Director of Public Prosecutions v Morton

[2019] VCC 342

IN THE COUNTY COURT OF VICTORIA Revised
Not Restricted
 Suitable for Publication

AT MELBOURNE
CRIMINAL JURISDICTION

CR 17-02461

DIRECTOR OF PUBLIC PROSECUTIONS

v

DIANE MORTON

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JUDGE:	HIS HONOUR JUDGE CARMODY
WHERE HELD:	Melbourne
DATE OF HEARING:	21 March 2019
DATE OF SENTENCE:	21 March 2019
CASE MAY BE CITED AS:	DPP v Morton
MEDIUM NEUTRAL CITATION:	[2019] VCC 342

REASONS FOR SENTENCE
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Subject:  CRIMINAL LAW
Catchwords:  Theft

Sentence:Total effective sentence is three years and three months imprisonment with a non-parole period of two years and three months imprisonment before being eligible for parole.

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APPEARANCES:	Counsel	Solicitors
For the Director of Public Prosecutions	Ms S Lenthall	Director of Public Prosecutions
For the Accused	Mr J Marquis	David Bullard

HIS HONOUR:

1Diane Morton, on 29 November 2018 at the Latrobe Valley County Court, you pleaded guilty to four charges on indictment No.G13164541.1. Those charges were:

Charge 1, between 1 July 2009 and 31 May 2014, you stole cash money from Lardner Mechanical Repairs.  This is a course of conduct charge and the theft totalled to the sum of $309,553.38; 

Charge 2, on 23 May 2014 committed theft in the sum of $500;

Charge 3, on 28 May 2014 committed theft in the sum of $370 and;  

Charge 4, on 2 June 2014 committed theft in the sum of $200.

2Each of these charges carries a maximum penalty of ten years' imprisonment.  None of the money that you have stolen from Lardner Mechanical Repairs has been repaid to your victim, Mr Graham Kinrade.

Circumstances of your offending

3The background of your offending is that you were employed as the bookkeeper for Lardner Mechanical Repairs.  Graham Kinrade was the proprietor and director of Lardner Mechanical Repairs.  You and Mr Kinrade had known one another, having lived and grown up, generally, in the township of Warragul for approximately 18 years.  You were the same age.  He employed you as a bookkeeper.  You were employed by him at Lardner Mechanical Repairs as the bookkeeper for 21 years.  Your employment was terminated in June 2014.

4During the period of offending, Lardner Mechanical consisted of three mechanical workshops situated in Queen Street in Warragul, McMahon Street in Traralgon and Moe.  Lardner Mechanical provided general car maintenance and held RACV contracts for the areas of Drouin, Warragul, Moe and Traralgon for the latter part of 2008.  In the latter part of 2011, the Moe and Traralgon areas were surrendered and the Warragul and Drouin areas were continued until the business was ultimately sold in June 2017.

5The mechanical workshops located at Warragul was the main office. 
The business office was located there, and it was where you worked together with other administrative staff. 

6During the period of the offending, the business employed about 18 people.  Some worked full-time and others worked on a casual basis.  The administrative staff employed during the period were: yourself, Kim Millsom who is now known as Kim Moroney, and Melissa Kelton. 

7You were responsible for bookkeeping, banking, doing the post, the payroll, accounts, preparing BAS statements, and other general duties.  One particular aspect of your job included preparing annual financial reports for the completion of annual tax returns.  This documentation would be given to the business' accountant, Mr Zvonko Maric.

8The business had two separate accounting systems, one called AMWIN and the other called CashManager.  The CashManager system was used for accounting purposes and to record banking.  The AMWIN system was used to create job cards and invoices for the work performed on customers' vehicles.  There was no routine reconciliation procedure between the AMWIN system and the CashManager system.

9In 2012, your fellow administrative worker, Ms Moroney, attended a course on AMWIN systems.  She came back to the business and suggested to you that the CashManager system could be eliminated if the AMWIN system was expanded in the business.  You were not enthusiastic about this proposed change. 

10In May 2014, you made the mistake of all dishonest bookkeepers.  You went on holidays. 

11The circumstances of discovering your offending were as follows:  On or about May 2014, Mr Kinrade heard there was a problem with a customer, Ross Collins' account.  Mr Collins said he had received a statement for an account he had already paid.  As you were away on holidays, Ms Moroney looked into the matter.

