Director of Public Prosecutions v Ip - [2005] ACTCA 24

DIRECTOR OF PUBLIC PROSECUTIONS v KA-HUNG IP
[2005] ACTCA 24 (19 July 2005)

CRIMINAL LAW – Crown appeal – sentencing – obtaining a financial advantage by deception – whether sentence manifestly inadequate – calculation of periodic detention.

Criminal Code Act 1995 (Cth), s 131, s 134
Proceeds of Crime Act 2002 (Cth), s 37
Crimes Act 1914 (Cth), s 16A, s 16BA, s 17A, s 20AB
Periodic Detention Act 1995 (ACT), s 4

R v Tait and Bartley (1979) 24 ALR 473
R v Reynolds [2004] NSWCCA 51
Weininger v The Queen (2003) 212 CLR 629

Moore v The Queen [1999] FCA 448
Murrell v R (1985) 4 FCR 168
R v Vougdis (1989) 41 A Crim R 125

Attorney General’s Application Under s 37 of the Crimes (Sentencing Procedure) Act 1999, No. 1 of 2002 (2002) 56 NSWLR 146
Craft v Diebert [2004] ACTCA 15

Dinsdale v The Queen (2000) 202 CLR 321

R v Mereana Otene-Waaka (unreported, ACTSC, 16 August 2000)

R v Hinton (2002) 134 A Crim R 286
R v Togias (2001) 127 A Crim R 23

No ACTCA 38-2004
No SC 182 of 2004

Judge: Higgins CJ, Gray and Madgwick JJ
Supreme Court of the ACT
Date: 19 July 2005

IN THE SUPREME COURT OF THE       )          No ACTCA 38-2004
  )          No SC 182 of 2004
AUSTRALIAN CAPITAL TERRITORY    )

BETWEEN:DIRECTOR OF PUBLIC PROSECUTIONS
Appellant

AND: KA-HUNG IP
Respondent

ORDER

Judges:  Higgins CJ, Gray and Madgwick JJ
Date:  3 May 2005
Place:  Canberra

THE COURT ORDERS THAT:

The appeal be allowed.
The number of periods of periodic detention be varied from 78 to 104, commencing on 5 November 2004.

IN THE SUPREME COURT OF THE       )          No ACTCA 38-2004
  )          No SC 182 of 2004
AUSTRALIAN CAPITAL TERRITORY    )

BETWEEN:DIRECTOR OF PUBLIC PROSECUTIONS
Appellant

AND: KA-HUNG IP
Respondent

Judges:  Higgins CJ, Gray and Madgwick JJ
Date:  19 July 2005
Place:  Canberra

REASONS FOR JUDGMENT

THE COURT:

This was an appeal by the Director of Public Prosecutions against a sentence imposed by a judge of this Court on 2 November 2004 for the offence of obtaining a financial advantage by deception under s 134.2 of the Criminal Code Act 1995 (Cth). The parties had asked his Honour to take into account a ‘scheduled’ offence of contravening a restraining order made under the Proceeds of Crime Act 2002 (Cth). His Honour’s order was that the respondent be sentenced to a custodial term of imprisonment of two years with the respondent to serve the sentence by way of 78 weekly periods of detention. The maximum penalty for the offence was imprisonment for 10 years.
On 3 May 2005, upon conclusion of the hearing of the appeal, the Court pronounced its decision, upholding the appeal and varying the number of periods of periodic detention from 78 to 104. The reasons for that decision now follow.

The Respondent’s offence

The respondent held a senior position of ‘Director, Finance’ in the National Archives of Australia (‘NAA’). In late October/November 2002, he persuaded his employer to outsource accounting data processing activities, caused the normal, prudential tendering and contracting processes to be bypassed, and negotiated a contract with a service provider called 3I Consulting Pty Ltd (‘the company’).
The respondent and his wife had, in about September 2001, set up the company and were its only directors and joint controllers of the company’s resources. The company’s principal place of business was the residential address of the respondent and his wife. At no stage was any of this disclosed to the NAA, contact with the company being made through ‘Victor Seng’, a fictitious alter ego of the respondent.
Not content with dishonestly and preferentially obtaining the contract, the respondent arranged for the entire amount of the original contract remuneration ($1.5 million) to be prepaid to the company: he relied on a forged audit report as proof that the financial position of the company was sound. He also arranged for the deletion of a clause in the draft contract requiring the company to provide a bank guarantee to cover the prepaid amount.
The contract also specified that all prices were inclusive of goods and services tax (‘GST’), however the invoice that was ultimately issued by the company and, under the respondent’s authority, paid, was for $1.65 million, being $1.5 million plus GST.
In October 2003, the respondent, again through underhand machinations, brought about a variation of the contract to add debt recovery services at a cost of $275,000 inclusive of GST, which was again prepaid to the company.
The company provided some services to the NAA before the respondent’s conduct was discovered.
Upon being challenged, the respondent initially claimed, falsely, that the company was his wife’s business, that he was not involved in the daily operations of the company, nor did he administer the contract for the NAA, and that he had declared his interest in it to another employee at the NAA (relying on a forged email to that effect). However, the respondent subsequently made an early plea of guilty to the charge of obtaining a financial advantage by deception, and, on 19 March 2004 and 19 October 2004, repaid what in substance represented all the contract monies received by the company, plus interest.

