The Queen v Clayton Alistair Harris

IN THE COURT OF APPEAL OF NEW ZEALAND

CA15/00 , CA120/00
CA16/00, CA121/00
CA19/00, CA122/00

THE QUEEN

CLAYTON ALISTAIR HARRIS
ROCHELLE ELLEN HARRIS
CRAIG ALISTAIR HARRIS

Hearing:	17 July 2000
Coram:	Tipping J John Hansen J Baragwanath J
Appearances:	M A Stevens for Appellants J C Pike for Crown
Judgment:	1 August 2000

JUDGMENT OF THE COURT DELIVERED BY BARAGWANATH J

Mr Clayton Harris, his wife Mrs Rochelle Harris and their son Mr Craig Harris appeal against their convictions following jury verdicts and sentences in the District Court at Dunedin on charges of benefit fraud (Mr and Mrs Harris senior), ACC fraud (Mr Harris junior), cannabis cultivation and money laundering. Certain of the conduct was alleged to involve Mr Craig Harris’ wife, Kathryn Harris, who has not appealed her convictions or sentence. Mr Craig Harris’ convictions on charges of ACC fraud, reflected in his sentence, result from trial before a judge alone.
The grounds of appeal may be grouped under the following heads:
(1)Challenges to warrants
(2)Count 1 – Social Welfare conspiracy
(3)Counts 4 and 5 – no evidence submissions in relation to Waiatahuna and Berwick cultivation counts
(4)Count 9 – cannabis conspiracy
(5)Count 13- money laundering
(6)The jury
(7)The summing up
(8)The sentences
Challenges to the warrants

[i] Otago Aero Club:

In 1996 the police began an investigation following information that Mr Clayton Harris and Mrs Rochelle Harris had been making regular cash deposits at the Dunedin branch of the ASB in quantities of $1,000-$2,000 all in folded $20.00 notes much of which had a musty smell. The couple were considered to have acted strangely when making the deposits and Mr Clayton Harris had on occasion disguised his appearance. The police undertook a financial analysis of their affairs.
On 21 July 1998 Constable van Turnhout of the Dunedin Police prepared a composite application and affidavit in support seeking the issue of a search warrant. The document was intituled
“IN THE MATTER of an application for a search warrant in respect of building, box, vehicle, receptacle, premises or place pertaining to Otago Aero Club, Stedman Road, Taieri Airport.” (Emphasis added)
The affidavit portion gave an account of the execution of search warrants at the homes of Mr Craig and Mrs Kathryn Harris in Ashmore Street, Dunedin, where 20 pounds of high-grade cannabis had been located and at the home of Mr Clayton and Mrs Rochelle Harris in Scroggs Hill Road, Dunedin, where further evidence of the cultivation of cannabis had been found. All four members of the family had been arrested and charged with offences relating to the sale of cannabis and money laundering and Mr Clayton and Mrs Rochelle Harris had been charged with fraud. The Constable deposed that all four accused had been spending large sums of money on the purchase of motor vehicles despite the fact that Mr and Mrs Harris senior had been receiving Social Welfare benefits for the previous 10 years and Mr Craig Harris was also a beneficiary. Documents had been located indicating that Mr Clayton Harris is a holder of a private pilot’s licence believed to have been obtained through the Otago Aero Club at a cost of between $5,000 and $8,000. The police sought from the Aero Club all financial records held by it relating to Mr Clayton Harris for the purposes of carrying out a full financial analysis on him and his wife. The belief was expressed that substantial funds being the proceeds of the cultivation of cannabis and sale of cannabis had been the means for him to obtain his licence.
Immediately following the affidavit portion there followed the application
“I therefore apply for a search warrant to be issued in respect of the said building, vehicle, box, receptacle, premises or place pertaining to ANZ Terrace Branch, Wellington, the account of UDC Finance Ltd.” (italics added)
The same day a Deputy Registrar issued a warrant expressing satisfaction that there was reasonable ground for believing there to be “situated at Otago Aero Club, Stedman Road, Taieri Airport” inter alia all financial records relating to Clayton Harris. The warrant authorised the search of the Otago Aero Club premises.
The trial Judge rejected a defence submission that the warrant was invalid, so that material received in consequence of its execution was inadmissible.
Repeating that argument before us, Mrs Stevens for the appellants submitted that the discrepancy between the affidavit and the application could only mean that the Deputy Registrar had rubber stamped the application, rather than exercising the judicial function required by s 198 of the Summary Proceedings Act 1957.
Mr Pike for the Crown supported the trial Judge’s rejection of the point by reference to s 204 of the Summary Proceedings Act 1957, which provides:
204 Proceedings not to be questioned for want of form -
No information, complaint, summons, conviction, sentence, order, bond, warrant, or other document, and no process or proceeding shall be quashed, set aside, or held invalid by any District Court or by any other Court by reason only of any defect, irregularity, omission, or want of form unless the Court is satisfied that there has been a miscarriage of justice.
The Judge made no finding on what had occurred before the Deputy Registrar. Neither the Constable nor the Deputy Registrar appears to have noticed the erroneous reference in the three line application at the end to a separate institution. On the face of the document it would have been open to the Judge to have concluded that read as a whole, starting with its intituling continuing through the affidavit portion, it was plainly directed at procuring information from the Otago Aero club. But in any event Mrs Stevens acknowledged that had the point been raised by either of them there would inevitably have been an amendment to bring the formal application into line with the affidavit. She was unable to suggest any basis for a conclusion that the deficiency in procedure constituted or contributed to a miscarriage of justice in terms of s 204 (or of s 385(1)(c) of the Crimes Act 1961).

