Brancatella v The Queen
[2016] VSCA 94
•6 May 2016
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCR 2016 0039
| ANTHONY VITO BRANCATELLA | Applicant |
| v | |
| THE QUEEN | Respondent |
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| JUDGES: | WEINBERG AP and COGHLAN JA | |
| WHERE HELD: | MELBOURNE | |
| DATE OF HEARING: | 4 May 2016 | |
| DATE OF JUDGMENT: | 6 May 2016 | |
| MEDIUM NEUTRAL CITATION: | [2016] VSCA 94 | 1st Revision 13 July 2016; para [2] Table |
| JUDGMENT APPEALED FROM: | DPP v Brancatella (Unreported, County Court of Victoria, Judge Douglas, 10 February 2016) | |
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CRIMINAL LAW – Sentence – Application for leave to appeal – Applicant convicted of 62 charges of wrongful conversion and false accounts pursuant to ss 91(1)(a)(i) and 91(1)(a)(ii) of the Estate Agents Act 1980 – Total effective sentence three years and four months’ imprisonment with non-parole period of 20 months – Applicant maintained he intended to repay funds taken – 62 separate victims – Offending involved using trust monies received from clients - General deterrence, punishment and denunciation important sentencing considerations – Sentence not manifestly excessive – Application for leave to appeal refused
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| APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr R Melasecca | Melasecca Kelly & Zayler |
| For the Crown | Mr C B Boyce SC | Mr J Cain, Solicitor for Public Prosecutions |
WEINBERG AP:
I agree with Coghlan JA.
COGHLAN JA:
On 1 February 2016 the applicant pleaded guilty in the County Court at Melbourne to 62 separate offences under the Estate Agents Act 1980. On 10 February 2016 he was sentenced as set out below:
Charge on
IndictmentOffence Maximum Sentence Cumulation 1. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 2. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 3.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 4.
Estate Agent – Convert Money for Own Use [s 1(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 5.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 6.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months 7.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months
Charge on
Indictment
Offence Maximum Sentence Cumulation 8.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months 9.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 10.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 11.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 2 months 12.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 13.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 14.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 15.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 1 month 16.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 17.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 18.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 15 months 3 months 19.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months Charge on
Indictment
Offence Maximum Sentence Cumulation 20.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 21.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 22.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months 23.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 24.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 2 months 25. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 26.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months 27.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 28.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 29.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 2 months 30.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months 31.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months
Charge on
Indictment
Offence Maximum Sentence Cumulation 32.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 33.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 34.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 35.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 36. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 37.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months 38.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 39.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 40.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 41.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 15 months 3 months 42. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months
Charge on
Indictment
Offence Maximum Sentence Cumulation 43.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 44.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 2 months 45.
Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 46.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 15 months Base 47.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 48.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 2 months 49.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 50. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 51. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 52.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 53. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 2 months
Charge on
Indictment
Offence Maximum Sentence Cumulation 54.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 15 months 3 months 55.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 56.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 57. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years
[s 91(1) Estate Agents
Act 1980]10 months 58.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 10 months 59.
Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 60. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 15 months 3 months 61. Fraudulently Convert Any Moneys Received [s 91(1)(a)(i) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 8 months 62. Estate Agent – Convert Money for Own Use [s 91(1)(a)(ii) Estate Agents Act 1980] 10 years [s 91(1) Estate Agents Act 1980] 15 months 3 months Total Effective Sentence: 3 years 4 months Non-Parole Period: 20 months Pre-Sentence detention declaration pursuant to s 18(1) of the Sentencing Act 1991: 8 days 6AAA Statement: No declaration made
Other relevant orders: NIL
By Notice of Appeal dated 16 March 2016 the applicant seeks leave to appeal against sentence on the following grounds:
Ground 1:
The Minimum term imposed by the Learned Sentencing Judge was excessive having regards to the Judge’s findings in respect of there being no need to specifically deter the Applicant.
Ground 2:
The sentence imposed by the Learned Sentencing Judge was manifestly excessive especially having regards to:
i)The Learned sentencing Judge having given insufficient weight to the co-operation of the Applicant with authorities, his plea of guilty, and the Applicant’s remorse.
ii)The Learned Sentencing Judge having given undue weight to the principles of general deterrence, having regards to the Applicant’s consistent desire that there be no victims in this matter.
iii)The Learned Sentencing Judge erred in not sentencing the applicant to a community correction order having regards to his lack of prior offending, his attitude to the victim and the significant efforts made to compensate all parties.
At the hearing before this Court, Mr Melasecca accepted that Ground 1 was not arguable and abandoned that ground. He did, however, rely upon the material submitted in support of that ground as part of his argument in relation to Ground 2.
It follows that the applicant can only succeed if he can show that the sentence imposed by the sentencing judge was wholly outside the range of sentences reasonably available to her Honour.
