Sio v R (Serious Fraud Office)
[2024] NZHC 1756
•1 July 2024
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
I TE KŌTI MATUA O AOTEAROA TĀMAKI MAKAURAU ROHE
CRI-2023-404-452
[2024] NZHC 1756
BETWEEN BETTY LEUINA SIO
Appellant
AND
THE KING (SFO)
Respondent
Hearing: 7 May 2024 Counsel:
N P Chisnall KC and L A Elborough for Appellant N E Walker and M Taumoepeau for Respondent
Judgment:
1 July 2024
JUDGMENT OF BREWER J
This judgment was delivered by me on 1 July 2024 at 3 pm
Registrar/Deputy Registrar
Solicitors/Counsel:
N P Chisnall KC | L A Elborough (Auckland) for Appellant Kayes Fletcher Walker (Manukau) for Respondent
SIO v R [2024] NZHC 1756 [1 July 2024]
Introduction
[1] On 29 March 2023, Ms Sio was found guilty by Judge Y Yelavich1 on two changes of dishonestly using a document.2
[2] On 16 August 2023, the Judge declined Ms Sio’s application to be discharged without conviction and fined her $3,000.3
[3] Ms Sio now appeals her convictions and, separately, the refusal to discharge her without conviction.
[4] The appeal against convictions is brought on the ground that the Judge erred in her assessment of the evidence to such an extent that a miscarriage of justice has occurred.4
[5]“Miscarriage of justice” is defined:
… means any error, irregularity, or occurrence in or in relation to or affecting the trial that—
(a)has created a real risk that the outcome of the trial was affected; or
(b)has resulted in an unfair trial or a trial that was a nullity.
[6] An appeal against a refusal to discharge without conviction is said to be an appeal against both conviction and sentence.5 In reality, an appellate Judge assesses whether the sentencing Judge erred in their application of the principles governing discharges without conviction to such an extent that a discharge without conviction should be entered.
Background
[7] Ms Sio was the Chief Executive of a charitable organisation called Pacific Island Safety and Prevention Incorporated (the Project). Her friend, Ms Uitime, was
1 SFO v Sio [2023] NZDC 774.
2 Crimes Act 1961, s 228(1)(b). The maximum sentence is seven years’ imprisonment.
3 R v Sio [2023] NZDC 17631.
4 Criminal Procedure Act 2011, s 232(2)(b).
5 Jackson v R [2016] NZCA 627.
the Operations Manager. The following passages, which I accept, are from the Crown’s submissions:
2.2The Project was established as a not-for-profit incorporated society on 17 October 1995. It later became a registered charity. Its aims and objects included “to provide a service to the greater Auckland community, in the area of prevention, education, counselling and development of the Pacific Island Community”.
2.3One of the Project’s rules was that its income and property had to be applied solely towards the promotion of the objects of the Society, except for payments in good faith of “reasonable remuneration to any officer or servant of the Society or to any members of the Society in return for a service actually rendered to the Society.”
2.4The Project described itself as a community development social service integrating cultural practices to enhance the well-being of communities. It offered a range of social support services. By 30 June 2014 it was receiving government funding of approximately
$2.5 million per year.
2.5By 2013 the accounting systems and processes at the Project were inadequate. There was no meaningful oversight or accountability in relation to the payment of invoices and the drawing of cheques. Ms Sio and Ms Uitime were able to co-sign and authorise cash cheques for any sum. There were no apparent ramifications if documentation that had been promised, for example receipts or invoices, were not provided.
[8] On 20 August 2013, Ms Uitime forged four invoices from fictitious suppliers. She then completed cheque forms and drew cash cheques in relation to the invoices. The cheques required two authorised signatures. Ms Uitime signed the cheques as one authorised signatory and Ms Sio signed them as another authorised signatory.
[9] Ms Sio took two of the cheques to the Sylvia Park branch of the BNZ on 21 August 2013. At 1.39 pm she cashed one of the cheques, receiving $34,700. At
1.41 pm she cashed the other cheque, receiving $9,050 (the Sylvia Park cheques). The total cash obtained by Ms Sio was $43,750.
[10] Less than half an hour after Ms Sio cashed the Sylvia Park cheques, Ms Uitime cashed hers. This time at a bank in Henderson. One cheque was for $13,350 and the other was for $22,900. The total cash received by Ms Uitime was $36,250.
[11]The total of the cash received from the four cheques was the round sum of
$80,000.
[12]The Crown summarises subsequent events of relevance:
1.4At 4:33 pm, three hours after cashing the Sylvia Park cheques, Ms Sio made a $3,000 cash deposit to her credit card account. In succeeding days she:
(a)went to the casino with Ms Uitime and lost $1,965 (22 August);
(b)made a further $2,000 cash deposit onto her credit card (24 August);
(c)made cash deposits of $10,000 and $2,000 into her bank accounts (26 August); and
(d)made a $600 cash deposit into a joint account she held with her mother (27 August).
[13] Ms Uitime pleaded guilty to charges of dishonesty relating to the forging of the invoices and the dishonest use of the four cheques, including the Sylvia Park cheques. Ms Sio was charged only in respect of the use of the Sylvia Park cheques.
[14] Accordingly, the focus of Ms Sio’s trial was whether the prosecution could prove beyond reasonable doubt that Ms Sio knew, when she used the Sylvia Park cheques, that they were fraudulent.
