R v Katsambas, Meyers, Watkins & Garlacz Nos. Sccrm-97-82, Sccrm-97-86, Sccrm-97-96, Sccrm-97-129 Judgment No. 6384 Number of Pages 8 Criminal Law

[1997] SASC 6384

IN THE COURT OF CRIMINAL APPEAL OF SOUTH AUSTRALIA

COX, LANDER AND BLEBY JJ

CATCHWORDS:

Criminal law - appeal and new trial and inquiry after conviction

Appeal and new trial - appeal against sentence - appeal by convicted persons - applications to reduce sentence - heroin distribution network - four appellants involved to various degrees in running the network - more than just street dealers or couriers - consideration of appropriate sentences for performing various managerial functions in heroin distribution network. Controlled Substances Act 1984 s32; Summary Procedure Act 1921s104, referred to. R v Santalab (C.C.A., 20 July 1993, unreported) ; R v Meyer (C.C.A., 29 August 1997, unreported) ; R v Hogan (1991) 161 LSJS 494, applied. R v Mangelsdorf (1995) 66 SASR 60, discussed.

HEARING:

ADELAIDE, 15 September 1997 (hearing), 3 October 1997 (decision)

#DATE 3:10:1997

#ADD 7:10:1997

Appearances:

Appellant George Katsambas:

Counsel: Mr M S Weinberg QC, with him Mr M A Griffin

Solicitors: Caldicott & Co.

Appellant Jan Elizabeth Meyers:

Counsel: Mr M J Barnett

Solicitors: David Stokes & Associates

Appellant Mary Watkins:

Counsel: Mr C J Kourakis

Solicitors: Susan Abbott

Appellant Helen Joanne Catrina Garlacz:

Counsel: Mr W F Braithwaite

Solicitors: Jon Lister

Respondent R:

Counsel: Mr P J Rofe QC, with him Mr P F Muscat

Solicitors: DPP (SA)

Orders:

- Katsambas: The appeal should be dismissed.

- Garlacz and Meyers: The appeal in each case should be allowed for the purpose of substituting a sentence of seven years' imprisonment with a non-parole period of four years, with both sentence and non-parole period running from 11 February 1997.

- Watkins: The appeal should be dismissed.

COX J

On 14 March 1997 the four appellants were sentenced in the District Court to terms of imprisonment ranging from five years to twelve years. They, and seven other persons who were sentenced that day, were members of a heroin distribution network that was being operated in and around Adelaide in 1995. Others associated with the same network had been sentenced on earlier occasions. So it was a substantial undertaking.

The appellant Katsambas pleaded guilty to taking part in the sale of heroin: Controlled Substances Act, s32. He was given a sentence of twelve years' imprisonment with a non-parole period of six years. The appellant Garlacz and the appellant Meyers also pleaded guilty to taking part in the sale of heroin, and they were each sentenced to nine years' imprisonment with a non-parole period of four and a half years. The appellant Watkins pleaded guilty to a charge of selling heroin - also a breach of s32 - and her sentence was five years' imprisonment with a non-parole period of two years. There was a single offence charged in each case but it was agreed that it was representative of a course of conduct.

The police assembled a large body of evidence against these people over a period of several months. The Crown case relied upon numerous police observations of the appellants and other members of the network, statements from those in the network who were willing to talk to the police, and thousands of telephone interception records made between February and June 1995 with respect to the mobile telephones of Meyers, Watkins and Katsambas. The committal papers, on which the sentencing Judge was, of course, entitled to rely, support the Judge's conclusion that, of those sentenced on March 14, Katsambas was the most senior, with Meyers and Garlacz subordinate to him but higher in the network than the street dealers and also (he considered) the couriers.

The evidence does not show when this network was set up. It was obviously operating before the telephone interceptions began in February 1995 and it only stopped, at least as far as these people were concerned, when the police moved in about September 1995. The seven persons who were sentenced with the appellants on March 14 were street dealers or couriers and there are a good number of other such persons mentioned in the committal papers who also worked for the same organization. They were not all working at the same time. Most of them were heroin users themselves and many would take their payment from the organization in kind. People would drop out - they might be arrested, or they might be found to have "taxed" the packets as they passed through their hands or to have sold outside the organization or to have been otherwise unsatisfactory - and others would be recruited to take their place.

