R v Pollock
[2010] WASC 164
•2 JULY 2010
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CRIMINAL
CITATION: R -v- POLLOCK [2010] WASC 164
CORAM: JENKINS J
HEARD: 2127 & 31 MAY & 12 JUNE 2010
DELIVERED : 2 JUNE 2010
PUBLISHED : 2 JULY 2010
FILE NO/S: INS 101 of 2009
BETWEEN: THE QUEEN
Prosecution
AND
JAMIE KEVIN POLLOCK
Defence
Catchwords:
Criminal law and procedure - Trial by judge and jury - Charge of defrauding the Commonwealth - Elements of offence - Submission that accused has no case to answer - Crown's evidence taken at its highest not capable of establishing guilt
Legislation:
Crimes Act 1914 (Cth), s 29D
Criminal Procedure Act 2004 (WA), s 108
Result:
The accused has no case to answer
Category: B
Representation:
Counsel:
Prosecution : Mr D G Staehli SC & Mr A E Eyers
Defence: Mr D Grace QC & Mr E Fitzpatrick
Solicitors:
Prosecution : Director of Public Prosecutions (Cth)
Defence: Edward Fitzpatrick
Case(s) referred to in judgment(s):
The Queen v Hillier [2007] HCA 13; (2007) 228 CLR 618
The State of Western Australia v Montani [2007] WASC 110
The State of Western Australia v Montani [2007] WASCA 259; (2007) 182 A Crim R 155
JENKINS J: Jamie Kevin Pollock (the accused) was charged that between about 30 November 1999 and 28 July 2000 at Perth he defrauded the Commonwealth, by dishonestly causing the underpayment of tax instalment deductions, contrary to the Crimes Act 1914 (Cth), s 29D. To this charge he pleaded not guilty. His trial commenced on 21 May 2010 before myself and a jury. At the end of the prosecution case, the accused submitted that he had no case to answer. I upheld that submission and, pursuant to the Criminal Procedure Act 2004 (WA) s 108, acquitted the accused of the offence. I discharged the jury without it delivering a verdict. I said that I would publish my reasons at a later date. These are my reasons.
Legal principles
In The State ofWestern Australia v Montani [2007] WASCA 259; (2007) 182 A Crim R 155, the Court of Appeal approved McKechnie J's summary in The State ofWestern Australia v Montani [2007] WASC 110 of the legal principles that apply to a no case to answer submission. I quote from his Honour's judgment but omit some portions which are not required to understand the undisputed legal principles:
The principle is to be extracted from the judgment in Morrison at 489 ‑ 490:
'… where a no case to answer submission is made by an accused in reply to a prosecution case, the trial judge is required to ask whether the evidence of the Crown taken at its highest is capable of establishing beyond a reasonable doubt the guilt of the accused.'
Morrison v Kiwi Electrix adopted, with approval, the test stated by King CJ in R v Bilick & Starke (1984) 36 SASR 321 at 337:
'The same test is to be applied to deciding a submission of no case to answer in a case depending upon circumstantial evidence as in a case depending upon direct evidence, although the manner of its application will be different. The question to be answered by the trial judge is whether there is evidence with respect to every element of the offence charged which, if accepted, could prove that element beyond reasonable doubt ... Where the case is a circumstantial or partly circumstantial case and therefore depends on inferences, the question may be expanded so that it becomes: On the assumption that all the evidence of primary fact considered at its strongest from the point of view of the case for the prosecution, is accurate, and on the further assumption that all inferences most favourable to the prosecution which are reasonably open, are drawn, is the evidence capable of producing in the mind of a reasonable person satisfaction beyond reasonable doubt, of the guilt of the accused?'
The question of circumstantial evidence has received recent attention by the High Court in The Queen v Hillier [2007] HCA 13; (2007) 233 ALR 634 particularly from [46] to [48]:
'46 The case against Mr Hillier was a circumstantial case. It has often been said that a jury cannot be satisfied beyond reasonable doubt on circumstantial evidence unless no other explanation than guilt is reasonably compatible with the circumstances. It is of critical importance to recognise, however, that in considering a circumstantial case, all of the circumstances established by the evidence are to be considered and weighed in deciding whether there is an inference consistent with innocence reasonably open on the evidence.
…
48Often enough, in a circumstantial case, there will be evidence of matters which, looked at in isolation from other evidence, would yield an inference compatible with the innocence of the accused. But neither at trial, nor on appeal, is a circumstantial case to be considered piecemeal. As Gibbs CJ and Mason J said in Chamberlain [No 2]:
''At the end of the trial the jury must consider all the evidence, and in doing so they may find that one piece of evidence resolves their doubts as to another. For example, the jury, considering the evidence of one witness by itself, may doubt whether it is truthful, but other evidence may provide corroboration, and when the jury considers the evidence as a whole they may decide that the witness should be believed. Again, the quality of evidence of identification may be poor, but other evidence may support its correctness; in such a case the jury should not be told to look at the evidence of each witness 'separately in, so to speak, a hermetically sealed compartment'; they should consider the accumulation of the evidence: cf Weeder v The Queen.
Similarly, in a case depending on circumstantial evidence, the jury should not reject one circumstance because, considered alone, no inference of guilt can be drawn from it. It is well established that the jury must consider 'the weight which is to be given to the united force of all the circumstances put together': per Lord Cairns, in Belhaven and Stenton Peerage, cited in Reg v Van Beelen; and see Thomas v The Queen and cases there cited."'
…
The focus of enquiry is the capability of the evidence producing satisfaction beyond reasonable doubt. It is important to recognise the role of the jury as fact-finders in criminal trials. A Judge is not a finder of fact on a no case submission. A Judge assumes that all the evidence of primary facts is accurate. A Judge does not assess the quality of evidence: Doney v The Queen (1990) 171 CLR 207 where the High Court said at 214:
'…if there is evidence (even if tenuous or inherently weak or vague) which can be taken into account by the jury in its deliberations and that evidence is capable of supporting a verdict of guilty, the matter must be left to the jury for its decision. Or, to put the matter in more usual terms, a verdict of not guilty may be directed only if there is a defect in the evidence such that, taken at its highest, it will not sustain a verdict of guilty.'
…
'Speculation' is relevantly defined by the Macquarie Dictionary as '4. conjectural consideration of a matter; conjecture or surmise'. 'Conjecture' is '3. the formation or expression of an opinion without sufficient evidence for proof to conclude or suppose from grounds or evidence insufficient to ensure reliability.'
A jury cannot speculate. It is confined to matters of evidence and rational conclusions from the evidence.
