Rex v Veikune [2006] TOSC 4; CR 90-91.2005 (16 February 2006)

IN THE SUPREME COURT OF TONGA
CRIMINAL JURISDICTION
NUKU’ALOFA REGISTRY

NO CR 90-91/05

R

V

TU’IVAI & HON VEIKUNE

SENTENCING REMARKS

‘Amini Tu’ivai and Hon Veikune, you have both been found guilty of the offence of attempting to evade Customs import duties on 600 cartons of over proof Bounty rum in a container. You, Hon Veikune, have also been found guilty of the offence of bribery of a Government servant.

Circumstances of the offences

The circumstances of the offence were that the container was consigned to you, Hon Veikune, from Fiji in July 2003, although it appears that the arrangements for sending it were made by Mr Tu’ivai. A copy of the invoice for the rum from the manufacturers in Fiji, South Pacific Distilleries Ltd, was found in Mr Tu’ivai’s papers. The contents were described in the bill of lading as assorted goods and personal effects, which was borne out by the invoice from Westline Agency, Fiji addressed to Hon Veikune and presented to Customs for import entry by Mr Tu’ivai through Customs agent Sione Vaka’uta. But it was clear from the evidence that by the time the container arrived in Tonga, or very shortly after that, you both knew that it contained a quantity of Bounty rum. Together you then attempted to have the container released by Customs without its contents being inspected. You tried various avenues to achieve this when the container was held at the wharf for inspection.

Hon Veikune went in August 2003 with the documentation to his nephew Sione Lutu, a Revenue Officer in the Compliance Division, and asked him to help in trying to release the container, then he went twice to see Customs officer ‘Ofa Taufa and the second time, very early in the morning, asked him for his assistance "in getting the container released", handed him a bundle of money ($1000 in bundles of $10) and asked could he give him a hand in trying to get the container out from the wharf, saying that if the work was completed he would give him a double. Later that day ‘Ofa Taufa returned the money by the hand of his son ‘Etuate as in his conscience and legally it was wrong.

Then there were the incidents at the wharf when the container was about to be inspected and was inspected, when Mr Tu’ivai asked Kelemete Vahe of Compliance Division what was his price and “How much would it cost so that the container would not be inspected” and told him that in the past he had given $10,000 to Fa’one Bloomfield and other superior officers in the Customs Department. While the container was being examined Mr Tu’ivai was angry and asked Customs officers “Why is my container being examined, whereas a container with alcohol belonging to an Indian man was released the previous week?” (which was also said by Hon Veikune) and Mr Tu’ivai said “If this reached the courts some men would take a fall”. Then when the rum had been found, Mr Tu’ivai again spoke to Kelemete and said to him “Today my glasshouse is being broken”. Almost none of these things were challenged in cross-examination.

When the container was eventually inspected it was found to be around two-thirds full of 600 cartons of Bounty rum and was held by Customs. The duty on that would have amounted to almost $300,000. The cost price of the rum had been $85,200 in Tongan currency.

When Mr Tu’ivai’s house was searched later he said entirely voluntarily to Asst Chief Insp Tu’ihalangingie that Fa’one Bloomfield had already received $60,000 in 2002 for 5-10 containers; and that he Mr Tu’ivai was in a tangle.

These were regrettably very serious offences: in plain words you were involved in an attempt at smuggling a large quantity of liquor into Tonga. I regret that I was unable to accept Mr Edwards’ submission in mitigation that because you went through the normal channels that somehow made it different. The Shorter Oxford English Dictionary defines smuggling as conveying goods clandestinely into a country in order to avoid payment of legal duties, which to me is precisely what was being attempted here.

