Wilkins v Housing New Zealand Corporation [2014] NZHC 2095 (1 September 2014)

Last Updated: 10 September 2014

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CRI-2014-404-000112 [2014] NZHC 2095

BETWEEN	ALLAN KENITH WILKINS Appellant
AND	HOUSING NEW ZEALAND CORPORATION Respondent

Hearing:	26 August 2014
Appearances:	Appellant in person F Cuncannon / K Muirhead for Respondent
Judgment:	1 September 2014

_{JUDGMENT OF COURTNEY J}

This judgment was delivered by Justice Courtney on 1 September 2014 at 4.45 pm

pursuant to R 11.5 of the High Court Rules

Registrar / Deputy Registrar

_{Date..........................}

WILKINS v HOUSING NEW ZEALAND CORPORATION [2014] NZHC 2095 [1 September 2014]

Introduction

[1] Allan Wilkins pleaded guilty in 2009 to one representative charge of using a document to defraud Housing New Zealand (HNZ). He was represented by counsel at the time and had an opportunity to vacate the plea before he was sentenced, which he did not take. He completed the sentence of five months’ home detention and 100 hours community work.¹ Now Mr Wilkins has applied for leave to appeal his conviction and to adduce further evidence in support of the appeal.

[2] The charge to which Mr Wilkins pleaded guilty arose from his occupation of HNZ properties at income related, rather than market, rent between March 2004 and February 2007. In obtaining accommodation at the very favourable income related rent Mr Wilkins failed to disclose his ownership of the shares in a privately owned companies. HNZ did not seek a reparation order but in 2010 it brought civil proceedings against Mr Wilkins to recover the difference between the income-related

and market rents.²

[3] Mr Wilkins defended the civil claim on the ground that HNZ had agreed, when he entered his guilty plea, that it would not seek to recover the debt from him. Judge Sinclair rejected that assertion and entered judgment against Mr Wilkins for

$68,410 (plus interest).³ Mr Wilkins did not appeal that decision. However, when

HNZ began bankruptcy proceedings against him he applied for judicial review of HNZ’s decisions to prosecute him and bring the civil proceedings. The judicial review proceedings were struck out in March 2014.⁴ The bankruptcy proceedings, which were adjourned pending determination of the judicial review proceedings, have been adjourned again pending the outcome of the current applications.

[4] The grounds for the applications for leave to appeal and adduce further evidence are that:

¹ Housing New Zealand Corporation v Wilkins Auckland DC CIV-2010-004-001904, 19

_{December 2012.}

² _{Housing Restructuring and Tenancy Matters Act 1992, s 60.}

³ _{Wilkins v Housing New Zealand Corporation [2014] NZHC 507.}

⁴ Housing New Zealand Corporation v Wilkins Auckland DC CRI-2007-004-14842, 22 December

2009.

(a) Mr Wilkins pleaded guilty in the mistaken belief that if he did so HNZ would neither seek a reparation order nor bring civil proceedings against him for the difference between the income related and the market rents;

(b) When HNZ undertook the needs assessment interviews at which Mr Wilkins should have disclosed his interest in the companies the interviewer failed to ask the relevant questions, with the result that Mr Wilkins had no dishonest intention;

(c) The decision to prosecute was based on inaccurate information about

Mr Wilkins’ income and assets.

[5] HNZ opposes the applications on the ground that circumstances do not exist that would justify leave being granted, given that Mr Wilkins was represented at the relevant time and has not explained the delay in making the application.

[6] It is only in exceptional circumstances that leave to appeal against conviction will be granted where the conviction followed a guilty plea, as the Court of Appeal explained in R v Le Page:⁵

[16] ... it is only in exceptional circumstances that an appeal against conviction will be entertained following entry of a guilty plea. An appellant must show that a miscarriage of justice will result if his conviction is not overturned. Where the appellant fully appreciated the merits of his position and made an informed decision to plead guilty, the conviction cannot be impugned ...

[17] A miscarriage will be indicated in at least three broad situations ... The first is where the appellant did not appreciate the nature of or did not intend to plead guilty to a particular charge. These are situations where the plea is shown to be vitiated by genuine misunderstanding or mistake. Where an accused is represented by counsel at the time a plea is entered, it may be difficult indeed to establish a vitiating element.

[7] I indicate that the third ground cannot succeed. The investigation and decision to prosecute were internal processes that were overtaken by the criminal

_{prosecution. They are issues that, if they had merit, could have been raised as a}

⁵ R v Le Page [2005] NZCA 67; [2005] 2 NZLR 845 at [16] – [17].

defence in the criminal proceedings. Mr Wilkins had the assistance of both counsel and an accountant at the time and there was adequate opportunity for him to address the matters then. Further, these issues have already been the subject of Andrews J’s decision striking out the judicial review proceedings.

