Huynh v Commonwealth Services Delivery Agency

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SUPREME COURT OF SOUTH AUSTRALIA

(Magistrates Appeals: Criminal)

HUYNH v COMMONWEALTH SERVICES DELIVERY AGENCY

[2014] SASC 143

Judgment of The Honourable Justice Peek

25 September 2014

CRIMINAL LAW - PARTICULAR OFFENCES - OFFENCES AGAINST THE GOVERNMENT - DEFRAUDING THE COMMONWEALTH

CRIMINAL LAW - PROCEDURE - INFORMATION, INDICTMENT OR PRESENTMENT - AVERMENTS - UNCERTAINTY, DUPLICITY AND AMBIGUITY

CRIMINAL LAW - PROCEDURE - INFORMATION, INDICTMENT OR PRESENTMENT - JOINDER - OF COUNTS

MAGISTRATES - APPEAL AND REVIEW - SOUTH AUSTRALIA - APPEAL TO SUPREME COURT

Appeal against conviction and sentence for offences against s 135.2, Criminal Code (Cwth).

The appellant was charged with seven offences of “obtain a financial advantage” contrary to s 135.2, Criminal Code (Cwth). It was alleged that he obtained payment of $15,756.98 in Centrelink benefits to which he was not entitled (because of his income from work) as a result of making false statements to Centrelink that he was not working or receiving income over a four-year period. The appellant was found guilty on all counts by a Magistrate and sentenced to 12 months imprisonment to be released after two months upon entering into a recognisance to be of good behaviour for 15 months. He appealed against conviction and sentence. As at the date of trial, and the appeal, $7400 had been “repaid” by way of Centrelink automatically withholding subsequent fortnightly pension payments, and the balance remained outstanding.

Held per Peek J (dismissing the appeal):

1. The language “obtain a financial advantage” used in s 135.2 of the Code creates an offence the subject matter of which encompasses ongoing conduct that gives rise to the payment of multiple payments or benefits. The counts were not duplicitous and did not each charge the appellant with the commission of more than one offence: Walsh v Tattersall (1996) 188 CLR 77; R v Taylor (1997) 6 Tas R 310 distinguished.

2.  The evidence of previous overpayments to the appellant by Centrelink was admissible in relation to all counts, and the evidence in relation to counts 1 and 2 was cross-admissible in relation to counts 3 to 7 and vice versa. 

3. The probative value of the evidence of overpayments significantly outweighed any prejudice arising from its admission and the evidence was admitted for a permissible use under s 34P(2)(a), Evidence Act 1929.

4.  The charges were properly joined on the same complaint pursuant to s 4K(3), Crimes Act 1914 (Cwth).

5.  The Magistrate was justified in considering that an immediate term of imprisonment to be the only appropriate sentence in all of the circumstances.

Criminal Code (Cth) s 135.2; Workers Rehabilitation and Compensation Act 1986 s 120(1); Crimes Act 1914 (Cth) Part 1B, 4K(3), 16A(1), 16A(2), 16(C)(1), 17A, 20(1)(b), 29D; Evidence Act 1929 (SA) ss 34P(2), 34R, referred to.
Walsh v Tattersall (1996) 188 CLR 77; R v Taylor (1997) 6 Tas R 310, distinguished.
Jovanovic v Director of Public Prosecutions (Cwth) (2012) 271 FLR 38, discussed.
R v Maiolo (No 2) (2013) 117 SASR 1; R…

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Details
Case
[2014] SASC 143
Decision Date

CaseChat Overview and Summary

In the Supreme Court of South Australia, the appellant, Phuong Huynh, appealed against his conviction and sentence for defrauding the Commonwealth, specifically by falsely declaring his employment and income status to Centrelink. Huynh was found guilty on seven counts of obtaining a financial advantage by deception and was sentenced to 12 months imprisonment, with two months to be served. The appeal was dismissed by Justice Peek. The legal issues in the appeal related to the admissibility of evidence of previous overpayments and the joinder of the counts in the complaint. The court held that the evidence of previous overpayments was relevant and highly probative, demonstrating Huynh's knowledge of Centrelink's practices and his deliberate actions. The counts were properly joined as they shared an underlying unity in Huynh's course of conduct. The court also confirmed that the language in s 135.2 of the Criminal Code encompasses ongoing conduct leading to multiple payments or benefits. The appeal against sentence was dismissed, with the court affirming that imprisonment was the appropriate sentence given the sustained and deliberate nature of the fraud.

