Heta v R [2012] NZCA 267 (22 June 2012)

Last Updated: 27 June 2012

IN THE COURT OF APPEAL OF NEW ZEALAND

CA126/2012 [2012] NZCA 267

BETWEEN MARGARET DOREEN HETA Appellant

AND THE QUEEN Respondent

Hearing: 15 May 2012

Court: Randerson, Keane and Asher JJ

Counsel: R Vigor-Brown for Appellant K A L Bicknell for Respondent

Judgment: 22 June 2012 at 11.30 a.m.

JUDGMENT OF THE COURT

The appeal is allowed. The sentence of 12 months imprisonment is quashed and a sentence of eight months imprisonment substituted.
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REASONS OF THE COURT

(Given by Keane J)

[1] The appellant Ms Heta appeals against a sentence of 12 months imprisonment imposed on 2 March 2012 for three offences of benefit fraud. She was tried before Judge Weir and a jury but pleaded guilty after an amended indictment was presented part way through her trial.
[2] As initially presented, the Crown case was that Ms Heta had lived with her partner Suresh Singh and their four children throughout a period of five years and had received welfare benefits totalling nearly $87,000 for all of that time. The original indictment contained eight counts to reflect that.
[3] The amended indictment much reduced the number and scope of the charges. It contained three counts. The first reduced the period over which benefits were wrongly claimed to five specific periods totalling 19 and a half months in all. The amount of the benefits obtained in those periods was reduced to $51,000. The other two counts alleged Ms Heta fraudulently completed work and income review forms on two occasions.
[4] The Judge said on sentence that Ms Heta never had a defence and the only issue was quantum. He held that Ms Heta’s plea had been “very belated”. She was not entitled to any credit for it. He considered she showed no remorse. Rather, she showed a continuing sense of entitlement. He said her ability to make good the loss she had caused to the state, was miniscule. She remained a beneficiary. He considered he had no choice but to imprison her.

Issues on appeal

[5] Ms Heta contends that the issue at trial was not merely one of quantum. It was one of culpability. In amending the indictment the Crown conceded that she was significantly less culpable than first alleged.
[6] Ms Heta contends that she was obliged to go to trial. During her trial she pleaded immediately when the Crown correctly expressed her culpability. The Judge materially overstated her lack of remorse and her continuing sense of entitlement. He overrated these factors, and her inability to pay adequate reparation because she remained a beneficiary. Conversely he underrated the effect of a sentence of imprisonment on her family, especially her younger children, and on her son by an earlier relationship, who now cares for them.
[7] Ms Heta submits she ought to have been sentenced to home detention, emphasising the Judge’s remarks when he remanded her for sentence and ordered a pre-sentence report containing a home detention appendix:

I do not know what your personal circumstances are, but bearing in mind the amended charges, I would have thought that it is highly unlikely that a sentence of imprisonment would be imposed.

Decision under appeal

[8] The Judge described the trial issue as whether Ms Heta had been living with Mr Singh while receiving the benefits over the five years in question. The Crown called 15 witnesses, including Mr Singh, as to the fact that she had. The Judge considered the Crown case had been “compelling”. Yet, Ms Heta had only entered her plea on the Crown’s amended indictment after she had given evidence herself. He then said this:

The conclusion that I have drawn from that is that you never had a defence to the overall charge under both the Social Security Act and the Crimes Act, it was simply a matter of quantum, that is the amount, and indeed that was the reason for the Crown reframing the indictments so that the amount in question reduced from approximately $87,000 down to $51,000.

[9] The Judge took as his benchmark for sentence the decision of the full court of the High Court in Hogan v Ministry of Social Development.[1] He considered that and other cases relied on by the Crown:

underscore the fact that there is no real set approach to sentencing in this area, but the two relevant issues are the amount taken and the period of time over which the offending occurred.

