Kelly v The King

[2023] NSWCCA 104

Court of Criminal Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Kelly v R [2023] NSWCCA 104

Hearing dates:

10 March 2023

Date of orders:

10 March 2023

Decision date:

17 May 2023

Before:

Bell CJ at [1];
Walton J at [18];
Davies J at [130]

Decision:

(1) Grant leave to appeal.

(2) Dismiss the appeal.

Catchwords:

CRIME – sentencing –– application for leave to appeal against sentence - single ground of manifest excess - multiple offences – consideration of patent errors where only ground of appeal manifest excess - whether specific patent errors constitute misapplications of sentencing principles – whether inconsistency in determining indicative sentences – range of objective seriousness – leniency for good character – totality – failure to demonstrate manifest excess - leave to appeal granted – appeal dismissed

Legislation Cited:

Crime (Sentencing Procedure) Act 1989 (NSW)

Crimes Act 1900 (NSW),

Criminal Appeal Act 1912 (NSW)

Cases Cited:

Adzioski v R [2013] NSWCCA 69

Aryal v R [2021] NSWCCA 2; Burke v R [2022] NSWCCA 6

Attorney General’s Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 No 1 of 2002 (2002) 56 NSWLR 146; [2002] NSWCCA 518

Burke v R [2022] NSWCCA 6

CMB v Attorney-General (NSW) (2015) 256 CLR 236; [2015] HCA 9

DH v R [2022] NSWCCA 2000

GG v R [2022] NSWCCA 102

Hayek v R [2016] NSWCCA 126

Higgins v R [2020] NSWCCA 169

House v King (1936) 55 CLR 499 at 504

Hughes v R [2018] NSWCCA 2

JM v The Queen (2014) 246 A Crim R 528; [2014] NSWCCA 297

Markarian vThe Queen (2005) 228 CLR 357; [2005] HCA 25

Kerr v R (2016) 78 MVR 191; [2016] NSWCCA 218

Lees v R [2019] NSWCCA 65

McDowell v R [2018] NSWCCA 29

McLaren v R [2021] NSWCCA 12

McMahon v R [2011] NSWCCA 147

Mulato v R [2006] NSWCCA 282

Noonan v R [2021] NSWCCA 35

Obeid v R (2017) 96 NSWLR 155; [2017] NSWCCA 221

Piscitelli v R [2013] NSWCCA 8

Pleasance v R [2016] NSWCCA 113

R v Brown [2012] NSWCCA 199

R v Clarke [2019] NSWDC 2

R v Curtis (No 3) [2016] NSWSC 866

R v Gent (2005) 162 A Crim R 29; [2005] NSWCCA 370

R v Harris (2015) 70 MVR 412; [2015] NSWCCA 81

R v Hernando (2002) 136 A Crim R 451; [2002] NSWCCA 489

R v Hopkinson, R v Robertson [2022] NSWCCA 80

R v Mungomery [2004] NSWCCA 450

R v Smith (2000) 114 A Crim R 8; [2000] NSWCCA 140

Ryan v The Queen (2001) 206 CLR 267; [2001] HCA 21

Tassis v The Queen [2017] NSWCCA 143

Towney v R [2018] NSWCCA 65

Upadhyaya v R [2017] NSWCCA 162

Vale v R (2016) 77 MVR 194; [2016] NSWCCA 154

Category:

Principal judgment

Parties:

Scott Robert Kelly (Appellant)
Rex (Respondent)

Representation:

Counsel:
G Smith SC (Applicant)
E Wilkins SC (Respondent)

Solicitors:
Ren Zhou Lawyers (Applicant)
Solicitor for Public Prosecutions (Respondent)

File Number(s):

2020/185416

 Decision under appeal 

Court or tribunal:

District Court of New South Wales

Jurisdiction:

Criminal

Date of Decision:

16 December 2021

Before:

Robison DCJ

File Number(s):

2020/185416

HEADNOTE

[This headnote is not to be read as part of the judgment]

The applicant pleaded guilty in the District Court to 31 counts of dishonestly obtaining a financial advantage by deception contrary to s 192E(1)(b) of the Crimes Act 1900 (NSW), plus 59 additional counts of the same offence were included on a series of Forms 1.

The offences to which the applicant pleaded guilty related to a sustained course of fraudulent conduct engaged in over the course of over five years involving some 90 victims and a combined sum of $6.7 million.

The applicant was employed by Man Investments Australia Limited (“Man”). His employment commenced in August 2005 and ended in February 2018. His offending began in 2013 (at which time the applicant was 29 years of age). His last offence occurred in 2018 (at which time the applicant was 34 years of age).

Man offered an investment product to Australian retail investors called “OM-IP”. OM-IP investments involved retail investors purchasing redeemable shares in companies incorporated in the Cook Islands, which would in turn invest the funds in various publicly traded shares, with a portion held in an Australian bank to provide some guaranteed capital on maturity. The investment would have a maturity date of between seven and thirteen years at which point the capital, plus any returns, would be returned to investors.

The applicant’s role was to “reach out to investors and advise them that the fund was coming for maturity”. Most investors would respond and provide banking details. Some would not, and for those investors a cheque would be drawn in their name. Meanwhile, the money was held in an Australian bank. In the ordinary course, if those cheques remained undrawn, the company would be liquidated, and the money would pass to the Cook Islands unclaimed moneys fund.

From 2013, the applicant began to direct the Australian bank to pay certain investors’ unclaimed money (from the undrawn cheques) into bank accounts that were controlled by him. The applicant’s typical method of doing so was to use a copy of the investor’s signature to create false correspondence directing the payment into his accounts. The applicant was able to do so due to his ability to access information, in the course of his employment, concerning the maturity date and value of various investments, as well as whether the maturity cheques had been dispatched and banked.

The applicant used the above method in 88 of his offences. Two further offences involved a similar technique but an investment that had not yet reached maturity. 78 of the 88 offences concerning mature investments involved the use of a copy of the relevant investor’s signature to which the applicant had access due to this employment, in order to forge the payment direction. The fraud was highly likely to have continued but for its discovery.

The applicant sought leave to appeal his sentence pursuant to s 5(1)(c) of the Criminal Appeal Act 1912 (NSW) on the sole ground that it was manifestly excessive. The applicant also relied on numerous alleged patent errors of sentencing principle to support this ground, namely, the indicative sentences for multiple counts were inconsistent; assessing counts 18 and 29 as above the mid-range of objective seriousness was erroneous; the notional starting point of the aggregate sentence was too high; and, finally, that the trial judge misapplied sentencing principles with respect to the applicant’s prior good character.

The Court held (Walton J, Bell CJ and Davies J agreeing), granting leave to appeal against sentence but dismissing the appeal:

1. Indicative sentences entered pursuant to s 53A(2) of the Crimes (Sentencing Procedure) Act 1989 (NSW) are not amenable to appeal: [12] (Bell CJ); [42] (Walton J); [130] (Davies J, agreeing).

R v Brown [2012] NSWCCA 199; JM v The Queen (2014) 246 A Crim R 528; [2014] NSWCCA 297; Kerr v R (2016) 78 MVR 191; [2016] NSWCCA 218 applied.

2. An indicative sentence may nonetheless be a guide to whether error is established in relation to the aggregate sentence: [43] (Walton J); [130] (Davies J, agreeing).

R v Brown [2012] NSWCCA 199; JM v The Queen (2014) 246 A Crim R 528; [2014] NSWCCA 297 applied.

3. Even if indicative sentences are excessive that does not necessarily, much less inevitably, mean that the aggregate sentence is excessive: [12] (Bell CJ); [43] (Walton J); [130] (Davies J, agreeing).

Burke v R [2022] NSWCCA 6; JM v The Queen (2014) 246 A Crim R 528; [2014] NSWCCA 297; Kerr v R (2016) 78 MVR 191; [2016] NSWCCA 218 applied.

4. The principal focus of the determination of a ground alleging manifest excess is whether the aggregate sentence reflects the totality of the criminality involved: [12] (Bell CJ); [44] (Walton J); [130] (Davies J, agreeing).

JM v The Queen (2014) 246 A Crim R 528; R v Brown [2012] NSWCCA 199 applied.

5. There was no error in finding counts 18 and 29 were above the mid-range of objective seriousness. Count 18 involved over $1 million, making it a serious instance of fraud. Further, the implicit allegation raised by the applicant that the trial judge erroneously incorporated the Form 1 offences into a determination of the severity of count 29, was misguided. Imposing a longer sentence was open to the trial judge to recognise the community’s entitlement to retribution where no separate punishment for the Form 1 offences was imposed: [90]-[97] (Walton J); [130] (Davies J, agreeing).