[ii] Bank of New Zealand

Documents later given in evidence had been supplied by the Bank of New Zealand to the police in respect of Craig Harris, apparently under an erroneous but honest belief that they were embraced by search warrants relating to other property. The defence objected on a pre-trial application under s 344A to the admissibility of the evidence. A District Court ruling admitting the evidence was upheld by this Court in a judgment delivered on 6 October 1999. The police took the cautious step of returning the evidence and then re-taking it under a fresh warrant, plainly with a view to legitimating any defect in their possession of the information. On a subsequent ruling following arraignment the Judge held that the Crown should not be denied the opportunity to produce before the jury the evidence which had been sought in good faith by the police and made available in good faith by the bank, prior to the issue of the fresh warrant. The Judge referred to a “residual discretion in the Court in any case where illegally obtained evidence is obtained to permit the production of that evidence.”
In the course of the trial the defence further challenged the bank’s providing to the police prior to the issue of a search warrant information assisting them to formulate its terms. That challenge also failed.
Mrs Stevens repeats the submission that the BNZ material should have been excluded. She argues
[i]that it was illegally obtained;
[ii]that a subsequent warrant could not retrospectively cure the unlawful obtaining of items previously obtained; and
[iii]that the return of the documents made no difference.
In its judgment of 6 October 1999 rejecting the arguments then advanced by Mrs Stevens this Court described them as completely misconceived. We make a similar response to the present submission. As observed in the earlier judgment, while
“…there is no dispute that banks owe a general obligation of confidentiality to their customers. There is also no dispute that that obligation is subject to limits …(b) where there is a duty to the public to disclose, (c) where the interests of the bank require disclosure…There is also the principle…that there is no confidence preventing the disclosure of iniquity…It is significant that in the present case the bank accounts were themselves the vehicles for the offending – namely money laundering. Even in the absence of legislation [an allusion to the Financial Transactions Reporting Act 1996] there would be a power and perhaps even a duty to consider and respond to police questions about that… A further relevant point is that any obligation of confidence owed by the institution to its customers is not in general owed to third parties. The police, for instance, remain free to seek relevant information from banks at least in the absence of reason to believe that the disclosure would be unlawful. Indeed, as the facts of this case … show, in the absence of such enquiries and of informative responses to them, they may be prevented from establishing a sufficient basis to obtain a search warrant.”
Those remarks, to which Mrs Stevens did not refer us, provide a direct answer to the present ground. There was no illegality. We see no arguable basis for the bank to have been required to resist the production of the records sought by the police in the course of their enquiry. It was its right, its moral duty and perhaps its legal duty to assist the investigation.

[iii] The presence of an ACC officer during the execution of the search warrant at Mr Craig Harris’ home.

