Hmm, in general i would say that an exception is an "exception". Hence
you should not use exceptions when the outcome is considered "normal". If a record does not already exist when creating a new one it is expected and therefore no exception should be thrown. In your case the method throws an exception either way which I would consider bad practice as there is no 'expected' behaviour.
Definitions from Sun:
"An exception is an event that occurs during the execution of a program that disrupts the normal flow of instructions."
"The
Java programming language uses exceptions to handle errors and other exceptional events."
After all, the same people are going to grade that method of yours so I would recommend not to expect an exception.