The offences were clearly deliberate and pre-meditated and I believe you both knew exactly what you were doing. In a country such as Tonga where the Government has a limited source of revenue, it is extremely important that the Government should be able to collect all the revenue due under the laws passed by Parliament. Your actions in relation to this one container were aimed at depriving the Government and hence the people of Tonga of a significant amount of revenue - $300,000 – as Mr Tu’utafaiva put it, part of the main life blood of the country. Because of the quantity involved, there can be no other inference than that it was a commercial operation attempted for personal gain. With reference to Mr Edwards’ submission about the role of Sione Vaka’uta, it is no use those who are caught saying that they should not be punished unless all the others are caught too: R v Jones & ors (1981) 3 Cr App R (S) 238 (CCA).

Maximum sentences

The maximum sentence for bribery of Government servant is imprisonment for any period not exceeding 3 years. The Court may impose a fine instead of imprisonment (s 30) and may grant time of not longer than 3 months to pay the fine (s 27), but shall direct that if the person fails to pay the fine at the time appointed he shall be imprisoned for a period not exceeding 1 year unless the fine is sooner paid (s 26(1)).

The penalty for attempting to evade Customs duties is a penalty of not exceeding treble the value of the goods or $2,000 whichever is the greater. It is clear from section 257(1) of the Customs and Excise Act (Cap 67) and Vakameitangake v R [1998] Tonga LR 141 (CA) [where Mr Tu’ivai acted for one of the defendants, so he cannot have been ignorant of the potential penalties he was incurring] that the value of the duty due on the goods has to be added to the value of the goods themselves. That penalty has been amended since the case of Vakameitangake and the subsequent case of R v Fiu [1999] TOCA 21 (CA) to allow the Court discretion instead of imposing a mandatory penalty of treble the value. Under section 247 of Cap 67 the Court may order a period of imprisonment (not restricted to 1 year) in default of payment of the penalty. Section 210(1) also provides that all goods in respect of which the offence is committed shall be forfeited (ie the maximum penalty is in addition to that) and section 217(2) provides that the goods are to be disposed of as the Chief Commissioner may direct.

Guidelines and appropriate sentences

In addition to the obviously firm views on sentence taken by the Tongan Court of Appeal in these 2 recent cases, I have obtained guidance from 3 recent cases in England, 2 of which are referred to in Archbold 2005 Para 25-481. They are R v Dosanjh, R v Czyzewski & ors and R v Ollerenshaw. While they are given against the background of a statutory maximum in England of 7 years imprisonment for this offence and thus are not strictly of relevance in Tonga where there is no penalty of imprisonment for this offence, the guidelines demonstrate the seriousness with which the Court should treat such offences and the way in which the circumstances of the particular offence should be regarded.

In R v Dosanjh [1998] EWCA Crim 1450, [1999] 1 Cr App R 371 (CA) the Court of Appeal set out guidelines for cases involving the illicit import of alcohol and tobacco, stating:

“The courts need to distinguish between three broad categories of offenders: those who import comparatively small quantities on a few occasions; those who, acting on their own, or possibly with one other, persistently import greater quantities, and those in organised gangs, involved in importation on a large commercial scale.

There is, in our judgment, a need for a deterrent element in sentencing, particularly when significant amounts of duty are evaded by repeated organised expeditions, which lead to distribution subsequently on a commercial scale. In those cases, good character and personal circumstances will be of comparatively little mitigating significance.

In the light of all these considerations, and in an attempt to achieve a greater degree of uniformity in sentencing than has always been apparent hitherto, we suggest the following guidelines by reference to the amount of duty evaded. We stress that these are guidelines only, and that in addition to the amount of duty evaded, many other factors which we have earlier identified in this judgment, have a role to play in sentencing.”

After advice from the English sentencing advisory panel, these guidelines were later modified in R v Czyzewski & ors [2003] EWCA Crim 2139; [2004] 1 Cr App R (S) 49 (CA). It is stated in Archbold at Para 25-481:

“In R v Czyzewski [2003] EWCA Crim 2139; [2004] 1 Cr App R (S) 49 (CA), it was held that the guidelines issued in respect of professional smuggling in R v Dosanjh [2009] EWCA Civ 1291; [1999] 1 Cr App R 371 (CA), needed modification in the light of the suggestions of the Sentencing Advisory Panel. In assessing seriousness, the principal factors to be taken into account are the level of duty evaded, the complexity and sophistication of the organisation involved, the defendant's function within the organisation and the amount of personal profit; matters of aggravation (beyond what is implicit in the foregoing) were repeated importations (particularly after a warning), using a legitimate business front, abuse of a privileged position, using children or vulnerable adults, threatening violence to any law enforcement officer, dealing in goods with additional health risk of contamination, and disposal of goods to under-age purchasers.