Attorney General’s Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 No 1 of 2002 (2002) 56 NSWLR 146; [2002] NSWCCA 518; DH v R [2022] NSWCCA 200 considered.

6. Referencing the notional starting point of the aggregate of 17 years and 4 months by the applicant to allege manifest excess was erroneous. Attribution of the notional starting point before the discount is to apply to indicative sentences: [98]-[99] (Walton J); [130] (Davies J, agreeing).

Hayek v R [2016] NSWCCA 126; Piscitelli v R [2013] NSWCCA 8; Tassis v The Queen [2017] NSWCCA 143; Adzioski v R [2013] NSWCCA 69; R v Hopkinson, R v Robertson [2022] NSWCCA 80 considered.

7. The sentencing judge did take into account the applicant’s prior good character. There was no error in reducing the weight given to this factor in sentencing. The fact that the fraud occurred on numerous occasions over a prolonged period meant the rationale for reducing the sentence for prior good character was of reduced significance: [113]-[116] (Walton J); [130] (Davies J, agreeing).

Ryan v The Queen (2001) 206 CLR 267; [2001] HCA 21 distinguished; R v Gent (2005) 162 A Crim R 29; [2005] NSWCCA 370 considered.

8. The aggregate sentence imposed was not manifestly excessive. The applicant was engaged in a very serious, systematic course of criminal conduct involving fraud. It is not diminished because of the white-collar nature of the crime and significant emphasis was required to be given to general deterrence and the denunciation of the conduct. The motive was clearly greed, as the luxurious lifestyle he was able to lead went well beyond any concerns he could have had about supporting his family financially. At the time of his arrest, the applicant intended to commit further fraud of a substantial magnitude: [14] (Bell CJ); [120] and [122] (Walton J); [130] (Davies J, agreeing).

JUDGMENT

1. BELL CJ: This is an application for leave to appeal an aggregate sentence of 13 years imprisonment with a non-parole period of 8 years in respect of some 31 fraud offences with a further 59 such offences being taken into account on a series of Forms 1.

2. It is complained that the aggregate sentence imposed was manifestly excessive.

3. The offences to which the applicant pleaded guilty related to a sustained course of fraudulent conduct engaged in over the course of over 5 years involving some 90 victims and a combined sum of $6.7 million.

4. The applicant was employed by Man Investments Australia Limited (“Man”). His employment commenced in August 2005 and ended in February 2018. His offending began in 2013 (at which time the applicant was 29 years of age). His last offence occurred in 2018 (at which time the applicant was 34 years of age).

5. Man offered an investment product to Australian retail investors called “OM-IP”. OM-IP investments involved retail investors purchasing redeemable shares in companies incorporated in the Cook Islands, which would in turn invest the funds in various publicly traded shares, with a portion held in an Australian bank to provide some guaranteed capital on maturity. The investment would have a “maturity date” of between seven and thirteen years at which point the capital, plus any returns, would be returned to investors.

6. The applicant’s role, as he described it at the sentence proceedings, was to “reach out to investors and advise them that the fund was coming for maturity”. Most investors would respond and provide banking details. Some, evidently, would not, and for those investors a cheque would be drawn in their name (described as a “maturity cheque”). Meanwhile, the money was held in an Australian bank. In the ordinary course, if those cheques remained undrawn, the company would be liquidated and the money would pass to the Cook Islands unclaimed moneys fund.

7. However, from 2013, the applicant began to direct the Australian bank to pay certain investors’ unclaimed money (from the undrawn cheques) into bank accounts that were controlled by him. The applicant’s typical method of doing so was to use a copy of the investor’s signature to create false correspondence directing the payment into his accounts. The applicant was able to do so due to his ability to access information, in the course of his employment, concerning the maturity date and value of various investments, as well as whether the maturity cheques had been dispatched and banked.

8. The applicant used the above method in 88 of his offences. Two further offences involved a similar technique but an investment that had not yet reached maturity. 78 of the 88 offences concerning mature investments involved the use of a copy of the relevant investor’s signature to which the applicant had access due to this employment, in order to forge the payment direction.

9. The fraud was highly likely to have continued but for its discovery. As recounted by the sentencing judge, it was motivated by ever-growing greed on the part of the applicant. The details are recounted in more detail in the judgment of Walton J but an indication of his avarice may be seen from the fact that from 14 December 2013 until the time of his arrest, the applicant was the registered owner of a series of expensive motor vehicles, often simultaneously. Those vehicles included one Audi A3, two Audi Q7s, one Audi S3, one Mercedes-Benz 205, one Porsche 991, one Tesla Model X, one Audi RS7, one Volkswagen Tiguan, one Lamborghini 724, one McLaren MP4-12C and one Porsche Macan.

10. The sentencing judge, in imposing an aggregate sentence, also indicated the sentences he would have imposed in relation to the individual offences had he not chosen to impose an aggregate sentence.

11. Heavy reliance was placed in submissions on appeal on certain apparent inconsistencies in some of the indicative sentences in respect of offences relating to fraudulent diversion of similar or identical amounts of money. Many of these apparent inconsistencies were explicable on the basis that higher indicative sentences for later offences reflected the fact of repeated and growing brazenness on the part of the applicant to the increasing fraud. Not all of the apparent inconsistencies, however, lent themselves to a rational or coherent explanation.

12. That not all apparent inconsistencies could be so explained may invite attention as to the sentencing judge’s broader reasoning process. As Fullerton J observed in Burke v R [2022] NSWCCA 6 at [34], “[a]s a matter of principle, even if there might be discerned a lack of uniformity in the sentencing judge’s appointment of indicative sentences for similar offences of the same objective seriousness, that will not necessarily, much less inevitably, lead to the conclusion that the aggregate sentence is manifestly excessive.” It is critical to keep in mind that indicative sentences are not amenable to appeal (see JM v The Queen (2014) 246 A Crim R 528; [2014] NSWCCA 297 at [40]), and the focus must always be on questions of totality and whether the aggregate sentence is manifestly excessive: Aryal v R [2021] NSWCCA 2 at [49]-[50]; Noonan v R [2021] NSWCCA 35 at [33]; GG v R [2022] NSWCCA 102 at [84]-[86].

13. In this context, the well-known limitations, as elucidated by R A Hulme J in Obeid v R (2017) 96 NSWLR 155; [2017] NSWCCA 221 at [443], must also be borne in mind:

1. Appellate intervention is not justified simply because the result arrived at in the court below is markedly different from sentences imposed in other cases.

2. Intervention is only warranted where the difference is such that it may be concluded that there must have been some misapplication of principle, even though where and how is not apparent from the reasons of the sentencing judge, or where the sentence imposed is so far outside the range of sentences available that there must have been error.

3. It is not to the point that this Court might have exercised the sentencing discretion differently.

4. There is no single correct sentence and judges at first instance are allowed as much flexibility in sentencing as is consonant with consistency of approach and application of principle.

5. It is for the applicant to establish that the sentence was unreasonable or plainly unjust.

14. In the present case, the aggregate sentence imposed was, in my view, not manifestly excessive for a sustained course of fraudulent conduct involving large sums of money, both individually and collectively, multiple victims and the repeated forging of client signatures. Any inconsistencies in certain of the indicative sentences appointed by the sentencing judge do not undermine this conclusion.

15. Apart from the reliance on some apparent inconsistencies as between certain of the indicative sentences, the only other suggested error of principle raised on the applicant’s behalf (although not one apparently related to the sole ground of appeal, namely that the sentence was manifestly excessive) concerned the sentencing judge’s remarks that the applicant’s good character evaporated “over time” and “I must say really that character evaporated at the time when the first offence was committed.” It was submitted, correctly, that considerations of past good character are not to be ignored or superseded in the sentencing exercise by the very fact of the offending in relation to which the sentencing exercise is taking place: Ryan v The Queen (2001) 206 CLR 267; [2001] HCA 21 at [2], [36]-[37], [102].

16. As Walton J has shown, however, the particular language of the sentencing judge noted in the previous paragraph was really only to indicate the beginning of the applicant’s criminality. His previous good character was taken into account in the passages identified by Walton J and, in particular, in the sentencing judge’s statement that he took into account “that he certainly does not have any criminal record at all prior to the offending and certainly prior to the offending was a person of good character.”

