R v Fagan

[2019] NSWDC 777

District Court

New South Wales

Medium Neutral Citation:

R v Fagan [2019] NSWDC 777

Hearing dates:

30 July 2019

Date of orders:

30 July 2019

Decision date:

30 July 2019

Jurisdiction:

Criminal

Before:

M L Williams SC DCJ

Decision:

A term of imprisonment of 13 years with a non-parole period 7 years, 3 months: at [46].

Catchwords:

CRIME — Drug offences — Commonwealth offences — Import/Export border-controlled prohibited plant or drug
SENTENCING — Mitigating factors — Good character Plea of guilty — Remorse
SENTENCING — Relevant factors on sentence — Circumstances of offence Objective seriousness — Deterrence — Establishing relevant matters — General principles — Co-offenders — Parity
SENTENCING — Subjective considerations on sentence — Drug addiction

Legislation Cited:

Court Suppression and Non Publication Order Act 2010
Crimes Act 1914 (Cth)
Criminal Code 1995 (Cth)

Cases Cited:

DPP (Cth) v De La Rosa (2010) 79 NSWLR 1
Hili v The Queen; Jones v The Queen (2010) 242 CLR 520
Klomfar v R [2019] NSWCCA 61
Lau v The Queen [2011] VSCA 324
R v Zalapa (unreported, NSWDC M L Williams SC DCJ, 31 May 2018)
R v Nguyen; R v Pham [2010] NSWCCA 238
R v Nicketic [2002] NSWCCA 425
R v Phelps (unreported, NSWDC, M L Williams SC DCJ, 6 April 2018)
R v Phelps; R v Zalapa [2018] NSWCCA 191
R v Qutami (2001) 127 A Crim R 369
R v Schwartz [2018] NSWDC 118
Van Zwam v The Queen [2017] NSWCCA 127

Texts Cited:

Nil

Category:

Sentence

Parties:

Regina (Crown)

  Jonathan Fagan (Offender)

Representation:

Mr K Perrignon (Crown)

 

Mr M Johnstone SC (Counsel for the Offender)

  Mr M Smith (Counsel for the Offender)

File Number(s):

2015/270614; 2015/285417

Publication restriction:

NON-PUBLICATION ORDER re the provision of any confidential material, evidence or submissions tendered in closed court or referred to during proceedings

Judgment

1. A 34 year old man faces a maximum sentence of life imprisonment for his substantial involvement in the importation of border controlled drugs. For much of his education, he had the benefit of attending the Scots College in Sydney, and as was said by Berman DCJ in sentencing a co-offender, there is very little, if any, that could be said by way of a disadvantaged background for this young man. He had every opportunity available to him, on the evidence that I have in front of me. He has pleaded guilty to one count of importing a commercial quantity of border controlled drug between 15 January 2014 and 3 August 2015 under s 307 of the Criminal Code1995 (Cth).

2. I will allow a 20% discount on a term of imprisonment due to the plea of guilty in the circumstances set out in the evidence and the submissions to which I will refer. A further 15% discount on a term of imprisonment will be allowed in relation to the matters addressed in Exhibit C and during closed court. A total discount of 35% on a term of imprisonment will be imposed.

3. In short, between 15 January 2014 and 3 August 2015, the offender was engaged in the organised commercial activity of repeatedly importing consignments of cocaine into Australia. There are a total of 14 consignments that were sent by DHL Air Freight from California. The net weight of the cocaine was, at least, 88 kilograms and the pure weight at least 70.9 kilograms.

4. The offender’s premises were subject to a search warrant on 15 September 2015. He was found to be in possession of $9,900 which he knew to be the proceeds of crime. He was also in possession of a number of illegal drugs with the intent of selling them, namely, 74 grams of methamphetamine, 59 grams of methylenedioxy cathinone, 35 grams of methyl-amphetamine and .52 grams of dimethoxybenzylamine.

5. The criminal syndicate importing cocaine into Australia, was principally organised by Owen Hanson, a US national. He was arrested in 2015 and charged in relation to the importations and he provided a detailed statement about the activities of the syndicate including details as to the 14 importations of cocaine for which the offender was charged.

6. Thirteen of the 14 consignments were successfully received by the Australian syndicate and only the last, which arrived in August 2015, was seized by Police. The boxes were addressed to false consignees and addresses, the details of which were provided to Hanson by a man named “Hairy”, a member of the syndicate on the Australian side. Hanson communicated with “Hairy” and other members of the syndicate over a phantom secured network using BlackBerry devices which are commonly used by organised crime syndicates, as they provide secure communications, total anonymity, an unbreakable military grade encryption and a remote data wiping service. The consignments were collected in Australia by members of the syndicate, including the offender, using false identification. The consignee telephone numbers on each consignment were for burner phones, that is, single use falsely subscribed mobile phones used solely for the importations.

