R v Rowley - [2012] NZHC 1198

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CRI 2010-085-006205 [2012] NZHC 1198

THE QUEEN

v

DAVID INGRAM ROWLEY BARRIE JAMES SKINNER

Hearing: 30 April, 1-4, 7-11, 14-18, 21-24, 28-29 May 2012

Counsel: D La Hood with M J Ferrier and A Instone for Crown
M T Lennard for Accused

Judgment: 30 May 2012

RESERVED JUDGMENT OF THE HON JUSTICE KÓS (s 347 discharge application)

Introduction

[1] The accused apply under s 347 of the Crimes Act 1961 for discharge of counts 101 to 110, being charges that each accused knowingly provided false information to the Inland Revenue Department (the Revenue) in their personal tax returns for the years 2006 to 2010.

[2] Argument took place on 24 and 28 May; on 29 May I dismissed the application, with reasons to follow. These are the reasons.

Submissions

[3] The application is based on a short point of law.

R v ROWLEY & SKINNER HC WN CRI 2010-085-006205 [30 May 2012]

[4] For the accused, Mr Michael Lennard submits that to show that the returns are false (or the information contained in them is false) the Crown must prove that the accused’s taxable income was different from what was returned. The return is an “assessment” for the purposes of the Tax Administration Act 1994.1 Section 109 of that Act then 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.

A “disputable decision” includes an assessment. The present prosecution is not an objection proceeding under Part 8, or a challenge under Part 8A, but it is a proceeding in a court.

[5] Therefore, Mr Lennard submits, if the Crown wishes to bring evasion charges based on falsity of returns, it needs first to dispute the assessment by going through the Part 4A process (issuing a notice of proposed adjustment) or going through one of the other statutory exceptions enabling it to raise an amended assessment without
going through the Part 4A process.2

[6] For the Crown, Mr Dale La Hood accepts that the accused’s returns are “assessments” for the purposes of the Act. Where the Revenue believes that a return is fraudulently or wilfully misleading, the Revenue may amend the assessment at any time. The time limits in ss 107 and 108 of the Act do not apply.3 The Revenue’s preferred practice therefore is to amend the assessment after the outcome of the criminal process is known.

[7] The Crown says that s 109 is not engaged in the present prosecution because it applies only in civil proceedings, citing a decision of the Court of Appeal in R v

1 Tax Administration Act 1994, ss 92 and 92A.
2 See for instance Tax…

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 Rowley

Details

AGLC: R v Rowley [2012] NZHC 1198
Case: [2012] NZHC 1198
Decision Date: 30 May 2012

CaseChat Overview and Summary

In the case of R v Rowley, the defendants applied for discharge of counts 101 to 110, which involved charges of knowingly providing false information to the Inland Revenue Department in their personal tax returns for the years 2006 to 2010. The central issue was whether the Crown needed to prove that the accused's taxable income was different from what was returned, or if the returns being assessments under the Tax Administration Act 1994 meant they were deemed correct in all respects. The court had to decide if Section 109 of the Act, which precludes disputable decisions from being disputed in any proceedings except in specific circumstances, applied in this criminal case.

The court considered the Crown's position that Section 109 does not apply to criminal proceedings, relying on the Court of Appeal's decision in R v Allan. The Crown argued that while the returns are assessments, proving the falsity of the information provided did not require a prior challenge to the assessment. The court noted that the historical context of Section 109 suggested its purpose was to restrict collateral challenges to assessments, but it was not entirely convinced that the section was inapplicable in criminal cases. The court concluded that Section 109 applies in criminal cases only if a party directly attacks the prior assessment. In this instance, the Crown could charge under Section 143B(1)(c) without needing to first dispute the assessment, as the key element was proving the falsity of the information provided, not the correctness of the assessment itself.

The judgment highlights that while Section 109 may have broader effects, it does not preclude the Crown from prosecuting for the falsity of information in tax returns without first challenging the assessment. The court dismissed the application for discharge, allowing the prosecution to proceed.

Orders