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DIVISION: Court of Appeal

PROCEEDING: Application for Leave s 118 DCA (Criminal)

ORIGINATING COURT: District Court at Maroochydore

DELIVERED ON: 24 March 2005

DELIVERED AT: Brisbane

HEARING DATE: 4 November 2004

JUDGES: McMurdo P, Fryberg and Mullins JJ Separate reasons for judgment of each member of the Court, each concurring as to the order made

ORDER: Dismiss the application for leave to appeal

CATCHWORDS: CRIMINAL LAW – Appeal and new trial and inquiry after conviction – Application for leave to appeal under s 118 District Court Act 1967 – Social welfare – Social security payments – Overpayments and debt recovery – Failure to disclose relevant information – Where applicant knowingly obtained social security payments which were only payable in part – Whether charges under s 1347 of the Social Security Act 1991 were duplicitous / Social Security Act 1991 (Cth), s 1075, s 1347 Social Security (Administration) Act 1999 (Cth), s 215 S v The Queen (1989) 168 CLR 266, cited

COUNSEL: The applicant was not represented D R Kent for the respondent

SOLICITORS: The applicant was not represented Commonwealth Director of Public Prosecutions for the respondent

[1] McMURDO P: For the reasons given by Fryberg J, the applicant has not demonstrated any grounds to warrant the granting of leave to appeal. I agree with Fryberg J that the application for leave to appeal should be dismissed with no order as to costs.

[2] FRYBERG J: On 26 March 2004 Dodds DCJ dismissed the present applicant’s appeal against his conviction and sentence in the Magistrates Court at Maroochydore on two counts of knowingly obtaining payment of a social security payment which was only payable in part; he was sentenced to 200 hours of community service. The present application is for leave to appeal against that dismissal under s 118 of the District Court of Queensland Act 1967. Before this court the applicant was unrepresented.

[3] The grounds of the application are:

“1.The learned Judge erred in not ruling my entitlement should have been determined by reference to either accrued or receipted and taxable income.

2.The learned Judge erred in finding the charges were not bad in law for duplicity.

3.The sentence is manifestly excessive.

4.The learned Judge erred in not addressing Form 38 Application for Amendment of Community Based Order received by the District Court on 26th March 2004.”

[4] Ground four is misconceived. It emerged during argument in this court that it referred to an application to vary the sentence of community service filed in the District Court after the hearing of the appeal but before the reserved judgment was delivered. That application has apparently not been dealt with by the District Court and no proceedings are on foot to bring it before this court. In any event it was probably misconceived; one would have thought an application to vary a community-based order should have been made to the court which imposed the sentence.¹

[5] Ground one related to a question of fact determined by the magistrate and was disposed of by Dodds DCJ by reference to the evidence before the magistrate. Ground three raised no question of principle in relation to sentence. Neither could support a grant of leave to appeal. Ground two demands more elaborate consideration.

[6] The two counts charged were as follows:

“1Between the 9th of May 1998 and the 19th of March 2000 at Caloundra [the applicant] contrary to section 1350 of the Social Security Act 1991 as amended, contravened S. 1347 of the said Act, in that he knowingly obtained payment of a Social Security payment, namely newstart allowance under the said Act, which was only payable in part.

2Between the 20th of March 2000, and the 5th of May 2000 at Caloundra [the applicant] did contrary to S. 217 of the Social Security (Administration) Act 1999 as amended contravened S. 215 of the said Act in that he did knowingly obtain payment of a social security payment, namely newstart allowance under the said social security law, which was only payable in part.”

The Social Security (Administration) Act 1999 (Cth) replaced some of the relevant provisions of the Social Security Act 1991 (Cth), coming into effect on 20 March 2000. That legislative amendment was the reason for two charges rather than one. It is convenient to consider count one first.

[7] Section 1347 of the 1991 Act provided:

“A person must not knowingly obtain:

(a)payment of a social security payment under this Act or of fares allowance; or

(b)payment of an instalment of a social security payment under this Act;

for which the person is not eligible, or which is:

(c) not payable at all; or

(d) only payable in part.”

