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Road User Charges Bill (Consistent) (Sections 5, 14, 21, 25(c)) [2010] NZBORARp 90 (16 November 2010)

Last Updated: 27 May 2020

Road User Charges Bill

16 November 2010

ATTORNEY-GENERAL LEGAL ADVICE

CONSISTENCY WITH THE NEW ZEALAND BILL OF RIGHTS ACT 1990: ROAD USER CHARGES BILL

1. We have considered whether the Road User Charges Bill (PCO 14656/4.4) (“the Bill”) is consistent with the New Zealand Bill of Rights Act 1990 (“Bill of Rights Act”). We understand that the Bill is likely to be considered by the Cabinet Legislation Committee (“LEG”) at its meeting on Thursday, 18 November 2010. We understand that minor changes could be made to the Bill prior to its consideration by LEG. We will advise you should these changes have any Bill of Rights implications.

2. We have concluded that the Bill appears to be consistent with the Bill of Rights Act. In reaching that conclusion we have considered possible inconsistencies with s 14 (freedom of expression), s 21 (unreasonable search and seizure) and s 25(c) (right to be presumed innocent) of that Act.

PURPOSE

3. The Bill seeks to continue the road user charges (“RUC”) system by imposing charges on heavy vehicles and certain other vehicles for their use of the roads in proportion to the costs that they generate. It aims to modernise and simplify the road user charges system,

improve compliance with and the recovery of road user charges, establish a framework for the electronic management of road user charges, and give effect to the Government’s decisions arising from recommendations of the Independent Review of the New Zealand Road User Charging System.

ISSUES OF INCONSISTENCY WITH THE BILL OF RIGHTS ACT Freedom of Expression

4. Section 14 of the Bill of Rights Act affirms the right to freedom of expression, which includes the freedom to seek, receive, and impart information and opinions of any kind and in any form. The right has been interpreted as including the right not to be compelled to say certain things or to provide certain information. [1]

5. Taking into account the various domestic and overseas judicial pronouncements on the issue, we adopt a two-step inquiry to determine whether an individual’s freedom of expression has been infringed. The first step involves a determination of whether a particular activity falls within the freedom of expression. The second step is to determine whether the purpose or effect of the proposed government action is to restrict that freedom. [2]

Application of Section 14 to the Bill

6. The Bill introduces a regulatory framework for electronic management systems. The Bill also focuses on compliance management and so contains an assessment system. To this end, cl

38(1) requires an electronic systems provider to report a matter to the RUC collector where the electronic systems provider knows, or has reasonable grounds to suspect that any electronic system appears to be tampered with. Clauses 38(3) and (4) also require the electronic systems provider not disclose this information to any other person. Clause 39 also requires an electronic systems provider to disclose any road user charges information to a RUC collector that may be required for issuing an assessment for unpaid RUC under cl 47.

7. Clause 58 requires that certain persons make and retain records regarding the use and maintenance of each RUC vehicle that the person owns or operates. The objective of cl 58 is to ensure that there are records available for the purpose of monitoring compliance with the Bill.

8. Under cl 40, a person is liable to a penalty not exceeding $15,000 in the case of an individual and $75,000 in the case of a body corporate for failure to comply with cl 38(1) or knowingly providing false or misleading information. A failure to comply with cl 58 is an offence and could lead to a fine not exceeding $25,000 in the case of an individual, or $100,000 in the case of a body corporate (cl 58(6)). The imposition of a penalty creates a clear element of compulsion and restriction on the freedom in s 14 of the Bill of Rights Act.

9. Despite this element of compulsion, it is arguable whether any of the disclosure or record- keeping requirements in the Bill amount to compelled “expression” for the purposes of s 14. This is because electronic systems providers are, for the most part, not required to express opinions or ideas but simply to provide factual information relating to road user charges.

10. Clause 38 however, requires the disclosure of information where there are reasonable grounds to believe that an electronic system has been tampered with. The electronic systems provider may therefore provide information based on a suspicion or opinion. This information could therefore contain expressive content. Clause 39 provides for the disclosure of any road user charges information. This information includes but is not limited to the identity and business address of a person who has purchased a RUC vehicle, the distance travelled by a RUC vehicle and the location of a RUC vehicle for the purposes of verifying a refund application for off-road travel. As the RUC information required is not limited, this could arguably be expressive. In light of the breadth of this information and for completeness, we have considered whether a limit on s 14 would be justified under s 5 of the Bill of Rights.

11. Where a provision is found to limit a particular right or freedom, it may nevertheless be consistent with the Bill of Rights Act if it can be considered a reasonable limit that is justifiable in terms of s 5 of that Act. Following the guidance of the New Zealand Supreme Court decision of Hansen v R, the s 5 inquiry may be summarised as: [3]

a. does the objective serve a purpose sufficiently important to justify some limitation of the right or freedom?

b. If so, then:

i. is the limit rationally connected with the objective?

ii. does the limit impair the right or freedom no more than is reasonably necessary for sufficient achievement of the objective?

iii. is the limit in due proportion to the importance of the objective?

