Taniwha v Police HC Palmerston North CRI 2010-454-11

[2010] NZHC 1094

IN THE HIGH COURT OF NEW ZEALAND PALMERSTON NORTH REGISTRY

CRI-2010-454-11

NADINE JACQUILINE TANIWHA

v

NEW ZEALAND POLICE

Hearing:         12 May 2010

Appearances: Ms Simon for appellant

Mr Murray for respondent

Judgment:      29 June 2010

JUDGMENT OF MALLON J

Introduction

[1]      Ms Taniwha appeals against a reparation order for US$82,000.   That sum was to be converted into New Zealand dollars and subject to adjustment in light of recoveries  made  under  a  civil  proceeding.    The  reparation  order  was  part  of Ms Taniwha’s sentence on a charge of obtaining by deception (s 240(1)(a) Crimes Act 1961).  The appeal is out of time.  An application for leave to appeal out of time

is not opposed.

TANIWHA V NEW ZEALAND POLICE HC PMN CRI-2010-454-11  29 June 2010

[2]      The  offending  took  place  in  2007.    Ms  Taniwha  and  her  co-offender, Mr Saphire, set up a business from their home which advertised on the internet the sale of electronic goods.  Through that business Ms Taniwha and Mr Saphire agreed to supply iPhones to Wui Shun Trading Company, a Hong Kong company.  Pursuant to the arrangements reached, Wui Shun Trading Company transferred US$82,000 to Ms  Taniwha  and  Mr  Saphire.    No  iPhones  were  supplied.    Ms Taniwha  and Mr Saphire  were subsequently apprehended  at  Auckland  airport  where  they had intended to board a plane bound for Singapore.

[3]      Following a guilty plea Ms Taniwha was convicted on a charge of obtaining by deception.   She was sentenced on 3 June 2009.   There were two other, comparatively minor, associated charges on which Ms Taniwha was convicted and discharged.  In relation to the deception charge Ms Taniwha was sentenced to a term of  imprisonment  of  one  year  and  nine  months  with  leave  to  apply  for  home detention.  As to reparation the District Court Judge said this:

I am going to make the reparation order as is sought even though I am conscious that part of it has been satisfied.  The extent to which is not yet ascertained.  The gross balance is $82,000 in US dollars but if I make the order for payment in US dollars it will be the amount of the payment at the time of the payment or payments themselves less of course the figures that have been recovered through the civil action that has been taken by the legal representatives in New Zealand of the Hong Kong victims.  The repayments and as to the actual payments of the balance of the reparation will be as directed by the Collections Unit of this Court on the defendant’s release.

[4]      Mr Saphire was convicted on a charge of money laundering.  On his guilty plea to that charge, the charge of obtaining by deception was withdrawn.  Mr Saphire was initially sentenced to home detention but this was later varied to imprisonment because of a breach of his home detention sentence.   Reparation was not sought against him, and nor was it ordered.  The respondent advises that this was because it had already been ordered in full against Ms Taniwha.

[5]      Prior to the sentencing of the two offenders, Wui Shun Trading Company had obtained judgment by default against Ms Taniwha, Mr Saphire and another party said to be involved in the business.   The default judgment was for US$84,000,

interest on that sum at a daily rate of US$25.32 from 10 December 2007, US$30,000 for damages, and NZ$6,631.13 for costs and disbursements.  A further NZ$30 was ordered for the costs of a certificate of judgment.

[6]      In  the   civil  proceedings  Wui  Shun  Trading  Company  also  obtained restraining orders against bank accounts in the name of Mr Saphire up to a maximum amount  of  NZ$200,000.     Orders  were  also  obtained  requiring  Ms  Taniwha, Mr Saphire  and  the  other  party  to  disclose  their  assets.     Through  garnishee proceedings Wui Shun Trading Company obtained NZ$134,825.35 from the bank accounts.   This left NZ$118,147.29 outstanding under the  civil judgment.   The respondent advises that “the moneys recovered have been applied only in part to the judgment debt and in part to satisfy other, equally pressing civil debts” and that, as a result, the outstanding NZ$118,147.29 is made up of NZ$25,673.56 of the judgment debt and NZ$57,388.43 of the damages on the judgment debt.

Submissions

[7]      The appeal was initially brought on the basis that the Court ought not to have made  any  reparation  order  without  information  as  to  Ms  Taniwha’s  financial position, that she was not in a financial position to pay any reparation and the Court should now quash the reparation order because the practical reality is that she cannot meet it.   After the position with the civil proceeding was clarified, counsel for Ms Taniwha also submitted that the initial sum obtained by deception has already been recovered by the civil proceeding and no reparation order should be made under the criminal jurisdiction for the additional ancillary amounts awarded and recoverable under the civil proceeding.

