Moreno v R; Gomez v R

Court of Criminal Appeal (NSW)|2023-05-12|Before: Ward P, Beech-Jones CJ, Price J

Solicitors: James & Jaramillo Lawyers (Mr Moreno) King & York Lawyers (Mr Gomez) Solicitor for Public Prosecutions (NSW) (Respondent) File Number(s): 2020/217602; 2020/217611 Decision under appeal Court or tribunal: District Court Jurisdiction: Criminal Date of Decision: 25 February 2022 Before: Hock DCJ File Number(s): 2020/217602; 2020/217611

HEADNOTE [This headnote is not to be read as part of the judgment] On 25 February 2022, Jose Moreno Gomez was sentenced to 6 years and 9 months imprisonment with a non-parole period of 4 years and 4 months for 1 count of supplying not less than the commercial quantity of a prohibited drug (being 15kg of "cocaine") contrary to s 25(2) of the Drug Misuse and Trafficking Act 1985 (NSW) ("DMTA") (the supply offence) and 1 count of dealing with property reasonably suspected to be the proceeds of crime (being $340,950 in cash) contrary to s 193C(1) of the Crimes Act 1900 (NSW) (the proceeds of crime offence). Other offences were also included on a "Form 1". On the same day, Jhonattan Giraldo Moreno was sentenced to 5 years and 3 months imprisonment with a non-parole period of 3 years and 4 months for 1 count of supplying not less than the commercial quantity of a prohibited drug (being 15kg of "cocaine") contrary to s 25(2) of the DMTA (the supply offence). Other offences were also included on a "Form 1", being one charge of supplying a prohibited drug (3.1 grams of cocaine) contrary to s 25(1) of the DMTA and one charge of possessing a prohibited drug (4.5 grams of cocaine) contrary to s 10(1) of the DMTA. Mr Moreno is Mr Gomez's nephew. Both are Colombian nationals. Mr Moreno arrived in Australia in 2015 and Mr Gomez arrived in 2019. The offending related to the supply of a large commercial quantity of what they represented to undercover police operatives to be 15kg of cocaine. In fact, the applicants supplied sugar and wood disguised as cocaine but by operation of s 40(1) of the DMTA they were taken to have agreed to supply a prohibited drug. In 2020, the applicants engaged in a series of communications with undercover police about the supply of a large amount of cocaine for $1 million. This included meetings on 2 June 2020 and 7 July 2020 where, on the latter occasion, Mr Moreno gave a sample of the cocaine to be provided to an undercover officer ("Sam") (being the Form 1 supply offence for both applicants). On 24 July 2020, the applicants and Sam negotiated the sale of 15kg of cocaine for $1.5 million in cash. Later that afternoon they met in the carpark of a shopping centre. After the fake cocaine and cash to be exchanged were shown, police arrested the applicants (as well as a co-offender) and seized the fake cocaine. A search of Mr Gomez and the applicants' apartment revealed a small knife on Mr Gomez, a total of $340,950 in cash and 3.4 grams of cocaine in Mr Moreno's bedroom. These formed the basis of the balance of Mr Gomez's Form 1 offences and Mr Moreno's Form 1 possession offence. The sentencing judge found that Mr Gomez was the "principal" and his offending fell "at the mid-range of objective gravity". The sentencing judge found Mr Moreno's offending to be "just below the mid-range". The principal issues on appeal were:

whether the sentencing judge erred in assessing the objective seriousness of each applicant's offences (the objective seriousness issue);
whether the sentencing judge failed to take into account the effect of COVID-19 in creating more onerous prison conditions beyond visitation restrictions in sentencing (the COVID-19 consideration issue); and
whether Mr Moreno's sentence was manifestly excessive (the manifest excess issue). The Court held (per Beech-Jones CJ at CL, Ward P and Price J agreeing), allowing leave to appeal but dismissing the appeal: As to the objective seriousness issue
So-called "drug rip-off" supply offences are objectively serious. They are not to be equated with fraud. The criminality involved is not determined by the amount an offender seeks to defraud the purchasers or gain for themselves. The applicants' criminality was their agreement to supply what they represented to be a prohibited drug, and a significant aspect of their criminality was the amount of drug they agreed to supply. The fact that the proposed purchasers were undercover operatives does not lessen the applicants' moral culpability nor detract from the rationale that deterring "drug rip off" cases generally will serve the objective of "not allowing the drug trade to be used as a vehicle for fraudulent activities": [46], [48], [52] (Ward P and Price J agreeing at [1] and [69]).
Given the size and scope of the transaction, the period of time over which it was negotiated and the elaborate steps the applicants took to give effect to it, it cannot be said that the sentencing judge's assessments of the objective seriousness of the applicants' offences were not "open" nor unreasonable: [56] (Ward P and Price J agreeing at [1] and [69]). Mulato v R [2006] NSWCCA 282; Khoury v R [2020] NSWCCA 190, applied. House v The King (1936) 55 CLR 499; [1936] HCA 40; Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40; R v Kijurina [2017] NSWCCA 117; R v Yaghi (2002) 144 A Crim R 490; [2002] NSWCCA 396; Kada v The Queen [2017] VSCA 339; (2017) 270 A Crim R 197, considered. As to the COVID-19 consideration issue
The sentencing judge gave express consideration to the "current conditions for prisoners" which was not confined to restrictions on personal visits: [62] (Ward P and Price J agreeing at [1] and [69]) As to the manifest excess issue
Notwithstanding his strong subjective case, Mr Moreno's sentence was not manifestly excessive having regard to the finding of objective seriousness and the maximum sentence (being life imprisonment) and standard non-parole period (being 15 years imprisonment) for the offence: [66] (Ward P and Price J agreeing at [1] and [69]). Dinsdale v The Queen (2000) 202 CLR 321; [2000] HCA 54, applied.

