Director of Public Prosecutions v Burgess

[2020] VCC 1497

IN THE COUNTY COURT OF VICTORIA

Revised

Not Restricted

Suitable for Publication

AT GEELONG

CRIMINAL JURISDICTION

CR 19-02223

DIRECTOR OF PUBLIC PROSECUTIONS

v

SCOTT BURGESS

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JUDGE:	HIS HONOUR JUDGE MULLALY
WHERE HELD:	Geelong
DATE OF HEARING:	2 September 2020
DATE OF SENTENCE:	18 September 2020
CASE MAY BE CITED AS:	DPP v Burgess
MEDIUM NEUTRAL CITATION:	[2020] VCC 1497

REASONS FOR SENTENCE

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Cases Cited:

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APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Ms D. Mandie	Office of Public Prosecutions
For the Accused	Ms L. Bauer	Lorraine A Bauer Lawyers

HIS HONOUR: 

1Scott Burgess, in 2007, you, your wife and your business partners purchased a building in the main street of Corryong.  The building was already leased to the ANZ Bank and had been from 2002. 

2In August 2018, the ANZ Bank closed the branch.  The commercial lease came to an end on 22 January 2019.  You held a real estate licence and accordingly managed the day-to-day dealings with the ANZ Bank regarding the building on behalf of the owners.  As part of that, the keys were returned to you on or about 18 January 2019.  You conducted an end-of-lease property inspection on or about 19 January 2019. 

3You then sent an email to the employee at the ANZ who was in charge of the lease, a Ms Mina Kumi.  In the email you made it clear that the property had not been left clean or oddly, empty of bank documents.  You said the property was not ready for handover. 

4On the material I have, it seems weeks went by until on 13 February 2019, in an email Ms Mina Kumi apologised on behalf of the ANZ Bank and indicated in oblique terms what was to be done. 

5I will set it out as she wrote it: 'I have followed up the Project's team looking after this site regarding the status.  I will give you an update as soon as I am notified.' 

6What in fact had been left in the vacant property were large bags full of documents containing confidential information of ANZ customers.  The job of taking the bags and having the personal information shredded was not done and the documents were just left in the building. 

7A month after the end of lease and two weeks after Ms Mina Kumi advised she would get on to the, 'Project's team looking after the site regarding the status' you sent an email to her, dated 25 February 2019 with the following: 'I have been in the Corryong branch over the weekend.  ANZ had left thousands of personal documents.  I have moved them to a secure spot.  Please see the attached photo of just a few.  ANZ have hundreds of cheque books, statement of Wills from solicitors, how much people have in their accounts.  I am very disappointed.  I live in a small country town.  I now know how much money many people have, their statement opposition, who receive what when people die.  Please see attached photos.  I can destroy the files.  They were in bags marked to be shredded.'

8You, however, added the following concerning words and I continue the quote:  'Or I guess I really should let Prime News see how ANZ leave branches, and what they do with people's personal information.  If you would like them destroyed, then ANZ would need to pay $25,000.  Kind regards, Scott Burgess.'

9Ms Mina Kumi moved quickly and reported the email to her superiors.  You later spoke to Ms Mina Kumi and said, amongst other things, 'We will work through this.  My main concern is the garden.' 

10There were further emails seeking money for the return of documents left by the bank in the building.  What follows these emails and communications were those that arranged a meeting to exchange the documents for payments.  On 28 February, five boxes of documents were handed over to ANZ employees, Mr David McGowan, Group Integrity Lead, and Ms Jennifer Banks, Senior Investigator at the Wodonga branch on the ANZ Bank.

11The conversations were covertly recorded by the ANZ employees on that day.  I have listened to those recordings.  What is clear is that the ANZ staff themselves were incredulous that the personal and confidential communications were just left on the floor of the bank.  Then Mr McGowan says, 'It beggared belief.' 

12You too were incredulous.  Your interactions with the investigators from the ANZ Bank at the branch when you gave the documents that are revealed in the covert recording, in my view establish an aspect of naïvety in the way that you were conducting this transaction.

13On that day a receipt was provided by the Bank to you indicating a transfer of $25,000 to you to your personal account.  Immediately after the meeting, the payment was reversed.  Obviously, there was no intention on behalf of the bank to actually pay you $25,000.  You naïvely accepted that the transfer to your personal account would be a permanent payment.

