Thorpe v The Queen

[2016] VSCA 158

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCR 2015 0231

PETER THORPE	Appellant
v
THE QUEEN	Respondent

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JUDGES:	WEINBERG and PRIEST JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	11 July 2016
DATE OF JUDGMENT:	11 July 2016
MEDIUM NEUTRAL CITATION:	[2016] VSCA 158
JUDGMENT APPEALED FROM:	DPP v Thorpe (Unreported, County Court of Victoria, Judge Gaynor, 25 October 2015)

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CRIMINAL LAW —Appeal — Sentence —Theft from partnership and company — Breach of trust — Severe damage to financial wellbeing of victims — Whether sentencing judge misunderstood punitive nature of a community correction order (‘CCO’) — Whether judge erred in not imposing CCO — Total effective sentence of 3 years’ imprisonment with a non-parole period of 2 years — Whether sentence manifestly excessive — Appeal dismissed.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr C Farrington	Hartley’s Lawyers
For the Respondent	Ms F Dalziel	Mr John Cain, Solicitor for Public Prosecutions

WEINBERG JA:

1. I will invite Priest JA to deliver the first judgment.

PRIEST JA:

Introduction

1. On 16 April 2015, the appellant pleaded guilty in the County Court to two charges of theft.[1]  

   [1]Crimes Act 1958, s 74. The maximum penalty is 10 years’ imprisonment.

1. Following a plea hearing which extended over three separate days, on 12 November 2015 the sentencing judge sentenced the appellant to be imprisoned for 18 months on the first charge, and for two years on the second.  Twelve months of the sentence on charge 1 was ordered to be served cumulatively with the sentence on charge 2, resulting in a total effective sentence of three years.  The judge fixed a non-parole period of two years.  Compensation orders respectively for $89,429.09 (charge 1 — in favour of ‘CCI’) and $174,878.97 (charge 2 — in favour of ‘CCIMG’) were also made.

1. The appellant sought leave to appeal on two grounds:

1.   The learned sentencing judge erred in that she found that the offending was too serious to be dealt with by a community correction order.

2.   The individual sentences on charges 1 and 2, the non-parole period, and the total effective sentence imposed on the applicant was in all the circumstances manifestly excessive.

1. On 10 March 2016, a judge of this Court granted leave to appeal on the first ground, and referred the second ground to the court hearing the appeal.

1. For the reasons that follow, the appeal must be dismissed on the first ground, and leave to appeal refused on the second.

Circumstances of the Offending

1. The appellant and the complainant, Ray Chapman, met in 1997 when the appellant was working as a Business Manager with the ANZ Bank.  In 2006, the appellant and Mr Chapman formed a partnership called the Chapman Civil Industries Management Group (‘CCIMG’).  At that time, Mr Chapman was the owner of a company called Chapman Civil Industries (‘CCI’).

1. Management of the financial affairs of CCIMG and CCI fell to the appellant. Between July 2006 and September 2009, the appellant stole $264,308.06 from those entities.  Charge 1 related to theft from CCI, and involved the appellant stealing $89,429.09 in sixty separate transactions from 10 November 2006 to 10 July 2009.  Charge 2 concerned theft from CCIMG, and involved the appellant stealing $174,878.97 by way of 178 separate transactions from 13 July 2006 to 3 September 2009.

1. Several methods were used to accomplish the theft of the money, including the appellant paying a cheque to himself, but filling out legitimate creditor details on the cheque stub; paying himself double his regular salary; and paying himself a salary without paying a matching salary to Mr Chapman (in conformity with their partnership agreement).

1. Prior to the thefts coming to light, Mr Chapman had become concerned about the state of the books, and insisted that the appellant conduct an audit.  The appellant delayed doing so, at least partly because of his poor health.

1. On 11 August 2009, the appellant had to leave work for several days; and on 14 August 2009, he contacted Mr Chapman and told him that he had stolen $54,000.

