R v McMahon
[2012] NZHC 3372
•12 December 2012
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CRI-2012-085-7779 [2012] NZHC 3372
THE QUEEN
v
SANDRA JACQUELINE MCMAHON
Hearing: 12 December 2012
Counsel: S K Barr for Crown
C L Parkin for Defendant
Sentencing: 12 December 2012
SENTENCING REMARKS OF MACKENZIE J
[1] Sandra Jacqueline McMahon, you appear for sentence having pleaded guilty to:
(a) Five charges of possession of the Class C drug cannabis for supply;1
(b) One charge of selling the Class C drug cannabis;2 and
(c) One charge of money laundering.3
1 Misuse of Drugs Act 1975, ss 6(1)(f) and (2)(c), with a maximum penalty of eight years imprisonment on each charge.
2 Sections 6(1)(e) and (2)(c), with a maximum penalty of eight years imprisonment.
3 Section 12B(2), with a maximum penalty of seven years imprisonment.
R V MCMAHON HC WN CRI-2012-085-7779 [12 December 2012]
[2] You appear for sentence in this Court because the District Court has declined jurisdiction to sentence you.
[3] The circumstances of the offending are that in February 2012, the police commenced an investigation into the supply of cannabis by your family in the Wellington region. This investigation indicated that you, and police allege, your son, had carried on a substantial drug dealing operation for at least seven years. Your son faces charges which he is defending. This was a large operation with over
150 different customers who would buy cannabis from you on a regular basis, some once or twice a week and some once every two to three days. Some of your customers were on-selling to others.
[4] Between 5 and 14 June 2012, the police observed you and your son and intercepted your telephone communications. The phone conversations showed that you were selling cannabis to your customer base on a daily basis. Your customers would call you and arrange to meet up so that you could deliver their cannabis. For that 10 day period, you sold or offered to sell cannabis on 205 separate occasions with an average of 22 sales per day. Of those 205 transactions, you sold cannabis twice to 31 individual customers and three times to four individual customers. These transactions were identified by intercepting your cell phone communications. The police were unable to identify the quantity of cannabis that you were selling to each customer. But on at least two occasions you sold one ounce of cannabis and on at least one occasion you sold half an ounce. It was also clear from the search of your vehicle and addresses that occurred when you were arrested that you sold ounces, half ounces, $50 bags and $20 tinnies. On the night of 14 June when you were arrested, over one pound (490 grams) of cannabis packaged for sale was found in your vehicle.
[5] It became apparent from the intercepted phone communications that you were obtaining cannabis from at least two different suppliers. On Wednesday 6 June
2012, you arranged to meet with one of those suppliers. On the following day, the police followed you to a supermarket car park. At this time the supplier sold you
20 ounces of cannabis head material. Following this meeting, a call was intercepted between you and your son where you discussed the payment made to the supplier,
which was between $4,000 and $8,000. Following your arrest, the police executed a search warrant at your address. They located a blue cooler bag with the name of the supplier affixed to the inside of the bag. The cooler bag contained 284 grams of cannabis (or 10 ounces) in total divided between three plastic bags.
[6] On Thursday 7 June 2012, police intercepted a call between you and your second supplier. You and your supplier discussed the amount of cannabis that he would be able to obtain for you. You agreed that you would take three pounds of cannabis and arranged to meet that Saturday. On the Saturday you met with your supplier and you purchased the three pounds of cannabis from him. When searching your address, the police located a second blue cooler bag with the name of your second supplier once again affixed to the inside of the bag. The cooler bag contained three pounds of cannabis head, individually bagged.
[7] On Thursday 14 June 2012, you were arrested while you were driving around Wellington delivering cannabis to your customers. A search of your vehicle revealed a substantial amount of cannabis head that was packaged and prepared for sale. The cannabis was found inside a plastic shopping bag, in your handbag and on your person. The packages and quantities located were six one ounce bags, 13 half-ounce bags, 33 $50 bags, and 41 tinnies.
[8] In total, the police located 490 grams of cannabis in your vehicle, as well as
$5,070 in cash.
[9] A search warrant was also executed at your address. A further substantial amount of cannabis head was located, some of which was packaged and ready for sale. The police located:
(a) two plastic shopping bags containing 830 grams (or 1.8 pounds) of cannabis head;
(b)six plastic snap lock bags containing 18 grams (or half an ounce) of cannabis head (about 108 grams in total);
(c) sixty $50 bags of cannabis head (about 180 grams); and
(d) one hundred and twenty tinnies (approximately 192 grams in total). [10] The street value of the latter three quantities of cannabis as packaged for sale
would be about $6,300. The first item, the 830 grams not packaged for sale, would be valued at about a further $6,000.
