Whyte v Director of Public Prosecutions (Cth) - [2008] SASC 310

Supreme Court of South Australia
(Magistrates Appeals: Criminal)
WHYTE v DIRECTOR OF PUBLIC PROSECUTIONS (CTH)
[2008] SASC 310
Judgment of The Honourable Chief Justice Doyle (ex tempore)
6 November 2008
CRIMINAL LAW - PARTICULAR OFFENCES - PROPERTY OFFENCES - FALSE PRETENCES AND OTHER FRAUDS AND IMPOSITIONS - OFFENCES INVOLVING IMPOSITION - IMPOSING ON THE COMMONWEALTH
SOCIAL WELFARE - OFFENCES - FALSE STATEMENTS AND FRAUD - PENALTY
Appellant pleaded guilty to two counts of obtaining a financial advantage from a Commonwealth entity (Centrelink), knowing or believing that she was not entitled to financial advantage contrary to s 135.2(1) Criminal Code (Cth) – appellant spent allowance on drugs – offence detected through checks conducted by Centrelink – appellant repaid entire amount of allowance – appellant no longer suffering from drug addiction – maximum term of imprisonment applicable to offences two years – Magistrate sentenced appellant to two years' imprisonment, one year to be served – Magistrate indicated that he would have sentenced the appellant to two years eight months' imprisonment had appellant not pleaded guilty to offences – appeal against sentence imposed by Magistrate.
Held: Magistrate began sentencing with a starting point in excess of the maximum period of imprisonment applicable to offences – sentence actually imposed by Magistrate equal to the maximum period of imprisonment applicable to offences – Magistrate erred – appeal allowed and appellant resentenced.
Criminal Code (Cth) s 135.2(1); Crimes Act 1914 (Cth) s 4K, s 19(2), s 19AC, s 20(1), referred to.
Kovacevic v Mills [2000] SASC 106; (2000) 76 SASR 404, applied.

WHYTE v DIRECTOR OF PUBLIC PROSECUTIONS (CTH)
[2008] SASC 310
Magistrates Appeal: Criminal

DOYLE CJ (ex tempore). This is an appeal against sentence. It is common ground that the Magistrate erred, and that the sentence should be set aside. The parties agree that I should re-sentence the appellant.
Ms Whyte pleaded guilty before a magistrate to two charges of obtaining a financial advantage for herself from the Commonwealth Services Delivery Agency, more commonly known as “Centrelink”, knowing or believing that she was not eligible to receive the financial advantage, contrary to s 135.2(1) of the Criminal Code (Cth). The maximum penalty for each offence is imprisonment for 12 months or a fine of $6,600 or both.
The Magistrate recorded a conviction on each count. Acting pursuant to s 4K of the Crimes Act 1914 (Cth) he imposed one penalty of two years’ imprisonment. Exercising the power conferred by s 20(1)(b) of the Crimes Act the Magistrate ordered that Ms Whyte be released after serving one year of imprisonment, on condition that she enter into a recognisance in the sum of $500 to be good behaviour for a period of three years from the time of release. Ms Whyte appeals against the sentence on the basis that it is manifestly excessive.
The circumstances of the offending are as follows.
Count 1 relates to a period from 15 December 2003 to 20 September 2004. Count 2 relates to a period from 4 October 2004 to 2 October 2006. The offending conduct by Ms Whyte was the obtaining of payments of Newstart Allowance when she was not entitled to the payment of that allowance. During the whole of this period, Ms Whyte was employed. During that period she earned from her employment about $106,000.
About three months before the offending conduct began, Ms Whyte lost her employment. She applied for Newstart Allowance, and her application was successful. There is no suggestion that she was not entitled to receive the allowance at first. She did not inform Centrelink that she had obtained employment in December 2003. She continued to receive the Newstart Allowance until October 2006. The amount of the allowance that she received, without being entitled to receive it, is $35,602.21.
Ms Whyte stopped claiming the benefits in due course, but did not disclose the earlier wrongful receipt of benefits. That came to light later as a result of checking by Centrelink. At no stage did Ms Whyte voluntarily disclose her offending conduct.
She has since repaid the money in question.
The Magistrate had before him a detailed report from Mr Balfour, a psychologist. It appears that he accepted the information in that report. I draw on that report. Ms Whyte is 53 years of age. There is nothing out of the ordinary about her upbringing or background. She has had steady and responsible employment for most of her adult life.
Apart from some minor offending more than eight years ago, she has an unblemished record.
Her difficulties appear to have begun as a result of an attachment to a man. It is not necessary to go into the details. Difficulties in that relationship led to her becoming depressed. She lost her employment in, I gather, about the middle of 2003. It was in those circumstances that she applied for and was granted the Newstart Allowance.