Justice Peek concluded that the Magistrate's considerations and sentence were justified. The court took into account the nature and circumstances of the offending, Huynh's personal circumstances and antecedents, and the financial circumstances of the offender. The court found that Huynh had not made sufficient reparation for the total defalcation, and thus, the Magistrate's order for repayment of the outstanding amount was appropriate. The sentence of imprisonment was deemed necessary, particularly given the appellant's unmeritorious appeal and the nature of the sustained welfare fraud. The court upheld the Magistrate's discretion in not ordering immediate release and in imposing a term of imprisonment.

Orders

Orders of the court

Held per Peek J (dismissing the appeal):

1. The language “obtain a financial advantage” used in s 135.2 of the Code creates an offence the subject matter of which encompasses ongoing conduct that gives rise to the payment of multiple payments or benefits. The counts were not duplicitous and did not each charge the appellant with the commission of more than one offence: Walsh v Tattersall (1996) 188 CLR 77; R v Taylor (1997) 6 Tas R 310 distinguished.

2. The evidence of previous overpayments to the appellant by Centrelink was admissible in relation to all counts, and the evidence in relation to counts 1 and 2 was cross-admissible in relation to counts 3 to 7 and vice versa.

3. The probative value of the evidence of overpayments significantly outweighed any prejudice arising from its admission and the evidence was admitted for a permissible use under s 34P(2)(a), Evidence Act 1929.

4. The charges were properly joined on the same complaint pursuant to s 4K(3), Crimes Act 1914 (Cwth).

5. The Magistrate was justified in considering that an immediate term of imprisonment to be the only appropriate sentence in all of the circumstances.