[10] The Judge accepted that in Ransom v R[2] this Court held that there is no prescriptive or usual sentence for welfare benefit fraud and that home detention can be a proper sentencing response. He also accepted that in Ransom the amount in issue was greater ($128,000), the period in question was longer (ten years), and that on appeal a sentence of home detention had been substituted for a period of imprisonment.
[11] Judge Weir noted that in Ransom, the appellant had longstanding difficulties with depression and anxiety. She had been remorseful. As a result of her imprisonment, her husband had been obliged to cease work to care for their six year old child and the substituted sentence enabled him to return to work. In the Judge’s view, the fact that Ms Heta had four children in her care did not place her in the same position.
[12] The Judge also distinguished Beedell v Ministry of Social Development,[3] where the benefit defrauded over two and a half years was $45,000 and, once again, home detention was substituted on appeal. There, the Judge said the appellant’s plea was prompt and her remorse was genuine. She had worked at two jobs to meet the over-payment.
[13] By contrast, the Judge considered Ms Heta’s plea was very belated. She had first appeared in the summary jurisdiction on 30 August 2010; she had obtained disclosure; she had gone to a status hearing; she had obtained further disclosure; and she had then changed her election to trial by jury. He held Ms Heta accountable for such delay as there had been.
[14] The Judge noted also that Ms Heta had been on a benefit of some form or another for 27 years. Since giving birth to her oldest child at the age of 19 years she had not worked. She lacked any remorse and she retained a strong sense of entitlement to the benefits she had received beyond her entitlement. As her pre-sentence report said, she minimised her offending and her motivation to address it was low.
[15] While Ms Heta had told the Judge on sentence that she was remorseful and had only offended for the sake of her children, the Judge said she had then “railed” against Mr Singh for the predicament in which he had placed her. At a three day hearing before the Human Rights Tribunal she had taken the Ministry of Social Development to task as to the way in which it had investigated her case.
[16] The Judge also remarked that, again in contrast to the Beedell case, at date of the hearing Ms Heta was in receipt of sickness and working for families benefits, totalling $650 a week from which the Ministry was deducting $20 a week to meet her liability. At that rate, he said, it would take her 50 years to make good the loss she had caused to the state. The Judge considered her offer made on the day of sentencing to pay $50 per week was very belated.
[17] Finally, the Judge questioned whether Ms Heta was the sole caregiver of her children. Apart from her five children, she had two grandchildren with whom she was in regular contact. Clearly, he said, there was extended whanau in the community. He also said that Ms Heta’s health stood in the way of a sentence of community work. She had a leg injury for which she needed a further operation. At most she was capable of light work.
[18] The Judge said the Crown was “comparatively neutral” about a sentence of home detention. He also acknowledged that in October 2011 he had “indicated that a sentence of home detention could well be considered”. However he took the view that the material set out in Ms Heta’s pre-sentence report, especially, her continuing sense of entitlement, stood in the way of a sentence of home detention.
[19] The Judge concluded that imprisonment was the only sentence able to be imposed. He took a starting point of 15 months, which he reduced to 12 months to take account of Ms Heta’s lack of previous convictions. He was not prepared to give her any discount for her plea.

Approach on appeal

[20] As this Court has emphasised, s 15A of the Sentencing Act 2002 requires a two-stage analysis: first to decide the sentence which is otherwise appropriate is a short-term sentence of imprisonment; and second, to decide whether to commute that sentence to home detention.[4]
[21] We wish also to emphasise that whether a short-term sentence of imprisonment is imposed, or home detention, calls for a specific analysis.[5] The sentence of home detention has not rendered a short-term sentence of imprisonment redundant; it remains a distinct sentencing option.[6] Where the scales are finely balanced, this Court will normally defer to the sentencing Judge.[7] It is not for this Court to revisit the merits of a decision to decline home detention in the absence of a material discretionary error.[8]

