Kai Yip Cheung v R

• Jurisdiction: New Zealand
• Judge: Miller J
• Judgment Date: 11 May 2021
• Neutral Citation: [2021] NZCA 175
• Court: Court of Appeal
• Docket Number: CA415/2020
• Date: 11 May 2021

Between

Kai Yip Cheung

Appellant

and

The Queen

Respondent

[2021] NZCA 175

Court:

Kós P, Miller and Collins JJ

CA415/2020

IN THE COURT OF APPEAL OF NEW ZEALAND

I TE KŌTI PĪRA O AOTEAROA

Criminal Procedure, Criminal Sentence — application for leave to appeal out of time — the appeal was filed three years out of time — the appellant sought to appeal against a sentence imposed for methamphetamine trafficking on the ground it was calculated in error — the appellant argued that a 2020 Court of Appeal decision which set out a new two-step sentencing methodology under which the appellant would have received a lesser sentence, was an ordinary overruling of an earlier judgment and operated retrospectively under the declaratory theory of law — Sentencing Act 2002

Counsel:

JEL Carruthers and S J Bird for Appellant

M J Lillico and T R Simpson for Respondent

• A The application for an extension of time is granted.

• B The appeal is allowed in part.

• C The order for a minimum period of imprisonment is quashed.

JUDGMENT OF THE COURT

REASONS OF THE COURT

(Given by Miller J)

1 For trafficking in methamphetamine Mr Cheung was sentenced in 2017 to a term of 15 years, five months' imprisonment with a minimum period of imprisonment of nine years. 1 He now wants to appeal his sentence.

2 Because his right of appeal expired three years before he filed his papers, Mr Cheung needs the Court's permission, in the form of an extension of time. He says the delay is excusable and the appeal has merit: the sentence was calculated in error, the starting point of 25 years was too high, and the minimum period of imprisonment was unwarranted.

3 The claim that the sentence was calculated in error raises an issue about the retrospective application of the two-step sentencing methodology adopted in the Court's 2020 decision in Moses v R. 2 Mr Cheung says that Moses was an ordinary overruling of an earlier judgment of the Court, Hessell v R, 3 and so operates retrospectively under the declaratory theory of law. The Crown disagrees. It says that as a guideline judgment Moses operates prospectively and it should be applied to a past sentence only when it is apparent that the sentence was materially wrong and there are special circumstances. It opposes the extension of time in Mr Cheung's case, saying the delay is not adequately explained and the sentence was not manifestly excessive.

Mr Cheung's sentence

4 We record that Mr Cheung was sentenced on 9 May 2017 under the applicable guideline judgment at the time, Fatu v R. 4 This Court has since updated methamphetamine sentencing guidelines in Zhang v R, but that judgment states that it applies to all sentencing that takes place after 21 October 2019. 5 It is common ground that Fatu applies to this case.

5 Mr Cheung was one of a group of offenders who imported very large quantities of methamphetamine in 2016. The offending was sophisticated and of some duration. Containers containing scaffolding were shipped to a company, Hong Jun International Trading Ltd, that was set up in New Zealand for the purpose of receiving them. Methamphetamine was secreted in the containers' door-locking rods, which were

dismantled at a warehouse leased by the company. This method had been used on four occasions before the importation with which Mr Cheung was charged

6 The moving force behind the operation appears to have been a Hong Kong national, Kam Tong Lee. After he was refused entry to New Zealand in July 2015 he delegated control of importations to Choo San Teh, who was later charged with Mr Cheung. Mr Teh handled all of the paperwork required for the importation of scaffolding and made lease payments on the warehouse, which had been leased for a term of six years.

7 Mr Cheung arrived in New Zealand on 13 December 2015, ostensibly for a ten-day holiday. He was with another man, Cho Fai Chu, who left New Zealand on 23 December 2015. Mr Cheung, who was aged 19, did not leave. He obtained a student visa and in March 2016 he enrolled in a three-month English language course. He received three warning letters for poor attendance and did not sit any final assessments. He remained in New Zealand after completing the course. He later admitted that his living expenses were funded by Mr Chu, who offered him an opportunity to make money in New Zealand. He knew this would involve drugs.

8 Hong Jun International Trading imported containers on 17 February and 2 March 2016, after Mr Cheung had arrived in New Zealand, but he was not ultimately charged in relation to these importations.