The offence taken into account

On 30 August 2004, subsequent to the respondent being charged with the substantive offence, he contravened a restraining order against him that had been made under the Proceeds of Crime Act 2002 (Cth), withdrawing $490,228 from two mortgage bank accounts and depositing $420,000 of that money into a Hong Kong bank account belonging to his sister-in-law. This conduct constituted the listed or ‘scheduled’ offence which had been charged under s 37 of the Proceeds of Crime Act 2002 (Cth). The maximum penalty prescribed for that offence was ‘imprisonment for 5 years or 300 penalty units, or both’. Again, soon after the conduct was discovered, the respondent arranged for the funds to be re-credited to the mortgage accounts on 5 October 2004 and at a very early stage admitted his guilt. He had initially alleged that he believed he was entitled to do what he did upon his mistaken belief that the restraining order had been lifted. There was, however, no evidence to suggest the possibility of any such belief being reasonably or honestly held.

Relevant Legislative Provisions

The statutory matters to which the Court must have regard when passing sentence are set out in s 16A of the Crimes Act 1914 (Cth) as follows:
(2) In addition to any other matters, the court must take into account such of the following matters as are relevant and known to the court:
(a)the nature and circumstances of the offence;
(b)other offences (if any) that are required or permitted to be taken into account;
(c)if the offence forms part of a course of conduct consisting of a series of criminal acts of the same or a similar character—that course of conduct;
(d)the personal circumstances of any victim of the offence;
(e)any injury, loss or damage resulting from the offence;
(f)the degree to which the person has shown contrition for the offence:
(i)by taking action to make reparation for any injury, loss or damage resulting from the offence; or
(ii)in any other manner;
(g)if the person has pleaded guilty to the charge in respect of the offence—that fact;
(h)the degree to which the person has co-operated with law enforcement agencies in the investigation of the offence or of other offences;
(j)the deterrent effect that any sentence or order under consideration may have on the person;
(k)the need to ensure that the person is adequately punished for the offence;
(m)the character, antecedents, cultural background, age, means and physical or mental condition of the person;
(n)the prospect of rehabilitation of the person;
(p)the probable effect that any sentence or order under consideration would have on any of the person's family or dependants.
In addition, s 16BA of the Crimes Act 1914 (Cth) provides a procedure that allows certain other offences to be taken into account for convictions in respect of which guilt is admitted but there has been no trial. Section 16BA provides:
Taking other offences into account
(1)Where a person is convicted of a federal offence or federal offences, and the court before which the person is convicted is satisfied that:
(a)there has been filed in the court a document … for the purposes of this section;
(b)the document contains a list of other federal offences … which the person convicted is believed to have committed;
…
(e)in all the circumstances it is proper to do so;
the court may, with the consent of the prosecutor and before passing sentence on the person, ask him whether he admits his guilt in respect of all or any of the offences specified in the list and wishes them to be taken into account by the court in passing sentence on him for the offence or offences of which he has been convicted.
(2)Subject to subsection (3), if the person admits his guilt in respect of all or any of the offences specified in the list and wishes to have them taken into account by the court in passing sentence on him for the offence or offences of which he has been convicted, the court may, if it thinks fit, in passing sentence on him for the offence or offences of which he has been convicted, take into account all or any of the offences in respect of which the person has admitted his guilt.
…
(4)Where the court takes into account under this section all or any of the offences in respect of which the person has admitted his guilt, the sentence passed on him for any of the offences of which he has been convicted shall not exceed the maximum penalty that the court would have been empowered to impose on him for the offence if no offence had been so taken into account.
…
(8)Where an offence is taken into account under this section, the court shall certify, upon the document filed in the court, the offence taken into account and the conviction or convictions in respect of which the offence was taken into account and thereafter no proceedings shall be taken or continued in respect of the offence unless the conviction or each conviction, as the case may be, in respect of which the offence has been taken into account has been quashed or set aside.
(9)An admission of guilt made under and for the purposes of this section is not admissible in evidence in any proceedings taken or continued in respect of the offence in respect of which the admission was made or in respect of any other offence specified in the list contained in the document filed in the court.
(10)An offence taken into account under this section shall not, by reason of its so being taken into account, be regarded for any purpose as an offence of which a person has been convicted.
…
Section 17A provides that:
(1)A court shall not pass a sentence of imprisonment on any person for a federal offence … unless the court, after having considered all other available sentences, is satisfied that no other sentence is appropriate in all the circumstances of the case.
Also relevant to the present appeal is s 4(1) of the Periodic Detention Act 1995 (ACT), which permits a sentencing court to order that persons who are convicted of an offence and sentenced to a term of imprisonment of not less than three months, but not more than 24 months, should serve such sentence by way of periodic detention. Section 4(2) of the Periodic Detention Act 1995 (ACT) provides:
The number of detention periods that a person may be required to serve under an order shall be calculated at the rate of 1 detention period for each week of the term of imprisonment to which the person would otherwise have been sentenced.
That provision is applied to persons being sentenced for federal offences by s 20AB of the Crimes Act 1914 (Cth) (set out in [53]).