1. As a result, Mr Chapman went to the appellant’s home.  The appellant told Mr Chapman that the offending started on 17 January 2009.  Somewhat benevolently, Mr Chapman told the appellant it was ‘not the end of the world’ and that the main thing was to be honest about what had been taken.  There was some discussion about the appellant selling his house to repay the money.  Ultimately, it was agreed that they would again discuss the matter on 17 August 2009.

1. On 17 August 2009, the appellant went to the office, and Mr Chapman advised him that the money stolen was in excess of $54,000.  The appellant later said it was $69,000.  When Mr Chapman asked about their partnership company, the appellant said the figure stolen was ‘around’ $ 120,000.

1. Almost a fortnight later, on 29 August 2009, the appellant’s wife delivered a deed of charge to Mr Chapman.  The deed — which was later rescinded — confessed the appellant’s involvement in the misappropriation of money and allowed Mr Chapman to place a charge over the appellant’s family home.  Some time later, however, the appellant’s wife claimed total ownership of the home and denied relief to Mr Chapman.

1. Upon Mr Chapman initiating legal proceedings to recover the losses, he recovered $152,000, but incurred costs exceeding $74,000 in legal and audit costs.

1. Mr Chapman reported the thefts to police on 3 September 2009.  He told police that the appellant stole or destroyed documents and deleted computer files. 

1. The appellant was arrested and interviewed by police on 16 November 2009. He admitted misappropriating funds but could not quantify the amounts stolen.  The appellant said that he had a ‘full on’ gambling addiction and would go to the ‘pokies’ six or seven nights per week.

1. More than three years elapsed before the appellant was charged on 9 April 2013.  The matter proceeded as a contested committal on 1 November 2013, with only the informant being called to give evidence.

The plea hearing

1. When first listed on 17 June 2015, the judge resolved to adjourn the plea hearing because ‘the factual matrix which underlies the plea is no longer the subject of agreement’.  The judge said that ‘needs to be fleshed out with a view to determining whether it has in fact become a contested plea’.

1. Ultimately, the plea hearing took place on 10 and 17 September 2015.

1. The appellant was aged between 42 and 45 years at the time of offending, and was aged 51 years at the time of sentence.  He was living with his elderly parents.  The appellant married in 1986 and had two daughters, one of whom was in court to support him.  In 1995, he was diagnosed with non-Hodgkin’s lymphoma, and underwent two courses of chemotherapy and a bone marrow transplant.  After four years in remission, he relapsed in 2000 and underwent radiotherapy (which had painful side effects).  The lymphoma returned in 2005 and he underwent a further round of chemotherapy.  Over a ten year period, the appellant was hospitalised a number of times.  During this time his daughters were born.

1. In 2013, when the appellant had been in remission for eight years and was separated from his wife, he met a woman and they became engaged in July of that year.  Unfortunately, she was then diagnosed with breast cancer and passed away in 2014.

1. At the time of the plea hearing, the appellant’s father was aged 90 years and his mother was aged 88.  His mother had been diagnosed with dementia and melanoma, and he had been providing assistance and care.  Counsel acknowledged, however, that any family hardship was not exceptional.

1. It was submitted that the appellant had no prior criminal history, and had contributed to the community in a significant fashion.  He should thus ‘get the benefit of that good character in the plea’.

1. Counsel for the appellant did not ‘press’ the appellant’s gambling ‘as being of any mitigatory value’.  But counsel did rely on a letter from Dr Shalini Arunogiri, Psychiatry Registrar of North Western Mental Health, dated 10 September 2009, which referred to the appellant’s referral to the CATT team ‘due to depressive symptoms, in the setting of ongoing stressors including financial difficulties secondary to pathological gambling, with a recent relationship breakdown with his wife’.  The appellant was referred to Beyond Blue, but he did not attend counselling specific to his gambling addiction.  It was submitted that the breakdown of his marriage and the loss of his children were ‘a huge trigger in his life in realising that the gambling had to stop immediately’.

