Hili v The Queen; Jones v The Queen
[2010] HCATrans 248
[2010] HCATrans 248
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S142 of 2010
B e t w e e n -
ANTHONY JOSEPH LUIS HILI
Applicant
and
THE QUEEN
Respondent
Office of the Registry
Sydney No S143 of 2010
B e t w e e n -
GLYN MORGAN JONES
Applicant
and
THE QUEEN
Respondent
FRENCH CJ
GUMMOW J
HAYNE J
HEYDON J
CRENNAN J
KIEFEL J
BELL J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON WEDNESDAY, 22 SEPTEMBER 2010, AT 10.16 AM
Copyright in the High Court of Australia
__________________
MR J.T. SVEHLA: May it please the Court, I appear with MR R.J. WEBB for the applicants in both matters. (instructed by Snelgroves)
MR P.W. NEIL, SC: May it please the Court, I appear for the respondent in each matter. (instructed by Commonwealth Director of Public Prosecutions)
FRENCH CJ: Yes, Mr Svehla.
MR SVEHLA: Your Honours, these special leave applications have been referred to the Full Court as on appeal. Your Honour, I will proceed to argue the matters on that basis. There have been effectively two sets of written submissions been provided to the Court. The first and significant issue which was raised by the applicant in each matter is the issue of whether or not when a judge who is sentencing a federal offender for a federal offence determines that a mandatory period of imprisonment is required whether there is or should be a norm as to the period of mandatory imprisonment.
In this particular case, your Honours, the mandatory term of imprisonment was dealt with under a recognisance release order rather than a non‑parole period. I will take your Honours to the relevant provisions in Part IB of the Crimes Act shortly, if I could. The issue arises in a context where the New South Wales Court of Criminal Appeal allowed the appeals brought by the respondent on the basis that the sentences imposed by her Honour Morgan DCJ in the District Court of New South Wales were manifestly inadequate.
Mr Jones and Mr Hili were sentenced together and their matters at all times proceeded together. At first instance her Honour imposed a head sentence of 18 months with a pre‑release period of seven months with a recognisance release order then to come into effect so that they would leave prison for the balance of the period of 18 months. The Court of Criminal Appeal in New South Wales held that those sentences were manifestly inadequate, both as to the head sentence. It considered that the head sentence should be three years rather than 18 months and that the mandatory period of imprisonment which each should serve should not be seven months, but should be 18 months. So, effectively, in terms of the head sentence, the Court of Criminal Appeal in New South Wales doubled it by 100 per cent, from 18 months to three years, and in terms of the mandatory period of imprisonment that each of the applicants or offenders had to spend in prison, the increase was a bit over 150 per cent, from seven months to 18 months.
FRENCH CJ: Once the head sentence was increased, that enlivened afresh the discretion in relation to the mandatory period, did it not?
MR SVEHLA: Yes, your Honour. Well, it enlivened an increase in the quantum, yes. Whether it not it would enliven the entire discretion – in this particular case, the way the matter was argued, yes. The way the matter was argued and the way in which the appeal was brought forward by the respondent was essentially that both the quantum of the head sentence and the mandatory period of imprisonment were manifestly inadequate and it seems to have been on the basis that they were just so far outside the available ranges for this type of offence, there was no issue in relation to any of the subjective features of either of the applicants or of the decision of her Honour Morgan DCJ that in relation ‑ ‑ ‑
HEYDON J: Judge Morgan.
MR SVEHLA: Sorry, Judge Morgan – that there should be a discount of 50 per cent for the early plea of guilty past and future assistance in relation to the head sentence. So there was much that was not an issue in the way the appeal was brought forward.
CRENNAN J: In relation to the latter point, was the argument that the release on recognisance was too short because 60 per cent of 18 months is 11 months, not seven months? Is that the terms in which it was put?
MR SVEHLA: No. There were two aspects in the way in which the respondent argued the appeal. The first is that the head sentence was far too low.
CRENNAN J: Yes. I was talking about the other aspect of the argument.
MR SVEHLA: In respect of the other, yes. Their fallback position was that it should have been at least – the Crown argued both aspects, but if they did not succeed on increasing the head sentence, they had as a secondary argument that the mandatory period of imprisonment should be in the 60 to 66 per cent range, so it should have been around 11 months rather than seven months. So your Honour is correct in that sense.
If I can take your Honours immediately to the judgment of the Court of Criminal Appeal because the submission is that essentially the New South Wales Court of Criminal Appeal has set out a standard or a norm or a guideline for the determination of the mandatory period of imprisonment which should be imposed in relation to a federal sentence when a judge determines that a mandatory period of imprisonment is required. If I could take your Honours to volume 3 at appeal book 921. It starts at about line 20 at paragraph 31 of the reasons of Justice Rothman. Justice Rothman delivered the reasons in which Chief Justice McClellan of the Common Law Division and Justice Howie concurred.
HAYNE J: Is this an approach which you seek to support or to discount?
MR SVEHLA: We do not support it, your Honour. What we say is that insofar as one may look at what has happened historically in relation to particular types of sentences for particular types of offences and engage in an empirical observation or descriptive observation, that is within the proper exercise of power. To go beyond that and to determine a norm or standard or guideline which becomes a starting point within which the usual period of mandatory imprisonment has to fall and then to ascertain whether or not there are any special features of the particular offender that would take you outside that, is impermissible. That is going beyond a descriptive approach to a prescriptive approach and that is a significant error. The way in which Justice Rothman has developed it in the reasons it not only – it is said to apply across the board to the determination of the mandatory period of imprisonment for all federal sentences.
GUMMOW J: Where do we find any reference in these reasons to Division 2 of Part IB of the Crimes Act?
MR SVEHLA: You do not, your Honour. There is just scant reference to a couple of the sections in disparate parts, your Honour. You do not find the analysis of Part IB of the Crimes Act (Cth) that one would expect to find, which I will take your Honours through, and to analyse how one has to apply the ‑ ‑ ‑
GUMMOW J: Would the submissions made to the Court of Criminal Appeal relying upon Division 2 of Part IB or is it just all sub silentio?
MR SVEHLA: The submissions both before ‑ ‑ ‑
GUMMOW J: I realise you were not counsel, I think, were you?
MR SVEHLA: No, your Honour. From reading them, the submissions of the Crown before Justice Morgan, and I believe because it formed at least part of the appeal books before the Court of Criminal Appeal, contained a summary of some of the sections of Part IB of the Crimes Act and indicated that that was the way in which had to be dealt with. There does not seem to have been a detailed consideration of that in the argument. The issue of the norm issue seems to have come at the heel of the hunt.
The original submissions by the Crown to the Court of Criminal Appeal relied upon a decision of CAK of the Court of Criminal Appeal in Queensland that indicated that there was a norm without referring to any subsequent decisions of the Court of Criminal Appeal which effectively overturned that decision, including the cases of Ruha, Fidler, Marshall and others. Supplementary submissions were then filed by the applicants as the respondent to that appeal on that issue which in some detail went through the various cases, but it was not a matter that seems to have been addressed in significant and detailed argument.
The respondents to these applications, your Honour, seeks to assert that the statements by Justice Rothman in his reasons for judgment do not go as high as has been asserted by the applicants and are effectively of a descriptive rather than a prescriptive nature. We do not accept that that is so, your Honour. The relevant paragraphs are 31 to 40 of his Honour’s reasons at 921 to 927. At 31 at 921 about line 20 his Honour raises the issue as to the appropriate ratio between a non‑parole period and a head sentence. It seems, your Honour, that generally the reference in the reasons to non‑parole period is meant to pick up a recognisance release order. In the second sentence in paragraph 31 his Honour says:
The Crown has submitted that the non‑parole period should be between 60% and 66% of the total sentence.
FRENCH CJ: I think in the context of Commonwealth offences we are speaking of a pre‑release period, are we not, as defined in section 16?
MR SVEHLA: Exactly, yes. Your Honour, a recognisance release order – if the head sentence is three years or less under 19AC the Court must impose a recognisance release order unless exceptional circumstances apply. Then, once there is a recognisance release order the period available, when one goes through the statutory provisions, is from zero days to the entire period of the head sentence. That is your range, zero to 100 per cent of the head sentence, nothing more and nothing less. The period that you are actually required to serve in prison within that range as part of a recognisance release order is called the pre‑release period, being a definition in 16(1).
FRENCH CJ: I think there may be an error, unless I am misreading it, in paragraph 21 of your submissions on page 6, paragraph (d):
the court could [not] fix a non‑parole period –
Is that not right? You make a recognisance release order and under 19AC(1), “must not fix a non‑parole period”.
MR SVEHLA: Yes, you cannot fix a non‑parole period where it is three years or under. Yes, I am sorry. In 31 it indicates that that principle is denied. In 32 Justice Rothman at 921 talks about the statutory regime for State offences under the State legislation which is that there is a non‑parole period of not less than 75 per cent, unless there are special circumstances. One should have regard to the fact that that is where his Honour first introduces the word “special circumstances”. That comes out of the State legislation. It has nothing whatever to do with Part1B of the Crimes Act (Cth). His Honour then says that there is:
No such statutory ratio or formula exists in relation to Commonwealth offences.
In 33 his Honour says, “This Court dealt with the issue” and the issue is the issue referred to in the first sentence of paragraph 31, namely the “appropriate ratio between a non‑parole period and the head sentence”. His Honour refers to the case in the Court of Criminal Appeal of Bernier and says, “and has consistently applied that guideline”.
FRENCH CJ: Your position is that simply looked at past sentencing patterns.
MR SVEHLA: Yes, exactly. It is a statement of empirical observation for the purposes of trying to ascertain the appropriate sentence that should have been imposed upon a person from Canada, who was a courier, where the amount of the commercial importation was 0.4 grams over the statutory minimum to make it a commercial importation.
FRENCH CJ: You accept that past sentencing patterns are a material consideration?
MR SVEHLA: Yes. As empirical facts to have a look at, but one does not therefore ‑ ‑ ‑
HAYNE J: That is a proposition that may require quite a deal of refinement, may it not? Past sentencing patterns may be relevant, if they are of the imposition of sentences in relevantly comparable crimes and circumstances.
MR SVEHLA: I accept that entirely, your Honour. I was trying to deal with it at the first level of generality, but yes. In Bernier, their Honours pick up the statement in Lawson by Justice Hunt that effectively is to that effect. That statement was picked up again by Chief Justice Gleeson in Wong where this Court was having to deal with the issue of the guideline judgment by the Court of Criminal Appeal in relation to certain drug offences and found that imposing a guideline was impermissible and also trying to impose it on the basis of the weight or the amount of the narcotic was also an impermissible basis upon which it should undertake that.
HAYNE J: But the point of my intervention is that a possible difficulty that lies beneath what appears in paragraphs 31 and following is the difficulty that is obscured by the generality of the propositions ‑ ‑ ‑
MR SVEHLA: I accept, yes.
HAYNE J: ‑ ‑ ‑ that all federal offences seem to be being dealt with as a group, whereas federal offences cover a very considerable range of criminal behaviours.
MR SVEHLA: Yes. To take the actual offences in this case, your Honour, the former 29D fraud on the Commonwealth, its replacement, 134.2(1) of the Criminal Code, obtaining a financial advantage by deception and the money‑laundering offence, are offences which are capable of being charged in many, many circumstances. The fraud offences relate to postal fraud, excise, social security fraud, income tax, company fraud, a whole range of ‑ ‑ ‑
GUMMOW J: Section 29D used to be section 86, was it not?
MR SVEHLA: Yes.
GUMMOW J: It has been around for a long time. It covers a whole miscellany of ‑ ‑ ‑
MR SVEHLA: Yes, and you then are going to get a whole range of factual circumstances, a whole range of quantum, and a whole range of other matters. Even within that, one cannot have a simple guideline in relation to that type of offence. One might, for example, be able to develop, as the Court of Criminal Appeal did in Bernier, where you have a statutory minimum to describe a commercial quantity of a prescribed drug that has a starting point, and look at empirical data to try and ascertain historically what has been the sentencing pattern for that type of case, because you also may objectively get a lot of similar features involved in that.
The general statement, even on an empirical basis, masks a whole range of problems, your Honour. You are going to get some cases where there is no or no sufficient empirical data. That, in itself, was a matter which their Honours had to deal with in Bernier. They forthrightly addressed the fact that there is not enough empirical data for us to set a firm statement. All they were able to do, looking at what they had, was the empirical evidence we have is that historically this seems to be what has been the usual sort of case. Their Honours did not say you need special circumstances to go outside it. They were just trying to provide assistance to other judges dealing with that type of offence, not trying to say you do not actually apply Part IB and apply the actual discretion that you are required to undertake under Part IB. It is just a judicial assistance for that purpose. They were not saying you have to be within 60 to 66 per cent.
Now, at 33 of his judgment, his Honour is saying that Bernier is a guideline across the board to all sentences (a) that insofar as that is a statement of the New South Wales position it is legal error and cannot be followed, your Honour. They then refer to – his Honour refers to the statement of Justice Meagher in Viana which, when one reads it, at about line 53 says is that:
The most that can be said is that this Court has usually in cases of this sort, thought the proportion ought to be somewhere between 60 and 66 percent.
That statement of itself is relatively harmless, just being a statement of empirical observation for that sort of offence. Then in 34, his Honour elevates it and says:
Statements of this kind, and to this effect, are of long-standing.
His Honour is utilising it in the context of the applicants who had been charged with financial offences arising out of effectively fraud on the Commissioner of Taxation. Then, his Honour says:
while the Court contemplated higher percentages than 66%, there was no contemplation of lower percentages than 60%.
That statement is not being made there in the context of a commercial drug importation case but of general application. Then, his Honour introduced the circumstances notion, back again:
Of course, circumstances that are special to a particular individual may give rise to considerations that would allow a court, when sentencing, to provide, as part of an overall sentence, a longer than usual potential parole period (or period of supervision under a recognizance release order).
There are several things. Firstly, the words in brackets are where one has to try and deconstruct the reasons to ascertain that parole period or non‑parole period – sorry, the parole period means the recognisance release order, non‑parole period means the pre‑release period generally in the reasons. That is the only insight one gets to that. Now, the notion here is his Honour is saying that if a particular offender has circumstances that are special to him, you may be able to give a larger than 60 per cent – you may be able to have a mandatory period of imprisonment of less than 60 per cent. He then says:
This would ordinarily be for the purposes of facilitating rehabilitation. But special circumstances may arise from a number of factors.
So his Honour is setting up a prescriptive, we would say, norm or standard with which the sentencing judge is to operate within in determining a mandatory period of imprisonment of a federal sentence whether it be the pre‑release period or the non‑parole period.
His Honour is saying you get a narrow band of six per cent as your starting point for a federal offender, and what sort of federal offender gets that? Someone who does not have “special circumstances”, whatever that means. What is the usual offender that gives you a six per cent band? It is unexplained. What are the special circumstances? They are also unexplained. The judge exercising the federal judicial power is not permitted to start the process from this. His Honour then goes on in paragraph 35 to indicate that before their Honours the applicants as the respondents raised the certain decisions in Queensland that question that proportion. His Honour then says:
there is little or no divergence in principle, and the authorities, upon which the Respondents rely, provide no basis for reconsidering the above approach.
When your Honour considers those authorities which are referred to in our submissions, in particular, in the first set of submissions before the special leave application itself, the decision of CAK was expressly – well, first of all it failed to take into account an earlier decision of the Court of Appeal in Queensland of Robertson, that was not referred to. It was then expressly overruled in Ruha, and it has been expressly overruled ‑ ‑ ‑
GUMMOW J: What is the citation of that case?
MR SVEHLA: Pardon me, your Honours.
HEYDON J: It is [2010] QCA 10.
MR SVEHLA: Can I take your Honours to page 948 in volume 3. At line 20, the statement is made that the New South Wales position was held by the Court of Criminal Appeal not to be the law and it has overruled its earlier decision of CAK and then one goes to footnote 32. If your Honours goes to footnote 32, it gives the reference for CAK and then in (b)(i), indicates it:
(i)is contrary to the earlier decision of the Queensland Court of Appeal in R v Robertson [2008] QCA 164 –
that is in (b)(i) at page 948 at about line 50. CAK –
(ii)did not refer to R v Robertson;
(iii)has not been followed in subsequent Queensland Court of Appeal cases –
which are all set out there: the Ruha decision in [2010] QCA 10 in the decision of Justices Keane and Fraser in the Court of Appeal – Justice Keane as he then was –and Justice Atkinson; Chandler [2010] QCA 21 which applied Ruha and where Justice Keane was also one of the presiding judges, and agreed to by the Chief Justice: Fidler [2010] QCA 25; and Marshall [2010] QCA 29. So there has been a series of cases that have expressly overruled the proposition in CAK.
These were referred to in the supplementary submissions that were provided by the applicants as respondents for the New South Wales Court of Appeal and the proposition of Justice Rothman in response to that is that there is little or no divergence of principle in authorities and they provide no basis for reconsidering the above approach, at paragraph 35 on 922. The above approach is that set out at 33 and 34 of his Honour’s reasons which elevates Bernier into something that it is not.
HAYNE J: Be that as it may, in paragraph 35 his Honour refers to there being little or no divergence in principle. Does his Honour at any point in the reasons identify what principle is being applied in fixing, be it a non‑parole period or a recognisance release order?
MR SVEHLA: The highest it goes to, your Honour, if you go to page 927 starting at line 10 paragraph 40 which is where his Honour takes it at the higher, more general level. If one goes to page 927, line 10, paragraph 40 of his Honour’s reasons, his Honour says:
whatever “norm” is utilised –
Now, the significance of that, your Honour, is it means you do utilise a norm otherwise there is no meaning for those words –
the task of the sentencing court is to fix and impose a sentence that appropriately fulfils the goals of punishment, deterrence (general and specific), retribution and reform. It is difficult to imagine, in circumstances where, pursuant to s 17A of the Act –
and that is the Crimes Act (Cth) –
a sentencing judge has come to the conclusion that a sentence of imprisonment is appropriate (and therefore that no other sentence is appropriate), that a mandatory term of imprisonment of less than 60% would be warranted, other than in special circumstances. For any serious offence, any lesser mandatory period of imprisonment would not seem properly to reflect the criminality of the conduct, except in special circumstances.
