R v Drew

[1997] QCA 141

IN THE COURT OF APPEAL	[1997] QCA 141
SUPREME COURT OF QUEENSLAND

C.A. No. 103 of 1997

Brisbane

Before Fitzgerald P.
McPherson J.A.
Lee J.

[R. v. Drew]

THE QUEEN

v.

PETER MERVYN DREW

(Applicant) Appellant

Fitzgerald P.
McPherson J.A.

Lee J.

Judgment delivered 30 May 1997
Separate concurring reasons of Fitzgerald P. and McPherson J.A., Lee J. concurring with
McPherson J.A.

APPEAL AGAINST CONVICTION DISMISSED. APPLICATION TO EXTEND TIME IN WHICH TO APPLY FOR LEAVE TO APPEAL AGAINST SENTENCE REFUSED.

CATCHWORDS: CRIMINAL LAW - Conviction - Obtaining of money by false pretences - Indictment bad for duplicity - Form 255 Schedule to Criminal Practice Rules 1900 - R. v. Johnstone (1950) 1 All E.R. 830 explained.

Counsel:	Mr Puryer (solicitor) for the appellant Mr M. Byrne Q.C. for the respondent
Solicitors:	Puryer & Co. for the appellant Director of Public Prosecutions (Qld.) for the respondent
Hearing Date:	14 May 1997

REASONS FOR JUDGMENT - FITZGERALD P.

Judgment delivered 30 May 1997

The circumstances giving rise to this appeal are set out in the reasons for judgment of McPherson J.A. I agree that the appeals against conviction should be dismissed and the application for an extension of time to apply for leave to appeal against sentence refused and, subject to what follows, with his Honour’s reasons.

I am not sure that the complaint “that Carlson had notice of the true position, and that flowed through with respect to the rest of the dealings with AGC” was intended to suggest that the fraud might have been uncovered by greater diligence. As I understood the appellant’s case, there was a suggestion that Carlson was aware of the true position in relation to the vehicles. However, whether or not my understanding in that respect is correct, the grounds taken in the notice of appeal were plainly without substance. From appeals which come to this Court, there seem to be many criminal prosecutions which are defended solely in the hope that the prosecution will fail to prove its case beyond reasonable doubt or that the trial judge will make an appealable error. While that is an accused’s prerogative, it is not the duty of a trial judge to attempt to lend credibility to improbable defence stories or theories in the directions given to the jury or the duty of this Court to find that every imperfection in a trial involved a substantial miscarriage of justice.

Although the trial judge, in sentencing the appellant, referred to the offences as a “carefully planned and sophisticated fraud”, the facts were without complexity. A “loan” was obtained by the appellant’s company, Riverford Pty Ltd, on the basis that it owned three vehicles which had recently been purchased at a price or prices which would cover the amount lent. False receipts relating to the vehicles were used in the misrepresentation. It is only a slight over-simplification to say that the jury’s task was essentially to resolve a conflict of evidence between the prosecution witnesses and the appellant and his supporting witness, Ms Lang, in a context in which the appellant’s contention was that he knew nothing of the false receipts produced by Mr Volling which found their way into the possession of Mr Jansen. Taken in that context, the trial judge’s summing-up does not give rise to any concern that the appellant might not have had a fair trial.

Whether or not the counts in the indictment on which the appellant was convicted were technically deficient, it would be farcical to suggest that the prosecution was not entitled to adduce evidence from both officers of the bank and its associated company with whom the appellant had dealings in the course of the material transaction. It would be equally absurd to suggest that the prosecution was required to elect between the communications which the appellant had with each of those officers and to rely upon one or the other as constituting the false pretences by which the money was obtained. It would have been open to the prosecution to allege that the money was obtained by false pretences made to both employees of the bank and associated company, and the jury would not have been required to engage in the sophistry of determining whether that was so or whether the actual inducement had been the misrepresentations made to one of them but not the other.

The absence of merit in the appellant’s complaint about the form of the indictment is demonstrated by the conduct of the trial.

