R v Li

[2007] NZCA 402

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA449/06
CA312/07
[2007] NZCA 402

THE QUEEN

v

REBECCA KATSZI LI

Hearing:23 August 2007

Court:Chambers, Randerson and John Hansen JJ

Counsel:B J Hart and A J Trenwith for Appellant

S B Edwards for Crown

Judgment:10 September 2007 at 2 pm

JUDGMENT OF THE COURT

AThe appeal against conviction is allowed to the extent that the convictions on counts 8, 9, 10, 13, and 15 are quashed.

B        The appeal against sentence is dismissed.

____________________________________________________________________

REASONS OF THE COURT

(Given by Randerson J)

Introduction

[1]       The appellant was convicted in the District Court after a jury trial on 49 charges.  Twenty-nine of these were for forgery and the remainder were for counterfeiting and related charges.  Judge Joyce QC presided at the trial and subsequently sentenced the appellant to an effective term of four years imprisonment.  A minimum period of two years imprisonment was imposed in respect of the forgery convictions.

[2]       This appeal against conviction and sentence is concerned only with the convictions on 29 counts of forgery.  Two of these (counts 1 and 7) were laid under s 264 Crimes Act 1961 in respect of offending alleged to have occurred prior to 1 October 2003.  On that date, the former ss 264 and 265 Crimes Act were repealed and replaced with new provisions including s 256 (forgery) and s 257 (using forged documents).  The remaining 27 forgery counts were laid under the new s 256(1). 

[3]       The appeal against conviction is advanced on two broad grounds:

a)In respect of the 27 forgery counts laid under the new provisions, it was not open for the jury to convict the appellant under s 256(1) under which the maximum penalty is 10 years imprisonment.  Rather, any convictions ought to have been in respect of the separate crime created by s 256(2) for which the maximum penalty is only three years imprisonment. 

b)Eleven counts were defective for separate reasons we detail later.

[4]       The sentence appeal is on the basis the sentence was manifestly excessive because:

a)The appellant should have been sentenced on the basis of the maximum penalty of three years under s 256(2) rather than 10 years under s 256(1).

b)In respect of counts 1 and 7, the maximum sentence was reduced between the date of the offending and the date of sentencing with the result that the maximum penalty should have been three years rather than 10 years by virtue of s 6 Sentencing Act 2002.

c)The imposition of the minimum period of imprisonment was not warranted in the circumstances.

Background facts

[5]       The appellant was the sole director and shareholder of a company engaged in printing, graphic design and sign-writing.  The Crown case was that from the year 2000 or earlier, the appellant began producing a range of forged certificates and other documents including degree or diploma certificates for a number of tertiary institutions such as the University of Auckland, as well as a range of other documents such as IELTS (International English Language Testing System) certificates.  Many of these appeared to have been made to order because the names of individuals had been inserted in them. 

[6]       In May 2004, one of the appellant’s former employees handed to the police a number of items taken from her business premises.  These included compact discs containing files downloaded from the company’s computers containing templates for a number of the forged documents.  Shortly afterwards, the police executed a search warrant at the appellant’s premises and located a variety of forged certificates and documents as well as a number of counterfeit stamps and seals for the tertiary institutions, a residence permit stamp used by the New Zealand Immigration Service, a solicitor’s stamp, a substantial quantity of goatskin parchment paper and several hundred blank exam results notices for the University of Auckland.

[7]       The Crown case was that the appellant had made false or deceptive documents for the purpose of being sold to people who would pay substantial sums for false certificates and other documentation.  Although the Crown case depended largely on inferences to be drawn from the nature of the documents and the materials found, there was direct evidence from one witness who said he had paid $5,000 for an IELTS certificate.  And, there was evidence from another witness that the appellant had asked him whether he knew any persons who might wish to acquire University of Auckland degree certificates.  Although there were a number of employees coming and going from the business during the relevant period, the Crown case was the appellant was the only person consistently involved during the relevant period and it was she who was mainly involved in creating the forged documents.  Although there were a number of computers at the premises, it was the computer found in the appellant’s office which contained almost all the materials used to create the forged documents.

[8]       The appellant’s defence was that she was an innocent party, deceived by the real forger, who, she said, was one of the employees who had given evidence against her for the Crown.  The appellant did not give or call evidence on her own behalf but it is common ground she has consistently maintained her innocence and continues to do so.