The Judge’s decision
[15] The Judge reviewed the evidence carefully and at length.6 I will not attempt to summarise it but will refer to the key issues advanced by the appellant. These are set out as follows:
5.As the Judge recognised, this was a circumstantial case. When assessing the strands of evidence available, the Judge made several errors that led to the wrong conclusion on the ultimate issue: whether the prosecution had proven the two charges beyond all reasonable doubt. Specifically, it is contended that the following factual and legal errors were made:
6 The judgment runs to 184 paragraphs across 51 pages.
(a)The Judge misused text messages sent between Ms Sio and Ms Uitime many months after the alleged offences were committed. As Ms Uitime was not called as a prosecution witness, this evidence was not admitted for the truth of its content, but rather for the sole purpose of assessing the truthfulness of Ms Sio’s statement to the SFO. The Judge failed to explain what weight she placed on Ms Sio’s supposed lie about when she became aware of her alleged co- offender’s fraudulent activity. The Judge did not grapple with the fact that if Ms Sio had told a lie on one topic in her statement, this did not automatically mean that everything she told the SFO was untrue. The Judge did not refer to the fact that many of the significant aspects of what Ms Sio said was corroborated by other evidence. More fundamentally, the Judge never squared up to the temporal disconnect between the date of the offending – in August 2013 – and, much later on, July 2014, which her Honour concluded was the earliest upon which Ms Sio would have become aware of her co- defendant’s offending. The Judge erred by using this finding about post-offence knowledge to bolster her conclusion that Ms Sio had the requisite dishonest intent at the time the offences were committed in August 2013.
(b)The Judge placed much weight on the bare fact that Ms Sio and her co-defendant were friends. The Judge inferred that the appellant must have known Ms Uitime had a gambling problem that required financial intervention, and that they must participated together at the casino the day after the funds were taken, 22 August, which provided both a motive for the fraud and an opportunity for Ms Sio to share her ill-gotten gains with Ms Uitime. The Judge did not sufficiently scrutinise the evidence, which made it unsafe to find that Ms Sio attended the casino on 22 August.
(c)A key plank in the defence case was that Ms Uitime, not Ms Sio, needed the money withdrawn on 21 August 2013, and was therefore the person who exclusively obtained the pecuniary advantage. In contrast, the Crown case hinged on Ms Sio requiring money, too. The Judge misapprehended the evidence of the forensic accountant called by the defence, David Osborn, when she held that, “I do not consider this calculation to have considered every known source of money available to Ms Uitime over this period of time”. The expert did consider every known source of money. This was in fact the essence of his evidence, which meant that the Judge reverted to speculation when she held that Ms Uitime did not require all of the money withdrawn to fund her gambling. The affirmation of Mr Osborn, which the appellant seeks to admit, affirms that the Judge factually errored.
(d)The Judge did not state that the prosecution was required to disprove that Ms Sio held a genuine and honest belief regarding her use of each of the documents. Rather, the Judge adopted an objective test, by treating the reasonableness of
Ms Sio’s state of mind as the proxy for whether the belief was actually held.
(e)The Judge erred in her assessment of the relevance of Ms Sio’s good character. In the circumstances of this case, Ms Sio’s alleged dishonesty was the antithesis of the way she ordinarily conducted herself, which is why the value of the evidence should not have been dismissed.
(f)The Judge erred regarding the weight placed on certain transactions as strands that supported the prosecution case.
(g)Finally, the Judge did not explain her reasons why the prosecution had provide the “without claim of right” element of the charges beyond a reasonable doubt. The SFO bore the onus of disproving that Ms Sio held an honest belief that she had a legal right to take or deal with the money obtained. The Judge’s total absence of reasons as to why this element was disproved beyond a reasonable doubt is an error in terms of both Sena v Police7 and Christian v R.8 Adopting what was said in Christian,9 it was a fundamental error that bore on Ms Sio’s right to a fair trial, and thus engaged s 232(4)(b) of the CPA.
[16] The appellant, helpfully, sets out the Judge’s key findings:
19. The Judge helpfully summarised her factual findings at [179] of the judgment. These submissions address the findings pertinent to each ground of appeal, but, for convenience, the Judge’s key findings will be set out now:
[179] In my view, there are a number of strands of evidence that, when considered together, lead me to the conclusion that Ms Sio cashed both cheques on 21 August 2013 knowing that the cash was not for legitimate suppliers or for the good faith remuneration of herself or Project employees. Those strands are the following:
(a)At the time that Ms Sio received the two cheques on
21 August 2013 from Ms Uitime, there was no meaningful oversight at the Project in terms of the invoicing and issuing of cheques.
(b)Ms Sio is likely to have signed the four cheques on the morning of 21 August 2013 when she met with Ms Uitime. It would be implausible to suggest that Ms Sio, as the CEO, signed the four cheques, and then received two of them to cash, without any enquiry with Ms Uitime about what the cheques were for. It is equally implausible to suggest that Ms Sio received two cheques that she had previously signed, both of those cheques now having been completed and signed
7 Sena v Police [2019] NZSC 55, [2019] 1 NZLR 575.
8 Christian v R [2017] NZSC 145, [2018] 1 NZLR 315.
9 At [112].
by Ms Uitime, without any enquiry as to what the two cheques (of a substantial value) were for.
(c)The circumstances surrounding the cashing of the cheques were unusual. There were two cheques being cashed, one being the highest value cheque that Ms Sio cashed at the Project during the period 2012 to 2015. In combination, the cheques were of a very high value and to walk out of a bank with $43,750 in the hand was not a common event, even by the Project’s standards.
(d)At 1.39 pm and then at 1.41 pm, the two cheques were cashed. Three hours later, at 4.33 pm, a cash deposit of $3,000 was made by Ms Sio into her BNZ credit card account at the Sylvia Park branch of the BNZ. There is no logical explanation for this cash deposit, other than that it was from the proceeds of the cheques cashed just hours earlier. I am satisfied beyond reasonable doubt that the $3,000 cash came from the proceeds of the cheques cashed earlier that day. This deposit is inconsistent with a suggestion that Ms Sio was unaware that the cheques she cashed were not for the legitimate suppliers of services to the Project, or for the good faith remuneration of herself or other Project employees.
(e)In my view, it is likely that Ms Sio used her casino card at the SkyCity casino on the night of 22 and 23 August 2013 at around the same time that her good friend and colleague Ms Uitime was gambling, using some of the proceeds from the cheques cashed on 21 August 2013. The loss to Ms Sio at the casino that night was $1,965. In reaching that conclusion I am mindful that $500 was withdrawn from a joint account that Ms Sio shared with her mother on 22 August 2013 but I note that this was not an account used exclusively by Ms Sio.