The counts were particularised at the beginning of the trial. The prosecutor said:

“... the way the Crown case is this: Carlson worked for Westpac at the time, Jansen worked for AGC. Carlson directed the accused to Jansen to do the paperwork on the loan, so to speak. The moneys were actually loaned by AGC. The Crown case is that it is a continuing pretence that started with Carlson and continues with Jansen and that in essence the same pretence is being made in both instances, that is, that car is recently purchased by Riverford Pty Ltd ... . ... it is a continuing false pretence ...”

Later, the prosecutor said:

“The Crown case is that this is one commercial transaction; that is, the accused first raised obtaining the loan with Carlson, the loan was then - the completion of the loan was continued by Jansen and the representation is a continuing one which ... started with Carlson and then continued with Jansen.

... the Crown case is not that more than one sum of money is obtained from the single false pretence, it’s just the one sum of money, it’s just that the pretences are continuing representations which were made to two people.”

In his summing-up, the trial judge told the jury “that on each of the three counts an essential part
of the Crown case is the receipt signed by Volling which is said to be a false receipt and the
invoice from Riverford addressed to Westpac and recording the sale of the relevant motor
vehicle ...”.
Later, his Honour said:

“if you accept the Crown case various things were said to Mr Carlson and Mr Jansen but a very important part of the Crown case is that these documents were delivered to Westpac or AGC and found their way onto the desk of Mr Jansen. ...

... when the documents are delivered to Mr Jansen, there is a false pretence by conduct if you accept the Crown’s case and it is a false pretence by conduct because you will see it is based on a false document in each case, and that is the receipt.

...

So the Crown case is that there was, at the very least, a false pretence by conduct when these documents were delivered to Mr Jansen. So that is what involved, in part, in the making of a false pretence. He also had discussions, and you will realise there were discussions with Mr Carlson and discussions with Mr Jansen, but it would seem, on the evidence, that the documents ended up with Mr Jansen, not with Mr Carlson, and that is why I suggest, at the end of the day, if you are satisfied that there was a false pretence, then you are likely to find that a false pretence was made to Mr Jansen.

This does not mean, of course, that you ignore any discussions that take place between Mr Jansen and [the appellant] because a false pretence may be by words and by conduct and the Crown says that there were both words and conduct in this particular case.”

There was no room for any misunderstanding, and the appellant was not disadvantaged in any way. It is plain that there has been no miscarriage of justice, and that there is no substance in the appeal.

REASONS FOR JUDGMENT - McPHERSON J.A.

Judgment delivered 30 May 1997

The appellant was found guilty at his trial in the District Court of three counts of obtaining by false pretences amounts totalling $41,500 from Australian Guarantee Corporation Ltd. He was sentenced to imprisonment for 2½ years. He now appeals against his conviction and also seeks an extension of time to apply for leave to appeal against sentence.

In 1995 the appellant was the principal of Riverford Pty. Ltd. which carried on a car hire business under the name Pennywise Rent-a-Car. He or that company arranged to buy another company Redcliffe Wrecking Company Pty. Ltd. or its business for a large sum of money. To enable the contract to be settled, the appellant applied for a loan at the Chermside branch of Westpac Bank, where he was interviewed by the business banking manager Mr Carlson. He told the appellant that, in a commercial matter like this, the practice of the Bank was that the loan would be made by its wholly owned subsidiary AGC on the security of vehicles owned by Riverford; but that AGC would need to be satisfied that the vehicles were owned and had recently been purchased by Riverford at a price or prices that would cover the amount being lent. For the purpose of this “hire and buy-back” arrangement as it was called, AGC would need to see invoices showing that the vehicles had been so acquired by Riverford.

It was Mr Carlson who in fact approved the loan subject to compliance with those conditions. The file concerning the application for loan then passed to Mr Jansen, who was the finance manager at Kedron for AGC, by which the money was to be lent. The procedure adopted by AGC to obtain security over the vehicles was to require that they be sold to it by Riverford, after which the vehicles would be hired back to that company under hire purchase agreements in terms of which Riverford would make payments which in time would discharge the amount being lent. Those arrangements would enable Riverford to retain the vehicles and continue using them in its hire car business. The amount being borrowed was $41,500 and, to satisfy AGC’s requirements, the appellant nominated three vehicles that were to be the subject of the loan and security arrangements. The vehicles in question were a Commodore station wagon registration number 269-CGI, which became the subject of count 3 in the indictment; a Ford Falcon car registration number 365-CPW, which was the subject of count 6; and another Ford Falcon no. 839-CPW (count 9).