[9]       In his summing up, Judge Joyce directed the jury that in respect of the offending alleged from 1 October 2003 onwards, the Crown had to prove beyond reasonable doubt that:

a)      The appellant made a false document; and that

b)     She intended to use the document to obtain any property, privilege, service, pecuniary advantage, benefit, or valuable consideration.

[10]     It was not suggested by the appellant’s then trial counsel (not present counsel) that the forgery charges post-1 October 2003 should have been laid under s 256(2) rather than s 256(1).  Understandably, that issue was not therefore addressed in any way at trial.

First ground of appeal – forgery charges wrongly brought under s 256(1).

[11]     Mr Trenwith dealt with this part of the argument on behalf of the appellant.  He submitted first that the Judge had erred in not leaving to the jury the lesser charge of forgery under s 256(2) as an alternative to the charge under s 256(1).  Alternatively, the appellant’s conduct was insufficient to satisfy the requirements for forgery under s 256(1) and the only appropriate inference for the jury to draw was that she was guilty of forgery under s 256(2).

[12]     Prompted by questions raised by the Court during argument, counsel’s argument focused principally on two issues:

·          What mental element is required to be proved under s 256(1)? and

·Does an intention to use a false document in terms of s 256(1) include an intention to sell it to another person?

The legislation

[13]     Section 256 Crimes Act provides:

256     Forgery

(1)   Every one is liable to imprisonment for a term not exceeding 10 years who makes a false document with the intention of using it to obtain any property, privilege, service, pecuniary advantage, benefit, or valuable consideration.

(2)   Every one is liable to imprisonment for a term not exceeding 3 years who makes a false document, knowing it to be false, with the intent that it in any way be used or acted upon, whether in New Zealand or elsewhere, as genuine.

(3)   Forgery is complete as soon as the document is made with the intent described in subsection (1) or with the knowledge and intent described in subsection (2).

(4)   Forgery is complete even though the false document may be incomplete, or may not purport to be such a document as would be binding or sufficient in law, if it is so made and is such as to indicate that it was intended to be acted upon as genuine.

[14] This section is found in Part 10 Crimes Act which was inserted with effect from 1 October 2003 by s 15 Crimes Amendment Act 2003. The amending legislation effected substantial change to this Part of the Act. One of its main purposes was to create certain new offences involving various forms of computer crime.

[15]     Section 256 replaced the former s 264.  Under the previous provision, it was an offence punishable by imprisonment for up to 10 years to:

… [make] a false document, knowing it to be false, with the intent that it shall in any way be used or acted upon as genuine, whether within New Zealand or not, or that some person shall be induced by the belief that it is genuine to do or refrain from doing anything, whether within New Zealand or not.

[16]     The new s 256 created the two separate offences specified in subss (1) and (2).  For the first time, the concept of making a false document with the intention of using it to obtain property or some other form of gain was introduced in subs (1) with a maximum penalty of 10 years.  To “obtain” some form of gain includes doing so for the benefit of the maker of the false document or for some other person:  see the definition in s 217. 

[17]     The offence formerly created by s 264 was substantially re-enacted as subs (2) but with the penalty reduced from 10 years to 3.

[18]     Under s 256, it is not necessary for the Crown to prove any actual use of the false document.  The criminality lies in the making of the false document with the specified intent or knowledge (as applicable).  A separate offence of using forged documents is created by the new s 257 (formerly uttering under s 266).

[19]     We are satisfied the Crown is not required to prove any element of dishonesty additional to that inherent in the making of the false document with the specified intention and knowledge (as applicable).  First, the history of the passage of the amending Bill shows that clauses in the Bill referring to dishonesty and deception were deleted in the section finally enacted (see clause 203 of the draft Crimes Bill of 1989; the report of the Crimes Consultative Committee to the Minister on the Bill in 1991; and clause 305ZH of the Crimes Amendment (No 6) Bill 1999).   Secondly, the concepts of acting dishonestly or obtaining by deception were specifically enacted in other provisions of the new Part 10 – see, for example, ss 219, 225 and 240.  Thirdly, s 217 specifically defines the expression “dishonestly” by reference to the absence of a belief that the maker had authority to undertake the prohibited act.  This suggests the legislature turned its mind to those provisions requiring proof of dishonesty and those which do not.  All of this makes it clear that the essential ingredients required to be proved under both s 256(1) and (2) are confined to those specified in those provisions.

[20]     It remains to consider the second main argument under this heading, namely whether the “intention of using” the false documents under s 256(1) includes an intention to sell them or whether the forgery charges should have been brought under s 256(2).  In order to answer that question, it is necessary to compare the provisions. 