JUDGMENT

WARD P: I agree with Beech-Jones CJ at CL.
BEECH-JONES CJ at CL: Each of the applicants, Jose Moreno Gomez and Jhonattan Giraldo Moreno, seek to leave to appeal from sentences imposed for the supply of a large commercial quantity of what they represented to an undercover police officer to be 15kg of cocaine. In fact, they never intended to supply cocaine and instead supplied sugar and wood disguised as cocaine. The principal complaint made on behalf of both applicants is that the sentencing judge failed to take into account, or failed to sufficiently take into account, the fact that they never intended to supply a prohibited drug and that the proposed purchasers were undercover operatives. For the reasons that follow, I do not accept that contention or the other complaints made about the sentence that was imposed. I propose that leave to appeal be granted in each case but the appeals be dismissed.

The Sentences

On 28 January 2022, Mr Gomez appeared for sentence before her Honour Judge Hock. He adhered to pleas of guilty that he entered in the Local Court to an offence of supplying not less than the commercial quantity of a prohibited drug (being 15kg of "cocaine") contrary to s 25(2) of the Drug Misuse and Trafficking Act 1985 (NSW) (the "supply offence" and "DMTA" respectively) and dealing with property reasonably suspected to be the proceeds of crime, specifically $340,950.00 in cash, contrary to s 193C(1) of the Crimes Act 1900 (NSW) (the "proceeds of crime offence").
The supply offence carries a maximum penalty of life imprisonment and a standard non-parole period of 15 years imprisonment (DMTA, s 33(3)(a); Crimes (Sentencing Procedure) Act 1999 (NSW), Item 19 of Table to Pt 4, Div 1A; the "Sentencing Act"). The proceeds of crime offence carries a maximum penalty of 5 years imprisonment (Crimes Act, s 193C(1)). Associated with the supply offence were two offences listed in a notice filed by the prosecutor under s 32(1) of the Sentencing Act (i.e. a "Form 1"), being a charge of supplying a prohibited drug (3.1 grams of cocaine) contrary to s 25(1) of the DMTA and a charge of having custody of a knife in a public place contrary to s 11C(1) of the Summary Offences Act 1988 (NSW). The maximum penalties for these offences are 15 years and 2 years imprisonment respectively (DMTA, s 32(g); Summary Offences Act, s 11C(1)).
On 25 February 2022, her Honour Judge Hock sentenced Mr Gomez to imprisonment for 6 years and 9 months with a non-parole period of 4 years and 4 months. The sentence was fixed to commence on 24 July 2020. Subject to intervention by this Court, Mr Gomez will be first eligible for release on parole on 23 November 2024. Pursuant to s 53A(2)(b) of the Sentencing Act, her Honour indicated sentences of imprisonment for 6 years with a non-parole period of 4 years for the supply offence and imprisonment for 18 months for the proceeds of crime offence.
Mr Moreno was sentenced at the same time as Mr Gomez. Like Mr Gomez, Mr Moreno also adhered to a plea of guilty he entered in the Local Court to an offence of supplying not less than the commercial quantity of a prohibited drug (being 15kg of "cocaine") contrary to s 25(2) of the DMTA. Attached to that offence on a Form 1 was a charge of supplying a prohibited drug (3.1 grams of cocaine) contrary to s 25(1) of the DMTA and another charge of possessing a prohibited drug (4.5 grams of cocaine) contrary to s 10(1) of the DMTA. The maximum penalty for the possession charge is 2 years imprisonment (DMTA, s 21).
Mr Moreno was sentenced to imprisonment for 5 years and 3 months with a non‑parole period of 3 years and 4 months. His sentence was also fixed to commence on 24 July 2020. Subject to intervention by this Court, Mr Moreno will be first eligible for release on 23 November 2023.

