R v Donaldson & Poumako (No 2) - [2009] SASC 83

SUPREME COURT OF SOUTH AUSTRALIA
(Court of Criminal Appeal)
R v DONALDSON & POUMAKO (No 2)
[2009] SASC 83
Judgment of The Court of Criminal Appeal
(The Honourable Justice Duggan, The Honourable Justice Bleby and The Honourable Justice David)
2 April 2009
CRIMINAL LAW - APPEAL AND NEW TRIAL AND INQUIRY AFTER CONVICTION - APPEAL AND NEW TRIAL - APPEAL AGAINST SENTENCE - APPEAL BY CONVICTED PERSONS
Appellants convicted of 22 counts of offering securities without lodging a disclosure document contrary to s 727(1) of the Corporations Act 2001 (Cth) and 22 counts of issuing securities without disclosure contrary to s 727(4) of the Corporations Act 2001 (Cth) – appellants appealed against conviction on all counts and the appellant Poumako appealed against sentence – prosecution appealed against sentence on the appellant Donaldson – appeal against conviction by appellant Poumako dismissed – appeal against conviction by the appellant Donaldson allowed on 26 counts – convictions on those counts quashed and verdicts of not guilty entered (R v Donaldson & Poumako [2009] SASC 31) – present proceedings concerned with appeal against sentence by appellant Poumako and re-sentencing of appellant Donaldson.
Sentencing judge sentenced Ms Donaldson to a single sentence of imprisonment for 18 months on all counts, but ordered that she be released forthwith upon entering into a bond in the sum of $1500 to be of good behaviour for a period of 18 months - sentencing judge sentenced Mr Poumako to imprisonment for two years and six months on all counts to be released after serving a period of 12 months and upon entering into a recognisance to be of good behaviour for a period of 18 months after his release.
Held: Circumstances do not justify a retrial of Ms Donaldson - Convictions on counts 1 to 13 inclusive and counts 23 and 35 inclusive recorded against Ms Donaldson will be set aside and verdicts of not guilty entered in relation to those counts - single sentence of imprisonment for 18 months imposed on counts 14 to 22 and counts 36 to 44 Ms Donaldson to be released forthwith upon entering into a recognisance in the sum of $1,500 to be of good behaviour for a period of 12 months - Appeal against sentence by Mr Poumako dismissed.
Corporations Act 2001 (Cth), referred to.

R v DONALDSON & POUMAKO (No 2)
[2009] SASC 83
Court of Criminal Appeal: Duggan, Bleby and David JJ

DUGGAN J: The Court indicated in earlier reasons that it would dismiss the appellant Poumako’s appeal against conviction. It was also stated that the appeal against conviction by the appellant Donaldson would be allowed on counts 1 to 13 inclusive and counts 23 to 35 inclusive, but her appeal against conviction on the remaining counts would be dismissed.
At the time of handing down its reasons the Court invited further submissions on the appeal against sentence by Mr Poumako and the sentence which should be imposed on Ms Donaldson in the event that the Court decided not to order a re‑trial.
Submissions on these issues have now been made.
Counsel for the Director of Public Prosecutions for the Commonwealth advised that the prosecution did not seek a re‑trial of Ms Donaldson on counts 1 to 13 and counts 23 to 35 inclusive. The Court agrees that it is not appropriate to direct a re-trial on these counts. There is a paucity of evidence as to Ms Donaldson’s state of mind relevant to the issue of recklessness in relation to these counts. The circumstances do not justify the expense involved in a re‑trial, particularly when Ms Donaldson is to be punished for the remaining offences. Accordingly, the convictions on counts 1 to 13 inclusive and counts 23 to 35 inclusive which were recorded against Ms Donaldson will be set aside and verdicts of not guilty entered in relation to those counts.
In the circumstances it will be necessary to sentence Ms Donaldson afresh on the remaining counts.
The sentencing judge sentenced Ms Donaldson to a single sentence of imprisonment for 18 months on all counts, but ordered that she be released forthwith upon entering into a bond in the sum of $1,500 to be of good behaviour for a period of 18 months. Mr Poumako was sentenced to imprisonment for two years and six months on all counts and the sentencing judge ordered that he be released after serving a period of 12 months and upon entering into a recognisance to be of good behaviour for a period of 18 months after his release.
