Josefski v Donnelly & Ors [2007] VSCA 6

Bankruptcy Act 1966 (C'th) s 40(1)(g).

Victims of Crime Assistance Act 1996 s 13(1)(c).

Judgment Debt Recovery Act 1984 s 6.

1 I will ask Nettle JA to deliver the first judgment.

2 On 30 March 2005 the applicant, Phillip Josefski, pleaded guilty before the County Court at Melbourne to one count that on 14 July 2002 he did fail to stop his motor vehicle after it was involved in an accident that resulted in the death of James Donnelly (count 1), one count that after the accident he did fail to render assistance to the said James Donnelly (count 2) and one count that between 14 July 2002 and 22 October 2002 he did with his parents agree to provide false information to the police in an attempt to pervert the course of justice (count 3).

3 Following a plea in mitigation of penalty, on 11 April 2005 the judge sentenced the applicant on each of counts 1 and 2 to terms of imprisonment of 12 months and on count 3 to a term of imprisonment of 15 months; ordered that the sentences imposed on counts 1 and 2 be served concurrently and that the sentence imposed on count 3 be served cumulatively on the sentences imposed on the other counts, thereby making for a total effective sentence of two years and three months' imprisonment; and directed that the applicant serve a minimum of 10 months' imprisonment before becoming eligible for parole, and that his driver's licence be cancelled and he be disqualified from obtaining a licence for three years. On appeal to this Court, the non-parole period was increased to 18 months.

4 Following the applicant's conviction, the respondents applied, pursuant to s 85B of the Sentencing Act 1991, for an order for compensation for the pain and suffering experienced by them as a direct result of the offences, and on 19 June 2006 that application came on for hearing before another judge of the County Court.

5 On 30 June 2006 the judge handed down a decision that the applicant should pay to each of Kevin Donnelly and Julia Donnelly compensation in the amount of $50,000 and should pay to Amelia Donnelly compensation in the amount of $55,000. As the judge observed, however, the respondents had by then obtained orders in the Magistrates' Court at Melbourne, pursuant to s 13(1)(c) of the Victims of Crime Assistance Act 1996, for financial assistance for distress experienced or reasonably likely to be experienced as a direct result of the death of James Donnelly,[1] and s 85I of the Sentencing Act required that any amounts of compensation for pain and suffering allowed pursuant to s 85H of that Act must be reduced by the amounts of compensation for distress provided under the Victims of Crimes Assistance Act. So, after allowing for the compensation for distress allowed under the Victims of Crimes Assistance Act, the judge ordered that the applicant pay to each respondent a sum of $20,000, which is to say a total of $60,000.

6 The applicant now seeks leave, pursuant to s 567D of the Crimes Act 1958, to appeal against those orders on grounds that the orders are so great in amount as to be penal; that the judge erred in failing to give sufficient weight to the applicant's poor financial circumstances; that the orders constitute a crushing financial burden and thereby harm the applicant's prospects of rehabilitation; that the orders are manifestly excessive and thus ill accord with current sentencing practices; and that the orders allow compensation quantified as if the applicant had been convicted of culpable driving as opposed to the lesser offences of which he was in fact convicted.

Ground 1: Compensation was penal

7 The thrust of the applicant's argument in support of the first ground of appeal is that the judge was in error in rejecting or failing to give sufficient weight to a submission that the applicant had extremely limited financial means, and in particular in failing to give sufficient weight to evidence that the applicant had been released on home detention and so had NewStart allowance as his only source of income, and that his only assets were a unit in Brunswick, which had been sold to pay his legal costs, $30,000 held by the court pending these proceedings, and $39,000 held by his parents to pay capital gains tax on the sale of the unit.

8 I do not accept that argument. The judge made clear that she had considered the submissions put on behalf of the applicant as to his financial circumstances, but she said that there was insufficient evidence before her to enable her to reach a concluded view about his financial position. As her Honour put it in her conclusions:

"After hearing the evidence and submission in relation to the applicant's financial circumstances, it is my view that the respondent and his father attempted, as best they could on the information they had put before the court, the present situation that he faced financially, that there was little real certainty as one might expect in regard to his future earnings. It is also unclear what will be his tax liability for past years of 2002-3, 2003-4 and 2005-6, as well as capital gains tax on the sale. All in all, it is not a matter of reaching final conclusions of fact on the scant material I have, but rather to have a general picture of his likely position. Even if it is accepted that there is a figure of about $30,000 unaccounted for, given the other uncertainties as to his debts, it does not make his future position significantly different. There is little doubt he will take some time before he re-establishes an income and little doubt that he has no savings of any significance beyond the figures mentioned. [scil. the $30,000 held by the Court and the $39,000 held by his mother for capital gains tax.]"