[11] Police also executed a search warrant at an address that the police believed was used by you and your son to store, prepare and package cannabis. At that address, the police located:
(a) sixteen pounds of cannabis head material stored in large plastic buckets and plastic bags;
(b) thirty pounds of cannabis leaf material stored in large canvas bags; (c) two sets of electronic scales;
(d)various types of cannabis packaging including 1,800 pre-cut tinfoil squares for cannabis tinnies, and snap lock bags.
(e) $42,558.80 in cash which had been packaged in plastic snap lock bags and stored around the address.
[12] Between 5 January 2005 and 20 March 2012 you laundered money you received from selling cannabis through two bank accounts. You made over
300 deposits during that period. You minimised the risk of detection by avoiding bank staff when depositing money by using fast deposit towers. You co-mingled these funds with legitimate funds and used them to purchase assets. In total, you laundered $214,100.
[13] Turning to your personal circumstances, you are 68 years old and live in Wellington. You have three children, one of whom has been jointly charged for some offences, as I have mentioned. You currently receive national superannuation.
[14] In relation to your offending, the pre-sentence report writer notes that you acknowledge personal involvement in selling cannabis for a period of at least ten years. Your main motivation was profit. Even when you became aware of police surveillance of your activities, you continued offending without concern for the consequences. According to the report writer, you continued to deny the existence of a large drug dealing operation involving your son. You acknowledge the link between your offending and that of your son but say that you had separate customer bases and were not involved in the day to day running of each other’s operations. The report writer says that you feel remorse for family members you have affected by your offending and for your current situation, but your remorse for your offending is minimal.
[15] You have seven previous convictions for possession of cannabis for supply and selling cannabis between 1992 and 1995. The report writer says that your current offending represents a continued pattern of drug offending with an escalation in seriousness since your last conviction in 1995. You are assessed as at medium likelihood of reoffending and your risk of harm to others is assessed as low.
[16] In sentencing you, I am required to take into account the purposes and principles of sentencing set out in the Sentencing Act 2002. I consider the most relevant purposes to be holding you accountable for your offending, denouncing your offending, deterring you and others from such offending, and ensuring your rehabilitation.
[17] I must now fix the starting point. In setting the starting point for cannabis offending, guidance is provided by the Court of Appeal’s decision in R v Terewi.4
Although that case provides guidelines for cannabis cultivation sentencing, it is relevant also to possession for supply sentencing.5 As the Crown and your defence counsel agree, your offending is large-scale commercial offending which falls within
category three.
4 R v Terewi [1999] 3 NZLR 62 (CA).
5 R v Keefe CA275/02, 28 November 2002; R v Gray [2008] NZCA 224 at [7]-[12].
[18] Counsel for the Crown submits that the cannabis selling offending is within the most serious of cases, and that the maximum penalty should be imposed subject to the consideration of your circumstances. It must reflect what was seized at the termination of the operation, and that your offending persisted over about seven years, that it involved a large customer base and that it rendered significant amounts of revenue and profit. It submits that the money laundering and possession charges are aggravating features of the cannabis offending, and thus are reflected in the starting point suggested by the Crown. It says that a starting point of 10 years imprisonment is appropriate for the totality the offending.
[19] Your counsel submits that a starting point lower than that should be adopted. Counsel says that the Crown’s submissions proceed on the basis that you and your son ran a joint enterprise. But you say, through your counsel, that your offending was separate from that of your son. Your counsel submits that although you both used the storage address you stored your own cannabis and had your own customers. She says that you accepted there were some circumstances when you and your son worked together, for example, in buying cannabis to on-sell. Counsel submits that you should be sentenced on the basis of the monetary figures relating to you only.
[20] Counsel for the Crown contests that position and says that this should be regarded as a single operation in which both of you were involved. Because your son is to face charges, it is best that I do not go into detail of the circumstances to attempt an assessment of your involvement. It is sufficient to note that I consider that, whether your offending is viewed as a standalone operation for part of the totals involved or as a joint operation for the full amount involved, the total involved places you in a situation where this was a very substantial operation and puts your case within the most serious of cases on either or any view of the matter.
[21] The next point is that the Crown have undertaken some calculations and estimates to determine the scale of the operation. The police have assessed that there was a substantial profit from your operation. They say that, based on sales of half- ounces of cannabis at $150 each, the combined tax-free profits of you and your son could have been up to $2.3 million per year. Your family’s assets are worth just over
$3.1 million. These assets were obtained by your family at a time when you were
either receiving government benefits or were not in paid employment. You withdrew very little from your bank accounts, paying for most of your expenses in cash. Between June 2004 and February 2012 you made cash deposits totalling over
$1.5 million into the accounts of you and your children. The police say that the deposits into these accounts reflect that at least some of the profits generated by your cannabis operation. In addition, a number of the properties at which the police executed search warrants have been renovated or were being renovated at the time of the search.
