Director of Public Prosecutions (Cth) v Pratten

Solicitors: Commonwealth Director of Public Prosecutions (Appellant) Marsdens Law Group (Respondent) File Number(s): 2010/315475; 2012/207027 Decision under appeal Court or tribunal: Supreme Court; District Court Jurisdiction: Common Law Division; Criminal Citation: [2016] NSWSC 539 Date of Decision: 29 April 2016 Before: Rothman J; Baly SC DCJ File Number(s): 2010/315475; 2012/207027

headnote [This headnote is not to be read as part of the judgment] The respondent, Timothy Charles Pratten, was engaged in the sale of insurance through a company, Rural & General Insurance Ltd, from a date prior to the 2003 financial year. Following Commonwealth legislation which increased the regulatory requirements for writing insurance, the respondent changed his business operation, incorporating an insurer in Vanuatu. From 2002, the respondent also acted as an insurance broker in Australia through a separate company. During the 2003 to 2009 financial years, the broker collected premiums in excess of $19 million, which were remitted to one of two trust companies in Vanuatu. The broker charged a fee of 33% of the net premiums received, of which an amount in excess of $4.5 million was paid to the respondent, or at his direction for his own use, but was not declared by him as income in the relevant financial years. The respondent was arrested on 22 September 2010, and charged with seven counts of obtaining a financial advantage by deception, contrary to s 134.2(1) of the Criminal Code Act 1995 (Cth). A first trial resulted in convictions and sentences which were set aside on appeal. The second trial resulted in convictions on all seven counts. On 29 April 2016, the trial judge imposed a series of concurrent and partly accumulated sentences, resulting in a total sentence of 5 years imprisonment, with a non-parole period of 2 years, expiring on 19 January 2018. The Director appealed on the grounds of manifest inadequacy of the sentences. Following the respondent's arrest in 2010 for the tax offences, the Director obtained a restraining order under s 17 of the Proceeds of Crime Act 2002 (Cth) over a number of assets, including a fishing boat. On 3 July 2012, the respondent was arrested for attempting to remove the boat from Australia. He was charged with offences under s 37(1) of the Proceeds of Crime Act and s 11.1(1) of the Criminal Code (Cth). On 22 July 2016, he was convicted and ordered to pay a fine of $10,000. The Director also appealed against this sentence on the ground of manifest inadequacy. The appeal was heard concurrently with the appeal in relation to the sentences for the tax offences. The Court (Basten JA; S Campbell and N Adams JJ agreeing) upheld the Director's appeals and found:

1. Accepting that "double jeopardy" may underpin the general law principle constraining the resentencing discretion, following a second trial, s 16A of the Crimes Act 1914 (Cth) did not accommodate that principle: [39]. Bui v Director of Public Prosecutions (Cth) (2012) 244 CLR 638; [2012] HCA 1 applied. A sentencing judge was entitled to take into account the actual mental condition of the offender, but not presumed distress and anxiety, pursuant to s 16A(2)(m) of the Crimes Act: [40], [43]. Bui v Director of Public Prosecutions (Cth) (2012) 244 CLR 638; [2012] HCA 1; Director of Public Prosecutions (Cth) v De La Rosa (2010) 79 NSWLR 1; [2010] NSWCCA 192 applied.
2. The general law principle that hardship to family members will not operate to reduce the appropriate sentence unless the circumstances are "exceptional" is not consistent with the language of s 16A(2)(p) of the Crimes Act. It may be that cases seeking to apply the general law principle in relation to federal offences have adopted an unwarranted gloss on the statute: [49] and [60]. R v Zerafa [2013] NSWCCA 222 discussed. The sentencing judge erred, not in failing to make a finding that the hardship involved "exceptional" circumstances, but in relying on hardship to the offender's daughters in circumstances where the evidence did not establish that imprisonment of the offender would significantly and deleteriously affect their lives: [63].
3. The sentencing judge erred in favour of the offender in assuming that the tax liabilities had been met, the assumption being erroneous: [68].
4. The sentencing judge erred in treating the offender as entitled to the leniency granted to a first-time offender in sentencing for offences which were not the first offence committed, merely because he had not been convicted for the earlier offence. Further, there was indeed an earlier conviction which limited the leniency which should have been allowed: [73]. The correct approach required that the sentencing court take into account the character and antecedents of the offender, pursuant to s 16A(2)(m).
5. Delay is not of itself a basis for mitigating the severity of a sentence, which should not be reduced as an expression of disapproval of the conduct of the prosecutor: [100]. The period of time between the commencement of criminal proceedings and the final sentencing was 6 years, of which only a minor part could be attributed to unreasonable conduct on the part of the prosecution: [105].
6. Material errors in sentencing the offender on the tax offences supported the conclusion that the sentences imposed, including the degree of accumulation and the resulting non-parole period, were manifestly inadequate: [114]. In considering the Court's discretion not to intervene, it is appropriate to bear in mind the principle of restraint as it applies to resentencing after a second conviction for the same offence: [119]. The circumstances did not warrant a course other than setting aside the sentences imposed and resentencing the offender: [121].
7. With respect to the contravention of the Proceeds of Crime Act, the sentencing judge erred in considering (a) the operation of s 16A(2)(m) of the Crimes Act by reference to prior convictions at the date of the offending: [132]; (b) the fact that the offender had not been sentenced for a considerable period of time after the offending occurred: [141]; and (c) the possibility that the matter could have been dealt with in a lower court, in circumstances where the offence was the breach of an order made by a judge of the Supreme Court: [145].
8. The Court held that intervention was warranted - at [148] - and the offender was resentenced.

Judgment

1. BASTEN JA: On 9 September 2015 the respondent, Timothy Charles Pratten, was found guilty by a jury on seven counts of obtaining a financial advantage by deception, contrary to s 134.2(1) of the Criminal Code (Cth). Each of the charges related to a failure to disclose income in a particular tax year, with a resultant reduction in the tax payable. The respondent was sentenced on the basis that the total amount which was not disclosed was about $5 million and the value of the benefit in unpaid tax was a little over $2 million.
2. Counts 1 and 2 related to financial years ending 30 June 2003 and 30 June 2004 respectively, each return being lodged on 18 August 2005. Count 3, relating to the financial year ending 30 June 2005 was lodged on 21 June 2006. Counts 4-7, relating to the four subsequent financial years, were all lodged on 29 September 2009. The bulk of undisclosed income, totalling a little over $3 million, was in the financial years ending in 2006, 2007 and 2008.
3. On 29 April 2016, the trial judge, Rothman J, imposed sentences of 3 years imprisonment for each of counts 1, 2 and 3, to be served concurrently and commencing on 20 January 2016. [1] On each of counts 4-7, a sentence of 4 years imprisonment was imposed, the sentences to be served concurrently with each other but partly accumulated on the earlier sentences, commencing a year later, on 20 January 2017. The result was a total sentence period of 5 years imprisonment; the judge fixed a non-parole period of 2 years, to expire on 19 January 2018.
4. On 1 June 2016, the Commonwealth Director of Public Prosecutions gave notice of intention to appeal on the ground that the sentences were manifestly inadequate; specific errors were also relied upon. For the reasons which follow, the appeal should be allowed and the respondent resentenced.

Grounds of appeal

1. The individual grounds were as follows: "3 The learned sentencing judge erred by taking into account the 'fact of re-sentencing, and the effect of "double jeopardy"' the effect of which led his Honour, in part, to impose an 'unusually short non-parole period'. [2] 4. His Honour erred in finding that hardship caused to the Respondent's two daughters warranted consideration in mitigation of sentence. [3] 5. His Honour erred in assuming that tax liabilities had been repaid in the absence of any evidentiary foundation for such an assumption. [4] 6. His Honour erred in finding that the Respondent had no prior criminal record and '[wa]s entitled to the leniency associated with a first-time offender'." [5]
2. Manifest inadequacy, in two respects, was alleged in grounds 1 and 2: "1. The sentence imposed in respect of each of charges 1-7 was manifestly inadequate. 2. The overall effective sentence and resulting non-parole period was manifestly inadequate by reason of inadequate accumulation."
3. The key elements of each charge were resolved by the jury verdicts; however, as the sentencing judge noted, other aspects of the respondent's conduct were not resolved by the verdicts and required findings of fact, which he duly made. It is convenient to commence by addressing the specific grounds 3-6 relied upon by the Director, before addressing the broad complaints of manifest inadequacy identified in grounds 1 and 2.
4. Each of the offences carried a maximum term of 10 years imprisonment, and a fine of $66,000. [6] Further, there was an unchallenged finding that "the conduct of the offender [was] objectively above the mid-range in seriousness." [7]

Conduct the subject of the charges

1. The respondent, from a date prior to the 2003 financial year (the subject of count 1), had engaged in the sale of insurance through a company, Rural & General Insurance Ltd. The trial judge noted that the Commonwealth had passed legislation, commencing in 2002, increasing the regulatory requirements for carrying on insurance, in the wake of the collapse of HIH Insurance. [8] The respondent then changed his business operation, incorporating an insurer in Vanuatu. That company, originally known as Rural & General International Insurance Ltd, changed its name in March 2005 to Commercial Pacific Insurance Ltd. From 2000, the respondent acted as an insurance broker in Australia through a company, Presidential Financial Services Pty Ltd, which changed its name in August 2002 to Rural & General Insurance Broking Pty Ltd. During the relevant tax years, the broker collected premiums in excess of $19 million which were remitted to one of two trust companies in Vanuatu. [9] The broker charged a fee of 33% of the net premiums received, [10] of which an amount in excess of $4.5 million, according to the Director's case, was paid to the respondent, or at his direction for his own use, but not declared by him as income in the relevant financial years.
2. Certain factual issues, additional to the elements inherent in the jury verdicts, were determined by the trial judge, in the following terms: "[88] The Crown has discharged its onus of proving beyond reasonable doubt that the amounts alleged in its closing address were income and displacing any reasonable hypothesis that moneys were loans. … [95] As a consequence of the foregoing, I accept the allegation of the Crown in its entirety as put in its closing address and as submitted during the course of the sentencing proceedings. With the exception of the first five payments in 2002, relating to a period during which it seems the Broking Company was operating but the Vanuatu insurer had not been incorporated, the amounts received and paid for the benefit of the offender are income in the ordinary sense. … [99] The offender's evidence discloses that the offender was not under any mistaken view as to the operations of companies with which he was associated or with which he dealt. The offender's evidence also disclosed that the offender set upon a deliberate course of conduct in the expectation that, by returning the moneys and calling them loans, he could escape a considerable amount of income tax. This course was neither accidental nor lacking dishonesty. [100] It is also clear from his evidence that the offender lacks any remorse and was prepared to dissemble and give explanations that he knew to be incorrect in order to avoid the consequences of his conduct. I consider his prospects of rehabilitation poor, as he rationalises his conduct and considers he has done nothing wrong. … [102] The Crown submits that the offender was an instigator of the plan. I am not satisfied, to the requisite standard, that when first initiated, the offender undertook this activity otherwise than on the basis of advice from accountants. I am not, in those circumstances, prepared to accept, in its totality, that particular submission of the Crown. [103] However, when the offender changed accountants in 2004 from BDO Vanuatu to PKF Vanuatu, it is clear from the communications that it was he, not PKF, that explained the workings of the company and the manner in which control was effected. At least from 2004 and in relation to the alteration to PKF Vanuatu, it is clear that the offender was one of the instigators and deliberately set upon a course that continued the planned, deliberate and intended dishonesty."

