R v Flavall
[2006] VSCA 32
•22 February 2006
SUPREME COURT OF VICTORIA
COURT OF APPEAL
No. 229 of 2005
| THE QUEEN |
| v. |
| GREGORY BRIAN FLAVALL |
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JUDGES: | CHERNOV and EAMES, JJ.A. and MANDIE, A.J.A. | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 22 February 2006 | |
DATE OF JUDGMENT: | 22 February 2006 | |
MEDIUM NEUTRAL CITATION: | [2006] VSCA 32 | |
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Criminal Law – Sentence – Multiple counts of theft – Obtaining property by deception – Fraud by investment adviser – 1.3 million dollars misappropriated between 1988 and 1992 – Flight – Arrest in 2005 in transit through Australia – Ill health of spouse residing in USA – Cumulation – Whether order for cumulation arbitrary – Sentence of 4 ½ years’ imprisonment with a non parole period of 3 years not manifestly excessive.
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| APPEARANCES: | Counsel | Solicitors |
| For the Crown | Mr O.P. Holdenson, Q.C. | Mr S. Carisbrooke, Acting Solicitor for Public Prosecutions |
| For the Appellant | Mr M.J. Croucher | Michael J. Gleeson and Associates |
CHERNOV, J.A.:
The appellant, who is now aged 46 and had no prior convictions, was sentenced, on 4 August 2005, by a judge of the County Court to a total effective sentence of four years, six months' imprisonment, having pleaded guilty, on 29 April 2005, to 23 counts of theft and one count of obtaining property by deception between June 1988 and January 1992. Many of the counts were rolled up counts. The maximum custodial penalty for each of the offences of theft and obtaining financial advantage by deception is ten years. The individual sentences are set out in the Table that is annexed to these reasons. The learned sentencing judge imposed a minimum term of 3 years’ imprisonment before the appellant was eligible for release on parole. As to cumulation, his Honour considered that approximately one third of each sentence, other than that imposed on count 1, be cumulated on that count.[1] I note for completeness that, when it came to expressing orders for cumulation, his Honour cumulated the individual sentences in different terms, but that aspect of his Honour’s cumulation order has not been challenged. On 18 November 2005, this Court granted the appellant leave to appeal against the sentence pursuant to s.582 of the Crimes Act 1958. The sentence is challenged on a number of grounds to which I will refer later, but at the outset, it is necessary to set out briefly the essential circumstances of the offending, which are fully described in his Honour's sentencing remarks and the Crown's summary of evidence.
[1]Given that the sentence imposed on count 1 was six months’ imprisonment, such a cumulation order would be contrary to what was said in R. v. MDB [2003] VSCA 181 at [14] and R. v. JG [2005] VSCA 74 at [22].
In about 1985, the appellant established a business that was concerned mainly with the sale of insurance products. Over a period of about two years, the business expanded its services to include superannuation and other investment advice and products. The appellant later became an agent for Superline Australia Ltd, which enabled him to deal directly with trustees of superannuation funds. In this capacity, he approached various clients, received instructions from them for the investment of their money in pooled funds and dealt with the various application forms associated with such investments. Typically, the clients gave the appellant specific instructions as to the investment direction of their respective funds, often after receiving advice from him. He was aware that his relevant licences, which permitted him to deal in securities and give financial advice, did not permit him to receive the investment moneys directly from clients; they authorised him only to process the applications and pass on any moneys to the relevant insurance or superannuation companies.
On 38 occasions between 1988 and 1992 the appellant fraudulently deposited clients' funds into his company's account and issued them with false documentation showing that their money had been invested in accordance with their instructions. He later lied to them by telling them from time to time that their funds were generating the expected income. The appellant thereby misappropriated, from 12 clients, over $1.3 million. Many of the victims were middle-aged or older who had sought safe investments for their savings. All but five of them eventually recovered some or all of the moneys from their bankers with the result that those banks also became effective victims. Importantly, however, they went through a terrible personal ordeal after the fraud was discovered and it appeared that they would lose their savings, and this experience continues to affect them detrimentally.