That is as high as it gets, your Honour.
HAYNE J: Well, is that adopting principles of the kind considered by this Court in Power v The Queen 131 CLR 623, Bugmy v The Queen 169 CLR 525 at 531 and, forgive my parochialism, but reflected in Victorian decisions in Morgan and Morgan 7 A Crim R 146, Iddon &Crocker 32 A Crim R 315, which are picked up in Bugmy.
MR SVEHLA: No.
HAYNE J: The Court has considered what principles are to be engaged in fixing the period that must be served in prison.
MR SVEHLA: Yes.
HAYNE J: Now, are those principles principles that are relevant to the statutory framework of Part IB?
MR SVEHLA: Yes. Part IB and, in particular, 16A(1) and 16A(2) require you to take all of those matters into account when determining the appropriate period of mandatory imprisonment. There is no selection of one or two or three because 19AC says that where the head sentence is three years or less, the mandatory period of imprisonment could be from zero to the entire period, that is the judicial discretion, and where 16A(1) and 16A(2) point the judge in exercising that judicial discretion to have regard to all of those matters and to give the appropriate weight to them in the circumstances of that particular offender. Once you apply that, you cannot have as a starting point 60 to 66 per cent for the usual offender. That is an impermissible exercise of judicial power of the Commonwealth.
HEYDON J: Can I raise a difficulty I have?
MR SVEHLA: Yes.
HEYDON J: Your problems start with the fact that Judge Rothman thought that the sentences given by Judge Morgan were so far outside the range of available sentences there must have been error so he set aside those sentences and began to resentence and in the course of resentencing he did not commit himself to any norm about 60 to 66 per cent. He said he accepted Judge Morgan’s view that there were “special circumstances” warranting “a period as low as 50 per cent”. Do we not have to sort of first of all work out whether he was right to say that it was outside, as it were, the range and, secondly, whether you are right to say that no adequate reasons were given for that course? Only when we have got through that undergrowth do we bother with 60 to 66 per cent but do we bother with it at all, apart from an interesting fallacy, perhaps?
MR SVEHLA: Your Honour, the language in paragraph 44 that your Honour has quoted at page 298 at about line 30 ‑ ‑ ‑
HEYDON J: Yes. How should we amend that in the light of the second judgment?
MR SVEHLA: Yes, I will come to that. When one deconstructs these reasons, this is where his Honour is dealing with the second aspect of the appeal which is the period of mandatory imprisonment, not the head sentence, and his Honour says:
I would not interfere with her Honour’s proportion in terms of mandatory imprisonment period as I accept that there are grounds upon which her Honour could find that there are special circumstances that warrant –
Those are very key words. That means his Honour is applying the norm and the reasoning of the norm.
CRENNAN J: Because he has picked the rubric up from the New South Wales statutory provisions.
MR SVEHLA: Exactly, yes. He has picked it up and he has effectively embedded that and justified it according to Bernier and his Honour is saying, “I consider that these applicants have special circumstances”. He is not applying Part IB at all. He has not referred to 16A(1) in any proper or meaningful or 16A(2) in any proper or meaningful way.
HEYDON J: You are assuming that you have lost the most important part of the appeal. For you, if you can demonstrate the Judge Morgan sentence was within the range or that we do not know whether it was or not because the reasons given are so inadequate, you have gone a long way, but if you lose on those points then we get into paragraph 44. Now, you seem to be lacking in complete self‑confidence, or your clients do.
MR SVEHLA: I am not, your Honour. Unless this is addressed – first of all we say this Court should deal with the matter on a final basis, and I will come to that, but if this matter went back we would be faced with the norm, unless it is addressed, so it has to be addressed, but in terms of the ‑ ‑ ‑
HEYDON J: Speaking for myself, I find it difficult to work up much interest in the norm until I am convinced that it is a crucial aspect of the controversy between you and the Queen.
MR SVEHLA: It is a crucial aspect of the controversy because it was applied in paragraph 44 in determining that applying the norm you could not go ‑ ‑ ‑
HEYDON J: We do not get to 44 unless you show something wrong with 41, 42 and 43.
MR SVEHLA: I accept that, but your Honours have to realise that there is ‑ ‑ ‑
HEYDON J: You do not have special leave. The trapdoor could open at any moment.
MR SVEHLA: I understand, your Honours. It might be a good thing.
CRENNAN J: May I just raise one matter with you? In paragraph 38 of his Honour’s reasons he does make reference to paragraph [45] in Ruha which, I think it is fair to say, is a very important paragraph.
MR SVEHLA: It is, your Honour.
CRENNAN J: That refers of course to 16A(1) and (2) and, I think, particularly the last sentence is very important because the point being made is that the sentences for serious tax fraud are – I am sorry, let me just start again:
it is relevant to note in these appeals that the necessary deterrent and punitive effect of sentences for serious tax fraud must be reflected both in the head sentence and also in any provision for earlier release from custody.
That is after making reference to 16A(1) which, of course, refers to a sentence of severity appropriate in all the circumstances and it may be that is what his Honour was grasping at in paragraph 35 when he said:
In my view, there is little or no divergence in principle –
That is emphasising that the 16A(1) requirement has an impact not only in relation to the head sentence, but also in relation to earlier release from custody.
MR SVEHLA: That may be so, your Honour. Unfortunately, his Honour has not enlightened us by saying that, but the way his Honour has dealt with it is an entirely different language without referring to that and that is the problem. His Honour picked up and utilised the approach of Ruha and the decision of Justices Keane and Fraser by reference to 16A(1) and 16A(2). You would not have had the language of the norm that appears in the judgment.
KIEFEL J: Do you say in paragraph 39, where his Honour again seems to be talking about the lack of divergence in principles that was earlier adverted to in 35, that there is indicated some misunderstanding of what was said in Ruha?
MR SVEHLA: Yes, your Honour. Paragraph 39 is a difficult paragraph to understand because when you read the paragraphs [45] to [51] of Ruha that are extracted in 38, you would not form the view that the statements of his Honour in 34, 35, 39 and 40 could have been made, that a very different approach would have been undertaken and Ruha does not say that there should be or is a norm of between 60 and 66 per cent which will be affected by special circumstances. The only reference that one can find in Ruha is at [52] where the way the justices in Ruha has dealt with the New South Wales proposition is to pick up the statement in Bick in the New South Wales Court of Criminal Appeal which just repeated the observation in Viana which his Honour repeated earlier at paragraph 33.
KIEFEL J: I think that is further explained in the complete judgment in Ruha [2010] QCA 10 at paragraph [53] where their Honours go on to say that:
That passage [from Viana] makes it clear that the suggested range is a description of the usual result of decisions.
MR SVEHLA: Exactly. But the problem is that (a) that is not part of this extract, it deliberately does not refer to that, we would say. That is the first thing.
KIEFEL J: That paragraph [53] in Ruha would appear to be quite important to that decision.
MR SVEHLA: Yes, so he has left that. Secondly, you cannot make sense of that with paragraph 40 of his Honour’s reasons to say that is how you approach 17A. Thirdly, the statements in 39 just are not consistent with that sort of descriptive approach. In terms of the matters that his Honour Justice Heydon asked me about ‑ ‑ ‑
GUMMOW J: Part of the problem with Justice Rothman’s decision is that you do not find in it the sort of statement as to the basic structure you find in paragraph 32 of the Queensland decision, namely, you start off with Part IB. You do not sort of apply the so‑called general principles that seem to float somewhere in the sky and at some stage tether them to 16(1)(b).
MR SVEHLA: Your Honour, with respect to Justice Rothman, if one properly understands the operation of Part IB you could never say that pursuant to 17A the statements he said in paragraph 40.
GUMMOW J: You want us to restore the primary judge’s decision, do you not?
MR SVEHLA: Yes. I know that is rare. It was done in Dinsdale. Your Honours also there referred to – in the Dinsdale decision of this Court at 25 and 26 ‑ ‑ ‑
GUMMOW J: But to do that ‑ ‑ ‑
MR SVEHLA: I have to show that it was ‑ ‑ ‑
GUMMOW J: Exactly. You have to deal with the matters Justice Heydon put to you.
MR SVEHLA: Yes. The first issue, your Honour, is that when one goes to the reasons of Justice Rothman on stating that there was manifest error the only statement one gets – if one goes to page 927 at paragraph 41 at about line 40 his Honour says that:
But manifest error is fundamentally intuitive. It arises because the sentence imposed is out of the range of sentences that could have been imposed and therefore there must have been error, even though it is impossible to identify it.
42In my view, the sentence imposed in these matters is so far outside the range of sentences available that there must have been error.
There he is talking about the head sentence. Then his Honour states at paragraph 43 on page 928:
I would allow the appeal. I would fix a sentence at the low end of the available range to take account of the obvious desire of the sentencing judge to fix a low sentence and in order to take account of the subjective features on which her Honour so heavily relied. I agree with the submission –
and this is that of the respondent, the Crown –
that the appropriate sentences, without reductions for plea and assistance, are six years. Because of the attitude of the Crown, I will apply a reduction in the sentence of 50% to account for the plea of guilty and assistance. I continue the allowance of 12.5% for future assistance under s 21E of the Act.
There is no discussion or indication of what it is that is the range which itself is a very – it is one of those words that sentencing judges often use but it masks a whole host of issues.
What are the appropriate cases one takes into account in relation to a financial fraud? For these offenders, do you only look at income tax cases? Do you go for excise cases, social security fraud, postal fraud?
BELL J: Sometimes the expression might be used in cases where there really is not an apposite range but by reference to other principles of sentencing which include that one has some regard to the maximum penalty and to the objective seriousness of the offence. So here one might take into account the sophisticated nature of the scheme and the period over which the offence took place, considerations of that sort.
MR SVEHLA: I accept what your Honour is saying but one should state that. In other words, that is a different type of exercise of the appellate discretion, in other words, saying that the judge below, the sentencing judge gave insufficient weight to these particular objective features and that they should have been taken into account under 16A(2)(g) or whatever.
BELL J: It might be that in a summary way his Honour was saying that by his reference to the intuitive nature of the identification of manifest inadequacy ultimately it is a judgment, is it not?
MR SVEHLA: Yes, but where the appellate court is undertaken there it has to be very careful not to just replace its own decision and that is why it should be exercised with great care and that one does not easily overturn the discretionary decision of the sentencing judge. The real problem that we have with that, your Honour, is that there is no indication of what it is that his Honour did. What regard did his Honour have to the objective and subjective features in this case? There is just no statement of it. Secondly, your Honour, when one looks at the actual ‑ ‑ ‑
HEYDON J: He did not say that in paragraph 41 but he accepted the trial judge in 43. He was not disagreeing with the trial judge about the subjective factors.
MR SVEHLA: No, there was no issue on the appeal by the Crown on any subjective features. The entire appeal was run on the simple basis that given these offences the sentences were just too low, full stop. In fact, in the submissions that were put forward by the Crown, if I can take your Honours to volume 3 at 761, starting at about line 40 under the heading “Basis of appeal”, if your Honours have that, these are the written submissions of the Crown. In paragraph 31:
There is no challenge to the learned sentencing judge’s findings with respect to:
·The value of the assistance given and to be given by each Respondent to the authorities.
·The genuine remorse and contritition of each Respondent.
·The good prospects for rehabilitation of each Respondent.
·The strong subjective features in the case of each Respondent.
Then at 32 over the page:
The fundamental submission put by the Appellant is twofold:
(a)In respect of each Respondent the commencement point taken by the learned sentencing judge was too low to reflect the Respondent’s criminality . . .
(b)The period of the recognisance release orders made by the sentencing judge are disproportionately low -
That was the basis upon which the matter was put forward. Then in paragraph 33, the discount Judge Morgan gave a 50 per cent to reflect early pleas and assistance to authorities, there is no challenge to that. Then at the end of that paragraph they say that the pre‑release period should have been within a 60 to 66 per cent range and hence the 40 per cent is unexplained and should not be allowed.
KIEFEL J: I think the reference to the potential error in the commencement point for sentencing is taken up at paragraph 39 of the respondent’s written submissions and I do not think that that was dealt with in your reply.
MR SVEHLA: Yes. Your Honour, Judge Morgan does not give a commencement point. She undertakes the instinctive synthesis approach in accordance with Wong. Do your Honours have the annexures to our written submissions at tab C or annexure C?
FRENCH CJ: Yes, we have them.
MR SVEHLA: Your Honours, this is for the applicant Hili and D is for the applicant Jones. What it does is goes through the reasons for sentencing of Judge Morgan and identifies all of the things her Honour took into account. It is annexure C.
BELL J: What is the title of annexure C? I have a different annexure C.
MR SVEHLA: It says:
THIS IS THE ANNEXURE MARKED “C” REFERRED TO IN THE APPELLANTS’ SUBMISSIONS DATED 9 SEPTEMBER 2010
Annexure “C” :
Anthony Joseph Luis Hili
Morgan DCJ Application of Part 1B of the Crimes Act in Sentencing.
This is in the applicant’s not the ‑ ‑ ‑
BELL J: I see.
KIEFEL J: It is about four pages from the back.
BELL J: Yes.
MR SVEHLA: Yes. Now, what I have sought to do there, your Honour, is to indicate what her Honour actually did in her reasons for sentence. C is for Mr Hili, D is for Mr Jones. The sentences are identified. She has the summary of the agreed facts. She states that the sentencing has to be undertaken with regard to Part IB. There is recognition of the guiding principle in 16A(1). There are expressed statements in several passages that deterrence is a most important consideration. It is expressly stated. She then indicates that you have got to undertake the matters in 16A(2). She deals with 17A. She deals with the 21E discount for future co‑operation. She gives the sentences. She explains them under 16F and then there is the explanation in 21E. Then on the second page each of the elements in 16A(2) is gone through and, where relevant, all of the evidentiary references are dealt with.
BELL J: Can I take up this with you, and I think it might have been a matter that Justice Kiefel was raising with you. Her Honour gave an allowance for the plea of guilty and the assistance to the authorities of 50 per cent and that applied to the head sentence and then it would seem, additionally, the pre‑release period reflected that consideration together with other matters because she had indicated absent the assistance a three‑year sentence with a 21‑month pre‑release period.
MR SVEHLA: Yes.
BELL J: As I understand it, the respondent takes issue with that approach. What do you say is the correct approach with respect to the consideration of the assistance to the authorities in forming both the head sentence and the pre‑release period in circumstances where release is automatic at the expiration of the pre‑release period?
MR SVEHLA: The Part IB and, in particular, 16A(1) and 16A(2) and all of the elements in it, are to be applied both in determining the head sentence and separately in determining the pre‑release period.
BELL J: I think it has been said in cases like Bugmy that the same considerations inform both aspects of the single sentence that the court imposes but that they will play differing roles. In part, that recognises that rehabilitation is a significant factor involved in the early release of a prisoner.
MR SVEHLA: Yes.
BELL J: When you go back and you look at earlier discussions in this area at a time when the Commonwealth Prisoners Act applied the State and Territory parole regimes at a time before those regimes had a fixed proportion between the non‑parole period and the head sentence, some of the discussion in early cases involved a notion that the expiration of the non‑parole period did not necessarily correspond with the date the person got out of prison but that people within the correctional system would then consider their suitability and an assessment be made and factors such as protection of the community and rehabilitation could be taken into account at that stage.
Part IB is a scheme, certainly with respect to recognisance release orders and non‑parole periods, say for very lengthy sentences, which does not build that consideration into account. So it is just a question absent in Part IB any statement of the principles that the court is to take into account about how one would properly reflect the assistance to the authorities in the minimum term.
MR SVEHLA: Your Honour, all appellate courts can do is indicate considerations which a sentencing judge should take into account. You cannot exclude the subjective factors in 16A(2) and simply say that the principle of general deterrence, for example, has to override all circumstances. That is an improper analysis and exercise of the power in 16A(2) as it applies to determining the pre‑release period.
You are able to have statements such as where you are dealing with a taxation offence the principle of general deterrence is an important one. It is just mere one of the factors that guides what occurs. It does not mean, therefore, that in all cases where you get real assistance that general deterrence has to mean that you cannot, therefore, give a generous pre‑release period. It does not mean that at all. So, essentially, as long as the correct principles are applied, it is a matter for the sentencing judge.
Now, in this case, there are several things that I wish to say. Firstly, your Honour, in determining the head sentence Judge Morgan did not give her starting point. She did that conformable with Wong. What she said was that “But for the early plea of guilty, significant past assistance and the promised future assistance, I would have given a head sentence of three years”.
When you analyse what her Honour is saying, those are the three things that have taken the head sentence from three years to 18 months. “Implicit in that” means her Honour has already taken into account all of the other elements in 16A(2) - rehabilitation, circumstance, commission of offence, et cetera, reparation, all of those things.
One wants to have a starting point, which Wong says you do not have. It is obviously higher than three years. The notion that this “starting point” was three years is just wrong. What her Honour is saying is that “Taking into account all of the subjective features, but for these three things, applying 16A(2) and sentencing principles, I would have given a head sentence of three years. But I give that discount of 50 per cent off the head sentence for those three things from otherwise where it would have been”, which is three years.
There was no issue taken about that with the Crown. Their submissions accept that. Her Honour was not required to say “This is my starting point” because that is the very thing that Wong and Markarian say you do not do. It is clearly above three years. It may have been four and a half years or more. We do not know. Her Honour did not have a starting point, because you do not.
Then you come to the second thing which is the pre‑release period. In respect of the pre‑release period, her Honour gave a total discount for those three matters – said that she would have given 18 months otherwise as a pre‑-release period. Her Honour reduced that to seven months. Her Honour has given a more generous discount of those three objective facts in determining the pre‑release period in this case. It is more than 50 per cent. That is what her Honour is saying, as she is permitted to do under section 16A.
