R v Arundell [2005] VSCA 19

Court of Appeal (Vic)|2005-02-10|Before: WINNEKE, P., CHARLES and BUCHANAN, JJ.A.

Criminal law - Sentence - Obtaining property by deception - Theft - Appellant previously sentenced for similar offences of overlapping nature - Cumulation - New non-parole period fixed - Whether unreasonably high by reference to first non-parole period - Manifest excess - Appeal dismissed.

Charles, J.A. will give the first judgment in this appeal.

During the period 1997 to 2001, the appellant practised as a chartered accountant, a registered tax agent and a financial adviser. One of his clients was a group of companies which carried on business in various forms under the name "Albedor", and which was a family kitchen cabinet manufacturing business of the Keurntjes family. The appellant began to act professionally for the Albedor companies in 1989 as a partner of a firm, but when that partnership was dissolved in 1993, Albedor retained the appellant on his own behalf. The appellant provided Albedor with a range of accountancy services. Included in these activities was the preparation of tax returns for Albedor, which officers of the Albedor companies would sign and return to the appellant together with a cheque for the tax he had calculated. On a variety of occasions, the appellant thus received cheques from Albedor for tax and other purposes, but the appellant misappropriated these cheques and used the funds provided to meet his own tax liabilities and for a variety of other improper purposes including servicing various of his debts. The total financial advantage obtained by the appellant through the commission of the Albedor offences was $1,087,334.24.

On 6 May 2002 the appellant pleaded guilty before the County Court in Melbourne to a presentment alleging thirteen counts of obtaining property by deception, and further charges of theft and defrauding the Commonwealth. During an extensive plea evidence was called on his behalf from Dr Lester Walton, a consultant psychiatrist, Ms Robyn Maree Miller, a social welfare and family therapist, the appellant's former wife, Jane Ursula Morcom-Arundell, Jeremy Brown-Greaves, a chartered accountant and the appellant's brother, Timothy Arundell. During the plea the judge was told that the appellant had no other problems or breaches of the criminal law revealed by the investigation of his accountancy practice. The judge sentenced the appellant to terms of imprisonment on each of the various counts leading to a total effective sentence of seven years' imprisonment and fixed a non-parole period of five years.

An appeal was brought from this sentence and this Court[1] on 4 June 2003 allowed the appeal and reduced the sentence imposed to a total effective sentence of six years, fixing a non-parole period of four years. This decision was reached not because the sentence was regarded in any respect as manifestly excessive, but on a question of law, that the exercise of his Honour's sentencing discretion had miscarried in that the judge had increased the penalties imposed on certain counts, the sole basis of the distinction between the penalties imposed having been whether the amount involved fell on one side or the other of the figure of $50,000.[2] Accordingly the Court considered proper regard had not been had to the circumstances of the particular count in question before deciding to increase the amount of the penalty.

After the sentence had been imposed by the County Court judge, various other matters came to the attention of investigating police. Further charges were laid and on 28 November 2003 the appellant pleaded guilty before the same County Court judge to thirteen counts of obtaining property by deception, one count of theft and one count of contravention of a restraining order under s.29 of the Confiscations Act 1997. An application was made to the judge to disqualify himself from hearing the plea on the grounds of an apprehension of bias due to his Honour having already sentenced the appellant, but the application was refused with reasons. That ruling is not challenged in this appeal. After a plea in mitigation, the judge sentenced the appellant on counts 1 to 13 in each case to 36 months' imprisonment, on count 14 (theft) to 24 months' imprisonment and on count 15 (contravening a restraining order) to 24 months' imprisonment. The judge made orders for cumulation of six months of the sentence imposed on each of counts 5, 6, 10 and 13 upon the sentence imposed on count 2, leading to a total effective sentence of five years and six months' imprisonment. His Honour fixed a non-parole period of four years. The judge directed that the appellant was sentenced as a continuing enterprise offender in respect of counts 2, 5 and 13 pursuant to s.6J of the Sentencing Act 1991. Pursuant to s.14 of that Act the judge fixed a new non-parole period in respect of all sentences of four years.

