O'Dwyer v The King

Case •

[2025] NSWCCA 95

•

23 June 2025

Court of Criminal Appeal


Supreme Court


New South Wales

Medium Neutral Citation: O’Dwyer v R [2025] NSWCCA 95
Hearing dates: 11 April 2025
Decision date: 23 June 2025
Before: Mitchelmore JA at [1];
Rothman J at [62];
Yehia J at [63].
Decision:

(1)   Leave to appeal against sentence is granted.

(2)   The appeal is dismissed.

Catchwords:

CRIME – appeals – appeal against sentence – dishonestly obtain financial advantage by deception – contravention of section 192E(1)(b) Crimes Act 1900 (NSW) – whether breach of De Simoni principle – where advantage particularised was the obtaining of loan facilities – where sentencing judge assessed objective seriousness by reference to quantum and period of drawdowns of facilities – whether objective seriousness assessed by reference to criminality comprising a more serious offence

CRIME – appeals – appeal against sentence – whether sentencing judge failed to take into account “risk management” – whether sentencing judge failed to take into account absence of loss – where applicant sought to rely on loan facilities as security for the amount drawn down

CRIME – appeals – appeal against sentence –whether sentence manifestly excessive

Legislation Cited:

Crimes Act 1900 (NSW), ss 192E, 193B

Crimes (Sentencing Procedure) Act 1999 (NSW), s 21A

Cases Cited:

R v Todorovic [2008] NSWCCA 49

R v Woodman [2001] NSWCCA 310

The Queen v De Simoni (1981) 147 CLR 383; [1981] HCA 31

Turkmani v The Queen [2014] NSWCCA 186; 244 A Crim R 402

Category:Principal judgment
Parties: William O’Dwyer (Applicant)
Commonwealth Director for Public Prosecutions (Respondent)
Representation:

Counsel:
A Francis, I Hogan (Applicant)
D New (Respondent)

Solicitors:
One Group Legal (Applicant)
Commonwealth Director for Public Prosecutions (Respondent)
File Number(s): 2023/00205738
 Decision under appeal 
Court or tribunal:
District Court
Jurisdiction:
NSW
Citation:

[2024] NSWDC 11

Date of Decision:
02 February 2024
Before:
Anderson SC DCJ
File Number(s):
2023/205738

HEADNOTE

[This headnote is not to be read as part of the judgment]

The applicant, William O’Dwyer, sought leave to appeal against the sentence imposed on him in the District Court by Anderson SC DCJ in relation to six counts of dishonestly obtaining a financial advantage by deception contrary to s 192E(1)(b) of the Crimes Act 1900 (NSW) to which he pleaded guilty. The sentencing judge imposed an aggregate term of imprisonment of 4 years, commencing on 2 February 2024 and expiring on 1 February 2028, with a non-parole period of 2 years and 4 months expiring on 1 June 2026.

The offences involved conduct on the part of the applicant in obtaining loan facilities from St George Bank Ltd and Wingate Pty Ltd (the Lenders) on behalf of three development companies of which he was the sole director, in order for those companies to carry out separate residential development projects. The applicant deceived the Lenders into believing that pre-sale deposits received from purchasers of off-the-plan units in the development projects were held by the development companies in trust accounts and were not the subject of any side agreements. He also deliberately concealed the true state of affairs from the Lenders through the provision of misleading trust account ledgers and schedules of pre-sale deposits, and other documentation that attested to satisfaction of the pre-conditions of the loan facilities, in circumstances where he knew that the documents were misleading and would be relied upon by the Lenders.

The applicant sought leave to appeal from the sentence imposed on the following grounds:

  1. Ground 1: The sentencing proceedings miscarried by reason of the prosecutor's reliance upon the agreed facts in a way that characterised the criminality as giving rise to more serious offences (being offences against s 193B of the Crimes Act), and the sentencing judge fell into error in assessing the objective seriousness of each of the offences by having regard to facts which gave rise to more serious offending, in breach of the principle in The Queen v De Simoni (1981) 147 CLR 383; [1981] HCA 31 (“De Simoni”).

  2. Ground 2: The aggregate sentence imposed was manifestly excessive.

  3. Ground 3: The sentencing judge erred in assessing the objective seriousness of each of the offences as underpinned by an evaluation of the amount of the drawdowns and the period of time over which they were made; and by failing to take into account the responsible management of the drawdowns in this objective context. This ground proceeded on the premise that ground 1 was rejected and the sentencing judge was able to rely on the amount and period of the drawdowns.

The Court held per Mitchelmore JA (Rothman J and Yehia J agreeing), granting leave to appeal and dismissing the appeal:

As to Ground 1: It was clear from the manner in which his Honour referred to the period and quantum of the drawdowns that his Honour did not consider these to be matters that aggravated the objective seriousness of the offending. Rather, his Honour considered these to be matters that were beneficial to the applicant on sentence. The contention that his Honour sentenced the applicant in relation to the later in time offending for criminality involved in a s 193B(1) offence rested on a misreading of his Honour’s reasons: at [45]-[52].

The Queen v De Simoni (1981) 147 CLR 383; [1981] HCA 31; Turkmani v The Queen [2014] NSWCCA 186; 244 A Crim R 402, considered. R v Todorovic [2008] NSWCCA 49; R v Woodman [2001] NSWCCA 310, applied.

As to Ground 3: The arguments advanced in support of Ground 3 did not properly reflect the totality of the sentencing judge’s reason. It is clear from a fair reading of the sentencing remarks that his Honour considered the absence of loss in the context of objective seriousness. To the extent that the applicant relied upon his conduct in maintaining an amount of security at least equal to the amount the Lenders required to be held on trust, as evidencing “risk management” on his part, this relied upon a misconceived understanding of the effect of applicant’s deception on the transactions in question. The Lenders were looking for something independent as security for the debt, not the amount available in the facilities: at [53]-[58].

As to Ground 2: Ground 2 relied primarily on the success of the arguments advanced in support of ground 1 and failed on that basis. As to the applicant’s reliance on the sentencing judge not expressly revisiting his findings on objective seriousness after finding that the absence of loss was a mitigating factor for the purpose of s 21A(3)(a) of the Crimes (Sentencing Procedure) Act 1999 (NSW), this relied upon the same reading of his Honour’s reasons advanced in support of Ground 3, and failed for reasons addressed in relation to that ground: at [59]-[60].