Procedural background

1. This case has a significant procedural history, aspects of which were taken into account by the trial judge in sentencing the respondent. The following aspects of the chronology were important.
2. First, although the income tax returns for the last four years (financial years ending on 30 June 2006, 2007, 2008 and 2009) were lodged on 29 September 2009, search warrants had already been executed at the respondent's business and residential premises on 3 December 2008. The respondent was arrested on 22 September 2010. He was released on bail.
3. Secondly, the respondent having been granted bail following his arrest, his first trial commenced on 21 March 2012 (some 18 months after his arrest). The trial was lengthy, the jury returning its verdicts on 13 June 2012. There was then an extended period before the hearing of the sentence proceedings (in March 2013), sentences being imposed a year later on 31 March 2014. During that period, the respondent took various steps, including obtaining an adjournment following a change in his legal representation; filing proceedings seeking declaratory and other relief after his conviction but before he was sentenced, and lodging an appeal against conviction on 15 August 2013, that is, after the sentencing hearing but before he was sentenced.
4. On 4 April 2014, following the judgment on sentence, the Director filed a notice of appeal challenging the adequacy of those sentences. On 1 July 2014 this Court upheld the respondent's appeal, setting aside the convictions and ordering a new trial. Consequently, the Director's appeal against the sentences was dismissed without consideration of its merit. The respondent was released on bail, after serving some 93 days in custody.
5. Following further interlocutory steps over the next 12 months, the second trial commenced before Rothman J on 13 July 2015. On 9 September 2015 the jury delivered its verdict, finding the respondent guilty on all seven counts.
6. A further sentence hearing took place on 27 October 2015. There was then a further delay, in part due to the illness of the trial judge. The sentences presently under review were imposed on 29 April 2016. The back-dating of the commencement date to 20 January 2016 accommodated the need to give credit for the periods served in custody following his arrest and the first sentencing. [11]
7. The trial judge did not seek to apportion responsibility for the significant procedural delays, but expressly stated that he took into account the fact that the respondent had been subject to conditional liberty for more than 5.5 years since the time of his arrest.

Ground 3 - double jeopardy

1. Dealing with the specific grounds, the critical passage in the judgment on sentence challenged by ground 3 read as follows: [12] "I impose a sentence that is, given the subjective circumstances of the offender and the objective circumstances of the offence, at the lowest end of the range I consider appropriate and available. I also take into account the illness, the delay and the other subjective circumstances in fixing an unusually short non-parole period, given the length of the head sentence. In part, this has been effected also because of the fact of re-sentencing, and the effect of 'double jeopardy'."
2. There was no challenge to the propriety of taking into account illness, delay and other subjective circumstances in fixing the non-parole period. There were, however, three elements in this passage which were controversial. The first was the reference to setting a sentence "at the lowest end of the range"; the second concerned giving effect to "the fact of resentencing" and the third, giving effect to "double jeopardy".
3. There may be some uncertainty as to the import of the last sentence in this passage and how precisely the trial judge took into account "the fact of re-sentencing" and what he described as "double jeopardy". In an earlier passage the judge had stated a "prima facie position" that on resentencing following a re-trial, the Court should not impose a sentence greater than the sentence imposed on the first trial. [13] He noted that the prima facie position may be "displaced only on rare occasions, when the evidence is substantially different or the first sentence imposed was manifestly inadequate."
4. Without appellate intervention, it may be difficult to persuade a trial judge that the sentences he or she had originally imposed were "manifestly inadequate". Although the Director had filed an appeal against the inadequacy of the original sentences, that appeal was not determined by this Court, once it was satisfied that the convictions were to be set aside. In any event, the judge did not deal with the matter on that basis but stated: [14] "In my view, the evidence in this second trial is significantly different from that which was adduced in the first trial. If I am wrong, then I had misunderstood the nature of the evidence adduced in the first trial and the sentence imposed would, if the evidence were the same as that adduced in this trial, be manifestly inadequate."
5. It was clear from this passage that the trial judge accepted that there was a principle of restraint inhibiting the imposition, following a conviction at a second trial, of a sentence higher than that imposed for the same offence at the earlier trial. [15] Nevertheless, he held that it was appropriate to depart from that rule in the present case. On appeal, the Director did not directly challenge the applicability of the principle, because she accepted that the judge was correct not to apply such a constraint in the present case. However, in order to assess the Director's challenges, it is necessary to consider the principle and its operation with respect to federal offences. As noted by the High Court in Bui v Director of Public Prosecutions (Cth), [16] the concept of "double jeopardy" may mean different things in different contexts. Arguably the concept is reflected in the principle constraining resentencing after a second trial. [17] If that is so, the sentencing judge may have been stating no more than that, even in the exceptional case where the principle did not apply, the underlying policy nevertheless remained relevant.
6. The Director did not suggest that the judge was in error in imposing a more severe sentence than had been imposed after the first trial; rather, she challenged the proposition that it was appropriate to set the level of severity "at the lowest possible level within the range of appropriate sentences".
7. This language risks engaging the fallacy identified by Simpson J in R v Blundell, [18] namely that there is both a range of sentences available to a trial judge and at the same time an obligation to impose the least severe sentence. [19] The difficulties raised by this language extend beyond illogicality. One is that neither the sentence nor the relevant range of sentences can helpfully be determined by excluding a material factor. Usually, identifying a sentence in stages should only be undertaken when a statute requires that there be a staged process, such as a proportionate reduction for a plea of guilty.
8. Identifying a range is generally an exercise undertaken by an appellate court, recognising that usually there will be no precisely correct sentence and that varying sentences may be imposed by the sentencing court in a particular case, without demonstrating appellable error. The task for the sentencing judge is somewhat different: it is to determine a specific sentence which, in his or her view, properly reflects all the relevant circumstances of the case. So much is reflected in the language of s 16A(1) of the Crimes Act 1914 (Cth) which provides: 16A(1) In determining the sentence to be passed … in respect of any person for a federal offence, a court must impose a sentence … that is of a severity appropriate in all the circumstances of the offence.
9. Nevertheless, identification of a range may be an exercise required of a sentencing judge following a retrial and second conviction. The reason why that is so lies in explanations of the principle of restraint, discussed in R H McL v The Queen. In that case, Gleeson CJ, Gaudron and Callinan JJ said, in relation to a resentencing following conviction at a second trial: [20] "In brief, in the absence of countervailing considerations, the sentences imposed following the first trial should be regarded as the upper limit of the sentence to be imposed following the second trial, otherwise an offender will be seen to have been worse off as a result of having brought a successful appeal against a conviction. The weight to be given to that consideration depends, of course, upon the circumstances of the individual case."
10. In a separate judgment, McHugh, Gummow and Hayne JJ noted that it was open to the judge undertaking the second sentencing exercise to impose a greater sentence if of the view that the original sentence was manifestly inadequate. [21] For the same public policy reason as expressed in the other joint reasons, they said that such cases should be rare, thereby implying an obligation of restraint upon the sentencing judge on the second occasion in reassessing the sentence imposed following the first trial.
11. Kirby J in R H McL (albeit dissenting as to the result) adopted the following statement of principle by the Queensland Court of Appeal in R v Petersen: [22] "We consider that where an offender is to be re-sentenced following a successful appeal and re-trial, the second sentencing Judge should start with the proposition that the offender ought, in general, not receive a harsher sentence than that imposed after the first trial. If minded to depart from that approach, he or she should consider the powerful policy considerations outlined above. Only if the second sentencing Judge concludes that the earlier sentence was outside the appropriate range, or the facts as they appear at the time of the re-sentence are significantly different from those upon which the first sentence was based, should he or she impose a heavier sentence."
12. The last sentence in the extract from Petersen recognises that the task of the second sentencing judge may be similar to that of an appeal court. That approach has been followed both at first instance and on appeal in this State: see R v Hannes, [23] Tarrant v The Queen [24] and Giotas v R. [25]
13. The next question is whether these principles apply in sentencing an offender under s 16A of the Crimes Act, following a second trial for federal offences.
14. Statutory provisions, like s 16A of the Crimes Act, which do not purport to deal exclusively with a particular topic, require, as a process of construction, an understanding of the extent to which they reflect extant judicially approved principles and the extent to which they modify such principles. That exercise is unremarkable. However, the exercise of statutory construction involves a consideration of the extent that, prior to the Commonwealth legislation, the laws of the state or territory in which an offence was prosecuted were applicable, by virtue of ss 68, 79 and 80 of the Judiciary Act 1903 (Cth). Because it has been held that the term "conviction" in s 68(2) includes a finding of guilt or acceptance of a plea of guilty, followed by sentence, s 68 itself was probably sufficient to pick up and apply state law with respect to sentencing. [26] However, it was also accepted that s 68 should be understood as if it included an exception where the Constitution or laws of the Commonwealth otherwise provide. Prior to the commencement of the amendments which introduced Pt 1B into the Crimes Act, [27] and subject to specific provision previously made by the Commonwealth Prisoners Act 1967 (Cth), federal offenders were sentenced in accordance with the procedures and sentencing principles applicable in the state or territory in which the sentencing occurred. Broadly speaking, uniformity was achieved with the state jurisdiction, with the concomitant potential for disparity in the treatment of federal offenders in different jurisdictions. One purpose of the new scheme in Pt 1B, which commenced in 1990, was to create a single set of sentencing principles which could be applied uniformly to federal offenders in all jurisdictions. That change in philosophy, from disparity to national uniformity, makes it difficult to be sure whether the new provisions were intended to reflect or modify the preceding laws.
15. As first enacted, the scheme of Pt 1B was not comprehensive. Gleeson CJ noted in Putland v The Queen at [12], referring to the decision of this Court in Director of Public Prosecutions (Cth) v El Karhani, [28] that there was no reference then to general deterrence in the list of matters to be taken into account in s 16A(2). [29]
16. In Johnson v The Queen, [30] the High Court accepted that a sentencing judge had been in error in failing to apply sentencing principles established under the common law of Australia. [31] As explained in the joint reasons: "The proposition [that it was an error to fail to supplement the provisions of Pt 1B by the common law] is largely uncontroversial: that except to the extent stated in ss 16A and 16B of the Act, general common law and not peculiarly local or state statutory principles of sentencing are applicable. That common law principles may apply follows from the use of the words 'of a severity appropriate in all the circumstances of the offence …' in s 16A(1) and the introductory words 'In addition to any other matters ...' to s 16A(2) of the Act."
17. It was the scope of the exception which has proved controversial. First, there remained a question in particular cases as to whether the general law principle sought to be relied on was inconsistent with the statutory provisions in the Crimes Act. Secondly, there was a question as to what constituted a "peculiarly local or state statutory principle". Thirdly, there was a question as to what was to be identified as a general common law principle, in circumstances where particular principles had been modified by statute, perhaps in several jurisdictions.
18. It is necessary to address the scope of the exceptions in order to know whether the sentencing judge erred in giving effect to the principle of double jeopardy.
19. The enactment of Pt 1B of the Crimes Act was greeted with a level of judicial frustration in some quarters: see for example the remarks of Hunt J in R v Paull, [32] echoed by this Court in El Karhani. [33] However, the initial willingness of the High Court to look outside the statute, appears to have been tempered in recent cases. The preferred course is to look first to the federal statute. Thus, in Hili v The Queen [34] the Court said that, "[f]or the most part, the relevant statutory provisions that were to be applied in sentencing the applicants are to be found in Pt 1B of the Crimes Act." Because the laws of the states with respect to the sentencing of offenders could have no operation with respect to the sentencing of offenders against laws of the Commonwealth of their own force, the Court noted that any relevant operation was because s 68 of the Judiciary Act picked up the relevant state law and applied it as federal law. The Court in Hili held that Pt 1B made exhaustive provision for fixing non-parole periods and that it was therefore erroneous to adopt a practice of fixing a non-parole period as between 60% and 66% of the total sentence. [35]
20. In addition to considering whether state law was picked up by s 68 of the Judiciary Act, the Court acknowledged that Pt 1B itself "on its proper construction, accommodates the application of common law principles of sentencing" [36] and in particular that: "Section 16A accommodates the application of [the principle of totality] and some other judicially developed general sentencing principles because those principles give relevant content to the statutory expression 'of a severity appropriate in all the circumstances of the offence' used in s 16A(1), as well as some of the expressions used in s 16A(2), such as 'the need to ensure that the person is adequately punished for the offence' (s 16A(2)(k))."
21. The issue in Bui v DPP [37] was whether the Victorian Court of Appeal had erred in applying a state statute which forbad the appeal court, when resentencing, taking into account any element of double jeopardy. [38] The element of double jeopardy was identified as "the presumed distress and anxiety" occasioned by having to face a second sentencing for the one offence. The High Court held the rule against double jeopardy "is properly understood as a value which underpins the criminal law." [39] It was, however, only if the common law principle itself otherwise applied that the statutory exclusion under state law would be engaged. The Court therefore addressed the operation of the common law principle as the first question to be determined.
22. The High Court distinguished R v Tait, [40] where the Full Federal Court had applied the principle, but in the absence of any equivalent to Pt 1B of the Crimes Act. [41] Echoing Hili, the Court said that s 16A "accommodates the application of some common law principles of sentencing". [42] However, neither the opening words, requiring that the sentence be of "a severity appropriate in all the circumstances of the offence", [43] nor the opening words of s 16A(2), "[i]n addition to any other matters" were sufficiently broad to pick up a principle which was said to give rise to an automatic "discount" or reduction of the sentence. [44] The generality of s 16A was also found to be inconsistent with the accommodation of a principle said to apply only to appellate resentencing. It would be a bold conclusion for a single judge (or this Court) to find that the conclusion reached in Bui was nevertheless only applicable to a resentencing after a second trial.
23. There remained a question whether presumed distress and anxiety could be taken into account under s 16A(2)(m), which refers to "the physical or mental condition" of the offender. However, the Court held that that provision was limited to "the actual mental condition of a person, not his or her presumed condition", [45] upholding the approach of Simpson J in Director of Public Prosecutions (Cth) v De La Rosa, [46] stating that par (m) "referred to the actual mental condition of a person, not his or her presumed condition and that a condition of distress or anxiety must be demonstrated before the provision applies." [47]
24. Finally, there was said to be a question whether, if s 16A did not itself provide for ("accommodate") the common law principle, it might be picked up by s 68 or s 80 of the Judiciary Act (the joint reasons focused on s 80) and applied as part of the relevant federal law. The Court rejected that possibility on the basis that there was no relevant gap or omission to be filled by state law. [48]
25. Given that s 16A(2) listed factors non-exhaustively, the question might have been whether the general law principle was inconsistent with the terms of the section. In fact, none of this mattered because the only law which might have been picked up was the law of Victoria which had excluded the general law principle.
26. Despite some uncertainty as to the scope of the reasoning in Bui, it is not open to this Court (or to the sentencing judge) to treat "double jeopardy" as a relevant consideration, involving the reduction of the sentence which would otherwise have been imposed, in resentencing for a federal offence.
27. Although ground 3 correctly identified error in the approach adopted by the trial judge, there was no explicit statement in the reasons for sentencing as to any particular reduction achieved by these considerations, nor should there have been. Had these been the only errors, there would have been much to say for the view that the Court, in the exercise of its residual discretion, should not intervene. That is because the sentencing judge, having made several references to the effect of delay and the effect that that must have had on the respondent, may well have given little weight to the further erroneous considerations. However, for the reasons addressed below, these were not the only challenges made good by the Director.

