Moreland v Snowdon

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION: MORELAND -v- SNOWDON [2007] WASC 137

CORAM: JENKINS J

HEARD: 28 MAY 2007

DELIVERED : 29 MAY 2007

FILE NO/S: SJA 1062 of 2006

BETWEEN: PAULA MORELAND
Appellant
AND
KIRSTY JANE SNOWDON
Respondent

ON APPEAL FROM:
Jurisdiction              :  MAGISTRATES COURT OF WESTERN AUSTRALIA
Coram  :MAGISTRATE L H JONES
File No  :AR 4558 of 2006

Catchwords:

Criminal law - Prosecution appeal against sentence - Social security fraud - Whether conviction ought to have been recorded

Legislation:

Crimes Act 1914 (Cth), s 16A, s 19(1)(d), s 19B, s 19B(1), s 19B(2A)
Criminal Appeals Act 2004 (WA), s 40, s 41
Social Security (Administration) Act 1999 (Cth), s 215(1), s 217

Result:

Appeal allowed

Category: B

Representation:

Counsel:

Appellant: Mr D W L Renton
Respondent: No appearance

Solicitors:

Appellant: Commonwealth Director of Public Prosecutions
Respondent: No appearance

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

Everett v The Queen (1994) 181 CLR 295
Federal Commissioner of Taxation v Baffsky (2001) 192 ALR 92
Laxton v Justice (1985) 38 SASR 376
Markarian v The Queen (2005) 215 ALR 213
Matta v Australian Competition and Consumer Commission [2000] FCA 729
Nunn v Kinnon (1988) 4 WAR 459
R v Osenkowski (1982) 30 SASR 212
R v Rossi (1988) 4 WAR 463
R v Sinclair (1990) 51 A Crim R 418
Ralph v Nawrowjee [2003] WASCA 5

JENKINS J: This is an appeal from the decision of a Magistrate sitting in the Magistrate's Court at Armadale on 25 May 2006 on Prosecution Notice 4558 of 2006. It alleged that the respondent obtained payment of a parenting payment knowing that the payment was only payable in part, contrary to the Social Security (Administration) Act 1999 (Cth), s 215(1) and s 217. The Magistrate discharged the respondent, without proceeding to conviction, upon her entering into a recognisance pursuant to the Crimes Act 1914 (Cth) ("the Crimes Act"), s 19(1)(d).

Grounds of appeal

The grounds of appeal by the prosecutor are:
(1)the sentence imposed was manifestly inadequate in all of the circumstances of the case;
(2)the learned Magistrate erred in law by failing to properly determine whether s 19B(1) of the Crimes Act was applicable; and
(3)the learned Magistrate erred in law by misdirecting himself on the effect of the imposition of a bond made pursuant to s 19B(1)(d) of the Crimes Act.

The charge

The charge alleged that the respondent, between 13 July 2004 and 2 August 2005 at Canning Vale, obtained payment of a social security payment under the social security law, namely, Parenting Payment (Single), knowing that the said payment was only payable in part, contrary to s 215(1) and s 217 of the Social Security (Administration) Act1999 (Cth).
The maximum penalty for the offence is 12 months' imprisonment or a fine of $6,600.00.
The respondent pleaded guilty. After the prosecutor recited the facts and a plea in mitigation was made, the respondent, without proceeding to a conviction, was discharged, upon her giving security in the sum of $2,000.00 that she would be of good behaviour for 30 months, make reparation in the sum of $11,153.21 and pay costs of $244.00, on or before 24 May 2008.

