The Issue of Delay
28A chronology of the investigation and prosecution of the offences was before the sentencing judge. Despite referral of the irregularities to ASIC on 17 April 2008, the investigation was not commenced until 22 August 2008. The matter was referred to the Commonwealth Director of Public Prosecutions in May 2009. Between January 2010 and the end of March 2011, there were a number of exchanges between the DPP and ASIC pursuant to requisitions which were raised by the DPP.
29On 14 April 2011 the respondent left Australia to take up residence in Indonesia with his wife and family.
30The appropriate charges were settled by the DPP in late May 2011 and Court Attendance Notices (CANs) were sent to ASIC for service upon the respondent. It appears that the respondent became aware of the probability of charges in May/June 2011 through a conversation with his father-in-law. In June of 2011, the DPP considered extradition proceedings against the respondent. However, ultimately that course was not pursued. On 1 September 2011 ASIC provided the DPP with a letter from the respondent's counsel, authorising ASIC to serve documents on his clerk. That counsel was later appointed to the Local Court bench, necessitating a change in legal representation.
31The first return date of 13 September 2011 in the Local Court was adjourned because of problems associated with service of the CANs. Between September and December 2011 there were various adjournments sought on behalf of the respondent. In December 2011 the respondent returned to Australia.
32The respondent first appeared in the Local Court on 10 January 2012. Between January and July 2012 several adjournment applications were made by the respondent on the basis that he was pursuing a grant of legal aid, which was initially refused. In July 2012 legal aid was granted.
33On 28 August 2012 the respondent entered a guilty plea to the rolled up count in the Local Court. That was the product of plea negotiations between the DPP and the respondent's legal representatives.
34On 7 September 2012 the matter was listed for sentence in the District Court on 22 November 2012. However, on that date the matter was stood over to the 15 February 2013 on the basis that the respondent required more time to prepare his case. On 2 February the matter was stood over for sentence to 5 April 2013 by consent on the basis that the Crown wished to obtain a psychiatric report in response to the psychiatric report prepared on behalf of the respondent. The sentencing proceedings took place on 5 April 2013.
35In short, there was a period of three years and one month between the breach report and the laying of charges. Thereafter, the lapse of time was principally attributable to the respondent's absence from Australia, the consequent difficulties associated with service of the CANs, delays in the grant of legal aid, a change in the respondent's legal representation, plea negotiations and the preparation of the respondent's case on sentence.
36Despite a submission from the Crown that the length of the investigation was referable "in large measure" to the complexities involved in investigating this type of offence, involving as it did tracing a number of transactions through multiple accounts over a lengthy period of time, her Honour made the following finding on sentence :-
I am not persuaded that the complexity of the offending transactions justify a three-year consideration by ASIC and the DPP before a decision was made to charge Mr Donald. The transactions are essentially 30 variations of the same conduct, involving three accounts in 29 transactions and a fourth in the 30th. ASIC is a specialist corporate investigative body and the Commonwealth DPP has experience and expertise in prosecuting corporate offences. Therefore the three-year period from referral to ASIC until the approval of charges involved substantial and largely inexplicable delay.
[Her Honour accepted that the respondent could not be criticised for his decision to go overseas, the initial refusal of legal aid and the change in legal representation.]
.............................................................................
There was a three-year delay by the Crown between the detection of the offence and Mr Donald being charged. It is now just over five years since the last transaction constituting the offence and the detection of the offence. In that period Mr Donald has demonstrated a commitment to his rehabilitation by attending treatment for his illness and ceasing abusing drugs and alcohol. The delay and Mr Donald's substantial rehabilitation during the time since the offence warrants some amelioration of his sentence.
37The Crown does not now dispute that the delay was relevant in so far as it allowed the respondent to achieve a measure of rehabilitation and treatment during that period. Nonetheless, the Crown contends that the delay did not of itself justify any extension of leniency : R v Wall (2002) 71 NSWLR 692 at [89] : R v Kearns [2003] NSWCCA 367 at [68] - [69] ; R v Scook v R (2008) 185 A Crim R 164 at [31] - [34], [58] - [65].