Hardship to respondent's daughters

1. The Director challenged the following passage in the judgment on sentence: [49] "The delay in imposing a sentence means that each of the daughters is now older and, subject to ill health, capable of living independently. Nevertheless, I accept that the hardship caused to the offender's two daughters warrants consideration in mitigation of sentence, particularly given the state of health of one of them."
2. A second passage relied on by the Director merely referred back to the earlier statement that the judge had taken into account "the offender's health and the effect on his family." [50]
3. Section 16A(2)(p) requires the Court to take into account, to the extent that the matter is relevant and known to the Court: "(p) the probable effect that any sentence or order under consideration would have on any of the person's family or dependants."
4. Very soon after the enactment of s 16A intermediate courts of appeal held that par (p) was intended to reflect principles established under the general law, namely that hardship to a family member, resulting from the imposition of a sentence of imprisonment on the offender, could only be relied on to reduce the sentence in circumstances which were "exceptional". [51]
5. That approach has been treated as settled in this State, following the judgment of Spigelman CJ in R v Togias. [52] The case-law, both in this Court and in other intermediate courts of appeal, was carefully reviewed by Beech-Jones J in R v Zerafa. [53] However, as Beech-Jones J explained, despite the weight of authority supporting Togias, there have been expressions of disquiet that the approach adopted under the common law involves a reading down of the Commonwealth statute in a manner which finds no basis in the statutory language. Indeed, the trial judge in Zerafa (Simpson J) had herself expressed the same disquiet whilst accepting that binding authority required that the general law principle be applied. [54]
6. The consideration stated in par (p) is unusual in several respects. First, it focuses not on the nature of the offending, or the effect on the victim, or on the circumstances of the offender, but on third persons, uninvolved in the offending, namely the offender's family or dependants. This is a factor which has encouraged sentencing courts to address the consideration with circumspection. It makes sense to delimit the circumstances in which such extraneous considerations should properly reduce the sentence which would otherwise be imposed.
7. Indeed, par (p) contains its own internal constraint in that, unlike the other factors to be considered, it requires the court to refer to "the probable effect" that the sentence may have on family or dependants.
8. Secondly, although not uniquely, the consideration operates in one direction only, namely to provide a basis for reducing the sentence.
9. Thirdly, as Beech-Jones J further explained in Zerafa, one difficulty with the application of the general law principle is its uncertain scope. [55] Whether particular circumstances are characterised as exceptional or unexceptional may depend upon the frame of reference within which they are assessed. For example, the most common situation in which reliance is sought to be placed on such considerations will involve an offender who is the primary caregiver for young children or others who are not capable of looking after themselves. The Australian Law Reform Commission, in its 2006 Report on sentencing of federal offenders, noted a submission that "85% of women who are incarcerated are the primary caregivers of their children." [56] Thus, amongst women prisoners, the circumstance relied upon might be quite unexceptional; amongst the prison population as a whole, primary caregivers may constitute a small proportion.
10. Three further points may be made by way of expansion of the reasoning of Beech-Jones J. The first is that the leading case with respect to the general law applicable in this State is the judgment of Gleeson CJ (James and Ireland JJ agreeing) in R v Edwards. [57] Ms Edwards pleaded guilty to the manslaughter of a man with whom she had had a long standing if stormy relationship. The sentencing judge (Simpson J) accepted that no penalty other than fulltime custody would have been considered, but for a particular circumstance, namely that it would deprive a patient in a mental health institution from the care and attention which the offender had successfully been providing to him for some years. The Court of Criminal Appeal concluded that the judge had erred in failing to impose a custodial sentence.
11. If the case were seen as authority for the proposition that only exceptional circumstances would warrant a truly exceptional degree of leniency, no contrary argument could be raised. The conclusion expressed by the Chief Justice was that "Simpson J was in error in permitting the consequence to a third party to deflect her from imposing the sentence of fulltime imprisonment, which she plainly indicated she would otherwise have imposed." [58] However, it does not follow that no degree of mitigation can be allowed unless the circumstances are truly exceptional. The fact that the exclusion of consideration of the effect on third parties is expressed in qualified terms indicates that the law does not treat such consequences as irrelevant in all circumstances. Why, in that case, it should deny a sentencing judge the flexibility to adopt a proportionate response is obscure.
12. The second feature of Edwards is that Gleeson CJ expressly referred to the Commonwealth legislation (and its equivalent in South Australia). [59] At the end of the discussion, the Chief Justice noted that "[t]here is no such legislation applicable in the present case." At the very least, that left open the possibility that a different approach would be required under such a statute.
13. Thirdly, it is proper to note the changes in the approach to statutory interpretation which have occurred over the last 25 years. Thus, when the Western Australian Court of Criminal Appeal concluded in 1990 that s 16A(2) was not intended to alter the common law in this regard, little attention was given to the precise wording of the section. That is not the approach which would now operate. The approach to s 16A adopted by the High Court in Hili v The Queen and in Bui v DPP gave careful attention to the manner in which general law principles were "accommodated" by the language of Pt 1B of the Crimes Act, or picked up by s 68 or s 80 of the Judiciary Act, for the purpose of the exercise of federal jurisdiction. [60] As the High Court explained in Bui, it is one thing to read the language of s 16A as accommodating general law principles in order to identify the severity of the penalty appropriate in the circumstances of the offence; it is quite another to place a limitation upon an expressly stated consideration where the limitation is not found in the statute, but can only arise under the general law.
14. The approach preferred by Beech-Jones J was adopted by the Queensland Court of Appeal (without reference to other judicial statements) in a matter involving the application of s 16A of the Crimes Act, namely R v Ruha; Ex parte Director of Public Prosecutions (Cth). [61] Thus at [59] the Court said: "The hardship which would necessarily be suffered by members of Roland Ruha's family upon his imprisonment must be taken into account under s 16A(2)(p) of the Crimes Act, but in the context of the seriousness of his offence it was not of such a degree as to justify substantial mitigation."
15. Although this aspect of the reasoning in Ruha was not in issue in Hili in the High Court, the Court otherwise agreed with the approach to the construction of s 16A adopted in Ruha. [62]
16. In the circumstances of this case, it is not necessary to decide whether this Court should now follow the reasoning of Beech-Jones J in Zerafa. Although it appears that counsel for the respondent invited the sentencing judge to approach the matter without relying upon a gloss of exceptional circumstances, that submission was not repeated in this Court, counsel accepting that exceptional circumstances were required and, on the evidence, had not been established. However, he sought to support the approach taken by the trial judge on the basis that the Court had been entitled to take the factor into account in setting "an unusually short non-parole period". [63]
17. That approach cannot be accepted; the fixing of a non-parole period is as much a part of a sentence as is the nomination of the full term. The submission sought to rely on the proposition derived from King v R [64] where, after referring to the principle in Edwards in relation to hardship to the offender's family, Price J stated: "There are circumstances, however, that whilst not sufficiently exceptional to justify a non-custodial sentence are sufficiently exceptional in a suitable case to justify a finding of special circumstances: R v Grbin; [65] R v Murphy. [66] "
18. The language adopted in King reflected that of Dunford J in Grbin at [30], also that of Buddin J in Murphy at [16]. Each of these cases purported to apply the Edwards principle, but in each it was assumed to permit a flexible approach allowing proportionate adjustments to part of the sentence. If, on the other hand, those cases are properly understood as applying a different approach in fixing the relationship between the non-parole period and the balance of term, pursuant to s 44 of the Crimes (Sentencing Procedure) Act 1999 (NSW), then it is necessary to ask how the principles applicable under the state statute come to be applied in federal jurisdiction. Although the matter was not addressed in argument, the non-parole period is to be fixed under the federal law [67] which contains no equivalent to s 44 in the NSW legislation. Nor is there any scope for adopting principles applicable to the exercise of discretion under s 44 for the purposes of the different statutory scheme under the Commonwealth law.
19. It follows from this reasoning that the trial judge was in error in taking into account, as a factor mitigating the length of the sentence, the effect of the sentence on the respondent's family. This was not merely a failure to state a finding of fact, namely that the circumstances were exceptional, but was wrong because the evidence, whilst establishing that each of the respondent's daughters had serious problems, did not establish that the offender's imprisonment would significantly and deleteriously affect their lives.
20. Again, however, the extent to which this factor operated in the sentencing process is hard to evaluate. If the overall sentence or the non-parole period might be seen to be manifestly inadequate, this is a factor which may partly explain the inadequacy.

