Leckie v Department of Human Services - [2012] SASC 197

SUPREME COURT OF SOUTH AUSTRALIA
(Magistrates Appeals: Civil)
LECKIE v DEPARTMENT OF HUMAN SERVICES
[2012] SASC 197
Judgment of The Honourable Justice Stanley
7 November 2012
MAGISTRATES - APPEALS AND REVIEW - SOUTH AUSTRALIA - APPEAL TO SUPREME COURT
CRIMINAL LAW - SENTENCE - RELEVANT FACTORS
SOCIAL WELFARE - OFFENCES - FALSE STATEMENTS AND FRAUD - PENALTY
Appellant pleaded guilty in the Magistrates Court to five counts of obtaining a financial advantage from a Commonwealth entity contrary to s 135.2(1) of the Criminal Code (Cth) - appellant was sentenced to nine months imprisonment, to be released after serving two months imprisonment, upon entering into a recognisance to be of good behaviour for 12 months - the magistrate further ordered reparation of the full amount - appellant contends that sentence is manifestly excessive and seeks to have the sentence set aside.
Held: Appeal allowed - sentence set aside - appellant resentenced to nine months imprisonment, but the appellant is to be released forthwith upon entering into a recognisance bond in the sum of $500 to be of good behaviour for 12 months, and reparation of the full amount is to be made - magistrate erred by failing to give consideration, or at least proper consideration, to the appellant's rehabilitation, and in requiring the appellant to serve part of the term of imprisonment there was a miscarriage of justice - magistrate failed to properly regard the interests of society and of the appellant in her rehabilitation - requiring the appellant to serve the sentence imposed would have put her at risk of losing her employment, which would have thrown her back onto the social security system - appellant is most unlikely to reoffend.
Criminal Code (Cth) s 135.2; Crimes Act 1914 (Cth) s 16A, referred to.
R v Ferrer-Esis (1991) 55 A Crim R 231, applied.
Markarian v The Queen (2005) 228 CLR 357; Dinsdale v The Queen (2002) 202 CLR 340; Kovacevic v Mills (2000) 76 SASR 404, discussed.

LECKIE v DEPARTMENT OF HUMAN SERVICES
[2012] SASC 197
STANLEY J:
Introduction

This is an appeal against sentence.
The appellant, Emma Leckie, pleaded guilty in the Magistrates Court to five counts of obtaining a financial advantage from a Commonwealth entity contrary to s 135.2(1) of the Criminal Code (Cth) (the Code).
The respondent is the Department of Human Services. Pursuant to statute the respondent provides various allowances and benefits where claimants meet prescribed criteria.
The offences relate to the appellant fraudulently taking advantage of allowances offered by the respondent from a period between 11 September 2008 and 3 May 2011, namely the Newstart Allowance and the Disability Support Pension.
The amount of overpayment from the respondent to the appellant totalled $50,236.23.
The magistrate convicted the appellant and sentenced her to nine months imprisonment, to be released after serving two months imprisonment, upon entering into a recognisance to be of good behaviour for a period of 12 months. Further, the magistrate ordered reparation in the amount of $50,236.23.
The appellant contends that the sentence is manifestly excessive and seeks to have the sentence set aside.
The appellant was in receipt of Newstart Allowance when she commenced fulltime employment in September 2008. She failed to declare the income from this employment. She continued in receipt of this allowance to June 2009. This is the period covered by counts 1 and 2. In June 2009 the appellant submitted a claim for a Disability Support Pension. She was granted the pension and continued in receipt of the same until January 2011. She was in fulltime employment throughout this period. She failed to disclose that fact to the respondent. This is the subject of counts 3, 4 and 5.
Before the magistrate, counsel for the appellant submitted that the appellant’s lack of prior offending, her volunteer work, her medical history (the appellant suffered from leukaemia from a young age and continues to suffer from chronic pain), and her history of domestic violence, were all factors in the appellant’s favour which justified a non-custodial sentence.
Counsel for the respondent submitted that this offence was at the more serious end of the scale. Particular mention was made of the ‘sustained and deliberate’ nature of the offending, necessitating a custodial sentence with the requirement that at least some time be served.
The appellant served four days imprisonment before bail was granted pending the hearing of this appeal.
