DPP (Cth) v Li
[2000] VSCA 76
•12 May 2000
SUPREME COURT OF VICTORIA
COURT OF APPEAL Not Restricted
No. 331 of 1999
| DIRECTOR OF PUBLIC PROSECUTIONS (COMMONWEALTH) |
| v |
| JAMES JIAN JUN LI |
---
JUDGES: | TADGELL and CHERNOV, JJ.A. and HEDIGAN, A.J.A. | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 13 April, 2000 | |
DATE OF JUDGMENT: | 12 May, 2000 | |
MEDIUM NEUTRAL CITATION: | [2000] VSCA 76 | |
---
Criminal law – Sentencing – Crown appeal – Discharge without proceeding to conviction – Whether manifestly inadequate – Whether undue weight given to effect of conviction on capacity to direct or manage company business – Crimes Act 1914 (C’th), ss.19B(1) and 21E – Corporations Law, s.229
---
APPEARANCES: | Counsel | Solicitors |
For the DPP (Cth.) | Mr. R. Maidment | Commonwealth Director of Public Prosecutions |
| For the Respondent | Mr. J. Searle | West & Co. |
TADGELL, J.A.:
I have had the benefit of reading in draft the reasons that have been prepared by Chernov, J.A. I agree that, for the reasons his Honour has assigned, the appeal should fail. In the circumstances, I have not considered the question whether the appeal was competently brought.
CHERNOV, J.A.:
The respondent who was born in Shanghai on 10 August 1957 and is, therefore, aged 42 years, pleaded guilty in the County Court at Melbourne on 26 November 1999 to two counts of defrauding the Commonwealth contrary to s.29D of the Crimes Act 1914 (Cth.) (“the Act”). The offence carries a maximum penalty of 10 years’ imprisonment or a fine of $100,000 or both. It was alleged that the respondent took part in business transactions entered into by a business which I shall call “H” between 11 July and 18 November 1994 (count 3) and by a business which I shall call “W” between 11 November 1994 and 28 July 1995 (count 5) for the purpose of avoiding the obligation to remit sales tax under the Sales Tax Assessment Act 1992 (“the Sales Tax Act”). During most of this period the respondent was in the employ of a company which I shall call “A&B Pty. Ltd.” which was owned and controlled by two brothers whom I shall call “A” and “B” respectively. It is alleged that between May 1993 and February 1996 A and B devised and put into effect a fraudulent scheme that was designed to avoid the payment of sales tax that would otherwise have been payable in relation to the sales of computers that were made by their company. The scheme operated through several sham businesses, including H and W, which were controlled by A and B and which they interposed between A&B Pty. Ltd. and the ultimate innocent retailer. It is claimed that by reason of such fraudulent interposition of H and W, the Commissioner of Taxation was defrauded of sales tax revenue amounting to approximately $160,000.
It is not necessary to set out in any detail the operation of the Sales Tax Act or of the fraudulent scheme said to have been devised by A and B. It is sufficient to say that, so far as the legislation is concerned, it requires that sales tax be charged at the applicable rate on the last wholesale sale of certain goods manufactured in or imported into Australia. This is usually at the point where goods are sold by the wholesaler to the retailer. Because relevant goods may be the subject of several sales between consecutive wholesalers before they reach a retailer, the Sales Tax Act provides an exemption mechanism that allows sales tax liability to be deferred until the last sale by a wholesaler (to a retailer). The exemption operates in the following way. A wholesaler may become registered under the Sales Tax Act and thereby be allocated a sales tax exemption number. Where the wholesaler purchases goods from another wholesaler, instead of paying sales tax in respect of those goods, the wholesaler merely quotes the sales tax exemption number to the seller, thereby deferring the obligation to pay the tax. If the wholesaler re-sells the goods to a retailer, sales tax is payable at that point. If the goods are re-sold to another wholesaler, that purchaser pays the sales tax unless it can quote a sales tax exemption number to the wholesale seller.