JUDGMENT

  1. MITCHELMORE JA: The applicant, William O’Dwyer, pleaded guilty to six counts of dishonestly obtaining a financial advantage by deception contrary to s 192E(1)(b) of the Crimes Act 1900 (NSW). In broad outline, the offences involved conduct on the part of the applicant in obtaining loan facilities on behalf of three development companies of which he was the sole director, in order for those companies to carry out separate residential development projects.

  2. On 2 February 2024, the applicant was sentenced in the District Court by Anderson SC DCJ to an aggregate term of imprisonment of 4 years, commencing on 2 February 2024 and expiring on 1 February 2028, with a non-parole period of 2 years and 4 months expiring on 1 June 2026. He seeks leave to appeal from the sentence imposed on the following grounds:

  1. The sentencing proceedings miscarried by reason of the prosecutor's reliance upon the agreed facts in a way that characterised the criminality as giving rise to more serious offences, in breach of the principle in The Queen v De Simoni (1981) 147 CLR 383; [1981] HCA 31 (“De Simoni”); and the sentencing judge fell into error in assessing the objective seriousness of each of the offences by having regard to facts which gave rise to more serious offending, in breach of De Simoni.

  2. The aggregate sentence imposed was manifestly excessive.

  3. The sentencing judge erred in assessing the objective seriousness of each of the offences as underpinned by an evaluation of the amount of the drawdowns and the period of time over which they were made; and by failing to take into account the responsible management of the drawdowns in this objective context.

  1. Although ground 1 and ground 3 (which was added by later amendment) appeared internally inconsistent, counsel for the applicant clarified at the hearing that the error that is alleged in ground 3 proceeds on the premise that ground 1 is rejected and the sentencing judge was able to rely on the amount and period of the drawdowns. Counsel also clarified at the hearing that ground 2 was independent of the other two grounds, even though the applicant’s written submissions did not advance separate arguments in respect of it and only brief oral submissions were addressed to it.

  2. For the reasons that follow, I do not consider that the applicant’s grounds of challenge to the sentence have been made good. Accordingly, although I would grant the applicant leave to appeal against his sentence, I would dismiss the appeal.

The charges and the offending conduct

  1. The Crown tendered a detailed statement of facts (Exhibit A). However, the sentencing judge observed in his reasons that “notwithstanding its length”, the statement of facts “did not actually address the six specific offences for which the offender had pleaded guilty”: at [5]. At his Honour’s request, a supplementary document was prepared which set out, for each sequence, the date range, the factual basis, the financial advantage obtained, the drawdowns made and the applicant’s conduct in obtaining the financial advantage (Exhibit C). His Honour took both Exhibit A and Exhibit C into account in preparing his reasons: at [5].

  2. Exhibit A indicates that at the time of the offending the applicant was the managing director and founder of a group of companies known as the Ralan Group, which were involved in the sale, marketing and development of off-the-plan residential real estate. As the sentencing judge explained at [6], the six charges to which the applicant pleaded guilty covered the period between April 2015 and June 2018 and related to loan facilities advanced to three companies in the Ralan Group, of each of which the applicant was the sole director:

  1. Ralan Cecil Street Pty Ltd (Ralan Cecil Street), which was the development entity for a site in Cecil Street, Gordon;

  2. Ralan Lamond Pty Ltd (Ralan Lamond), which was the development entity for a site in Lamond Avenue, Turramurra; and

  3. Ralan Arncliffe Pty Ltd (Ralan Arncliffe), which was the development entity for a site in Townsend Place, Arncliffe.

  1. The lenders of the facilities in question were Wingate Pty Ltd (Wingate) and St George Bank Ltd (St George), which the sentencing judge referred to collectively as “the Lenders”: at [6]. His Honour summarised the applicant’s dishonest conduct in a manner with which neither party took issue on the appeal:

“[7] The simplest explanation of the dishonest conduct undertaken by the offender is that he deceived the Lenders in two ways. Firstly, he deceived the Lenders into believing that the 10% pre-sale deposits which were received from purchases (‘the pre-sale deposits’) were held in a trust account, known as the Ralan Property Services Trust Account, when in fact, the deposits had been loaned by the purchasers back to the offender’s development companies for use as working capital for a fee as part of a side agreement.

[8] Secondly, during what is described as the Second Phase or Audit phase, the offender deliberately concealed from the Lenders the existence of the side agreements with the purchase[r]s. The side agreements with purchase[r]s were that purchase[r]s could agree to release the deposit money that they provided to the offender, and which should have been held on trust as security for the Lenders, but was in fact released out of the trust account as loans to offender’s companies.

[9] To expand on this second aspect, a standard minimum 10% deposit was required to be paid by each purchaser to the relevant development entity. That amount was to be held on trust. Around the time that contracts were exchanged for the purchase of the units off the plan, the offender, or his agent, would approach the purchaser and ask whether they would be prepared to consent for that deposit to be used as an unsecured loan towards the development. Interest would be paid to the purchaser, typically at 15%, and that money would be credited towards the purchase price of the unit at the time of the settlement.

[10] If the purchaser agreed to release their presale deposit, a release agreement was signed by the offender and the purchaser. The offender personally guaranteed the unsecured loans. The release of the deposits was properly recorded in the balance sheet of each of the three development entities. Once the presale deposits had been released to the development entity, they were used as working capital by that or other companies controlled by the offender.”

  1. The letters from the Lenders containing indicative offers for the facility agreements each referred to conditions precedent which included, relevantly for present purposes, a review of deposit information. It was a condition of the facility agreements being finalised and the facilities being made available that the relevant development entity had entered into “qualifying” pre-sale contracts of a certain gross sales value. A “qualifying” pre-sale contract was defined as a sale contract which provided for a minimum 10% non-refundable pre-sale deposit that was held on trust and in respect of which there were no side agreements.

