Koch v The Queen

[2011] VSCA 435

SUPREME COURT OF VICTORIA
COURT OF APPEAL

S APCR 2010 0284

CHRISTOPHER PHILIP KOCH	Appellant
	v
THE QUEEN	Respondent

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JUDGES	MAXWELL P, BUCHANAN and NEAVE JJA
WHERE HELD	MELBOURNE
DATE OF HEARING	3 May 2011
DATE OF JUDGMENT	15 December 2011
MEDIUM NEUTRAL CITATION	[2011] VSCA 435
JUDGMENT APPEALED FROM	R v Koch (Unreported, County Court of Victoria, Judge Douglas, 22 July 2010)

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CRIMINAL LAW – Appeal – Conviction – Obtaining property by deception, obtaining a financial advantage by deception – Post-offence conduct – Flight – Whether admissible – Whether referable to some or all of the offences charged – Whether jury direction appropriate – Jury discharge applications rejected – Whether high degree of necessity – Whether miscarriage of justice – Application refused.

CRIMINAL LAW – Appeal – Conviction – Making available a prescribed interest – Single count substantiated by multiple instances of fraud – Whether duplicitous – Purported interest fictitious – Whether possible to ‘make available’ – Conviction quashed – Corporations Law s 1064, Corporations Act 2001 (Cth) s 1401.

CRIMINAL LAW – Appeal – Sentence – Obtaining property by deception (15 counts), obtaining financial advantage by deception (7 counts) – Total effective sentence 13y 2m, non-parole period 10y – Continuing criminal enterprise offences – Doubling of applicable maximum – Whether individual and overall sentences manifestly excessive – Importance of consistency in sentencing – Relevance of amounts defrauded – Appeal allowed – Resentenced – Total effective sentence 9y 10m, non-parole period 7y 6m.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr M Croucher with Ms C Boston	Dean Cole & Associates
For the Crown	Mr D Gurvich	Commonwealth Director of Public Prosecutions

MAXWELL P:

1 Following a trial in the County Court, the applicant was convicted of 15 counts of obtaining property by deception, seven counts of obtaining a financial advantage by deception and one count of making available a prescribed interest, contrary to s 1064 of the Corporations Law.[1]  He was sentenced as follows:

[1]Taken to be included in the Corporations Act 2011 (Cth) by virtue of s 1401 of that Act.

Count	Offence	Maximum	Sentence	Cumulation
1.	Obtaining property by deception	10y	3y	5m
2.	Obtaining financial advantage by deception	10y	3y	5m
3.	Obtaining property by deception	10y	1y	1m
4.	Obtaining property by deception	10y	5y	6m
5.	Obtaining property by deception	10y	5y	6m
6.	Obtaining property by deception	10y	3y	5m
7.	Obtaining property by deception	10y	15m	—
8.	Obtaining financial advantage by deception	20y (continuing criminal enterprise)[2]	5y	6m
9.	Obtaining financial advantage by deception	20y (continuing criminal enterprise)	6y	Base
10.	Obtaining financial advantage by deception	20y (continuing criminal enterprise)	3y	5m
11.	Obtaining financial advantage by deception	20y (continuing criminal enterprise)	3y	5m
12.	Obtaining property by deception	10y	1y	1m
13.	Obtaining property by deception	10y	1y	1m
14.	Obtaining property by deception	10y	1y	1m
15.	Obtaining property by deception	10y	6m	–
16.	Obtaining property by deception	10y	20m	2m
17.	Obtaining financial advantage by deception	20y (continuing criminal enterprise)	3y	5m
18.	Obtaining property by deception	20y (continuing criminal enterprise)	3y	5m
19.	Obtaining property by deception	10y	18m	2m
20.	Obtaining property by deception	10y	2y	3m
21.	Obtaining property by deception	10y	3y	5m
22.	Obtaining financial advantage by deception	10y[3]	3y	5m
25.	Make available a prescribed interest contrary to s 1064 of the Corporations Law	5y	2.5y	12m[4]
TES			13y 2m
NPP			10y

[2]As the sentencing judge noted in her reasons, each of counts 8 to 11, 17 and 18 was a continuing criminal enterprise offence, as it involved an amount of $50,000 or more and was committed after 1 July 2008. Pursuant to ss 6H and 6I of the Sentencing Act1991 (Vic), therefore, the maximum penalty for each offence was 20 years.

[3]The return of prisoners indicates that the applicant was sentenced on this count on the basis that it was a continuing criminal enterprise offence.  However, this appears to have been an error, as count 22 involved an amount less than $50,000.

[4]Pursuant to s 15 of the Sentencing Act 1991 (Vic), the applicant was ordered to serve the sentence on count 25 first. The sentencing judge further ordered that after 12 months of the sentence was served, the applicant be released upon entering a recognisance release order in the sum of $1,000 and on the condition he be of good behaviour, pursuant to s 20(1)(b) of the Crimes Act 1914 (Cth). The State sentences commenced immediately upon the completion of the pre-release period of the Commonwealth sentence.