She had been an occasional user of illicit drugs. She began using them more frequently. Although she obtained employment again after about three months in December 2003, she continued to use drugs. She says that she used the unlawfully obtained money to meet the cost of the drugs.
She lost her employment as a result of the offending coming to light. However, she has obtained new employment, and has good prospects of remaining employed. She is a person of otherwise good character, despite some minor offending about eight years ago. She is unlikely to offend again, provided she abstains from illicit drugs. She says that she has now overcome her addiction, and is not using illicit drugs.
Nevertheless, the offending conduct is serious. The amount of money that she obtained unlawfully is substantial. Although the offending conduct began at a time when she was under a good deal of pressure, that does not excuse the offending. She obtained the money unlawfully to enable her to support the taking of illicit drugs. That is hardly a matter of mitigation.
The Magistrate summarised the relevant circumstances. No error has been pointed to in that summary.
The Magistrate rightly said that during the period of the offending conduct Ms Whyte earned sufficient money to support herself. She was earning in excess of $35,000 per annum.
The Magistrate referred to the need for a court, when dealing with offending of this kind, to bear in mind the need to protect the integrity of the social security system. The Magistrate also noted that this was a sustained course of dishonest conduct. The Magistrate referred to the repayment made by Ms Whyte.
He said that the mitigating features, including Ms Whyte’s depressive illness, were outweighed by the aggravating features which he summarised as being the duration of the offending, the fact that this was an offence attributable to greed, the amount of money involved, and the use of the money on illicit drugs.
Although the Magistrate did not refer specifically to this point, it is pertinent to bear in mind Ms Whyte apparently lodged at least 20 different applications for payment of the Newstart Allowance and probably more than that. The offending did not flow from a single dishonest application.
But for the plea of guilty, the Magistrate would have sentenced Ms Whyte to imprisonment for two years eight months. He reduced that sentence to two years’ imprisonment, having regard to the plea of guilty.
That sentence was excessive, and is erroneous. The Magistrate arrived at the sentence that he imposed by starting from a sentence that exceeded the maximum punishment for the two offences in question. As well, the sentence imposed is equal to the maximum punishment for the offences. The circumstances do not warrant a sentence of that severity. Accordingly, the sentence must be set aside.
I agree that it is appropriate that I should proceed to sentence Ms Whyte. I do so on the basis of the material before the Magistrate, and on the basis of the submissions made to me. I agree by and large with the Magistrate’s summary of the facts and of the circumstances of the case.
In Kovacevic v Mills [2000] SASC 106; (2000) 76 SASR 404 the Full Court of this Court reviewed the approach to be taken to the sentencing of offenders for dishonest conduct of this kind. The Court gave general guidance to the approach to be taken to sentencing for conduct involving deliberate and sustained fraud. Referring to such cases the majority (Doyle CJ, Mullighan, Bleby and Martin JJ) said at [40]-[43]:
[40]In our opinion the proper approach to sentencing is better reflected by saying that in a case of the type referred to by King CJ, [deliberate and sustained fraud] an order for imprisonment, with at least some of the imprisonment actually to be served, is ordinarily likely to be required. This is because the commission of a number of offences of fraud over a period of time makes imprisonment appropriate even for a first offender, because of the seriousness of the offending. The same matters may require that at least part of that term of imprisonment actually be served, even in the case of a person with no previous convictions. But there is still a need to consider all aspects of the matter, and to consider the interests of society and of the offender in the rehabilitation of the offender. Also, in an appropriate case, there may be room for the exercise of mercy and leniency: see Webb v O’Sullivan [1952] SASR 65 per Napier CJ at 66 and R v Osenkowski (1982) 30 SASR 212 at 212-213.
[41]In some cases the length of the period during which the offending occurs, or the amount involved, or the devices used to effect the fraud, is likely to lead a court to conclude that a sentence of imprisonment actually to be served is required. As is always the case in sentencing, and as Cox J said in R v King, a sentencing standard is a general guide to those who have to sentence in the future, with certain tolerances built into it.
[42]We agree with what Mullighan J said in Keeley v Department of Social Security (unreported, Supreme Court, SA, Mullighan J, No 1093 of 1993, 30 July 1993):
“I do not think the Full Court in R v Cameron, in saying that the deterrent purpose of punishment must be paramount, was laying down a principle of sentencing that in all cases of fraud against the welfare system mitigating features of the circumstances of the offence and the offender can never assume prominence. The Court was speaking of the type of serious fraudulent conduct which it there had to consider. In the more serious types of cases, the need to deter others who are minded to deliberately and systematically defraud the system must prevail over matters of mitigation. However, in less serious cases the need for deterrence will not be paramount.”