So far as the scheme is concerned, A&B Pty. Ltd. was at all relevant times a wholesaler of computers. In the normal course of events, where it supplied computers to retailers, it was required under the Sales Tax Act to collect the sales tax payable by the retailer and remit the amount collected to the Commissioner. It is alleged that in an attempt to avoid collecting and remitting the sales tax applicable to the goods sold by the company, A and B interposed a number of allegedly sham businesses between the company and the innocent retailer which had no reason for existence other than to facilitate the deferral of payment of sales tax and its ultimate non-payment. As I have mentioned, H and W were two of such businesses. The real vice in the scheme lay in the fact that the registered proprietors of the interposed businesses were persons who were not present in Australia and against whom an enforcement of liability for sales tax would have been almost impossible to achieve. Each of the businesses acquired a registered sales tax exemption number and, in the prototype transaction, the business in question purchased computers from A&B Pty. Ltd., quoting the exemption number. A&B Pty. Ltd. thereby avoided the responsibility of remitting sales tax in respect of the transaction. Having acquired the goods from the company, the business on-sold them to an innocent retailer at a competitive price pursuant to an invoice which showed that sales tax was included in the sale price (whereas in fact it was not charged because there was never any intention, so it is alleged, to remit any money to the Commissioner by way of sales tax in respect of that sale). No sales tax returns were ever filed by H or W with the Commissioner and no sales tax was remitted by them. Thus, the innocent retailer purchased computers from H or W believing that it had paid sales tax in relation to those goods whereas no such tax was included in the purchase price.
It seems that other wholesalers in the computer industry were trading pursuant to similar schemes. During 1994 the Australian Taxation Office (“the ATO”) commenced investigations in relation to suspected sales tax evasion in the industry and in the course of those inquiries the respondent attended a voluntary interview with ATO officers in February 1995. Initially he denied involvement in the businesses in question, but later admitted signing relevant documents. The ATO’s inquiry in relation to H and W was subsequently referred to the Australian Federal Police (“the AFP”) for criminal investigation. Following extensive investigation, six persons, including the respondent, were arrested and charged between March and August 1998 in relation to the above-mentioned scheme. The respondent was arrested on 7 August 1998 and charged with three counts of defrauding the Commonwealth. All the accused were joined in a committal proceeding conducted over 10 days in the Magistrates’ Court at the conclusion of which the respondent was committed for trial and entered a plea of not guilty to one charge and reserved his plea on two further charges. At the arraignment before a judge of the County Court on 25 August 1999 the defendant pleaded guilty to the two counts referred to earlier.
In the period between being committed for trial and his arraignment, the respondent participated in a series of interviews with the AFP, some of which were attended by ATO officers. A statement was subsequently prepared based on the contents of those interviews and was signed by the respondent. It contains a detailed description of the operation of H and W as the respondent understood it, including his own role in the businesses. The respondent also undertook further to assist in the prosecution of his former co-defendants, including giving evidence at their trial if called upon to do so. Apparently, the trial is likely to be listed for hearing some time in the middle of this year.
As to matters personal to the respondent, he first came to Australia in June 1990 on a student visa. He spoke almost no English but began learning the language at a commercial school which closed down in mid-1991 by which time he still had little command of English. During this period and thereafter, the respondent also worked at several semi-skilled jobs. He returned to China in March 1993 in order to resume working in the business with which he had been involved, but came back to Australia in May 1994.