Reasons for sentence
The learned magistrate, in imposing sentence, identified the circumstances of the offending, which occurred over a period of 28 months and involved a sum in excess of $50,000.
He referred to the appellant’s employment through this period and her failure to declare her income. He noted the appellant’s admission in relation to her conduct once it was discovered. He noted that the appellant had previously received overpayments of Disability Support Pension in the context of her awareness of her obligations and the potential for overpayments to occur. The learned magistrate referred to the circumstances of the offending noting that the appellant had been in an abusive relationship which left her with a $30,000 credit card debt, and a period off work due to ill health which left her anxious that she would lose the employment she had recently obtained. He noted that the appellant had long-term health problems since she had been diagnosed with leukaemia in 1995 when she was 15 years old. He acknowledged that her health issues would make any sentence of imprisonment more difficult for the appellant than for other people, but considered that her health could be appropriately managed within a custodial environment. He nonetheless made allowance for that in fixing the term of imprisonment. He also noted the community work the appellant had undertaken with the CanTeen organisation.
Against these factors, the learned magistrate weighed the fact that the offending was ongoing and persistent, involving a substantial overpayment, and there was nothing in the evidence before him which attributed her offending in any way to her ill health.
The learned magistrate concluded:
Taking all those factors into account including your plea of guilty I have formed the view that a sentence of imprisonment is the appropriate outcome for these matters. My starting point is a sentence of 12 months imprisonment. I reduce that to nine months on account of your plea of guilty to the charges before the court. As I said the issue of whether I should require you to serve some or all of that sentence of imprisonment was raised. In considering that submission I take into account your personal circumstances and all the circumstances that I have set out before. In particular so far as that submission is concerned I have regard to your health issues and have formed the view that after serving a period of two months imprisonment you can be released on entering into a recognizance for a period of 12 months a condition of which is that you be of good behaviour. So I am requiring you to serve two months of the sentence of imprisonment, the balance of which will be suspended on you entering into a recognizance for a period of 12 months. I’ll make an order of reparation in the amount of $50,236.23 and I will not make an order for costs in the circumstances. So there’s a period of two months to serve, the balance of seven months will be suspended. The recognizance will be in the sum of $200.
The appeal
The appellant contends that the magistrate erred in the application of s 16A of the Crimes Act 1914 (Cth) (the Act), which sets out various factors that the Court must take into account when sentencing.
The appellant contended the learned magistrate failed to take into account or give proper weight to the appellant’s good character and lack of prior convictions, her contrition, her making reparations, her cooperation with law enforcement agencies in the investigation of her offences, the probable effect that the sentence would have on her family and on her health, and the appellant’s prospects of rehabilitation.
Ultimately, in the course of submissions, Ms Burgess, counsel for the appellant, accepted that the head sentence of nine months imposed by the learned magistrate could not be considered manifestly excessive in the circumstances, but submitted that the exercise of the learned magistrate’s sentencing discretion had miscarried by reason of his failure to make an order for the immediate release of the appellant. She submitted that, having regard to all the circumstances, the requirement to serve two months imprisonment evidenced an error in the exercise of the sentencing discretion. In particular, she relied upon the learned magistrate’s apparent failure to have any regard to the prospects of rehabilitation.
Ms Barnes, counsel for the Commonwealth DPP, submitted that the serious nature of the appellant’s offending combined with the need for general deterrence of social security fraud, meant that the sentence imposed, including, in particular, the failure to order immediate release, was well within the range of sentencing options available to the learned magistrate, no error is apparent in the manner of the exercise of the sentencing discretion, and there was no miscarriage of justice.
The approach of an appellate court
The circumstances in which an appellate court may interfere with a sentence are well known.
In Markarian v The Queen[1] Gleeson CJ, Gummow, Hayne and Callinan JJ described those circumstances as follows:[2]
As with other discretionary judgments, the inquiry on an appeal against sentence is identified in the well-known passage in the joint reasons of Dixon, Evatt and McTiernan JJ in House v The King, itself an appeal against sentence. Thus is specific error shown? (Has there been some error of principle? Has the sentencer allowed extraneous or irrelevant matters to guide or affect the decision? Have the facts been mistaken? Has the sentencer not taken some material consideration into account?) Or if specific error is not shown, is the result embodied in the order unreasonable or plainly unjust? It is this last kind of error that is usually described, in an offender’s appeal, as “manifest excess”, or in a prosecution appeal, as “manifest inadequacy”.
