Director of Public Prosecutions v Munn
[2019] VCC 933
•25 June 2019
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE CRIMINAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CR-17-01396
| DIRECTOR OF PUBLIC PROSECUTIONS |
| v |
| BRIAN MUNN |
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JUDGE: | HER HONOUR JUDGE HOGAN | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 11 and 12 April 2019 | |
DATE OF SENTENCE: | 25 June 2019 | |
CASE MAY BE CITED AS: | DPP v Munn | |
MEDIUM NEUTRAL CITATION: | [2019] VCC 933 | |
REASONS FOR SENTENCE
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Subject: CRIMINAL LAW
Catchwords: Three charges of obtaining financial advantage by deception – conduct over a period of 1 year and 8 months, whereby the defendant defrauded a labour hire company of $1,959,744.
Legislation Cited: Sentencing Act 1991
Cases Cited: R v Verdins; R v Buckley; R v Vo [2007] VSCA 102
Sentence: Total Effective Sentence of 3 years’ imprisonment with a non-parole period of 18 months; s6AAA declaration: 4 years and 6 months’ imprisonment with a non-parole period of 3 years.
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APPEARANCES: | Counsel | Solicitors |
| For the DPP | Mr J Singh | Solicitor for the Director of Public Prosecutions |
| For the Accused | Mr T Lavery | James Dowsley & Associates Criminal Law |
HER HONOUR:
1 Brian Munn, you have pleaded guilty to three charges of obtaining a financial advantage by deception. Each of these charges carries a maximum penalty of 10 years’ imprisonment.
2 The circumstances of your offending are summarised in the prosecution opening for plea (Exhibit “A”). Each of the three charges is a rolled-up charge which involves multiple transactions of dishonesty. In short, you carried on businesses whereby you supplied traffic control services to be used on construction sites. You conducted these businesses under the names of various companies during the period of offending. These companies were 24/7 Traffic Pty Ltd, NMK Road Safety Designs and Audits Pty Ltd and/or NMK Rail Services Pty Ltd (“NMK”) and Spotters R Us Pty Ltd. Over a period of one year and eight months, between 14 February 2013 and 14 October 2014, you obtained a financial advantage from a labour hire or recruitment service business, AB Contracts Pty Ltd (“AB”). The total amount of the financial advantage obtained by deception from this company over that period and covered by the three charges was $1,959,744.
3 It would appear that you ingratiated yourself with Mr Gordon Murdoch, who was the executive director of AB. You arranged for AB to supply and pay the wages of numerous casual staff, whom you utilised for your traffic management business. You accrued a substantial debt to AB by using a series of false representations and dishonest conduct to enable you to evade repayment of the company accounts, to defer repayment of those accounts and to gain further credit from the company. It would appear that Mr Murdoch trusted you. Also, he seems to have been keen to ensure that he continued dealing with you once you became indebted to AB as he believed that, if he could assist you to keep trading, then you would be able to pay back the money to AB.
4 Mr Murdoch, himself, engaged in deceptive conduct towards his fellow directors of AB after they instructed him to stop dealing with you and close your account in or about June 2014. This conduct included setting up the business, Spotters R Us, one of the traffic management companies which contracted with AB. Mr Murdoch did this via a company called Lagoon Company Pty Ltd of which he was a director. In order to disguise from his fellow directors the fact that he was still dealing with you, he created a false contact person and business address for Spotters R Us and represented to his fellow directors that the business had good backing and a history of paying accounts. He was interviewed by police and made admissions to this effect and, initially, charges were laid against him. However, there is no evidence that he personally benefited from any arrangement with you. He told police that he feared that, if he ceased dealing with you, AB would never recover the money owed to it from its dealings with you via NMK.
5 By the first half of 2014, NMK’s debt to AB well and truly exceeded $1 million. Mr Murdoch told police that he believed that you would eventually come good with payments due to the reasons which you provided to him. Unknown to him, these reasons were completely false. By June 2014, one of Mr Murdoch’s fellow directors was forced to put $500,000 of his own money into AB. Mr Murdoch’s employment with AB was brought to an end on 22 October 2014 when fellow directors and shareholders became aware of his involvement with Spotters R Us and his continued dealings with you. Ultimately, the charges against Mr Murdoch were withdrawn and he received an undertaking from the Director of Public Prosecutions that evidence he gave in relation to these charges against you would not be used in any proceedings against him.
6 Charge 1 comprises 65 transactions of obtaining a financial advantage by deception between 14 February 2013 and 27 June 2014. The total amount of transactions was $576,903.94..
7 Charge 2 comprises 52 transactions of obtaining a financial advantage by deception between 15 February 2013 and 27 June 2014, which totalled an amount of $1,332,407.48.
