R v Schultz

[2022] NSWDC 63

District Court

New South Wales

Medium Neutral Citation:

R v Schultz [2022] NSWDC 63

Hearing dates:

25 February 2022 and 02 March 2022

Date of orders:

02 March 2022

Decision date:

02 March 2022

Jurisdiction:

Criminal

Before:

Grant DCJ

Decision:

I refuse to make the orders for compensation sought by the Crown.

Catchwords:

Criminal law – application for compensation – Victims Rights and Support Act 2013 – corporation as an aggrieved person – dishonestly obtain financial advantage by deception – employed based on false resume – work performed to standard required – no loss sustained by reason of the offending

Legislation Cited:

Corporations Act 2001 (Cth)

Crimes Act 1900 (NSW)

Interpretation Act1987 (NSW)

Victims Rights and Support Act2013 (NSW)

Cases Cited:

Fagan v Crime Compensation Tribunal (1982) 150 CLR 666

R v White (No 2) [2021] NSWDC 580

R v Wills: Application by Woolworths Limited [2013] NSWDC 1

Category:

Principal judgment

Parties:

Regina (Crown)
Timothy Leslie Schultz (Offender)

Representation:

Solicitors:
Mr S Baumgarten (DPP)
Ms K Espiner (Offender)

File Number(s):

2020/00181304

Publication restriction:

Nil

Judgment

1. The Crown seeks orders of the Court for compensation pursuant to s 97 of the Victims Rights and Support Act2013. It is said that the following entities are aggrieved persons and have sustained loss:

1. Charles Sturt University, $43,992;

2. Telstra Business Centre Tamworth, $6,254;

3. LRE Services, $91,599. Of that an amount the offender has paid $10,000; and

4. The Coleambally Irrigation Company, $48,584.

2. The application raises a number of issues. They can be summarised as follows:

1. Where the Act uses the word “person” does it include corporation;

2. If person also means corporation are any of the entities corporations as defined in s 57A of the Corporations Act 2001 (Cth);

3. Has the “aggrieved person” suffered loss through or by reason of the offence: s 97(1).

FACTUAL BACKGROUND

3. The offender on 21 October 2021 pleaded guilty to four counts of dishonestly obtain financial advantage by deception contrary to s 192D of the Crimes Act 1900. He was sentenced to an aggregate term of three years, commencing 19 October 2021 with a non-parole period of two years.

Charles Sturt University

4. In December 2017, the offender submitted a false resume to Charles Sturt University listing extensive IT experience over an 18 year period and university qualifications. He was offered employment and commenced on 1 February 2018 with an annual salary of $81,961.

5. An investigation of his qualifications began in July of 2018. As a result of that investigation, the offender resigned. The offender received a gross salary of $43,992.

Telstra Business Centre

6. On 30 September 2019, the offender gained employment with Telstra Business Centre Tamworth using a false resume. The resume was discovered to be false and his employment was terminated in October 2019. His gross wages were $6,254.

LRE Services

7. The accused said he was an electrical engineer. He was not. He was employed as an electrical engineer and began performing the role of electrical process controller for Walgett Shire Council town water supply, contracted to LRE Services by Walgett Council. LRE Services received information that the offender did not hold the qualifications he described. His employment was terminated. He was paid $91,599.

8. As a result of the offender’s employment by LRE Services, their contract with Walgett Council was terminated. This resulted in a loss of income to that entity of $600,000 per annum.

Coleambally Irrigation Cooperative Limited

9. The offender applied for a job and submitted a false resume. He was offered employment which commenced on 12 November 2019. The entity was contacted in June 2020 and informed of the offender’s previous criminal history and previous surname. The offender was arrested at his workplace on 18 June 2020. He had received a gross salary of $48,854.

10. The Crown concedes that there is nothing in the agreed facts that gives rise to a conclusion that the work was performed to anything other than the standard required.

DETERMINATION

Where the Act uses the word “person” does it include a corporation?

11. Section 97(1) of the Victims Rights and Support Act2013 provides:

(1) A court that convicts a person of an offence may (on the conviction or at any time afterwards), by notice given to the offender, direct that a specified sum be paid out of the property of the offender to any:

(a) aggrieved person, or

(b) aggrieved person in such proportions as may be specified in the direction,

by way of compensation for any loss sustained through, or by reason of, the offence or, if applicable, any further offence that the Court has taken into account under div 3 of pt 3 of the Crimes (Sentencing Procedure) Act 1999 in imposing a penalty for an offence for which the offender has been convicted.

(2) A direction for compensation may be given by a court on its own initiative or on an application made to it by or on behalf of the aggrieved person.