The offending

[8] Mr Wilkins incorporated a company called Make It Limited in October 2003. He was the sole director and shareholder. By 2004 Make It Limited owned two residential rental properties. Mr Wilkins undertook a needs assessment interview with HNZ in March 2004 and March 2005. In addition, he completed applications for income-related rent in March and November 2005. He did not disclose his interest in Make It Limited. He was granted occupation of HNZ properties in City Road, Auckland, and later in Te Arawa Street, Orakei, between July 2004 and July

2009 at a low income-related rent.

[9] In November 2005 Mr Wilkins incorporated another company, Thought Box Limited. At about this time HNZ became aware of Make It Limited. Mr Wilkins supplied business accounts showing losses from the two rental properties. But he did not mention Thought Box Limited either then, nor in application forms completed in July 2006 and February 2007.

[10] HNZ referred the matter to its investigations unit in late 2005 but because of a backlog, no investigation was undertaken until early 2008. It was then that HNZ learned about Thought Box Limited.

The first ground: the circumstances of the guilty plea

The criminal proceedings

[11] Mr Wilkins was initially represented by Mr Martell and subsequently by Dr Coughlan. Initially there were six charges based on the six statements made by Mr Wilkins in relation to his applications for rental property. Within a relatively

short time it was proposed (it is unclear by whom) that the six charges be reduced to a single representative charge to which Mr Wilkins would plead guilty.

[12] There was, throughout the investigation and criminal proceeding, dispute over the extent to which Mr Wilkins had income from his companies and the value of his interest in the companies. This was one reason that HNZ agreed not to seek a reparation order. However, Mr Wilkins asserts that it also agreed not to bring civil proceedings.

[13] The evidence on this issue came from the exhibits and transcript from the civil trial, which Mr Wilkins relied on without objection from HNZ. These included transcripts from the status hearing in the criminal proceedings. This material satisfies me that, not only did HNZ specifically reserve its position regarding civil proceedings, but Mr Wilkins was aware of that fact and was not under any misapprehension as to the basis on which he had pleaded.

[14] Mr Wilkins entered his guilty plea on 30 June 2009. On 7 October 2009 there was a status hearing before Judge Perkins. The solicitor who was acting for HNZ was Mr Dufty but he was unavailable that day and Ms Paterson appeared instead. She gave evidence in the civil trial, which was accepted, that she did tell Mr Wilkins or his counsel that civil proceedings would not be brought. Her account is consistent with the transcript of that hearing, which records Dr Coughlan addressing the Judge on the extent to which Mr Wilkins should be paying the difference between his income-related rental and market rental and concluding that:

So that matter is going to be determined in another jurisdiction I should think, Your Honour, I’d like to be able to at least present mitigations so Your Honour could put the matter into the framework and so on ...

[15] Later in that hearing there was the following exchange between the Judge and Ms Paterson recorded in the transcript regarding the relevance of quantifying the benefit Mr Wilkins obtained.

Ms Paterson: It was a fairly significant benefit the defendant was paid.

It’s for that reason Your Honour that the informant is seeking

a pre-sentence report with appendices and the opportunity to make written submissions on sentence because it’s clearly a very significant benefit that this defendant has received.

The Court: It’s going to be the subject of further civil action?

Ms Paterson: Yes that’s correct Your Honour that the informant isn’t seeking reparation through the criminal court but nevertheless that amount is clearly relevant to the extent of the advantage and ended up in criminal charges.

...

The Court: I’m not going to make any reparation if there’s a civil

remedy, is he being sued? Ms Paterson: Reparation is not.

The Court: Is he being sued?

Ms Paterson: I’m not sure Sir, I understand that it may be in due course, all my instructions are is that reparation is not sought.

[16] On 7 October 2009 there was a hearing before Judge McNaughton, which was adjourned so that Mr Wilkins could consider whether he wished to vacate his guilty plea. The transcript of that hearing is not before me but was described by Mr Dufty, the solicitor who appeared for HNZ at that hearing and gave evidence in the civil proceeding:

Yes, I appeared at sentencing that day, the presiding Judge was Judge McNaughton, Mr Patena from Housing New Zealand was also present in court. When I appeared before His Honour he mentioned that, in open court, that there were, he had three concerns with the file. The first of those concerns was that when Mr Wilkins had spoken to the probation officer he’d effectively denied any wrongdoing. The second concern that the Judge had was that we were effectively wrapping up seven or eight instances of offending into one representative count and the Judge mentioned that he wasn’t sure that we could do that and the third concern he had was that he said ‘I understand the informant is not seeking criminal reparation’ but, he said to Mr Wilkins ‘that doesn’t prevent you from offering some reparation’. He mentioned that his view of the case was that a probable sentence would be a custodial one and if Mr Wilkins offered some reparation that would tilt the balance so he may have received a sentence of electronic monitoring or community-based sentence so he said ‘I’m going to adjourn this’. He said

‘I’m not sure whether Mr Wilkins wants to vacate his plea’.