  2. The applicant was responsible for the documents provided to the Lenders as part of their due diligence: at [11]-[12]. He knew that in order to ensure the preconditions to the loans were met, the Lenders would require, and would rely on, a schedule of pre-sale deposits which was to state the fact and amount held in trust in respect of each exchanged contract and where the funds were held, and which was connected to the trust account ledgers: at [11]. The schedules of deposits he provided to the Lenders were misleading, to his knowledge, as they listed the receipt of the purchaser deposits but not their subsequent release: at [12]. The trust account ledgers provided to the Lenders were also misleading, to his knowledge, as they recorded the deposit of funds but not their subsequent withdrawal: at [12].

  3. His Honour summarised the applicant’s deception and dishonesty as involving the following at [13]:

“(1)   signing Warranties and Irrevocable directions in relation to two of the developments and for the third, certifying presale certification levels with attached irrevocable directions and authorisations that the presale deposits were to be held in trust accounts with no side agreements. These are referred to as the pre-conditions.

(2)   certifying the accuracy of schedules presented to the Lenders setting out presale deposits in circumstances where he knew they were false because the deposits which the schedules said were held in the trust accounts were not in fact held and had been released via a separate side agreement between the relevant development company and the purchaser.

(3)   providing to the Lenders misleading trust ledgers in relation to each of the three developments. The trust ledgers were misleading in the sense that while they recorded trust account deposits, they did not record withdrawals from the accounts. I will detail this issue shortly.

(4)   Fourthly, by not disclosing to the Lenders the fact that there are (sic) had been a release of the presale deposits via the release agreements.”

  1. Across all of the facility agreements, the applicant was required to hold $25,831,000 in trust accounts for the three development entities, which represented about 10% of the total value of pre-sales of $258,317,000: at [14]. As a result of the applicant’s deception, the Lenders believed that the preconditions regarding purchaser deposits had been satisfied and on that basis agreed to advance the facilities: at [17].

  2. In total, $251 million in facility agreements were put in place between the applicant and the Lenders with respect to the three development projects (which had a combined value of $376,550,000): at [14]. A total of $132,369,000 was drawn down on the facilities to finance construction: at [15]. The sentencing judge stated that it was important to note “that all of the amounts of money involved were either repaid or expected to be repaid to the Lenders”, and that “[n]o purchasers have been left out of pocket either”: at [14].

  3. After setting out this summary of the offending conduct, the sentencing judge addressed each of the sequences. Sequence 1 related to the Ralan Cecil Street development. The lender was St George. The date range particularised in the Court Attendance Notice (and Exhibit C) was between about 17 April 2015 and 17 January 2017, which the sentencing judge noted represented the longest individual period in the sequences: at [18]. Those two dates corresponded with the date the letter of offer in respect of the facility agreement was signed and the date of the last drawdown. The financial advantage in the particulars was “the obtaining of, and ability to draw down on, a loan facility from St George”. His Honour noted that the amount of the loan facility was $17.42 million and that “he had the ability to draw down that amount, although in fact the drawdowns paid was $9.53 million”: at [19].

  4. Sequence 2 also related to the Ralan Cecil Street development, with the lender being Wingate: at [21]. The date range particularised was between about 24 April 2015 (the date that the applicant signed the letter of offer) and about 3 July 2015 (the date that the applicant signed and sent to Wingate the Warranty and Irrevocable direction): at [20]. His Honour described the financial advantage obtained as “$4.65 million, being the amount the offender had the ability to draw down”. His Honour then noted that, “[i]n fact, $3.6 million was used”: at [22].

  5. Sequence 3 related to the Ralan Lamond development and “the obtaining of, and ability to draw down on, a loan facility from St George”: at [24]. The date range for sequence 3 was between about 26 June 2015 (the date the letter of offer in respect of the facility agreement was signed) and about 24 September 2015 (the date of the first drawdown). His Honour described the financial advantage obtained “by way of the total drawdowns available was $30.3 million, but the actual drawdown was $27.67 million”: at [24].

  6. Sequence 4 also related to the Ralan Lamond development and “the obtaining of, and ability to draw down on, a loan facility from Wingate”: at [25]. The date range for sequence 4 was between about 14 July 2015 (the date the applicant signed the Warranty and Irrevocable Direction) and about 19 September 2015 (two days after the first drawdown on the facility). The sentencing judge described the financial advantage obtained as “the total drawdown available of $7.95 million, but the actual drawdown was $6 million”: at [25].

  7. Sequence 5 related to the Ralan Arncliffe development, with the lender being St George and the date range between about 19 February 2018 (the date on which the applicant sent St George a presales certification letter) and about 4 June 2018 (the date of the first drawdown on the facility). The sentencing judge described the financial advantage obtained as “$95.1 million, but the drawdowns paid was substantially less, at $16.65 million”: at [27].

  8. Sequence 6 also related to the Ralan Arncliffe development, with the lender being Wingate. The date range was between about 5 April 2018 (the date the applicant signed the letter of offer) and about 6 June 2018 (the date of the first drawdown): at [28]. The financial advantage obtained “was the ability to draw down $96.1 million, but the drawdowns paid: $68.9 million”: at [28]. As the sentencing judge observed, this represented the largest single loan facility: at [28].

  1. In July 2019, the Ralan Group entered into administration: at [30]. The applicant offered a deed of company arrangement (DOCA) proposal to creditors, which the creditors voted in favour of. However, it was a condition of the DOCA that it would terminate if any creditor took personal action against the applicant, which eventuality occurred. The DOCA terminated and a liquidator was appointed to the Ralan Group in about February 2020. The liquidator identified that the applicant had longstanding shareholder loans with entities in the Ralan Group totalling over $19 million, the liquidator’s pursuit of which resulted in the applicant being declared bankrupt in July 2021. However, as the sentencing judge noted, it was not alleged that the shareholder loans formed any part of the offending conduct: at [31]. The applicant at all times cooperated with the investigation undertaken by the Australian Securities and Investments Commission which led to the charges: at [32].

The sentence

  1. At the start of his Honour’s reasons, his Honour stated, in a passage that has some relevance to the third ground of appeal and the allegation of latent error that apparently forms the basis of the allegation that the sentence was manifestly excessive:

“[3] It is worth stating at the outset that an offence under section 192E(1)(b) can occur either because a person has, by any deception, dishonestly obtained a financial advantage OR causes any financial disadvantage. Here, the offences involve the offender dishonestly obtaining a financial advantage by deception NOT that he caused any financial disadvantage.