12. The transport sector is highly regulated in order to provide transparency and accountability.

Road user charges are specifically regulated as evasion results in the government losing revenue and compliant road users subsidising those who do not pay. Enforcing compliance with the regulatory regime is a significant and important objective.

13. The disclosure of relevant information by electronic system providers is designed to provide a RUC collector with the information for the purposes of issuing an assessment under cl 47. The requirement for transport service operators to create and maintain records is also a

measure designed to promote a well managed system. Accordingly, we consider that the provisions of the Bill that create a limit on freedom of expression are rationally linked to the objective.

14. The compelled information in both cl 39 and 58 is likely to be purely factual information

which relates to road user charges. Disclosure in cl 39 is also only required if a person has failed to produce records or other information under cl 61(1), or the RUC collector has reasonable grounds to believe that the records or documents produced are false, inaccurate, or misleading. There are also duties relating to the management of road user charges information by electronic system providers in Schedule 1 and cl 58(3) states that records in cl 58 cannot be used as evidence in a prosecution for a work time or logbook offence under the Land Transport Act 1998. The limit therefore does not impair the right in s 14 more than is reasonably necessary for sufficient achievement of the objective.

15. The information required is of a type that people can reasonably be expected to provide in this regulatory context. We therefore consider that the limits placed on the right to

freedom of expression appear to be in due proportion to the importance of those objectives and are therefore justified under s 5 of the Bill of Rights Act.

Unreasonable search and seizure

16. Section 21 of the Bill of Rights Act affirms the right to be secure against unreasonable search or seizure, whether of the person, property, correspondence or otherwise. There are two limbs to the s 21 right. First, whether activities constitute a “search or seizure” and second, where certain actions do constitute a search or seizure, whether the search or seizure is “unreasonable” in the circumstances.

17. A request for information or documents constitutes a search for the purposes of s 21 of the

Bill of Rights Act. [4]

18. Clauses 34 and 59 require the applicant to produce for inspection any documents or other information in the person’s control and allow the chief executive to take extracts from, make copies of, or retain any of these documents or other information. The purpose of these clauses is to gain the information to verify an application for a refund or waiver, or an assessment for unpaid road user charges. Here the applications are initiated by the persons themselves and the applicant is in the best position to identify the relevant supporting information. Where information is copied or retained, cl 34(3) provides that documents will be returned to the applicant as soon as practicable.

19. Where an application for a refund is based wholly or in part on an alleged hubodometer failure, cl 35(1)(c) allows the chief executive to require the operator of the RUC vehicle to produce the hubodometer for inspection and retain the hubodometer until a decision has been made. No refund may be given if the hubodometer cannot be produced on demand. The purpose of the search is to verify the alleged failure.

20. Under cl 56 the chief executive may take information from the engine management system relating to distance travelled by a specific vehicle. The objective of cl 56 is to gather information for the purposes of issuing an assessment for unpaid road user charges under cl

47. The information is limited to information from the engine management system relating

to the distance travelled by the vehicle. This information is factual information that is connected to cl 47.

21. Clause 59 requires information to be produced for the purpose of conducting an inquiry, making an assessment, or otherwise ascertaining whether liable persons have complied with the Act. The information required is limited to that which is relevant to the use and maintenance of a RUC vehicle. Where any record or other information has been retained cl

59(3)(a) provides that this material be returned as soon as practicable.

22. Clause 60(2) allows the chief executive to request from any person who has serviced, maintained, supplied or contracted for the RUC vehicle, access to a person’s business records. These requests are limited to the purpose of verifying records or other information produced in cl 59(1) or otherwise ascertaining whether the provisions of the Act have been or are being complied with or establishing the RUC vehicle’s use and maintenance history.

23. Clause 71 gives the Court the power to issue a warrant under s 198 of the Summary

Proceedings Act 1957 in respect of an alleged offence. Clause 71(2) extends the Courts power to issue a warrant even though the offence is not punishable by imprisonment. Despite the extension of powers, the procedural safeguards in the Summary Proceedings Act still apply.

24. We have concluded that although these clauses constitute a search under s 21 of the Bill of Rights, the search is not “unreasonable” as it is rationally linked to the objective and does not go further than is necessary in each instance.

Seizure of hubodometer and licence

25. Both cls 44 and 45 give the power to seize and retain a hubodometer and a licence carried on a RUC vehicle. Under cl 44, the enforcement officer may remove and retain these items for the purposes of any criminal proceedings. This power is not subject to a search warrant. Normally, search and seizure in the criminal context would require a warrant. However under s 113 of the Land Transport Act 1998, an enforcement officer in uniform or in possession of a warrant or other evidence of his or her authority as an enforcement officer may enforce the provisions of the Road User Charges Act.

26. The purpose of cl 45 is to enable the chief executive to determine whether an assessment for unpaid road user charges is needed. Search warrants are generally not needed if the primary purpose of the inspection or search is to monitor for compliance with a regulatory regime.