17. I agree with the orders proposed by Walton J.

18. WALTON J: By a Notice of Appeal filed on 26 September 2022, the applicant, Scott Robert Kelly, sought leave to appeal, pursuant to s 5(1)(c) of the Criminal Appeal Act 1912 (NSW), the sentence imposed by Robison DCJ (“the sentencing judge”) on 16 December 2021, following pleas of guilty with respect to 31 fraud offences plus 59 further such offences taken into account on a number of Forms 1.

19. The sentencing judge imposed an aggregate sentence of 13 years imprisonment with a non-parole period of 8 years. The sentence commenced on 16 December 2021 and will expire on 15 December 2034. The applicant is eligible for parole on 15 December 2029, having served no pre-sentence custody.

20. The 31 counts the subject of the guilty pleas were placed on indictment. Each of the counts on indictment and offences placed on a Form 1 were laid pursuant to s 192E(1)(b) of the Crimes Act 1900 (NSW), namely, that the applicant dishonestly obtained a financial advantage by deception. The maximum penalty for each offence is 10 years imprisonment. There is no standard non-parole period.

21. In order to assist in describing the 31 counts on the indictment and the corresponding sequence for each charge, (I shall refer in this judgment to “counts” rather than the sequences sometimes referred to by the parties), the correspondence between offences taken into account under Form 1 and particular counts and the indicative sentence for each count, “Annexure B” to the Crown submissions is attached to this judgment and marked as “Annexure 1”. That Schedule also serves to further illustrate the nature of the applicant’s offending.

22. The applicant was employed by Man Investments Australia Limited (“Man”) whose business model involved obtaining investment funds from Australia and investing those funds in offshore investment entities in the Cook Islands for up to 13 years. The applicant commenced employment with Man in August 2005. His offending commenced in 2013 when he was 29 years of age and his last offence occurred in 2018 when he was 34 years of age.

14. The applicant directed funds belonging to retail investors in investment products that were offered and managed by the Man Group, into accounts that benefited the applicant. The products targeted by the applicant were called ‘OM-IP’ which were long-term investments with a 7-to-13-year maturity date. At the time of the maturity date, there were sometimes unclaimed funds from the product, sometimes resulting from a change in customer details or the death of a customer. It could take Man many years to locate the appropriate person for payment of the funds.

15. The product was operated by retail investors purchasing redeemable shares in a company which was incorporated in the Cook Islands. Each product had its own ‘Cook Co’ incorporated company. The Cook Co would invest a portion of the invested funds and would also hold a portion of the invested funds in an Australian bank to provide some guaranteed capital upon maturity.

16. After a specified period of time had elapsed, following the maturity date, the Cook Co would typically enter liquidation with the unclaimed monies being paid into the Cook Islands’ unclaimed moneys fund for collection by the investor.

17. As part of the applicant’s role in the company he had access to information with respect to these investments, including the maturity date of the investments, the value of the investments, whether maturity cheques had been dispatched and whether maturity cheques had been banked. The applicant’s fraudulent conduct involved the transfer of funds belonging to investors into bank accounts which he owned or operated.

18. In all, the applicant committed 90 offences of fraud in breach of s 192E(1)(b) of the Crimes Act 1900 (NSW), amounting to a total of $6,720,712.70 over the five-year period between 2013 and 2018.

19. 88 of the 90 separate transactions involved investments which had reached maturity and two were fraudulent transactions prior to maturity. The 88 mature investment frauds involved forged letters of instruction, 78 of which involved the applicant forging the investor’s signature.

20. When the applicant’s computer was searched a password protected spreadsheet (last updated 1 February 2018) was located indicating the applicant “still needs” $1,327,215 for his home. A further note indicated to “add funding” of $817,401.50. The applicant admitted under cross-examination in the sentencing proceedings that this was a reference to money he intended to obtain by continuing to defraud investors.

21. The applicant repaid $900,000 of the dishonestly obtained funds. Man had refunded 20 of the 90 investors defrauded by the applicant as at 8 April 2021.

Ground of Appeal and Relevant Principles

31. The applicant brought a single ground of appeal, namely that the sentencing judge had erred in imposing a sentence that was manifestly excessive.

32. Nonetheless, the applicant contended that the sentencing judge had imposed an aggregate sentence by misapplication of sentencing principles as follows:

1. There was inconsistency in determining the indicative sentences.

2. Count 29 should not have been described as above the midrange of objective criminality and that all offences described as midrange should have received smaller indicative sentences.

3. The starting point was too high.

4. The learned sentencing judge misapplied principles concerning prior good character.

33. The law relevant to an appeal on the basis of manifest excess is well settled.

34. When proposing that the exercise of a sentencing discretion resulted in a sentence which was manifestly excessive, the appellant must be taken as contending the sentencing process was attended by the last mentioned error in House v The King (1936) 55 CLR 499; [1936] HCA 40 at 505, such that a sentence is manifestly excessive where the applicant shows that the sentence is “unreasonable or plainly unjust”: Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25 (“Markarian”) at [25]. This has to be established in a context where there is no single correct sentence and where judges, at first instance, are to be allowed as much flexibility in sentencing as is consonant with consistency of approach and application of principle: Vuni v R [2006] NSWCCA 171 at [33] per Hoeben J (as his Honour then was, with Tobias JA and James J agreeing); Markarian at [27] and Vale v R (2016) 77 MVR 194; [2016] NSWCCA 154 at [37] (per Hoeben CJ at CL, with whom Rothman and RA Hulme JJ agreed).

35. In McDowall v R [2019] NSWCCA 29 at [38], Adamson J (as her Honour then was) (with whom Hoeben CJ at CL and Schmidt J agreed) stated:

The ground of manifest excess is a challenge to the result of the sentence. It is not necessary for the applicant to identify any particular error in the process that led to the result but merely to persuade the Court that the result was manifestly excessive. The applicant must establish that the sentence imposed was unreasonable or plainly unjust, having regard to the principles that there is no single “correct” sentence and that judges at first instance are to be allowed as much flexibility in sentencing as the application of principle and consistency of approach allow: Dinsdale v The Queen (2000) 202 CLR 321; [2000] HCA 54 at [6] (Gleeson CJ and Hayne J).

36. As Adamson J (as her Honour then was) emphasised in McDowall, the ground of manifest excess concerns latent error. In R v Harris (2015) 70 MVR 412; [2015] NSWCCA 81 at [46] her Honour observed (with the concurrence of Basten JA and RA Hulme J) as follows:

It may be that the Crown has, in endeavouring to identify an error such as would overcome the first of the two hurdles specified, felt the need to specify a number of grounds in its amended notice of appeal. However, although the amended notice of appeal contained three grounds, there is, in substance, only one: manifest inadequacy. The other grounds appear to me to form the basis for the substantive ground. The claim of manifest inadequacy is a conclusion and does not depend on the establishment of specific error: Dinsdale v The Queen [2000] HCA 54; 202 CLR 321 at [6]. Nonetheless the identification of specific error may assist to explain why, if it be so, a sentence is manifestly inadequate. Nothing in CMB supports, in my view, the proposition that specific error must be identified before this Court will intervene, if manifest inadequacy can be established.

37. The reference to CMB v Attorney-General (NSW) (2015) 256 CLR 236; [2015] HCA 9 in that extract should be seen in the context of the earlier reference by her Honour to R v Hernando (2002) 136 A Crim R 451; [2002] NSWCCA 489 at [12] (per Heydon JA, cited with approval by the plurality in CMB at [34]) to the effect that it was incumbent on the appellant on an appeal under s 5D of the Criminal Appeal Act to demonstrate that the discretion exercised by the sentencing judge was affected by appellable error: Harris at [44].

38. Reference should also be made to the judgment of RA Hulme J (with whom Bathurst CJ, Leeming JA, Hamill and Adams JJ agreed) in Obeid v R (2017) 96 NSWLR 155; [2017] NSWCCA 221 at [443] as follows:

[443]   When it is contended that a sentence is manifestly excessive it is necessary to have regard to the following principles derived from House v The King at 505; Lowndes v The Queen (1999) 195 CLR 665; [1999] HCA 29 at [15]; Dinsdale v The Queen (2000) 202 CLR 321; [2000] HCA 54 at [6]; Wong v The Queen (2001) 207 CLR 584; [2001] HCA 64 at [58]; Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25 at [25], [27]; and Hili v The Queen (2010) 242 CLR 520; [2010] HCA 45 at [59]:

•    Appellate intervention is not justified simply because the result arrived at in the court below is markedly different from sentences imposed in other cases.