14Also, immediately after the meeting, you were arrested.  In your record of interview, you emphasised that you were willing to hand over the documents, but you wanted fair compensation for dealing with the documents and that the bank building be returned to a clean and tidy state.

15A day or two after your arrest you found more documents.  You contacted the police who directed you to speak to the bank staff directly.  The conversation that occurred had within it, that you said that there were more documents and that the ANZ Bank should pay you a holding cost in order to have them returned. 

16These two episodes of the communications demanding money for the return of documents left by the bank have resulted in you being charged in a single but rolled up charge of blackmail.  You have pleaded guilty.  I note also that your wife was also charged but sensibly her charges were discontinued by the prosecution.

17Having pleaded guilty, you put the following matters as an explanation and in mitigation of penalty.  As I have said, you are a real estate agent and thus, you are familiar with commercial leases, including the obligations on commercial tenants to get approval for alterations and to hand the property back at the end of the lease in proper condition. 

18After the charges were laid, you have obtained a property report that outlined and costed the problems with the condition of the property after the ANZ ended the lease. 

19The opinion of the person that you engaged to do the property assessment was that it would cost $27,615 to effect the necessary repairs.  This matter has appropriately settled with terms confidential between you and the bank.

20Also, in mitigation, you pointed out that emails seeking a response to dealing with the building problems were not dealt with in a timely way.  You also point out the time it took to have the bank deal with their inadvertence of leaving the documents in the bank.  Your counsel put it this way and I quote from his written submissions: 'It is submitted that the demands of' - you - 'can be seen as relatively short-lived instances of irrational behaviour from an otherwise good man, that the genesis of this behaviour is the belief that he was entitled to compensation for damage to the building, and as a means of getting the ANZ to take him seriously and negotiate the matter.' 

21There was no particular pre-meditation to commit the offence.  There was no effort to disguise who you were and what you were doing, that is, you used your own name and your own personal bank account and attended personally at the Wodonga branch. 

22The prosecution in very considered, written and oral submissions, did not take issue with this analysis, but emphasised that unlike your counsel's submissions, the prosecution see this conduct as sufficiently serious to warrant some imprisonment. 

23As to the gravity of your conduct, I note that the commercial reputation is important to the ANZ Bank.  It did not want its inadvertent failure to protect customers confidentiality to be widely known through the local media.  It simply wanted its property back so it could actually do what was intended at the outset, and that is to shred the documents that were left in the bags and left in the bank building.

24Your exploitation of the situation that arose is to be condemned, but I cannot see this as a sophisticated, highly malevolent example of blackmail.  Plainly it was not nearly sharp business practices and even with your level of naïvety you knew it was wrong. 

25The second demand that you made adds a concerning element. Your annoyance at the ANZ Bank for the way they left the building and dealt slowly with your concerns may have prompted you to act irrationally and attempt to exploit the situation of the documents being left, but the delays, if they are delays, are simply no excuse.  

26The sum that you demanded in the first email was a significant amount of money.  The fact that it was foredoomed from the outset does not diminish the sizeable amount of the demand and the attached level of criminality. 

27As to your personal circumstances, there is much that can be said in your favour.  You are now 40 years old.  You were raised by your hardworking supportive parents in Corryong.  Your one sister is a Chartered Accountant.  You attended local schools leading to qualifications in Horticulture.  At the early age of 19, you commenced your first business, the Corryong Nursery.  You operated that business in a hands-on way until 2006 and you moved then into the real estate business.  You still own the Corryong Nursery. 

28In 2006, you moved to Queensland and obtained your real estate qualifications.  You worked in Queensland for two years before travelling overseas.  You met and married a Mexican woman who migrated back to Australia with you.

29You lived again with her in Corryong.  You and your wife, or then wife, had a son in 2010.  The relationship ended in 2014.  She returned to Mexico with your son.  The relationship is still amicable, and you provide significant funds for your son's education in Mexico.  You also visit your son in Mexico regularly.

30When you returned to Corryong from overseas in 2008/9 you operated your real estate business there.  In 2016, you met your current wife and in 2017, you and she had a daughter.  You and your wife now operate a wholesale fuchsia nursery and have done so since 2016.  Unfortunately, much of that business was destroyed by the catastrophic bushfires of last summer. 

31The bushfires had a significant impact on you and your parents who lost their home.  It was, for you and your family, as well as the whole community in the
North-East of Victoria and in particular, in Corryong, a truly terrifying experience.  You, your wife, and your parents lost a great deal, but you still consider yourself one of the lucky ones in the Corryong community. 