In Peacock v The King (1911) 13 CLR 619 Barton J said at 651:
'Whether the fact, or that body of facts which is called the "case" is capable of bearing a particular inference, is for the Court, and unless it is so capable, the Court's duty is to withhold it from the jury, as a single fact or as a case. But when the case is undoubtedly capable of the inference of guilt, albeit some other inference or theory be possible, it is for the jury, properly directed, and for them alone, to say not merely whether it carries a strong probability of guilt, but whether the inference exists actually and clearly, and so completely overcomes all other inferences or hypotheses, as to leave no reasonable doubt of guilt in their minds.'
Distilling the principles derived from the cases I have cited, a Judge's role when considering if there is a case to answer is to assume the existence of all facts upon which there is evidence. The Judge then draws all reasonable inferences from those facts adverse to the accused and in favour of the prosecution. If, having undertaken the exercise, the inference of guilt is reasonably capable of being drawn to a standard beyond reasonable doubt, it is the duty of the Judge to allow the case to proceed.
If a reasonable inference of guilt cannot be drawn because there is a defect in the evidence preventing the drawing of a reasonable inference of guilt to the criminal standard of proof, it is the duty of the Judge to find the accused not guilty.
In the drawing of an inference, only reasoned and logical deductions are permissible; speculation and conjecture are not.
It is sometimes said that a no case to answer submission in a circumstantial evidence case is very difficult to make good because the drawing of inferences, including the ultimate inference of guilt, is pre‑eminently a jury be established. First, there must be facts capable of being established from which an inference may be drawn. Secondly, the facts must support, either singly or in combination, a logical inference, not a guess or a speculation. It is sometimes difficult to identify precisely the difference between a rational inference and a speculation but there is a difference. The difference is acute in the present case to which I now turn [3] ‑ [17].
I have included a portion of his Honour's reasons which quotes from The Queen v Hillier [2007] HCA 13; (2007) 228 CLR 618. Although the quote does not directly relate to the test for the determination of a no case submission, it is a helpful reminder of the need to consider the effect of the accumulation of the evidence in a circumstantial or partly circumstantial case when deciding whether there is a case to answer.
The elements of the offence
At the relevant time the Crimes Act s 29D stated:
A person who defrauds the Commonwealth or a public authority under the Commonwealth is guilty of an indictable offence.
Having regard to the facts of this case it was common ground that in order to prove the charge the Crown had to prove the following matters beyond reasonable doubt:
1.That, during the charged period, the accused prejudiced the Commonwealth's rights in relation to recovery of 'pay as you earn' (PAYE) tax instalments deducted from employees wages during the charged period (the PAYE deductions). The relevant employees were employees of Interwest Investments Pty Ltd (Interwest), NCH Hydraulic System Australia Pty Ltd (NCH), Greenrush Pty Ltd (Greenrush), Express Plant Pty Ltd (Express), Canaan Goldfields Joint Venture Pty Ltd (Canaan) and WNE Constructions Pty Ltd (WNE). These companies were known collectively as the Goldfields companies which operated as part of the larger Pollock group of companies (the Pollock group);
2.That the accused's acts and omissions which prejudiced the Commonwealth's rights to recovery of the PAYE deductions were dishonest by the standards of ordinary honest people; and
3.That the accused knew that what he did was dishonest by those standards.
Prior to trial, the Crown suggested to the court that the accused's liability was as a consequence of his participation in a joint criminal enterprise. However, the case was not opened to the jury on that basis and during submissions on the no case application, the prosecutor said that the Crown relied on the accused's own acts and omissions to establish his criminal liability, assessed against the background of the evidence which proved that the accused's father, Kevin Pollock, and the Pollock group's in‑house accountant, Stuart Baldock, were involved in a scheme before and during the charged period by which the Commonwealth was defrauded of the PAYE deductions of the employees of the Goldfields companies.
The accused did not dispute the Crown's assertion that as a matter of law, at the relevant times, the Goldfields companies were employers and were required to register with the Australian Tax Office (ATO) as group employers. They were also required to remit to the ATO the PAYE deductions that had been deducted by the companies from their employees' wages each week (the PAYE remittances). The PAYE remittances had to be made once a month. Neither was it disputed that at the end of each financial year each company was required by law to provide a reconciliation statement to the ATO stating the total PAYE deductions for the year, as well as the total amount remitted by the company for that year. Those concessions relieve me of the necessity to detail the provisions of the Commonwealth tax laws which created those obligations.
It was accepted that in order to prove the charge, the Crown had to establish that during the charged period the accused knew of the scheme that his father and Mr Baldock were operating and that he knowingly participated in it. A failure to make the PAYE remittances, if accompanied by the necessary dishonesty, constituted participation in the offence.
The Crown case
I will outline the prosecution case as opened by senior counsel for the Crown. Of course, the mere fact that the Crown case failed to establish the matters asserted in the prosecutor's opening did not mean that the accused did not have a case to answer. However, it is easiest to assess the sufficiency of the Crown case within the framework of what the prosecutor told the jury that the Crown would seek to prove.
The Crown prosecutor said in opening:
So the essence in that outline of the allegation here is that in respect of a series of companies with which [the accused] was involved, as were his father and Stuart Baldock, money said to be tax deductions was taken from the wages of the employees of the series of companies according to what would normally happen in such businesses and one of two things happened.
In relation to one of the companies, a company called Interwest Pty Ltd, which was registered as a group employer … tax instalment deductions were taken from the wages of the employees but it wasn't all paid to the Tax Office. Within Interwest there were three separate payrolls…
… And although deductions were made from each of the employees and each of those three payrolls, only deductions approximately equal to one of those payrolls were remitted to the Tax Office.
The other two sets of deductions made from the employees of the other two payrolls were not remitted to the Tax Office. Each of the three payrolls related to a particular part of the business and had a different name called Goldfields in each case; Goldfields Administration, Goldfields Operators and Goldfields Workshop.
Each month when the part remittance was supposed to be made to the Tax Office, a slip filled in by someone at the relevant company was meant to be … sent to the Tax Office at the time that the amount due was paid with the money for that amount due filled in on the slip. Our case is that that amount was filled in falsely; that is, incorrectly and falsely to the knowledge of the people who were filling it in, and that was false because the amount which was written in that little square told a story only about one of those three payrolls.
It wasn't necessarily a third of the amount involved but it told the truth only in a partial way and was therefore false, in that it only told the Tax Office about a certain amount which had been deducted from the three payrolls of Interwest. And in each case that was much less than the amount which had actually been deducted by the company and which was retained by the company in its accounts - or in its bank accounts because it wasn't sent on to the Tax Office.
…
And our case is that in respect of some of those slips which were completed at the time that the monthly payments of instalment deductions were made that [the accused] himself filled in some of those slips and there will be other evidence about information which was given to the Tax Office in respect of those monthly remittances.
