Director of Public Prosecutions v Gadd
[2022] VCC 315
•18 March 2022
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CRIMINAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CR-21-01625
Indictment No. M10943939
| DIRECTOR OF PUBLIC PROSECUTIONS |
| v |
| ROBERT ADRIAN GADD |
JUDGE: | HIS HONOUR JUDGE TRAPNELL | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 25 February 2022 | |
DATE OF SENTENCE: | 18 March 2022 | |
CASE MAY BE CITED AS: | DPP v Gadd | |
MEDIUM NEUTRAL CITATION: | [2022] VCC 315 | |
REASONS FOR SENTENCE
Subject: CRIMINAL LAW – Sentence
Catchwords: Sentence – Obtaining property by deception – Rolled-up charge –$316,500 obtained over a ten month period – Committed in circumstances of severe financial distress – Early plea of guilty – No prior criminal history – Excellent prospects of rehabilitation – Minimal requirement for specific deterrence or protection of the community
Legislation Cited: Crimes Act 1958 s 81, Sentencing Act 1991 ss 5(2A), 6AAA
Cases Cited:
Sentence:
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APPEARANCES: | Counsel | Solicitors |
| For the Prosecution | Ms H Edwards | Ms A Hogan, Solicitor for Public Prosecutions |
| For the Accused | Mr D Grace QC | The Office of David Grace QC Barrister & Solicitor |
HIS HONOUR:
1 Robert Adrian Gadd, you have pleaded guilty to an indictment containing one charge of obtaining property by deception[1] (Charge 1).
[1] Contrary to ss 321M and 82 of the Crimes Act 1958.
2 The maximum penalty for obtaining property by deception is 10 years’ imprisonment.[2]
The Facts
[2] S 81 of the Crimes Act 1958.
3 The prosecution filed a summary of prosecution opening dated 25 January 2022 which I have been told by your counsel I can treat as a statement of agreed facts.[3]
[3] Exhibit (‘Ex’) P1.
4 You were born on 23 January 1982. You were aged between 35 and 36 at the time of the offending.
5 The victim in relation to Charge 1 is RAMS, a subsidiary of the Westpac Banking Corporation.
6 At the time of the offending, you owned a vacant block of land situated at 2 Minter Street, Belgrave (‘the land’).
7 On 27 July 2017 you applied for two loans from RAMS (‘the lender’). One loan was for the purchase of the land. This loan does not form any part of the offending and is not under any investigation.
8 The second loan was for a building loan for the construction of a house on the land (‘the loan’). This type of loan is specifically for the construction or renovation of a dwelling, where approved funds are disbursed in instalments. At the completion of each construction stage, the borrower signs a Progress Payment Request form confirming they are satisfied with the work that has been completed. This form, along with the builder’s invoice, is sent to the lender’s Progress Payment Team for processing. The sum of the invoice is then transferred from the lender to the account nominated for the builder. When construction of the dwelling is complete, a ‘Completion Payment Request’ is sent to the lender. Upon receipt of this request, and before transferring the final instalment, the lender undertakes a final inspection of the dwelling that has been constructed or renovated.
9 The loan was approved and established in your name and CC PR1 Pty Ltd as a trustee for the Robert Gadd Family Trust, with you and CC PR1 Pty Ltd listed as guarantors. You were the Director and owner of CC PR1 Pty Ltd.
10 Construction of the house was to be undertaken by Equal Living Pty Ltd. You were the Director and sole shareholder of this company.
11 The account nominated by you for payment of the Progress Payment Requests was a Bank West account in the name of Equal Living Pty Ltd (‘the Bankwest Account’).
12 When the loan was approved some initial work was undertaken on the land.
13 Two legitimate Progress Payment Request forms were submitted to the lender. The first in October 2017 for a deposit on the building project, and the second in November 2017 for the removal of trees. Both forms were approved by the lender and the sums requested were transferred to the Bankwest Account.