The charges on which Mr Craig Harris was convicted after trial before a judge sitting alone involved ACC fraud. Mrs Stevens referred to s 198(3) of the Summary Proceedings Act in support of her submission that the presence of an ACC officer during the execution of the search warrant at Mr Craig Harris’ home entailed illegality. She cited no other authority in support.
Section 198(3) is an empowering measure providing
(3)Every search warrant to search any … premises … shall authorise any constable … to enter and search the … premises … with such assistance as may be necessary… (italics added)
It was submitted that the ACC officer’s presence effectively permitted another agency to use the warrant obtained by the police without requiring that agency to perform its own investigation.
In so far as the submission is one of improper purpose it lacks any evidentiary basis. The police were seeking information in the course of a bona fide enquiry which led to the charges on which the appellants were later convicted.
And in so far as the search related to documents bearing upon that enquiry there can be no possible ground for criticising the police for securing the presence of an ACC officer who could assist them in performing their task.
Each of the warrant grounds fails.
Social Welfare conspiracy
The first count in the indictment was in the following terms:
“The Crown Solicitor at Dunedin charges that Clayton Alastair Harris and Rochelle Ellen Harris between 28^th day of May 1986 and the 10^th day of May 1998 at Dunedin and in other places in the province of Otago, did conspire together by deceit to defraud the Department of Social Welfare of monies in the form of unemployment and sickness benefits."
It was first submitted that the conspiracy count for the 12-year period was oppressive and inherently prejudicial.
As a submission relating to the length of the period embraced by the count we do not accept it. There is no reason in law why it should not be alleged in such manner. Any difficulty could have been resolved by an application for further particulars as contemplated by the proviso to s 331: see R v Arnold (No. 1) [1977] 1 NZLR 718.
It was then submitted that the count was unjustified, at least as to part, by reason of absence of evidence that Mr Clayton and Mrs Rochelle Harris were not entitled to receive the benefit during the period 1986 to 1993, although it was conceded that there was evidence of income earned by them for the period from 1993 until 1998. It was further submitted that Mr and Mrs Harris senior were prejudiced by the jury’s lacking the opportunity to distinguish between these respective periods and that the sentencing Judge was obliged to sentence them for committing a fraud over a period of 12 years.
The evidence as to undisclosed income derived from expenditure patterns which included the making of a deposit of some $5,999 on a Honda Accord motor car as early as March 1986 and improvements of the order of $38,000 of a property at Waiatahuna during the period from August 1987 until its sale in April 1993. There is no evidence as to when those improvements were effected. A source and disposition analysis by Detective Ferguson covers the period from 1 January 1992 until 6 May 1998 although referring to cash dealings of various kinds from 8 September 1986.
The matter was put by the Judge in summing up (page 9) as follows:
“Reference was made to the wide period for this charge. However, the Crown are entitled to frame the charge in this fashion. To find the accused guilty you need to be satisfied that at some time over the period alleged there was an agreement by both to receive benefits which they knew they would not qualify for through income received through other sources and it need not necessarily therefore be drug money…”
The case being put on that basis, the jury was not exposed to the problems for which counsel contends even if the period alleged was expressed more widely than the evidence established. It was not suggested that the jury had been led astray in any other fashion. The essential question is whether the sentence imposed in relation to this count, and overall, exceeded what was justified. We return to that topic. The present ground fails.
The no evidence submission in relation to Counts 4 and 5
The Judge rejected no case submissions in respect of 4 and 5, which were renewed before us. In relation to Mr and Mrs Harris senior we agree with the Judge’s conclusions. We are of a different opinion as regards their son.