In relation to another four companies with which this case is principally concerned which I will call NCH, Express Plant, Keenan (sic) Goldfields Joint Venture and WNE Constructions, ...
Deductions were made from the employees of each of those companies … but no money at all in the form of those tax deductions from those companies was remitted to the Tax Office.
…
These non‑payments, on the prosecution case, were part of the overall dishonest scheme to keep from the Tax Office the information which would have permitted it to exercise those rights to recover the deductions which had been made from the employees of those entities and those underpayments and non‑payments were intended to mislead the Tax Office into not chasing up the entities to get the money to which it was entitled in that way.
So as I've said, the allegation is that [the accused] knew that this scheme was happening and participated in what was happening and I'll give you some more information about - or more precision about that later on, but if that is proved, that is, that he knew about and participated in what was going on, with the requisite knowledge that it was going on, he was thereby a part of that scheme and if that is proved beyond a reasonable doubt, as it's required to be in a criminal case like this, he would be guilty of the offence charged.
There were other features as to what went on, including the revision of payroll records at the end of each year to conceal the true numbers of employees of Interwest and the other companies that I've mentioned and the wages payments which have been made to those employees.
… there was a revision of the payroll records so that the group certificates or statements of earnings would in fact be issued by some other company.
So that when the employees presumably sent those group certificates into the Tax Office the Tax Office would be thrown off whatever scent it might wish to follow in relation to the pursuit of the tax instalment deductions which had not been made.
… the company that was used … to issue group certificates for employees who had worked for other companies in the year ending 30 June 2000 … the company that was used for that purpose was … Express Plant Pty Ltd and in respect of that particular company, as it turns out, [the accused] happened to be a director of that company and signed a number of those group certificates at the time.
…
So for the first two years which this scheme operated, which are the years ending 30 June 1998 and 30 June 1999, there was in fact another company which acted like Interwest insofar as it partly remitted in the way that I've described.
…
But the effect of what I said is that for the first two years of the three financial years that our case alleges that there was this scheme operating, there were two companies which were under‑remitting and four companies which were not remitting at all. In the case of the financial year with which we are concerned, particularly the year ending 30 June 2000, there was one company which was partly remitting, Interwest and four companies which were not remitting at all.
…
The companies whose names I've mentioned, … were part of what was called or will be called in the case the Pollock Group. They were a group of companies controlled not by [the accused], the accused in this case, but by his father, Kevin. They were essentially under the control of him, even though, by and large, Kevin Pollock was not a director of the companies with which we are concerned. The directors of the companies were other family members, his brothers, his son, his daughter and the like.
As I've mentioned, Mr Pollock and Stuart Baldock, who worked at the Pollock Group during the time with which the case is concerned … the two of them operated this scheme which was in place for most of the two preceding financial years, those ending 30 June 1998 and 30 June 1999, during which time the tax instalment deductions were withheld in the way that I have mentioned.
We expect that Mr Baldock will give evidence in this trial later in the week. … . Initially he was employed as general manager of part of the Pollock Group that was involved in the processing and selling of soils and other landscaping materials at the time that Mr Baldock came on board.
But in about early 1997 Mr Kevin Pollock acquired another business called Goldfields Contractors WA, which was essentially a fleet of excavators and earthmovers and other heavy equipment. Previously; that is, in its previous form, the Pollock Group had operated an office at 665 Welshpool Road, Welshpool. The offices of Goldfields were at a different place, 25 Jackson Street, Bayswater.
According to Mr Baldock, although Kevin Pollock's brother Peter Pollock was listed as a director of the company that operated the Goldfields Contractors business which had been acquired in that way that I've mentioned, Peter Pollock was a director of Interwest, which was the company which operated the Goldfields Contractors business at the Pollock Group.
Despite that, it was Kevin not Peter Pollock who administered and was in charge of the financial affairs of the whole Pollock Group, including the Goldfields Contractors WA part of the business. And it is with that Goldfields part which was acquired in 1997 that this case is concerned.
Now, the payroll records for those three payrolls that I mentioned for Goldfields were created at that Jackson Street, Bayswater office, created like many payroll records are from timesheets which were completed by the employees, the workers for those businesses. Then each week the information from those timesheets were collated into payroll records and then that was in a documentary and electronic form sent to Mr Baldock initially at the Welshpool Road office, back at what we might call head office.
He would then report to Mr Pollock; that is, Mr Baldock would, about the salary payments to employees which would be due on the basis of those payroll records and those payments would ultimately be made…
And those payments were made through the National Australia Bank and through, relevantly to our period anyway, through an electronic system which permitted the company to punch in records or to deliver a disk, an electronic disk containing the details of the employees and the amounts which were due to them so that payments could be made of the salaries which were due to them, less the amount of tax which had been deducted from their wages. And that, of course, left those tax deductions, which were, you know, a decent proportion of the wages of every person, which had been taken from their salaries by the company.
And Mr Baldock would talk to Mr Pollock in a way which he will describe to you, about what, if any, payments would be made in relation to those deductions which had been made from the employees to the Tax Office. So each week and then monthly Mr Baldock would speak to Mr Kevin Pollock.
And in the early years, the first two in particular with which we are concerned, he would get Mr Kevin Pollock, whose authority was necessary for these things, to tell him how much, if at all, of those tax instalment deductions were to be remitted to the Tax Office.
After … those Goldfields payrolls had come on board … another payroll was set up for a company which I'll call shortly WNE. This payroll was also set up and run at the Goldfields office at 25 Jackson Street, Bayswater.
After the three payrolls that I've mentioned for Goldfields under Interwest had been set up, later on WNE, that further company, went into liquidation, and Mr Baldock was told by Mr Kevin Pollock to set up a company payroll under the name of WNE Constructions. That was done. But the PAYE or group instalment, the tax instalment deductions from the employees, the wages of WNE were never reported to the ATO. … and the company was never registered with the Tax Office as a group employer. Mr Pollock had said to Mr Baldock at the time, 'There's no need for a new registration for WNE'.
And then after that, over a period of time other payrolls were set up at the Goldfields office, including those under the names of the companies I've already mentioned; Express Plant, Keenan (sic) Goldfields Joint Venture and Goldfields Contracting Kalgoorlie, and NCH Hydraulic Systems. All those payrolls were set up on the instructions of Kevin Pollock. And the employees who were working out of that office, being a range of employees, were divided up amongst those four payrolls.