The appellant now seeks to appeal on the ground first that the sentence imposed is manifestly excessive having regard to the principle of totality, secondly that the judge erred in not mitigating the sentence imposed by reason of the appellant's co-operation with the authorities, thirdly that the judge erred in failing to discriminate in fixing sentences for the individual counts, and fourthly that the judge erred in fixing the non-parole period. Leave to appeal under s.582 of the Crimes Act 1958 was granted on 13 August 2004.

The circumstances giving rise to the appellant's offences are related to and overlap with those for which the appellant was sentenced on 14 May 2002. The appellant had established a company, RPB Properties Pty Ltd, and had encouraged some of his clients to invest in RPB. He advised clients that funds in RPB would enable RPB to acquire shares in property syndicates involving the purchase and development of land located at Roxburgh Park in Victoria and at Buderim on the Sunshine Coast in Queensland. A company, Nellridge Pty Ltd, was the developer of the Roxburgh Park property. Another company, Badjim Pty Ltd, was the developer of the land at Buderim. The appellant's offences followed a common pattern. It is sufficient to instance three of them. On 2 March 2001 the appellant's brother, Timothy Arundell, gave him a cheque payable to "David Arundell & Co. Trust Account" for $20,000 for investment in RPB. The appellant gave his brother a loan agreement signed in his own name containing the terms and conditions of a loan by Timothy Arundell to RPB of $20,000. He issued twenty shares in RPB to Timothy Arundell. On 2 March 2001 the appellant paid his brother's cheque into his firm's trust account. Thereafter on various occasions he drew cheques on this trust account, not for the purchase of shares in RPB, but rather for his own purposes, including making payment to one of the Albedor companies from which he had previously misappropriated funds (count 1). On 23 March 2001 William West handed a cheque to the appellant for $50,000 payable to the appellant's trust account for investment in RPB. The cheque was deposited by the appellant into the trust account. Two cheques were then drawn by the appellant, the first payable to Nellridge for $10,000 and the second payable to D.A. Arundell for $40,000. The second cheque was paid by the appellant into his Membership Australia Credit Union Account and shortly afterwards the appellant drew a cheque on this account in favour of Albedor for $40,000 (count 2). Count 6 related to a cheque that Michael Free on 16 May 2001 gave the appellant, payable to RPB for $50,000. The appellant endorsed the reverse of the cheque to make it payable to his firm's trust account, and the cheque was deposited into that account. Then on 17 May 2001 the appellant obtained a cheque in favour of Albedor for $60,000 using these funds of Mr Free.

The total financial advantage obtained by the appellant through the commission of these offences was approximately $375,500.

It is convenient to take first the ground which claims that the judge erred in failing to discriminate in fixing sentences for the individual counts. The judge did indeed impose a sentence of three years' imprisonment in the case of each of counts 1 to 13, each of which involved obtaining property by deception, in amounts which varied between $50,000 and $3,000. Mr Boyce for the appellant conceded that in the appellant's first appeal to this Court, the Court saw no reason to discriminate in length between the individual sentences imposed for the Albedor deception offences, notwithstanding that the amounts involved in the various counts varied between sums in excess of $200,000 and sums marginally exceeding $20,000. The Court however considered[3] (as I have said) that there was no adequate justification for differentiation between the penalties imposed for identical offences on the basis of the variations of the amounts involved. So also, in this case, the judge was, in my view, entitled to impose the same sentences on each count. As Mr McArdle for the Crown contended in this Court, the modus operandi in each case was the same or similar and each involved a serious abuse of a client's trust.

Insofar as any complaint is made in relation to the orders for cumulation, each of these is, I think, to be explained by reference to the amounts obtained by deception. Orders for cumulation were made in respect of counts 5, 6, 10, 11 and 13. Counts 5, 6 and 13 each involved the sum of $50,000 obtained by deception from Timothy Arundell, Michael Free and Michael Hammett. Counts 10 and 11 involved amounts obtained by deception from James Pszczolkowski, from whom a total of $80,000 (count 12 also related to this victim) had been obtained. I see no error in the orders for cumulation.

