Day v The Queen
[2011] VSCA 243
•15 August 2011
SUPREME COURT OF VICTORIA
COURT OF APPEAL
| S APCR 2009 0759 |
| ROBERT EWEN DAY |
| v |
| THE QUEEN |
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| JUDGES | NETTLE and NEAVE JJA and SIFRIS AJA |
| WHERE HELD | MELBOURNE |
| DATE OF HEARING | 15 August 2011 |
| DATE OF JUDGMENT | 15 August 2011 |
| MEDIUM NEUTRAL CITATION | [2011] VSCA 243 |
| JUDGMENT APPEALED FROM | [2009] VSC 266 (Forrest J) |
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CRIMINAL LAW – Appeal – Sentence – Guilty plea – Total of 182 counts of obtaining property by deception, obtaining financial advantage by deception, theft, and making and using false documents – Total effective sentence 11 years with a non parole period of eight years – Whether delay given sufficient weight in sentencing where appellant contributed to delay – Whether judge erred by imposing identical individual sentences for counts where the amounts appropriated were different – Whether judge erred in sentencing the appellant as a non-CCE offender within the meaning of s 6A(1) of the Sentencing Act 1991 – Whether such error vitiated the judge’s sentencing discretion – Warning under s 281(3) of the Criminal Procedure Act 2009 that allowing the appeal may lead to a more severe sentence – Appeal abandoned.
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| Appearances: | Counsel | Solicitors |
| For the Appellant | Mr T Kassimatis | Tony Hargreaves & Partners |
| For the Crown | Mr D A Trapnell SC | Mr C Hyland, Solicitor for Public Prosecutions |
NETTLE JA:
This is an appeal, with leave, against a total effective sentence of 11 years’ imprisonment with a non-parole period of eight years, imposed on the appellant on 31 July 2009 after pleading guilty to 182 charges of theft, obtaining property by deception, obtaining financial advantage by deception, and summary charges of misleading and deceptive conduct contrary to s 19 the Fair Trading Act 1999 (Vic), as follows:
· Obtaining property by deception: Counts 1–4, 7–28, 30–36, 38–54, 56–120, 123–154, 156–162, 164–182 (173 counts);
· Obtaining a financial advantage by deception: Counts 55, 121–122, 155, 163 (5 counts);
· Making a false document: Count 5;
· Using a false document: Count 6;
· Theft: Counts 29 and 37;
· Uplifted Summary Charges, Counts 1—6: Breach of s 19 of the Fair Trading Act 1999 (Vic).
The facts
At the time of sentencing, the appellant was 65 years’ old. He is married and has three adult children. He was educated to Year 10. After working for the Commercial Bank of Australia for some ten years, he moved to the United Kingdom and while working there acquired skills in conveyancing.
He returned to Australia after three years in the United Kingdom and, in 1972, married and began work as a law clerk in Geelong. In 1978 he began work for a local solicitor, Mr Philip Boston, and on 31 August 1988 he set up Grove Conveyancing Services (‘GCS’) in Mr Boston’s offices.
By 2002, the appellant was the driving force of GCS and, to outward appearances, the business was flourishing. By the time of its collapse in October 2004, it was operating from two offices in Geelong and Werribee.
GCS operated four bank accounts: a nominal trust account and an office account for each of the Geelong and Werribee branches. There was a regular inflow of funds from non-client sources and, more significantly, a large outflow of funds to persons other than clients or authorised payees.