The witness statement of Serena Beale gives some indication of how the network operated at the retail end. She was a heroin user and became a customer of the appellant Garlacz who gave Beale her telephone number. She would buy small packets (tastes) of heroin from Garlacz for $50 each. She would telephone when she needed some and Garlacz or Garlacz's driver would deliver it to a pre-arranged meeting place. About March 1995 Garlacz told Beale that she needed new drivers. (A "driver" was not usually a chauffeur, but was the person with a car who actually sold and delivered heroin to the user.) Beale agreed to work for Garlacz as a means of supplying her own heroin needs. She spent a day with Garlacz driving around the metropolitan area and being introduced to twenty or thirty of Garlacz's customers. Towards the end of the day she and Garlacz went to a street near the Adelaide Airport where they picked up another batch of heroin (forty-four packets) from a courier. Thereafter Beale operated her own round. She had forty or fifty regular customers. She sold twenty to sixty packets a day, seven days a week. Every time she took delivery of another forty-four packet consignment she and her companion kept four packets for themselves, Garlacz got six packets and $100 cash, and she would pay the courier $1 600. She would make contact with the courier by pager, or occasionally by telephone, and the delivery point would be changed frequently. She saw three different couriers over a period of three months. In June 1995 her house was raided and she was arrested. She described Garlacz as a huge heroin user. If Beale had any problems about deliveries she would ring Garlacz to sort them out. Shortly before the police arrived on June 23 she had a phone call from Garlacz accusing her of trying to steal her customers. Garlacz told her that if it did not stop she would have her neck and legs broken. After her arrest Beale rang Garlacz and told her what had happened. Garlacz told her to keep her mouth shut or what she had said earlier would happen. About three weeks later a man telephoned Beale. He did not give his name. He just told her that she did not know anything and she was to keep her mouth shut. She was subjected to anonymous minor acts of harassment. Garlacz would contact her every couple of weeks to ask what was going on and whether the police had any new evidence. She said that she was keeping Joe informed as to what was happening. The evidence shows that by "Joe" she meant Katsambas.

A courier, one Ormsby, was arrested in September 1995. He was carrying $1 000 cash in a sock and the police found sixteen heroin packets and another $2 325 at his house. He said that he had been introduced to heroin five or six weeks earlier and became a user. Katsambas, whom he had known at school, gave him heroin for nothing at first but then said he would have to pay for any more. By that time he was addicted. Katsambas said Ormsby could earn the money as a courier and Ormsby agreed. He was given a pager and he started delivering to dealers including Garlacz and Watkins. When he made a delivery he would collect the money and hand over the heroin. He made six or seven deliveries, each of twenty-two tastes, each day and got paid $100 for each delivery, so he was earning at the rate of $600 to $700 a day. However, he took his payment in heroin. He said that he obtained his delivery supplies from one address and paid over the monies he received from the street dealers at another address. On the morning of his arrest Katsambas had called in to say that a fresh shipment of heroin had arrived and he was dropping off a new batch of heroin to Ormsby's supplier.

Watkins was arrested on September 28. She had $1 800 in her possession and was about to take delivery of a heroin consignment. She was a heroin user. She had been recruited by Meyers. She was herself a street dealer, but she admitted that she had just been introducing a new girl to her customers in a particular area and that she had shown recruits what to do on other occasions as well. She had never met the boss of the operation.

The evidence established that both Garlacz and Meyers sold heroin on the street, but they also recruited drivers who would take over their rounds. The two appellants would then perform a background role of keeping an eye on things and smoothing out any delivery or other problems. If a problem arose that they could not solve, they would report the matter to Katsambas. It was obviously an advantage to them to distance themselves as much as possible from the actual retail selling where the risks of violence from a customer and detection by the police were greatest.

Katsambas had nothing to say on his arrest. His counsel said that he was the communications person, a facilitator, that he was nowhere near the top of the chain, that he had tried to leave the organization but was beaten for his trouble and so continued, and that his plea of guilty showed his contrition. He was not a heroin user. He was twenty-two at the time of his arrest. His criminal record was fairly minor. The learned Judge sentenced Katsambas on the basis that he was the principal organizer of the group and the ultimate problem solver. He supervised the operation, saw that it worked smoothly and collected the money. He was referred to by some dealers and couriers as "the boss". He may not have sold heroin personally but that was not his job. In reckoning Katsambas's sentence the Judge started with a head sentence of fifteen years and then reduced that to twelve years to allow for his plea and his age and his character references. He fixed a non-parole period of six years.