8 Charges 1 and 2 involved you conducting business using the companies, NMK Road Safety Designs and Audits Pty Ltd and/or NMK Rail Services Pty Ltd.
9 Your offending relating to Charge 3 is of a different nature. It involved you conducting business under the company Melbourne Spotters R Us Pty Ltd during the timeframe from 4 July 2014 to 10 October 2014. Unlike the offending on Charges 1 and 2, this criminal behaviour did not simply involve making false representations about when AB would be paid and the reasons for the delay. You actually submitted time sheets to AB which were false in that they recorded payments allegedly made to staff who were not legitimate staff.
10 The prosecution fairly conceded in relation to Charge 3 that there was some ambiguity regarding AB’s reliance on your false representations about when you would pay AB for its labour hire services and have confined the offending on this charge to the amount of $50,432.98 which reflects only the portion of your offending attributable to payments of non-legitimate staff. There are a total of 15 acts of obtaining a financial advantage by deception which support Charge 3.
11 No amount of the outstanding debt of $1,959,744 owing to AB was ever paid by you. The director, Mr Mann, who injected $500,000 of his own capital into the business in 2014 is now deceased.
12 You were interviewed by police on 23 May 2013 in relation to the charges and exercised your legal right to make a “no comment” record of interview. The first filing hearing was held in the Magistrates’ Court on 27 May 2016. Thereafter, there were multiple committal mentions until 12 July 2017, the date of committal. On that date, the matter proceeded by way of hand-up brief with pleas by you of not guilty being noted. Once the matter came before the County Court on 13 July 2017, there were some 12 directions hearings or mentions until 23 July 2018 when you pleaded guilty to the three charges. They were adjourned for plea hearing on 22 November 2018 and further adjourned to a plea hearing commencing on 11 April 2019.
13 You are presently aged 55 years, having been born on 9 March 1964. You come before the Court with one prior appearance a long time ago. On 11 May 1995 you appeared before Prahran Magistrates’ Court on charges of being drunk and resisting police and without conviction the matter was adjourned for 12 months on condition that you be of good behaviour. I regard this prior matter as being of no relevance to the sentences which I must impose on the three charges of obtaining a financial advantage by deception.
14 In a plea on your behalf, Mr T Lavery submitted that the offences were the result of “poor business decision-making” and trying to trade out of financial difficulties. He submitted that your criminal conduct was not motivated by a desire to achieve personal enrichment. Mr Lavery stated that you had left school at the age of 15 years after completing Year 10 and become a professional golfer for a couple of years. Thereafter, you worked in sales for five years, landscaping for five years and in a recruitment agency for 10 years. He stated that, whilst working in the recruitment industry, you had become aware that a number of companies were dealing with casual staff in order to manage traffic for other businesses. It became apparent that no capital was needed to set up this business and no staff management was involved. Hence, you decided to set up a traffic management business called Metropolitan Traffic. However, you had no business experience when, at the age of 47 years, you began operating traffic management businesses in 2007 through companies set up by you and called Metropolitan Traffic and 24/7 Traffic Pty Ltd.
15 Mr Lavery stated that, although you had contracts with reputable clients such as Yarra Trams, Fulton Hogan and a rail construction company, Colemans, you ran into financial difficulties. He stated that this was because contracts with those companies meant that, if work could not be done on a particular site on a day upon which you had organised staff by using a labour hire company, then you would not be paid but would have incurred the expense of hiring the labour. It would appear that you failed to pay company tax and also PAYE tax and ended up being indebted to the Australian Taxation Office for two amounts of $800,000 and $407,870, an amount in excess of $1.2 million. It seems that you ultimately operated your business through more than simply the two previously mentioned companies. The debt to the Australian Taxation Office apparently related to the operation of at least two companies of which you were the director, Metropolitan Traffic Managers Pty Ltd and 24/7 Traffic (Geelong) Pty Ltd, both of which had been placed into liquidation in 2009 and 2011 respectively. However, two other companies with which you were associated with a similar business model of traffic management had also been placed into liquidation. You declared yourself bankrupt and remained an undischarged bankrupt from 16 March 2010 to 17 March 2013. Mr Lavery stated that you paid off the $1.2 million debt to the Australian Taxation Office by two instalments of $3,300 each per month over a period of two or three years and then a final instalment of $100,000 was paid. This occurred from 2012 to 2016.
16 As an undischarged bankrupt you were not permitted to be the director of any company, so you arranged for your former wife, Marcia Munn, to replace you as the director of another one of your companies, 24/7 Traffic Pty Ltd. She remained the named director of this company until it was placed into liquidation on 16 April 2014, however, it is clear from the material before me that you continued to be the de facto director of that company. You were the person who conducted all of its business. Between 14 February 2013 and 15 March 2013, there were five transactions which form part of Charge 1 and between 15 February 2013 and 1 March 2013, there were three transactions which form part of Charge 2, which took place prior to you even being discharged from bankruptcy on 17 March 2013.