[1] (2005) 228 CLR 357.
[2] (2005) 228 CLR 357 at 370 – 371.
This approach was further explained in Dinsdale v The Queen[3] by Kirby J, who said:[4]
As on appeal from discretionary decisions, it will sometimes not be possible to identify, with exactness, an error of the foregoing kind; yet the result that is challenged may be so manifestly unreasonable or plainly wrong that the appellate court will be able to infer that, in some unidentified way, there has been a failure to exercise the power properly. In appellate review of sentencing, it will commonly be the case that the appellate court’s authority to intervene will derive from a conclusion that the resulting order is so disproportionate to the matter to which it relates as to afford the foundation for concluding that, in some way, the exercise of the powers of the primary judge has miscarried.
[3] (2000) 202 CLR 321.
[4] (2000) 202 CLR 321 at 340 [59].
Consideration
Section 16A(2) of the Crimes Act sets out a list of factors that are to be considered when passing sentence. It is not an exhaustive list. It does not require a sentencing magistrate to refer to each of the matters when explaining the sentence imposed.[5]
[5] R v Ferrer-Esis (1991) 55 A Crim R 231 at 237 – 238.
In any event, I consider the learned sentencing magistrate had proper regard to the appellant’s good character and lack of prior convictions, her contrition, her making reparations, her cooperation with law enforcement agencies in the investigation of her offences, and the probable effect that the sentence would have on her health, in imposing sentence.
He referred several times to her guilty plea, and indicated a three-month discount for the same. He also took into account her admissions to the Department, and the repayment that had been made totalling $3,880.55. In fact, the learned magistrate had been misinformed as to the extent of the repayment at that time which, in truth, was only $3,300.
The appellant is making reparation by way of a fortnightly payment of $100. Subsequent to the hearing of the appeal, she made a further lump sum repayment of $10,000 with the assistance of her family. Counsel for the appellant informed the Court that the appellant’s family was endeavouring to make additional lump sum repayments on her behalf in the near future. I take this into account.
I am also satisfied that the learned magistrate had proper regard to her limited cooperation with the law enforcement agency investigating her offending when she freely made admissions outside a formal interview process.
The learned magistrate did not refer to the impact a term of imprisonment would have on the appellant’s family, but I do not understand any submission was put to the learned magistrate on that subject. In any event, I am satisfied there is no proper basis for the learned magistrate to have taken this into account. There is no suggestion that the appellant has any dependents who might be adversely affected by the term of imprisonment imposed.
The learned magistrate did take account of the appellant’s health. He had regard to the fact that her ill health would make a custodial sentence more difficult, but properly, he considered that this was not a basis upon which he could find that the appellant should be spared a custodial sentence in circumstances where he was satisfied that her health issues could be appropriately managed in prison.
The appellant’s crime was calculated and deliberate, and involved a sustained pattern of offending. It cannot be characterised as impulsive as the offending occurred over a period of 28 months. I agree with the submission of counsel for the respondent that a head sentence of nine months is moderate given the maximum penalty of 12 months imprisonment for each offence, and the objective seriousness of the offending. Nonetheless, I am satisfied that the learned sentencing magistrate fell into error in failing to order the immediate release of the appellant.
He fell into error in two ways. First, he failed to give consideration, or at least proper consideration, to the appellant’s rehabilitation. Secondly, in requiring the appellant to serve part of the term of imprisonment imposed there was a miscarriage of justice.
In Kovacevic v Mills[6] the Full Court, in considering an appeal against a sentence of 10 months imprisonment where the appellant was ordered to be released after serving three months upon entering a bond to be of good behaviour for three years, allowed the appeal for the purposes of ordering that the appellant be released forthwith upon entering into a bond. The Full Court referred to the responsibility of the courts to protect the integrity of the social security system, and the need for a firm approach to offences involving sustained and deliberate fraud. It emphasised the obligation of the Court to do what it could to deter such offending, given the commonplace nature of such offending which undermines the system of social security and imposes substantial costs upon the community. In this context the Full Court said:[7]
We agree that in cases of deliberate and sustained fraud, deterrence must loom large in determining the appropriate sentence. But other matters, especially rehabilitation, must still be considered. We do not agree that deterrence must take priority over all other considerations, at least if that statement means that there is no scope for the Court to be influenced by considerations of rehabilitation in finally arriving at the sentence to be imposed. It may well be that King CJ did not mean to exclude considerations of rehabilitation, or mean to say that a sentence of imprisonment, with at least some of it to be served, must be imposed in every case of sustained and deliberate fraud. But his remarks are capable of being read as requiring an order for imprisonment, with at least some of it to be served, in virtually every case, and absent truly exceptional circumstances.