As I've said, there were - there are obligations which arise out of people working for an entity or a person. And amongst them, again many of you would be familiar with this, is the obligation for an employee when he or she starts work at a place to sign a PAYE declaration, I'll call it, being a form in which the employee identifies that he's working for the employer at that place. And that's stored by the Tax Office with the records of the relevant employee so as to permit, if it happened, comparison with group certificate records and so as to entitle that employee to get the benefit of tax rights which are applicable to salary that he or she is being paid. If there isn't a proper declaration, then the employee is liable to have tax deducted at a higher rate.
It's intended, and it's meant to be the case, that such employee declarations are sent to the Tax Office in the way that I've mentioned. But in the case of some of those employees I've mentioned in relation to those companies who were working out of the Goldfields office at Jackson Street, those declarations were held back by the company and not sent into the Tax Office. That was another part of the things which went on so as to cause the Tax Office to not know about these employees.
…
And when on occasions the Tax Office did ring up to ask why it was that a company which was not paying group tax - why it was that it was not paying group tax, Mr Baldock on some occasions either spoke to and/or wrote to the Tax Office saying, 'This company doesn't have any employees. We set it up but it's not being used'. That, of course, was a lie. But it was enough to fob off the Tax Office from further pursuit of those particular entities.
So I've mentioned that the payroll information would come across from the Goldfields Bayswater office to the Welshpool Road head office of the Pollock Group. And during the financial years ending 30 June 1998 and 1999 and 2000 and up until the time that he, Mr Baldock, left the Pollock Group at the end of October 1999 as a full‑time employee, he would prepare a weekly wage spreadsheet or a summary document from the payroll information that came across from the Goldfields payrolls at Bayswater Road.
… And they showed the true position about what had happened; that is, they showed the wages which had been paid to the employees, they showed the tax which had been deducted, and they showed various other pieces of information as well. Mr Baldock would accumulate that information into a spreadsheet using the computers at Welshpool Road, and he would use that as the basis for his discussion with Mr Pollock of the kind that I've mentioned
He'd got to Mr Pollock and say, 'Here's the wages to be paid'. And at the end of each month when the companies were - or should have been required to send in their tax instalment deductions, he'd discuss with Mr Pollock what Mr Pollock, Kevin Pollock, would want done in respect of that payment or non‑payment of tax instalment deductions. And you'll see some of these documents in front of you and you'll see, according to Mr Baldock, some notes which Mr Pollock made on some of them from time to time confirming the things which - or the payments which were to be made or not made.
So I've really just been describing in a general way the internal operations of the scheme which the prosecution says was operating. After Mr Kevin Pollock had identified what payments should be made, then Mr Baldock, certainly in the early period and up until the time that he left, would be responsible most of the time for the remitting to the Tax Office which was actually done; the understated remitting which was done in respect of Interwest and the other company, which is less relevant for our period.
…
In relation to those meetings which I said Mr Baldock had with Mr Kevin Pollock on a regular basis, either weekly and a monthly one in relation to the amount of tax which was to be underpaid or not paid, Mr Baldock, who was aware, hence him having pleaded guilty and been convicted of this, of what was going on, will tell you that he told Mr Kevin Pollock that what they were doing was Canning Vale Prison stuff, that being his shorthand way of saying to Mr Pollock and reminding Mr Pollock that what was being done was illegal.
We expect that Mr Baldock will say that on occasions, the repeated occasions that he said this sort of thing to Mr Kevin Pollock, that [the accused], the accused in this case, was present during those conversations between the two men and was in a position to hear the discussion between the two men which included that statement.
That was because [the accused] during most of the period which I've been mentioning, that is, from 1997 through to 2000, was in fact working at the Pollock Group, working as an employee, in effect, of his father, and carrying out various procedural roles, we might call them by way of a general description, in relation to the business of the Pollock Group.
Now, it is the case that while Mr Baldock was there he was principally responsible for the preparation of the payments which were to be made to the Tax Office, but it's our case that during the period of time that [the accused] graduated, if you like, from being a young man working part‑time in his father's office to a person who had significant financial responsibilities, that during that time Mr Baldock showed [the accused] the ropes, if you like.
That meant that if he showed him how the payroll system operated and showed him how the spreadsheet system operated, and on our case [the accused] became aware through the things which Mr Baldock showed him, not only how the payroll system operated in its legitimate sense, that is, in terms of paying employees, but how it operated in the sense that the tax instalment deductions, the identification of which was on these spreadsheets which were prepared on a weekly basis, came to his notice.
So when he came to be involved in payments which were made to the Tax Office he, on our case, must have been aware that the payments which were being made in respect of Interwest, a company which did deduct and did partially but under‑remit, he, [the accused], must have known that those underpayments were going on.
… The other thing that Mr Baldock did was to keep a separate group of spreadsheets on a computer system which had a heading or description called ATO Advised. …
… these ATO Advised spreadsheets, which were kept by Mr Baldock in which he kept a record of what the Tax Office had actually been told about the payments that had been made.
…
So this was a system which was operated by Mr Baldock up to and including the time that he left full‑time employment with the Pollock Group which coincides with the start of the charge period which [the accused] faced, that is, early November 1999.
But the system, that is the ATO Advised spreadsheet system, continued to operate even though Mr Baldock was not there on a full‑time basis, involved in these discussions with Mr Kevin Pollock about payrolls and the payment of group tax.
Amongst other things that would happen during this period, by the way, is that when there were five pay days in a month, on one of those days in which the pay day fell on 1st of the month and the 2nd of the month and the month was long enough to permit five days rather than four in any individual month, from time to time Kevin Pollock would tell Mr Baldock in respect of the remittances which were being made to the Tax Office for Interwest not to pay the fifth … the fifth week ...
…
As against [the accused] himself, of course, I need to identify to you the essence of the case against him. Most of what I've been telling you is, I'm sure you would have recognised, about a general scheme or a general picture of what was going on.
When [the accused] started work at his father's business he apparently did courier work and banking and other tasks at the direction of his father. However, on our case, by the time the period covered by the charge came around he was working at the Pollock Group full‑time and on Mr Baldock's version of events, as we understand what he will say, [the accused] became responsible for cash management across the Pollock Group generally and for drawing and signing cheques and doing bank transactions as, it is conceded, instructed by his father.
When Mr Baldock was there, he says that [the accused] would report to his father each day on the cashflow position of the various companies and on our case, it's inconceivable that in those circumstances [the accused] did not know about the circumstances of the underpayment of the taxation obligations and likewise it's inconceivable that he was not actually involved in those underpayments and non‑payments.
… In relation to Mr Baldock's weekly reporting of the position of the companies, if Kevin Pollock was not present, Mr Baldock would ask [the accused] about what should be done. And as he understood it, [the accused] would attempt to find his father, Kevin, to ask him about which payments should be made of the kind that I've mentioned.