27. Both clauses contain safeguards as the power to seize and retain is limited to where there are reasonable grounds to suspect the circumstances outlined in cl 44(1) and cl 45(a). The hubodometer is also located on the outside axle hub of the vehicle and the licence is on the windscreen of the vehicle. Consequently, this is less of an intrusion into a person’s expectation of privacy than a power of entry. [5]

28. We have concluded that although these clauses constitute a search under s 21 of the Bill of

Rights, for the above reasons the search powers are not “unreasonable”.

Right to be presumed innocent

29. Section 25(c) of the Bill of Rights Act affirms the right to be presumed innocent until proved guilty. This means that an individual must not be convicted where reasonable doubt as to his or her guilt exists. The prosecution in criminal proceedings must therefore prove, beyond reasonable doubt, that the accused is guilty.

30. Reverse onus defences give rise to an issue of inconsistency with s 25(c) because the accused is required to prove (on the balance of probabilities) a defence to escape liability. Where an accused is unable to prove the defence, then he or she could be convicted even though reasonable doubt exists as to his or her guilt. In other criminal proceedings an accused must merely raise a defence in an effort to create reasonable doubt.

31. Clause 70 limits the right to be presumed innocent as it requires the defendant to prove a defence to a charge of operating a RUC vehicle when the distance licence carried or displayed is for the wrong vehicle type, or operating a RUC vehicle without a properly working distance recorder. Clauses 40(1)(a) and 60(4) create strict liability offences as the

defendant commits an offence unless they can prove that they had a reasonable excuse for failing to provide information in cl 38(1) or 60(1).

Is the limit on the right to be presumed innocent justified?

32. We have therefore considered whether the relevant clauses are justifiable under s 5 of the Bill of Rights Act. One of the purposes of the Bill is to enhance compliance management and so encourage users to pay on time and give the authorities effective measures to investigate and recover outstanding revenue. We consider this to be a significant and important objective.

33. The provisions in question place the onus on defendants to explain why they have not complied with their obligations in relation to the taxation of diesel vehicles for roading purposes. In each case the provisions increase the likelihood of successful enforcement action to promote the objectives of the Act because they do not require the Police to prove elements of the offence that are peculiarly within the realm of the defendant. [6] The limit on the right to be presumed innocent is therefore rationally linked to the objective.

34. In assessing whether the limitation is proportionate to the objective we note that the elements in cls 40, 60(4), 70(1)(a)-(d) and 70(3) will be significantly less onerous for the defendant to prove than the Police. This is especially so for cl 70(1)(c) which requires the defendant to prove that the lifting axle fitted to the vehicle was capable of being altered by the fitted device so as to transmit to the roadway a portion of the liable motor weight of the RUC vehicle. Here it would be very difficult for the Police to prove as it involves the operation of specialist equipment fitted to the vehicle which the owner or operator has knowledge of rather than the Police. It is apparent that in cl 70(3) the defendant will also be in the best place to provide the evidence as the defendant can show receipts or other evidence which can prove that a distance recorder was fitted to the vehicle or fitted soon after the alleged offence, and it will be within the defendant’s realm of knowledge why it was not possible for one to be fitted or repaired during the period it was not operational. Furthermore, the offences relate to a public welfare regulatory regime rather than truly criminal behaviour and the penalty for breach is at the lower end of the scale.

35. For these reasons, we consider that the reverse onus defences of the Bill appear to impair the right to be presumed innocent no more than is reasonably necessary for sufficient achievement of the objective and the limit is in due proportion to the importance of that objective.

Conclusion

36. We have concluded that the Bill appears to be consistent with the rights and freedoms affirmed by the Bill of Rights Act. This advice has been prepared by the Public Law Group and the Office of Legal Counsel.

Jeff Orr

Chief Legal Counsel

Office of Legal Counsel

Footnotes:

1. RJR MacDonald v Attorney-General of Canada (1995) 127 DLR (4th) 1.

2. Ross v New Brunswick School District No 15 [1996] 1 SCR 825.

3. The proportionality test under s 5 of the Bill of Rights Act, as applied in Hansen v R [2007] NZSC 7 [123], draws on the test articulated by the Canadian Supreme Court in R v Oakes [1986] 1 SCR 103, R v Edwards Books and Art Ltd [1986] 2 SCR 713 and R v Chaulk [1990] 3

SCR 1303. See for example, Hansen, at [42] per Elias CJ; [64] and [79] per Blanchard J; [103], [104] and [120]-[138] per Tipping J; [185] and [217] per McGrath J; and [272] per Anderson J.

4. New Zealand Stock Exchange v Commissioner of Inland Revenue [1992] 3 NZLR 1 (PC).

5. New Zealand Stock Exchange v Commissioner of Inland Revenue [1992] 3 NZLR 1 (PC); see also McKinlay Transport Ltd v R (1990) 68 DLR (4th) 568 (SCC); and Thomson Newspapers v Canada 1990 CanLII 135 (SCC); [1990] 1 SCR 425.

6. Common to all the reverse onus provisions is that the reasonable excuse may only be known to the person concerned: See, for example, Sheldrake v Director of Public Prosecutions [2004] UKHL 43; [2005] 1, AC 264.

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 Road User Charges 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.


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