Ground 5 - assumption of payment of tax

1. In considering the "subjective circumstances" of the respondent, the trial judge made an assumption that the tax liability had been satisfied. On appeal, the respondent accepted that the assumption was erroneous, but contended that it played little part in the judge's reasoning which, in the same paragraph, referred to the amended assessments and the levy of tax penalties. The judge continued: [68] "The penalties are an extra curial punishment, but not for dishonesty or deception which are the gravamen of these offences. Nevertheless, I take some account of that extra curial penalty in setting an appropriate sentence."
2. Rather than diminishing the significance of the error, that passage tends to accentuate it. That is, the judge took into account not only tax which had not been paid on the assessable income, but also the imposition of the tax penalty, even though that also had not been paid. In any event, the consideration cannot be dismissed as the respondent contends: the payment of the full tax liability would have been a strong factor mitigating the seriousness of the offender's conduct. It would, no doubt, also have formed a basis for a favourable finding with respect to remorse and rehabilitation. However, as noted above, the judge expressly found that the respondent lacked any remorse and considered his prospects of rehabilitation poor. Despite those findings, the assumption that tax had been paid must have significantly lessened the severity of the sentence imposed.
3. In oral submissions the respondent said that he could not be expected to have paid the tax in circumstances where he disputed (and continued to dispute) the extent of his liability. Although there was no evidence before the Court, he asserted that there were proceedings on foot in the Administrative Appeals Tribunal involving his objections to the assessments.
4. Accepting the correctness of each of the factual assertions, they go no further than to confirm the erroneous assumption made by the trial judge. They do nothing to undermine the fact that the erroneous assumption was favourable to the respondent and must have been a significant mitigating factor in the mind of the sentencing judge. This ground is made good and would warrant intervention by the Court in the exercise of its discretion.

Ground 6 - prior criminal record

1. The trial judge observed, as the last element under the heading "subjective circumstances": [69] "As earlier stated, the offender has no prior criminal record and is entitled to the leniency associated with a first-time offender."
2. If some earlier discussion of the respondent's record had been intended, it was not included. There is a degree of temporal ambiguity in the reference to "no prior criminal record", but it was factually inaccurate on any view. The respondent submitted that the offences revealed in a certificate of conviction tendered as part of the prosecution case on sentence, related to conduct which post-dated the offences for which the respondent was then to be sentenced. However, that submission was not entirely accurate. The offences related to failing or refusing to file tax returns when required to do so. Although the convictions occurred on 11 November 2009, the offences took place on six dates between 13 May 2008 and 15 May 2009. That is, they pre-dated the lodgement of the tax returns lodged on 29 September 2009, which gave rise to counts 4-7 on the indictment. Further, as the Director had noted in written submissions on sentence, the respondent had a previous conviction for failing to comply with his taxation obligations in 1997.
3. The proper approach to this ground is not to seek to resolve the possible ambiguity in the reasons of the trial judge. Rather, it requires attention to the elements of s 16A(2)(m), identifying as matters to be taken into account "the character" and "antecedents" of the offender. Although the judge relied upon the lack of a prior criminal record as entitling the respondent to "the leniency associated with a first-time offender," leniency does not apply to all of the offences committed by a serial offender merely because, when the last offence was committed, he had not been convicted for any earlier offence. [70] Quite apart from the convictions for failing to lodge tax returns, the fact that the convictions involved repeated offences of dishonesty over seven years disentitled the respondent to any leniency in respect of the later offences. The earlier offences were proved beyond reasonable doubt by the jury verdicts.
4. The trial judge was not satisfied that the respondent was the instigator of the plan in relation to the first three offences, as opposed to acting on the basis of advice from his accountants. [71] However, the judge accepted that "[a]t least from 2004 … it is clear that the offender was one of the instigators and deliberately set upon a course that continued the planned, deliberate and intended dishonesty." [72]
5. Accepting that there was reason to accord leniency in respect of the earliest offending, there was no reason to accord any degree of leniency with respect to the last four counts. [73] Although the trial judge distinguished the sentences for counts 1-3 from those for counts 4-7, it does not appear that he did so on this basis. That is, the observations with respect to the lack of a prior criminal record appear to have applied with respect to all the charges. This was an erroneous approach which at least engaged the Court's discretionary power to intervene.

Manifest inadequacy

1. It is convenient to deal with appeal grounds 1 and 2 together. Ground 1 alleged manifest inadequacy in respect of the sentences imposed on each count, whilst ground 2 alleged manifest inadequacy as a result of inadequate accumulation and, as a further result, inadequacy in the non-parole period.

(a) objective seriousness

1. The analysis of the trial judge in relation to the objective circumstances of the offences, which has been set out above, was not challenged and should be accepted. The conclusion that the conduct of the offender was "objectively above the mid-range in seriousness" should also be accepted.
2. The trial judge (correctly) treated the first three offences as warranting less severe sentences than counts 4-7. The primary basis for that approach was that the initial arrangements were undertaken on the basis of advice from accountants. That ameliorating factor, to the extent that it had weight, did not apply to counts 4-7. It would have been reasonable to allow some moderate element of leniency in respect of the first two offences, the returns being lodged together, despite the fact that they involved a deliberate course of dishonesty. (Although he had a prior taxation offence, there was no suggestion that it involved dishonesty.) Further, it is clear that offending which continued over seven years, in circumstances where the larger amounts were not disclosed in the period of three years covered by counts 4, 5, and 6, averaging $1 million in each of those years, demonstrated a higher level of objective seriousness in respect of those offences than in respect of the earlier offences.
3. The trial judge made reference to the amounts which were not disclosed and the financial advantage obtained by reason of the reduced tax assessments, in determining the objective seriousness of the offending, but said only that "these offences, committed over a significant period, depend less on the amounts received than on the nature of the criminal conduct in receiving them." [74] That there was an extended period of dishonesty, which was highly significant in considering the severity of the appropriate sentences, should not be doubted; on the other hand, the amounts involved were large, that being a factor which also required attention. In R v Alimic, [75] the Victorian Court of Appeal considered sentences imposed for federal offences including numerous counts of social security fraud and benefits obtained from filing false income tax returns. The amounts involved varied significantly, from a few hundred dollars through to almost $60,000. One ground of appeal asserted that the judge had failed to impose proportionate sentences, having regard to the disparate amounts involved. Nettle JA (with whom Warren CJ and Redlich JA agreed) stated: "[10] There is some force in that submission. Ordinarily in a case of this kind the relative gravity of offences of the sort in issue is to be assessed by reference to the amount of money involved in each offence. [76] Consequently, in this case one might have expected that there would be closer correlation between the amount of money involved in each offence and the sentence imposed in respect of the offence. … [11] That said however, the particular circumstances of a given case may sometimes warrant departure from the usual approach and in this case the circumstances appear to have been unusual. The amounts of money which were involved obviously had a role to play in the assessment of penalties but it seems that other considerations also informed the sentencing synthesis."
4. In expanding on the last point, Nettle JA noted that there were factors which explained the approach adopted, including the fact that "the modus operandi was similar throughout and, for that reason, the amount of money involved was not necessarily the natural discrimen of culpability." [77]
5. It is clear that weight has been given to the amounts involved in similar cases involving an offender defrauding the Commonwealth, a number of which were considered in Ruha at [60]-[71].
6. The present case involved sums well in excess of other cases where similar or higher sentences have been imposed. Thus, in Bick v The Queen [78] this Court dismissed an offender's appeal against a sentence of 4 years and 6 months with a non-parole period of 3 years and 6 months. There were 14 offences of fraudulently obtaining financial benefits from the Commonwealth in a sum of $309,351 over a period of almost 12 years. [79] In Murphy v The Queen [80] the offender was sentenced to 3 years and 3 months with a non-parole period of 2 years for offences involving some $376,000. In Ly v The Queen [81] a similar fraud involving $328,000 resulted in a sentence of 6 years imprisonment with a 4 year non-parole period.
7. Further, in Hili [82] this Court allowed an appeal by the Director in respect of a single sentence imposed on Mr Hili for evasion of company tax, resentencing him to a term of 3 years imprisonment with a minimum term of 18 months. His co-offender, Mr Jones, was given a similar sentence. According to the agreed facts, the financial loss to the ATO in respect of Hili's conduct was some $376,000 and that incurred with respect to Mr Jones' conduct was some $331,000. [83] The offenders neither devised nor organised the scheme and there were findings of genuine remorse and contrition and good prospects for rehabilitation in respect of each. Each entered a plea of guilty and obtained a discount of 50% for the plea and assistance to the authorities. That discount resulted from a concession and was not challenged on appeal. [84] The Court noted that the sentences were in effect much lower than those passed in two cases relied upon by the DPP, including Ly v The Queen.
8. These sentences were not overturned on appeal to the High Court. The joint reasons stated: [85] "The applicants' offending was sustained over a long time. It was planned, deliberate and deceitful, requiring for its implementation the telling of many lies. The applicants acted out of personal greed. The amount of tax evaded was not small. Detection of offending of this kind is not easy. Serious tax fraud, which this was, is offending that affects the whole community. As was pointed out in Ruha, [86] the sentences imposed had to have both a deterrent and a punitive effect, and those effects had to be reflected in the head sentences and the recognisance release orders that were made."