2  The offences were committed over a period of three years, between December 1996 and December 1999.  During this period, the complainants transferred funds to the applicant on the faith of his representation that the funds would be invested in an ‘investment opportunity … which involved or was linked to a high yield investment scheme’. 

3  The investment scheme did not exist.  An assistant governor of the Reserve Bank gave evidence at the trial that ‘high yield investment schemes did not exist and are a scam’.  The funds were, in fact, deposited in National Australia Bank accounts controlled by the applicant, either in his own name or in the name of Koch & Associates Pty Ltd.  A short time after each deposit, the funds were withdrawn by one or other of the following methods:  cash withdrawals, cheques written out to be paid in cash, cheques endorsed to pay bills, and transfer of funds to another bank account controlled by the applicant.  The funds were not invested but were used by the applicant for personal and business expenses and for gambling.

4  The total amount the subject of counts 1 to 22 was $992,000, of which $31,000 was ultimately repaid.  The transactions the subject of count 25 include those to which counts 1 to 22 relate, together with additional transactions totalling $590,000.  The total value of the transactions underlying count 25 was therefore $1,582,000.

5  The applicant now seeks leave to appeal against conviction and against sentence.  For reasons which follow, I would allow the conviction appeal in relation to count 25, but otherwise dismiss that appeal and I would allow the appeal against sentence.

CONVICTION APPEAL

Ground 1:  flight evidence and consciousness of guilt

6  On 7 June 2001, a search warrant was executed at the applicant’s home by officers of the Australian Securities and Investment Commission and the Australian Federal Police.  Relevant documents were seized.  The applicant was informed that a formal investigation would be conducted and that he would be invited to participate in a formal interview.  On 13 July 2001, the applicant left Australia.  He did not return until he was extradited from New Zealand more than five years later. 

7  After a lengthy pre-trial voir dire, the trial judge ruled that the prosecution was entitled to rely on the evidence of the applicant’s departure, and extended absence from Australia, as capable of amounting to evidence of flight and – hence –  as an implied admission of guilt.  The applicant contends that the evidence of flight should not have been left to the jury and that there has been a miscarriage of justice. 

8  According to the submission, it was not open to the jury, on either the civil or the criminal standard of proof, to exclude the possibility that the applicant ‘fled’ for one or more of the following reasons:

(a)       in order to avoid the civil consequences of transactions forming the basis of the charged acts;

(b)      in order to avoid potential criminal prosecution for conduct which did not become the subject of any charge;  or

(c)       for some other innocent reason, such as to fulfil overseas speaking commitments or to find employment.

9  The prosecution case was that the applicant was in financial difficulty.  There was evidence that, at various times over the three years preceding the applicant’s departure from Australia, complainants had been pursuing him for repayment of amounts they had paid.  The contention for the applicant was that, because some of the money owed to the complainants was not the subject of charged offences, the possibility could not be excluded that he had left Australia in order to avoid civil action for recovery of moneys (whether the subject of transactions giving rise to charges or otherwise).  For similar reasons, it was said, the possibility could not be excluded that he was seeking to avoid potential criminal prosecution for conduct which was not the subject of any of the charges before the Court.  It was pointed out that the transactions which gave rise to the charges, and those which did not, ‘occurred at different times and in different circumstances over a period of about three years’.

10  Particular attention was also drawn to the offence in count 25, which involved no proof of deception or dishonesty.  The prosecutor in his final address, when dealing with that count, conceded that there was some evidence that the applicant ‘was worried that ASIC might have been on to him about Goldview being an unregistered investment scheme.’  According to the written submission:

Flight evincing a belief in criminal wrongdoing of the type alleged in count 25 or of the type implicit in uncharged acts cannot be a consciousness of guilt of any of the charged acts in counts 1 to 22.  In those circumstances, the evidence of flight could not be used safely to infer a consciousness of guilt in respect of each particular count under consideration:  R v Laz.[5]

[5][1998] 1 VR 453, 467–8 (‘Laz’).

11  These submissions must be rejected, in my view.  There was no error in the decision to admit the evidence of flight.  My reasons are as follows.

The evidence of flight was admissible

12  Post-offence conduct is a species of circumstantial evidence.  Accordingly, as this Court made clear in R v Ciantar,[6] the question for a trial judge, when considering whether to leave evidence of post-offence conduct to the jury, is whether that evidence ‘is capable, in conjunction with other evidence, of sustaining an inference of consciousness of guilt of the charged offence.’

[6](2006) 16 VR 26, 48–49 [72] (‘Ciantar’).

13  It is no bar to admissibility that the particular conduct may have been engaged in for more than one reason.  In the present case, the existence of alternative – or additional – possible explanations for the applicant’s flight did not render the evidence incapable of supporting an inference of consciousness of guilt.  That would only have been so if one (or more) of the alternative explanations had been so inherently likely that the jury could not reasonably have excluded the possibility that there was a wholly innocent explanation for the conduct.[7]

[7]Ibid 42 [52], 48–49 [72].