As the judge observed correctly, s 85A(1) allows the court to take into account the financial circumstances of an offender in order to determine the amount and method of payment of compensation, but the court cannot do so if it is unaware of the offender's financial circumstances. Thus, s 85A(2) provides that the court is not prevented from making a compensation order only because it has been unable to find out the financial circumstances of the offender.

9 Counsel for the applicant argued in the alternative that the judge should have accepted what the applicant said about his financial position, despite her Honour's view that there was insufficient cogent evidence to make the position clear, and thus that her Honour was in error.

10 I do not accept that contention either. Plainly, the judge was entitled to conclude that the evidence was not sufficient to enable her to reach a concluded view about the applicant's financial position. After all, both the applicant and his father stood convicted of providing false information to the police in an attempt to pervert the course of justice in relation to the matter that was before her. The judge had reason to be sceptical about what they had to say.

11 Counsel for the applicant further argued that the judge's order was penal because it failed to provide any guidance as to how the award was to be paid or as to whether the respondent may apply to bankrupt the applicant for failure to pay the amount of compensation ordered, or as to the future income threshold at which the applicant will be obliged to begin paying compensation.

12 In my view that argument is not persuasive either. The order is that the applicant pay a sum certain of compensation. Section 85M of the Sentencing Act provides that such an order must be taken to be a judgment debt due by the offender to the person in whose favour the order is made and payment of any amount remaining unpaid under the order may be enforced in the court by which it is made. That being so, I see no reason to doubt that the person in whose favour such an order has been made may serve a bankruptcy notice on the offender requiring that it be paid and that failure to comply with such a notice would be an act of bankruptcy within the meaning of s 40(1)(g) of the Bankruptcy Act 1966 (C'th). Equally, however, I see no reason to doubt that such a compensation order may be regarded as a judgment debt within the meaning of the Judgment Debt Recovery Act 1984 and so be the subject of an application for an instalment order pursuant to s 6 of that Act.

13 In the circumstances, the fact that an offender may lack capacity to pay a compensation order no more renders the order penal than does the fact that a judgment debtor lacks the wherewithal to pay a judgment debt render the debt a penalty.

14 Counsel for the applicant stressed the importance of observations made by a number of single judges of the Trial Division to the effect that a compensation order is intended to be compensatory and not penal. No doubt that is so. If the judge had formulated the order as a penalty there would have been reason for complaint. But the judge made plain that she regarded her task as being one to determine the compensation that was appropriate for any injury which arose out of the offences and not to punish the applicant for what he had done.

Ground 2: Inability to pay compensation

15 Under ground 2, counsel for the applicant reiterated the submission that the judge failed to give sufficient weight to what was said to be the deprived financial circumstances of the applicant and had thus imposed an order for compensation which was excessive.

16 As far as I can see, that really adds nothing to what had already been said about the judge's assessment of the applicant's financial position and the effects upon a person in that position of the order that was made.

Ground 3: Rehabilitation

17 In support of ground 3, counsel for the applicant submitted that the quantum of the order was so great as to impose a crushing financial burden on the applicant and thus to harm his prospects of rehabilitation. Hence, it was said that the judge was in error in failing to moderate the compensation order so as to accommodate the difficult circumstances which the applicant faces in establishing a reasonable income stream in future.

18 Apart, however, from the matters already dealt with concerning the judge's assessment of the applicant's financial position, a fundamental difficulty with that submission is that the judge expressly recognised the possible effects of the order on the applicant's prospects of rehabilitation and quantified the order having regard to those effects. As the judge put it:

"I agree with Mr Justice Cummins in Director of Public Prosecutions v. Robert Clive Parsons[2] when he expressed the view that there are inherent tensions in applying these provisions whereby the compensation order may be antipathetic to the rehabilitation of an offender where it becomes a crushing burden. It is true that s 85(1) is a potential restriction to the quantum of compensation, but at the same time sub-s (2) makes it plain that an order can be made even where no financial circumstances are known. In my view, in circumstances where there is material before a court which to some degree outlines the present and future prospective financial situation of a respondent as in this case, it is appropriate although not determinative to take into account the respondent's ability to meet any compensation order, and I propose to do so in this case."

19 I reject the contention that the amount of the order was plainly so great that the judge must have failed to give due weight to the effects of the order on the prospects of rehabilitation.