1. Counsel submitted that the appellant’s conduct prior to being charged was indicative of remorse and he should receive the benefit of that conduct and his conduct since being charged.  The plea of guilty was significant because, had the matter proceeded to trial, it would have required five or six separate trials, given the number of individual charges that would have formed the indictments.  Further, Mr Chapman was not cross-examined, the only witness at committal being the informant.  The appellant’s counsel agreed, however, that the offending was a serious example of sustained abuse of a position of trust, not just due to the employer and employee relationship, but also because of friendship

1. Defence counsel’s ultimate submission was that a community correction order (‘CCO’), without a custodial component, was appropriate.

1. Prosecuting counsel submitted, however, that the appropriate sentence was one of immediate imprisonment.  The offending was a breach of trust — in circumstances where the appellant was not just a business associate, but was a friend — which changed ‘the financial lives’ of the victims forever.  It was ‘a very serious piece of offending … and a serious example of this type of offending’.  Among other submissions, the prosecutor submitted that the plea of guilty was indicative of some remorse, but it was a late plea.

Ground 1 — Did the judge err in finding that the offending was too serious to be dealt with by a CCO?

1. In the course of the plea hearing, the judge remarked that ‘the only punitive aspect [of the proposed CCO] is unpaid community work’, prompting the appellant’s counsel to agree that ‘the punitive component of a [CCO] would undoubtedly only be able to be addressed through community work, but … it could be a significant period of community work’.

1. Counsel submitted that Boulton[2] stood for the principle that a CCO may be appropriate in cases where a medium term of imprisonment might previously have been imposed.  Further, Boulton was authority for the proposition that CCOs could be imposed for relatively serious offences such as aggravated burglary, intentionally causing serious injury, some kinds of rape and some types of homicide.  Whilst it was conceded that the key sentencing considerations were punishment, general deterrence and denunciation, the aspect of punishment could adequately be dealt with by way of community work.  Counsel submitted that a CCO without imprisonment was an adequate sentencing disposition, taking into account prospects of rehabilitation and remorse.

   [2]Boulton v The Queen (2014) 46 VR 308 (Maxwell P, Nettle, Neave, Redlich and Osborn JJA) (‘Boulton’).

1. In the course of discussion, in answer to a submission by the appellant’s counsel that a CCO was appropriate, the judge said:[3]

How do you say that that properly answers just punishment, condemnation of his actions, abuse of trust, general deterrence?  How can a community corrections order alone address those factors which it must — you haven’t even addressed those, I mean, it seems to me that they are some of the principles which dominate the sentencing exercise before me.  I take into account the principles of delay.  Undoubtedly that’s something that is in your favour, but one of the interesting aspects of Boulton’s case is that great reference is made by the Court of Appeal to the punitive aspects available under a community corrections order and the Court specifically … referred to those punitive aspects, many of which are never in fact enlivened in any community corrections order handed down by this court. 

The only punitive aspect of a community corrections order that I can think of is unpaid community work.  That’s the only punitive aspect it would seem to me and we're not talking about electronic equipment being attached, we’re not talking about curfews, we’re not talking about any of those other matters that were referred to by the Court of Appeal where the only punitive aspect of the community corrections order is unpaid community work. 

This is for a serious breach of trust over a sustained period of time, theft from an employer and I might say, [defence counsel], you would be wise to address the victim impact statements.  It would appear from the victim impact statements — and I note that a couple of them, in particular a couple from — apart from those of Mr Chapman contain material which in my view is impermissibly taken into account.  But I don’t think it could be argued that your client’s actions have done anything other than left an absolute wreckage behind him.  The consequences of his actions have been particularly serious. 

Unless you've got some argument to make about that, again that is an aspect, in terms of the seriousness of this offending, where it falls is the range of serious offending that I am bound to take into account and at this point in time I have to say, [defence counsel], the fact that you are urging upon me a disposition whose (sic.) only punitive aspect is unpaid community work, I find incommensurate with the crime with which I am asked to deal.

