The Queen v Stuart Carlyle Kennedy

IN THE COURT OF APPEAL OF NEW ZEALAND

CA282/00

THE QUEEN

STUART CARLYLE KENNEDY

Hearing:	2 November 2000
Coram:	Gault J Keith J Anderson J
Appearances:	T Fournier for the Appellant N M Crutchley for the Crown
Judgment:	15 November 2000

JUDGMENT OF THE COURT DELIVERED BY KEITH J

Mr Kennedy was convicted on two charges of receiving stolen goods (electronic goods and ski suits) following a summary hearing in the District Court in Christchurch. His appeal to the High Court was dismissed and he was granted leave to appeal to this Court under s144 of the Summary Proceedings Act 1957.
The question of law as stated relates to the word “possession” as used in s260 of the Crimes Act 1961. That provision is to be read with s258(1) which defines the offence of receiving :
258. Receiving Property Dishonestly Obtained—
(1) Every one who receives anything stolen, or obtained by any other crime, or by any act wherever committed which, if committed in New Zealand, would constitute a crime, knowing that thing to have been stolen or dishonestly obtained, is liable—
(a) To imprisonment for …
…
260.When receiving is complete —
The act of receiving anything unlawfully obtained is complete as soon as the offender has, either exclusively or jointly with the thief or any other person, possession of or control over the thing, or aids in concealing or disposing of it.
The question of law stated by the High Court is in these terms:
Does the test for possession of drugs also apply to s260 of the Crimes Act 1961? If not, what is the test for possession or control under that Act?
As will appear, the issues are more appropriately addressed in terms of the legislative provisions themselves, rather than in terms of a comparison with the drugs context. The relevant facts as found by the District Court Judge can be stated briefly. A Mr Biggs gave evidence that in agreement with Mr Kennedy he took stolen goods to the latter’s house and left them in the garage in polythene bags. About a month later the police executed a search warrant at Mr Kennedy’s house and found the electronic equipment on a bedroom floor in carry bags with the name of the owner, a video parlour, on the outside. Ski suits and a jacket, all with price tags attached, were found in a wardrobe in the house.
The prosecution did not establish that the appellant knew that the goods were stolen when Mr Biggs placed them in the garage. Rather the prosecution argument as stated and accepted in the High Court was that the appellant
did not have possession or control in terms of s260 until he became aware of the essential nature of the goods and that this occurred when the appellant moved the goods into the house. In other words, the receiving was not complete until that time. I am also satisfied that it was open to the Judge to conclude that the appellant knew at that time that the goods had been stolen or dishonestly obtained. On the evidence there was clearly at least a prima facie case in relation to both the electronic equipment and clothing and the Judge was entitled to take into account the failure of the appellant to provide an explanation. On my reading of the judgment the Judge has applied the requisite subjective test as to the appellant’s knowledge.
The conclusion about possession and control was reached in the High Court, at least in part, by reference to cases decided under the Misuse of Drugs Act 1975; that connection also appears from the question put to this Court.
We return to the words of ss258 and 260 of the Crimes Act. Under the first the prosecution must establish three matters : (a) receiving, (b) anything stolen, (c) knowing that thing to have been stolen. That knowledge must exist at the time of the receiving. Later knowledge does not satisfy the plain words. Mr Kennedy did not have that knowledge when the goods were put in his garage. Does it not follow that he should be acquitted?
The answer so far given to that question on the facts of the present case turns on s260; it is that Mr Kennedy did not have possession of or control over the goods (and thus did not receive them) until he knew the essential nature of the goods.
That reading, in our view, cannot be reconciled with the plain words of the statute. Policy considerations also weigh against it. And it is not supported by the drugs cases.