Ground 4: Manifest excessiveness and comparison with other cases

20 Under ground 4, counsel for the applicant argued that the amount of the award of compensation so much ill accorded with the amounts of orders made in other similar cases that it should be regarded as manifestly excessive, and he referred, amongst other decisions, to Gregory,[3] Esso Australia[4] and Energy Brix.[5]

21 I reject that submission for two reasons. First, as Vincent JA explained in Energy Brix:

"The broad definition of 'victim', inclusion of the terms of 'grief, distress or trauma or other significant adverse effect' within the definition of 'injury', and the extension of the notion of mental illness or disorder beyond that recognised by the common law which is suggested by s 85A(b), indicates that Parliament intended that the focus of attention should be placed upon the actual impact upon an applicant of the commission of the offence, rather than whether that impact could be the subject of an award of common law damages. It follows that, whilst some assistance could be derived from the comparison of awards made in other circumstances, care must be exercised to ensure that the possible differences are not overlooked."[6]

It is plain from the judge's reasons for decision in this case that her Honour approached her task in accordance with that precept and tailored the amount of compensation payable to the injury suffered by the respondents as she assessed it.

22 Secondly, I am unable to discern such a degree of difference between the amounts of compensation ordered to be paid in this case and amounts ordered in the other cases mentioned as would suggest that the judge's assessment in this case was manifestly excessive. To the contrary, when one has regard to the evidence to which the judge referred of the profound effects of the applicant's offences on the respondents, and the effects which as a matter of intuition and experience one might expect the offences to have had on the respondents, it seems to me that her Honour's assessment was well within the range.

Ground 5: Compensation awarded for offence of which the applicant not convicted

23 Finally, counsel for the applicant argued that it was apparent from the amounts of compensation ordered to be paid that the judge had assessed the compensation by reference to pain and suffering caused by the death of James Donnelly, as opposed to any pain and suffering which may have been caused by the fact that the applicant left him to die, without assistance, and conspired with others to prevent the cause of his death being discovered.

24 In my view, that submission fails in limine. The judge stated in her reasons that she approached the task of assessment on the basis that:

"...the court's task was to determine what was the compensation that was appropriate for any injury which arises out of the offences of failing to stop, failing to render assistance and perverting the course of justice, as opposed to any injury they may have suffered as a result of the death because the respondent was not charged with culpable driving. In other words, the claim does not rely on any effect of the death of James Donnelly, but rather what is claimed to have been significant grief, distress and trauma from the fact that the respondent, after hitting the deceased, left him to die on the side of the road, and to die in that state alone, and did nothing by way of assisting him, and, further, for the greater part of the following two-and-a-half years, conspired with his parents not to admit that he was involved in the accident, and, but for the police investigation and forensic work, his identity would have remained unknown."

25 Counsel for the applicant nevertheless argued that if in truth one excluded from the equation the effect of suffering caused by the death of James Donnelly, the suffering caused by the fact that the applicant left James Donnelly to die without assistance and sought to obscure his involvement could, as a matter of logic, be no more than the suffering which would have been caused if the applicant had simply broken the deceased's leg and left him unattended.

26 I reject that submission too. The answer to it, in my view, which also emerges from the judge's analysis, is that anguish caused to the respondents by the fact that their son and brother was left to die without assistance was likely to exceed any anguish which they may have suffered if the deceased had simply been left with a broken leg that did not kill him. True it is that the applicant's proven criminal culpability may have been no greater than that of a hit-run driver who leaves a victim with nothing worse than a broken leg. But, as has already been observed, the order for compensation was not to punish the applicant for the extent of his criminal liability. It was to compensate the respondents for the effects on them of the applicant's offences. And, in those circumstances, just as a tortfeasor must take his victims as he finds them, the applicant must take his victims as they were affected by his crime.

27 The fact is that the applicant left the deceased to die of mortal injuries and conspired to obscure his involvement in that act. It was the effect of those actions on the respondents, not those of an offender who left a victim with nothing worse than a broken leg, that fell to be assessed. For the reasons already expressed, the effects of the applicant's actions on the respondents were likely to be greater than might have been the effect of leaving a victim with nothing worse than a broken leg. It was only to be expected, therefore, that the amount of compensation properly payable was greater than it would have been if the deceased had lived.

Conclusion

28 In the result, I would refuse the application for leave to appeal.

31 The order of the Court is that leave to appeal against the compensation orders made on 30 June 2006 is refused.

[1] In the case of the respondent Amelia Donnelly, in the sum of $35,000; in the case of the respondent Kevin Donnelly, in the sum of $30,000 for distress; and in the case of the respondent Julia Donnelly, also in the sum of $30,000.

[2] [2002] VSC 327.

[3] Gregory v Gregory [2000] VSC 190.

[4] Esso Australia Pty Ltd v Norman Robertson [2005] VSCA 138.

[5] DPP v Energy Brix Aust Corp Pty Ltd [2006] VSCA 116.

[6] Ibid at [31].