17 Mr Lavery stated that in order to keep trading, you were being financed by a “debt factory” called Benchmark Debtors Finance Pty Ltd (“Benchmark”) and that this had occurred from 2007 through to 2014. It seems that, at some stage, Benchmark took over the operations of the company Scottish Pacific Finance Pty Ltd (“Scottish Pacific”). Exhibit “B”, a statement from Gail Worsley made to police on 16 May 2016, indicates that your company, 24/7 Traffic Pty Ltd, was financed by Scottish Pacific from 24 May 2007 until approximately September 2013. Scottish Pacific would finance your company for up to 80 per cent of the value of your company’s outstanding approved debtor invoices to a maximum period of 90 days. After September 2013, Scottish Pacific provided no further credit to you because you had a debt of $474,000 owing to them which, over time, reduced to $224,288.08. Scottish Pacific engaged lawyers to recover this debt and your company, 24/7 Traffic Pty Ltd, entered into an agreement with Scottish Pacific to pay off the debt on terms agreed between the parties, but on occasions you defaulted on these terms.
18 In late 2013, when you were being financed by Benchmark, you made arrangements for money owed to you for your traffic management services to be paid directly to Benchmark. It seems that the debt to Benchmark fluctuated from time to time, but that relationship with Benchmark ceased in or about 2017.
19 When I questioned your counsel as to how it was that you came to be still so significantly in debt by the time you were discharged from bankruptcy in March 2013 and began trading again, many more details of your past business history came to light. These were embodied in the document which was tendered as Exhibit “C” by the prosecution. This document is headed “History of Companies Under the Direction of Munn” and is a summary of relevant parts of a statement by Norman Jones, who was the liquidator appointed to deal with your companies. It reveals that, apart from the aforementioned debts of over $1.2 million to the Australian Taxation Office and $474,000 (albeit reduced to $224,288.08) owing to Scottish Pacific, you had dealt with several labour recruitment companies and left them with unpaid invoices prior to commencing your relationship with AB in early 2013:
·In 2011 the labour hire company, Inter Industrial Services, ceased dealing with you due to poor payment of company invoices and the company was left with a debt of $62,740.27 unpaid by you company, 24/7 Traffic Pty Ltd.
·In 2012 your company, Metro 24/7 Traffic Pty Ltd, which had never owned any assets or ever traded and had always been dormant, entered into contracts with a labour hire company, Raven Personal Pty Ltd. In or about 2010, a default judgment was obtained against your company, Metro 24/7 Traffic Pty Ltd, by an apparently misnamed plaintiff, Raven Personnel (my emphasis) Pty Ltd. The judgment was related to unpaid invoices. Mr Lavery stated that you did not defend this matter because the company named as the plaintiff was not one with which you had dealt and, in any event, you disputed that you owed it any money. When invited by the Court to clarify the position by giving evidence about it, you declined to do so, as is your legal entitlement.
·In 2012 your company, 24/7 Traffic Pty Ltd, utilised a labour hire company, Staff Australia, and that company ceased dealing with you due to unpaid company invoices and was left with a debt of $33,326.82 unpaid by your company.
20 The foregoing details appear to indicate that you were a person who was acting in breach of the Corporations Act by having the full control and running of the daily operations of the business of 24/7 Traffic Pty Ltd whilst you were an undischarged bankrupt, even though your former wife was nominally the director of that company. That is not a matter which forms part of any of the sentence which I must impose, however, it shows you to be a person who appears to be careless about legal obligations and debts owed to others.
21 In response to Mr Lavery’s submission that “The offending behaviour was the result of poor business decision-making and trying to trade out of the resulting difficulties”[1], I find on all the material before the Court that, whilst you were obviously trying to trade your way out of difficulties, you were doing so unscrupulously with scant regard for the financial detriment that you would cause to AB. As I have stated, it is no part of my role to punish you for any crimes other than the three to which you have pleaded guilty, however, I reject the complexion of “poor business decision-making” which Mr Lavery submitted was the reason for your offending. I would describe it as blatantly dishonest conduct in circumstances where you knew that you had incurred significant debts that you were paying off, both to the Australian Taxation Office and to Benchmark. What you were doing was effectively using AB’s services so that you could earn money from your clients to pay off debts to Benchmark and disregarding your obligation to pay what you owed to AB. Your behaviour was premeditated and repeated many times. You have the benefit of all charges being rolled-up charges but the fact of the matter is, your conduct involved multiple separate dishonest transactions on all three charges. You left AB out of pocket by almost $2 million. I accept that there is no evidence of your enrichment, but there is certainly evidence that your conduct impoverished others, namely the directors and shareholders of AB, including Mr Murdoch, who trusted you.