Background

Background to the litigation

Her Honour delivered judgment on 15 November 2013 and found the appellant guilty on all seven counts. On 14 July 2014, convictions were recorded on each count and the appellant was sentenced (for all of the offending) to 12 months imprisonment to be released after serving two months upon entering into a recognisance to be of good behaviour for a period of 15 months.[1] The appellant appeals against both conviction and sentence. He was granted bail pending the outcome of this appeal.[1] Pursuant to s 20(1)(b), Crimes Act 1914 (Cwth).The background facts as found by the Magistrate The background facts may be recited by adopting the Magistrate’s findings of fact which are not complained of in the grounds of appeal. They were as follows:[7]On 10 July 1995 the defendant opened a joint bank account with Ms Xiufang Pei, with St George Bank. St George Bank is a subsidiary of Westpac Banking Corporation (Westpac) and operates in South Australia under its subsidiary Bank SA. This Bank SA account has operated continuously since 1995 (BSB and account number 105116/053889340).[8]The defendant has received Centrelink Payments almost continuously since September 1997. Since 18 April 1998 he has been required to periodically report his income.[9]Between 2000 and 2003 he reported income from Stardrip Irrigation Pty Ltd (Stardrip).[10]On 16 May 2002 the defendant signed a Customer Declaration Form for New Start Allowance (NSA) at the Port Adelaide Centrelink office. On the same day he signed a Claim for Job Network Assistance while Looking for Work form and a Preparing for Work Agreement. He was granted and commenced to receive fortnightly payments of NSA. NSA is a means tested allowance and the recipient is under an obligation to declare any employment income. He supplied an Australian Passport E6300408 in the name Phuong Huynh. He was allocated the Customer Reference Number 502921134T and a Job Network Number 9878102005.[11]From the period 3 May 2004 to present, the defendant has resided at 630 Greenhill Road, Burnside, South Australia.[12]In 2004 Centrelink raised a debt against the defendant because he had been overpaid $108.60 in NSA for the period 20 November 2004 to 3 December 2004 because he under-declared his income from Virginia Farms. Repayments were subsequently [deducted] from the defendant’s Centrelink benefits.[13]Centrelink raised a debt against the defendant of $9,945.00 for the period 19 June 2004 to January 2006 arising from the defendant under-declaring his earnings from Stardrip. Centrelink advised the defendant of these debts by letter and also spoke to him as part of the usual process when imposing recovery fees. Subsequently, repayments were deducted from the defendant’s Centrelink benefits.[14]On 29 December 2005 the defendant attended a Centrelink office and discussed with a Centrelink officer his wish to apply for Parenting Payment Partnered (PPP). He was told of his obligation to report income. The defendant supplied the following forms of identification to Centrelink in support of this claim for PPP to establish identity before completing and signing all necessary documentation:South Australian Driver’s Licence no. F85733 in the name Phuong Huynh.Commonwealth Bank ATM receipts for card no 535316.Bank SA ATM card 5602 6501 5406 9218.Medicare card number 5100 56302 6, listing person 2 as Phuong Huynh.Identification documentation for his partner Ms Pei.[15]On 28 January 2006 the defendant was granted and commenced receiving PPP. This payment is a means tested income supplement and is granted with the condition of an ongoing obligation on the recipient to notify Centrelink of any employment income.[16]Between 29 December 2005 and 20 November 2007, the fortnightly payments of benefits were paid into the St George Bank account operated by the defendant and Ms X Pei.[17]Between 15 May 2009 and 22 September 2010, the fortnightly payments of benefits were paid into the defendant’s account, in the name, Mr Phoung Huynh trading as No Mess Around Security, (BSB and account number 065004/10484985).[18]The defendant declared income from Virginia Farm, received during the following periods:15 February 2002 and 16 December 2005.30 November 2007 and 17 April 2009.[19] The defendant did not declare income received from Stardrip between:29 December 2005 and 20 November 2007.[20]In 2009 Centrelink raised two debts against the defendant because he had been overpaid NSA and PPP because of his earnings with Stardrip. The defendant subsequently commenced working for ACG National Pty Ltd (ACG). [21] The defendant did not declare income received from ACG between:15 May 2009 and 22 September 2010.Contact with Centrelink and requests to disclose income[22]Prosecution presented copies of the defendant’s file with Centrelink. The file is comprised of hard copy documents and electronic files. The hard copy documents consisted of claim forms, medical certificates and records of correspondence about overpayments. The electronic records gave a full account of all contacts with the defendant, correspondence in which he was asked to detail his earning and a record of conversations with Centrelink staff. The online documents record all contact with the defendant, whether in person or online.[23]During the relevant time the defendant never disclosed he was employed and earning income and so it is relevant to consider this history in the context of other periods when he did contact Centrelink and declare income as follows:Between 2000 and 2003 the defendant declared to Centrelink that he was working and earning income from Stardrip.Between 15 February 2002 and 16 December 2005 the defendant declared income from Virginia Farms.On 16 May 2002 the defendant attended the Centrelink office at Port Adelaide for an interview with a Centrelink employee. During this interview the defendant provided his passport to establish [identity], before completing and signing all documents necessary to apply for a NSA.On 7, 16, and 21 December 2005 the defendant contacted Centrelink regarding an application for Parenting Payment Partnered (PPP).On 29 December 2005 the defendant attended the Centrelink office at Norwood to apply for PPP. He signed a Customer Declaration Form, which recorded that he was not working.From 30 December 2005 and 27 January 2006, the period in which his claim for PPP was being processed the defendant completed, signed and lodged three Application for Payment Forms. In all forms he ticked, No, to the question, Did you do any work in the [relevant] period?On 13 January 2006 he attended the Norwood office of Centrelink and submitted a signed application stating he was not working.Once in receipt of PPP, between 27 January 2006 and 20 September 2007, the defendant was not required to submit documentation and actively report his income. On 20 June 2006, during a routine review by Centrelink’s Call Centre of the defendant’s PPP benefit on 20 June 2006, the defendant advised that neither he nor Ms Pei had earned employment income during the review period. From 20 September 2007 and 2 April 2010, the defendant was placed on a reporting regime, which required him to contact Centrelink and provide information for a Customer Update for PPP. He was required to complete 21 Applications for Payment Forms. In all forms he ticked the NO box on the form in answer to the question; Did you do any work in the [relevant] period? [28]I accept the undisputed evidence of the directors of Stardrip; Mr Tan Nguyen, Mr Minh Son Dang and Mr Thai Au and find the defendant worked for Stardrip in the periods relevant to Count 1 and Count 2. He was the only employee of Stardrip and over the period relevant to the charges received 100 cash payments as income. The Tax Agent, Mr Evanoff confirmed that, although the directors did not comply with requirements to provide payslips, or attend in a timely manner to provide Group Certificates, or contribute to a superannuation scheme to cover the defendant’s employment, the business records confirm that the defendant was paid in cash on a weekly basis during the relevant period.[29]I accept as reliable all documents presented by prosecution to show that PPP payments were made into bank accounts operated by the defendant in all periods relevant to these charges.[30]I accept as reliable the evidence of the defendant’s earnings from Stardrip and ACG in the relevant periods. [31]I accept the evidence of Mr Tan Nguyen that in the period covered by Counts 1 and 2, the defendant was employed by Stardrip on a casual basis and received income. All income was received in cash payments, usually on a fortnightly basis.[32]I accept the evidence of Mr Tony McGrath and the content of his statements and find that the defendant recorded his hours of work on time sheets, he received the income into his bank account and he received payslips from ACG confirming the amount of income he received. [33]During the period of alleged offending the defendant was employed on a casual basis by Stardrip and ACG and earned approximately $41,201.20 combined gross income. He declared none of this income to Centrelink.[34]I find that in each charge period the defendant earned in excess of the $62.00 permissible per fortnight without a resulting reduction in entitlement.The Magistrate’s specific findings on each count