[4] The obtaining of the financial advantage must be the result of the offender’s deception, but it is not necessary to show that the person deceived actually suffered the loss: R v Ho [(1989) 39 A Crim R 145]. In other words, a financial advantage can be obtained by an offender even when there is no financial disadvantage suffered by any victim, as is the case here."

  1. At the outset of the section headed “Sentencing Principles”, his Honour noted that he had taken into account the maximum penalty for the charge (10 years imprisonment) and considered the factors in s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW) (the Sentencing Procedure Act): at [33]. His Honour accepted the applicant’s submission “that this is NOT a matter where specific deterrence is of great importance”, with the applicant being 58 years old and having no criminal record: at [33]. Nonetheless, the principles of punishment, general deterrence, accountability and denunciation of the conduct remained important, with his Honour accepting the Crown’s submission that the difficulty in detection and the ease with which offences such as these could occur required the Court to send a message that the punishment outweighs the potential financial benefit of the crime: at [34]-[35].

  2. Under the heading “Objective Seriousness”, his Honour referred to a number of authorities dealing with s 192E(1)(b) of the Crimes Act and identified the following considerations as relevant to the assessment of objective seriousness for offences of this nature (at [37]):

“(1)   The advantage obtained by the offender;

(2)   whether the loss is retrievable;

(3)   the length of time over which the deception occurs;

(4)    motive;

(5)   the planning and sophistication; and

(6)   whether there is a breach of trust.”

  1. His Honour noted that although the offences were committed as part of a course of conduct spanning just over three years, each offence was to be assessed individually, “hence the Court’s request for what became Exhibit C”: at [38]. Nonetheless, before addressing the individual charges his Honour made “some overall findings which apply to all of the charges as part of my determination of what the appropriate level of objective seriousness is”: at [39].

  2. First, his Honour accepted the Crown’s submission that the applicant’s conduct was intentional, rather than reckless, making his conduct more objectively serious (the applicant’s senior counsel accepted this at the proceedings on sentence): at [40]. His Honour stated in this regard:

“[41] In April 2015, when the offender first negotiated the loan facilities and began negotiating with purchasers regarding accessing, their deposits, the offender was in a position of control over the deals with the Lenders and purchasers. He was well aware that his conduct in entering into the side agreements with purchasers was contrary to his contractual obligations with the Lenders. Not only was he aware of the requirements for purchasers’ deposits to be held on trust, but he also actively deceived the Lenders into believing his companies had complied with that requirement during the audit phase.

[42] Central to the deception was the presentation to Lenders by the offender during that audit phase of documents purporting to demonstrate that the buyers’ deposits were being held in a trust account as required. The documents presented by Mr O’Dwyer to the lenders was deliberately false and was both generated to provide false information and thus facilitating the deception.

[43] The Crown described the documents as having been doctored. For reasons that were more semantic than anything else, the offender took issue with that description. It is hard to understand why. The reality was that the documents were ‘doctored’ by the Offender in order to present a false picture to the Lenders by deliberately omitting [from] transaction schedules the fact that purchaser’s deposits had been withdrawn from the Ralan Group trust accounts. This is the heart of the criminality and presumably why Mr O’Dwyer pleaded guilty.”

  1. His Honour then addressed the considerations that he had identified from the various authorities. His Honour started with the advantage obtained by the applicant, opening his consideration of that topic with the following observation at [44] which is relevant to the first ground of appeal:

“On one view, the benefit obtained by the offender is the total sum involved in the loan facilities, being $251 million, but it was $132[.]369 million which was actually drawn down to finance the developments. Of course, the criminality related to the improper release of $25.831 million in trust accounts for the three developments.”

  1. His Honour noted that both parties had addressed “whether the offender’s conduct created a level of risk to the Lenders”: at [45]. The Crown submitted that the applicant’s conduct involved “risky and deceptive business practices” and that this was a systemic fraud designed to deceive Lenders of over $251 million, which created a risk for unsecured creditors while the applicant received the benefit of continuing to have access to credit allowing the businesses to continue operating: at [45]. The Crown also referred to the indirect benefit the applicant received in terms of wages and the $19 million in shareholder loans; and it relied on the group being placed in liquidation as an example of the risk that existed for businesses of this type: at [46]. The applicant, on the other hand, submitted that the fraudulent transactions “did not result in any material benefit that flowed directly to the offender, rather the money was used towards the development costs”. The applicant also submitted that the Lenders were never truly exposed to any real risk because of the level of pre-sale purchases for the three developments. Further, no party suffered any loss, the Lenders and the purchasers who lent their deposits having been repaid or soon to be repaid: at [47].

  2. His Honour’s conclusion regarding these submissions was as follows:

“[48] The issue of whether there was a risk to the Lenders is, in my view, largely irrelevant when it comes to assessing the objective seriousness of the offending. The nature of these six offences is that the offender has dishonestly obtained a benefit. The reality is that the Lenders required certain steps to be taken before they would advance funds. Whether, as a matter of practicality, that requirement was unnecessary because of the level of deposits and presales, is irrelevant. The simple fact was that the offender gave undertakings to the Lenders and then dishonestly represented his compliance with that requirement, knowing full well that he was non-compliant.

[49] The benefit received by the offender was that his businesses were able to undertake and complete the three developments. That is clearly a significant personal benefit to him, as well as well as the Lenders and the purchasers.

[50] I accept the Crown’s submission that it was a figure of $132.3 million drawn down from the loan facilities and used by the offender, which was the direct financial advantage that he obtained. Often in fraud cases the size of the advantage or disadvantage in dollar terms becomes the focus of assessment for objective seriousness. However, while that is the ‘headline’ figure of the dishonesty, the offender did not personally obtain any advantage beyond simply allowing the developments to reach completion, which benefited himself, the Lenders, and purchasers.

[51] In my view, the quantum of the benefit does not by itself automatically place the matter at the absolute highest end of objective seriousness, but clearly plays a substantial role in the Court’s ultimate conclusion that these are very serious offences.”

