Director of Public Prosecutions(Cth) v Khoder
[2020] VCC 1524
•23 September 2020
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CRIMINAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No CR-19-00477
| THE QUEEN |
| v |
| RAMZI KHODER |
JUDGE: | HIS HONOUR JUDGE WRAIGHT | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 15 September 2020 | |
DATE OF SENTENCE: | 23 September 2020 | |
CASE MAY BE CITED AS: | DPP(Cth) v Khoder | |
MEDIUM NEUTRAL CITATION: | [2020] VCC 1524 | |
REASONS FOR SENTENCE
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Subject:CRIMINAL LAW
Catchwords: Plea of guilty – One charge of produce tobacco seed, plant or leaf not being the holder of a producer licence – Offender grew tobacco crop covering 5 acres – $1,929,000 in excise avoided – Relatively serious example of the offence – No prior criminal history – Very strong prospects of rehabilitation – Delay – Circumstances of COVID-19 taken into account.
Legislation Cited: Excise Act 1901 (Cth); Crimes Act 1914 (Cth); Sentencing Act 1991.
Cases Cited:The Queen v Kopa & Istogu (2004) 145 A Crim R 287; Director of Public Prosecutions (Cth) v Gregory [2011] 34 VR 1.
Sentence: Imprisonment for a period of 8 months, to be released forthwith on a recognisance of $3,000 and to be of good behaviour for a period 2 years.
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APPEARANCES: | Counsel | Solicitors |
| For the CDPP | Mr M Challen | Commonwealth Director of Public Prosecutions |
| For the Accused | Mr M Thomas | Stephen Andrianakis & Associates |
HIS HONOUR:
Introduction
Ramzi Khoder, you have pleaded guilty to one charge of produce tobacco seed, tobacco plant or tobacco leaf, not being the holder of a producer licence granted under Part IV of the Excise Act 1901 (Cth) (‘Excise Act’), contrary to s 28(1) of the Excise Act, which carries a maximum penalty of two years imprisonment and/or the greater of 500 penalty units or five times the amount of duty that would be payable if the tobacco leaf had been manufactured into excisable goods and entered for home consumption on the penalty day.
You have no prior criminal history.
Circumstances of the offending
The Australian Taxation Office (‘ATO’) has, through the Excise Act, sole responsibility for the regulation and collection of excise duty on tobacco products manufactured in Australia. An entity must have been granted an excise licence by the ATO to undertake the following activities:
·Manufacture tobacco products;
·Grow tobacco seed, plant or leaf;
·Deal in tobacco seed, plant or leaf;
·Store and distribute tobacco products; and
·Movement of tobacco leaf.
At no time did you apply for or hold an excise license to grow tobacco seed, plant or leaf.
In December 2006, the Australian Government withdrew all licences required to grow tobacco in Australia. Since this time, no entity or person has been licenced to grow tobacco commercially in Australia. Thus, any growing of tobacco in Australia became illegal from December 2006. After the closure of the legal domestic growing of tobacco, tobacco manufacturers sourced all their tobacco leaf from overseas. Since 2012, all tobacco products including cigarettes have been manufactured overseas and imported into Australia.
On or about 1 September 2016 you became the registered proprietor of a property at 19 Hayden Lane, Macorna in Victoria.
On 18 January 2017 the ATO received an Information Report from Victoria Police suggesting an illicit tobacco crop was being grown at your property.
On 20 March 2017, a seizure warrant pursuant to s 107CA of the Excise Act was issued. On 20 March 2017, a search warrant pursuant to s 107BA of the Excise Act was issued.
On 21 March 2017, ATO investigators and members of Victoria Police entered the property and executed both warrants. At the time the search commenced, your father Naser Khoder and a family friend, Mouhamad Abbas were present. The search commenced at 9:30am in your absence. ATO investigator Tamara Kinkead explained the terms of the warrant and the reasons why ATO investigators and members of Victoria Police were present to your father using an interpreter via telephone. Your father was cautioned during the conversation.
During the search ATO investigators together with Sergeant Barry Gray of Victoria Police observed a crop measuring approximately five acres in size that was suspected to be tobacco. A total of eight samples of the crop were taken from four separate points chosen at random.
You arrived at the property at approximately 4pm. ATO Investigator Kinkead commenced a recorded conversation with you during which the terms of the warrant and the reasons why ATO investigators and members of Victoria Police were present were explained. You were asked to comment about the crop that was observed and responded, ‘no comment.’
You were also asked questions about items on the property and you stated that you were not the owner of them. You stated that you had leased the property to ‘a Chinese man called “John” who comes through and goes through a side entrance’. You stated that a verbal agreement existed between you and John, and John paid you $3000 to lease the property. You stated that the lease commenced in November 2016. You provided a mobile phone number as a contact point for ‘John’. You stated that you did not know that the crop being grown was tobacco.