Quantum versus culpability

[22] We are satisfied that the Judge made a material error of law in assessing Ms Heta’s culpability when he held that the only effect of the Crown’s amended indictment to which she pleaded, was to reduce the quantum of her offending and not its intrinsic seriousness.
[23] As already noted, the original indictment alleged that between 23 February 2005–26 January 2010 she had been living with Mr Singh and had received nearly $87,000 in benefits to which she was not entitled.
[24] By contrast, count one of the amended indictment presented during trial alleged that within that five year span Ms Heta and Mr Singh lived together for three months, between 23 January–30 April 2005; for six months between 1 November 2005–30 May 2006; for three months between 1 June–30 September 2007; for three months between 1 June–30 September 2008 and, finally, for four and a half months between 9 May–30 September 2009. In all, this was no more than 19 and a half months.
[25] As the Judge recognised, one effect of that amendment was that the benefits Ms Heta was alleged to have received beyond her entitlement reduced from approximately $87,000 to $51,000. However he did not recognise that this was because the Crown no longer alleged that Ms Heta had offended for the full five years. The Crown accepted it could not establish that she had offended during at least three of those five years. Nor did the Judge identify that this was the reason why the counts alleging that false returns were made were reduced from five to two.
[26] In short, in holding that all that had changed with the amendment was the quantum the offending involved, and in giving no recognition to the reduced time span of the offending, the Judge did not accurately identify Ms Heta’s culpability. He did not recognise, as the full Court of the High Court said in Hogan, that:

The number of deliberate acts of fraud is relevant when determining the seriousness of an offence, as is the fact that every time the fraudulently obtained benefit is paid, the offender knows that it has been received dishonestly and fraud in essence occurs on each occasion.[9]

Belated plea

[27] The failure to recognise the true effect of the reduced indictment on Ms Heta’s culpability led the Judge to assume she had gone to trial setting out to defend the indefensible, and that she only pleaded once the evidence against her proved to be compelling, even to her eyes. He relied on this conclusion when finding she lacked remorse and had a continuing strong sense of entitlement.
[28] In fact, and we do not know whether this was made plain to the Judge, Ms Heta had not been completely obdurate before the trial. After she was charged summarily in August 2010 and before she was committed to trial in March 2011 she made a material admission. On 26 January 2011, when interviewed by the Ministry, she admitted in a general way to the offending which eventually she admitted formally. She said “what I am owning up to is, yes, we have a on again, off again relationship” and she continued to say “and that's been that way for a long time”.
[29] In retrospect Ms Heta ought then to have been more specific. It would have been preferable for her then counsel (not present counsel) to have written to the police and the Crown Solicitor, with a copy to the Court, stating that she was prepared to plead to offending on the scale she admitted.[10] Unquestionably, she would then have been entitled to the full benefit of that concession when she pleaded to the amended indictment.[11] Perhaps the trial might have been avoided altogether. Why that did not happen we are unable to say. Nor can we say whether any attempt was made to question Mr Singh more closely in the light of Ms Heta’s admission of an intermittent relationship.
[30] What we can say is that Mr Singh gave evidence in chief for the Crown according to a very abstract brief, stating that he and Ms Heta had lived together continuously in a relationship for the full five year span. However he immediately resiled from that when cross-examined as to the actual periods they lived together.
[31] It appears that Ms Heta then gave evidence confirming what Mr Singh had said. The Crown subsequently filed its amended indictment and Ms Heta immediately said she was prepared to plead to it. In the less than ideal way in which this came about, she could be said to have pleaded at the first reasonable opportunity.