Agreed Facts - Mr Gomez

Placed before the sentencing judge was a set of agreed facts relating to each of Mr Gomez and Mr Moreno. There were some differences between the two statements which I will outline.
Mr Gomez is a Colombian national born in 1970. He arrived in Australia in December 2019 on a bridging visa. Mr Moreno is Mr Gomez's nephew. Mr Moreno was born in 1991 and has been living in Australia on a student visa since around 2017. Upon his arrival into Australia, Mr Gomez moved into an apartment which was occupied by Mr Moreno and a third co-offender, William Riano, who was another Colombian national present in Australia on a student visa. Mr Riano moved out of the apartment upon Mr Gomez's arrival.
Between 22 May and 1 June 2020, police "covertly communicated" with "unknown persons" who represented that they could supply a large amount of cocaine. A meeting was arranged for 2 June 2020. On that day, an undercover police officer met with Mr Moreno and Mr Gomez at a public park and discussed the supply and purchase of a commercial quantity of cocaine for $1 million. Over the following month, there were further communications with undercover police about the proposed supply.
On 7 July 2020, Mr Moreno and Mr Gomez met another undercover officer ("Sam") at a shopping centre. Mr Moreno gave Sam a sample of the cocaine that would be provided, being 3.1 grams of cocaine with a 79.5% purity. This was the supply offence included on a Form 1 for both offenders. Sam showed them a picture of a large amount of cash and provided them with an encrypted telephone.
The agreed facts record that between 7 and 23 July 2020, either "Mr Moreno or Mr Gomez" engaged in further communications with undercover police about the supply of cocaine for $1 million using the encrypted phone. In one of those communications, Sam received a direction to place $300,000 of the purchase price into a separate bag.
On 24 July 2020, Mr Gomez, Mr Moreno and Sam negotiated the sale of 15 kilograms of cocaine for $1.5 million in cash. Mr Moreno and Mr Gomez suggested to Sam that they meet at the same location as the "last meet", being the shopping centre. Sam suggested meeting at 5pm that same day.
The agreed facts record that immediately following these communications, Mr Moreno called Mr Riano and urged him to come quickly "as they had someone believing their plan". The facts note that, in a record of interview with police following his arrest, Mr Riano explained that Mr Moreno had told him he had a plan which "would make a lot of money and not be illegal" and involved disguising sugar to appear like cocaine. Mr Riano said he had "participated in a similar ruse either in late December 2019 or January 2020".
Later in the afternoon of 24 July 2020, Mr Moreno, Mr Gomez and Mr Riano met in the carpark of the shopping centre. Mr Moreno and Mr Gomez received a message from Sam telling them that he had arrived. Mr Moreno and Mr Gomez provided Mr Riano with a sports bag that contained 15 blocks of wood and sugar. The three of them walked to meet Sam and another undercover police officer ("Alex"). The two groups pursued the various manoeuvres necessary to execute a substantial drug deal. At one point, Mr Gomez and Mr Riano walked over to Sam and Mr Gomez gestured to Mr Riano to open the sports bag. Mr Riano opened the bag and showed him the contents. Mr Gomez and Sam then walked over to Sam's vehicle and Alex showed Mr Gomez the cash to be handed over for the sale. Police then arrested Mr Gomez and Mr Riano. Mr Gomez shouted, "It's sugar! It's sugar!".
A search of Mr Gomez by police revealed that he was in possession of a small knife, which was the basis for the knife possession offence included on a Form 1. The search also yielded $1,350 in cash and keys to an apartment. A search of the apartment yielded a further $339,600 in cash. The cash found on Mr Gomez and in his apartment was the basis for the proceeds of crime offence to which he pleaded guilty. In Mr Moreno's bedroom, police found 4.5 grams of cocaine that had a purity of 73.1% along with scales and other drug paraphernalia. Mr Moreno's possession of the cocaine was the basis for the possession charge included on a Form 1.
In the meantime, police had attempted to arrest Mr Moreno at the carpark with their guns drawn but he had accelerated his car in the direction of the police and escaped. One of the officers discharged his firearm. Mr Moreno drove his car through a closed boom gate. However, he was arrested around an hour later without further incident.
An examination of the contents of the sports bag revealed that 13 of the packets contained sugar and two of them contained wood. In his interview with the police, Mr Moreno said that he constructed the imitation cocaine blocks and placed them in the sports bag. He said he expected to receive $300,000 from the transaction. Mr Gomez admitted the packages were sugar and that he had purchased the sugar at a supermarket. The agreed facts record that Mr Riano told the police that Mr Moreno and Mr Gomez had been planning the supply for several months. Mr Riano said that Mr Moreno had planned the meeting, told him what to do and that he expected to receive 20% of the profits for assisting Mr Moreno and Mr Gomez.