9 On 6 July 2016, a container vessel arrived in New Zealand carrying ten containers for the company. In total, they held 176 kg of methamphetamine. Its street value was in the range $70 million to $212 million. The importation was monitored, including cellphone traffic among the offenders. A search warrant executed at Mr Cheung's residential address resulted in the seizure of phones, a lease agreement for the warehouse and a document detailing the individual parts of a container door rod. When confronted with records, Mr Cheung admitted that he had been paid for his work for Hong Jun International Trading. He faced one charge of importing methamphetamine.

10 Mr Cheung maintained that he intended to study English and initially believed his role would be only short-term. He claimed he had told Mr Chu he no longer wanted to be involved once he realised his role would be lengthier. He tendered references from family and others who deposed to his good character.

11 The Judge reviewed the facts, noting that Mr Cheung had said he wanted to make some “fast and easy money”. 6 Mr Cheung had not come to New Zealand to study English; his priorities were elsewhere. The Judge made it clear that he would not take the previous importations into account, however. Mr Cheung had been charged in relation only to the 176 kg imported in July 2016. That was a staggering quantity, qualifying as one of the largest seizures in this country. He noted the maximum sentence, life imprisonment, but said he would not adopt it having regard to Mr Cheung's age, lack of previous convictions, guilty plea and “supporting rather than managerial role”. 7

12 The Judge did not accept a submission that Mr Cheung's role was analogous to that of a catcher or mule. The operation was set up by others, but Mr Cheung assisted in the importation and extracted the drugs from the containers. His job was “to follow orders and do the risky work”. 8

13 A starting point of 25 years was adopted, the Judge citing two comparable cases, Chen v R 9 and R v Chan. 10 He remarked that for those further up the chain a considerably higher starting point, perhaps life imprisonment, would be realistic. He allowed a three-year discount for youth and prospects of rehabilitation and a discrete discount of five per cent for other matters. He also allowed a full guilty plea discount of 25 per cent. Mr Cheung was charged on 5 October 2016 and entered a guilty plea on 29 March 2017, but Moore J accepted that there had been a change of counsel and some communication difficulties. The resulting sentence was 15 years and five months' imprisonment.

14 The Judge also imposed a minimum period of imprisonment of about 60 per cent or nine years. He found that necessary to reflect harm done and the need for denunciation and deterrence. He cited Zhou v R for the proposition that the statutory minimum period of one-third will usually not suffice to meet the sentencing purposes in s 86(2) of the Sentencing Act 2002. 11

Submissions on retrospectivity and extension of time

15 Mr Carruthers, for Mr Cheung, submitted that judicial decisions ordinarily have both retrospective and prospective effect. Sentencing guideline judgments differ in that they are usually expressed to apply from a particular date, giving them limited retrospective effect. Their retrospective application is limited because they reflect evolution in sentencing policy and practice. But Moses is not a guideline judgment; rather, it established that sentences imposed using the three-step methodology were wrong in principle. Accordingly, it is an ordinary overruling which, on the declaratory theory of law, applies retrospectively. This does not mean that all sentences imposed under the three-step methodology were miscalculated, in the sense that but for the methodology the judge would have imposed a lesser sentence. Nor does it mean that those sentences were manifestly excessive. It means rather that an appellate court should apply the two-step methodology when considering appeals against sentence, whenever the offending and sentencing occurred. Further, the appellate court should take change in law into account when considering applications for an extension of time. Floodgates considerations are unlikely to arise, and in any event they should yield where the liberty of the subject is at stake.

16 Mr Lillico, for the Crown, emphasised that jurisdiction to overturn a sentence on appeal is governed by the Criminal Procedure Act 2011, which provides that a sentence may be overturned only where an error is found and the appellate court is satisfied that a different sentence should be imposed. It is ordinarily necessary to show that the sentence was manifestly excessive or inadequate. 12 Moses does not alter this settled approach to sentence appeals. And as the Court noted there, the three-step methodology will seldom result in a manifestly excessive sentence when the outcome

is compared to the two-step methodology. 13 Nor should the outcome be characterised as a calculation error, or error of principle, since the methodology is merely a guide intended to achieve transparency and consistency in sentencing. Moses did not change that. In any given case the sentencing judge ought to have stood back and inquired whether the sentence was just having regard to applicable sentencing...