7. Hanson had not met anyone from the Australian syndicate besides “Hairy” and he was not able to identify the offender or Schwartz, another Australian syndicate member. There was no telephone intercept or listening device product suggesting that Hanson communicated with the offender.

8. In relation to the first 13 counts even though they were successfully collected by the offender, he acknowledges that each of them were sent from the US to Australia by Hanson and his associates. He collected each of them, using false identification and each contained cocaine. The net weight was at least 78 kilograms, and the pure weight of the first 13 was at least 62.4 kilograms.

9. Part of the material in dispute, goes to the issue of whether the offender was reckless as to the fact that the consignments contained drugs or whether he had actual knowledge as to that fact. For the reasons that I will deal with, I accept the Crown’s submission that it has been established beyond reasonable doubt that the offender did have knowledge that the consignments contained drugs and without any disrespect to Mr Johnston SC it could accurately be said that his ultimate submission on that point was faintly put, given that he said that he did not have instructions to concede knowledge but he raised a number of matters in his written and oral submissions which I have taken into account in coming to that view.

10. The offender obtained false driver’s licences that matched the consignee details and a number of those licences were seized when his premises were searched in September 2015. He was found in possession of a number of falsely subscribed mobile telephones, of which a number were linked to the consignments in some cases.

11. The fourteenth and final consignment was sent from the United States on 30 July 2015 and arrived on 3 August 2015 in Sydney. On that day, the offender, using a false name and a burner phone, called DHL and enquired about the whereabouts of the package. He was told that the quarantine people were looking at it. The package was examined by Custom’s officers who found the cocaine in the consignment. The cocaine was 83.9% pure. The wholesale value of the last consignment was estimated at $1.845 million and the street value was estimated at $2.726 million.

12. A controlled operation authority was obtained to permit a controlled delivery, but no one attempted to collect the items and the address for delivery was occupied by a third party unconnected to the investigation.

13. Evidence established that between January 2014 and September 2015, and that is over the period of offending covered by the indictment, the offender took at least 75 domestic trips by air, train or bus; from Sydney to Melbourne on 31 occasions, Sydney to Brisbane 10 times, Sydney to Coolangatta three times, Sydney to Maroochydore twice and Sydney to Perth and to Canberra on one occasion each. The offender made payments to various travel agents for accommodation and flights costing a total of $68,000. At least 14 of these transport tickets were purchased in the false consignee names used for the consignments and five of them matched the false driver licences found in his possession. The travel ordinarily extended over a period of one or two days but on at least ten occasions he was only absent from Sydney for a few hours.

14. On 29 August 2015, he went to the Gambaro Hotel in Brisbane and he was met in the foyer by Matthew Delander, an associate of his who was the subject of a police investigation into drugs and weapons trafficking. Delander later pleaded guilty to and was sentenced for a number of offences in Queensland. They both went into a hotel room booked in the offender’s name and left about ten minutes later. An associate of Delander, acting under his instruction, took a taxi to the hotel at about 3am and she was met by the offender in the foyer. They exchanged Sportsgirl branded shopping bags. A search warrant executed at his hotel after he left disclosed the presence of rubber bands, three open cardboard post packs with tamper proof zip ties and serial numbers and a plastic post pack. When a search warrant was executed at his premises in Sydney 15 days later, a number of items were seized including four pages of handwritten notes some on Gambaro Hotel letterhead. Delander was sentenced in June 2018 to a total of nine years imprisonment for drug related and firearms offences.

15. In March 2014, the offender travelled overseas with his then partner to Thailand and Cambodia. He paid $21,000 for that trip. In May 2015, he purchased flights for his partner to fly to Paris at a cost of $13,000, paid for in cash to the Flight Centre. Tax Office records show that he was not required to submit any tax returns for the income years 2014, 2015 and 2016. There is no evidence of employment during the offending period or the months leading up to it. Nevertheless, a total of $430,799 in cash was deposited into his Westpac account between January 2014 and September 2016. While $64,000 of that money have been attributable to his mother, the source of the remaining cash deposits is unknown.

16. He was initially arrested, as I have indicated, on 15 September 2015 and charged with a number of other unrelated domestic violence offences and assault offences which were ultimately discontinued. The only entries on his criminal record are, the Crown concedes, very minor matters of some antiquity in Tasmania.