The offending
In 2012 the applicant purchased a real estate business which operated under the name McDonald Real Estate Pty Ltd (‘MCDRE’). The applicant and his mother, Rosetta, were the directors.
The applicant’s mother was guarantor for the loan taken out to buy the business. For all practical purposes the applicant ran the entire operation.
The business was split into two divisions. One involved the sale of properties and the other the management of rental properties. Shortly after the applicant took over the business he found that the rental part was unprofitable and that created financial stress on the business as a whole.
In relation to the sale of properties part of the business, funds received on behalf of clients had to be held on trust. The business had a trust account for that purpose called the ‘Sales Trust Account’.
On 50 occasions between 11 December 2013 and 19 June 2014 the applicant instructed an employee to prepare a trust cheque payable to a vendor, or a prospective purchaser whose deposit needed to be returned. The applicant altered the name of the payee to either ‘Cash’ or ‘MCDRE’. The cheques were then either cashed or paid into the office account, or used to pay credit card accounts in the applicant’s name or that of his mother. That was the conduct involved in charges 1–40, 42–45, 50, 51, 53, 57, 60 and 62. Those charges involved a total of $1 477 320.10. In relation to charges 50 and 57 the applicant also prepared false certificates indicating that the vendor had applied for the release of part of the deposit.
On 12 other occasions between 9 April 2014 and 18 June 2014 when the applicant received cheques for the deposit on a sale, he failed to deposit those cheques into the trust account as required. Instead, he deposited the funds into other office accounts. That was the conduct involved in charges 41, 46–49, 52, 54–56, 58, 59 and 61.
On 12 June 2014 Consumer Affairs Victoria (‘CAV’) received a number of complaints about the applicant’s business. When a representative of CAV, Mr Rushford, visited the applicant on that day the applicant denied having taken any money from the trust account, and having placed it in the office account. He also told Mr Rushford that the business was not experiencing any financial difficulties
Later in June the applicant’s solicitor contacted CAV and informed them that their client would cooperate and repay all victims.
Between 12 June 2014 and 7 August 2014, CAV inspectors carried out a total of six inspections of the business. They unearthed the conduct involved in the 62 charges.
On 12 June 2014 the applicant was removed from the business. He was interviewed by way of record of interview on 18 December 2014, and provided a prepared statement dated 8 December 2014. In both the statement and in the record of interview he said he was sorry for what he had done.
There were some subsequent difficulties between CAV and the applicant which are not relevant for present purposes. On 18 March 2015 he was finally charged with these offences and his licence was suspended from that date.
At the time CAV took over the agency almost $900 000 was owing to clients which could not at that stage be accounted for. By September 2015 the applicant had repaid $390 986.70 and the Victorian Property Fund had paid out $507 892.73.
As at the date of the plea the applicant was making arrangements for the money that he had misappropriated to be repaid. He had arranged to be provided with funds by his mother. These funds would otherwise have been part of his inheritance.
It follows that before CAV intervened, almost $1 million which had been fraudulently converted had been paid back to those from whom it had been fraudulently converted. Indeed, the $900 000 outstanding almost certainly represented a series of fraudulent conversions which the applicant had committed in order to repay and/or cover up earlier acts of fraudulent conversion.
It has always been the applicant’s contention that he intended to repay all the funds taken, either by trading out of his difficulties or by selling investment properties
The applicant maintained that if he had not been removed from the agency that is what he could have done. Mr Melasecca was unable to demonstrate to the Court, in any meaningful way, how that could possibly have been achieved. If anything, the pattern of offending seemed to indicate a rising level of desperation.
It was submitted on behalf of the applicant that his offending was of a different moral order from that of those who have simply stolen property and used it to support an extravagant lifestyle.
It may be true that the moral culpability of one who fraudulently converts funds in order to keep a struggling business going is marginally lower than that of a thief who steals solely to promote an affluent lifestyle. If so, the distinction is slight and in most cases illusory. The offences with which the applicant was charged carry the same maximum penalty as do the offences of theft and obtaining property by deception under the provisions of the Crimes Act 1958.
Section 91 of the Estate Agents Act 1980 relevantly provides:
91 Wrongful conversion and false accounts
(1)Without affecting the operation of Division two of Part I of the Crimes Act 1958 any estate agent who—
(a) fraudulently converts to his own use—
(i)any moneys received or held by him on behalf of any person in respect of any transaction in his capacity of estate agent; or
(ii)any moneys so received or held which are held by him as a stakeholder or in trust pending the completion of any transaction—
…
shall be guilty of an indictable offence and be liable, if a corporation, to a penalty of not more than 1000 penalty units or, if any other person, to a penalty of not more than 500 penalty units or, to imprisonment for a term of not more than ten years
Section 91(1)(a)(ii) was applicable to the group of 50 charges described above, and s 91(1)(a)(i) applied to the group of 12 charges described above.