  1. The second factor his Honour identified, “whether the loss is retrievable”, was a consideration referred to in a number of the cases his Honour cited in [37], including R v Woodman [2001] NSWCCA 310 (“Woodman”) and R v Todorovic [2008] NSWCCA 49. In Woodman, Wood CJ at CL dismissed a ground of appeal alleging that the sentencing judge had given insufficient weight to the applicant’s offer to make reparation. In that context, Wood CJ at CL referred with approval at [33] to the observation of Hunt CJ at CL, in R v Phelan (1993) 66 A Crim R 446, that “[i]t is more of a matter of aggravation when there has been a loss which is effectively irretrievable than a matter of mitigation where the loss has been made good". These authorities provide necessary context for the sentencing judge’s finding at [51], that: “There was no loss, so this consideration is irrelevant with respect to these offences.” His Honour further observed at [51] that “[h]ad there been a loss, it would have been another charge”, which appears to be a reference to his Honour’s comment about the nature of the charge in [3] of the reasons.

  2. The next factor was the length of time over which the deception occurred, which the sentencing judge noted could indicate the degree of planning and to show that the offence was not impulsive. His Honour recognised that although the overall period of offending in this case was over three years, the periods of criminality for each offence were substantially less: at [53].

  3. His Honour next addressed motive, noting that fraud offences are often approached “from the perspective of whether the offence was done for need or greed”. His Honour recognised that the present conduct was “really neither”: at [54]. His Honour expressly rejected the Crown’s submission that the offences were undertaken to keep the business running, with the applicant preferring to risk the Lenders’ and purchasers’ interests over his own benefit. His Honour agreed the money was used to keep the developments going, but also recognised that “the successful completion of the developments was in everyone’s interest, particularly the offender, the lenders and the purchasers”: at [54].

  4. In relation to sophistication and planning, the sentencing judge found that overall the offences were unsophisticated, “as the criminality was as simple as giving an undertaking to [the] Lenders not to do something, then breaching that undertaking with the purchasers via the manipulation of the ledgers during the audit period”: at [57]. However, his Honour found that sequences 5 and 6 were more objectively serious because by the time they were committed the applicant was confident that his dishonest conduct in sequences 1, 2, 3 and 4 could continue: at [56].

  5. As to breach of trust, his Honour noted that the cases in which, traditionally, a breach of trust has been regarded as exacerbating criminality involve a victim reposing trust in the offender, such as a client in his or her accountant or solicitor, or someone defrauding an employer (his Honour had referred to a number of such cases in [37]). His Honour did not consider the present offences involved a breach of trust along those lines: at [58].

  6. Having dealt with these considerations, his Honour turned to the individual offences. His Honour considered that “the overall level of dishonesty and deception” was the same for Sequences 1, 2, 3 and 4 but slightly greater for Sequences 5 and 6, given that at the time those offences occurred the applicant knew he would ultimately breach the arrangements he had entered into with the Lenders: at [60]. His Honour also considered that the sequences were distinguishable in terms of the length of time over which they occurred, and the differing level of financial advantage obtained: at [60]. His Honour continued:

“[61] I make the following findings with respect to the objective seriousness with respect to each of the six offences, taking into account my earlier general findings about the offences.

Sequence 1

[62] The offending conduct in this case was the longest, at 21 months, running between 17 April 2015 and 17 January 2017. He used $9.53 million in drawdowns. I find this offence falls above the mid-point of objective seriousness because of the length of time over which the offence occurred and the amount of money involved.

Sequence 2

[63] The offending conduct in this case was the equal shortest at 2 months, running between 24 April 2015 and 3 July 2015. The amount involved of the drawdowns was $3.6 million. I find this offence falls below the mid-point of objective seriousness and is the least serious of the offences because of the short period of time involved and because of the small amount, relatively speaking, of this particular drawdown.

Sequence 3

[64] The offending conduct in this case was for three months, running between 26 June 2015 and about 24 September 2015. In this instance the offender used $27.67 million in drawdowns towards the development, all of which was repaid, as it was with the others. I find this offence falls at the mid-range of objective seriousness because of the short period over which the offence occurred, but taking into account the fact that it was a larger amount of money used as the drawdown.

Sequence 4

[65] The offending conduct in this case was just two months, running between 14 July 2015 and 19 September 2015. The amount involved was $6 million in drawdowns, all of which was repaid. I find this offence falls below the mid-point of objective seriousness because of the short period over which the offence occurred and again, relatively speaking, being one of the smaller amounts of the drawdowns.

Sequence 5

[66] The offending conduct in this case was three and a half months, running between 19 February 2018 and 4 June 2018. By this point in time the first four offences had been successfully completed without consequence. In this instance, the offender used $16.65 million in drawdowns towards the development. Again, it was repaid. Taking into account matters I have already addressed and the specifics for sequence 5, I find this offence falls above the mid-point of objective seriousness. This is because it was over short period of time, but for a larger amount of money.

Sequence 6

[67] The offending conduct in this case was only two months, running between 5 April 2018 and 6 June 2018. Again, by this point in time the first four offences had been successfully completed without consequence. This was the largest of the drawdowns at $68.9 million, all of which was repaid but I find this offence falls above the mid-point of objective seriousness because, while it was over short period of time, it is by far the largest amount of money relative to the other offences.”

(Emphasis added.)

  1. The sentencing judge then turned to the factors in s 21A(2) and (3) of the Sentencing Procedure Act. His Honour rejected the Crown’s submissions that the offending engaged the aggravating factors in s 21A(2)(m) (the offence involved a series of criminal acts), and s 21A(2)(n) (the offence was part of a planned criminal activity): at [69]-[70]. His Honour accepted the applicant’s submissions that a number of mitigating factors were engaged. First, as to s 21A(3)(a) (the loss caused by the offence was not substantial), his Honour accepted that there was no loss occasioned as a result of the offending conduct (as was already apparent from [4] of the reasons and his Honour’s findings on the objective seriousness of the individual sequences that I have extracted above). His Honour stated that the applicant could have obtained a benefit while also causing a loss but in this instance, he only obtained a benefit: at [71]. His Honour also found that s 21A(3)(e) (no prior criminal record) and s 21A(3)(f) (good character) were satisfied: at [72]. His Honour was also satisfied as to s 21A(3)(b) (unlikely to reoffend), noting the applicant’s good prospects of rehabilitation and his remorse: at [72].