38The Crown further submits that her Honour was obliged to have regard to "the well recognised difficulties and complexities involved in investigating and prosecuting white-collar crimes, particularly when there has been conduct designed to make detection of the offence more difficult, as was the case here". The Crown submits that it was somewhat inconsistent for the judge to recognise the Crown's concession that "the trial would have been lengthy and complex" whilst at the same time refusing to acknowledge the complexity of the investigation. The Crown maintains that the three years between the breach report and the laying of charges, although a substantial period of time, "was not disproportionate to the complexity of the matters being investigated". The respondent suffered no detriment; to the contrary he was at liberty to travel overseas. The Crown submits that in all the circumstances, the delay "did not warrant any significant reduction or amelioration of the penalty".
39By way of response, the respondent draws attention to the fact that there were no specific factual matters relied upon in support of the submission that the delay was not disproportionate to the complexity of the investigation. The respondent observes that the Crown does not submit that the judge's finding in relation to the substantial and inexplicable delay was not open to her Honour. Nor did the Crown submit that it was not appropriate for the judge to have regard to the overall delay of five years between the detection of the offence and the sentencing proceedings, given that the respondent's subjective circumstances had changed significantly over that time.
40The respondent relies upon R v Schwabegger [1998] 4 VR 649, R v Fahda [1999] NSWCCA 267, Khoury v R [2011] NSWCCA 118 and Blanco v R (1999) 106 A Crim R 303.
41In Wall, the delay between the commission of the offence and sentence was in the order of six years but was primarily attributable to the late detection of the offence and the offender's plea of not guilty. The comment by Wood CJ at CL at [89] (Meagher JA and Bell J agreeing) that :-
delay in the prosecution of white-collar crimes is not unusual and the fact that they are so difficult to discover and successfully prosecute is one of the reasons why general deterrence is so important
ought be understood in that context. Where the bulk of the delay occurs between the detection of the offences and charging, these remarks are perhaps less apposite.
42In Kearns, the offender was convicted after trial of nine offences charged under the Corporations Law 1991 (Cth) and the Crimes Act 1900 (NSW). The offender was a participant in a joint venture in a New Zealand financial services group known as the Equitable Group of Companies, of which the parent was Equitable Investments Limited. The offender committed the relevant offences with the intention of taking control of the Equitable Group. The offences consisted of a complex series of share transactions and deceptive conduct on the part of the offender. One can readily understand why the Chief Justice determined at [68] (Dunford and Hidden JJ agreeing) that :-
the period of some three and a half years for the process of investigation and determination of which charges could be pursued does not, in the circumstances, appear to me to be so excessive as to constitute a factor that requires to be taken into account in the exercise of the sentencing discretion. (italics not in original)
43The West Australian decision of Scook also falls into the category of a complex and lengthy course of offending conduct, coupled with significant delay occasioned by various interlocutory applications by a co-offender. The offender in Scook :-
was the instigator of a scheme and coordinated the buying and selling of millions of shares in Intrepid on the ASX in the period 2 January to 27 February 1998. The charges related to trades on almost every trading day in that period and involved total shares in excess of 11 million. The appellant coordinated the trading by giving buy or sell instructions to different brokers on 13 share trading accounts he was authorised to trade on and by causing a group of six traders to place buy and sell orders with their brokers on their accounts at his direction. (at [6])
44McClure JA helpfully reviewed the authorities relating to the significance of delay and concluded :-
[31] The authorities support the following propositions. Delay itself (mere delay) is not mitigatory. Delay in combination with other relevant sentencing factors favourable to the offender, such as progress towards rehabilitation, is mitigatory. In those circumstances, delay is facilitative or causative but not itself mitigatory. As a consequence, the reason for the delay is not ordinarily relevant. It may be so if the delay was attributable to the offender (see Shore (1992) 66 A Crim R 37).
