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The Queen v Bryan and ors [2006] NZCA 161 (6 July 2006)

Last Updated: 19 July 2006

IN THE COURT OF APPEAL OF NEW ZEALAND

CA239/05
CA240/05
CA250/05
CA251/05
CA277/05
CA318/05

THE QUEEN

v

CRAIG PAUL BRYAN (CA239/05)
CRAIG GREGORY OTTER (CA240/05)
GREGORY OSCAR OLSEN (CA250/05)
DONNA MARISE WILSON (CA251/05)
RICHARD JOHN SAMUEL TE RURE (CA277/05)
JASON THOMAS SCULLY (CA318/05)

Hearing: 24 May 2006

Court: O'Regan, Arnold and Ellen France JJ

Counsel: S B Manning for Bryan
D H Quilliam for Otter
S Jefferson for Olsen
A J S Snell for Wilson
N C H Hewat for Te Rure
D La Hood for Scully
M Downs and K E Salmond for Crown

Judgment: 6 July 2006

JUDGMENT OF THE COURT

A In the case of Mr Te Rure, the appeal against sentence is allowed. The sentence of 12 years with a minimum period of imprisonment of 8 years on the manufacturing methamphetamine charge is set aside. We substitute a sentence of 101/2 years imprisonment with a minimum period of imprisonment of 7 years. All the concurrent sentences will remain as fixed by the High Court.
B In the case of Ms Wilson, the appeal against sentence is allowed. The sentence of 10 years imprisonment with a minimum period of imprisonment of 6 years on the manufacturing charge is set aside. We substitute a sentence of 9 years imprisonment with a minimum period of imprisonment of 5 years. The concurrent sentence remains as fixed by the High Court.
C In the case of Mr Otter, the appeal against sentence is allowed. The sentence of 7 years with a minimum period of imprisonment of 4 years is set aside. We substitute a sentence of 6 years imprisonment with no minimum period of imprisonment.
D In the case of Mr Scully, the appeal against sentence is allowed. The sentence of 9 years imprisonment with a minimum period of imprisonment of 5 years on the conspiracy to manufacture methamphetamine charge is set aside. We substitute a sentence of 6 years 6 months imprisonment with no minimum period of imprisonment. All the concurrent sentences will remain as fixed by the High Court.
E In the case of Mr Bryan, the appeal against sentence is allowed. The sentence of 5 years 9 months is set aside. We substitute a sentence of 41/2 years imprisonment.
F In the case of Mr Olsen, the appeal against sentence is allowed. The sentence of 51/2 years is set aside. We substitute a sentence of 4 years 3 months imprisonment.

REASONS OF THE COURT

(Given by Ellen France J)

Table of Contents

Para No
Introduction [1]
Factual background [3]
Approach to sentencing [8]
The appropriate guideline [11]
Seriousness of this offending [15]
Recognition of lesser maximum [19]
Test for imposition of minimum period of imprisonment [20]
Assessment of culpability [21]
Richard Te Rure [23]
Donna Wilson [33]
Craig Otter [46]
Jason Scully [53]
Craig Bryan [59]
Gregory Olsen [66]
Result [70]

Introduction

[1] The appellants all pleaded guilty after committal for trial to a number of drug-related charges arising out of a Police surveillance operation in Napier. The appellants appeal against sentences imposed on them in relation to this offending by MacKenzie J on 30 June 2005 on the basis those sentences are manifestly excessive and/or wrong in principle.
[2] These appeals were heard together with another appeal against sentence brought by Michael Te Nahu CA270/05. His offending involved a similar operation in the Hawkes Bay. A separate judgment is being issued in relation to Mr Te Nahu’s appeal.

Factual background

[3] The surveillance operation focused on activities at a Housing New Zealand property occupied by the appellants Richard Te Rure and Donna Wilson. The operation revealed that over a period of some two and a half months from 16 May 2004 manufacturing of methamphetamine on a large scale took place at the property. The manufacturing enterprise was well organised with manufacturing taking place on an almost daily basis. On occasions one batch would be at one stage in the process while another batch was at a different stage.
[4] Richard Te Rure obtained pseudoephedrine-based medications from a number of sources to keep the operation going. Ms Wilson was overheard to say that 10 grams was the minimum amount of ephedrine required for a "cook" with 50 to 100 grams described as worthwhile. The summary of facts records that 100 grams of ephedrine will produce 40 to 80 grams of pure methamphetamine. One gram of methamphetamine sells for between $700 and $1,000.
[5] There were six children living at the address throughout the period, some of whom were of school age.
[6] The contamination caused by the manufacturing operation was such that the house was rendered unfit for human habitation and had to be demolished. The total cost to Housing New Zealand was nearly $185,000.
[7] The appellants, other than Richard Te Rure and Donna Wilson, all assisted in various ways in the manufacturing enterprise.

Approach to sentencing

[8] In broad terms, the approach taken by MacKenzie J was to establish first the nature and seriousness of the offending. On this, the Judge described the enterprise as "ongoing, extending over several months" and involving "regular and frequent manufacture." MacKenzie J continued:

It is clear that a very large quantity of drugs, with a very large value, was produced and introduced into the market. The operation was highly sophisticated, involving batch manufacture with several stages in the process being carried out at the same time. I regard it as being commercial activity on a major scale. Children were placed at risk and were used in furtherance of the operation. Major damage to the property of an innocent victim was caused.

[9] MacKenzie J then identified the culpability of each of the appellants and determined their relative culpabilities. Richard Te Rure was sentenced on the basis he was the mastermind with Donna Wilson as the second in charge.
[10] The submissions, to greater or lesser degrees, raise a number of general points. We deal with those now before turning to the individual appellants.