The offending conduct occurred over an eight year period from 1996 to 2004. Some time during the 1990s, the appellant became aware of shortfalls in the business’ trust accounts and began to initiate actions in order to retain funds in those accounts. Five methods have been identified by which the appellant used funds lodged by clients without their authorisation in order to provide settlement cash flow, allow the business to continue trading and meet settlement obligations as well as to fund personal expenses. In brief substance, the details of the different categories of offending, and the individual sentences imposed in relation to each category, were as follows:
1) Misappropriation of Stamp Duty and Titles Office Fees: The appellant obtained funds from clients to pay stamp duty and any other Titles Office fees and subsequently neglected to do so. Clients were misinformed that the documents had been registered and stamped. They were unaware of the non-transfer of their land, which in some cases remained in the name of the vendor for over eight years, and, following the collapse of the business, were forced to attend to the transfer. The appellant was sentenced to periods of two years’ imprisonment (CCE offence count 115 only) and one year’s imprisonment (non CCE offences) in respect of each offence.
2) Wrongful use of Investments: The appellant approached clients and invited them to place funds with him for investment purposes, usually after he had acted as conveyancer for a vendor in the sale of a property and the funds had been placed in the business’ trust accounts. Forged receipts, letters and other documents were sometimes issued to clients. Funds received were used to pay interest or repayments of capital to other investors. Clients lost substantial sums of money. The appellant was sentenced to periods of five years’ imprisonment (CCE offences), three years’ imprisonment (non CCE offences involving sums over $50,000) and two years’ imprisonment (non CCE offences involving sums below $50,000) in respect of each offence. The appellant was sentenced to five years’ imprisonment in respect of Count 1 (Rolled-up count).
3) Misappropriation of Settlement Moneys/Delayed settlement: The appellant retained funds paid by purchasers to his clients. He deliberately misled clients as to what was happening with their money until it was too late for them to recover their funds. Few received even a portion of their funds and thus lost substantial sums of money. On other occasions, the appellant delayed settlement when acting for a purchaser. He provided a false explanation to the vendor’s solicitor for the failure to settle the purchase, did not inform the client of the delay and paid the penalty interest that had accrued to the vendor. The vendor suffered no loss as a result. In relation to the misappropriation of settled moneys counts, the appellant was sentenced to periods of five years’ imprisonment (CCE offences), two years’ imprisonment (non CCE offences) and three months’ imprisonment (count 167 only) on each count. In relation to the delayed settlement counts, the appellant was sentenced to six months’ imprisonment (CCE offences) and three months’ imprisonment (non CCE offences) on each count.
4) False Documents: The appellant drew up false documents such as false mortgages of land, discharges of mortgages, copies of altered certificates of title and forged bank letters to legitimise false investments. The appellant was sentenced to two years’ imprisonment on each count.
5) Personal drawings: The appellant used funds from the business’ trust account for personal payments such as credit card accounts, travelling expenses, personal loans, a property at Apollo Bay and a time-share unit. The exact amount appropriated by the appellant is unable to be determined. The appellant was sentenced to three years’ imprisonment on each count.
6) Breaches of Fair Trading Act: These charges relate to representations made to clients in relation to payments of stamp duty and land title office fees in contravention of s 19 of the Fair Trading Act 1999 (Vic). The appellant was convicted and fined $1,000 on summary charges 4, 5 and 6 and convicted with no penalty on summary charges 1, 2 and 3.
GCS collapsed while the appellant was holidaying in England with his wife. Staff identified a shortfall in the business’ bank accounts which held a sum significantly less than was required to meet a number of pending and delayed property settlements. The appellant’s son contacted the appellant about the shortfall. The appellant attempted to obtain money from a friend and from a business client, but without success. He subsequently disappeared for four days and was reported to British police as a missing person. He resurfaced, however, and in October 2004, he returned to Australia. He was interviewed by police on 25 October 2004. At that time, he denied any criminal behaviour and attributed the default to negligence on his part.
A joint task force made up of investigators from the Major Fraud Investigation Division and Criminal Investigation Unit was established under the name of Operation Micro. The appellant made a small number of admissions but did not actively assist investigators in revealing the extent of his actions and methods used to provide cash flow to the business.
The business did not possess proper financial records, did not conduct audits and had no annual returns. Nor did it have in place any controls to monitor its financial performance. Records maintained in respect of transactions conducted by the business were negligible.