  2. The sentencing judge had regard to the material the applicant filed on his subjective case, which included a report of Dr George Lianos, psychiatrist, dated 3 November 2023, affidavits from his wife and eldest daughter, various testimonials, a letter of apology that the applicant wrote, and a letter of assistance from the liquidator: at [82]. His Honour also received a Sentencing Assessment Report dated 22 November 2023, which was “very positive and demonstrates that the offender has taken full responsibility for his criminal conduct and is assessed as a low risk of reoffending”: at [83].

  3. The sentencing judge accepted that the applicant was genuinely contrite and remorseful, consistently with his plea at the earliest opportunity and his cooperation with authorities, although noted that the applicant was silent in his letter about the three developments that were the subject of the criminal proceedings and his state of mind at that time of the offending: at [92]-[95]. His Honour noted that the testimonial evidence (and the affidavits of the applicant’s wife and daughter) also made no reference to the offending for which the applicant was before the court, but accepted, as I have noted above, that the applicant was a person of good character: at [85], [97]-[98].

  4. Dr Lianos diagnosed the applicant as suffering from post-traumatic stress disorder with, amongst other things, chronic anxiety, panic attacks, feelings of hopelessness, depression, recurrent intrusive thoughts and oceans of despair. The sentencing judge described Dr Lianos’ conclusions as not sitting easily with the other evidence before the Court: at [112]. Notwithstanding Dr Lianos’ view that there was a causal connection between the offending and the applicant’s mental health, his Honour did not find that the offending occurred at a time when the applicant was suffering the degree of mental impairment now identified: at [113]. His Honour reached that view for a number of reasons, including because it involved retrospectively diagnosing a condition that was said to be causative of the offending which was contradicted by other evidence, stating at [114]:

“The fact is that the offender deliberately represented to Lenders a particular state of affairs concerning how purchaser deposits would be held by his companies commencing in April 2015. He gave undertakings not to create any side arrangements with other parties on six occasions over three years. This was no mere aberration. Not only is it not an aberration, it very much appears to be a highly rational and considered business model designed to access funds he was not otherwise entitled to access.”

  1. It was the case that the applicant found himself in difficult financial circumstances in 2014, when a development in St Leonards in which he was involved went into administration, leaving many subcontractors out of pocket and leading to the applicant being subjected to intimidation, threats and public humiliation at the hands of the Construction, Forestry, Mining and Energy Union. The sentencing judge had “absolutely no difficulty accepting that that could cause post-traumatic stress disorder which could last for years”, but could not reconcile the severe mental illness that Dr Lianos described as robbing the applicant of his normal capacity to exercise reason and make rational decisions with the applicant simultaneously commencing the Ralan Cecil Street and Ralan Lamond developments, buying enough land on the Gold Coast to build six tower blocks (commencing and completing one tower before 2017) and in 2018 successfully undertaking the Ralan Arncliffe development: at [119].

  2. Additionally, Dr Lianos’ report referred to the applicant feeling concerned for investors, which did not appear to relate to the offences before the Court: at [116]. As his Honour noted, “the fact that the Lenders and purchasers were all satisfied at the end of the development was a significant part of the offender’s submissions before the Court”: at [116]. The significant mental health decline of which the applicant’s wife and eldest daughter gave evidence occurred in 2019, not during the charge period.

  3. The sentencing judge rejected the applicant’s submission “that his moral culpability and its role in the assessment of objective seriousness be reduced because of his mental illness that is now described”: at [121]. However, his Honour took the applicant’s conditions into account in finding that he would find custody particularly onerous, and as somewhat mitigating general and specific deterrence: at [121]. In so far as the applicant relied on a background of social deprivation and disadvantage as a child, his Honour did not accept that there had been childhood deprivation such as to lessen his moral culpability for the offending: at [125]-[126]. His Honour accepted that the applicant was put in a state of uncertain suspense as a result of the delay of five years between the last date of the offences and the charging in June 2023: at [127]-[128].

  4. His Honour found that the applicant had excellent prospects of rehabilitation: at [129]. On the basis of his existing mental health condition, his age and this being his first offence, the sentencing judge found special circumstances warranting a non-parole period ratio of 60%: at [132]. His Honour acknowledged that there would be a large measure of accumulation reflected in the aggregate sentence, considering the offences involved identical methodology and the same two Lenders (even though each offence was committed over a discrete period, with separate documents and fraudulent conduct across three projects): at [133].

  5. It was conceded that the threshold in s 5 of the Sentencing Procedure Act had been crossed but the applicant submitted that the sentence should be three years or less and that an intensive correction order would be appropriate: at [135]. The sentencing judge stated that he had given that submission significant consideration but ultimately rejected it, stating at [136]:

“In my view, these are offences which do warrant the offender to actually serve time in custody. This is because of the objective seriousness of the offences, taking into account the enormous size of the financial advantage received by the offender, even when consideration is given to the fact that the money was spent appropriately on construction costs and there was no loss to any party. The reality is that the Lenders were entitled to believe that the offender would honour his contractual undertakings and, rely on the documents provided to them by the offender. The offender’s conduct was an ongoing, deliberate and calculated fraud designed to benefit himself through deliberately misrepresenting his companies trust account to its Lenders, not once but on six occasions over three years.”

(Emphasis added.)

  1. The sentencing judge found that the applicant was entitled to the full discount for his plea of guilty to each offence charged, as well as finding a further discount. The sentencing judge gave the following indicative sentences in respect of each of sequences 1 to 6, with some rounding: at [137]

“(1)   Sequence 1: 2 years and 7 months’ imprisonment. But for the discount, the sentence would have been 4 years, 6 months.

(2)   Sequence 2: 1 year and 5 months’ imprisonment. But for the discount, the sentence would have been 2 years, 6 months.

(3)   Sequence 3: 2 years and 3 months’ imprisonment. But for the discount, the sentence would have been 4 years.

(4)   Sequence 4: 2 years and 3 months’ imprisonment. But for the discount, the sentence would have been 4 years.

(5)   Sequence 5: 2 years and 8 months’ imprisonment. But for the discount, the sentence would have been 4 years, 9 months.

