Ryan v The King

[2022] SASCA 110

Supreme Court of South Australia

(Court of Appeal: Criminal)

RYAN v THE KING

[2022] SASCA 110

Judgment of the Court of Appeal  

(The Honourable President Livesey, the Honourable Justice Doyle and the Honourable Justice David)

21 October 2022

CRIMINAL LAW - APPEAL AND NEW TRIAL - APPEAL AGAINST SENTENCE - GROUNDS FOR INTERFERENCE - SENTENCE MANIFESTLY EXCESSIVE OR INADEQUATE

CRIMINAL LAW - PARTICULAR OFFENCES - PROPERTY OFFENCES - OTHER FRAUDS AND IMPOSITIONS - FRAUD - DEFRAUDING THE COMMONWEALTH

Following a trial by jury the applicant was convicted of 13 counts of dishonestly obtaining a financial advantage from a Commonwealth entity by deception, contrary to s 134.2(1) of the Criminal Code (Cth) and two counts of attempting to dishonestly obtain a financial advantage from a Commonwealth entity by deception, contrary to ss 11.1 and 134.2(1) of the Criminal Code (Cth). The applicant was jointly charged on five of these counts with his former wife.

For the 10 counts on which the applicant was solely charged, the sentencing judge imposed a single head sentence of six years’ imprisonment. For the five counts on which he was jointly charged, the sentencing judge imposed a single head sentence of four years’ imprisonment. Her Honour ordered that the two sentences be served concurrently and fixed a non-parole period of three years and six months. 

The applicant seeks leave to appeal against his sentence on the ground that it was manifestly excessive.

Held (the Court) granting permission to appeal but dismissing the appeal:

1.      It is not reasonably arguable that the sentence is manifestly excessive.

2.      The applicant’s sentence is neither unreasonable nor unjust.

Crimes Act 1914 (Cth) s 16A; Criminal Code Act 1995 (Cth) ss 11.1, 11.2A, 134.2, 400.1, referred to.
Aitchison v R [2015] VSCA 348; Bransby v R [2010] WASCA 165; Dinsdale v The Queen (2000) 202 CLR 321; Director of Public Prosecutions (Cth) v De La Rosa (2010) 79 NSWLR 1; Director of Public Prosecutions (Cth) v Gregory (2011) 34 VR 1; Dwayhi v The Queen; Bechara v The Queen (2011) 84 ATR 750; Edwards v R [2013] NSWCCA 54; Gok v The Queen [2010] WASCA 185; Heng v The Queen [2022] SASCA 24; Hili v The Queen (2010) 242 CLR 520; House v The King (1936) 55 CLR 499; Kovacevic v Mills (2000) 76 SASR 404; Markarian v The Queen (2005) 228 CLR 357; Milne v The Queen (2012) 88 ATR 14; Noble v R [2018] NSWCCA 225; R v Anderson [2012] QCA 215; R v Constant (2016) 126 SASR 1; R v Massey [2015] QCA 254; R v Morse (1979) 23 SASR 98; R v Nguyen (2010) 205 A Crim R 106; R v Peterson [2008] QCA 70; R v Pham (2015) 256 CLR 550; R v Rivkin (2004) 59 NSWLR 284; R v Scott [2017] SASCFC 96; Robertson v R [2007] NSWCCA 270; Tartaglia v The Queen (2022) 367 FLR 149, considered.

RYAN v THE KING
[2022] SASCA 110

Court of Appeal – Criminal:  Livesey P, Doyle and David JJA

THE COURT:

1. This is an application for leave to appeal against sentence.[1]

   [1]     This was referred to the Court of Appeal by Livesey P on 28 March 2022. 

