Elizabeth Macias Keeley v Department of Social Security No. SCGRG 93/1093 Judgment No. 4075 Number of Pages 7 Criminal Law Social Security Offences

[1993] SASC 4075

COURT IN THE SUPREME COURT OF SOUTH AUSTRALIA MULLIGHAN J

CWDS
Criminal law - Social security offences - continuing to receive Sole Parent Pension after marriage - lengthy period of offending - Filipino woman with a child - good character - life of poverty and abuse - sentence of imprisonment for fourteen months with order for release after five months upon entering into a bond - appeal against sentence - importance of general deterrence - need to also consider personal mitigating circumstances - failure to do so by learned Special Magistrate - sentencing discretion miscarried - head sentence confirmed - order for immediate release upon entering into bond. Taormina v The Queen (1980) 24 SASR 59, R v Vasin; R v Scherf (1985) 39 SASR 45, R v Schneider (1988) 37 A Crim R 395, R v Cameron and Simounds (unreported, 19th July 1993), Scott v Cameron (1980) 26 SASR 321, Wood v Samuels (1974) 8 SASR
465 and Elliott v Harris (No 2) (1976) 13 SASR 516 referred to. Crimes Act1914 (Cth) s.16A.

HRNG ADELAIDE, 14 July 1993 #DATE 30:7:1993
Counsel for appellant:     Mr J F Kelly
Solicitors for appellant:    Legal Services Commission
Counsel for respondent:     Mr M Loftus
Solicitors for respondent: Director of Public
   Prosecutions

ORDER
Appeal allowed.