I turn then to the question of the non-parole period, to which most of the appellant's argument was directed. Mr Boyce contended under this ground that the present offences largely arose out of the Albedor offences and substantially overlapped in time with or were committed within a few months of these offences. A large portion of the financial advantage obtained through the commission of the present offences was used to repay Albedor. Mr Boyce put it that the appellant had been sentenced first on 14 May 2002 and, after his appeal to this Court had been allowed, the sentence imposed from that date was a total effective sentence of six years, with a minimum period fixed of four years. The appellant was then sentenced for the present offences on 9 December 2003. The total effective sentence then imposed was five years and six months, and a new non-parole period, ordered to commence on 9 December 2003, was fixed at four years. He argued that the result was that the total effective sentence imposed for all of what was in substance a continuous period of offending became seven years' imprisonment with a new non-parole period of five-and-a-half years. He argued that nothing had occurred since the appellant was first sentenced in the County Court which warranted the imposition of a proportionately higher non-parole period. The appellant had been in custody ever since he was first sentenced. On both occasions at the plea counsel had relied heavily, as had the judge, upon character evidence called at the plea for the Albedor offences. Furthermore since the appellant was first sentenced, he had given prosecuting authorities considerable assistance in the prosecution of a solicitor named Lustig, giving information to the authorities and making a statement. He had indicated his willingness to give evidence but had said that he did not want this fact recorded in the sentencing reasons in the form of an undertaking under s.5(2AB) of the Sentencing Act 1991.

It was further argued that the judge did not give any reasons as to why he imposed a new global non-parole period that was proportionally higher than the period earlier set by the Court of Appeal. Mr Boyce put it that the judge may not have had regard to the principle that when imposing a new global non-parole period pursuant to s.14 of the Sentencing Act account should have been taken of any relevant prior period of detention that could not formally be made the subject of a s.18 declaration of period spent in detention.[4] Assuming that there needed to be a modest increase in the new global non-parole period, conceding the existence of additional offending, it was argued that this period ought not to have exceeded 66 per cent or thereabouts of the total effective head term. Accordingly it was submitted that the appellant's overall non-parole period was unreasonably high.

In response, Mr McArdle argued that there had been no discussion in his Honour's sentencing reasons as to how the court arrived at the length of the new non-parole period. He submitted that the non-parole period as a percentage of the total effective sentence ordered by the Court of Appeal in June 2003 could not be regarded as in any way binding on the judge when he came to sentence the appellant on the second occasion. It was, he submitted, simply an exercise of discretion by the court and was within range.

I have already noted that the sentence first imposed by the judge on 14 May 2002, a total effective sentence of seven years, with a non-parole period of five years, was not criticised by this Court as manifestly excessive. Having regard to the extent of the criminality exposed by the appellant's offences, a head sentence of seven years, with a minimum of five-and-a-half years, could also not, in my view, be regarded as excessive. Furthermore the judge made express reference to the appellant's co-operation with prosecuting authorities in relation to the solicitor named Lustig and said he would take this into account.

The explanation for the increase in the non-parole period is, I think, to be found in the submission made to the judge on 6 May 2002 before he first sentenced the appellant. His then counsel, Mr Dunn, submitted -

"Your Honour, he has, I am instructed, had no other problems before or after, and as you could imagine, those responsible for looking after the affairs, accountants and people who run tax agents' practices, would have been through this practice with a fine tooth comb, and there is not only no breach of the criminal law prior to this matter, but there has been no repetition of the offence afterwards, and there has been no other matter revealed by the investigation."

The judge said, after quoting this submission, in his reasons for sentencing on 9 December 2003[5] -

"Mr Dunn is a most experienced criminal advocate. When this passage from Mr Dunn's plea was put to Mr McKenzie [the appellant's counsel at the second plea on 28 November and 2 December 2003], I indicated that it was reasonable to infer that Mr Dunn made this submission on instructions. Mr McKenzie did not suggest otherwise. Later, and I was informed, on your instructions, Mr McKenzie apologised for the court having been misled in this manner."

The judge was clearly and justifiably annoyed at having been deceived by the appellant as to the extent of his criminal behaviour in this way. Although the judge nevertheless considered that the appellant was capable of reform and rehabilitation, I have little doubt that the fact that his Honour had been misled led to the fixing of an increased non-parole period. In my view his Honour was perfectly entitled to take this course.

In my opinion none of the appellant's grounds of appeal has been made good, and I would dismiss the appeal.

The formal order of the Court is that the appeal is dismissed.

[1] Phillips, C.J., Vincent, J.A. and Cummins, A.J.A., reported as [2003] VSCA 69.

[2] [2003] VSCA at [28], per Vincent, J.A.

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