12The customer had paid in cash.  Ms Moroney looked at the receipt book but could not find any record of that payment.  She then checked the deposit book to check the banking, but found the banking was less than what it ought to have been on that particular day.  Ms Moroney then looked at the next few consecutive banking times and found some discrepancies where deposit amounts did not match the amounts received.

13Ms Maroney then went to Mr Kinrade, explaining what she had found regarding the differences between the amounts received according to AMWIN and what was deposited at the bank.  Ms Moroney also told Mr Kinrade about the concerns she had had sometime earlier about your payments to yourself.

14As a result, Mr Kinrade and Ms Moroney decided to closely monitor all cash and cheque payments made to Lardner Mechanical.  A spreadsheet was created where Ms Moroney would record all cash and cheque payments made from both Traralgon and the Warragul offices which was then compared with the amount banked.  A comparison over eight days was conducted.

15On each of the three occasions you did the banking, the following cash discrepancies were found: 

·On or about 23 May 2014, you banked $4,154.05 cash, which was $500 less than that which had been accounted for.  That is Charge 2. 

·On or about 28 May 2014, you banked $3,389.40 cash, which was $370 less than that that had been accounted for.  That is Charge 3.  And;

·On or about 2 June 2014, you banked $4,273.75 cash, which was $200 less than the amount that had been accounted for.  That was Charge 4.

16During this time when you were being monitored. Ms Moroney would check that she had recorded on a spreadsheet with what was in the till and the figures would balance.  It was usually within two or three hours of this that the banking would take place.

17Mr Kinrade engaged his accountant, Zvonko Maric, to conduct a review of Lardner Mechanical finances.  Mr Maric, in undertaking the review of Lardner Mechanical finances, compared monthly customer payment reports from
AMWIN - which identifies all proceeds receipts from customers that had been allocated - against invoices raised.  These monthly customer reports were then compared or matched to Lardner Mechanical's bank deposit books and bank statements.

18From this review, Mr Maric found that the cheques, direct deposits, electronic funds transfers and points of sale payments were matched and reconciled to the bank statements, but there was significant discrepancies with the cash components of the monthly customer payment reports. 

19Subsequent to that analysis, a forensic accountant, Mr Luke Meehan, showed that during the period of the alleged offending a total of $309,553.38 had been taken.  Mr Meehan said that he would not expect to see this discrepancy given the nature of the analysis. It is alleged that you engaged in a course of conduct in which you would regularly steal cash money from Lardner Mechanical Repairs.  That is Charge 1, and schedule A on the indictment sets it out clearly.

20Mr Meehan also examined a number of your bank accounts and was able to find cash deposits amounting to $59,715 during the period of the alleged offending.

21There has been no repayment of the money stolen by you.  Indeed, I was told that you were declared bankrupt in October 2015.  The reason for your bankruptcy is a default on a Westpac loan that you took out to fund your legal expenses to defend a claim by Mr Kinrade to recover the funds you had stolen from him.  Your offending was not particularly sophisticated but it was persistent and brazen in the sense that you continually stole cash from the business where you were employed as a bookkeeper.

Victim Impact Statement

22Mr Graham Kinrade filed a victim impact statement dated 16 January 2019. 
It was Exhibit “B” on the plea.  The victim impact statement was read into evidence by the prosecutor.  Mr Kinrade sets out how he knew you since 1984.  He started his business in 1986.  In 1993, he employed you as the bookkeeper.  He described you as a trusted employee who could look after his business on the financial side.  He was working 60 to 80 hours a week on the business, conducting the RACV service, the workshops, and he says he had up to
30 employees over the period.

23When he discovered your theft from him, he was shocked, devastated and emotionally distressed.  Although he had the proof, he could not believe it. 
He set out how you took action at Fair Work for unfair dismissal against him. 
In his County Court proceedings to recover the money stolen by you from him, you continued denial of the thefts.  He found this very hard and stressful. 
He says he incurred considerable legal and accounting fees as a result of those two matters.

24He set out how he struggles with his decision to trust you over all those years.  He feels like a failed business person.  He has lost his ability to trust any person outside his immediate family.  He suffers from stress and anxiety as a result of your offending.  He spoke of an example of mistakenly thinking you were in a local restaurant when he attended, and how he freaked out and just wanted to leave.  He has stated the stress has caused his health to decline, and ultimately, he had a pacemaker inserted in September 2015.