Contravention of that section was an offence.² Newstart allowance was a social security payment within the meaning of the Act.³

[8] Only two witnesses, both officers of the Department of Social Security (or Centrelink as its later emanation is called), gave evidence for the prosecution in the Magistrates Court. The applicant, who was then legally represented, neither called nor gave evidence. In many respects the evidence for the prosecution was unchallenged and the magistrate accepted it. It revealed that by a document dated 23 July 1997 and lodged with the Department, the applicant made a claim for the allowance. Presumably the claim was in order, for it was duly determined on 25 August 1997.⁴ The determination was that the claim be granted. That implies that the officer who decided it was satisfied that the applicant was qualified or expected to be qualified for the allowance and that the allowance was payable.⁵ It was paid from that date and there is no suggestion that this was in any way improper at that time. The charges related to the period from 25 May 1998 until 8 May 2000 (inclusive). During that period the applicant received the allowance by fortnightly payments. The amount of each payment increased slightly from time to time over the period, from $290.10 for the first payment to $299.10 for the last payment.

[9] The Act required that the applicant’s allowance rate be worked out using “Benefit Rate Calculator B” at the end of s 1068. The method of calculation was complex; it is enough for present purposes to note that the rates may be lower if an applicant has other income.⁶ The section specified that the rate of the benefit was a fortnightly rate.⁷ The Act also provided that the allowance was to be paid by instalments for periods and at the times determined by the secretary.⁸ Although there was no evidence on the topic, it may be inferred that the secretary (or his delegate) determined a rate payable by fortnightly instalments. The Act also provided that a determination of the rate continued in effect until the allowance became payable at a lower rate under certain nominated sections or until a further determination in relation to the allowance under certain other sections took effect.⁹ Doubtless the increases were attributable to further determinations.

[10] Each fortnight from May 1998 until 11 September 1999, the applicant received a form addressed to him. Except for the last of them, the forms were received fortnightly and were required to be filled in on the last day of the fortnight to which they respectively related. (The last one referred to the period 11 September 1999 to 3 December 1999 and was required to be completed and returned on the latter date.) The forms asked a series of questions. The terms of the questions varied from time to time, but essentially they asked whether the applicant and his partner did any work and got any money during the period covered by the form. Invariably the applicant gave negative answers to these questions. Each form constituted a Recipient Statement Notice under s 658 of the Act.¹⁰ On at least four occasions during the period the subject of the two charges, the applicant received letters which were Recipient Notification Notices under s 657 of the Act. These informed him that he must tell the Department if he or his partner started paid work or any form of profession, trade, business or self-employment or if their income changed from the rate last notified to the Department.

[11] On 2 February 1998 the applicant and his wife purchased a newspaper business at Maleny. They operated that business profitably throughout the periods nominated in the two charges. From commencement to 30 June 1998 the applicant's half-share of the profit was $3,159.83¹¹; in the financial year 1998-99 it was $12,134.75; and from 1 July 1999 until 8 May 2000 it was $9,328.00. His wife received the other half-share of the profits. As a result the answers which he gave to the questions on the s 658 notices were false. At no time did he respond to the s 657 notices by providing the information referred to in them.

[12] Although determinations of the rate of allowance and that the allowance is payable continue in effect until affected by statute or further determination, those determinations do not define whether the allowance is payable nor the rate at which it is payable. Those matters are to be determined objectively, in accordance with the terms of the Act. It was necessary for the prosecution to prove beyond reasonable doubt that the allowance was only payable in part. The prosecution sought to do that by demonstrating that the applicant received more than he ought to have received under the Act. It did that by calculating what the allowance would have been had its determination taken into account an assumed amount of income. That assumed income was calculated by dividing the applicant's share of profits for the three periods referred to above by the number of fortnights in the respective periods. It was necessary to take the applicant's income into account in making the calculation because:

(a)section 1068-A1 required the calculation of a fortnightly rate of allowance in accordance with Benefit Rate Calculator B;

(b)step five of the steps required by module A of that calculator required the application of the income test using module G;

(c)step one of the method prescribed by module G required the working out of the amount of the applicant's ordinary income on a fortnightly basis.