14 Following the November 2017 transfer by the lender, work ceased on the property. However, you proceeded to submit the following fraudulent Progress Payment Request forms:
a) On 7 December 2017, attaching an Equal Living Pty Ltd invoice dated 13 October 2017 for ‘site cut’ in the sum of $63,300. The lender processed and transferred the invoiced sum on 11 December 2017.
b) On 14 December 2017, attaching an Equal Living Pty Ltd invoice dated 26 October 2017 for the garage base in the sum of $63,300. The lender processed and transferred the invoiced sum on 18 December 2017.
c) On 13 June 2018, attaching an Equal Living Pty Ltd invoice dated 26 October 2017 for the house base in the sum of $42,200. The lender processed and transferred the invoiced sum on 15 June 2018.
d) On 10 July 2018, attaching an Equal Living Pty Ltd invoice dated 26 October 2017 for the frame of the house in the sum of $42,200. The lender processed and transferred the invoiced sum on 12 July 2018.
e) On 14 August 2018, attaching an Equal Living Pty Ltd invoice dated 14 August 2018 for lock up in the sum of $63,300. The lender processed and transferred the invoiced sum on 15 August 2018.
f) On 16 October 2018, attaching an Equal Living Pty Ltd invoice dated 16 October 2018 for ‘fix’ in the sum of $42,200. The lender processed and transferred the invoiced sum on 18 October 2018.
15 All invoices submitted after November 2017 were fraudulent, and on each occasion the lender transferred the invoiced sums to the Bankwest Account. In total, you submitted fraudulent requests for payment to the value of $316,500 and that amount was transferred the Bankwest Account.
16 You never submitted a Completion Payment Request as required under the loan agreement. During 2020 you were unable to be contacted by the lender and subsequently defaulted on the loan.
17 During August 2020, representatives of the lender attended the land to inspect the property. They observed the land to be listed for sale, with no sign of any building construction. The matter was referred to police.
18 In May 2021, police attended the land. They also observed it was vacant land and a ‘For Sale’ sign was erected. Further enquiries by police discovered the land was previously listed for sale and sold on 15 December 2020 as a vacant block of land.
19 On 7 May 2021, you attended Lilydale police station by appointment where you participated in a record of interview. You answered ‘no comment’ to all questions, as was your right. You were charged by way of summons on that day. You appeared at the Melbourne Magistrates’ Court for a filing hearing on 10 May 2021.
Victim Impact
20 No victim impact statement was tendered at the plea hearing. Nonetheless, it is to be observed your offending conduct is not victimless and the impact of this type of offending falls upon the whole community.[4]
[4] See R v Cave (1988) 32 A Crim R 484, 487 (O’Bryan J. McGarvie J agreeing); R v Moss (Unreported, Victorian Court of Appeal, Brooking and Charles JJA and Hampel AJA, 20 October 1997).
21 No restitution is sought, the lender’s loss being mitigated to a large extent by the sale of the land.
Offence Seriousness
22 The offence you have committed is serious, carrying a maximum penalty of imprisonment for ten years. In R v Cave[5] O’Bryan J commented upon the effects of frauds on finance companies and said:
Conduct of the kind perpetrated by the applicant is serious and impacts upon the community by way of making it more difficult for persons to obtain finance and possibly at higher cost. It is probably necessary to say through the courts to persons in the financial community and would-be borrowers that an offence of this kind will not be treated leniently by the courts, but may bring, in appropriate circumstances, a sentence of imprisonment.[6]
[5] (1988) 32 A Crim R 484.
[6] Ibid 487 (O’Bryan J, McGarvie J agreeing). See also R v Kostikidis (Unreported, Supreme Court of Victoria, Court of Appeal, 12 September 1996) 11–12 (Charles JA, Winneke ACJ and Callaway JA agreeing).
23 Similarly, in R v Moss,[7] Charles JA, in the context of credit card fraud, said:
The money obtained was substantial, and the sums sought on the housing loans were very large indeed. The learned judge was plainly entitled to give weight to both specific and general deterrence. Banks and other lending institutions have little alternative but to rely to a substantial extent on the truthfulness of statements made in applications for finance, and on the honesty of applicants. Credit and other checks imposed by such institutions to attempt to avoid losses caused by frauds of this kind increase the cost of lending, and are reflected in higher charges made by the institutions and borne by the whole borrowing community. Offences such as here occurred are difficult to detect, expensive to prosecute and prevalent. They are unquestionably serious.[8]
[7] Unreported, Victorian Court of Appeal, Brooking and Charles JJA and Hampel AJA, 20 October 1997.
