Kerin v The Queen

[2022] SASCA 19

Supreme Court of South Australia

(Court of Appeal: Criminal)

KERIN v THE QUEEN

[2022] SASCA 19

Judgment of the Court of Appeal  

(The Honourable Justice Doyle, the Honourable Justice David and the Honourable Justice Nicholson)

17 March 2022

CRIMINAL LAW - APPEAL AND NEW TRIAL - PROCEDURE - POWERS OF COURT ON APPEAL - POWER TO ORDER NEW TRIAL OR QUASH CONVICTION AND DIRECT ENTRY OF VERDICT OF ACQUITTAL - GENERAL PRINCIPLES

CRIMINAL LAW - APPEAL AND NEW TRIAL - PROCEDURE - POWERS OF COURT ON APPEAL - POWER TO ORDER NEW TRIAL OR QUASH CONVICTION AND DIRECT ENTRY OF VERDICT OF ACQUITTAL - WHERE NEW TRIAL ORDERED

CRIMINAL LAW - PARTICULAR OFFENCES - PROPERTY OFFENCES - THEFT - GENERALLY

On 21 February 2014, following a trial by judge alone, the appellant was convicted of two counts of theft, contrary to s 134 of the Criminal Law Consolidation Act 1935 (SA). The appellant appealed against his conviction on five grounds. The application for permission to appeal was over seven years out of time. Therefore, the appellant required an extension of time to appeal his convictions.

On appeal, the respondent conceded both the application for an extension of time and the appeal on Ground 5 in relation to both counts. Ground 5 alleged that a miscarriage of justice occurred because fresh evidence, not available to the appellant at trial, would likely have affected the verdicts. Accordingly, it was not necessary for this Court to consider the merits of the other grounds of appeal.

The remaining issue is whether the Court should direct verdicts of acquittal to be entered or order a new trial.

Held, per the Court, allowing the appeal on Ground 5:

1.      The appellant is granted an extension of time within which to seek permission to appeal.

2.      The convictions on Counts 1 and 2 are quashed.

3.      A new trial is ordered on Counts 1 and 2.

4.      The compensation order made by the trial Judge on 11 June 2014 is untouched.

Criminal Law (Sentencing) Act 1988 (SA) s 53; Criminal Law Consolidation Act 1935 (SA) s 134; Criminal Procedure Act 1921 (SA) s 158; Evidence Act 1929 (SA) ss 34CB, 34P; Powers of Attorney and Agency Act 1984 (SA) s 7, referred to.
Anderson v The Queen (1991) 53 A Crim R 421; Andrews v The Queen (1968) 126 CLR 198; Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627; Gerakiteys v The Queen (1984) 153 CLR 317; Gilham v The Queen (2012) 224 A Crim R 22; Jiminez v The Queen (1992) 173 CLR 572; King v The Queen (1986) 161 CLR 423; Peacock v The King (1911) 13 CLR 619; R v Drummond (No 2) [2015] SASCFC 82; R v Kerin [2014] SASC 19; R v Leak [1969] SASR 172; R v Taufahema (2007) 228 CLR 232; Reid v The Queen [1980] AC 343; The Queen v Slobodian (1982) 30 SASR 161, considered.

KERIN v THE QUEEN
[2022] SASCA 19

Court of Appeal – Criminal:    Doyle, David JJA and Nicholson AJA

THE COURT:

1. On 21 February 2014, following a trial by judge alone, the appellant, Mr Peter David Kerin, was convicted of two counts of theft, contrary to s 134 of the Criminal Law Consolidation Act 1935 (SA). On 11 June 2014, he was sentenced to three years and six months imprisonment with a non-parole period of one year and nine months. He was released on parole on 11 March 2016. Pursuant to s 53 of the Criminal Law (Sentencing) Act 1988 (SA) (as it then applied), the appellant was ordered to pay compensation in the sum of $253,540 (being the sum of $285,000 less $31,460, which was paid by the appellant prior to sentencing). He has since paid $135,000 of that sum.