Evidence

Evidence Before The Court

I reject ground 1 of appeal.Grounds 3 and 4 of Appeal: Admissibility and cross-admissibility of evidence The appellant contended that the Magistrate erred, first, in ruling that the evidence of previous overpayments was admissible in relation to any count and, second, in ruling that the evidence directed to counts 1 and 2 was admissible in relation to counts 3 to 7 (and vice versa). I consider that the Magistrate did not err in either regard. As to the prior overpayments, the evidence was that the appellant had two previous debts to Centrelink, one of $108.60 and the other of $9,945.00. Both debts had been raised because the appellant had under-declared his income to Centrelink and had thereby received a level of benefits to which he was not entitled. On each occasion, the appellant had been notified of these debts by Centrelink, by letter and phone call, and it was explained to him why they had occurred. In my view, this evidence had relevance other than as disclosing a propensity to commit such offences. Rather, it was highly probative of the propositions that the appellant had a good knowledge and understanding of Centrelink’s practices and requirements; that he knew that the result of his non-declaration of income would be that he would receive benefits to which he was not entitled; and that his actions in falsely declaring his employment and income status to Centrelink were deliberate and not accidental. As to cross-admissibility, the evidence supporting any one of the counts on the complaint was also relevant to, and highly probative of, each of the other counts as tending to prove the same propositions referred to immediately above in the context of past overpayments.The Magistrate’s reasons The Magistrate correctly expressed the position thus:[24]The evidence supporting each count is admissible in proving every other count as there is an underlying unity in the defendant’s course of behaviour. The evidence of the defendant’s actions in relation to each count is highly probative in relation to each other charge because of the defendant’s course of conduct over a number of years in falsely detailing his employment status and income to Centrelink.[25]I confirm my previous ruling and find the defendant’s history of prior overpayments, particularly the $9,945.00 overpayment he received for the period immediately prior to the period covered in count 1 is admissible in relation to all counts to show that at the relevant time:The defendant has a history of experience with Centrelink in reporting income and has episodically complied with these requirements since 1998.The defendant was aware that a debt would be raised as a consequence of failing to correctly notify Centrelink of any incomes earned in any periods where an entitlement to NSA or PPP is claimed.The defendant was aware that the NSA and PPP are means tested and his benefit would be reduced if he earned in excess of $62.00 per payment period in any period in which he claims NSA or PPP.The defendant had knowledge of his obligations to currently state his income and not make false declarations to Centrelink.The defendant obtained knowledge of his obligations through his dealings with Centrelink, including his need to comply with reporting conditions and accurately state the amount of income.The defendant was aware in 2006 that he faced reduced benefits because of a $9,945.00 overpayment.The defendant was aware of all the avenues available to contact Centrelink and declare income; by telephone, in writing and the Internet. [26]I find that during the periods of the alleged offences the defendant received 95 letters from Centrelink which were mostly letters enclosing application for Payment Forms for PPP. These letters variously included account statements, letters advising of approval for PPP, the obligations of PPP and debts caused by Centrelink. There is no doubt that the defendant received this correspondence as he responded as required.[27]I reject as a reasonable possibility that the defendant could have misinterpreted any of the questions, which asked if he had done any work during the relevant periods. I find his denial that he did any work was false. He was well aware of his responsibility under the reporting regime and always answered questions about his income, filled in all documents either in writing or online and submitted all in a timely manner.

