R v Dreghorn

[1996] QCA 379

IN THE COURT OF APPEAL	[1996] QCA 379
SUPREME COURT OF QUEENSLAND

C.A. No. 223 of 1996

Brisbane

[R v. Dreghorn]

THE QUEEN

v.

RONA ANN DREGHORN

(Applicant)

Moynihan SJA
Mackenzie J.

Cullinane J.

Judgment delivered 11 October 1996

Reasons for Judgment - The Court

Application for leave to appeal granted.
Appeal allowed.
The sentence imposed below is set aside; the matter is remitted to the District Court at Mackay

for the purpose of the sentence being heard and determined according to law.

CATCHWORDS:	CRIMINAL LAW - SENTENCE - Defrauding the Commonwealth - whether the sentence was determined upon an accurate factual basis as to the extent of the applicant's involvement - whether the sentence imposed was manifestly excessive.
Counsel:	Applicant appeared on own behalf. Mr D. Boyle for the respondent
Solicitors:	Applicant appeared on own behalf. Commonwealth Director of Public Prosecutions for the respondent
Hearing Date:	1 October 1996
REASONS FOR JUDGMENT - THE COURT

Judgment delivered 11 October 1996

The applicant owned and her sister Tharessa Newton operated on a day to day basis a child care centre at Mackay. There was an entitlement to payments from the Commonwealth in respect of certain classes of children. During the period covered by the indictment (1 April 1991 to 30 April 1995) about $800,000 was paid to the centre by the Commonwealth but of that sum about $153,000 was fraudulently obtained by representations that children who did not attend had attended and that some who did attend were in attendance for longer periods than they had actually been.

Both the applicant and Newton pleaded guilty, in the case of the applicant to defrauding the Commonwealth, and in the case of Newton, to being knowingly concerned in the applicant's fraud. Each was sentenced to four years' imprisonment, with provision for release on recognizance after 18 months and 12 months respectively.

The Crown's submissions on sentence in respect of the applicant were based on a record of interview given by Newton as the applicant was not interviewed by the police. The Crown Prosecutor adopted Newton's allegation that the applicant had been the instigator of the process of falsifying the records and had calculated figures to be included in them and that Newton had participated in the process by actually creating false documents which included forged signatures of parents. On the Crown's version the applicant was involved throughout the whole period of the fraud. The Crown Prosecutor summarised his submissions in the following passage:

"As to the culpability of the prisoners, the Crown says there is nothing to choose between them. Tharessa Newton, when interviewed, said that Rona Dreghorn had told her to do certain things and she did them for the purpose of keeping her job, she wanted employment. The Crown says she took an active part, was the front- runner, as it were, for all of the daily contact with most of the parents, was responsible for documentation and was responsible in a major way for the fraud. Hard to draw a line between them, the Crown says, in relation to culpability. They each played their part. Rona Dreghorn owned the centre and made the claims and provided the amounts. Tharessa Newton filled out the forms, and there were thousands of them, and prepared the forged signatures."

Newton's counsel's submissions were to the effect that she knew of the scheme but her involvement was at a lower level than that of the applicant who was the person who knew how the subsidy scheme worked and had control of the financial aspects of the business. Counsel for the applicant on the other hand presented a version in which the applicant played little part in the operation of the centre after the initial period and did not instigate the fraud. The critical passage of his submissions is the following:

"She instructs me that when these commenced - initially started, she wasn't aware of what was going on. My instructions are that Tharessa would in fact bring the necessary documentation round to her home. At this stage they had been living together and then Tharessa moved out and she'd bring them round to her home and she being the applicant, would sign them and they would be sent off. Your Honour, I'd submit that would be corroborated somewhat by the fact that all the documentation that my learned friend has put up, has been completed by Tharessa. ...

But, this is not a defence, Your Honour, because this activity commenced and whilst it's our submission that initially we weren't aware of what was going on, we would say that we soon became aware because when we visited the centre and after looking at the documentation she was asked to sign, she just put two and two together and knew that there wasn't that many children there at that time. She feels she was in a catch 22 situation in so far as that she knew what was going on, she knew it was wrong, but she knew if she'd just closed down the place straight away to stop it, then she would be audited and she'd be caught and so she didn't know any other way what else to do, so she just went along with it. And, in fact as it got to the extent that documentation and completion documents occurred at her home.

So, what I'm saying is that initially she didn't know it was happening, but eventually she did become aware of what happened, she allowed it to continue and went along with the scheme."

The submission is not specific and, indeed, is ambiguous as to when the applicant actually became aware of the fraud. The significance of that is that the applicant has sworn an affidavit to the effect that she had informed her counsel that she had become aware of the fraud only after she had returned from a trip to Tonga in late September 1994. She deposed that she had "a very brief discussion with my counsel before going to court and I do not feel that he fully understood what had really taken place". If the version in her affidavit is to be acted on as reflecting the instructions she gave, the submission that she "soon became aware" of the fraud is hard to reconcile with it.

An affidavit was filed by a senior legal officer in the office of the Commonwealth Director of Public Prosecutions deposing to an attempt to obtain information from counsel who represented the applicant in the District Court and his instructing solicitor on the question of compliance with instructions. However no assistance had been forthcoming. Mr Boyle who appeared for the Commonwealth Director of Public Prosecutions, was not disposed to submit that there was an obligation on the legal representatives to provide such information. He assumed the position that the Court should act on the assumption that on this occasion such information would not be forthcoming. No application was made to cross-examine the applicant on her affidavit. Mr Boyle accepted that if the applicant's affidavit was uncontradicted her instructions that she had only become aware of the fraud at a late stage of the period alleged in the indictment had not been properly put before the sentencing judge. Further as the applicant was sentenced on the basis that the applicant "had full knowledge of the extent of the fraud that was being perpetrated" and that the case was one which involved "a sophisticated fraud in which you both voluntarily participated for a period of almost four years", such findings were inconsistent with the applicant's instructions which had not been adequately put. He also accepted that if that version had been put it would have been difficult, in the absence of evidence to the contrary, to reject it as inherently improbable. The fact that the applicant's allegation that she had become aware of the fraud much later than the Crown alleged was not exposed at the sentence hearing meant that the possibility that evidence might need to be called by the Crown to refute that version did not arise for consideration.

Mr Boyle submitted that the appropriate course was to set aside the sentence on the basis that the applicant's instructions had not been complied with and remit the matter to the District Court so that the sentencing might be determined on such evidence as seemed appropriate. It was foreshadowed that the Director of Public Prosecutions would expect to call Newton to give evidence to rebut the applicant's version. Regrettably, as the matter stands, that seems to be the only course open. If the sentence below is set aside on the basis that the applicant was denied natural justice because a critical element of her instructions were not properly put, the appropriate course is to remit the matter to the District Court to be determined according to law. It should not be taken that this course is other than exceptional. It results from the unusual course that the matter has taken. Ordinarily it would be appropriate for the question whether an accused person's instructions had been complied with to be the subject of full and complete material at the hearing of the application for leave to appeal.

The applicant, who was unrepresented, was aware of the likelihood that Newton would give evidence in the further proceedings but nonetheless wished to maintain that she did not know until a relatively short time before the investigation commenced that the fraud had been committed. At the conclusion of the proceedings the court announced that the matter would be remitted to the District Court at Mackay for the purpose of re-sentencing. The formal order is that the application for leave to appeal is granted; the appeal is allowed and the sentence set aside; the matter is remitted to the District Court at Mackay for the purpose of the sentence being heard and determined according to law.