(b) personal circumstances

1. So far as the respondent's personal circumstances and attitudes were concerned, the finding of the trial judge that he lacked remorse and was "prepared to dissemble and give explanations that he knew to be incorrect in order to avoid the consequences of his conduct" should be accepted. [87] The judge's assessment of his prospects of rehabilitation as "poor" because he rationalised his conduct and did not consider that he had done anything wrong should also be accepted. These findings were not challenged.
2. The judge accepted evidence that the offender was suffering from depression. [88] The judge also appears to have accepted that one would expect a similar response from most white collar offenders and said that he "should have regular treatment for his psychiatric/psychological issues." There was no express finding that leniency should be accorded because he would find the circumstances of his incarceration more oppressive than would be the case for other offenders involved in such criminality. The judge continued: "Nevertheless, they disclose circumstances that would allow the community not to treat him in a manner that it would treat another offender not so afflicted."
3. It is by no means clear what the judge had in mind by this statement. He later said that "[n]otwithstanding his severe depression, I still consider that general deterrence is an important element." [89] On the other hand, he said that, although the offences warranted fulltime custodial sentences, he did not consider that specific deterrence was a "significant factor." [90]
4. The last statement was not expressly directed to his psychological state, and its significance is difficult to evaluate in circumstances where the respondent had shown a lack of remorse and had poor prospects of rehabilitation, because he believed he had done nothing wrong. On any sentencing exercise, it is clear that the respondent will return to the general community at an age and in circumstances where one may expect he will continue to seek out business opportunities. For such a person, who fails to appreciate the degree of criminality involved in his conduct the subject of the charges, specific deterrence must remain a significant element of the sentencing exercise.

(c) delay

1. There remained a procedural circumstance, upon which the sentencing judge placed some weight, namely the lapse of time between the offending conduct and the imposition of the sentences. The judge identified the nature of the delay at the forefront of his reasons in the following terms: "[5] As a consequence of the foregoing, there has been a regrettable delay in the passing of sentence on the offender. While, in some senses, the offender may have benefited, in that he was able to attend to certain personal issues that arose, that delay must be taken into account to his credit, as these matters have been hanging over his head for some significant period. [6] Nevertheless, the first substantial delay was caused by the investigation and finalisation of the case against the offender, the second delay between the first conviction and the passing of sentence was mostly caused by the offender himself, and the last delay from the time at which sentence was first imposed (31 March 2014) until today has been caused by errors made in the original trial, for which the offender is not responsible, and the unavailability of the Court."
2. The judge then dealt with the significance of the various elements of delay in the following passages: "[7] I take into account the entire period since the charging of the offender as a period during which the offender has been the subject of bail under conditions. While some of that time has been caused directly or indirectly by the collateral challenge to the original charges, during the whole of the period since 2010 the offender has been subject to bail (except for the 99 days during which he has been in prison) and I also take that period on bail into account in fixing an appropriate period of incarceration. I add that any account of the delay cannot lead to a sentence that is not, in all of the circumstances, appropriate. … [116] I am mindful of the delay that has been occasioned in the sentencing, as originally noted. … … [120] Nevertheless, as earlier stated, I take account of the delay. …"
3. In order to identify the relevance of "delay" in the sentencing process, it is necessary to identify salient factors in three categories, namely: 1. the beginning and end of the relevant period or periods; 2. the causes of such delay as may thus be identified, and 3. the consequences of the delay.
4. Dealing with the temporal element, it may be appropriate to look at the period which has elapsed from the commission of the offence until the date of sentencing. However, it will often be necessary to consider different periods within that overall timespan. For example, it may not be irrelevant that there was a lapse of years between the commission of the offence and the identification of potential criminality by the state. However, the significance of that period will depend very much upon whether the offence or the offender passed unnoticed, or whether the state had material to investigate which should have led to identification of the offence and the offender, but lacked the resources to pursue the investigation in a timely manner.
5. It is clear that an offender should not obtain a benefit merely as a result of successful evasion of suspicion for a lengthy period. On the other hand, the court will not be required to ignore his or her behaviour during that period. Such circumstances are well-illustrated by the plethora of delayed complaints of sexual misconduct against children.
6. So far as the causes of any lapse of time are concerned, it will often be difficult to assign sole responsibility, or even primary responsibility with any degree of certainty or precision. Nor will the particular characterisation necessarily carry a particular consequence. For example, delay may be caused by the offender absconding on bail or undertaking a campaign of delaying tactics. The offender should not normally obtain any benefit as a result of these kinds of conduct. On the other hand, it would be wrong to describe the entering of a plea of not guilty as causing delay, although clearly the forensic process will take longer where there is a trial than where there is a plea of guilty.
7. Where it can be said that delay is caused by unjustifiable conduct on the part of the prosecution, there will be no necessary obstacle to the offender obtaining some benefit by way of reduction of sentence, depending upon the consequences. On the other hand, in order to characterise a lapse of time as involving unwarranted delay, it may be necessary to form some judgment about what can reasonably be expected of the criminal justice system in its application to the particular circumstances of the proceedings.
8. So far as consequences are concerned, they may either be favourable or unfavourable. As an example of favourable consequences, a significant delay in the commencement of a prosecution may allow the offender to demonstrate that he has since led a blameless life and is quite unlikely to reoffend. Evidence of this kind should clearly be allowed and will lower the appropriate sentence. On the other hand, delay may lead to uncertainty and stress with the potential to disrupt the offender's life. However, any stress and psychological problems, to be taken into account favourably to the offender, will usually need to result from some circumstances beyond his control. Stress caused by knowledge that the authorities are aware of an offence being committed but not that the offender committed it will not assist him or her on sentence.
9. These considerations have recently been discussed in some detail by Bellew J (Meagher JA and Schmidt J agreeing) in Sabra v Regina. [91] That discussion need not be repeated here. Suffice it to say that the lapse of time between the last offences (in September 2009) and the imposition of the sentences under appeal, in April 2016, requires careful consideration.
10. One issue which has caused some difficulty in relation to consequences is the extent to which the courts can presume that delay has given rise to stress and perhaps psychological complaints and the extent to which such matters need to be established by evidence. As the relevant factors identified in s 16A(2)(m) are physical and mental condition, these should be established as actual, not presumed, conditions, in accordance with Bui. [92]
11. Most of the cases discussed in Sabra involved state offences, the discussion not distinguishing between state and federal law. In Scook v The Queen, [93] McLure JA noted: [94] "Delay itself is not one of the mandatory sentencing matters listed in s 16A(2) of the Crimes Act 1914 (Cth). Its relevance or otherwise to the sentencing of Commonwealth offenders will depend on the circumstances of the case. The principles articulated by State courts in sentencing State and Commonwealth offenders serve as a guide."
12. Referring to R v Schwabegger, [95] which involved several counts of defrauding the Commonwealth, McLure JA continued: [96] "The implication in Schwabegger is that delay is a mitigatory factor where it is due to dilatoriness or neglect on the part of the State or its instrumentalities. That may be because of the unreasonable period in which the accused is left in a state of 'uncertain suspense' (R v Todd [97] ) or because the court wishes to express its disapproval by imposing a more lenient sentence or both."
13. In Scook, Buss JA agreed "generally" with the reasons given by McLure JA but added a statement of "guiding principles". [98] Those principles excluded particular circumstances as not constituting a mitigating factor, covering such matters as delay caused by obstruction or lack of co-operation on the part of the offender. Further, Buss JA accepted that delay would "ordinarily be a mitigating factor if … the delay has resulted in significant stress for the offender or left him or her, to a significant degree, in 'uncertain suspense'." [99] He concluded that "delay caused by dilatory or neglectful conduct by the state, prosecuting authorities or investigatory bodies may result in a discount of the sentence that would otherwise be imposed on the offender…". [100]
14. The suggestion that delay resulting from dilatory behaviour on the part of the prosecuting authorities may be a ground for mitigating the severity of a sentence for a federal offence, has not been located squarely within any of the factors listed in s 16A(2). Nor does it self-evidently have such a home. That is not to say that conduct occurring in the course of a prosecution will not be relevant - it clearly will be in specified circumstances. [101] It may also be accepted that such circumstances may affect the physical or mental condition of the offender and, for example, the prospects of rehabilitation. [102] However, it is quite another thing to say that the severity of the penalty should be reduced as an expression of disapproval of the conduct of the prosecutor or investigating authority. Even if such a course were available in relation to sentencing for a state offence, it does not follow that it supplies a basis for sentencing a federal offender. Absent statutory authority, that course should not be followed.
15. On the assumption that such a delay is a legitimate consideration, the question is whether the prosecution should bear part of the responsibility for the delay. It is doubtful that much weight can be placed on this factor. In the first period, searches were undertaken of the respondent's premises in August 2009, whereas the tax returns the subject of counts 4-7 were not lodged until 29 September 2009. The respondent was arrested one year later. The first trial did not commence until March 2012, a period of some 18 months following the arrest, during which time the respondent was on bail. There was no suggestion in the material before this Court that there was any unwarranted delay attributable to the prosecution between arrest and trial.
16. The second period ran from 13 June 2012 (the date of the verdicts in the first trial) until the passing of sentence on 31 March 2014. The Court has a detailed chronology of the various events which occurred during that period (being 1 year, 9 months) which the trial judge fairly described as "mostly caused by the offender himself".
17. The third period (from the date of the first sentencing until the date of the second sentencing) was largely a consequence of the appeal process and the relisting of the matter for trial. From 1 July 2014 (the date of the judgment in this Court setting aside the first trial convictions) until the commencement of the second trial on 13 July 2015, there were virtually monthly appearances before the Court and there was no suggestion that any untoward delay occurred which was the responsibility of the prosecution.
18. The second jury delivered its verdicts on 9 September 2015 and a sentencing hearing occurred one month later. The further delay until sentences were imposed on 29 April 2016 (some five months) involved a period during which the trial judge was indisposed or unavailable.
19. It may be seen from this brief chronology that, although it is now six years since the respondent was arrested, only a minor part of that delay could be treated as unreasonable conduct of the prosecution. Much of it is the result of the working through of the criminal justice system. Because the respondent was on bail throughout the period, except for some three months following his first sentencing whilst his appeal was pending, the trials were no doubt listed later than would have been the case had he been in custody. The respondent is not, of course, to be punished for exercising his rights as a criminal defendant, but neither is he to obtain a benefit from that exercise. A degree of reduction in the appropriate sentences may be warranted, however, because he has throughout the relevant period been subject to conditional liberty as a result of his bail conditions, depending on the effect it had on his physical and mental condition.
20. So far as consequences were concerned, the respondent relied at his sentencing hearing upon three reports of Mr Watson-Munro who described the respondent as having been an "intermittent client" since February 2013 and who last examined him on 21 October 2015. He also relied upon a psychiatric report by Dr Olav Nielssen who had interviewed the respondent in July and October 2015 and prepared a report dated 23 October 2015. Finally there was a letter from a psychologist, Ms Lidija Balaz, who had provided treatment from 15 June until mid-October 2015 "on a regular basis." Her report said no more than that he had symptoms "consistent with depression and chronic stress."
21. Dr Nielssen was satisfied that he had a depressive illness which he ascribed to the following causes: [103] "Factors contributing to becoming depressed include his concern about the welfare of his two daughters, his abandonment by his long-term partner and his secretary, the loss of his business, the effect of imprisonment, and the effect of chronic and very stressful legal proceedings."
22. This evidence was no doubt accepted by the trial judge (not being challenged) but it is too imprecise to allow findings attributing any degree of depression to unjustifiable delay in the court proceedings. No doubt the length of the unresolved proceedings, however, was an important contributing factor.
23. The latter conclusion is supported by the evidence of Mr Watson-Munro. However, in March 2013, one year after the first trial, he was described as suffering from "long standing symptoms of depression, anxiety and low self-esteem." [104] He described the causes in the following terms: "In part this has developed against a backdrop of his former wife developing post-natal psychosis leading to the breakdown of the relationship and him raising his oldest child more or less since the age of five years. This is of particular relevance in the presence [present?], in the setting of his fears for her welfare at the age of 17, should he be deprived of his liberty."
24. Mr Watson-Munro prepared a second report, dated 30 May 2014, at which stage the respondent was in custody. The report read in part: [105] "Mr Pratten stated that the protracted nature of these proceedings has taken its toll upon him both physically and mentally. He feels that he has aged dramatically in the context of suffering constant anticipatory anxiety regarding the future and ongoing issues referrable to him being unable to sort out the taxation issue, which was the basis of the charge and conviction. Certainly he appears to have been involved in the criminal justice system for a number of years now and no doubt a considerable effluxion of time which has elapsed between him being charged and finally sentenced, realistically has added to his symptoms." Mr Watson-Munro also noted "his apprehension regarding the possibility of his term of imprisonment being extended should the Crown's appeal be upheld."
25. Mr Watson-Munro prepared a third report, prior to the second sentencing hearing, dated 26 October 2015. He stated: [106] "At the time of my most recent assessment I was struck by the deterioration in Mr Pratten's mood and appearance. With respect he was dishevelled, clearly depressed and extremely agitated and anxious."
26. He opined that the intensity of his depression and anxiety had escalated and that "the protracted nature of these proceedings and the effective loss of all that he was worked for have totally broken this man and I believe that even with expert care, his prognosis is at best guarded." [107]
27. None of this material was challenged at the hearing on sentence. However, its weight in favour of leniency is limited. Stress and anxiety are a natural consequence of being charged and then convicted of serious criminal offences. If such factors are to affect the severity of the sentence imposed, that will occur through the particular considerations identified in s 16A(2), to which reference has been made. To the extent that they may be due in part to periods of unwarranted delay in the prosecution of the proceedings, some allowance should be made in determining the appropriate sentence, but the effect will not be of great significance.
28. It is not possible to be sure how much significance the trial judge placed upon this factor; what can be said is that it did not justify a significant degree of leniency. Accordingly, taking into account all the circumstances set out above, the Director's submission of manifest inadequacy of the sentencing should be accepted in relation to counts 4-7. The sentences of 3 years imprisonment with respect to counts 1, 2 and 3 have not been shown to be manifestly inadequate. On the other hand, the degree of accumulation was inadequate and the resulting non-parole period was also manifestly inadequate. The final question is whether the Director has satisfied the Court that it should, in the exercise of its discretionary power, intervene to impose a higher sentence.