Appropriate starting points on conviction of a person with no relevant previous convictions would be a moderate fine, or, where there was strong personal mitigation, a conditional discharge where the duty evaded was less than £1,000; where the duty was up to £10,000, in the case of a first-time offender or an offender at a low level in an organisation or persistently as an individual, a community sentence, or higher level fine; for cases involving up to £100,000 where the defendant operated individually or at a low level in an organisation, up to nine months' custody; where the duty evaded exceeded £100,000, the custodial sentence would be determined by the degree of professionalism and the presence or absence of aggravating factors; for cases up to £500,000, the range would be nine months' to three years'; for cases up to £lm, up to five years'; and in excess of that amount, up to seven years'; it was to be stressed that the foregoing were guidelines not a straitjacket; and sentencers should also remember their powers of confiscation, compensation, and deprivation”

But in R v Ollerenshaw [1999] 1 Cr App R (S) 65, [1998] Crim LR 515, [1998] EWCA Crim 1306 (CA), referred to in Dosanjh, it was stated:

“Parliament has provided a maximum sentence of 7 years for evading duty when importing alcohol and tobacco, and the courts have on occasions imposed sentences close to that figure.

The authorities show that those who evade significant amounts of duty by such conduct should expect to go to prison. The term of imprisonment will obviously be affected by a number of factors, including the amount of duty evaded. Aggravating features which are likely to increase the sentence include playing an organisational role in the importation; making importations repeatedly over a period of time; continuing to make importations despite a warning from the Customs and excise authorities; and importing more than one type of dutiable goods, for example, alcohol and tobacco.

Mitigation will lie, as in almost all offences, in a prompt plea of guilty; as in many offences, in previous good character; and, as in some offences, in the personal circumstances of the offender.

We add these comments, which are not limited to duty evasion cases, but are intended to apply to all offences. When a court is considering imposing a comparatively short period of custody, that is of about 12 months or less, it should generally ask itself, particularly where the defendant has not previously been sentenced to custody, whether an even shorter period might be equally effective in protecting the interests of the public, and punishing and deterring the criminal. For example, there will be cases where, for these purposes, 6 months may be just as effective as 9, or 2 months may be just as effective as 4. Such an approach is no less valid, in the light of today's prison overcrowding, than it was at the time of R v Bibi (1980) 71 Cr App R 360.”

Common factors in sentencing

There are factors in relation to sentencing which are common to you both. I have read and taken into account the Probation Service Reports and the submissions in mitigation by your Counsel. I regret that I cannot make light of the case, as you were deliberately trying to evade a huge amount of duty. It was not simply smuggling for your personal use, it was a fairly large scale commercial operation. These were offences of dishonesty.

Although I am sentencing only in this one case and do not take into account what has been said about this happening before, yet I cannot regard it as a one-off operation. Nor can I close my eyes to it being common knowledge that smuggling in this way has been rife at the wharf. I believe there must be a measure of both punishment and deterrence in the sentences and I regret that I cannot accept Mr Edwards’ submission that rehabilitation should feature largely in them.

On the positive side of mitigation, you are both first offenders of previous good character, though that can be of comparatively little mitigating significance. It is to your credit that you have now both accepted the verdict of the Jury and expressed remorse – and that is the basis on which I am passing sentence. As your Counsel have said, there will be considerable stigma attaching to you both as a result, but I see that as inevitable when offences like these are committed by those in positions of responsibility and trust: you Mr Tu’ivai as a legal counsel, and you Hon Veikune as Speaker of the Legislative Assembly. However I also take into account that you are each likely to lose part or all of your livelihoods: Mr Tu’ivai’s future as a legal counsel is bound to be under consideration; and Hon Veikune has already lost his position as Speaker of the Legislative Assembly and a Nobles’ Representative and may well be deprived of his noble title and estates.