Garlacz was about forty-two when she was arrested. She had a long but not continuous history of serious drug use, with convictions running back to 1974 including one in 1985 for possessing heroin for trade when she was imprisoned for three years and nine months. She was a heavy user at the time of this offence. She had personal difficulties in her life. She got into this network because she was short of money. The Judge treated her as being more than a street dealer. He described her as an assistant to the manager. She employed others to sell heroin and showed them how the job was to be done. Her involvement went on for months. He began in Garlacz's case with a head sentence of twelve years and reduced it to nine because of her early plea and personal factors. He set a non-parole period of four and a half years.

Meyers' role in the organization was much the same as Garlacz's. She, too, was a long term addict. She had had an unhappy family life. His Honour said that Meyers, like Garlacz, knew from personal experience what dreadful effects heroin use can have, but she sold to others, and organized others to sell, for her own profit. The Judge regarded her level of offending as being the same as Garlacz's. Her criminal record was not as bad - there were no serious drug convictions - but she had probably offended on this occasion for longer and more efficiently. He therefore sentenced her in the same way as he had sentenced Garlacz.

Watkins was thirty-five when she committed this offence. She had had a good education and became a New Zealand diving champion. However, she formed an association with a heroin user and that marked her downfall. She was recruited by Meyers and was involved in this network for about seven months. While she was an active street dealer, under Meyers' control, the Judge regarded her involvement as greater than that of the ordinary street dealers because she showed other street dealers how to do the job. At least three people received instruction from her. She had three cannabis convictions and another for stealing. She pleaded guilty. She had made an effort to get off heroin. She gave some assistance to the police on one occasion but she did not offer to give evidence for the Crown. The Judge compared her culpability with that of the other street dealers and also with Mr Mangelsdorf (66 SASR 60) who appears to have been one of the first members of this network to be sentenced. He regarded Watkins' involvement as longer and wider in nature than Mangelsdorf's and Mangelsdorf had no prior convictions. His Honour began with a head sentence for Watkins of eight years, but took off two years for the plea of guilty and other personal factors and a further year for the assistance to the police, making a head sentence of five years. He allowed for another six months for that assistance when he fixed a non-parole period of two years.

I should say that the learned Judge sentenced all the street dealers and couriers to four years' imprisonment, with a non-parole period of eighteen months - the same sentence as Mangelsdorf received from the Court of Criminal Appeal. His Honour had to deal with seven lots of sentencing submissions from defendants in this group, no doubt with each defendant claiming that his or her particular case deserved favourable differential treatment. Understandably he resisted what he called fine tuning in the hope of obtaining a degree of uniformity and consistency. He acknowledged a difficulty in achieving absolute equality of approach and result where comparatively low non-parole periods were involved. In the end, as I say, he gave all seven the same sentence. The circumstances in Mangelsdorf's case were truly exceptional and the sentence fixed by the Court of Criminal Appeal was intended to reflect that. While I sympathize with the learned Judge's difficulty - and one of the problems in this kind of case is assessing a particular defendant's precise degree and duration of involvement - I do think that some of the defendants in this group were fortunate, particularly with respect to their non-parole periods. Eighteen months is a generous non-parole period for a crime that warrants four years' imprisonment. Perhaps the couriers were also fortunate in being treated in the same way as the street dealers. The relative culpability of a courier, compared with a street dealer, will depend on the circumstances of the case. The couriers here were supplying the dealers, not the retail customers. They were an important link in the chain and Ormsby's account shows that they were handling large quantities of heroin and large sums of money - much more than any street dealer. There is a question whether in those circumstances their culpability was not greater. Those issues do not fall for decision here. I mention them only because the learned Judge made it plain that he took R v Mangelsdorf as the starting point for all of the sentences that he imposed on March 14.