In the end, only a minimal amount was recovered for creditors by the appointed trustee. The total loss attributable to the appellant was approximately $6 million.
Grounds of appeal
Ground 1: Delay
The first ground of appeal is that the sentencing judge erred by ‘ameliorating’ the significance of the delay between discovery of the appellant’s offending and his sentencing due to the appellant’s ‘hopeless record keeping’ and failure to assist police with their inquiries.
The argument is that, although the delay between offending and sentencing was ‘inordinate’, the judge improperly declined to give it the weight it deserved because, to a significant extent, it was due to the appellant’s inadequate records and failure to assist police and forensic accountants to determine the scope and details of his defalcation.
I do not think that there is any merit in the point. In his sentencing remarks the judge said this about delay:
Next, there is the delay which has occurred since your activities were discovered in October 2005 [sic]. The law requires me to take into account both the delay between the discovery of the commission of the offences and the laying of the charges (29 April 2008) and the delay after the laying of charges.[1] Whilst it is a relevant factor that over two years elapsed before you were charged, I do not regard the period from the time you were first interviewed to the time you were charged as inordinate, particularly as to a large extent the delay was due to your own hopeless record keeping and your failure to assist the police and Mr Curtin in relation to their inquiries. However, I am conscious of the fact that there has been overall a delay of nearly four years during which the prospect of imprisonment (inevitable as it was) has weighed heavily upon you and caused anxiety and uncertainty.
In summary, there are a number of reasons why a degree of mercy should be extended to you, notwithstanding the protracted course of your fraudulent conduct and the distress that it has caused many of your friends and clients.[2]
[1]R v Merrett (2007) 14 VR 392; R v Tiburcy [2006] VSCA 244.
[2]Sentencing remarks [75]–[76].
With respect, there is nothing wrong with that analysis. In point of fact, the delay in this case was not inordinate. It takes time to sort out a complex financial mess of the kind which the appellant created and it takes even longer when offenders like the appellant do very little, if not worse, to assist investigators in uncovering the true nature and precise details of the problem. Given the nature of the of the offending, and the failure of the appellant to reveal the details of it to investigators, it is just the sort of delay which one would expect.
Counsel for the appellant contended that, even though the judge said that he took into account the full four year period of delay, his Honour’s sentencing remarks were to be read as meaning that he significantly discounted the effects of the delay because ‘to a large extent the delay was due to [the appellant’s] own hopeless record keeping and [his] failure to assist the police and Mr Curtin in relation to their inquiries’. In counsel’s submission, that was an error because it flew in the face of a principle which counsel said was established by this court in R v Cockerell,[3] and subsequently confirmed in R v Merrett,[4] and in Reilly v R,[5] that an accused’s passive lack of co-operation, as opposed to positive delaying tactics, may not be taken into account in assessing the effects of delay.
[3](2001) 126 A Crim R 444.
[4](2007) 14 VR 392.
[5][2010] VSCA 278.
I do not accept that submission either. Given that the principal authorities on delay in this court were all built upon the conception, best articulated by Wood CJ at CL in R v Blanco,[6] that it is highly desirable that the prosecution act promptly when it has evidence of serious criminality and, if it fails to do so, it must expect the consequences to be taken into account on sentencing, it appears to me that there was every justification for the judge to have regard to the fact that a significant part of the delay was due to the appellant and his decision not to assist in the investigation of his malfeasance.
[6](1999) 106 A Crim R 303, 306 (Wood CJ at CL with whom Bell J and Smart AJ agreed).