Remaining discretionary factors

[32] We also consider the Judge erred in relation to other discretionary factors. First, we consider the Judge placed undue weight on Ms Heta’s lack of remorse and sense of entitlement. She certainly considered herself entitled to continue to claim the three benefits during the 19 and a half months that Mr Singh intermittently lived with her. But that was because she had four children to care for and she could not rely on him. As she said in her pre-sentence report, “I had to hang on to my benefit as he couldn't financially support me.” This could not excuse her offending but helps to explain why she did so.
[33] Ms Heta explained in the pre-sentence report that Mr Singh only lived with her when he had no job, that he was not a legal resident of New Zealand, that he was not eligible for a benefit and that at one point he was deported to Fiji as a result of which they were apart for five years. She said that she had always been the sole source of support for her children. Mr Singh himself conceded when cross-examined that when he did live with Ms Heta and the children, he spent Friday night and all Saturday at a local tavern. He “lived” there. He also admitted to other reasons Ms Heta had to be disaffected with him. Any support she could have anticipated from him was clearly more notional than real.
[34] Secondly, reparation was not in issue on sentence. The Ministry did not ask for it and was deducting $20 a week from Ms Heta’s benefits. While she was receiving benefits totalling $652 a week, her outgoings came to $655 a week. This does not appear unreasonable. Her $50 offer on the day of sentence was only possible because her 17 year old daughter had begun to work.
[35] Thirdly, we do not consider the Judge sufficiently took into account the effect that imprisoning Ms Heta would have on her family, especially her two younger children, aged 10 and five years. He was also incorrect to assume she could rely on extended whanau. We were told that the children are now being cared for by her son by an earlier relationship, who has children of his own. We were also told that he has given up a lucrative job at real cost in order to care for Ms Heta’s other children.
[36] None of these three factors, set against the reduced scale of Ms Heta’s offending, justified a term of imprisonment. In the round, they are not dissimilar to those that led this Court in Ransom to substitute on appeal a sentence of home detention.

Conclusions

[37] In deciding what term of imprisonment was proper for Ms Heta's offences, but for a sentence of home detention, the Judge was fully entitled to take a starting point of 15 months.
[38] We also accept the Judge was right to allow Ms Heta a three month discount for her lack of previous convictions. But she was entitled to two further discounts. The Judge should have recognised the difficulty a sentence of imprisonment would cause Ms Heta's two young children, justifying a discount of at least another month. The Judge should also have allowed Ms Heta a 25 per cent discount for her plea, almost another three months.
[39] Ms Heta's sentence ought not to have exceeded eight months imprisonment. Furthermore, though home detention can never be the presumptive sentence in cases of this kind, that is the sentence that ought to have been imposed on Ms Heta having regard to like cases and the true extent of her culpability.
[40] Unfortunately, we have been advised that Ms Heta’s address is no longer available for home detention purposes. Attempts by her to obtain an alternative address have been unsuccessful despite the Court allowing her nearly three weeks to explore alternatives.
[41] Given our view that a proper sentence would otherwise be eight months imprisonment, her release date would be in early July 2012. Although her counsel advised yesterday that another address may be available, the suitability of this address would still need to be confirmed. In the circumstances, and given the lapse of time, we now consider it would be unjust to impose an additional period of home detention beyond her release date if an eight month sentence were imposed.
[42] We allow the appeal and quash the sentence of 12 months imprisonment. A sentence of eight months imprisonment is substituted.

Solicitors:
Moana Law, Rotorua for Appellant
Crown Law Office, Wellington for Respondent

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[1] Hogan v Ministry of Social Development (2005) 23 CRNZ 500.
[2] Ransom v R [2010] NZCA 390, (2010) 25 CRNZ 163.

[3] Beedell v Ministry of Social Development HC Wanganui CRI 2010-483-9, 11 February 2010.

[4] R v Vhavha [2009] NZCA 588 at [31]; R v Ondra [2009] NZCA 489; Osman v R [2010] NZCA 199; Manikpersadh v R [2011] NZCA 452.
[5] Ransom, above n 2, at [39].
[6] Polyanszky v R [2011] NZCA 4 at [13].
[7] R v D (CA 253/2008) [2008] NZCA 254 at [66].
[8] James v R [2010] NZCA 206, (2010) 24 NZTC 24,271 at [17].
[9] Hogan v Ministry of Development (2005) 23 CRNZ 500 at [40].
[10] As this Court said in R v Hessell [2009] NZCA 450, [2010] 2 NZLR 298.
[11] Hessell, above n 10, at [44].