Residual discretion

1. As appears from the circumstances set out above, the sentences imposed on the respondent, including the non-parole period applicable to the total offending, can properly be characterised as manifestly inadequate. In part the inadequacies may be explained by specific errors made by the trial judge. That effect may be seen particularly in (a) the assumption that tax liabilities had been paid when they had not and (b) the treatment of the respondent as entitled to leniency as a first-time offender. It is also likely that too great an element of leniency resulted from reliance on the "double jeopardy" principle and on the apparent reduction because of the hardship to the offender's daughters.
2. The fact that there were identifiable errors itself constitutes a basis for the Court to exercise its discretion to resentence, in circumstances where an unexplained inadequacy of sentence may not have been sufficient. The Director accepted that she carried the burden of persuading the Court that it was appropriate for the Court to exercise the power of resentencing engaged by such error.
3. The primary reason for not intervening in this case must be the lengthy period which has elapsed since the offences were committed and, more particularly, since the offender was arrested. On the other hand, the appeal can now be disposed of within seven months of the imposition of the sentence and at a time when less than half the non-parole period has been served. The effect of delay can be reflected in a modest reduction of the overall sentence.
4. That being so, the community is entitled to feel a degree of injustice in circumstances where a man who understated his tax over a period of seven years by amounts in the order of $4.5-$5 million, with a proportionate benefit to himself and loss of public funds should receive a sentence involving a minimum term of 2 years imprisonment. The subjective circumstances of the respondent did not warrant such a sentence, which may therefore be seen to be grossly inadequate when viewed against the serious misconduct involved.
5. In considering the discretion not to intervene, it is also appropriate to bear in mind the principle of restraint which applies to resentencing after a second conviction for the same offence. Especially is that so where the sentencing judge has imposed a higher sentence than that imposed following the first conviction, set aside on appeal. The application of the principle should be evaluated by reference to its justification.
6. First, there is the important consideration that conviction appeals should not be discouraged by the concern that the appellant may face a higher sentence on a retrial. That factor, however, has limited weight in a case such as this, where the Director appealed the inadequacy of the first sentence. Similarly, there should not be a basis for fearing that the later heavier sentence was vindictive where (a) the inadequacy of the first sentence had been challenged and (b) the resentencing court explains (as indeed this Court must do on a second prosecution appeal) why the original sentence was inadequate.
7. Accordingly, the residual discretion should not be exercised and the Court should resentence the respondent. Before doing so, however, it is necessary to address the second appeal lodged by the Director.

Proceeds of Crime Act offence

1. Following the respondent's arrest on 22 September 2010 for the tax offences, the Director sought restraining orders under s 17 of the Proceeds of Crime Act 2002 (Cth) over a number of assets. On 21 November 2011 Hislop J made such orders. One of the assets was a game fishing boat known as "Los Lobos". The restraining order was served on the respondent on 22 November 2011.
2. The order prohibited any person (including the respondent) from disposing of or otherwise dealing with the boat in contravention of the order. The first element of the offence, for which the respondent was convicted, relied on the term "deal with" being defined to include "remove the property from Australia". The prosecution accepted that it must prove beyond reasonable doubt that the respondent intended to remove the boat from Australia.
3. The conduct relied upon by the prosecution included arrangements made by the respondent to employ a professional vessel delivery agent (and an assistant) to take the boat to Vanuatu, including making a payment of his fees. He also paid for work, including fitting a life raft and an extra fuel tank, to make the boat seaworthy for its trip to Vanuatu. For that purpose, the respondent took the boat from its ordinary mooring at Point Piper on Sydney Harbour to Newcastle. That trip took place less than a month after he was served with the restraining order. The boat was then moored in Newcastle from December 2011 until May 2012, whilst the additional work was undertaken to make it seaworthy. During that period, the respondent was on bail with respect to the tax offences.
4. The first trial on those charges took place between 21 March 2012 and 13 June 2012 when the jury returned verdicts of guilty at the first trial. In May 2012 the respondent travelled with the delivery agent and his assistant on the boat from Newcastle to Port Stephens. He then left the boat, but by that stage it was clear that further work was required. The delivery agent and his assistant continued onward to Yamba, planning to sail from there to Bundaberg and eventually to Vanuatu. The respondent authorised the further work.
5. On 3 July 2012, shortly after his conviction of the tax offences at the first trial (and before he was sentenced or the appeal was dealt with), he was arrested for attempting to contravene the restraining order applicable to the boat.
6. The respondent entered a plea of not guilty and was tried by jury in the District Court in March 2016. His primary defence was that the activities engaged in were merely preparatory to removing the boat from Australia and did not constitute an attempted removal. The jury rejected that defence.
7. Following a verdict of guilty, the respondent was sentenced by Baly DCJ on 22 July 2016. She convicted the respondent and ordered that he pay a fine of $10,000. The Director appealed against the inadequacy of this sentence.
8. The maximum penalty for a contravention of a restraining order, pursuant to s 37(1) of the Proceeds of Crime Act is 5 years and a fine of $33,000. [108] A person guilty of an attempt to commit an offence is liable to the same punishment. [109] In her reasons for sentencing the offender, Baly DCJ accepted that "to knowingly contravene a court order is a serious offence." [110] However, she thought that it was less serious than might otherwise have been the case because she was "not satisfied that [the respondent] intended to sell it, or otherwise dispose of it". [111] However, it is not entirely clear how much that was thought to mitigate the seriousness of the offending. To remove the boat from Australia was effectively to remove it from the immediate ability of the Commonwealth to obtain the benefits of a forfeiture order, if such an order were to be made. The purpose of the restraining order would thus be subverted and the consequence would differ little from a sale and failure to account for the proceeds of sale.
9. The sentencing judge also declined to find that the respondent's actions caused the value of the boat to be reduced. [112] Indeed, she considered the repairs and extra fittings may well have enhanced its value. [113] The judge held, correctly, that the question of whether the offending caused any loss was relevant pursuant to s 16A of the Crimes Act. [114] However, any change in the value of the boat was of limited relevance given that the offence was an unsuccessful attempt to deal with the boat, with the result that it was not removed from Australia and the purpose of the restraining order was not ultimately defeated.
10. The sentencing judge recognised that there was a serious aggravating factor in that the offence was committed whilst the respondent was on bail and, indeed, some of his actions took place whilst he was on trial for the tax fraud matters.

(a) prior convictions

1. The judge dealt with the requirement to take into account the character and antecedents of the offender, referred to in s 16A(2)(m) of the Crimes Act, by limiting her consideration to the respondent's prior convictions at the date of the offending. She erred in several respects which were likely to have affected the adequacy of the penalty imposed. First, although she noted that there were convictions for failing to lodge tax returns, she concluded that those were "clearly related to the fraud matters", referring to the tax offences the subject of the other trial. That was not so; the failures to lodge tax returns were separate and unrelated matters.
2. Secondly, the judge limited her consideration to "prior convictions" during the time of the offending and disregarded the tax offences because he was not convicted until sentencing, at a time well after the jury had returned their verdicts and after the proceeds of crime offence had been completed. However, this approach gave an unduly restrictive reading to s 16A(2)(m). For reasons noted in relation to the sentencing for the tax offences, the judge should have taken into account the fact that the breach of the restraining order occurred long after the occurrence of the serious offences of dishonesty of which the jury had found him guilty.
3. Furthermore, by the time Baly DCJ was sentencing him with respect to the breach of the restraining order, he had been convicted and sentenced by Rothman J for the tax offences. It was therefore erroneous on any view to treat him as an offender with no prior convictions.
4. There were two further aspects to the sentencing with which issue was taken on the appeal. The judge said that she took into account "delay" by way of mitigation of the penalty. [115] She also took into account "the well-recognised principle of the fact that a matter can be dealt with in the Local Court." [116]