In June 1994 he gained employment at a computer shop which was operated by Ma Li whom he had met while he was studying in Australia and with whom he shared a flat after his return from China. There, he learned about various technical aspects of making computers, although his primary role was concerned with the delivery of goods, banking and like activities. In about July 1994 he commenced employment with A&B Pty. Ltd. where he worked until June 1995. The respondent had met A and B on a number of occasions when he collected goods from or delivered goods to the company while he was still working for Ma Li. When he started work with A&B Pty. Ltd., his initial duties were similar to those which he performed for Ma Li, namely, moving stock in the warehouse, collecting and delivering goods, banking and general work as a clerk. As he continued to work with that organisation his responsibilities broadened. He wrote out invoices, quoted prices to purchasers over the telephone and accepted purchase orders that came in. It is common ground that in respect of nearly all of this work the respondent acted under instructions from his superiors. For example, he did not determine or take part in determining prices, but quoted them from a list that was supplied to him by A or B or one of their assistants.
At A&B Pty. Ltd. the respondent also completed various documents relating to H and W. For example, he signed a form in relation to H which showed him as its proprietor for a short period. He also signed documents which related to the application by H for a sales tax exemption number, and he completed, in his hand, purchase order forms on behalf of H and W that were directed in most cases to A&B Pty. Ltd., some being backdated at the request of his superiors. The particulars that were provided on the order forms as well as the forms themselves were usually supplied to the respondent by or at the behest of A or B. In the same manner, the respondent completed handwritten sales invoices pursuant to which H and W sold, to innocent retailers, computers which were acquired from A&B Pty. Ltd.. The invoices stated falsely that the sale price included sales tax. The respondent was also involved in banking transactions of the various entities controlled by A and B. Thus, for example, he completed numerous bank deposit slips and attended to the banking of cheques and cash. He also completed payee details on various cheques without signing them, except in the case of cheques drawn on the account held by H at the Chadstone branch of the ANZ Bank after late September 1994. The respondent became signatory to that account in late September 1994 in circumstances where A and B told him that they wished him to replace the then sole signatory on that account because, in effect, they could not rely on him and they wished the respondent to “control” it. It seems that they offered to pay him $3,000 for taking on the extra responsibility but also added that if he declined, he would be dismissed. Thus, the respondent became the signatory to that account, received from time to time the bank statements in relation to it which were then submitted to the company accountant. He was also paid $3,000 for this so-called additional work.
It is common ground that the respondent was involved only on the periphery of the operations of H and W and acted as a clerk or messenger at the direction of his superiors. It seems clear enough that at A&B Pty. Ltd. he was on the lowest rung of the organisational ladder and never had it explained how the scheme operated or how the transactions in which he was involved fitted into the overall fraudulent scheme. He was not told, for example, why sales invoices had to be completed by hand when it would have been easier and more efficient to produce a computer generated document. It also seems that the respondent had no authority to take any initiative or independent action in relation to sales or purchases of computers or in respect of the documentation that pertained to those transactions. The respondent’s English at that time was still poor; he had a relatively low level of spoken English and even a lower level of written English. He had no real understanding of the legal requirements that applied to the businesses including the obligation to remit sales tax returns to the Commissioner and the sales tax payable in relation to sales of computers to retailers.
Although initially, the respondent did not suspect any wrongdoing on the part of A or B, later during the course of his employment he apprehended that it was wrong for him to sign some of the documents although it seems that he had no knowledge as to why that might be so. He was anxious not to lose his job and, consequently, did not raise with A or B the growing concern that he was experiencing as time went on. He was still new to this country and, as he saw it, the prospect of finding alternative employment was not sound.
In 1995, the respondent left A&B Pty. Ltd. and, in 1996, set up with another person a company called Arch Tech Group International Pty. Ltd., which became involved in computer sales. Later, he bought out his partner and at the time of his sentencing, the respondent was the sole director of the company. His Honour noted that the turnover of the company increased between 1996 and 1998 from $300,000 to something in the order of $13½m per annum. There was uncontradicted evidence before his Honour that the company paid all its liabilities, including sales tax from the time of its inception. It also seems from the evidence that the respondent is a responsible citizen who conducts a successful business employing eight persons. He married in Australia in 1997 and his wife apparently works in a company which is unrelated to any of the respondent’s business activities. He is a naturalized Australian and has parents and a brother in China, who are, as his Honour observed, apparently not in any immediate financial need.