12. Section 96 defines “aggrieved person”.

The section provides in this division ‘aggrieved person’, in relation to an offence, means a person who has sustained loss through or by reason of:

(a) An offence for which the offender has been convicted, or

(b) A further offence that a Court has taken into account under div 3 of pt 3 of the Crimes (Sentencing Procedure) Act 1999 in imposing a penalty for an offence for which the offender has been convicted. “Court” means the Supreme Court, the Court of Criminal Appeal, the District Court or the Local Court.

13. Ms Espiner, who appears on behalf of Mr Schultz, in her helpful written submissions submits that:

“In the absence of any definition in the Act of the word ‘person’ that expands the definition of that word beyond its ordinary and natural meaning, these sections, and the scheme of the Act, mean that the Act provides for orders of compensation in favour of individual people, and not entities such as those for whom the compensation orders are sought”.

14. In support of her argument she has referred me to s 5 of the Act which provides:

(1) For the purpose of this part a victim of crime is a person who suffers harm as a direct result of an act committed, or apparently committed, by another person in the course of a criminal offence.

(2) If a person suffers harm, as a result of such an act:

(a) The person suffers actual physical bodily harm or psychological or psychiatric harm, or

(b) If a person’s property is deliberately taken, destroyed, or damaged.

15. She submits that the suffering of harm relates to an individual person. She says that this strongly suggests that the broader definition of a “person” in the InterpretationAct is meant to be excluded from the definition of “person” in the Act generally. She says that the Act does not mention words or phrases such as “corporations” or “company” or “corporate victim”.

16. Beguiling as this argument may be it is incorrect. Section 21 of the Interpretation Act1987 (NSW) defines person to include individuals, a corporation, and a body corporate or politic.

17. By reason of s 21 of the Interpretation Act, and under conventional rules of interpretation, “person” in the Act under consideration includes individuals, corporations, body corporates or politic. Such a construction is consistent with the purpose of the Act to compensate victims as an alternative to costly civil action. Such compensation should not be denied to corporations or body corporates or politic.

If person also means corporation, are any of the entities corporations as defined by s 57A of the Corporations Act 2001 (Cth)?

18. Section 57A of the Corporations Act provides:

Meaning of corporation:

(1) Subject to this section, in this Act, corporation includes:

(a) A company; and

(b) Any body corporate (whether incorporated in this jurisdiction or elsewhere); and

(c) An unincorporated body that under the law of its place of origin, may sue or be sued, or may hold property in the name of its secretary or of an officeholder of the body duly appointed for that purpose.

(2) Neither of the following is a corporation:

(a) An exempt public authority;

(b) A corporation sole.

19. Ms Espiner submits the following:

1. There is no evidence that Charles Sturt University is a corporation. An ASIC search categorises it as a “non-registered entity” which is an organisation not registered with ASIC;

2. Coleambally Irrigation Cooperative Limited on an ASIC search is categorised as a cooperative society. Material on the CICL website suggests that this entity was formed in April 2020. The offending took place between 14 November 2019 and 18 June 2020. The majority of the offending therefore occurred against an entity that no longer exists (Coleambally Irrigation Company). CICL on its website describes itself as a public authority for taxation purposes. She submits that s 57A(2) of the Corporations Act specifically deems that public authorities are not corporations. This submission is incorrect. An exempt public authority is not a corporation. There is no evidence that CICL is an exempt public authority.

3. Telstra Business Centre Tamworth is a cancelled business name. There is no evidence from the holder of the business name seeking compensation.

4. LRE Services is listed as a business name. There is no evidence before me that it is a corporation.

20. I am not satisfied that the entities seeking compensation are corporations. There are no applications on behalf of actual persons. If I am wrong (I have some doubts about the position of CICL which may be a corporation and not an exempt public authority), I am not satisfied that the aggrieved person has suffered loss.

Has the aggrieved person suffered loss through or by reason of the offences?

21. A causal connection between a loss and the crime must be established: Fagan v Crime Compensation Tribunal (1982) 150 CLR 666 at 673.

22. As a result of the offender’s conduct, he obtained a financial advantage. It does not automatically follow that this results in a corresponding loss on behalf of the entities.

23. The Crown concedes that there is nothing in the agreed facts that gives rise to a conclusion that the work was performed to anything other than the standard required. Put simply, the fraud induced the entities to employ him but they received economic value from the labour that he supplied to them under their employment contracts. They would not be able to rescind the contracts for employment for fraud and recoup the wages paid.

24. In my view, the aggrieved person has not sustained loss through or by reason of the offending and accordingly, I refuse to make the orders for compensation sought by the crown.

25. In coming to the foregoing conclusions, I am indebted to Abadee DCJ for what he wrote in R v White (No 2) [2021] NSWDC 580, and Haesler SC DCJ in R v Wills: Application by Woolworths Limited [2013] NSWDC 1.

**********

Decision last updated: 16 March 2022