[21]     Section 256(2) differs in a number of respects from s 256(1):

·There is an express requirement that the Crown prove the accused made a false document knowing it to be false, although this is an implicit requirement of s 256(1) in any event.

·There is no need to prove an intention on the part of the accused to use the document for some form of gain.  Rather, the Crown must prove the accused intended that, “in any way”, the document be used or acted upon as genuine (whether in New Zealand or elsewhere).

·The language in subs (2) is more open-textured than in subs (1).  For example, the intention to be proved is that the false document be used or acted upon “in any way”.  The contrast with the expression “with the intention of using it” in subs (1) suggests that subs (2) embraces use of the false document either by the maker of the false document or by anyone else, while subs(1) contemplates the maker using it himself or herself.

·The greater penalty under subs(1) appears to relate to the element of gain, advantage or benefit required under that provision (although we acknowledge the same distinction does not apply under s 257). 

[22]     We consider that the principal distinction between s 256(1) and s 256(2) lies in the use of the false document for the purpose of making some form of gain.  That distinction was discussed in the Report of the Crimes Consultative Committee to the Minister of Justice in April 1991 in relation to the (then) clause 203 of the Crimes Bill 1989:

This provision proposes to distinguish, for the purposes of penalty, between persons who forge documents for gain and persons who otherwise forge documents intending that they be acted on as genuine.  The committee supports this distinction.

[23]     While we accept there are some potential inconsistencies in the language of s 256(1) and s 257(1)(b) and (c) (which refer to using, dealing with or acting upon a document), we consider that the expression “with the intention of using” the false document in s 256(1) is sufficiently wide to include a case such as the present where the appellant’s intention was to sell the false documents.  This amounts to an intention to use the false documents to gain a pecuniary advantage or valuable consideration within the meaning of the section.  It does not matter that the purchaser may well have known the documents were false.

[24]     If the appellant’s argument were correct, it would mean that she, as the maker of the false document for gain, would be liable for only three years imprisonment under s 256(2), whereas the user of the same document would be liable for 10 years imprisonment under s 257(1)(a).  That would be illogical and cannot have been intended. 

[25]     We do not consider the Judge was obliged to allow the jury to consider an alternative charge under s 256(2).  It is well established that the mere fact that the lesser crime may necessarily be included in the crime charged in terms of s 339(1) Crimes Act does not mean it must be put to the jury.  The principles which the law applies were set out by this Court in R v Mokaraka [2002] 1 NZLR 793 at [12] to [19] and in R v McDonald [2007] NZCA 142 at [11]. As this Court said in Mokaraka at [18]:

In the end there remains a broad discretion to be exercised by the trial Judge in the light of the particular circumstances of the particular case.  The aim is to ensure that the issues left to the jury reflect those that fairly arise on the evidence without unnecessary distractions.  It is not for an appellate Court to intervene unless satisfied that the jury may have convicted out of a reluctance to see the defendant get away with what, on any view, was disgraceful conduct.

[26]     Here, it may be that the offence under s 256(2) was included in s 256(1), but there was clear evidence from the witnesses Messrs Sen and Yu to support the inference that the appellant was intending to (and in one case did) sell the forged documents.  The defence at trial was that the appellant was not the forger or counterfeiter.  There is nothing to suggest that the possibility of a lesser charge was raised at trial and, in our view, this possibility was not fairly raised on the evidence.

[27]     We conclude that the relevant charges were properly laid under s 256(1) and there was no obligation on the Judge to include the lesser charge under s 256(2).  This ground of appeal must fail.  

Second ground of appeal against conviction – defective documents

[28]     The appellant submitted that some of the documents were so defective that they could not possibly have been acted upon as genuine.  It followed that no reasonable jury could have concluded that the appellant intended to use these documents for gain under s 256(1) or intended that the documents be used or acted upon as genuine in terms of s 256(2).

[29]     Attention was drawn to s 256(3) which provides that forgery is complete as soon as the document is made with the intention required for subs (1) or with the knowledge and intention described in subs (2).  Plainly, both the making of the document and the relevant mental element must coincide and, as soon as they do, the forgery is complete.