14  The same view has been taken in other jurisdictions.  In R v Power,[8] Doyle CJ said that evidence of flight was not inadmissible simply because a credible explanation was advanced.  With the concurrence of Millhouse and Williams JJ, his Honour approved the following statement of Shepherdson J in R v Melrose:

[W]hen there is evidence of flight before a jury whether there be one or more than one reason advanced for that flight, the jury should be told that it is for them to decide on the whole of the evidence relevant to the charge in which evidence of flight has been admitted what inference is to be drawn from the accused person’s flight but that if at the end of the day they decide to infer a consciousness of guilt in the accused person for the offence alleged, they must be satisfied beyond reasonable doubt of such an inference.[9]

This approach was subsequently endorsed by the New South Wales Court of Criminal Appeal in R v Ho[10] and, later, by this Court in Ciantar.[11]

[8](1996) 87 A Crim R 407, 409 (‘Power’).

[9][1989] 1 Qd R 572, 579 (emphasis added).

[10](2002) 130 A Crim R 545, 556 [52], (Bell J, with whom Meagher JA and Hidden J agreed).

[11](2006) 16 VR 26, 44–45 [59].

15  The alternative explanations advanced on behalf of the applicant were neither ‘ludicrous [nor] obviously false’[12] but that did not render the evidence incapable of supporting an inference of consciousness of guilt.  Flight can be left as consciousness of guilt if it is open to the jury to be satisfied beyond reasonable doubt that the defendant’s awareness of his guilt of the offences was one reason for the flight, even if there were others.  It has never been suggested that consciousness of guilt has to be the sole reason for the conduct in question in order for the evidence to be left to the jury. 

[12]Power (1996) 87 A Crim R 407, 409.

16  An ‘alternative explanation’ which would prevent the evidence being admitted is an innocent explanation which would wholly explain the flight.  It is only if it would not be reasonably open to the jury to reject an innocent explanation of that kind that the flight evidence would be inadmissible.  This is just an example of the general approach to circumstantial evidence. 

Consciousness of guilt of less than all of the counts on the indictment

17  In the alternative, the applicant contended that the flight evidence should not have been left to the jury because the possibility could not be excluded that the evidence related to something less than all of the offending.  For the evidence to be left in those circumstances would, it was said, constitute unfairness.

18  Reliance was placed on the decision in R v Hartwick.[13]  That was an appeal against conviction for an armed robbery committed on 13 May 1993 (the ‘first robbery’).  Evidence had been led at the trial to show the offender’s flight from an attempt to arrest him on 1 June 1993.[14]  At an earlier trial for a different armed robbery, committed on 29 May 1993 (the ‘second robbery’), the Crown had relied on the same evidence of flight to demonstrate the applicant’s consciousness of guilt of that (second) robbery. 

[13](Unreported, Supreme Court of Victoria, Court of Appeal, Charles, Callaway JJA and Vincent AJA, 20 December 1995) (‘Hartwick’).

[14]There was other consciousness of guilt evidence led (namely, threats made to a witness in a letter dated 23 August 1993, written after the applicant’s arrest for the second robbery) which could relate only to the second robbery and not the first.  This evidence was not relevant to the 13 May 1993 robbery and was not properly admitted at trial.  The flight evidence did not have this character – the flight evidence could have related to either or both robberies.

19  The Court (Callaway JA[15]) held that the evidence of flight, which had been used in the earlier trial to demonstrate the applicant’s consciousness of guilt of the second robbery, could not be used in a subsequent trial to demonstrate his consciousness of guilt of the first robbery.  The Court rejected a submission by the Crown that the flight evidence might demonstrate a consciousness of guilt of both robberies and that, as the evidence was clearly admissible, the question of whether or not it should go to the jury should be analysed in terms of the judge’s discretion to exclude it if its prejudicial character outweighed its probative value.

[15]With whom Charles JA and Vincent AJA agreed.

20  Even if the evidence of flight might have demonstrated a consciousness of guilt of both robberies, the Court said, it was not possible to exclude the reasonable hypothesis that the flight demonstrated a consciousness of guilt of the second robbery alone.[16]  It would, moreover, be unfair to require the applicant to explain his flight to the jury in the later trial, as this could only be done by reference to the second robbery.  Callaway JA said:

For such material to be used to demonstrate a consciousness of guilt in a case such as the present, the jury must be satisfied that the conduct of the accused cannot be explained by any other reasonable hypothesis.Here there was another reasonable hypothesis, namely that the conduct evinced a consciousness of guilt of the other armed robbery.  The prosecuting authorities themselves had used it for that very purpose at the earlier trial, but the jury at this trial could not be informed of the other armed robbery nor could the applicant be expected to put it in evidence to rebut the inference of consciousness of guilt of the offence with which he was charged.  The direction, which his Honour correctly gave, that the jury had to be satisfied that the cause of the applicant’s fleeing and hiding in the cupboard was his desire to escape the consequences of this offence and not the consequences of some other wrongdoing has a hollow ring.  Both the Court and the Crown knew, as the jury could not, that there was other wrongdoing and that it might reasonably explain the applicant’s conduct.

