R v Farmer

[2008] QDC 327

DISTRICT COURT OF QUEENSLAND

CITATION:	R v Farmer [2008] QDC 327
PARTIES:	R v SHANE FRANCIS FARMER
FILE NO/S:	Indictment 324/2006
DIVISION:	Criminal
PROCEEDING:	Application for Permanent Stay of Indictment
ORIGINATING
COURT:	District Court
DELIVERED ON:	17 December 2008
DELIVERED AT:	Beenleigh
HEARING DATE:	17 December 2008
JUDGE:	Dearden DCJ
ORDER:	Indictment 324/2006 be permanently stayed
CATCHWORDS:	Criminal Law (Qld) – Fraud – Stealing - Application for permanent stay of indictment – Absence of relevant documentation – Estoppel – Abuse of process – Right to fair trial - Exceptional remedy
LEGISLATION:
CASES:	R v Easterday (2003) WASCA 69 Jago v The District Court (NSW) (1989) 168 CLR 23 Johannsen and Chambers (1996) 87 A Crim R 126
COUNSEL:	Mr C Chowdhury for the applicant/defendant
Mr P McCarthy for the respondent
SOLICITORS:	Bradley and Associates, solicitors for the applicant/defendant
Director of Public Prosecutions for the respondent

HIS HONOUR: [1] This is an application by the defence seeking to stay counts one, two and three of indictment 324 of 2006. An indictment which alleges against the defendant, Shane Francis Farmer, the following counts: count 1. fraud as an employee to the value of $5,000 or more; count 2. stealing as a servant; and count 3. fraudulently altering a record. I note at the outset that this application for a permanent stay of the indictment is conceded by the Crown, and I thank Mr McCarthy for his frank and open acknowledgement of the difficulties which lead the Crown to make the relevant concession.

[2] In those circumstances it's not necessary for me to place on record the level of detail which I might ordinarily have placed on the record, but because it requires me to exercise a discretion, it is necessary to place, at least briefly, a short outline on record, and in that respect I express my gratitude to Mr McCarthy for his submissions outlining the issues, and to Mr Chowdhury who has provided a remarkably modest but extremely detailed and helpful written outline of submissions to which there's been no necessity in the circumstances to expand on orally, other than to note Mr Chowdhury's acknowledgement of the steps, which have been quite extraordinary, in fact, given that I've been supervising this case now for some lengthy period of time, to which the Crown has gone to seek to meet the request of the defence to locate what it's now accepted are permanently missing documents.

[3] Briefly, the background to the matter as outlined by Mr McCarthy is this. The defendant, Shane Farmer, was an employee of an organisation which was called Southside Support Group for Families of Handicapped Children Inc., and the allegation was that he had dishonestly defrauded that organisation over a period between 15 March 1998 and 26 November 2002, a total of $178,012.39 (count one); that he had stolen a quantity of documents, a quantity of books and a computer (count two); and further, that he had again over that relevant period with intent to defraud altered a bank record (count three).

[4] The defendant was employed by that organisation (Southside Disability Services) from 16 May 1998 and from February 1999 was appointed and acted as the Chief Executive Officer (CEO) of the organisation. On 4 December 2002 the Board of Directors became aware of what it considered to be a discrepancy in the accounting records, and the blame for that discrepancy was attributed to the defendant.

[5] The allegations were that there were over-payments by the defendant as CEO to himself without the authority of the complainant organisation. The cross-examination of the former Chairperson of the Board of Directors, Diane Wisowaty, at the committal revealed what Mr Chowdhury describes in his written submission as "a number of extraordinary gaps in the prosecution case". Although Mr McCarthy hasn't explicitly adopted that description, it is clear from his frank and appropriate concessions in oral submissions that the description by Mr Chowdhury in his written submissions is an entirely apt description of the situation.

[6] The cross-examination revealed that the complainant organisation no longer had the defendant's original contract of employment. Ms Wisowaty conceded that the payments made to the defendant differed from the contract, and clearly left open the inescapable inference, it would seem, that there was an incentive system in place, and, in fact, receipts of payments were produced.

[7] The fundamental difficulties for the Crown arise from the nature of certain missing documents, in particular, quarterly audits which had been conducted during the entirety of the employment which were almost completely missing (there were it appears no quarterly audits able to be located for at least a period of four or five years) and, secondly, the absence of a significant number of the Board minutes, in fact, almost the entire Board minutes over the period of time during which the defendant was in employment, with the absence of minutes for two specific months in 2001.

[8] It was alleged as part of the particulars by the Crown (or perhaps more properly would have been alleged had the matter proceeded to trial) that payments from the organisation, Southside Disability Services, to three specified persons via their bank accounts were part of the fraud. There were payments made to Ms Croft who was at the relevant time, and apparently still is, the defendant's partner. Those payments it was alleged were made into her account without authority, but it was asserted on behalf of the defence that Ms Croft had been appointed a secretary in the organisation and was on the payroll, but the missing audit reports and minutes mean that that highly relevant line of enquiry open to the defence was effectively estopped.

[9] A former partner of the defendant's, a Ms Drysdale, had payments made into her bank account, and it was asserted on behalf of the defence that they represented bonuses payable to the defendant. Again, the missing minutes and audit reports estopped the defence from pursuing that particular line of enquiry.

[10] Thirdly, a Mr Umbool received payments which were asserted by the defence to have been a receipt of legitimate loan payments or payment, and, again, the absence of the minutes and the audit reports made it impossible to either confirm or deny that assertion and estopped the defence from pursuing that line of enquiry.

[11] Further allegations that purchases of a ride-on mower and computer were part of the fraud, were unable to be pursued as a legitimate line of enquiry as to whether they may have been legitimate capital purchases because of the absence of the minutes and the relevant audit reports.