[1]Paragraph 4 of Outline of Submissions on Plea dated 10 April 2019
22 As part of your plea, it was put that, in effect, Mr Murdoch had facilitated your offending by not conducting a due diligence or credit check and by deceiving his own business partners. Although Mr Murdoch did deceive them, I am satisfied that there is no evidence that he personally benefited from his dealings with you and he genuinely believed the various false excuses that you gave to him for delaying payment. Nor is there any evidence that Mr Murdoch was aware that you submitted time sheets containing the names of false employees and fabricated hours worked by them as part of your traffic control business.
23 In short, you have demonstrated yourself to be a successful “con man”. Within two months of commencing to deal with AB, you told Mr Murdoch that you were in the process of selling your business for $1.6 million to a Chinese company and produced paperwork that purported to substantiate that transaction. This was a false representation. By September 2013, you told Mr Murdoch a series of false explanations as to why you were not making payments to AB for the labour supplied to your business. These included that you were going to receive a payout from Benchmark Debtors Finance Pty Ltd of some $700,000 when, in fact, you knew that you were indebted to Benchmark. You also told Mr Murdoch that you were in the process of selling a house at 13 Times Square, Point Cook which you owned outright, when you had no such financial interest in this property or any other assets due to having only been discharged from bankruptcy on 17 March 2013. Further, you told Mr Murdoch that your three main contractors, Fulton Hogan, Yarra Trams and Coleman Rail, were withholding payments of invoices when, in fact, records show that these contractors paid invoices submitted by you and there were no accounts outstanding. In addition, you told Mr Murdoch that you had access to a $350,000 loan from the Westpac Bank, when, in fact, you had no agreement with Westpac Bank during the period of 2013 or 2014. Hence, I find that the conduct engaged in by Mr Murdoch was essentially in order to try to ensure that AB got the money that you owed it and that he was repeatedly reassured by these false representations by you.
24 Apart from making false representations to Mr Murdoch about your financial capacity and assets, you deliberately falsified records and time sheets submitted for work ostensibly carried out by the traffic control business, Melbourne Spotters R Us Pty Ltd. You represented that some 21 persons had been engaged for traffic control work for which AB was to pay. The false employees’ names included that of your current wife, Tenille Craig, Negin Motaghi a former girlfriend of yours, and Marcia Wapshott, which was the maiden name of your first wife, whom you told the court you divorced 20 years ago. To describe such deliberate, premeditated misrepresentations designed to have AB pay money for workers either never engaged by you, or for hours well in excess of what they actually performed as “poor business decision-making” is a serious mischaracterisation of repeated and blatant dishonesty calculated to extract further services from AB to whom you were already seriously indebted. These misrepresentations by way of false time sheets occurred at various times throughout the course of your offending, however, the offending on Charge 3 is comprised solely of amounts relating to false time sheets. Thus, although the amount of the deception is very considerably less on Charge 3, the blatant nature of the conduct underpinning it makes it serious.
25 The prosecution acknowledges that due to the complexity of the transactions between yourself and AB and the length of time over which they occurred and the complicating involvement of Mr Murdoch’s conduct, the Court should regard your plea of guilty as having significant utilitarian value as a trial may well have been lengthy and expensive and involved calling, not only Mr Murdoch, but the liquidator, Mr Jones, and also Ms Worsley from Scottish Pacific/Benchmark and, of course, the records of both AB and the companies which you utilised to contract with AB, namely, 24/7 Traffic Pty Ltd, NMK Road Safety Designs and Audits Pty Ltd and NMK Rail Services Pty Ltd, as well as the records and bank statements relating to Melbourne Spotters R Us Pty Ltd.
26 Your counsel submitted that your plea should also be regarded as a remorseful one. As I stated at the plea hearing, I hold serious reservations about whether you are remorseful for your criminal conduct. You failed to cooperate with this investigation, which is your legal right. You made a “no comment” record of interview, which is your legal entitlement. However, in such circumstances it was incumbent upon the prosecution to assemble a very substantial body of evidence to put before the Court involving 132 separate transactions by you over a period of one year and eight months and involving records of multiple different companies through which you conducted your business. Although you consented to a hand-up brief, rather than conducting a contested committal, you made it clear, as at 17 July 2017, that you would be pleading not guilty.
27 Once the matter came within the County Court jurisdiction, there were multiple adjournments between the initial directions hearing on 13 July 2017 and your being arraigned on 23 July 2018. I understand that these adjournments were largely occasioned by yourself, apparently relating to the issue of funding your legal representation. There may have been some small amount of delay which was not attributable to you. In particular, I acknowledge that, following the plea hearing held on 11 and 12 April 2019, the adjournment until today’s date has been occasioned by my not being available to pass sentence. I take into account such delay as has not been caused by yourself by recognising that having these charges hanging over your head and not knowing your fate is a likely cause of anxiety. Also, it would appear that you have changed your ways since being charged. I will refer later to the manner in which you have led your life since the commission of these offences.