Moreno - Agreed Facts

The agreed statement of facts tendered in Mr Moreno's case contained some additional facts so far as he was concerned. Only three differences are arguably material.
First, in relation to the meeting on 2 June 2020, the agreed facts concerning Mr Moreno record that during the meeting Mr Moreno acted as a translator and that following the meeting police observed Mr Moreno and Mr Gomez driving away in a vehicle registered in Mr Moreno's name. The additional entries note that Mr Gomez does not speak English and that "[p]art of Mr Moreno's role in the enterprise was to translate Spanish to English."
Second, in relation to the meeting on 7 July 2020, the agreed facts concerning Mr Moreno included additional information about Sam handing the encrypted phone to Mr Moreno and that "Mr Moreno told Sam he would give the telephone to Gomez."
Third, various parts of the agreed facts concerning Mr Moreno suggest that on 24 July 2020, he was not aware that there were police present. Hence, the agreed facts record that it was "plain clothed" police who had their guns drawn and that when he absconded, he did not know that the persons approaching him were police officers.

The Sentencing Judgment

At the time her Honour sentenced both applicants, her Honour also imposed sentence on Mr Riano. As there is no complaint of disparity between the sentences imposed on the applicants and Mr Riano, it is not necessary to consider his position further.
In the sentencing judgment, her Honour summarised the material aspects of the agreed facts and then addressed the objective seriousness of the drug supply and proceeds of crime offences. As her Honour's assessment of the former is the subject of complaint by both applicants on appeal, it is appropriate to set out the entirety of her Honour's reasoning on that topic: "I come now to an assessment of the objective gravity of the principal offence. Among the considerations relevant to that task is the weight of the drug and the role of each offender. The weight of the substance purporting to be cocaine was 15 kilograms, which is 15 times the threshold of the large commercial quantity for cocaine, which is one kilogram. However, the upper range is unlimited and there can be quantities in the hundreds, or even thousands, of kilograms. The fact that the substance was not cocaine and thus illicit drugs were never going to be actually disseminated into the community is a relevant factor on sentence. Nevertheless, as the authorities make clear, drug rip-off supply offences remain objectively serious. As to the part each offender played, based on the agreed facts and his own admissions in his affidavit at par 21, Mr Gomez was the principal. He formulated the plan and then involved Mr Moreno. The fact that he had such a large sum of money, namely $340,950 in cash in his possession, supports this finding. There was considerable planning by Mr Gomez and by Mr Moreno as evidenced in their dealings with the undercover operative on 2 June 2020 and their ongoing communications with him over the following month. They then met another undercover officer on 7 July 2020 and on that occasion supplied him with cocaine, which they represented as a sample of what they could supply in the future. In the weeks following that meeting they both communicated with undercover operatives using the encrypted phone which had been supplied by the officer on 7 July and prepared the block which they were purporting to be cocaine. As to Mr [William] Franco Riano, although the agreed facts outline that he knew about the plan from about December 2019, his involvement on this day was limited to about three and a half hours, that is from the time Mr Moreno contacted him [at] about 1.30 to the meeting with the undercover operative [at] about 5pm. Each offender was motivated by the prospect of considerable financial gain. Overall, taking all relevant circumstances into account, I find that the offence committed by Mr Gomez falls at the mid-range of objective gravity. I find Mr Moreno just below the mid-range and find Mr [William] Franco Riano at a reasonably low level of objective gravity for an offence under this section of the Drug Misuse and Trafficking Act. The offence is of such objective gravity that no penalty other than imprisonment is appropriate." (emphasis added)
The reference in the above passage to the admissions in Mr Gomez's affidavit is to part of an affidavit sworn by him and read at the sentence hearing in which he stated, "[t]he idea to pose as members of a drug cartel and supply sugar instead of cocaine to a buyer was my idea."
Her Honour assessed the objective seriousness of Mr Gomez's proceeds of crime offence as "fall[ing] at about mid-range". Her Honour found that the Form 1 offences for both Mr Gomez and Mr Moreno only "add[ed] little to the sentence to be imposed".
Her Honour then addressed Mr Gomez's subjective case. As at the time of sentencing, Mr Gomez was 51 years of age. He had no prior convictions in Australia or overseas. He had been married for 27 years and worked as an electrician for 30 years. He left Colombia with his family for Spain in 2000 but returned in 2013. By 2019, he had acquired debt. He came to Australia to visit his nephew, Mr Moreno, in 2019 with the intention of then travelling to Spain for work but remained. Under the conditions of his visa, he could not work. As noted, he conceived the plan to engage in fake drug sales. He occupies positions of trust in custody, although he is "fairly isolated" because he speaks limited English. Her Honour accepted his expressions of remorse. His Honour found that Mr Gomez was unlikely to reoffend and had good prospects of rehabilitation.
In relation to Mr Moreno, her Honour noted that he was 28 years old at the time of offending and 30 years old at the time of sentence. The only prior conviction on his record was an offence of driving with a prescribed concentration of alcohol in the low range in 2018. Her Honour held he was entitled to leniency "to reflect his almost unblemished record". Her Honour described Mr Moreno as having a "stable" family life in Colombia. He had worked in the construction industry with his father and commenced an Industrial Engineering Degree before coming to Australia in 2015 to continue his studies. Mr Moreno worked in Australia but began using drugs and, like his uncle, acquired debt. A psychologist's report noted that he met the criteria for alcohol use and stimulant use disorders. Her Honour accepted that the offence was "completely out of character" and that his remorse was genuine, he had "excellent" prospects for rehabilitation and was "extremely unlikely to re-offend".
With both Mr Gomez and Mr Moreno (as well as Mr Riano), her Honour afforded a discount of 25% on account of their pleas of guilty and made a finding of "special circumstances" as it was their first time in custody (Sentencing Act, s 44(2) and (2B)). Her Honour also referred to the effects of pandemic restrictions on prison conditions. This is the subject of ground 2 of Mr Moreno's appeal.