[32] It is not possible to identify all factors which in combination with delay will be mitigatory. It will depend on the circumstances. For example, in Schwabegger and Duncan, the delay contributed to a legitimate expectation that there would be no prosecution on which the offenders acted.
[33] It is the case that in the period prior to conviction and sentence, an accused is left in a 'state of uncertain suspense' which for many offenders (certainly those with prior good character) would be significantly stressful. However, that is a consequence of involvement in the criminal justice system and is not ordinarily mitigatory. An accused is entitled to avail himself or herself of all the rights and protection offered by the criminal law with the inevitable consequence of delay before conviction and sentence, but such delay is not mitigatory (unless it facilitates or results in other positive sentencing considerations). However, undue or unreasonable delay not attributable to the conduct of the accused may itself be mitigatory because it unreasonably extends the period of suspense.
[34] I would not draw an inference that the delay between the commission of the offences (or from the time of the ASX referral to ASIC) and the appellant being charged in December 2002 is unreasonable having regard to the nature and extent of the appellant's offending (which involved the use of a number of innocent agents and active concealment of his role), its factual complexity and the need to obtain evidence on each count. The delay between the appellant being charged and sentence is attributable in large measure to Mr Braysich's interlocutory applications. In my view, the proper use of interlocutory applications by a co-offender properly joined does not render the consequential delay unreasonable.
45Buss JA, in the same case, agreed with these comments and made some additional observations, including that :-
[59] Secondly, delay will not ordinarily be a mitigating factor if it has been caused by difficulties in detecting, investigating or proving the offences committed by the offender, and the period of the delay is reasonable in the circumstances.
[60] Thirdly, delay will not ordinarily be a mitigating factor if it is caused by the offender's obstruction or lack of co-operation with the State, prosecuting authorities or investigatory bodies, but the offender's reliance on his or her legal rights is not obstruction or lack of co-operation for this purpose.
[61] Fourthly, delay will not ordinarily be a mitigating factor if it results from the normal operation of the criminal justice system, including delay as a result of the offender or a co-offender exercising his or her rights; for example, interlocutory appeals and other interlocutory processes.
[62] Fifthly, delay may be conducive to the emergence of mitigating factors; for example, if, during the period of delay, the offender has made progress towards rehabilitation or other circumstances favourable to him or her have emerged.
[63] Sixthly, delay (not being delay of the kind described in the second, third and fourth guiding principles) will ordinarily be a mitigating factor if:
(a) the delay has resulted in significant stress for the offender or left him or her, to a significant degree, in 'uncertain suspense'; or
(b) during the period of delay the offender has adopted a reasonable expectation that he or she would not be charged, or a pending prosecution would not proceed, and the offender has ordered his or her affairs on the faith of that expectation.
[64] Seventhly, delay caused by dilatory or neglectful conduct by the State, prosecuting authorities or investigatory bodies may result in a discount of the sentence that would otherwise be imposed on the offender, if the court thinks it an appropriate means of marking its disapproval of the conduct in question.
46Miller JA in Scook agreed with both McClure JA and Buss JA.
47McClure JA's reference to R v Schwabegger requires some explanation, given the respondent's reliance upon it. The offender was charged with taxation fraud, relating to five income tax returns, six years after the offences were detected and in the meantime, had made full reparation to the Commissioner of Taxation pursuant to an agreement.
48For completeness, although these remarks were made in the context of an offence of aggravated car jacking, Howie J observed (Basten JA and Hall J agreeing) in R v Barker ; R v Gibson [2006] NSWCCA 20 :-
78 The delay in the prosecution of the respondents was not of the quality that could lead to any significant reduction in the ultimate sentence to be imposed. This case was very different from Todd or other cases where significant regard has been given to the effect of delay. This could not be regarded as a stale offence after a period of only two years delay and having regard to its seriousness. In any event, the impact of delay will play a significant role in the determination of the appropriate sentence in those cases where the delay is due to the operation of the judicial system and not to the actions of the offender: R v Kay [2004] NSWCCA 130 at [28]. It has little application where, as here, the respondents either chose to say nothing at arrest or, as in the case of the respondent Barker, denied the offence and gave the police a false account of his movements: R v Hathaway [2005] NSWCCA 368 at [44].
