Criminal law - Sentence - Sentencing standards - Whether deterrence can displace other considerations - Rehabilitation - Interests of the offender and the community

Crimes Act 1914 (Cth), s 20(1)(b)

Social Security Act 1991 (Cth), s 1344(1)(a)

Student and Youth Assistance Act 1973 (Cth), s 49(1)(a)(iii)

Order that appellant be released after 4 months on own recognisance for 2 years

Respondent : Commonwealth Director of Public Prosecutions

Australian Coal v Commonwealth [1953] HCA 25; (1953) 94 CLR 621

Brown v R (1982) 5 A Crim R 404

Duncan v R (1983) 9 A Crim R 354

House v R [1936] HCA 40; (1936) 55 CLR 499

Laxton v Justice (1985) 38 SASR 376

Nunn v Kinnon (1988) 4 WAR 459

R v Rossi and Bowman (1988) 4 WAR 463

R v Sinclair (1990) 51 A Crim R 418

R v Tait & Bartley 24 ALR 473

Weng Keong Chan (1989) 38 A Crim R 337

1 ROBERTS-SMITH J: The appellant was charged with a number of offences by two complaints. The first group were two offences contrary to s 49(1)(a)(iii) of the Student and Youth Assistance Act 1973 (Cth) alleging that he made false statements in connection with an application for Abstudy; namely, that he was not at the time in receipt of other payments from Social Security. These offences occurred between 11 November 1997 and 30 April 1998.

2 The other group comprised five offences contrary to s 1344(1)(a) of the Social Security Act 1991 (Cth) alleging that he made false statements in connection with claims for various Social Security benefits; namely, that at the time he was not receiving payments of Abstudy. These offences occurred between February and May 1998.

3 The total amount of benefits wrongly obtained by him was $4,280.92.

4 The appellant pleaded guilty, admittedly not on the first occasion of his appearance before the Court of Petty Sessions but it was the first plea which he entered. He was sentenced in the Court of Petty Sessions on 7 August 2000. On the first group of offences, he was sentenced to a global term of imprisonment of 8 months and on the other group, he was sentenced to 12 months' imprisonment globally with an order that the sentences be served cumulatively.

5 The appellant now appeals by leave on a number of grounds to which an additional ground was added this morning by further leave so that the grounds now stand as follows:

(a) the sentence imposed by the learned Magistrate was manifestly excessive, in particular, having regard to

(2) the appellant's personal circumstances as outlined in the pre-sentence report, and

(3) the appellant's successful completion of work and development orders and parole in the past;

(b) that the learned Magistrate erred by not making a recognisance release order with a pre-release period pursuant to section 20(1)(b) of the Crimes Act 1914 (Cth); in particular, having regard to the matters set out in grounds (a)(i), (ii) and (iii) above; and

(c) that the learned Magistrate erred by ordering that the sentence of 8 months' imprisonment and 12 months' imprisonment be served cumulatively with one another.

6 The amendment sought and made this morning by the addition of ground (c) was no doubt a consequence of a concession made by the respondent in the respondent's outline of submissions accepting that it was appropriate for the sentences imposed by the learned Magistrate to have been ordered to be concurrent, such that the appellant would have been sentenced to an overall head term of 12 months' imprisonment.

7 The facts of the matter as put to the learned Magistrate on 7 August this year were essentially that the appellant was overpaid $4,218.92 as a result of being in receipt of Abstudy payments when he had failed to undertake studies at Edith Cowan University and subsequently failing to advise that he was in receipt of Abstudy payments whilst he was receiving or applying for other Social Security benefits.

8 There were several categories of benefits which he was paid and I do not think it is necessary for me to canvass them here. Suffice to say that in relation to his various applications for them, it was necessary for him to advise in one form or another whether or not he was in receipt of any other benefit. Relevantly, of course, he denied being in receipt of benefits when that denial was simply not true.

9 The offences came to light in June 1998 as a result of data matching between Abstudy and the Department of Social Security records. A letter was then sent to the appellant advising him of this finding. A follow-up check with the university revealed that he was in fact not enrolled and had no entitlement to any Abstudy allowance paid between 2 January 1998 and 28 August that year.

