McLean v The State of Western Australia

[2011] WASCA 60

JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT :   THE COURT OF APPEAL (WA)

CITATION:   McLEAN -v- THE STATE OF WESTERN AUSTRALIA [2011] WASCA 60

CORAM:   McLURE P

NEWNES JA
MAZZA J

HEARD:   14 DECEMBER 2010

DELIVERED          :   16 MARCH 2011

FILE NO/S:   CACR 88 of 2010

BETWEEN:   ALEXANDER JASON McLEAN

Appellant

AND

THE STATE OF WESTERN AUSTRALIA
Respondent

ON APPEAL FROM:

Jurisdiction              :  DISTRICT COURT OF WESTERN AUSTRALIA

Coram  :MARTINO ACJDC

File No  :IND 155 of 2010

Catchwords:

Criminal law - Appeal against sentence - Fraud - Whether sentences manifestly excessive - Whether sufficient discount given for fast-track plea of guilty - Whether first limb of totality principle infringed - Whether one transaction rule infringed

Legislation:

Criminal Code (WA), s 409(1)(c)

Result:

Leave to appeal refused
Appeal dismissed

Category:    B

Representation:

Counsel:

Appellant:     In person

Respondent:     Ms L E Christian

Solicitors:

Appellant:     In person

Respondent:     Director of Public Prosecutions (WA)

Case(s) referred to in judgment(s):

Brennan v The State of Western Australia [2010] WASCA 19

Fullgrabe v The State of Western Australia [2006] WASCA 138

Giglia v The State of Western Australia [2010] WASCA 9

Hladin v The State of Western Australia [2005] WASCA 50

Hodder v The Queen (1995) 15 WAR 264

McDougall v The State of Western Australia [2009] WASCA 232

Royer v The State of Western Australia [2009] WASCA 139; (2009) 197 A Crim R 319

Smallbone v The State of Western Australia [2008] WASCA 167

Trompler v The State of Western Australia [2008] WASCA 265

Vagh v The State of Western Australia [2007] WASCA 17

Wheeler v The State of Western Australia [2010] WASCA 105

Wilson v The State of Western Australia [2010] WASCA 82

1. McLURE P:  I agree with Mazza J.

2. NEWNES JA:  I agree with Mazza J.

3. MAZZA J:  The appellant seeks leave to appeal against sentences imposed by Acting Chief Judge Martino (as his Honour then was) in the District Court of Western Australia on 1 June 2010.  The appellant, a legal practitioner, represented himself before this court.

4. Originally there were five grounds of appeal.  However, leave to appeal was refused on grounds 4 and 5.  The grounds on which the appellant seeks leave to appeal are, omitting particulars:

   1.the sentence[s] were manifestly excessive;

   2.the learned sentencing judge failed to allow a 'sufficient discount' to the sentence[s] he imposed by reason of the appellant's fast‑track pleas of guilty; and

   3.the total effective sentence offended the one transaction rule and the totality principle.

5. The appellant was charged in an indictment dated 22 December 2009 with two offences of fraud contrary to s 409(1)(c) of the Criminal Code (WA). Those offences were as follows:

   1.On 20 December 2002 at Perth [the appellant], with intent to defraud, by deceit or fraudulent means gained a benefit, namely $115,672.66 for the Ukrainian Association Inc. 

   2.On or about 8 September 2005 at Perth [the appellant], with intent to defraud, by deceit or fraudulent means gained a benefit, namely $116,475.03 for the Ukrainian Association Inc.

6. On 1 June 2010, the appellant pleaded guilty to these offences, and on the same day he was sentenced to 1 year and 4 months' imprisonment on each count, to be served cumulatively, resulting in a total effective sentence of 2 years and 8 months' imprisonment.  The appellant was made eligible for parole. 

The facts of the offending

1. His Honour's findings of fact, for the purposes of sentence, are not in dispute (appeal ts 4).  They can be summarised as follows.

