R v Reid - [2019] SADC 33

District Court of South Australia
(Criminal)
R v REID
[2019] SADC 33
Reasons for Ruling of His Honour Judge Tilmouth (ex tempore)
12 March 2019
CRIMINAL LAW - PROCEDURE - INFORMATION, INDICTMENT OR PRESENTMENT - JOINDER - JOINT OR SEPARATE TRIAL
CRIMINAL LAW - EVIDENCE - JUDICIAL DISCRETION TO ADMIT OR EXCLUDE EVIDENCE - EVIDENCE UNFAIR TO ADMIT OR IMPROPERLY OBTAINED - PARTICULAR CASES
The accused applies for the severance of 7 counts of deception from 57 counts of aggravated theft on the basis of improper joinder, inadmissibility of one group of offences in proof of the other group, and incurable prejudice.
Held: Dismissing the application.
1. The offences are properly joined as forming a series of offences of a similar character.
2. The respective groups of offences are properly cross-admissible to prove system, context, state of mind, motive, knowledge of a dishonest scheme, to rebut a defence of acting innocently or with authority and as rendering an innocent explanation circumstantially or coincidentally improbable.
3. The jury can be duly directed so as to avoid potential prejudice occasioned by the large number of counts and uncharged transactions.
Criminal Law Consolidation Act 1935 (SA) s5AA(i), s 130, s 134(1), s 139(a); Criminal Procedure Act 1921 (SA) s 102(1), s 102(5); Evidence Act 1929 (SA) s 34P(2), s 34P(2)(a), s 34P(2)(b), s 34P(3), s 34R(1); Sutton v The Queen (1984) 152 CLR 528; Kidman v The King (1915) 20 CLR 425; R v Kastratovic (1985) 42 SASR 59; Peters v The Queen (1998) 192 CLR 493; MacLeod v The Queen (2003) 214 CLR 230; R v Kerin (2013) 116 SASR 316; R v Phan (1990) 54 SASR 561; R v Gibbs (1992) 58 SASR 347; R v Mussolino (2003) 86 SASR 37; R v Phan (1990) 54 SASR 561; R v C,CN (2013) 117 SASR 64; Perarra-Cathcart v The Queen (2016) 260 CLR 595, referred to.
Finlayson v The King (1912) 14 CLR 675; Martin v Osborne (1936) 55 CLR 367; R v Phan (1990) 54 SASR 561; KRM v The Queen (2001) 206 CLR 221, applied.
R v Smart (1982) 6 A Crim R 192; R v Appleby (1996) 88 A Crim R 456; Walker v Kormez [2011] VSCA 160; R v MacFie [2012] VSCA 314, considered.

R v REID
[2019] SADC 33
Application for severance

Mr Reid is before the court facing trial on an Information charging him with 64 separate counts. Counts 1 - 7 inclusive charge deception contrary to s 139(a) of the Criminal Law Consolidation Act 1935 (SA) (CLCA), whereas the remaining counts charge aggravated thefts contrary to s 134(1) of the CLCA. The particulars of aggravation are that Mr Reid was in a ‘position of authority’ as a Director of a Corporation: s 5AA(i) CLCA.
This interlocutory motion for severance of the first seven counts from the remaining counts, is brought on the basis of improper joinder. Defence counsel contends they are ‘not founded on the same facts or form, or are part of, a series of offences of the same or a similar character’, as required by s 102(1) and (5) of the Criminal Procedure Act 1921 (SA). In the alternative, it is submitted that a presentment containing so many counts produces an incurable risk of prejudice justifying severance. A separate application for a stay was abandoned by the defence at the beginning of the hearing of the motion.
The charges
The first seven counts cover the period between 1 August and 20 September 2013. Mr Reid is alleged to have made misrepresentations to two Directors of a company as yet to be formed, in effect by persuading them to advance ‘start-up’ costs for the proposed business which he used instead for his own purposes. Counts 1, 3 and 6 – 7 alleged $186,870, was advanced to one future Director and counts 4 and 5 allege that $19,100 was advanced to the other Director on the same understanding.
