R v Malu

Case [2017] NZCA 546 29 November 2017

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA212/2017
[2017] NZCA 546

BETWEEN	THE QUEEN Appellant
AND	APINERU KERENISE MALU Respondent

Hearing:	25 October 2017
Court:	Kós P, Harrison and Gilbert JJ
Counsel:	P D Marshall and J A Eng for Appellant S K Green for Respondent
Judgment:	29 November 2017 at 11.30 am

JUDGMENT OF THE COURT

AThe application for leave to appeal is granted.
BThe appeal is dismissed.

____________________________________________________________________

REASONS OF THE COURT

(Given by Gilbert J)

Introduction

Apineru Malu was the sole director and shareholder of a company through which he provided marketing consultancy services. For nearly four and a half years, from June 2010 to October 2014, Mr Malu failed to file any income tax or GST returns and he evaded payment of over $178,000 in tax.
Mr Malu admitted his offending and subsequently filed the necessary returns. He attempted to sell family land in Samoa to enable him to pay part of the debt. He pleaded guilty in the District Court at Wellington to three representative charges of knowingly failing to file tax returns and tax evasion contrary to s 143B(1)(b) and (f) of the Tax Administration Act 1994. The maximum penalty for each of these offences is a term of five years’ imprisonment and a fine of $50,000.[1]
[1]Tax Administration Act 1994, s 143B(4).
This offending arose in the context of Mr Malu being left with a very substantial debt to pay following his father’s death in Samoa. As the oldest son, Mr Malu was then made a matai (family chief) and expected to assume a leadership role in place of his father. He succumbed to the cultural and financial burdens that were placed on him and he failed to meet his tax obligations in consequence. Mr Malu stated in an affidavit filed for the purposes of sentencing that he is “deeply ashamed” and wants to be able to keep working so he can repay his debt to the Commissioner of Inland Revenue and continue to provide for his family.
Mr Malu has been employed since January 2016 in a senior role in the state sector. He is supporting his mother and four dependent children, all of whom live with him. He also has responsibility to support his extended family including his three sisters and his aunt who live in Samoa. Mr Malu disclosed his offending to the chief executive of his employer and was told that a conviction would make his continued employment untenable.
Judge Bruce Davidson was satisfied that if a conviction was entered it was “almost inevitable” that Mr Malu would lose his employment.[2] The Judge considered that Mr Malu’s future career prospects would also be seriously damaged.[3] This would result in the loss of any prospect of Mr Malu being able to make significant reparation.[4] It would also cause “significant collateral damage” to Mr Malu’s mother and his four dependent children. The Judge considered that although the offending was “moderately serious”[5] these consequences would be out of all proportion to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading R v Malu

Details

AGLC: R v Malu [2017] NZCA 546
Case: [2017] NZCA 546
Decision Date: 29 November 2017 at 11.30 am

CaseChat Overview and Summary

The appeal was brought by the Crown against the decision of Judge Bruce Davidson of the District Court at Wellington, who discharged Apineru Malu without conviction. Malu had been charged with three counts of tax evasion and failure to file tax returns, offences carrying maximum penalties of five years' imprisonment and a $50,000 fine each. The Crown sought leave to appeal the decision on the basis that the Judge had erred in his assessment of the gravity of the offending, the direct and indirect consequences of conviction, and the finding that the consequences of conviction would be out of all proportion to the gravity of the offending. The Court of Appeal considered the submissions and found that while the decision to discharge Malu without conviction was unusual, it did not find any legal errors in the Judge's reasoning. The Court found that the Judge had properly assessed the gravity of the offending, taking into account mitigating factors such as Malu's guilty pleas, previous good character, and remorse. The Court also found that the Judge had properly assessed the direct and indirect consequences of conviction, which included the likely loss of Malu's employment and future career prospects, and the resulting inability to repay the tax and support his family. The Court found that it was open to the Judge to find that these consequences would be out of all proportion to the gravity of the offending in the particular circumstances of the case. The Court granted leave to appeal but dismissed the appeal as there had been no demonstrated error of law.

The final orders were that the application for leave to appeal was granted and the appeal was dismissed.

Orders