2. At all material times, the appellant was an employed solicitor in the litigation department of a law firm.  His clients included a number of

major banks.  In addition to work he performed for clients of that law firm, he also acted as the solicitor, on an unpaid basis, for the Ukrainian Association of Western Australia (the Association).  He was, at times, the secretary of that body.  The Association was in financial difficulty, which arose out of the construction of a new function centre in a Perth suburb.

1. The first offence occurred after a bank had paid to the appellant's law firm unclaimed moneys that the bank had received from mortgagee sales of property.  The moneys were the balance of funds received from those sales after repaying the sums secured by the mortgages and the costs of the sales to the bank.  The appellant directed that $115,672.66 of these moneys be held in the trust account of the law firm for the Association.  Between 24 December 2002 and 5 August 2003, funds from that account were disbursed as various payments made on behalf of the Association.  On 12 August 2003, the balance of the funds, $65,314.42, was forwarded to the Association.

2. At the time of the second offence, the appellant was handling a mortgagee sale by a bank with respect to property belonging to a deceased estate.  The bank authorised the firm to hold $116,475.03 in trust, and then pay those funds to the Sheriff's Office for the benefit of the deceased estate.  On 8 September 2005, contrary to the bank's authority, the appellant forwarded a cheque to the Sheriff's Office from the firm's trust account in the sum of $116,475.03 directing that the money be applied to the Association for a writ of execution against it.  On the same day, a debenture was issued by the Association to the appellant for an identical sum.

3. The function centre, which was at the centre of the Association's financial problems, was sold on 10 February 2006.  The appellant was paid from the proceeds of that sale $116,475.03 in satisfaction of the debenture.  He deposited some of those moneys into his bank account and some into a credit card account in his name. 

4. In March 2008, a solicitor acting on behalf of the deceased estate contacted the firm.  By then, the appellant was a non‑equity partner in another law firm.  The appellant was interviewed by a partner of the (former) firm and later that day the appellant sent a bank cheque in the sum of $116,475.03 to the firm. 

5. A commercial settlement was reached with respect to the repayment of the amount the subject of count 1, while the sum the subject of count 2 was, as I have already set out, repaid in full.

The appellant's antecedents

1. The appellant was 37 years of age at the time of his sentence.

2. His grandmother was of Ukrainian descent.  She was instrumental in establishing the Association and, from an early age, the appellant was involved in many activities designed to further Ukrainian culture in Western Australia.  It was not disputed that the appellant's grandmother instilled in the appellant a high degree of loyalty and a feeling of obligation towards the Association.

3. The appellant was admitted to legal practice in 1997, and in 2006 he became a non‑equity partner in a prominent law firm.  He involved himself in various professional activities, especially with respect to young lawyers.  One of these activities was lecturing young lawyers in ethics.  The appellant ceased practice in 2008 when these offences came to light, and he accepts that his legal career is over:  AB 46.  After he ceased practice, the appellant was employed by an engineering firm. 

4. The appellant married in 1999.  He and his wife now have two young children, the second of whom was born after the appellant was sentenced.  The appellant's wife has suffered from post‑natal depression after the birth of each child.

5. The appellant has no prior record of offending.  The many character references tendered to his Honour spoke highly of his general character, his ability as a lawyer, his service to the legal profession and his work on behalf of the Association and the Ukrainian community generally.

6. In addition to the character references, his Honour had before him a written pre‑sentence report, a report from a forensic psychologist, Mary‑Anne Martin, and a report from the appellant's treating psychologist, Ms Susan Latter.

7. The psychometric testing conducted by Ms Martin, while identifying high levels of anxiety and depressive symptoms, do not suggest any relevant psychopathology. 

8. Ms Latter's report does not, as I read it, come to any different conclusion.  Ms Latter said at par 1.3 of her report that there was an 'absence of any identifiable or clinically classifiable pathology'.   Both reports suggest that the appellant, due to his background, had an overdeveloped sense of responsibility towards the Association, and that he acted in what was an ultimately futile way to assist it.