The facts

The facts were stated to the Magistrate as being that throughout the period of the charge the respondent had incorrectly stated her gross earnings from employment to Centrelink and thereby obtained $11,700.77 more than she was entitled to receive in parenting payment (single).
It was alleged that the respondent had received social security benefits almost continuously since around November 1994 when she was first granted a Job Search allowance. Between 5 July 2004 and 3 September 2004 the respondent was engaged on a casual basis with one employer and between 30 June 2004 and 1 July 2005 she was employed, part-time, by Telstra Corporation.
It was said that for the entire charged period she was required to report her earnings from employment every fortnight to Centrelink. On four occasions she chose to give those reports by phoning an officer at a Centrelink call centre and on 25 other occasions she gave information about her earnings using Centrelink's interactive voice response ("IVR") system.
It was alleged that on 24 of the 25 occasions the respondent had used the IVR system to report earnings, she falsely declared that she had done no work in the preceding fortnight. On the one occasion when she did report some earnings using the IVR system, she declared gross earnings of $796.50 when her actual gross earnings were $1,655.51. On the four occasions when she reported earnings by telephone, the respondent declared gross earnings amounting to a total of $2,735.00 but had actually earned $6,345.03. Overall, the earnings she declared to Centrelink represented less than 9 per cent of the $40,418.34 that she had actually earned.
When the matter was detected, the respondent provided a written statement to Centrelink. In the statement she gave no clear explanation for her offending but expressed concern that a criminal record for an offence would affect her employment prospects.
The respondent's employment history during the offending period was detected as a result of a tax declaration form review undertaken with the Australian Taxation Office.
The prosecutor told the Magistrate that the respondent had no prior convictions. He sought a reparation order in the sum of $11,153.21 on the basis that $547.56 had already been repaid. He also sought a costs order in the sum of $244.00.
The prosecutor submitted to the Magistrate that a sentence of imprisonment was an available disposition due to the amount of money involved, the duration of the fraud, the amount of money the respondent earnt in the same period (which suggested that the respondent's motivation was greed, not need), the number of false statements made by the respondent to Centrelink and the need for a generally deterrent sentence. He submitted that the need for general deterrence outweighed the factors personal to the respondent.
The respondent's counsel then made a plea in mitigation. In summary, he admitted the facts and conceded that a reparation order and costs order as sought were appropriate. Counsel submitted that his client had become a single mother in 1997 and when her child was young she had commenced full‑time study. In 2003 she moved to Queensland, with her son, to obtain work. Whilst in Queensland she accumulated a number of debts. She returned to Perth in February 2004, was then unemployed and receiving a Centrelink benefit.
In mid-2004 the respondent commenced employment and her offending behaviour commenced. In September 2004 she moved out of her parents' home where she had been living. She also started a postgraduate course in order to obtain a PhD. I pause to note that there was no evidence before the Magistrate that she had commenced or completed such a course.
Counsel noted that the respondent had no excuse for her offending. The explanation from her was that she had a large number of debts from the time she was in Queensland which were weighing upon her. She had a number of responsibilities as a full‑time student, worker and carer. These also weighed upon her.
Counsel acknowledged that the respondent was earning a "reasonable income" but said that this was going to discharge her obligations. He said that she "buckled under the pressure".
Counsel submitted that the offence was detected when the respondent filed her end of year tax return. It is clear that the Magistrate accepted this explanation and considered that the respondent's honesty in doing so was a matter which went to her credit. However, it is not entirely correct. As the prosecutor stated, the offence was detected when the tax declaration form containing the respondent's tax file number was completed by the respondent and her employer and it was compared with Centrelink's records.
Counsel submitted that the respondent, when confronted by Centrelink, had immediately admitted her offending. It was submitted that the respondent was remorseful and that the offending was out of character. It was said that the respondent had put in place a plan to repay the money to the best of her ability. She was then employed by Telstra and had an income of $1049 net per fortnight. She was to be made a permanent employee in early June 2006 and it was said that she would then be able to increase her repayments. She was living with her parents who were providing her with financial and other forms of support. Her son was then nine years of age.
