Proctor v Police [2016] NZHC 2656 (7 November 2016)

Last Updated: 7 November 2016

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CRI-2016-485-65 [2016] NZHC 2656

REBEKAH LAURA PROCTOR

v

_{NEW ZEALAND POLICE}

Hearing:	27 October 2016
Appearances:	E Hall for appellant S C Carter and L C Hann for respondent
Judgment:	7 November 2016

JUDGMENT OF CULL J (Appeal against sentence)

[1] The appellant appeals her sentence of two years five months’ imprisonment for one representative charge of dishonestly using a document for pecuniary advantage between 1 January 2013 and 31 December 2015, to which she pleaded guilty.¹

The facts

[2] The offending occurred in the context of the appellant’s employment at

Victoria University of Wellington. She was authorised to approve payments up to

$10,000. In January 2013, the appellant set up a fictitious entity as a new vendor for contracting work, and proceeded to invoice the University, by way of 106 fictitious invoices, a total of $481,000 over the following three years. Reparation has taken

_{place as a result of separate civil proceedings.}

¹ _{Crimes Act 1961, s 228(b).}

REBEKAH LAURA PROCTOR v NEW ZEALAND POLICE [2016] NZHC 2656 [7 November 2016]

The sentencing decision

[3] In sentencing the appellant, the Judge took into account the aggravating features of the offending. They are summarised as follows:

(a) The money stolen was considerable, namely $480,000.

(b) The theft occurred over a two year 11 month period (the Judge noted

30 months).

(c) It was done on more than 100 occasions over a two year 11 month period.

(d) The offending was against a university which is a Crown entity, funded in-part by the Government.

(e) The offending was premeditated and was a gross breach of trust, given the high degree of autonomy in the appellant’s role.

(f) It was sophisticated.

(g) The offending only stopped when a senior manager discovered the discrepancies.

[4] Given the aggravating aspects of the offending, the Judge concluded the offending was serious and found the starting point was four and a half years’ imprisonment.

[5] He took into account the appellant’s previous good character, that she had not previously offended and allowed a discount of six months’ imprisonment. He allowed a further six month deduction for the reparation, which was to be paid. That lowered the starting point to three and a half years and from that, the appellant was given a full discount of 25 per cent for her plea of guilty and a 5 per cent deduction for remorse and attendance at the restorative justice meeting.

[6] The appellant was convicted and sentenced to two years and five months’ imprisonment. The appellant’s application for name suppression was declined, because the effects of publication on the appellant and her family were not such as to amount to extreme hardship.

The appellant’s submissions

[7] The appellant appeals the sentence, on the grounds that it is manifestly excessive and that the appropriate outcome was one of home detention and community work. The appellant contends that the Judge erred in the following respects:

(a) The starting point adopted was too high and should have been no more than three and a half years.

(b) The Judge did not have the benefit of a psychiatric report at sentencing. The appellant has now filed a psychiatric report, which she says ought to be taken into account in assessing the appropriate sentence.

(c) More credit should have been given for the appellant’s participation in

a restorative justice conference and for her remorse.

(d) The impact of imprisonment on the appellant’s two small children was not before the court and should be taken into account.

[8] The focus of this appeal is whether the Judge erred, either by taking an excessive starting point, or failing to give adequate discounts for the mitigating factors in this offending.

The starting point

[9] The Judge considered numerous cases that were provided by each of the appellant and the prosecution at sentencing. He then reached a starting point of four and a half years.

[10] The cases cited by the prosecution were noted as follows. In R v Davis, a four year starting point was upheld where the appellant stole $280,000 in her role as an office manager.² There, the scheme used was relatively sophisticated. In Mears v R the Court of Appeal upheld a starting point of four years and six months where the appellant had taken $380,000 from her employer over six years.³

[11] The Judge later noted the cases cited by the appellant. In R v Varjan, the appellant committed fraud in his role as a mortgage manager, where his activities caused loss of $546,000 (though he received only approximately $5,000).⁴ There, the starting point of four to five years was reduced on appeal to three years. It was relevant that Mr Varjan was a party to the offending and he had little to gain from his involvement in the fraud. Leave was granted to apply for home detention.