2. On 29 March 2021, the applicant was sentenced for 13 counts of dishonestly obtaining a financial advantage from a Commonwealth entity by deception and two counts of attempting to dishonestly obtain a financial advantage from a Commonwealth entity by deception, contrary to s 134.2(1) of the Criminal Code, being the Schedule to the Criminal Code Act 1995 (Cth) (for the completed offences) and ss 11.1(1) and 134.2(1) of the Criminal Code (for the attempt offences).  The maximum penalty for each of these offences was 10 years or a fine of $66,000, or both. 

3. The applicant was solely charged with 10 counts and, for these, the sentencing judge imposed a single sentence of six years’ imprisonment.[2] For the five counts with which he was jointly charged with his former wife, Ms Amy Hill, on the basis of joint commission pursuant to s 11.2A of the Criminal Code (Cth), the judge imposed a single sentence of four years’ imprisonment.[3]  Her Honour ordered that these two sentences be served concurrently and she fixed a non-parole period of three years and six months.  The sentence was backdated to commence on 21 October 2020. 

   [2]     Eight counts of completed dishonestly obtaining a financial advantage from a Commonwealth entity by deception and two counts of attempting to dishonestly obtain a financial advantage from a Commonwealth entity by deception.

   [3]     Five counts of dishonestly obtaining a financial advantage from a Commonwealth entity by deception.

4. The appellant initially advanced five grounds of appeal against his sentence before abandoning Grounds 2 to 5. The sole remaining proposed ground of appeal is that the sentence is manifestly excessive. 

5. For the reasons that follow, leave to appeal should be granted but the appeal dismissed. 

   The circumstances of the offending

6. Between 2007 and 2012, the applicant was employed by the Australian Taxation Office (ATO) where his duties included making contact with taxpayers who had obtained an Australian Business Number, to ask those taxpayers questions to determine whether their registered entity was engaged in legitimate business for the purposes of Goods and Services Tax (GST).  The applicant received training regarding the circumstances in which a taxpayer is obliged to be registered for GST.

7. On 11 August 2010, the applicant was experiencing financial difficulties and submitted a written hardship application to the ATO, seeking the immediate release of his tax refund.  Although that application suggested hardship, the sentencing judge found that the applicant’s offending was motivated by financial greed.

8. Between April and December 2011, the applicant submitted ten Business Activity Statements (BAS) to the ATO claiming GST refunds.  These related to five different entities.  The applicant was the sole director of four of these.  These entities were not engaged in any commercial activity in the period covered by the BAS and the purchase figures submitted in the BAS were false; the entities were not entitled to any GST refunds.  The applicant obtained a total of $193,434.86 and attempted to obtain a further $75,685 in GST refunds to which he was not entitled.  This conduct comprised counts 1 to 10 and, of the amount obtained, the ATO has only recovered $98,604. 

9. In August 2011, the applicant commenced a relationship with Ms Hill and, during December 2011, filed five further false BAS for three entities for which Ms Hill was the sole director.  This resulted in the payment of $136,861 in GST refunds.  It was for this conduct that the applicant was jointly charged with Ms Hill and this comprised counts 11 to 15.  None of the funds obtained from this offending have been recovered. 

10. Whilst, as the sentencing judge observed, the scheme was not particularly sophisticated, nevertheless the applicant’s conduct was not impulsive or isolated.  Rather, it was pre-meditated, calculated and systematic, involving the lodgement of 15 BAS for eight companies over a period of eight months.  The applicant was the author of the scheme, and even after Ms Hill became involved, remained the primary offender. 

11. The applicant did not cease his offending voluntarily.  Rather, it came to light during a subsequent audit.  Even then, in an attempt to cover up his fraudulent activity, the applicant provided the ATO with numerous false documents including company prospectuses and invoices. 

12. When being sentenced for the attempt offences, the applicant was to be punished as if the offence had been completed.  The fact that the attempts failed did not reduce the applicant’s criminality.[4]

    [4]     Criminal CodeAct 1995 (Cth) sch 1 s 11.1(1). See for example, R v Nguyen (2010) 205 A Crim R 106, [72](l)-(m) (a case of attempted drug importation and attempted drug possession), applied in R v Constant (2016) 126 SASR 1, [33] (Nicholson, Lovell and Hinton JJ) and R v Scott [2017] SASCFC 96, [43] (Lovell J, with whom Stanley and Parker JJ agreed).