Mr Baldock, as I've already said, showed [the accused] how the payroll functions worked, including the requirements and the mechanisms to deduct group tax from the wages of the employees. He instructed [the accused] how to prepare the spreadsheets for the Goldfields payroll which showed the true position and the information for which, which would have come across from the Welshpool Road - to Welshpool Road from the Bayswater office, as I've mentioned.
He did instruct [the accused] about needing Kevin Pollock to identify what was to happen in relation to the payments that would be made as a result of those spreadsheets being discussed with Kevin Pollock. So when Mr Baldock was here full‑time he would complete those remittance slips that would go in with the payments, such as were made, by Interwest to the Tax Office, and then he would give those slips, Mr Baldock would say, to [the accused] to draw the cheques necessary for payment to the Tax Office.
So on our case, as I've already said, it's inconceivable in those circumstances that [the accused] would have drawn those cheques or been involved in that process without knowing what it was that was going on. There'll some other evidence about details of [the accused]'s involvement, the particulars of which I do not need to give you at the moment.
So in summary, in relation to that involvement of [the accused] which I've mentioned, concerning the period of the charge with which we are principally concerned and particularly concerned in relation to the question of [the accused]'s guilt or lack of guilt in this case, it's alleged that by the time that Mr Baldock left full‑time employment at around the end of October 1999 that [the accused] knew the details of the system which his father and Mr Baldock had set up.
And evidence from Mr Baldock and others will be called which will satisfy you that he not only knew about it, but participated in that scheme in the ways that I've mentioned and thus committed the crime which is alleged against him. To do that requires the prosecution to prove, amongst other things, what [the accused]'s state of mind was. There won't be, I don't expect there will be direct evidence in the prosecution case about [the accused]'s state of mind.
You'll know or be able to infer both from what Mr Baldock says and what you know now about the conviction of him and [the accused]'s father Kevin Pollock that they have in effect admitted that they had the intention to defraud the Commonwealth in the way that I have described. And Mr Baldock will tell you what he knew about such matters in relation to himself.
But there's no such evidence - of course, we're here to determine whether or not [the accused] is guilty or not - there'll be no such evidence that he admitted to anyone that he knew what was happening in relation to the payment of tax instalment deductions, or in relation to the alleged fraud itself. There will be no one saying, '[the accused] told me that he knew that we were underpaying tax' in the way it is alleged in this case. Rather, the case will be about drawing inferences, or making deductions from the evidence which you will hear.
Immediately after the prosecutor's opening, defence counsel opened the accused's case. He said that the accused accepted that there had been underpayment of PAYE remittances but that the accused did not accept that he had caused that underpayment. His position was that he had no knowledge of the underpayment at the time and that he had not acted dishonestly.
It is seen from the prosecutor's opening that the Crown sought to prove that the accused participated in the scheme to defraud the Commonwealth by proving a number of facts from which it said the jury could infer that the accused knew about the scheme operated by his father and Mr Baldock, participated in the scheme and did so with the requisite dishonesty.
In summary, the material matters alleged by the prosecutor in opening were as follows:
1.Interwest underpaid the ATO by only sending PAYE remittances for one of its three payrolls. The accused completed some of the remittance slips.
2.During the charged period, the other four Goldfields companies did not send any PAYE remittances.
3.At the end of the 1999/2000 financial year (the 2000 financial year) there was a revision of the payroll records to conceal the true numbers of the employees of Interwest and the other Goldfields companies. Earning statements (previously known as group certificates) were issued by a company in the Pollock group other than the company which, in truth, employed the relevant employees.
4.Express was used to issue earning statements for employees who had worked for other Goldfields companies in the 2000 financial year.
5.The accused was a director of Express and signed a number of the false earning statements.
6.The Goldfields companies were controlled, not by the accused, but by his father, Kevin Pollock. The payroll for the Goldfields companies was prepared at the Bayswater offices of those companies. The payroll was not prepared by the accused, who worked at the Welshpool offices of the Pollock group.
7.For the two or so years prior to Mr Baldock leaving his full‑time employment at the Pollock group at the end of October 1999, he would:
(a)prepare a weekly wage spreadsheet or a summary document from the Goldfields companies' payroll information, using the stand‑alone payroll computer at the Welshpool Road offices of the Pollock group;
(b)use the spreadsheet as a basis for his discussions with Mr Kevin Pollock;
(c)at the end of each month when the Goldfields companies were due to send their PAYE remittances, discuss with Mr Kevin Pollock the payments which Mr Pollock did or did not want remitted to the ATO;
(d)after Mr Kevin Pollock had determined the payments which were to be made and had told him of those figures, remit those amounts to the ATO;
(e)complete the remittance slips that would go with the payments to the ATO and give the slips to the accused to draw the cheques necessary for payment to the ATO;
(f)if Mr Kevin Pollock was not present, ask the accused what should be done about the PAYE remittances. The accused would attempt to find his father to ask him which remittances should be made to the ATO.
8.The amounts which by Mr Kevin Pollock decided to pay in PAYE remittances did not reflect the full PAYE tax liability of Interwest. They did not include any of the PAYE remittance obligations of the other Goldfields companies.
9.During the meetings between Mr Baldock and Mr Kevin Pollock, Mr Baldock told Mr Kevin Pollock that what they were doing was 'Canning Vale Prison stuff'. This was Mr Baldock's shorthand way of telling Mr Kevin Pollock that what they were doing was illegal.
10.The accused was occasionally present during these meetings between Mr Baldock and Mr Kevin Pollock. He was in a position to overhear the conversation. These conversations occurred prior to the charged period.
11.During most of the period from 1997 through to the end of the charged period the accused was working at the Pollock group in the Welshpool office and carrying out various jobs.
12.During this period of time the accused graduated from being a young man working part‑time in his father's office to a person who had significant financial responsibilities within his father's business.
13.During the period of time Mr Baldock was employed by the Pollock group he showed the accused 'the ropes'. He showed him how the payroll system operated, including how the spreadsheet system operated and the mechanism for deducting group tax from the employee's wages. He instructed the accused how to prepare the spreadsheets for the Goldfields companies' payrolls which showed 'the true position'.
14.Through these instructions, the accused became aware not only of how the payroll system operated in its legitimate sense but also how the system of underpayment and non‑payment of PAYE remittances operated.
15.Mr Baldock instructed the accused that Mr Kevin Pollock identified the PAYE remittances to the ATO, 'as a result of those spreadsheets being discussed with Mr Kevin Pollock'. By the time that Mr Baldock left full‑time employment at around the end of October 1999, the accused knew the details of the system which his father and Mr Baldock had set up.
