Chapter 7
Standard of proof

Retention of the civil standard of proof

7.6The Commission recommends that pecuniary penalties should continue to be imposed on the civil standard of proof, or in other words, on the balance of probabilities. It does not favour the adoption of the criminal standard of proof. The argument in favour of moving to the criminal standard focuses on the nature of pecuniary penalties as a grave, state-imposed sanction that serves much the same ends as a criminal penalty. The argument continues that courts should not impose a pecuniary penalty without a high degree of confidence that the defendant has committed the breach, and that society has the same interest in ensuring that it does not penalise the innocent as it does with criminal offences. We have some sympathy for this argument but, on balance, we disagree.

7.7Criminal cases demand that proof beyond reasonable doubt is established because of the very grave consequences of criminal conviction. Those are:121

… its substantial stigmatizing effect, the possibility of imprisonment, and the fact that it serves not merely to impose costs on the defendant but also to express the condemnation of the community.

7.8A reading of this quote, alongside the discussion in Chapter 4 of this Report, will indicate that the position is finely balanced. As noted in that chapter, it is possible that pecuniary penalties may sometimes have as stigmatising an effect as some criminal convictions, and they also exist not merely to impose costs on the defendant but also to express the condemnation of the community. However, criminal conviction remains the gravest penalty available, and the criminal trial is unique in that it can, in many cases, result in the deprivation of liberty. Because of these consequences the need is heightened to ensure that only the guilty should be found guilty and punished, even at the cost of some wrongful acquittals. The fact that the risk of conviction and incarceration does not arise with pecuniary penalties supports a view that the application of the civil standard of proof is justifiable.

7.9A number of submitters voiced concerns about the practical impact that a shift to the criminal standard for pecuniary penalties would have. There was concern that it would undermine the statutory regimes where pecuniary penalties usually feature by inhibiting regulators from using them in the manner intended: to act as a tool that fills an existing gap between criminal offences and lesser forms of penalty or intervention. If a criminal standard were imposed, it would be difficult to see what role pecuniary penalties would play in the regulatory environment.

7.10One submitter suggested that policymakers might revert to using criminal offence provisions, including strict liability offences, and increasing criminal fines, thereby broadening the field of criminal liability more than would otherwise be required.122 If correct, a proliferation of criminal offences could result for conduct that does not deserve the disapprobation of the criminal law, or it could lead to the proliferation of offences that are difficult to prove and therefore rarely, if ever, prosecuted.

7.11Another practical concern is that some regimes align orders for compensation, injunctions and management bans with a finding of liability for a pecuniary penalty. The practical benefits offered by this approach might be lost if pecuniary penalties were to be proved to a higher standard.

7.12Retaining the civil standard of proof is also supported by the way that New Zealand courts have applied that standard, as described by the Supreme Court majority in Z v Dental Complaints Assessment Committee.123 The majority rejected the application of the higher standard of proof in disciplinary cases. In that case, the consequences for the defendant dentist were very grave indeed. He had previously been charged with three counts of indecent assault on patients, two of which involved administering a sedative at higher levels than recommended. The dentist was found not guilty of all the criminal charges, but sought judicial review of a subsequent disciplinary decision of the Dental Complaints Assessment Committee. The question on appeal to the Supreme Court was whether the criminal standard of proof should apply to the disciplinary proceedings. The majority concluded that it should not.124 It noted the wide range of conduct that may be the subject of disciplinary proceedings, including professional inadequacy at one end, and serious criminality at the other. It concluded that the universal application of the criminal standard to all disciplinary proceedings would be overly rigid.125
7.13To cater for this range of conduct, the majority noted that an alternative approach could be for a court to exercise discretion as to when and when not to require the criminal standard, but only for the most serious of allegations. However, it also noted the difficulty that there was little guidance on when it would be appropriate to require the criminal standard.126
7.14The other factor that weighed in favour of retaining the civil standard was the “long-established” and “sound in principle” approach to it taken by the courts, which requires that serious allegations must always be proved by evidence having sufficient probative force.127 Although referring to this as the “flexible application of the civil standard of proof”, McGrath J for the majority clarified the approach as follows:128

… it is not the position that flexibility is “built into” the civil standard, thereby requiring greater satisfaction in some cases. Rather, the quality of the evidence required to meet that fixed standard may differ in cogency, depending on what is at stake.

7.15The majority considered that in disciplinary proceedings this approach gave proper protection to the person subject to the process, who would face penalties and stigma if found guilty of misconduct.

7.16Not all of the arguments relied upon in Z v Dental Complaints Assessment Committee carry the same weight in relation to pecuniary penalties. The statutory purpose of pecuniary penalties differs from disciplinary hearings. The latter, as the majority found, have as their purpose public protection. Pecuniary penalties aim to protect the public too, but their emphasis is more markedly on deterrence by way of substantial penalty. They have more in common with criminal proceedings than disciplinary proceedings in this respect.

7.17However, pecuniary penalties do share some of the features referred to by the Supreme Court. They too target a wide range of technical and more substantial breaches of the law. In the former cases, it would be expected that the penalty would be considerably lower. Importantly, they also carry the benefit for the defendant that they avoid the imposition of a criminal conviction. Therefore, in our view the civil standard of proof is appropriate in principle. New Zealand courts’ approach to its application reinforces this view.

121B Underwood “The Thumb on the Scales of Justice, Burdens of Persuasion in Criminal Cases” (1977) 86 Yale LJ 1299 at 1339, quoted in
J November Burdens and Standards of Proof in Criminal Cases (Butterworths, Wellington, 2001) at 8.
122Meredith Connell.
123Z v Dental Complaints Assessment Committee, above n 117.
124Elias CJ dissented, preferring the application of the criminal standard.
125Z v Dental Complaints Assessment Committee, above n 117, at [113].
126At [114].
127At [112].
128At [101].