JUDGE1 MULLIGHAN J This is an appeal against the sentence imposed upon the appellant for offences against the Social Security Act 1991 (Cth.). She pleaded guilty on 27th May 1993 before a learned Special Magistrate in the Magistrates Court (Criminal Division) to twenty-six counts of obtaining an instalment of a Sole Parent Pension under the Act when she was not entitled to that pension having married on 10th January 1992. The charges cover the period from 16th January 1992 to 31st December 1992 and she received a total of $11,348.10 to which she was not entitled. She was sentenced to imprisonment for fourteen months but an order was made that she be released after serving five months and upon entering into a recognizance in the amount of $10.00 with a conditon that she be of good behaviour for two years. It was further ordered that she make reparation in the sum of $11,358.10. The sole ground of the appeal is that the sentence is manifestly excessive and it became apparent during the hearing of the appeal that the complaint is not about the sentence of imprisonment but that part of it must be served. The appeal is against the refusal of the learned Special Magistrate to order the immediate release of the appellant. 2. Without doubt the learned Special Magistrate took a very serious view of the appellant's offending and he was clearly entitled to do so. The offending occurred over nearly a year and the appellant received a substantial sum to which she is not entitled and which she has little prospect of repaying except over a very long period of time. The learned Special Magistrate placed great emphasis upon general deterrence. He said:
    "As I have said earlier this morning (apparently
    referring to remarks made by him in another case), there is
    and always will be a limit to the amount that is available
    to those who are in need of the assistance of benefits of
    one sort or another. The money that is available comes from
    the taxpayer, it is not grown on a tree in Canberra. The
    fund needs to be protected not only for the protection of
    those who contribute to it, but more importantly for the
    protection of those who are dependant on it." 3. The appellant is aged thirty-four years. She has one child, a boy, aged nine years who, I expect, is dependent upon her and has always been cared for by her. She has no previous convictions. As, in my view, features of the background of the appellant should have been of considerable importance in the exercise of the sentencing discretion, I refer to information placed before the learned Special Magistrate in some detail. 4. Throughout her life the appellant has lived in poverty. She was born, and lived most of her life, in the Philippines. She was raised in a family of fourteen children. Both parents and four siblings are deceased. Her mother died on 5th February 1992. All of the remaining members of the family, apart from the appellant, live in the Philippines. She was educated to the standard equivalent to year 11 and worked as a cleaner at the school as part payment of school fees. She completed her education when aged twenty-two years as it had been interrupted due to poor financial circumstances. She returned to her family. Both parents were ill and she was wholly occupied in caring for them and the other children. Due to the poverty of her family, the appellant, when in her early twenties, prostituted herself to a wealthy man to provide for her family despite her initial naivity as to sexual matters. Her son is a consequence of that relationship. When the relationship ended, she considered working as a prostitute in Japan but was informed that a solution to her problems could be in an arranged marriage with an Australian man. She joined a "pen-friend" club and became friendly with such a man who was aged in his early seventies. She married him in 1986 and commenced to live with him, and her son, in Australia in 1987. The marriage was characterized by the violence of her former husband who regularly and severely beat her and the child. Police became involved and encouraged her to move away. She did not want her former husband to be charged with criminal offences. Her life of poverty continued with this man. He paid to her only 50 cents each week, although he was receiving additional social security benefits due to her cohabitation with him. Shortly after she left the home, her former husband attended at her place of residence and stole her clothes from the washing line and a quantity of blankets and other essential items which had been given to her by the Salvation Army. Police encouraged her to change residence yet again to escape the attentions of her former husband. Eventually, the marriage was dissolved. The appellant obtained the Sole Parent Pension. She found new accommodation owned by her present husband. She paid rent to him and friendship between them developed. In January 1992 she learned that her mother was ill in the Philippines. She received an urgent request for financial assistance. Medical services had to be paid for in cash in advance. The appellant travelled to the Philippines to see her mother. Treatment was being withheld from her and the family could not pay for the required treatment. She borrowed money for that purpose. Her mother died on 5th February 1992 and the hospital refused to provide a death certificate or to release the body for burial until all hospital and medical expenses had been paid. The appellant borrowed additional funds to pay these expenses and took out yet another loan to pay the funeral expenses. She could not afford to stay in the Philippines and could not attend the funeral. She returned to Australia owing in excess of $10,000. 5. In addition to the financial demands earned by the illness of her mother, the appellant had been attempting to support various cousins in the Philippines. She received many letters begging assistance and she was determined to do what she could to prevent cousins becoming prostitutes in Japan as others had done due to their poor circumstances. So, she regularly sent money to support two of her cousins and she paid their school fees and other education expenses for them. From the time of her recent marriage, the appellant sent nearly all of the pension to the Philippines to repay the debts and to support cousins. She did not notify the Department of Social Security of her marriage and when questioned by officers of the Department, she promptly confessed her wrongdoing. She acknowledged that she knew what she had been doing was wrong and she expressed contrition. The appellant continues to be in poor financial circumstances. She has local debts of about $5,000, including an amount of $2,000 to Telecom Australia, mainly caused by reverse charges telephone calls from relatives in the Philippines. She receives $5 per fortnight from the Department by way of family allowance after an amount is withheld by the Department and applied towards repayment of the amount wrongly received by her. Her husband is employed and is purchasing their family home which is subject to three mortgages. He has no monies available at present to apply to repayment of the amount due to the Department, but soon he will no longer have the obligation to pay $50 per week for the maintenance of his child and he intends to pay that amount to the Department. 6. The appellant has completed two TAFE courses to qualify her for employment in preparation of food or as a room attendant, but she is prejudicial in obtaining work due to her difficulty in speaking English. She is a deeply religious woman and has felt obliged to send her son to a Catholic School. She is unable to pay all of the school fees and provides assistance to teachers and in the tuck shop as, in effect, part payment of fees. She works all of each school day at the school. She has no previous convictions and is deeply contrite and remorseful. It was submitted on her behalf that the offences were committed out of need and not greed and her husband could not adequately discharge her obligation to care for her child. Also, there was insufficient funds available to pay the child care fees for the child after school. Counsel for the respondent did not dispute any of this information before the learned Special Magistrate. 7. The learned Special Magistrate took the view that there was no real difference between the appellant's offending and repeated offences of larceny except, perhaps, that her offences are easier to commit. He went on to say:-
    "The easier an offence is to commit, the more it may
    require firm discouragement. This sort of pension is
    available to those who need it to help support a child. It
    is not there to be dishonestly diverted for the payment of