•    Intervention is only warranted where the difference is such that it may be concluded that there must have been some misapplication of principle, even though where and how is not apparent from the reasons of the sentencing judge, or where the sentence imposed is so far outside the range of sentences available that there must have been error.

•    It is not to the point that this court might have exercised the sentencing discretion differently.

•    There is no single correct sentence and judges at first instance are allowed as much flexibility in sentencing as is consonant with consistency of approach and application of principle.

•    It is for the applicant to establish that the sentence was unreasonable or plainly unjust.

(See also Hughes v R [2018] NSWCCA 2 at [86]).

39. As will be observed from the aforementioned description of the applicant’s contentions, senior counsel for the applicant does appear to be relying not only on latent error but also patent errors which are described as misapplications of sentencing principles. Two observations should be made in that respect.

40. First, the observations made in Hayek v R [2016] NSWCCA 126 (“Hayek”) at [65] and [66] are applicable as follows:

[65] The ground itself is problematic, in that the applicant seeks to advance three specific asserted errors in support of it. Firstly, that the assessment of the gravity of the applicant's crime as falling within the middle of the range was incorrect. Secondly, that the sentencing judge did not give adequate weight to the applicant's subjective case, and particularly the fact that his long-term drug addiction was a feature that should have significantly mitigated the sentence to be imposed. Thirdly, by reference to the assumed “starting point” for the sentence and sentencing statistics, the sentence and the non-parole period were manifestly excessive.

[66] As was pointed out most recently in Pleasance v R [2016] NSWCCA 113, at [110]:

“A ground asserting manifest excess is one which invites this Court to consider whether the length of the sentence imposed is demonstrated to be outside the range of a sound sentencing discretion, and thus unfair and unjust. It should not be advanced as a means of raising other asserted errors that could have been addressed by a specific ground. Ordinarily, a ground asserting that a sentence is manifestly excessive should be advanced only where specific error of the type identified in the joint reasons of Dixon, Evatt and McTiernan JJ in House v The King [1936] HCA 40; (1936) 55 CLR 499, at 504-505, cannot be identified, or as an alternative to grounds raising specific error.”

41. This first observation brings into sharper focus the contentions of the application with respect to inconsistent indicative sentences.

42. Secondly, an indicative sentence entered pursuant to s 53A(2) of the Crime (Sentencing Procedure) Act 1989 (NSW) is not amenable to appeal: R v Brown [2012] NSWCCA 199 at [17]; JM v The Queen (2014) 246 A Crim R 528; [2014] NSWCCA 297 at [40(11)]; Kerr v R (2016) 78 MVR 191; [2016] NSWCCA 218 at [113]-[114] (per Bathurst CJ with whom Hoeben CJ at CL and Price J agreed).

43. An indicative sentence may nonetheless be a guide to whether error is established in relation to the aggregate sentence: Brown at [17] and JM at [40(11)]. However, even if indicative sentences are excessive, that does not necessarily mean that the aggregate sentence is excessive: JM at [40(12)] and Kerr at [114].

44. The principal focus of the determination of a ground alleging manifest excess, as here, is whether the aggregate sentence reflects the totality of the criminality involved: JM at [40(13)]; Brown at [37]. Thus, in Burke v R [2022] NSWCCA 6 at [32], Fullerton J, with the concurrence of McCallum JA (as her Honour then was) and myself, stated at [34]:

It follows that even were the applicant to have made good his submission that one or more of the sentences indicated for Counts 1, 2, 3, 4, 6, 7, 9, 10 and 12 is excessive by applying the comparative analysis he contends for (an analysis which, for reasons I will come to presently, I do not find persuasive), that would not inevitably support the conclusion that the aggregate sentence is excessive. As a matter of principle, even if there might be discerned a lack of uniformity in the sentencing judge’s appointment of indicative sentences for similar offences of the same objective seriousness, that will not necessarily, much less inevitably, lead to the conclusion that the aggregate sentence is manifestly excessive.

45. Overall, it is important to emphasise that upon the applicant’s appeal, as pleaded, the ultimate question is whether the applicant has established that the aggregate sentence imposed upon him is manifestly excessive.

Reasons for Sentence

46. Having identified that the applicant had pleaded guilty to all counts in the indictment and had entered a plea at the earliest opportunity (resulting in a reduction in sentence of 25% for the utilitarian value of the plea), the sentencing judge turned to the factual background for the purposes of sentence.

47. Much of the factual background described by his Honour is reflected at the commencement of this judgment. However, some particular additional matters may be mentioned:

1. The applicant was employed by Man from 22 August 2005 to 20 February 2018 with an annual salary on commencement of $35,000 and an annual salary at the end of his employment $111,484.92. He received a bonus of $50,959 in 2017. His fraud was not discovered until after his termination.

2. The applicant was able to access information regarding the OM-IP products which included the maturity date, the value of the product, whether maturity cheques had been dispatched and whether maturity cheques had been banked.

3. The fraud was detected after a complaint was received by Man from a customer about an apparent misappropriation of her money. Man investigated and discovered the final redemption payment for her OM-IP product had been paid into a bank account that was not under her control, pursuant to a forged payment instruction. Payment had been made by cheque into a Commonwealth Bank Account but the customer did not operate any such accounts and the cheque had been made pursuant to payment instructions in a letter purported to be written by the customer, and bearing a signature that looked like hers but of which she had no knowledge.

4. The monies obtained by fraud were directed to be paid into accounts by the applicant in his own name or the name of his wife and children.

5. As at April 2020, Man had repaid 20 of the 90 investors whose money had been defrauded plus interest accrued at the Reserve Bank of Australia cash rate plus 6%. Man informed its insurers that its total liability for the frauds could amount to $6,720,712.70 plus interest.

6. In 78 cases of the fraud, the applicant used a copy of the investor’s signature to create false correspondence directing the payments into his accounts. The applicant’s work computer contained lists from which some of the targeted products were drawn, templates for payment instructions which were used for some of the diverted funds, including the insertion of a scanned image investor’s signature and a password protected spreadsheet.

7. The applicant had “a predilection for acquiring luxurious European vehicles”. From 2013 until the time of his arrest, he was the registered owner of a series of expensive motor vehicles, often simultaneously, including two Audi Q7’s, one Mercedes Benz 205, one Porsche 911, one Tesla Model X, one Lamborghini 724, one McClaren MP4-12C and a Porsche Macan. His Castle Hill property was also a product of the fraud.

48. His Honour referred to a Sentencing Assessment Report from which his Honour pointed to a number of matters as follows:

1. The applicant had a ten-year marriage which produced three children which ended when the offending became known and the family lost all their possessions.

2. He currently lives with his supportive fiancé on the Northern Beaches and his children have stayed with him from time to time. He has the support of his parents and sister.

3. He studied for a Bachelor of Accounting and Finance part-time. He was also enrolled in an advanced diploma of horticulture through TAFE and participated in voluntary work for the Northern Beaches Council in gardening and maintenance roles.

4. The applicant accepted responsibility for his actions and realised he had abused the trust and responsibility placed upon him by his employer. At the outset of his offending, he had given very little thought to the consequences of his actions. He stated that moving monies between accounts was very easy to do as it was at times just a matter of cutting and pasting signatures.

5. The author of the Report indicated that the applicant had insisted that most of the funds were not owned, as they were being sent to a holding account in case the owners were found, such that his rationale was that the missing money would not be easily noticed and not affect anyone.

6. He was motivated purely by financial gain and potential status anxiety.

7. Under the Report, the applicant continued to maintain that “the victims were minimally impacted by the actions due to ‘unclaimed monies’ and therefore rarely gave a thought to the consequences of his actions.”

49. The sentencing judge indicated that the applicant had expressed a willingness and an ability to undertake interventions and community service work. He further noted that the applicant had been assessed as low risk of reoffending according to the Level of Service Inventory. The applicant had no criminal history and “no doubt up to the time that he first started to offend, he would have been a person of good character, well thought of by those who know him.”

50. The sentencing judge referred to various testimonials and indicated that he would take into account that support for the applicant.

51. The sentencing judge then indicated that the applicant had come from a stable family environment and appeared to be in good health with no history of mental illness. The applicant had denied he had a history of illicit substance use and there was no history of problematic gambling. The conduct had destroyed his family and “all of this was his own doing, no one else can be blamed for it.”