The second batch comprising counts 8 – 64, relate to withdrawals from a bank account operated by the company incorporated as Civil Pipelines Australia Pty Ltd, in which Mr Reid was one of three Directors. The signatories to this account were the other two Directors as well as Mr Reid. These counts span the period from 6 November 2013 to 28 January 2015 and involve total misappropriations, on the prosecution case of $213,689.41.
The various sums charged are alleged to have been withdrawn by Mr Reid from the company account and then deposited, either to accounts operated by him, by cash withdrawal, or to his online betting accounts. The prosecution intends to adduce evidence that Mr Reid was asked a number of times to provide evidence of the purpose for these transactions so they could be duly entered into the Company’s accounts, about which he is said to have lied. Interspersed with the theft charges are 179 additional uncharged transactions amounting to $377,832.04, so that the total sum involved is $797,481.48.
Severance
The application for severance essentially founds on the central contention that the evidence advanced on the first set of counts is not admissible in proof of the second set, so severance should follow as a matter of course: Sutton v The Queen.[1] There is no contest that counts 1 – 7 are ‘cross-admissible’ inter se; likewise with respect to the second batch of counts.
[1] (1984) 152 CLR 528, 541-542.
Admission is sought by the prosecution pursuant to s 34P(2) of the Evidence Act 1929 (SA) of the uncharged transactions on the basis that the evidence is of sufficient probative value to justify admission for permissible uses, which uses substantially outweigh any prejudicial effect.
It can be readily accepted that the two respective sets of charges contain different formal elements. The gist of the charge of ‘deception’ under s 139(a) of the CLCA, lies in proof of a misrepresentation as defined in s 130 of the CLCA. To deceive is to induce a person to believe the representation is true but which is in fact false, knowing or believing it to be false: The King v Kidman,[2] R v Kastratovic.[3] A representation is dishonest if an accused deals dishonestly, according to the standards of ordinary people, knowing the dealing is dishonest by these standards: Peters v The Queen,[4] MacLeod v The Queen.[5]
[2] (1915) 20 CLR 425, 447.
[3] (1985) 42 SASR 59, 71-72.
[4] (1998) 192 CLR 493, [18]-[19].
[5] (2003) 214 CLR 230, [46].
The gravamen of theft is dealing with property, in this case money, dishonestly without the owner’s consent, intending to deprive the owner permanently of it, or to make a serious encroachment on the owners proprietary rights: s 134(1) CLCA.
It can be seen then that there are significant common features in both sets of charges in the central requirement to prove dishonesty. Whilst clearly not the same offences, joinder is justified nevertheless when there is a sufficient nexus between the counts. As Dawson J explains in R v De Jesus,[6] the phrase to constitute ‘a series of offences of the same or similar character relates rather to the facts alleged by the prosecution to constitute the offences rather than to their legal characteristics’.
[6] (1986) 61 ALJR 1, 9.
Here the central character of both sets of charges is the requirement to prove dishonesty. The case for the defence is said to be the acquiescence or even consent of the other two Directors. Conduct is not dishonest if an accused honestly but mistakenly believes in the right to act in that way: s 131(5) and (6) CLCA, R v Kerin.[7]
[7] (2013) 116 SASR 316, [191]-[199].