The appropriate guideline

[11] The first question is the appropriate sentencing guideline to be applied. The submission made on behalf of Mr Te Rure and Mr Scully is that the Judge has been influenced by the expectation that this Court would increase sentences for manufacturing (anticipating R v Fatu [2006] 2 NZLR 72). It is argued that to sentence on the basis of an anticipated new tariff offends against the spirit, if not the exact terms, of s 25(g) of the New Zealand Bill of Rights Act 1990 and of s 6 of the Sentencing Act 2002. Section 25(g) provides that those charged with an offence have the right, if convicted of an offence "in respect of which the penalty has been varied" between the date of offending and sentencing, to the benefit of the lesser penalty. Section 6(1), similarly, provides for the right of the offender if convicted of an offence "in respect of which the penalty has been varied" between the offending and sentencing, to the benefit of the lesser penalty.
[12] The appropriate sentencing guideline for these sentences was that set out in R v Arthur [2005] 3 NZLR 739. While the offending occurred prior to that decision, the guilty pleas were all taken after Arthur had been delivered. The position equates with the direction in Fatu at [44] that the High Court should apply the guidelines in Fatu in all methamphetamine cases where a plea of guilty is entered or a finding of guilt is made after the date of the delivery of that decision. The Judge refers to Arthur and it appears from the starting points adopted that Arthur has been applied although this is not expressly stated.
[13] There was a submission to MacKenzie J from counsel for Mr Te Rure that Mr Te Rure should be sentenced on a similar basis as adopted by Ronald Young J in sentencing Mr Te Nahu. Because of that submission, MacKenzie J in setting the starting point for Mr Te Rure makes the observation that Mr Te Rure’s offending was more serious than that of Mr Te Nahu such that a higher starting point was appropriate for Mr Te Rure.
[14] Given that this Court in Arthur at [27] specifically referred to the expectation that manufacturing was likely to attract much higher sentences than selling, we see no problems in terms of the principles of retrospectivity or of fairness in the Judge sentencing the appellants on the basis of a higher sentence than would be appropriate for selling the same amount. As will be seen, we agree with MacKenzie J’s assessment of the seriousness of the offending. That analysis would put the offending into category 3 of R v Wallace and Christie [1999] 3 NZLR 159 i.e. commercial activity on a major scale. It follows that, as the Crown submits, either on the application of Arthur or of R v Wallace and Christie the approach taken, in general terms, does not offend against the principles of retrospectivity or fairness more generally.

Seriousness of this offending

[15] The second general issue is the categorisation of the offending. A number of the submissions addressed this. We consider this offending falls within category 3 in Arthur with an increase appropriate for the fact of manufacturing.
[16] This Court in Arthur identified the following starting points:
 Low level supply: 2 to 4 years imprisonment;
 Commercial quantity: 3 to 9 years imprisonment;
 Large commercial quantity: 8 years or more.
[17] No issue can be taken with MacKenzie J’s assessment that this was a sophisticated operation reflecting commercial activity on a major scale. It continued over a significant period of time. Further, although there is little information about the amounts produced, we accept the Crown submission that the conclusion is inescapable that in excess of 250 grams would have been produced. This Court in Arthur noted that, in terms of the New South Wales bands, the third category involved commercial quantities of 250 grams plus. Taking Ms Wilson’s figures about what was worthwhile production, on a conservative analysis regular production on an almost daily basis for a period of two and a half months takes this into that large commercial quantity category.
[18] In addition, there is the aggravating feature of the involvement of young children both in terms of the risk to which they were exposed and their involvement in the offending by being given tasks such as purchasing supplies. Finally, there is the damage to the property requiring its demolition.

Recognition of lesser maximum

[19] The third general submission arises from the fact that the four appellants, other than Mr Te Rure and Ms Wilson, were convicted of conspiracy to manufacture methamphetamine. Mr Te Rure and Ms Wilson were sentenced for manufacturing. When sentencing the others, the Judge made no express reference to the lesser maximum term for conspiracy (14 years rather than life). The associated submission is that the Judge has worked out the appropriate starting point for the other four appellants based on the approach taken to Mr Te Rure and simply worked downwards, ignoring the lesser charge. These submissions advance the appellants’ case to a point. However, as the Crown says, this is not a case of a conspiracy which has not come to fruition. It has. Further as the Crown also submits, the ultimate issue is whether the final sentence is appropriate. With these caveats, as will be seen from our discussion of the individual appellants we do consider there has been a difficulty in the approach ultimately reached in this context.

Test for imposition of minimum period of imprisonment

[20] Fourth, in respect of Mr Scully and Mr Otter, there is the added complication that their offending occurred during the period where the statutory test (in s 86 of the Sentencing Act 2002) for the imposition of a minimum period of imprisonment changed. Applying the principles of this Court’s decision in R v Chadderton [2004] NZCA 295; (2004) 21 CRNZ 566, we agree that the preferable approach would have been to apply the old test. That has implications for these two appellants.

Assessment of culpability

[21] Finally, some appellants challenge MacKenzie J’s assessment of culpability and of relative culpabilities as between the appellants. We take the view that the Judge was best placed to assess these matters. MacKenzie J’s assessment is plainly based on the summary of facts to which all have pleaded and counsel do not point to any departure from that or identify any substantive way in which the Judge has erred.
[22] With these general points in mind, we turn to consider the appellants individually.