In a style of drafting which unfortunately is only too common, ordinary income was defined to mean income that was not maintenance income or an exempt lump sum (no question of either exception arose in the present case); income, in relation to a person, was defined to mean (so far as was relevant), an income amount earned, derived or received by the person for the person's own use or benefit; and income amount was defined to mean (among other things) moneys or profits.¹² It followed that the applicant's share of the profits was part of his ordinary income.

[13] Those definitions are not the only provisions which affected the determination of the applicant's ordinary income on a fortnightly basis. Section 1072 provided that a reference to a person's ordinary income for a period was a reference to the person's gross ordinary income from all sources for the period calculated without any reduction other than a reduction under Division 1A of the Act. Section 1075 (which is in Division 1A) provided that if a person carried on business his ordinary income from the business was to be reduced by losses and outgoings that related to the business and were allowable deductions for the purposes of certain sections of the taxation law.

[14] The consequence of this is that it is not possible to determine a person's ordinary income in cases to which s 1075 applies until after the end of the person's financial year. That is because deductions under the tax law are available in respect of a financial year. For most people that year ends on 30 June. In most cases to which that section applies it follows that it is not possible to calculate the precise rate of the allowance in advance. The calculation can be done only after the end of the financial year. It involves reducing the person's gross annual income by the amounts specified in s 1075 and then complying with step one under s 1068-G1, namely working out the amount of ordinary income on a fortnightly basis. I see no reason why this should not be done by dividing the annual amount by 26, which was what occurred in the present case in respect of 1998-99.

[15] Counsel for the respondent submitted that it was permissible to average income under s 1073. If that were so the calculations upon which the prosecution relied to demonstrate that the allowance was only payable in part would be falsified, for the section does not seem to have been applied in those calculations. Its effect is to spread income evenly over the 52 weeks commencing with the week of receipt of the amount to which it applies. That would mean that much of the income attributed to 1998-99 might have had to have been attributed to 1999-2000. Moreover it would have been necessary to apply the section to each individual receipt. None of that was done in the calculation. However the section applies only to amounts which are not ordinary income from remunerative work undertaken by the person. Mr Kent, for the respondent, submitted that a share of partnership profits was not within the description “income from remunerative work”. He submitted that remunerative work was work for which a direct payment was made and referred to the Oxford Dictionary definition of “remunerate”. He submitted that the expression could not apply to the income of a self-employed person or partnership profits. No authority was cited for this proposition and it seems an unlikely construction of the expression if one has regard to its use in (for example) s 630AA. One wonders, if that were the meaning of the term, why the expression “employment income” was not used, having regard to its definition in s 8(1A). In my judgment the applicant's share of profits earned from operating the business was ordinary income from remunerative work, with the consequence that s 1073 did not apply to it.

[16] The foregoing conclusions do not exclude the possibility of a person “knowingly” obtaining payment of the allowance in contravention of s 1347 before the end of the relevant financial year in cases to which s 1075 applies. A person may well know in the course of the year (particularly toward the end of the year) that when his annual accounts are prepared they will certainly disclose a level of income sufficient to affect either the level of his allowance or whether he is entitled to the allowance. Such knowledge is not negated merely by the existence of speculative possibilities which might reduce the amount of his ordinary income before the end of the financial year. In the present case the false answers which the applicant gave in the fortnightly forms described above¹³ were sufficient to found the inference which the magistrate drew.