28 On the question of remorse, I note that a report from Ms Carla Lechner, psychologist, dated 3 March 2019 was tendered as Exhibit 1. Ms Lechner had seen you on 25 October 2018 and she recorded the following history:
“Mr. Munn acknowledges his role in the above offences. He stated that a number of companies became entwined and monies were shuffled between them in order to pay debts and wages. He stated ‘I made a lot of bad decisions but to say I didn't intend to pay is not true and it drives me insane’. He stated that he and his ex-wife were running it – ‘she ran it while I was bankrupt (released in April 2013). He stated that he has now ‘lost everything and all my friends, completely broke ... my wife is the sole breadwinner ... if I go to jail my wife can't work because of Andi's [sic] care’ [a reference to your younger child who has Down syndrome].”
29 You claimed through your counsel that Ms Lechner had not accurately portrayed what you had told her, yet you had tendered her report to the Court to be relied upon as part of your plea in mitigation. To put it at its kindest, this appears to be me to a sanitised view of your offending as though companies “became entwined and monies were shuffled between them” unrelated to any dishonesty by you. From the time you started contracting with AB, you were significantly indebted to both Benchmark and the Australian Taxation Office and the amount that you owed to AB increased and increased so that by June 2014 the amount of unpaid debt on the NMK account was $1,498,759.90. Notwithstanding the extent of such indebtedness to AB, you continued to fabricate stories as to when and how you would pay back the debt, to encourage Mr Murdoch to ensure that you were granted more credit. In these circumstances, I find I cannot accept that you genuinely believed that you would repay AB what you owed it. Moreover, the concern expressed by you to Ms Lechner appears to relate to the impact upon yourself and your family and the embarrassment you feel and the stress of the court process. Ms Lechner’s report contains no mention of the impact of your offending upon the directors or shareholders of AB. Indeed, in the course of the plea, your counsel mentioned that AB had failed to conduct due diligence inquiries in relation to your business, as though that somehow mitigated your offending.
30 A reference from your current wife, Tenille Craig, apparently dated on or about 28 March 2019, was tendered as part of Exhibit “4”. I wonder whether your wife actually knows the full extent of your offending, because she states:
“Brian is truly upset and remorseful for any wrong doing or upset he may have caused, but I also believe with all my heart that Brian never intended to harm anyone along the way.”
31 This is a curious statement given the repeated transactions and the repeated blatant false misrepresentations and falsified time sheets (which include time sheets in Tenille Craig’s own name, albeit that there is no evidence that she knew of this). For your wife to describe you as someone who “has made a mistake”, seems to show little appreciation of the very protracted nature of your repeatedly dishonest conduct. Also, as I have stated previously, there is evidence before the Court that, in the past, you have left thousands of dollars of debt unpaid to other labour hire companies with whom you contracted prior to your dealings with AB.
32 I have already mentioned that one of the directors of AB, Mr Mann, was compelled to inject half a million dollars of his own money into the company because of your conduct. Also filed with the Court is a Victim Impact Statement from Mr Murdoch, which was tendered today as Exhibit “D”. He refers to the fact that he had been an operating director and shareholder of the AB Group of companies for over 15 years and, when your fraud came to light, his fellow directors, who had been his closest friends, could not believe that he did not know all about your wrongdoing. They locked him out of the business and issued legal proceedings against him and told the police that they believed he was in cahoots with you and part of your crimes. This resulted in him being embroiled for four years in financial litigation and criminal investigation. In the meantime, Mr Mann, one of his fellow directors who had been like a father to him and mentored him, died believing that he, Mr Murdoch, had stolen from him. Mr Murdoch dwells on this and he has required counselling, as has his family. He has seen his own financial security dissipate. He had gone from a very secure financial position in which he held shares in the AB Group and held an excellent remuneration package, and his retirement was looking secure. He had two properties to fund his retirement. As a consequence of your criminal behaviour, he has lost one, and his other property (his family home), now has a $500,000 high interest loan against it. He refers to other devastating financial consequences and reports that he is now 61 years old and runs a small business in which his remuneration is less than a quarter of what it was when he was with AB. He states that it is unlikely that he can recover to a point where he can enjoy the retirement that he had worked hard for over many years with AB.
33 Mr Lavery urged the Court to note that, in addition to your lack of relevant prior offending, you had not committed any criminal offences subsequent to those for which I must sentence you. You are married to Tenille Craig and live at Safety Beach on the Mornington Peninsula. You have not worked for four years. You have effectively become a house husband. You have two children: Hunter, aged four years, and Andie, who is 18 months old. Andie was born with Down syndrome and you were receiving a carer’s pension and looking after her significant needs prior to the time when I remanded you in custody on 12 April 2019.