On 28 March 2017, you attended the ATO offices at 747 Collins Street in Docklands. You declined an offer to participate in a record of interview.
On 13 April 2017, Sergeant Andrew Rigg of Victoria Police attended the property and observed the tobacco crop appeared to have regrown. A number of people appeared to be attending to the crop. You approached Sergeant Rigg. Sergeant Rigg asked you what was going on as Sergeant Rigg understood that you had been instructed to destroy the crop. You stated, ‘we are stopping the dry leaves from blowing into the neighbours paddock so they don’t get in trouble’. When asked why the crop had not been ploughed, you stated, ‘we have to take the drip lines out’.
Sergeant Rigg observed workers gathering tobacco leaves and piling them into hessian bags. When asked why the leaves were being collected and placed in bags you stated, ‘to clean up so it doesn’t blow away. They are cleaning it so it can be ploughed’.
When asked what you were planning do with the collected leaves you stated you were going to burn them. When pressed about whether you completed the other half of the property you declined to answer further questions except through a lawyer.
You permitted Sergeant Rigg to continue looking on the property. Sergeant Rigg observed the section of the paddock where there were no workers to contain a healthy looking crop, and recently installed drip lines. Sergeant Rigg counted 24 packs of leaves in hessian in the back of a ute.
On 29 March 2017, the samples seized from the property were received by Excise Analysist Andrew Drinnan. On 30 March 2017, Mr Drinnan analysed the samples and determined that the samples were tobacco. At the time of the offending, the excise rate in force was $771.60 per kilogram. The potential excise value of the crop was $1,929,000.
Nature and gravity of the offending
In assessing the seriousness of the offence, consideration must be given to potential excise that would have been payable on the tobacco crop, based on the applicable excise rate at the time, which equates to $1,929,000. Further, the maximum financial penalty for the offence is linked to the duty that would have been payable, which in this instance would equate to a maximum financial penalty in excess of $9,000,000. That said, the maximum term of imprisonment for the offence must also be considered, which is two years.
In this instance the tobacco growing on your property covered an area of five acres which undoubtedly would have required a degree of planning, preparation and ongoing management. A further relevant fact in assessing the seriousness of the offending is that following the initial execution of the warrant on 21 March 2017, you continued cultivating the crop which was observed by police on 13 April 2017.
It is well established that offending of this nature which can broadly be described as defrauding the Commonwealth, is serious offending. The charge is however capable of covering a wide range of offending. For example, cultivating tobacco in a small amount for personal use or cultivating on larger commercial scale covering many acres or multiple properties. Here the amount of excise avoided is significant being $1,929,000 and in all the circumstances, in my view your offending represents a relatively serious example of the offence. While labels such as ‘mid-range’ can often be problematic, in this instance in my view it is an appropriate categorisation and one which was conceded by your counsel.
Personal circumstances
You are 29 years of age and were 27 at the time of the offending.
You were born in Lebanon and are the second oldest in a sibship of five.
Your father was an army officer while your mother was engaged full time raising the family and managing the small family property where you grew olives and other produce.
You completed year 12 in Lebanon and then commenced a university course in telecommunications engineering. You completed the first year of that course.
In 2009 you emigrated to Australia when you were 19 years of age and commenced a course of study in information technology. You completed two of three semesters.
In 2010 you married and left your studies to work full time as a delivery driver until 2012, when you began working in the security industry. You also obtained permanent residency in 2012.
In 2014 you enrolled in a Bachelor of Engineering at Victoria University however due to your marriage breaking down, you did not commence that study and you returned to casual employment in demolition industry.
In 2018 you returned to Lebanon to assist with caring for your father who had been diagnosed with cancer. Upon your return to Australia you enrolled in a Bachelor of Biomedical Science at Victoria University, commencing study in 2019. You completed the first year of that degree and obtained high marks. You are currently in the second year of the degree, learning remotely due to the pandemic however you anticipate completing the final year in 2021.
You ultimately have the goal of being a medical doctor and have attempted the Graduate Admissions School Admissions Test on two previous occasions. While not successful on those occasions, you are enrolled for a third attempt in September 2020.
In January 2020 your parents moved to Australia. They are currently on bridging visas pending protection applications. Your father’s cancer has returned since being in Australia and he is undergoing chemotherapy. You are living with your parents, assisting your father in attending medical appointments as you are the only support they have in Melbourne.
A number of medical documents were tendered in relation to your father’s illness. In a letter provided by Professor Peter Gibbs, medical oncologist, he summarised your father’s cancer as being locally advanced rectal cancer
(from the previous diagnosis in Lebanon) and local and distant recurrence rectal cancer. Professor Gibbs states that your father is responding well to the treatments being administered.
You father wrote a letter to the court providing further detail in relation to his illness and stating that because he and your mother cannot drive a car or speak English, he is dependent on your assistance to take him to medical appointments for treatment and follow up.