    medical expenses, funeral expenses, private school fees or
    as far as I can tell any of the defendant's purposes. I
    give her credit for her pleas of guilty. She has no history
    of dishonesty, but she well and truly made up for that
during 1992." 8. It may be seen that there are many features of the personal circumstances of the appellant which excite considerable sympathy. It has been established, in my view, that she has been a person of good character. The fact that she has no previous convictions is evidence of good character in a negative sense: there is nothing known against her. However, her dedication to her immediate and extended family is evidence of good character in a positive sense. She is a woman who has endured considerable deprivation and yet worked hard for the benefit of others, which is compelling evidence of her good character. I think the learned Special Magistrate was quite wrong to dismiss her good character in such an off-handed way. 9. S.16A of the Crimes Act 1914 (Cth.) dictates the matters to be taken into account in passing sentence. The Court is obliged to impose a sentence that is of a severity appropriate in all the circumstances: s.16A(1). Among the matters set out in s.16A(2), which the Court must take into account, are the following:- the degree to which the offender has shown contrition; the plea of guilty; the degree to which the offender has co-operated with the investigators of the offence; the question of personal deterrence; the character, antecedents, age and means of the offender; the prospect of rehabilitation; the probable effect that any sentence would have on the offender's family or dependants. There is no mention by the learned Special Magistrate in his remarks on sentence to any of these matters apart from the plea of guilty and an oblique reference to an aspect of her character in that she has no history of dishonesty. Of course, it must be acknowledged that the learned Special Magistrate was speaking extempore and because he did not mention some matter does not mean that he did not consider it. However, consideration of his remarks in their entirety leads to the conclusion that he regarded the seriousness of the offending and the need for general deterrence as the important matters in the exercise of the sentencing discretion and had little or no regard to the circumstances of the appellant which, in my view, indicated a merciful approach to sentencing. 10. The Courts, on many occasions, have considered the proper approach to sentencing in cases of this nature. General deterrence is an important consideration: Taormina v The Queen (1980) 24 SASR 59, The Queen v Vasin; The Queen v Scherf (1985) 39 SASR 45, R v Schneider (1988) 37 A Crim R 395. Recently the Full Court has again had occasion to re-affirm that principle: R v Cameron and Simounds (19th July 1993 - as yet unreported). In these cases, after acknowledging that abuse of the social security system jeopardises the system itself and causes injustice to the genuine beneficiaries of the system, of those King CJ, with whom Duggan and Debelle JJ agreed, again referred to the need for general deterrence and went on to say:-
    "... the courts have a great responsibility to protect
    the integrity of the social security system by imposing
    punishments for deliberate and sustained fraud which are
    likely to operate as a deterrent to others who may be
    tempted. It's necessary to acknowledge and to appreciate
    that recipients of social security benefits are almost
    (sic). Without exception subject to great financial
    pressures. They are obliged to maintain themselves and to
    provide for their needs on an income which is by no means
    handsome, therefore, there must always be a temptation to
    enhance that income, and if it appears that that can be done
    without running the risk of severe punishment, it is likely
    that others will be tempted to follow the example of
    fraudulent persons. It is necessary for the courts to send,
    and consistently send, a clear signal to all who might be so
    tempted that sustained and deliberate fraud upon the system
    will mean going to gaol." 11. After referring to positive features of the circumstances of the offenders, he continued:-
    "Nevertheless, in cases of this kind of sustained and
    deliberate fraud over a period of time the deterrent
    purpose of punishment must be paramount. The necessity
    of protecting the integrity of the social security
    system by deterrent penalties must take priority over
other considerations." 12. The fraud of the appellant was that she did not inform the Department of her marriage. She had properly been receiving the Sole Parent Pension but obviously succumbed to the temptation to continue to receive it despite her marriage. It is reasonable to accept that she did so because of the financial pressures which had been placed upon her by members of her family and her sense of obligation to them as well as the substantial debts she had incurred associated with the death of her mother. Her offending is not characterized by the degree of deliberation, cunning and flagrant criminality present in many cases which substantial sentences of imprisonment actually to be served have been imposed. There was no use of a fictitious name or the receiving of two pensions at once due to personal greed which are features of many cases. I do not mean to understate the seriousness of her offending. The receiving of the benefits over such a long period and not giving correct information to the Department when periodically filling out forms are matters of aggravation, but reason for her offending, the sense of obligation to help others and to repay debts, permits the characterisation of her offending as less serious than in many cases. 13. In my view, the sentencing discretion of the learned Special Magistrate miscarried in that, in the circumstances, he gave too much emphasis upon the deterrent aspect of punishment and too little emphasis upon the matters favourable to the appellant to which he was obliged to have regard by virtue of s.16A. Given the previous good character of the appellant, the circumstances of her offending and the other positive matters about her, a sentence of imprisonment for fourteen months appropriately and adequately recognizes the need for general deterrence. 14. I do not think the Full Court in Cameron and Simounds v R (supra), in saying that the deterrent purpose of punishment must be paramount, was laying down a principle of sentencing that in all cases of fraud against the welfare system mitigating features of the circumstances of the offence and the offender can never assume prominence. The Court was speaking of the type of serious fraudulent conduct which it there had to consider. In the more serious types of cases, the need to deter others who are minded to deliberately and systematically defraud the system must prevail over matters of mitigation. However, in less serious cases the need for deterrence will not be paramount. After all "mercy to an individual offender is not inconsistent with recognition of the seriousness of offending": Scott v Cameron (1980) 26 SASR 321 per White J at p 324. As the learned Special Magistrate, in my view, erred in the exercise of the sentencing discretion, it must be exercised afresh on this appeal. I think the sentence of imprisonment is appropriate. However, the circumstances did justify extending to the appellant the opportunity of not having to serve any part of the sentence. An order for her immediate release upon her entering into a bond pursuant to s.20(1)(b) is in the nature of a suspended sentence. Such a sentence is a very significant punishment: Wood v Samuels (1974) 8 SASR 465 at p 468 per Walters J and Elliott v Harris (No.2) (1976) 13 SASR 516 at p 527 per Bray CJ. In my view, a sentence of imprisonment for fourteen months with an order for immediate release upon the appellant entering into a recognizance in an appropriate amount with suitable conditions is a sentence which, in the circumstances, complies with the requirements of s.16A(1). I allow the appeal and quash the order for release after serving five months' imprisonment and in lieu thereof I order that the appellant be released forthwith upon her entering into a recognizance in the amount of $200 to be of good behaviour for a period of two years and during that time to be under the supervision of a probation officer. I think such supervision could be of considerable benefit to the appellant. As the recognizance is to be in different terms from those ordered by the learned Special Magistrate, I shall hear the parties as to the terms of the order which should be made.