I also take into account that you will lose the 600 cartons of Bounty rum worth $85,200, which will be forfeited under section 210(1), and the Government may benefit from that.

I wish to add that I have known you both in connection with my work for several years now, so this comes as a shock and it is a sad day for me having to pass sentence on you both for such serious offences. But, like the Jury, I also took an oath when I became Chief Justice, to perform “truly and with impartiality my duties as a judge in accordance with the Constitution and the Laws of the Kingdom” and I must honour that oath, put aside acquaintance, and act impartially in passing sentence.

Mr Tu’ivai

I have carefully considered the submissions by Mr Edwards on your behalf, but I have to say that I believe that you played an organisational role in these offences and probably the leading role; and I think you knew exactly what you were doing.

I accept that as a result of this incident your life is at the moment in a mess and that you may not be in a financially strong position, although you have at least 2 properties in New Zealand.

In this case the maximum penalty in terms of section 210(1) is $1,155,600 (ie the duty sought to be evaded of around $300,000 plus the value of the goods of $85,200, as indicated in Exhibit 22 signed by you both, which is a total of $385,200, multiplied by 3). But the maximum penalty - like a maximum sentence of imprisonment - should be reserved for the most serious instances of the offence reasonably likely to occur in practice. While this offence is very serious, it is not the most serious likely to occur in practice.

I consider that the penalty appropriate to the gravity of the offence in Tonga would be between $50,000 to $100,000. Going on then to consider whether that appropriate penalty of $50-100,00 should be reduced on account of any personal mitigation available to you, leaving aside for the moment the question of your means, I really cannot see any personal mitigation which would reduce it to lower than $50,000, even considering all the submissions in your favour by Mr Edwards. That is the penalty to be imposed if you have the means to pay it.

Turning to consider your means, these are obviously not extensive in terms of income, though you obviously have assets here in Tonga and elsewhere; and you may be able to continue your handicraft business. Of course, a penalty is meant to hurt, but I believe you may reasonably be expected to dispose of some assets such as your properties in New Zealand to pay it if I give you a year to do so. It is a principle of imposing a monetary penalty that it must be within the capacity of the offender to pay, having regard to his earning capacity and existing assets: Encyclopaedia of Current Sentencing Practice J1.2. I shall therefore reduce the penalty to what I believe you can find and afford to pay during one year, which I place at $20,000 to fulfil the purposes of protecting the interests of the public, plus punishment and deterrence. This is in line with the penalty imposed by the Court of Appeal in Fiu in a much less serious case.

I shall allow you one year from today to pay it all, ie by 16 February 2007, and in default of payment of that penalty I shall order a period of imprisonment of 1 year. If you wish to pay the penalty by instalments you are free to do so, but I think it is unnecessarily rigid in the circumstances for the Court to stipulate the specific amounts or intervals of instalments.

Hon Veikune

While I have carefully considered the submissions by Mr Tu’utafaiva on your behalf, I regret that I cannot accept that the offence of bribery of which you were found guilty was at the lower end of the scale of gravity. I believe it was at least in the middle of the scale, and probably in the upper half, especially as it took place in relation to the attempted evasion of $300,000 of duty: this was not cartons for personal consumption, but 600 cartons, which can only have been intended for re-sale commercially. If I may add, if you were in the habit of tipping Customs officers “to minimise legal charges”, I believe that too is struck at by section 51, though that may be an example at the lower end of the scale.

While you may not have been the initiator of the offending, you were still a principal actor in it and very much involved, as demonstrated by the bribery offence.