Count 4 Waiatahuna

The count alleged that Mr Clayton Harris and Mrs Rochelle Harris senior and Mr Harris junior, between 1 August 1987 and 30 April 1993, cultivated cannabis at a Waiatahuna property. It was not an economic farm unit. Mr and Mrs Harris senior had bought it in August 1987 for $13,896, subject to a loan of $8,000. Having made improvements of some $38,000 they sold it in April 1993, each of them having been in receipt of unemployment benefit throughout.
Across a lawn from the farmhouse was a large corrugated iron implement shed, which had belonged to the neighbouring property. The process of improvement closed in what had been an open building; a substantial part of the roofing iron was replaced by Clearlight; the interior was lined with silver insulating paper; water and electricity were connected. These are all of utility for successful hydroponic cannabis production. The property was surrounded by a six foot high fence. Two cannabis husks were found on the floor of the shed.
By the time of the 1993 sale the lining paper had been removed to reveal the corrugated iron of the walls. There were left hanging strings and ties which the Crown submitted were appropriate for the suspension of plants. They were taken by a police officer and submitted for scientific examination. His account was that the string was orange, blue or green and black.
A scientist of the Institute of Geological and Nuclear Sciences described receiving string and ties. Both were found to contain cannabis spores and pollen. While the scientist’s finding of 2% cannabis appearing on the ties did not exclude the possibility that it had derived from random dispersal from an external source, he reported that the finding of 6% on the strings strongly supported the contention that they had been in close proximity to growing cannabis.
Both at trial and before this Court the defence challenged the link between the string described by the police officer and that which the scientist analysed. He described the colour of the string as red, blue, green and black and white, but predominantly white. He said that the black and white string appeared to be a black string that had faded or a white string that was very dirty. The white being on the outside tended to be more dominant than the dark colour that was in the grooves.
The challenge was rejected by the jury. That conclusion was obviously open to them on a literal comparison of the two accounts.
Mrs Stevens advanced a number of negative factors as tending to refute guilt. They included the evidence that there was innocent reason for Mr Harris to want a change of life style; there had been visitors to the property, which also was clearly visible from the road, but there was no evidence that suspicious activity had been observed; the improvements were consistent with being those needed to convert an implement shed into a work shed. The evidence as to the value of the improvements was challenged. There could have been access by others via an unlocked gate, given that the present owner lived and worked in Dunedin two nights a week. The shed did not appear to have been cleaned out; it was submitted that one would expect there to have been more than two cannabis husks in evidence had there been a large scale operation of the kind alleged by the Crown. There had been no attempt at concealment of the strings and ties, which could have been used for other purposes, or to remove the water and electricity connections. There was no evidence to establish undue use of electricity.
All these were parts of the evidence considered by the jury. The jury had also before them the parts relied on by the Crown as tending to point to guilt. We are satisfied that when there are added to the specific cannabis evidence the unexplained income and the nature of the improvements there was ample evidence to justify their verdict on Count 4 in relation to Mr and Mrs Harris senior.
During the Waiatahuna period Mr Harris junior had lived with his parents from time to time. He lived and worked elsewhere for the balance of the period.
While the Crown, on the basis of the large quantity of cannabis found in his possession in Dunedin on 6 May 1998, had reason to be suspicious as to his implication in the Waiatahuna offending a decade or so before, it had no contemporary evidence save the family relationship and his sometime presence to link him with the offending of his parents. Unlike them he was not an owner of the property. There is force in Mrs Stevens’ submission that without further evidence of his own involvement in the operation his mere presence at times on his parents’ property was not enough to take suspicion to proof. He was not charged with his parents’ subsequent Berwick offending which occurred between April 1993 and April 1996 and there is in our view no sufficient nexus with his Dunedin offending, alleged to occur during a period beginning in 1993, to inject the missing element. We therefore allow his appeal against conviction on Count 4.

Berwick: Count 5

The count alleged that Mr and Mrs Harris senior, between 5 April 1993 and 3 April 1996, cultivated cannabis at a Berwick property. They had bought it in May 1993 and sold it in April 1996 having made improvements of some $98,000, each of them having again been in receipt of unemployment benefit throughout.
The Berwick property contained a farm shed. Its improvements included the addition of a mezzanine floor and the supply of electricity and water. Two small pieces of tin foil under a staple permitted the Crown to submit that, like the Waiatahuna shed, it had had been insulated, and that the insulation had later been removed with almost scrupulous care. Debris from the mezzanine floor contained trace elements of cannabis pollen. Plastic sheeting from the same floor contained 1% or less of cannabis grains. Three cannabis seeds found on a bedroom floor had been left there prior to the occupation by the purchasers from Mr and Mrs Harris. There were two clearings on a hillside of a kind used by those who grow cannabis; as well, of course, as by any others who might wish for some reason to grow plants in such a location.