Ground 1 (Mr Gomez and Mr Moreno): Assessment of Objective Seriousness

Ground 1 of Mr Gomez's appeal contended that the sentencing judge erred in assessing the objective seriousness of the supply offence.
Ground 1 of Mr Moreno's appeal contended that: "(a) The sentencing judge erred by failing to have regard to material matters in the evaluation of the applicant's culpability including: (i) by failing to find, as a mandatory mitigating factor, that there was no substantial harm caused by the commission of the offence, and, (ii) that the scale of the illegal transaction was determined by the undercover operatives, and, (iii) that the weight of the substance was of no bearing upon the objective seriousness of the offence. (b) The sentencing judge erred in her conclusion as to the objective seriousness of the applicant's criminality."
Given that both grounds concern her Honour's assessment of the objective seriousness of each offender's supply offence, they can be dealt with together.

Approach to the Ground of Appeal

In considering the various submissions made in support of these grounds, two matters should be noted at the outset.
The first matter concerns the basis of challenging a finding concerning the objective seriousness of an offence. In Mulato v R [2006] NSWCCA 282 ("Mulato"), Spigelman CJ observed (at [37]): "Characterisation of the degree of objective seriousness of an offence is classically within the role of the sentencing judge in performing the task of finding facts and drawing inferences from those facts. This Court is very slow to determine such matters for itself or to set aside the judgment made by a first instance judge exercising a broadly based discretion. The question must be whether or not the particular characterisation which her Honour gave to the circumstances of the offence was open to her Honour." (emphasis added)
To similar effect, Simpson J, as her Honour then was, stated (at [46]): "The assessment of the objective seriousness of an offence is quintessentially for the sentencing judge. It is, if not a finding of fact, then the exercise of an evaluative process akin to fact finding or the exercise of a discretion. As such it is reviewable in this Court only on the principles stated in House v The King [1936] HCA 40; 55 CLR 499. The importance of respecting the role of a first instance judge should never be underestimated. It is not the function of this Court to substitute its own view of objective seriousness for that of the first instance judge. That is not because objective seriousness is something determined by reference to the evaluation of the credibility of witnesses, in respect of which it is conventionally held that the first instance judge is in a superior position. It is because it is a fundamental aspect of the appellate system. Each judicial officer in the hierarchy has his or her own function, and those at appellate level need to take care not to trespass upon the role of those at first instance." (emphasis added)
Mulato was published during the period when this Court's decision in R v Way (2004) 60 NSWLR 168; [2004] NSWCCA 131 ("Way") held currency (i.e. before it was overruled by Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39; "Muldrock"). The form of assessments of objective seriousness that were considered in Mulato were those that placed the relevant offence somewhere within or along the range of offending for offences of that type. This reflected an understanding that, at least for offences that carried a standard non-parole period, assessments of objective seriousness had to adopt such an approach. At present, there is no such requirement, even for offences that carry a standard non-parole period (Sentencing Act, s 54B(6)). If the basis of a challenge to a finding of objective seriousness is that the characterisation adopted by the sentencing judge was not "open", then the task of addressing such a challenge becomes that much harder if the finding of objective seriousness does not refer to its location on a range of offending for offences of that kind.