(f)I am also mindful that $300 was withdrawn from Ms Sio’s “46” account on 21 August 2013. While Mr Osborn gave evidence that withdrawals from Ms Sio’s bank accounts over the period 8 to 22 August 2013 totalled $2,400 and that this money might account for the source of the money used at the casino on the night of 22 August 2013, the timing of the casino visit so soon after the withdrawal of the cash, leads me to the conclusion that it more likely that the source of cash used at the casino came from the proceeds of the $43,750.
(g)I am also mindful of the evidence given by Mr Osborn’s calculations that, from his calculations of known cash available to Ms Uitime, Ms Uitime “needed” the $43,750 cashed by Ms Sio in order to fund her losses at the casino. His evidence was that during the period 21 August 2013 to 23 February 2014, Ms Uitime lost $105,262.30 at the SkyCity casino, whereas the total amount of offending in that period and the amount of cash available to Ms Uitime
equalled $110,262.30. I do not understand this calculation to have considered every known source of money available to Ms Uitime over this period of time, including for example any legitimate income or funds that she may have been receiving. Therefore, I consider that it is speculative to conclude that Ms Uitime “needed” the $43,750 cash to fund her casino losses and I note that, even on Mr Osborn’s calculations, Ms Uitime did not “need” all of the
$43,750 cash proceeds.
(h)Over the five days following 21 August 2013, Ms Sio deposited $2,000 cash into her credit card account and
$12,000 in cash into her personal bank account. These deposits are not linked to any Project expenses and it very likely that these cash deposits came from the proceeds of the cheques cashed by Ms Sio.
(i)The total sum of cash that Ms Sio was known to have had access to in the days following 21 August 2013 ($3,000, $1,965, $2,000 and $10,000) was close to
$17,000. In other words, close to half of the proceeds of the cheques that were cashed. Given that Ms Uitime created the invoices, the cheque receipt form and completed the cheques, it is probable that she also received a significant portion of the $43,750 cashed by Ms Sio.
[Footnotes in decision omitted]
The appeal against conviction
[17] As the Judge said, this was a circumstantial evidence case. There was only one essential element of the charges in contest: whether Ms Sio knew that the Sylvia Park cheques were fraudulent when she cashed them.
[18] An appeal against conviction is by way of rehearing. The appellate judge must make his or her own decisions on the issues. The appellant has the task of pointing to error. But, an appeal is not a re-trial and the appellate judge should bear in mind that the trial judge had the advantage of experiencing the evidence in person.10
[19] In a circumstantial case with many evidential strands and no fundamental error identified it is very difficult for an appellant to overturn a conviction. In this case, for example, there can be no suggestion that at the end of the evidence an application for discharge under s 147 of the Criminal Procedure Act 2011 would have succeeded.
10 In this regard, I do not think it is significant that Ms Sio’s trial switched from trial by jury to trial by judge alone with the evidence taken in the former being used, by consent, in the latter. Judge Yelavich presided throughout and saw witnesses give their evidence and be cross-examined.
Ineluctably, and taking the prosecution’s case at its highest, there was sufficient evidence on which the Judge, properly directed, could reasonably have convicted.
[20] Therefore, the appellant’s very difficult task in this case is to unpick the strands of the circumstantial evidence rope to show that the Judge gave them too much strength and, in fact and law, the rope was too weak to bear the weight of convictions. In other words, the Judge should have been left with a reasonable doubt as to Ms Sio’s guilt.
[21] The first ground of appeal relates to the Judge’s use of text messages between Ms Sio and Ms Uitime. The text messages were exchanged after the offending and were admitted (properly, I find) to enable the Judge to give proper weight to statements made by Ms Sio in her lengthy interview with the Serious Fraud Office.
[22]I adopt the prosecutor’s summary of the Judge’s use of the messages:
3.8Judge Yelavich began by reminding herself of Judge Grau’s ruling. She then set out the five exchanges she considered “most pertinent” to the trial. The messages are not set out here as they require the contextualisation provided in the reasons for verdicts, but in short the Judge found that:
(a)Ms Sio had sought to minimise Ms Uitime’s involvement in the Project’s finances at interview. The messages on 23 November 2013 (exhibit 36) were inconsistent with the suggestion that Ms Uitime did not have an ability or mandate to authorise payments from the Project's accounts and that “everything financial” went through Ms Brown or the accountant.
(b)The messages on 17 April 2014 (exhibit 39) were in direct contrast to Ms Sio’s claim that “she [i.e. Ms Sio] didn’t have anything to do with the finances” at the Project. They highlighted the degree of authority and control that Ms Sio had at the Project, including over financial matters. They also demonstrated that Ms Sio had “some dominance” over Ms Uitime and Ms Brown.
(c)The messages on 3 July 2014 (exhibit 34) undermined Ms Sio’s claim that she had no knowledge of money being cashed and used for non-Project related or personal purposes. In those messages Ms Sio and Ms Uitime had made light of Ms Uitime’s intention to cash a cheque in order to purchase shoes. Despite an initial attempt to dissuade, the overall tone of the exchange indicated that Ms Sio was amused by
Ms Uitime’s “naughty” behaviour (and ultimately she did not discourage it).
(d)The messages on 18 and 19 October 2014 (exhibit 41) were highly probative of Ms Sio’s knowledge of Ms Uitime's fraudulent use of Project money, especially in connection with gambling at the casino. They were in contrast with Ms Sio's claim that she had no knowledge of money being cashed and used for non-Project related purposes and she had no concerns about Ms Uitime using Project money to fund her gambling.
(e)The messages on 23 December 2014 (exhibit 35) further undermined the claim that Ms Sio had no knowledge of false invoices or other fraudulently created documents (those messages, in combination with SkyCity records and Project records, demonstrated Ms Sio’s knowledge of, and approval of, the use of false Project invoice/s to fund Ms Uitime’s gambling).