Mrs Stevens renewed before us an attempt made before the jury to discredit the plain evidence as to the identification of the cannabis seeds, given by the purchaser of the Berwick property. He had been a general service instructor in the Air Force, who had been taught by military police to identify such seeds and the paraphernalia of drug use. While he disclaimed being an expert in the identification of cannabis, with his experience it was well open to the jury to regard him as reliable.
Mrs Stevens submitted that the evidence relied on by the Court was insufficient to justify leaving Count 5 to the jury, especially when taken with the negative evidence. That included the absence of evidence of cannabis plant, seed or husk or soil debris; there being no water to the mezzanine floor; there having been visitors to the property who saw nothing abnormal; and the fact for half the time that Mr and Mrs Harris senior owned the property they had permitted unrestricted viewing to potential purchasers. Again there had been no evidence of excessive use of electricity.
We disagree. We repeat that it is necessary to take the pieces of evidence as a whole, not in isolation from each other. While the cannabis pollen and grains might, without more, be explained as possibly wind blown, that evidence was accompanied by the physical changes to the shed and the unexplained access to the large sums of money required to make them. The modus operandi, including the careful removal of the insulation at some time prior to sale, is that previously employed by Mr and Mrs Harris senior at Waiatahuna.
We are satisfied that there was sufficient evidence to justify the convictions on Count 5.
Count 9 – cannabis conspiracy
The count was expressed in the following terms:
“The Crown Solicitor at Dunedin further charges that the said Clayton Alastair Harris, Rochelle Ellen Harris, Craig Alistair Harris and Kathryn Ann Harris between the 1^st day of January 1986 and the 10^th day of May 1998 at Dunedin and at other places in the province of Otago did conspire with each other to commit an offence under s 6(1)(e) of the Misuse of Drugs Act 1975, namely the sale of cannabis to a person or persons unknown.”

Mrs Stevens submitted that the trial Judge had erred in allowing Count 9 to go to the jury in relation to the period prior to 1993. She conceded that there was evidence on which it was open to the jury to find conspiracy from the beginning of 1993. The concession followed the absence of challenge to the convictions of all three appellants in relation to Count 6, which alleged cultivation of cannabis at Ashmore Street, Dunedin, which Mr Harris junior and his wife bought in October 1993 and retained until the discovery there of the 20 pounds of cannabis in May 1998.
In opening the Crown case the Crown Solicitor described the count as alleging
“… a conspiracy between the four accused between August 1987, which is when the first property Waiatahuna was purchased, through to May 1998 when the search is completed…”

The Crown conceded that it was not until 1993 that Mr Craig Harris met and married his wife Kathryn.

Mr Pike acknowledged that the count as drafted alleged a four-party conspiracy. Since that could not have commenced prior to 1993 we accept Mrs Stevens’ submission that the antecedent period was wrongly included in the count. We are satisfied that the interests of justice require that the count be amended to describe the period as “between the first day of January 1996 and the 10^th day of May 1998…” We later consider the effect on sentence of this amendment.
Money laundering
Count 13 alleged
“…the said ROCHELLE ELLEN HARRIS between the 8^th day of September 1995 and the 12^th day of March 1998, at Dunedin, in respect of money that was the proceeds of a serious offence engaged in a money laundering transaction, namely the depositing of monies in a Trustbank/WestpacTrust Account number 4773 69446 in the name of C A and R E Harris, knowing or believing that all or part of the money was the proceeds of a serious offence.”

It related to the deposit of benefit moneys paid by Income Support.

The relevant part of the statutory money laundering provision (s 257A) is reproduced:
(2)… every one is liable to imprisonment for a term not exceeding 7 years who, in respect of any property that is the proceeds of a serious offence, engages in a money laundering transaction, knowing or believing that all or part of the property is the proceeds of any serious offence.

(emphasis added)

