Underwood v Schiwy

[1989] TASSC 129

Serial No B51/1989
List “B”

COURT:  SUPREME COURT OF TASMANIA

CITATION:              Underwood v Schiwy [1989] TASSC 129; B51/1989

PARTIES:  UNDERWOOD
  v
  SCHIWY

DELIVERED ON:  4 December 1989
JUDGMENT OF:  Nettlefold J

Judgment Number:  B51/1989
Number of paragraphs:  20

Serial No B51/1989

UNDERWOOD v SCHIWY

REASONS FOR JUDGMENT  NETTLEFOLD J

4 December 1989

1. Notice to review an order made by a magistrate in the Court of Petty Sessions at Hobart on the 1 September 1989 by which order the learned magistrate sentenced the applicant to six months' imprisonment for the offence of deception contrary to s252A(1) of the Criminal Code 1924. The grounds stated in the notice to review as amended are:–

1That the sentence was manifestly excessive having regard to all the circumstances of the case, and particularly the fact that the applicant is a 38 year old businessman running his own business, is married with three children, has no relevant prior conviction whatsoever and has made full restitution.

2That the learned magistrate erred in law by making conclusions which were not properly open to him and upon which conclusions counsel for the defendant was given no opportunity to make submissions upon.

1. The complaint reads as follows:–

"THE COMPLAINT of Detective 1/C Constable R K SCHIWY of Criminal Investigation Branch, Hobart, made upon oath, says that Garry Rupert UNDERWOOD, of 8 Brent Street, Glenorchy, did, on the 8th day of October 1986 at Moonah, in the State of Tasmania, by means of a certain deception, namely by exchanging the compliance plate on a 1980 WB Holden converted Utility, registered number CG 7705, to represent that the said vehicle was manufactured in 1982 as a Holden Utility, did dishonestly obtain a financial advantage from Timothy Norman WATTS, namely the difference in value between a 1980 Holden and a 1982 Holden, namely $1,900, by purporting to the said Timothy Norman WATTS that the vehicle was manufactured in 1982.

Contrary to Section 252A(1) of the Criminal Code Act 1924"

1. The facts as stated by the prosecutor were that on the 10th day of July 1986 the applicant purchased a 1980 Holden panel van from Motors Limited. The vehicle was subsequently delivered to the applicant's home and his wife signed for its delivery, using her maiden name of Grimwood. Shortly afterwards the applicant had a discussion with another person and arranged for the panel van to be converted into a utility. Arrangements were then made to obtain another compliance plate to attach to the vehicle. Approximately three weeks later the applicant picked up the converted car and another compliance plate. The applicant then removed the old compliance plate, which stated that it was a 1980 panel van and put on another plate which stated the vehicle was a 1982 utility.

1. During October 1986 the applicant re–registered the vehicle at the Transport Department as a 1982 WB utility, the registered number at that stage being CG 7705. He then produced to the Transport officer a receipt which showed that he had purchased a 1982 WB utility from P Grimwood for the amount of $6,500. This receipt, which the applicant wrote out himself, was false. On 8 October 1986 the applicant sold the vehicle to Tim Watts Cars for $7,000.00. Mr Watts bought the vehicle thinking that it was a 1982 model.

1. On the 16 August 1989 the applicant was interviewed by police officers. The interview was electronically recorded. The applicant admitted fitting the false compliance plate and making out a false receipt. He stated that he did this knowing he would get more money for selling a 1982 model compared with a 1980 vehicle. The trade price for a 1980 Holden WB ute was $5,100, according to Glass Dealers' Guide. The applicant gained a financial advantage of $1,900. The applicant's record was confined to minor traffic matters and one offence in 1980 of possession of liquor on Council Reserve.

1. In the course of the plea in mitigation counsel for the applicant said that the original purchase price for the vehicle was $2,750. The purchase was made in the course of running his business Garry Underwood Motors, Tolosa Street, Glenorchy. The applicant had not been involved in a conversion operation such as occurred here previously. But he saw the merit of the proposition put to him by the proprietor of a motor wrecking business. The applicant agreed to commission the motor wreckers to do the work. The motor wrecker also suggested that he could obtain a 1982 compliance plate for the vehicle so as to make it appear that the vehicle was indeed a utility and to add to the resale value of it.