The Prosecution Notice states that the respondent's date of birth was 11 February 1977. As to the respondent's future, it was submitted that the respondent had completed her PhD course requirements and that she hoped to obtain employment as a tutor in a tertiary institution. However, it was said by counsel, on her behalf, that she had made inquiries and discovered she would not be able to obtain such employment if a criminal conviction was recorded against her. Again, no proof was offered to the Court in this regard.
Counsel acknowledged that this was not a trivial offence and that an immediate custodial sentence was open but said that it was inappropriate. He said there was no risk that the respondent would re‑offend. He said that the respondent was able to pay a fine by borrowing money from family members which she would have to repay. Because of the effect a record of conviction would have on her employment prospects, counsel requested that the Magistrate make a spent conviction order.
At that point, the prosecutor advised that it was not possible to make a spent conviction order under the Commonwealth sentencing laws. He mentioned the possibility of a discharge without proceeding to a conviction pursuant to the Crimes Act, s 19B, but said that the Crown opposed such a disposition. The prosecutor submitted that a s 19B bond was out of proportion to the gravity of the offence.
The Magistrate took a short adjournment to consider his sentence. When he returned, his Honour heard further submissions from counsel on whether a discharge pursuant to s 19B should be ordered. He then proceeded to sentence the respondent.
His Honour expressly recorded a conviction against the respondent which is also recorded on the Prosecution Notice. However, in light of his subsequent order I assume that he simply forgot to withdraw that ruling. I will proceed on the basis that, by implication, he did so.
After reciting the facts, his Honour agreed with the Crown that the offence was of "some seriousness". He also referred to the length of time over which the deceit was carried on. At various times both the prosecutor and the Magistrate referred to the deceit being carried on over 15 months. It was in fact a period of 12 months and three weeks. Nothing turns on the misdescription of the length of the offending behaviour.
His Honour then referred to matters personal to the respondent in the context of the principles applicable to the sentencing of Commonwealth offenders which are contained in the Crimes Act, s 16A. His Honour then read into the transcript the Crimes Act, s 19B(1), which, relevantly, states:
"Where:
(a)a person is charged before a court with a federal offence or federal offences; and
(b)the court is satisfied, in respect of that charge or more than one of those charges, that the charge is proved, but is of the opinion, having regard to:
(i)the character, antecedents, age, health or mental condition of the person;
(ii)the extent (if any) to which the offence is of a trivial nature; or
(iii)the extent (if any) to which the offence was committed under extenuating circumstances;
that it is inexpedient to inflict any punishment, or to inflict any punishment other than a nominal punishment, or that it is expedient to release the offender on probation;
the court may, by order:
(c)dismiss the charge or charges in respect of which the court is so satisfied; or
(d)discharge the person, without proceeding to conviction in respect of any charge referred to in paragraph (c), upon his giving security, with or without sureties, by recognizance or otherwise, to the satisfaction of the court, that he will comply with the following conditions."
There are then a number of conditions listed, including that the offender will be of good behaviour for a period of not exceeding three years and that the offender will make such reparation or pay costs as the Court specifies in the order.
His Honour then said that the offence was not trivial and neither was it accompanied by extenuating circumstances. He went on to say:
"But I do take into consideration the character, and I have indicated that the references, and I make references to those now, that they indicate that Ms Snowdon is of - has been of good character, and there is no suggestion that you should be not of good character from now on and that her age - and I also take into consideration the matters that I have to take into consideration from section 16A.
I am satisfied that on the barest of margins I have to say that in this particular circumstance, and it was not - it is a matter of degree, I would have thought, that in this particular circumstance it is not like one that normally comes before me, that the provisions of 19B(1)(d) can be imposed only by the barest of margins, I have to say."
The Magistrate then referred to the references that the respondent's counsel had provided to him. Those references were from people who knew the respondent and who attested to her good character. His Honour then sentenced the respondent as previously detailed.
The Magistrate told the respondent that he had made the order because the penalty open "would be enormous." He said he had also taken into account her dependant. He said that he had not made the order because of the effect that a conviction would have on her career. He said it was because of her antecedents, personal circumstances and the circumstances surrounding her offending.
The Magistrate, incorrectly, advised the respondent that if she breached the order by failing to pay the reparation, she could be brought back to court and imprisonment would them be considered as an option. In fact, the Crimes Act, s 19B(2A) expressly states that a person is not to be imprisoned for a failure to pay an amount required to be paid under a s 19B order.