[3]Emphasis added.

1. Insofar as her Honour’s remarks in the course of debate might be taken to indicate a view that the only punitive aspect of a CCO is community work, they betray a misunderstanding of the nature of a CCO.  As the Court made clear in Boulton, there are a number of punitive aspects attending a CCO beyond a condition that an offender undertake unpaid community work.[4]

   [4]Boulton, 331–2 [91]–[97].

1. In her sentencing remarks, however, the judge expressed the view that:

… this is a particularly serious case of abuse of trust resulting in theft.  It was submitted by your counsel, as I have said, that you should be dealt with by way of a community corrections (sic.) order.  In my view, this is an insufficient response to the offending that has occurred.

And her Honour observed that:

… in all the circumstances, as I have said, the only appropriate application of [the principles of punishment, denunciation and general deterrence] lies in a sentence of imprisonment to be served immediately.  This was a case where the victims were blameless.  They were your friends, as well as your employers, and as I said, their lives have been utterly traumatised and changed forever by your criminal actions.  In my view, a community corrections (sic.) order does not adequately answer the need for expression of the principles I have outlined and which I find to be the dominant factors in the sentencing exercise before me.

1. Hence it seems to me that, notwithstanding any views that the judge might have expressed in the course of discussion with counsel, by the time that she came to sentence the appellant, the judge had come to the view that a CCO was inadequate to reflect the need for just punishment, denunciation and general deterrence.  In my opinion, that was a view that was open to her Honour.  As I said In Hutchinson[5] (with the concurrence of Ashley JA):[6]

In Boulton, the court observed that a CCO may be suitable ‘even in cases of relatively serious offences which might previously have attracted a medium term of imprisonment’, since a sentencing judge ‘may find that, in view of the objective gravity of the conduct and the personal circumstances of the offender, a properly-conditioned CCO of lengthy duration is capable of satisfying the requirements of proportionality, parsimony and just punishment, while affording the best prospects for rehabilitation.[7]  The court said, however, that it was ‘both undesirable and unnecessary to seek to impose in advance any outer limits on the availability of this sentencing option’.  It was ventured that ‘realising the full potential of CCOs’ will require ‘a re-examination of accepted views about offences for which imprisonment has been thought to be the only option’, and that ‘process of rethinking and re-evaluation will take some time’.[8]

Acknowledging that a CCO might be appropriate ‘even in cases of relatively serious offences which might previously have attracted a medium term of imprisonment’, it should not be thought that Boulton offers a ‘Get Out of Jail Free’ card in situations where a sentence of imprisonment is necessary in a given case to satisfy the various purposes for which a sentence may be imposed.  One of the purposes for which a sentence may be imposed is, of course, ‘to punish the offender to an extent and in a manner which is just in all of the circumstances’.[9]  There will be cases — indeed, many cases — where, having regard to the seriousness of the offending, a CCO will be insufficiently punitive to satisfy the need to punish the offender in a manner which, in all of the circumstances, is just.[10]  At the risk of again traversing well-trodden ground, it is axiomatic that in every case the sentence imposed must depend on its own facts, including the circumstances of the offending and the offender, and the circumstances of aggravation and mitigation.

Although, as I have mentioned, the court in Boulton observed that a sentencing judge in a given case may find that, having regard to the gravity of the offending and the personal circumstances of the offender, a CCO is capable of satisfying the requirements of proportionality, parsimony, just punishment and rehabilitation, nothing in Boulton constrains a judge to impose a CCO where such a sentence would not be sufficient to reflect the objective seriousness of the offence and the circumstances of the offender.  In my opinion, this was a case where a CCO — standing alone — would have been inadequate to satisfy the need to punish and denounce the applicant’s conduct, and to provide a measure of general deterrence.

[5]Hutchinson v R (2015) 71 MVR 8.