Mr Jansen asked the appellant to produce documentation showing ownership and recent acquisition of the three vehicles, and in due course he received with other material three receipts dated 5 May 1995 numbered 202904, 202905, and 202906 in respect of the three vehicles, which together with the executed hire purchase agreements were admitted at the trial as exs. 3, 4, and 5. Because of the lapse of time, Mr Jansen was unable to recall precisely how these documents had reached the office of AGC, but he did recall seeing them and acting upon them in authorising payment of the loan totalling $41,500, which was credited to the account of Riverford with the Fortitude Valley branch of the Bank on 12 May 1995.

It was these receipts that were alleged by the Crown to constitute or contain the representations or pretences made by the appellant that induced a loan to be made. The representations were alleged to be false in various particulars. In the case of the Commodore station wagon (count 3), the falsity was said to lie in the fact that the vehicle in question had never been owned or purchased, either recently or at all, by Riverford for the sum of $24,750 shown in receipt 202904. At the trial, it was common ground that it belonged to a Mr and Mrs Burgess, who at the time were both employees of Riverford, and it remained their property throughout. Evidence to that effect was given by both Mr Burgess and Mrs Burgess, who has since separated from her husband and reverted to her maiden name Miss Lang. Evidently, the Commodore was at times used in the car hire business by being hired out to customers, but it was never sold or transferred to Riverford, although the Burgesses planned to put it in as their contribution to acquire a share in the wrecking yard being purchased by Riverford. Miss Lang testified that this had been explained to Mr Carlson; but he denied that she told him, and the jury evidently accepted his account of the relevant conversation or occasion on which she was present with the appellant at Carlson’s office.

As regards the two Ford Falcon vehicles, the falsity was alleged to arise from the fact that the two receipts 202905 and 202906 purported to show that the vehicles had also been purchased and paid for by Riverford on 5 May 1995 at prices respectively of $8,450 and $8,300, whereas in fact searches (ex. 8) of records kept by the Queensland Department of Transport showed that each of them had been continuously registered in the name of Riverford since August 1994.

Without direct evidence that the appellant had delivered the false receipts (as it is convenient now to call them) to Jansen, the Crown was forced to rely on inference to that effect, which the jury were invited to draw. Whether or not they would have been prepared to draw that inference from the material so far recited might possibly have been an open question. There was evidence from the appellant, who testified at the trial, to the effect that others had on behalf of Riverford prepared and perhaps delivered the documentation, or some of it, leading to the loan. What, however, brought home responsibility to the appellant for the offending receipts and also established his fraudulent participation in what happened was the evidence of a Mr Volling on behalf of the prosecution at the trial.

Ross Alexander Volling is a milk vendor, who at times carries on, or had carried on, business as a dealer in used cars under the name Alexander Ross Used Cars and Commercials. In May 1995, at a time when that business was in abeyance, he wrote out the receipts nos. 202904, 202905, and 202906 now forming part of exs. 3, 4 and 5, on which Jansen claimed to have later acted in making the loan to Riverford. Each of those documents purports to show the receipt for a cheque from Riverford Pty. Ltd. of an amount described as being “payment in full” for a used vehicle details of which appear on the receipt. The details, which in each case include the vehicle engine and registration numbers, correspond to the numbers and to the prices averred in counts 3, 6 and 9. As already mentioned, each of the receipts is dated 5 May 1995, and Volling’s evidence was that on or about 5 May 1995 he had at the appellant’s request made out the receipts in that form. He testified that he had in fact never owned any of those vehicles and had never sold any of them to Riverford.