Richard Te Rure

[23] Mr Te Rure was sentenced to a term of 12 years imprisonment with a minimum period of imprisonment of eight years. The term was imposed on the lead charge of manufacturing methamphetamine over the period 16 May to 28 July 2004. Concurrent terms of three years imprisonment were imposed on a further charge of possession of a precursor substance and on a charge of selling cannabis.
[24] In relation to the manufacturing of methamphetamine, as we have noted, MacKenzie J treated Mr Te Rure as the mastermind of the enterprise. No issue is taken with that assessment. The other offending arose in the following way. First, Mr Te Rure was arrested on 28 July 2004 and was released on bail. The day after his release, he was arrested at a different address with a precursor substance. This gave rise to the charge of possession of a precursor substance. Second, the cannabis selling charge related to 28 ounces of cannabis bought by Mr Te Rure and Ms Wilson which was on-sold to another family member.
[25] In assessing the appropriate starting point, as we have said, MacKenzie J treated this offending as more serious than that in Mr Te Nahu’s case where Ronald Young J had taken a 101/2 year starting point, including personal aggravating features. MacKenzie J took a 121/2 year starting point. Three aggravating features personal to Mr Te Rure were identified as warranting an increase in sentence to 15 years, namely:

(a) prior offending in 1998 involving a Class A controlled drug for which Mr Te Rure was sentenced to a term of imprisonment of five and a half years;

(b) the fact that the precursor substance offending occurred while on bail; and

[26] The only mitigating factor identified was Mr Te Rure’s guilty plea.
[27] The principal challenge to the sentence imposed on Mr Te Rure is that the starting point of 121/2 years was too high reflecting an improper consideration of the increase in sentences in anticipation of this Court’s decision in Fatu. That submission has been dealt with.
[28] Mr Hewat on behalf of Mr Te Rure also sought to categorise this offending as at the top-end of category 2 in R v Wallace and Christie and so warranting a starting point towards the top of the five to eight year range. Category 2 in Wallace and Christie broadly equates to category 2 in Arthur and Mr Hewat acknowledged that his was an optimistic submission given the sophistication and regularity of the manufacturing process. Mr Hewat similarly accepted MacKenzie J could draw the inference he did about the quantity of methamphetamine produced.
[29] Finally, Mr Hewat submitted Mr Te Rure’s offending was more on a par with that of Mr Te Nahu. That submission has no merit given the period of time involved in this offending, the regularity of manufacturing and so on. While Mr Te Nahu’s offending was serious, involving both manufacturing and various offences with precursor substances, it occurred on a less regular basis and over a shorter period of time. We are satisfied that the relativity between the sentence imposed on Mr Te Nahu and that imposed on Mr Te Rure and, indeed, all of the appellants, is appropriate.
[30] A starting point of 121/2 years imprisonment was at the highest end of the range. That, together with the Judge’s strong response to the personal aggravating features has resulted in an overall sentence which is manifestly excessive. Although this was serious offending with a number of personal aggravating features, when viewed overall a 15 year sentence was too high. The appropriate sentence without consideration of the guilty plea was 131/2 years imprisonment.
[31] Mr Hewat takes no issue with the level of reduction for the guilty plea or with the minimum term. We agree that both were appropriate and so we substitute a sentence which is reduced by the same proportion, with a minimum term reflecting the two-thirds adopted by MacKenzie J.
[32] This appeal is accordingly allowed. The sentence of 12 years with a minimum period of imprisonment of eight years on the manufacturing methamphetamine charge is set aside. We substitute a sentence of 101/2 years imprisonment with a minimum period of imprisonment of seven years. All the concurrent sentences will remain as fixed by the High Court.

Donna Wilson

[33] Ms Wilson faced two charges, one of manufacturing methamphetamine over the period 16 May to 28 July 2004, and one of selling cannabis. The cannabis was the 28 ounces which she and Mr Te Rure on-sold to a family member.
[34] Ms Wilson was sentenced to a term of ten years imprisonment with a minimum period of imprisonment of six years on the manufacturing charge. A concurrent term of two and a half years imprisonment was imposed on the sale of cannabis charge.
[35] As we have noted, MacKenzie J sentenced Ms Wilson on the basis she was the "second in charge" of the operation. His Honour described her as directing others and having a knowledge of the scale and running of the enterprise.
[36] MacKenzie J considered an increase in sentence of 18 months from the starting point of 11 years was appropriate to reflect two personal aggravating features, namely, the cannabis offending and previous convictions in 2005 for methamphetamine related offending for which Ms Wilson was sentenced to a term of five months imprisonment.
[37] It now is apparent that this offending took place while Ms Wilson was on bail for the methamphetamine-related offending which resulted in her 2005 convictions. Those convictions in fact related to offending in 2003. The fact that this offending took place while Ms Wilson was on bail does not appear to have been drawn to MacKenzie J’s attention and is a further personal aggravating feature.
[38] From a sentence of 121/2 years, a discount was given for the guilty plea, resulting in an end sentence of ten years imprisonment with a minimum period of imprisonment of six years.
[39] Mr Snell’s submission on behalf of Ms Wilson was that the starting point of 11 years was too high given, first, this was category 2 offending in terms of Arthur and, second, bearing in mind the reality of Ms Wilson’s involvement. The Crown submits that the summary of facts makes it plain Ms Wilson’s role was a leading one and argues that the starting point reflects the seriousness of her offending.
[40] As to the first point raised by Mr Snell, we have already said this offending was properly characterised as category 3 in Arthur terms, with an increase for manufacturing. The starting point was, however, at the highest end.
[41] We have made it clear we do not intend to interfere with the sentencing Judge’s assessment of culpability and of relative culpabilities. Moreover, we reject Mr Snell’s submission that Ms Wilson, while the "second in command", in reality acted at the behest of Mr Te Rure. The summary of facts records a course of conduct by Ms Wilson consistent with an independence of action on her part. The summary of facts also demonstrates that she knew well the various processes involved and participated in them. She told the pre-sentence report writer that she was "in it" for the money. It follows from this that we do not accept the further submission that there should have been a greater difference between the sentence imposed on Ms Wilson and that imposed on Mr Te Rure.
[42] Applying the reasoning we took in relation to Mr Te Rure, we do however accept the submission that the overall sentence, with a starting point at the highest end and with a strong response for the personal aggravating features, was manifestly excessive. The appropriate starting point was 11 years.
[43] From that starting point, an appropriate end sentence is nine years imprisonment. Ms Wilson did plead early.
[44] There is no challenge to the imposition of a minimum term reflecting two-thirds of the total sentence.
[45] The appeal against sentence is allowed. The sentence of ten years imprisonment with a minimum period of imprisonment of six years on the manufacturing charge is set aside. We substitute a sentence of nine years imprisonment with a minimum period of imprisonment of five years. The concurrent sentence remains as fixed by the High Court.