These are more than merely regulatory offences. They involve a person who ‘fraudulently converts to his own use.’ They are dishonest in their nature and reflect a high degree of criminality.
It is not clear, in any event, that the applicant’s conduct would not have amounted to theft had the authorities chosen to deal with the offences in that way.
Mr Melasecca argued on behalf of the applicant that the appropriate disposition for his client was nothing more than a relatively short term of imprisonment followed by a Community Correction Order (‘CCO’). He based that submission on what had been said in Boulton v The Queen[1] about the wide range of criminal conduct which might attract such an order. He accepted, however, that in later cases this Court had made further reference to Boulton qualifying the width that might otherwise have been attributed to the passages upon which he relied.
[1][2014] VSCA 342.
In particular, Mr Melasecca was aware of Dyason v The Queen[2] and Gianallo v The Queen.[3] He sought to distinguish the sentences imposed in those cases from that which he submitted would have been appropriate for the applicant in this case by arguing that the offending in both Dyason and Gianallo was far more serious than that of his client. He submitted that the applicant always thought that he would be able to trade out of his difficulties. That fact, taken with his outstanding previous good character and the efforts that he made to repay the funds, put the applicant in an entirely different position to that of the offenders in those cases.
[2][2015] VSCA 210.
[3][2015] VSCA 205.
Mr Melasecca also sought to distinguish Director of Public Prosecutions v Bulfin[4] on a similar basis. He argued that the applicant should not have been regarded as a suitable vehicle for the full weight to be accorded to general deterrence, given the mitigating factors present in his case.
[4][1998] 4 VR 114 (‘Bulfin’).
The relevance of Bulfin in this case is that the Court of Appeal there emphasised the importance of general deterrence in sentencing white collar offenders. In an often quoted passage, Charles JA said:
Whatever the motivation, offences of the kind here in question almost invariably involve a carefully calculated course of conduct over a long period, repeated deliberate acts of dishonesty, substantial amounts of money, and, frequently, losses (often tragic in their impact) to large numbers of small investors The offender often holds a position making it possible, or has the ability, to disguise or camouflage the conduct in question. Detection is difficult, the investigation of the crime usually lengthy and very expensive, and the problems of trial and proof will frequently be extreme. Many of these matters were discussed by this court, similarly constituted, in R v Kostikidis and Mpehelevanas (unreported, Court of Appeal, 12 September 1996); see also R v Cave (1988) 32 A. Crim. R. 484 per O’Bryan J. at 487. The result of such considerations, in my view, is that the element of general deterrence will usually carry particular significance in sentencing for crimes such as the present, both in relation to the total effective sentence and the non-parole period; together with a requirement for strong denunciation by the sentencing court.[5]
[5]Ibid 132.
In her reasons for sentence, which were carefully expressed, the sentencing judge dealt with all the matters which had been put on the plea and made a number of findings favourable to the applicant. No complaint is made about any of the findings.
There are two particular difficulties with Mr Melasecca’s submission. First, he did not really deal with the question of general deterrence, other than to say that the applicant was in a different position from others for the reasons set out above. That contention failed to recognise that when dealing with offences of this kind, the offenders will often be people of previous good character and will generally have excellent prospects of rehabilitation.
Second, he did not deal with the proposition that this was not a simple breach of trust such as an employee taking from an employer. This case involved the applicant taking clients’ money, which was in trust, or should have been, and using it for his own purposes.
The submissions advanced before us were all forcefully put to her Honour on the plea. The primary submission advanced on the plea on behalf of the applicant was that he should receive a CCO without any term of imprisonment. To describe that as a bold submission would be a vast understatement.
On the application before this Court, the more realistic submission advanced on behalf of the applicant was that he should have received a short term of imprisonment with a CCO.
In my view, it might have been open to the sentencing judge to have fixed a sentence of just below two years’ imprisonment which could have been combined with a CCO. However, any CCO would have imposed conditions including unpaid community work, and would have had a duration of some years. As compared with the practical reality that the applicant will serve no more than twenty months’ imprisonment before being released on parole, a combined sentence could be viewed as less favourable than that in fact imposed by the sentencing judge.
The applicant’s offending occurred over a period of seven months. It involved 62 separate victims, a number of whom provided victim impact statements. The fact that they might recover their money from the Victorian Property Fund does not mean that they were not relevantly victims who suffered harm from the applicant’s conduct.
The applicant fraudulently converted and failed to account for close to $2 million. General deterrence had to be given a great deal of weight in considering the sentence to be imposed. So too did punishment and denunciation. Nothing in Boulton affects the cogency of the reasoning in that regard in Bulfin.
In my opinion, the sentence imposed was clearly within range. The ground that the sentence was manifestly excessive is not reasonably arguable.
For these reasons, leave to appeal should be refused.
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