52. Nevertheless, a report by a psychologist indicated, according to the sentencing judge, that the applicant had been diagnosed with an adjustment disorder with mixed disturbance of emotions and conduct and that the applicant appeared to demonstrate genuine remorse for his offences. The psychologist’s report stated that “the applicant presented with a willingness and ability to consider the rationalisations and distorted thought processes that [the applicant] engaged in at the time of the offending.”

53. The sentencing judge recognised that, in evidence, the applicant had expressed deep remorse. The sentencing judge also indicated that, in his evidence, the applicant had stated that he had engaged in the offending because he wanted to keep his wife happy. It was also recognised that the applicant had stated that he had “a certain view based on certain assumptions about the Cook Islands” which the sentencing judge had taken into account.

54. The sentencing judge then made the following assessment:

Clearly he embarked on this course of conduct for financial gain. Not simply to assist him financially and his family, but he went much, much further than that. When one considers the quantum of the amount which was the subject of the 90 frauds, the number of vehicles that he acquired, he certainly did not need all of those vehicles, so to put it bluntly he lived life “high on the hog”, if I can conveniently use that terminology. That went way beyond mere financial assistance as a result of the commission of these offences. He went much further than that and, bluntly put, it was all about greed, and there can be no escape from that conclusion. It is clearly made out on the evidence and it is a reasonable and rational inference that I have drawn from my assessment of the evidence overall, including his oral evidence.

55. After indicating to the parties that he directed his attention to the decision of the Court of Criminal Appeal in McLaren v R (2021) 287 A Crim R 542; [2021] NSWCCA 12 (“McLaren”) and the decision of the District Court in R v Clarke [2019] NSWDC 2, his Honour referred to the factors identified in Clarke, in cases of fraud such as the present, for the assessment of the objective seriousness of the offending. Those factors included:

1. The amount of money and whether the loss is irretrievable.

2. The length of time over which the offences are committed.

3. The motive for the crime.

4. The degree of planning and sophistication.

5. The extent of any accompanying breach of trust.

56. His Honour indicated that all of those factors needed to be carefully considered when determining how serious cases such as these are.

57. After referring to the maximum penalty for the offences and noting that there was no standard non-parole period attaching to them, his Honour made the following finding as to the applicant’s character, which was raised by the applicant, as a factor bearing upon the ground of the appeal, as follows:

It is submitted on behalf of the offender, amongst other things, that during the five-year period of offending that [sic] may reduce the weight to be given to good character. I have already determined that he was a person of good character before the five-year period of offending occurred, but over time that character effectively evaporated and I must say really that character evaporated at the time when the first offence was committed.

58. As to the motive of the offending, his Honour found as follows:

These offences involved clearly a motive which was not merely to improve the living standards of his family. I have already indicated that given the extent of the offending and the vehicles which were acquired this all eventually amounted to greed, although perhaps initially it was against a background of trying to improve their financial circumstances, but either way none of that excuses the behaviour, far from it, but it is relevant when one considers the question of any motive.

59. His Honour agreed with the submission of the Crown that the offences involved serious objective criminality, having regard to the substantial amount of money involved, the period of time over which the offending occurred, the planning and sophistication involved in the operation, the use of his employment position to commit the offences and the more or less continuous motive maintained throughout the offending which included a motive to fund a luxurious lifestyle.

60. His Honour concluded that counts 18 and 29 involved offending above the mid-range of seriousness, approaching the higher end of that range, whereas other counts generally fell “around the mid-range of objective seriousness”.

61. In reliance of Upadhyaya v R [2017] NSWCCA 162 (“Upadhyaya”), his Honour found that the usual limited utility of comparable sentences was further attenuated in the case of fraud, because of the enormous variation in objective and subjective circumstances in such offending.

62. The sentencing judge considered that general deterrence loomed large, but that specific deterrence was of lesser significance because the sentencing judge did not consider that the offender would reoffend. Reference was made to R v Mungomery (2004) 151 A Crim R 376; [2004] NSWCCA 450 and R v Curtis(No 3) (2016) 114 ACSR 184; [2016] NSWSC 866. As to the significance of deterrence for white collar crime, his Honour considered that the applicant “fits in precisely with a person categorised by McCallum J in Curtis”. His Honour also agreed with the observations in McMahon v R [2011] NSWCCA 147, in which it was observed that the community now views white collar crime very seriously, having regard to the fact that it is easy to commit and difficult and expensive to track down.

63. As to particular subjective considerations, his Honour found as follows:

I do take into account as a mitigating factor, and this is drawing from the written submissions provided on behalf of the offender, that he certainly does not have any criminal record at all prior to the offending and certainly prior to the offending was a person of good character. I certainly agree that he is unlikely to reoffend.

The remorse in my view is accepted by the Court as being genuine. He has included his former employer in that expression of remorse. I think there is a number of elements to that expression of remorse, but by and large when it comes to his acknowledgment of his guilt by virtue of the very early plea of guilty his remorse is neither feigned nor expedient. I accept it as being genuine and real.

I note the references to the Sentencing Assessment Report and the psychological report, I have taken all of that into account.

64. His Honour found special circumstances and that the applicant did not represent a danger to the community.

65. His Honour then indicated that he would announce the indicative sentences which have been set out below in Annexure 1 and that he had to determine those sentences after the application of the full utilitarian value of 25% and some rounding down.

CONSIDERATION

66. Noting the aforementioned principles affecting challenges based upon patent errors in an appeal raising only a manifest excess ground, and mindful that the parties each fully addressed those errors as a guide to whether the sentence was manifestly excessive, I will commence with an examination of the particular errors complained of by the applicant before returning to the ultimate question raised by the appeal.

Whether inconsistency in determining the indicative sentences demonstrate manifestly excessive sentence

The Submissions of the Parties

67. The applicant submitted that the indicative sentences imposed by the sentencing judge were inconsistent and were independently excessive. Specifically, it was contended in both written and oral submissions that there was a lack of uniformity in the sentencing judge’s appointment of indicative sentences, despite the comparable nature of offences. The applicant went so far as to assert that the only material difference between the offences was the “quantum of money the subject of each offence”.

68. A number of examples of indicative sentences were given in written submissions to support this contention. The applicant pointed to the fact that count 5 and count 24 both involved $109,330, however, the indicative sentence for count 5 was 1 year 8 months and the indicative sentence for count 24, was 2 years 5 months. Similarly, the applicant pointed to the sentence for count 3 (involving a fraud of $100,000) compared with the indicative sentences for counts 7, 8, 9, 14, 16, 17, 19, 21, 22, 23, 27, 28 and 30 (“the count 3 comparator group”). It was submitted the count 3 comparator group “all involved sums less than $100,000 but the indicative sentences in each of those sequences were significantly higher than 1 year 6 months.”

69. A further example given was the comparison between count 4 involving $94,818 with an indicative sentence of 1 year 6 months and count 27 involving $98,077 with an indicative sentence of 3 years. There are other indicative sentences that seem inconsistent with each other.

70. Except in relation to the indicative sentence applied to count 29 (a further submission was advanced with respect to count 29 under the applicant’s second contention which is considered below), the applicant did not, in written submissions, contend that the sentencing judge misapplied principles relating to the sentencing for offences where Form 1 offences were to be taken into account. The principles referred to in that context were those found in the guideline judgment of Spigelman CJ (with whom Wood CJ at CL and Grove, Sully and James JJ agreed) in Attorney General’s Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 No 1 of 2002 (2002) 56 NSWLR 146; [2002] NSWCCA 518 (“the Guideline Judgment”). Again, I will return to that judgment in considering the second contention advanced by the applicant.

71. Notwithstanding those contentions, in oral submissions for the applicant, Mr Smith SC submitted that, whilst the applicant did not contend treatment of counts with Form 1 offences were “inconsistent”, the indicative sentence specified by the sentencing judge indicated that his Honour had increased the indicative offences by too much having regard to the Form 1 offences.

72. The applicant also submitted that the sentencing Judge did not group the offences according to the quantum.

73. Again, in oral submissions, the applicant made reference to R v Brown [2012] NSWCCA 199 and JM v The Queen (2014) 246 A Crim R 528; [2014] NSWCCA 297 conceding that, whilst indicative sentences are not amenable to appeal, they may be a guide to whether error is established in relation to the aggregate sentence.

74. The applicant contended that the lack of uniformity in the appointment of indicative sentences for sentences of similar objective seriousness would not necessarily result in a conclusion that the aggregate sentence was manifestly excessive, but it may lead to such a conclusion if there is no logical foundation for the differences or there was a significant number of indicative sentences which are plainly inconsistent (and there had been no grouping).