[17] Nor do the foregoing conclusions demand precise proof of the whole year profit and loss figures as a foundation for a prosecution such as occurred in this case. What is required is evidence from which inferences may be drawn which lead to the conclusion beyond reasonable doubt that the allowance was payable only in part. In the present case the transcript of proceedings shows that the prosecution had, but did not tender, the profit and loss figures for the applicant's business for 1999-2000. It would have been better had these figures been tendered; there would have been less scope for doubt. What the prosecution tendered was a letter from the applicant to the Department written on 19 May 2000 in which he estimated the probable taxable income for himself and his wife for the period 1 July 1999 to 8 May 2000 at $9,328.00 each, a figure of which he wrote, “although difficult to accurately judge, it would be close to the mark, if not less.” It was open to the magistrate to infer the applicant’s net income from that evidence, particularly when he did not give evidence himself. There was no challenge to the correctness of the inference in the submissions to this court.

[18] At this point it is convenient to turn to the question of duplicity. Mr Hyde submitted that the general principle was that no one count in any complaint may charge a person with the commission of more than one offence. That statement of the principle may be accepted for the purposes of the application. The reason for the rule has changed over time:

“The rule against duplicitous counts in an indictment originated as early as the seventeenth century. See, e.g., Smith v. Mall (1623) 2 Rolle 263 [81 ER 788]; R. v. Stocker (1696) 5 Mod 137 [87 ER 568]. It may be, as suggested by Salhany in "Duplicity - Is the Rule Still Necessary?", (1963) 6 Criminal Law Quarterly, vol.6 (1993) 205, at pp. 206-207, that the rule grew out of the strict formalities associated with criminal pleadings at a time when the difference between misdemeanour and felony was the difference between life and death. However, the rule against duplicitous counts has, for a very long time, rested on other considerations. One important consideration is the orderly administration of criminal justice. There are a number of aspects to this consideration: a court must know what charge it is entertaining in order to ensure that evidence is properly admitted, and in order to instruct the jury properly as to the law to be applied; in the event of conviction, a court must know the offence for which the defendant is to be punished; and the record must show of what offence a person has been acquitted or convicted in order for that person to avail himself or herself, if the need should arise, of a plea of autrefois acquit or autrefois convict. See, generally, R. v. Sadler (1787) 2 Chit 519; R. v. Hollond (1794) 5 TR 607, at p. 623 [101 ER 340, at p.348], per Lord Kenyon C.J. at p 623 (p 348 of ER). See, as to the need for distinct consideration in relation to penalty, R. v. Stocker; R. v. Sadler; R. v. Morley (1827) 1 Y. & J. 221 [148 ER 653]; Cotterill v. Lempriere (1890) 24 QBD 634, per Lord Coleridge C.J. See, as to the availability of a plea in bar, R. v. Robe (1735) 2 Str 999 [93 ER 993]; Davy v. Baker (1769) 4 Burr 2471 [98 ER 295]; R. v. Wells; Ex parte Clifford (1904) 91 LT 98; R. v. Surrey Justices; Ex parte Witherick (1932) 1 KB 450.

The rule against duplicitous counts has also long rested upon a basic consideration of fairness, namely, that an accused should know what case he or she has to meet. See, for example, R. v. Robe, at p 999 (p 994 of ER) where it was said "this is so general a charge, that it is impossible any man can prepare to defend himself on this prosecution ... ". See also R. v. Hollond, per Lord Kenyon C.J. at p 623 (p 348 of ER); R. v. North (1825) 6 Dowl & Ry 143, at p 146 (28 RR 538, at p 541); R. v. Morley, at pp 224-225 (p 654 of ER); and Cotterill v. Lempriere, per Lord Esher M.R. at p 639. Of course, the degree of unfairness or prejudice involved will vary from case to case, and it may be, as suggested by Professor Glanville Williams in "The Count System and the Duplicity Rule", [1966] Criminal Law Review 255, at p 264, that on occasions the uncertainty is not "such as to disable the defendant from meeting the charge".¹⁴

