ZHANG v R [2004] NZCA 141 (13 July 2004)

Court of Appeal of New Zealand

[Index] [Search] [Download] [Help]

---

ZHANG v R [2004] NZCA 141 (13 July 2004)

Last Updated: 26 July 2004

IN THE COURT OF APPEAL OF NEW ZEALAND

CA153/04

THE QUEEN



v



YUAN YING ZHANG

Hearing: 6 July 2004

Coram: McGrath J
Hammond J
O'Regan J

Appearances: A L Pinnock for Appellant
P K Feltham for Crown

Judgment: 13 July 2004

JUDGMENT OF THE COURT DELIVERED BY HAMMOND J

Introduction

[1]	Mrs Zhang was charged that between November 2001 and 13 March 2002 at Christchurch, Auckland and elsewhere she did conspire with other persons, by fraudulent means, namely the obtaining and possessing of paua for the purposes of sale otherwise than in accordance with the Fisheries Act 1996, to defraud the public of the economic benefit to be gained from that paua and depleting the paua resources of New Zealand. The indictment was framed, by the time the case came to trial, pursuant to s257 of the Crimes Act 1961.
[2]	Mrs Zhang pleaded "guilty" on arraignment in the District Court at Auckland. Subsequently, she was sentenced to three years imprisonment.
[3]	Mrs Zhang now appeals against both her conviction and the sentence to this Court.

Procedural matters

[4]	Before we turn directly to the grounds of appeal, there are two procedural matters we need to deal with. These matters can only be understood in the context of the now convoluted history of this case.
[5]	Mrs Zhang was originally charged, on 13 March 2002, with three offences (laid indictably) alleging offences against s233(1)(b) of the Fisheries Act 1996. In addition to those three charges she was charged summarily with having failed to provide her particulars to a Fisheries Officer. She pleaded "guilty" to that charge.
[6]	After committal for trial in December of 2002, an indictment was presented containing 11 counts alleging contraventions of s233(1)(b) of the Fisheries Act 1996.
[7]	The trial was then delayed pending the hearing by this Court of the appeal in R v Armstrong [2004] 1 NZLR 442. The decision in that case was delivered on 15 September 2003.
[8]	The practical effect of R v Armstrong was that the Crown could no longer proceed on the fisheries offences in which the available penalty was imprisonment. In the result, the Crown sought and obtained leave to amend the indictment by the substitution of a single count of conspiracy under s257 of the Crimes Act 1961. The maximum penalty for that offence is five years imprisonment.
[9]	Mrs Zhang’s trial was then scheduled to commence on 24 of November 2003. It was projected to take three weeks but a three-day fixture was requested for the hearing of pre-trial applications at the commencement of the trial.
[10]	What was sought to be encompassed by that single count were allegations that on six occasions in 2001 Mrs Zhang and others had conspired to export frozen paua in the luggage of tourists travelling from Christchurch to Hong Kong; that on three occasions an undercover Fisheries Officer had sold paua to Mrs Zhang; and that on 13 March 2002 a substantial quantity of paua was found in a freezer at the house in which the appellant lived.
[11]	It was on the morning of the trial - that is, 24 November 2003 - that Mrs Zhang, having indicated on the previous Friday that she would do so, pleaded guilty to the single count of conspiracy.

Procedure on the appeal to this Court

[12]	At the outset of the appeal the Court raised with counsel how it was that Mrs Zhang could plead guilty to the count of conspiracy and then appeal the conviction to this Court, a fortiori where one of the grounds of appeal in particular raised suggested evidential difficulties.
[13]	Mrs Pinnock said this issue had been canvassed between counsel and the Bench in the District Court. Effectively, it is said that Mrs Zhang pleaded guilty "under protest".
[14]	The trial Judge, Judge A-M J Bouchier, recorded the position which had been taken as follows:

Mrs Zhang pleaded guilty on arraignment in the District Court at Auckland on Monday 24 November. The plea of guilty was entered on the basis that her counsel intends to challenge a pre-trial ruling which was made granting the Crown leave to file an amended indictment. The purpose of this memorandum is to note that counsel for the Crown, Mr Pilditch and Mr Fletcher, and for the now prisoner, have all considered the matter and I have heard argument on it. At first blush, it appeared that a preservation of this right was possible under s 380 subs (3) of the Crimes Act. On a reading of the section it does not appear to bar this, however Mr Pilditch pointed out that in the commentary on Adams this right appeared to be narrowed to post a trial. S 383 of the Crimes Act has also been considered. Counsel for the Crown and counsel for the Defence were of the view that this was the most appropriate section under which the Defence could proceed. Accordingly, the Defence will be filling an appeal against the pre-trial ruling under this section.

