Scanlon v R

[2013] NZCA 502

IN THE COURT OF APPEAL OF NEW ZEALAND

CA242/2013
[2013] NZCA 502

BETWEEN	LINDA DOREEN SCANLON Appellant
AND	THE QUEEN Respondent

Hearing:	14 October 2013
Court:	White, Venning and Andrews JJ
Counsel:	S G Vidal for Appellant H W Ebersohn for Respondent
Judgment:	18 October 2013 at 10.30 am

JUDGMENT OF THE COURT

AThe appeal against sentence is allowed.

BThe reparation order is quashed and replaced by an order that the appellant pay reparation of $13,000 at $50 a week, as from the appellant’s release from prison.

_________________________________________________________________

REASONS OF THE COURT

(Given by Andrews J)

Introduction

1. On 18 March 2013 the appellant was sentenced by Judge J A Farish in the District Court at Invercargill, after pleading guilty to 330 counts of dishonestly using a document.[1]  The appellant was sentenced to two years, three months’ imprisonment and ordered to pay reparation of $138,172.77 at $50 a week, as from her release (“the reparation order”).

   [1]R v Scanlon DC Invercargill CRI-2011-025-2319, 18 March 2013.

2. The appellant has appealed against the reparation order, on the grounds that it will result in undue hardship for her, and that the Judge failed to take her financial circumstances into account when making the order.  The appellant seeks an order quashing the reparation order.

Facts

1. In late 2005, the victim (“V”) asked the appellant to assist him to complete paperwork for a loan application, which she did.  Later, V asked her to help him complete tax returns for his business.  The appellant agreed to do this, and was given authorisation to deal with V’s bank accounts and internet banking facilities.  The appellant later obtained a cheque book for one of V’s accounts, without his knowledge.

2. Between December 2006 and June 2010, the appellant obtained $138,172.77 from V’s accounts, by using internet banking transactions or cheques to transfer money into her own account.

The reparation order

1. The Judge observed, on the basis of a budget set out in the pre-sentence report, that the appellant’s ability to repay V was “very limited”, in that after payment of loans and certain personal costs, the appellant had “no other money left over in terms of that income”.  The Judge considered, however, that “some money needs to go back to [V]”, who had not only lost the amounts taken by the appellant, but had also become liable for penalties and interest payable because of unpaid tax.[2]  The Judge acknowledged that it was unlikely that the reparation order would be paid in full,[3] but ordered that the appellant pay reparation of $138,172.77 at $50 a week as from her release from prison.  The Judge further ordered that the reparation order was to be reviewed six months after the appellant’s release, to see whether payments could be increased.[4]

Appeal submissions

[2]At [9].

[3]At [14].

[4]At [21].

1. We record that in his submissions for the Crown filed in advance of the hearing, Mr Ebersohn acknowledged that the reparation order, which required, in effect, a payment period of 53 years, was inappropriate and should be reduced.  Mr Ebersohn submitted that an appropriate reparation order would be for the appellant to pay a total of $13,000, by payments of $50 a week for five years. 

2. For the appellant, Ms Vidal submitted that a reparation order of $13,000, payable at $50 a week, would still cause undue hardship for the appellant.  She submitted that, because of her convictions, the appellant will not be able to obtain employment on her release, and that a payment of $50 a week would be a reduction of about 20 per cent from the “subsistence level” of income from a benefit.  She submitted that the reality is that any order other than one for payment of a nominal sum would cause undue hardship and that, therefore, an order should not be made.

3. Mr Ebersohn submitted that it was by no means certain that the appellant could not obtain employment.  He accepted that the appellant’s convictions would present an impediment to her obtaining employment but submitted, by reference to the many references and letters of support put before the Judge at sentencing, that the appellant has a great deal of community support.  He submitted that, with that support, the appellant may be able to overcome the impediment to employment.  Mr Ebersohn submitted that a reparation order in the proposed terms is appropriate, and not uncommon in similar circumstances.

Discussion

1. Section 12 of the Sentencing Act 2002 required the Judge to order reparation unless she was satisfied that the order would result in undue hardship for the appellant.  Section 35 of the Act provides that if the offender has insufficient means to pay the total value of the victim’s loss, the court may order reparation for a lesser amount, or order payment by instalments, or both.  In its judgment in R v Pender, this Court observed that:[5]

   Section 35 provides the sentencing Judge with flexibility to tailor the sentence of reparation to meet the financial capacity of the offender.  The sentencing Judge should have a realistic measure of confidence that the payment can be made: …

   (References omitted.)

   [5]R v Pender [2007] NZCA 465 at [15].

2. We accept that the Judge in this case did not have a “realistic measure of confidence” that the reparation payments could be made.  That is clear from the Judge’s comments, referred to earlier.  We also accept, however, that a reparation order should be made in this case.  We do not accept Ms Vidal’s submissions to the contrary.

3. The issue, then, is whether an order should be made in the terms suggested by Mr Ebersohn.  On that issue, we must consider whether we are satisfied that such an order would result in undue hardship for the appellant.  In Pender, this Court said regarding the assessment of “undue hardship”:[6]

   It will almost invariably be the case that there is some hardship for those ordered to pay reparation; as there is almost invariably hardship for those who are the victims of the offending that gives rise to the financial loss in respect of which reparation is required.

   [6]At [28].

4. We accept that a reparation order requiring the appellant to pay $50 a week for five years is likely to cause the appellant hardship, but the hardship must be “undue” before it would not be appropriate to make an order.  Whether hardship in this case is “undue” is likely to depend on whether the appellant is able to obtain work on her release, and how she spends her income.

5. At this stage, consideration of these matters is necessarily speculative.  However, there is force in Mr Ebersohn’s submission that the significant level of support that is evident in the references and letters provided at sentencing indicates that the prospect of the appellant obtaining work cannot be excluded.  In the circumstances, and bearing in mind the hardship suffered by V as a result of the appellant’s offending, we cannot accept that an order to pay $50 a week for five years will cause undue hardship for the appellant, so as to preclude a reparation order being made.

6. We also note that, should the appellant not be able to sustain payments of $50 a week (in the event that she cannot find employment on her release, and her income is not enough to avoid undue hardship) the appellant can make an application to the Court to review the order, pursuant to s 38A of the Sentencing Act.

Result

1. The appeal is allowed.  The reparation order is quashed and replaced by an order that the appellant pay reparation of $13,000 at $50 a week, as from the appellant’s release from prison.

Solicitors:
Crown Law Office, Wellington for the Respondent