The decision of the sentencing judge

The learned sentencing Judge was in no doubt that this was a serious offence. However, his Honour characterised the case as one of the respondent’s having abused his position of trust rather than stealing money from the Commonwealth. His Honour stated that this was ‘something less than straight out theft’ but considered nonetheless ‘that cases of substantial dishonesty by persons in positions of authority … require substantial deterrence’ and condign punishment.
As to the respondent’s very early guilty plea, his Honour said that, although it was inappropriate to state with precision what would have been the higher sentence imposed but for the guilty plea, and therefore to state with precision the discount to which the respondent was entitled as a result, it could be said that the sentence would have been ‘nothing but a substantial period of full-time custody’.
It is apparent that, throughout the sentencing hearings (which were conducted in two stages, so as to allow submissions on precise sentencing options after the trial Judge had indicated a preliminary view), his Honour took a number of matters into account:
·The respondent’s subsequent conduct, namely the offence relating to the drawing down of a substantial sum of money contrary to Court orders, was expressly considered.
·As to the respondent’s prior good character, his Honour affirmed a proposition, said to be supported by a number of State appellate courts (see Brian Roy Davies (1996) 88 A Crim R 226; R v Dubois (2004) 88 SASR 304; Brian Thomas Burke (1994 75 A Crim R 48), that it is ‘difficult to expressly apply a discount’ for that factor in major fraud cases, because people with prior offences of dishonesty would never be in a position where they could commit major fraud. However, his Honour later indicated that he had taken into account the references provided in support of the respondent as indicating that the respondent’s offence was very much aberrant behaviour.
·The impact the conviction will have on the respondent’s lifestyle, in that he will never again hold either a senior position in a Commonwealth agency, or a position with any financial responsibility; later, his Honour said that he had taken into account ‘the additional cost to [the respondent] beyond the actual period of periodic detention’, in that the respondent’s ‘future career options are seriously limited’.
·It was not correct, his Honour said, ‘to say that there was criminality in the sum of $1.925 million in the sense that that was the total loss.’ His Honour later said:
…nonetheless, there is a degree of criminality that the court must recognise and must punish. It’s not the actual dollar sum of the loss, but the fact that a person in a position of trust abuses and perverts the tender process and awards a lucrative and remunerative tender to an entity controlled by himself and other members of his family rather than to an outside agency or body that won the tender in a fair fight.
·His Honour also addressed the probable effect that any sentence under consideration would have on the respondent’s family or dependants. In this regard, the need of the respondent’s wife for intimate personal assistance to manage her very severe dermatological illness was taken into account.
His Honour concluded, at the close of the first day’s hearing, as follows:
It seems to me the appropriate disposition of this case would be, and I intend in effect to give a sentence here and then invite submission from counsel as to where we go, would be a sentence of two years’ imprisonment which I would order if I were to direct it to be served in the ordinary way that he be released after serving [18] months.
The effect of that is twofold. One is that as I would impose a maximum penalty of 24 months but to direct that he be released after serving [18] months, periodic detention would be an available option. Equally, having indicated that sentence, it would also follow that home detention would be an available option.
Later, after receiving further submissions, his Honour said:
…I, on the last occasion, gave an indication of what I would have imposed by way of a sentence, which … would have resulted in a release at 18 months, which would have allowed for both options of [home detention and periodic detention]. It would seem to me, but I’d invite submissions from either of you on this, that as the indication would have been for release at 18 months, that would be the appropriate point to impose periodic detention.
Counsel for the appellant responded as follows:
…it seems to us that periodic detention is not available unless your Honour can be satisfied that it would be appropriate to sentence the offender to two years, … the Crown, with respect, submits that such a sentence of two years would be outside the – would be too low and outside the range of appropriate head sentences.
…
But leaving that aside, … your Honour’s reasoning, in terms of how to calculate the period of periodic detention, seems to us to be sound, with respect.
Counsel for the respondent did not wish to be further heard.
Giving his reasons, his Honour later said:
The nature of the arrangement was that it was a tender where the price was paid up front by the Commonwealth uniquely and not supported by a bond, and there had been also some contract variations resulting in additional monies paid over. It seems to me that I can take from that that, had the dishonesty not been detected, the scheme would have run its course and over time more services would have been provided, to the point that the contract was eventually fulfilled.
So this is less than outright theft. Outright theft and fraud of the quantum involved would undoubtedly have required a longer period of full-time imprisonment. To the extent that the Crown on the last occasion submitted that these offences warranted that, I was against the Crown on those submissions and favoured the submissions made by [counsel for the respondent]. Having indicated on the last occasion that that was my indicative range we adjourned proceedings to allow some exploration to be made of alternatives to full-time imprisonment.