His Honour's sentencing remarks

1. His Honour found that the appellant committed the offences not for personal gain, but to assist the Association.  His Honour acknowledged that the appellant felt a very strong need to assist the Association as a result of a strong sense of family responsibility placed on him from a very young age.  While this explained the appellant's offending, his Honour found that it did not excuse it.  His Honour made the point that the money which the appellant defrauded was not his to use for the benefit of the Association.  Rather, it was money entrusted to his law firm and he had been trusted by that firm to comply with his professional obligations:  AB 56.

2. His Honour rightly emphasised the breach of trust that had been placed in the appellant as a legal practitioner.  He observed that legal practitioners are trusted with other people's money, and the community expects that legal practitioners will honour that trust:  AB 55.

3. His Honour expressly took into account:

   (a)the appellant's early pleas of guilty;

   (b)his remorse;

   (c)his prior good character and the contributions that he had made to the community, particularly the Ukrainian community and the legal profession;

   (d)the counselling he had taken, since the offences had come to light, to address the pressures he was under at the time of his offending;

   (e)the loss of the appellant's promising legal career;

   (f)the distress and embarrassment caused by his offending; and

   (g)that his close connection with the Ukrainian community had been permanently broken.

4. Notwithstanding the mitigating circumstances, his Honour was of the view that the offences were so serious that the only appropriate disposition was terms of imprisonment.  His Honour considered that because the offences were separate, committed at separate times, they should be served cumulatively:  AB 56 and 57.  His Honour expressly considered whether the terms should be served or suspended.  His Honour decided that suspended terms of imprisonment were inappropriate because the offences were too serious, and because of the need for general deterrence:  AB 57.

The parties' submissions

1. The appellant's overall submission is that the sentences of immediate imprisonment imposed by his Honour were too long and should be reduced:  AB 6 and appeal ts 3. 

2. In support of ground 1, the appellant alleged that the sentencing judge failed to give sufficient weight to a number of matters.  Further, he failed to give any weight at all to other matters and took into account allegedly irrelevant and prejudicial material which had been tendered to the sentencing judge in the prosecution brief. 

3. The matters to which the appellant said that his Honour did not have sufficient regard were:

   1.The absence of any prior criminal history and the appellant's active contribution to the legal and general community in Western Australia.

   2.The appellant was under 'considerable stress' from his legal practice and from individual members of the Ukrainian community who were contacting him in connection with the affairs of the Association.

   3The appellant did not personally benefit from the offending.

   4.The appellant did not attempt or actually destroy or remove any incriminating documentation.

   5.The appellant made full restitution of the amount defrauded in count 2 and entered into a deed of settlement in relation to the amount defrauded in count 1.

   6.The appellant's reduced future employment prospects.

4. The matters the sentencing judge allegedly failed to take into account were:

   1.the appellant's psychological state at the time of his offending; and

   2.the appellant's wife's previously diagnosed post‑natal depression.

5. The irrelevant and prejudicial material which the appellant referred to concerned charges which had been withdrawn, and material contained in the prosecution brief which was not referred to in the statement of agreed facts read to the sentencing judge by the prosecutor at the sentencing hearing.

6. In further support of ground 1, the appellant submitted that when compared with other cases, namely Brennan v The State of Western Australia [2010] WASCA 19; Hladin v The State of Western Australia [2005] WASCA 50; and Smallbone v The State of Western Australia [2008] WASCA 167, the sentences imposed on him were excessive.

7. As to ground 2, the appellant submitted that the sentencing judge gave an insufficient discount to his early pleas of guilty.

8. With respect to ground 3, the appellant submitted that the sentencing judge imposed a total overall sentence which, as he described it, was 'unduly harsh'.  I interpret this submission as amounting to an alleged breach of the first limb of the totality principle.  That is, that the total overall sentence imposed upon him was not a just and appropriate measure of the total criminality involved.  The appellant also submitted that the sentencing judge's accumulation of the sentences offended the one transaction principle because, the appellant claimed, the offending was, in effect, a continuing course of conduct. 