Craig Otter

[46] Mr Otter was sentenced to a term of imprisonment of seven years with a minimum period of imprisonment of four years on one count of conspiracy to manufacture methamphetamine over the period 16 May to 28 July 2004. MacKenzie J described Mr Otter as having assisted the enterprise in a number of ways, visiting the address on numerous occasions and for lengthy periods. MacKenzie J said that in addition to transporting chemicals and equipment, Mr Otter also took part in the manufacturing process on a number of occasions. He too was seen as well aware of the circumstances and of the dangers to which the young children were being exposed. A starting point of nine years imprisonment was taken. The only mitigating feature was the guilty plea for which a reduction of two years was seen as appropriate.
[47] A minimum term was imposed to reflect the extent of Mr Otter’s role and the fact that a previous term of imprisonment had not deterred Mr Otter from this type of offending.
[48] Mr Quilliam sought to have the Court take a different view from that of MacKenzie J on the level of Mr Otter’s involvement. As we have indicated, we do not see any basis for doing that.
[49] We do accept that the lesser nature of the charge faced by Mr Otter is a factor which has probably not received adequate attention. If this factor had been overlaid with MacKenzie J’s analysis, that would have led to a starting point of around seven years three months. MacKenzie J took into account Mr Otter’s previous serious drug-related offending in deciding to impose a minimum period of imprisonment. We believe that this factor should have been treated as a personal aggravating feature warranting an increase in sentence to eight years. With a reduction for the guilty plea of about the same proportion given by MacKenzie J, that leads to an end sentence of six years.
[50] As we have explained, the Judge should have applied the test for the imposition of a minimum period as it was prior to the amendment of s 86. The Crown submission is that under either form of s 86, the test is met given the seriousness of the offending, its scale and the involvement of children.
[51] The Judge imposed a minimum term on the basis of Mr Otter’s role in this offending and due to the fact that a previous term of imprisonment had not deterred Mr Otter from further offending in the same way. Applying R v Brown [2002] 3 NZLR 670 at [29], the factors identified by MacKenzie J are not circumstances of the offence which put this offending in the "sufficiently serious" category such as to warrant a minimum term. Nor do the matters emphasised by the Crown take this offending into that category. The test for the imposition of a minimum term which then applied was not met.
[52] The appeal against sentence is allowed. The sentence of seven years with a minimum period of imprisonment of four years is set aside. We substitute a sentence of six years imprisonment with no minimum period of imprisonment.

Jason Scully

[53] Mr Scully was sentenced to a term of nine years imprisonment with a minimum period of imprisonment of five years on a charge of conspiracy to manufacture methamphetamine over the period from 16 May to 28 July 2004. Mr Scully faced two other charges of possession of precursor substances which related to him being found with those substances on 23 February 2005. On each of those two charges, he was sentenced to terms of two years all to be served concurrently.
[54] Again, MacKenzie J described Mr Scully as being fully involved in the operation - assisting in the manufacturing process on a number of occasions, delivering finished product; purchasing and obtaining items to be used in the manufacturing process, transporting items to and from the address and undertaking a number of other tasks under the direction of Mr Te Rure.
[55] Mr Scully’s level of involvement was seen as "broadly comparable" to that of Mr Otter. A starting point of nine years was accordingly adopted. However, unlike Mr Otter, there was an aggravating feature, namely, that while on bail for this offending Mr Scully had committed the offending involving the precursor substances. MacKenzie J also placed some emphasis on the fact that part of Mr Scully’s offending on these charges occurred after the arrest of Richard Te Rure and others on 28 July 2004. Accordingly, from the nine year starting point, MacKenzie J added two years to make a sentence of 11 years imprisonment. That was reduced for the guilty plea to a nine year end term. The level of Mr Scully’s involvement and the need for deterrence, given Mr Scully’s continued offending, was seen to warrant a minimum term of five years.
[56] We have already dealt with the retrospectivity argument raised by Mr La Hood in relation to Mr Scully’s offending. Mr La Hood also sought to make something of the disparity in sentence between Mr Scully and Mr Otter. Again, we accept MacKenzie J’s assessment of relative culpabilities. We do, however, agree that the increase of two years from the starting point for the fact Mr Scully offended while on bail was too high. We do not consider that the fact Mr Scully continued to offend after the arrest of the others was an aggravating factor warranting an increase.
[57] As with Mr Otter, a downward adjustment was necessary to reflect the lesser, conspiracy, charge. With these factors in mind, the appropriate starting point was seven years three months with an increase in sentence to eight years three months for personal aggravating features. There was no challenge to the reduction for the guilty plea. Using about the same percentage reduction as applied by MacKenzie J would lead to an end sentence of six years six months. For the same reasons applicable to Mr Otter, we accept Mr La Hood’s submission that the test for a minimum period of imprisonment which then applied was not met.
[58] The appeal against sentence is allowed. The sentence of nine years imprisonment with a minimum period of imprisonment of five years on the conspiracy to manufacture methamphetamine charge is set aside. We substitute a sentence of six years six months imprisonment with no minimum period of imprisonment. All the concurrent sentences will remain as fixed by the High Court.