[12] In Murray v Police, the appellant obtained $174,633 by fraud committed in a variety of ways: processing unauthorised transactions with client credit cards, offering subscriptions to his magazine but not providing the promised goods and services, not paying invoices, not paying charities and dishonouring cheques.⁵ Some of this was reimbursed. A starting point of two and a half years was adopted. On appeal, Woodhouse J was satisfied that home detention should have been imposed instead of imprisonment.

[13] In Fitzmaurice v Police, the appellant was a Catholic parish priest who stole

$149,260 from the parish by using cheques, cash withdrawals and automatic payments.⁶ A starting point of three and a half years was overturned on appeal and instead a starting point of three years was adopted. Ultimately, home detention was the sentence imposed.

[14] On appeal, the appellant cites nine further cases. The most relevant of these cases (that is, those cases that involve similar types of fraud) are set out below:

² _{R v Davis [2009] NZCA 26.}

³ _{Mears v R [2014] NZCA 30.}

⁴ _{R v Varjan CA97/03, 26 June 2003.}

⁵ _{Murray v Police [2015] NZHC 1771.}

⁶ Fitzmaurice v Police [2013] NZHC 494.

(a) Din v R, where a four year starting point was adopted for fraud involving $842,000 over nine years.⁷

(b) Mitha v Police, where the defendant stole nearly $350,000 by generating false invoices over seven months.⁸ A starting point of four years was overturned on appeal in favour of a three year starting point, which took into account that the appellant had held all of the funds taken and was able to reimburse it immediately.

(c) R v Roberts, where the defendant stole a “considerable amount of money” that could not be quantified but was estimated to be between

$250,000 and $400,000. Some of the money was given to students in what was described as “misplaced altruism” and some of it was spent by the defendant on a house. A sentence of 10 months’ home detention and 300 hours of community work was imposed, which was seen as the appropriate sentence by both the prosecution and defendant.

[15] The appellant also cites Jooste v R, which is acknowledged as supporting a higher starting point.⁹ There, the appellant took approximately $350,000 from his employer, the Auckland City Council. As a result of civil proceedings, the appellant had repaid over $100,000. A starting point of four and a half years was accepted as being “well within the range available for such serious offending.”

[16] The appellant submits that the mitigating features of the offending, and absence of aggravating features, justify a lower starting point. The relevant features advanced by the appellant are: the lack of sophistication in the offending; there was

_{only one victim; and much of the money has been repaid.}

⁷ _{Din v R [2014] NZCA 316.}

⁸ _{Mitha v Police HC Auckland CRI-2006-404-266, 28 September 2006.}

⁹ Jooste v R HC Auckland CRI-2010-404-318, 16 November 2010.

Psychiatrist’s report

[17] The sentencing Judge took into account a report from the appellant’s counsellor, which confirmed the appellant was receiving treatment for depression. The pre-sentence report writer noted that the appellant claimed to be suffering from post-natal depression but this was not diagnosed at the time. At the time of hearing this appeal, a report from a forensic psychiatrist, Dr Barry Walsh, was available.

[18] Dr Barry Walsh notes that the appellant has a fragile mental state, and has suffered from a depressive illness, marked with three severe periods during which she was suffering distress. Importantly, her depression commenced in October 2012, prior to the time the appellant started offending. The second depressive illness was during her second pregnancy, at a time in November 2013 and the third, when the offending was discovered.

[19] The appellant submits that the psychiatric report shows that her depressive illness had a causative link with her offending and is therefore relevant to assessing the seriousness of the offending. In addition, it should be considered as a personal mitigating factor.

Impact on children

[20] The appellant also submits that the Judge failed to take into account the impact that imprisonment would have on her young children. Pursuant to s 9(4) of the Sentencing Act 2002, the court can take into account any other mitigating factor that it thinks fit. The appellant’s submission is that her incarceration is having an adverse effect on her children and this is confirmed by Dr Barry Walsh’s report.

Remorse and restorative justice

[21] The appellant accepts that the Judge made a small reduction in sentence to take account of her remorse and participation in a restorative justice conference. However, the appellant submits that the credit was insufficient, given the gruelling nature of the restorative justice conference, which was voluntary. Further, the

appellant has expressed remorse throughout the process. The appellant contends that the discount should have been at least 15 per cent.