Ground 1

In relation to ground 1 of the appeal, the appellant relies upon two particulars. They are:
(1)that the learned Magistrate erred by failing to have regard to the relevant sentencing principles applicable to social security offences; and
(2)the learned Magistrate erred by failing to impose a sentence that reflected the seriousness of the offence and the need for deterrence both general and personal.
Before considering this ground in more detail, there are some general principles relating to sentencing appeals by the prosecution which are important for me to keep in mind. In Markarian v The Queen(2005) 215 ALR 213 at [25], the majority of the High Court said:
"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'".
At [27], their Honours continued:
"Express legislative provisions apart, neither principle, nor any of the grounds of appellate review, dictates the particular path that a sentencer, passing sentence in a case where the penalty is not fixed by statute, must follow in reasoning to the conclusion that the sentence to be imposed should be fixed as it is. The judgment is a discretionary judgment and, as the bases for appellate review reveal, what is required is that the sentencer must take into account all relevant considerations (and only relevant considerations) in forming the conclusion reached. As has now been pointed out more than once, there is no single correct sentence. And judges at first instance are to be allowed as much flexibility in sentencing as is consonant with consistency of approach and as accords with the statutory regime that applies."
The High Court has also previously approved of the dicta of King CJ said in R v Osenkowski (1982) 30 SASR 212 at 213 where his Honour said:
"The proper role for prosecution appeals, in my view, is to enable the courts to establish and maintain adequate standards of punishment for crime, to enable idiosyncratic views of individual judges as to particular crimes or types of crime to be corrected, and occasionally to correct a sentence which is so disproportionate to the seriousness of the crime as to shock the public conscience."
In Everett v The Queen (1994) 181 CLR 295, McHugh J said at 306:
"Uniformity of sentencing is a matter of great importance in maintaining confidence in the administration of justice in any jurisdiction. Sentences that are higher than usual create justifiable grievances in those who receive them. But inadequate sentences also give rise to a sense of injustice, not only in those who are the victims of the crimes in question but also in the general public. Inadequate sentences are also likely to undermine public confidence in the ability of the courts to play their part in deterring the commission of crimes."
As the High Court has said, the consideration of this ground of appeal must start with a consideration of the relevant statutory provisions. I have already quoted the relevant portions of the Crimes Act, s 19B(1). Additionally, the Crimes Act, s 16A sets out the matters to which a court must have regard when passing sentence on a Federal offender. They are:
"(1)In determining the sentence to be passed, or the order to be made, in respect of any person for a federal offence, a court must impose a sentence or make an order that is of a severity appropriate in all the circumstances of the offence.
(2)In addition to any other matters, the court must take into account such of the following matters as are relevant and known to the court:
(a)the nature and circumstances of the offence;
(b)other offences (if any) that are required or permitted to be taken into account;
(c)if the offence forms part of a course of conduct consisting of a series of criminal acts of the same or a similar character – that course of conduct;
(d)the personal circumstances of any victim of the offence;
(e)any injury, loss or damage resulting from the offence;
(f)the degree to which the person has shown contrition for the offence:
(i)by taking action to make reparation for any injury, loss or damage resulting from the offence; or
(ii)in any other manner;
(g)if the person has pleaded guilty to the charge in respect of the offence – that fact;
(h)the degree to which the person has co‑operated with law enforcement agencies in the investigation of the offence or of other offences;
(j)the deterrent effect that any sentence or order under consideration may have on the person;
(k)the need to ensure that the person is adequately punished for the offence;
(m)the character, antecedents, age, means and physical or mental condition of the person;
(n)the prospect of rehabilitation of the person;
(p)the probable effect that any sentence or order under consideration would have on any of the person's family or dependants.
…
(3)Without limiting the generality of subsections (1) and (2), in determining whether a sentence or order under subsection 19B(1), 20(1) or 20AB(1) is the appropriate sentence or order to be passed or made in respect of a federal offence, the court must have regard to the nature and severity of the conditions that may be imposed on, or may apply to, the offender, under that sentence or order."