After discussing the alternatives of periodic detention or home detention, his Honour determined that periodic detention was ‘entirely appropriate’. Repeating the earlier indication ‘that the indicative sentence if [his Honour were] to proceed by way of full-time imprisonment would have been such that [the respondent] would have been released, albeit on parole and subject to conditions, after 18 months’, the sentencing Judge said:
…absent any submissions to the contrary and there being none from either [counsel for the respondent] or [counsel] for the Commonwealth, the appropriate [starting] point …would be to impose periodic detention for the equivalent period, that is to say, 18 months. A sentence of periodic detention is imposed by way of a number of periods because it relates to weekends and that amounts, in my calculations, to 78 periods of periodic detention.

The Current Appeal

The Court gave leave to the appellant at the hearing to amend the notice of appeal, so that the appellant ultimately asserted that the sentencing Judge erred by:
(a)imposing a manifestly inadequate sentence;
(b)finding that a head sentence of two years was adequate, given the overall criminality and the nature and seriousness of the offending;
(c)having regard to the fact that periodic detention was unavailable if a sentence of greater than 24 months was imposed, in arriving at the head sentence of two years;
(d)finding that the offence was less serious than an offence involving the theft of property by an employee;
(e)giving undue weight to the fact that there were some services provided under the contract, and failing to give weight to the role of the respondent in causing the outsourcing of the contract in the first place;
(f)not taking into account, or giving sufficient weight to the matter on the schedule under s 16BA of the Crimes Act 1914 (Cth); and
(g)fixing a periodic detention period of 18 months pursuant to s 4(2) of the Periodic Detention Act 1995 (ACT).

Submissions

Essentially, the appellant submitted that the head sentence of two years’ imprisonment was manifestly inadequate in the circumstances, and that a head sentence of not less than four years’ imprisonment would have been appropriate. Following the principle that an appellate court will only interfere with a sentence if it be shown that the sentencing Judge was in error in acting on a wrong principle or misunderstanding or in wrongly assessing evidence (R v Tait and Bartley (1979) 24 ALR 473), the appellant argued, in summary, that the sentencing Judge had failed fully to appreciate the seriousness of the offence.
26.Developing the seriousness of the offence, the appellant pointed out that it involved:
(i)a serious breach of trust by a senior officer, betraying a responsible financial position;
(ii)dishonest dealing with public funds;
(iii)misuse of a substantial amount totalling $1,925,000; and
(iv)the respondent’s involvement of a number of staff at the NAA as ‘innocent dupes to assist his scheme’.
The appellant also pointed to aggravating circumstances of the offence: the use of a false name to conceal the true identity of those behind the company; the use of false audit reports and emails; the belated additional dishonesty, whereby the respondent included an amount of $150,000 for GST on the invoice to be paid to the company, even though that was not required by the contract, and in any event was not paid to the Australian Taxation Office; the fact that the respondent himself performed some of the duties outsourced to the company in the course of his employment by the NAA and using its own resources; and finally, the respondent’s conduct subsequent to the guilty plea, in that he transferred funds that were the subject of the restraining order to a Hong Kong bank account.
Further, the appellant submitted that his Honour had first determined that something less than full-time imprisonment was appropriate as the ultimate disposition, and then arrived at a head sentence low enough to allow less onerous sentencing options.
Next, it was argued that his Honour failed to take sufficient account of the subsequent listed offence.
As to the respondent’s plea of guilty, the appellant submitted that it came in the face of an overwhelmingly strong case.
The appellant submitted that too much weight was given to the effect a custodial sentence would have on the respondent’s dependants under s 16A(2)(p) of the Crimes Act 1914 (Cth), in that any medical treatment required by the respondent’s wife could be provided by health care professionals.
The respondent reminded us that specific error alone is not sufficient to warrant upholding a Crown appeal; the Crown must go further and show that (possibly in the light of, or as a result of, the error) a manifestly inadequate sentence was imposed: R v Reynolds [2004] NSWCCA 51 at [23], per Simpson J, Levine and Barr JJ agreeing. The respondent pointed to the sentencing Judge’s statement that, but for the ‘very early plea of guilty,’ there would have been ‘a substantial period of full-time custody’, arguing that his Honour was entirely justified in accordingly reducing the sentence substantially. It was also, correctly, submitted that matters of aggravation must be proved beyond reasonable doubt: Weininger v The Queen (2003) 212 CLR 629 at [18] – [19]. His Honour, it was said, could not be satisfied beyond reasonable doubt that it was unnecessary for the NAA to outsource the work it contracted the company to perform, nor could it have been satisfied beyond reasonable doubt that the company would have never been the successful tenderer.
The respondent also submitted that it could not be assumed from his Honour’s mere silence on any given point that, as an experienced sentencer, he had not given appropriate consideration to that point: Moore v The Queen [1999] FCA 448 at [58].
In response to the submission that the sentencing Judge had ‘retro-fitted’ the head sentence so as to make periodic detention available, the respondent submitted that his Honour had first indicated a sentence of two years’ imprisonment, with a non-parole period, and then noted that consequently both periodic detention and home detention were potentially available options as alternatives to service of the sentence in full-time custody (referring to the passage quoted in [18] above).
Addressing the contention that the sentencing Judge erred in finding that the offence was ‘less than outright theft’, the respondent argued that his Honour’s remark must be read in context: his Honour acknowledged that the offence was ‘a dishonest scheme’ and commented that there was ‘no question this is a serious offence’ requiring ‘the court to express a strong view in relation to general deterrence and specific deterrence’.
In terms of the scheduled offence and the allegation that the sentencing Judge gave insufficient weight to that matter, the respondent relied on Murrell v R (1985) 4 FCR 168 at 176, and R vVougdis (1989) 41 A Crim R 125 at 128 – 129. There it was said that offences to be taken into account should be dealt with so as to ensure that ‘… by making sentences concurrent or by other means … the whole period of imprisonment is one which best meets the situation.’ This somewhat unhelpful statement was referred to as nevertheless reflecting ‘the discretionary nature of the sentencing task’ in Attorney General’s Application Under s 37 of the Crimes (Sentencing Procedure) Act 1999, No. 1 of 2002 (2002) 56 NSWLR 146 (‘Attorney General’s Application’). The respondent further referred to the observation of Spigelman CJ in that case (at 159) that ‘it will rarely be appropriate for a sentencing judge to attempt to quantify the effect on the sentence of taking into account [a scheduled offence].’