[8]      The respondent agreed that the reparation order ought not to have been made against  Ms  Taniwha  without  information  as  to  her  financial  position.     The respondent submitted that reparation should now be ordered only in respect of the NZ$25,673.56 outstanding in respect of the judgment debt.  It submitted that in light of Ms Taniwha’s financial position weekly payments of reparation could be ordered.

[9]      Reparation may be imposed if an offender has “through or by means of an offence” caused a person to suffer loss of property or loss consequential to loss of property (s 32(1) of the Sentencing Act 2002).  In determining whether a sentence of reparation  is  appropriate  or  the  amount  of  reparation  to  be  made  for  any consequential loss the Court must take into account whether there is a right available to the person who suffered the loss to bring proceedings in relation to that loss (s 32(3) of the Sentencing Act).

[10]     A court considering a sentence of reparation may order that a reparation report be prepared on various matters.  This can include the financial capacity of the offender, the maximum amount that the offender is likely to be able to pay under a sentence of reparation and the frequency and magnitude of any payments that should be required (s 33 of the Sentencing Act).  This information is relevant because if an offender has insufficient means to pay the total value of the loss the court may sentence the offender to make reparation less than the total loss and/or to pay by instalments (s 35 of the Sentencing Act).  This information may also be relevant to whether a reparation order would result in “undue hardship” making it inappropriate to order reparation (s 12 of the Sentencing Act).

[11]     In this case the Judge intended to order reparation be made by Ms Taniwha up  to  a  maximum  of  US$82,000  (being  the  sum  obtained  by  deception). Ms Taniwha caused Wui Shun Trading Company to suffer this loss through or by means of an offence and so it was a sum for which a reparation order could be made. The Judge intended that the reparation sum would be US$82,000 less whatever sum had been recovered in the civil proceeding.  The Judge therefore took into account, as he was required to do, that Wui Shun Trading Company had a right to recover the sum in civil proceedings.

[12]   As it happened Wui Shun Trading Company had recovered more than US$82,000 in the civil proceedings.   It is unclear why the sum recovered by Wui Shun Trading Company was not wholly applied to the US$82,000 (the respondent refers to other pressing civil debts but has no further details).   Had it been, the

US$82,000 would have been repaid in full, leaving approximately NZ$30,000 available to be applied towards the additional amounts that made up the civil judgment (on the basis that $US82,000 converted to NZ$105,409.14 when it was deposited by the offenders into their bank accounts).   The Judge did not order reparation in respect of these additional amounts.

[13]     In these circumstances I consider that it is not appropriate to proceed on the basis that there remains NZ$25,673.56 owing on the judgment debt of US$82,000, merely because that is how Wui Shun Trading Company has applied the recovered funds.   The reparation order on its terms was for US$82,000 less the amount recovered in the civil proceedings.  The amount recovered exceeded the US$82,000 meaning that there was no sum left as payable under the reparation order.

[14]     In  any  event  the  parties  are  agreed  that  the  Judge  appears  not  to  have considered whether Ms Taniwha could pay the reparation ordered.  The Judge did not refer to this in his sentencing remarks and there was insufficient information before him to consider this.

[15]     A reparation report was before the Judge.  It advised him that Ms Taniwha claimed to have paid all the money sought as reparation but the report writer had not been able to verify this.  A court is not to order reparation on the mere possibility that the offender may have access to the proceeds of the offending (R v Agnew CA284/89, 19 December 1989 at p 4).  Had the Court obtained details of the civil proceedings it would have become apparent that the funds from the offending had already been recovered.

[16]     The  reparation  report  also  advised  that  Ms  Taniwha  owed  $2578  in outstanding   fines   and   reparation.      It   provided   no   other   information   about Ms Taniwha’s financial position.  No statement of financial position was submitted on her behalf either.  Had the Judge given consideration to Ms Taniwha’s financial position it would have been apparent that any reparation order against Ms Taniwha was unrealistic.  Ms Taniwha had not been in employment since 2006 and had been remanded in custody from November 2008.  She has now been released from prison but has not been in employment because she has health difficulties.  She receives an

invalid’s benefit and some other government allowances.  Her current statement of position discloses significant debts and insufficient income to meet those debts.  An improvement on this position seems unlikely in the foreseeable future.

Result

[17]     I therefore consider that the reparation order must be quashed.  The order was for  a  nil  amount  because  the  civil  recovery  had  already  exceeded  the  amount obtained by deception.  As well, the Judge failed to take into account Ms Taniwha’s financial capacity to pay reparation and had he done so it would have become apparent that she had no capacity to pay reparation.   The application for leave to appeal out of time is granted.

“Mallon J”

Solicitors:

R Simon, Stephen Ross & Associates, Wanganui, email: [email protected]

P Murray, Ben Vanderkolk & Associates, Palmerston North, email: [email protected]