In 1992, when the victims of the appellant's fraud were pressing for their money and it was apparent that his fraud would be exposed, he left Australia, plainly in order to avoid being dealt with for his fraudulent conduct. The appellant eventually settled in the United States. A police investigation began not long after he left the country. Initially, the police did not know of the appellant's whereabouts, but by 1995 they had obtained his address and, it seems, a decision was made not to seek his extradition to Australia, although the basis of that decision was not made clear to the learned sentencing judge (or to this Court). The police designated the appellant as "a person of interest" for the purpose of apprehending him should he return to Australia. Eventually, in early 2005, the appellant did come to Australia, although his presence here was confined to being in the transit lounge in Sydney on route to New Zealand. In that context, on 28 February 2005, he was apprehended on his return from New Zealand and, when interviewed by the police on 17 March 2005, acknowledged his fraudulent conduct.
The appellant's personal circumstances are set out in his Honour's sentencing reasons and in the report of Dr Kennedy, a psychologist, that was tendered in evidence during the hearing of the plea in mitigation, and there is no need to re-state them here. It is sufficient to note that in the 1990s, after coming to live in the United States, the appellant married his present wife. He later became a citizen of the United States, having renounced his Australian citizenship, and eventually established a successful construction company in that country. The appellant's wife, however, is in poor health, suffering from a chronic liver disease that will probably require a liver transplant. Prior to his arrest, the appellant was her primary carer.
I now turn to the grounds of appeal that were argued. The appellant's first attack on the sentence was constituted by the claim that his Honour erred in his approach to cumulation and totality. More particularly, it was said that his Honour's decision that approximately one third of the sentences be cumulated on the base count bespoke sentencing error because it indicated that his Honour had decided the period of cumulation arbitrarily contrary to the approach required by authorities such as Mill v. The Queen[2], DPP v. Grabovac[3] and R. v. Coukoulis[4].
[2](1988) 166 C.L.R. 59 at 63-64.
[3][1998] 1 V.R. 664 at 676-681.
[4](2003) 7 V.R. 45 at 57.
Those cases make it plain that, where the offender is to be sentenced on numerous counts, once appropriate individual sentences have been imposed, the primary concern of the sentencing judge is to ensure that the total effective sentence accords with the principle of totality and is not crushing. The proper approach to be adopted in order to achieve that end is, where practicable, to impose individual sentences that reflect the offending and other relevant matters, and then to make appropriate orders for cumulation or concurrency.[5] These authorities also make it plain that this is the preferred course but not the only way in which a proper total effective sentence may be achieved. As Ormiston, J.A. said in Grabovac[6], such a rule is only a “precept or guideline to be applied as and when practicable”. A like view was taken by the majority of the High Court in Johnson v. R.[7] where their Honours emphasised, amongst other matters, that “[j]udges of first instance should be allowed as much flexibility in sentencing as is consonant with consistency of approach and as accords with the [applicable] statutory regime”.
[5]See Mill at 62-63, Grabovac at 676 and 680, and Coukoulis at 57.
[6]At 655.
[7](2004) 205 A.L.R. 346 at 351-352 and 356 per Gummow, Callinan and Heydon, JJ.
In terms of the application of the principles as to cumulation, again, the need to adapt them to the particular situation was made apparent by Ormiston, J.A. in Grabovac[8] where his Honour said:
“The ordinary principles as to cumulation require that the sentencing judge should as far as practicable identify separate events, “episodes”, or “transactions” giving rise to specific counts or groups of counts and to recognise them by ordering at least a degree of cumulation. … Difficulty arises not so much in providing for a degree of cumulation, but in having proper regard to the principle of totality and in avoiding the imposition of an inappropriately crushing sentence.”