[Footnotes omitted]
[23] I do not accept the appellant’s criticism that the Judge failed to draw a distinction between what the text messages might indicate was Ms Sio’s knowledge of Ms Uitime’s dishonesty at the time the messages were exchanged and Ms Sio’s knowledge at the time she cashed the Sylvia Park cheques. The Judge directed herself in accordance with s 124 of the Evidence Act 2006. I accept the prosecution’s submissions:
3.10The submission for Ms Sio – that the Judge “uncritically” treated the lies as “proof” that she had been dishonest in August 2013 – bears no scrutiny. The Judge did not “summarily dismiss” innocent explanations for Ms Sio's lies; indeed, she indicated that “at least some of Ms Sio’s lies can be explained by her wanting to protect her good friend and colleague Ms Uitime.”
3.11The Judge was right to interpret the text messages, direct herself on lies generally, exercise some caution (by acknowledging the possibility that some lies could be explained as cover for Ms Uitime), and put the lies into the circumstantial mix. The implication of the submission for Ms Sio – that the Judge should have said something more conclusory about the lies on their own, rather than putting them into the circumstantial mix – is contrary to principle (and unsupported by authority) as it would have pre-empted the answer to the ultimate issue in the trial.
3.12Nor was the Judge required to say anything more about the possibility that Ms Sio only became aware of Ms Uitime’s frauds against the Project after she cashed the Sylvia Park cheques. The Judge was clear about not having any messages from August 2013, and there is nothing in her reasons to suggest she incorrectly treated the messages as direct proof of knowledge of Ms Uitime’s frauds.
3.13Ms Sio’s knowledge of Ms Uitime's wider offending against the Project as at 21 August 2013 was a key issue in the trial. Only an overall analysis of the whole body of evidence could answer it. That was clearly the basis on which the Judge approached the case.
[Footnotes omitted]
[24] In any event, it is well-established that the actions and words of a defendant after the charged offending can, if appropriate, be used to draw inferences as to their knowledge at the time of the alleged offending. In my view, Ms Sio’s attitude towards Ms Uitime’s use of the funds of the charitable organisation of which she was Chief Executive, might well found such inferences given that the relationship between the two had not changed.
[25] I find that the Judge’s examination and use of the text messages was careful, reasonable and open to her. For example:
[136] On 23 December 2014, just before 1pm, Ms Sio texted Ms Uitime “Sis. Mas here…Asking for you. Wants you to take her to casino…Hahaha.” Ms Uitime replied “Bring her to casino at 2pm I meet u both there.” At 1.03pm, Ms Sio texts “Sis. I’ve put in $4K bk into her account…Ummm need money.” Ms Uitime replies at 1.04pm “Yea well my $430 ain’t gona last long either?? Another invoice maybe? LOL!!” . Four minutes later, Ms Uitime texted “I’ll sort it c u n ma thur”. Ms Sio replied at 1:21pm “Yeah…Yayyyy!!!”
[137] Ms Uitime’s SkyCity card was used from 3.12pm to 9.54pm on 23 December 2014. Ms Sio’s card was used from 3.29pm to 7.25pm with a total loss of $2,065.00.
[138] There were two cheque withdrawals made from the Project bank account on 23 December 2014. The first was a cheque co-signed by Ms Brown and Ms Uitime for $30,000 and cashed by Eseta Illaoa, the second was similarly co-signed but cashed by Ms Uitime for $12,000. Both cheques were made out to cash.
[139] Ms Kincade points to transactions recorded on the ledger kept by Ms Brown in relation to the Project’s “25” account from 19 to 24 December 2014. The ledger records that on 19 December 2014, Ms Sio requested the transfer of $2,000 to her Westpac account. A transfer of $2,000 was made to Ms Sio on 23 December and, on 24 December 2013, Ms Uitime telephoned Ms Brown to say that Ms Sio needed $2,000 from her savings to be paid into Eseta’s account for a loan. Ms Kincade submits that I can infer that part of the text conversation (that is, the reference to “I will sort it) on 23 December 2014 can be explained by Ms Uitime agreeing to ring Ms Brown to arrange the transfer of $2,000 of Ms Sio’s own money into Eseta’s bank account. I do not find, however, that to be a plausible explanation for the text messages. In my view, Ms Uitime was indicating to Ms Sio that she would “sort” another false invoice.
[140] The only available inference that can be drawn from Ms Uitime’s reference to an “invoice” is that she was referring to a Project invoice. Ms Sio approves of Ms Uitime saying that she would “sort” another invoice. In my view, the exchanges further demonstrate Ms Sio’s knowledge of and approval of the use of false Project invoice/s to fund Ms Uitime’s gambling, and undermines Ms Sio’s claim, during her interview, that she had no knowledge of false invoices or other documents being created fraudulently.
[26] This ground of appeal does not demonstrate error on the part of the Judge.
[27] The second ground of appeal focuses on whether someone other than Ms Sio might have used her Sky City Casino Card on 22 to 23 August 2013.
[28] Ms Sio’s Casino Card was used from 11.45 pm on 22 August 2013 to 2.19 am on 23 August 2013. Losses totalling $1,965 were incurred. Ms Uitime used her card from 9.17 pm on 22 August 2013 to 2.56 am on 23 August 2013 and lost $6,890.
[29] The appellant points out that Ms Sio’s Casino Card was on occasion used by someone else (probably Ms Sio’s mother) and so the Judge should not have inferred that Ms Sio was gambling with Ms Uitime proximate to the date the fraudulent cheques were cashed.
[30] There is nothing in this point. The Judge concluded that Ms Sio was “more likely than not” the user of her card that night. After all, it was Ms Sio’s card and she and Ms Uitime were close friends. The Judge did not jump to a conclusion that the user of Ms Sio’s card was beyond reasonable doubt Ms Sio. This was, and the Judge treated it as such, a strand of circumstantial evidence.
[31] The third ground of appeal goes to the Judge’s treatment of the evidence of Mr Osborn, a chartered accountant called as a witness by Ms Sio. One of his suggestions was that Ms Uitime “needed” the amounts from the Sylvia Park cheques to fund her gambling.