[17] Mr Dufty went on to describe a discussion that occurred immediately after that hearing between himself, Mr Patena, Mr Coughlan and Mr Wilkins:

It was at that time that Mr Wilkins said he would make an offer to resolve the proceedings and he said he would pay, I believe $15,000 in compensation if Housing New Zealand dropped the charges and at this point myself and Mr Coughlan were, I suppose, merely acting as conduits for Mr Patena and Mr Wilkins who were doing most of the talking and Mr Patena

made it clear that he said to Mr Wilkins ‘No we won’t be doing that, we can’t do that, we’re not going to drop the charges’ and he said to Mr Wilkins

‘Equally, we’re looking into civil proceedings against you’. At one point Mr

Wilkins was remonstrating with Mr Patena. He said ‘No, well, I’ll pay you this money, you drop the charges’ and I recall distinctly Mr Patena turning to

him and saying ‘We won’t be doing anything of the sort, we want you to

plead guilty to the charges and we want to – Housing wants to claim the

money back off you’.

[18] I note here that Mr Wilkins does not accept that he was party to that conversation. Dr Coughlan was cross-examined on the conversation and said that:

That may be correct but I really can’t – can’t remember in that particularity.

[19] In any event, when the matter was called before Judge Kiernan on 14 October

2009 Mr Wilkins confirmed his guilty plea. He appeared for sentencing before Judge Wilson QC on 22 December 2009, who said to him at the outset of the sentencing:

No reparation is sought because the informant will be seeking that from you civilly.

[20] In the face of this evidence it is not realistic for Mr Wilkins to now suggest that he believed that HNZ had agreed not to bring civil proceedings.

The civil proceedings

[21] HNZ commenced its civil proceedings in 2010. Mr Wilkins was represented by Mr Gilchrist. He did not apply then for leave to appeal his conviction.

[22] The civil proceedings were heard over the course of a year beginning in September 2011. The evidence of Ms Paterson was heard on 20 September 2011 and the case adjourned, part-heard, until 15 October 2012. The delay was due in part to Mr Wilkins’ difficulties in maintaining his legal representation. Early in 2012, with changes to the legal aid scheme, Mr Gilchrist ceased acting. Mr Wilkins was refused legal aid and elected to defend the case unrepresented.

[23] The matter took a further five hearing days in October 2012. There were submissions filed subsequently and a reserved decision delivered on 19 December

2012. Judge Sinclair said of Mr Wilkins’ claim that HNZ had agreed not to issue

civil proceedings:

I found Mr Wilkins’ explanation of events lacked credibility and in all respects I prefer the evidence of Ms Paterson, Mr Dufty, Mr Patena and Mr Coughlan which was entirely consistent with the status hearing transcript and with subsequent events. I am satisfied on the evidence that no agreement was reached between HNZ and Mr Wilkins not to issue civil proceedings. Furthermore, I am of the view that Mr Wilkins could not have been left in any doubt from what was said during the course of both the status and sentence hearings and also at the meetings of HNZ counsel, that HNZ intended to issue civil proceedings.

[24] Mr Wilkins did not appeal this judgment. The findings of Judge Sinclair are conclusive as between him and HNZ. Moreover, there is absolutely no basis on which to conclude that Judge was wrong in her finding.

The second ground: HNZ failed to ask the right questions and wrongly calculated the amount owing

[25] Mr Wilkins asserted that when he applied for HNZ accommodation at income-related rent the HNZ staff did not ask about his interest in private companies, that the quantum of HNZs claim is incorrectly calculated and based on false information and he lacked the requisite intent.

[26] There are a number of difficulties with raising these issues now. They are matters that Mr Wilkins could have raised at the time of the criminal proceedings. But since he acknowledges that he pleaded guilty to the charge for practical reasons, and obtained the benefit of a discount for that plea there is no basis on which to think that a miscarriage of justice will arise if he is not permitted leave to appeal so that he can now raise these arguments. Insofar as he maintains that the quantum of HNZ’s claim is wrong, that was a matter for the civil proceedings.