In Merrett, Maxwell P, with whom Chernov JA and Habersberger AJA agreed, said that the significance of delay cannot depend on whether or not there is a satisfactory explanation for the delay.[7] For present purposes, so much must be assumed. But to say so in no way supports counsel’s contention that the extent to which an accused’s failure to cooperate may have contributed to delay cannot ever be regarded as a relevant sentencing consideration. To the contrary, the observations of Chernov JA in Cockerell, to which Maxwell P referred with express approval in Merrett, and each of Miceli, Todd, Schwabegger, MHW and Blanco, to which Chernov referred with express approval in Cockerell, were all concerned with delay which it was said could not be attributed to the offender. The decision in Reilly takes the matter no further. It was concerned with a judge who had taken into account against the prisoner’s delay which had been caused by the prisoner’s co-offenders and the desire of the Crown to have them dealt with first.
[7](2007) 14 VR 392, 400 [34].
As a matter of principle, too, given that one of the significant informing considerations in allowing a discount for delay is that an offender has had the prospect of punishment hanging over his or her head for an inordinate period, and to that extent has already been punished, it would be both illogical and contrary to ordinary notions of justice and fairness if a sentencing judge were precluded from taking into account the extent to which the offender had stood by declining to do whatever he or she could do to bring the matter to fruition.
As Ormiston JA said in R v Nikodjevic:[8]
One should .. be cautious about asserting that there is a right to some automatic discount in every case of asserted delay. The most that can be said is that where the prosecuting authorities have in fact unduly delayed bringing the matter to court, there is much more likely to be such a discount, without the need to have regard to its particular consequences.
The same applies here.
[8][2004] VSCA 222, [22].
Admittedly, Ormiston JA was dealing with sexual offences. In essaying the variable significance of delay in relation to such cases, his Honour observed that, whereas it may play a large role in some instances, it would be ‘preposterous’ for an offender who, say, had committed incest on a six year old child to claim some automatic discount 12 years later where the complainant had first felt safe to complain about her father’s conduct only at the age of 18.[9] As a matter of logic, however, similar considerations are capable of applying to a broader range of cases and, in my view, they apply here. Just as it would be preposterous for a paedophile to be able to claim the benefit of delay for which he was responsible, so too here it would be preposterous if an offender like the appellant could sit on his hands, doing as little as possible to assist investigators to accelerate the process of investigation, and then be able to claim the full benefit of so much delay as, in effect, he has created.
[9]Ibid [21].
Of course, so to conclude does not mean that the judge in this case would have been entitled to exclude consideration of delay altogether, or even perhaps substantially to reduce its significance in all of the circumstances of this case. But his Honour did not exclude it from consideration or substantially reduce its significance. As his Honour said, he was conscious that there had been overall a delay of nearly four years, during which the prospect of imprisonment had weighed heavily upon the appellant and caused him anxiety and uncertainty, and it was one of a number of reasons why a degree of mercy should be extended to the appellant despite the protracted course of his fraudulent conduct and the distress that it has caused many of his friends and clients.
There is nothing about the length of the individual sentences, total effective sentence or non-parole period which suggests that an appropriate degree of mercy was not extended to the appellant. If anything, in view of the nature, gravity and duration of the offending, and its dire consequences, I am inclined to think that the sentences were merciful.
Ground 3: Imposing identical terms of imprisonment
It is convenient to deal next with Ground 3. Under the heading of that ground, counsel for the appellant contended that the judge erred by imposing identical individual sentences for all counts disclosing the wrongful use of investment funds where the amount relevantly appropriated exceeded $50,000 and thus imposed the same sentence of five years’ imprisonment on counts 20 and 54 (for which the amounts involved were $55,000 and $51,500, respectively) as for Counts 51, 73 and 170 (for which the amounts involved were $205,872, $330,099 and $300,000, and the same sentence of five years’ imprisonment on Counts 147 and 172 (for which the amount involved exceeded $50,000 and thus the maximum penalty was 20 years’ imprisonment) where the amounts involved were $550,762, and one tenth of that amount, namely, $54,616, respectively.