Mrs Stevens submitted that the form of the indictment was defective in treating the receipt of the credit into Mrs Harris senior’s account as a concurrent act of money laundering. It is unnecessary for us to analyse s 257A in detail; we accept the simple argument that the conduct here alleged as laundering is the very conduct constituting the “serious offence” and relied on as “the proceeds of [a] serious offence”. For s 257A to be infringed the laundering must follow a discrete antecedent “serious offence”. Since that did not occur the conviction of Mrs Rochelle Harris on Count 13 is set aside.
The jury
The Judge declined on two grounds a defence submission that the jury should be discharged and a mistrial directed. Both grounds were renewed before us.
The first ground was that during the trial several members of the jury complained to the police that they felt intimidated by the conduct of the female partner of another son of Mr and Mrs Harris senior. She was said to have taken photographs of jurors outside the Courtroom. The Judge on 10 November 1999 made enquiry of the jurors whether any had particular concern about continuing to perform their functions, and invited them in that event to raise the matter with him. Following the enquiry by one juror he advised that the film had been developed and in fact contained no photograph of any juror. He advised them that for the future arrangements would be made for them to be escorted from the Court premises.
It was submitted that the jurors would, or might, feel intimidated by the appellants and there was risk that they would not have brought an impartial mind to bear in exercising their function.
The Judge was right not to discharge the jury. His immediate direction dealt effectively with what had happened. In summing up on 19 November 1999 he gave as appropriate general direction about excluding sympathy and prejudice. He wisely made no more of the photography point, which had been shown to have no substance.
An allegation that the jury may have been distracted from their task must be considered with care. But whether or not any of the appellants were implicated in the episode, of which there is no evidence, it would be a thoroughly undesirable development for an accused to be able to abort a trial by inducing such conduct. The criminal process requires a more robust approach.
The second ground was that after the jury, already reduced to 11, had been empanelled one juror indicated that she was related to the accused. She turned out to be a sister of the in laws of the niece of Mr and Mrs Clayton senior; the appellants had not been aware of the relationship.
In May 2000 affidavits were sworn on behalf of the appellants, raising various issues that were referred to independent counsel for report. In the event the only material requiring consideration is that as to the relationship between the juror and the appellants.
Following jury selection on 26 October 1999 the trial ran for 3 weeks, the jury retiring and later returning its verdicts on 16 November 1999.
Mrs Harris senior deposed that after selection of the jury she became concerned that a particular member was a relation, although she could not actually place her. She said that the point was raised with the Judge and gave hearsay evidence that he had expressed reluctance to enquire further into it because the jury had already been reduced to 11. She said that her counsel Mrs Stevens told her she had not raised the point because the Registrar had previously done so; the juror had told a Court attendant that she thought there to be a distant relationship. Mrs Harris said she “didn’t have any further knowledge about [the juror] until after the trial but…felt quite uncomfortable about her sitting there on the jury.” Mrs Stevens advised us, by contrast, that the point was disclosed to her only on the second last day of the trial. At the conclusion of the trial defence counsel unsuccessfully advanced the topic as a ground for ordering a mistrial.
On 4 May 2000 an affidavit was sworn by the niece of Mrs Harris senior. She said that in October 1999 she and her husband had been invited to the home of his parents for a meal. Her husband’s sister, the juror, was present. The deponent said “There are other ways people make money…” The juror replied “Drug dealing is like a pyramid, silly buggers on the bottom and the ones higher up making the money”.
Mrs Stevens applied for leave to adduce the affidavit evidence and submitted, on that evidence which we read de bene esse, that the niece’s in laws are people who were not sympathetic to the appellants.
There are several reasons why the present ground must fail. First, on the basis of the affidavit evidence, the point of relationship was one that could have been pursued at the outset of the trial. With reasonable diligence the appellants could have made the enquiries that resulted in the 4 May affidavit and pursued the present argument. No explanation was made for leaving the point until the conclusion of the trial. For the reasons given in Auckland Casino Ltd v Casino Control Authority [1995] 1 NZLR 142 the law does not encourage litigants to defer a bias challenge until they have seen the result on the merits. For the reasons next given it is unnecessary for us to consider the matter on the alternative basis that counsel was notified only on the penultimate day of trial. That would raise the question of why there had been such delay.
Secondly, there is nothing in the very distant relationship itself that would warrant an inference that personal factors could entail significant risk of bias. Nor could a statement in such general terms be assumed, without more, to be related to the particular case. It might or might not be.
Even if it were, it is a far cry from a general statement at an early stage of the trial, in terms that some would regard as a truism, to an inference that the juror has been false to her oath. The juror did not infringe the direction commonly given to the jury at an early stage, that they must not discuss the case with others. There is no suggestion, for example, that she had received information to the discredit of the appellants. Her statement was at most an allusion to her attitude to drug dealing, expressing a sentiment with which many New Zealanders would agree. The holding of such an opinion is no disqualification to jury service; jurors are not required to bring to their task a mind that is empty of moral sentiment. On the contrary the purpose of the jury process is to bring to bear the combined life experience of members of the public. They are taken by summons and ballot from their normal life, which they must accommodate to their public service as best they can.