9. The respondent submitted in relation to ground 1 that his Honour took into account all relevant matters personal to the appellant.  However, in light of the serious breach of trust committed by the appellant, the terms of imprisonment imposed were not manifestly excessive. 

10. As to ground 2, the respondent submitted that the sentencing judge expressly took into account the appellant's pleas of guilty, which were not on the fast‑track system, but were nevertheless early pleas. 

11. With respect to ground 3, the respondent submitted that the appellant's offending involved the commission of separate offences at separate times.  It was submitted that the sentencing judge did not offend either the first limb of the totality principle or the one transaction principle.

General principles applicable to this appeal

1. Before embarking upon an analysis of the merits of the grounds of appeal, it is as well to recognise the general appellate principles which apply to appeals against sentence.  It is necessary to do this because it is clear, from both the appellant's written and oral submissions, that he did not have a full understanding of the relevant principles which were conveniently summarised by this court in Wilson v The State of Western Australia [2010] WASCA 82 [2]:

   The relevant principles on which an appellate court operates are dictated by the Criminal Appeals Act 2004 (WA) and by previous decisions of the High Court and of this court that we are bound to follow or that represent persuasive authority. Those principles include the following.

   1.The imposition of a sentence involves the exercise of a discretion.  An appellate court can only intervene if the appellant demonstrates that the judge erred in exercising the discretion in one of two ways.  The first is called express error and it involves acting on a wrong principle, for example, by mistaking the law, mistaking the facts, taking into account an irrelevant matter or failing to take into account a relevant consideration.  The second is referred to as implied or inferred error.  It arises where, although it is not possible to discover the exact nature of the error, the end result is so unreasonable or unjust that the court must conclude that a substantial wrong has occurred: House v The King (1936) 55 CLR 499, 505. In most instances a challenge based on implied error will involve the contention that an individual sentence is manifestly excessive (or inadequate) and (or) that the total effective term imposed for all charges offends the totality principle.

   2.It follows that the appeal court will not intervene simply because the members of the court, had they been sentencing the offender at the original hearing, might have imposed a different sentence: House, 505.

   3.Even if error is demonstrated the appellate court can intervene only if it is satisfied that a different sentence should have been imposed at the original hearing: Criminal Appeals Act s 31(4)(a).

   …

2. All three grounds of appeal allege implied or inferred error.  However, the particulars and submissions in support of ground 1 include a combination of both implied and express error.  Further, some of the particulars and submissions in support of ground 1 and the entirety of ground 2 allege that his Honour failed to give adequate weight to a relevant sentencing consideration.  A failure to give adequate weight or pay sufficient regard to a relevant sentencing consideration only gives rise to an appealable error if it amounts to a failure to exercise the discretion actually entrusted to the court:  Vagh v The State of Western Australia [2007] WASCA 17 [76]. In the absence of a failure to exercise the discretion, a weighting error is not an independent ground which itself justifies appellate intervention. Rather, it is a conclusion that is implicit in, and flows from, a finding that a sentence is manifestly excessive: Trompler v The State of Western Australia [2008] WASCA 265 [32].

Merits of the grounds of appeal

Ground 1

1. Of the matters the appellant alleged that his Honour did not pay sufficient regard to, all, save for the point that the appellant did not attempt or actually destroy or remove any incriminating documentation, were referred to by his Honour and plainly taken into account.  There is no merit to the submission that his Honour made weighting errors.

2. The fact that the appellant did not attempt or actually destroy or remove any incriminating documentation is not a matter of mitigation.  Rather, it is merely an absent aggravating factor.