[8] Ibid 8–9 (Charles JA, Brooking JA and Hampel AJA agreeing) (citations omitted). See also R v Patniyot [2000] VSCA 55 [38] (Charles JA, Winneke P and Callaway JA agreeing); R v Fernandez [2006] VSCA 38 [23] (Mandie AJA, Chernov and Eames JJA agreeing).
24 Your offending conduct is serious enough, although not as serious as many cases of this type that come before the courts.
25 I consider this offence to be at the lower end of mid-range offending for offences of this type. No breach of trust was involved, and your moral culpability is lower than many who commit offences of this nature, although, it is increased by reason of you persisting with your criminal conduct after the first false invoice was paid. You had time for calm reflection and there were many opportunities for you to desist from further offending. The offence was not spontaneous, but required forethought and it was relatively well planned, albeit not particularly sophisticated. Moreover, your offending conduct involved six separate criminal acts, committed over a period of some ten months.
26 On the positive side, there was no attempt by you to conceal the true identity of the borrower and your crime was bound to be discovered sooner or later. Moreover, while you committed the offences for personal financial gain, there is no evidence you were supporting an extravagant lifestyle. The use to which you put the proceeds of your crime is unknown.
27 Mr Grace, of Queen’s Counsel, who appeared on your behalf, accepted the offending was ‘serious’ and the amount involved is large.[9]
[9]See ‘Outline of defence submissions upon the plea in mitigation’ dated 22 February 2022 (Ex D1).
28 Clearly, as Ms Grace accepted, denunciation, general deterrence and just punishment must loom large in sentencing you.
29 In light of your lack of any prior criminal history or subsequent offences, together with the level of your remorse, I consider I need give very little, if any, weight to specific deterrence and protection of the community.
30 I accept you have gained and continue to develop insight into the reasons for your offending on this occasion. You have a good work ethic and you have a supportive family, friends and colleagues. Accordingly, I consider you have excellent prospects for rehabilitation.
Personal Circumstances
31 At the time of these offences, you were aged between 35 and 36 years old. You are currently 40 years old. You grew up in Wheelers Hill and in Sale. You have a brother who is a physiotherapist working in an area of practice involving treatment for joint replacements. Your brother is married with one child. Your sister is a doctor of osteopathy and has a clinic in Wheelers Hill.
32 Your father worked at Westpac as a manager and financial planner for approximately 40 years and retired in 2016. Your mother worked as a nurse for all her working life and also retired in 2016. Both of your parents are very supportive of you and your family.
33 You are married to Charlotte Gadd. You met her in 2010 and you married in 2014. You have three children, Cooper aged 7, Xavier aged 5 and Ari aged 1. Your wife worked for Awards Australia for approximately two years after completing her university studies and in the early years of your building maintenance business whilst you were doing Transport Accident Commission (TAC) work. She is now engaged in home duties. Both you and she are devoted to your children.
34 You and your wife presently live in rented accommodation in Kilsyth South and have done so since 2020. You pay $680 per week rent.
35 You completed VCE in 1999 at Mazenod College where you were a school prefect and a pastoral care leader. You commenced a Bachelor of Applied Science and Environmental Management Degree at Monash University in 2000. Whilst at university you had three part-time jobs and worked as a licensed security guard at Telstra Dome, Bunnings, Melbourne Park and Olympic Park. You continued these part-time jobs for the next decade.
36 You were entrepreneurial from an early age at university and purchased an investment property from your savings, completed a renovation of the property and let it. Half way through 2001, you left university and continued working at three separate jobs as a security guard and continued to renovate properties and sell them for profit.
