starting point and is a generous allowance.
[63] There is a further reduction of 2 months for the guilty pleas which means that, if there was a prison sentence, it would be for 4 months.
[64]This is not a case for imposition of a prison sentence.
[65] On your behalf Mr Mansfield, in his written submissions, and Mr Lack, have submitted that an appropriate sentence would be one of 6 months community detention. In all of the circumstances of this unusual case, I agree. The sentence will therefore be one of 6 months community detention.
Mr Khan – personal circumstances
[66] Mr Khan, in light of the submissions on your behalf, and the relevant information, and what I have said on a range of topics up to this point, the most straightforward approach is to allow an overall reduction of 70 per cent from the starting point for all matters.
[67] That means that the starting point of 7 years imprisonment is reduced to imprisonment for 25 months. That is the sentence I will impose. It cannot be lower.
Final sentences
[68]Would you all now please stand.
[69]Mr Cho, you are sentenced to home detention for 10 months.
[70]Mr Singh, you are sentenced to home detention for 6 months.
[71]Mr Nguyen, you are sentenced to community detention of 6 months.
[72] Mr Khan, you are sentenced to imprisonment for 2 years 1 month for the methamphetamine offences. The sentences for the class C controlled drugs and participating in an organised criminal group are 9 months imprisonment. All sentences are to be served concurrently.15
15 The original sentence imposed was 2 years 9 months. This was stated in error. Mr Khan was recalled and the sentence was corrected to one of imprisonment for 2 years and 1 month.
[73] To the extent that there are any other charges, the Crown has acknowledged that it will not be proceeding on those charges and they are accordingly dismissed.
[74]You should all now please stand down.
Woodhouse J
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