Randell v The Queen
[2014] NZCA 188
•19 May 2014 at 9.30 am
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA471/2013 [2014] NZCA 188 |
| BETWEEN | ROSEANNE RANDELL |
| AND | THE QUEEN |
| Hearing: | 1 April 2014 |
Court: | O’Regan P, Keane and Andrews JJ |
Counsel: | J Murdoch & P J Broad for Appellant |
Judgment: | 19 May 2014 at 9.30 am |
JUDGMENT OF THE COURT
AAppeal against conviction for causing loss by deception allowed.
B No order for a retrial on that count.
C Sentence appeal dismissed.
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REASONS OF THE COURT
(Given by Keane J)
On 21 May 2013, Roseanne Randell and her co-offender, Paraone Tamihana, were convicted following their trial in the District Court, Manukau, of 17 counts of obtaining by deception and three of causing loss by deception. They were each sentenced concurrently for each of their offences to imprisonment for four years, five months.[1]
[1]R v Randell DC Manukau CRI-2010-092-18107, 21 June 2013 (sentencing notes).
Ms Randell appeals her conviction as to one of those offences only, causing an $18,000 loss by deception to Alan Moore, a master mariner and marine consultant, between 10 June and 3 July 2010.
Ms Randell’s offence lay, as the count specified, in falsely representing to Mr Moore that she and Mr Tamihana had purchased a super yacht, Moonlight II, which was to arrive in New Zealand on 20 July 2010, and in employing him as their manager to bring it to New Zealand and become responsible for it.
Ms Randell’s single ground of appeal is that the trial Judge, Judge Blackie, misdirected the jury as to the nature of the loss required to found a conviction for causing loss by deception under s 240(1)(d) of the Crimes Act 1961. That loss, she contends, has to be a direct loss. Mr Moore’s loss, a loss of fees, was an indirect loss. It was an expectation loss.
In the event that her conviction appeal succeeds, Ms Randell appeals her sentence to have it reduced proportionately.
Deception and loss
In early 2010, Ms Randell and her then partner, Mr Tamihana, held out fraudulently that Mr Tamihana’s business, the House of Ra, had won a $5.5 billion contract from the Jumeirah Group to assist wealthy Dubai residents to relocate to New Zealand. As part of their deception, they held out that they intended to purchase a super yacht, Moonlight II.
On 11 June 2010 they engaged Mr Moore to bring the yacht to New Zealand, to ensure that it complied with New Zealand regulations, to berth and to crew it, and to manage it afterwards. Mr Moore agreed, but said that he would require a contract of engagement. On 17 June 2010 Mr Moore sent to Ms Randell and Mr Tamihana the contract he proposed, one term of which stated:
The charge for the above services is NZ$4,000 plus GST per week plus disbursements. All disbursements will be supported by vouchers. An hourly rate of $150 plus GST will apply for piece work for periods of less than a week. Invoicing will be done weekly during the initial stages and monthly after purchase of the vessel. MBL will require advance payment for the two weeks of operation in the amount of NZ$8,000 and subsequent payments on the presentation of any invoice.
Mr Moore was told, however, that Mr Tamihana’s lawyer, who had to approve the contract first, had gone to the Virgin Islands because the terms of the yacht purchase were in dispute. Despite that, Mr Moore assessed what would be called for to bring the yacht to New Zealand and to berth it. He calculated sailing times and fuelling needs and assessed berthing and crew requirements.
On 2 July 2010, when Mr Moore met Ms Randell, Mr Tamihana, and others, at an Auckland waterfront restaurant, Mr Tamihana told him that the contract would have to await the lawyer’s return to New Zealand. Mr Moore accepted that. His greater concern was to obtain $500,000 to meet the expenses he was about to incur. He was assured that this payment would be made into his bank account on the following Monday.
On 3 July 2010 Mr Moore sent Ms Randell and Mr Tamihana an email outlining the arrangements he had put in place and attaching a voyage plan and crewing proposals. On 5 July 2010 Mr Moore stopped work after Ms Randell sent him an email telling him that everything was on hold. By then he was owed four weeks fees: $18,000 (including GST).
At trial neither Ms Tamihana nor Ms Randell took issue with Mr Moore’s terms of engagement, or his right to the wages he claimed. Ms Randell denied that she had ever caused him that loss by intentionally deceiving him. Her defence was that she honestly believed that the representations made to him were true.