BELL J: When the Court of Criminal Appeal came to consider the challenge of manifest inadequacy which embraced the pre‑release period, how was it to approach her Honour’s statement that deterrence was important, and the fixing of the seven month reconnaissance release order against an 18‑month sentence.
MR SVEHLA: Their Honours had to find that ratio of that pre‑release period was so inadequate. We have given in annexure A about 14 or 15 cases in the area of – most of them are 29D‑type offences.
GUMMOW J: Where does this notion of manifest excess as supporting the appellate structure in federal offences come from?
MR SVEHLA: Just pardon me. There are statements, I believe, in ‑ ‑ ‑
GUMMOW J: You are talking about Commonwealth law. You have to find something in the statute, basically. Where do we find it in the statute or in some judicial gloss on a statute? If there is a judicial gloss, I would like to know where it comes from.
MR SVEHLA: Yes, your Honour.
GUMMOW J: If it comes from House v The King, which seems to have influenced the judge, House v The King revealed a state of affairs which led to specific legislative provision now found in Part IB added in 1990 and this notion of discretion which is associated with House v The King seems to have infiltrated the Court of Criminal Appeal’s reasoning in this case.
MR SVEHLA: Yes.
GUMMOW J: Then you add in this notion of norm which comes from somewhere else in the sky and you produce the result that the primary judge went wrong, but I am not sure she did go wrong. She started at page 715, line 40. She set out Part IB. She said what she had to do and away she went in some detail.
MR SVEHLA: In extreme detail, your Honour. What her Honour does is go through everything and having gone through everything, at the end she gives the sentence which is conformable with Wong and Markarian in this Court. It is exactly what you are meant to do. She does not say, “This was my starting point”, because that is wrong. She does not do that and she is not meant to do that. She does not refer to comparable cases, but a sentencing judge does not have to refer to sentencing cases in their judgement. An appellate court does if they are trying to say that there has been manifest inadequacy of error. There is a big distinction. She just does a very standard sentencing judge’s job, going in detail through all of the objective features, the facts, all of the subjective features, all of the relevant provisions and comes up with the sentence. The range for the pre‑release period is zero to the head sentence. That is what it is.
BELL J: But just as a matter of principle, how does a judge approach the question of how to fix the pre‑release period in a context where it is apparent that release will follow automatically so there is no question of the court setting a minimum term with any assessment being made thereafter about the person’s suitability? I think if one goes back to the Victorian case of Williscroft [1975] VR 292, which is quoted with approval, one gets a statement there of the suggestion of proportion between the non‑parole period, to use the language of that case, and the head sentence in respect of serious offences. I am raising with you the suggestion of some principled approach to how one fixes a head sentence and then the minimum term. What is your submission in that respect?
MR SVEHLA: Your Honour, the notion that there has to be a proportionality is not correct, as a matter of principle, because all the circumstances of a particular offender may make that the wrong approach and 19AC, 20(1)(b) and 19AF relating to a recognisance release order make that clear by saying the period is from release forthwith to the period of the head sentence. So you cannot import extra judicially into that a requirement of proportionality. What you can say is, give guidance that the sentencing judge has to consider for certain types of offences the issue of proportionality in circumstances where a mandatory period of imprisonment is appropriate. You cannot take that beyond that and say that because of that, all of the subjective features of the particular offender mean that, for example, proportionality means there has to be 50 per cent or 30 per cent or whatever. When you look at the actual decisions in cases, you get a very wide range. You will get immediate release. You will get suspended sentences, et cetera.
BELL J: That, no doubt, reflects the very different circumstances of cases?
MR SVEHLA: Yes, exactly. That is why you cannot have as a – that is what is the whole problem with the norm, your Honour, is that it is effectively introducing a proportionality.
BELL J: I understand that criticism. What I am taking up with you is in a case where the objective circumstances are seen to make this a serious instance of a fraud on the revenue category of offence and one finds a head sentence of the order of 18 months, what informs the consideration of the fixing of the pre‑release period? It is not necessarily clear from her Honour’s judgment.
MR SVEHLA: No. As a matter of principle, your Honour, the matters in 19A(2) have principle significance with general deterrents brought in 19A(1) or any other matter in 19 – sorry, 16A(1) and 16A(2). Beyond that you can only have statements of matters which a sentencing judge should take into account. You cannot have a particular proportion. You cannot say that for a particular type of tax offence that – for a certain amount of money, except in this very unusual case, that you have to have a particular period inside. You just cannot make it that specific.
In this case, what informed her Honour was those three things. Hili pleaded guilty, past and future assistance. Then in relation to the assistance, your Honours have to understand that applicant’s assistance is in relation to a fairly sophisticated tax fraud scheme being one of the projects being investigated under Project Wickenby. It is called Operation Starlifter, and in relation to that, if I can – and this has obviously informed her Honour’s reasons. If I can take your Honours to volume 1 and can I take your Honours to pages 154 and 155.
This is in relation to the agreed facts before her Honour in respect of Mr Hili, and there is a similar such document at 394, 395 in volume 2 in relation to Mr Jones. So it is in volume 1, pages 154 and 155. In relation to Operation Starlifter, if one goes to the very bottom of the page 154 and the top of page 155 you will see the names of the applicants. If one goes to line 20 on page 154 you have the name of Mr Robert Francis Agius, who is the partner at PKF, Vanuatu, who seems to have been the instigator of the particular scheme. You then have at line 30, employees or partners of OTD, which is Owen T Daniel, chartered accountants in Burwood. Mr Daniel, who seems to have been in charge of that operation, is now deceased.
You then have, starting at line 40, clients of Owen T Daniel, which were the criminal charges instituted at that time and you will effectively have 13 offenders down the bottom of the tree. So you have a classic pyramid structure in relation to an international tax fraud scheme, international operators and designers, being in this case chartered accountants, the Australian promoters, et cetera, and all of the people at the bottom, who are the people who end up participating in this, are the clients of Owen Daniel. Mr Hili and Mr Jones were clients of Owen Daniel. This scheme is introduced to them by the members of that firm.
In relation to that, if one goes to page 313 in volume 1, and it is relevantly the same document, and this is for Mr Hili, and it is relevantly the same document for Mr Jones starting at page 352 in volume 2. If one goes to page 313, this is the three‑page assessment of assistance by the Australian Federal Police in relation to Mr Hili. Do your Honours have that at the end of the first volume of appeal book, 313. Your Honours will see at line 40 that there are 19 taxpayers, all clients of one tax agent who have been investigated and then they say that Mr Agius is the:
ex-pat Australian residing in Vanuatu. AGIUS is a partner of the accounting firm PKF Vanuatu and he was identified as being the promoter of the round robin arrangements. AGIUS frequently travelled to Australia to meet with clients.
They then give an explanation of the scheme. If one then goes to page 315 at line 20, there is a statement effectively of assistance. You then go to around line 45 at 315, the defendant’s assistance as considered high level and the document is signed by the Commander of the Sydney Office of the Australian Federal Police. Then one goes to about line 35, the witness statement is to be used:
in the briefs of evidence in the prosecution of AGIUS and a number of accountants from Owen T Daniel & Co.
So what you are having is the past and future assistance in relation to having given witness statements with the section 21E undertaking in relation to the prosecution of the overseas promoter and the Australian accountants.
The situation, as I understand it, is that in the last month or so, the overseas promoter, Mr Agius, and the Australian accountants have been indicted in the Supreme Court of New South Wales to stand trial. Her Honour has obviously taken into account the level of assistance here, that they have come forward early and are giving evidence in relation to the prosecution of the overseas scheme promoter, the chartered accountant of some local offshoot of a major accounting firm, and an Australian accounting firm. Her Honour has considered that to be a significant matter. That is a matter which her Honour is entitled to take into account under 16A(2).
BELL J: I think there is no issue about that. The Court of Criminal Appeal accepted it and indeed applied the same approach, not only with respect to the head sentence which was fixed by the court, but indeed to the pre‑release period.
MR SVEHLA: Except they said you cannot go below 50 per cent. That was their proposition. They said 50 per cent is it. The special circumstances of the applicants only permitted 50 per cent. To go below 50 per cent of the pre‑release period as a proportion of the head sentence is manifestly inadequate. That is what they found.
BELL J: Her Honour had not departed from that to the 40 per cent. That is the point you are making.
MR SVEHLA: Yes, exactly. That is all I am saying. When you analyse the actual facts and when you analyse the evidence her Honour had regard to in coming to the proportion of the pre‑release period of the head sentence, it was very significant and material evidence, and that the plea was conceded to be at the earliest possible opportunity, whereas if you did not have that and you had a committal, for example, in this matter, it would have been like a large commercial cause, your Honour, given there was some, between them, I think, about 26 international round robins with money moving all over the place. It would have been a very significant matter. None of that was required. They both saw the Australian Federal Police, I think, firstly on 21 May 2008. They gave taped interviews on 22 May 2008. It was not until months after that that they were charged.
BELL J: Speaking for myself, Mr Svehla, I think it is not in issue that they gave thoroughgoing assistance to the authorities. Equally, one can think of other cases where the assistance to the authorities places people at risk within the prison system. That is often taken as an additional reason. It is not a matter to which 16A directs attention, but I think there is authority that nonetheless, it is proper in sentencing federal offenders to take it into account. I think it is common ground that was not a consideration here. In other respects, the assistance was extensive and complete.
MR SVEHLA: So the issue one has to face, your Honour, is where her Honour has given that weight to these matters she has still given weight to general deterrents. She has adjusted the proportion in the exercise of her discretion, which she is permitted to do and you just do not say no, that is manifestly outside the range. So trying to debate, your Honour, on that proposition, the Court of Criminal Appeal has just said no, 50 per cent is it.
GUMMOW J: Can you just look at Wong for a minute in 207 CLR 584 and perhaps also at paragraph 42 in the Court of Appeal, the statement:
the sentence imposed in these matters is so far outside of the range of sentences available that there must have been error.
With that in mind, if one goes to Wong, one sees at page 602 in the joint reasons the statutory structure which draws in, to some degree, the State system so far as it is applicable under section 68 of the Judiciary Act. Then one goes over perhaps to paragraph 58 where there is a reference to House v The King and to two sorts of error:
First, there are cases of specific error of principle. Secondly, there is the residuary category of error which, in the field of sentencing appeals, is usually described as manifest excess or manifest inadequacy. In this second kind of case appellate intervention is not justified simply because the result arrived at below is markedly different from other sentences that have been imposed in other cases. Intervention is warranted only where the difference is such that, in all the circumstances, the appellate court concludes that there must have been some misapplication of principle, even though where and how is not apparent from the statement of reasons.
Now, do you rely on that?
MR SVEHLA: Yes. Yes, I was going to take your Honours to those passages. That is the best statement I have been able to find of the jurisdiction of the Court of Criminal Appeal in relation to the appellate sentencing as the State court picked up under 68. That statement there, it effectively says you have to infer there has to have been a misapplication of principle even though it is not apparent from the statement of reasons.
FRENCH CJ: So you could tick all the boxes under section 16A and still come up with an erroneous result on the application of that principle?
MR SVEHLA: That is legally possible, your Honour, yes, but it is going to be less likely.
HAYNE J: Why? Why is it less likely? Manifest excess, manifest inadequacy arises only for consideration where you cannot identify a specific error and in a Commonwealth setting specific error would be demonstrated by failure to advert to the 16A consideration. So that manifest excess, manifest inadequacy in a federal setting is, I would have thought, likely engaged only where the trial judge has specifically adverted to all of the 16A considerations, but nonetheless has arrived at a result which an appellate court concludes the usual expression, it falls outside the range, but is a sentence of a kind that bespeaks error of a kind that cannot be identified.
MR SVEHLA: I accept what your Honour says.
GUMMOW J: The task then of the Court of Criminal Appeal in this case would be to go to step one and then if need be go on to step two. They do not seem to have done that.
MR SVEHLA: No.
BELL J: In Dinsdalev The Queen (2000) 202 CLR 321 one finds reference to the approach in the context of a State sentence of the approach with respect to a challenge of manifest inadequacy in the joint reasons of the then Chief Justice and Justice Hayne at 325, paragraph 6, where it is pointed out that:
Manifest inadequacy of sentence, like manifest excess, is a conclusion.
MR SVEHLA: Yes, and also 26 and 57 to 61. Yes, your Honour, but it then requires a serious reasoning process to identify how and why it is manifestly inadequate if the process of reasoning undertaken in the reasons for sentence of Judge Morgan, to use Justice Hayne’s expression, “ticks all the boxes”, which her Honour did. You just do not come up and say it is manifestly inadequate. There has to be some analysis here of the specific things her Honour took into account.
There is no taking of those matters into account by Justice Rothman at all. There is no analysis of where someone is giving evidence in respect of the overseas and Australian scheme promoters how, in a scheme case, which could otherwise be difficult to prove, that to give a generous discount in that case is inappropriate.
Remember, these are the first people that – it is the first appeal in the whole of Project Wickenby and, as I understand it, there are over 20 separate scheme investigations going on in Project Wickenby and one has to consider within that the notion of the benefit to the community which is ultimately what underlies the adjustment of the pre‑release period and recognisance release order.
I think that is something that Justices Keane and Fraser referred to in Ruha because they gave specific reference to the issue of the adjustment of the pre‑release period when dealing with the norm issue, the benefit to the community in investigation of this scheme and also sending a message in relation to other schemes because the whole purpose of Project Wickenby when one underlies it, is to try and stop this type of tax evasion going on and involving international operations, hidden bank accounts, et cetera, et cetera, to stop professionals being involved and promoting it, stop people participating, et cetera.
Now, if one gives someone who is at the bottom end - a participant introduced by the higher level accountants, et cetera, who are the fiduciary, that does not excuse the offence, but – Hili and Jones are not people who went out there and thought this up. If they are prepared to assist early why is it not an appropriate exercise of the sentencing discretion for the pre‑release period to give those people the generous discount? That is the benefit of the community and it is sending something out there to these types of cases generally.
FRENCH CJ: Coming back to this question of inferred error, at paragraph 41 in the Court of Criminal Appeal, page 927, in the last few lines Justice Rothman says:
manifest error is fundamentally intuitive. It arises because the sentence imposed is out of the range of sentences that could have been imposed –
et cetera, and again in 42 he talks about the range of sentences available. What is his Honour referring to there when he talks of “the range of sentences that could have been imposed”? Is that suggesting that there is some a priori limitation he is defining as to what is within the bounds of reasonableness and anything outside it is House v The King or is it circular?
MR SVEHLA: I am not sure. It is one or both, your Honour. My respective submission is that is just an incorrect approach to the exercise of appellate review. Using those words disguises other things which is what should really be addressed. There is no identification of the range of sentences that could have been imposed. One just does not know, your Honour. One does not know what is taken into account, have no idea. I do not know if it is just tax cases, if it is cases within a particular monetary amount, if it is only cases where someone has given an early plea of guilty. One just does not know, have no idea.
It is not like Bernier or Ruha or the Queensland cases, including Tran which is a very considered judgment of Justices Keane, I think Fraser and Atkinson, where they look at what are the comparable cases, Bertilone in Western Australia. If one had that form of analysis that tried to set some guideposts here for this type of offence and said, “Look, we are looking at cases that only involve tax or specific amounts of money, scheme”, one could have then given some content to this and ‑ ‑ ‑
BELL J: His Honour does discuss revenue offences, commencing at paragraph 13. I would, for my own part, infer that he was speaking with revenue offences in mind when he expressed a conclusion of manifest inadequacy.
MR SVEHLA: Yes.
HAYNE J: We know the bottom of the range or what is close to the bottom of the range, see paragraph 43, “I would fix a sentence at the low end of the available range” and that is the sentence that is passed.
MR SVEHLA: Yes. I do not know what it is that has informed that, your Honour. I just have no idea why that is the lower end of the range.
HEYDON J: This is a nasty, very dishonest crime.
MR SVEHLA: I accept that, your Honour. There is no issue about that. I am not trying to hide from that in any way. To come back to what I said earlier, the starting point of Judge Morgan is clearly more than three years because three years was where it would have been but for the three objective facts, early plea of guilty, past and future assistance. So her Honour’s notional starting point, without the subjective features, is higher than that insofar as one has to try and infer.
Her Honour also agrees that that one has a starting point above three years. Where it is, she does not say. We do not accept that three years is near the bottom end of the starting point before you take anything into account. The whole problem with that, your Honour, is when we start to debate all of this it seems contrary to the whole approach in Wong and Markarian in relation to the instinctive synthesis approach because what we are doing is creating some notional starting point and then applying all these discounts. That in itself raises a whole series of issues.
BELL J: At any point a challenge of manifest inadequacy invites attention to what sentence was imposed.
MR SVEHLA: Yes, I accept that.
BELL J: Here, one has a participation over a sustained period of time in a sophisticated fraud on the revenue carried out by individuals for greed, who were of good character, as commonly enough fraud offences will be, resulting in sentences of imprisonment with automatic release after seven months insofar as consideration of the minimum term is concerned. That might of itself pose some issues for your challenge.
MR SVEHLA: I have to come back to the significance her Honour gave to the fact that these are the participants in the scheme designed by professionals, ones that are professionals being their advisors who introduced them to it. That does not get over the greed aspect. All of the documentation is done by the professionals. They sign the tax returns put in front of them by the professionals. They are doing it for greed, there is no issue about that, but they are prepared to give this level of assistance to unravel the scheme and to send a message to others to unravel other schemes. That is a competing issue one has to deal with in this case, in terms of how one fixes the head sentence and the pre‑release period because it is those issues which guided Judge Morgan.
HAYNE J: You have said more than once that the Court of Criminal Appeal’s conclusion is opaque because you do not know what leads it to its conclusion.
MR SVEHLA: Yes.
HAYNE J: Can I put this to you for your consideration? In any case in which the complaint is manifest inadequacy or manifest excess – it matters not which – the premise is that no specific error is demonstrated. Do you go that far with me?