13. In sentencing for the completed offences committed by way of joint commission, the applicant fell to be punished for obtaining the financial advantage irrespective of who completed the deception or to whom the fraudulently obtained financial advantage was paid.[5]

    [5]     Criminal Code Act 1995 (Cth) sch 1 s 11.2A(1). See Tartaglia v The Queen (2022) 367 FLR 149, [119]-[120] (Livesey P, Doyle and David JJA).

14. The financial advantage actually obtained from the applicant’s offending was $330,295.86 (comprising $193,434.86 from his offending alone, and $136,861 from his offending with Ms Hill).  All of this, save for the $98,604 recovered by the ATO through a garnishee, represented loss suffered by the ATO.  However, in assessing the gravity of the applicant’s offending, it is also relevant to take into account the further $75,685 that was the subject of the attempted offences, bringing the total sum involved in the offending to $405,980.86.

    The circumstances of the offender

15. The applicant was 46 years at the time of sentence.  At that time his mother was terminally ill with breast cancer.  She died after sentence.  Until dismissal from the ATO in 2012, the applicant had enjoyed a good employment history.  He has since been unemployed.

16. At the time of sentence, the applicant had a daughter aged 16 with a previous partner and a daughter aged 6 with Ms Hill.  The applicant separated from Ms Hill in 2015 and they are now divorced.

17. Following his marriage breakdown, the applicant suffered from mental health issues including significant distress following his mother’s death.  Prior to being taken into custody, the applicant was without stable accommodation, often sleeping in his car.  He has been diagnosed with a chronic adjustment disorder with depressed mood and, possibly, a major depressive disorder.  He has also been diagnosed with a narcissistic personality disorder. 

18. The applicant has no prior convictions of relevance.  However, as is often said, this is of limited significance in the case of offending such as the present, involving repeated and deliberate dishonesty over a substantial period.  The relevance of good character is of lesser significance for “white-collar” crimes.[6] 

    [6]     R v Rivkin (2004) 59 NSWLR 284, [410] (Mason P, Wood CJ at CL and Sully J); Director of Public Prosecutions (Cth) v Gregory (2011) 34 VR 1, [53] (Warren CJ, Redlich JA and Ross AJA); Milne v The Queen (2012) 88 ATR 14, [272] (Whealy JA, Latham and Harrison JJ).

    The complaint of manifest excess

19. When evaluating a complaint of manifest excess for federal offending, the sentence must be assessed according to the overriding requirement to impose a sentence of appropriate severity having regard to all the circumstances of the offending.[7] The Court must also consider the non-exhaustive list of factors prescribed by s 16A(2) of the Crimes Act 1914 (Cth).

    [7] See s 16A(1) of the Crimes Act 1914 (Cth).

20. In this Court it is necessary to review the impugned sentence against the maximum sentence prescribed, the standards of sentence customarily observed with respect to similar offending, the objective seriousness of the criminal conduct and the personal circumstances of the offender.[8]  This Court must determine whether the sentence is “unreasonable or plainly unjust” having regard to all of the matters relevant to fixing sentence.[9] 

    [8]     R v Morse (1979) 23 SASR 98, 99 (King CJ, with whom White and Mohr JJ agreed).

    [9]     House v The King (1936) 55 CLR 499, 504-505 (Dixon, Evatt and McTiernan JJ); Hili v The Queen (2010) 242 CLR 520.