(b) delay

1. With respect to delay, the starting point is the commission of the offence, which commenced in December 2011 and proceeded up until May 2012. He was arrested on 3 July 2012. The trial did not take place until 21 March 2016, with a verdict of guilty returned on 1 April 2016. The matter was listed for sentence on 13 May 2016. Although there is no detailed chronology before this Court setting out the causes of the delay, the trial judge referred to applications to adjourn the proceedings because the fraud matters had not been finalised and accepted that "the offender, himself, is really the architect of much of the delay". The judge nevertheless stated that decisions, including R v Todd [117] and Sabra, state that "a court may take into account the effect of delay when it has meant that an offender has had a matter hanging over his or her head for a considerable period of time." There was a finding that the delay had contributed to the respondent's "deteriorating mental state." [118]
2. There are difficulties with this passage. First, R v Todd does not stand for the principle enunciated. In that case, the offender had committed a number of offences in New South Wales and Queensland, all within a period of some eight days. He served sentences for the Queensland offences (he being arrested in that State) before he came to be sentenced for the New South Wales offences. This Court held that it had been wrong on the part of the trial judge to disregard the sentences served in Queensland. Those sentences were relevant because (a) they shed some light upon his state of rehabilitation, (b) there had been an inevitable deferment of the criminal process in New South Wales and (c) had the offences been dealt with together in New South Wales the principle of totality would have operated so that the sentences imposed would not have been considered entirely independently of each other. [119] Todd was not concerned with the situation where the hearing of the charges was adjourned on the application of the offender.
3. Sabra has been referred to above in discussing the tax fraud sentences. Sabra involved an unexplained delay of 2.5 years between the lodgement of the last false claim with the Commonwealth and the laying of charges. The delay was, thus, treated as the responsibility of the prosecution. Blanco v R, [120] referred to in Sabra at [30] was also an example of "the inordinate and unexpected delay in the prosecution of the appellant". Sabra then referred to Schwabegger [121] which referred to "[d]elay which is not attributable to the offender" constituting "a powerful mitigatory factor". At [34] in Sabra, reference was made to R v Gay [122] in which Mason P agreed with the observations in Schwabegger and expressed concern as to the delay in prosecuting the matter. No attempt was made to relate the analysis to Pt 1B of the Crimes Act.
4. In Giourtalis v R, [123] Bathurst CJ addressed the relevance of delay in sentencing a complex fraud matter. After referring to these and other authorities, Bathurst CJ stated, referring to principles set out by Buss JA in Scook: [124] "As Buss JA pointed out, the principles are not inflexible and the extent the delay would be taken into account as a mitigating factor must depend on the particular facts of the case in question. However, in the case of a complex fraud it will always be necessary to balance the effect of the delay on the offender against the difficulty and complexity of proving the offence and the need for general deterrence. In particular, although an accused person is entitled to rely on the rights and protection of the criminal law, in circumstances where such reliance has necessitated a complex and lengthy investigation which is carried out with reasonable expedition, the extent that delay can be called upon as a mitigating factor is limited, although the conduct during the period of delay remains relevant to the extent it indicated prospects of rehabilitation. Further, there may be cases where the delay is so inordinate that notwithstanding the complexity of the investigation, the fact that the accused has been left in a state of uncertainty for a considerable period of time would be a significant mitigating factor."
5. These cases do not stand for the proposition that where there has been a significant lapse of time between the date of the offending and the trial, where the offender has caused the delay, that the offender can then rely upon that fact in mitigation of sentence. Indeed, any such principle would be an invitation to offenders to take all available steps to delay a trial. Accordingly, not only did the authorities relied upon by the sentencing judge not warrant the conclusion that delay could be treated as a mitigating factor; in principle, it would be a most unusual case in which such a consideration could be taken into account. In any event, for reasons discussed in relation to the taxation frauds, these principles have no application unless located in Pt 1B of the Crimes Act, or otherwise picked up by a federal law.
6. That is not to say that the lapse of time for any cause may not provide a basis for favourable (or unfavourable) findings in relation to principles which are directly relevant to the sentencing process, including (as in Todd) cases where other sentences have been served, and cases where, in other ways, evidence of remorse or rehabilitation may become available. That is not this case.
7. A further problem with the judge's approach is that, although she made a finding that the delay had been a cause of anxiety to the respondent, it had coincided with the whole of the period during which the far more serious offences of tax fraud were hanging over the offender. The psychological reports before the trial judge provided no basis for distinguishing causes of the respondent's deteriorating mental state. Even on a factual basis, the judge was not warranted in taking into account such anxiety as wholly caused by delay in sentencing for the specific offences before her.

(c) availability of proceeding in lower court

1. In relation to the second matter, there is, as counsel acknowledged, a range of statements in the authorities as to the relevance of the fact that a charge could have been dealt with in the Local Court, but was not. Any finding by a sentencing judge to that effect is an indirect expression of the view that the appropriate sentence to be imposed is one which fell within the sentencing powers of the Local Court and should have been so understood prior to the commencement of proceedings. But what is the relevance of what should have been understood prior to the commencement of proceedings? Under s 16A, the principal question is what view of the offence the sentencing judge takes: if of the view that the appropriate sentence is one which could have been imposed by the Local Court, that sentence should be imposed. It does not follow that the appropriate sentence should be reduced because it could have been imposed by a magistrate.
2. In substance, the justification for treating this factor as capable of mitigating a sentence must be found in the effect on the offender of facing a trial before a District Court judge, rather than before a magistrate. There are a number of possible reasons why that may be so. For example, a trial may be heard sooner in the Local Court; the trial may be conducted more expeditiously before a magistrate than before a judge or judge and jury, and the defendant may suffer less anxiety knowing the limits of the sentencing powers of the court. If those are the factors at stake, it may be that they can be taken into account in State jurisdiction, even though the basis for the conclusion that the matter should have been dealt with in the Local Court was not the only conclusion available prior to the commencement of the proceedings. Yet, again, there was no attempt to explain how these factors operated within the terms of s 16A.
3. Assuming that some such considerations could properly underlie the finding of the sentencing judge in this regard, and assuming that there was some material before her which supported the view that the offender had suffered adversely as a result of the trial with a jury (rather than embracing it), this was nevertheless not a case where any such opinion could be reached with clear justification. The offence involved an attempted breach of any order made by a judge of the Supreme Court. It was reasonable not to require that such a matter be dealt with by a magistrate. Further, there is merit in the submission made by the Director that the offence required a sentence of imprisonment to be wholly accumulated on the sentences imposed for the tax fraud offences. In State jurisdiction, a magistrate can impose a sentence of 2 years imprisonment; under Commonwealth law, [125] a magistrate dealing summarily with an indictable offence punishable by imprisonment for a period not exceeding 5 years can only impose 12 months imprisonment, thus giving less margin for error where there is confidence that a period of imprisonment is required but doubt as to the appropriate severity of the penalty.
4. Thirdly, the defence run by the respondent was that the steps he took were no more than preparatory to the commission of an offence and did not constitute an attempt. That was an issue which could properly have been relied on before a jury, but which could not be raised on a plea.
5. The reasoning of the sentencing judge in relation to this issue was succinct. For reasons already noted, the judge may have underestimated the seriousness of the offence, which she described as of "reasonably low seriousness." [126] The basis on which the fact that the matter could have been dealt with in the Local Court was taken into account in mitigation (that is reduction) of the sentence imposed was not explained. In the circumstances, it was a matter which could not have had a significant effect on the sentence.

(d) intervention

1. For these reasons, the Director has made good her assertion that the sentence was manifestly inadequate. It remains to consider whether the Court should, in the exercise of its discretionary powers, intervene. The primary reason for intervention in this case is that the imposition of a $10,000 fine in the face of deliberate breach of an order made by a Supreme Court judge demonstrates an inappropriate degree of leniency. The judge herself found that there was no authority which gave guidance in respect of the severity of the penalty to be imposed. As a matter of principle however, in the face of a course of deliberate conduct in breach of an order, which commenced almost as soon as the offender was notified of the order, and in the absence of significant subjective circumstances warranting a reduction in the penalty, it would usually be necessary to impose a period of imprisonment. The period need not be lengthy and, in this case, must be imposed in the context of other lengthier periods of imprisonment for more serious offending.
2. It is appropriate in these circumstances to set aside the sentence imposed by Baly DCJ on 22 July 2016. There is no submission on the part of the respondent that the fine of $10,000 has been paid. If it has been, it could be remitted. In any event, the sentence should be set aside and in place thereof a period of 6 months imprisonment imposed.

Resentencing

1. The sentence of imprisonment for the breach of the restraining order is the shortest to be imposed by way of resentencing. Accordingly, it should commence on the date fixed for the commencement of the tax fraud sentences, namely 20 January 2016. A period of six months from that date will have expired on 19 July 2016.
2. Although the maximum penalty for each count of tax fraud was 10 years imprisonment and a fine of $66,000, the unchallenged conclusion of the trial judge that a fulltime custodial sentence was warranted is not in doubt. The imposition of a fine would be a futile exercise in circumstances where the outstanding tax liability has not been met.
3. In respect of counts 1-3 of the tax fraud offences, the Court should not intervene in the sentences imposed by the sentencing judge, namely, in respect of each conviction, a sentence of 3 years imprisonment. However, those sentences will need to be partly accumulated on the sentence for breach of the restraining order. Further, as noted above, it is appropriate to treat the offences in groups according to the dates on which the relevant tax returns were lodged. Those for counts 1 and 2 were lodged together on 18 August 2005 and the sentences for those offences should be served entirely concurrently with each other. There will be a degree of accumulation in respect of the third count, the return for which was lodged on 21 June 2006.
4. The degree of accumulation appropriate in respect of the restraining order offence should allow that 4 months of that sentence be served on account of that offence alone. Accordingly the period of imprisonment for 3 years in respect of the first two counts of the tax fraud offences should commence on 20 May 2016 and will terminate on 19 May 2019. The offender should serve 6 months attributable solely to those offences, meaning that the 3 year term in respect of count 3 should commence on 20 November 2016 and end on 19 November 2019. The justification for a further non-concurrent period of imprisonment in respect of count 3 is twofold. First, there was a separate period of offending when the tax return for the 2005 financial year was lodged; secondly, it was the first year in which the sentencing judge was satisfied that the respondent bore full responsibility for the carrying out of the tax frauds.
5. Each of counts 4-7 involved tax returns lodged on one occasion, namely 29 September 2009. With respect to counts 4, 5 and 6, the average amount involved was a deficit of $1 million in the revealed income. The returns were lodged after the respondent became aware that he was being investigated by the Australian Taxation Office, through the execution of search warrants on his residential and business premises, and the period was one during which the judge was satisfied he was wholly responsible for the operation of the scheme. A sentence of 5 years imprisonment should be imposed for each offence, each to be served concurrently with the other two sentences. All three should be accumulated by a period of 6 months on the sentence for count 3 and should therefore commence on 20 May 2017 and terminate on 19 May 2022.
6. The tax return for count 7 was lodged on the same date as those for counts 4, 5 and 6. In one sense the criminality involved was the same; on the other hand, the amount involved was a little under $135,000. Accordingly a lesser sentence should be imposed, namely a sentence of 3 years and 6 months imprisonment to run concurrently with the sentences for counts 4, 5 and 6. That sentence will be wholly consumed within the longer period applicable to those counts; it will terminate on 19 November 2020. The overall effect is a sentence of imprisonment of 6 years and 4 months. A non-parole period of 3 years, 9 months should be fixed, commencing on 20 January 2016 and expiring on 19 October 2019.
7. The result of this sentencing regime is that the period to be served solely referable to the breach of the restraining order is 4 months. With respect to the tax fraud offences, the periods to be served referable solely to counts 1, 2 and 3 will be 1 year. That involves a degree of leniency which is justified by reference to the delay in the running of the criminal process and the reaching of an ultimate result, albeit that much of the time which elapsed resulted from steps taken by the respondent.
8. Further, the imposition of concurrent sentences for the last four counts, given the fact that these tax returns were lodged some four years after the first tax returns involved in the scheme, were lodged after the Australian Taxation Office had commenced its investigation and involved in combination amounts exceeding $3 million, also involves a degree of leniency which is to be justified only by reference to the delay in reaching a final conclusion to the criminal process. As noted above, there was psychological evidence supportive of the conclusion that the delay has caused some deterioration in the respondent's mental state, although one might infer that the collapse of his business affairs and personal lifestyle, attributable to the consequences of the tax frauds, would have resulted in at least part of that deterioration, absent the delays in the forensic process.
9. It may be noted that, given the moderate levels of accumulation, some 2 years, 5 months of the minimum term will coincide with the period attributable (though not solely attributable) to the 5 year terms on counts 4-6.
10. To ensure compliance with s 16F of the Crimes Act, it is recorded that the period of mandatory custody prior to the offender first being eligible for conditional release will terminate, and the offender will first be eligible for release on parole, on 19 October 2019. The Director is to ensure that the offender is provided with a copy of these reasons and is to take steps necessary to ensure that the offender is given appropriate advice in due course as to the conditions imposed upon his conditional release on parole, by or pursuant to s 19AN of the Crimes Act, and as to the duration of that parole.