37 In 2002, you purchased a block of six units in Frankston, renovated them and sold them. In 2003, you started working in the construction industry part time with a builder. You developed your manual skills which you had previously taught yourself and in 2007 commenced a two-year Certificate IV in Building and Construction. You became a Registered Builder. You also completed Certificate III in Occupational Health and Safety. In 2011, you established Equal Living Pty Ltd. The company specialised in home modifications for the elderly and disabled and became one of TAC’s preferred main suppliers.
38 In 2013, you purchased a franchise for the supply and installation of real estate sign boards. The business was ultimately unsuccessful and you lost $300,000 that you had invested. During that period and until 2015, you stopped doing building work. You commenced building work again in 2015 after the failure of the sign business. Typically, you would buy a block of land, erect a house on it and hope to sell the property for a profit. At the same time, you purchased earthmoving equipment and commenced doing plant hire jobs and selling asphalt.
39 On 3 September 2015, you purchased the property at 2 Minter Street, Belgrave for $118,000. The initial purchase was funded by a mortgage from RAMS and $20,000 from your savings. The property was settled on 4 March 2016.
40 Subsequent to the purchase of the land in Minter Street, you applied for and were granted a planning permit for building and works to construct a dwelling and vegetation removal in respect of the land. The permit was issued by the Yarra Ranges Council on 31 August 2016.
41 In order to proceed with the construction of your planned home on the property, you made an application for two loans with RAMS on 27 July 2017. One loan was in respect of the land, which was a refinancing of the original loan you already had. The second loan was a building loan for the construction of a house on the land. This was the loan that was the subject of your offending behaviour.
42 In order to commence construction on the land a building permit was required. The permit was ultimately obtained on 4 July 2018. A number of the drawdowns in respect of the building loan occurred prior to the grant of the building permit. RAMS did not require proof of the grant of a building permit before any of the drawdowns.
43 By the time of the grant of the loans in 2017, you and your business were in difficult financial circumstances. The loss of $300,000 in the failed sign business had caused great financial and emotional stress. You needed working capital for your building business but your projects made little profit. You were the sole breadwinner and needed to provide for your family.
44 In 2017, you commenced clearing the land in Minter Street, but you did not have sufficient funds to proceed further. A small commercial investment you had made in a shop proved disastrous after the tenant left the premises owing you $90,000.
45 Ultimately your family home in The Basin had to be sold in 2020. You could not pay the interest on the mortgage and by that time you decided to put the Minter Street property on the market. You are now assetless. Your wife is currently receiving Centrelink payments and you are engaged in casual employment performing minor maintenance jobs.
46 The property the subject of this offence was sold in September 2021 for $349,000, with the proceeds of sale being paid to RAMS. Almost all the principal advanced to you has been repaid. A small amount of principal and a much larger amount of interest is outstanding. You intend to repay these monies as soon as you are able to do so. You wish to come to an arrangement with Westpac for repayment of the outstanding amount.
47 You have never used illicit substances and you do not smoke or consume alcohol, other than very occasionally.
Mitigating Circumstances
48 You have no prior criminal history, no subsequent offences and no matters outstanding. I have had regard to the character references provided by your family, friends and colleagues[10] who all speak highly of you. I accept you are hardworking and a good provider for your family. I also take into account the matters contained in the trade references[11] and the various certificates tendered at the plea hearing.[12] I accept you have a good work ethic.
[10] Ex D6.
[11] Ex D7.
[12] Ex D8.
49 You fall to be sentenced as a person of otherwise good character, who has committed a number of dishonest acts under circumstances of severe financial hardship.
50 You indicated an intention to plead guilty to the present offence prior to the first committal mention on 2 August 2021. I accept yours is a plea entered at the earliest reasonable opportunity. Your plea has significant utilitarian benefit, particularly in the COVID-19 environment. The plea also indicates your acceptance of responsibility for your offending conduct and a willingness to facilitate the course of justice.
51 I accept you are genuinely remorseful for your actions and you are ashamed of your behaviour.[13] The Crown accepts you demonstrate a level of remorse.
[13] See report of Brenda Hughes dated 4 March 2022 (Ex C2) p 2.
52 You accept the charge is serious and the amount involved is large, even though the loss has been mitigated to a large extent by the sale of the subject land at a considerable profit. I accept you committed this offence in circumstances of need rather than greed.