1. When the offence occurred in 1986 the applicant and his wife had recently had their third daughter. The two older children were aged seven and five and the new arrival placed considerable financial strain on the applicant and his wife. The actual profit gained cannot be quantified exactly but the best estimate was about $1,600.

1. Mr Watts sold to a third party who eventually sold to Graham Saunders Motors. At all times the vehicle was being dealt with as a 1982 utility. The applicant, in an attempt to rectify the damage he had caused purchased the vehicle back for $7,920. As a result Mr Saunders as the only person who stood to suffer loss from the applicant's actions in fact made a profit, the true resale value of the vehicle being approximately $6,000. Counsel's submission was that, when viewed in totality, the applicant's net loss could well be approximately $1,000.

1. Counsel told the court that the applicant was 38 years of age and had been married for eight years. He had three daughters aged 10, 8 and 4. The applicant and his wife had resided in their home at 8 Brent Street, Glenorchy, for the duration of the marriage, the home being subject to a considerable mortgage. Since 1977 the applicant had conducted the business of a motor dealer. Prior to that he was employed by the Education Department at the science equipment supply depot and later he worked as a maintenance fitter at the New Town High School for some six years. Counsel submitted that the applicant was most remorseful, embarrassed and upset by the proceedings, having been unable to sleep since being charged.

1. In sentencing the applicant, having set out the facts, the learned magistrate said:–

"When determining the right penalty in any case the special deterrent effect which is hoped to be achieved far outweighs the generally (sic) deterrent effect which a sentencer may hope to achieve. Nevertheless, in this case the general effect of the sentence looms somewhat larger because there are so many used car yard operators in Tasmania who, if you are not adequately punished for your offence, may be tempted to conduct themselves as you have done for the purpose of defrauding clients. But I hasten to add I have no reason to think that falsifying compliance plates is really practiced at all – this is the first case of which I am aware, but the point should be made. You are married with three young children. I would expect that this conviction would seriously affect, if not make impossible your continuing in the business of buying and selling used cars, but in considering the sentencing options available to me I have come to the conclusion that I must impose a custodial sentence. The maximum fine I could impose is $2,000, but because of all the circumstances I am of the view that that would not be an adequate penalty. The maximum term of imprisonment I can impose in this case is imprisonment for twelve months. You are 38 years of age and you have been buying and selling used cars since 1977 and it is to be noted that you have no record whatever of any dishonest conduct. I am told you are remorseful, which I accept, and for that reason I shall not impose the longest period of imprisonment that could be imposed, but, as I have said, for the offence you have committed you should be imprisoned. So you are sentenced to imprisonment for six months, to date from yesterday the 31st of August."

1. The principles which limit the exercise by an appellate court of control over sentencing decisions must be borne in mind. The basic principle is as follows:–

"... the appeal is from a discretionary act of the court responsible for the sentence. The jurisdiction to revise such a discretion must be exercised in accordance with recognised principles. It is not enough that the members of the court would themselves have imposed a less or different sentence, or that they think the sentence over–severe. There must be some reason for regarding the discretion confided to the court of first instance as improperly exercised. This may appear from the circumstances which the court has taken into account. They may include some considerations which ought not to have affected the discretion, or may exclude others which ought to have done so. The court may have mistaken or been misled as to the facts or an error of law may have been made. Effect may have been given to views or opinions which are extreme or misguided. But it is not necessary that some definite or specific error should be assigned. The nature of the sentence itself, when considered in relation to the offence and the circumstances of the case may be such as to afford convincing evidence that in some way the exercise of the discretion has been unsound. In short, the principles which guide courts of appeal in dealing with matters resting in the discretion of the court of first instance restrain the intervention of this court to cases where the sentence appears unreasonable or has not been fixed in the due and proper exercise of the court's authority". (Cranssen v The King (1936) 55 CLR 509 at pp519–520).