MR SVEHLA: Yes.
HAYNE J: Because no specific error is demonstrated in what the sentencing judge has done, does it not follow that it is to be assumed that the judge in his or her sentencing remarks has disclosed all of the relevant considerations and has not taken to account any irrelevant consideration?
MR SVEHLA: Yes.
HAYNE J: That is, does it not follow in a case of alleged manifest excess, or manifest inadequacy, that the findings made by the sentencing judge stand unaffected by the Court of Criminal Appeal’s intervention and that all that sets what the Court of Criminal Appeal does apart from what the sentencing judge does is, if you like, the last sentence, the conclusion that the appropriate sentence to fix, in these circumstances, thus set out is X with Y.
MR SVEHLA: Yes, but in many instances and in many appeals that may not be what is actually happening and in fact it is a mask for a failure of the appellant to identify, with some precision, a precise error, for example, a failure to take into account a particular matter or take into something irrelevant, et cetera.
HAYNE J: But that is not this case, is it? There is no complaint, is there, on either side of the record that the sentencing judge made any specific error?
MR SVEHLA: The complaint by the Crown is, apart from them being too low, a failure to give reasons as to how the sentencing judge arrived at those amounts in terms of, I assume, comparable cases, et cetera, and the norm in respect of the pre‑release period because the Crown’s position is that in respect of the pre‑release period you apply the norm and then you have had the development of that by the Court of Criminal Appeal. So in relation to the norm aspect of the pre‑release issue, as part of what their Honours have done, they have gone beyond what your Honour is saying and they have introduced the norm.
It has fundamentally infected what they have done there because their Honours are saying that in the “usual case” – whatever that is – you have this very tight bandwidth and in terms of special circumstances, in paragraph 44 at page 928, the issues his Honour took into account are first time offenders:
good prospects of rehabilitation; and the necessity to ensure assistance in assimilating back into the community and dealing with their past alcohol issues.
But in none of the matters which informed her Honour in relation to giving the particular discount she gave, because she says but for the three objective facts of early plea, significant past assistance and promised future assistance, when you understand it in relation to this scheme and whom they were going to give evidence against, I would have had 18 months inside rather than 7 months inside with a commensurate increase of the head sentence.
HEYDON J: I do not understand this submission. The end of paragraph 43 indicates that he is applying a reduction to allow for the plea of guilty and assistance and then he says:
I continue the allowance . . . for future assistance ‑ ‑ ‑
MR SVEHLA: Yes, that is only in relation to the head sentence, not the pre‑release period. There are two aspects; there is the head sentence and the pre‑release period. Her Honour applied the 50 per cent discount for the head sentence but she says but for those three objective features it would have been three years, not 18 months. When her Honour comes to the pre‑release period it is a 60 to 61 per cent discount, so her Honour deals with it differently. When you read her Honour’s reasons, her Honour’s reference to the 50 per cent is limited to the head sentence only; not to the pre‑release period. She gives different weighting and consideration to the pre‑release period, and gives more because of these objective features.
HEYDON J: This may be a very naïve thing to say, but is there not an element of double counting in your submission?
MR SVEHLA: No, because there are separate steps in relation to the federal sentencing regime. The same integers in section 16A(1) and (2) are to be had regard to both for the determination of the head sentence and the pre‑release period as part of the recognisance release order. They are separate steps. There obviously has to be some degree of consideration. As her Honour Justice Bell indicated, a proportionality issue is one of the legal criteria one looks at when determining the pre‑release period. So the consideration of proportionality is considered in determining the proportion of the pre‑release period to the head sentence, but they are separate exercises.
FRENCH CJ: Having come to the position of manifest areas fundamentally intuitive, in recognition of the opposition, I suppose, put to you earlier by Justice Hayne that you have got the sentencing judge, the primary judge has addressed all the relevant criteria under 16A, not addressed any irrelevant criteria for the purposes of this, in fixing the new head sentence, what more can the Court of Appeal say other than that was wrong and it has to be higher, applying all those factors which her Honour had had proper regard?
MR SVEHLA: One should disclose in the reasoning process the cases that one has had regard to that creates signposts for what one considers to be “the range” to this offence, so that one can come to the conclusions that the sentence imposed is manifestly inadequate. I mean, manifestly intuitive is not a divining rod as such because otherwise that is imposing your own sentence which is impermissible. It is really just a shorthand term for what must be a very detailed process of judicial reasoning looking at a range of cases, the purposes of the legislation, all of the objective integers and subjective integers to come to the view that it is so far outside the range.
HEYDON J: This is a rather foreign field for me, but the sentencing judges are very busy people.
MR SVEHLA: I accept that, your Honour.
HEYDON J: They have a huge amount of work to do. They have not got time to be looking at all sorts of different cases that bear on sentences. Of course, they are very experienced people usually and, therefore, they have built into their, modern people would now say, DNA experience without having to list names of cases. There is a bit of a danger of everything getting bogged down, is there not, if that last analysis you were proffering is to be standard?
MR SVEHLA: It is a question of degree, your Honour.
HEYDON J: Justice Howie was party to this judgment.
MR SVEHLA: I accept that, your Honour. Like your Honour, I am not the person that regularly practises in the criminal jurisdiction but I understand that Justice Howie is a very senior New South Wales criminal judge and with a significant amount of experience in sentencing but insofar as I say it is a question of degree one has to do more than what was done here. When one looks at cases like in Queensland in Tran, in Ruha, in Bertilone, one sees an attempt by those courts to try and provide the relevant guideposts within which to operate.
Also, your Honour, this is the first of many. I mean, there are going to be many sentencing decisions arising out of Project Wickenby. Statistically, New South Wales, just from the raw statistics that I have referred to in reply, seems to have at least 40 per cent of federal offences, depending upon the type, even more. We now have a situation where Hili and Jones is the guidepost. There are 13 or 14 other people that have been charged already under Starlifter. We will then have all of the others. So it is a very significant matter and it is important to create some greater assistance in the sentencing task, your Honour. I do appreciate what your Honour is saying, I mean one cannot go too far the other way, I accept that.
HEYDON J: The analysis that intermediate appellate criminal courts of appeal engage in, of course, by force of circumstance they feel some obligation to go into considerable detail. It is not the position of sentencing judges. It just cannot be done.
MR SVEHLA: I accept that ‑ ‑ ‑
HEYDON J: Some crisis has arisen in the system when a successful or unsuccessful appeal is brought. Intermediate appellate judges have a fair amount of time on their hands compared to trial judges, sentencing judges. It is their trade to look around the world and look around the whole Australian scene and get very detailed – it is just not possible at trial level.
MR SVEHLA: I am not suggesting that it has to be at that level.
GUMMOW J: This judge gave most detailed reasons.
MR SVEHLA: Yes, she does not refer to comparable cases but our analysis is the sentencing judge does not have to do that because as your Honour indicates they are doing it day in day out. They are getting information from their colleagues. They are getting the judicial statistical information. They are reading cases and they are applying the instinctive synthesis approach in doing it. But where the appellate court finds that a particular sentence is manifestly inadequate there is a different requirement ‑ ‑ ‑
HEYDON J: I see. So your submission is limited to the appellate court. I think about 10 minutes ago you were talking about both.
MR SVEHLA: I apologise, your Honour. I was only seeking to talk about the appellate level and Ruha and Tran and Bertilone are all appellate decisions. I am not trying to in any way suggest that a sentencing judge should engage in this. In fact, we say that they should not, for the very reasons your Honour put.
GUMMOW J: The problem with the phrase “fundamentally intuitive”, which may be a synonym for “visceral”, is that it suggests that what is involved here is the heart having its reasons that – reason does not know to apply Pascal. That does not seem to be a very apt exercise of judicial power of the Commonwealth to my mind.
MR SVEHLA: Applying Justice Hayne’s reasoning ‑ ‑ ‑
GUMMOW J: We have a similar problem in the situation in the intermediate Courts of Criminal Appeal that we had to deal with in Weiss.
MR SVEHLA: His Honour Justice Hayne’s analysis, the fundamentally inadequate or excessive, at the end of the day does not mean equal is fundamentally intuitive. It is a far more rigorous analysis that underlies that.
BELL J: Somewhere in all of this is the consideration emphasised strongly in Wong of the importance that there should be a degree of consistency in sentencing and that it is unfortunate if the sentencing outcome reflects the haphazard selection of the judge who imposes it. So it is recognised that intermediate Courts of Appeal have an important role to play in establishing consistency. So a lively question arises, how they do that in circumstances where the Commonwealth has set out a non‑exhaustive list of matters to be taken into account, has not, with respect to the setting of the minimum term, given any guidance as to what principles are to inform that process, resulting in an order for automatic release at the conclusion of it in relation to many non‑parole periods and all recognisance release orders. So the question becomes, how the intermediate court approaches that task.
Sometimes it can be by reference to looking to a range of cases that are broadly comparable, so that, for example, with respect of federal offenders, the field of importation of drugs has provided for many years a sufficiently ample number of cases to enable that exercise to be done. In other fields there will be less of an obvious cohort of cases to identify, but the court still has a role to play. You say that the court was wrong here to identify a range as specific as 60 to 66 per cent and then, in particular, to apply the language of the State Sentencing Act and the notion of special circumstances. Would you submit it was wrong if the court were to say, as a general proposition in serious offences involving the imposition of prison terms, there ought be some proportion between the minimum term and the head sentence in order to reflect deterrents, something of that character?
MR SVEHLA: I think in the terms expressed, yes, but we are not submitting that the court, as is indicated in Wong, does not have a role to enunciate principles which regard should be had in federal sentencing. What you cannot do – so, for example, in Cameron, to say that the plea of guilty facilitates the course of justice, that is an enunciation of a principle in relation to a specific sub‑provision in section 16A(2) that was framed in a particular way so as to ensure that it did not offend the principle of equality and discrimination amongst federal offenders, vis-à-vis, those who do not plead guilty.
Also statements, for example, that in relation to taking into account the effect, I think, in 16A(2)(p) on a person’s family there are judicial pronouncements that you only look at that in the exceptional case rather than the usual case. The judicial pronouncements that general deterrence is an important matter, yes, but to then go beyond that and to try and frame a proportion in some way or to come close to that, the applicants would submit, is to go beyond what can be done because you are introducing something into Part IB of the Crimes Act which is not there and does not permit. Because the interaction of 19AF, 19AC and 20(1)(b), which deals with a recognisance release order for a head sentence of three years or less, prescribes the range forthwith ‑ ‑ ‑
GUMMOW J: What section, Mr Svehla, 20(1)?
MR SVEHLA: Your Honour, if one goes to section 19AC(1):
Subject to subsections (3) and (4), where:
(a)a person is convicted of a federal office, or of 2 or more federal offences at the same sitting; and
(b)the court imposes on the person a federal sentence that does not exceed, or federal sentences that, in the aggregate, do not exceed, 3 years; and
(c)at the time the sentence or sentences are imposed the person is not already serving or subject to a federal sentence;
the court must make a recognizance release order in respect of that sentence or those sentences ‑ ‑ ‑
GUMMOW J: That is a reference then to section 20(1), is it not?
MR SVEHLA: Yes. We then go to the definition. We then go to 20(1)(b) which is picked up by the definition in 16(1) of:
recognizance release order means an order made under paragraph 20(1)(b).
The sentence to imprisonment:
direct, by order, that the person be released, upon giving security of the kind referred to in paragraph (a) either forthwith or after he or she has served a specified period of imprisonment in respect of that offence or those offences that is calculated in accordance with subsection 19AF(1).
When you go to 19AF(1) it simply says that you must:
make a recognizance release order such that the pre‑release period ends, not later than the end of the sentence –
In other words, the pre‑release period cannot be more than the period of the head sentence. That was introduced when one goes to the explanatory memorandum because historically pre‑release periods were being given beyond the head sentence in some instances. So it was under the old legislation. When you deconstruct it, under 19AC for a federal sentence or an accumulation of federal sentences where it is no more than three years, you must have a recognisance release order. Mr Hili is one federal sentence. Mr Jones is three federal sentences. So you get both alternatives in play here. Both are three years or less by the Court of Criminal Appeal, 18 months by the sentencing judge.
FRENCH CJ: It is the character of that recognisance release order as an order that attracts for it the consideration of the factors under 16A and that was accepted in Ruha as well, I think.
MR SVEHLA: Yes, exactly, and in Bertilone subsequent to that and subsequent decisions to that I think including in Baldock recently in Western Australia. Forthwith, or up to the period of the head sentence is the range. That is the statutory range of a pre‑release period, zero to 100 per cent of the head sentence.
FRENCH CJ: When one is talking about – I hesitate to use the word “norm” – practices imposing somewhere between 60 and 66 per cent in the context of the judgment of the Court of Appeal here, that is applied or inferred without discrimination between non‑parole release and pre‑release periods.
MR SVEHLA: Yes.
FRENCH CJ: You are not suggesting there is any material distinction between those things?
MR SVEHLA: Our first proposition is no, but specifically insofar as my clients are dealing with pre‑release recognisance release orders, if this Court does not want to go beyond that you can deal with it on that basis but in the wider proposition, no, we cannot see that and we expressly refer to the fact I think in 19AG due to terrorism offences they have introduced the 75 per cent minimum.
I think under the Migration Act there are certain offences where you have statutory minimums. All of that is there because the structure of Part IB does not permit of a specific period and the entire thing is at large but it is not at large in an unprincipled way. It is not at large in a way that the Court cannot give guidances to the matters that should be taken into account. You do not impose some prescription into it. It is the very thing you do not do. It is the very thing that Wong said you do not do, be it in a different context relating to the narcotics schedule.
Then in 20(1)(a), which is the elements of a recognisance release order, in terms of fixing the period one can have a recognisance release order that can be, in 20(1)(a)(i), “will be of good behaviour for such period, not exceeding 5 years”. In this case it was to the period of the head sentence, but a sentencing judge could make it a sentence of three years or less – five years. In other words, if you are not of good behaviour up to five years, which could include two years after the end of the head sentence if it is a three‑year head sentence, you can be brought back and sentenced. So you have to understand how the structure of the recognisance release order works and the way in which it is seeking to adjust the position, vis-à-vis, the offender and the position for the community.
Section 20(1)(a)(ii), orders for reparation or making compensation, you can order monetary compensation. Here that was not done because of the reparation which had occurred and the, basically, regime entered into by Hili and Jones to pay back everything, not only primary tax which has already by paid, but paying back all the penalties and not only on behalf of themselves, but on behalf of the companies. So the nature of the reparation that they are making for primary offences of around $330,000 to $370,000 is in the order of one million dollars each and those offences, when you deconstruct it, relate to the companies’ position as well.
BELL J: I am not sure that is a particularly attractive argument, is it?
MR SVEHLA: All I am trying to indicate in terms of fixing a proportionality, your Honour, these are all part of the things that the statute says you have regard to in terms of determining the period inside, because in determining the pre‑release period, you can also fix a recognisance release order that requires compensation; be of good behaviour for a certain number of years and other matters. So in determining the guidance a court gives, you have to have very careful attention to the statutory scheme and to the options available to you and the fact that if the offence is for three years or less is a head sentence, when you carefully construe Part IB, it is telling you things. It is telling you there are a range of sentencing options available which would be taken into account and so that, insofar as one is giving judicial guidance, one does not prescribe a strict proportion. One says one should take those matters into account. You should take into account whether or not there is an appropriate proportion between the pre‑release period and the head sentence, but you do not go beyond that.
BELL J: That would make consistency a rather difficult goal to achieve, would it not?
MR SVEHLA: The highest form of consistency would be achieved through the Commonwealth amending the legislation to prescribe minimum periods of imprisonment. There is no doubt about that. But the notion of reasonable consistency that Justice Gleeson speaks of in Wong, which has been dealt with by Justice Keane in Tran and the Court of Appeal in Queensland and Ruha and Bertilone in Western Australia, the notion is reasonable consistency having regard to Part IB of the Crimes Act and, within that structure, having regard to what an appellate court can or cannot say to achieve reasonable consistency. What that means, your Honour, is that an appellate court in giving guidance should look beyond the particular State. It cannot stay intrastate because it is exercising the one federal judicial power.
Reasonable consistency means you have regard to offences which are relatively comparable, and taking into account the similarities and the like that one can. For example, Bertilone is a very good example of the Court of Appeal in Western Australia doing that in relation to drug importation offences and giving a very careful analysis of those offences throughout Australia.
BELL J: Could I just take up your third special leave question, just so I understand it? Your complaint is with the form of the court’s order in relation to the applicant, Mr Jones.
MR SVEHLA: Yes.
BELL J: Does it turn on the circumstance that having determined not to interfere with the money‑laundering sentence one has an extant recognisance release order that should not be there. There should be one recognisance release order. Is that ‑ ‑ ‑
MR SVEHLA: Yes, your Honour. The way 19AC works is that if you have two or more federal offences for the one federal offender, and he receives two or more federal sentences for each federal offence, and the totality of those, whether by accumulation or aggregation, the total period is no more than three years ‑ ‑ ‑
BELL J: You have a single recognisance release order.
MR SVEHLA: Yes, that is it.
BELL J: Yes. All right, now is the complaint that there should have been some interference with the sentence on the money‑laundering offence in order to address the circumstance that at the moment one has two recognisance release orders. One has Judge Morgan’s recognisance release order in respect of the money‑laundering offence and the single recognisance release order in relation to the two offences in respect of which the Court of Criminal Appeal quashed her Honour’s sentence and imposed fresh sentences.
MR SVEHLA: Yes, and the fact that you – yes.
BELL J: It is, I think, not a strong special leave point. It is a technical matter that could be corrected under 19AH. I think that is the respondent’s submission.
MR SVEHLA: They did not fail to make a recognisance release order. They have botched up their power under 19AC. You can only have one recognisance release order. You cannot decide to make it for two and not for one. I am not sure if 19AH(2) is the power that fixes that up. It is just beyond power. It just should have been one recognisance release order, full stop. Then to try and deal with it, they then have regard to 19AC(4) and (5). His Honour has expressly said that there should not be a recognisance release order for that offence and gave reasons.
