Kayrouz v R

• Jurisdiction: New Zealand
• Judge: Randerson,Venning,Cooper JJ
• Judgment Date: 14 April 2014
• Neutral Citation: [2014] NZCA 139
• Docket Number: CA375/2013
• Court: Court of Appeal
• Date: 14 April 2014

BETWEEN

Simon Lindsay Kayrouz

Appellant

and

The Queen

Respondent

[2014] NZCA 139

Court:

Randerson, Venning and Cooper JJ

CA375/2013

IN THE COURT OF APPEAL OF NEW ZEALAND

Appeal against conviction following a jury trial on five counts relating to the possession and manufacturing of methamphetamine — appellant was alleged to be a member of a conspiracy to manufacture and supply drugs — appellant challenged the admissibility at the trial of intercepted communications, involving the leader of the conspiracy and others but made in the appellant's absence — appellant argued that there was not reasonable evidence on an objective basis that he was a participant in the conspiracy without reference to the intercepted communications and that hearsay statements in the intercepted communications were inadmissible — also argued that they were not admissible under co-conspirators rule as were not made in furtherance of the conspiracy — whether there had been reasonable evidence to convince the Court of appellant's membership in the conspiracy — whether a broad or narrow approach should be adopted to identifying whether a statement was made in advancing or furthering the conspiracy.

counsel:

P G Mabey QC for Appellant

J M Jelas for Respondent

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

• B The appeal is dismissed.

JUDGMENT OF THE COURT

REASONS OF THE COURT

(Given by Cooper J)

Introduction

1 The appellant, Simon Kayrouz, and four co-offenders were charged with offending under the Misuse of Drugs Act 1975.

2 The Crown alleged that one of the appellant's co-offenders, Stephen Gray, led a conspiracy to produce methamphetamine and distribute methamphetamine, LSD and cannabis. It was alleged that Mr Gray was the instigator and that he engaged the services of the appellant and others. It was the Crown's case that the appellant was the cook who manufactured the methamphetamine for Mr Gray. Other co-offenders, Messrs Haine, Murphy and Carlisle were allegedly responsible for the onward distribution of drugs supplied to them by Mr Gray.

3 Mr Gray pleaded guilty at the commencement of the trial to five counts relating to the supply or possession for supply of methamphetamine and LSD, and the sale and cultivation of cannabis. He denied any part in the manufacturing of methamphetamine.

4 The appellant was charged in five counts of a 16 count indictment. They were:

• (a) Count 1, alleging that the appellant and Mr Gray manufactured methamphetamine.

• (b) Count 2, alleging the appellant, Mr Gray and others supplied methamphetamine.

• (c) Count 14, alleging that the appellant was in possession of pistols without lawful, proper and sufficient purpose.

• (d) Count 15, alleging the appellant and Mr Gray had in their possession precursor substances (hydrochloric acid and sulphuric acid) with the intention that those substances be used to manufacture methamphetamine.

• (e) Count 16, alleging that the appellant and Mr Gray possessed equipment and material capable of being used for the manufacture of methamphetamine with the intention that the equipment and material be used for that purpose.

5 The appellant was convicted on all five counts after a jury trial before Priestley J. 1 He now appeals against his conviction. Although three grounds of appeal were raised in the notice of appeal, the only ground pursued is a challenge to the admission at the trial of intercepted communications, derived from interception devices that had been installed in and around Mr Gray's home. The Crown sought to rely on the intercepted communications, claiming they were admissible against the appellant pursuant to the co-conspirators' rule.

6 Trial counsel for the appellant sought to challenge the admissibility of the intercepted communications prior to the trial and at the outset of it. However, Priestley J considered that the issue would be more appropriately addressed at the conclusion of the Crown's case. 2 Mr Mabey QC, who has appeared for the appellant on the appeal accepts that was a sensible course to follow. In the result the issue was raised as the basis of an application for discharge under s 347 of the Crimes Act 1961 at the conclusion of the Crown's case, but rejected by the judge. 3

7 Mr Mabey accepts that there was evidence that Mr Gray was involved in an unlawful joint enterprise with somebody. However, he contends that there was insufficient evidence to satisfy the Court on an objective basis that the appellant was a participant in the conspiracy. It followed that hearsay statements in the intercepted communications were inadmissible. An additional argument advanced is that the statements in question were not made “in furtherance of” the conspiracy, and should have been rejected for that reason. Mr Mabey submits that in the circumstances the Judge was wrong to allow the Crown to refer to and rely upon the statements in its case against the appellant. It followed that there was a real risk of a miscarriage of justice.