16.When the accused came to be involved in the PAYE remittances to the tax office he must have been aware that the payments that were being made in respect of Interwest were underpayments.
17.Mr Baldock prepared a separate group of spreadsheets entitled 'ATO advised'. These spreadsheets contained the amount of the PAYE deductions for each company which the ATO had been advised.
18.The ATO spreadsheets continued to be prepared after Mr Baldock left the Pollock group.
19.During the charged period, the accused was working full‑time at the Pollock group. He was responsible for cash management across the Pollock group, for drawing and signing cheques and doing bank transactions as instructed by his father.
20.It is inconceivable that in all the above circumstances when he signed cheques for PAYE remittances and performed similar tasks that the accused did not know about the underpayment of the tax obligations and that he was not actually involved in those underpayments and non‑payments.
The Crown's case taken at its highest
There was an abundance of evidence to prove that up until the end of November 1999, which was when the evidence (as opposed to what the Crown alleged in its opening) proved that Mr Baldock left full‑time employment with the Pollock group (ts 519, 656), he and Mr Kevin Pollock operated, what was called during the course of the trial, 'the scheme' to defraud the Commonwealth of a substantial amount of the Goldfields companies' PAYE remittances. The scheme has been described adequately already. Thus, the Crown case taken at its highest established par 1 – 9 above (with the exception of par 7(f)).
In respect to those matters which were said by the Crown to show the involvement of the accused in the scheme and his knowledge of its illegality, I make the following comments:
1.There was evidence from which the jury could conclude that during the charged period the accused had completed, in his own handwriting, some of the remittance slips sent to the ATO with underpayments of PAYE remittances by Interwest (ts 491 ‑ 492). There was similarly evidence from which the jury could have concluded that the accused had maintained a record of those payments in the pre‑printed booklet supplied by the ATO for that purpose. The record was a one line entry for each month which identified the name of the relevant month, the date of the remittance and the amount of the remittance (ts 491 ‑ 493).
2.There was evidence that before Mr Baldock left full‑time employment he told the accused that at least some of the Goldfields companies' employee declarations were held at the Welshpool offices on the instructions of Mr Kevin Pollock (ts 571). Mr Baldock could not say whether or not he had told the accused that this was inappropriate (ts 572). The accused had been asked to and had signed some of the declarations for Express employees (ts 569).
3.There was no evidence that the accused's duties within the Pollock group went beyond the physical acts of making those remittances and keeping that record. That is, there was no evidence that the duties of the accused extended to making decisions as to what money should be paid or even to speaking with his father about what amounts should or should not be paid.
4.There was evidence that Mr Baldock, with some assistance from the new payroll officer, Mr Beer, created the 2000 financial year earning statements for the employees of the Goldfields companies (ts 640, 650) and that he left them with Mr Kevin Pollock to be signed (ts 564, 631). There was no evidence that the accused was involved in the creation of those documents (ts 564), a number of which were false because they were issued by a company which did not, in truth, employ the relevant employee.
5.There was evidence that Mr Baldock was instructed by Mr Kevin Pollock to use the company, Express, to issue 2000 earning statements which were false (ts 555, 559, 588). The accused signed some of those earning statements (ts 562, 563). The accused was the director of Express (ts 561).
6.The only evidence about how the accused came to sign those earning statements was to the effect that in previous years after the statements were created there was a rush to have them issued to employees by the required date and that a director of the relevant company or whoever was available to sign them was asked to do so. Mr Baldock then arranged for them to be sent to the employees (ts 561, 564, 603).
7.The only evidence before the jury as to how the accused came to be a director of Express was that Mr Kevin Pollock would decide whether he needed another company as a vehicle for his businesses. He would tell a member of his family that they were to be a director of a new company and they would be told to sign the relevant document to become a director (ts 565, 569, 602, 603).
8.As to the accused's knowledge of the corporations law, the only evidence before the jury was that in Mr Baldock's opinion, the accused did not know the 'obligations and financial status' of the company or companies he directed and neither did he have the 'requisite knowledge' of his duties and responsibilities of a director of a company (ts 607, 608). Another accountant, Mr Anthony Paul Hawkins, who worked at the Pollock group in late 1999 until January 2000 on the introduction of GST, had a similar opinion (ts 408).
9.The only evidence before the jury as to how the Goldfields companies and other companies in the Pollock group were controlled was that they were controlled by Mr Kevin Pollock and that nothing happened in the companies without his knowledge or unless it was at his direction (ts 545, 555, 558).
10.There was evidence before the jury that up until the end of November 1999, Mr Baldock compiled the monthly spreadsheet showing the amount of tax which had been deducted from the payroll of each Goldfields company during the course of that month (ts 523 ‑ 524). He also completed the 'ATO advised' spreadsheet which also showed the true amount of the PAYE deductions for each of the Goldfields companies, except for Interwest (ts 529, 557). In the case of Interwest it only showed the amount of the tax deducted from one of the three Interwest payrolls. Thus, it was only in respect to Interwest that the 'ATO advised' spreadsheet contained information about what the ATO had been advised. Mr Baldock gave evidence that the 'ATO advised' spreadsheet showed the PAYE remittances for each of the companies (ts 549) but this was not borne out by the spreadsheets themselves.
11.There was evidence before the jury that up until the end of November 1999, Mr Baldock took the monthly summary report or spreadsheet to Mr Kevin Pollock for the purpose of receiving instructions from Mr Kevin Pollock as to how much of the PAYE deductions were to be remitted to the ATO (ts 528, 600). After the amount had been determined by Mr Kevin Pollock, whoever had the cheque book would write the cheque and Mr Kevin Pollock would sign it (ts 604). Whoever was available would deposit it (ts 535).
12.There was evidence before the jury that Mr Baldock was of the opinion that there would have been occasions from 1997 through to November 1999 when he met with Mr Kevin Pollock for this purpose and the accused was also present (ts 544, 545, 600). In cross‑examination it was put to him that his evidence at its highest was that perhaps the accused was present and perhaps he was not present during the monthly meetings (ts 602). Mr Baldock agreed with that summation. However, the evidence taken at its highest in examination‑in‑chief was that Mr Baldock believed that the accused would have been present during some of those meetings from 1997 through to the end of November 1999.
13.There was evidence that the accused was present at a meeting on 28 October 1999 between Mr Baldock and Mr Hawkins where Mr Baldock described the accused's duties at the Pollock group as including the payroll, writing cheques and bank reconciliations (ts 400). However, in re‑examination of Mr Hawkins the Crown elicited from Mr Hawkins that it was represented to him that the accused was a bookkeeper, did bank reconciliations, cheque payments, cash balances, hire purchase journal balances and payments to creditors (ts 416). The Crown relied upon this as an implied admission by the accused that these were his roles.