10 It seems that the appellant operated two Commonwealth bank accounts; one for receipt of his Abstudy payments, the other for receipt of his various other social security benefits. An examination undertaken of his bank accounts showed that he regularly made balance inquiries on the dates his Abstudy payments were made and that he withdrew the entire payments on those dates. That examination also showed that he made similar inquiries in respect of the other account.

11 He had previously had overpayments raised against him - being in receipt of dual benefits - and was prosecuted in 1997 for having been in receipt of both Newstart allowance and Abstudy allowance for the period January 1997 to April that year. On that occasion he was convicted and ordered to enter into a recognisance of $5,000 for 18 months and to do 120 hours of community work.

12 That recognisance was breached on 12 October 1999 by virtue of him having reoffended. He was fined $250 and ordered to forfeit $250 of his recognisance. Significantly the present offences were committed whilst the appellant was on his recognisance and only some three months into it.

13 All of these matters were put before the learned Magistrate. Counsel for the appellant told his Worship that at the time the offences were committed the appellant and his family were in grave financial difficulties. This was the result, at least in part, of his wife suffering from cervical cancer and requiring an operation which cost $3,500. In addition to that, of his four children, all girls (aged 6, 4, 3, and 2), three suffered from epilepsy.

14 As to the appellant's studies at university it was put to his Worship that the appellant did in fact enrol and intend to commence studies but unfortunately was not able to continue that because of the necessity to take time out to care for his wife and four children. Nonetheless he continued to receive the Abstudy and other social security benefits because of the grave financial circumstances in which he found himself and his family.

15 It was put that he was very remorseful about what had occurred and that he owed at that stage only $600 of the amount which had previously been obtained and in respect of which the previous recognisance had been imposed.

16 As at 7 August he was in an Aboriginal group training program which was referred to in the pre-sentence report to which I shall come in a moment. He was in receipt of $350 per fortnight and out of that was paying previous fines, restitution and of course family expenses.

17 I think the substantial point of the plea in mitigation was that at the time of these offences the appellant was under a high degree of emotional and financial stress as a result of having to deal with his wife's illness, his children's illnesses and trying to provide financial and other support to the family in those circumstances. This was a longstanding relationship in which he had been for some 14 years.

18 It was pointed out to the learned magistrate that although the appellant's record was not a good one there had been a demonstrable shift in it in recent years. Furthermore, he had been recently working hard at addressing his personal circumstances. He was working on the Aboriginal training scheme two days a week and was prepared to undertake further community service work.

19 Counsel submitted to his Worship that the pre-sentence report was favourable in terms of some kind of non-custodial disposition. His Worship, however, took the view that he had no alternative but to impose a custodial sentence. As he correctly observed, social security fraud is a serious offence and imposes serious costs to the community. The system depends upon the honesty of applicants for its effective operation and those who are minded to abuse it and to obtain benefits by deceit to which they are not entitled need to be deterred. None of this indicates any error on the part of the magistrate.

20 In imposing the global sentence of 20 months the learned Magistrate stated that he was not prepared to make the appellant eligible for parole having regard to his record and past performance but when counsel drew attention to the requirements in respect of the imposition or ordering of a recognisance release order his Worship simply responded that he did not believe that was appropriate because the appellant had been placed on a recognisance on the last occasion and had breached that recognisance.

21 The pre-sentence report dealt in some detail with the background and circumstances of the appellant. In respect of his previous response to supervision the report noted that his previous response was recorded as being fairly poor in that he was breached on his last three community based orders in 1999 for non-compliance which, however, the report observed, was around the time his partner was ill and the family was very unsettled and transient.

22 The report went on to note that he successfully completed four work and development orders and two parole periods from 12 October 1990 to 12 April 1991 and from 15 August 1992 to 18 March 1993. There was reference made to the appellant and his partner and their 14-year long relationship, the fact that they had four children aged 2 to 6, all of whom (cf: counsel had told the learned Magistrate it was three) suffered from asthma and epilepsy and that the appellant's partner appears to be very supportive of him despite her continuing ill-health which required ongoing surgery.