Counsel for Ms Donaldson argued before this Court that Ms Donaldson should be sentenced to a shorter term of imprisonment in light of the fact that she is now to be sentenced for a reduced number of offences. He submitted that the sentence should be suspended. Counsel for the Director of Public Prosecutions submitted that the sentence of imprisonment for 18 months imposed by the trial judge should be re-imposed by this Court for the lesser period of offending and that the Court should decline to suspend that term. The application by the prosecution for permission to appeal against Ms Donaldson’s sentence is no longer relevant because of the setting aside of the convictions on some of the counts. However, it had been the submission of the prosecution at the earlier hearing that the sentence imposed on Ms Donaldson was manifestly inadequate.
Counsel for the Director of Public Prosecutions pointed out that, at the time Ms Donaldson committed the offences for which she must now be sentenced, she was well aware of the disclosure requirements. He said that these particular offences were committed intentionally and in the knowledge that an undertaking had been given by the solicitor who was acting for her and Mr Poumako that the company would not offer further securities until it had complied with all of its obligations under the Corporations Act 2001 (Cth).
Ms Donaldson was 46 years of age when sentenced. She separated from her husband in 1991 and has four children living under her care. They were aged 20, 19, 17 and 13 at the time of sentencing. She has been employed in various capacities since leaving school. Ms Donaldson assists in the care of her sister who is confined to a wheelchair and is permanently disabled. She conveyed, through her counsel, that she was extremely remorseful for her involvement in the present matter. She has no previous convictions.
The sentencing judge sentenced Ms Donaldson on the basis that Mr Poumako was the manager of the enterprise and that her role focussed upon dealings with individual investors.
When comparing the respective roles and backgrounds of the appellants in his sentencing remarks, the judge said:
Whilst there was no submission from you, Mr Poumako, as to this, Ms Donaldson through her counsel submitted that she should be sentenced in a different manner, and for these reasons: first, because she was in effect the subservient, inexperienced party in the enterprise and relied largely on the knowledge and leadership of you, Mr Poumako, and, secondly, because of the assistance she has provided. As to the first of those contentions, I have already found there is merit in it. You, Mr Poumako, were the effective instigator and manager of the entire enterprise. As to the second matter, I will have some, but a limited, regard for the assistance, given its limited worth. I should say, however, that I was rather more impressed by Ms Donaldson’s expressed level of remorse for her part in the offending than I was with Mr Poumako’s single expression of regret.
There is a further reason for extending some leniency to Ms Donaldson and it relates to the significant dependence of other persons upon her. Accordingly, I propose to fix separate and different sentences.
The information comprises 44 counts. The offence of offering a security without lodgement of a disclosure document is charged in 22 counts and a further 22 counts allege issuing a security without disclosure to investors. Each fundraising transaction gave rise to two charges so there were 22 transactions in all.
Ms Donaldson must now be sentenced on 18 counts which arose out of nine transactions between 16 September 2003 and 29 December 2003. The funds raised in these transactions total $540,000. Originally, she was sentenced on 44 counts which involved fundraising totalling $1.108m. I accept the prosecution submission that an aggravating feature of the offences for which Ms Donaldson must now be sentenced is that they took place after she was fully aware of the disclosure requirements and after she and Mr Poumako had agreed to provide an undertaking that they would comply with the requirements for raising funds in this way. Nevertheless, it is obviously relevant that the extent of her offending which requires punishment has been substantially reduced.
In my view, the total sentence imposed by the sentencing judge for the original 44 counts was particularly lenient. I am of the view that the offending for which she must now be sentenced merits the head sentence of imprisonment for 18 months which was imposed by the sentencing judge, albeit for a greater number of offences. I agree with the prosecution submission that general and personal deterrence are of particular relevance to offending of this nature.
The question remains whether an immediate custodial sentence is appropriate.
The matters relied upon by the sentencing judge in deciding that an immediate custodial sentence was not required are relevant factors to be taken into account by this Court in deciding whether to adopt the same course.
There is material to support the submission that Ms Donaldson was inexperienced in business and that she placed significant reliance on the leadership of Mr Poumako. Counsel for Mr Poumako did not contest the claim made during submissions before the sentencing judge that Mr Poumako assured Ms Donaldson that he had assets which would be used to reimburse the investors if the venture did not succeed.
Furthermore, it is of some relevance that Ms Donaldson is required to care for her children and permanently disabled sister. She has no previous convictions.