[15]	With all due respect to counsel and the Judge, the procedure adopted was irregular. Resort could have been had, "either during or after the trial" to reserve a case for the opinion of this Court (see s380 of the Crimes Act 1961); alternatively, counsel could have sought a discharge under s347 of the Crimes Act 1961 to test the validity of the argument which she wished to pursue for Mrs Zhang.
[16]	The difficulty with what was done is that it is incontrovertible that the entry of a plea of guilty admits the validity of the offence; and all the necessary elements of that offence. No application was made pursuant to the Crimes Act (s356) to change that plea.
[17]	It follows, in our view, that in formal terms there was no jurisdiction for this appeal against conviction.

The continued existence of s257 of the Crimes Act 1961?

[18]	Mrs Zhang pleaded guilty to the charge under s257 on 24 November 2003. As from 17 November 2003 that section was revoked by the Crimes Amendment Act 2003. This substituted a new Part 10 of the Crimes Act 1961 relating to crimes against property, including a distinctly recast provision which was substituted for the repealed s257.
[19]	Given that the repeal of the section was prior to the plea, on what basis could the Crown still proceed on an indictment containing a count (s257) based on an entirely repealed provision? The answer is that the Crown’s ability to do so is preserved by s19(2)(b) of the Interpretation Act 1999.

The first ground of appeal

[20]	Notwithstanding our view that we have no jurisdiction on the conviction appeal, we think it appropriate to add some short observations on the merits, or rather the lack of them, of this appeal.
[21]	The first ground of appeal is that "the charge is based on a legal nullity insofar as there can be no conspiracy to defraud, in the absence of a valid prohibition against commercial dealing in paua".
[22]	It will be recalled that the effect of R v Armstrong was that at the time these offences were committed, s233(1)(b) of the Fisheries Act 1996 did not prohibit the export or possession of commercial quantities of fish for monetary gain.
[23]	It was precisely to avoid that difficulty that the Crown recast the prosecution in this case as a count under the former s257 of the Crimes Act 1961, in reliance on the decision in R v Walters [1993] 1 NZLR 533. Walters was a decision of a Full Court of this Court delivered by Cooke P. It held that a conspiracy to evade the Fisheries Act by fraudulent means could amount of a conspiracy in terms of the Crimes Act 1961. The circumstance that the obtaining amounted to a series of offences against s97 of the Fisheries Act did not of itself prevent the conduct being "fraudulent means" within the meaning of s257. The President acknowledged that this was a relatively "novel" use of s257, but it was not unlawful.
[24]	The history of this provision is set out in Simester and Brookbanks, Principles of Criminal Law (2 ed) at para 20.4, and we need not traverse that history extensively here. It suffices to say that the lawfulness of that use of s257 was authoritatively established in Walters.
[25]	As the law stood at the time of Walters, and for the purposes of this prosecution, the elements of a conspiracy to defraud under s257 were:
•	An agreement or conspiracy between two or more persons;
•	That contemplates the use of deceit, falsehood or fraudulent means;
•	To defraud the public, or to affect the price of anything sold publicly;
•	And the requisite mens rea.
[26]	All that Mrs Pinnock could appropriately do, as indeed she attempted to do, was to distinguish Walters. She said that in this instance there was no fraudulent act "such as the falsification of records for the purpose of deceiving, as in Walters and in R v Sew Hoy [1994] 1 NZLR 257".
[27]	However, in Walters, the President noted:

The essence of the Crown case is that the accused conspired together to obtain paua which had been illegally taken and disposed of it, principally by sending it to Australia by air and sea transport in containers purporting to hold only other commodities such as hoki, frozen vegetables and frozen potato chips (at 536).

[28]

As Ms Feltham said, and in our view entirely accurately, the false packaging in Walters was merely incidental. The same is true of this case: the fact that there was no specific offence to which the conduct was referable in the Fisheries Act is irrelevant, and the packaging or method adopted was merely incidental to the conspiracy.

Second ground of appeal: incorrect findings of fact at sentencing hearing

[29]	This ground of appeal is expressed thus:

Following the disputed facts hearing prior to sentencing, the [Judge] made findings of fact for which there was no evidential basis.