In my view, that point has no merit. The offending at issue in this case represented an ongoing fraudulent course of conduct which warranted a broad brush approach to sentencing based on the sort of sentencing categories which the judge adopted. Certainly, some of them are wide, but they are, roughly speaking, proportional to the gravity of the offences, notwithstanding the disparities which counsel for the appellant has identified. It might be different if the matter had to be looked at only in terms of the amounts of money involved. In that event, his Honour’s classification could conceivably be thought too broad. But the amount of money involved in each offence is not the sole criterion. As the judge discerned, the criminal behaviour embraced in the subject category was strikingly similar as between counts and, as was observed in R v Ash,[10] factors such as that and the level of distress and inconvenience imposed on victims are also relevant considerations.
[10][2005] VSCA 43, [23]–[25] (Eames JA, Callaway and Buchanan JJA agreeing).
The point was made by Callaway JA in R v Fletcher,[11] in which the sentencing judge imposed the same sentence on all the counts of attempting to obtain financial advantage by deception, and all counts of obtaining financial advantage by deception, albeit that the amounts involved in the attempts ranged from $2,942 to $86,869 and the amounts involved in obtaining financial advantage ranged from $1,996 to $68,830. In rejecting a submission that the judge had erred in proceeding in that fashion, Callaway JA said:
I do not accept that submission. The distinction between the attempted offences, i.e. the failed transactions, and the completed offences was much more important than the individual sums involved. Even as between the two categories of offences a broad-brush approach was, and is, permissible in the circumstances of this case. In substance there was a single fraudulent enterprise of which the individual offences were components…[12]
[11][2002] VSCA 40.
[12]Ibid [11].
In my view, the same considerations apply in this case. I reject Ground 3.
Ground 2: Part 2B of the Sentencing Act 1991
I turn then, finally, to Ground 2. The complaint which is made here is that, although Counts 4, 9 11, 12 and 16 were continuing criminal enterprise offences within the meaning of Schedule 1A of the Sentencing Act 1991, and the appellant stood to be sentenced in respect of those offences as a continuing criminal enterprise offender within the meaning of s 6A(1) of the Act (because the appellant was found guilty of three or more such offences), the judge treated those offences as ‘non-CCE offences’ and so as attracting a maximum penalty of only 10 years’ imprisonment for each offence, rather than twice that amount as mandated by s 61 of the Sentencing Act 1991. According to counsel for the appellant, that was an error which vitiated the judge’s exercise of the sentencing discretion and thus required that it be exercised afresh.
Possibly that is so. The offences the subject of Counts 4, 9 11, 12 and 16 were continuing criminal enterprise offences within the meaning of Schedule 1A of the Sentencing Act 1991; the appellant did stand to be sentenced in respect of those offences as a continuing criminal enterprise offender, because he was found guilty of three or more such offences; the effect of that was to double the maximum penalty
applicable to each of those counts from 10 to 20 years’ imprisonment; and it is plain from the judge’s sentencing remarks that his Honour proceeded on the basis that the maximum penalty applicable to each of those counts was only 10 years’ imprisonment.
As the Crown submitted, however, it is difficult to understand why the appellant would take the point. The most likely result of allowing the appeal on that basis and re-sentencing the appellant on those counts would be to increase the individual sentences on those counts and thus in all probability to increase the total effective sentence and non-parole period.[13] If the other members of the court share that view, however, it would be necessary to warn the appellant that we are considering imposing a more severe sentence, and allow him an opportunity to withdraw his appeal before we proceed further.[14] In which event, the point would go nowhere.
[13]R v Ludeman [2010] VSCA 333, [94].
[14] Criminal Procedure Act 2009, s 281(3).
Conclusion:
For the reasons I have given, I propose that we warn the appellant that we are considering imposing a more severe sentence, and allow him an opportunity to withdraw his appeal before we proceed further.[15]
[15]Ibid.
NEAVE JA:
I agree and I agree with the proposed course of action that Nettle JA suggests.
SIFRIS AJA:
I also agree.
(Discussion re withdrawal of appeal.)
NETTLE JA:
Liberty is granted and the appeal is taken to be abandoned.
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