34 A report from Andie’s paediatrician, Dr Ylva Andersson, dated 21 October 2018, was tendered as Exhibit “2”. Dr Andersson detailed Andie’s condition, which includes developmental delay and noted that Andie has also had to be prescribed hearing aids for hearing loss and the fact that grommet surgery is now planned. Dr Andersson stated that, generally, children with Down syndrome are at risk of joint hypermobility and joint instability and increased risks of cervical spine dislocation. They usually require close monitoring of their diet and behavioural and psychological problems are more common among children with Down syndrome than amongst other children. She notes that your wife, Tenille, told her that she was in full time employment with Frankston City Council and that you were the full time carer and that Andie required regular weekly physiotherapy with a physiotherapist, as well as a daily home exercise program. She noted, as at 21 October 2018, that Andie was functioning at the level of a much younger baby, closer to that of one who was four months old rather than 11 months old, as Andie was at that time. She stated that Andie required a lot of interaction, stimulation and exercises, as well as help with the activities of daily living.
35 A report was also tendered as Exhibit “3” from Andie’s treating physiotherapist, Ms Penny Green, dated 14 November 2018. She has been Andie’s physiotherapist since she was two months old. She noted back in November last year that she had extremely low muscle tone and appeared to have low motivation or interest in toys, her development trajectory was currently very different from children without Down syndrome and she required more support to gain new skills within the home and at childcare than her peers. She detailed the assistance Andie required on a daily basis and how the activities which she required to help her progress would usually take up to an hour per day and needed to be practised, as they are updated and changed as Andie learns new skills or attains strength. She anticipated that Andie would require ongoing physiotherapy until her early primary school years and support to achieve all her physical milestones such as walking, climbing stairs, running, jumping and riding a trike.
36 The Court was told that, as you were the carer for Andie, a sentence of imprisonment would cause exceptional hardship for Andie, as well as your wife and your other child. Mr Lavery stated that your wife is the principal breadwinner and works full time from 9.00am to 5.00pm five days per week in an administrative job in an office where she earns $60,000. You had the primary care of the children, particularly attending to Andie’s very considerable needs and, also, worked part time as a maintenance worker and groundsman for Mr Stephen Cust, who runs a caravan park and other accommodation in Dromana and Rye. Mr Lavery submitted that in circumstances where the family has only one car and your wife uses it to drive herself to work each day and given that Andie’s needs, because of her condition of Down syndrome, are so very significant, your family’s circumstances with you having been her carer amounted to exceptional circumstances, which the Court could take into account and determine that imposing a sentence of imprisonment would cause exceptional hardship. Mr Lavery submitted that there was no one else who could really care for Andie, particularly given that the carer’s pension was only $470 per fortnight. He suggested that, if someone else were to be employed to do what you had to do, it would have to be for 50 hours per week and no one would be prepared to do it for the modest amount of the carer’s pension.
37 I have carefully considered the evidence tendered to the Court by way of the report of Dr Andersson and Ms Green, along with Ms Craig’s reference which states that what you do for your two children is immeasurable, particularly your everyday care for Andie, and that you are a wonderful father. She states that she believes that Andie will be diminished greatly if you are away from her care and development. This would make life for the family near impossible as she would have to leave her work in order to care full time for Andie and she would not be able to afford to raise her children without working.
38 It should be borne in mind that a submission that certain conditions constitute exceptional circumstances is essentially a plea for mercy. Whilst it is recognised that there is always a place in sentencing for the exercise of mercy in appropriate circumstances, the primary function of a sentencing Court is to impose a sentence appropriate to the gravity of the offending. It needs also to be borne in mind that if family hardship, on its own, were to be the basis for exercising mercy, then an offender who had needy members of his family would be treated more leniently than an offender who did not. Hence, this would appear to be unjust. Thus, it has been held that it is only in exceptional cases that a plea for mercy by way of family hardship should be taken into account, as it is almost inevitable that imprisoning a person will have an adverse effect on that person’s family.
39 In this case, it is plain that there is someone who is able to care for your children and, indeed, the Court was told that, if you were to be imprisoned, then your wife proposed to give up her work and be the main carer. Moreover, it became apparent that both her mother and her father lived nearby at Safety Beach. Apart from Mr Lavery saying that they were aged between 70 and 80, he was not able to tell me anything more about them or give any reason as to why they may not assist Ms Craig in looking after the children. If Ms Craig has to give up work, she would be entitled to a variety of Centrelink benefits. Moreover, Andie would be eligible for a package of services under the National Disability Insurance Scheme. Further, there have been references tendered from members of the community at Safety Beach namely, Mr Rogers, Mr Herrick and Ms Reynolds, along with that of your part-time employer, Mr Cust. All of these people speak about how you have helped out others in the community since you have been living in the Safety Beach area and it is difficult to imagine that they would not assist your wife and children if you were not there to care for them.