32The devastation to your wholesale nursery will take you years to recover from.  The onset of the COVID-19 pandemic quickly after the bushfires has further adversely impacted upon your business.  All these matters caused you to take stock and, in the future, you intend to live as simply as possible.  You have been a successful businessman who has accumulated a property portfolio, and this will be the backbone of your income while you recover the fuchsia business. 

33Your work ethic is to your credit.  You have, in the past, also been involved in community activities such as Rotary.  As to your response to this offending, you are ashamed and remorseful at your conduct.  Your involvement in the criminal justice system has had a deterrent effect on you. 

34You are, in my estimate, unlikely to offend again.  You have one relevant prior matter, receiving stolen goods which was committed over ten years ago and for which you received a non-conviction adjourned undertaking imposed by a Magistrate.  Your counsel explained that you have bought a painting that was dishonestly obtained.  While relevant, I note the light penalty and how long ago it occurred.

35Your counsel urged that a community corrections order or a fine would meet all the sentencing considerations of this unusual case of blackmail.  He added that a conviction would seriously impede your capacity to travel to Mexico to see your son.  He submitted that a non-conviction penalty ought be imposed. 

36The prosecution argued, as I have already indicated, that some imprisonment was required, whether alone or in combination with a community corrections order.  The prosecutor referred to a relatively recent Court of Appeal decision of Loftus[1] and as such, given that it is the most recent statement on blackmail, I need to examine what was said in that case.

[1]Loftus [2019] VSCA 24

37The accused, Loftus, was dealt with for 14 charges, being two burglaries, three thefts, seven obtaining property by deceptions and an attempt to obtain property by deception and one charge of blackmail.  He was sentenced by a County Court judge to three years with a minimum of two which was reduced on appeal to two years with a minimum of one.  The sentence for blackmail was 12 months' imprisonment and that was the base sentence. 

38The brief circumstances were that the accused Loftus entered as a trespasser, various building sites stealing tools, a wallet with a credit card, and importantly, the master keys to the building.  He used the stolen credit card to obtain property by deception.  He was an employee of a firm who was contracted to provide services at the building site.  He was arrested soon after the crimes. 

39After his arrest and interview, he then contacted his employer and said that he would return the stolen keys so long as he was paid $500 in instalments.  The money was in fact paid, but no keys were returned.  Rather, there were further demands which were made and paid, a total of $650 was paid.  The keys were never returned. 

40Importantly, the effect of the accused Loftus, not returning the keys, was that the building owners had to change all locks at a cost of just short of $20,000.  The sentencing judge determined that the blackmail was in the lower part of the mid-level of gravity. 

41Of particular concern to the sentencing judge and the Court of Appeal was that the blackmail occurred brazenly after the arrest for the burglary and thefts.  It was persistent and money was obtained, albeit modest amounts.  The overall effect was much more than that, that is the 20,000 odd dollars to fix the locks.

42In a portion of the judgment quoted by the prosecutor in her written submissions, the Court of Appeal spoke generally of the nature of blackmail.  The Court of Appeal in Loftus said this: 

'Blackmail is an inherently serious offence.  The threatened harm may involve physical harm, threat to property including property of another, embarrassment or shame.  It is usually predicated on persuading the victim that compliance with the demands is likely to be less onerous than the consequences of refusing to meet demands.'

43As is clear in what the Court of Appeal said, the gravity of blackmail can vary from threats of  physical violence perhaps at one end, to threats of creating shame or embarrassment, as is the case here. 

44It can, as was referred to in Loftus, be an exploitation of very vulnerable victims or a victim may be of a different kind.  It seems to me that the decision in Loftus emphasised that the offence of blackmail is always serious but can vary a great deal in terms of its gravity. 

45Taking into account all aspects of individualised sentencing, that is, the rolled-up crime that you committed of blackmail, with all your personal circumstances, what, in my view is kept open, is a sentence other than one of imprisonment.  A consideration of the decision of the Court of Appeal in the guideline decision of Boulton[2] what is made clear in that decision is that crime, serious crimes that may well have seen mid-range imprisonment being imposed, can now be properly punished by a community corrections order. 

[2]Boulton [2014] VSCA 342

46In the new sentencing landscape created by the community correction system, I cannot impose imprisonment unless that is the only punishment that would satisfy all the sentencing purposes. 