Now, apart from the fact that you cannot do that, in 19AC(4) that power seems to be exercised where you have regard to the nature of the circumstance of the offence and the antecedents of the person. Well, Mr Jones had no antecedents. The whole thing is just a misapplication of power and just should be fixed up because we have a unanimous judgment in New South Wales Court of Criminal Appeal misconstruing the operation of the recognisance release order in respect of multiple offences. It is not a matter that should affect the ultimate sentencing decision because this Court can fix that up, but you have that decision out there which is error in a material issue.
BELL J: I just want to be sure I understand the error. It is not that you are contending that a single recognisance release order was not made in relation to the two offences for which the Court of Criminal Appeal sentenced Mr Jones or is it that?
MR SVEHLA: No, it is not in relation to that. It is the fact that it decided that in relation to the money laundering offence there should be no recognisance release order and you cannot do that. You cannot have three offences and decide to give a recognisance release order for two of them and then apply 19AC(4) and (5) and have no recognisance release order for the third one.
BELL J: Can we go to the orders and just see how that works out?
MR SVEHLA: Sorry, it is not easy. I think it is at page 933. This is the “Notification of the Court’s Determination” which is the entry of the orders.
BELL J: Yes. Now, the court set aside the sentences for counts 1 and 2 and resentenced, that is in order 3, and it set in order 3(c) a single recognisance release order.
MR SVEHLA: Yes, and so therefore ‑ ‑ ‑
BELL J: Where is the order of which you complain setting aside the recognisance release order in relation to the money‑laundering offence? I think the issue is, is it not, that that sentence was left standing when the court should have made orders dealing with that third count in a manner that either produced the single recognisance release order or imposed a fixed term.
MR SVEHLA: No, it could not do the latter.
BELL J: You say it could not impose the fixed term?
MR SVEHLA: Yes. When you look at the reasoning process ‑ ‑ ‑
BELL J: I am not concerned with the reasoning purpose at ‑ ‑ ‑
MR SVEHLA: No, it could not do the latter, your Honour. It could not decide in respect of the third sentence to impose a fixed sentence with no recognisance release order. You cannot subdivide up that process as between the federal sentences.
FRENCH CJ: I suppose the question is whether you can read 3c) as intended to be applicable to all three counts.
MR SVEHLA: Yes.
FRENCH CJ: That might have just been a slip, really.
BELL J: That would produce a difficulty of a recognisance release order of the same length of the sentence. Is that problematic?
MR SVEHLA: If you could please repeat that, your Honour? I missed that.
BELL J: The court did not interfere with Judge Morgan’s sentence on count three, so that it was a sentence of 18 months, was it not?
MR SVEHLA: No. All three were 18 months by Judge Morgan.
BELL J: So the court did not interfere with that? That sentence carried with it a seven month recognisance release order, which is not dealt with in the orders that the court made. The court set aside the sentences on counts one and two.
MR SVEHLA: That is correct.
HEYDON J: If you won on this ground of appeal, but not the others, what practical difference would it make to Mr Jones?
MR SVEHLA: None. I accept that, your Honour. There are two things. One is a matter of we have a unanimous decision of the Court of Criminal Appeal misconstruing the application of recognisance release orders in relation to multiple federal offences. Secondly, it is an indicator of the lack of understanding in approach of the Court of Criminal Appeal to Part IB and how it operates, and so we use that as part of the reasoning process for their lack of reasoning, so it works in both those ways, your Honour. It does not get my people my out any earlier.
HEYDON J: Well it is only Mr ‑ ‑ ‑
BELL J: It is a matter of oversight, Mr Svehla. The court, for reasons which were explained, took a view about the money‑laundering count favourable to your client, chose not to interfere with it and then omitted to consider the significance of the outstanding recognisance release order, notwithstanding that the court fully appreciated the need for a single recognisance release order because that is how it structured the two sentences that it interfered with and did impose. I think that is another way of looking at it.
FRENCH CJ: I think that has taken us to the last page of your submissions.
MR SVEHLA: It is not a major point, your Honour. Unless I can be of any further assistance to your Honours.
FRENCH CJ: Yes, thank you very much. Mr Neil, we might adjourn until 2 o’clock.
AT 12.27 PM LUNCHEON ADJOURNMENT
UPON RESUMING AT 2.02 PM:
FRENCH CJ: Yes, Mr Neil.
MR NEIL: May it please, your Honours.
FRENCH CJ: Mr Neil, before you start, if at any stage you would like a short adjournment, do not hesitate to ask.
MR NEIL: I am very much obliged, your Honour. Your Honours, firstly the respondent presses its opposition to the grant of special leave in these matters for the reasons outlined in the written submissions, in particular, in the special leave application submissions which appear in volume 3, commencing at page 957 and going through as to the first three special leave questions to 962 and are then referable only to Mr Jones, the remaining special leave question about the recognisance release period at volume 3, 996 to 997.
May I endeavour, your Honours, to, as quickly as possible, and I probably need only one minute to deal with that matter. Your Honours, we have set out in the supplementary materials to our written submissions under tab F a copy of section 19AH of the Crimes Act, which your Honours will see as “Failure to fix non-parole period or make recognizance release order”.
Subsection (1) means that if there is an error it does not affect the validity of any sentence. Subsection (2) means that there is a remedy to go back to the court that made the error and have it corrected. Now, that court, if there was an error, and for the reasons we submitted we do not concede that, would be the Court of Criminal Appeal of New South Wales. It would only be, your Honours, with respect, if that process had been followed and the court had come out with reasons that our friends said were wrong in law that your Honours would entertain that question, but because there is no effect upon the actual validity of the sentence, and my learned friend is very fairly conceded it cannot have any effect upon the mandatary imprisonment term for Mr Jones, we would submit it is really not a special leave question.
Your Honours, unless your Honours would wish me to recount what was put in writing on the special leave points, I would wish to briefly go to some authorities and endeavour to illustrate the fundamental factors which we submit apply. They bear also on some other considerations that arise should special leave be granted, such as the question about the power of an intermediate appellate court to intervene if it is convinced that there is a manifest inadequacy of sentence below.
Your Honours, we have these on our list and there are just a few passages that are germane, in our respectful submission, to those principles. The first is White v The Queen 107 CLR 174, a decision of Chief Justice Dixon and Justices McTiernan, Kitto, Windeyer and Owen, where at page 176, it is a very short judgment, in the penultimate paragraph the principle about what has to be satisfied in a sentence matter for special leave to be granted is set out, “We would not intervene unless there appears to have been a gross violation of the principles which ought to guide discretion in imposing sentences.”
We say that has never been questioned. I would then go, your Honours, to Lowe v The Queen.
GUMMOW J: They are not talking about prosecution appeals against sentence, are they?
MR NEIL: I had understood that they were, your Honour, with respect. No, they may not have been but I think your Honour is correct.
GUMMOW J: It would be unusual in 1962 if they were.
MR NEIL: Our submission is that it applies to both sides but there must be demonstrated a gross violation. In Lowe 154 CLR 606, a decision of Chief Justice Gibbs and Justices Mason, Wilson, Brennan and Dawson, of course as their Honours then were, in the reasons of the Chief Justice at 608 at the bottom of the page – this of course was the prisoner’s appeal:
This Court has consistently held that it will not grant special leave to appeal simply because a sentence appears to it to be excessive -
et cetera. We say it cuts both ways. Then the repeat at the top of page 609:
it must appear that the case involves some question of law or principle of general importance or that there has been a gross violation of the principles which ought to govern discretion in imposing sentence -
Now, your Honours, our primary submission here is that the Court of Criminal Appeal of New South Wales was correct, and unimpeachably so, however they arrived at the decision but concluding that the sentence was imposed by the learned sentencing judge, her Honour Judge Morgan, both as to the head sentence and as to the mandatory periods of imprisonment were manifestly erroneous.
I want to come on to point out, if I am able to persuade your Honours, that that is a separate and distinct ground of appeal that does not depend in any way on the discernment of specific error, indeed, any error, other than the result being so aberrant compared with the intermediate appellate court’s own experience, which is extremely important in the evaluation of these factors and cannot be discounted and, we would submit, is presumed to be broader than that of an individual sentencing judge, that it is a most important factor. In Lowe, at 624 in the first full paragraph in the reasons of Justice Dawson – your Honours, some of these principles are so well known I just might identify the paragraph.
Our learned friends seem to be saying, at least in their written outline, that all the Court of Criminal Appeal did here was substitute its own opinion for that of her Honour Judge Morgan. Justice Rothman made plain at paragraph 40 that that was the last thing he was doing. He identified the correct test and he applied it. He specifically said, “That is not what I am doing.” Your Honours, then of some relevance – and we have it on our list, I do hope your Honours have it – is a very short transcript of a special leave application in the matter of Skaf [2006] HCATrans 10 of 3 February 2006. There, your Honours, at the end of my printout – your Honours, it does not seem to have specific page numbers, but at the very end Chief Justice Gleeson, in the third paragraph on that page, spoke about:
a more fundamental problem with this application. This Court is not a Court of Criminal Appeal.
Pausing there, that emphasises the importance of the role of the intermediate appellate Court. He concluded –
It does not intervene simply on the ground that its own appreciation of the seriousness of a particular case may be different from that of a sentencing judge or a Court of Criminal Appeal.
Finally, your Honours, the transcript in Russell v The Queen, S60/1997, [1998] HCATrans 35. Again if I may, your Honours, on the last page, which is page 3, in the remarks of Chief Justice Brennan, as he then was:
The level of sentencing is pre‑eminently a matter for the courts of criminal appeal of the States and Territories.
We place some store by that in drawing the contradistinction between the important role of the intermediate appellate court and the sentencing judge, but, ultimately, it is the intermediate appellate court that is, in very broad terms, the arbiter for its jurisdiction, not the sentencing judge where this question, in particular, of manifest excessiveness or manifest inadequacy of sentence is the key issue. We say our learned friends have not met those tests, with respect.
Your Honours, if I may move, please, to – and I am happy to do this in whatever order is most convenient to your Honours, but our friends in their – and if it is not inconvenient, I would prefer to stick to the same order as my friends and deal with those seriatim. My friends then went to what we call, and I hope we are not being disrespectful to our learned colleagues, the so‑called New South Wales norm. We have submitted it is a misnomer. We have submitted there is a misunderstanding of what Justice Rothman was really saying, and I hope to illustrate that to your Honours very shortly.
Before doing that, we have put in our supplementary materials two papers which we submit are of substantial relevance because they go to the constitutional circumstances in which State and Territory courts are invested with federal criminal jurisdiction and I would need to commence, your Honours, at B. Your Honours should have a tab B which commences with a paper of Messrs Adsett and Pedley of “Variations in Federal Sentencing” delivered at the Sentencing Conference at the Australian National University of the National Judicial College of Australia, February 2010.
Just interposing, if I may for convenience - I hope I do not forget to come back to take your Honours briefly through annexure A later, but just so your Honours know, that is a summary of what appear to us to be the relevant decisions bearing on these issues before the CCA decision under challenge and subsequently thereto.
One of the brief points we make is that – I know I have jumped back to A, I do apologise – cases, the last three, 15, 16 and 17 are all Wickenby equivalent type offences that have been the subject of sentence by different District Court judges since the applicants, Messrs Jones and Hili, and in not one of them has the sentencing judge felt bound by the so‑called New South Wales norm of a minimum non‑mandatory imprisonment period of 60 per cent. The highest that has been imposed is 50 per cent and in one case there was an order for immediate release, due to particular medical and other reasons.
HEYDON J: What is the defining characteristic of a Wickenby case? Is it the manner of contravention or is it parties?
MR NEIL: It is both, your Honour. It is really this system of those groups of private profitable small business companies with an individual director or possibly a husband and wife director and sole shareholders who joined in the scheme that the Crown alleges Mr Agius, based in Vanuatu, and three local accountants, indeed four, one now deceased, based in a chartered accountancy practice at Burwood, concocted and applied.
HEYDON J: So Mr Wheatley was involved with Mr Agius’ arrangements?
MR NEIL: Mr Wheatley was not. He was involved in one involving a Mr…..whose computer was found somewhere and brought all this to light. We did put that forward to her Honour and to the Court of Criminal Appeal - and I wish to take your Honours to our written submissions below – as at that time, because Messrs Hili and Jones were the first to come for sentence under what we have called the Starlifter or the Vanuatu/New Zealand/Australia round robin scheme, Mr Wheatley had come up in Victoria a little time before but there are considerable analogies between them both as to objective criminality, subjective features, maximum discounts for co‑operation and so on and so forth.
Your Honours, we adopt part of this material in the paper of Adsett and Pedley, with respect, by way of submission and in the written outline we have identified specific pages from about page 6 but I would invite your Honours, without wanting to take the time now, to perhaps, if your Honours are prepared to do this, start from page 1 to see what they were seeking to achieve but the bottom line is that they covered the whole of Australia and at the end they go State by State and they found in fact reasonable consistency throughout Australia in ‑ ‑ ‑
FRENCH CJ: A lot of that was taken from Bertilone, was it not?
MR NEIL: They certainly referred to it and they have referred to just about everything that has come up in Ruha and in subsequent cases. Very importantly, your Honours, at page 6 they address Leeth and they go on to address Putland and in essence they point out that because of the arrangements, constitutionally, between the Commonwealth and the States Part IB does not cover the field. We know that, for instance, because section 16A itself does not even include, as one of the factors to be taken into account, general deterrence. They point to major differences between the States in terms of their local sentencing practices for local offences for similar type of criminality, primarily in the drug field. One of the major differences they point to is this. In New South Wales for the bulk of offences there is a mandatory statutory non‑parole period of 75 per cent.
GUMMOW J: Page 9, was it not?
MR NEIL: Yes, your Honour. No such circumstance arises in Queensland nor does it appear to apply in Western Australia and when one went later to the reasons of Justice Fryberg in Hargraves and Stoten where he disagreed with Justice Rothman’s statement about the 60 per cent minimum and he correctly, with respect, identified that as a statement of dictum not obiter, one of the reasons he disagreed was because of that kind of local circumstance and particularly in Hargraves and Stoten Justice Fryberg pointed out that there are extremely few offenders in Queensland, other than of the most violent kind, who serve more than 50 per cent of their head sentence in Queensland in custody.
Now, in New South Wales it is 75 per cent for equivalent crimes. Queensland has the common law, New South Wales has a statutory mandate and he said, “I am not able to apply what Justice Rothman has suggested because it is not applicable in Queensland.” Nevertheless, and we pointed in our written outline to the facts in Hargraves and Stoten in terms of objective criminal gravity and very similar subjective features, nevertheless, even so, even there Justice Fryberg imposed a mandatary term of imprisonment of about 58 per cent. He was not very far from the 60 per cent, although he gave his reasons for disagreeing.
One reason why we say the norm is a so‑called norm is that here, as we know, the Court of Criminal Appeal, through Justice Rothman’s reasons, in fact applied 50 per cent. Now, this paper, when your Honours read it, is significant because it points out, if I just take your Honours – and may I pause and say I do apologise, we had intended to put in the supplementary book the graphs in colour and we overlooked it. The library here last night was very kind and made us extra copies and I actually have copies with the colour graphs, if they would assist your Honours. I must say, trying to work out eight different shades of grey, I found a difficult task last night and if your Honours have it in colour, it is much more real. As I say, they are right here if it would assist and I am sorry for this, your Honours, it is just one of those things that went through to the keeper. I have nine copies. I will hand up as many as your Honours would find convenient, and my learned friend has one.
KIEFEL J: While that is being handed around, forgive me, but to what issue is the paper or the papers to which you have referred in the supplementary materials address? What does it establish for our purposes in relation to the application for special leave?
MR NEIL: Your Honour Justice Kiefel, it establishes that while there is clear authority in the civil jurisdiction through Farah Constructions and other cases, the Court of Criminal Appeal of New South Wales last Friday in a case we put on our list of Director of Public Prosecutions (Cth) v De La Rosa all speak of the desirability of uniformity of the sentencing of federal offenders across Australia. Now, this paper points out that not all federal offenders across Australia – and what is means is offenders who are not in the same State or Territory as others – are not all subject to the same laws because local laws have an impaction upon the process and upon, effectively, in particular, minimum periods of mandatary imprisonment.
Because as Justice Fryberg pointed out in Hargraves and Stoten, in a State where miniscule numbers serve more than 50 per cent of the head sentence, it gives rise to a natural sense of grievance for a federal offender to be sentenced to 66 per cent as a minimum term, and that is a relevant distinction that he drew with New South Wales where he said he was not prepared to apply Justice Rothman’s dictum.
KIEFEL J: Is this by way of showing that the New South Wales Court of Criminal Appeal’s sentences imposed are not out of order?
MR NEIL: It is. I want to go on to show to your Honours how, before IB was enacted, there was clear authority in two decisions of the New South Wales Court of Criminal Appeal that have never been challenged, so far as the respondent is aware, to the effect that under the common law the general proportion of non‑parole period to head sentence was two‑thirds. When the Sentencing Act (NSW) came in in 1989 and said minimum of 75 per cent, the Court of Criminal Appeal said that does not apply to federal offenders and there is no warrant to move them up to 75 per cent, but there is warrant to have regard to a long line of pre‑existing common law guidance.
When your Honours look at it, Messrs Adsett and Pedley say, correctly – we say undoubtedly correctly – that the common law still has a role to play and it is not displaced by IB. So that one of the submissions we put is – and I should interpose that in one of the cases, I think it was either El Karhani or Ferrer-Esis, the Court of Criminal Appeal, and they were both very experienced benches, said that this broad proposition of two‑thirds applied across Australia. That was endorsed by Justice Hunt at the time and, as your Honours would know, if anyone knew what the common law was at that time across Australia, it was Justice Hunt. So your Honours would have confidence that those statements were correct.