The episode shows the desirability of jurors’ taking particular care to avoid any remark that might be taken to relate to their jury service. But the evidence provides no basis for apprehension that the juror’s mind had been deflected from the proper discharge of her functions.
The valuable research of Professor Warren Young and his colleagues as to the operation of the jury system (see NZLC PP37 Juries in Criminal Trials (1999)) demonstrates the care and sense of responsibility with which jurors customarily discharge their function. There is no reason to doubt that such approach was adopted by the jurors in this case.
The summing up
The Judge in summing up outlined the Crown and defence cases in relation to each count. Complaint was made that the summing up did not give an overview or general summary of the defence case. Each of us has read the summing up and is satisfied that it was fair and balanced, leaving the jury in no doubt as to the essence of each party’s case. This ground fails.
The sentences
Mr and Mrs Clayton senior each received a sentence totalling 6½ years for three distinct classes of offending: cannabis offending; fraud; and money laundering. Mr Craig Harris received 5 years.
The sentencing Judge, who had not presided at the trial, imposed a sentence of 5½ years on Mr and Mrs Harris senior in respect of cannabis cultivation over a period from between 1987-1993 until 1998; 18 months cumulative reduced to 12 months in terms of the totality principle for fraud over a period of 12 years and 2½ years concurrent with the cannabis term in respect of counts of money laundering from November 1995 until 1 May 1998. All except one of the laundering charges related to money obtained by drug offences; we have acquitted Mrs Harris senior on the other. For the cannabis conspiracy a concurrent 3 years was imposed. Concurrent sentences of 3 months were imposed for using documents for obtaining pecuniary advantage – substantive charges effectively embraced within the fraud convictions – and also for permitting premises to be used for the purpose of the commission of a drugs offence. Mr Harris junior was sentenced to four years on the counts of cannabis cultivation; to 2½ years concurrent on the drug conspiracy; to 12 months cumulative but concurrent with each other on four charges of ACC fraud; 6 months for money laundering concurrent with the cannabis sentence; and three months concurrent for making a false declaration. Mrs Harris junior was sentenced to 2½ years for the cannabis offending and 18 months concurrent for the money laundering. A forfeiture order stripped the appellants of their property, including the home at Scroggs Hill Rd, Dunedin, which the sentencing Judge held had derived in significant part from legitimate sources.
The effect of our judgment on the conviction appeals is that Mr and Mrs Harris senior remain convicted of the cannabis cultivation and of the drug conspiracy (from 1993); of the conspiracy to defraud the Department of Social Welfare; and of money laundering save in respect of the Social Welfare funds (Count 13). Mrs Harris was acquitted of that last. Mr Harris junior has been acquitted in respect of cannabis offending before 1993, in respect both of Count 4 (Waiatahuna) and of the four party cannabis conspiracy which, as alleged, began not in 1986 but in 1993.
Mrs Stevens submits that the sentences were excessive in terms of the jury verdicts and the more so in the light of the success of certain of her challenges to those verdicts.
To appraise that submission it is necessary to consider the overall substance of the offending.
We summarise the remarks of the sentencing Judge which were not challenged.
The police investigation into the financial affairs of the appellants and Mrs Kathryn Harris took over two years. It revealed that they operated among them 46 bank accounts at four different banks in a variety of names.
The source and disposition analysis in respect of Mr and Mrs Harris senior established their receipt between January 1992 and May 1998 of more than $331,000 from undisclosed sources. On the improbable scenario that cash withdrawn from bank accounts may have been rebanked, the sum still exceeded $196,000.
Large cash transactions occurred earlier than 1992. These included the use of cash for the purchase in 1986 of a boat motor for $1,250 and in 1989 for completing a property transaction for $14,000.
The source and disposition statement relating to the affairs of Mr and Mrs Harris junior began in his case in January 1992 and in hers during 1993. Cash from unknown sources exceeded $200,000; on the rebanking scenario there was a sum in excess of $64,000.
The evidence of transactions involving property and motor vehicles showed the appellants and Mrs Kathryn Harris living well beyond their means. From August 1987 Mr and Mrs Harris senior expended some $140,000 on improvements to various properties which they bought and sold. From March 1986 they bought 23 motor cars or utilities, motor cycles or boats at a total cost in excess of $176,000. From January 1991 Mr and Mrs Harris junior bought 5 motor vehicles at a total cost of $106,000.
In the light of the jury’s verdicts the large expenditure by the three appellant beneficiaries and by Mrs Kathryn Harris, a bank teller, can only have been funded by the proceeds of drug dealing.
The cannabis found at the home of Mr and Mrs Harris junior on 6 May 1998 was of high quality with a street value of between $$70,000-$100,000. It represented one season’s crop. The windows of the building were masked by tape, batteries of fluorescent lights were erected, equipment for the cultivation of cannabis was in evidence, fertiliser, humidifier, fan, peat pots with the walls studded with the walls studded with staples and cords. The building had been used not just to dry cannabis but also to cultivate it.
Searches of the home of Mr and Mrs Harris senior the same day and a fortnight later revealed traces of cannabis plant, material scattered about the property. $13,000 in cash was buried in the garden and at the time the search warrant was executed Mr Harris senior accused the police of stealing another $15,000 in cash – an accusation that was later retracted.