The Crown’s submissions

[22] The Crown submits that the issue on appeal is whether the overall sentence is manifestly excessive, including the starting point and total discounts for mitigating features. The correct approach to s 250 of the Criminal Procedure Act 2011, which governs first appeals, is to first consider whether there has been an error.¹⁰ If the error is material and is of the requisite character, the appellate court will form its own view of the appropriate sentence.

[23] The Crowns submits that the starting point of four and a half years’ imprisonment was appropriate in these circumstances, taking into account the amount of money taken, the length of time over which it was taken, the number of dishonest transactions, the serious breach of trust, and that fact the offending only ended once it was discovered.

[24] In relation to the discounts for mitigating circumstances, the Crown submits that there was sufficient material before the Judge, even in the absence of a psychiatric report, sufficient discounts were given by the sentencing Judge for remorse and the effects on the appellant’s children and the offending justified a sentence of imprisonment in excess of two years, which meant home detention was not available. The Crown submits that home detention would have been an inappropriate sentence in the circumstances.

Analysis

[25] The first issue to be determined on appeal is whether the Judge erred in adopting the starting point of four and a half years. The Judge selected a starting point of four and a half years, after reviewing the authorities referred to by the prosecution and the appellant. The starting point of four and a half years is consistent with the starting points adopted in Jooste (four and a half years), Mears

(four and a half years) and Davis (four years), all involving gross breaches of trust for personal gain from relatively sophisticated schemes.

[26] I have contrasted the aggravating features in this case with the authorities cited by the appellant, as set out in [8] – [12]. Given the aggravating features in this case of gross breach of trust, the creation by the appellant or her staff of 106 invoices (albeit crude, as the appellant submits), the continued offending over two years 11 months and the amounts stolen from a partially Government-funded crown entity, with the appellant personally approving 90 of the invoices for payment to her personally, I concur with the Judge that those factors make this serious offending, such that the starting point of four and a half years was not manifestly excessive in the circumstances. The appellant received $481,000 and the offending stopped only when the discrepancies were discovered by a senior manager. I am unable to accept the appellant’s submission that the starting point for this offending was excessive and should not have been more than three and a half years.

[27] I turn then to consider whether the Judge gave insufficient credit or discounts for the appellant’s remorse, her voluntary attendance at the restorative justice meeting, her impaired mental health at the time the offending commenced, the amount of reparation paid, and the personal mitigating circumstances, involving her family and particularly her children.

[28] The Judge gave a discount of six months for the appellant’s good character and a further six months’ deduction in respect of reparation, which at that time was yet to be paid. The Judge noted that there will be a substantial amount still owing. Those sentence deductions lowered the starting point to one of three and a half years and in addition, a 30 per cent reduction was given for the appellant’s plea of guilty (in accordance with Supreme Court authority of R v Hessell of 25 per cent)¹¹ and five per cent for remorse, including the appellant’s offer to pay reparation and her attendance at a restorative justice meeting.

[29] At the time of sentencing, the Judge did not have Dr Barry Walsh’s

psychiatric report or the amount actually repaid in reparation and the loss sustained

by the family in paying it. In noting that the appellant had attended a restorative justice meeting, the Judge observed this “would have been of considerable effort to you” and had earlier recorded that he accepted that “that is a substantial thing to take into account as far as your sentence is concerned”.

[30] On appeal, the appellant submits that the deduction of 5 per cent only for the appellant’s remorse, the restorative justice attendance and her willingness to make amends was insufficient. Further, there was no deduction for the appellant’s impaired mental health and the mitigating factor of the effect of the appellant’s imprisonment on her three and five year old children.

[31] With the benefit of the psychiatric report of Dr Barry Walsh at this appeal hearing, two relevant and mitigating factors are addressed, which were not before the sentencing judge.

[32] The first relates to the appellant’s depressive illness, which commenced in October 2012, before the offending started in January 2013, when the appellant became unexpectedly pregnant again and was struggling to meet the demands of a small child, working, suffering sleep deprivation, and coping with the stresses and demands of work, financial pressure and difficulty in raising children.