17. Apart from the drugs that were found on the execution of the search warrant, there were 12 mobile phones, numerous empty packets of pre‑paid SIM cards, each subscribed in false names, $9,900 in cash, a currency counter, seven sets of electronic scales, restricted substances including testosterone and trenbolone, and six New South Wales driver’s licences bearing his photograph and false names and addresses.

18. He was charged in relation to the drug items and the false driver’s licences on 29 September and was on bail when he was arrested a year later on 12 September 2016. He was then found to be in possession of three mobile phones, two of which were encrypted BlackBerries in false names. Both had their lights flashing, indicating they had been in use. This was in breach of a condition of his bail that he possess and use only one mobile phone. He declined to participate in a record of interview.

19. Those agreed facts have been summarised in an executive summary, and further detailed in a summary of the Crown material on sentence which is supported by contemporaneous objective material as part of the Crown bundle, but it is unnecessary for me to deal with that material.

20. The offender has been in custody since his arrest on 12 September 2016. It is conceded that a term of imprisonment is required and in the circumstances it is unnecessary for me to consider any alternatives. The term of imprisonment will commence on the date of his arrest, namely 12 September 2016.

21. The offender expresses remorse and regret for his actions and acknowledges the shame that he has caused to his family and loved ones, and the untold damage to the community by reason of his offending. He acknowledges that he is fortunate to have a loving family, in particular a mother who has done everything possible to help him in his struggle with addiction, gaol and life in general and he also has a loving partner of six and a half years.

22. The offender did not give evidence today. He provided a handwritten letter to the court and relies upon a number of other documents including reports from a psychologist and medical practitioner. The Crown correctly reminds the court of the caution with which untested histories are to be treated in the light of cases such as R v Qutami (2001) 127 A Crim R 369 and R v Nicketic [2002] NSWCCA 425. However balanced against that is what was said by Campbell J in Van Zwam v The Queen [2017] NSWCCA 127, and while not directly applicable to the circumstances of this case it is worth bearing in mind that his Honour said of the offender there, given his prior good character and the circumstances in which he was drawn into the offending I do not find those statements of remorse to be inherently implausible. Indeed it strikes me as entirely plausible that a man of his education and the antecedents would be genuinely remorseful about his involvement in serious offending of this type. It is for this reason that his prospects of rehabilitation are good and his risk of re-offending is low.

23. He has been working while in custody, completing courses in Occupational Health and Safety, and addiction recovery, and expresses his sincere apologies to the court and the community for his actions. In a lengthy history given to Mr Watson-Munro the only distressing event that he recounted was the separation of his parents when he was about 12. His father is a retired pharmacist. His mother has been with his stepfather for the past 22 years. He spent much time at Scots College in Sydney, before returning to Tasmania for some years, but then returning to complete his final years of high school in Sydney at Scots College. He attended the University of Tasmania for a year, studying a Bachelor of Business before travelling overseas and becoming involved in an event management company running music festivals for about six years. He then worked in business development in Sydney for about three years. Over recent years his employment has been limited due, apparently, to his escalating drug use, which started during Year 8 at the age of about 13. He was involved in MDMA crystal methamphetamine or ice and cocaine mixed with alcohol. As the Crown pointed out, he admitted that his cocaine use of up to seven grams a day would have a dramatic impact upon his financial position.

24. Although the offender said to Watson-Munro that his judgment was dramatically impaired as a consequence of his drug use, the psychologist did not say that his judgment was impaired to the point where he was unaware of his wrongdoing, nor indeed its consequences and Mr Johnson SC does not put that there is any DPP (Cth) v De La Rosa (2010) 79 NSWLR 1 type reduction of moral culpability open for consideration here. However there is other objective material apart from the history given to Mr Watson-Munro which supports the history of drug use and addiction which should be taken into account. Dr Hardy, a consultant specialist in addiction medicine, saw the offender on five occasions in 2012, once in 2013 and then regularly since October 2015, that is after his first arrest, including two hospital admissions as well as weekly or fortnightly attendances as an outpatient between those admissions.

25. He presented with a history of alcohol dependence requesting de-toxification, at the time being 27 years old, and drinking a bottle of spirits a day, and also consuming methamphetamine, cannabis and MDMA. There was a history of AVOs being taken out against him. He had previously been to South Pacific Private Hospital in 2005 in the context of poly-drug misuse including alcohol, cannabis and MDMA. He managed to remain sober for several months but then relapsed. He had been diagnosed with an anxiety disorder, and Dr Hardy described his progress over the period from October 2015 to September 2016 as astonishingly good. He had de-toxified off alcohol and other substances and commenced a profound and thorough course of therapy and rehabilitation with outpatient groups at the Sydney Clinic and The Cavern in Edgecliff. His ultimate diagnosis was poly-substance use disorder in remission, anxiety disorder which was active, and drug induced delirium in remission. He prescribed an ongoing treatment plan and the attendance at The Cavern is supported by a letter from Joshua Roves, the Clinical Manager of that rehabilitation centre.