23 It was noted further that the appellant has held no permanent employment, but in recent times, at least at that stage, had become involved in the Aboriginal training scheme in Cannington where he had been working as a laundry worker. He was hopeful to gain full-time employment through that and that possibility had been confirmed through the Aboriginal training scheme.

24 Inquiries were apparently made of workers at the scheme who advised that he had been a regular and keen participant and that he attended with his partner and had been instrumental in having other relatives join the program. During the course he had apparently developed increasing confidence and had contributed to the group and was helpful to younger group members.

25 The observation was made that as he does not drive he walked to his workplace at 5 am, which was thought to demonstrate his motivation and dedication to the program. None of the present offences related to substance abuse although, according to the report, the appellant had admitted that he used to be a heavy binge drinker, but had not been intoxicated for over 1 year.

26 In summary, it was noted that the appellant has a lengthy court history, but now appeared to be trying to make a life for himself and his family. Reference was again made to the Aboriginal group training scheme. It was pointed out that the offences did not seem to be for financial or gratuitous gain, but to provide medical assistance for his wife and his four children.

27 Finally, it was said that although his past performance on supervision had been poor, he successfully completed two parole orders in 1990 and 1991. His more recent response to supervision in 1997-98 had not been so favourable primarily because of his personal circumstances. Nonetheless, the writer considered that he had shown a change of attitude since the breach of his community based orders and suggested it may be that the court could consider placing him on a community based order with a community work component which would allow him to continue to support his family and make repayments towards his debts as well as making reparation to the community.

28 It was argued before me that the learned Magistrate erred in imposing the sentence of imprisonment he did, at least largely by reason of a failure to take account of what was described as substantial mitigation in this case. That is said to include the appellant's plea of guilty, the fact that he committed the offences in order to pay for his wife's operation and to support his family generally and the fact that the last offence was committed on 28 May 1998 and the complaints were not sworn until April 2000.

29 As to that it is said that delay between the commission of the offences and sentence was not the fault of the appellant and that is a mitigating factor, especially when taking into account the fact that he had commenced a process of rehabilitation. Reference is made to R v Allard (1991) 52 A Crim R 460. Allard, I think, was a rather different case. That was one in which there was a significantly greater delay than here, to the extent that the offences were appropriately described as "stale" offences. I do not think that is a term which could appropriately be applied in the present circumstances.

30 Other factors which are said to operate in a mitigatory way here (or ought to have) include that he had not committed any serious offences for approximately 12 months and had abstained from drinking alcohol for a similar period, had commenced working at the Aboriginal training scheme and had demonstrated motivation and dedication to it.

31 All of these things were, I think, pertinently relevant in mitigation in the circumstances of this case. I do not know that it is possible to say that his Worship erred specifically nor identifiably in respect of any particular one of them, but it does seem to me that the end result of his Worship's disposition does indicate error and it may be that that flowed from, to some extent, undervaluing the mitigatory factors in this case. I am reinforced in this impression by the concession made by the respondent as to the order that the sentences be made cumulative rather than concurrent.

32 I note that in his submissions to me this morning Mr Renton, who appears for the respondent, intimated that in the respondent's view it may well have been the case that the learned Magistrate made that order and effectively imposed the head sentence he did from a perspective of endeavouring to reflect the fact that the appellant had breached a recognisance release order in the past.

33 If that had been the Magistrate's approach then, of course, it would have been wrong because it is trite law that one cannot increase an otherwise appropriate sentence by reason of an offender's previous convictions. They can only go to demonstrate that there is no, or a reduced capacity, for mitigation.

34 It is of course true that there is abundant authority indicating that the courts must take a serious view of social security fraud. In recent times that authority has been extended to be regarded as just as applicable to other revenue offences such as income tax or other tax fraud, but as Ms Williams for the appellant points out, even in cases of serious social security fraud, all mitigating circumstances and the possible rehabilitation of the offender must still be considered and given appropriate weight.