Consideration

As is well-settled, the row of the appellant in a Crown appeal against sentence is not easy to hoe. In the first place, as the Full Court of the Federal Court said in R v Tait and Bartley at 476:
An appellate court does not interfere with the sentence imposed merely because it is of the view that that sentence is insufficient or excessive. It interferes only if it be shown that the sentencing judge was in error in acting on a wrong principle or in misunderstanding or in wrongly assessing some salient feature of the evidence. The error may appear in what the sentencing judge said in the proceedings, or the sentence itself may be so excessive or inadequate as to manifest such error (see generally, Skinner v R (1913) 16 CLR 336 at 339-40; R v Withers (1925) 25 SR (NSW) 382 at 394; Whittaker v R (1928) 41 CLR 230 at 249; Griffiths v R (1977) 15 ALR 1 at 15-17).

In the second place, to provoke actual intervention by the appellate court, even if some specific error can be pointed to, it is necessary to show that the error has resulted in a sentence that is manifestly inadequate. Speaking for the NSW Court of Criminal Appeal in R v Reynolds, Simpson J said:
23 It has long been established that a Crown appeal will be upheld only if the sentence imposed is manifestly inadequate. Manifest inadequacy may be demonstrated merely be reference to the length of the sentence itself; R v Whittaker (1928) 41 CLR 230; R v Cranssen (1936) 55 CLR 509 at 519-20. The task of the Court of Criminal Appeal in exercising power under s5D is to determine whether error has been made in the sentencing process: Dinsdale v R [2000] HCA 54; 202 CLR 321. This is an application of the principles stated in House v R (1936) 55 CLR 499 at 505. Error of the House variety may, as has been stated, be demonstrated by reference to the sentence itself, or by reference to the judge’s stated reasoning process which may expose the application of a wrong principle, the taking into account of extraneous or irrelevant matters, the omission of some material consideration, or a misapprehension of the facts: Dinsdale [3].
24 … a submission made on behalf of the respondent … was that the only ground of appeal against the claimed inadequacy of a sentence available to the Crown is the ground that the sentence is manifestly inadequate. It is not, the argument ran, open to the Crown to point to some error of fact or law or procedure, and claim that that error would itself open the way to this Court to re-sentence. If I understand the submission correctly, it was to the effect that specific alleged errors to which the Crown pointed, even if established, will not bring about the success of the Crown appeal unless the Crown also establishes that the end result - the sentence imposed - was manifestly inadequate. The logical conclusion of that argument is that specific error is irrelevant in a Crown appeal.
25 The submission does not sit easily with the terms of s5D(1), and sits even less easily with the judgment of Gleeson CJ and Hayne J in Dinsdale. Their Honours wrote:
The task of the Court of Criminal Appeal was to determine whether there was error made in sentencing the accused... (at [3])
Their Honours explained “error” by quoting the well-known passage from House, and held that those principles apply both to Crown appeals based upon alleged inadequacy, and to appeals by offenders based upon alleged excessiveness (at [4]). Gaudron and Gummow JJ, in a second joint judgment (at [21]) and Kirby J separately (at [58]) all took a similar view.
(Dinsdale was on appeal from the Supreme Court of Western Australia, but the section there under consideration was not materially different from s5D(1).)
26 I am satisfied, however, that counsel for the respondent is correct in his contention that the ultimate question is whether the sentence has been shown to be manifestly inadequate. That does not exclude the identification of specific error, where it can be shown, that may explain how manifest inadequacy came about. Identification of specific error alone is not sufficient to warrant upholding a Crown appeal; the Crown must go further and show that (possibly in the light of, or as a result of, the error) a manifestly inadequate sentence was imposed.