[6]Ibid 12–13 [16]–[18]. See also McGrath v The Queen [2015] VSCA 176 (Maxwell P, Redlich and Kyrou JJA) [53]; DPP v Borg [2016] VSCA 53, [102]–[110] (Maxwell P, Weinberg and Priest JJA).

[7]Boulton, 338 [131].

[8]Boulton, 338 [133].

[9]Sentencing Act 1991, s 5(1)(a).

[10]The sentencing judge, it should be noted, paid specific regard to s 5(4C) of the Sentencing Act.

1. In this Court, the appellant’s counsel submitted that the learned sentencing judge erred in finding that this offending was too serious to be dealt with by way of a CCO.  Further it was submitted that even if the learned sentencing judge was correct in concluding that the offending was too serious to be dealt by way of CCO alone, she erred in failing to have the applicant assessed for a CCO in conjunction with a term of imprisonment.  Counsel contended that Boulton ‘sends a clear message that the CCO may be imposed in lieu of imprisonment’.[11]  Moreover, counsel argued that a CCO is a ‘genuine alternative to imprisonment’, ‘even in circumstances where the offences committed were of a serious nature’.[12] 

   [11]Citing Boulton, 335 [113].

   [12]Citing Boulton, 338 [131].

1. Counsel submitted that the appellant’s offending was not too serious to be dealt with by way of a CCO, in circumstances where:

·     there was a plea of guilty;

·     there was evidence of genuine remorse;

·     the appellant had made restitution of approximately $145,000 prior to being charged;

·     the appellant had no previous criminal history;

·     the delay, which was not attributable to the appellant (the offending having occurred between 13 July 2006 and 3 September 2009, but the appellant not being charged until April 2013);  and

·     the appellant’s background (including a protracted battle with cancer, a gambling addiction during the currency of the offending, the separation and divorce from his wife, the care of his parents, and the loss of a new partner to cancer).

1. The respondent submitted, however, that the mitigating features ‘are not particularly impressive’.  Although there was a plea of guilty, it was not an early one.  Further, the judge was only prepared to find that the appellant had shown ‘some’ remorse.  Restitution was made, but ‘only in part and late in the piece’.  As to delay, it was submitted that some of the delay was due to the appellant.  Gambling was not mitigatory.  Indeed, so it was submitted, the most powerful mitigatory feature present — the rehabilitative prospects, which were adjudged to be ‘excellent’ — is ‘not an uncommon feature in many fraud cases’.  In light of these matters, the sentencing discretion did not miscarry.  It was submitted that the option of immediate imprisonment was plainly within the permissible sentencing range.

1. As I have said, in my view it was open to the judge to conclude that the appellant’s offending was too serious to justify being dealt with by a CCO.  In his victim impact statement, Mr Chapman described the effect of the appellant’s peculation as ‘immense and irreparable’.  Prior to the appellant’s thefts, Mr Chapman and his family ‘were financially sound, happy and content’.  The appellant’s thieving ‘has destroyed [their] dreams and the financial security that [they] enjoyed’.  Victim impact statements by Mr Chapman’s wife, and other members of his family, make it clear that a number of people suffered significant adverse effects as a result of the appellant’s crimes.

1. Moreover, the appellant was in a position of considerable trust, which he abused.  He stole not only from an employer, but from a friend.  In the circumstances, he must have — as the judge thought —  ‘recognised the appalling consequences that could and did result from [his] thefts’.  His offending was protracted, and involved a large number of individual dishonest transactions, employing a variety of dishonest methods.

1. It was open to the judge to conclude that the appellant’s crimes were too serious to warrant the imposition of a CCO.

1. Ground 1 has not been made out.  The appeal must be dismissed.

Ground 2 — Is the sentence manifestly excessive?

1. Leave to appeal is sought on the ground that the sentence is manifestly excessive.

1. I would refuse leave.

1. Essentially for the reasons that I have canvassed in dealing with the first ground, in my opinion the sentence was one that was open in the sound exercise of the sentencing discretion.

WEINBERG JA:

1. I agree with Priest JA.

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