For the typical small scale retailer of heroin, the sentencing process generally begins at about six years. See Mangelsdorf and R v Santalab (CCA, 20 July 1993) and R v Meyer (CCA, 29 August 1997). That will accommodate the common type of case in which an actual sale or attempted sale is proved and the dealer is found with some packets or a substantial amount of money or both in his possession. If the evidence goes further and it is shown that the dealer was running a thriving business over a lengthy period of time, the starting point may well be higher. If, as in the case of Meyer, the evidence proves directly or indirectly no more than an isolated transaction, the starting point will be lower. There can be no rule of thumb penalty to cover all street trading offences regardless of their nature although, as the learned Judge correctly observed, excessive refinement and differentiation are to be avoided. I conclude that he treated these seven street dealers and couriers as relatively minor offenders.

All counsel in the appeals put forward a disparity argument, challenging the trial Judge's views on relative seriousness according to a person's position on the distribution chain and complaining also about the different percentage allowances for personal factors and the different percentage non-parole periods in the case of all of the March 14 defendants. I have referred to the head sentence and non-parole period that were applied uniformly to all street dealers and couriers, and this in itself causes a difficulty with the other sentences. I reject the submission that the same percentage discount and the same proportionate non-parole period must be applied throughout the range - with serious crimes, in particular, the non-parole period as well as the head sentence must reflect the gravity of the crime - but if a percentage disparity is too great a co-offender may be left with a justifiable sense of grievance.

I turn to Katsambas's appeal. His main complaints are that the learned sentencing Judge, evidently relying on the case of R v Hogan (1991) 161 LSJS
494, took too high a starting point, that his sentence is out of kilter with the sentences passed on Garlacz and Meyers, and that insufficient weight has been given to his youth and remorse and rehabilitation prospects.

It was Crown counsel who referred to Hogan. What the Judge did was put a lot of weight on Katsambas's position in this particular local network. There is no reason to think that he was an importer of heroin, but where he otherwise stood in the distribution chain seems to me to be a matter of conjecture. He may have been an entrepreneur, buying in bulk and distributing through his own network, or he may (as he claims) have been the salaried employee of someone else. The Judge noted the submission of counsel that Katsambas was being paid $700 a week. It may have been so - part-time and tax free, that is not an insignificant sum - but I observe that $700 is no more than one of his couriers (Ormsby) claimed he could earn in a day. I should prefer to conclude simply that, whether proprietor or servant, Katsambas must have been getting a reward of one kind or another in this lucrative industry that was commensurate with the responsibility of his position and the risk he took. The important thing is that he was the person in charge of the network. Keeping this mobile and changing and largely heroin-addicted staff functioning efficiently would have required considerable organizational and managerial skill. Katsambas was not a heroin user himself and he was vital to the network's success. His criminal culpability was to be judged accordingly. It may be acceptable - unavoidable, probably - to have heroin addicts on the staff at the lower levels of an organization such as this but someone more reliable and more endurable will obviously be needed at the senior managerial level. It is therefore important, as plainly the learned Judge considered, that the courts impose penalties that will make able people such as Katsambas, tempted by the large rewards, think twice before moving into any managerial position in the heroin trade.

If Ormsby's figures are accurate - and I cannot think of any reason why he would overstate his involvement - one courier in this network was distributing each week heroin with a street value of $46 000 or more. That extrapolates to $1.38m. for the equivalent of a full-time courier for the thirty weeks from the time the phone taps began until Katsambas was arrested. It is not clear how many couriers were employed at a time. I appreciate that Ormsby's answers to the police are hearsay as against Katsambas. That cannot be said about Beale and the other staff members whose committal statements, made and declared in accordance with s104 of the Summary Procedure Act, were on the court file for Katsambas to challenge in the witness box if he chose to do so. Beale said she was taking delivery of twenty to sixty packets a day. At that rate one street dealer would, in a thirty week period, take delivery of heroin worth between $210 000 and $630 000. Again, we do not know how many street dealers the network employed and for what periods and understandably the learned sentencing Judge did not make any detailed findings on the subject. It is clear, however, from the number of persons convicted and the committal statements generally, that this was a substantial heroin business.