[12] Mr McCarthy again frankly concedes that in addition to these particular lines of enquiry, there may well have been other lines of enquiry now estopped because of the absence of the relevant documentation.

[13] The written submissions by Mr Chowdhury, which for the record I will mark Exhibit 1 on the application for the stay, and gratefully acknowledge as they summarise in short but helpful detail the relevant situation, indicate that as I've outlined, there are only two monthly Board minutes able to be located between the period of 1998 and November 2002, and none of the relevant quarterly audits over the period that Mr Farmer was employed, were able to be located in any of the relevant files including those in the position of the liquidator of Southside Disability Services, Korda Mentha.

[14] Also missing were a large number of bank confirmation reports which would have been anticipated, it seems, to have formed part of the organisations records.

[15] A forensic accountants report provided by Ms Bundesen of BDO Kendall, and no doubt sought to be relied on by the prosecution, clearly suffered the inherent difficulties that any such expert report suffers, because it was based on inadequate information and documentation, and in those circumstances, of course, there could no criticism of Ms Bundesen for a failure to supply full and adequate information, nor was she asked to perform a full audit of the statements of Southside Disability Services.

[16] Mr Chowdhury also notes in his summary that significant important information, critically the gross salary of the defendant, was wrongly provided or more properly that information was clearly wrong, as provided by Ms Wisowaty.

[17] The cross-examination of Ms Wisowaty at the committal, which it appears was done with some significant care by Mr Chowdhury, indicates significant difficulties, for example, with the actual salary paid to the defendant as evidenced by Ms Wisowaty's acknowledgement of reports that she'd signed, and that, as Mr Chowdhury indicates, raises grave concerns about her reliability as a witness. Those concerns about her reliability, however, are not ultimately the grounds on which any stay could be granted, as difficult as they make the case for the Crown.

[18] The absence of the relevant material (the monthly Board minutes and the quarterly account audits) is the clear, obvious and inescapable basis on which, in my view quite properly, the application for a permanent stay is sought, and is conceded by Mr McCarthy for the Crown.

[19] In Johannsen and Chambers (1996) 87 A Crim R 126, Thomas J (p142) stated, "The question whether criminal proceedings should be permanently stayed on the ground of abuse of process is answered by a balancing of a variety of factors which include the requirement of fairness to an accused, the legitimate interest of the public in the disposition of charges of serious offences and in the conviction of those guilty of a crime, and the need to maintain public confidence in the administration of justice."

[20] It is as the High Court has reminded us in Jago v The District Court (NSW) (1989) 168 CLR 23, an extraordinary remedy and is to be reserved only for an exceptional case. Mr McCarthy helpfully brought my attention to the decision of the Western Australian Court of Criminal Appeal in the matter of Easterday (2003) WASCA 69.

[21] In particular Mr McCarthy has drawn my attention to paragraphs 194 to 203 of the reasons for decision by his Honour, Justice Steytler, together with his conclusion at paragraph 371, and the earlier observations of his Honour, Justice Scott at paragraphs 147 and 148. His Honour, Justice Scott, noted that in his opinion the central issue in the appeal was a failure by the Crown to disclose the existence and contents of a particular report (an Australian Stock Exchange Surveillance Report 55/1990), which in the relevant case was part of material not disclosed by investigating police to the Director of Public Prosecutions and, therefore, not within the knowledge of the Director of Public Prosecutions to disclose to the defendants.

[22] As Justice Scott noted, "The nature and contents of that report was such that they clearly should have been disclosed." He went on to say (in adopting a submission by counsel for the appellants) that "revelation of that report would have held out a real prospect of providing a lead on evidence which may have been relevant to an issue in the case."

[23] His Honour, Justice Steytler, again outlines at some significant length, firstly, "It has long been recognised that it is fundamental to our criminal justice system that no person should be convicted of a crime otherwise and then after a fair trial according to law [I omit the cases referred to by his Honour at paragraph 194] … and fairness requires that the Crown should disclose to the defence all material available to it that is relevant or possible relevant to an issue in the case." [I omit the relevant references].

[24] His Honour went on to state at paragraph 199, "In considering whether or not the duty of disclosure has been breached, it is unnecessary to decide whether there was any fault on the part of the prosecution." And he concluded at paragraph 203 (relevantly) "The possibility may also be open that the unfairness following from a non-disclosure has so pervaded and effected the trial that it has ceased to be a fair trial according to law."

[25] His Honour then concludes at paragraph 371 that, "The evidence which might have been led as a consequence of the disclosure of the relevant missing document was of substantial importance. It would have resulted in the case being run differently for the appellants and the appellants had lost the opportunity, in essence, of a fair trial." And in the circumstances, his Honour, as did the Court as a whole, concluded that the conviction should be quashed and no fresh trial ordered.

[26] In the case before me, Mr McCarthy concedes that this is a case not of a failure by the prosecution to disclose relevant documents (and on any view of it, all of the documents referred to during the course of submissions are relevant), but, in fact, an impossibility that those documents should ever be disclosed. It is asserted by Mr Chowdhury and conceded by Mr McCarthy, as I understand it, that all possible efforts which could be made to locate these documents have been made. They have not been able to be disclosed. It is conceded that they can not ever be disclosed, and in those circumstances it follows, ipso facto, that the defendant, Shane Farmer, can never receive a fair trial in respect of these indictments.

[27] In those circumstances it truly is as Mr Chowdhury describes it, an exceptional case, and the exceptional remedy available to a Court in such an exceptional case is the granting of a permanent stay. Accordingly, I order that indictment 324 of 2006, the Queen and Shane Francis Farmer, counts of fraud as an employee to the value of $5,000 or more (count one), stealing as a servant (count two), and fraudulently altering a record (count three) be permanently stayed.