26. He saw the offender from December 2015 up to the present time on a fortnightly basis in custody, and has assisted with his mental health and addiction issues. He said that the offender has taken responsibility for his offences and he has expressed remorse and presented high levels of shame and guilt. Those expressions to those people buttress my acceptance of his expressions of remorse to the court in a handwritten letter and a letter from Stephanie Wong at the Community Restorative Centre supports the offender’s assertion about his active involvement in rehabilitation programs while he has been in custody.

27. I have been greatly assisted by comprehensive written submissions prepared by the Crown and by Mr Johnston SC for the offender. There is not a great deal in dispute as a result of the effort put into those submissions, and it is unnecessary for me to repeat the detail of everything that was put in the submissions.

28. I accept, in the light of the matters to which I have referred, and will now summarise, that the offending falls, as is common ground, above midrange of objective seriousness. To get to that assessment one must follow the process of examining the sentencing regime set out in Pt 1B of the Crimes Act 1914 (Cth).

29. I bear in mind the five matters on a s 16BA schedule, first dealing with the proceeds of crime and four trafficking counts in relation to the drugs found in September 2015. They are dealt with in an analogous way to that suggested by the Chief Justice in the guideline judgment on state matters Form 1 matters, namely by giving greater weight to the need for personal deterrence and the community’s entitlement to extract retribution for serious offences.

30. The nature and circumstances of the offence is considered in the light of the principles set out by Johnson J in R v Nguyen; R v Pham [2010] NSWCCA 238 accurately summarised by the Crown, but also noting as the Court recently said in Klomfar v R [2019] NSWCCA 61 that an offender

“can draw no comfort from the reference by the sentencing judge to his being a ‘courier’ whose role was ‘limited and lower and in the hierarchy’. Characterising an offender in that way must never obscure an assessment of what the offender actually did.”

Here, the criminal enterprise in which the offender participated was sophisticated with a high degree of planning and coordination as demonstrated by the fact that there was a compartmentalised structure affecting each stage of the importation with a number of people engaged to execute different roles. In particular, he obtained false driver’s licences, a number of falsely subscribed mobile phones, identified himself as a false consignee on at least one occasion, was given knowledge of the airway bill numbers of the consignment, he was trusted by the syndicate to present himself as the false consignee and receive consignments on 14 separate occasions, and his participation spanned more than 18 months. As the Courts have said, illicit drug operations such as this are only able to prosper because people are ready, willing and able to undertake the type of role that the offender performed, even though he exposes himself to the risk of arrest on collecting assignments.

31. His role was accurately described as being a highly trusted facilitator and intermediary and not merely a collector because, for the reasons set out by the Crown, he knew on each occasion that he had successfully completed the syndicate’s importation of a parcel with illicit contents. He knew, for the reasons that I will summarise, that the consignments contained illicit drugs. It was an objective fact that each of the consignments had a wholesale value of about $1 million, and the wholesale value of the seized 14th consignment was about $2 million. It can readily be inferred that the syndicate would not have relied upon the offender on 14 separate occasions to pick up many millions of dollars’ worth of cocaine unless he was considered to be extremely trustworthy and reliable enough to effect collection without detection. His criminality is fundamentally informed by the length of time over which the offending has occurred, and his awareness of the syndicate’s methodology and his own role, which was established from the first consignment, and then repeated on 13 occasions over 18 months.

31. The matters to which the Crown referred in support of the proposition that the offender had actual knowledge rather than any recklessness was, first, the evidence of the degree of assistance, secondly, the drug paraphernalia found at his home in September 2015, thirdly, the observations of his activities at the Gambaro Hotel on 1 September, fourthly, the number of trips that he had carried out interstate over the period of the offending, during a time when he had no known employment and was travelling at considerable expense, and fifthly, the acknowledgement to Watson‑Munro of his financial dependence upon cocaine and his substantial cocaine use.

32. Apart from common-sense inference frequently drawn in cases such as this, in the absence of evidence to the contrary, here the unexplained significant cash deposits into the offender’s bank account and the extravagant spending on travel is so disproportionate to his circumstances that the only rational conclusion is that he was deriving a substantial benefit from an illicit income stream in that period.