In particular mitigation I take into account the effect of your conviction on your family and extended family, on whom it has unfortunately to be said that you have brought great shame. That is shown by the loss already of your position as Speaker of the Legislative Assembly and a Nobles’ Representative and the prospective loss of your noble title and estates. I accept that in a sense you have been penalised before the Court passes sentence, though that may be an inevitable consequence of your conviction.

In view of the maximum sentence of 3 years’ imprisonment for bribery of a Government servant, I have looked at comparable cases in the UK and Australia. Almost all resulted, after appeal, in prison sentences ranging from 2 months to 2 years, depending on the circumstances. I also noted the remarks by the Court of Appeal in England in R v Ollerenshaw that when a Court is considering imposing a comparatively short period of custody, that is of about 12 months or less, it should generally ask itself, particularly where the offender has not previously been sentenced to custody, whether an even shorter period might be equally effective in protecting the interests of the public, and punishing and deterring the criminal.

Taking these features into account I would have had in mind, in view of your position as a first offender who has already suffered considerably from his conviction, to impose a sentence of 12 months’ imprisonment, suspending all but the first 3 months.

But I have received a medical report on your health from the Physician-in-Charge of Internal Medicine, Dr Sione Talanoa Latu. I regard the terms of that report as confidential, but it is clear that a few years ago you suffered from a heart attack, following which you had a triple coronary bypass and are still now regarded as a high risk patient requiring regular monitoring. In these personal circumstances I do not consider that it would be appropriate to impose either an immediate or a suspended prison sentence in a Tongan prison. The same applies to a community service order, which in any event I would not consider appropriate in the circumstances.

I therefore turn to consideration of imposing a fine, and here I believe it is important to preserve parity with your co-accused Mr Tu’ivai: you were in this unfortunate and misconceived venture together. I shall therefore impose a fine of $20,000 for the count of bribery. While this may seem high for the offence of bribery, I impose it bearing in mind the aspect of parity with your co-accused, that apart from your health I would have imposed a prison sentence, and that I shall stay the conviction for the offence of attempting to evade Customs duty, for which I would otherwise have imposed a similar fine of $20,000.

I regret that under section 27 of the Criminal Offences Act I can only allow you 3 months to pay the fine, ie to 16 May, and if you fail to pay it you shall be imprisoned for 1 year, subject to an up-to-date report on your medical condition. Again, if you wish to pay the penalty by instalments you are free to do so, but I think it is unnecessarily rigid in the circumstances for the Court to stipulate the specific amounts or intervals of instalments.

I set this level of fine in the belief that, despite your reduced income and your current liabilities, you will have the capacity to meet it by disposing of assets such as vehicles or property.

As mentioned, to avoid double jeopardy, in terms of the Court of Appeal’s approach in Vakameitangake I shall order that the conviction on Count 3 is stayed to prevent an injustice to you.

Sentence

‘AMINI TU’IVAI, THE COURT THEREFORE SENTENCES YOU ON COUNT 3 TO A PENALTY OF $20,000, PAYABLE BY 16 FEBRUARY 2007; AND IN DEFAULT OF PAYMENT OF THE WHOLE AMOUNT, TO A TERM OF IMPRISONMENT OF 1 YEAR.

HON VEIKUNE, THE COURT THEREFORE SENTENCES YOU ON COUNT 1 TO A FINE OF $20,000, PAYABLE BY 16 MAY 2006; AND IN DEFAULT OF PAYMENT OF THE WHOLE AMOUNT, TO A TERM OF IMPRISONMENT OF 1 YEAR, SUBJECT TO AN UP-TO-DATE REPORT ON YOUR MEDICAL FITNESS; AND THE COURT STAYS EXECUTION ON COUNT 3.

Forfeiture

Under section 210(1) of the Customs and Excise Act I order that the 600 cartons of Bounty rum in respect of which both Counts 3 were committed shall be forfeited; and shall be disposed of as the Chief Commissioner may direct in terms of section 217(2).

R M Webster MBE
Chief Justice

16 February 2006