47In my view, the important sentencing purposes of denunciation and deterrence, especially to others, as well as your rehabilitation are able to be met by a sentence other than a term of imprisonment.  Thus, I cannot impose a term of imprisonment. 

48An onerous community corrections order is a just and appropriate sentence.  However, in my view, considering all your circumstances and the gravity of this offence, it is a community corrections order that must come with a conviction.  The need for denunciation and deterrence are important and would be undermined if there was a non-conviction penalty imposed.

49While it may be difficult for you to arrange in the future visits to Mexico, that is not so compelling in terms of your social circumstances to justify a non-conviction penalty for a blackmail over two incidents rolled-up as one charge involving a demand for $25,000. 

50Doing the best I can and for the reasons that I have set out, I impose the following penalty. 

51On the rolled-up charge of blackmail, Charge 1, you are with conviction placed on a community corrections order for two years.  That will be a community corrections order that will involve unpaid work, the amount of unpaid work is 250 hours. 

52Had you pleaded not guilty to these offences and been found guilty of them, I would have imposed a sentence of 18 months with a minimum term of 10 months. 

53Are there any other orders required Ms Mandie?  You are just on mute.  Thank you, yes. 

54MS MANDIE:  Sorry.  I don't believe so, Your Honour, but I will just check with my instructor. 

55HIS HONOUR:  Thank you.  It is just a standing question that I ask because I always find myself overlooking.  I am not saying that there are any. 

56MS MANDIE:  No, there are not, Your Honour.

57HIS HONOUR:  Very kind, thank you.  Ms Bauer, is there anything further that needs to be done?  All right, Mr Burgess, what needs to happen is I need to explain to you what is involved in a community corrections order. 

58Had we had this as a face-to-face hearing as was common before COVID then you would be given a document and you would sign it.  That cannot occur, so what you have to understand is, I have placed you on a two year community corrections order. 

59Now, the conditions that apply to everyone on a community corrections order, and of course apply to you, are the following, and the first is very important, although I am sure from your involvement in this crime, you will not be back before the courts. 

60But if you commit an offence that is punishable by imprisonment in the period that the community corrections order is upon you, that will breach the order and you will come back before me to be re-sentenced on the crime that you committed, that of blackmail. Do you understand that?

61OFFENDER:  Yes, I do, Your Honour, yes.

62HIS HONOUR:  Thank you.  The other core conditions really are about cooperation.  The Office of Corrections may well have to, pursuant to the sentencing regulations, take photographs or get details from you.  You have got to cooperate with them in that regard. 

63You have to cooperate with the Office of Corrections in a number of other ways.  You must let them know if you change your address or change your job.  You must let them know, and this is particularly important both at the moment and generally, given where you are, you must let them know if you wish to - and get permission before can leave the State of Victoria. 

64The Office of Corrections in Wodonga are well-familiar with how it all works for those that are close to the border, but you have got to keep in touch with them about that. 

65Also, you must report to the Office of Corrections which will be in Wodonga, within two clear working days of this order being made, so you must contact them by telephone. 

66Do so either today or on Monday to get this Corrections Order moving.  You may have to receive visits from the Office of Corrections from time to time.  Do you understand all those core conditions?

67OFFENDER:  Yes, I do, Your Honour. 

68HIS HONOUR:  All right.  The other condition that is a program condition in a sense that it applies just to you is, you are required to do 250 hours of unpaid community work. 

69They will organise with you how that is done in the COVID environment, how it might be done as restrictions are lifted, but the requirement upon you to do the 250 hours which is a significant amount of hours, is not optional or voluntary. 

70You must do each hour as required by the Office of Corrections.  Should you not do that, that would breach your order and again you would come back before me, and it is likely to end up in a different outcome.  All right, you understand that? 

71OFFENDER:  Yes, I do, Your Honour.

72HIS HONOUR:  As I say, you would normally sign a document which we cannot, that is not the way it is working in a COVID environment.

73What occurs is, I will sign the document and indicate on it, that you consented to the making of the order in the virtual hearing.  Do you consent to the making of that community corrections order?

74OFFENDER:  Yes, I do, Your Honour.

75HIS HONOUR:  Thank you.  All right, well that document will be provided to your solicitors and to you.  There is nothing further Ms Mandie? 

76MS MANDIE:  No, Your Honour.

77HIS HONOUR:  No.  Thank you very much for your assistance and to the solicitors and the barrister, Mr Cronin, who was involved at an earlier point. 

78I will leave the meeting and others can leave directly after.  Thank you. 

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