Home | Databases | WorldLII | Search | Feedback New Zealand Bill of Rights Act Reports

Motor Vehicle Sales Amendment Bill (Consistent) (Sections 5, 9, 25(c)) [2009] NZBORARp 26 (7 May 2009)

Last Updated: 28 April 2020

MOTOR VEHICLE SALES AMENDMENT BILL

7 May 2009

Attorney-General

LEGAL ADVICE

CONSISTENCY WITH THE NEW ZEALAND BILL OF RIGHTS ACT 1990: MOTOR VEHICLE SALES AMENDMENT BILL

1. We have considered whether the Motor Vehicle Sales Amendment Bill (PCO 13164/7.0) (the “Bill”) is consistent with the New Zealand Bill of Rights Act 1990 (“Bill of Rights Act”). We understand the Bill is likely to be considered by the Cabinet Legislation Committee on Thursday, 14 May 2009. The Bill amends the Motor Vehicle Sales Act 2003 (the “Act”) to improve its operation. The Bill purports to:

• clarify the particulars that must be displayed regarding used motor vehicles,

• add a requirement to notify the registrar when a new person becomes involved in the management of a motor vehicle trader,

• extend the ambit of the current provision that bans certain people who engage in certain activities or offences from being motor vehicle traders, to include persons who have been motor vehicle traders within the previous 5 years,

• make it an offence to knowingly provide false material to the Registrar.

2. We conclude that the Bill does not appear to be inconsistent with the rights and freedoms affirmed in the Bill of Rights Act. In reaching this conclusion we have considered potential issues of inconsistency with sections 9 and 25(c).

ISSUES OF POTENTIAL INCONSISTENCY WITH THE BILL OF RIGHTS ACT

Section 9 of the Bill of Rights Act: the right to freedom from disproportionately severe punishment

3. Clause 19 of the Bill makes it an offence to provide false declarations, certificates or information to the Registrar of motor vehicle traders in the context of applying for, renewing or notifying relevant changes to a motor vehicle trader registration.

4. The penalty for this offence, prescribed in section 118 of the Act, is $50,000 for an individual and $200,000 for a body corporate.

5. We have considered whether this clause is a prima facie breach of section 9 of the Bill of Rights Act, which protects the right not to be subjected to disproportionately severe punishment. We note that the penalty is high for an offence which we consider is regulatory in nature. We further note that, while other sections in the Motor Vehicle Sales Act and the Bill provide levels of fines not exceeding $2000, and between $20,000 and $40,000, respectively, the proposed new offence falls under the heaviest financial penalties in the Motor Vehicle Sales Act.

6. In addition, section 68(1) of the Motor Vehicles Sales Act lists persons who are banned from the business of trading motor vehicles. Section 68(2) prescribes that bans have effect for a period of 5 years starting on and from the date of the conviction, failure or matter, as the case may be, for which the ban is imposed. If a ban is issued concurrent with a fine, the effect may be severe.

7. The Court of Appeal in Puli'uvea v Removal Review Authority held that the right not to be subjected to disproportionately severe treatment under section 9 of the Bill of Rights Act is not triggered unless the treatment is "so excessive as to outrage standards of decency." [1]

8. In light of this ruling we consider that the penalty for this offence is not “excessive” and

therefore does not breach section 9. In making this assessment we noted that:

• the offence does not attract a prison sentence,

• the penalty is not at the highest end of the legislative spectrum,

• the penalty is sufficiently high to serve a deterrent function and is at a level where it cannot

be written off as a business expense,

• the licensing regime to which the new offence relates is at the heart of the motor vehicle trading regime, hence the need for a higher penalty, and
• the specified penalty is a maximum fine level the exercise of which is at the discretion of a court.
  

Section 25(c) of the Bill of Rights Act: the right to be presumed innocent until proven guilty

9. Section 25(c) provides that everyone who is charged with an offence has, in relation to the determination of the charge, the right to be presumed innocent until proved guilty according to law. This means that an individual must not be convicted where reasonable doubt as to her or his guilt exists. Therefore, the prosecution in criminal proceedings must prove, beyond reasonable doubt, that the defendant is guilty.

10. Strict liability offences give rise to an issue of inconsistency with section 25(c) because the accused is required to prove (on the balance of probabilities) a defence; whereas, in other criminal proceedings an accused must merely raise a defence in an effort to create reasonable doubt. This means, where an accused is unable to prove the defence, that she or he could be convicted even though reasonable doubt exists as to his or her guilt.

11. Clause 18 of the Bill amends section 102 of the Act to provide that a car market operator commits an offence if they fail to take “reasonable steps” to ensure a motor vehicle dealer (who sells vehicles through the car market operator) complies with her or his obligations under the principal Act. Clause 20 of the Bill, new section 108A of the Act, creates an

offence for a motor vehicle trader that is a company, to fail “without reasonable excuse” to notify the registrar when a new person becomes involved in the management of the company. Because a defendant must prove the reason for their failure to comply, these sections create strict liability offences, which reverse the onus of proof back onto the defendant.

12. We have concluded that the offences in clauses 18 and 20 appear to be justifiable under section 5 of the Bill of Rights Act. First, the offences can be described as regulatory in nature rather than "truly criminal" offences and as such are not considered to be of the same severity [2]. Further, those who choose to participate in regulated or licensed industries should be expected to meet certain expectations of care and accept the enhanced standards of behaviour required of them [3].

13. Secondly, these clauses serve a significant and important objective, which is to bolster support for the integrity of the motor vehicle trade, and consumer confidence in the business of motor vehicle trading.

14. Thirdly, reverse onus offences can be justifiable where the offence turns on a particular matter that is peculiarly within the knowledge of the defendant. With the above clauses, the defendant is best placed to know why they have not complied with the requirements of the relevant offences. It is more appropriate for the defendant to provide this information than to require the Crown to prove the opposite.

15. Finally, we note as a general principle, strict liability offences should carry penalties at the lower end of the scale. The penalty for breaches of clauses 18 and 20 is set out in section 116 of the principal Act as a fine not exceeding $2000 and is a lower level penalty.

16. For the foregoing reasons, we have concluded that the Bill appears to be consistent with the rights and freedoms affirmed in the Bill of Rights Act.

Jeff Orr

Chief Legal Counsel

Helen Wyn
General Manager

Office of Legal Counsel Public Law

Footnotes

1 (1996) 2 HRNZ 510 per Keith J. His Honour referred to the case of R v P (1993) 10 CRNZ

250, 255, which cited decisions of the Supreme Court of Canada and the United States

Supreme Court.

2 R v City of Sault Ste Marie (1978) 85 DLR (3d) 161 discusses the nature of public welfare offences

3 R v Wholesale Travel Group (1992) 84 DLR (4th) at 213

In addition to the general disclaimer for all documents on this website, please note the following: This advice was prepared to assist the Attorney-General to determine whether a

report should be made to Parliament under s 7 of the New Zealand Bill of Rights Act 1990 in relation to the Motor Vehicle Sales Amendment Bill. It should not be used or acted upon for any other purpose. The advice does no more than assess whether the Bill complies with the minimum guarantees contained in the New Zealand Bill of Rights Act. The release of this advice should not be taken to indicate that the Attorney-General agrees with all aspects of it, nor does its release constitute a general waiver of legal professional privilege in respect

of this or any other matter. Whilst care has been taken to ensure that this document is an accurate reproduction of the advice provided to the Attorney-General, neither the Ministry of Justice nor the Crown Law Office accepts any liability for any errors or omissions.