40 Whilst I accept that Andie has significant challenges, I do note from the material before the Court that she apparently attends childcare on one day per week. Moreover, the report from Dr Andersson is now eight months old and the one from Ms Green is now seven months old. Whilst in no way diminishing the special needs of Andie, it is clear from Ms Green’s report that Andie does have the capacity to learn new skills and attain strength, such that every three or four weeks the supports and exercises which are required change. Andie was born on 6 November 2017 and was aged 11 months at the time of Dr Andersson’s report which referred to her then having the function of a baby some seven months younger. There is no up to date report about what, if any, progress she has made and it is clear that one must not base the exercise of mercy on speculation. However, even if she does still require the level of supervision and exercises outlined in Ms Green’s report over and above that which a normal baby would require, and even though, according to Dr Andersson, she is likely to need ongoing regular physiotherapy and home exercises as well as other medical appointments for her various needs, I do not consider that the evidence meets the high standard of exceptional circumstances such as to call for a more lenient sentence than that which would be required by the objective circumstances of the gravity of the offending.
41 As previously mentioned, a report from Ms Carla Lechner, psychologist, was tendered as Exhibit “1” on the plea. She expressed the view that you currently fulfil the criteria for a diagnosis of Major Depressive Disorder pursuant to DSM-5 and had been commenced on antidepressant medication. She stated, “Whilst his low mood is partly reactive to his pending Court hearing, his history suggests that he has been depressed for many years but has been reluctant to seek professional help.” She noted that when she had seen you on 25 October 2018, you had been prescribed the antidepressant Lexapro and considered that your self-report of symptoms on the Beck Depression Inventory gave you a result in the “extreme” range and on the Beck Anxiety Inventory in the “severe” range. She considered that you needed regular monitoring to ensure you were taking an appropriate dosage of antidepressant and would also benefit by referral to psychological support via a mental health plan. She stated that you reported that you had lost your friends and financial standing and were most concerned about the impact of an immediate jail sentence upon your family. She opined that a period of immediate incarceration is likely to be detrimental to your mental health and to the functioning of your family unit, particularly given the special needs of your young daughter.
42 I found Ms Lechner’s report to be unimpressive in a number of matters. It was unclear upon what she relied in stating that your history suggests that you had been depressed for many years. Apart from anything else, you seemed to have happily re-partnered with Ms Craig who has known you for some seven years and whom you married four years ago. You had been an elite golfer soon after leaving school. According to Ms Craig’s reference, you managed to keep this up and had been a nine time club champion but had given golf away in more recent years to care for your children. She also noted that you were very helpful to others in the community especially the elderly. Mr Rogers’ reference confirmed that in the six years that he had known you, you had played pennant at some of Melbourne’s most prestigious golf clubs and helped out at the golf club generally at Safety Beach and also to assist in charity events, including being Santa Claus for the annual Christmas party. Ms Reynolds’ reference indicated that you helped out with her organisation which conducts food runs for the homeless and that you had done this for approximately four years, once per fortnight. Mr Herrick also referred to this volunteer work, as well as the fact that you mowed the lawns of the elderly and drive some elderly people down the street to do their shopping. I have already referred to the reference of your part-time employer, Mr Cust. He refers to your admirable work ethic and your helping out other staff if needed. None of these references point to a person who is suffering from debilitating anxiety or depression in accordance with your self-report to Ms Lechner. Moreover, at the plea hearing the Court was told by your counsel that you had not been taking any antidepressants for the last couple of months. In all of the circumstances I am not satisfied that there is cogent evidence of any psychological or psychiatric condition over the period of your offending such as to enliven the principles in R v Verdins[2]. Indeed, Ms Lechner comments that your low mood is partly reactive to your Court hearing. It would appear that having been prescribed antidepressant medication some time in the second half of 2018, you have not taken it since some time earlier this year. However, as a matter of common sense I accept that a person who is anxious and depressed and also worried about having let his family down and not being there, in particular to assist with your daughter, Andie, is likely to find imprisonment more burdensome than someone who does not have these concerns. Also, it is possible that imprisonment may impact upon you to worsen your low mood. I accept that having no relevant criminal history, it will not be easy for a man of your age to undergo a sentence of imprisonment for the first time.
[2]R v Verdins; R v Buckley; R v Vo [2007] VSCA 102
43 In your favour, as I have already stated, I take into account your plea of guilty as having significant utilitarian value, even though it was a relatively late plea entered only in July 2018, fairly close to the date upon which your charges had been listed for trial on 29 July 2018. I have already commented that I do hold reservations that your pleas are remorseful. Neither the report of Ms Lechner nor the reference from your wife show full acceptance and acknowledgment of your very serious wrongdoing and, in my view, it is a nonsense to suggest that you intended to repay an increasingly mounting debt in circumstances where, in the past, you had left other labour hire companies with debts owed by you amounting to tens of thousands of dollars.