75. The applicant contended that there was no apparent explanation for the varied sentencing and that this discrepancy pointed to an error in the sentencing process.

76. Having regard to the inconsistencies between the indicative sentences, the applicant contended that the Court would conclude that the aggregate sentence imposed was manifestly excessive.

77. In summary, the Crown contended in written submissions:

1. The later offences are inherently more serious by reason of the fact that they demonstrate a systemic course of criminal conduct;

2. The count 3 comparator group occurred later in time to count 3 and were objectively more serious by virtue of the planning involved, duration and persistence of the offending, the motive of the offender and the extent of breach of trust involved.

3. With respect to counts 21, 22 and 23, where the indicative sentences of 2 years imprisonment were below some (but not all) of the indicative sentences for offences involving similar amounts committed earlier, the fact that those sentences are lower favoured the applicant.

4. As to the applicant’s reliance upon a failure to group the indicative offences, (citing McLaren) the process of “grouping” according to quantum described by the applicant was not a particular feature of the Court’s judgment in McLaren. In any event, the quantum of a fraud offence is but one aspect of the seriousness of the offending. In the present case, the sentencing judge correctly set out the features of the offending relevant to that issue, including duration of offending, degree of planning, motive and extent of breach of trust.

5. Upon the principle of totality, the aggregate sentence is not unreasonable or unjust, particularly when regard is had to the sentences imposed for counts 18 and 29 and the substantial measure of concurrency allowed by the sentencing judge.

6. The applicant’s sole reliance upon the sum involved in each case of fraud failed to have regard to the surrounding circumstances and other factors relevant to the imposition of a sentence as mentioned in (2) above or general deterrence.

78. In oral submissions, the Crown accepted there were anomalies in the indicative sentences and appeared to place less weight on the contentions summarised in (1) and (2) but maintained the submission in (3) – (6). Emphasis was placed upon the smaller sums involved in the inconsistent sentence relied upon by the applicant. The Crown also submitted that the sentencing judge may have lowered some indicative sentences when he had determined to accumulate.

Conclusion: Inconsistent Indicative Sentences

79. There can be no doubt that there was a lack of consistency of approach in the indicative sentences identified by the sentencing judge, although not all of the examples of inconsistency in the indicative sentences raised by the applicant necessarily constituted erroneous assessments understood in the light of the applicable sentencing principles. Some examples raised in written submissions and during the course of argument usefully illustrate these conclusions:

1. The Count 3 comparator offences are inconsistent if attention is directed only to the money sums involved in the fraud. Some of those differences are relatively small (such as count 7, 8, 9) but others such as Count 4 are more substantial. The Crown is correct, however, to submit that counts 14, 16, 17, 18, 28 and 30 are for later offending. The sentencing judge was entitled to have regard to at least the persistency of offending and to issues of general deterrence and denunciation in that respect. I accept the submission advanced by the Crown that the quantum of a fraud offence is but one aspect of the seriousness of the offending, if those considerations are taken into account.

2. The same conclusion may be reached with respect to counts 5 and 24 where the same money sum was involved but a greater sentence was imposed for offending which occurred nearly 3 years later. A similar conclusion is available with respect to counts 1 and 7 or counts 3 and 6 relied upon by the applicant.

3. However, other indicative sentences may not be reconciled in that fashion. There are a number of examples of inconsistency for which no rational basis is apparent for the indicative sentences provided for comparable counts as follows: counts 27 and 28 (where, despite the offences occurring very close in time and the monies the subject of the fraud being less, the second offence in time attracted a lower indicative sentence, albeit by a lower amount); counts 19 and 21 (where there are substantial differences in the indicative sentences, proximity of the dates of the offending and a small difference in the monies the subject of fraud) and counts 19 and 20 (where the indicative sentences were identical and there was a minor gap in time between offending but count 20 involved over double the monies the subject of fraud). Further, count 19 alone is difficult to reconcile with any other counts occurring later in time, (not involving Form 1 offences), given the relatively small sum the subject of the fraud and the setting of a significantly higher indicative sentence (of 3 years, 9 months).

80. Thus, some of the indicative sentences are potentially supportive of the contention advanced by the applicant.

81. However, the principal focus under a ground of manifest excesses, as earlier discussed, is whether the aggregate sentence reflects the totality of the criminality involved. I will return to that consideration at the conclusion of the consideration of the remainder of the errors relied upon by the applicant and in the context of considering the ground of the appeal per se. Two aspects of the Crown’s submissions are worthy of note, however, at this juncture.

82. First, as to counts 11 and 12, there is an apparent inconsistency because the offences occurred close in time and fraud involving a smaller sum of money receives a significantly higher penalty. However, the indicative sentences may be properly reconciled upon the basis that the offending in count 12 occurred only 3 days after the offending in count 11. In other words, the serious offending involved in count 11 was repeated (again with a large sum of money) only a short time later.

83. Secondly, it is apparent that many of the “inconsistent” indicative sentences referred to above were substantially subsumed, by the operation of the totality principle, having regard to the fact that count 18 involved an indicative sentence of 6 years and 4 months (for an offence in mid-2016) and count 24 an indicative sentence of 5 years 9 months (for an offence in late 2017).

84. It may be observed that the applicant did challenge the use of Form 1 sequences attaching to counts 18 and 29 and argued that the indicative sentences for those offences was excessive. However, the applicant only challenged other indicative sentences taking into account other matters on a Form 1 faintly in oral argument and without any basis being identified for why the application of Form 1 offences in reaching an indicative sentence for those counts was erroneous or produced an excessive indictable sentence.

85. Overall, I will find, for reasons further discussed below, that inconsistencies in indicative sentences do not lead to a conclusion that the aggregate sentence is manifestly excessive.

Count 29: Assessment of Objective Seriousness

Submissions of the Parties

86. The applicant submitted in written submissions that the sentencing judge was in error in the assessment of objective seriousness of the offending for counts 18 and 29 as ‘above the mid-range’. In the Reasons For Sentence, (at p 17) the sentencing judge stated that:

[Count 18] and [count 29] involved very serious offending, above the mid-range of objective seriousness, approaching the higher end of that range I must say. The other sequences given the motive, the amounts that were involved and the steps taken by the offender to achieve the result that he wanted to achieve, generally fall around the midrange of objective seriousness.

87. This categorisation of the offence for count 29, it was submitted, gave rise to two issues. First, the applicant submitted that the sentencing judge arrived at this determination from the accumulated quantum of the fraud of the indictable offence plus the quantum of fraud of the 24, smaller, Form 1 matters. When taking into account the Form 1 offences, the quantum of the fraud exceeded $1 million. It was submitted that the indictable offences of count 29 and each of the associated Form 1 offences were not above the mid-range. No further submissions were directed specifically to count 18. Secondly, the applicant submitted that the offences identified as being of mid-range seriousness should have attracted similar indicative sentences.

88. In support of these submissions, the applicant made reference to various passages from the Guideline Judgment at [21] – [23], [33] and [34].

89. The Crown submitted that there was no error in the reasoning of the sentencing judge as to the assessment of objective seriousness. It was submitted that both of the counts for challenged indicative sentences were the most serious offences – count 18 totalled to $1,747,729.20 when all the Form 1 offences were taken into account and count 29 involved the second highest quantum when taking into account all the Form 1 offences, being $1,102,301.

Conclusion: Objective Seriousness

90. The applicant relied upon various passages from the Guideline Judgment in support of this contention, which in my view do not adequately capture the gravamen of the reasoning by the Chief Justice in that judgment. The relevant passages bearing upon the present contention (none of which were referred to by the applicant) are found at paragraphs [18], [23]-[24], [39]-[44] and are in the following terms:

[18] A number of propositions with respect to the process of taking into account matters on a Form 1 are well established and are uncontroversial. First, the entire point of the process is to impose a longer sentence (or to alter the nature of the sentence) than would have been imposed if the primary offence had stood alone. Secondly, it is wrong to suggest that the additional penalty should be small. Sometimes it will be substantial. (See e.g. The Queen v White (1981) 28 SASR 9 at 13; Murrell v The Queen (1985) 4 FCR 168 at 179 per Blackburn J; R v Vougdis (1989) 41 A Crim R 125 at 128-129; R v Morgan (1993) 70 A Crim R 368 at 371-372.)