35 In Kovacevic (2000) 111 A Crim R 131, a bench of five judges in the Court of Criminal Appeal in South Australia had cause to consider this particular issue. In the joint judgment of Doyle CJ and Mullighan, Bleby and Martin JJ, their Honours dealt with a submission that a sentencing standard cannot be taken as dictating the result in every case. At 137, their Honours said:

"We agree that a sentencing standard cannot dictate a result in every case or remove the need for consideration of the facts of each case and the application of the relevant considerations to those facts.

It is worthwhile repeating again what Cox J said in King (1988) 48 SASR 555 at 557, 34 A Crim R 412 at 414, a passage that Doyle CJ cited in Cadd:

'In a word, this case is about sentencing standards but it is important I think to bear in mind that when a standard is created, either by cumulative force of individual sentences or by a deliberate act of policy on the part of the Full Court, there is nothing rigid about it. Such standards are general guides to those who have to sentence in the future, with certain tolerances built into or implied by the range to cater for particular cases.'"

36 Their Honours then referred to other authorities to the same effect and at 138 continued:

"We agree with the further submission advanced from Mr Korakis that in a case such as the present, considerations of deterrence cannot displace all other considerations, either at the outset or at the conclusion of the sentencing process. All relevant considerations must be taken into account, and given due weight. The establishment of a sentencing standard by this Court cannot require a judge or magistrate, when imposing sentence, to take into account only one of the considerations relevant to sentencing, be it deterrence or some other consideration. However, consistently with that, it is appropriate for this Court to indicate that a certain type of offending is likely to attract a certain type of punishment, and in particular imprisonment, and to indicate an appropriate sentence range for particular types of offending."

37 Their Honours turned then to a consideration of what King CJ had said in R v Cameron & Simounds (1993) 171 LSJS 305, emphasising that there is generally a need for a firm approach to offences involving sustained and deliberate fraud and that in particular the courts must do what they can to deter such offending. Then (at 138-139) their Honours said:

"We agree that in cases of deliberate and sustained fraud, deterrence must loom large in determining the appropriate sentence. But other matters, especially rehabilitation, must still be considered. We do not agree that deterrence must take priority over all other considerations, at least if that statement means that there is no scope for the court to be influenced by considerations of rehabilitation in finally arriving at the sentence to be imposed. It may well be that King CJ did not mean to exclude considerations of rehabilitation, or mean to say that a sentence of imprisonment, with at least some of it to be served, must be imposed in every case of sustained and deliberate fraud. But his remarks are capable of being read as requiring an order for imprisonment, with at least some of it to be served, in virtually every case, and absent truly exceptional circumstances.

In our opinion the proper approach to sentencing is better reflected by saying that in a case of the type referred to by King CJ, an order for imprisonment, with at least some of the imprisonment actually to be served, is ordinarily likely to be required. This is because the commission of a number of offences of fraud over a period of time makes imprisonment appropriate even for a first offender, because of the seriousness of the offending. The same matters may require that at least part of that term of imprisonment actually be served, even in the case of a person with no previous convictions. But there is still a need to consider all aspects of the matter, and to consider the interests of society and of the offender in the rehabilitation of the offender. Also, in an appropriate case, there may be room for the exercise of mercy and leniency: see Webb v O'Sullivan [1952] SASR 65 at 66, per Napier CJ and Osenkowski (1982) 30 SASR 212 at 212-213; 5 A Crim R 394 at 394-395."

38 There is one further portion of their Honours' judgment in this regard, which I think it apposite to quote here. That occurs at the bottom of 139:

"There is one further thing that should be said. While imprisonment is likely to be required, it is preferable not to say that a case must be exceptional before a different approach is taken. For example, some offenders in this area are persons whose circumstances are extremely difficult, indeed distressing. An offender might be virtually destitute, with dependants to support. An offender might act as a result of domestic pressures that few people could withstand. That might be a circumstance, coupled with other circumstances, that warrants a more merciful approach in imposing sentence, even though it is a circumstance which is not wholly exceptional, because it tends to recur with this type of offending. It is for that reason that it is safer to say that imprisonment is the starting point, rather than that the case must exhibit exceptional features before a court can properly refrain from making an order for imprisonment. In saying this we do not intend to undermine our earlier statement that in cases of sustained and deliberate fraud, imprisonment is likely to be required."