2. The appellant appealed against his conviction on the following grounds: the trial Judge gave himself inadequate directions and reasons as to the use of evidence of subsequent conduct in relation to Count 1, discreditable conduct evidence in relation to Count 2, and the relevance of a loan agreement between Osvest Pty Ltd (‘Osvest’) and Ms Fahey in relation to all counts (Ground 1); the trial Judge made an error of law by using discreditable conduct evidence in relation to Counts 2 and 3 when not satisfied of its admissibility in accordance with s 34P(2)(a) of the Evidence Act 1929 (SA) (Ground 2); the verdict on Count 2 was not supported by judicial reasoning in relation to the consent and dishonesty elements of the charged offence (Ground 3); there was a miscarriage of justice caused by defence counsel’s failure to call a relevant witness at trial (Ground 4); and a miscarriage of justice occurred because fresh evidence, not available at trial, was likely to have affected the verdicts (Ground 5). The application for permission to appeal is over seven years out of time. Therefore, the appellant requires an extension of time to appeal his convictions.

3. On the appeal, the respondent conceded both the application for an extension of time and the appeal on Ground 5 in relation to both Counts 1 and 2.  Accordingly, it was not necessary for this Court to consider the merits of the other grounds of appeal.  The Court granted the extension of time, allowed the appeal on Ground 5, and quashed the convictions on Counts 1 and 2.

4. The remaining issue is whether the Court should direct verdicts of acquittal to be entered or order a new trial.  In considering this issue it is necessary to say something briefly about the offences with which the appellant was charged.

5. The appellant was charged with three counts of theft.

6. Count 1 related to funds of $200,000 belonging to Ms Fahey.  The prosecution alleged that between 21 September and 2 October 2007, the appellant (who was a co-donee under a power of attorney from Ms Fahey) withdrew funds from an investment in Ms Fahey’s name with AXA and deposited them into Osvest’s bank account for the purpose of trading in derivatives.  The prosecution case was that the appellant did so to advance the interests of Osvest (of which the appellant was the Chief Operations Officer and in which he had a prospective financial interest).  It was alleged that whilst the appellant was purportedly exercising his powers under the power of attorney, he was in fact acting in the interests and for the purposes of Osvest and himself, rather than Ms Fahey. Alternatively, the prosecution alleged that the appellant was not acting with reasonable diligence to protect the interests of Ms Fahey within the meaning of
   s 7 of the Powers of Attorney and Agency Act 1984 (SA).

7. Counts 2 and 3 were charged on alternative bases.  They related to transactions between 10 January and 22 February 2008, whereby the appellant allegedly dealt with property beneficially owned by the estate of Ms Fahey (Ms Fahey having died on 26 November 2007) (‘Count 2’).  Alternatively, the property allegedly dealt with by the appellant was beneficially owned by the Batten estate (‘Count 3’).  The prosecution alleged that this property was used for the general purposes of Osvest.  It was alleged that the appellant dealt with the property subject of Counts 2 and 3 dishonestly and knowingly without the consent or authority of the owners.

8. The appellant gave evidence at trial. The defence case in respect of Count 1 was that whilst the appellant accepted that he dealt with the property of Ms Fahey in the manner alleged by the prosecution, he did not act without the owner’s consent because he had the consent of his father who gave that consent as a donee under the power of attorney.  Alternatively, the defence case was that: he acted within the legal power conferred upon him by the power of attorney; or, he was acting in the interests and for the purposes of Ms Fahey and he exercised reasonable diligence to protect the interests of Ms Fahey; or, he honestly believed he had the owner’s consent.

9. As to Count 2, the defence case was that the share trading assets as at January/February 2008 were not beneficially owned by the Fahey estate.  The appellant gave evidence that there had been an ‘exchange’ effected on 8 October 2007, pursuant to which Ms Fahey’s beneficial interest in the share trading assets was converted into a beneficial interest in a $100,000 loan to Sigma Alpha Group Limited (‘SAGL’), the subject of a convertible note.  The Batten estate’s interest in $100,000 in Osvest’s bank account, which was to be lent to SAGL, was converted into a beneficial interest in or loan funding the share trading assets.

10. The appellant gave evidence that there was a telephone meeting late in the evening on 8 October 2007 between himself and Mr Williams (the sole director of Osvest) at which it was resolved to make the exchange (the ‘exchange meeting’). The appellant prepared minutes of the meeting (Trial Exhibit PP20, Appeal Exhibit A1) and a declaration of trust by Osvest in favour of Ms Fahey in respect of the loan to SAGL and convertible note (Trial Exhibit PP21, Appeal Exhibit A2) (the ‘exchange documents’). The appellant said he posted them under cover of a letter to Mr Williams dated 10 October 2007, with a post-it note requesting Mr Williams to date them 12 October 2007.  It was put to the appellant in cross‑examination that the exchange did not occur and the exchange documents were actually created by him in June 2008 and backdated to October 2007 when he realised that he had no legal authority to move the funds held beneficially by Ms Fahey or her estate. That proposition was later repeated in the prosecutor’s written submissions and during his closing address.