We have already described the Waiatahuna and Berwick offending.

The sentencing Judge observed that

If offending of the kind discovered in May 1998 was representative of what had occurred during the previous decade the revenue would equate to some $700,000-$1M.
If one halved those amounts the conspiracy and commercial cultivation would fall within the third category of offending identified by the Court of Appeal in R v Terewi [1993] 3 NZLR 62.
In relation to the Social Welfare fraud Mr and Mrs Harris senior were at all material times in receipt of sickness and unemployment benefits. While they were involved in business in a limited way in a variety of small operations they withheld from Social Welfare their very substantial income from illegal cannabis dealing and so continued to receive benefits at a rate and of a total amount to which neither was entitled. Two of the counts on which Mr Harris senior was convicted involved false assertions in claims for sickness benefit.
During the four years 1995 to 1998 Mr Harris junior received Accident Compensation as a result of supposed inability to work because of back injuries. He made repeated false statements in medical certificates about his fitness to work. In fact he was active throughout the period in physically demanding sports, including shark fishing, deer stalking and soccer.
The result of the frauds realised Mr Harris senior almost $72,000, Mrs Harris senior more than $63,000 and Mr Harris junior more than $43,000.

We agree with the Judge that the case against Mr and Mrs Clayton senior is one of large scale commercial dealing, falling squarely within the third category of R v Terewi in terms of its nature, scale and duration. The head sentence of 5½ years for cultivation was appropriate. The cannabis conspiracy conviction, which we have modified, was rightly treated by the Judge as ancillary to that sentence.
Mr Craig Clayton’s acquittal in relation to Waiatahuna, and the limiting of the conspiracy to the period from 1993, requires review of his 4 year head sentence. To recognise the partial success of his appeal and to maintain proportion with his parents’ sentence we reduce his 4 year cultivation sentence (Count 6) to 3½ years.
We further agree that the fraud offending by each appellant warrants the addition of a cumulative 12 months. We have noted that while the major source and disposition evidence did not go back before 1 January 1992, the first evidence of the Social Welfare fraud by Mr and Mrs Harris senior was as early as 1986. Their motor vehicle dealing began in 1986 and continued in 1988 (one transaction), 1990 (one transaction), 1992 (two transactions), 1993 (three transactions), 1994 (one transaction), 1995 (one transaction), 1996 (three transactions) and 1997 (two transactions). Mr Craig Harris’ ACC offending occurred throughout the four year period from 1995 to 1998. But for the totality principle a longer sentence for fraud would have been warranted in each case. We agree with the Judge’s approach to totality and make no reduction in respect of Mrs Clayton senior’s acquittal on Count 13 (laundering Social Welfare receipts) which had not attracted a cumulative sentence.

To summarise, we allow in part the appeal against conviction of all appellants on Count 9 (the cannabis conspiracy count) by amending it to commence on 1 January 1993; we allow Mrs Rochelle Clayton’s appeal against conviction on Count 13 (laundering Social Welfare receipts) and allow Mr Craig Harris’s appeal against conviction on Count 4 (Waiatahuna). We also allow in part Mr Craig Harris’s appeal against sentence by reducing to 3½ years his cultivation sentence (Count 6). Otherwise all sentences will stand, so that the total sentence of Mr and Mrs Harris senior is 6½ years and that of Mr Craig Harris 4½ years.

Solicitors

Crown Law Office, Wellington

[2000] NZCA 149

1 August 2000