[32]The Judge said:11
I am also mindful of the evidence given by Mr Osborn’s calculations that, from his calculations of known cash available to Ms Uitime, Ms Uitime
11 As quoted above at [16].
“needed” the $43,750 cashed by Ms Sio in order to fund her losses at the casino. His evidence was that during the period 21 August 2013 to 23 February 2014, Ms Uitime lost $105,262.30 at the SkyCity casino, whereas the total amount of offending in that period and the amount of cash available to Ms Uitime equalled $110,262.30. I do not understand this calculation to have considered every known source of money available to Ms Uitime over this period of time, including for example any legitimate income or funds that she may have been receiving. Therefore, I consider that it is speculative to conclude that Ms Uitime “needed” the $43,750 cash to fund her casino losses and I note that, even on Mr Osborn’s calculations, Ms Uitime did not “need” all of the $43,750 cash proceeds.
[33] I do not accept the appellant’s point that the Judge mischaracterised Mr Osborn’s evidence because he had considered every known source of money available to Ms Uitime. That was his evidence-in-chief. In cross-examination he eventually accepted that there were other cheques cashed which were not investigated (because they were for sums under $5,000) and there were cheques which could not be investigated because there was no supporting documentation.12
[34] The fourth point on appeal is the Judge’s approach to the mental element of dishonesty.
[35]The appellant submits:
59.The Judge correctly stated that s 228 of the Crimes Act incorporates the statutory definition of “dishonestly” – “without a belief that there was express or implied consent to, or authority for, the act or omission”.13 However, absent from the reasoning was articulation of the well-established legal principle that the belief of a defendant is a purely subjective test. As the Supreme Court emphasised in Hayes v R, the belief need only be genuinely or honestly, not reasonably, held.14 The Court said:15
The significance for present purposes of this history is that it is clear those who framed the new definitions did not seek to introduce any reasonableness qualification of the relevant beliefs. The beliefs contained in the definitions of “dishonestly” and “claim of right” were not meant to be subject to a reasonableness control, albeit their reasonableness will obviously have evidential relevance to the question whether they were actually held. It would in these circumstances be
12 Mr Osborn filed an affidavit in support of the appeal. I will not accept it in evidence because it is neither fresh evidence nor cogent evidence. It is his evidence at trial, tested in cross-examination, which is relevant.
13 At [15].
14 R v Hayes [2008] NZSC 3, [2008] 2 NZLR 321 at [43].
15 At [58].
wrong for this Court to read in a requirement that the beliefs referred to in the statutory definitions must be reasonable.
60.It is submitted that the failure to describe the relevant law is an important gap in the Judge’s reasoning. The Judge’s reference to “belief” is not properly qualified as being “genuine” or “honest”. This creates a real risk that the Judge’s approach implicitly used what was meant to be a “reasonableness control” as the test for honesty. Accurately stating the law was of critical importance in this circumstantial case in which the mens rea in relation to two transactions amongst many fell for consideration. The way that the reasons are expressed should leave this Court with a sense of disquiet that the Judge did not focus on whether there was a reasonable possibility Ms Sio’s belief that the invoices presented by Ms Uitime were legitimate was genuinely held, no matter how unreasonable that belief might seem with the benefit of hindsight.
[36] I do not accept these submissions. The Judge was required to make a finding about Ms Sio’s subjective belief at the time she cashed the Sylvia Park cheques. The Judge was not required to use any particular formulation such as “genuine belief” or “honest belief”. I accept the prosecution’s submission:
3.25 There is nothing in the Judge’s reasons to suggest the application of a “reasonableness control” or an objective test. The implausibility of Ms Sio not enquiring of Ms Uitime what the cheques were for was a compelling strand in the evidential rope. The Judge’s reference to that strand is not indicative of the application of a wrong legal test.
[37] The fifth ground of appeal relates to Ms Sio’s good character.
[38]The appellant submits:
63.The undisputed evidence before the Judge was that Ms Sio was of good character with a history of community involvement. The Judge said:
[175] … Witnesses described Ms Sio as hardworking and as being committed to the Project organisation which she had helped to set up. Ms Passells said that Ms Sio carried a lot of mana, that she was an “inspirational” leader and a “visionary”. Ms Kincade submits that I should give this evidence particular weight when considering whether Ms Sio is the type of person likely to have committed these offences. I understand Ms Kincade’s submission to be that I can find that Ms Sio is less likely to have stolen from the Project because of the significant role she had played in the Project’s success and because of her history of doing good, honest work that has been recognised and respected by her colleagues.
[176] I remind myself that, as a matter of logic, there is always a first time for everyone who has offended. However,
while evidence of good character is not in itself a defence, it is evidence that I am entitled to take into account and I do take into account.
64.With [176], the Judge effectively dismissed the value of the evidence given there was no explanation of how it was taken into account.
[39] The appellant submits further:
68.The importance of Ms Sio’s good character ought to have been factored in during the penultimate paragraph of the judgment. At [182], the Judge asked and answered a final question in the following way:
In reaching my findings, I have asked myself another question
– namely, is it reasonably possible that Ms Sio, the CEO of the Project, received two cheques from Ms Uitime on the morning of 21 August 2013, having pre-signed those cheques before 21 August 2013, with a belief that the proceeds of the cheques were for Project suppliers, and then coincidentally deposited into her credit card account that same day, $3,000 in cash, followed by a further $14,000 cash being deposited into her accounts later that week. I do not find that scenario to be a reasonable possibility and I accordingly reject it.
69.What was missing from this step-back was the Judge’s consideration of the plausibility (or rather implausibility) of Ms Sio committing two discrete large-scale offences in order to help her friend and because the “temptation of easy cash” was so great that she put aside her loyalty to the Pasifika organisation that she had dedicated over two decades to. Had this happened, it is submitted that the Judge would have been left with a reasonable doubt. This was an error that resulted in a miscarriage of justice.
[40] I do not accept the appellant’s submissions.