We consider first the argument that the sentencing Judge did not follow the appropriate conceptual steps in arriving at the head sentence of two years. The Court’s attention was drawn to Craft v Diebert [2004] ACTCA 15, where Crispin P and Connolly J said at [5]:
First, the sentencing judge or magistrate must begin by determining the appropriate sentence for the offence, having regard to the purposes for which sentences may be imposed … and the matters which must be taken into account … but without taking into account the possibility of a sentence of periodic detention … or a sentence of home detention ….

There is no doubt that this is the correct procedure. In the present case, although his Honour did not expressly indicate that he was engaged in such a two-stage process, and despite some passages that can, read alone, be regarded as giving some support to the appellant’s submissions, we do not think that his Honour erred, in the way suggested. In Dinsdale v R [2000] HCA 54; 202 CLR 321 at [39] Kirby J pointed out that:
Sentencing remarks should not be read in isolation. Ordinarily, … they respond to the submissions that are made.
In that light, it seems to us that his Honour was not doing other than arriving at the head sentence he considered appropriate in the light of a degree of acceptance of the submissions made to him for the appellant, and then turning to examine the practicalities, having regard to the respondent’s submissions, as a result of his Honour’s determination that two years’ imprisonment was appropriate.
Turning to consider the adequacy of the sentence and any error attending that adequacy, it is plain that the sentencing Judge looked carefully at the whole of the case, and thoroughly and expressly considered the numerous factors he took into account in arriving at the head sentence. Nevertheless, with respect, in his Honour’s comments there is no acknowledgement of the fact that there was a direct and unarguable loss to the Commonwealth. Further, an appropriation by the respondent of the GST money, a matter properly to be taken into account, might possibly be thought to elevate the offence to a case of what in plain language would be called outright theft. However, in our view, the better assessment is that it is not relevant whether conduct charged as being the dishonest obtaining of a financial advantage from a Commonwealth entity (s 134.2) also amounts to ‘theft’ from that entity: both offences carry the same maximum penalty (cf. s 131.1(1) Criminal Code Act 1995 (Cth)), and some thefts may exhibit less criminality than some offences of dishonestly obtaining a financial advantage or vice versa. In any case, his Honour did not address the extent of the financial advantage dishonestly received by the respondent, and it must be the case that the extent of that advantage was in excess of $300,000.
It may also be said that, whether or not the company would have fulfilled its obligations under the contract, given the evidence that the debt recovery services were at least partially performed by the respondent using NAA resources and time, was a question relevant only as one of aggravation if the services had not been performed at all, rather than as mitigation.
Quite apart from these apparent, specific errors, in our view the material head sentence fixed on by his Honour was itself such as to bespeak error. The offence involved:
·a sustained, complex and large-scale fraud,
·attended by multiple instances of contributory dishonesty,
·perpetrated by a senior officer, a man of mature years with the benefit of tertiary education,
·breaches of trust by a person, part of whose obligation was to see that contracts for the performance of services for the NAA were honestly, prudentially and fairly awarded and supervised,
·a high degree of criminality: the respondent was responsible for numerous instances of deception and dishonest departure from trust that led to the obtaining of the ultimate advantage, as well as the further crime committed just after his plea of guilty,
·greed, not need, as the motivation for the offence.
Further, it was a matter of distinct (though not great) aggravation that the respondent committed the scheduled offence which, in our view, his Honour was obliged fully to take into account.
Notwithstanding the strong subjective features of the appellant’s case (further touched on below), we consider that the lower limit of an acceptable range of head sentences would have been three years’ imprisonment.
As to a ‘scheduled offence’, the requirement of Parliament under s 16BA(2) is that the Court must exercise a discretion to take it into account in sentencing for the primary offence or to decline to do so, and if the Court determines that it is appropriate, it should ‘take [it] into account’.
Possibilities of abuse attend this procedure. A person being sentenced may hope to gain some commendatory advantage from a law enforcement officer by augmenting that officer’s or his/her organisation’s tally of crimes solved. Or, the prospect of offence B being ‘scheduled’ may produce a guilty plea in relation to offence A, where one would otherwise not be forthcoming. In particular cases, that may or may not be appropriate. Thus, it is proper that the judicial discretion should be actively and carefully considered. It is such considerations that Spigelman CJ likely had in mind in Attorney General’s Application, when, speaking for the NSW Court of Criminal Appeal, he said (at [65] – [67]):
… Law enforcement agencies and even courts may receive a perceived organisational benefit from increased disposal rates, but such institutional advantages should not be confused with the public interest.