Craig Bryan

[59] Mr Bryan was sentenced to a term of imprisonment of five years, nine months on one charge of conspiracy to manufacture methamphetamine over the period 16 May to 28 July 2004.
[60] Mr Bryan’s role was the storage of goods, transportation of equipment, and he did take some part in manufacturing on one occasion.
[61] MacKenzie J assessed Mr Bryan’s level of culpability as slightly lower than that of Mr Otter and Mr Scully. From a starting point of seven and a half years imprisonment the term was reduced to five years, nine months in recognition of his guilty plea.
[62] The submission for Mr Bryan is that any higher starting point than six years with an end sentence of four years imprisonment is manifestly excessive for a secondary party. The starting point adopted does not reflect the extent of Mr Bryan’s involvement or his role relative to that of Mr Scully and Mr Otter. Mr Manning also submits that a comparison with other cases involving persons filling Mr Bryan’s role in this enterprise shows the sentence imposed is out of line.
[63] For the reasons we have given we consider no issue can be taken with MacKenzie J’s assessment of culpability nor with that of relative levels of culpability as amongst the appellants. It is also necessary to keep in mind the nature of the enterprise in which Mr Bryan, like the others, was conspiring. This was serious offending.
[64] As with the other appellants facing conspiracy charges, overlaying that aspect on MacKenzie J’s analysis, the starting point of seven and a half years adopted for Mr Bryan was too high. A starting point of six years was appropriate. There are no personal aggravating features. Adopting about the same percentage reduction for the guilty plea would lead to an end sentence of four and a half years imprisonment.
[65] The appeal against sentence is allowed. The sentence of five years nine months is set aside. We substitute a sentence of four and a half years imprisonment.

Gregory Olsen

[66] Mr Olsen was sentenced to a term of imprisonment of five and a half years on one count of conspiracy to manufacture methamphetamine over the period 16 May to 28 July 2004. MacKenzie J described him as Mr Te Rure’s "lieutenant". He had responsibility for storage and transportation of chemicals and assisted on one occasion in manufacture. MacKenzie J saw Mr Olsen’s involvement as equating to that of Mr Bryan but "slightly lower". From a starting point of seven years imprisonment there was a reduction in the term in recognition of the guilty plea to a term of five and a half years imprisonment.
[67] Mr Jefferson makes similar submissions about the need to recognise that Mr Olsen’s offending involved the lesser conspiracy charge. He, too, submits the assessment of level of culpability is not correct, suggesting rather that Mr Olsen’s involvement was a little below that of Mr Bryan. It is also submitted a greater discount for the guilty plea should have been given.
[68] Applying the reasoning taken to the other appellants sentenced on the conspiracy charge, the starting point for Mr Olsen was excessive. The appropriate starting point is five and a half years imprisonment. There are no personal aggravating features. We are not satisfied there should be any greater discount for Mr Olsen’s guilty plea than applies to the other appellants although the reduction for Ms Wilson is slightly higher. With a reduction of about 21% for the guilty plea, the appropriate end sentence is four years three months imprisonment.
[69] The appeal against sentence is allowed. The sentence of five and a half years is set aside. We substitute a sentence of four years three months imprisonment.

Result

[70] The appeals against sentence are allowed. Sentences are substituted as set out above.

Solicitors:
Sladden Cochrane & Co, Wellington for Scully
Crown Law Office, Wellington

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[1]	The appellants all pleaded guilty after committal for trial to a number of drug-related charges arising out of a Police surveillance operation in Napier. The appellants appeal against sentences imposed on them in relation to this offending by MacKenzie J on 30 June 2005 on the basis those sentences are manifestly excessive and/or wrong in principle.
[2]	These appeals were heard together with another appeal against sentence brought by Michael Te Nahu CA270/05. His offending involved a similar operation in the Hawkes Bay. A separate judgment is being issued in relation to Mr Te Nahu’s appeal.

[3]	The surveillance operation focused on activities at a Housing New Zealand property occupied by the appellants Richard Te Rure and Donna Wilson. The operation revealed that over a period of some two and a half months from 16 May 2004 manufacturing of methamphetamine on a large scale took place at the property. The manufacturing enterprise was well organised with manufacturing taking place on an almost daily basis. On occasions one batch would be at one stage in the process while another batch was at a different stage.
[4]	Richard Te Rure obtained pseudoephedrine-based medications from a number of sources to keep the operation going. Ms Wilson was overheard to say that 10 grams was the minimum amount of ephedrine required for a "cook" with 50 to 100 grams described as worthwhile. The summary of facts records that 100 grams of ephedrine will produce 40 to 80 grams of pure methamphetamine. One gram of methamphetamine sells for between $700 and $1,000.
[5]	There were six children living at the address throughout the period, some of whom were of school age.
[6]	The contamination caused by the manufacturing operation was such that the house was rendered unfit for human habitation and had to be demolished. The total cost to Housing New Zealand was nearly $185,000.
[7]	The appellants, other than Richard Te Rure and Donna Wilson, all assisted in various ways in the manufacturing enterprise.

[9]	MacKenzie J then identified the culpability of each of the appellants and determined their relative culpabilities. Richard Te Rure was sentenced on the basis he was the mastermind with Donna Wilson as the second in charge.
[10]	The submissions, to greater or lesser degrees, raise a number of general points. We deal with those now before turning to the individual appellants.