The judgment of Simpson J in Mulato postulates the application of the principles in House v The King (1936) 55 CLR 499; [1936] HCA 40 at 504-505 ("House") as the basis for a challenge to a finding of objective seriousness. To the extent that Spigelman CJ referred to a finding of objective seriousness not being "open" in Mulato, then that corresponds to the reference in House (at 505) to a result that is "unreasonable or plainly unjust". House also identifies error as "allow[ing] extraneous or irrelevant matters" to be taken into account or not "tak[ing] some material consideration" into account (at 505). With the latter category, error is not established by simply identifying some fact or circumstance that might have been considered. Instead, what must be demonstrated is a failure to take some fact or factor that the sentencing judge was bound to consider (Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40 at 39).
The second matter concerns the fact that both applicants were convicted of supplying a drug, specifically agreeing to supply a drug, which was only represented to be cocaine. By operation of the deeming provision in s 40(1) of the DMTA, the applicants' conduct in representing that the drug to be supplied was a prohibited drug had the effect of deeming it to be "the specified prohibited drug", namely cocaine.
In Khoury v R [2020] NSWCCA 190 at [34]−[57] ("Khoury"), Johnson J comprehensively reviewed a number of sentencing decisions of this Court which have addressed supplies of goods represented to be prohibited drugs, that is, so-called "drug rip off" cases. Based on that review, three propositions of present relevance can be discerned.
First, Johnson J concluded that there is a "clear line of authority" that "drug rip-off" supply offences are "regarded as objectively serious" (Khoury at [54]). Only one decision stood as an exception to that, namely R v Kalpaxis [2001] NSWCCA 119; (2001) 122 A Crim R 320 ("Kalpaxis"). However, Kalpaxis involved "nothing more than a ruse by a mentally disturbed offender... to obtain sufficient money to enable him to spend time in Greece with his family and with his father who was dying of cancer" (Aoun v R [2011] NSWCCA 284 at [46]). In R v Kijurina [2017] NSWCCA 117 (at [103]), Price J observed that: "When sentencing for drug 'rip‑offs' that purport to be genuine deals involving more than the large commercial quantity of a prohibited drug, it is of the utmost importance that courts impose sentences of sufficient severity to ensure, as far as possible, that others who may be tempted to engage in similar conduct are dissuaded from such criminal activity. It will only be in an exceptional case that a non-custodial sentence will be appropriate."
Second, "drug rip off" cases such as the present cannot be equated with fraud or false pretence cases (see, for example, R v Yaghi (2002) 133 A Crim R 490; [2002] NSWCCA 396 at [15] and [17]; "Yaghi"; R v Dendic (1987) 34 A Crim R 40 at 45 per Street CJ). As Johnson J stated in Khoury at [55]: "Whilst this aspect [i.e. the fraud on the purchaser] is to be taken into account in assessing the objective seriousness of the offence, this Court has consistently rejected an approach where the offence is to be characterised as being more one of dishonesty than a drug supply offence which is capable of attracting significant penalties under the DMT Act."
One of the submissions made on behalf of Mr Moreno in this Court sought to resurrect this heresy in contending that Mr Moreno had "essentially" been charged with fraud. That submission is inconsistent with Khoury and the cases discussed therein. The applicants were sentenced for the crime they committed, which was the supply of a prohibited drug. They were not sentenced for fraud or conspiracy to defraud the drug purchasers.
Third, at least part of the rationale for the prosecution and punishment in these cases was identified by Wood CJ at CL (with whom Smart AJ agreed) in Yaghi at [16]−[18] as follows: "It is regrettably a fact of life, within the organised drug trade, that 'rip offs' occur, and those who choose to cloak such an endeavour with the appearance of a genuine drug deal, must accept the consequences if their conduct happens to fall within the specific provisions of the Drug Misuse and Trafficking Act… Part of the reason for that lies in the circumstance that, unlike most cases of fraud or false pretences, the victim of a drug rip off is unlikely to report the matter to police. As a result, subject to any act of violent retribution, which commonly follows such an event, the offender is likely to escape scot-free. There is a significant community interest in not allowing the drug trade to be used as a vehicle for fraudulent activities of this kind, and also in deterring the kind of violent response which such conduct can very readily provoke."