GUMMOW J: But, how does section 68 pick up the common law?
MR NEIL: It does that your Honour in a ‑ ‑ ‑
GUMMOW J: It is the common law of Australia. There is no such thing as a common law of a State.
MR NEIL: Yes.
GUMMOW J: Now, how is that picked up by section 68 or does it otherwise enter into the picture?
MR NEIL: If I could refer perhaps to the Adsett and Pedley paper at page 7, a third of the way down Part B ‑ ‑ ‑
GUMMOW J: Just stopping you there for a minute. I gather from what you have just said it is not suggested that section 44 in 1989 New South Wales sentencing statute is picked up through section 68 of the Judiciary Act?
MR NEIL: No, it is not, your Honour. It suggests that that operates for New South Wales, but for federal offences it does not displace the common law. The authors say at page 7:
In general the Commonwealth sentencing regime, set out in Part 1B of the Crimes Act 1914 (C’th), does not provide any detailed guidance as to the length of the non‑parole period and there is no general Commonwealth statute that requires the non‑parole period to bear any proportion in relation to the head sentence. The common law provides that guidance.
FRENCH CJ: What do we mean by the common law here? I mean, we are dealing with the statutory function, entirely a statutory function.
MR NEIL: That is, I would respectfully respond, your Honour ‑ ‑ ‑
FRENCH CJ: We have the exposition about how the discretion is properly exercised from time to time and in that sense judicial exegesis of the relevant statutes.
MR NEIL: My response, and I hope it satisfies your Honour the Chief Justice ‑ ‑ ‑
GUMMOW J: You better be careful, because you are talking yourself into a constitutional point.
MR NEIL: I hope your Honour the Chief Justice’s question is simply answered by saying that because the statutory provisions do not and have never purported to cover the field there is a residual area of State and Territory law that still has application and part of it is the common law.
FRENCH CJ: But it is statute law, is it not?
GUMMOW J: It does not have application. It has application through section 68 of the Judiciary Act. It has no application of its own force.
MR NEIL: Correct, your Honour.
GUMMOW J: Unless we get that straight, we are just going off the rails.
MR NEIL: Your Honour, may I hope that I am straight now because I agree completely with your Honour, but in that context, nevertheless, if you take the operation of section 68(2) of the Judiciary Act, you look at Part IB, you look at the factors that Part IB does not cover and does not purport to cover, there are left residual aspects that fall to the States and Territories.
GUMMOW J: Of State statute law, of State and Territory law.
MR NEIL: Yes. I mean no more than that, but I mean they do have some role to play. The way they work in practice means that all that can be achieved is what Adsett and Pedley say has been achieved, reasonable consistency. You cannot have more than that. If I could just adopt with the utmost respect, something that came from a question to my learned friend from Justice Heydon. When one looks at the position of a first instance sentencing judge having to check the law in every State and Territory for every federal offence when they only comprise about three per cent of matters that go before the State and Territory courts, the rest being State and Territory offences, it becomes an extremely difficult task. It might be appropriate more so, and no doubt is, at the intermediate appellate court level.
In the case of De La Rosa, when your Honours see it, Justice McClellan, the Chief Judge at Common Law, in a drug case analysed about 100 different drug cases and came to the conclusion that there was no pattern. These were federal drug cases right through the country. It is not easy to get these kind of comparisons and one of our arguments is that the best assistance a sentencing court can get and, indeed, an intermediate appellate court can get, is a selection of those cases which are most relevant in terms of the particular offence and in terms of the various circumstances to the case under consideration. That was what was provided to her Honour Judge Morgan, and that was what was provided ‑ ‑ ‑
GUMMOW J: What was section 109 of the Constitution speaking about in De La Rosa? I do not understand it.
MR NEIL: Your Honour, I have had a very close look at De La Rosa on other aspects. I must confess to your Honour I did not look at - De La Rosa deals with a whole range of issues which I hope I am not in error ‑ ‑ ‑
GUMMOW J: They are all Commonwealth offences though, are they not?
MR NEIL: Yes, but they did not appear to be germane to the issues, at least to me. I may be at fault. They did not appear to me to be germane to the issues raised by these applications.
GUMMOW J: One is still left puzzled by what you give as the content of this notion of common law that is engaged in this application for special leave.
MR NEIL: May I then refer your Honour to page 8 of Adsett and Pedley where the learned authors seek to explain that in the middle paragraph, “The High Court has noted however that”, and it goes on:
In a series of cases the High Court has said that at common law the yardstick for fixing the time –
Your Honours see it there. Then they go to El Karhani.
HAYNE J: It seems to me that if there is any statutory route for this proposition, it is only source is in 16A(1). Section 16A(1) is cast in terms of generality. I forbear from saying whether it is helpful or not. You observe that 16A(1) applies not only to determining a sentence but also determining the order to be made. Relevantly, I would have thought that includes the recognisance release order.
MR NEIL: Indeed, your Honour.
HAYNE J: You look at Division 4, 19AB and following. You observe that 19AG(2) provides explicitly that there are cases in which there must be a 75 per cent relationship, otherwise Division 4 is silent. You are cast back, are you not, therefore to 16A(1) and the requirement of imposing a sentence or making an order of a severity appropriate in all the circumstances of the offence. Now, if the common law has a part to play, it might be understood as some explanation of the content to be given to the notion of severity appropriate in all the circumstances of the offence. Beyond that, presently it is not clear, to me at least, where the common law has any part to play in this.
MR NEIL: I do not put a contrary submission, your Honour Justice Hayne, on the first part. As to the second part, what we do submit is that because there was an existing common law guideline and because 16(1) does not address the question, it is not inappropriate to have regard to a guideline rather than, as my friends seek to characterise it, a New South Wales norm that is a rigid diktat. When one looks at Bernier and the way it is explained, as Justice Rothman himself, it makes it perfectly plain that there is adequate flexibility. It is a bit like looking at statistics of head sentences, with respect, your Honours, unless you try and find cases that are reasonably comparable, with respect, it is a waste of time, as I think one of the justices in Western Australia commented when in one case a 45‑page schedule was handed up and his Honour pointed out it is just too much detail even for an intermediate appellate court.
In this particular matter, Justice McClellan requested, at the close of the hearing, the Crown to provide not a list of comparable cases but a list of all fraud cases in Australia covering tax fraud, GST fraud, social security fraud, every kind of fraud. It was not the one my friend refers to that went up in Marshall and Fidler, I think it was, it was specially constructed. It was 55 pages. Their Honours did not refer to it. One of the reasons we surmise, and we do not know, is that there were hardly any cases on it, apart from the ones we put in our separate summary, that bore upon the issues that were before their Honours in relation to this type of criminality.
HAYNE J: The notion that you can derive a norm, guidance, whatever word you care to apply, by looking at a population of 439 cases – see Mr Pedley’s paper page 12 – over a period of three years, somehow treating those 439 federal offences as sufficiently similar to warrant drawing some comparison between them, though they range from the unemployment benefit fraud through to the importation of large commercial quantities of narcotics, what do you get out of it? You get proof that the person doing the calculation owns a calculator, I would have thought, and that is all you get.
MR NEIL: One would hope more, but your Honour may be right. We did not provide a 55‑page summary voluntarily to the Court of Criminal Appeal because we did not think it would be of assistance but perhaps, your Honour, we may get at least this much - if I could just burden your Honours with one more reference to this paper and it is the very last page, page 32, “Conclusion”. It is the last dot point and it emphases a point I made in terms of the distinction between Queensland and New South Wales.
Then one goes, if your Honours have looked at that, as quickly as I may to the document under the next tab, C, the very short paper of Ms Kukulies‑Smith, a lecturer in the Australian National University, who presented this paper at the same conference. Your Honours see on page 1 she notes what Chief Justice Spigelman said – identification of the problem. She goes on, page 2 at the bottom, “Nature of debate”. She identifies factors of the task of difficulties of federal sentencing.
I do not want to say other parts of this paper are not important, but I know your Honours will only want me to take time with the keys. In page 4, third‑last paragraph, she correctly states what fell from your Honours Justices Gummow and Hayne and Justice Gaudron in Wong. Then she says, relevantly, we submit, on page 5 under 3A after referring to the Crimes Legislation Amendment Act:
However, the earlier model of depending on State and Territory law was retained for a number of sentencing matters considered peripheral. Therefore, part IB of the Commonwealth Crimes Act is not a comprehensive scheme.
She goes on to say at the foot of page 7, “Conclusion” – is there reasonable, does it matter? She said “it depends”. Dot point 3 on page 8 is perhaps the most relevant but what she points out is that federal offenders throughout Australia are not all subject to the same laws and that explains some differences but, nevertheless, both she and Adsett and Pedley advocate – and I know it is only their research and it is not binding of course on your Honours but is of some interest – that reasonable consistency has been achieved, notwithstanding. We submit that is really one of the ultimate questions. I know it does not go to manifest excess or inadequacy.
Your Honours, perhaps I could more usefully move now to this critical question of was there manifest inadequacy, did the Court of Criminal Appeal have to identify specific error. Well, your Honours, the starting point is plainly not on a lot of authority of this Court, although there is a debate about that in De La Rosa that I will take your Honours to to identify it.
HEYDON J: Do you rely on what Justice Gummow read out this morning from Wong v The Queen, presumably, two categories, specific error of principle and, secondly, residual? It could be one or the other.
MR NEIL: Yes, correct, your Honour. I have that on the list. Your Honours, we have on our list – may I just merely give the paragraph references - Leeth v The Commonwealth (1992) 174 CLR 455 at the top of page 464, first paragraph. That was before IB came in and it is perhaps of a bit less relevance, but an important matter that Justice Fryberg identified from Leeth at page 466 in the joint reasons of Chief Justice Mason and Justices Dawson and McHugh in the second full paragraph about halfway through:
It is notorious that the application of different regimes to prisoners serving their sentences in the same prison, particularly in relation to the date of release, is productive of conflict and unrest and is inimical to good prison administration.
That was a specific reason why Justice Fryberg in Hargraves and Stoten departed from the dictum expression of Justice Rothman for New South Wales, because in New South Wales you are giving them, on one view, if he is right, broadly in the range of 60 to 66 per cent compared with 75 per cent. In Queensland you are doing that in relation to less than 50 per cent. A plain injustice, but nothing can be done because Queensland has not and apparently will not mandate 75 per cent minimum period for non‑parole. Then at page 468 in the last paragraph of their Honours’ reasons:
The Constitution plainly envisages the continuation of separate State legal systems . . . to invest any court of a State with federal jurisdiction . . . the Commonwealth must take the courts as it finds them, notwithstanding the differences that exist from State to State (27).
at the top of page 469.
BELL J: This was in the context of the Commonwealth having chosen to pick up the State and Territory provision for the setting of minimum terms. Now that the Commonwealth has chosen to have its own system, one can see some force to the view that it ought be applied uniformly, that is, the principles as to how one approaches the fixing of the minimum term under the uniform Commonwealth led scheme one would think ought be applied consistently throughout Australia.
MR NEIL: Your Honour Justice Bell, the Commonwealth Director has no problem with that whatever. He sought to achieve that in Wong and came unstuck, and he is still trying, but he has to recognise that there are these constitutional limitations that cannot be treated as irrelevant, that is, you cannot get complete uniformity. When I take your Honour to Justice Simpson’s reasons in De La Rosa, she makes the point, “Well, we must have reasonable consistency of federal offenders”, but consistent with what, because we can have inconsistent State laws for very similar criminality in New South Wales?
If we are going to make federal offenders consistent with Queensland, we are going to be clashing for equivalent criminals performing the same sort of criminal acts within the State of New South Wales, and she simply says – these are my submissions, not her Honours words – but the meaning appears to be, “I do not know what the answer is. It is a very difficult one and it needs a lot more thought. She raises the problem and says it is a real problem. It may have to be addressed in another matter.” We submit this is not the matter. There are too many other issues that come into it.
Could I just go back, your Honour Justice Gummow, to Putland 218 CLR 174, if I may, and the passage at page 218 in the joint reasons of your Honour and Justice Heydon in paragraph 25, last sentence:
Section 68 applies State and Territory laws to important aspects of criminal proceedings in relation to federal offences. If State and Territory laws were all necessarily the same, then there would be little point in having State and Territory legislatures.
Sorry to backtrack, if I may just go back for a moment to pages 470, 471 in the joint reasons of Chief Justice Mason and Justices Dawson and McHugh at the last paragraph:
Even if it is accepted for the purpose of argument that any fundamental departure by the legislature from the principle that like offenders should be treated in a like manner may involve the imposition upon a court of a non‑judicial function, it is in our view apparent that to require a court, in the case of a federal offender, to have regard to the sentencing practices of the State in which he is convicted involves no such departure.
Your Honour, that is really all I wanted to submit on that particular point. Might I try and make good my earlier submission that the previous common law before statutory intervention was that there was about a two‑third non‑parole period to head sentences. I would commence, if I may, please, your Honours, with the decision of the New South Wales Court of Criminal Appeal in El Karhani (1990) 21 NSWLR 370. Your Honours will see a strong bench of President Kirby as he then was, Justice Campbell as he then was now in the Court on Appeal, and Justice Newman.
BELL J: I think that might have been a different Justice Campbell.
MR NEIL: Your Honour is quite right, my apology. Justice Campbell will be very upset to think he was sitting this far back. Your Honour is quite right. But that Justice Campbell was, with the utmost respect, a highly respected and competent judge in the jurisdiction. Perhaps commencing at page 380 at E ‑ ‑ ‑
GUMMOW J What is all this designed to achieve?
MR NEIL: It is designed, your Honour, to try and persuade your Honours that all Justice Rothman was doing, in talking about, every time he used the word “a norm”, a general guide that was always subject to substantial qualifications and its application that originated from the common law and had been carried through a chain of authority by the New South Wales Court of Criminal Appeal.
FRENCH CJ: You keep talking about the common law, but it strikes me that what you are really talking about is judicial exposition about the exercise of statutory sentencing discretions. It would be like talking about the common law of section 52 of the Trade Practices Act because there has been a lot of development of what that means. We are really talking about transplanting, are we not, from one statutory area to another, approaches to the exercises of discretion? You might even be better off talking about that than talking about the common law.
MR NEIL: Upon reflection, your Honour, I probably would be and I apologise if I have used misdescriptions, but your Honour has encapsulated the distinction I am trying to draw, perhaps not very eloquently, but thank you, your Honour, for that assistance. Can I take your Honours to page 385 at B:
It is not inappropriate to take into account that throughout Australia the reduction of custodial sentences for remissions and the like is about one third of the sentence. Again, this is not a fixed ratio.
and so on, and particularly at page 386 at F:
As was noted by the High Court in Griffiths v The Queen (1989) 167 CLR 372 at 392 in the general run of non‑parole periods a ratio of approximately 60 per cent to the head sentence was not unusual under the former law. A ratio of 75 per cent. . . to the most serious of cases.
When Section IB came in, that was picked up and carried forward. That may be demonstrated, together with another point of significance, your Honours, in the case of Ferrer-Esis 55 A Crim R 231, again a very strong bench, Chief Justice Gleeson as he then was, Justice Lee the Chief Judge at Common Law and Justice Hunt. At 236, on another point but so as not to come back, at about point 5 in the paragraph commencing:
A Crown appeal against inadequacy will not as a general rule be allowed –
but particularly the sentence –
Such an error may be demonstrated by the sentence itself where it is not merely inadequate but manifestly so.
That is, if you cannot identify specific reasons, an intermediate appellate court is not prevented from intervening, but the converse is – as your Honours know, the Crown never criticised her Honour Judge Morgan in anything she did except impose the sentences. We cannot identify any error. If we had to, we could not possibly be here. But we submitted with force that the head sentence and the recognisance release periods were so aberrant compared to such reasonable comparable cases as we had, and there were a number – there was Wheatley, there were a few others – that bore right on this field with a lot of authority talking about the perniciousness of long-term schemes for hard to detect tax evasion.
Justice Rothman said out of 10 years an appropriate commencing point for these people who have committed offences over several tax years and taken in profit $360,000 in one case $380,000 in another was not the most serious type of criminal conduct of its kind but it was very serious, and he was right, and he started at 60 per cent of the maximum. Her Honour started at less than a third. We say that just is obviously wrong. Now, we are either right or wrong on that and I will not keep repeating it, but his Honour was entitled to take that view of it. If an intermediate appellate court cannot go that far, well, a lot of the work of the intermediate appellate court falls away, with the utmost respect. But further down, he spoke of a recognised pattern for couriers. I appreciate this was a drug case. Prior to IB:
of between 12 and 16 years, with minimum terms generally fixed within the order of approximately 60 to 75 per cent of the head sentence.
Over on the page he spoke of the effect of IB:
What difference there does appear to have been seems to me to have been a result mainly of the absence of the previous rigid 75 per cent rule in the ratio between the minimum term and the total sentence.
He was conscious of the principle in Griffiths and he said something we would submit is of importance for an intermediate appellate court, second last paragraph:
But this Court is nevertheless entitled, as is the general community entitled, to some explanation from a judge as to why he or she has concluded that the particular case warrants a departure from the accepted sentencing pattern –
and so on. Our argument in contradistinction to our learned friend’s is we did give her Honour assistance. We gave her all the cases. We gave her an accurate summary. She did not advert to them at all. True it is, technically, she did not have to advert to them. We do not say she has to quote them all in rote but the real complaint is she went completely against every one of them.
The Court of Criminal Appeal who had exactly the same material in the Court of Criminal Appeal book took it into account and when my learned friend takes your Honour to Justice Rothman and commences at about paragraph 30, as I hope to demonstrate, it cannot be read separate from what comes before about his Honour’s description of the objective criminality and so on. You must read his judgment as a whole and when you read his judgment as a whole, as a whole document it is entirely understandable and explicable.