[41] The Judge clearly factored Ms Sio’s good character, and her role in the Project, into her decision-making. The weight she gave it, in all the circumstances, was for her. Certainly, the Judge did not have to give Ms Sio’s good character the special weight contended for by the appellant. The annals of the Courts are populated by cases involving the criminal downfalls of people with hitherto unimpeachable character. It is trite to say it, but the Judge had to consider Ms Sio’s character against all the other evidence in the case. Including the duration and nature of her friendship with Ms Uitime, her interview with the Serious Fraud Office and the text messages.
[42] The sixth ground of appeal alleges the Judge misapprehended the unusualness of the circumstances surrounding the cashing of the cheques:
70.At [146], which is carried through in to [179](c), the Judge developed the idea that there were unusual features to the circumstances relating to the two cheques.
71.The Judge found that the transactions ought to have been memorable to Ms Sio, but she said they were not. This was used to bolster the conclusion that Ms Sio had lied in her SFO interview. It was the amounts involved that the Judge treated as their distinguishing feature, “one being the highest value cheque that Ms Sio cashed at the Project during the period 2012 to 2015. In combination, the cheques were of a very high value and to walk out of a bank with $43,750 in the hand was not a common event, even by the Project’s standards”.16
72.However, the evidence showed that the circumstances were not outside the ordinary for the Project, given its lackadaisical financial arrangements and absence of records. Ms Sio’s lack of recall was explainable by the fact that she was being asked to provide an explanation four years after the event. In essence, the fact that others who signed cheques were not charged, whereas Ms Sio was, hinged on the size of the two cash withdraws that she personally made on 21 August. This leaves the strong impression that the appellant was penalised for being negligent.
73.Nor did the Judge square up the plausibility of the idea that Ms Sio was prepared to risk being apprehended for dishonestly cashing the largest amount that she had ever dealt with at the Project. The high reward carried a significant risk of apprehension.
74.Undercutting the Judge’s reasoning is a piece of evidence that received little scrutiny. Ms Sio commonly incurred substantial personal expenses that were then reimbursed. For instance, it was undisputed that the highest value cash cheque drawn on Project funds was $67,869.80, on 19 August 2013, to reimburse Ms Sio for flights.17 This ought to have been weighed in the mix, but was not.
75.Accordingly, the conclusion that these two cheques must have stood out due to their value is dubious.
[43] I do not accept those submissions. I do accept these submissions of the prosecution:
3.30The lax cheque-cashing culture at the Project is undeniable, but that cannot explain away the unprecedented nature of Ms Sio’s withdrawal on 21 August, nor the significance of the $3,000 cash deposit in her BNZ credit card account three hours later at the same location:
(a)As for the withdrawal, the basic facts remain stark. According to the available evidence, Ms Sio only ever cashed 13 cheques (some of which she could recall). She had never cashed any cheques at Sylvia Park. She had never cashed two cheques
16 At [179](c).
17 NOE 29, exhibit 23
within minutes of each other. And she had never received such a large amount of money in total. The Sylvia Park cheques must have stood out.
(b)As for the deposit, there can be no serious suggestion that it was “equally plausible that this was a legitimate discrete payment figure that lacked supporting documentation.” The probative value of Ms Sio depositing $3,000 cash at the same location she had obtained $43,750 (in cash) three hours earlier is obvious.
[44] The Judge was careful and thorough in her analysis:
[163]Ms Sio’s credit card account shows deposits of a similar value to
$3,000 having previously been made. These include deposits of $1,800 on 8 July 2013, $2,000 on 10 July 2013, $4,000 on 15 July 2013, $3,596 on
9 August 2013, $3,740 on 13 August 2013, $2,807.52 on 15 August 2013,
$592 on 19 August 2013, $67,869.80 on 19 August 2013, $2005 on 20 August
2013, $3,600 on 28 August 2013, $5,044 on 5 September 2013, $15,180 on
11 October 2013 and $3,000 on 29 October 2013.18 Each of these deposits were made by Project cheques made out to cash, aside from the deposit for
$592 which was by internet transfer.19 While some of these payments were identified as reimbursements for airline and hotel expense, the $3,000 cash deposit on 21 August has not been cross-referenced to any particular Project expense.20
[164] There are other deposits made into Ms Sio’s credit card account that have not been directly linked to the Project. These include deposits of $3,000 on 1 July 2013, $3,000 on 4 July 2013, $3,000 on 6 August 2013 and $2,220 on 15 August 2013. I am unaware whether these deposits were made in cash or by other methods, or the source of these deposits.
[165] Turning back to 21 August 2013, there was a three-hour gap between the withdrawal of the $43,750 cash and the deposit of $3,000 in cash and I do not have any evidence as to Ms Sio’s whereabouts over that three-hour period. However, given the timing and the amount of that deposit, I am satisfied beyond reasonable doubt that the $3,000 deposit made into Ms Sio’s credit card came from the $43,000 cash proceeds.
[45] The Judge was entitled to draw inferences from the circumstances in which the cheques were created and used. The circumstances would include Ms Sio, as Chief Executive of a charitable organisation, signing cheques totalling $80,000 made out to fictitious organisations. So, Ms Sio had never heard of these organisations and was apparently uncurious as to what they did for the Project to merit the payments.
18 Exhibit 28; Exhibit 29, p 4.
19 Brayden McCullough, NOE JAT, p 23.
20 For example, the deposit of $1,800 was a reimbursement for a Novatel expense and the deposits of $67,869.80 and $2,005.00 were reimbursements for Flight Centre expenses.
[46] The seventh ground of appeal is that the Judge failed to give reasons why the “without claim of right” element of the charges was proved beyond reasonable doubt.
[47]The Judge said:
[18] Ms Sio has not advanced a claim of right defence. The defence did not claim that Ms Sio had a lawful right to the cash received and I am satisfied beyond reasonable doubt that she did not.
[48] The appellant’s submission is that “claim of right” refers to a belief that the act is lawful, even if the belief is mistaken. It is submitted:
88. Applied in the instant case - even if the Project had not authorised the withdrawals on 21 August, Ms Sio was entitled to acquittal so long as there was a reasonable possibility that she believed – based on a mistake of fact or law – that the withdrawal was permissible.
[49] I do not accept those submissions.