[11]	The first question is the appropriate sentencing guideline to be applied. The submission made on behalf of Mr Te Rure and Mr Scully is that the Judge has been influenced by the expectation that this Court would increase sentences for manufacturing (anticipating R v Fatu [2006] 2 NZLR 72). It is argued that to sentence on the basis of an anticipated new tariff offends against the spirit, if not the exact terms, of s 25(g) of the New Zealand Bill of Rights Act 1990 and of s 6 of the Sentencing Act 2002. Section 25(g) provides that those charged with an offence have the right, if convicted of an offence "in respect of which the penalty has been varied" between the date of offending and sentencing, to the benefit of the lesser penalty. Section 6(1), similarly, provides for the right of the offender if convicted of an offence "in respect of which the penalty has been varied" between the offending and sentencing, to the benefit of the lesser penalty.
[12]	The appropriate sentencing guideline for these sentences was that set out in R v Arthur [2005] 3 NZLR 739. While the offending occurred prior to that decision, the guilty pleas were all taken after Arthur had been delivered. The position equates with the direction in Fatu at [44] that the High Court should apply the guidelines in Fatu in all methamphetamine cases where a plea of guilty is entered or a finding of guilt is made after the date of the delivery of that decision. The Judge refers to Arthur and it appears from the starting points adopted that Arthur has been applied although this is not expressly stated.
[13]	There was a submission to MacKenzie J from counsel for Mr Te Rure that Mr Te Rure should be sentenced on a similar basis as adopted by Ronald Young J in sentencing Mr Te Nahu. Because of that submission, MacKenzie J in setting the starting point for Mr Te Rure makes the observation that Mr Te Rure’s offending was more serious than that of Mr Te Nahu such that a higher starting point was appropriate for Mr Te Rure.
[14]	Given that this Court in Arthur at [27] specifically referred to the expectation that manufacturing was likely to attract much higher sentences than selling, we see no problems in terms of the principles of retrospectivity or of fairness in the Judge sentencing the appellants on the basis of a higher sentence than would be appropriate for selling the same amount. As will be seen, we agree with MacKenzie J’s assessment of the seriousness of the offending. That analysis would put the offending into category 3 of R v Wallace and Christie [1999] 3 NZLR 159 i.e. commercial activity on a major scale. It follows that, as the Crown submits, either on the application of Arthur or of R v Wallace and Christie the approach taken, in general terms, does not offend against the principles of retrospectivity or fairness more generally.

[15]	The second general issue is the categorisation of the offending. A number of the submissions addressed this. We consider this offending falls within category 3 in Arthur with an increase appropriate for the fact of manufacturing.
[16]	This Court in Arthur identified the following starting points:
	Low level supply: 2 to 4 years imprisonment;
	Commercial quantity: 3 to 9 years imprisonment;
	Large commercial quantity: 8 years or more.
[17]	No issue can be taken with MacKenzie J’s assessment that this was a sophisticated operation reflecting commercial activity on a major scale. It continued over a significant period of time. Further, although there is little information about the amounts produced, we accept the Crown submission that the conclusion is inescapable that in excess of 250 grams would have been produced. This Court in Arthur noted that, in terms of the New South Wales bands, the third category involved commercial quantities of 250 grams plus. Taking Ms Wilson’s figures about what was worthwhile production, on a conservative analysis regular production on an almost daily basis for a period of two and a half months takes this into that large commercial quantity category.
[18]	In addition, there is the aggravating feature of the involvement of young children both in terms of the risk to which they were exposed and their involvement in the offending by being given tasks such as purchasing supplies. Finally, there is the damage to the property requiring its demolition.

[23]	Mr Te Rure was sentenced to a term of 12 years imprisonment with a minimum period of imprisonment of eight years. The term was imposed on the lead charge of manufacturing methamphetamine over the period 16 May to 28 July 2004. Concurrent terms of three years imprisonment were imposed on a further charge of possession of a precursor substance and on a charge of selling cannabis.
[24]	In relation to the manufacturing of methamphetamine, as we have noted, MacKenzie J treated Mr Te Rure as the mastermind of the enterprise. No issue is taken with that assessment. The other offending arose in the following way. First, Mr Te Rure was arrested on 28 July 2004 and was released on bail. The day after his release, he was arrested at a different address with a precursor substance. This gave rise to the charge of possession of a precursor substance. Second, the cannabis selling charge related to 28 ounces of cannabis bought by Mr Te Rure and Ms Wilson which was on-sold to another family member.
[25]	In assessing the appropriate starting point, as we have said, MacKenzie J treated this offending as more serious than that in Mr Te Nahu’s case where Ronald Young J had taken a 101/2 year starting point, including personal aggravating features. MacKenzie J took a 121/2 year starting point. Three aggravating features personal to Mr Te Rure were identified as warranting an increase in sentence to 15 years, namely:

[26]	The only mitigating factor identified was Mr Te Rure’s guilty plea.
[27]	The principal challenge to the sentence imposed on Mr Te Rure is that the starting point of 121/2 years was too high reflecting an improper consideration of the increase in sentences in anticipation of this Court’s decision in Fatu. That submission has been dealt with.
[28]	Mr Hewat on behalf of Mr Te Rure also sought to categorise this offending as at the top-end of category 2 in R v Wallace and Christie and so warranting a starting point towards the top of the five to eight year range. Category 2 in Wallace and Christie broadly equates to category 2 in Arthur and Mr Hewat acknowledged that his was an optimistic submission given the sophistication and regularity of the manufacturing process. Mr Hewat similarly accepted MacKenzie J could draw the inference he did about the quantity of methamphetamine produced.
[29]	Finally, Mr Hewat submitted Mr Te Rure’s offending was more on a par with that of Mr Te Nahu. That submission has no merit given the period of time involved in this offending, the regularity of manufacturing and so on. While Mr Te Nahu’s offending was serious, involving both manufacturing and various offences with precursor substances, it occurred on a less regular basis and over a shorter period of time. We are satisfied that the relativity between the sentence imposed on Mr Te Nahu and that imposed on Mr Te Rure and, indeed, all of the appellants, is appropriate.
[30]	A starting point of 121/2 years imprisonment was at the highest end of the range. That, together with the Judge’s strong response to the personal aggravating features has resulted in an overall sentence which is manifestly excessive. Although this was serious offending with a number of personal aggravating features, when viewed overall a 15 year sentence was too high. The appropriate sentence without consideration of the guilty plea was 131/2 years imprisonment.
[31]	Mr Hewat takes no issue with the level of reduction for the guilty plea or with the minimum term. We agree that both were appropriate and so we substitute a sentence which is reduced by the same proportion, with a minimum term reflecting the two-thirds adopted by MacKenzie J.
[32]	This appeal is accordingly allowed. The sentence of 12 years with a minimum period of imprisonment of eight years on the manufacturing methamphetamine charge is set aside. We substitute a sentence of 101/2 years imprisonment with a minimum period of imprisonment of seven years. All the concurrent sentences will remain as fixed by the High Court.