[30]

This ground of appeal was not proceeded on before us. Mrs Pinnock sensibly recognised that this ground of appeal related only to a very small quantity of paua in relation to the total sum involved in the case. The relevant figures under this head were minimal, and could have had no real bearing on the sentence appeal, to which we now turn.

Third ground of appeal: sentence

[31]	The sentence appeal is on the ground that the sentence imposed was manifestly excessive and wrong in principle.
[32]	In the District Court, Judge Bouchier proceeded on the footing that an extensive quantity of shucked paua had been illegally taken from New Zealand. She put the figure at 1,425 kilograms.
[33]	The Judge took a starting point of three years and nine months imprisonment, and gave nine months credit in recognition of the early guilty plea, and because the taxpayer had been saved "the full cost of a three-week trial".
[34]	The Judge paid particular regard to a decision of Salmon J in the High Court in Dewes v Ministry of Agriculture and Fisheries, HC/GIS, AP 20/02, 7 October 2002, in which that Judge held:

[18] In my view a small commercial operation would justify consideration of a non-custodial sentence. An operation of medium commercial size would justify a penalty in the range of one to two years and there could be some modification depending upon whether a fine was imposed as well. Penalties of three years and more would be reserved for large commercial operations.

[35]	Dewes was a case in which there had been two sales of paua meat (81.5 kilograms) to an undercover officer, with a value of $7,300. The sentencing Judge had imposed a sentence of 12 months imprisonment and had refused leave to apply for home detention. Salmon J reduced the sentence to nine months imprisonment, with leave to apply for home detention.
[36]	Mrs Pinnock noted that five years imprisonment is the maximum available sentence under s257. Under s8(d) of the Sentencing Act 2002 a penalty near to the maximum is to be prescribed only "if the offending is near to the most serious of cases for which that penalty is prescribed". She submitted this was not a large commercial operation in the sense of the cases involved in Operation Pacman, which involved the greatest degree of offending ever known in New Zealand (5.5 tonnes, $880,000). There, the sentences imposed on the various defendants ranged from one year with leave to apply for home detention, through to four years for the most culpable offender.
[37]	Mrs Pinnock also referred to a number of District Court prosecutions which, from 1993 through to 2002, produced sentences (apart from fines) of six months imprisonment (suspended) to sentences of 18 months imprisonment with leave to apply for home detention.
[38]	Of those cases, probably the closest to the instant case was Ministry of Agriculture and Fisheries v Tuala (District Court, 7 November 2000). That case was charged as a conspiracy case. The ringleader was observed on several occasions to remove a large quantity of paua (1,492 kilograms, in excess of $16,000). This defendant had a number of convictions for dishonesty offences. He was sentenced to 18 months imprisonment with leave to apply for home detention.
[39]	Given these sentences, Mrs Pinnock’s principal submission was that the sentence actually imposed in this case is distinctly out of line with the sentences imposed in other courts over (approximately) the last decade which, although they have tended to increase from perhaps nine months to 18 months, nevertheless fall well short of three years.
[40]	Ms Feltham supported the sentence. In particular, she placed reliance on Dewes (supra) and she noted that one of the appellants in Ministry of Fisheries v Kaewta and Others (District Court, 11 December 2002) had also received a sentence of three years imprisonment. There, although the quantity of fish involved was greater, Mr Ku received a considerable discount for his guilty plea. Ms Feltham submitted that the final sentence in this case of three years imprisonment could not be regarded as manifestly excessive, or wrong in principle.
[41]	In the end, we have come to the view that we should intervene in this instance, principally because the sentence is distinctly out of line with offences at the time of the offending, and sentences imposed therefore. In that connection it has to be recalled that this proceeding has been on foot now for close to three years. In the intervening period there has been much greater official and public awareness of these depredations; the law has been clarified and amended; and there can now be no doubt that offenders will face much stiffer sentences.
[42]	We agree with Salmon J that, in general terms, for anything other than minimal commercial operations - and Mrs Pinnock did not take issue with this - offenders today face imprisonment. In the case of large scale commercial operations, sentences of three or four years, in really serious cases, would not be inappropriate given the public interest in the protection of this fish stock.
[43]	In the result, we think that fairness requires a degree of parity in this particular instance to like sentences at the time of the offences; but prospectively, serious offenders (and this was serious offending) will not warrant the same consideration.
[44]	We set aside the sentence of three years imprisonment. We substitute therefore a sentence of two years imprisonment. The appellant will have leave to apply for home detention.

Solicitors:
Luke Cunningham & Clere, Wellington for Crown