[50] Of course, the prosecution had to prove beyond reasonable doubt that Ms Sio cashed the Sylvia Park cheques “without claim of right”. But the prosecution case was that Ms Sio acted dishonestly because she knew the cheques were fraudulent. There was no evidential foundation for a claim of right and so the Judge was entitled to treat that element summarily.
[51] I have now addressed each of the separate grounds of appeal going to error on the part of the Judge. I have not found error. But, it is still necessary to stand back and assess whether the strands of circumstantial evidence identified by the Judge collectively have the strength to bear the weight of convictions. I find that, palpably, they do. Overall, the evidence is of a respected and long-serving Chief Executive of a charitable organisation who allowed a culture of laxness to develop over accounting for the public funds donated to the charitable organisation. Ms Sio had unchecked authority – along with Ms Uitime – over the use of the Project’s funds. There is an available inference, in all the circumstances, that when Ms Uitime put the four cheques before her for signing that Ms Sio knew they were fraudulent. But, she went along with it anyway. Her motive might well have been to help Ms Uitime who needed money to pay for her gambling.
[52] The Judge was entitled to take account of the evidence that subsequently Ms Sio made cash deposits into her accounts and lost almost $2,000 at the Casino at the same time as Ms Uitime was gambling there.
Decision on appeal against conviction
[53] I conclude that the Judge did not err in her assessment of the evidence to such an extent that a miscarriage of justice has occurred.
[54]The appeal against conviction will be dismissed.
The appeal against sentence
[55]The sentencing took place on 16 August 2023.
[56] Judge Yelavich first assessed the gravity of Ms Sio’s offending as being moderate to serious. The Judge considered there are three particular aggravating features:
(a)The loss to the Project of $43,750 of government funding originating from the taxpayer. The Project was shut down as a result of the offending by Ms Sio and Ms Uitime with a consequential loss of employment and the loss of assistance to others. This factor was found to be “a moderately serious aggravating feature of your offending”.
(b)Abuse of position of trust as the CEO of the Project. The Judge regarded this as the most serious aggravating feature of Ms Sio’s offending.
(c)Some of the proceeds of the Sylvia Park cheques were retained by Ms Sio for her personal use. The Judge was satisfied beyond reasonable doubt that at least $3,000 were retained “and likely significantly more”.
[57]The Judge then considered Ms Sio’s mitigating features:
(a)The offending was “one-off” with no repetition over a period of 10 years.
(b)Ms Sio has no previous convictions. Her previous good character is a significant personal mitigating feature. The offending was out of character and, despite Ms Sio’s continued denial of the offending, she has good prospects of rehabilitation. The Judge went on to say:
[34] I must also recognise your tireless service to the community and give you credit for that. In brief, you have dedicated your life’s work to the Pasifika community. At the age of 19, you set up the Pacific Island Women’s Project Aotearoa in Wellington. You have been committed to the best outcomes for your community in terms of them accessing social services and healthcare spaces. You have worked to provide counselling, family support, social work support, family therapy, women’s survivor groups, Stopping Violence programmes, and more to your community.
[35] You are committed to social justice and are a highly- respected activist and role model to women and the LGBTQ community. I have read 33 letters of support. The majority of the letters are from people who are supporting you in court today. I acknowledge their presence today, and I note your supporters include family members, some of whom have travelled from as far away as China. I acknowledge their presence today and the support and strength they have provided to you throughout this prosecution, the trial, and the sentencing hearing.
[36] There are support letters from a wide-ranging group of people, including the principal of your high school which you attended over 40 years ago, letters from Professors and other academics, a letter from a former Member of Parliament and many others who attest to your good character. I accept your lawyer’s submission that the letters are exceptional, both in terms of the calibre of the writers and the contents of the letters. The letters refer to your commitment to your community and a number also describe the anxiety and grief that you have undergone over the past few years as a result of this investigation and prosecution, a matter I will come back to later.
[58] Taking into account those personal mitigating features, the Judge reduced the assessed gravity of the offending from “moderate to serious” to “moderate”.
[59] The second step in the evaluation process was to identify the direct and indirect consequences to Ms Sio of a conviction:
[38] I turn now to identify the direct and indirect consequences of a conviction. Six consequences have been identified. They are the impact on your employment prospects, the impact on travel, the impact on your reputation, family consequences, the impact on your wellbeing and mental health and finally, the impact on persons and organisations associated with you.
[60] The Judge referred to Ms Sio’s affidavit in which she said she has not been able to register as a social worker because of the charges, and this will continue if there is a conviction. The Judge pointed out that there is no evidence that a conviction will be a bar to gaining a social work registration and accordingly regarded that consequence as speculative.
[61]The Judge said:
[43] It is apparent from the information before me that your employment has been severely impacted as a result of the investigation commencing, the Project being closed down, and prosecution action being taken. This impact, however, is a direct consequence of your offending and Ms Uitime’s offending.
[44] Ms Kincade submits on your behalf that a conviction will further reinforce that loss of influence and make gaining work even more difficult for you in the future, and she cites by way of example, that employment by government departments and within any government advisory board would be out of the question if a conviction was entered. However, on the material before me, I am not satisfied that a conviction, as opposed to the finding of guilt that has been made, would have the stated impact on your future employment and/or work prospects. I consider there is insufficient evidence for me to conclude that there is a real and appreciable risk of such a consequence, as a result of the entry of convictions.
[62] Ms Sio raised fears that convictions would detrimentally affect her plans to travel to China, the Caribbean and Samoa. The Judge said:
[47] It is not always the case that travellers with criminal convictions are disbarred from travelling to their intended destination. There is no evidence before the Court to show that you will be prevented from travelling to any country on account of your convictions. I anticipate and acknowledge it may make things less straightforward, and there may be additional interviews and/or costs incurred. However, whether, and to what extent, there would be an impact on your ability to travel in the future is speculative.
[63] The third consequence identified was damage to reputation. The Judge said:
[48] I turn to the consequences to your reputation. I accept that your reputation generally has already been damaged as a result of the prosecution
action, although I note that you still have considerable support within the community. However, the damage to your reputation is a consequence of the investigation and of your offending. While regrettable, your personal and professional reputation has been impacted by the media reports that have followed this prosecution and, in my view, any further impact would be attributable to the offending itself.