Cross-admissibility
The Prosecution points to a number of uses justifying admission for permissible purposes. These include:
·To support the allegation of dishonesty in that money was acquired for one purpose but used for another;
·To confirm the identity of the accused as instigator of the subject transactions;
·To give context to the transactions given the relationship of trust and long-standing friendship between the accused and the other two Directors;
·To provide context, that is to inform of the reasons for the advances and of the terms and limits of Mr Reid’s authority to withdraw funds;
·To demonstrate consistency of conduct by assisting to identify what Mr Reid’s actual state of mind accompanying each transaction was;
·To present to the jury the ‘whole picture’ so as to understand the magnitude and extent of the offending, that is to say to present the complete story of the accused’s dealing as a Director;
·To demonstrate the wider context and potential motive in which the transactions were made, particularly those used for gambling;
Those uses are legitimately available so as to render the first group of counts, ‘cross-admissible’ in respect of the second group. These transactions are further admissible to prove guilty knowledge of a dishonest scheme or system, and in order to rebut any potential defence of acting innocently, with authority or with consent: Finlayson v The King,[8] R v Phan,[9] R v Gibbs,[10] and R v Mussolino.[11] Still further, those counts are capable of use in conjunction with the second group of counts, given such a large number of transactions as potentially rendering an innocent explanation circumstantially or coincidentally unlikely: Martin v Osborne,[12] R v Phan.[13] For the same reasons, the evidence of the uncharged transactions by which the accused is alleged to have appropriated monies are admissible for the same permissible purposes.
[8] (1912) 14 CLR 675, 678 and 681.
[9] (1990) 54 SASR 561, 570.
[10] (1992) 58 SASR 347, 350.
[11] (2003) 86 SASR 37, 39.
[12] (1936) 55 CLR 367, 375.
[13] (1990) 54 SASR 561, 570.
Jury directions
It is on those bases that it is possible to identify and explain how the evidence may and may not be used in compliance with s 34R(1) of the Evidence Act, correspondingly rendering it possible to sufficiently direct the jury to separate the admissible and impermissible uses, thus removing any appreciable risk of the evidence being used for an impermissible purpose, as required by s 34P(3) of the Evidence Act: R v C,CN,[14] Perarra-Cathcart v The Queen.[15]
[14] (2013) 117 SASR 64, [22]-[26].
[15] (2017) 260 CLR 595, [51]-[52].
In light of this conclusion it is not necessary and in any event potentially confusing to admit the evidence relating to the first seven counts, on a propensity basis, pursuant to s 34P(2)(b) of the Evidence Act, whether or not it has ‘strong probative value having regard to the particular issue or issues arising at trial’. If the jury accepts one or more of the bases of permitted uses pursuant to s 34P(2)(a), then the evidence will necessarily acquire the quality of strong probative value, so that it would in effect be doubling up to allow for admission on an unnecessary ‘propensity’ basis.
Undue prejudice or oppression
Mr Moffa counsel for Mr Reid was on stronger ground in so far as he submitted a jury might be overwhelmed and thereby impermissibly and incurably prejudiced by the sheer weight of numbers of the charged and uncharged transactions. He laid stress on the observations of Hawkins J in R v King,[16] when observing 40 counts of obtaining or attempting to obtain goods by false pretence and obtaining credit by false pretences, amounted to a ‘… scandal that an accused person should be put to answer such an array of counts, containing … several distinct charges’. When one reads the report however, it appears the various groups of charges were not necessarily cross-admissible.
[16] [1897] 1 QB 214, 216.
The courts, and particularly the Victorian courts, have of recent times grown increasingly critical of what has come to be called ‘information overload’. For instance in R v Smart,[17] a particularly long trial, the court considered 63 counts charging various offences, was ‘simply too complex to justify the counts all being tried together’.[18] The court took a similar view in a case cited by Mr Moffa, R v Appleby,[19] in respect of 94 counts of theft and one of obtaining financial advantage by deception. It is true that an appeal was allowed because of the failure to sever, but it is equally true that this was because, in part at least, the ‘evidence of any facts pointing to the theft of the goods’ were not relevant to the other counts.[20]
[17] (1982) 6 A Crim R 192, 194.
[18] At 196.
[19] (1996) 88 A Crim R 456.
[20] At 466-467.
Then in R v Walker & Kormez,[21] an appeal was allowed in the case of an Information containing 17 counts ranging over six different offences alleging serious sexual assaults, which presented quite different forensic difficulties:
[8]  The counts preferred against the two accused included not only counts of rape and other serious offences but also counts of aiding and abetting the commission of some of those offences. Why those counts or the count of threatening to inflict serious injury (of which both accused were acquitted) were necessary is not immediately apparent. In our view, they “overloaded” the presentment.