[27] Judge Sinclair did consider these arguments and rejected them:

[44] I am satisfied for the reasons set out above that the questions asked by the needs assessors when completing the NAI forms were appropriately worded to elicit the necessary information. Even if that had not been my view the issue in this case is the sufficiency of the financial information provided by Mr Wilkins to HNZ. The manner in which the NAI forms were completed and the way in which the questions were asked by the assessors is not relevant. Similarly, it is not relevant whether any failure by Mr Wilkins

to provide information when completing either of the NAI forms (or the IRR

applications) was deliberate and mistaken.

...

[50] I am satisfied on the evidence of Ms Corr that the market rents fixed by HNZ are in line with market rates and were appropriate for each property at the various times the IRRs were assessed.

[28] Judge Sinclair also held that Mr Wilkins had never provided accurate information about his income and assets and that:

[73] In all the circumstances I find that in the absence of true and complete financial information from Mr Wilkins, HNZ properly calculated the IRR on the basis of HNZ market rent for the City Road and Orakei properties in the periods claimed.

[29] As with the previous ground, Mr Wilkins cannot now seek to attack that finding by way of an attempt to appeal the original conviction.

No satisfactory explanation for delay

[30] Mr Wilkins has not provided a satisfactory explanation for the delay in bringing his application. The civil proceedings were commenced in 2010. If he had genuinely believed that HNZ had promised not to do so, that was the time for applying. He was represented by experienced counsel and not too much time had passed. Now, however, Dr Coughlan is deceased. The only evidence of Dr Coughlan’s knowledge is what he said in the civil proceedings, which does not assist Mr Wilkins.

[31] During oral argument I questioned Mr Wilkins about the delay in bringing this application. He suggested that it was connected with his search for further evidence that would show that the amount being claimed by HNZ was incorrect. Mr Wilkins was very focused on accounting issues and on demonstrating that HNZ had misunderstood the extent of his income from Make It Limited and Thought Box Limited. However, those issues are unconnected with the question of whether Mr Wilkins genuinely believed that HNZ had agreed not to take civil proceedings against him.

[32] Mr Wilkins also referred to legal advice he had obtained regarding the judicial review proceedings and it is true that in the judicial review proceedings he sought to advance the argument that HNZ had agreed not to bring civil proceedings against him and sought, by way of relief, to have the criminal conviction overturned. However, the judicial review proceedings were commenced in early 2014. There is no sensible explanation given for not taking any step following the sentencing in late

2009 or the commencement of the civil proceedings in 2010.

A possible miscarriage of justice?

[33] Mr Wilkins was in Court on three occasions when the possibility of civil proceedings was referred to. He was given the opportunity by Judge McNaughton to vacate the guilty plea and did not do so. He did not appeal his conviction at the time. At the sentencing hearing there was specific reference to the prospect of civil proceedings against Mr Wilkins, yet no action was taken then to appeal the conviction. Even when the civil proceedings were brought Mr Wilkins still did not apply for leave to appeal the conviction. Mr Wilkins was represented at all these stages by experienced counsel.

[34] Mr Wilkins’ assertions have been considered in the civil proceedings and rejected. His efforts to re-litigate them in the judicial review proceedings and in this application are collateral attacks on the District Court decision, which he did not appeal, and therefore an abuse of process.

[35] I make one further observation. Although Mr Wilkins claims that one of the reasons he is seeking leave to appeal is that he does not want a conviction recorded against his name, it is perfectly clear from his evidence in the civil proceeding that his decision to enter a guilty plea was a purely practical one. Had he been genuinely convinced of his innocence and concerned about his reputation it is unlikely that he would have entered the plea at the time or would have taken the opportunity offered by Judge McNaughton to vacate the plea. It is evident that Mr Wilkins’ primary motivation in bringing this application is to launch a collateral attack on the District Court judgment. Mr Wilkins seemed not to appreciate that even if he obtained leave to appeal the conviction, the judgment would be unaffected; although relevant to

HNZ’s case in the District Court, the conviction was not an essential part of that

case.

[36] In these circumstances I am satisfied both that Mr Wilkins fully understood the basis on which the guilty plea was entered and that there would be no miscarriage of justice in refusing leave.

Application for leave to adduce further evidence

[37] At the hearing I made a decision refusing leave to adduce the evidence of all but two of the witnesses who were the subject of the application. I reserved my decision in relation to the evidence of Ms Brock and Ms Lausten. As a result of my decision to refuse leave to appeal I refuse the application in relation to those witnesses also.

Result

[38] The applications are dismissed.

[39] HNZ may address the issue of costs by memorandum. Mr Wilkins may respond within seven days and HNZ may reply within a further seven days.

P Courtney J