In our opinion the proper approach to sentencing is better reflected by saying that in a case of the type referred to by King CJ, an order for imprisonment, with at least some of the imprisonment actually to be served, is ordinarily likely to be required. This is because the commission of a number of offences of fraud over a period of time makes imprisonment appropriate even for a first offender, because of the seriousness of the offending. The same matters may require that at least part of that term of imprisonment actually be served, even in the case of a person with no previous convictions. But there is still a need to consider all aspects of the matter, and to consider the interests of society and of the offender in the rehabilitation of the offender. Also, in an appropriate case, there may be room for the exercise of mercy and leniency: see Webb v 0 'Sullivan [1952] SASR 65 per Napier CJ at 66 and R v Osenkowski (1982) 30 SASR 212 at 212- 213.
In some cases the length of the period during which the offending occurs, or the amount involved, or the devices used to effect the fraud, is likely to lead a court to conclude that a sentence of imprisonment actually to be served is required. As is always the case in sentencing, and as Cox J said in R v King, a sentencing standard is a general guide to those who have to sentence in the future, with certain tolerances built into it.
[6] (2000) 76 SASR 404.
[7] (2000) 76 SASR 404 at 411 – 412.
In my view, the sentencing magistrate erred in failing to have regard, or at least proper regard, to the interests of society and of the appellant in her rehabilitation.
The learned magistrate failed to refer to this matter at all. It was an important consideration.
The appellant is a 33-year old woman. She is in stable employment. She has worked for the past three-and-a-half years as a learning and development officer. Her ill health causes her to be off work regularly. Sometimes she is absent for more than a month. Nonetheless her employer is sympathetic, and has permitted her to continue in her position on this basis.
I accept that if she was required to serve the sentence imposed of two months in prison she is at serious risk of losing this employment. In all likelihood that would result in her being thrown back onto the social security system for who knows what period. That would be inimical to the appellant’s rehabilitation. It would not be in her interests or in the interests of society.
Moreover, her circumstances since the offending have changed. She is no longer in an abusive relationship. She is engaged to be married. She has a supportive family. It is apparent they have rallied around since the appellant found herself in these difficulties.
Finally, I consider that the appellant is most unlikely to reoffend. She served four days in prison before she was bailed. I am satisfied that was a salutary experience which she would not wish to repeat. It is unnecessary for the purposes of specific deterrence that she serve any further time in custody.
I am satisfied no good purpose would be served by requiring the appellant to spend two months in prison. The learned magistrate fell into error in considering otherwise. In the unusual circumstances of this case, the requirement that she do so was a miscarriage of justice. Equally, I am satisfied that the sentencing magistrate fell into error in failing to consider the question of rehabilitation.

In all the circumstances I am satisfied that the appeal should be allowed. The sentence should be set aside. I would resentence the appellant. I would impose a term of imprisonment of nine months but the appellant is to be released forthwith upon entering into a bond pursuant to s 20 of the Act in the sum of $500 to be of good behaviour for 12 months. I would further order that reparation be made in the amount of $50,236.23.
In imposing this sentence I wish to emphasise that the crime for which the appellant has been convicted is serious. Ordinarily, an order for imprisonment would follow a conviction of this kind, but I am satisfied that in the particular circumstances of this appellant, a sentence requiring even a part of the term imposed actually to be served, discloses an error on the part of the sentencing magistrate in the approach taken and constitutes a miscarriage of justice.
Conclusion
I allow the appeal. I set aside the sentence imposed by the learned magistrate. I sentence the appellant to nine months imprisonment, but the appellant is to be released forthwith upon entering into a bond pursuant to s 20 of the Crimes Act 1914 (Cth) in the sum of $500 to be of good behaviour for 12 months. I order that reparation be made in the amount of $50,236.23.