[33] Dr Barry Walsh describes the appellant as someone with a fragile mental state with the depressive illness developing in parallel with the offending, culminating in a recognised depressive illness on the discovery of her offending. Given that the disorder started before the offending, there is a nexus between the offending and the disorder.

[34] I accept the Crown’s submission that s 9(2)(e) of the Act is not applicable, as the appellant did not have a diminished intellectual capacity or understanding. However, a fragile mental state is a relevant mitigating factor under s 8(h), where a sentence of imprisonment will weigh more heavily on the appellant than on others, because of her depressive illness or mental impairment suffered at the time. In Fitzmaurice v Police, Panckhurst J considered that depressive disorders did not fall within the purview of s 9(2)(e), but they are still relevant to the final disposition of

the case. He considered it was one of the deciding factors that justified home detention as an appropriate sentencing option.¹² Here, the psychiatric analysis provides a causal link between the appellant’s growing depressive illness and the offending, and I consider it justified a greater reduction in the sentence.

[35] The second matter addressed by the psychiatric report was the substantial impact of the appellant’s imprisonment on her two children. Both young boys have been deeply affected by the loss of their mother as their caregiver. Although inevitable in this type of offending and ultimate sentencing, the appellant’s children are innocent victims of the offending. In Ransom v R, the need to provide care for young children was a recognised factor that required balancing in the assessment of

the overall sentence.¹³ Ms Ransom’s son was aged six years and the Court of Appeal

quashed the term of imprisonment and imposed nine months home detention and 75 hours community work in recognition of the needs of the appellant to care for her child and her support for her husband to engage in paid employment.

[36] Ms Hall for the appellant advised that the childcare centre, at which the youngest of the appellant’s children attends, has been forced to close down, compromising the ability of the appellant’s husband to both care for the children and continue in his modestly paid employment. It is a relevant factor, as the Court held in Ransom.

[37] There are additional factors, which I consider relevant, and they are the amount of reparation paid, the appellant’s intention to make further reparation payment and the appellant’s attendance at the restorative justice meeting. The appellant has made reparation of $250,000, by the sale of the family home, car, assets and the family’s bank accounts. Although civil action was commenced to recoup the University’s losses, the appellant cooperated in the sale of the family home and assets to make reparation. This indicates a great degree of remorse.

[38] The Judge accepted that the appellant attended a restorative justice meeting at

_{“considerable effort” and although recognising that the collection of former}

¹² _{Fitzmaurice v Police above n [6].}

¹³ Ransom v R [2010] NZCA 390.

colleagues, requiring the appellant to answer for her offending, “is a substantial thing to take into account as far as your sentence is concerned”, I do not think the 5 per cent discount given for the remorse shown and attendance at a restorative justice meeting was adequate.

[39] The restorative justice meeting took two and three quarter hours, with 17 people present. Although constructive, it was challenging and a very emotional and difficult exercise for the appellant, as the restorative justice conference report attests. The appellant’s participation was voluntary.

[40] Genuine remorse and the offender’s offers to make amends, apologise, or take remedial action are factors the Court may take into account under s 10 of the Act. Under s 8(j) of the Act, however, the Court must take into account any actions in relation to restorative justice processes.

[41] In R v Shirley,¹⁴ the Court of Appeal approved a six month or a 15 per cent reduction for restorative justice considerations. I am satisfied that the appellant’s remorse, the appellant’s consent to the civil court proceedings for sale of the family home, the efforts to make amends by selling family assets, chattels and jewellery and her attendance at the restorative justice conference justify a greater reduction than five per cent. With the additional consideration of the adverse effect on the children, I consider an appropriate discount is 15 per cent.

[42] On the basis the Judge’s sentence starting point is not in error, I apply the following discounts to the four and a half year starting point (54 months):

(a) Reductions of six months for good character and six months for reparations made.

(b) A further reduction of three months to take account of the appellant’s

_{depressive illness. This brings the starting point to 39 months.}

¹⁴ R v Shirley [2009] NZCA 216.

(c) With 25 per cent discount for guilty plea and 15 per cent for her attendance at the restorative justice meeting, remorse and the impact on her family and children, the end sentence is 23 and a half months.

[43] The next issue is whether home detention should be substituted for imprisonment, given the reduction in sentence.