21. The appeal court may only intervene if the sentence is shown to be outside the permissible range of sentences for this kind of offending by this offender.  It is not sufficient for this Court to determine merely that it may have imposed a different sentence.  Accordingly, it is only if it is shown that the sentence was manifestly unreasonable or plainly wrong that this Court may infer that there has been a failure to properly exercise the sentencing discretion.[10]

    [10]   Dinsdale v The Queen (2000) 202 CLR 321, [58]-[59] (Kirby J); Markarian v The Queen (2005) 228 CLR 357, [25] (Gleeson CJ, Gummow, Hayne and Callinan JJ).

22. Whilst it is appropriate to have regard to tables of what are said to be comparative sentences, these merely provide “yardsticks” which illustrate but do not define the permissible range of available sentences.[11]  Though the sentencing tables demonstrate the range of sentences in fact imposed, they do not demonstrate that the range is correct or that the upper or lower limits of the sentences imposed represent the upper or lower limits of the appropriate range for sentence.  That is so notwithstanding that these ranges demonstrate sentencing patterns which reveal the application of the accumulated experience and wisdom of judges, whether at first instance or on appeal.  These tables do not fix the boundaries within which sentences should in the future be imposed.[12]

    [11]   R v Pham (2015) 256 CLR 550, [29] (French CJ, Keane and Nettle JJ); [47] (Bell and Gageler JJ), citing Hili v The Queen (2010) 242 CLR 520, [53]-[54] and Barbaro v The Queen (2014) 253 CLR 58, [41].

    [12]   Director of Public Prosecutions (Cth) v De La Rosa (2010) 79 NSWLR 1, [303]-[305] (Simpson J), cited with approval in Hili v The Queen (2010) 242 CLR 520, [54] (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ).

23. In contending that his sentence was manifestly excessive, the applicant emphasised several previous decisions from the respondent’s comparative sentencing schedule to demonstrate that the imposition of a sentence of six years for the offences comprised in counts 1 to 10 is unreasonable and plainly unjust.[13]  The applicant additionally took the Court to several cases that he submitted demonstrate that other sentences imposed in Australian jurisdictions of approximate equivalence to the applicant’s sentence involved substantially larger sums of money, a prior history of dishonesty offences, or more protracted or sophisticated offending.[14] 

    [13]   Gok v The Queen [2010] WASCA 185 (Gok); Bransby v R [2010] WASCA 165; Dwayhi v The Queen; Bechara v The Queen (2011) 84 ATR 750 (Bechara); R v Massey [2015] QCA 254.

    [14]   Robertson v R [2007] NSWCCA 270; R v Peterson [2008] QCA 70; R v Anderson [2012] QCA 215; Edwards v R [2013] NSWCCA 54; Aitchison v R [2015] VSCA 348; Noble v R [2018] NSWCCA 225.

24. Of the comparable decisions emphasised by the applicant, only two of the sentences were imposed following a trial.  In Gok,[15] the appellant was found guilty after a trial by jury of two counts of obtaining $184,916 by deception, contrary to s 134.2(1) of the Criminal Code.  The appellant was employed by the ATO to verify GST refund claims.  Whilst in this position, the appellant registered a business name.   His two half siblings also had business names.  The appellant subsequently issued false invoices to his siblings’ businesses, selling them a one third interest in his business.  He then created two BAS claiming a GST refund of $92,458 for each entity.  A total of $184,916 was refunded by the ATO, the appellant having verified one of the subject GST refunds himself in the course of his employment with the ATO.  The sentencing judge imposed a sentence of three years’ imprisonment and ordered that the appellant be released after serving two years’ imprisonment upon entering into a recognisance to be of good behaviour in the sum of $5,000.  The appellant sought leave to appeal against his sentence on a number of grounds, including that it was manifestly excessive.  The respondent sought leave to cross-appeal, alleging that the sentences were manifestly inadequate.  The appeal and cross-appeal were dismissed.

    [15]   Gok v The Queen [2010] WASCA 185.