In his sentencing remarks, his Honour noted, inter alia, that the respondent’s degree of culpability was at a low level, that he was not part of the governing mind of the scheme and that he obtained no relevant financial benefit from it. His Honour also said that he had regard to the extent of the respondent’s rehabilitation, including his plea of guilty, the assistance given by him to the authorities and his undertaking to co-operate with them in the future. His Honour then referred to s.21E of the Act and said this: “I will say to you that but for your co-operation and activity pursuant to that section [sic], you would have served a sentence of at least six months for these crimes, custodially and without the benefit of a recognisance release.”
During the hearing of the plea in mitigation, his Honour was referred to a number of cases, most of which were decided by the County Court and which dealt with the sentencing of persons who pleaded guilty in relation to sales tax fraud perpetrated in the computer industry. In particular, it was said that four such cases were in many respects similar to the present one. But his Honour considered that the case before him involved considerations that set it apart from the cases that were cited to him. In particular, the learned judge noted that if the respondent were convicted then, by operation of ss.91A and 229 of the Corporations Law, he would lose his directorship and capacity to manage his company. His Honour concluded that such a consequence would result in a penalty for the two crimes to which he pleaded guilty which would not be in accord with the proper principles of proportionality as between crime and punishment. The learned judge considered that the matter could be fairly dealt with “having regard to all sentencing purposes” by dealing with the respondent under s.19B of the Act. His Honour found that he was satisfied of the matters set out in s.19B(1)(a) and (b) and ordered that the respondent be discharged without proceeding to conviction.
The Commonwealth Director of Public Prosecutions (“the DPP”) has appealed against the decision of his Honour on four grounds, one of which was abandoned prior to the hearing of the appeal. The three remaining grounds were:
“1.The sentences on each count of discharging the Respondent without conviction pursuant to section 19B of the Crimes Act 1914 are manifestly inadequate having regard to all the circumstances and different sentences should have been passed.
2The learned sentencing judge erred in that he gave undue weight to the Respondent’s undertaking to assist law enforcement agencies and give evidence for the Crown in the prosecution of others. The undue weight accorded to this undertaking by the sentencing judge resulted in the Respondent receiving a discount on the sentences that would otherwise have been passed which was too large having regard to all the circumstances.
3.The learned sentencing judge erred in exercising the discretion conferred by section 19B of the Crimes Act 1914. There was no relevant matter that the learned sentencing judge was entitled to accord such weight as to provide a sufficient basis for applying the provisions of section 19B of the Crimes Act 1914.“
Grounds 2 and 3
At the hearing of the appeal, it was made plain by Mr. Maidment, who appeared for the DPP, that, in his submission, his Honour’s sentencing error lay in discharging the respondent without proceeding to conviction. He did not seek to argue that his Honour should have sentenced the respondent so that he would have, in fact, served a term of imprisonment. Rather, he submitted, the respondent should have been convicted and had a fully suspended term of imprisonment imposed upon him. It was said that his Honour erred principally in giving undue weight to the effect that s.229 would have on the respondent if he were convicted.
That his Honour gave undue weight to the likely effect of s.229 on the respondent was evident, it was submitted, from the following factors. First, it was said that his Honour, in effect, “double counted” the effect of s.229 on the respondent if he were convicted. Mr. Maidment submitted that in determining for the purposes of s.21E what sentence (“the head sentence”) he would have imposed on the respondent but for his undertaking to co-operate with the authorities, his Honour must have taken into account, inter alia, the likely effect of s.229 on the respondent. It was said that the head sentence would have been greater had s.229 not been so taken into account. It was then argued that when his Honour came to consider what sentence should in fact be imposed on the respondent and whether he should exercise his discretion under s.19B(1) of the Act, his Honour again took into consideration the effect of s.229. Thus, it was said, his Honour effectively “double counted” s.229, thereby giving undue weight to it.