44 Your primary concern about this offending seems to be the embarrassment to yourself and the impact upon your family. On your behalf your counsel put blame upon Mr Murdoch for your dishonest conduct, event stating that it had been enabled by AB not carrying out a due diligence check on you and your companies and having deficient systems, as though this somehow excused your protracted and persistent premeditated dishonest behaviour. Nevertheless, you are entitled to a significant discount on the sentence which otherwise would have been imposed, had it not been for your pleas of guilty. The utilitarian value of your pleas are high in a case where the prosecutor has told the Court that the evidence comprised some 15 volumes of material.
45 I also take into account that, since the last occasion of your offending on Charge 3 on 27 June 2014, you have not committed any further criminal offences. Your counsel stated that you had had difficulty obtaining employment for four years prior to assuming your role as house husband and primary carer for your children and performing part time maintenance work at the local caravan park. You are now 55 years old and I think it unlikely that you will be in any position to run a business and defraud labour hire companies or anyone else in the foreseeable future. In your favour I note that, since settling in Safety Beach, you appear to be regarded as a community-spirited person who assists others generously and is well regarded. It is certainly difficult to reconcile the description of Ms Reynolds of you as “a man of high moral fibre and a deeply caring person for his fellow human beings” and that of Mr Herrick of you as “a caring and decent man” and “a man of great character” with your deeply dishonest behaviour for which I must sentence you. One would like to think that it is never too late for a person to turn over a new leaf and rehabilitate themselves, even after conducting themselves with egregious dishonesty for a protracted period. Perhaps the support of your wife and the fact of having a new family to care for have brought out a better side of your character. One can only hope so, because it would appear that you have shown scant regard for those to whom you have caused significant financial disadvantage in the past. Provided you steer clear of attempting to run any business, I consider that your prospects of rehabilitation are probably reasonable.
46 Mr Munn, in my opinion your offending has been correctly characterised by the prosecutor, Mr Singh, as very serious offending on a grand scale which was planned and sophisticated and involved false representations and documents over a lengthy period of time for the purpose of obtaining a financial advantage by deception. The prosecution concedes that it is not in a position to prove enrichment on your part, but this simply means the absence of an aggravating factor. As I have already commented, your behaviour resulted in the impoverishment of others and, unfortunately, this seems to have been conduct typical of you as evidenced by your business dealings with other labour hire companies in the years leading up to the offending, even when you were an undischarged bankrupt. You may claim that you intended to trade out of debt, but it simply mounted and mounted and you well knew from your prior experiences in dealing with labour hire companies of the potential adverse impact that your dishonest conduct could have on yet another labour hire company.
47 In all of the circumstances, I consider that there is no sentence appropriate other than a term of imprisonment of an immediate custodial nature. In sentencing you, the court must denounce your conduct and place emphasis upon both general and specific deterrence and just punishment, although I acknowledge that the emphasis required upon specific deterrence now is probably less than some years ago, given your lack of subsequent offending and the evidence of your family and community-oriented lifestyle which bodes well for rehabilitation.
48 I am mindful of the principle of totality in sentencing. However, you have already received the benefit of each charge being a rolled-up charge. In the circumstances I consider that some cumulation is appropriate to ensure that the gravity of your offending on each charge is reflected, that the overall sentence is justly reflective of your offending overall.
49 I consider that some mercy for the sake of your child Andie might be appropriate in the non-parole period which I set, which is also an acknowledgment of your prospects of rehabilitation. For these reasons, the non-parole period is disproportionately low compared to the head sentence.
50 On Charge 1, you are convicted and sentenced to be imprisoned for a period of 14 months.
51 On Charge 2, you are convicted and sentenced to be imprisoned for a period of 2 years.
52 On Charge 3, you are convicted and sentenced to be imprisoned for a period of 5 months.
53 The base sentence is that imposed on Charge 2, namely, 2 years. I direct that 10 months of the sentence on Charge 1 and 2 months of the sentence imposed on Charge 3 be served cumulatively upon the sentence imposed on Charge 2 and upon each other.
54 The total effective sentence is thus 3 years’ imprisonment.
55 I direct that you serve a period of 18 months before becoming eligible for parole.
56 I declare a period of 74 days’ pre‑sentence detention to be time reckoned as already served under the sentences imposed this day.
57 Pursuant to s6AAA of the Sentencing Act, I state that had it not been for your pleas of guilty, the total effective sentence imposed would have been 4 ½ years’ imprisonment with a non-parole period of 3 years.
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