[33]	Ms Wilson faced two charges, one of manufacturing methamphetamine over the period 16 May to 28 July 2004, and one of selling cannabis. The cannabis was the 28 ounces which she and Mr Te Rure on-sold to a family member.
[34]	Ms Wilson was sentenced to a term of ten years imprisonment with a minimum period of imprisonment of six years on the manufacturing charge. A concurrent term of two and a half years imprisonment was imposed on the sale of cannabis charge.
[35]	As we have noted, MacKenzie J sentenced Ms Wilson on the basis she was the "second in charge" of the operation. His Honour described her as directing others and having a knowledge of the scale and running of the enterprise.
[36]	MacKenzie J considered an increase in sentence of 18 months from the starting point of 11 years was appropriate to reflect two personal aggravating features, namely, the cannabis offending and previous convictions in 2005 for methamphetamine related offending for which Ms Wilson was sentenced to a term of five months imprisonment.
[37]	It now is apparent that this offending took place while Ms Wilson was on bail for the methamphetamine-related offending which resulted in her 2005 convictions. Those convictions in fact related to offending in 2003. The fact that this offending took place while Ms Wilson was on bail does not appear to have been drawn to MacKenzie J’s attention and is a further personal aggravating feature.
[38]	From a sentence of 121/2 years, a discount was given for the guilty plea, resulting in an end sentence of ten years imprisonment with a minimum period of imprisonment of six years.
[39]	Mr Snell’s submission on behalf of Ms Wilson was that the starting point of 11 years was too high given, first, this was category 2 offending in terms of Arthur and, second, bearing in mind the reality of Ms Wilson’s involvement. The Crown submits that the summary of facts makes it plain Ms Wilson’s role was a leading one and argues that the starting point reflects the seriousness of her offending.
[40]	As to the first point raised by Mr Snell, we have already said this offending was properly characterised as category 3 in Arthur terms, with an increase for manufacturing. The starting point was, however, at the highest end.
[41]	We have made it clear we do not intend to interfere with the sentencing Judge’s assessment of culpability and of relative culpabilities. Moreover, we reject Mr Snell’s submission that Ms Wilson, while the "second in command", in reality acted at the behest of Mr Te Rure. The summary of facts records a course of conduct by Ms Wilson consistent with an independence of action on her part. The summary of facts also demonstrates that she knew well the various processes involved and participated in them. She told the pre-sentence report writer that she was "in it" for the money. It follows from this that we do not accept the further submission that there should have been a greater difference between the sentence imposed on Ms Wilson and that imposed on Mr Te Rure.
[42]	Applying the reasoning we took in relation to Mr Te Rure, we do however accept the submission that the overall sentence, with a starting point at the highest end and with a strong response for the personal aggravating features, was manifestly excessive. The appropriate starting point was 11 years.
[43]	From that starting point, an appropriate end sentence is nine years imprisonment. Ms Wilson did plead early.
[44]	There is no challenge to the imposition of a minimum term reflecting two-thirds of the total sentence.
[45]	The appeal against sentence is allowed. The sentence of ten years imprisonment with a minimum period of imprisonment of six years on the manufacturing charge is set aside. We substitute a sentence of nine years imprisonment with a minimum period of imprisonment of five years. The concurrent sentence remains as fixed by the High Court.

[46]	Mr Otter was sentenced to a term of imprisonment of seven years with a minimum period of imprisonment of four years on one count of conspiracy to manufacture methamphetamine over the period 16 May to 28 July 2004. MacKenzie J described Mr Otter as having assisted the enterprise in a number of ways, visiting the address on numerous occasions and for lengthy periods. MacKenzie J said that in addition to transporting chemicals and equipment, Mr Otter also took part in the manufacturing process on a number of occasions. He too was seen as well aware of the circumstances and of the dangers to which the young children were being exposed. A starting point of nine years imprisonment was taken. The only mitigating feature was the guilty plea for which a reduction of two years was seen as appropriate.
[47]	A minimum term was imposed to reflect the extent of Mr Otter’s role and the fact that a previous term of imprisonment had not deterred Mr Otter from this type of offending.
[48]	Mr Quilliam sought to have the Court take a different view from that of MacKenzie J on the level of Mr Otter’s involvement. As we have indicated, we do not see any basis for doing that.
[49]	We do accept that the lesser nature of the charge faced by Mr Otter is a factor which has probably not received adequate attention. If this factor had been overlaid with MacKenzie J’s analysis, that would have led to a starting point of around seven years three months. MacKenzie J took into account Mr Otter’s previous serious drug-related offending in deciding to impose a minimum period of imprisonment. We believe that this factor should have been treated as a personal aggravating feature warranting an increase in sentence to eight years. With a reduction for the guilty plea of about the same proportion given by MacKenzie J, that leads to an end sentence of six years.
[50]	As we have explained, the Judge should have applied the test for the imposition of a minimum period as it was prior to the amendment of s 86. The Crown submission is that under either form of s 86, the test is met given the seriousness of the offending, its scale and the involvement of children.
[51]	The Judge imposed a minimum term on the basis of Mr Otter’s role in this offending and due to the fact that a previous term of imprisonment had not deterred Mr Otter from further offending in the same way. Applying R v Brown [2002] 3 NZLR 670 at [29], the factors identified by MacKenzie J are not circumstances of the offence which put this offending in the "sufficiently serious" category such as to warrant a minimum term. Nor do the matters emphasised by the Crown take this offending into that category. The test for the imposition of a minimum term which then applied was not met.
[52]	The appeal against sentence is allowed. The sentence of seven years with a minimum period of imprisonment of four years is set aside. We substitute a sentence of six years imprisonment with no minimum period of imprisonment.