Orders

1. The Court makes the following orders: 1. Allow the appeal by the Commonwealth Director of Public Prosecutions and set aside the sentences imposed by the Supreme Court of New South Wales on 29 April 2016 for seven offences under s 134.2(1) of the Criminal Code (Cth). 2. Allow the appeal by the Commonwealth Director of Public Prosecutions and set aside the sentence imposed by the District Court of New South Wales on 22 July 2016 for an offence under s 37(1) of the Proceeds of Crime Act 2002 (Cth) and s 11.1(1) of the Criminal Code (Cth). 3. Resentence the respondent Timothy Charles Pratten as follows: 1. for the offence under s 37(1) of the Proceeds of Crime Act - imprisonment for 6 months to date from 20 January 2016 and expiring on 19 July 2016; 2. for offences under s 134.2(1) of the Criminal Code - 1. as to counts 1 and 2 - imprisonment for 3 years to date from 20 May 2016 and expiring on 19 May 2019; 2. as to count 3 - imprisonment for 3 years to date from 20 November 2016 and expiring on 19 November 2019; 3. as to count 7 - imprisonment for 3 years 6 months to date from 20 May 2017 and expiring on 19 November 2020; 4. as to counts 4, 5 and 6 - imprisonment for 5 years to date from 20 May 2017 and expiring on 19 May 2022. 1. Fix a single non-parole period in respect of the above sentences of 3 years 9 months to date from 20 January 2016 and continuing until 19 October 2019. 2. The offender is first eligible for release on parole on 19 October 2019.
2. S CAMPBELL J: I have had the considerable advantage of reading the judgment of Basten JA in draft. I agree that the respondent should be resentenced as proposed by his Honour for the reasons he gives.
3. I wish to record, with respect, that there is much to be said for the view expressed by Beech-Jones J about the construction of s 16A(2)(p) Crimes Act 1914 (Cth) in R v Zerafa. Given the matter was not argued; the long line of contrary authority; and we are but a court of three this is not an appropriate case to consider departing from the established construction generally agreed in by intermediate courts of appeal throughout the Commonwealth
4. N ADAMS J: I have had the benefit of reading the draft judgment of Basten JA. I respectfully agree that the sentences imposed upon the respondent by Rothman J on 29 April 2016 for counts 4, 5, 6 and 7 are manifestly inadequate and that the degree of accumulation with counts 1, 2 and 3 was such as to result in a total sentence which was manifestly inadequate. I also respectfully agree with his Honour that the sentence imposed upon the respondent by Baly SC DCJ on 22 July 2016 was manifestly inadequate for the reasons given by his Honour. I am satisfied that this Court should exercise its discretionary power to intervene and re-sentence the respondent as proposed by his Honour.
5. I wish only to add that I too am of the view that there is much force in the view expressed by Beech-Jones J in R v Zerafa concerning the proper construction of s 16A(2)(p) of the Crimes Act 1914 (Cth). As Basten JA has observed at [60] it was not necessary to decide whether this Court should follow the reasoning of Beech-Jones J in R v Zerafa in this appeal.

Endnotes

1. R v Pratten (No 25) [2016] NSWSC 539 ("Pratten").
2. Pratten at [8]-[10] and [123].
3. Pratten at [107] and [121].
4. Pratten at [109].
5. Pratten at [110].
6. Where, as in this case, the provision creating the offence does not specify a pecuniary penalty one may nevertheless be imposed: Crimes Act 1914 (Cth), s 4B(2). The penalty units for an offence carrying 10 years imprisonment is 600; the prescribed value of a unit was $110 from 2005 to 2010: Crimes Act, s 4AA(1).
7. Pratten at [104].
8. Pratten at [26].
9. Pratten at [32].
10. Pratten at [44].
11. Pratten at [122].
12. Pratten at [123].
13. Pratten at [8].
14. Pratten at [117].
15. See R H McL v The Queen (2000) 203 CLR 452; [2000] HCA 46, discussed below.
16. (2012) 244 CLR 638; [2012] HCA 1 at [13]-[14].
17. Cf R H McL at [141]-[142] (Kirby J).
18. (2008) 70 NSWLR 660; [2008] NSWCCA 63.
19. Blundell at [39] and [47].
20. R H McL at [23].
21. R H McL at [72].
22. [1999] 2 Qd R 85 at 87 (Fitzgerald P, McPherson JA and Dowsett J); R H McL at [140].
23. [2002] NSWSC 1182; 173 FLR 1 at [84] (Bruce James J).
24. [2007] NSWCCA 124; 171 A Crim R 425 at [30]-[31] (Hidden, Bell and Johnson JJ).
25. [2008] NSWCCA 287 at [49]-[51] (Hislop J, McClellan CJ at CL and Hoeben J agreeing).
26. See Putland v The Queen (2004) 218 CLR 174; [2004] HCA 8 at [32] (Gummow and Heydon JJ).
27. Crimes Legislation Amendment Act (No 2) 1989 (Cth), s 6.
28. (1990) 21 NSWLR 370 at 377 (Kirby P, Campbell and Newman JJ).
29. The section was subsequently amended to rectify that omission by the insertion of par (ja).
30. [2004] HCA 15; 78 ALJR 616 (Gummow, Callinan and Heydon JJ; Gleeson CJ and Kirby J agreeing).
31. Johnson at [14]-[15].
32. (1990) 20 NSWLR 427 at 437.
33. El Karhani at 372.
34. (2010) 242 CLR 520; [2010] HCA 45 at [20].
35. Hili at [22].
36. Hili at [25], referring to Johnson at [15].
37. See fn (16) above.
38. Bui at [10].
39. Bui at [13], referring to Pearce v The Queen (1998) 194 CLR 610; [1998] HCA 57 at [10] and [56] and The Queen v Carroll (2002) 213 CLR 635; [2002] HCA 55 at [84].
40. (1979) 46 FLR 386.
41. Bui at [17].
42. Bui at [18].
43. Section 16A(1).
44. Bui at [19].
45. Bui at [22]-[23].
46. (2010) 79 NSWLR 1; [2010] NSWCCA 194 at [279]-[280].
47. Bui at [22] and [23].
48. Bui at [28].
49. Pratten at [107].
50. Pratten at [121].
51. R v Sinclair (1990) 51 A Crim R 418 at 430-431 (Malcolm CJ, Kennedy and Pidgeon JJ agreeing) adopting statements to that effect in the South Australian Court of Criminal Appeal in R v Adami (1989) 51 SASR 229 at 233, which in turn applied the general law principle stated by Bray CJ in R v Wirth (1976) 14 SASR 291 at 293-294.
52. [2001] NSWCCA 522; 127 A Crim R 23 at [13]-[17].
53. [2013] NSWCCA 222; 235 A Crim R 265 at [109]-[138]; see also Elshani v R [2015] NSWCCA 254 at [3]-[7] (Gleeson JA) and [30]-[35] (Michael Adams J) and [40]-[41] (Beech-Jones J).
54. R v Zerafa [2012] NSWSC 978 at [87].
55. Zerafa at [141].
56. Australian Law Reform Commission, Report 103, Same Crime, Same Time - Sentencing of Federal Offenders (April 2006), par 6.124.
57. (1996) 90 A Crim R 510.
58. Edwards at 518.
59. Edwards at 517.
60. Hili at [21] and Bui at [26] and [27].
61. [2010] QCA 10; 198 A Crim R 430 (Keane and Fraser JJA and Atkinson J).
62. Hili at [39]-[40].
63. Pratten at [123].
64. [2010] NSWCCA 202 (Price J, with whom Hall J and I agreed) at [18].
65. [2004] NSWCCA 220.
66. [2005] NSWCCA 182.
67. Crimes Act, s 19AB - s 19AK.
68. Pratten at [109].
69. Pratten at [110].
70. Weininger v The Queen (2003) 212 CLR 629; [2003] HCA 14 at [29] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
71. Pratten at [102].
72. Pratten at [103].
73. McIntosh v R [2015] NSWCCA 184 at [120].
74. Pratten at [101].
75. [2006] VSCA 273.
76. Cf R v Coukoulis (2003) 7 VR 45; [2003] VSCA 22 at [34] (Ormiston JA).
77. Alimic at [12].
78. [2006] NSWCCA 408.
79. See Ruha at [62].
80. [2007] NSWCCA 18 (in Ruha at [63]).
81. [2007] NSWCCA 28 (in Ruha at [61]).
82. R v Glyn Morgan Jones; R v Anthony Joseph Luis Hili [2010] NSWCCA 108; 76 ATR 249 ("Hili (CCA)").
83. Hili (CCA) at [6].
84. Hili (CCA) at [42].
85. Hili at [63].
86. Ruha at [45].
87. Pratten at [100].
88. Pratten at [108].
89. Pratten at [118].
90. Pratten at [121].
91. [2015] NSWCCA 38 at [27]-[45].
92. Bui at [23].
93. [2008] WASCA 114; 185 A Crim R 164.
94. Scook at [16].
95. [1998] 4 VR 649.
96. Scook at [21].
97. [1982] 2 NSWLR 517 at 519.
98. Scook at [56]-[57].
99. Scook at [63(a)].
100. Scook at [64].
101. Section 16A(2)(fa), (g) and (h).
102. Section 16A(2)(m) and (n).
103. Report, p 5.
104. Report, 25 March 2013, p 2.
105. Second report, p 2.
106. Third report, p 1.
107. Third report, p 4.
108. Although the Director proffered a figure of $51,000, the fine is identified as 300 penalty units, the prescribed value of a unit being $110 in 2012: Crimes Act, s 4AA(1).
109. Criminal Code, s 11.1(1).
110. Sentencing judgment, p 4.
111. Sentencing judgment, p 5.
112. Sentencing judgment, p 5.
113. Sentencing judgment, p 4.
114. See s 16A(2)(e).
115. Sentencing judgment, p 8.
116. Sentencing judgment, p 9.
117. [1982] 2 NSWLR 517.
118. Sentencing judgment, pp 8-9.
119. Todd at 519 (Street CJ).
120. [1999] NSWCCA 121; 106 A Crim R 303.
121. [1998] 4 VR 649 at 659.
122. [2002] NSWCCA 6 at [17]-[18]
123. [2013] NSWCCA 216.
124. Scook at [57]-[65]; Giourtalis at [1791].
125. Crimes Act, s 4J(3).
126. Sentencing judgment, p 9.

Amendments 07 November 2017 - [58] Replacing "is" with "it was" in quote. [129] Amending s 37(2) to read s 37(1). Fn 51 Replacing "Wells J" with "Bray CJ". DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 07 November 2017