25Your offending has a clear and devastating effect on Mr Kinrade in the financial, emotional and physical health sense.  In summary, I would describe your behaviour to him as being treacherous.

Personal Circumstances

26You are now 54 years old.  At the time of your offending, you were between the ages of 45 and 50 years old.  Both of your parents are alive but retired.  Your father was a school teacher, your mother was a kindergarten teacher.  They were both in court here to support you today and are here now.  Your only sibling, Cathy, is also in court today to support you. Your sister has unfortunately been a paraplegic as a result of a motorcar accident from the age of 17.  Initially, as the elder sister, you were her unpaid carer for approximately ten months near the time of that accident. 

27You have a partner, Mr Bourke.  You have a daughter aged 25 who works as a primary school teacher in a nearby town.  She lives with you and your partner up to the present time.  You effectively brought up Mr Bourke's daughters in the role of a stepmother.  They are now adults and have families of their own.

28You jointly own your home in Warragul with Mr Bourke.  You have a mortgage on that property of some $260,000. 

29You attended primary school at Bayswater North and Studfield East. 
You completed your formal education at Year 10 level at the Warragul High School in 1978.

30You have a consistent work history.  Initially, you worked as a sales assistant in a record shop which was in Moe, after you left school.  You had a period of less than a year looking after your sister.  You then, at age 20, worked for two years up at Mount Baw Baw in the kiosk and in the bar.

31You worked as a bookkeeper for a period of eight years at Chrisdan Building in Warragul.  Your employment ceased when that business went into liquidation.  Your next employment was with Lardner Mechanical Repairs for 21 years, until your employment was terminated on 12 June 2014.  Your termination occurred as a result of your offending before the court.

32In September 2014, you commenced your employment with Warragul City Motors as a bookkeeper and warranty claims officer.  You resigned from that employment on 8 March this year in preparation for these court proceedings. 

33You have been assessed by Mr Jeffrey Cummins, a consulting forensic psychologist, for the purposes of this case.  His report dated 7 March 2019 was Exhibit “2” on the plea.  Mr Cummins noted that you felt that you were overwhelmed by your legal situation and it took you a long time to decide to plead guilty to your offending.  He noted you said you felt embarrassed and ashamed about your offending.

34On Mr Cummins' assessment, you presented as moderately depressed and someone who had become very adept at suppressing your feelings.  He thought this was a significant defence mechanism for you.  Mr Cummins noted you could give him no explanation for your offending.  He thought your mental health may abruptly deteriorate when you are sentenced to imprisonment, but was unable to give a definite diagnosis for your mental condition.

35You relied upon a number of character references.  I have read the references from Tamina Taylor, Jane Graham, Maurice Morton, Beverley Collins, Colleen Maxwell and Barry Bourke.  All of these people are shocked and surprised that you are before the court on the charges of theft.  They will be there to support you when you are released from prison.

Sentencing Considerations

36The basic purpose for which a court may impose a sentence are just punishment, deterrence, both specific and general, rehabilitation, denunciation of your actions, and the protection of the community.  In sentencing you, I must have regard to a range of factors such as the seriousness of your offending, your culpability for it, and your personal circumstances.

37I am also required to balance the interests of the community in denouncing your criminal conduct with the interests of the community in seeking to ensure, as far as possible, that you as an offender are rehabilitated and reintegrated into society.

38I am also required to take into account current sentencing practices in fixing your sentence.  That enquiry is directed particularly but not exhaustively to the kinds of sentences imposed in comparable cases and the statistics for those sentences. I have considered the statistics and the current sentencing practices, mindful that each case must be considered in the light of its own particular circumstances, and many of the cases that I have looked at would be distinguishable from your case, as indeed they are from one another. 

39Of course, current sentencing practice is only but one factor I take into account when fixing your sentence.

40You have pleaded guilty to these charges.  Your plea of guilty was indicated at a late stage.  Your plea does have the utilitarian value of allowing for the orderly and effective administration of justice.  There is a certainty of outcome and the resolution of the substantive issues raised by your offending.  Your plea allows for the preservation of the court and police resources to deal with other matters.

41Your plea vindicates the public confidence in the legal process set up to protect the community.  Your plea is also a clear acknowledgement by you that you accept responsibility for your criminal behaviour on these occasions.  Your plea also recognises you are willing to facilitate the course of justice in the community, and I accept that your plea of guilty to these charges indicates and demonstrates, and I emphasise, some remorse on your part.