1. In view of a submission which was made by counsel for the respondent based on some words which were used in the decision in Whittle v McIntyre [1967] Tas SR 263 it is necessary to cite some older references to that principle. In Skinner v The King (1913) 16 CLR 336 Barton ACJ said at p340:–

"... a Court of Criminal Appeal is not prone to interfere with the Judge's exercise of his discretion in apportioning the sentence, and will not interfere unless it is seen that the sentence is manifestly excessive or manifestly inadequate. If the sentence is not merely arguably insufficient or excessive, but obviously so because, for instance, the Judge has acted on a wrong principle, or has clearly overlooked, or undervalued, or overestimated, or misunderstood, some salient feature of the evidence, the Court of Criminal Appeal will review the sentence; but, short of such reasons, I think it will not."

(See also R v Withers (1925) 25 SR(NSW) 382 at p394).

1. In Bell v Lowe, B5/88, I stated my understanding of the sentencing policy of the court in this class of case in the following passage:–

"With great respect, such an approach is altogether out of line with modern sentencing practices. In R. v O'Connor [1987] VR 496, the Full Court consisting of Young CJ, Murphy and Fullager JJ said at p499:–

'In recent years the sentencing policies of the courts have certainly been opposed to the imposition of prison sentences wherever a reasonable alternative was open particularly in the case of young offenders: See Duncan v R (1983) 47 ALR 746 where the Supreme Court of Western Australia, sitting as a Court of Criminal Appeal said at page 749: "It is well settled that custodial punishment should not be imposed upon a young man until all avenues of non custodial punishment have been explored."'

That statement also expresses the sentencing policies of the Supreme Court of Tasmania. In similar spirit is Crimes Act 1914 (Clth) s17A and Penalties and Sentences Act 1958 s11 (Victoria). That the English courts have a similar policy to that which prevails in Victoria, Tasmania and other Australian States is made clear by two recent interesting cases, namely Clarke (1982) 4 Cr App R (S) p197 and Livingstone Stewart and Other Appeals and Applications (1987) 85 Cr App R p66. The latter case demands study by those who would seek to deal with Social Security Fraud cases in a restrained and responsible way, not because it is binding but because it is right. The case shows, among other things, that for Social Security Act offences, in magistrates' courts in England and Wales in 1985 the total of those found guilty was 6,368 of whom 17 were committed for sentence. The remaining 6,351 were disposed of as follows:–

(a)   Absolutely Discharged  0.2 percent

(b)   Conditionally Discharged  13 percent

(c)   Probation Order  7 per cent

(d)   Fined  59 percent

(e)   Community Service Orders  10 percent

(f)    Fully Suspended Sentences of Imprisonment              6.5 percent

(g)   Unsuspended Terms of Imprisonment  2.5 percent

(h)   The remainder were the subject of a variety of disposals.

The judges pointed out that a very large number of such cases were not prosecuted by the departments at all. Cases involving small amounts, except where there are special features such as repeated fraud or the necessity to provide a deterrent to a particular type of fraud prevalent in a particular locality. Cases which were not prosecuted were dealt with by warning and/or deduction from future benefits. The judges in this case were dealing with appeals and applications from decisions in Crown Courts. It will be seen that, therefore, they were dealing with exceptionally serious cases. The judges pointed out that the cases in this group involve the dishonest abstraction of honest taxpayers' money and not to be treated lightly. They are easy to commit and difficult and expensive to track down. However, their Honours said that it must be remembered that they are non–violent, non–sexual, and non–frightening crimes. But for some cases at the top of the range immediate unsuspended imprisonment (or youth custody) was unavoidable as these cases involved carefully organised frauds on a large scale in which considerable sums of money are obtained. The offenders are in effect professional fraudsmen. But they pointed out that these cases bear little relation to the average offender in this area. As to the remainder of the cases in the Crown Court, the judges said at p70:–

'As to the remainder, who form the great majority of those appearing in the Crown Court, the sentence will depend on an almost infinite variety of factors, only some of which it is possible to forecast. It may well be advisable as a first precaution for the Court to enquire what steps the department proposes to take to recover their loss from the offender. Counsel for the Crown should be equipped to assist the Court on this aspect of the matter. There are other aspects on which his help will often be required, as will emerge later.