3. The appellant relies on the fact that his Honour did not expressly refer in his sentencing remarks to the appellant's wife's previously diagnosed post‑natal depression or to the possibility that the condition would return after the birth of the appellant's second child.  However, the appellant's wife's position was known to his Honour.  Amongst the sentencing materials provided to his Honour on behalf of the appellant, was a statement by the appellant's wife dated 28 May 2010.  In that statement she refers to the severe post‑natal depression that followed the birth of their first child and her fear that she may suffer from that condition after the birth of their second child. 

4. In his sentencing remarks his Honour referred to the appellant's wife's statement and to the great hardship which the appellant's imprisonment would bring to his family:  ts 56.  It cannot be said in these circumstances that his Honour failed to take into account these matters.

5. In any event, the impact of a sentence upon an offender's family is not a matter that is ordinarily mitigating.  Hardship to an offender's family must be quite out of the ordinary before it can substantially mitigate penalty:  Hodder v The Queen (1995) 15 WAR 264 at 287. Further, the more serious the offence, the less the court has the capacity to mitigate punishment having regard to hardship to an offender's family: Hodder v The Queen at 286. While the appellant's absence will undoubtedly be a burden on the appellant's wife and children, the degree of hardship is not such as to justify any substantial mitigation.

6. His Honour did not refer to the appellant's psychological state as mitigatory.  This is hardly surprising.  Neither of the psychologists who provided reports to the sentencing judge identified any psychiatric or psychological impairment which reduced the appellant's moral culpability or in any other way mitigated his offending.  The appellant's sense of obligation along with the pressures and stresses that were on him were correctly characterised by his Honour as explanations for the appellant's offending, but not excuses:  AB 56.

1. Even if the matters set out in the psychological reports amounted to some kind of mental impairment, it does not follow that the sentences should be reduced.  Much depends upon the nature, effect and severity of the condition and its symptoms:  Wheeler v The State of Western Australia [2010] WASCA 105 [9]. In this case, the appellant knew full well that his actions were illegal and totally contrary to his professional duties. Any mental impairment did not deprive him of his ability to control his actions or make reasonable judgments.

2. His Honour gave mitigatory weight to the steps the appellant had taken to address his offending behaviour.  This was as far as his Honour could appropriately go on the facts before him.  He made no error in his treatment of the appellant's psychological state. 

3. There is nothing to the complaint that his Honour took into account irrelevant material.  The material which was said to be prejudicial was not referred to by his Honour and was not taken into account by him.  This complaint is without merit. 

4. With respect to the complaint of manifest excess, the principles to be applied are clear.  To determine whether a sentence is manifestly excessive, regard is had to the maximum sentence prescribed by law for the crime, the standard of sentencing customarily observed with respect to the crime, the place which the criminal conduct occupies in the scale of seriousness of crimes of that type and the personal circumstances of the offender:  McDougall v The State of Western Australia [2009] WASCA 232 [13].

5. The maximum sentence for fraud contrary to s 409(1)(c) of the Criminal Code is 7 years' imprisonment.

6. The offences were plainly serious.  The most serious feature of the appellant's offending was his breaches of trust.  He took advantage of his position as a lawyer to dishonestly appropriate money which belonged to his clients.  The appellant's conduct was a complete dereliction of his ethical obligations and duties.  The offending was not isolated.  He offended twice in a period of just under three years.  The amounts that were defrauded were substantial.  Although there was not a great deal of sophistication associated with the offending, the appellant used his knowledge of the law firm's system of payments to perpetrate the frauds.

7. The appellant emphasised in both his written and oral submissions that he had not personally gained by his offending and that he offended, in effect, for altruistic purposes.  I do not regard these matters as mitigating the appellant's offending.  He owed his paramount duty to his clients, as he well knew.  It was not for the appellant to use his clients' money to financially prop up a cause to which the appellant felt morally bound.

8. General deterrence, in cases such as this, is a dominant sentencing consideration.  This type of offending substantially erodes public confidence in the legal profession and must be deterred.  While the appellant's good antecedents remain relevant and provide some mitigation, less weight attaches to them than might otherwise be the case:  Brennan v The State of Western Australia [35].