Judge Blackie summed up to the jury in the following way:
Count 19 is Mr Moore, $18,000 is his loss because he says that it was represented to him that he would be in charge of the super yacht, Moonlight [II], which was going to arrive in New Zealand on the 20th July and he would be employed as their manager of the yacht and its staff and he says that he went out and started doing work making arrangements for the receipt … and the crewing of this yacht. The arrangement was that he’d have a weekly fee, that he went for a number of weeks, four weeks, he’s charged his fee plus the GST …, but he got nothing. He says he wouldn’t of course have done the work if he’d known in advance that there was going to be nothing at the end of the day.
Submissions
Ms Randell contends that in this Judge Blackie assumed, incorrectly, that Mr Moore’s $18,000 loss of fees was a qualifying loss under s 240(1)(d). Relying on Morley v R,[2] she contends that under s 240(1)(d) only a direct actual loss qualifies and that Mr Moore’s loss was not in that category. It was an expectation loss.
[2]Morley v R [2010] 2 NZLR 608 (CA).
The Crown contends that Mr Moore did suffer a qualifying loss; an immediate quantifiable detriment. Anticipating that he would be paid at the rate agreed, he completed four weeks unpaid work, setting to one side his ability to earn income by other means. He was also entitled to an $8,000 advance and that was owing to him from the day he began work.
Nature of loss
In issue in this Court in Morley was whether the vendors under four agreements for sale and purchase of property suffered losses, qualifying under s 240(1)(d), after Mr Morley proved unable to complete purchase. If they were qualifying losses there was no issue that Mr Morley had caused the vendors those losses by a knowing deception.
This Court distinguished the offence of causing loss by deception under s 240(1)(d) from the three other offences s 240(1) creates, “the obtaining offences”, each of which culminates in a definite outcome. In the case of the s 240(1)(a), that outcome may be caused either “directly or indirectly”.
Section 240(1)(d), the Court said, speaks only of a “loss” without defining it, and without saying whether it may be caused “directly or indirectly”. But it does require that the deception cause the loss; and thus it must be “in the nature of a direct loss”.[3] As the Court said “the gist of the offence is causing loss by deception”, and so “the loss must be a consequence of the deception” and “must have been induced by, or caused in reliance upon, the deception”.[4]
[3]Morley, above n 2, at [33].
[4]At [34].
The Court identified two “obvious examples” of losses qualifying under s 240(1)(d): “being induced by the deception to part with money or to invest in a scheme which fails”, and “wasted expenditure or out of pocket costs induced by the deception”.[5] In each the loss is tangible; the person deceived has made an irrecoverable payment or investment.
[5]At [36].
In three of the four transactions in issue on that appeal, the most the three vendors had lost was the difference between the sale price Mr Morley had contracted to pay and the lesser sales prices they achieved on resale. Those losses were expectation or loss of bargain losses not “criminalised by the section”.[6] Their property rights remained unaffected.[7] They lost only an expectation, recoverable in damages.
[6]At [37].
[7]At [47].
In the fourth case, by contrast, the vendor had, during the currency of her agreement with Mr Morley, entered into an unconditional contract to purchase another property. When he proved unable to complete the contract she had to sell her own property for $10,000 less than he had offered. She had also to pay $1,900 penalty interest on the purchase of her new property. The penalty interest was a tangible qualifying loss.
On that analysis, the loss Mr Moore suffered was an expectation loss, not contemplated by s 240(1)(d). He made no payment as a result of the deception he suffered; and, to the extent that it may be relevant, there was no evidence at trial that he lost any opportunity to carry out other work for an identifiable reward. At most he has a claim in damages.
Outcome
Consequently, we allow Ms Randell’s appeal against her conviction for this single offence and we quash her conviction. In the circumstances, we do not order a retrial. We do not, however, consider that the quashing of the conviction on that count should result in any reduction in her sentence.
This offence was only one of the 20 of which Ms Randell was convicted. Mr Moore’s unpaid fees were one quarter of the total losses suffered by all victims of the deception, but that was only one aggravating feature. Others were planning, premeditation, the four month span of the offending, and multiple breaches of trust.
Furthermore, Ms Randell could as readily have been charged with an offence under s 240(1)(a) and we only agreed not to substitute such a conviction because her defence had been conducted on the basis that the offence lay under s 240(1)(d). On any view, however, Ms Randell’s appeal against sentence is without substance and it is dismissed.
Solicitors:
Public Defence Service, Manukau for Appellant
Crown Law Office, Wellington for Respondent
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