11. As to Count 3, the defence case was that the share trading assets as at January/February 2008 were beneficially owned by Osvest and not the Batten estate because the relationship between them was one of debtor and creditor, not trustee and beneficiary, due to a loan agreement entered between them dated 4 October 2007.  The appellant denied that he dealt with funds beneficially owned by the Batten estate.  Rather, the appellant submitted that he acted in accordance with authority conferred upon him by the executor of the Batten estate, to whom probate had been granted.  Alternatively, the appellant submitted that he honestly believed that he had the executor’s consent and did not act dishonestly.

12. It can be seen that an issue at trial in respect of Count 2 was whether there was a meeting on 8 October 2007 during which the ‘exchange’ took place, as reflected in the exchange documents, or whether the idea of the exchange did not occur to the appellant until June 2008, at which time the exchange documents were created and backdated to October 2007.  The trial Judge found: there was no meeting on 8 October 2007; there was no exchange in October 2007 as purportedly reflected in the exchange documents; the exchange documents were not created until June 2008; and the appellant backdated the documents to October 2007.[1]  The trial Judge set out his basis for so finding in his reasons for verdict. His Honour said: ‘In a negative sense, there is no objective contemporaneous evidence independent of evidence given or documents later produced by the accused which evidences that an Exchange took place in October 2007.’[2]

    [1]     R v Kerin [2014] SASC 19 at [323].

    [2]     R v Kerin [2014] SASC 19 at [209].

13. The trial Judge ultimately found that he was ‘unable to accept the accused as a witness of truth’.[3]  This finding was made partly on the basis that he disbelieved the appellant’s evidence that there was an exchange meeting on 8 October 2007 and the exchange documents were created contemporaneously or shortly after that meeting.

    [3]     R v Kerin [2014] SASC 19 at [192].

14. On appeal, the appellant sought to rely on an affidavit of Michael Jenkin who analysed computer hard disk drives containing electronic versions of the exchange documents.  At the appeal hearing, the respondent produced a document entitled ‘Statement of Agreed Facts’ (Appeal Exhibit A3).  In this document, the respondent concedes that the metadata associated with the exchange documents supports the contentions that the file named ‘Minutes’ (identical to Exhibit Trial PP20 – except unsigned) was created on 9 October 2007 and the convertible note issued by SAGL (identical to Trial Exhibit PP21) was created on 10 October 2007. The respondent acknowledged that the electronic files were in the possession of the police and the Office of the Director of Public Prosecutions and had been disclosed to the appellant’s solicitors at the time of trial.  However, the electronic materials were disclosed as part of a voluminous amount of material and neither party appreciated the contents of the electronic files.  Accordingly, the prosecutor at trial cross-examined the appellant on an incorrect basis and put the prosecution case in a manner inconsistent with the electronic data he unknowingly had in his possession.  Further, the trial Judge relied on the prosecutor’s submissions and cross-examination of the appellant (which were inconsistent with the material in the DPP’s possession) in making adverse findings against the appellant in respect of the exchange and the appellant’s credibility.  The adverse findings as to the appellant’s credibility also infected his conviction on Count 1.  For those reasons, the respondent conceded the appeal on Ground 5 in respect of both Counts 1 and 2.  The Court was prepared to act upon the respondent’s concession; allowing the appeal and quashing the convictions on Counts 1 and 2.

15. The appellant seeks that verdicts of acquittal be entered pursuant to s 158(3) of the Criminal Procedure Act 1921 (SA) (‘CPA’), whereas the respondent contends that the Court should order a new trial. The power to order a new trial is enlivened by a determination of this Court that an appeal against conviction be allowed in accordance with s 158(1) of the CPA.  The power, upon being enlivened, is discretionary.  The onus is on the prosecution to satisfy the Court that a new trial should be ordered.[4]  The primary consideration is whether it is in the interests of justice for a new trial to be had.[5]  The relevant principles as to whether an appellate court should order an acquittal or a new trial are well settled.[6]

    [4]     King v The Queen (1986) 161 CLR 423 at 426 per Murphy J.