25. In Bechara,[16] Mr Bechara prepared a document to be used in the preparation of a BAS for a company of which he was the sole director.  The BAS, which was signed by Mr Bechara, claimed a GST refund of $241,632 for a purchase of $2,657,952 which did not occur.  Mr Bechara then dealt with the refunded amount by transferring it into other accounts.  The ATO ultimately reversed the refund but were unable to recover $101,632.  Following a trial by jury, Mr Bechara was convicted of one count of obtaining a financial advantage by deception and one count of dealing with the proceeds of crime exceeding $100,000.[17]  The sentencing judge imposed an aggregate sentence of imprisonment of 4 years and 9 months and fixed a single non-parole period of 3 years.  Mr Bechara sought leave to appeal his sentence on the sole ground of disparity between his sentence and the sentences imposed on his two co-offenders.  The Court of Criminal Appeal granted Mr Bechara leave to appeal his sentence, and allowed the appeal on parity grounds; he was resentenced to a total effective sentence of three years’ imprisonment.  The Court ordered he be released on a recognisance release order after two years.

    [16]   Dwayhi v The Queen; Bechara v The Queen (2011) 84 ATR 750.

    [17] Contrary to ss 134.2(1) and 400.4(1) of the Schedule to the Criminal Code Act 1995 (Cth) respectively.

26. The applicant’s offending in this case can readily be distinguished from that in Gok and Bechara.  The appellants in Gok and Bechara were both sentenced for only two offences contrary to the Criminal Code.  The case of Gok involved the lodgement of two false BAS for two companies.  Bechara involved the lodgement of one false BAS for one company.  In the present case, the applicant stood to be sentenced for 15 counts.  His prolonged offending involved the lodgement of 15 BAS for eight companies over a period of eight months.  The applicant dishonestly obtained a total financial advantage of $405,980.86, a significantly higher advantage than was obtained in both Gok and Bechara. 

    The determination of the appeal

27. Whilst we have had regard to the sentences referred to in the submissions of counsel, as well as the sentences outlined in the table of sentences, it is important to recognise that the sentence which was imposed in this case followed convictions entered after guilty verdicts were returned by a jury following a trial. 

28. There has been no guilty plea and no demonstrated contrition or remorse.  The limited recovery made by the ATO to date was only by way of garnishee order.  The sentencing judge in this case correctly described the applicant as lacking insight and her Honour was concerned about his rehabilitation prospects. 

29. As well, it is important to recognise that the applicant was able to offend because he had acquired specialised knowledge whilst working with the ATO and in that sense his offending represented a very serious breach of trust.  Whilst that may also be said of two of the sentences relied on by the applicant on this appeal,[18] as has been explained the offenders in those cases were sentenced for more limited conduct involving only two charges against the Criminal Code.

    [18]   Gok v The Queen [2010] WASCA 185; Dwayhi v The Queen; Bechara v The Queen (2011) 84 ATR 750.

30. General deterrence and denunciation are prime considerations when sentencing for serious fraud against the Commonwealth and its agencies.[19] Both general and personal deterrence were particularly important sentencing considerations in this matter.

    [19]   Kovacevic v Mills (2000) 76 SASR 404, [39]-[40] (Doyle CJ, Mullighan, Bleby and Martin JJ); Director of Public Prosecutions (Cth) v Gregory (2011) 34 VR 1, [57] (Warren CJ, Redlich JA and Ross AJA); Milne v The Queen (2012) 88 ATR 14, [296]-[297] (Whealy JA, Latham and Harrison JJ); Heng v The Queen [2022] SASCA 24, [3]-[4] (Livesey P).

    Conclusion

1. When the full extent of the applicant’s offending is taken into account, together with the applicant’s personal circumstances, it cannot be said that the sentence which was imposed is manifestly excessive.  Whilst it may be considered high, it is neither unreasonable nor unjust.  Those who systematically defraud the revenue of significant sums may expect substantial custodial sentences.

2. Leave to appeal should be granted but the appeal dismissed.