[53]	Mr Scully was sentenced to a term of nine years imprisonment with a minimum period of imprisonment of five years on a charge of conspiracy to manufacture methamphetamine over the period from 16 May to 28 July 2004. Mr Scully faced two other charges of possession of precursor substances which related to him being found with those substances on 23 February 2005. On each of those two charges, he was sentenced to terms of two years all to be served concurrently.
[54]	Again, MacKenzie J described Mr Scully as being fully involved in the operation - assisting in the manufacturing process on a number of occasions, delivering finished product; purchasing and obtaining items to be used in the manufacturing process, transporting items to and from the address and undertaking a number of other tasks under the direction of Mr Te Rure.
[55]	Mr Scully’s level of involvement was seen as "broadly comparable" to that of Mr Otter. A starting point of nine years was accordingly adopted. However, unlike Mr Otter, there was an aggravating feature, namely, that while on bail for this offending Mr Scully had committed the offending involving the precursor substances. MacKenzie J also placed some emphasis on the fact that part of Mr Scully’s offending on these charges occurred after the arrest of Richard Te Rure and others on 28 July 2004. Accordingly, from the nine year starting point, MacKenzie J added two years to make a sentence of 11 years imprisonment. That was reduced for the guilty plea to a nine year end term. The level of Mr Scully’s involvement and the need for deterrence, given Mr Scully’s continued offending, was seen to warrant a minimum term of five years.
[56]	We have already dealt with the retrospectivity argument raised by Mr La Hood in relation to Mr Scully’s offending. Mr La Hood also sought to make something of the disparity in sentence between Mr Scully and Mr Otter. Again, we accept MacKenzie J’s assessment of relative culpabilities. We do, however, agree that the increase of two years from the starting point for the fact Mr Scully offended while on bail was too high. We do not consider that the fact Mr Scully continued to offend after the arrest of the others was an aggravating factor warranting an increase.
[57]	As with Mr Otter, a downward adjustment was necessary to reflect the lesser, conspiracy, charge. With these factors in mind, the appropriate starting point was seven years three months with an increase in sentence to eight years three months for personal aggravating features. There was no challenge to the reduction for the guilty plea. Using about the same percentage reduction as applied by MacKenzie J would lead to an end sentence of six years six months. For the same reasons applicable to Mr Otter, we accept Mr La Hood’s submission that the test for a minimum period of imprisonment which then applied was not met.
[58]	The appeal against sentence is allowed. The sentence of nine years imprisonment with a minimum period of imprisonment of five years on the conspiracy to manufacture methamphetamine charge is set aside. We substitute a sentence of six years six months imprisonment with no minimum period of imprisonment. All the concurrent sentences will remain as fixed by the High Court.

[59]	Mr Bryan was sentenced to a term of imprisonment of five years, nine months on one charge of conspiracy to manufacture methamphetamine over the period 16 May to 28 July 2004.
[60]	Mr Bryan’s role was the storage of goods, transportation of equipment, and he did take some part in manufacturing on one occasion.
[61]	MacKenzie J assessed Mr Bryan’s level of culpability as slightly lower than that of Mr Otter and Mr Scully. From a starting point of seven and a half years imprisonment the term was reduced to five years, nine months in recognition of his guilty plea.
[62]	The submission for Mr Bryan is that any higher starting point than six years with an end sentence of four years imprisonment is manifestly excessive for a secondary party. The starting point adopted does not reflect the extent of Mr Bryan’s involvement or his role relative to that of Mr Scully and Mr Otter. Mr Manning also submits that a comparison with other cases involving persons filling Mr Bryan’s role in this enterprise shows the sentence imposed is out of line.
[63]	For the reasons we have given we consider no issue can be taken with MacKenzie J’s assessment of culpability nor with that of relative levels of culpability as amongst the appellants. It is also necessary to keep in mind the nature of the enterprise in which Mr Bryan, like the others, was conspiring. This was serious offending.
[64]	As with the other appellants facing conspiracy charges, overlaying that aspect on MacKenzie J’s analysis, the starting point of seven and a half years adopted for Mr Bryan was too high. A starting point of six years was appropriate. There are no personal aggravating features. Adopting about the same percentage reduction for the guilty plea would lead to an end sentence of four and a half years imprisonment.
[65]	The appeal against sentence is allowed. The sentence of five years nine months is set aside. We substitute a sentence of four and a half years imprisonment.

[66]	Mr Olsen was sentenced to a term of imprisonment of five and a half years on one count of conspiracy to manufacture methamphetamine over the period 16 May to 28 July 2004. MacKenzie J described him as Mr Te Rure’s "lieutenant". He had responsibility for storage and transportation of chemicals and assisted on one occasion in manufacture. MacKenzie J saw Mr Olsen’s involvement as equating to that of Mr Bryan but "slightly lower". From a starting point of seven years imprisonment there was a reduction in the term in recognition of the guilty plea to a term of five and a half years imprisonment.
[67]	Mr Jefferson makes similar submissions about the need to recognise that Mr Olsen’s offending involved the lesser conspiracy charge. He, too, submits the assessment of level of culpability is not correct, suggesting rather that Mr Olsen’s involvement was a little below that of Mr Bryan. It is also submitted a greater discount for the guilty plea should have been given.
[68]	Applying the reasoning taken to the other appellants sentenced on the conspiracy charge, the starting point for Mr Olsen was excessive. The appropriate starting point is five and a half years imprisonment. There are no personal aggravating features. We are not satisfied there should be any greater discount for Mr Olsen’s guilty plea than applies to the other appellants although the reduction for Ms Wilson is slightly higher. With a reduction of about 21% for the guilty plea, the appropriate end sentence is four years three months imprisonment.
[69]	The appeal against sentence is allowed. The sentence of five and a half years is set aside. We substitute a sentence of four years three months imprisonment.