In my view, however, even assuming that his Honour took into account the impact of s.229 on the respondent in both instances, that does not, by itself by itself, demonstrate that his Honour gave undue weight to that factor in the sentencing context. The determination by the learned judge of the head sentence and the period of its reduction for the purposes of s.21E(1) is a materially different task from the exercise of discretion by him under s.19B(1) for the purpose of determining whether a conviction should be recorded. The effect of the badly drafted s.21E(1) is to require the sentencing judge to state, in the circumstances contemplated by it, the term of the notional head sentence that he or she would have imposed but for the relevant undertaking and then to attribute a stated portion of that term to the fact that the undertaking was given for the purpose of notionally reducing the head sentence to the one that is in fact imposed. Thus, an artificial process is imposed upon the sentencing judge which runs counter to the fact that the sentencing involves the judge’s intuitive and instinctive synthesis of all facets of the sentencing process as was recognised by Adam and Crockett, JJ. in R. v. Williscroft[1] where their Honours said this:
“Now, ultimately every sentence imposed represents the sentencing judge’s instinctive synthesis of all the various aspects involved in the punitive process. Moreover, in our view, it is profitless . . . to attempt to allot to the various considerations their proper part in the assessment of the particular punishments presently under examination . . .
We are aware that such a conclusion rests upon what is essentially a subjective judgment largely intuitively reached by an appellate judge as to what punishment is appropriate. Indeed, in R. v. Geddes (1936), 36 S.R.(N.S.W.) 554, Sir Frederick Jordan, C.J., was sufficiently oppressed by the problems of seeking a rational principle for determining whether a sentence was inadequate, that he was able to find a solution only in the employment of an epigrammatic device. After pointing out that it was easier to see when a wrong principle has been applied than to lay down rules for solving particular cases, the learned Chief Justice observed that ‘ . . . the only golden rule is that there is no golden rule’”
The task that is so imposed on the sentencing judge has no relevant connection with the exercise of discretion under s.19B(1). The latter requires the judge to have regard to the matters in sub-para.(b)(i)-(iii) for the purpose of determining if it is inexpedient to punish the person as well as all other relevant matters for the purpose of deciding whether to discharge the person without proceeding to conviction.
[1][1975] V.R. 292 at 300
Thus, as I have said, even if his Honour took into account the likely effect of s.229 upon the respondent both for the purpose of determining the head sentence and for the purpose of exercising his discretion under s.19B(1) that would not necessarily constitute, in my view, the giving of undue weight to that provision for sentencing purposes.
I digress to mention that I have some doubts as to the utility of the sentencing judge being required by s.21E(1) to specify the matters set out in that provision where the decision has been made to discharge the person without conviction pursuant to s.19B(1)(d). The purpose behind the requirement contained in s.21E(1) that a notional head sentence be fixed seems to be that if, after being sentenced, the person fails without good reason to co-operate with the authorities, the sentence may be increased in accordance with sub-ss.(2) and (3) to that which the sentencing judge would have imposed but for the relevant undertaking. Where, however, the person is discharged without conviction and then fails to comply with the undertaking, he or she is liable to be dealt with under s.20A(5) rather than s.21E(2) and (3). If that is so, the person would not be re-sentenced by reference to any notional head sentence that has been determined pursuant to s.21E(1) because s.20A(5) makes no provision for it. On the contrary, s.20A(5) provides its own manner of dealing with the situation. Consequently, in those circumstances, there seems to be no point in the sentencing judge making the statement that might otherwise be called for by s.21E(1).