The evidence does not establish that money or heroin normally passed through Katsambas's hands. Usually that would indicate a lesser degree of responsibility but not, I think, in this case. The network was carefully organized in a way that divided functions to an uncommonly fine degree. Probably that increased the efficiency of the operation and lessened the risk of detection or rip off. The evidence also shows that Katsambas intervened whenever any of the staff had a problem. His general oversight and his seniority in all respects were amply proved.

Mr Weinberg QC for Katsambas submitted that, with a maximum penalty of twenty-five years' imprisonment for this offence - I leave aside the fine -, the Judge's starting point of fifteen years left insufficient room for the bigger operators. I do not accept that submission. Where the dealing is in a prescribed amount of heroin (0.3 kg) or more the maximum sentence is life imprisonment, and where the quantity involved in any particular breach does not reach that level but the offending is on an exceptionally large scale or continues for a long time, the situation may have to be met by the laying of multiple charges. In the present case the penalty for Katsambas's single offence had to be assessed against a background of innumerable instances of like offences over a period of several months.

In my opinion the learned Judge's starting point of fifteen years fell within the compass of his discretion.

Katsambas was entitled to a discount for his early plea of guilty. The case against him was very strong but a trial would have been long and costly. As the Judge said, he was not entitled to be sentenced as a first offender. He had convictions for illegal use and a building break when he was eighteen and a couple of minor cannabis offences, although there was nothing approaching this order of seriousness. He put in a large number of character references but their impact was blunted by the multitude of heroin offences that spanned a period of many months. Then there was his age. He was only twenty-two at the time. There was nothing impetuous about his criminal behaviour here and he showed an uncommon maturity for his years in running this organization and handling his subordinates, but he was still entitled to some allowance for his youth. The appellant claimed to be remorseful, although his remorse did not extend to the identification of his own supplier. I have said that identically proportioned mitigation discounts cannot be expected for all offenders and at all levels. Katsambas's discount of three years was certainly not generous but I do not think it makes the sentence manifestly excessive or that he may justifiably complain on disparity grounds. The non-parole period of six years was quite moderate. In my opinion Katsambas's appeal should be dismissed.

The appeals by Garlacz and Meyers can be dealt with briefly. They were retailers themselves and also the supervisors of other retailers, with a significant role as organizers and recruiters and trouble shooters at the retail level. Although Garlacz had some serious drug convictions, Meyers had also been using heroin for years. The Judge was not obliged to give them different sentences. However, I consider that he took too high a starting point. As I have indicated, I think that any movement up the drug distribution line, involving more responsibility, deserves a significantly sharper penalty. However, these two women were close to the retail end of the network with an authority and responsibility very much less than Katsambas's, although their recruiting function was an aggravating factor. I would start in each case with a sentence of ten years and reduce it by three for the plea of guilty and other personal factors, making a head sentence of seven years. I would fix a non-parole period of four years. The appeals of Garlacz and Meyers should be allowed for the purpose of making those adjustments.

That leaves the appeal of Mary Watkins. She was basically a street dealer but the evidence shows that she an active member of the network from February 1995 to September 1995 when she was arrested - a longer period than any of the other dealers. The learned Judge took a serious view of her assuming responsibility for the training of a number of dealers, but he gave her a special discount for having given the police some assistance. The submissions made on her behalf made much of a percentage comparison between the discount and non-parole period she received and those given to the ordinary street traders. As the learned Judge said, it is difficult to achieve absolute equality of approach and result at these lower levels. I would not interfere with Watkins's sentence on that account. Perhaps a starting point of eight years was a little high in the circumstances, but the learned Judge was generous in making a deduction for her limited police assistance from the non-parole period as well as the head sentence. The assistance was qualified by an absence of any offer to give evidence for the Crown. In my opinion it has not been shown that Watkins's sentence was manifestly excessive.

Orders

I would make the following orders -

- Katsambas: The appeal should be dismissed.

- Garlacz and Meyers: The appeal in each case should be allowed for the purpose of substituting a sentence of seven years' imprisonment with a non-parole period of four years, with both sentence and non-parole period running from 11 February 1997.

- Watkins: The appeal should be dismissed.

LANDER J

I agree with the orders proposed by Cox J in each of the appeals and his reasons for those orders.

BLEBY J

I agree with the orders proposed by Cox J in each case and with the reasons that he gives.