And that such an approach to cumulation will lead to some arbitrariness in the determination of the relevant periods was also recognised by Ormiston, J.A. in Coukoulis where his Honour noted[9] that such an approach necessarily leads to some “ad hoc reasoning and arbitrary conclusions”.
[8]At 676.
[9]At 57.
In my view, the sentencing error for which the appellant contends has not been made out. The cumulation orders were not arbitrary in the sense that there was failure by the judge to give proper consideration to what should be the appropriate periods of cumulation in respect of the corresponding sentences. It seems to me that his Honour approached this aspect of the sentencing task in accordance with the principles to which I have referred. Thus, the learned judge first imposed an appropriate sentence in respect of each of the 24 counts.[10] His Honour then sought to produce an appropriate total effective sentence by making the impugned cumulation order. It is true that, on one view, it would have been preferable had his Honour identified groups of counts or offences, as suggested by Ormiston, J.A. in Grabovac as I have mentioned earlier, and then ordered cumulation by reference to such groupings. If his Honour had adopted that course, it may have been more apparent that he had given consideration, as between the groups of counts, to the appropriate periods that should be cumulated. But I consider that it is plain enough that his Honour effectively did just that. The learned sentencing judge obviously concluded that, in broad terms, a greater period should be cumulated from the more serious offences than the lesser ones, although, as between the counts within each group, the period of cumulation would be the same. As is apparent from the Table, the sentences vary in length, depending on the seriousness of the offence, from one month to the maximum of 18 months, and his Honour’s formula produced different periods of cumulation in respect of different groups of sentences. That his Honour’s approach involved some degree of arbitrariness is unsurprising and, as I have said, by itself did not constitute sentencing error as was recognised in Coukoulis and, by inference, in the other cases to which I have referred.
[10]The appropriateness of such sentences was not challenged by the appellant.
In the circumstances, I consider that this ground should fail.
I would also reject the appellant's next ground, namely, that his Honour erred in converting the value of the funds into current dollar value. Under cover of that complaint, it was first said that the process adopted by his Honour for converting the value of the funds was speculative. In my view, however, it is plain that his Honour used a reliable source - the Reserve Bank - for obtaining the relevant conversion figures. In any event, it is plain that the conversion was undertaken only to obtain a broad understanding of the relevant difference in the value of funds stolen. Secondly, it was asserted that sentencing practices have changed between the date of the offence and the date of sentence so that it could not properly be said that the penalty for an offence measured in today's dollars should be the same as the penalty for stealing the equivalent value in yesteryears' dollars. Importantly, however, his Honour did not seek to place himself in the position of a sentencing judge at the time of the offence. I also note that it has not been demonstrated that the sentencing practices with respect to offending of this nature have changed over the period in question, and moreover the appellant's then counsel did not contend for such a change in practice during the hearing of the plea in mitigation. In any event, the conversion of the value of the stolen amount to its current monetary terms merely enabled the court to have a better understanding, at the date of sentence, of the gravity of the offence committed a decade or so ago and the impact of the crime on the victims.
Finally, it was submitted for the appellant that the sentence, including the non-parole period, is manifestly excessive and that the learned sentencing judge failed to give sufficient weight to a number of identified mitigating factors. It is convenient to dispose first of the last complaint. I consider that there is nothing on the face of his Honour's sentencing remarks that indicates that there was failure by the judge to accord those mitigating factors due weight. I also consider that the alleged error cannot be inferred from the sentence given that, as I have noted and as I explain briefly below, I do not consider that it is excessive as claimed by the appellant.
The offences to which the appellant pleaded guilty are serious offences, each of which attracts, as I have noted, a maximum custodial sentence of 10 years. The appellant’s offending conduct was also grave, given that it involved large sums of money, deceit of people who relied on him and gross breaches of trust. The victim impact statements make plain the extent of deceit that he practised on them and the devastating effect that this had, and continues to have, on them financially and personally. It would have been obvious to him that they would experience at least significant financial loss and great personal distress by reason of his fraudulent conduct. Moreover, the principles of general deterrence, denunciation of the offending conduct by the court and the imposition of just punishment assumed considerable importance in the sentencing disposition.