14.There was evidence that after Mr Baldock gave his notice, he taught the accused the payroll system so far as it operated for the non‑Goldfields companies within the Pollock group (ts 534, 547, 549). The reason why his instructions did not include the Goldfields companies was because their payroll was compiled at the Bayswater offices of those companies by another officer (ts 523). Only the completed payroll information would be sent to Mr Baldock for authorisation and for payment (ts 370 ‑ 371). Mr Baldock and the accused worked at the Welshpool office of the Pollock group (ts 369).
15.Mr Baldock's evidence was that he did not know whether he had taught the accused how to prepare a spreadsheet. Neither did he recall any discussions with him about PAYE deductions or 'PAYE', in general (ts 534). Mr Baldock did not give evidence that he instructed the accused how to prepare the spreadsheets for the Goldfields companies' payrolls which showed 'the true position'. By the time he left the full‑time employment of the Pollock group at the end of November 1999, Mr Baldock believed that the accused had only a limited capacity to prepare a spreadsheet (ts 593). He thought that the accused could prepare a payroll from time sheets (ts 593). He could not say that the accused was aware of the spreadsheets containing the summaries of payroll, although they were part of the payroll function (ts 546).
16.There was evidence that during Mr Baldock's last two weeks of full‑time employment he trained a new payroll officer, Mr Arthur Beer (ts 670). Mr Baldock said that after he left someone had to prepare a summary report of the payrolls and take it to Mr Kevin Pollock but he did not know who did that (ts 593).
17.Mr Beer was called by the Crown but during re‑examination he was declared a hostile witness (ts 773). After he was declared hostile he did not resile from any of his previous testimony.
18.Mr Beer said that from the time Mr Baldock left full‑time employment, he (Mr Beer) did the payroll for the non‑Goldfields companies in the Pollock group (ts 673). This was also Mr Baldock's evidence (ts 557). Mr Beer said that only he did the payroll and no one else 'touched' the payroll (ts 681, 699). He said that he was not responsible for PAYE remittances (ts 674). He said that he also received the completed payroll from the Bayswater office for the Goldfields companies (ts 673). This was contained on a floppy disk (ts 675). He said that he collated the payroll information onto a spreadsheet (ts 673). He also prepared a floppy disk containing all the payroll information (ts 674). He said that the only involvement that the accused or other staff had with the payroll was to give instructions to the bank for payment of wages to the staff (ts 675, 788). The bank required information contained on the floppy disk to enable it to transfer funds from Pollock group bank accounts to the employees' bank accounts (ts 524). However, there was no evidence that in the process of electronically delivering the information on the disk to the bank, the accused would have seen or noted the amount of tax deducted from an employee's wage, the total amount of tax deducted from a Goldfields company payroll or the total amount of tax deducted from all the Goldfields companies' payroll.
19.It was open to the jury to reject Mr Beer's evidence. If it had, the only evidence as to the accused's involvement in the payroll and the PAYE remittances during the charged period was his completion of some remittance slips and a keeping of the record of the remittances by Interwest, his instructions to the bank to transfer money from one bank account to another to enable the wages to be paid and the signing by him of some false earning statements after the close of the financial year.
20.There was no evidence that, during the charged period, the accused had anything to do with the preparation of the Goldfields companies' payrolls, that he had prepared any payroll summaries or spreadsheets, that he had access to the payroll summaries or spreadsheets or that he would speak to Mr Kevin Pollock about the amount of the PAYE remittances to be made to the ATO each month.
21.The 'ATO advised' spreadsheets did not disclose what the ATO was in fact advised by the Goldfields companies. The spreadsheets contained what Interwest had paid by way of PAYE remittances and recorded this as the total amount of PAYE deductions made from the Interwest payroll. The spreadsheets showed the correct total of PAYE deductions that were taken from the wages of the employees of the other Goldfields companies.
22.There was evidence that the 'ATO advised' spreadsheets were created for the months of December 1999 and January 2000, but not thereafter. Mr Baldock and Mr Beer each said that they did not complete the December 1999 and January 2000 spreadsheets (ts 557, 632, 680). The evidence was that Mr Kevin Pollock did not have a computer in his office and could not use a computer at that time (ts 660). The evidence was that the accused had a computer in his office (ts 663). However, the evidence was that Mr Baldock had created these documents on the stand alone payroll computer (ts 529, 548, 592, 663). Mr Baldock thought that the accused had access to that computer at the time he left (ts 548). During the charged period, the payroll computer was in Mr Beer's office (ts 679) and he said he was not aware of anyone else using it (ts 681, 699). It would have amounted to speculation for a jury to conclude that the accused completed the December 1999 and January 2000 spreadsheets.
23.There was evidence that during the charged period the accused was responsible for regularly advising his father of the balances in the bank accounts operated by the Pollock group and for signing cheques to pay creditors under the instructions of his father (ts 479, 545). For standard payments, officers in the accounts' department sighted the relevant invoice and completed a cheque requisition which would then be sent to the accused. On occasions, the accused wrote the cheques but more often they were written by officers in the accounts department and simply sent to the accused for signing (ts 479, 496, 502, 545). The accused also did the banking and general administrative duties (ts 546).
24.The evidence could support an inference that the accused had signed cheques for remittances to the ATO, just as he signed cheques to pay other creditors.
25.Mr Baldock said that up until he left full‑time employment at the end of November 1999, if he could not obtain instructions about the payroll that needed to be run from Mr Kevin Pollock, he would speak to the accused and the accused would try and find his father 'to get authority to do whatever had to be done with the payroll' (ts 534). Mr Baldock did not say that he ever received instructions from the accused in regards to payments or the payroll.
26.Mr Baldock did not say that he instructed the accused that after the payroll documents had been compiled he needed to discuss the spreadsheets with Mr Kevin Pollock and get him to identify the PAYE remittances to be made to the ATO. There was no evidence that the accused was ever told of that system. There was no direct evidence that by the time that Mr Baldock left full‑time employment with the Pollock group, the accused knew the details of the scheme which his father and Mr Baldock had set up.
Was the Crown case, taken at its highest, capable of proving the charge?
Although a circumstantial case must be considered as a whole, it is useful to consider separately the Crown case insofar as it related to the underpayment of Interwest PAYE remittances, the non‑payment of the Goldfields companies' (excluding Interwest and Express) PAYE remittances and the non‑payment of Express's PAYE remittances.