…

He could not be expected to inform the jury that he had recently been convicted of a similar offence.  It was quite unlike the position where, for example, it is suggested that incriminating conduct may be explained by panic or confusion or the desire to protect a third party.[17]

[16]         Hartwick (Unreported, Supreme Court of Victoria, Court of Appeal, Charles, Callaway JJA and Vincent AJA, 20 December 1995), 2.

[17]Ibid (emphasis added).

21  The applicant’s submission also relied on Laz.[18]  That was an appeal against a conviction on one count of rape by digital penetration and one count of rape by penile penetration.  In his record of interview, the accused had denied any sexual contact with the complainant.  When the accused gave evidence at the trial, however, he admitted the digital penetration but not the penile penetration.  The judge had left the accused’s lies (about digital penetration) to the jury as indicating consciousness of guilt of both counts.  He had, moreover, failed to identify the lies precisely, referring only to the accused’s general denial of sexual contact. 

[18]         Laz [1998] 1 VR 453.

22  The Court said:

[V]ery special problems arise when the same lie and thus the same consciousness of guilt is argued to be applicable to charges arising out of more than one event.  The applicant had been apprehended and what he feared, and thus what may have given rise to an inference of consciousness of guilt, could not and cannot be satisfactorily identified.  It cannot be left in the air, for the inference must be of a kind which logically excludes all other reasonable possibilities.  That cannot be done in the present case and thus, whatever directions may have been given to the jury, the admitted lies could not have formed a proper basis for implying consciousness of guilt in respect to either count.  It is conceivable that he feared detection on both counts; it is conceivable that he feared detection on the more serious count; it is conceivable that he feared detection on the lesser count; it is conceivable that he feared merely that the bringing of charges and exposure to prosecution would become known amongst his family and friends, notwithstanding his denying the truth of the allegations.  In other words this was not a safe case to let any lie admitted or otherwise go to the jury as amounting to consciousness of guilt and thus as an implied admission of one or both of the counts charged.[19]

[19]Ibid 467–468 (Ormiston, Charles JJA and Vincent AJA).

23  Plainly enough, there is no analogy between either of those cases and the present.  Hartwick and Laz were both particular applications, in very particular circumstances, of the general principles applicable to the admissibility of circumstantial evidence. 

24  The present case is quite different.  It was common ground that, if the applicant’s flight was capable of supporting an inference of consciousness of guilt, that inference applied equally to all of the charged conduct.  No distinction could be drawn for this purpose between one count and another.

25  There was no unfair prejudice in allowing the evidence to go to the jury.  Unlike the applicant in Hartwick, the applicant in this case had no reason not to give – and indeed, gave – an innocent explanation for his behaviour.  It was, appropriately, a matter for the jury to decide which of the explanations for the applicant’s behaviour should be believed and what, if anything, should be concluded as a result.   

The adequacy of the jury directions

26  It follows from what I have said regarding the first part of this ground that the complaint about the judge’s direction to the jury must also be rejected.  There was no occasion for the jury to be directed to consider whether the evidence of flight related to one or other of the offences charged.  As I have said, it was common ground on the appeal that no distinction could be drawn for this purpose between one count and another. 

27  Her Honour’s charge set out clearly, and very fairly, the matters of which the jury needed to be satisfied before they could use the evidence of flight as the basis for inferring an admission of guilt.  Her Honour said, in part:

[Y]ou must be satisfied that the reason why the accused acted in that way was because he believed that he had committed the crime that you are considering or some aspect of it and he believed that he would be implicated in the crimes if he did not act in that way.  Note when I say the law is [that] the accused must have believed that he committed the crime or crimes you are considering, by that the law does not mean that he must have believed he had committed a specific crime alleged in the count as it is known to the law.  What is meant is that he must have believed he had … committed the wrongful conduct which constitutes that crime or crimes and was trying to avoid the legal consequences of that unlawful behaviour by acting in the way he did …

28  Her Honour was at pains to emphasise that the jury could only use the evidence in that way if they were satisfied beyond reasonable doubt that he had fled for that reason:

This requirement will only be met if you are satisfied that no explanation for the accused’s conduct is reasonably open on the facts other than [that] he believed that he had committed the crime you are considering or some aspect of it and he believed that by not acting in the way he did, he would be implicated in it.  If it is reasonably possible that the accused acted for another reason, you cannot use his conduct as evidence that he implicitly admitted responsibility for that crime.

29  This ground fails.

Ground 2:  failure to discharge jury

30  The applicant argues that the jury should have been discharged for two reasons.  The first was that the applicant had been asked in cross-examination whether he had ever gone by an assumed name, ‘Robinson’.  The second was that a juror had allegedly called the applicant a ‘dirty lying c…t’ while he was giving evidence.

31  Where complaint is made on appeal about a trial judge’s refusal to discharge the jury, the question to be determined is whether the failure to discharge occasioned a miscarriage of justice.[20]  In my view, no miscarriage of justice resulted here.  Neither of the matters relied on gave rise to the ‘high degree of necessity’ which must be shown before a jury discharge is warranted.[21]

[20]R v Ferguson (2009) 24 VR 531, 581–2 [255]–[258].