Be that as it may, in considering whether his Honour gave undue weight to the effect that s.229 might have on the respondent if he were convicted, it is also necessary to have regard to the context in which his Honour concluded that no conviction should be recorded. His Honour’s starting point in considering this matter was the apparently agreed position between the parties that any term of imprisonment that might be imposed on the respondent in relation to the offences would be wholly suspended. Thus, so far as his Honour was concerned, it was then only a question of whether it would be appropriate to impose such a sentence on the respondent after entering a conviction or whether, in all the circumstances, it was more appropriate to deal with him under s.19B(1). In those circumstances, it seems to me that there is little scope for saying that undue weight was given by his Honour to the likely effect of s.229 on the respondent. (I note that Mr. Maidment did not argue that, in considering whether s.19B(1)(d) should be invoked, his Honour failed to take into account other relevant factors such as those in the relevant paragraphs of s.16A(2) or that he was not properly satisfied that the requirements of s.19B(1)(b) have been made out.)
The second factor to which Mr. Maidment pointed as evidencing that his Honour gave undue weight to s.229 was that he failed to consider other options which may have been open to the respondent to enable him to continue to operate his computer selling business other than under the umbrella of his company. It was said that no reason was put forward on the respondent’s behalf to suggest that he could not have continued successfully to conduct the business of the company as an individual or in partnership under a business name and thereby avoid any adverse effect of the operation of s.229. In my view, however, quite apart from the fact that the DPP did not submit to his Honour or suggest to the respondent in cross-examination that he could avoid the adverse effects of that provision merely by trading as an individual, this submission has no merit. It is wholly impractical for a number of reasons. First, as Mr. Searle, who appeared for the respondent submitted, it would take a considerable time to transfer the operation of the company and its assets and liabilities to the respondent. In the meantime, the respondent could take no part in the management of the business if he were convicted, the likely result being that the company’s operations would be forced to close. Next, the numerous and practical difficulties of transferring to the respondent the assets and liabilities of the company not all of which were under its control (such as leases of equipment and premises) are self-evident and need not be elaborated upon.
The third reason why it was claimed that it was evident that his Honour gave undue weight to the effects of s.229 on the respondent, was that his Honour exercised his discretion under s.19B for only one reason, namely, to avoid the operation of the provision in relation to the respondent. While it is true that his Honour was very concerned about the effect of s.229 on the respondent if he were convicted and considered that, in the circumstances, a conviction would amount to punishment that would be disproportionate to the gravity of the crime, he nevertheless had regard to other relevant matters which, in his view, called for the exercise of his discretion under s.19B(1)(d). In particular, it is clear from his Honour’s sentencing remarks that in so exercising his discretion he had regard to the relevant matters listed in ss.16A(2) and 19B(1)(b). Avoiding the operation of s.229 in respect of the respondent may have been a main reason why his Honour exercised his discretion under s.19B(1)(d) as he did, but for the reasons given, it was not the only reason for that conclusion.
Thus, in my opinion, the DPP has not shown that his Honour erred by giving undue weight in his sentencing considerations to the effect of s.229 on the respondent.
It was next argued by Mr. Maidment that, in considering by how much the head sentence should be reduced because of the respondent’s undertaking to co-operate with the authorities, his Honour impermissibly took into account factors other than the undertaking itself. It is clear enough from his Honour’s judgment that the effective reduction in the notional head sentence was “at least six months”. Irrespective of the doubt that I have expressed about the operation of s.21E in the context of this case, it is my view that there is nothing in his Honour’s judgment which suggests that he took into account factors other than the respondent’s undertaking for the purpose of determining the length of the head sentence and, its relevant reduction.
The DPP further contended that, in concluding that the respondent should be discharged without conviction, his Honour gave undue weight to the respondent’s undertaking to co-operate with the authorities. This point was not developed by Mr. Maidment in argument but in any event, in my opinion there is nothing in his Honour’s judgment which gives support to that contention or to any claim that undue weight was given by his Honour to the respondent’s undertaking to co-operate in the context of determining the notional reduction in the head sentence for the purposes of s.21E(1).
Thus, in my view, grounds 2 and 3 must fail.
