Motor Vehicle Dealers Institute v Sykes [2018] NZDC 16437 (7 August 2018)

Last Updated: 23 August 2019

IN THE DISTRICT COURT AT HAMILTON

CRI-2018-019-002798

[2018] NZDC 16437

MOTOR VEHICLE DEALERS INSTITUTE

Prosecutor v

JESSICA BONNIE GAY SYKES Defendant

Hearing:	7 August 2018
Appearances:	K Whyte for the Prosecutor No appearance by or for the Defendant
Judgment:	7 August 2018

NOTES OF JUDGE P G MABEY QC ON SENTENCING

[1] This is a sentencing decision in the matter of the Registrar of Motor Vehicles as prosecutor and Jessica Bonny Gay Sykes as defendant. Mr Whyte is for the prosecutor, no appearance for the defendant.

[2] The defendant, Jessica Sykes, is prosecuted under s 95(1)(a) Motor Vehicle Sales Act 2003. The allegation is that between the period 8 October 2016 and 7 October 2017 she carried on the business of motor vehicle trading without being registered under the Act. Section 95 prohibits that activity and the maximum penalty is a fine of $50,000.

[3] Ms Sykes was served with the charging document and made an appearance on 30 May 2018 when she was assisted by the duty solicitor. She was then remanded at large to 13 June, apparently to apply for legal aid. On 30 June 2018 Ms Sykes did not

MOTOR VEHICLE DEALERS INSTITUTE v JESSICA BONNIE GAY SYKES [2018] NZDC 16437 [7 August 2018]

appear and the Magistrate adjourned this matter for a formal proof hearing. That took place before Judge O’Driscoll on 20 June when a conviction was entered.

[4] Subsequent to that the Court posted a notice to Ms Sykes advising of the conviction and that sentencing would take place today, 7 August 2018 at 11.45 am in District Courtroom 4. The notice was sent to her address, being the same address as appears on the charging document.

[5] Although not requested by the Judge, Mr Whyte sent a notice to the same address advising Ms Sykes of the conviction, the date and place of sentencing and her right to apply for a re-trial or a re-hearing. His notice was issued pursuant to s 124 Criminal Procedure Act 2011. I am satisfied that Ms Sykes is aware of today’s events and that she has the right to be here and make submissions. She makes no appearance and I will proceed to sentence in her absence.

[6] Section 8(1) of the Act provides that a person is treated as a motor vehicle trader if that person holds him or herself out as carrying on the business of motor vehicle trading or in any specified period, being 12 months, the person sells more than six motor vehicles unless that person proves that those motor vehicles were not sold for the primary purpose of gain. It is the latter of those provisions which is relied upon in this case. At formal proof, the Judge found that 11 vehicles were sold by Ms Sykes during the relevant 12-month period and no issue was raised to discharge the reverse burden to establish that the vehicles were not sold for the primary purpose of gain.

[7] An additional feature of this case is that Ms Sykes was written to by the registrar on 6 September 2017 regarding her activity and the need to comply with the Act. On 5 October 2017, the Ministry of Business Innovation and Employment wrote a further letter advising of her non-compliance with the Act. No response was received to either letter, but a further car was sold after those letters had been received. Mr Whyte says that is an aggravating factor.

[8] The Motor Vehicle Sales Act 2003 is consumer protection legislation. It is designed to protect the public who purchase motor vehicles. When the Act came into force it was not anticipated that there would be a proliferation of people who engage

in the sale of motor vehicles for profit without being registered. That was in a time when Internet activity was much less than it is now.

[9] However, in present circumstances, Internet access is readily available through Trade Me, Facebook and other platforms for vehicles to be advertised and sold. The Act imposes obligations upon people who sell motor vehicles. Those that are registered must comply with requirements designed entirely for the protection of the public. They include the need to have a prominent notice attached to any vehicle for sale advising the prospective buyer of their rights under the Personal Property Securities Act 1999 and also consumer information in accordance with the Fair Trading Act 1986.

[10] In addition, the dealer must keep a record of all contracts for sale and must on demand of the registrar or other authorised person produce the certificate of registration.

[11] However, a person who is trading unregistered is not subject to any such restraint and members of the public can fall victim to dishonest and underhand activities without any proper knowledge of their consumer rights. That is the purpose of the Act and that is why unregistered motor vehicle trading is proscribed by the law and if proven attracts a significant monetary penalty.

[12] For sentencing purposes, the primary principles must be denunciation and deterrence. In Commerce Commission v LD Nathan & Co Ltd, a High Court decision of Greig J from 1990, the Judge listed certain factors appropriate to the consideration of a penalty for offending under the Fair Trading Act 1986.1 That case still has currency and is often referred to in Commerce Commission prosecutions. The principles apply here.

[13] The Judge said the sentencing Court must have regard to the objectives of the Act under which the prosecution is brought, the degree of wilfulness or carelessness involved and the need to impose a deterrent penalty.

1 Commerce Commission v LD Nathan & Co Ltd [1990] 2 NZLR 160 (HC).

[14] The object of the Motor Vehicle Sales Act is to ensure appropriate and accessible consumer protection through the provision of accurate information for consumers’ purchase decisions, creditable and accessible redress and effective enforcement. Unregistered trading undermines that purpose.

[15] In this case I consider there to be a significant degree of wilfulness evidenced by Ms Sykes’ failure to take heed of notices given to her concerning her non-registration and breach of the law. It could not possibly be said that she was not aware of her obligations.

[16] There have been a number of prosecutions in recent times which have attracted fines and which are relevant today to sentence on a consistent basis. His Honour Judge McDonald, in Registrar of Motor Vehicles v Tamai, sentenced for the sale of 13 vehicles within a 12-month period.2 He adopted a start point of $8000.

[17] His Honour Judge Collins in Registrar of Motor Vehicles v Buchanan sentenced for the sale of 10 motor vehicles within a 12-month period.3 In that case, Mr Buchanan did not answer a summons or appear and the charge was proved on a formal proof. He adopted a start point of $8000.

[18] His Honour Judge Down in Registrar of Motor Vehicles v Herewini sentenced for the sale of 11 motor vehicles during a 12-month period.4 In that case Mr Herewini took no part in the hearing and the charge was proved on formal proof. He did not appear at sentence. The Judge adopted a start point of $9000 and took into account the fact that Mr Herewini also received letters and emails, on a number of occasions, advising that he was in breach of the law and pointing out the need to register.

[19] Her Honour Judge McAuslan in Ministry of Transport v Hama sentenced for the sale of 13 motor vehicles during a 12-month period.5 The defendant in that case had also received numerous emails and letters informing of the provisions of the Act and the need to comply with them. A start point of $9000 was adopted.

2 Registrar of Motor Vehicles v Tamai [2014] DCR 291.

3 Registrar of Motor Vehicles v Buchanan [2014] DCR 287.

4 Registrar of Motor Vehicles v Herewini [2016] NZDC 4065.

5 Ministry of Transport v Hama DC Papakura CRI-2014-055-001542, 25 August 2014.

[20] Mr Whyte contends for a start point of $8500 to $9000 and refers to a number of the cases that I have quoted above. I adopt a start point of $8500. There are no aggravating factors personal to Ms Sykes that would increase that point, nor are there any mitigating factors and for that reason the fine is $8500, Court costs $130 and solicitor’s fees of $500.

P G Mabey QC District Court Judge