[21]R v Halliday (2009) 23 VR 419, 436 [65].

32  When the prosecutor asked the applicant whether he had ever used the assumed name, he answered in the negative.  The matter was not further pursued.  The mere suggestion that the applicant might have used a false name – which, of course, he denied – carried no such inherent prejudice as to require a discharge of the jury or – more relevantly for present purposes – as to occasion a miscarriage of justice.  It is overwhelmingly likely, in my view, that the jury viewed this matter as of no consequence in the circumstances of a long and complicated trial.

33  As to the remark allegedly made by the juror, her Honour dealt with the issue appropriately.  Her Honour had only the applicant’s assertion that the remark had been made.  There was nothing else to corroborate its making.  The judge herself had not heard any such remark, nor had either counsel.  Nor could any sound be detected when the video-recording of the relevant part of the hearing was viewed in the absence of the jury.   

34  In the presence of the jury, her Honour chose her words carefully, saying that she had not reached a conclusion ‘as to who said what, if anything was said and what took place’.  The course adopted was calculated to give the issue minimal significance in the overall scheme of the trial.  There is no basis for the contention that her Honour conveyed to the jury that she disbelieved the applicant.   

35  Even assuming in the applicant’s favour that the statement had been made, I do not think it showed any bias.  The position is different from that in R v Giles,[22] where a juror had expressed a very hostile view towards the accused after having heard only the Crown opening.  Even there the complaint of bias failed.  Herring CJ said:  ‘[I]t appears [the juror] was just thinking aloud, and I suppose jurymen are allowed to do a little thinking even though it may be desirable on occasions that they should not do it aloud’. 

[22][1959] VR 583.

36  In the present case, the juror was simply reacting to what he/she had heard in the witness box.  It was not a sign of pre-judgment or animus against the applicant.  Rather it was the – admittedly unusual – articulation of the kind of view which jurors are not only likely to form during the giving of evidence but are expected to form.  After all, one of their crucial tasks is to assess the credibility of the witnesses they hear.

37  This ground fails.

Ground 3:   count 25 – duplicity

38  Ground 3 was in these terms:

The verdict on count 25 is unreasonable or otherwise amounts to a miscarriage of justice;  and in particular the count is duplex and/or the verdict is uncertain given that (i) multiple transactions over a three-and-a half year period – some of which concerned the transactions in the other counts, some of which did not – were left to the jury in proof of the count, (ii) the prosecution did not elect as to which of those transactions were relied on, (iii) the judge did not direct the jury that they had to be unanimous as to any or all of those transactions and (iv) the verdict does not disclose which transactions formed the verdict.

39  At the hearing, counsel for the applicant was given leave to add the following additional ground of appeal regarding count 25:

The verdict on count 25 is unreasonable or cannot be supported having regard to the evidence and in particular, it was not open for the jury to be satisfied beyond reasonable doubt that the applicant ‘made available’ a ‘prescribed interest’, because on the evidence and on the Crown case there was no ‘actual, prospective or contingent interest’ being made available.

40 In my view, both grounds are made out. I would set aside the conviction on this count. Dealing first with duplicity, count 25 alleged that the applicant had been complicit in the conduct of his company in ‘making available’ a prescribed interest. The substantive offence is established by s 1064(1) of the Corporations Law,[23] which provides:

(1) A person, other than a public corporation, must not make available, offer for subscription or purchase, or issue an invitation to subscribe or buy, any prescribed interest.

[23]Taken to be included in the Corporations Act 2001 (Cth) by s 1401 of that Act.

41  In proof of this single count, the Crown relied on multiple transactions over a three-and-a-half year period.  As noted earlier, some of the transactions related to counts 1 to 22 and some did not.  As the judge said quite explicitly in her charge to the jury, the Crown case was that, on each occasion when the applicant’s company invited a person to take part on the investment scheme, the company had made available ‘a right to participate in any profits … of any financial or business undertaking’.  No direction was given, however, that the jury had to be unanimous in relation to any individual transaction said to support the count. 

42  On the appeal, counsel for the Crown (who did not appear at the trial) contended that what count 25 alleged, in substance, was that there had been a single ‘making available’ of a prescribed interest, of which the offers to individual potential ‘investors’ were merely evidence.  In the alternative, he contended, an analogy might be drawn with what is known as a Giretti count of carrying on the business of drug trafficking.[24]

[24]See R v Giretti (1986) 24 A Crim R 112.

43  It is unnecessary to consider whether a case might have been presented in either of those alternative ways.  As already pointed out, it is simply not how the case against the applicant was conducted.  Rather, each offer to a potential ‘investor’ was said to constitute the ‘making available’ of a prescribed interest by the company, in relation to which the applicant’s complicity had to be established.  In other words, this single count concealed a large number of individual counts.