[22] Counsel for the Crown submits that the total revenue from sales could have been in the range of $4.8m to $7.9m. Your counsel submits that the figure is too high and that you should be sentenced on the basis of revenue in the range of $2 to
$2.5 million.
[23] I do not attempt to reconcile those figures. I assess the scale of your operation by making a judgment based on the facts as I have described them. It is clear that, on that basis, this was a very substantial operation indeed. I consider that even on the lower figures submitted by your counsel, and taking into account all of the cannabis offending, the submission of counsel for the Crown that this is within the most serious of cases is justified. In such cases consideration of the maximum penalty is appropriate.
[24] In determining what would be an appropriate starting point, I have also looked at a number of comparable cases, those referred to by counsel, and some additional cases. I do not propose to discuss them in detail. They will be referred to in the written sentencing notes.6
[25] Taking into account all these factors, I adopt a starting point of the maximum penalty which applies to each of the cannabis charges. That is a starting point of
eight years.
6 R v Wharewaka HC Auckland CRI-2004-092-4373, 28 April 2005; R v Watson [2007] NZCA
432; R v Duong HC Auckland CRI-2009-404-118, 9 June 2009; R v Prest HC Auckland CRI-
2008-004-28639, 27 May 2010; R v Paul HC Hamilton CRI-2007-019-10127, 17 February
2009; R v Jeffries [1992] 1 NZLR 134 (CA); R v Daley (1999) 17 CRNZ 388 (CA).
[26] Counsel for the Crown submits that the money laundering charge should be treated as an aggravating feature of the cannabis offending. Counsel describes it as closely related to the drug dealing operation and confirming both the sophisticated nature of the operation and that substantial profits were made. I have taken this charge into account in forming the assessment that the cannabis offending is within the most serious of cases. To that extent, this charge has already been taken into account. There is however an additional separate level of criminality attached to it. That justifies a small uplift, which I fix at six months.
[27] I must now consider aggravating and mitigating personal factors. As I have noted you have seven previous convictions for possession of cannabis for supply and selling cannabis, dating back to 1992. Although those convictions were over fifteen years ago, you acknowledge that your offending has continued for the last ten years. I consider that an uplift of six months is appropriate to reflect your previous convictions.
[28] As to mitigating factors the Crown advises that there will be applications for forfeiture orders and recovery of profits. Counsel has described the stage of those and some of the difficulties which arise because of some of the properties being jointly owned. It is not possible to make an assessment in sentencing you of the scale of any recovery which may be possible. I do not regard the possibility of such orders as justifying consideration as a mitigating factor. The scale of your operation was such that it is likely that any recovery will represent less than the total profits obtained from the operation. At this stage in sentencing you, I do not consider that any deduction is appropriate.
[29] That leads to a sentence, before allowance for your guilty plea, of nine years.
[30] You are entitled to a discount for your guilty plea. The Supreme Court in Hessell v R has held that the discount given for a guilty plea must reflect all the circumstances in which the plea is entered, including whether it is truly to be regarded as early or late plea and the strength of the prosecution case.7 Taking into
account the timing of your pleas and the strength of the prosecution case, and also
7 Hessell v R [2010] NZSC 135, [2011] 1 NZLR 607 at [74].
reflecting a degree of cooperation which you demonstrated at some stages of the investigation, I allow a discount of 25 per cent. That amounts to two years and three months, and gives an end sentence of six years and nine months.
[31] The Crown submits that a minimum period of imprisonment is appropriate. It refers to R v Wharewaka8 and R v Watson,9 where minimum periods of imprisonment were imposed. Your counsel submits that a minimum period is not appropriate. Your counsel submits that R v Wharewaka, in particular, is different in that it involved gang offending. Your counsel refers to R v Nguyen and submits that your age and strong family support are relevant.10 She submits that a minimum period is not necessary for the purposes of deterrence and protection of the community. I have reached the view that a minimum period should not be imposed.
[32] So I sentence you as follows:
(a) On each of the charges of possession of cannabis for supply, you are sentenced to six years and nine months imprisonment.
(b)On the charge of selling cannabis, you are sentenced to six years and nine months imprisonment.
(c) On the charge of money laundering, you are sentenced to three years imprisonment.
(d) All of these sentences are to be served concurrently. [33] That is all, stand down.
“A D MacKenzie J”
8 R v Wharewaka, above n 6.
9 R v Watson, above n 6.
10 R v Nguyen [2009] NZCA 239.
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