39 Without now canvassing all of the matters put to me and indeed all of the matters before his Worship, it seems to me that some of the more salient considerations are the fact that the offending ceased in May 1998, although it had occurred over a period between late 1997 to mid-1998. The amount was not insignificant but again was, by comparison with other cases of this kind, by no means a particularly high amount.

40 It is I think of particular importance to note here that the situation in which the appellant found himself at the time and in which he committed these offences was one of extreme stress and desperation with respect to the financial support of his wife and family.

41 His previous criminal history included the fact that these offences were committed whilst he was on a recognisance order and it certainly cannot be said that his Worship was wrong to take the view that personal deterrence had to loom large in this case for that reason if no other. However his Worship seems to have moved directly from that conclusion to one that an immediate, fully-served term of imprisonment was the only sentence which would have that effect.

42 In my view his Honour erred in so doing and in the manner described or conceded by the respondent in making the two sentences cumulative. That being so, it falls to me now to re-sentence the appellant. His Honour erred in relation to the perception that, as he put it at AB22, "I would have thought I had no alternative but to impose a custodial sentence," when that was not the inevitable conclusion.

43 That was not the only appropriate means of deterring this offender nor others. Indeed personal deterrence of him was more likely to be achieved, certainly in the short term, by an immediate sentence followed by release on recognisance for the balance of the term. I say that in the context in which the previous recognisance which was breached by him by the commission of these offences did not have a custodial component and I incline to accept the submission made to me that that fact may have had a bearing, at least in the sense that had there been such a consequence of his re-offending it may have been a cause of greater deterrence to him.

44 In the circumstance where there is an immediate sentence of imprisonment followed by a suspension of the balance of the term effectively subject to good behaviour, the offender knows with a degree of certainty what the consequences of any future offending will inevitably be. A suspended sentence, whether subject to a recognisance release order or a suspended sentence proper, is a substantial punishment, see Witnall [1993] FCA 271; (1993) 42 FCR 512, 68 A Crim R 119 per Higgins J at 518 and 125.

45 The court in Kovacevic referred to that observation at 145, pointing out that a similar observation was made by Winneke P in Director of Public Prosecutions (Cth) v Carter (1998) 1 VR 601, 607-708; (1997) 91 A Crim R 222 at 229, when his Honour said:

"The authorities make it clear that it is wrong to assume that a sentence of imprisonment, albeit wholly suspended, does not play a role in deterring others (Elliott v Harris (No 2) (1976) 13 SASR 516 at 527, per Bray CJ; Gillian (1991) 54 A Crim R 745 at 480; P [1992] FCA 626; (1992) 39 FCR 276 at 285; [1992] FCA 626; 64 A Crim R 381 at 391).".

46 It seems to me that in the circumstances a sentence of 12 months' imprisonment would adequately reflect and be proportionate to the offending in this case, bearing in mind the mitigatory circumstances as they have been placed before me and were before his Worship. It seems to me further that the prospects of the appellant's rehabilitation and the interests of the community would best be served had there been a recognisance release order for a period of 2 years stipulating that he be released on recognisance after serving 4 months of that time.

47 I fix the term at 4 months on the basis that in this case the appropriate starting point would be somewhat less than half the head sentence. The recognisance release order would be subject to the conditions that the appellant be of good behaviour and that he be subject to the supervision of a probation officer for 2 years.

48 I would accordingly quash the orders and sentences of the learned Magistrate, substitute a term of 12 months' imprisonment comprising a term of 6 months in respect of each group of offences made cumulative, each of those being a global sentence respectively, and order that the appellant be released after serving 4 months imprisonment on entering into his own recognisance for a period of two years conditioned that he be of good behaviour and be under the supervision and comply with the directions of a probation officer for the period of the recognisance. I would set a surety amount of $1,000.