44  As to the second ground, the circumstances of the case were such that no count of this kind was maintainable in any event.  On the Crown’s case, the ‘participation interest’ which the applicant’s company was purportedly ‘making available’ did not exist.  It was a sham.  It follows, therefore, that the company could not have committed the offence of ‘making available a prescribed interest’ and that the applicant could not have been complicit in any such offence.  (Conduct of this kind could, presumably, be dealt with as misleading or deceptive conduct.)

SENTENCE APPEAL

45  The success of the appeal against conviction on count 25 makes it unnecessary to deal with the first ground of appeal against sentence, which concerns double punishment.  To the extent that count 25 was based on transactions which were the subject of the individual dishonesty counts 1 to 22, this ground would inevitably have succeeded.  As the case was presented to the jury, the conduct on the applicant’s part which was said to constitute complicity in the company’s conduct towards those complainants was the very conduct said to make him liable as a principal for obtaining financial advantage by deception.  On the principles clearly enunciated by the High Court in Pearcev The Queen,[25] those matters should have formed no part of count 25. 

[25](1998) 194 CLR 610.

46  The quashing of the conviction on count 25 means that this Court must resentence the applicant on the remaining counts.  It is not, therefore, necessary to address ground 2, which contends that the sentences, both individually and as cumulated, and the non-parole period, are manifestly excessive and in breach of totality.  The arguments advanced do, nevertheless, shed light on the resentencing task. 

47  As to the individual sentences, it was said to be apparent that the sentence differentials between one count and another depended, principally at least, upon the amount of money dishonestly obtained.  According to the submission:

[W]hilst it is not the only relevant consideration in determining the seriousness [of] offences of this nature, the amounts of money involved simply do not justify the individual sentences imposed.  For example, the sentences on count 6 (6 years’ imprisonment – $250,000), counts 4, 5 and 8 (5 years’ imprisonment – $100,000 — $130,000) and counts 1, 2, 6, 10, 11, 17, 18, 21 and 22 (3 years’ imprisonment – $40,000 — $60,000) are all extremely high.  Sentences in the order of half or two-thirds the length of those sentences would be consistent with current sentencing practices and all other relevant considerations.

48  As to the total effective sentence, the submission for the applicant drew attention to a series of decisions of this Court on appeals against sentence for systematic dishonest conduct of this kind.  In the table attached to these reasons, I have sought to isolate the key features of those cases, so that a meaningful comparison can be made with the sentences imposed in the present case. 

49  On the appeal, counsel for the Crown submitted that the cases relied on were of little assistance because, in each of them, the offender had pleaded guilty and had, to a greater or a lesser extent, exhibited remorse for the dishonest conduct.  In the present case, as the sentencing judge noted, the applicant had pleaded not guilty and had vigorously contested the charges.  There was, accordingly, no evidence of remorse, and no discount was available for a plea of guilty.  I return to these issues below.

50  As to the non-parole period, counsel for the applicant pointed out that the Crown’s submission to the sentencing judge was that the sentencing range reasonably available in the circumstances of the case was a head sentence of between nine and 12 years’ imprisonment, and a non-parole period of between six and eight years.  As counsel pointed out, the non-parole period fixed by the judge was well above the top end of that range. 

Sentencing reasons

51  In her reasons for sentence, the judge rejected a defence submission that the applicant should be sentenced on the basis that, when he committed the offences, he did not know that the representations he was making were false but that they were ‘probably false’.  In her Honour’s view, that submission was inconsistent with the position adopted by the defence during the trial.  Accordingly, her Honour sentenced the applicant on the basis that, on each occasion, the representation made by the applicant to the prospective investor was knowingly false.  There is no challenge to that finding. 

52  Her Honour said:

Relevant sentencing considerations for offences of dishonesty which involve deception include a combination of just punishment, general and specific deterrence, the denunciation by the court of the dishonest practices involved in the offending, as well as matters put on your behalf including rehabilitation.  The Court of Appeal has made it clear that the sentencing factors of general and specific deterrence, together with a requirement for strong denunciation of the conduct involved in the offending, carry a significant amount of weight in this type of offending, which is often referred to as ‘white collar crime’ and I have done so. 

Each case, of course, depends on its own facts and circumstances.  These offences were carried out in a sophisticated manner, in that each was well-planned and carried out by you skilfully.  You well know you had the talent to persuade others, as indicated by your successful career in sales and public speaking.  The people whom you convinced to transfer funds to you considered you to be a well-informed, successful businessman with an international reputation who had the opportunity to be in contact with people involved in international finance.  Some of the complainants were friends who had known you over a period of time, and others whom you would have considered to be less sophisticated in business affairs, but all were susceptible to your powers of persuasion. 

Your plea of not guilty and the matters with which you took issue indicate that your position is not only that you are not guilty of deception, but also there was no scam involved.  This indicates a lack of insight into the situation.  In those circumstances, I have given a considerable amount of weight to specific deterrence to deter you, who have been found guilty of serious offences committed over a considerable period which were carefully planned and carried out skilfully. 