    [5]     Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627 at 630; Peacock v The King (1911) 13 CLR 619 at 675 per O’Connor J; Anderson v The Queen (1991) 53 A Crim R 421 at 453 per Gleeson CJ (with whom Finlay J and Slattery AJ agreed); R v Leak [1969] SASR 172 at 176 per Bray CJ, Hogarth and Walters JJ; The Queen v Slobodian (1982) 30 SASR 161 at 167–8 per King CJ (with whom Legoe and Mohr JJ agreed).

    [6]     Peacock v The Queen (1911) CLR 619 at 641 per Griffith CJ, at 675 per O’Connor J; Andrews v The Queen (1968) 126 CLR 198 at 211; Gerakiteys v The Queen (1984) 153 CLR 317 at 321 per Gibbs CJ (with whom Wilson J agreed); Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627 at 630–1. See also R v Taufahema (2007) 228 CLR 232; R v Drummond (No 2) [2015] SASCFC 82; Gilham v The Queen (2012) 224 A Crim R 22.

16. The appellant relies on the following matters in submitting that it is appropriate for this Court to order acquittals on Counts 1 and 2: the alleged offences are not of the most serious kind (as compared with the offence of murder, for example); the prosecution case, it is said, is not insurmountable; the period of time that has elapsed since the alleged offending, approximately 15 years; the appellant has been tried twice and had two successful appeals; the appellant has already served his sentence and completed his parole period; and on a retrial the prosecution would be required to run a substantially different case on Count 2.  The appellant concedes that the prosecution would not be required to present a substantially or radically different case on Counts 1 and 3.  The appellant also submitted that his sworn undertaking not to seek an order annulling the compensation order made on 11 June 2014 was a factor to be considered by the Court in the exercise of its discretion whether to order a new trial.

17. As to the submission that the prosecution would be required to run a substantially different case on Count 2, the appellant does not suggest this would amount to a ‘new case’ but nonetheless submits that the prosecution would be presenting a markedly different case in a material aspect at a new trial.  This is because of the significance attached by the prosecution to the submission that the exchange documents were backdated.  The prosecution would no longer be able to rely on the alteration of the documents to establish that the ‘exchange’ had not occurred.  Nor would the prosecution be able to use the alleged alteration of the documents to undermine the appellant’s credibility on all counts at a new trial.

18. Notwithstanding the matters raised by the appellant, we consider it is appropriate in this case to order new trials on Counts 1 and 2.  The difference in relation to the prosecution case to be presented on Count 2 at a new trial will be confined to challenging the veracity of the exchange meeting whilst accepting the exchange documents were created in and around 8 October 2007.  The prosecution is not proposing to put a significantly different case to the jury; it will simply no longer be able to rely on the exchange documents having been backdated to challenge the occurrence of the exchange meeting.  That change is not a substantial one, particularly as it was part of the prosecution case at the last trial that should the Court be satisfied that there was a lawful exchange, then the alternative count (Count 3) fell to be considered by the Court.  Nor does the change in the prosecution case on Count 2 materially weaken the strength of the case against the appellant.  There is still sufficiently cogent evidence upon which a jury could reasonably convict.

19. The charges involve serious allegations of theft by which vulnerable members of the community were exploited by an experienced solicitor.  Any forensic disadvantage to the appellant brought about by delay and associated matters may be the subject of a forensic disadvantage direction.[7]

    [7]     Evidence Act 1929 (SA) s 34CB.

20. There are factors present in this case that, conventionally, would tend to militate against an order for a new trial.  We have not overlooked the fact that the appellant has served his sentence.[8]  The appellant has also endured two lengthy trials the subject of successful appeals.[9]  However, in the circumstances of this case, and for the reasons already outlined, notwithstanding those factors, we are satisfied it is in the interests of justice to order a new trial on Counts 1 and 2.

    [8]     See, eg, Jiminez v The Queen (1992) 173 CLR 572 at 590 per McHugh J.

    [9]     See, eg, Reid v The Queen [1980] AC 343 at 350.

21. Of course, whether the Director of Public Prosecutions does in fact proceed with a new trial is a matter for his prosecutorial discretion, to be exercised having regard to considerations such as those summarised above.

    Orders

22. The appellant is granted an extension of time within which to seek permission to appeal.  The appeal is allowed on Ground 5. The convictions on Counts 1 and 2 are quashed.  A new trial is ordered on Counts 1 and 2.  The orders disposing of the appeal leave untouched the compensation order made by the trial Judge on 11 June 2014.