In so far as the receipts purported to record the transactions appearing on their face, they were complete fabrications. Volling was, it seems, later prosecuted and pleaded guilty to forging them. According to his account of it, when the receipts were written out, the appellant was seated at the other side of the table at the Pennywise Car Hire premises, and he then took them away with him for use next day. The appellant denied being present on that occasion, and he professed to be acquainted with Volling only very slightly. The receipts were later examined and found to bear fingerprints; but they were too smudged to be identified. The learned trial judge treated Volling as an accomplice and warned the jury of the dangers of relying on his testimony; but, taken with all the other evidence, circumstantial and otherwise, they were plainly entitled to find, as they did, that the appellant was guilty of the false pretence charges in counts 3, 6 and 9.

There is no perceptible basis for regarding the verdicts as unsafe or unsatisfactory, and on appeal it was not suggested that they were. The only grounds taken in the notice of appeal are (1) that the evidence given by witnesses at the trial was inconsistent with that given at the committal proceedings; and (2) that the judge’s summing up was biased in favour of the prosecution. As to (1), the evidence at committal was not tendered at the trial, and is not before this Court as part of the appeal record; if there was anything in the point, it may confidently be assumed that the inconsistencies would have been relied on by counsel representing the appellant at the trial in the course of his cross-examination of prosecution witnesses.

As to (2), it is enough to say that in summing up to the jury the trial judge read extensive passages from the evidence of both prosecution and defence witnesses and summarised the submissions of either side. Defence counsel at the trial nevertheless complained that the defence case had not been sufficiently put. That case, “putting it in a nutshell”, was he said a denial of any specific conversation with Jansen “but more importantly ... that Carlson had notice of the true position, and that flowed through with respect to the rest of the dealings with AGC”. This appears to have been intended to suggest that if Carson and Jensen had examined some documents more closely or instituted further inquiries and searches of their own, they might, by the use of greater diligence, have uncovered the fraud that was being practised on their employer. It has, however, never been the law that the offence of obtaining by false pretences is not committed simply because the person deceived had, but did not make use of, means of avoiding the deception in fact practised upon him. See R. v. Jessop (1858) Dears. & Bell 442; 169 E.R. 1074.

Whether or not a particular summing up is so “unbalanced” as to justify an appellate court in later setting aside the verdict is, in the end, very largely a matter of subjective impression formed by reading the summing up as a whole. The summing up in the present case was thorough and referred extensively and fairly to selections from the evidence and submissions on either side. Given that a number of elements had to be proved by the prosecution and so needed specific attention, it cannot be faulted as being slanted in favour of either the prosecution or the defence.

This leaves for consideration only one further matter which, although not put forward as a ground in the notice of appeal, was relied on at an early stage in the trial, and was the subject of submissions on appeal. It was that each of counts 3, 6, and 9 charging false pretences was bad for duplicity on the ground that what it alleged was that the relevant representation or pretence was made “to Peter Carlson or John Martin Jensen”. It was submitted that the effect in each instance was to charge the appellant with two separate offences, which it was said was impermissible.

To dispose of this complaint, it is helpful to use as the example the charge in count 3 of the indictment. It alleged an offence of obtaining with intent to defraud the sum of $24,750 by falsely pretending to Peter Carlson or John Martin Jensen that Riverford had recently purchased a Commodore motor vehicle registration number 269-CGI. In R. v. Sowerby [1894] 2 Q.B. 173, the Court of Crown Cases Reserved held that an indictment that charged an offence of obtaining by false pretences without averring the person to whom the pretence was made was defective. In giving judgment, Lord Coleridge said ([1894] 2 Q.B. 173, 175):

“We must follow the old authorities and precedents in criminal matters, and no case can be found which says that an indictment for obtaining money by false pretences, which does not state the person to whom the false pretence was made, is a good indictment. A pretence means a holding out to some other person, and that person must be stated in the indictment. The old precedents also contain the averment ‘by means of which false pretence he obtained from’ the prosecutor, &c.; but in the present indictment this averment also is omitted. On that short ground I think it safer to quash the conviction. There is a form, nearly a hundred years old, for these indictments, which every lawyer may know, and I do not understand why it should not be followed; the result of not following it here is that two averments are omitted which are essential parts of the charge.”