…

[23] The Court must, of course, give effect to the statutory regime. However, it does so in a context in which the basic principle of the common law is that no-one should be punished for an offence of which he or she has not been convicted. (The Queen v De Simoni (1981) 147 CLR 383 at 389, 395-396; The Queen v Olbrich (1999) 199 CLR 270 at [18].) The offences on a Form 1 constitute an admission of guilt, but there is no conviction.

[24] The ‘top down’ approach which, notionally, identifies an appropriate penalty for the full gamut of offences, appears to me to be inconsistent with this principle. No doubt it can be said that even the ‘bottom up” approach involves, in a sense, punishment ‘for’ the Form 1 offences, because the penalty for the primary offence is increased. (See e.g. R v Anderson [1978] AC 964 at 969 per Lord Diplock.) But that is not necessarily the case, as I sought to show in R v Barton (2001) 121 A Crim R 185 at [64].) (Lord Diplock’s observations were appropriately qualified by Neasey J in R v Jones [1978] Tas SR 126 at 131.) …

…

[39] The sentencing court is sentencing only for the “principal offence”. It is no part of the task of the sentencing court to determine appropriate sentences for offences listed on a Form 1 or to determine the overall sentence that would be appropriate for all the offences and then apply a “discount” for the use of the procedure. This is not sentencing for the principal offence.

[40] In my opinion, it is pertinent to identify the elements to be considered in determining the sentence for the primary offence upon which the commission of other offences, for which no conviction is being recorded, may impinge. The case law has identified a number of distinct and sometimes overlapping purposes to be served by sentencing. In my opinion, not all these purposes are relevant to the process of taking other offences into account, when sentencing for a particular offence, i.e. the primary offence.

[41] In Barton at [64], in a passage subsequently referred to in R v AEM Snr at [81] and R v Perese at [81], I made some observations which I repeat.

[42] The position, in my opinion, is that, although a court is sentencing for a particular offence, it takes into account the matters for which guilt has been admitted, with a view to increasing the penalty that would otherwise be appropriate for the particular offence. The Court does so by giving greater weight to two elements which are always material in the sentencing process. The first is the need for personal deterrence, which the commission of the other offences will frequently indicate, ought to be given greater weight by reason of the course of conduct in which the accused has engaged. The second is the community’s entitlement to extract retribution for serious offences which there are offences for which no punishment has in fact been imposed. These elements are entitled to greater weight than they may otherwise be given when sentencing for the primary offence. There are matters which limit the extent to which this is so. The express provision in s 33(3) referring to the maximum penalty for the primary offence is one. The principle of totality is another.

[43] I did not intend these observations to be exhaustive of the elements upon which the fact of other offences may impinge. However, no additional elements for which that could be so have been identified in submissions to this Court. The important point is that the focus throughout must be on sentencing for the primary offence.

[44] The manner and degree to which the Form 1 offences can impinge upon elements relevant to sentencing for the principal offence will depend on a range of other factors pertinent to those elements and the weight to be given to them in the overall sentencing task. For that reason it will rarely be appropriate for a sentencing judge to attempt to quantify the effect on the sentence of taking into account Form 1 offences. (See R v Kay at [69].) The Crown was also correct to point, in my view, to the judgment Higgins v R [2020] NSWCCA 169 at [77]-[78] where it was held that whilst the sentencing judge was bound to assess the objective seriousness of the offending, the placement of an offence on a notional scale is “neither precise nor prescriptive”.

91. Even if the assessment of the objective seriousness of each count were confined to the money sum the subject of the fraud, as contended by the applicant, it is clear that the offending in counts 18 and 29 represent, independently of the Form 1 offending, the most serious offences for which the applicant was convicted.

92. Given that the applicant directed little attention in support of this contention to count 18 (no doubt because that count concerned a fraud involving an amount above $1 million) attention may be focused upon count 29. The Crown is correct to submit that the submissions by the applicant do not make clear why the sentencing judge’s findings on objective seriousness as to this offence were not open. Certainly, his Honour’s Reasons for Sentence are not on their face demonstrative of error.

93. It is implicit in the applicant’s submissions that his Honour sentenced the offender as if the principal offence involved a money sum in the frauds of over $1 million by incorporating the sums involved in the Form 1 offences in the assessment of the principal offence. It is not suggested by the applicant what role the Form 1 offences should have played in the assessment of the indicative sentences.

94. In my view, the applicant’s submission in this respect misunderstands (or misapplies) the principles in the Guideline Judgment (as set out above) which permit the offences on a Form 1 to result in a longer sentence, even a substantial one, consistently with the community’s entitlement to extract retribution for serious offending, when there are other offences for which no punishment has been imposed (Guideline Judgment at [44]). The Form 1 offences attached to count 29 represent not only a large number of offences for which the applicant has pleaded guilty of the kind represented by count 29 itself but a substantial number of overall offences occurring much later in the cycle of offending by the applicant. They involve, of course, a substantial sum of money that was the subject of fraud.

95. The assessment of the objective seriousness of an offence is quintessentially a matter for the sentencing judge: Lees v R [2019] NSWCCA 65 at [55]; Mulato v R [2006] NSWCCA 282 at [46]. As earlier mentioned in the discussion of principles generally, when dealing with a manifest excess ground of an appeal, the sentencing judge has as much flexibility as is consonant with a consistency of approach and application of principle.

96. Having regard to the gravity of the offending in count 29 and taking into account the Form 1 offence in this fashion, it was open to his Honour to conclude that count 29 was above the midrange of objective seriousness although it was not necessarily a conclusion he was required to reach: DH v R [2022] NSWCCA 200 (per Harrison J at [33], Fagan J at [56] and Yehia J at [60]).

97. I reject the second contention put forward by the applicant.

The Starting Point was too High

98. The total term sentence of 13 years imprisonment incorporated a 25% discount. It was submitted by the applicant that the sentencing judges starting point must have been 17 years and 4 months, which sentence demonstrated manifest excess. It was also submitted that the non-parole period of 8 years did not properly account for the “excellent subjective features” and the finding of special circumstances.

99. As Mr Smith SC appropriately conceded, the attribution of a notional starting point (having regard to a discount for a plea) to an aggregate sentence is erroneous. The discount for the plea of guilty afforded to the applicant in this case, of 25%, was to be applied to the indicative sentences and not the aggregate sentence.

100. The applicant made an alternative submission that the variation in the indicative sentences might indicate that the discounts have been applied wrongly, although it is not clear how that submission was advanced in support of this contention, additionally, that is, to the other contentions advanced by the applicant with respect to the indicative sentences.

101. Reference might also be made in this respect to the line of authority to the effect that it is “neither appropriate nor helpful to take an assumed starting point of sentence as a basis upon which to argue that a sentence is manifestly excessive”: see Hayek at [90] and see Piscitelli v R [2013] NSWCCA 8 at [91] and the cases cited therein, Tassis v The Queen [2017] NSWCCA 143 at [29] to [30], Adzioski v R [2013] NSWCCA 69 at [72] and R v Hopkinson, R v Robertson [2022] NSWCCA 80 at [96].

102. In this matter, in bringing a manifest excess ground the applicant needed to demonstrate that the aggregate sentence imposed was unreasonable or plainly unjust. This, as I will discuss below, is ultimately not sustainable with respect to the aggregate sentence imposed, in a case where the applicant defrauded 90 victims of a sum of over $6.5 million over a period of five years, even putting aside other aspects of the offending which elevate the objective seriousness of the offending.

103. Further, I accept the submission of the Crown that it is plain that the sentencing judge applied the principle of totality and brought the overall sentence down by a significant amount allowing for a substantial degree of notional concurrency. The notional accumulation on the top of the longest indicative term was modest.

104. I reject this contention.

No Misapplication of principles concerning prior good character

Submissions for the Applicant

105. By reference to the passage of the Reasons for Sentence at page 16, the applicant submitted that the sentencing judge did not give “sufficient weight, if any at all”, to the applicant’s prior good character, notwithstanding that the sentencing judge had found that the applicant had an excellent subjective case, was unlikely to reoffend, was not a risk to the community and was engaged in rehabilitating himself.

106. After referring to the judgment of this Court in R v Smith (2000) 114 A Crim R 8; [2000] NSWCCA 140, the applicant also placed reliance upon the principles enunciated in Ryan v The Queen (2001) 206 CLR 267; [2001] HCA 21 (“Ryan”) (in particular, the judgments of McHugh J and Kirby JJ). It was contended that McHugh J held in Ryan that the Court must first determine that the offender is otherwise of good character and must not consider the offences for which he was convicted in that respect.