42I emphasise that the remorse in this case is limited.  You initially issued proceedings for unfair dismissal at the Fair Work Commission in the light of your known offending.  You also defended civil proceedings taken by Mr Kinrade to recover his stolen money from you.  Both of these actions by you limit the remorse demonstrated by you for this offending.

43You have no prior convictions and are previously a person of good character. 
I accept that you have helped members of your immediate family and your extended family, as set out in the references (Exhibit “3”).  I take those matters into account when fixing your sentence. 

44There has been a four-year delay between the discovery of your offending and the resolution of these charges in November 2018.  You have been employed as a bookkeeper in that time.  I was told there are no other pending charges.

45In your case, it is difficult to assess the effect of this delay upon you.  Clearly, you would have had some anxiety about what the outcome of these charges would mean for you.  On the other hand, you obtained similar employment and worked until recent days as if nothing else was going on for you.  Mr Cummins refers to your denial or suppression of your feelings as a significant defence mechanism.

46I do not accept that the hardship that will occur as a result of your imprisonment on your partner and family would meet any exceptional circumstances test.  Both your daughter and your partner are adults and engaged in employment. 

47It was submitted on your behalf that limb six of the Verdins case has application to your case.  Mr Marquis relied on the opinion of Mr Cummins to submit that there was a serious risk that imprisonment would have a significant effect on your mental health, which is a factor to mitigate your punishment.

48Mr Cummins' opinion on this point was somewhat equivocal, given his view of your current defence mechanisms, to which he referred in his report.  I accept there is a risk.  The impact of your offending will be brought into sharp focus when your familiar surroundings are changed to imprisonment.  I note your reporting to Mr Cummins that you will cope in prison.

49The offending by you is serious.  The factors indicative of the seriousness are as follows: 

(1), this is a gross breach of trust;

(2), the breach of trust continued over a period of five years;

(3), the total sum of money stolen was approximately $310,000;

(4), your victim was someone you had known for a very long time, and then he had employed you for a period of 21 years;

(5), there was no recovery of any of the stolen funds or explanation about where they are, and;

(6), there is a significant impact, financially, on your victim, as well as his mental well-being.

50It is difficult to assess your risk of reoffending as you have not and could not offer any explanation of your offending to Mr Cummins when you were asked to provide one to him.  You can offer no explanation about where the large sum of money has gone.  I assess your prospects of rehabilitation as guarded.

51Your offending is a serious example of a sustained abuse of a position of trust, particularly combining the factors in this case of your employment and friendship with Graham Kinrade. 

52Your counsel conceded that a term of imprisonment was the only proper outcome.  That was a proper concession to be made by him.  Your counsel urged the court to fix a non-parole period so that your rehabilitation could be assisted. 

53The sentencing principles of general and specific deterrence are applicable in your case.  Your offending called for a term of imprisonment to reflect the denunciation of your conduct and just punishment.

54In fixing your sentence for all of the four charges, I am mindful of the totality principle and that any degree of cumulation in Charges 2, 3 and 4 could result in a crushing sentence. 

55Would you stand, please?

56On Charge 1, you are sentenced to three years and three months' imprisonment.  That is the base sentence.

57On Charge 2, you are convicted and sentenced to one month's imprisonment.

58On Charge 3, you are convicted and sentenced to one month's imprisonment.

59On Charge 4, you are convicted and sentenced to one month's imprisonment.

60That is a total effective sentence of three years and three months. 

61I fix a non-parole period of two years and three months.

62Pursuant to s.6AAA of the Sentencing Act, but for your plea of guilty, I would have sentenced you to a period of four years and six months with a non-parole period of three years and three months.

63You have served no pre-sentence detention.

64And I order that you are to provide a forensic sample pursuant to s.464ZF. 
And I will just explain to you what that is.  How that is done is, they take a swab from inside your mouth.  Do you understand what I have just said?  They can use reasonable force to obtain it if you do not agree.  Do you understand that?  Thank you. 

65Is there anything further?

66MS LENTHALL:  No, Your Honour. 

67HIS HONOUR:  Thank you.  You can remove the prisoner.  Thank you.  I have got the 464 order there.  It is signed.  I want to thank both members of counsel and those that instruct them for their assistance in this case.  Thank you. 

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