Membership of the conspiracy

Relevant facts

8 The appellant lived rent-free in a house situated on a farm owned by Mr Gray, at Mangakino Road, Te Uku. The farm was managed by a Mr Ross, who lived on another property owned by Mr Gray located on the other side of the Hamilton/Raglan Highway. 4 The properties were linked by a tunnel passing under the road.

9 When first interviewed by the police the appellant said that he was able to live rent-free in the farmhouse in exchange for work on the farm, and he described himself as a farm hand. He said that there was a farm manager who came and went from the property from time to time, but he did not know his name. He described the work he carried out as “fixing broken fences and that sort of thing”. He was unable to provide what his nominal rate of pay was, claiming that he simply worked “until it was about right”.

10 On a subsequent occasion, he told the police that he knew the farm manager's name was Graeme, although he did not know his last name. He said he was an electrical engineer, but not doing much of that work at the moment, because he was working on the farm. Asked what sort of work he did, he said “general farm hand stuff, moving cattle, fencing, that sort of stuff”. He confirmed that he lived in the house, and said that he worked in exchange for his rent and power.

11 At the trial Mr Gray gave evidence inconsistent with the appellant's account. He described the work done by the appellant as repair, welding and electrical work. Although the appellant would help Mr Ross and would shift stock when Mr Gray was not able to do so, Mr Gray said that the appellant was “not the best stockman”. He also denied that the appellant lived on the land rent-free, stating that from time to time that he would receive cash from him to “make up” or “have a square up”.

12 The police searched the appellant's house, sheds associated with it and the farm itself on three separate occasions. On the first occasion, at five different locations referred to as sites A–E, the police discovered equipment and substances able to be used in the manufacture of methamphetamine. The sites were within easy walking distance from the appellant's house, and could also be accessed from there by farm bike. Evidence found at those sites included hydrophosphorous acid, 5 a caustic liquid containing pseudoephedrine (which had been extracted), hydrochloric acid, phosphorus acid, a Parr bomb, and a condenser. In addition, other items were found which are commonly associated with the manufacture of methamphetamine and dealing in that drug. These included firearms, cutting agents, electronic scales and plastic snaplock bags.

13 Methamphetamine was detected on a number of items and two snaplock bags containing methamphetamine were located. The amount of methamphetamine totalled 8.4 grams.

14 Some of the items found were wrapped in newspapers with dates between 31 January and 18 March 2009, within the period when the Crown alleged manufacturing took place, and at a time when the appellant was residing in the house on the farm.

15 There was evidence linking the appellant and Mr Gray to items found at sites A–E. At site B, a Sistema container bearing traces of methamphetamine was located. Another Sistema brand container which tested positive for methamphetamine was found in a shed attached to the appellant's dwelling. Sistema brand containers were also located at Mr Gray's house, some actually containing methamphetamine and others which tested positive for methamphetamine.

16 In a subsequent search, the police found a receipt for four camouflage tarpaulins at the appellant's house. Camouflage tarpaulins of the type described on the receipt were found in a black plastic box marked with a white skull and crossbones, in a shed attached to the appellant's dwelling. The box also contained

numerous methamphetamine pipes wrapped in newspapers, a 20 litre plastic container of caustic liquid containing pseudoephedrine, and camouflage netting. A black container with the same distinctive skull and crossbones design was located on the farm at site C. The items found there were covered by camouflage tarpaulins, albeit of a different design (incorporating netting) to those found in the appellant's garage. In relation to the design of the camouflage, Mr Mabey accepted that there was evidence that similar tarpaulins to those found in the black plastic box were found with some of the items secreted on the farm

17 The police also located a receipt for the purchase of acetone from a local hardware store, in the appellant's garage.

18 At the time of the first search of the appellant's house, the police found a sum of a little over $4000. There was no credible explanation for the presence of the money.

19 The Crown also sought to rely on the intercepted communications to which we have earlier referred. Most of those were on occasions when...