First, the words. While s260 undoubtedly includes a mental element, because possession or control cannot, in the normal case at least, exist without the possessor or controller knowing of and intending to exercise possession or control, it is s258 which sets out the guilty mental element of receiving. That mens rea element is the knowledge at the time of receipt that the goods were stolen. It is inconsistent with the wording and structure of the provision to introduce that element into s260 as well. Cases in other jurisdictions on the same, or similar, legislative provisions place the same emphasis on the temporal element : eg R v Grainge [1974] 1 All ER 928 (CA) (where orthodox receiving was charged, knowledge at the moment of receipt, and not at any later time during the handling of the goods, was required) and de Bono v Neilsen (1996) 88 ACrimR 46 (SC Vic) (the statute was similarly interpreted, receiving being a single finite act and knowledge being assessed at the moment of receipt).
Section 258 requires the relevant guilty knowledge to exist when the goods are received. The very idea of receipt is that it occurs at a particular moment. It is at that moment that the knowledge that the goods have been stolen or dishonestly obtained must exist. That precise temporal emphasis appears, as well, from the wording of s260 that the “act of receiving … is complete as soon as” certain things happen. While it is true that at least two of those things – possession and control – ordinarily last over a period, s260 is concerned only with the very beginning of those things. It is not concerned with their ongoing character.
There are also strong policy reasons for rejecting the reading of s260 given in the District Court and High Court. What is the justification for holding criminally liable persons who for some time have innocent possession or control over a thing, completely ignorant of its being stolen, from the moment that they discover that it has been stolen? What effect would such a ruling have on their willingness to return such property to its owner or hand it in to the police? The matter would be otherwise, of course, were the person in possession or with control, and now with knowledge of the dishonesty, to make use of the property. Such action might very well amount to theft by fraudulent conversion to the possessor’s use in breach of s220 of the Crimes Act. In other jurisdictions, which have reformed their theft and receiving law, such actions may also be crimes of dishonest handling of stolen goods (knowing the goods to be stolen) eg Theft Act (UK) s22 (discussed in R v Grainge) and the Crimes Act 1958 (Vic) s88 (modelled on the UK Act and discussed in de Bono v Neilsen).
The various decisions on the Misuse of Drugs Act 1975, which concern the criminal liability of the person in possession of controlled drugs, are of little relevance in the present context. Three features of that legislation distinguish it from the present situation. First, by contrast with the crime of receiving, the crime of possession of a controlled drug does not contain any express guilty mental element : see Misuse of Drugs Act, s7; see also s29. Instead, the guilty mental element of knowledge that the item possessed is a controlled drug has been read as implied in the legislation, consistently with its purpose; R v Metuariki [1986] 1 NZLR 488. Second, possession in the drugs context is plainly concerned with a continuing state of affairs : the person in possession commits an offence during the (knowing) period of possession. Third, to reinforce the point made in para [12] about the innocent “receiver”, it is a defence to the crime of possession of a controlled drug if the person charged can prove that their possession was for the purpose of preventing another from committing an offence or for returning the drug to someone lawfully entitled to have possession of it : Misuse of Drugs Act, s7(3). Thus, the policy factors which tell against the reading given to s260 of the Crimes Act in the lower courts do not apply in the drugs context.
To return to the question stated by the High Court, we accordingly conclude that the tests for the possession of drugs do not apply to s260 of the Crimes Act. Rather the provisions of s260 are to be applied in their own terms : the act of receiving is complete as soon as the alleged offender (among other things) has possession or control over the thing. That test requires both factual and mental elements, with the latter being limited however to the knowledge that the person possesses or controls the thing and the intention to exercise possession or control, and not that the person knows that it has been stolen or dishonestly obtained. The question should be answered in those terms.
The District Court Judge did not find that Mr Kennedy had the requisite knowledge at the point that he had obtained control (at least) over the goods (when they were put in his garage). The consequence must be that the appeal is allowed and the convictions quashed. There will not be a further trial.

Solicitors
T Fournier, Christchurch for the Appellant
Crown Law Office for the Crown

[2000] NZCA 328

15 November 2000