Decision

Reasons for decision

PEEK J

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Established by: PEEK J

Her Honour properly took into account the relevant factors referred to in s 16A(2), for the purposes of s 16A(1), Crimes Act 1914 (Cwth) including: ·The summary of facts summarising (and incorporating) the nature and circumstances of the offending, consistent with the learned Magistrate’s findings during the trial proceedings; ·The appellant’s personal circumstances and antecedents including the material in the psychological and pre-sentence reports provided to the court; and·the financial circumstances of the offender: Crimes Act 1914, (Cwth) s 16C(1). Restitution or reparation The learned Magistrate was required to take into account any action taken by the appellant to make reparation.[20] It was earnestly argued that the appellant had received insufficient credit for the fact that the Commonwealth had received “substantial reparation of the total defalcation of $15,756.98”. It transpired that what had occurred was that during the sentence proceedings, the Magistrate had been informed by the prosecutor that approximately $7,400 of the appellant’s overpayment had been “repaid” to Centrelink by way of automatic withholdings from his subsequent fortnightly Centrelink benefit. The Magistrate ordered that the full balance amount outstanding (approximately $8,356.98) was to be repaid. On the appeal, I was informed that the appellant had made no such payment or part payment.[20] See Crimes Act 1914 (Cwth) s 16A(2)(f)(i); Kovacevic v Mills (2000) 76 SASR 404; Slowiak v Director of Public Prosecutions (Cth) [2000] SASC 282. As I understood the appellant’s submission, both a contrition element and a utilitarian element was to be discerned here on two bases. First, the appellant had refrained from objecting to the Commonwealth withholding the pension payments totalling approximately $7,400. Second, the Magistrate had ordered him to pay the outstanding amount of approximately $8,356.98 and it should be presumed that he will do so. I consider that the Magistrate dealt with the matter fully and most patiently. It was not established that the Magistrate did not give the appellant adequate credit in this regard or that she erred in any other way.Disposition of the appeal against sentence The maximum penalty for each offence was 12 months imprisonment and/or a fine of $6,600. The appellant engaged in a lengthy trial followed by an appeal which was wholly unmeritorious. He clearly does not deserve the leniency he may have received for a plea of guilty on a contrition or a utilitarian basis. The Magistrate was justified in considering imprisonment to be the only appropriate sentence in the circumstances here. Her Honour properly declined to order the immediate release of the appellant. Such a decision was well within her discretion; it is well established that in cases of sustained and deliberate welfare fraud such as the present, an order for imprisonment, with at least some of the imprisonment actually to be served, is often imposed, even for a first offender.[21][21] Kovacevic v Mills (2000) 76 SASR 404, 411-412.