Alleged Errors

In the passage from the sentencing judgment set out above at [24], her Honour referred to the weight of the drug that was agreed to be provided but also acknowledged that the substance was not cocaine and no "illicit drugs" were to be "disseminated". Her Honour added, "[n]everthess, as the authorities make clear, drug rip off supply offences remain objectively serious." With respect, this was an entirely orthodox application of the authorities noted above, especially Khoury.
The written submissions filed on behalf of Mr Moreno made a series of contentions to the effect that her Honour's reference to the weight of the drug to be supplied was erroneous. Thus, it was submitted that her Honour's treatment of the "magnitude of the substance" was "not identified as relevant to potential profit or related criteria but rather relative as to the threshold which attracts the maximum penalty of life imprisonment". It was submitted that "the 'weight' of the substance, and the extent to which it departed from the threshold [of a large commercial quantity of a prohibited drug, being 1kg] was not a material consideration" (i.e. irrelevant). This submission was fiercely adhered to in oral submissions and also embraced by counsel for Mr Gomez.
This submission is untenable. It rests on the false premise that the essence of the applicants' criminality is the perpetration of a fraud and thus it follows that the scope of their criminality is gauged by the amount they sought to defraud the purchasers or gain for themselves, not the quantity of the false drug they agreed to supply. It follows from Khoury, and the cases it refers to, that this proposition must be rejected. The applicants' criminality was their agreement to supply what they represented to be a prohibited drug, and a significant aspect of the scope of criminality was the amount of drug they agreed to supply (15kg of cocaine). The amount of cash the applicants intended to receive is an aspect of ascertaining the scope and degree of sophistication of their agreement to supply, and not vice versa. In this respect, the criminality of the offenders was not relevantly different to that of parties to a conspiracy to supply, with the amount of drugs the subject of any such conspiracy being undoubtedly relevant to determining the objective seriousness of such a crime.
The submissions made on behalf of Mr Moreno contended that "[t]he inference to be derived from the evolution of the arrangements was that the purchasers of the drugs were handing over the money without real concern as the risks of losing it", which was said to bear upon the applicants' moral culpability. It was also submitted that "none of the dangerous or potentially harmful consequences of an underworld rip-off existed in this case", presumably because the applicants were dealing with undercover police so there was no danger of reprisals or similar acts of violence occurring.
These contentions are simply a different expression of the proposition that the objective seriousness of the applicants' supply offence is less than what it would have been had they intended to supply real cocaine. The fact that, as it turned out, the proposed purchasers were undercover operatives does not affect the applicants' moral culpability and does not detract from the rationale for sentencing offenders in "drug rip off" cases noted in the passage from Yaghi at [43] above. Deterring offenders generally will serve the objective of "not allowing the drug trade to be used as a vehicle for fraudulent activities" and preventing the often "violent response[s]" that follow (Yaghi at [18]). As recorded in the agreed facts, Mr Gomez took a knife with him the sale in the carpark which is consistent with the potential for violence to occur in such situations. As a practical matter, many cases involving a drug rip off involve undercover operatives. A disappointed purchaser of fake drugs is unlikely to report the matter to the police station.
It was also contended that counsel for Mr Moreno submitted to the sentencing judge that Her Honour should have "regard to those matters which required mandatory consideration by the operation of s 21A(1) of the [Sentencing] Act" and, in particular, that "the injury, emotional harm, loss or damage caused by the offence was not substantial" (Sentencing Act, s 21A(3)(a)). It was submitted that her Honour erred in not making a finding to that effect (citing Chemaissem v R [2021] NSWCCA 66 at [63]).
In fact, counsel for Mr Moreno did not invite the sentencing judge to make a specific finding that the harm occasioned by the offence was not substantial nor was s 21A(3)(a) referred to. Instead, counsel addressed her Honour at length on the relevance to an assessment of objective seriousness of the fact that only sugar was in fact to be supplied. As noted above (at [44]), her Honour acted on that basis.
A related submission is reflected in ground 1(b) of Mr Moreno's appeal, namely, that "the scale of the illegal transaction was determined by the undercover operatives". It is not necessary to consider this in any detail as it is not supported by the agreed facts. The agreed facts simply refer to Mr Gomez and the undercover operatives discussing the transaction. They do not suggest that the undercover operatives determined its scale.
The written (and oral) submissions made on behalf of Mr Gomez made the same points. In particular, it was submitted that "[h]er Honour made no distinction in her assessment to what extent the criminality involved was less than that involved in a case where there was a genuine plan to supply drugs." In the extract from the sentencing judgment set out above at [24], her Honour noted, "[t]he fact that the substance was not cocaine and thus illicit drugs were never going to be actually disseminated into the community is a relevant factor". This is a clear statement that the sentencing judge did exactly what Mr Moreno's submissions said she did not.
At the hearing of the appeal, counsel for both offenders contended that the assessments of the objective seriousness of the offending was vitiated by her Honour's failure to consider that the source of money for the proposed drug purchase was not the proceeds of some crime (because they were funds made available to the police).
This submission was not made to the sentencing judge and, in any event, is simply another complaint about the weight attached to the fact that the supply offence was only a purported sale of prohibited drugs to undercover operatives. In Kada v The Queen [2017] VSCA 339; (2017) 270 A Crim R 197 at [72], it was noted that "it would be anomalous for the offender to receive a more favourable sentencing disposition due to a circumstance which, from his or her perspective, is fortuitous, namely the involvement of the police" (cited in Ibrahim v R [2022] NSWCCA 161; (2022) 371 FLR 30 at [60]).
Further, in oral submissions, counsel for Mr Moreno submitted that her Honour's description of Mr Gomez as a "principal" was erroneous because it suggests a "far more complicated role that involved far more people in the ordinary course and far more criminality". I do not accept this submission. Her Honour stated, "Mr Gomez was the principal. He formulated the plan and then involved Mr Moreno." The reference to Mr Gomez as a "principal" was a useful description that helped distinguish his role as the originator of the transaction from that of Mr Moreno (and Mr Riano) in assisting in carrying out a "single enterprise" (R v Olbrich (1999) 199 CLR 270; [1999] HCA 54 at [19]).

Conclusion

None of the complaints made on behalf of either offender contending that her Honour failed to consider some relevant factor, or supposedly considered some irrelevant factor, have any substance. In the end result, each applicant's (best) contention is that the sentencing judge's assessment of the objective seriousness of their offending was simply not "open" given that the applicants had no intention to sell prohibited drugs. If I was to determine the matter afresh, I would not conclude that Mr Gomez's offending was at the mid-range of objective seriousness or that Mr Moreno's offending was "just below the mid-range", even allowing for the uncertainty in those assessments. Nevertheless, given the size and scope of the transaction, the period of time over which it was negotiated and the elaborate steps the applicants took to give effect to it, I am not satisfied that it was not "open" (or that it was unreasonable) for her Honour to make such assessments.
I would reject ground 1 of each applicant's notice of appeal.