107. The applicant contended that the sentencing judge fell into error by finding the applicant’s prior character had “evaporated” due to the commission of the offences for which the applicant was being sentenced. Thus, while the sentencing judge referred to the applicant’s prior good character, he erred, it was submitted, by devaluing the applicant’s prior good character to “nothing” when making that observation.

Conclusion: Good Character

108. It should be observed at the outset that in Ryan, the sentencing judge had found that the appellant was otherwise a person of good character but that, in the circumstances of that matter, it was found the appellant should be given no leniency whatsoever for his otherwise good character. This was because, in the view of the sentencing judge, while the appellant was a priest who had done good things, “he was not a good man”, due to his offending: see at [19], [26] and [35] per McHugh J. It was held that the NSW Court of Criminal Appeal should have allowed the appeal and resentenced the applicant because there was an error in not attributing any weight to the appellants otherwise good character (at [35]).

109. In that light, McHugh J observed there was a two-stage process for the use of character evidence in the sentencing process as follows (at [23] and [25]):

[23] It is necessary to distinguish between the two logically distinct stages concerning the use of character in the sentencing process. First, it is necessary to determine whether the offender is of otherwise good character. When considering this issue, the sentencing judge must not consider the offences for which the prisoner is being sentenced. Because that is so, many sentencing judges refer to the offender's “previous” or “otherwise” good character.

…

[25] Second, if the offender is of otherwise good character, it is necessary to determine the weight that must be given to that mitigating factor. If an offender is of otherwise good character, then the sentencing judge is bound to take that into account in the sentence that he or she imposes. The weight that must be given to the prisoner's otherwise good character will vary according to all of the circumstances.

110. In considering whether the appellant in Ryan was of good character, McHugh J made the following observations (at [29]):

[29] In the trial context, an accused's “good character” may be relevant because it may tend to prove that the accused is unlikely to have committed the crime in question, as committing the offence would have been “out of character”. In the sentencing context, however, being of otherwise good character may in some circumstances suggest that the prisoner's actions in committing the offence for which he or she is being sentenced were “out of character” and that he or she is unlikely to re-offend. For that purpose, the absence of previous convictions is usually regarded as evidence of good character. On the other hand, many previous convictions suggest that the offence for which sentence is being passed was not an “uncharacteristic aberration”.

111. In considering whether the sentencing judge erred by not giving the appellant “any leniency” whatsoever because of his otherwise character, McHugh J stated at [33] and [34]:

[33] Sentencing is not a mathematical process. Various factors have to be weighed. The otherwise good character of the prisoner is one of them. It is a mitigating factor that the sentencing judge is bound to consider. But the nature and circumstances of the offences for which he or she is being sentenced is a countervailing factor of the utmost importance. The nature of the offences for which the appellant was being sentenced meant that his otherwise good character could only be a small factor to be weighed in the sentencing process.

[34] First, there were multiple offences involving repeated acts committed over a number of years. They were not isolated incidents which might be said to be out of character. Second, the appellant was, as his counsel conceded before Judge Nield, leading a double life. Over many years, the appellant was doing “good works” while he was committing grave offences. This contradiction indicates that the appellant's otherwise good character was a minor factor to be weighed. Third, the appellant committed the offences in the course of his priestly duties and it was as a priest that he did the “good works” which are at the heart of his claim of good character. This reduces the weight that ought to be given to his otherwise good character. Fourth, and related to the third point, the offences involved breaches of trust.

112. There are two fundamental problems with the applicant’s contentions in this respect.

113. The first is that the applicant is incorrect to submit that the sentencing judge devalued the applicant’s prior good character to “nothing”, when he said that “character evaporated when the first offence was committed.” A fair reading of his Honour’s judgment as a whole illustrates that the sentencing judge did give leniency for the applicant being of otherwise good character. At pages 9 and 10 of the Reasons for Sentence, his Honour recognised that the applicant expressed his willingness to undertake community service work, was a low risk of reoffending and was at the time when he first started to offend, a person of good character who was well thought of by those who knew him. His Honour also took into account testimonials in favour of the applicant in considerable detail and stated, in that light, “so clearly he has support from those who have provided the testimonials and the level of support is to be taken into account, particularly having regard to any prospects of rehabilitation…”

114. Later in the Reasons for Sentence, after the passage relied upon by the applicant, his Honour took into account that the applicant did not have any criminal record and stated “and certainly prior to the offending was a person of good character. I certainly agree that he is unlikely to reoffend.” There is no indication that this finding was limited to any degree.

115. It follows that this matter may be distinguished from the judgment in Ryan as the sentencing judge did take into account that the applicant was otherwise of good character.

116. It is not entirely clear that this contention relied upon insufficient weight being given to the applicant’s good character. In any event, there was a sound basis for his Honour to reduce the significance of this factor in mitigation. There was a pattern of repeat offending over a significant period of time and general deterrence was obviously important in the sentencing of the applicant: Ryan at [34] and R v Gent (2005) 162 A Crim R 29; [2005] NSWCCA 370 (“Gent”) at [52] (per Johnson J with whom McClellan CJ at CL and Adams J agreed) (citing R v Kennedy [2000] NSWCCA 527). I also consider there is force in the proposition in Gent at [59] that, that less weight should be given to prior good character in respect of white-collar offences such as the present, as such offences are rarely committed by people with a criminal history.

117. I reject this final contention.

The Manifestly Excessive Ground

118. Having dispensed with what were, in their nature, patent errors, I return to consider the actual single ground of appeal.

119. Whilst the sentence imposed upon the applicant is relatively high, I do not consider that the sentence imposed may be described as manifestly excessive, having regard to the principles for the determination of that question earlier set out in this judgment.

120. The applicant defrauded 90 victims of $6.7 million over five years. The motive was clearly greed, as the luxurious lifestyle he was able to lead went well beyond any concerns he could have had about supporting his family financially. At the time of his arrest, the applicant had made provision for further fraud of a substantial magnitude which he intended to use. He plainly intended to continue to defraud investors.

121. Additionally, there was a degree of planning involved, having elements of sophistication which involved the forging of signatures and the identification of maturity dates for investments. There was a breach of trust with respect to the applicant’s employer.

122. Overall, the applicant was engaged in a very serious, systematic course of criminal conduct involving fraud. It is not diminished because of the white-collar nature of the crime and significant emphasis was required to be given to general deterrence and the denunciation of the conduct.

123. Further, as earlier mentioned, it is evident from the indicative sentences that the sentencing judge applied the principle of totality and brought the overall sentence down significantly by allowing for a substantial degree of notional concurrency.

124. The very favourable conclusion by the sentencing judge as to the applicant’s subjective factors cannot overpower the significance of those objective factors and issues of deterrence. I have also had regard to the discount provided by the sentencing judge.

125. The applicant relied upon the sentence in R v Clarke [2019] NSWDC 2 (16 January 2019) (“Clarke”) as a comparative case providing an indication that the sentence imposed was manifestly excessive. Reference was made to ongoing frauds totalling over $9 million in that case by a solicitor defrauding clients by falsely advising them to deposit their funds into the law firm’s trust account. It was contended that the Clarke case and the applicant’s case were quite similar with regard to the method of defrauding persons, but the applicant’s frauds were substantially less than in Clarke.

126. However, I accept a submission by Ms Wilkins SC for the Crown, to the effect that the offender in Clarke received a lesser sentence than the applicant is not indicative that the applicant’s sentence is manifestly excessive. I also accept that one sentence, or even a number of sentences involving the same or similar offences cannot establish sentencing range: Upadhyaya at [75] (per Campbell J with whom Latham J agreed) (Leeming JA agreed with the outcome, providing different reasons).

Conclusion

127. For the foregoing reasons, I consider that the single ground of appeal of manifest excess should be rejected and the appeal dismissed. Having regard to the various considerations raised in dealing with the applicant’s appeal during the course of this judgment, it is appropriate that leave to appeal be granted.

127. I note that a considerable amount of evidentiary material was filed in the appeal by the applicant, involving, inter alia, the circumstances affecting the applicant after his arrest. However, this material was introduced only on the usual basis and does not affect the disposition of this appeal in circumstances where this ground of appeal is rejected.

Orders

129. I propose the following orders:

1. Leave to appeal is granted.

2. The appeal is dismissed.

130. DAVIES J: I agree with Walton J. I also agree with the additional remarks of the Chief Justice.

Annexure 1

*********

Decision last updated: 17 May 2023