The effect of inclusion on a Form 1 is to give the offences so included a significantly lower salience in the sentencing process. There will be an obvious advantage, and hence a greater incentive to admit guilt, where the Form 1 procedure is employed. In my opinion, the issues that arise are broadly equivalent to those involved in the Crown deciding not to prosecute for the full range of offences open to it or to accept a plea to a lesser charge, albeit in the context of multiple, and often divergent, criminal offences.
By reason of the express statutory power, a sentencing judge must assess whether it is appropriate to proceed to sentence on a basis where no separate penalty is to be imposed for admitted offences. There will be cases in which, for example, the administration of justice could be brought into disrepute by the court proceeding to sentence a person guilty of a course of criminal conduct on a manifestly inadequate, unduly narrow or artificial basis. I do not intend the previous sentence to constitute a comprehensive statement of the circumstances in which the broad discretion vested in the sentencing judge by s 33(1)(b) can be exercised. Nevertheless, the role of the Court must be constrained, to ensure that the independence of the judicial office in an adversary system is protected. (Cf Maxwell v The Queen (1995) 184 CLR 501 at 513-514 and 534-535.
There is, we hasten to say, no question of any kind of impropriety in the offence listed having been scheduled here and his Honour was right to take it into account: it was related by subject matter and by time to the criminality exhibited in the primary offence charged. Both offences concerned less than careful dealings in relation to financial matters.
Where the sentencer decides to take the listed matter into account, the matter must really and substantially, that is to say fully, be taken into account, even though, as Attorney General’s Application makes clear, it is only the principal offence (and only its maximum available sentence) in relation to which sentence is being passed.
The listed matter ought to have been taken into account as a matter, in substance, of a degree of aggravation: its effect must have been to diminish the credit otherwise due to the respondent for his early plea of guilty, and his substantial restitution of what had passed from or been lost to the NAA. It is not apparent that his Honour made any discrete error as to this matter, but the above considerations are, with others, pertinent to the question whether the notional head sentence and, derivatively, the actual orders determined by his Honour were manifestly inadequate.
Turning to consider the periodic detention sentencing option imposed by his Honour, it is clear enough that, on any view of the appropriateness of his Honour’s notional head sentence, the supposed ‘non-parole’ period of 18 months was not the appropriate measure for calculating the amount of periodic detention to be served.
In relation to ACT, as distinct from Commonwealth, offences, the ‘term of imprisonment’ clearly means what, in a non-periodic detention setting, would be the head sentence. When a non-parole period or recognisance release order is made, the term of imprisonment to which the person has been sentenced is that term which he or she is liable to serve, namely the head sentence where a non-parole period is fixed or, in the case of a recognisance release order, the sentence that would be served if no such order were made. That the person sentenced will (in the case of a recognisance release order) or may (in the case of a non-parole period) be released early is not to the point. In R v Mereana Otene-Waaka (unreported, ACTSC, 16 August 2000), Madgwick J so held.
The position is, however, not quite so simple for Commonwealth offences. Section 20AB of the Crimes Act 1914 (Cth) provides:
20ABAdditional sentencing alternatives
(1)Where under the law of a participating State or a participating Territory a court is empowered in particular cases to pass a sentence or make an order known as a community service order, a work order, a sentence of periodic detention, an attendance centre order, a sentence of weekend detention or an attendance order, or to pass or make a similar sentence or order or a sentence or order that is prescribed for the purposes of this section, in respect of a State or Territory offender, such a sentence or order may in corresponding cases be passed or made by that court or any federal court in respect of a person convicted before that first-mentioned court, or before that federal court in that State or Territory, of a federal offence.
(1A) Where the law of a participating State or a participating Territory requires that before passing a sentence, or making an order, of the kind referred to in subsection (1) a court must first pass another sentence or make another order (whether or not that other sentence or other order is suspended upon the making of the first-mentioned sentence or order), then, a court is not required, before passing or making that first-mentioned sentence or order in respect of a person convicted by that court for a federal offence, to pass that other sentence or make that other order.
…
(3)Where a sentence or order referred to in subsection (1) is passed or made under that subsection in respect of a person convicted in a State or Territory of a federal offence, the provisions of the laws of the State or Territory with respect to such a sentence or order that is passed or made under those laws shall, so far as those provisions are capable of application and are not inconsistent with the laws of the Commonwealth, apply, by virtue of this subsection, to and in relation to the sentence or order passed or made under subsection (1).