[49] Given your lifelong service to the Pasifika community, it comes as no surprise that you have previously been given the honour of two Samoan matai titles, a privilege that is almost unheard of for New Zealand-born Samoans. Both are prestigious matai titles, one from your mother’s village in Samoa and one from your father’s village.
[50] While you may feel a sense of shame and whakamā as a result of these proceedings, I do not have any evidence before me to support the submission that you would be required to step down from those titles, particularly given your otherwise distinguished service. Neither do I have anything before me to explain why that would be a necessary response to a conviction, rather than to offending or a finding of guilt. I cannot place any real weight on that suggested consequence.
[64] The Judge accepted that Ms Sio’s mental health has been impacted by the prosecution, and this may continue.
[65] The Judge did not place weight on the consequence that people and organisations associated with Ms Sio would be impacted adversely if she were convicted. The Judge commented that all the material before her shows that notwithstanding her offending Ms Sio is still held in high regard.
[66]The Judge went on to say:
[53] In considering the impact on your reputation, family, wellbeing and health, I have had to assess whether these factors are the consequences of offending or the consequence of conviction. It is apparent from what I have said that I regard them largely as a consequence of your offending, the prosecution that has been brought, and the finding of guilt, as opposed to conviction.
[54] Notwithstanding those comments, I accept that the entering of a conviction will heighten the impact of some of the identified consequences. For example, a conviction may reinforce the stigma and adverse effects to your reputation. It may also impact more severely on your family and may exacerbate the risk to your wellbeing and mental health, at least in the short term.
[55] These are impacts that are not unexpected, given the high position of authority that you were previously in and the nature of the offending. I do not consider, however, that these consequences reach the threshold where it could be said that they are out of all proportion to the gravity of the offending. The
offending was serious, involving as it did the misuse of public funds in the context of a serious breach of trust and while the offending is mitigated as a result of your previous good character, I still regard it as offending within the moderate range in terms of its gravity.
[67] Accordingly, the Judge declined to discharge Ms Sio without conviction.
The appeal
[68]The appellant submits:
100.It is contended that Judge Yelavich made material errors in her analysis under s 107 of the Sentencing Act 2002. First, it is submitted that the Judge mischaracterised the offending “as being of moderate to serious gravity”.21 Counsel rely upon the following:
(a)The Judge did not put any weight on the defence submission that when the Project closed in 2015, Ms Sio was owed around
$26,000 in the 025 account, and that the monetised value of her leave entitlement was about $30,000. The Judge’s finding that “is not a justification for taking the money to which you were not entitled, nor is it a mitigating factor”,22 failed to appreciate that, even if Ms Sio’s very limited offending did contribute to the Project’s closure, her own losses were significantly greater than the $3000 the Judge held that she took for personal use.
(b)The Judge’s conclusion that “it was the financial irregularities plus your offending and Ms Uitime’s offending that effectively led to the end of the Project organisation” was treated as a “moderately serious aggravating feature”.23 Given the modesty of Ms Sio’s offending, it is difficult to defend that conclusion.
[69] The Judge is also criticised for breaking the first step of the assessment into two parts – assessing first the gravity of the offending and then assessing the personal mitigating factors to decide the overall gravity. The submission is that had all factors been assessed together the overall gravity should have been “low” or “low to moderate”.
21 At [31].
22 Sentencing decision at [26].
23 Sentencing decision at [28].
[70] The submission on the second step is that the Judge erred in considering the identified consequences individually and not collectively. It is the overall weight of the consequences which must be considered in the disproportionality assessment.
[71] The appellant further submits that the Judge erred in finding that a conviction would not add to the findings of guilt when considering future employment. That, it is submitted, is axiomatically wrong.
[72] The appellant relies on the affidavit of Ms Pipi filed in support of the appeal. Ms Pipi deposes that in late 2023 she nominated Ms Sio to be a paid participant in a hui for people working in the field of sexual violence. Ms Pipi deposes:
5. On or around 31 August 2023 I was rung by Don Matheson, Deputy Director General, Public health and primary care transformation from the Ministry of Health. Don rung to say that they had concerns about Betty’s participation in the forthcoming gathering. He said that they take into account the participant's history, including reports of criminal activity, and based on this it would not be wise for her to participate. He asked that I let Betty know that she could not attend the meeting. This is confirmed in an email from him this year when I asked him to clarify the reasons why Betty could not attend, at annexure “B”. While this could have been because of the publicity, the timing strongly suggests that this was because of the conviction.
[73] I will receive the affidavit as having relevance to the appeal.
[74] Finally, it is submitted that the Judge failed to take into account that a conviction is itself a serious consequence.
Discussion
[75] The issue for me is whether the Judge was entitled to find that the consequences of conviction for Ms Sio were not out of all proportion to the gravity of her offending.
[76]It is important to emphasise that the test is not one of simple proportionality.
[77] In my view, the Judge was correct to identify the breach of trust by Ms Sio as the greatest aggravating feature of her offending. Ms Sio assisted Ms Uitime to defraud the Project, a charitable organisation funded by the government, and this contributed to the Project being shut down. I agree with the Judge’s overall assessment
of the gravity of the offending as moderate. But, as I will come to, it does not matter if it is low to moderate.
[78] I agree also with the Judge that much of the burden of the direct and indirect consequences of conviction for Ms Sio comes from the finding of the Court that she is guilty of the offending. I do not read Ms Pipi’s affidavit as refuting this finding, and indeed it supports it.
[79] But, assume I am wrong and the overall gravity of Ms Sio’s offending is low to moderate and the collective burden of the entering of convictions is moderate. That would not make the consequences out of all proportion to the gravity of the offending.
[80]I see no error on the part of the Judge.
Decision
[81]The appeal against conviction is dismissed.
[82] The appeal against the refusal of the Judge to dismiss Ms Sio without conviction is dismissed.
Brewer J
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