Ground 2 (Mr Moreno): COVID-19 Pandemic Conditions

Ground 2 of Moreno's appeal contends that the sentencing judge erred by failing to take into account the fact that the Covid-19 pandemic rendered the conditions of his imprisonment more onerous in ways beyond visitation restrictions. At the hearing of the appeal, Mr Gomez sought and was granted leave to rely on this ground.
The written submissions in support of this ground noted that, during submissions on sentence, her Honour noted that as a result of the pandemic there had been "increased lockdowns and [restrictions on] access to… courses and the like". It was contended that, despite this acknowledgement, her Honour limited her consideration of the effect of pandemic restrictions to family visits. It was submitted that this alleged error was analogous to the error found in SF v R [2022] NSWCCA 216, where the sentencing judge had indicated an intention to take into account the likely impact of the pandemic and pandemic restrictions on prison conditions but only addressed the delay in the applicant's sentencing (at [85] per Ierace J, with whom Simpson AJA and Hamill J agreed).
The relevant part of her Honour's reasons which address the effect of the pandemic on the applicants is as follows: "In coming to the appropriate sentence I have considered the current conditions for prisoners during the pandemic. The offenders have been in custody from 24 July 2020 at a time when personal visits were suspended. In November 2020 they were restored but from 24 June 2021 personal visits were again suspended in response to the growing cluster of Covid cases. The Corrective Services Website currently states that in-person visits will recommence as soon as it is safe to do so. When this will be is unknown, which is a further factor I have taken into account, in addition to the fact that each offender is isolated from family and friends in Colombia. However, this latter factor cannot be given great weight in circumstances where each committed such a serious offence when a visitor to this country." (emphasis added)
The entire premise of this ground is that her Honour's statement that the "current conditions for prisoners" had been considered was confined by the balance of the discussion so that it only referred to restrictions on family visits.
I do not accept that premise. In an exchange during submissions on sentence, counsel for Mr Moreno submitted that he was "subject to the consequences of the COVID-19 pandemic and… very severe restrictions… while in custody". Those restrictions were not identified nor the subject of evidence. Her Honour responded by stating that from "general knowledge - there are increased lockdowns and access to… courses and like". The matter was left at that. The above passage simply involves her Honour acknowledging the existence of "current conditions" at the time of sentence that were difficult for prisoners generally and identifying a particular example of such difficulty, being its effect on family visits. I am not satisfied that her Honour erred in the manner contended.
I would reject ground 2 of Mr Moreno's (and Mr Gomez's) notice of appeal.

Ground 3 (Mr Moreno): Manifest Excess

Ground 3 of Mr Moreno's notice of appeal contends that his sentence is manifestly excessive.
This ground is to be determined in accordance with what was said by Gleeson CJ and Hayne J in Dinsdale v The Queen (2000) 202 CLR 321; [2000] HCA 54 at [6] as follows: "Manifest inadequacy of sentence, like manifest excess, is a conclusion. A sentence is, or is not, unreasonable or plainly unjust; inadequacy or excess is, or is not, plainly apparent. It is a conclusion which does not depend upon attribution of identified specific error in the reasoning of the sentencing judge and which frequently does not admit of amplification except by stating the respect in which the sentence is inadequate or excessive. It may be inadequate or excessive because the wrong type of sentence has been imposed (for example, custodial rather than non-custodial) or because the sentence imposed is manifestly too long or too short. But to identify the type of error amounts to no more than a statement of the conclusion that has been reached. It is not a statement of reasons for arriving at the conclusion. A Court of Criminal Appeal is not obliged to employ any particular verbal formula so long as the substance of its conclusions and its reasons is made plain. The degree of elaboration that is appropriate or possible will vary from case to case."
It follows from the sentencing judge's findings that Mr Moreno had a strong subjective case. He was inveigled into the drug transaction by his uncle. However, given the size and scope of the proposed transaction as reflected in the unimpeached finding of objective seriousness as well as the maximum sentence and standard non-parole period for the supply offence (see above at [4]), I do not consider that the sentence was manifestly excessive.
I would reject ground 3 of Mr Moreno's notice of appeal.
I propose the following orders: In the appeal by Mr Moreno: (1) Leave to appeal be granted; (2) The appeal be dismissed; In the appeal by Mr Gomez: (1) Leave to appeal be granted; (2) The appeal be dismissed.
PRICE J: I agree with Beech-Jones CJ at CL.

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: 21 June 2023

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (14 paragraphs)

Legislation Cited (4)

Cases Cited (23)