9. The cases relied upon by the appellant to illustrate that the sentences imposed upon him were excessive do not establish a range of sentences customarily imposed.  In Smallbone v The State of Western Australia, Steytler P undertook an analysis of a large number of cases involving dishonesty.  At the conclusion of that analysis his Honour said:

   The cases are not entirely consistent.  That is especially so when some of the sentences imposed in respect of these less serious offences are compared with those imposed for more serious offending of the kind considered in cases such as Hladin. However, they reveal that, in a case involving a sustained period of offending involving a breach of trust, a first offender who is a mature adult can ordinarily expect to receive a sentence of immediate imprisonment even when the amount stolen is comparatively modest (but still significant). In saying this, I should emphasise the use of the word 'ordinarily'. Every case will depend upon its own circumstances and these are infinitely variable. Also, the amount stolen will not necessarily be the most important consideration. Its importance will be influenced by such matters as the effect on the person or entity stolen from, the nature and degree of the breach of trust, the period of the offending, the reasons for it and the personal circumstances of the offender [30].

10. In light of the seriousness of the offending, involving repeated breaches of trust by a legal practitioner, and the need to provide general deterrence, significant immediate terms of imprisonment were inevitable.  I am not satisfied that either of the sentences imposed upon the appellant were manifestly excessive.

11. Ground 1 has not been made out.

Ground 2

1. Ground 2 is simply an allegation of an unappealable weighting error.  In any event, his Honour expressly referred to the appellant's pleas of guilty and gave them mitigating weight.  He said at AB 55:

   You have pleaded guilty at an early stage of this prosecution, and these charges were committed to this court for sentence by reason of your early pleas of guilty.

   Those early pleas of guilty show a willingness to facilitate the course of justice and acceptance of responsibility for your offending behaviour.  You are remorseful for your offending, and I have reduced the sentence I am to impose by reason of all of these matters.

2. Insofar as the appellant may have been alleging that his Honour failed to specify the percentage by which he discounted the sentence to take into account the guilty pleas, the submission cannot be accepted.  It is not a requirement of law to quantify the discount to be given to a plea of guilty:  Fullgrabe v The State of Western Australia [2006] WASCA 138 [27] ‑ [28].

3. Ground 2 has not been made out.

Ground 3

1. The submission that the sentences offended the so‑called 'one transaction principle' cannot be sustained.  The one transaction principle was discussed by Owen JA in Royer v The State of Western Australia [2009] WASCA 139; (2009) 197 A Crim R 319 [19] ‑ [31]. .

2. In this case, while the appellant committed the same offence for the same apparent motive, his criminality was separate.  The two offences were not only separated by a substantial period of time, but involved defrauding money from different clients.  The appellant made separate and deliberate decisions to commit the two frauds.  Having committed the first fraud with the knowledge that what he had done was very wrong, he decided to commit a further fraud.  This is not a case to which the one transaction rule can be properly applied.

3. The totality principle is well known.  It has two limbs.  The first limb requires a sentencer, called upon to sentence an offender for a number of offences, to ensure that the aggregation of the appropriate sentences for each offence is a just and appropriate measure of the total criminality involved.  The second limb requires a sentencer not to impose a total sentence which is 'crushing' on the offender:  Giglia v The State of Western Australia [2010] WASCA 9 [43]. The appellant submits that his Honour infringed the first limb of the totality principle.

4. His Honour had express regard to the totality principle but nevertheless ordered the two sentences should be served cumulatively.

5. I will not repeat what I have already said about the appellant's offending.  It is enough to dispose of this ground to say that in all the circumstances the total term of imprisonment imposed upon the appellant of 2 years and 8 months was a proper reflection of his overall criminality.

6. Ground 3 has not been made out.

Conclusion

1. The conclusion that I have reached is that none of the grounds of appeal have been made out.  I would refuse leave to appeal and dismiss the appeal.

Orders

1.Leave to appeal is refused.

2.The appeal is dismissed.