Ground 1
The DPP submitted in the form of a written outline of submissions that the sentence imposed by the learned judge fails to take into account sufficiently the elements of general deterrence and was, in any event, manifestly inadequate particularly having regard to the sentence imposed in other comparable cases.
In my view, the argument that his Honour failed to take into account sufficiently the elements of general deterrence, was but another facet of the DPP’s contention that the sentence was manifestly inadequate. Before turning to this contention, I should say that I doubt whether general deterrence had a significant role to play in this case. The respondent was a very minor operator within the scheme and any sentence imposed on him along the lines advocated by the Crown was unlikely to act as a deterrent to those who instigate and/or control fraudulent schemes of the type that was involved in this case. In any event, as Mr. Searle submitted, to the extent that the principle of general deterrence is relevant in this case, it is likely to have been satisfied by the imposition of the order that the respondent pay the costs of the DPP up to $35,000. This amount represents approximately one year’s salary of the respondent and would constitute a significant detriment to him and to those who are likely to participate in such a fraudulent scheme broadly at the level at which the respondent participated. In my view, it has not been demonstrated that his Honour so failed to take into account the principles of general deterrence when determining the sentence, or that the sentence imposed by his Honour is manifestly inadequate.
It was argued by the DPP that, given the circumstances of this case and having regard to the sentences passed in comparable cases, discharging the respondent without conviction was a manifestly inadequate sentence. It was contended that it would have been appropriate at least to have convicted the respondent having regard to the gravity of the offence, more particularly the signing off by him of the sales tax registration application, controlling the bank account of H and producing effectively false invoices even after he became aware that what was being done was unlawful. Moreover, it was said, he accepted wages (which were higher than he could otherwise command) when he knew that there was something unlawful about the activities in which he was engaged. Furthermore, he received a cash payment of $3,000 for managing the bank account of H. Thus, it was said, he gained some profit albeit not a share of the profits of the enterprise. Moreover, his participation in the fraudulent scheme was material and he should have been sentenced accordingly as submitted on behalf of the Crown. All this demonstrated, so it was claimed, that the sentence is manifestly inadequate.
The eight cases on which the DPP relied to support the contention that the discharge of the respondent without conviction was not an appropriate order, are of only minor assistance because, for present purposes, it is obvious that each case turned on its own facts and there are many distinguishing differences between the respondent’s situation and that which prevailed in each of the cases put forward by the DPP. In those cases, each accused played an active role in implementing the scheme; in some of them he had devised it. All had full command of the English language and an appreciation of the relevant law, even if only in lay terms, and knew from the outset that the scheme was fraudulent. They all participated in it with a view to making a profit. The respondent here, on the other hand, did not appreciate when he commenced working for A and B that they were engaged in a fraudulent scheme. Even though he later apprehended that there was something unlawful about some aspects of his activities, it has not been suggested that he knew the particulars or the extent of the fraud involved in the scheme’s operation. He was reluctant to confront his “boss” and seek an explanation. That reluctance is understandable, given the hierarchical structure of the society in which he lived, the gulf between him and the owners of the business, his poor command of the English language, all of which limited his alternative job opportunities, and his lack of knowledge of the precise nature of the unlawfulness of the activities. On any view, the respondent seems to have been on the periphery of the scheme and was confined to performing relatively menial tasks. Further, as Mr. Searle submitted, the respondent was given a plausible explanation for the request that he take over the operation of the bank account, and the payment of the $3,000 was made as an acknowledgment of his added responsibilities which arose out of the management of the bank account. As Mr. Searle pointed out, as events turned out the respondent signed very few cheques and usually his principal role was confined to filling in cheques for signature by his superiors.