BELL J: I think, Mr Crown, you have taken us to some New South Wales cases such as Ferrer‑Esis and El Karhani in order to make good a proposition that the Court has on occasions indicated by reference to historic material with respect to Commonwealth drug offenders the sort of length of non‑parole periods that were regularly applied.
MR NEIL: Yes.
BELL J: The difficulty I think might be when you come to paragraph 44 in his Honour’s reasons in the Court of Appeal - it is at appeal book 928 – when it is clear that he turns to special circumstances finding them as a reason to depart from the norm that he has earlier described. What one sees is a slide from any consideration of a pattern that provides some guidance with respect to the proportion as between the head sentence and the non‑parole period, which may be one approach to adopt, and the importation into the sentencing of a federal offender of a requirement that one does not find in the scheme of Part IB.
MR NEIL: It may depend a little on what his Honour meant. His Honour was frank enough to say in his supplementary judgment on the slip rule application that some of his expressions had been a little infelicitous. Nevertheless, we would submit, your Honour Justice Bell, the meaning is plain enough. If one looks at paragraph 37 on 923 where he says he agrees with Queensland, there has never been a need for “exceptional circumstances”, he does say, and we hope he is right, that there is a need for special circumstances but when one looks at what he means by them they are very ordinary. He makes that plain at the top of 924, “circumstances that take the individual out of the ordinary situation”. That is all it is. No more than that. In this case it was good prospects of rehabilitation and so on and so forth which we have put in our written outline for offenders of this kind are par for the course.
He knew he was dealing with offenders of this kind. But while I am there might I very quickly go back a little bit into his Honour’s reasons because my learned friend, if I understood him, submitted that you just could not figure out what his Honour had done or why. I am trying to persuade your Honours that that is not really the case. At 909 at the foot of the page it has the heading “Facts”. Page 910, paragraph 5, line 10 he describes the tax scheme and the problems of it, the complexity of it and then he summarises, for each of Mr Hili and Mr Jones, their criminality, of which there was no issue and if that is not serious in this context, it is hard to think of anything that is. He puts that very plainly. He does not summarise it. He quotes it and sets it out.
Then at paragraph 7 on 914 he gives them all the concessions that they should have. They did not devise the scheme and so on and so forth, they were led into it. But he pointed out that they were not large companies they ran and they had to use such a scheme to get away with it and then he says at the end of paragraph 7:
As a consequence . . . whilst not worst cases, requiring the maximum (or close to it), are very serious incidents of the kind with which the sections deal.
Now, we do not understand our learned colleagues take any issue with that and that is an important reason why his Honour plainly did not have to articulate beyond that to make it obvious that what we say was, in fact, the learned sentencing judge’s commencement point of three years in that context was manifestly inadequate and that six years was not unfair.
He did not start at nine years. He was somewhat critical of the Crown for conceding 50 per cent discount for plea and whatever, but we have not complained. Indeed, we submitted 40 to 50 per cent. We took the view wrongly that the level of assistance in plea was in the range of high to very high. The Court of Criminal Appeal assessed it as high 40 per cent, but they have got their 50 per cent. They are entitled to it.
But after that her Honour says “Well, I will start at three years and I will give you 50 per cent discount and then I will reduce that to 39 per cent for recognisance release period, but but for your plea and assistance I would have given you three years and I then would have given you 21 and a half months recognisance release period” - that is 60 per cent.
The reason why you should be getting a double count for plea and assistance when you have got the maximum and you have dropped from three years to six years and you then drop from 60 per cent for the minimum term to 39 per cent is the reason we put to the Court of Criminal Appeal and to your Honours. That is completely inexplicable, but it is explicable on the second basis in which an intermediate appellate court can interfere. You do not know why her Honour said that and we cannot divine it. I cannot guess at it and I have tried hard.
FRENCH CJ: What did his Honour mean, do you think, at paragraphs 41 and 42 – and this is a question I put earlier – when he spoke of the sentence imposed being:
out of the range of sentences that could have imposed –
and secondly, far outside of the range of sentences available? What is being referred to there?
MR NEIL: Your Honour, our submission is that he meant that in the context of what I have taken your Honour to and what he said about revenue offences generally from 916 on because he goes through them in detail. He cites a passage from L. Vogel about how serious they are, how difficult they are to protect, the cost to the community - paragraph 15, “serious offence”, “significant penalty”, so on and so forth.
FRENCH CJ: Are these statements anything other than tautologous, in other words another way of saying it is manifestly inadequate?
MR NEIL: They are sufficient articulation by an intermediate appellate court of reasons for concluding the sentence below was manifestly inadequate. As authorities of this Court have said, and I hope to take your Honour to them, an intermediate appellate court does not have to say much. There is one case where they did not even use the expression “manifest inadequacy”, but this Court was prepared to conclude that that is what they must have meant. It cannot mean anything else, your Honour Justice French, in our respectful submission. It fits with the tests that have guided intermediate appellate courts coming from this Court.
FRENCH CJ: It is not a reference to a pattern of sentencing or anything of that kind. It is just a statement that this is, on general considerations, manifestly inadequate.
MR NEIL: That is so, and one reason that may be – I mean their Honours requested, as you know, the schedule. That was provided. Our view was that very few cases in the schedule would be of any assistance because they are so different from this situation. Three or four cases were. They already had them in detail, and the cases, and so on.
FRENCH CJ: You do not seek to support this decision on the basis of the schedule.
MR NEIL: No, your Honour, I do not. We say that is where it comes from. Can I put a submission as to what we submit his Honour was talking about in terms of the “norm”, because he uses inverted commas. Firstly, at 921 in paragraph 31, he addresses the ratio of non‑parole period to head sentence. In paragraph 31, as my learned friend Mr Svehla pointed out, he identifies the contest between the parties. Then he addresses it. He addresses the New South Wales statutory regime for State offences. He deals with the guideline, as he calls it there – and that is not a norm – in Bernier, and he says at 34:
Statements of this kind, and to this effect, are of long‑standing . . . circumstances that are special to a particular individual –
I will not read it out, your Honours see that. He is making it perfectly clear that it is no more than Bernier ever said, merely a guideline, not a prescription that you cannot depart from. Then we had put to him certain cases from Queensland, CAK & CAL. It was disapproved in Ruha, in terms of its approach, primarily because they have no statutory minimum for local sentences, but no one questioned the ultimate sentences that CAK & CAL actually imposed. The appeals were allowed, and the sentences were increased.
I will not take your Honour all through that, your Honours have seen it, but he then goes to what that court had said about Tran and cites relevant passages from it. He then goes to Robertson and points out that was not drawn to attention and he says at the bottom of page 923:
The principles, embodied in the line of judgments in this State on this issue, have never required extraordinary or exceptional circumstances in order to depart from the “norm”.
We have submitted, as a reasonable inference, he picked up the word “norm” from page 923 out of Tran, it would appear, at paragraph [18]:
The norm for non-parole periods and periods required to be served before a recognizance release order for Commonwealth offences is generally considered to be –
in the range of 66 per cent, but he does not say “I am adopting the norm”. He is using it as a description and puts it in quotes. Thereafter, he always uses quotes.
He then discusses Ruha in great detail. True, he does not cite paragraph [53] of Ruha but your Honours would infer he looked at it. I mean, he could not put the whole lot in. It would be just too prolix. We have submitted in the written outline that if you look at page 926, volume 3, at the end of that quote just below line 40 where they correctly summarise what came from the New South Wales Court of Criminal Appeal in Bernier then Viana and so on, if you look at what the Queensland court said at [53] in Ruha you can see that there is no great difference in approach. There is a difference in emphasis. Justice Rothman, in our submission, accurately summarises the effect of Ruha at paragraph 39, line 50 on page 926 that:
the “norm” for a period of mandatory imprisonment under the Commonwealth legislation is between 60 and 66%, which figure will be affected by special circumstances applicable to a particular offender. On any analysis, there is no basis upon which this Court ought to depart from its approach to non‑parole periods.
Our submission, as your Honours may have noticed in the written outline, is that if you have a look at Farah Constructions and if you have a look at what the New South Wales Court of Appeal said in Gett v Tabet just as Justice Fryberg said he was bound by what the Queensland Court of Appeal said in Ruha, Justice Rothman felt bound by what was said in the Bernier line and thereafter which, as we submit, no one has found and Justice Fryberg distinctly held back from saying that Justice Rothman’s dictum was plainly wrong. No one has found that it is plainly wrong or anything of that sort. It is just a difference in wording, in our respectful submission.
HAYNE J: Apropos of that submission, can I take you again to Wong at 207 CLR 584, particular at 605 and following under the heading “Results and reasons” which I think can be read as perhaps culminating in what is said in paragraph 59. Do you seek to say that anything said there should be qualified or departed from?
MR NEIL: Would your Honour forgive me. I am just a fraction slow and I just have not picked that up, but I have it.
HAYNE J: I thought you had it, forgive me.
MR NEIL: I have it here, your Honour. Could I just have the paragraph reference?
HAYNE J: Yes, page 605, paragraphs 57 and following, particularly 59. Can I just, while you are looking at that, point out to you that it is taken up in different language, but I think not to any relevantly different effect by Justice Simpson in that case of De La Rosa [2010] NSWCCA 194, particularly at paragraphs 303 to 305, in terms which I would think are not relevantly different. Do you say that what is said in either of those cases requires reconsideration, qualification or departure?
MR NEIL: No, your Honour. We say, your Honour, that it is also picked up in Carroll v The Queen 83 ALJR 579, which we have on our list, a decision of this Court comprising your Honours Justices Gummow, Hayne, Crennan, Kiefel and Bell at page 581 in paragraphs [8] and [9] drawing the specific distinction between specific error and the kind of ground 3 basis of appeal in House v The King of manifest excessiveness or manifest error not requiring any special identification of error or special reasons.
Your Honours did say it has to be on its face, that is the sentence unreasonable or plainly unjust. The Court of Criminal Appeal was in no doubt – my friend says, well, they must have it got wrong because they went up 100 per cent, but the converse of that is that the learned sentencing judge was just so far out that the head sentence and mandatory terms were manifestly inadequate. Can I just, if I may, conclude on this ground of appeal by submitting that Justice Rothman at paragraph 40 at volume 3, page 927 – you have heard my learned friend’s submission that he says whatever norm is utilised means that the norm must be utilised.
With respect, we are submitting that his Honour does not mean it that way, if that is to be taken as some prescription that cannot be departed from. He is just identifying different approaches and the fact that there are different approaches in Queensland, Western Australia and New South Wales, they are dictated very largely by different State mechanisms. That comes back to the constitutional point which I am not going to refer to again unless I am asked a specific question. He is just using language to identify what the task of the sentencing court is and there is no criticism, as we just understand it, from our learned colleagues of how his Honour expresses what the task is.
When you go to conclusion at 41, we say that everything his Honour said there in 41 in terms of principle is well established and that is one reason, we submit, that we these matters do not warrant the grant of special leave. We submit if they do, then the appeal should be dismissed because it is perfectly plain that it was the function of the Court of Criminal Appeal to expressly address that question. They did so with care and we put to them, make no bones about it, that these were the first relevant Wickenby matters. My friend has said there is a whole chain of them coming through.
It was very important from the point of view of the DPP in the interest of the community to establish whether or not such low sentences were manifestly inadequate for people going into international tax schemes ripping off several hundred thousands dollars or four and five year periods through a series, when one reads the material that Justice Rothman identified, of signing countless false tax returns, bodgie loan documents, bodgie invoices for consulting services never provided, individually.
I mean, the Crown accepted rolled up pleas, we do not resile from that, maximum 10 years, but individually within that, the criminal matrix was hundreds of intentional, highly dishonest acts for years, and that brings seven months? Your Honours, with the utmost respect, that was manifestly inadequate in anyone’s language, and especially in the language of the community. So those are the submission we put, may it please the Court, on that particular aspect.
My friend took your Honours, and I only want to go very briefly, to the slip rule judgment at, if your Honours have that, paragraph 60 on page 18 where we, as your Honour, I think, Justice Gummow and Justice Heydon did, pointed out his Honour’s correction of the wording and just as his Honour did in the primary reasons here he made the point that it was not justified to go lower than 50 per cent. My friend correctly identified the Crown appeal on this. It was that the head sentence was manifestly inadequate, the mandatory imprisonment period was manifestly inadequate, but the fallback position was, if it was found by the Court of Criminal Appeal that the head sentence was manifestly inadequate, that 39 per cent for the minimum term definitely was where her Honour would have applied 60 per cent if she had not given that discount and that there, in effect, was a double discount, not a double count, a double discount of five months.
In one of the Queensland cases – I just cannot recall, I can get it for your Honours, but I think it was the tax offender. I am sorry your Honour, I think it was CAK and CAL – where the court had applied a minimum term of four months, the Appeal Court thought that was so aberrant, it increased it to nine months without interfering with head sentence. I mean, seven per cent for this kind of criminality – I am not going to repeat myself, your Honours – the point is either a good one or it is not.
Your Honours, may I just draw attention, for convenience and to save time, to volume 3 at page 762, which is part of the Crown’s written submissions to the Court of Criminal Appeal commencing at 752, but under the heading, “The argument, The head sentences”, and we went on from there. We drew the comparisons and the distinctions between Wheatley and we submitted that that was the most relevant comparable case. Now, if one is looking for comity between States, one would rhetorically ask, why would a New South Wales sentencing judge depart from an equivalent level judge of the County Court of Victoria in a case like Wheatley where there was a reasonably close parallel? We put in to the supplementary materials –and I would like to just identify this, if your Honours would excuse me very briefly – when Mr Richter and Mr Wheatley went before the Victorian Court of Appeal, they withdrew the appeal.
KIEFEL J: This is by way of showing that there was some possibility that the sentence might have been increased.
MR NEIL: It was a very, very strong hint, your Honour, a very strong hint. Now, we are not relying on that other than to say that Wheatley at first instance seems to be the minimum ‑ ‑ ‑
KIEFEL J: You say it underscores the sentence in Wheatley.
MR NEIL: Yes.
KIEFEL J: But you are not taking it any further than that?
MR NEIL: No further than that, but there was a recognition, ultimately, by Mr Wheatley, and that appears in our supplementary materials at tab G. No, I am sorry that is the reasons on sentence. It is tab E, my apology. On 7 November, the Justice of Appeal Chernov, on the second page under the heading, gave a pretty plain indication and that was repeated on 29 November 2007 before a Full Bench of Justices Chernov, Vincent and Neave at the second page, line 6. Justice Chernov made those remarks and your Honours see that the matter was withdrawn. We say, look, that does not mean the sentence should have gone up, but it should not have been any lower.
Could I then perhaps conclude by identifying for your Honours some passages from De La Rosa [2010] NSWCCA 194 where the Full Bench arrived at the same result for a variety of different reasons; the decision of President Allsop, Justice of Appeal Basten, Justice McClellan Chief Judge at Common Law, Justice Simpson and Acting Justice Barr. In the reasons of Justice Allsop commencing at paragraph 58, the first sentence:
The only ground of appeal was that the sentence was manifestly inadequate.
Now, his Honour then sets out principles that we have canvassed and there seems to be no controversy about. We have in our list Allpass, Lowndes, Everett, Clarke and so on, but there does not seem to be any need to go further. His Honour has, one would expect, given an accurate summary of them. Could I take your Honours to paragraph 61, the quotation from the reasons of Chief Justice Gleeson, as he then was, and Justice Hayne in Dinsdale at paragraph [6]. I think we may have gone to this. We say that is the test.
Justice Basten took a completely different approach, but this was on the question of whether it was proper for the court to undertake its own research or not and there was a debate really between him and Justice Simpson. As Justice McClellan undertook the research, we may assume he supported the idea. Justice Barr said nothing on it and, from what I read, Justice Allsop appears to have said nothing on it.
BELL J: You speak of the court conducting its own research. The parties were invited to comment on it.
MR NEIL: They were, indeed, your Honour, and that is recorded. Justice Basten makes the point that this can be an imposition on parties. I do not think he was referring to the Commonwealth, but particularly legally aided appellants or respondents who do not have the wherewithal to do the research. Your Honours, I should draw attention in fairness to what Justice Basten said at paragraph 75 in the quoted words after correctly quoting House v The King and the passage from Dinsdale:
Unless error is stated and demonstrated, the appellate court has no legal authority to substitute a sentence which by law belongs to the primary judge. Adhering to strictness in this matter is also a protection –
He does go on to say at 76:
Consistently with these principles, where no specific error is identified, the prosecuting authority must establish to the satisfaction of this Court that the sentence imposed of itself demonstrates an erroneous application of proper sentencing principles. It must also be clear from the reasons given by this Court as to why that is so.
We say that is not inconsistent with what Justice Rothman said in his description of why these sentences were manifestly inadequate, given that that that is a separate and distinct basis for finding a sentence manifestly excessive or inadequate. The other justices do not so express themselves. Then we have Justice McClellan. If your Honours will forgive me, I will not recount his very long summary of drug cases. It is not going to assist your Honours. It did not seem to assist, with the utmost respect, his Honour or Justice Simpson, but I am not at all, I hope, being flippant about the conduct of the exercise. It was an extremely important exercise and it may have thrown great light on it. But he did say, that is Justice McClellan, at paragraph 126, in the middle:
The Court must be satisfied of manifest inadequacy, having regard to comparable sentences from other parts of the country, if available.
We say that is our case when we point to cases like Wheatley and Gregory from Victoria and CAK and CAL from Queensland and the decision in Ruha itself. I am sorry, your Honour, I am still with Justice Basten. Justice McClellan commenced at paragraph 148, my apology for that. Then if I could jump to what Justice Simpson said, commencing at paragraph 272. I will just point out from paragraphs 283 to 287 her Honour took a different position from Justice Basten about the question of research and Justice Barr on the next page really added little. It was unnecessary for his Honour ‑ ‑ ‑
GUMMOW J: Was there any division in the court in this case, De La Rosa?