[30]     It was accepted there may be a partial forgery.  That is clear from the definition of “false document” under s 255 Crimes Act which provides:

false document means a document—

(a)     of which the whole or any material part purports to be made by any person who did not make it, or by a fictitious person; or

(b)     of which the whole or any material part purports to be made by or on behalf of any person who did not authorise its making, or on behalf of a fictitious person; or

(c)     of which the whole or any material part has been altered, whether by addition, insertion, deletion, obliteration, erasure, removal, or otherwise, and that purports to have been altered by or on behalf of a person who did not alter it or authorise its alteration, or by or on behalf of a fictitious person; or

(d)     that is, in whole or in part, a reproduction of any other document, and that purports to have been made by or on behalf of a person who did not make it or authorise its making, or by or on behalf of a fictitious person; or

(e)        that is made in the name of a person, either by that person or by that person's authority, with the intention that it should pass as being made by some other person who did not make it, or by a fictitious person.

[31]     The documents said to be defective in the present case were those the subject of counts 6, 8, 9, 10, 11, 13, 15, 18, 35, 36 and 37.  Having examined these documents, we are satisfied that those relating to counts 8, 9, 10, 13, and 15 were so defective that a reasonable jury could not have concluded that they were intended to be used for gain or that they were intended to be used or acted upon as if they were genuine.  A similar conclusion was reached by this Court in R v Taylor CA336/00 1 November 2000. 

[32]     Counts 8, 9, 13 and 15 were intended to be degree certificates from the University of Auckland but, in each case, the University crest was placed upside down and at the foot of the page instead of the top.  Count 10 also purported to be a University of Auckland degree certificate but did not display any University crest. 

[33]     In all the other cases, the defects were minor and much less obvious and it is not clear there was no basis upon which a reasonable jury could have concluded the appellant had the necessary intent.

[34]     Ms Edwards for the Crown relied on s 256(4), submitting that the offence of forgery was complete even though the documents themselves were not complete.  The difficulty with this submission is that while a partial forgery may suffice, that is so only if it is “so made and is such as to indicate that it was intended to be acted upon as genuine.”  Given the obvious defects in these documents, the jury could not reasonably have been satisfied they were intended to be acted upon as genuine.  It may be however that a charge of attempted forgery could lie in these circumstances.

Sentence appeal

[35]     It follows from our findings in relation to the conviction appeal that the sentence of four years imprisonment must be reassessed.  First, because the convictions on counts 8, 9, 10, 13, and 15 cannot be sustained in any event; and secondly, because it is accepted that the appellant is entitled to the lower penalty of three years on counts 1 and 7 by virtue of s 6 Sentencing Act 2002.

[36]     In sentencing the appellant, Judge Joyce regarded the forgeries as the lead offences.  He adopted a starting point of five years imprisonment on the forgery counts and deducted one year for personal factors relating to the appellant arriving at a final sentence of four years imprisonment.  He then imposed sentences ranging from 18 months to two years nine months on the remaining charges, all sentences to be served concurrently.

[37]     The Judge regarded the offending as serious.  He placed particular emphasis on the high quality of the forged degree certificates and referred to the care and skill required to manufacture the seals.  He described the end result of the appellant’s work as “magnificent facsimiles indistinguishable from the real”. The Judge also emphasised the commercial nature of the offending; the very real capacity to use the false documents to cause wide-ranging damage to the reputations of important and respected institutions such as the University of Auckland, the Auckland University of Technology and the Immigration Service; and the diversity of the documents manufactured. 

[38]     On the other hand, the Judge took into account that there were no outward signs of large sums of money having been made by the appellant; her previous good record; and her responsibilities towards her young child.

[39]     Despite the lower maximum penalties for the forgery counts and the other consequences of the appeal against conviction, we must nevertheless recognise the seriousness of this offending and when assessing the totality of what was done, take into account the other offending which has not been challenged.  There is no tariff case for offending of this kind, but we consider the effective sentence of four years imprisonment remains appropriate despite the partial success of the appeal against conviction.

[40]     As to the minimum period of imprisonment, we are satisfied, for the reasons the Judge gave, that this was a case where a minimum period of imprisonment was warranted.  Apart from the aggravating features which we have already mentioned, we agree with the Judge that denunciation and deterrence for insidious and potentially damaging offending of this kind justifies a minimum period of imprisonment longer than the normal period of one-third and that the period of two years he adopted was appropriate.

Summary

[41]     The appeal against conviction is allowed to the extent that the convictions on counts 8, 9, 10, 13, and 15 are quashed.

[42]     The appeal against sentence is dismissed.

Solicitors:

Crown Law Office, Wellington