It is true that many mitigating factors operated in favour of the appellant. They included the early plea of guilty, following an early admission, his remorse, his seemingly lawful life in the United States, the hardship that he will have to bear whilst in gaol given that his sick wife lives in the United States, the fact that he has no family or friends in Melbourne, and the long period of delay between when the appellant was "located" by the police and the disposition of the matter. His Honour took all these and other relevant matters personal to the appellant into account in the sentencing disposition, and, contrary to the appellant's contention, was entitled to assess the relevant value of his plea of guilty in the context of his having fled the jurisdiction in order to avoid the consequences of his fraud.
Mr Croucher emphasised that this was an unusual case calling for the exercise of mercy, particularly since incarceration will work hardship not only on the appellant but also on his sick wife. But I consider that his Honour took that fact into account when sentencing the appellant, and I can see no error in the exercise of his Honour’s discretion, which means that this Court has no power to interfere with it. In the circumstances, I consider that the sentence is within relevant range.
Mr Croucher has said all that could be said for the appellant, but, for the above reasons, I consider that the appeal should be dismissed.
EAMES, J.A.:
For the reasons given by Chernov, J.A., I agree that none of the grounds of appeal is made out in this case.
I add only this, as to the complaint that the sentence was manifestly excessive. The impact of these offences on the unfortunate victims is powerfully reflected in the many victim impact statements filed on the plea. Many of the victims in the case were elderly by the time of the plea, some in their eighties. In evidence given to the judge, the informant in the case, after noting that some of the victims were in their eighties, added this:
"But Your Honour, if I can just add, I have had some dealings, I have seen all of the victims about this, and the time that I have spent with all the victims has actually been quite distressing, to see how affected and how upset they have been by what occurred to them many, many years ago. They have not let it go, and it has affected - the majority of them have indicated to me that it has affected their lives and they're in a situation, many of them, where they felt that they couldn't recover from it, and subsequently they haven't."
In my opinion, this appeal should be dismissed.
MANDIE, A.J.A.:
I agree with Chernov, J.A. and I also subscribe to what has been said by Eames, J.A.
CHERNOV, J.A.:
The order of the Court is that the appeal is dismissed.
TABLE
Count[11] Particulars Head sentence 1 21/6/1988 -30/6/1988 Chqs $45,000 6 months 2 13/10/1988 -
16/12/1988Chqs $78,000 10 months 3 15/12/1988 $8000 2 months 4 17/2/1989 Chq $20,000 3 months 5 12/5/1989 –
30/6/1989Chqs $152,000 15 months 6 26/5/1989 Chq $25,200.75 4 months 7 26/5/1989 Chq $7,067.49 2 months 8 26/5/1989 Chq $4,430.37 1 month 9 5/7/1989 Chq $34,141.34 5 months 10 2/1/1990 Chq $80,000 10 months 11 2/7/1990 Chq $1,000 1 month 12 5/7/1990 Chq $2000 1 month 13 12/7/1990 Chq $25,000 3 months 14 18/7/1990 Chq $32,500 4 months 15 5/10/1990 Chq $150,000 15 months 16 8/10/1990 -
11/10/1990Chqs $22,493.08 3 months 17 16/11/1990 Chq $150,000 15 months 18 OPD 4/12/1990 Chq $32,417.31 5 months 19 27/6/1991 Chq $1000 1 month 20 30/7/1991 -
15/8/1991
Chqs $77,020 10 months 21 7/8/1991 Chqs $72,500 9 months 22 12/9/1991 -
14/10/1991
Chqs $216,470.87 18 months 23 9/1/1992 Chq $27,247.04 4 months 24 10/1/1992 $40,000 5 months [11]All counts are for the offence of theft, except for count 18, marked “OPD”, for obtaining property by deception.
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