(6)   Sequence 6: 3 years and 1 months’ imprisonment. But for the discount, the sentence would have been 5 years and 6 months.”

The grounds of appeal

  1. I will first address ground 1 and then ground 3. I will address ground 2 last because to the extent that it was put independently of ground 1, it alleged latent error on the basis of reasoning that was also relevant to grounds 1 and 3.

Ground 1: the sentencing proceedings miscarried because the prosecutor relied on the agreed facts in a way that gave rise to more serious offences; and the sentencing judge fell into error in assessing the objective seriousness of each offence by reference to facts which gave rise to more serious offending, in breach of the principle in De Simoni

  1. The applicant contended that the sentencing judge erred in his assessment of objective seriousness by taking into account not only the applicant’s conduct in obtaining the approval for the loan facilities, but also his conduct in drawing down on those facilities. The applicant submitted that the latter conduct exceeded the elements of the offence under s 192E(1)(b) and constituted the more serious offence of dealing with proceeds of crime under s 193B, in contravention of the principles in De Simoni. An offence against s 192E(1)(b) is subject to a maximum penalty of 10 years imprisonment. By contrast, the offence of dealing with proceeds of crime under s 193B(1) of the Crimes Act is subject to a maximum penalty of 20 years imprisonment and s 193B(2) is subject to a maximum penalty of 15 years imprisonment. Those subsections provide:

(1)   A person who deals with proceeds of crime—

(a)   knowing that it is proceeds of crime, and

(b)   intending to conceal that it is proceeds of crime,

is guilty of an offence.

Maximum penalty—imprisonment for 20 years.

(2)    A person who deals with proceeds of crime knowing that it is proceeds of crime is guilty of an offence.

Maximum penalty—imprisonment for 15 years.

  1. The applicant contended that, although at [40] the sentencing judge confined his focus to the period up to the approval of the facilities (in considering the issue of risk), in determining the objective seriousness of the individual offences his Honor took into account the period after the approval of the facilities and the amount of the drawdowns. In so doing, his Honour took account of an advantage that was not particularised, being the use of the funds, and a period of offending beyond what was particularised in the Court Attendance Notice. The applicant submitted that in sentencing the applicant on the basis that he dishonestly obtained the loan facilities and then disposed of the funds advanced, his Honour sentenced him for knowingly dealing in property substantially realised from the commission of a serious offence contrary to s 193B(2) of the Crimes Act. In oral submissions, counsel for the applicant described the error as the sentencing judge essentially articulating the criminality as constituting a proceeds offence.

  2. Additionally, the applicant submitted that he was sentenced on the basis that he intended to conceal from the Lenders the true state of affairs during the period of his dealing in the drawdowns, which was to sentence him in relation to criminality that constituted the offence in s 193B(1) of the Crimes Act. The applicant relied in this respect on [56] of his Honour’s reasons:

“However, given the offences at sequences 1, 2, 3 and 4 were complete before sequence 5 and 6 were committed, this does indicate to me, consistently with the Crown submission, that by the time the offences at sequence 5 and 6 were committed, the offender was confident that his dishonest conduct in sequences 1, 2, 3 and 4 could continue and that at that point, he deliberately entered into the contractual arrangements with the Lenders knowing he would breach them with respect to the use of purchaser deposits. His conduct at sequences 5 and 6 is therefore, in my view, more objectively serious.”

(emphasis added).

  1. As Beech-Jones J observed in Turkmani v The Queen [2014] NSWCCA 186; 244 A Crim R 402 at [35], the general principle for which De Simoni stands was articulated by Gibbs CJ (with whom Mason and Murphy JJ agreed) at 389:

“… a judge, in imposing sentence, is entitled to consider all the conduct of the accused, including that which would aggravate the offence, but cannot take into account circumstances of aggravation which would have warranted a conviction for a more serious offence.”

  1. The statement of the general principle is sufficient to demonstrate the difficulty with the applicant’s submissions on this ground. The drawdowns were relevant to his Honour’s assessment of the objective seriousness of the offending, in the applicant’s favour. The advantage the applicant obtained for each of the offences was charged by reference to the ability to draw down the full amount of each of the loan facilities. However, as the sentencing judge noted, the applicant did not draw down any of the facilities to its full amount. As the respondent submitted on this ground of appeal, that the amounts drawn down were relied upon to mitigate the objective seriousness of the offending reflected submissions made by senior counsel for the applicant and concessions made by the Crown in the proceedings on sentence.

  2. The advantage that the applicant obtained was the ability to draw down on the loan facilities in the amounts specified in the charges. It is apparent from the manner in which the sentencing judge summarised the offences that while his Honour took into account the amount the applicant in fact drew down, as part of the overall circumstances of the offending, his Honour did not take the amount of the drawdowns into account as a matter that aggravated the criminality. In initially summarising each sequence, his Honour referred to the full amount of the facility that the applicant had the “ability” to draw down, which was followed (with a connecting “although”, or “but”) by a reference to the actual amount he drew down in respect of each facility. It is also important to recognise that the sentencing judge’s assessment of objective seriousness was not limited to the paragraphs in which his Honour referred to the specific sequences. As I have noted above, in earlier paragraphs his Honour referred to the drawdowns to support his findings that the applicant’s motive was not personal greed but commercial, and, in the context of risk (and again in his favour) that the objective seriousness of the offending was less than what the facility amounts might have otherwise suggested because not all funds available under the loan facilities were in fact drawn down.

  3. The applicant’s submission that [56] of the reasons supported his contention that he was sentenced for the criminality involved in a s 193B(1) offence rested on a misreading of what his Honour was addressing in that paragraph. His Honour was not there referring to the applicant’s state of mind in dealing with the drawdowns. Rather, his Honour was referring to the applicant’s confidence regarding the dishonest conduct by which he obtained the loan facilities, that conduct being the subject of the offences. Each offence involved the same conduct, namely, entering into contractual arrangements with the Lenders which required him to hold the purchaser deposits in trust accounts in circumstances where, pursuant to loan agreements with the individual purchasers, those deposits were withdrawn from the trust accounts and used. That conduct was not sophisticated but, for the purposes of assessing the objective seriousness, the conduct was well-tested by the time of sequences 5 and 6. On that basis, his Honour found that those sequences were more objectively serious. There is nothing in that paragraph that suggests his Honour was sentencing for more serious conduct, as the applicant alleged.