[9]  The difficulties which the presentment created for the trial judge are obvious. His Honour had to direct the jury on 17 different sets of facts, all arising within a very short time frame. The law on a number of different offences had to be related to the facts relevant to each of those counts. Unsurprisingly, the judge’s charge (with a jury question and necessary discussion with counsel) appears to have occupied some, at least, of three separate days. It generated over 160 pages of transcript.
[10]  The jury’s task was just as onerous. They were required to understand the law applicable to a number of different offences and then to remember all of the judge’s directions of law relating to the individual offences, and to criminal trials generally, whilst considering the facts of which they were satisfied beyond reasonable doubt. There is also the obvious difficulty of sentencing a person convicted of numerous offences arising out of the same transaction or a series of closely connected transactions.
[21] [2011] VSCA 160.
Last MacFie v The Queen,[22] involved 52 counts alleging various offences mostly of a sexual nature. The court dismissed an appeal on the following grounds:[23]
[38] It is certainly arguable that the indictment could have been better drawn. Parsimony is often an appropriate default position by prosecutors and judges in the criminal sphere. The Crown had more than enough material upon which to present the appellant to the jury for the person he is. The omission of the most minor of the charges, such as some at least of those alleging touching of fully clothed breasts, would not have deprived the jury, or the sentencing judge if a conviction were recorded, of an accurate picture of the criminality alleged by the prosecution.
[39] On the other hand, there was among the 41 counts of sexual misconduct of which the applicant was found guilty a forensically significant collocation of common threads. These, collectively, revealed the applicant’s modus operandi and — more importantly — the extent of his criminality. The picture would have been badly distorted, and justice would not have been done, had the indictment been split, or had the jury for some other reason not been given the full picture of the applicant’s criminality. Trials must be fair to the prosecution as well as the defence, and justice generally demands that evil be fully exposed.
[22] [2012] VSCA 314.
[23] At [38]-[39].
There was a further consideration in MacFie which is particularly applicable to this case:[24]
In my opinion, the suggestion that the indictment should have been or — if the appeal is allowed, should be — severed, is impractical. It would be difficult if not impossible to group the offences in a sensible way. When that difficulty is coupled with the importance of presenting to a jury and a sentencing judge the full criminality of the applicant’s behaviour, in what is clearly a series of inter-connected offences during a single, and clearly defined, period of offending, the criticisms of the indictment largely fall away. It could not properly be described as manifestly unjust.
[24] At [49].
The situation here is much the same. Severance is impractical and if made would be on arbitrary and unsystematic bases. Severance would achieve little other than subject Mr Reid to two trials in which substantially the same evidence is properly admissible, irrespective of the number of formal charges.
Of course, it remains necessary to warn appropriately of misuse along the lines suggested in such cases as KRM v The Queen,[25] to the extent that the jury is not to reason that because they find the accused guilty of one count, they are not to reason he is the kind of person to have done so on other occasions.
[25] (2001) 206 CLR 221, [38], [40].
At present it would appear appropriate to give the jury a supplementary general direction similar to that given in an earlier case involving over 80 counts of dishonesty, along the following lines: R v Reid, Reid & Dasborough:[26]
I direct you … that you must not think because there are so many charges that something must be wrong or the accused must be guilty of at least some of the offences. That kind of reasoning process would be quite wrong. Subject to the directions I will give you in detail, you are in general to consider each count separately in relation to the evidence admissible on it alone, … Nor should you, … allow yourselves to feel overwhelmed by the volume of material or overawed by it to the point of thinking because of it something must be wrong. Your task is to review all the evidence and ask yourselves at the end of the day whether the prosecution has proven its case as to each charge beyond reasonable doubt separately.
[26] DCCRM-03-531, 4 December 2006.
Conclusion and Orders
For the above reasons the two groups of offences are properly joined and available to the jury under proper instruction as of permissible relevance and probative to each other.
The application for severance is therefore dismissed.