In order for the accused to be criminally liable in respect to prejudicing the Commonwealth's rights to Interwest PAYE remittances, there had to be evidence to sustain findings, not only that the accused physically made the PAYE remittances, but that he knew that the payments he was making were underpayments. The Crown did not suggest that the accused himself would have determined the amount of the PAYE remittances. Rather, it was asking the jury to infer that the accused knew of the underpayments from his knowledge of the amount of PAYE deductions, the amount of the PAYE remittances and his presence during earlier conversations between his father and Mr Baldock about earlier underpayment of PAYE remittances.
The Crown, in effect, conceded that in order to prove its case the evidence had to sustain a finding that the accused was privy to the figures on the weekly or monthly payroll summaries or spreadsheets. Senior counsel submitted:
STAEHLI, MR: The PAYE book.
JENKINS J: All right. Well that shows that he knew what was being remitted.
STAEHLI, MR: Yes.
JENKINS J: I'm talking now, what ‑ how do we know what he knew that the true position was in terms of the amounts deducted from the employee's wages?
STAEHLI, MR: Well, there's no direct evidence that he ‑ that is no one puts, for example, the monthly spreadsheet into his possession. That is the monthly spreadsheet of the kind which we're previously looking at. However, he had ‑ on our case, he had the capacity to access the existence of such records. He was, on the evidence of Mrs Kannemeyer, the person who was responsible for the payments of creditors. Cheques went through his hands. He had a connection with things which went on in the office, including the payroll. It's true that he wasn't, obviously, directly involved in the mechanical processes of paying the wages, but for the fact that Mr Baldock educated him in how to convert timesheets into payslips. But all that material was accessible to him, and so our case is that in the circumstances of the things which he was doing in the office, that material would have come to his notice (ts 863).
The suggestion in opening that if Mr Kevin Pollock was absent, the accused would be called on by Mr Baldock to make that decision or discuss the amounts with his father, was not made good by the evidence. Neither was the assertion in opening that Mr Baldock taught the accused how the spreadsheet system operated made good by the evidence.
There was no direct evidence that during the charged period the accused had access to the spreadsheets which contained the Interwest payroll, including information about the PAYE deductions. The evidence, from Mr Beer, was to the contrary. Even if Mr Beer's evidence had been rejected by the jury, there was no circumstantial evidence from which it could infer that the accused accessed the spreadsheets. The prosecutor's submission that the accused had a 'capacity to access' such documents, even if it had been proved, (which I do not think it was), would not be evidence capable of producing in the mind of a reasonable person satisfaction beyond reasonable doubt that the accused accessed the spreadsheets. Thus, there was a fatal deficiency in the Crown case so far as it related to the underpayment of Interwest's PAYE remittances.
The above deficiency in evidence affected proof of the charge in respect to all the Goldfields companies. Additionally, leaving aside Express, the accused had no legal obligations in respect to the Goldfields companies or their PAYE remittances. Neither was there any evidence that the accused had anything to do with their payrolls other than to direct the bank to transfer moneys between accounts in order for there to be money in the relevant account for payment of the wages and to provide a second authorisation to the bank for it to release funds to pay the wages. There was no evidence that in this process the accused saw the actual Goldfields companies' payrolls.
Unlike Interwest, no PAYE remittances were made to the ATO by the remaining Goldfields companies and so there was no paperwork that needed to be filled in, in respect to those companies. Once Kevin Pollock had decided not to remit any PAYE deductions to the ATO there was no other action to take. Given that the accused had no legal obligations in regard to the remittance of their tax and there was no evidence of any kind to prove that the accused discussed PAYE remittances of these companies with his father, there was insufficient evidence to prove that the accused had done anything or had failed to do anything to prejudice the Commonwealth's right to the monthly remittances in respect to NCH, Greenrush, Canaan or WNE.
Although the Crown did not open the case, or make submissions on the no case to answer application, on the following basis, it could be said that the accused's signing of earning statements for the 2000 financial year for some of the Goldfields companies' employees in the name of Express rather than in the name of the true employer, was evidence that the accused prejudiced the Commonwealth's rights. However, there was no evidence before the jury that the accused knew the workforce details of those companies so that he would have known that the statements which he signed were false.
Officers at Bayswater prepared the Goldfields companies' payrolls. Those companies operated out of Bayswater. The accused worked at Welshpool. There was no evidence that he was involved in the Goldfields companies' operations. Mr Beer received the Goldfields companies' payroll on a floppy disk. Mr Baldock prepared the earning statements. He knew they were false and knew why they had been falsely created. He did not testify that he told the accused, or indeed any other person other than perhaps Mr Kevin Pollock, of their falsity. The evidence was that earning statements were generally signed in a rush and, in colloquial terms, they were shoved under someone's nose for them to sign. In those circumstances, the evidence could not establish beyond reasonable doubt that the accused knew that by signing those statements he was prejudicing the rights of the Commonwealth by dishonestly causing the underpayment of tax instalment deductions.
In the usual course of events the Crown's position would have been somewhat stronger in the case of Express's non‑payment of PAYE remittances given that as a director of Express the accused could be said to have had a legal obligation to ensure that the company complied with its obligations to send the proper amount of the PAYE remittances to the ATO. I note that this was not ever expressly stated by the prosecutor, but I accept that it is the case for the purposes of the no case submission.
However, the Crown's case taken at its highest in this respect was that the accused was a director and he had signed some false earning statements for the charged period. Apart from that evidence, the Crown's evidence was that the accused did not know his obligations as a director, did not know of the company's financial obligations, did not control Express, did not prepare or have anything of note to do with the Express payroll and only became a director because Mr Kevin Pollock told him to sign the requisite form. During the charged period, the accused was a young man without any formal qualifications.
In my view, even if the fact that the accused was a director of Express is added to the mix of circumstantial evidence, the evidence was insufficient for a properly instructed jury to conclude that the accused knowingly omitted to make PAYE tax instalment deduction remittances to the ATO on behalf of Express and, even if he did so, that he did so dishonestly.
For these reasons, I concluded that there was not evidence in respect to every element of the charge which, if accepted, could prove those elements beyond a reasonable doubt and ruled that the accused had no case to answer on the charge. Even assuming the existence of all facts upon which there is evidence and drawing all reasonable inferences from those facts adverse to the accused and in favour of the prosecution, the inference of guilt was not reasonably capable of being drawn to a standard beyond reasonable doubt. This is because the evidence taken at its highest could not sustain findings that during the charged period the accused knew of the scheme that his father and Mr Baldock were continuing to operate and that he had access to, and did access, the spreadsheets which would have enabled him to know that underpayments and non payment of PAYE remittances were occurring. It was only if these matters were proved, that it could in turn have been proved that the accused knowingly and dishonestly caused the underpayment of PAYE remittances, thereby prejudicing the Commonwealth's rights in relation to recovery of PAYE deductions and defrauding the Commonwealth.
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