[44] Whether or not to impose home detention is a discretionary decision. Home detention can be considered where a short sentence of imprisonment would otherwise be imposed. Section 80A of the Sentencing Act 2002 provides:

80A Sentence of home detention

(1) A court may sentence an offender to a sentence of home detention if—

(a) the offender is convicted of an offence punishable by imprisonment; or

(b) the offender is convicted of an offence and the enactment prescribing the offence expressly provides that a sentence of home detention may be imposed on conviction.

(2) A court may sentence an offender to home detention under subsection (1) if—

(a) the court is satisfied that—

(i) the proposed home detention residence is suitable; and

(ii) the relevant occupants (as defined in section 26A(4)) of the proposed home detention residence—

(A) understand the conditions of home detention that will apply to the offender; and

(B) consent to the offender serving the sentence in the residence in accordance with those conditions; and

(C) have been informed that they may withdraw their consent to the offender serving the sentence in the residence at any time; and

(iii) the offender has been made aware of and understands the conditions that will apply during home detention, and he or she agrees to comply with them; and

(b) the proposed home detention residence is in an area in which a home detention scheme is operated by the chief executive of the Department of Corrections.

(2A) Before imposing a sentence of home detention on an offender, a court must consider the pre-sentence report prepared by a probation officer in accordance with section 26A.]

(3) A sentence of home detention may be for such period as the court thinks fit, but must not be for less than 14 days or more than 12 months.

(4) The court must specify the home detention residence when sentencing the offender to a sentence of home detention.

(5) An offender sentenced to home detention is not in custody while serving the sentence.

(6) This section is subject to section 80B.

[45] In deciding whether to impose home detention instead of imprisonment, an appellant’s personal circumstances are relevant. Of particular relevance here are the appellant’s depressive illness, her rehabilitative efforts and the impact that her imprisonment already has on her young children. This must be weighed against the seriousness of the offending.

[46] Does a sentence of home detention meet the aims of sentencing, including holding the appellant accountable and denouncing her conduct? In Ransom v R, the Court of Appeal considered home detention in the context of a benefit fraud case and held that a sentence of home detention, in conjunction with one of community work, would adequately meet the sentencing goals of accountability, denunciation and deterrence.¹⁵ The Court noted that there is no prescriptive sentence in such cases and that in each it must be decided on a case by case basis whether home detention would respond to the particular offending or whether a sentence of imprisonment is

required. In fixing a sentence of home detention, the Court took into account the time Ms Ransom had spent in custody and imposed a sentence of nine months home detention plus a sentence of 75 hours’ community work.

[47] At the time of the appellant’s sentencing, the Department of Corrections’ advice to the court referred to other possible sentencing options, as an alternative to imprisonment, being home detention or community work. The Department proposed special conditions for home detention, namely, that the appellant undertake and complete the appropriate counselling and abide by the rules of the programme to the satisfaction of a probation officer.

[48] In addition to the appellant’s personal circumstances summarised in para

_{[45], I am also mindful of the need to consider imposing the least restrictive}

¹⁵ Ransom v R above n 13.

outcome, as required by the Act. The Courts have held that there is a considerable measure of deterrence and denunciation in a sentence of home detention, for a person sentenced up to 12 months’ detention, to spend their time at home.¹⁶

[49] The appellant has served four months of her present sentence, which equates to an eight month sentence. Taking that into account but retaining the purpose of the sentence for serious offending, I substitute for the prison sentence, a sentence of 12 months’ home detention (without deduction), subject to the special condition that the appellant undertake and complete the appropriate counselling and abide by the rules of the programme to the satisfaction of her probation officer. In addition, I impose a sentence of 100 hours’ community work.

Result

[50] The appeal against sentence is allowed. The sentence of two years 5 months’

imprisonment is quashed and I substitute for the prison sentence the following:

(a) the appellant is sentenced to 12 months’ home detention, subject to the special condition that the appellant undertake and complete the appropriate counselling and abide by the rules of the programme to the satisfaction of her probation officer; and

(b) the appellant is further sentenced to 100 hours’ community work.

_{Cull J}

¹⁶ R v Iosefa [2008] NZCA 453; Brown v The Police (Lang J, High Court Whangarei, 12 May

2011, CRI-2011-488-27).