Other considerations which may affect the decision of the Court are:

(i)a guilty plea;

(ii)the amount involved and the length of time over which the defalcations were persisted in (bearing in mind that a large total may in fact represent a very small amount weekly);

(iii)the circumstances in which the offence began (e.g. there is a plain difference between a legitimate claim which becomes false owing to a change of situation and on the other hand a claim which is false from the very beginning);

(iv)the use to which the money is put (the provision of household necessities is more venial than spending the money on unnecessary luxury);

(v)previous character;

(vi)matters special to the offender, such as illness, disability, family difficulties, etc;

(vii)any voluntary repayment of the amounts overpaid.

Before sentencing the offender the court should consider the following questions which were set out in Clarke (1982) 4 Cr App R (S) 197, 200. (i) Is a custodial sentence really necessary? The fraud cases dealt with in the Crown Court (as already indicated) are likely to be relatively serious and a non–custodial sentence may often be inappropriate. (ii) If a custodial sentence is necessary, can the court make a community service order as an equivalent to imprisonment, or can it suspend the whole sentence? It seems to us that a suspended sentence or (especially) a community service order may be an ideal form of punishment in many of these cases. (iii) If not, what is the shortest sentence the court can properly impose?

If immediate imprisonment is necessary, a short term of up to about nine or twelve months will usually be sufficient in a contested case where the overpayment is less than, say, 10,000. As was stated in Clarke, a partly suspended sentence may well be appropriate where a short immediate sentence is insufficient.'

For present purposes, I emphasise the question the judges took from Clarke's case 'Is a custodial sentence really necessary?' That question and the other questions they took from Clarke's case show that their sentencing practice is in line with the practice in this Court and the practice in Victoria and Western Australia as evidenced by the cases cited above. It is also, generally speaking, in line with the policy behind the Commonwealth and Victorian statutes cited above."

1. In this case the sentence fails to estimate correctly the weight to be assigned to the element of general deterrence in the light of modern sentencing policy in cases of this kind. It over estimates the need for general deterrence and under estimates the applicant's very strong case for a sentence which stops short of an order for immediate imprisonment. There was no suggestion that the type of offence in question was prevalent. In fact the learned magistrate said "but I hasten to add I have no reason to think that falsifying compliance plates is really practised at all – this is the first case of which I am aware".

1. On the material before the learned magistrate the fair conclusion was that the offence was out of character.

1. The applicant had been in business for a long time and was 38 years of age and this was his first conviction for an offence involving an element of dishonesty. The reasonable conclusion was that it was most unlikely that he would offend again and, consequently, a sentence of imprisonment was not required in order to deter him from offending again.

1. In addition, there were strong mitigating factors. As previously mentioned, the applicant is a 38 year old first offender and the father of three young children. In effect, he made restitution. He co–operated with the police and pleaded guilty. The amount of money involved is, relatively speaking, small. Because of this conviction, it is difficult to see the applicant having any future in the kind of business he had been in for over a decade. Consequently, quite apart from the penalty imposed by the court, he had suffered substantial detriment in consequence of his offence.

1. With respect, having considered all the circumstances of the case, the clear conclusion is that it was not necessary to send this man to gaol for the first time for this offence. To do so was to impose a sentence which was manifestly excessive.

1. What troubled the learned magistrate was the potential for harm which offences of this class have. In the circumstances of this case that factor is given adequate recognition by a short sentence, the execution of which is wholly suspended.

1. For these reasons there will be the following orders:–

1Appeal allowed.

2The sentence of six months' imprisonment is set aside.

3In lieu thereof there will be a sentence of three months' imprisonment, the execution of the whole of which is suspended on condition that the applicant commit no crime or offence involving an element of dishonesty for a period of three years.