  4. I would dismiss ground 1.

Ground 3: the sentencing judge erred in assessing objective seriousness of each of the offences underpinned by an evaluation of the amount of the drawdowns and the period of time over which they were made and by failing to take into account the responsible management of the drawdowns

  1. As I noted above, this ground proceeded on the basis that the applicant did not establish ground 1. The focus of this ground was what the applicant described as his “responsible management” of the drawdowns, alleging that the sentencing judge failed to take this into account in his assessment of the objective seriousness of the offences. In the hearing, counsel for the applicant described the responsible management by reference to the applicant maintaining, in the loan facilities, an amount of security at least equal to the amount the Lenders required to be left in trust. Counsel submitted that the facilities were always in credit in an amount that exceeded the amount that the Lenders sought as security, meaning that the Lenders’ security was never put at risk. The applicant contended that this evidenced steps taken on the applicant’s part to manage the risk associated with his offending conduct.

  2. The applicant submitted that the risk associated with the conduct was addressed in the course of the proceedings on sentence, but the sentencing judge did not make any finding resolving the issue of risk in the context of objective seriousness. Rather, his Honour first stated at [48] that the issue of whether there was a risk to the Lenders was largely irrelevant when it came to assessing the objective seriousness because the nub of the criminality was at the pre-contractual stage. However, his Honour then stated, at [52], that whether the loss was retrievable was irrelevant as there was no loss, when his Honour should have found that the absence of loss was a mitigating factor. The applicant submitted that his Honour then went on to evaluate objective seriousness “simply by identification of the amount of the drawdown and the period of time over which that drawdown is effected”. The applicant agreed that the sentencing judge went on to accept that there was no loss was a mitigating factor (at [71]), but submitted that his Honour did not return to “whether the absence of harm was happenstance, good luck or whether it was a factor that was relevant to the objective seriousness of what the applicant actually did in perpetuation of the fraud”.

  3. I have set out in some detail above at [22]-[23] the sentencing judge’s discussion of objective seriousness and his assessment of the individual offences. As is clear from the extract at [33], in which his Honour addressed the objective seriousness of each offence, his Honour accepted that it was relevant to that assessment that all of the money that was drawn down from the facilities was repaid. That his Honour expressly referred to this in the context of assessing the objective seriousness of the individual offences was consistent with the point his Honour considered it important to make at the outset of his reasons, namely, that the present case was one in which the advantage that the applicant obtained did not result in a loss to others. His Honour confirmed this in [71], specifically by reference to s 21A(3)(a). His Honour did not need to revisit his findings on objective seriousness because he had already considered the absence of loss in that very context. The weight his Honour gave to the absence of loss is also apparent from [136], where his Honour referred expressly to the absence of loss as ameliorating the objective seriousness of the offences.

  4. What his Honour said, at [52], about loss being irrelevant does not call for a contrary conclusion. As I noted above, the consideration of whether a loss is retrievable is one of the factors identified in the cases to which the sentencing judge referred in [37] as relevant to the objective seriousness of a fraud offence, in the sense that a loss that is not retrievable may be viewed as objectively more serious. His Honour’s observation that the factor was irrelevant because there was no loss was consistent with those authorities, and in the applicant’s favour.

  5. By contrast with the focus of the applicant’s submissions on the appeal which addressed the amount of the loan facilities that the applicant did not draw down, the applicant’s submissions to the sentencing judge focused on aspects of the loan transactions, such as the conservative loan to value ratio, as supporting that there was very little risk to the Lenders even taking into consideration the deception by the applicant with respect to the deposits. Ultimately, at [48] of the reasons, his Honour focused on the gravamen of the offending as the obtaining of the advantage, and not the risk to which the Lenders were exposed. However, it does not follow that his Honour did not consider the impact of the offending on the Lenders, noting his finding that ultimately the funds that were drawn down were repaid. In so far as the applicant submitted on the appeal that the sentencing judge did not regard as relevant “any evidence of steps taken to mitigate the risk by the perpetuation of the fraud, either at the point of the deception or thereafter”, there was no specific evidence about the steps the applicant took to manage the drawdowns; and in any event the submission does not properly reflect the totality of his Honour’s reasons.

  6. The applicant’s specific submission about the amounts left in the loan facilities rested on a misconceived understanding of the effect of applicant’s deception on the transactions in question (noting that the agreed facts contained little in the way of detail as to the precise contractual terms). The applicant’s so-called “management” of the risk comprised leaving an amount of the facilities not drawn down so that there was an amount, representing the amount of security, that the Lenders could call on in the event of default. All that meant, however, was that the Lenders would have available funds, from their own facilities, to meet a security that they had been told was separately and independently available. The proposition that this constituted management of the Lenders’ risk need only be stated to be rejected. I would dismiss ground 3.

Ground 2: the sentence was manifestly excessive

  1. The applicant’s written submissions on this ground effectively relied on the success of ground 1. As I have rejected ground 1, ground 2 also fails in so far as it relied on that ground.

  2. In the course of the appeal, the applicant also relied on what was said to be the latent error in [71] of the reasons, in that his Honour accepted that the absence of harm was a mitigating factor but did not then return to the issue of objective seriousness. For the reasons I have outlined above in the context of ground 3, the applicant’s submissions about his Honour’s findings regarding objective seriousness entail a disjunctive reading of his Honour’s reasons in a manner that does not fairly reflect the careful exercise that his Honour undertook. The sentence was not manifestly excessive in the manner for which the applicant contended. I would dismiss ground 2.

Conclusion

  1. I propose the following orders:

  1. Leave to appeal against sentence is granted.

  2. The appeal is dismissed.

  1. ROTHMAN J: I agree with Mitchelmore JA.

  2. YEHIA J: I have had the advantage of reading the draft judgment of Mitchelmore JA. I agree with the proposed orders and with her Honour’s reasons.

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Decision last updated: 23 June 2025

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R v Sulaiman [2025] NSWDC 415
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R v Sulaiman [2025] NSWDC 415
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R v De Simoni [1981] HCA 31
R v De Simoni [1981] HCA 31
R v De Simoni [1981] HCA 31