33. As the Crown points out, even if a finding of recklessness is made that is not necessarily a mitigating factor, however as the Court said in Lau v The Queen [2011] VSCA 324 at [26],

The legislative scheme makes it clear that offenders who are reckless as to the nature of the substance imported, rather than having a specific intention to import a border controlled drug, are to be treated in the same way as offenders who do so intentionally. If it had been intended to treat reckless offenders differently from those who act intentionally, this would have been reflected in separate provisions imposing a lower maximum sentence on the former than the maximum sentence imposed on the latter.

35. General and specific deterrence and punishment are very significant factors to be taken into account so that the community and those minded to offend are informed in the clearest possible terms of the severe punishments that such offending involves when detected.

36. His prior good character, as Johnston J said in R v Nguyen; R v Pham [2010] NSWCCA 238, is generally given less weight as a mitigating factor because good character is not an unusual characteristic of people involved in drug importation and as is often the case the offender’s absence of a significant criminal record must have contributed to his usefulness to the syndicate as a person based in Australia who is less likely to be the subject of any known law enforcement interest.

37. As I have indicated his expressions of remorse and the evidence as to his rehabilitative efforts in custody demonstrate that his prospects of rehabilitation are reasonable, and with the family support that he has, his prospects of reoffending must be very limited.

38. Both counsel have provided a helpful summary of supposedly comparative sentences imposed in other cases and I have regard to those in the way the court set out in Hili v The Queen; Jones v The Queen (2010) 242 CLR 520.

39. I have had regard to the judgment of Berman DCJ in R v Schwartz [2018] NSWDC 118 another co-offender, and also the sentences imposed in R vPhelps (unreported, NSWDC, M L Williams SC DCJ, 6 April 2018) and R v Zalapa (unreported, NSWDC M L Williams SC DCJ, 31 May 2018) which were subject of unsuccessful challenges by the Crown (R v Phelps; R v Zalapa [2018] NSWCCA 191). However issues of parity have very limited relevance in this case as the Crown indicates given that this offender’s activity and the quantities of border controlled drugs that he dealt with over a large number of consignments were fundamentally dissimilar to the few consignments and lesser quantities involved in the offending by Schwartz, Phelps and Zalapa.

40. Mr Johnston SC points out that there is no evidence that the offender was associated with any overseas aspect of the importations and none of the offenders arrested in the United States have made any reference to this offender and it is clear that he did not meet Owen Hanson. It is true, as I have indicated, that he was exposed to the greatest risk of detection but rather than that pointing to the expendable nature of his role being someone at the bottom of the hierarchy it points, as the Crown submits, to someone trusted to claim possession of the valuable packages, and Mr Johnston SC ultimately acknowledged that there was plainly a degree of trust reposed in him.

41. As to the expensive domestic travel the Crown puts that the fact that the offender travelled under false consignee names on several occasions combined with the unexplained short durations suggest that his travel was connected with the delivery of drug consignments and the importing drug syndicate, and the Court it is submitted should infer that the illicit enterprise that he offender was participating in was sophisticated, developed and far-reaching due to the frequency of his travel and the number of locations visited.

42. While Mr Johnston acknowledges that they may raise a suspicion there is no specific evidence that they involve the imported cocaine or in fact involved other drugs such as those found at the home of the offender. While there is no evidence of an extravagant lifestyle there is nuance of the significant sums of money going into the offender’s account, and ultimately I accept, as the Crown submits, that it has been established to the relevant standard that the interstate travel was for the purposes of delivering drugs on at least some occasions as indicated by material in relation to his attendance at the Gambaro Hotel to which I have referred.

43. Mr Johnston SC ultimately accepted that this offender will inevitably receive a significantly longer sentence than that imposed on Phelps but he made no specific submissions, as to the comparability of the sentences imposed upon Zalapa and Schwartz.

44. I take account of the principles of parity to the limited extent to which I have referred given the differing factual circumstances of those other offenders. The ultimate governing principle to be applied is that the Court should impose a sentence which is of a severity appropriate in all the circumstances of the offence, taking into account all the matters to which I have referred and the non-parole period is the minimum time which should be spent in custody having regard to the objective and subjective circumstances of the case.

45. In this case, given the sustained offending over a lengthy period of time involving very significant amounts of illicit drugs it is clear a significant term of imprisonment is required.

46. The orders that I make is that:

1. The offender is convicted of the offence.

2. Taking into account the s 16BA Schedule matters, I impose a sentence of imprisonment of 13 years, to commence on 12 September 2016.

3. I impose a non-parole period of 7 years, 3 months, expiring on 11 December 2023.

4. I make a non-publication order pursuant to s 7 of the Court Suppression and Non Publication Order Act 2010 in relation to the provision of any confidential material, evidence or submissions tendered in closed court or referred to during proceedings.

Note – These extempore remarks were revised without access to the court file

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Decision last updated: 20 January 2020