53 You have always worked hard and you are determined to rehabilitate yourself and become a role model for your children. You also desire to repay your debt to society and the victim for your wrongdoing. I assess you have excellent prospects for rehabilitation.
54 Prior to committing the present offence, you had no history of diagnosed mental health illnesses. However, you have experienced considerable distress over the past few years owing to financial stress and concomitant feelings of inadequacy. Consequently, you were referred by your general practitioner to a psychologist, Janis Lee. I have had regard to the contents of her letter dated 24 December 2021.[14] You attended six treatment sessions between 10 August 2021 and 21 December 2021.
[14] Ex D5.
55 You were diagnosed as having extremely severe depression and also suffering high levels of anxiety and stress. It is accepted by you these symptoms are situational and attributable to your current circumstances. Ten further treatment sessions have been approved. With further treatment, your current symptoms will hopefully resolve once you are sentenced. In the meantime, you are encouraged to continue to seek psychological assistance.
56 I have also had regard to a court-ordered report prepared by Ms Brenda Hughes, a Senior Registered Nurse with the Mental Health Advice and Response Service of Forensicare, dated 4 March 2022.[15] You reported to her that your sessions with Ms Lee were ‘very valuable’. At the time of Ms Hughes’s report, she opined you rated your mood as 7/10 and you denied a diagnosis of depression. You reported your sleep was ‘erratic’ and your appetite ‘poor’ owing to your ‘legal issues’. There was no evidence of psychotic features and your judgment and insight appeared to be ‘grossly intact’. She concluded you are suffering from a mental health problem of moderate severity which requires ongoing mental health care.
[15] Ex C2.
57 Your senior counsel did not seek to rely on any aspect of R v Verdins[16] and I am satisfied no Verdins principles are engaged in your case.[17]
[16] (2007) 16 VR 269.
[17] Ibid 276 [32] (Maxwell P, Buchanan and Vincent JJA) (‘Verdins’). See also Brown v The Queen (2020) 62 VR 491.
58 Given you are the main breadwinner for your family, I accept that if you were imprisoned your concern for your wife and children would increase the burden of imprisonment on you.
59 The effects of the COVID-19 pandemic are relevant to sentencing because:
(a) An offender is a higher risk of contracting COVID–19 if they are incarcerated (presuming an outbreak in custody).[18]
[18] The Queen v Madex [2020] VSC 145 [52].
(b) As I previously observed, the inherent utilitarian value of a guilty plea is greater during the pandemic.[19]
(c) The pandemic is causing additional stress and concern for those incarcerated and their families, as it is for every member of the community.[20]
(d) The pandemic can impact on visits, work and educational opportunities, depending on the number of cases of COVID-19 in the community at any given time.
[19] DPP v Bourke [2020] VSC 130 [32].
[20] Brown v The Queen [2020] VSCA 60 [48].
60 However, there is no evidence before me to indicate you would suffer any particular additional custodial hardship over and above that of the average prisoner as a result of COVID–19.
Application of Sentencing Principles
61 I have had regard to current sentencing practice in relation to the charge of obtaining property by deception as informed by the decisions of the High Court of Australia in R v Kilic[21] and DPP (Vic) v Dalgliesh (a Pseudonym)[22] and the Victorian Court of Appeal decision in DPP v Zhuang.[23]
[21] (2016) 259 CLR 256, 266–8 [21]–[25] (Bell, Gageler, Keane, Nettle and Gordon JJ).
[22] (2017) 262 CLR 428 (Kiefel CJ, Bell, Gageler, Keane and Gordon JJ).
[23] (2015) 250 A Crim R 282, 292 [30]–[31] (Redlich, Priest and Beach JJA). See also Williams (a pseudonym) v The Queen [2021] VSCA 35 [21]–[[25] (Priest and Kyrou JJA) (‘Williams’).
62 While current sentencing practice is relevant to the sentence I impose on you, it is only one of a number of sentencing considerations I must take into account in imposing a just sentence in your case.[24]
[24] See DPP (Vic) v Dalgliesh (a Pseudonym) (2017) 262 CLR 428.