Almost as soon as that case was decided it was distinguished in R. v. Silverlock [1894] 2 Q.B. 766. Count 2 in that instance averred that, by inserting an advertisement in a named newspaper, the accused had, by falsely pretending “to the subjects of Her Majesty the Queen” that he required a housekeeper for a particular place, obtained a cheque from Rose Coates. In upholding the conviction on that count, Lord Russell C.J. said that the count satisfied the requirements of the law by stating the essential conditions of the offence. He disposed of R. v. Sowerby on the double ground that, in that case, two material allegations were absent; and that, in the case before the Court (R. v. Silverlock), the allegation that the false pretence was made to all the Queen’s subjects, although loosely drawn, “becomes particular as regards the particular person who acts upon it” ([1894] 2 Q.B. 776, 771). Mathew J. (who was one of the judges who decided R. v. Sowerby), held that it was necessary for the indictment to be framed in accordance with the old rules of pleading (by which, he said, “we are still hampered”) in a civil action for deceit, in which all the ingredients of the defendant’s liability had to be set out with particularity; but that, although the indictment there offended against the old rules of pleading, it was no more than an imperfect averment, which had been cured by the verdict of the jury ([1894] 2 Q.B. 776, 772- 773). His Lordship went on to say that R. v. Sowerby was a case in which two material averments had been omitted from the indictment, with the consequence that if the accused there had been acquitted on that defective count, and subsequently prosecuted for the same offence on a good count, “there might have been a difficulty in the way of the defence”.

In England, the decision in R. v. Sowerby was finally discarded in R. v. Johnstone [1950] 1 All E.R. 830, where Lord Goddard C.J. pointed out that the form in the schedule to the Indictments Act 1915 no longer required a statement of the person to whom the pretence was made. In Queensland, the form, which is no. 255 in the Schedule to the Criminal Practice Rules of 1900, still retains the requirement that the name of the person to whom the pretence was made be stated. To that extent, R. v. Johnstone is not directly applicable in this jurisdiction; but what the decision does demonstrate is that the requirement is one that, because it is capable of being dispensed with merely by an alteration in the prescribed form, is one of form rather than substance. See also R. v. Kealey (1851) 2 Den. 68; 169 E.R. 421, where a conviction on an indictment charging the making of a false pretence to “John Baggally and Others” was upheld on proof that the pretence had been made to John Baggally alone. Jervis C.J. and Patterson J. considered that the addition “and others” should be rejected as surplusage.

The reason why the indictment in R. v. Kealey had been drawn in that form was that John Baggally was a member of a partnership, and it was evidently believed that, on one view, by making the pretence to John Baggally, it had been made to all the members of the partnership. Cases of that kind do perhaps afford a difficulty to the pleaders. In the case before us, the sum of $41,500 was proved to have been obtained from AGC, and it was to that corporation, acting by its agents Carlson and Jansen, that the false pretence or representation was made. However, to have averred that the pretence was made to AGC would have told the appellant little or nothing that was at all informative, when his real concern would have been to know the identity of the particular individuals to whom the representation was alleged to have been made.

The pleader accordingly and, it might be thought, helpfully nominated the particular individuals who participated in the relevant conversations. It is, as appears from R. v. Welman (1853) Dears. 189; 189 E.R. 690, possible for a conviction to be sustained on proof of the making of a false representation that is not acted upon until after a second conversation has taken place, provided that, as the Court said in that case, the two conversations are capable of being connected. In such circumstances, it is the cumulative effect of both conversations that supply the pretence and the inducement to act upon it. In this instance, therefore, it would no doubt have been permissible for the pleader to have averred that the money was obtained from AGC by falsely pretending “to Peter Carlson and John Martin Jansen or one of them” that Riverford had recently purchased and was the owner of the Commodore vehicle in count 3. Instead, the averment was expressed in the form “Peter Carlson or John Martin Jansen”.

It is not easy to see how an averment in that form could have been a source of difficulty for the appellant in conducting his defence at the trial, and none was identified on appeal. Only one offence of obtaining money in the sum of $24,750 was alleged in count 3. There is consequently no possibility that, if he had been acquitted on that count, he might have been prosecuted and tried again on a further indictment charging the making of a false pretence to Carlson rather than to Jensen, which was the particular difficulty mentioned by Matthew J. in R. v. Silverlock [1894] 2 Q.B. 776, 772; cf. also R. v. Kuff [1962] V.R. 578, 591.. The charge in count 3 was not bad for duplicity; nor was the charge in count 6 or in count 9, each of which alleged the obtaining of an identified sum of money from AGC.