The Periodic Detention Act 1995 (ACT) does not require that an ACT Court ‘must first pass another sentence’ before making a periodic detention order, so that s 20AB(1A) of the Crimes Act 1914 (Cth) is not engaged.
Section 19AB of the Crimes Act 1914 (Cth) requires the Court, in general, to fix a non-parole period or make a recognisance release order, where (but only where) a federal sentence of imprisonment is imposed. Although subsections 4(2) and (3) of the Periodic Detention Act 1995 (ACT) specify that:
… the number of detention periods that a person may be required to serve under an order shall be calculated at the rate of 1 detention period for each week of the term of imprisonment to which the person would otherwise have been sentenced,
ex hypothesi the periodic detention order is made ‘instead of’ sentencing the person to imprisonment. Thus, there is no inconsistency with the Commonwealth law. On the assumption that the respondent may have been granted parole at the earliest opportunity, he may have only served 18 months of the notional two year term. However, that does not change the position taken by the sentencing judge that he would have been sentenced to two years’ imprisonment.
It is unfortunate that, when the trial Judge sought assistance from counsel in this regard, neither drew his Honour’s attention to the specific terms of the relevant statutes, as may be seen from the exchanges set out in [19] – [21] above. Nevertheless, an unwitting contravention of s 4(2) of the Periodic Detention Act by his Honour’s approach has been exposed. At the hearing before us, counsel for the respondent rightly conceded that the amount of periodic detention that was imposed, if his Honour’s view that a two year head sentence of imprisonment would have been appropriate was correct, should have been the equivalent of two years, that is 104 periods.
Thus, in principle, for these two basic reasons, namely manifest inadequacy and technical error as to the Periodic Detention Act, the appeal ought to be upheld.
The question then arises what, if anything, this Court should do by way of re-sentencing.
The respondent’s wife suffers from an unusual skin disease that is both chronic and acute. She is quite extraordinarily needy of the respondent’s personal assistance to her. For cultural reasons there are difficulties in substituting the assistance of health professionals for that of the respondent.
The mandate of the Commonwealth Parliament is quite clear: the sentencing court ‘must take into account’ the matters set out in subs 16A(2) of the Crimes Act 1914 (Cth), including ‘(p) the probable effect that any sentence or order under consideration would have on any of the person’s family or dependants’. The contemplated taking into account of such factors must clearly be real and must occur in every case in which one or more of those factors exist. There is, with respect, simply no warrant for a sentencing court to presume judicially to qualify the clear parliamentary command by suggesting, as has been done, in R v Hinton (2002) 134 A Crim R 286, 293, that –
The reference in s 16A(2)(p) of the Crimes Act 1914 (Cth) to the “probable effect that any sentence or order under consideration would have on any of the person’s family or dependants” should be read as if it were [preceded] by the words “in an exceptional case”: R v Togias (2001) 127 A Crim R 23.
Indeed, this court would wish to specifically dissociate itself from the reasoning in R v Togias which gave rise to that suggestion (see Togias (supra) at 34-37). As R v Hinton stresses, each case will “to a very great degree depend upon its own facts”. So here.
Of course, what weight a listed factor is to be given is a discretionary matter. In many cases, it will not be possible to give a family’s suffering much or any weight. But as a matter of the letter and the clear conceptual intendment of the Parliament, it must be anxiously considered in every case where it exists.
Similar considerations are true, contrary to a view apparently expressed and relied on by his Honour (see [17] above) in relation to the question of previous good character in white collar fraud cases; character is a matter specifically adverted to in s 16A(2)(m). For our part, we see no inconsistency in regarding the respondent’s breach of trust as a circumstance of aggravation, while also regarding his excellent prior good character as a mitigating circumstance, even though it contributed to his having the opportunity to commit the breaches of trust inherent in the offence charged. It is not unknown for persons of previous bad character, through further dishonesty, to gain positions of trust and then to criminally abuse them. The respondent’s criminality involved no such thing. Nor should his generally law-abiding disposition be forgotten. We do not understand the authorities noted by his Honour to be in conflict with the views just expressed.
Further, this court cannot overlook the fact that the respondent’s periodic detention order has now been under implementation for six months, during which time he has been able to give his wife the personal care she needs. He has also constructively set about his employment rehabilitation.
Very properly, recognising the necessity for appellate restraint when considering re-sentencing on a justified Crown appeal, and from the application of what one might call principled compassion in what is an appropriate case for it, the Director did not press us to do more than to deal with the adequacy of the term of imprisonment, to endorse the necessity in principle that it should have been ordered to be served in a way more onerous than periodic detention, and to vary the sentence only in relation to the number of periods of periodic detention to be served. This, as we have said, would involve increasing that number from 78 to 104.
We consider that that is the correct course to follow.

Disposition

The appeal is upheld. The periodic detention order made by the sentencing judge will be varied by requiring that the appellant serve 104 rather than 78 periods of periodic detention, credit being given for periods served.
I certify that the preceding sixty-six (66) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court.
Associate:
Date: 19 July 2005

Counsel for the appellant: Mr Bugg QC

Solicitor for the appellant: Commonwealth Director of Public Prosecutions

Counsel for the respondent: Mr C Everson

Solicitor for the respondent: Elrington Boardman Allport Lawyers

Date of hearing: 3 May 2005

Date of judgment: 19 July 2005