63 Moreover, it is always difficult to gauge more than a general yardstick from so-called ‘comparable cases’, given the wide range of offending conduct that can constitute the offence of obtaining property by deception and the myriad of personal circumstances pertaining to individual offenders. Nonetheless, to the extent I have been able to gain any assistance from so-called ‘comparable cases’, I have sought to do so in your case.
64 The basic purposes for which a court may impose a sentence are just punishment, deterrence, both specific and general, rehabilitation, denunciation and protection of the community. In sentencing you, I must have regard to a range of factors, such as the seriousness of the offence, your culpability for it, the impact of the offence on any victim, and your personal circumstances.
65 I am required to balance the interests of the community in denouncing criminal conduct with the interests of the community in seeking to ensure that, so far as is possible, you are rehabilitated and reintegrated into society.
66 Just punishment, denunciation and general deterrence are very important sentencing considerations in this case. I am of the view in your case I need give very little, if any weight, to specific deterrence or protection of the community. I accept you have learned a valuable lesson from your experience of the criminal justice system to date, and you are unlikely to reoffend in the future. As I said earlier, I consider you have excellent prospects for rehabilitation.
67 Your counsel submitted the imposition of a Community Correction Order (‘CCO’) with strict conditions would achieve all the purposes of sentencing in this case. The Director of Public Prosecutions accepts such a disposition is ‘within range’ in your case.
68 I had you assessed for suitability for a CCO and received an Assessment Outcome Report dated 25 February 2022.[25] You have been assessed as suitable for a CCO with an unpaid community work condition attached.[26] You were assessed as having a low risk of reoffending, however treatment and rehabilitation programs are recommended for your mental health condition and to reduce the risk of you reoffending.[27]
[25] Ex C1.
[26] Sentencing Act 1991 (‘SA’) s 48C.
[27]Ex C2.
69 The parsimony principle requires I not impose a sentence that involves your confinement unless I consider the purposes for which this sentence is imposed cannot be achieved by a CCO to which one or more of certain specified conditions are attached.[28]
[28] See SA s 5(4C).
70 As the Victoria Court of Appeal observed in Boulton v The Queen:[29]
It follows from what we have said that a CCO may be suitable even in cases of relatively serious offences which might previously have attracted a medium term of imprisonment (such as, for example, aggravated burglary, intentionally causing serious injury, some forms of sexual offences involving minors, some kinds of rape and some categories of homicide). The sentencing judge may find that, in view of the objective gravity of the conduct and the personal circumstances of the offender, a properly-conditioned CCO of lengthy duration is capable of satisfying the requirements of proportionality, parsimony and just punishment, while affording the best prospects for rehabilitation.[30]
[29] (2014) 46 VR 308.
[30] Ibid 338 [131] (Maxwell P, Nettle, Neave, Redlich and Osborn JJA).
71 After balancing all relevant sentencing considerations in this case, I consider a three year CCO with 500 hours of unpaid community work and a mental health treatment condition is the appropriate disposition necessary to achieve the purposes for which this sentence is imposed.[31]
[31] Ibid s 5(4).
Stand up Mr Gadd
On Charge 1 (obtaining property by deception) you are convicted and sentenced to a CCO for three years commencing today, with the following conditions:
Pursuant to s 48C of the Sentencing Act 1991 (‘the Act’) – you are to perform 500 hours of unpaid community work.
Pursuant to s 48CA of the Act – up to 100 hours satisfactorily undertaken for treatment and rehabilitation are to be counted as hours of unpaid community work for the purposes of the unpaid community work condition.
Pursuant to s 48D(3)(e) of the Act – there will be a mental health assessment and treatment condition.
Pursuant to s 48K of the Act – there will be a judicial monitoring condition. You are to attend a judicial monitoring hearing on Friday, 16 September 2022 at 9.45 am.
In accordance with s 6AAA of the Sentencing Act 1991, I declare that but for your plea of guilty, I would have sentenced you to two years’ imprisonment with a minimum non-parole period of 15 months.
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