MR NEIL: Well, not as to the ultimate result, that the Crown appeal on manifest inadequacy fail, they were unanimous, but, as Justice Basten said, “We have reached that result by different paths.” Your Honours, I hope I have not gone over this, I do not believe I have. I meant to just remind your Honours, and it is in Ms Kukulies-Smith’s paper at annexure C to the supplementary material, that she points out different federal offenders in different parts of Australia are not all sentenced according to the same laws for the reasons that she gives.
BELL J: Is that to do with the question of the commencement of sentences and those jurisdictions in which one can backdate and those in which one cannot? Is that the point?
MR NEIL: Well, partly. It is because, as she says at the foot of page 6, there is a:
blended sentencing regime means that inconsistency in sentencing federal offenders is possible because the regime itself accepts and adopts diversity. In fact, to ensure reasonable consistency in these aspects of federal sentencing, Courts will need to be incredibly informed about the sentencing law and practice imposed elsewhere in Australia and respond accordingly.
She had earlier said that this had been considered by the Australian Law Reform Commission which had adopted as a model consistency so far as possible in federal sentencing, but pointed out that because federal offenders are only three per cent of sentences and the Federal Government apparently had taken the view that it was not economic to set up a federal criminal court, that one could only do the best with the arrangements that had been made.
BELL J: But just in terms of that distinction between jurisdictions relating to the commencement of sentences and with that the capacity to backdate sentences, provided a court looking at the sentences imposed in another jurisdiction is aware of those differences, one would expect presumably that in a jurisdiction in which sentences are not backdated one would understand the sentence imposed in contrast to one where backdating has taken place on an analysis. It is merely that when the information is presented statistically it can be misleading, because ‑ ‑ ‑
MR NEIL: Correct, your Honour.
BELL J: Yes, that is the real concern. It is the presentation of statistics when you have those sorts of differences that may be problematic, is that right?
MR NEIL: Yes, it is, and I think Justice Simpson made the point that these charts of statistics tell us nothing about really the subjective circumstances of the particular offence or even sometimes the objective circumstances and can be misleading and that there is a limit to the utility that one can put them to.
Your Honours, in the supplementary materials at annexure D there is a document titled “Comparative Sentences”. It has a “B” at the top. That was provided to her Honour Judge Morgan with the cases and it was also provided to the Court of Criminal Appeal with the cases. Due to an omission it was omitted from the actual joint application book in this matter before your Honours, but it was before the lower courts. May I just draw attention to a significant typographical error on the second page. This is about Wheatley, under “General” where it reads about six lines down from “General”:
Offending borne out of greed, rather out of need.
That was “Offending not borne out of greed, rather out of need”, and that is plain from the decision in Wheatley which is reproduced under the second group of supplementary materials under tab G. Mr Wheatley had gone bankrupt over a promotion that had gone wrong and owed $150,000 that he could not pay. These two offenders were people who were financially very comfortable and the finding of her Honour Judge Morgan was that they had acted out of pure greed.
We also have references to CAK and CAL and Robertson and what have. Your Honours will not want me to regurgitate that, but we put those forward because the view was taken that these would be of the most assistance to the sentencing judge and, indeed, to the Court of Criminal Appeal, and with the utmost respect, we adhere to that position.
We have put the cases that are available immediately below commencing with Wheatley and then going to Gregory, Thompson and O’Rourke, including those where other Wickenby people have subsequently come up and, at a maximum, been given a 50 per cent mandatory term of
imprisonment, and we just simply say that none of the very experienced District Court judges, who all have had before them the CCA decision under consideration, have read what fell from that Court per Justice Rothman in the way that our learned friends urged upon your Honours as being an absolute mandate that they cannot depart from. It has not had the effect that our friends feared. Unless there are other matters with which I may assist, your Honour, they would be the respondent’s submissions.
FRENCH CJ: Thank you, Mr Neil. Yes, Mr Svehla.
MR SVEHLA: Your Honours, the two compelling points that you should take out of the Adsett material at annexure B to the respondent’s supplementary materials is that the schedules of sentences analysed are all for more than three years, being non‑parole periods rather than release to recognisance periods of three years or under, which is applicable to the applicants in this case, so they do not give you any relevant assistance in that regard.
The second thing you should take is this. If one goes to page 15 of that, for the “more than three years”, New South Wales is well over 50 per cent of those sentences and the conformity of the overall Australian pattern is very much in line with the New South Wales position. So insofar as one can glean anything out of that, it should create concern about the impact of the norm or guideline that has been operating in New South Wales, at least for non‑parole periods of more than three years, over a number of years, on the sentencing pattern in Australia.
If you then go through the individual patterns, you will see discrete variances across Australia for other ones. For example, if one goes to Queensland at page 18, your Honour will see a very different type of graph. So it highlights the significance of the matter before you. It does not give you any direct assistance for the purposes of the three year or less pre‑release period, but it does have some significant matters to raise, and does tend to indicate that there has been this normative approach in New South Wales for some considerable period of time.
Secondly, insofar as cases at courts in other States over time since introduction of Part IB have been having regard to New South Wales cases, it is a very difficult matter to bring to account. But insofar as they have had regard to those cases, they may have been influenced by that sentencing pattern in their own sentences impermissibly. That itself is a matter of real concern. They are the only things one needs to take ‑ ‑ ‑
FRENCH CJ: Mr Svehla, I suppose there is a sense - sometimes we get to the non‑release period, “tail is wagging the head sentence” dog. We have here a head sentence which is, one could say, broadly speaking, low, relative to the maximum that is available. We have a judgment by an intermediate Court of Appeal that says it is manifestly inadequate. One question in relation to special leave is, is there any basis upon which we can say that that judgment is informed by a wrong principle which would warrant the grant of special leave? That is just as to the head sentence. If the head sentence remains intact, then of course, there is a whole issue about relativities with respect to the non-release period. In this case, they fixed 50 per cent. You would say, presumably, that that 50 per cent was informed by what you call the norm.
MR SVEHLA: Yes. I have already addressed that.
FRENCH CJ: That does not address the problem of the head sentence.
MR SVEHLA: No, the statement in 41 or 42 of their Honours’ reasons that it is so far outside the range takes you nowhere because if something is manifestly inadequate that is in essence what one is saying. It is just another way of saying the same thing. There is no information of reasons to assist in relation to that which is a fundamental requirement of what the Court of Criminal Appeal had to do.
FRENCH CJ: Is that not what we should respect as a judgment which is peculiarly within the province of the – not immune, of course, but peculiarly within the province of a Court of Criminal Appeal reviewing sentence? Whether you call it “intuitive” or “visceral” to ‑ ‑ ‑
MR SVEHLA: Yes, I understand. Your Honour, we say, no, because there is nothing to inform you of how they got there. If there had been something, yes, but you cannot just say that without anything, which is all that is said. It is a serious offence, yes, 10 years is the maximum, and they have just come up with that statement.
FRENCH CJ: They are saying of the sentencing judge “We do not know how she got there, but she was wrong”.
MR SVEHLA: Yes, and they have not given any proper analysis to what she actually did because as I said earlier in my in‑chief submissions, your Honour, so far as one tries some notional starting point, it was more than three years. It was four or five years, we do not know, but it was definitely more than that.
Secondly, your Honours, it is difficult for me to take it beyond that, your Honour, because there are just no reasons to grapple with in relation to that. In relation to when one is dealing with the federal sentencing, this Court, where there are no substantive reasons given, should not be allowing the intermediate appellate court to deal with a sentencing matter on that basis that increases the head sentence by 100 per cent and where you have the issues of consistency amongst the States and Territories in the Commonwealth.
I think my friend quoted you a passage, it was either from Justice Basten or Justice Simpson in De La Rosa where their Honours indicated that you are meant to explain how you have arrived at why it is manifestly inadequate; you are meant to state that, and that is what their Honours have said, and that is what their Honours did in De La Rosa, to a greater or lesser degree.
In relation to the second issue of the norm aspect, if I can just ask your Honours, when you do consider the matter further, to have a look at paragraphs 60 to 62 of the supplementary judgment and the supplementary appeal book at pages 24 to 25 where their Honours and, I think, Justice Rothman – this is a result of a slip rule application. It is in a small book like this, your Honours. The reason it is like that is that that judgment only came out recently. It is at page 24 and here Justice Rothman was dealing with the slip issue.
Your Honours need to have open at the same time the appeal book at page 928 where the original reasons are, because the point that was made as part of our original special leave grounds was that, when you read the original paragraph, it had a difficulty about it because it was not interfering with the proportion when her Honour’s proportion was 39 per cent. So the Crown made a slip application which has resulted in the amended paragraph which is set out in paragraph 60 of the supplementary reasons and when you read that, it is very clear from the amended wording:
I would not interfere with her Honour’s approach to fixing a lower than usual proportion in terms of mandatory imprisonment –
It is quite clear that the normative language in the primary reasons are applying and that the norm, as we put it, is being applied to the applicants in determining what should be the pre‑release period in relation to whether it was manifestly inadequate. So you have imported into the issue of manifest inadequacy an incorrect legal principle in its application. The only other thing that I wish to raise in respect of those reasons, your Honours, is the first issue in respect of which the slip rule is brought forward. It was in relation to paragraph 3 of the original reasons which are set out at paragraph 50 on page 22 where there is the statement that:
They paid out on false invoices, thereby avoiding GST and income tax –
Now, when you read paragraphs 51 to 55, which is the explanation of what his Honour meant, with respect to his Honour, it even makes the matters worse and the problem is, your Honours, there was no issue of avoiding GST because the fraud in this case is the creation of false invoices to enable the appearance of a service which enabled the company to write in its books a deductible expense and to put that in its tax return as a deduction when in fact no service was provided. There never was a GST issue. There could never be a legitimate service provided because the whole scheme and fraud meant there never was anything.
BELL J: Accepting that, where does this get you?
MR SVEHLA: It simply is, your Honour, in terms of ascertaining when one comes back to them saying it is so far out of the range, it is a bit unclear as to precisely what cases they were looking at in making that determination.
BELL J: Mr Svehla, it might be that what was being looked at was a fraud on the revenue of a sophisticated character.
MR SVEHLA: Yes, your Honour. I cannot say more than that in relation to that matter, your Honour. If I can give your Honours the references. I referred in my earlier submissions that this Court has the power to make the orders sought by the applicants, namely, to reinstate the judgment of Judge Morgan, and that is dealt with in the decision of Dinsdale at paragraph 25, page 330, by Justices Gaudron and Gummow and by Justice Kirby at paragraph 90 and also at paragraphs 72 and 73 where the earlier decision of this Court in Lowndes v The Queen was referred to.
I know it is an exorbitant jurisdiction for this Court to exercise but it is available to this Court to do. In the Dinsdale Case their Honours, having found relevant error by the Western Australian Court of Criminal Appeal, allowed the appeal, did not send it back to the Court of Criminal Appeal in Western Australia but reinstated the primary judge’s sentence. In this case your Honours obviously have to face the issue, from the perspective of my clients, if my clients obtain special leave and the appeal is allowed, the utility of referring it back to the Court of Criminal Appeal. On the Judge Morgan sentence they should have been out on 12 June.
HEYDON J: If the appeal were allowed, why would we refer it back to the Court of Criminal Appeal?
MR SVEHLA: Why would you not?
HEYDON J: If the appeal were allowed, why would one refer it back to the Court of Criminal Appeal? The Court of Criminal Appeal would simply have erred. Its orders would be set aside and Judge Morgan’s orders would spring up. What is the problem? What is worrying you? What is the phantom?
MR SVEHLA: It depends. If it is sent back for the basis of resentence ‑ ‑ ‑
HEYDON J: It is not going to be sent back, if you ‑ ‑ ‑
MR SVEHLA: Yes, I understand the issue, your Honour. I need say no more, your Honour, in relation to that.
HEYDON J: At least, I speak only for myself.
MR SVEHLA: If I can then just lastly, insofar as there are sentences referred to, your Honours, in our reply submissions, we have picked out some in our annexure A, and if I could just briefly take you to some in annexure A. The issue is, your Honours, that you do find within the taxation area some cases where very serious offences have been given low pre‑release periods. If you can go to our annexure A and without in any way seeking to deal with this, but if you go to page 5 of our annexure A which has the case of Wall, it is a Queensland Court of Appeal case which is a taxation case undervaluing the stock by $1.2 million over a number of years, the head sentence of three years with a pre‑release period of six months, 16.6 per cent is the ratio.
If you go to number 6, Regina v Gay, which is a 29D case, the shortfall amounts are not as large as those in our case but the pre‑release period is reduced from 12 months to 6.5 months, a ratio of 18 per cent. If you go to the decision on page 8 of Clark, which is a postal fraud case, the recognisance release period is eight months. If you go to number 9 on page 9 which dealt with officers in the Taxation Department engaged in over five years in a very detailed systematic fraud where they use the tax file numbers of people who have left Australia and caused refund cheques to be issued into accounts where their accomplices who had bank accounts, went over seven years and these were officers – we are talking about a total amount of about $1.2 million, different people of different amounts, you have pre‑release periods ranging from three months up to 18 months with ratios all – the highest ratio there is 42 per cent.
There are others in that. We then have the case - it is in my friend’s submissions - which is a recent case of May this year in Western Australia where a chartered accountant was involved in implementing a tax scheme that involved some $27 million and received 13 months as the pre‑release period on a head sentence of somewhat over three years and that is referred to in our submissions in reply. So what one is asking is well what are the relevant cases one is to look at here to make the finding that it was so manifestly inadequate?
My friend refers to some cases that have higher pre‑release periods and higher head sentences. But when you look at what is out there in the Commonwealth it is not all one way, your Honour. So there was an available basis for Judge Morgan to make the findings she did and to give the appropriate discounts that she gave at the head sentence, and at the pre‑release period for these particular offenders for the reasons I have previously explained in‑chief. So unless there was a careful analysis of this range of cases by their Honours you just cannot simply stand there and say, well, yes, it is all manifestly intuitive, it is so far outside the range. There had to be more than that.
The only other matter I wanted to ask your Honours to look at is the paragraphs in Ruha which talk about the way in which one considers determining the pre‑release period. This is specifically seeking to - if your Honours have the decision in Ruha [2010] QCA 10. If I can go to paragraph [45] in the joint judgment of Justice Keane, as he then was, with Justice Fraser. This has been picked up in other cases and in [45]:
Sections 16A(1) and (2) make it plain that all of the circumstances, including the matters in the non‑inclusive list in s 16A(2), must be taken into account in making recognizance release orders just as they must be taken into account in imposing a sentence of imprisonment. In particular, it is relevant to note in these appeals that the necessary deterrent and punitive effects of sentences for serious tax fraud must be reflected both in the head sentence and also in any provision for earlier release from custody.
[46]But it does not follow that the same weight should be afforded to each matter in imposing the sentence of imprisonment and in making a recognizance release order. The differences between the function of the sentence of imprisonment and that of a recognizance release order must be taken into account in assigning weight to the relevant factors. Making due allowances for the relatively slight differences identified above between non‑parole periods for sentences longer than three years but less than ten years on the one hand, and release on recognizance for such sentences or for sentences of three years or less on the other hand, the principles applicable in the former case are also generally applicable to recognizance release orders.
That was summarised by Justice Buss, with extensive reference to authority in Bertilone and in those paragraphs in Bertilone, Justice Buss referred to Power, Bugmy, Deakin, Griffiths, et cetera. Those authorities say that one looks at all of the circumstances in determining the pre‑release period and all of the circumstances include all of those indicia in 16A(2).
So one cannot have some normative a priori matter that one brings to account in undertaking this exercise, but one does have guideline statements such as that in the last sentence in paragraph [45], the deterrence principle for tax fraud and other such matters, but at the end of the day one looks at the particular circumstances of the particular offender:
provisions for early release confer a benefit upon the offender, but such provisions are made in the interests of the community; the non‑parole period is the minimum period of imprisonment that justice requires the offender to serve . . .
[47]Accordingly, and because the relevant factors and the relative differences in the weight to be afforded to each factor in the different aspects of the overall sentencing process may differ according to infinitely variable circumstances, there can e no “mechanistic or formulaic” approach which requires sentencing judges to ensure that the proportion which the pre‑release period bears to the sentence of imprisonment must or must usually fall within a range which is substantially narrower than the whole period of the imprisonment, which is the range the statute expressly contemplates for recognizance release orders. The proportions commonly encountered in the decided cases should themselves –
not “are”; the word is “should” ‑ ‑ ‑
GUMMOW J: Paragraph [50] is rather important too for you, is it not?
MR SVEHLA: Yes, your Honour. We have the norm here:
Part 1B of the Crimes Act, under which sentencing judges are given a discretion to direct release on recognizance at any time from the commencement to the end of the term, is consistent with the application of the general principle that material differences between particular cases might justify materially different sentences, including in the specification of the pre-release period; yet the very limited range proposed by the appellant as a sentencing “norm” (only about six percentage points . . . would confine the sentencing discretion within such narrow limits as to suggest that cases which are substantially different one from the other might attract materially indistinguishable recognizance release orders.
Their Honours then say for a three‑year sentence that gives you a two‑month range for the usual or ordinary case, which is in New South Wales.
KIEFEL J: Forgive me, I might be missing this, but what is the issue that you are dealing with by way of reply?
MR SVEHLA: I am seeking to address a matter Justice Bell put to me as to whether there is some proportion or principle that should be put forward in determining the pre‑release period for the purposes of the sentence and then, your Honour, it is also dealing with this issue of how does one determine whether a pre‑release period relating to a particular offender where all of the matters are addressed by the sentencing judge is manifestly inadequate. What is one doing in that particular case? There must be some explication of what is occurring. Unless I can assist your Honours further, those are the submissions for the applicant.
FRENCH CJ: Yes, thank you, Mr Svehla. The Court will adjourn briefly to consider what course it should take on this matter.
AT 3.52 PM SHORT ADJOURNMENT
UPON RESUMING AT 4.01 PM:
FRENCH CJ: The Court will reserve its decision. The Court adjourns until 10.15 tomorrow morning.
AT 4.01 PM THE MATTER WAS ADJOURNED
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