Mindful perhaps of the recent decision in Walsh v. Tattersall (1996) 70 A.L.J.R. 884, the learned trial judge in summing up directed the jury that they ought not to return a verdict of guilty unless they were satisfied that the operative false pretence was made either to Carlson or to Jensen, and, his Honour continued;

“You must be unanimous in your choice ... you could not, for instance, half of you say that the false pretence was made to Mr Carlson and the other half say it was made to Mr Jensen ... All of you must be satisfied as to the person to whom the false pretence was made.”

If the jury adopted that suggestion, the effect of the direction was to leave the case to them on the footing that in the case of each count the money had been obtained from AGC by a false pretence made to Jansen. The evidence of what was said to Carlson nevertheless remained admissible if, according to R. v. Welman (1853) Dears. 190, 198; 169 E.R. 690, 694, the conversation with him was “connectible” with the conversation with Jensen so as to make them “one continuing representation”. In R. v. Welman, Jervis C.J. considered it was for the jury to determine whether such a connection existed. Instead of directing the jury to decide that question, the trial judge here seems himself to have assumed the connection between what was said to Carlson and what was said to Jensen. Having suggested that they would probably decide that Jensen was the person to whom the false pretence was made, he added:

“That does not mean, of course, that you treat as irrelevant what was said to Mr Carlson, because you will appreciate that his evidence is very important in the case as to discussions he says he had with Mr Drew.”

The successive conversations with Carlson and Jansen were, however, so plainly connected in this case that the jury could and would have been left in no doubt that one continuing representation was involved. No point was made of this on appeal or at the trial; and, to the extent that the omission to direct the jury on that question can be considered a defect in the summing up, the case is clearly one in which the proviso to s.668E(1) of the Criminal Code should be applied.

As to sentence, in imposing a term of imprisonment for 2½ years, the learned judge described the three offences as a “carefully planned and sophisticated fraud on a financial institution”, in which the appellant had displayed “a deal of cunning”. AGC had ultimately lost about $28,900 of the loan of $41,500, and there was no prospect of restitution because the appellant is bankrupt. The total loss arose on the sale of the Commodore, to which AGC had no title, and from losses on the Ford Falcon vehicles, when on default in payment those two vehicles were later repossessed and sold for less than the value for which it was represented that Riverford had bought them.

At the time of sentencing, the appellant was 46 years of age, and had two children, but had separated from their mother. He had no prior convictions, and from the age of 16 had served 12 years in the Royal Australiana Navy. He had, it seems lost the hire car business as a result of selling it to a purchaser who, it was said, “reneged” on the transaction. That may have been partly because of the absence from the fleet of the Commodore vehicle belonging to Mr and Mrs Burgess, although some form of fraud is also said to have been perpetrated on the appellant by the purchaser himself or his solicitor.

What led his Honour to impose the sentence he did, and to describe the offence as “sophisticated” and “cunning”, was almost certainly the appellant’s use of the fabricated receipts to misrepresent the true status of the vehicles to AGC. The judge rightly considered the matter to be one in which the deterrent element in sentencing was prominent. On the strength of the decision in R. v. Huber (C.A. No. 23 of 1995), which counsel for the appellant at the sentencing described as being “almost on all fours”, it was submitted that the appellant should undergo imprisonment for two years “but no more”. Starting from that point, a sentence of 2½ years can scarcely be described as beyond the permissible range in the case of the appellant. The judge declined to make a recommendation for parole because, as he viewed the matter, the appellant had shown no remorse for his actions. Consistently with the principles on which this Court acts in applications of this kind, it is not possible to conclude that the sentence in this case should be reviewed or revised.

The appeal against conviction should be dismissed, and the application to extend the time

within which to apply for leave to appeal against sentence should be refused.
I am authorised by Lee J. to say that he concurs in these reasons and in the orders proposed.