53  As noted earlier, six of the 15 counts were continuing criminal enterprise (‘CCE’) offences.  They carried a maximum penalty of 20 years’ imprisonment, double that which applies to the other counts.  Her Honour said:

As your offending was carried out in the same manner throughout this period, I have not imposed a higher sentence in relation to the counts which are a continuing criminal enterprise, solely on that basis.  I have sentenced you in relation to all counts on the indictment, taking into account the same criteria, as I consider it would be artificial and unfair in the circumstances to do otherwise.

54  I note in this regard that, with the exception of count 9 on which the applicant was sentenced to six years’ imprisonment, the longest term of imprisonment imposed on any individual count was five years.  That was the sentence imposed on counts 4 and 5, which were not CCE offences, and on count 8, which was.

Consideration

55  In my respectful opinion, the sentencing judge’s summary of the applicable sentencing considerations was entirely correct.  As her Honour pointed out, this Court has repeatedly emphasised the significance of general deterrence in sentencing for offending of this character.[26]  Likewise, in view of the applicant’s plea of not guilty, lack of remorse and lack of insight, considerable weight needed to be given to specific deterrence and protection of the community. 

[26]See, for example, R v Kinnear [2009] VSCA 104, [24]–[25]; Yusuf v The Queen [2010] VSCA 266, [27] (‘Yusuf’).

56  Consideration of the comparable cases set out in the table, however, leads me to conclude that both a number of the individual sentences and the total effective sentence and non-parole period are outside the available range.  As the High Court has restated emphatically in recent days, consistency in the punishment of offences ‘is a fundamental element in any rational and fair system of criminal justice’.[27]  Like offenders should be treated alike.[28]  Consistency is to be achieved by the application of the appropriate range, and it is in the determination of the range that comparable cases can be of particular assistance.[29] 

[27]Green v The Queen [2011] HCA 49, [28] (French CJ, Crennan and Kiefel JJ).

[28]Ibid.

[29]Hudson v The Queen (2010) 205 A Crim R 199, 206–7 [27]–[29]; Hasan v The Queen [2010] VSCA 352, [47]–[52].

57  The fact of the applicant’s not guilty plea was, of course, a very significant point of distinction between this case and the cases summarised in the table.  But there was nothing about the applicant’s fraudulent conduct which made it objectively more grave than that of the offenders dealt with in those cases. 

58  The most obvious point of difference between the present case and those in the table works to the applicant’s advantage.  By reference both to the total amount defrauded and to the number of victims affected, the scale of the applicant’s fraud was substantially smaller than that in any of the other cases.  While, as counsel for the applicant properly conceded, the amounts involved are not determinative of sentence, they are – for good reason – of very great significance in determining the appropriate sentence.  This is so, at least in part, because the quantum provides some real indication of the measure of loss and damage, both financial and psychological, caused to the victims of the frauds.  A review of the decisions in the table confirms that relativities between amounts defrauded, both as between different victims of the same offender and as between different offenders, have a direct bearing on sentencing differentials.

59  The sentence of five years on each of counts 4 and 5 – which involved, respectively, amounts of $110,000 and $130,000 – was outside the range, in my view.  It is well above any single count sentence imposed for a comparable amount in the cases reviewed.  In R v Roussety,[30] for example, the individual sentences were in the following range:

[30](2008) 24 VR 253.

·$100,000 — $200,000:  2 years;

·$300,000 — $400,000:  3 years;

·$500,000 — $1,000,000:  4 years.

A sentence of five years was reserved for the largest single fraud, involving $5,000,000.  Moreover, as Nettle JA pointed out in that case,[31] there is a need for moderation of individual sentences in cases of multi-count offending, in order to comply with the requirements of totality and avoid a crushing sentence.

[31]Ibid 274 [50].

60  For completeness, I should add that my conclusion on the manifest excess ground was in no way dependent on the fact that the total effective sentence and the non-parole period fixed by the judge were above the upper limit of sentencing range put forward by the prosecutor.  By itself, that is a matter of no consequence.  A submission on range is just that, a submission.  Clearly, as the Court (Ashley and Weinberg JJA) said recently in Bogdanovich v The Queen,[32] a judge is under no obligation to impose a sentence that falls within the sentencing range advanced by the Crown.  Nor, if sentence is imposed outside that range, does the judge have to explain why that course was adopted.

[32][2011] VSCA 388, [93].

Personal circumstances

61  The applicant’s personal circumstances were set out in the sentencing reasons. The relevant features may be summarised as follows.  The applicant is now 61.  He has raised two children ‘as a caring and attentive father’.  One of them gave evidence on the plea.  Although divorced, he continued to maintain his children financially and enjoys a close relationship with them, although his relationship with his son has been adversely affected by the publicity in relation to this offending.  The judge took into account that this had caused the applicant considerable distress. 

62  He is an intelligent and educated man.  After completing Year 12, he undertook a three-year course in art and design at the Caulfield Institute of Technology.  Throughout his life, he has been successful in his own businesses and in the various positions he has held, particularly in sales.  He has had a reputation as a talented public speaker, and was often engaged to provide motivational talks to successful and well respected public companies. 