[19] Mr Hyde further submitted that while any single overpayment in any given fortnight could give rise to a charge, count one in effect charged a general deficiency. He further submitted that, given earnings in any particular fortnight would affect his entitlement to a payment (and by implication, the amount of the payment), the issue as to whether the payment was “only payable in part” would fall to be assessed on a fortnight to fortnight basis. For these propositions he relied upon the decision of the High Court in Walsh v Tattersall¹⁵. In that case the appellant was charged with obtaining payments or benefits by dishonest means. Under s 120 of the Workers Rehabilitation and Compensation Act 1986 (SA), any person who obtained by dishonest means any payment or other benefit under the Act was guilty of an offence. The majority of the court interpreted that section as creating a separate offence for each payment or benefit obtained. Gaudron and Gummow JJ held that as a consequence the complaint was bad in law (because it charged a non-existent offence) and Kirby J held that in consequence it was duplicitous. The first question in the present case is, does s 1347 of the Social Security Act 1991 mandate a similar interpretation.

[20] In my judgment it does not. Examination of the section shows that it creates nine different breaches of the Act. The position in relation to the fares allowance may be put to one side; those three breaches do not arise in the present case. For the same reason, so may the four offences involving non-eligibility or non-payability. What remains are two breaches: knowingly obtaining payment of a social security payment payable only in part and knowingly obtaining payment of an instalment of a social security payment payable only in part. The existence of those two breaches distinguishes the section from that under consideration in Walsh v Tattersall. Under the Social Security Act 1991 the allowance must be paid by instalments.¹⁶ Separate payments of the allowance can therefore constitute only the whole or part of an instalment.¹⁷ Whatever may be the position with regard to payments of part of an instalment, knowingly obtaining payment of the whole of an instalment which was only payable in part is explicitly a separate offence from knowingly obtaining payment of newstart allowance which was only payable in part. There is therefore no reason to construe s 1347(a) as creating a separate breach in respect of each payment of the allowance received by the applicant. On the contrary, it should be given a construction which allows the words of para (a) scope for operation.

[21] There is in my view no obstacle to regarding that provision as creating one continuing breach constituted by a number of separate acts which together satisfy the element of obtaining. So construed no question of duplicity arises and paragraph (a) has meaningful work to do. That is the construction which I favour. In any event I am satisfied that in the circumstances of this case none of the purposes for which the rule exists is enlivened; but it is unnecessary to expand upon the consequences of that.

[22] One other possible construction of s 1347 should be referred to, as it was raised in the course of argument. It was suggested that in cases to which s 1075 applies, s 1347(a) should be construed so as to create a separate breach for each financial year. Such a construction would give that section work to do and would be congruent with the method of calculation of the rate of allowance involving s 1075. There is however little merit in such a construction. In most cases involving more than one financial year the conduct alleged to constitute the breach of s 1347(a) will form one continuous course of similar actions. In such cases there is no point in splitting the conduct into more than one offence. No particular benefit from taking that course is demonstrable. I would reject such a construction.

[23] Count 2 depended upon the provisions of the Social Security (Administration) Act 1999. Those provisions were not materially different from those contained in the 1991 Act. The foregoing discussion applies equally to them.

[24] That is sufficient to dispose of the application on the grounds advanced by the applicant. However one other point should be mentioned. It appears from the material placed before this court that through inadvertence, no plea was ever taken by the magistrate. If that is right there was a breach of s 145 of the Justices Act 1886. Differing opinions have been expressed about the consequences of such a breach.¹⁸ This case should serve as a timely reminder of the need to comply with the section. In the present case the non-compliance if any could not possibly have brought about any miscarriage of justice. That being so a grant of leave to appeal on this ground would be unwarranted.

[25] For the foregoing reasons an appeal would in my judgment have no prospects of success. I would therefore dismiss the application for leave. In view of the fact that it raised a question of general importance relating to the construction of the Social Security Act 1991, and because the respondent was not successful on all points argued, I would make no order as to costs.

[26] MULLINS J: I agree that the application for leave to appeal should be dismissed and there should be no order as to costs for the reasons given by Fryberg J.