Apart from the matters which were relied upon by the sentencing judge, subsequent events are also of relevance to whether an immediate custodial sentence should be imposed on her. I have referred to the significantly reduced offending for which Ms Donaldson must now be sentenced. The offences occurred in 2003. The information was filed on 26 June 2006. The jury returned their verdicts on 30 April 2008 and the sentencing took place on 1 October 2008. Since that date Ms Donaldson has been subject to the bond to be of good behaviour which she entered into at the time of sentencing. She has obtained new employment in the meantime.
In my view it would be inappropriate in the light of these matters and the considerations referred to by the sentencing judge to require that Ms Donaldson serve an immediate term of imprisonment at this stage.
I would impose a single sentence of imprisonment for 18 months on counts 14 to 22 and counts 36 to 44. I would make allowance for the period which has elapsed while Ms Donaldson has been subject to the recognisance to be of good behaviour by directing that she be released forthwith upon entering into a recognisance in the sum of $1,500 to be of good behaviour for a period of 12 months from the date of her sentencing by this Court.
There remains for consideration the appeal against sentence by Mr Poumako. It was not argued that the head sentence imposed upon Mr Poumako was manifestly excessive. The only argument raised on the original hearing of this appeal was that the sentencing judge should have released Mr Poumako forthwith upon entering into a recognisance to be of good behaviour. Particular emphasis was placed on the principle of parity.
In view of the setting aside of Ms Donaldson’s convictions on the earlier offences and the requirement to re-sentence her, it is no longer necessary to consider whether the sentences imposed by the sentencing judge offended against the principle of parity. However, it is appropriate for this Court to consider the issue of parity in the light of the re-sentencing of Ms Donaldson.
In the event that Ms Donaldson is sentenced in accordance with the views which I have expressed above, it is my view that no adjustment is required to Mr Poumako’s sentence by reason of a justifiable sense of grievance on his part.
It is of particular relevance that the offending for which Ms Donaldson must be sentenced is now significantly less extensive than the offending for which Mr Poumako was sentenced. Furthermore, as has already been pointed out, Ms Donaldson appears to have acted in a lesser role in the commission of the offences.
I would reject the submission that Mr Poumako’s ill‑health required a lesser sentence. The sentencing judge extended considerable leniency to Mr Poumako by ordering that he be released after serving 12 months of his sentence. In my view the seriousness of Mr Poumako’s offending and the lack of mitigating circumstances justify the sentence imposed by the sentencing judge.
I would dismiss Mr Poumako’s appeal against sentence.
BLEBY J: I agree with the orders proposed by Duggan J and with his reasons. I merely add a few remarks of my own in relation to the sentence now to be imposed on Ms Donaldson.
Both sentences imposed by the trial Judge, and particularly that imposed on Ms Donaldson for the original convictions, were extremely lenient. I have no hesitation in agreeing that the sentence now proposed by Duggan J for Ms Donaldson, being that originally imposed by the trial Judge, is appropriate, notwithstanding the reduced number of convictions. My hesitation has been whether she should also be required to serve some part of that sentence.
Notwithstanding Ms Donaldson’s secondary role in the business, the offending for which she is now convicted was committed by her in the full knowledge and awareness of the disclosure requirements, after being advised that their existing practice was in breach of the fund-raising provisions of the Corporations Act, and after both she and Mr Poumako, through their solicitor, had agreed to act in accordance with the requirements of the Corporations Act in any further fund raising. Notwithstanding that knowledge and agreement, she continued to be a party to raising money in breach of the Corporations Act requirements. The offending of which she is now convicted was a deliberate flouting of the law involving losses to investors of over $500,000.
I take into account Ms Donaldson’s secondary role in the business, her remorse, her limited assistance to the authorities, her lack of previous convictions and the needs of her dependent sister and parents. To a significant extent these are reflected in the difference in the sentences imposed on her and Mr Poumako. Without more, I do not consider that these factors would justify the suspension of the whole sentence, given the seriousness of the offending.
Not without hesitation, what I think tips the scales in favour of suspension of the sentence in the circumstances of this case are Ms Donaldson’s lack of any previous criminal history, her obtaining of part-time employment following dismissal from her then employment upon her original conviction, her ongoing psychological treatment, the time it has taken to final resolution of the proceedings with the inevitable stresses involved, and the fact that she has already been subject to a recognisance to be of good behaviour entered into at the time of her original sentencing. I therefore concur in the sentence now proposed by Duggan J.
DAVID J: I agree with the sentence to be imposed upon Ms Donaldson proposed by Duggan J for the reasons that he has given. I also agree that the appeal against sentence in relation to Mr Poumako should be dismissed for the reasons given by Duggan J.