There are other factors which operate in favour of the respondent in the context of assessing whether the sentence imposed or the order made by his Honour was beyond range. Thus, the respondent took no part in devising the scheme; it appears that he was not motivated by greed in doing what he did and he did not relevantly profit from it. Furthermore, the respondent has shown remorse, has pleaded guilty and has assisted the authorities in their investigation of the fraud. He has undertaken to assist the authorities further in the prosecution of his former co-defendants and, in that respect, it is expected that he will give evidence against them at their forthcoming trial. The respondent is therefore entitled to a very substantial sentencing discount by reason of those matters (R. v. Duncan[2]). Moreover, given the relatively small and hierarchical community to which the respondent and his former co-defendants belong, the respondent’s meaningful assistance to the authorities must have been, and possibly will be, to some disadvantage for him. There are also other matters to which I have already referred which point to the respondent having achieved rehabilitation, principally through his own efforts during the four and a half years or so since he left A&B Pty. Ltd. In all the circumstances, a conviction might have had a detrimental and unfair impact on the rehabilitation that the respondent has achieved. This is clearly a relevant factor to be put on the scales (R. v. Bell[3]). Moreover, as I have mentioned, the offence was committed almost five years ago and was one in respect of which he had a low level of culpability. The long period between the offence and the ultimate disposition of the case can be properly taken into account in their sentencing considerations (R. v. Miceli[4]). It should also be borne in mind in this context that the respondent was not just discharged without conviction; he was effectively fined in the vicinity of $35,000 which was equivalent to his wages for one year. This is yet another relevant consideration on the question of the adequacy of the sentence imposed on the respondent.
[2][1998] 3 V.R. 208 at 215 per Callaway, J.A.
[3][1999] VSCA 223 at [24] per Callaway, J.A.
[4][1998] 4 V.R. 588
It has been said in numerous cases that the question whether a sentence is manifestly excessive or manifestly inadequate does not admit of much argument. The sentence in question either strikes one as being manifestly out of the ordinary or it does not, but in considering the matter, it is necessary to ensure that this Court does not substitute its view of the matter for that of the trial judge. It is only if the trial judge erred in the matter of principle or was wholly wrong that his decision can be interfered with by an appellate court.
It is necessary to bear in mind in considering whether the Court should interfere with this sentence on the basis that it is manifestly inadequate, that this is a Crown appeal in relation to sentence and it is well established that the Court is slow to interfere if a sound basis for the exercise of the sentencing discretion can be discerned - see R. v. Clarke[5] where the principles which apply to Crown appeals are summarised by Charles, J.A.[6] In DPP v. Carter[7] which was concerned with a Crown appeal against sentence, the President repeated[8] what he had said earlier in another similar case, namely, that s.567A of the Crimes Act “is not intended to give the court power to lightly interfere with the judge’s exercise of sentencing discretion. A successful appeal will be the exception rather than the rule.” It is my view that, in the circumstances of this case, it could not be said that the order made by his Honour was not open for him to make in the proper exercise of his sentencing discretion. Although the sentence was lenient, it was, in the context of this case, within the range of sentences that were reasonably open to his Honour to impose.
[5][1996] 2 V.R. 520
[6]at 552
[7][1998] 1 V.R. 601
[8]at 604-5
Consequently, ground 1 also fails.
I mention for completeness that in the course of the hearing of the appeal, the question was raised whether this Court had jurisdiction to entertain it. Neither counsel was in a position to deal with the issue during the hearing although thereafter each provided to the Court short and helpful written submissions in relation to it. In my view, however, since the matter was not fully argued and, in any event, having regard to my conclusion as to the merits of the appeal, it is neither necessary nor desirable to express a concluded view on this important issue.
Thus, in my view, for the reasons I have given, the appeal should be dismissed.
HEDIGAN, A.J.A.:
I agree that this appeal should be dismissed, for the reasons given by Chernov, J.A. which I have read in draft form. I prefer to express no opinion on the jurisdiction question as no developed argument was presented in the course of oral submissions, and because the appeal fails, even if there is jurisdiction.
---
6
0
0