Relevant sentencing considerations
As the charge to which you have pleaded guilty is a Commonwealth charge, I am required to take into account a number of matters pursuant to s 16A of the Crimes Act 1914 (Cth). In his written submissions Mr Challen who appeared on behalf of the Commonwealth Director of Public Prosecutions, highlighted a number of the matters in s 16A(2) that must be given weight and I have taken those matters into account.
Mr Thomas who appeared on your behalf highlighted a number of relevant matters to be taken into account, the first of which is your plea of guilty. Your plea was offered after a contested committal and after the final directions hearing. While not a plea at the earliest opportunity, it was submitted that the settled charge and supporting facts are on very different terms to what was presented before committal and the evidence at committal ultimately informed the nature of the charge to which you have pleaded guilty. Therefore, in the circumstances your plea is still able to be considered as an early plea. Your plea has also saved considerable court time and expense and has thereby facilitated the course of justice.
You come before the court with no prior criminal history and no subsequent offending. You are otherwise a person of good character with a good work history and you are committed to study to provide you with a new career path. You are also dedicated to the care of your parents.
It was submitted that family hardship is able to be taken into account as an exceptional circumstance as your father in particular is reliant upon you as he battles with cancer. Your father’s anxiety is heightened as he is going through this difficult process in the COVID-19 environment. While I accept that if you were to be imprisoned this would create difficulties for your parents, in my view it would not amount to exceptional family hardship. That said, I do accept that any term of imprisonment would weigh heavily upon you because of the circumstances your parents would then be in.
In cases such as this it was submitted, and I agree, that general deterrence must be the paramount sentencing consideration.[1] In one of the few appellate cases involving avoidance of excise on tobacco leaf, William JA stated in The Queen v Kopa & Istogu[2]:
Deliberately defrauding the revenue is a serious offence and, particularly where the amount involved is large, a significant custodial sentence is called for. As the type of offence in question is prevalent a deterrent sentence is called for.
[1]Director of Public Prosecutions (Cth) v Gregory [2011] 34 VR 1 at [53].
[2] (2004) 145 A Crim R 287, at [25].
As to specific deterrence, in my view this principle should carry less weight in the sentencing discretion. You have no prior criminal history. You are now settled into a course of study and you are dedicated to supporting your parents. However as was pointed out by Mr Challen, upon detection of the crop, you continued to cultivate what you had grown and were effectively caught a second time. As such in my view some weight should be given to specific deterrence.
As to your prospects of rehabilitation, again given the fact that you have no prior history or subsequent offending together with the fact that you are now dedicated to advancing your education and supporting your parents, in my view your prospects of rehabilitation are able to be assessed as very strong.
It was submitted that delay is a relevant consideration. There was an initial delay of some 14 months between your record of interview and the laying of charges. There were then further delays as the matter progressed through the criminal process in the Magistrates' Court and in this Court. Ultimately, as noted above, the matter resolved at the final directions hearing in this Court and a plea date was set. Accordingly, there has been a delay of some three and a half years between your interview and the plea. It was submitted by the prosecution that the delay of 14 months included approximately three weeks where you were unable to be served with the charge due to you being overseas. That said, it did take some 12 months for the charge to be laid. The other delays were unfortunately due the passage of the matter through the criminal process.
The delay is relevant in two ways. First you have had the burden of this matter over your head for three and a half years which naturally causes anxiety. Secondly, in that delay period you have demonstrated that you have not reoffended, you have actively sought to better yourself and you have become committed to the task of looking after you parents, most particularly your father who is battling cancer. In all the circumstances the delay is able to be taken into account in your favour.
Finally, I take into account the COVID-19 considerations. The pandemic has affected the criminal justice system in many ways. Personal visits to prisons have been suspended, there has been a reduction of services and programs, and some prisoners are experiencing increased lockdown periods. The evidence demonstrates that the risk of contracting the virus is greater in environments such as prisons. The prosecution accepts that the onset of COVID-19 is a factor that is a source of additional anxiety and fear and would make prison more burdensome.
In my view, having weighed the applicable sentencing considerations, pursuant to s 17A(1) of the Crimes Act 1914, I am satisfied that no other sentence is appropriate other than a term of imprisonment.
Sentence
Ramzi Khoder, on Charge 1, produce tobacco seed, tobacco plant or tobacco leaf, not being the holder of a producer licence, you will be convicted and sentenced to 8 months imprisonment which will commence today.
Pursuant to s 20(1)(b) of the Crimes Act 1914, I direct that you be released forthwith upon giving a recognisance in the amount of $3,000 and to be of good behaviour for a period of 2 years.
Pursuant to s 6AAA of the Sentencing Act 1991, if not for your plea of guilty I would heave sentenced you to a period of imprisonment of 12 months imprisonment to be released after serving a period of 4 months.
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