It has been said that applying s 19B involves a two‑stage approach; Federal Commissioner of Taxation v Baffsky (2001) 192 ALR 92. The first stage is to consider whether one of the factors referred to in s 19B(1)(b) of the Crimes Act is present. The second stage is to consider whether such a factor or factors, taken together, would render it inexpedient to inflict any punishment or inexpedient to inflict any punishment other than a nominal punishment or expedient to release the offender on probation.
It is not denied in this case that the character and antecedents of the respondent met the first stage of the test. The Magistrate clearly did not think that the offence was of a trivial nature or that it was committed under extenuating circumstances. He relied upon the character and antecedents of the respondent. The appellant concedes that he was justified in doing so.
However, the appellant submits that the Magistrate then failed to take into account general deterrence, the general principles relating to social security offences, the seriousness of the offence and whether there was something that took this offence out of the ordinary when applying the second stage of the test. The applicant says that the Magistrate's failure to consider these matters caused him to impose a sentence which was manifestly inadequate.
I do not accept that the Magistrate failed to take into account the seriousness of the offence. He clearly considered this because he stated that he agreed with the prosecution that it was an offence of some seriousness. However, it is true that he seems not to have had regard to general deterrence. In his reasons, when referring to s 16A, he said:
"It seems this particular section is silent in relation to the general deterrence and if I can recall correctly, there's legislation in other jurisdictions, more particularly in the Australian Capital Territory, where in fact general deterrents are not matters that should be taken into consideration ‑ ‑ or the prevalence of the offence shouldn't be taken into consideration.
But, in any event, I accept what's been said in section 16A, but it does say the deterrent effect any sentence order would have on the ‑ ‑ the deterrent effect of any sentence order under the consideration may have on the person, and I need to take ‑ ‑ to ensure that the person's adequately punished for the offence, and the character and antecedents, cultural background and any other means, physical or mental conditions of the person, and the prospects of rehabilitation, and I accept all of those."
The Magistrate did refer to the requirement of ensuring that the person, that is, the offender, is adequately punished for the offence. However, it seems to me to be inescapable from his Honour's conclusion and from his Honour's reasons that he did not believe that that included taking into account the issue of general deterrence.
This, in my view, was an error on behalf of the Magistrate. There is no doubt, having regard to the general principles applicable to sentencing for social security frauds, which are consistent with the Crimes Act, s 16A, that the sentence imposed on the respondent was very lenient. It is also true, having regard to those general principles, that general deterrence is an important issue when sentencing for such offences: R v Sinclair (1990) 51 A Crim R 418 at 430. In the case of Laxton v Justice (1985) 38 SASR 376 at 381, it was said that the following principles were relevant to sentencing offenders for social security frauds:
"(1)Offences of this type are now prevalent. The offence is difficult to detect and penalties should reflect a concern for the protection of the revenue.
(2)Frauds of this kind must be viewed seriously because they threaten the basis of the social security system which is designed to provide financial security for those in the community who are in need. A deterrent penalty is called for.
(3)It is relevant to regard a continuing series of trauds [sic] of this type as increasing the moral blameworthiness of the offender's deceits by way of contrast with single or short term offences.
(4)Whilst it may be proper in cases of first offences of this type accompanied by mitigating circumstances to impose a fine, nevertheless a custodial sentence may well be appropriate in the case of serious frauds unaccompanied by substantial mitigating circumstances."
Those principles have been applied by this Court in a number of decisions, including Nunn v Kinnon (1988) 4 WAR 459; R v Rossi (1988) 4 WAR 463; Ralph v Nawrowjee [2003] WASCA 5.
It is also true that in the respondent's case there were no circumstances relating to the offending behaviour or to the respondent herself which took her case out of the ordinary of offending of this nature. Although the Magistrate said that he decided to impose the bond on the basis of the respondent's circumstances and the nature of the offending, he also commented that a number of matters personal to the respondent were common to social security fraud offenders. For example, it is not unusual for offenders in respect to social security fraud to be single persons with dependents and otherwise of good character. Thus, there was nothing in the respondent's circumstances which were then known to the Magistrate, to take her case out of the ordinary.
Taking all these matters into account, I have come to the view that the sentence imposed by the Magistrate, having regard to the information that was before him, was manifestly inadequate.
As was said in the case of Matta v Australian Competition and Consumer Commission [2000] FCA 729 by French J, the exercise of the discretion under s 19B is exceptional. I accept that it is an exceptional case in which a court would exercise its discretion not to impose a conviction on an offender for a social security fraud offence of this seriousness. In my opinion this case simply does not disclose a set of facts, either in respect to the offence or the circumstances of the offender, which justified that sort of leniency being given to the respondent.
The bottom end of the range of appropriate penalties for this offence by this offender, having regard to the information then available to the Magistrate, was the recording of a conviction and, at the very least, the imposition of a fine. It was accepted at the sentencing hearing by the respondent and it is still asserted by the appellant that at the top end of the range an immediate sentence of imprisonment may have been imposed. I agree that it was open to the Magistrate, but it would have been a sentence right at the top end of the range of appropriate sentences. If a sentence of imprisonment was imposed it would have been more appropriate to suspend such a sentence.

Conclusion

Consequently the appellant has made out ground 1 of the grounds of appeal. It is, therefore, unnecessary for me to consider the remaining grounds of appeal.
The proper order is to allow the appeal. The respondent now needs to be re‑sentenced on the basis of her current situation.
The Criminal Appeals Act 2004 (WA) makes it clear that in re‑sentencing an offender after a successful appeal the current circumstances of the offender are to be taken into account. I am told by the appellant's counsel that the respondent's personal circumstances may have changed. She may be now suffering from an illness which is compromising her ability to work and to repay a fine or to be suitable for any particular type of disposition. However, I do not have any firm information before me and certainly no evidence before me about the respondent's current position. I have been told that she has repaid very little of the reparation order.
Although the respondent has chosen not to appear before me, justice dictates that I give her the opportunity to provide me with the relevant information about her personal circumstances before I re‑sentence her. I will hear counsel as to how that may be achieved. Pursuant to the Criminal Appeals Act 2004 (WA), s 40 and s 41, I have the power to summons the respondent to appear before me for the purposes of re-sentencing. My view is that it is appropriate for me to exercise this power.
I could remit the matter to the Magistrates Court for re-sentencing. It seems to me that as I have determined the appeal and have had to look at the matter in some detail, it would be preferable if I concluded the sentencing process.
I will hear counsel as to the appropriate orders.

[2007] WASC 137

29 MAY 2007

Key Legal Topics

Areas of Law

Criminal Law

Legal Concepts

Appeal

Criminal Liability

Sentencing