63  His second wife developed breast cancer after he and she had separated.  To the applicant’s credit, he continued to assist her with treatment, and moved in with her to facilitate her care until the time of her death. 

64  The applicant has done valuable community service.  He has assisted the Alannah and Madeline Foundation, which helps children from families where there is drug addiction.  He has also been a contributor to the Lighthouse Foundation, which included leasing a vehicle for the purpose of taking children to school.  A number of references were tendered on his behalf and the judge accepted – as do I – that the applicant is held in high regard not only by his family but by the community. 

65  Finally, the applicant has not enjoyed good health.  He had open heart surgery in 1988.  In 1999 an angiogram indicated that the graft was doing well but that some blockages still existed.

66  He has no prior convictions.

Resentencing

67  I would therefore resentence the applicant as set out in the table below.

Count	Offence	Amount	Maximum	Sentence	Cumulation
1.	Obtaining property by deception	$40,000	10y	2y	4m
2.	Obtaining financial advantage by deception	$50,000	10y	2y	4m
3.	Obtaining property by deception	$15,000	10y	1y	1m
4.	Obtaining property by deception	$110,000	10y	3y	6m
5.	Obtaining property by deception	$130,000	10y	3y	6m
6.	Obtaining property by deception	$60,000	10y	2y	4m
7.	Obtaining property by deception	$20,000	10y	1y	1m
8.	Obtaining financial advantage by deception	$100,000	20y	3y 6m	6m
9.	Obtaining financial advantage by deception	$250,000	20y	4y	Base
10.	Obtaining financial advantage by deception	$50,000	20y	2y	4m
11.	Obtaining financial advantage by deception	$50,000	20y	2y	4m
12.	Obtaining property by deception	$12,000	10y	1y	1m
13.	Obtaining property by deception	$10,000	10y	1y	1m
14.	Obtaining property by deception	$10,000	10y	1y	1m
15.	Obtaining property by deception	$5,000	10y	6m	–
16.	Obtaining property by deception	$12,500	10y	1y	1m
17.	Obtaining financial advantage by deception	$50,000	20y	2y 6m	5m
18.	Obtaining property by deception	$50,000	20y	2y 6m	5m
19.	Obtaining property by deception	$20,000	10y	2y	4m
20.	Obtaining property by deception	$30,000	10y	2y	4m
21.	Obtaining property by deception	$40,000	10y	2y	4m
22.	Obtaining financial advantage by deception	$25,000	10y	2y	4m
TES			9y 10m
NPP			7y 6m

SENTENCING FOR MAJOR FRAUD:  COMPARABLE CASES

PLEA	RELEVANT PRIORS	AMOUNT DEFRAUDED	NATURE AND DURATION OF FRAUD	INDIVIDUAL COUNTS	TES	NPP	COMMENT
R v Shannon [2005] VSCA 143	G	N	$7m Small impact on individual victims.	Bogus raffles. Six years.	18m–3y	7y 4m	5y	‘Fraudulent conduct on a very large scale’ [9]. Strong remorse and prospects of rehabilitation [8]–[9].
R v Fernandez [2006] VSCA 38	G	Y	$10m (30 rolled-up counts).	Stamp duty. Three years.	2y–6y (A sentence of 6y was imposed on only one count, which involved more than $2m).	10y	7y	Clear breach of position of trust [21].
R v Roussety (2008) 24 VR 253	G	N	$3.2m (net) (49 separate offences, 12 victims).	Investment scam. Five years.	6m–5y	11y 1m	7y	‘Sustained, systematic defalcation’ [7]. Excellent prospects of rehabilitation and profound remorse [52]. TES ‘well within the range’ [41].
R v Kinnear [2009] VSCA 104	G	Y	$2.2m.  ‘Severe’ harm to victims.	Loan and investment frauds. Seven years.	6m–3y	8y	4y 9m	Offender had depression (Verdins 5). Sentence under appeal (TES 11y 4m, NPP 8y 6m) ‘significantly outside the range’ [24].
Yusufv The Queen [2010] VSCA 266	G	N	$5.6m (109 victims).	Investment scam. Several years.	1y–4y (Sentences of 3y 6m and above imposed on only three counts out of 126, all CCE offences).	12y	9y	‘Fraud writ large’ [30]. TES and NPP ‘within range’ [34]. Substantial lack of remorse. Poor prospects of rehabilitation.
APPLICANT	NG	N	$992,000 (22 separate offences).	Investment scam. Three years.	1y–5y	13y 2m	10y

BUCHANAN JA:

68  I agree with the President.

NEAVE JA:

69  I have had the advantage of reading the draft reasons of Maxwell P.  I agree with his Honour, for the reasons he gives, that leave to appeal against conviction should be granted in respect of count 25.  In respect of that count, I agree that the appeal should be allowed, the conviction set aside and a verdict of acquittal be entered.  I agree that leave to appeal against conviction should otherwise be refused.  I also agree that the appeal against sentence should be allowed and the applicant resentenced in the manner that his Honour proposes.

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