[43]In our view in the more serious cases of sustained and deliberate fraud, deterrence is very important, imprisonment is likely to be required, but all mitigating circumstances and the rehabilitation of the offender must still be considered. Substantial mitigating circumstances, and in some cases considerations of mercy and leniency may lead to the conclusion that a sentence of imprisonment is inappropriate or that such a sentence is appropriate, but that the imprisonment need not be served.
The majority made the following observation with reference to the question of reparation at [81]-[82]:
[81]Lastly, we mention reparation. Pursuant to s 16A(2)(f)(i), the Court is obliged to take into account any action by the appellant to make reparation in the context of contrition. As has been mentioned, the total amount received has now been repaid. It may be said that in arranging for reparation to be made, the appellant was doing no more than meeting an obligation imposed by law and repaying what he had illegally received by his own conduct. It should also be said that offenders cannot buy their way out of severe punishment by repaying what they should never have received. However, the Courts are obliged to regard reparation as a positive matter so far as an offender is concerned. In SA Police v John (1995) 181 LSJS 20, King CJ, with whom the other members of the Court agreed, said (at 22):
“The fact that somebody has made the sacrifice necessary to enable full restitution to be made is an important consideration and, of course, this court encourages that course to be taken.”
There the Court was sentencing under State law but the relevant provisions in the Criminal Law (Sentencing) Act 1988 (SA) are the same: see s 10(f). There are cases where reparation has been the decisive factor in the exercise of the discretion to suspend a custodial sentence: see R v Robertson (1984) 115 LSJS 51. ...
[82]In our view, the making of reparation is an important factor in the present circumstances and it should be acknowledged in a positive way in the sentencing process. Standing alone, it should not be regarded as decisive, but along with the other matters which have been mentioned, it justifies an order for immediate release.
In considering an appropriate sentence, I have this statement of principle in mind.
I return to the facts of the present case. This was a sustained period of dishonest conduct, involving more than one dishonest act. Ms Whyte received a substantial amount of money. Her offending cannot be said to be attributable to domestic, financial or other pressures of the kind that few people could withstand. All that can be said is that the offending began at a time when she was finding it difficult to cope. On the other hand, she is a person of otherwise good character. She has good prospects of retaining her current employment and of rehabilitating herself. She has made reparation. She has served 10 days’ imprisonment before being released pending the hearing of the appeal now before me.
Each offence calls for a sentence of imprisonment. Each offence involves dishonest conduct over a substantial period of time. The amount of money involved in each case is substantial. Offending conduct of this kind is, regrettably, not uncommon. Deterrence is an important consideration when deciding upon a sentence.
But for the pleas of guilty I would have sentenced Ms Whyte to imprisonment for six months on each count. It might be said that the second offence is more serious than the first, because it involves repetition of the offending conduct. But it can be said that all of the offending conduct flowed from the initial dishonest act, and that in the present case there is nothing to be gained by distinguishing between the two offences.
Making allowance for the pleas of guilty, I sentence Ms Whyte to imprisonment on each count for a period of four months and two weeks. Pursuant to s 19(2) of the Crimes Act, I direct that the sentence on count two commence on the expiry of the sentence on count one. The effect of that is that the total period of imprisonment to be served is eight months and four weeks.
I turn to the question of whether I should order the release of Ms Whyte, either forthwith or after she has served a specified period of imprisonment.
I again take into account the circumstances already referred to, and in particular the fact that Ms Whyte has served 10 days’ imprisonment.
Ordinarily, offending conduct of the kind before me would result in the Court requiring that a substantial part of the sentence of imprisonment be served. The seriousness of the offending, and the need for deterrence, would ordinarily point to that conclusion.
But Ms Whyte is a woman of good character, whose prospects of rehabilitation are good. I am influenced by the fact that she has already obtained new employment, and is likely to lose that employment if imprisoned. I am influenced by the fact that she has served 10 days’ imprisonment, and, to a lesser extent, by the fact that she has made complete reparation.
In all the circumstances, this is an appropriate case to give weight to the circumstances personal to Ms Whyte, and to treat those circumstances as outweighing the need for a deterrent sentence.
Pursuant to s 19AC and s 20(1)(b) of the Crimes Act, I order that Ms Whyte be released forthwith, upon her giving security in the sum of $500 to be of good behaviour for a period of two years. A further condition of her release, pursuant to s 20(1)(a)(iv), is that for a period of one year Ms Whyte be under the supervision of a Community Corrections Officer, and obey the lawful directions of that officer. In particular, she is to undertake counselling for substance abuse if so directed by the Community Corrections Officer. She is to report to the Elizabeth Office of the Community Corrections Department within seven days of today, and at such other times and places as directed.
I confirm the orders by the Magistrate relating to the payment of court fees, counsel fee, and service fee.