79 One of the reasons why delay mitigates the offence is because of the uncertainty left in the mind of the offender. The only uncertainty suffered by the respondents was whether the police would be able to make a case against them. That is not relevant uncertainty for the application of the principle: R v Shorten [2005] NSWCCA 106 at [19]. .................................. In the present case the respondents chose to plead not guilty, as was their right, until after the trial date was fixed. But they can hardly complain of the delay up to committal and from committal to trial when they could have pleaded guilty at any time: R v Bragias (1997) 92 A Crim R 330. Nor was the delay before charging shown to be unreasonably lengthy.
80 This does not mean that the delay was totally irrelevant. Her Honour was required to take into account the rehabilitation, if any, that had occurred during the delay. Generally where rehabilitation is shown during the delay, mitigation arises because of the rehabilitation achieved rather than because there was delay: R v Carter [1999] NSWCCA 376 at [25].
49There is nothing in this Court's consideration of the issue of delay in Fahda, Khoury, Blanco, Barker & Gibson, TJ v R [2009] NSWCCA 99, Tourni v R [2010] NSWCCA 317 or Giourtalis v R [2013] NSWCCA 216 that departs from the summary set out above in Scook, with the exception of the last factor (a mitigated penalty as a mark of disapproval of tardy prosecutorial conduct) in Buss JA's judgment. I am not aware of any authority in this State that has endorsed such an approach to the sentencing of an offender, where the absence of a satisfactory explanation for the delay leads to the conclusion that the prosecution has been "dilatory or neglectful". Overwhelmingly, the focus is on the consequences of the delay to the offender, no matter what the explanation for it.
50There is some force in the Crown's submission that the judge placed particular emphasis on the fact of delay, independently of the significance that attached to the delay by reason of the respondent's steps towards rehabilitation. That conclusion arises from the judge's reference to "the delay and [the respondent's] substantial rehabilitation".
51However, there is also some tension between the Crown's submission at [38] above and its failure to directly challenge the judge's finding of "largely inexplicable delay". It is not altogether clear in what way the investigation was complex. The Crown's investigative and prosecuting agencies were not confronted with complex arrangements made by the respondent in order to disguise the fraudulent nature of his activities. He disguised his offending with respect to the French Consulting account by falsely claiming that trades were made by Mr French himself. The Logetost and GT Henderson accounts were operated by the respondent in the name of his father-in-law. Neither of these subterfuges was particularly sophisticated. His offending was, apparently, readily detected by his employer, although it persisted for two and a half years before his employer's suspicions were enlivened. The three accounts operated by the respondent and the 30 transactions are a far cry from the magnitude of the trading in Scook.
52There was a delay of four months between referral of the matters to ASIC and the commencement of the investigation. There was a further nine months between the commencement of the investigation and the referral of the matters to the DPP. There followed two years of requisitions on the part of the DPP before the charges were framed. It is not suggested that the respondent did anything, beyond an insistence on his legal rights to representation and defence of the charges, that contributed unreasonably to the lapse of time between the settlement of the charges and sentencing. It is true that he was free to travel overseas, although the DPP appears to have been content to allow that to occur. All in all, the proceedings from the outset were conducted at a leisurely pace.
53In these circumstances, the remarks of Vincent AJA in Schwabegger are pertinent :-
There is a serious incongruity between the assertion that an offence is serious and that the courts must, through the sentences they impose, endeavour to limit its incidence, on the one hand, and such a leisurely progression of the criminal justice proceedings which follow its commission that literally years pass before the matter comes before the court, on the other. For a number of reasons, the investigation and prosecution of criminal conduct should be conducted as quickly as is reasonably practicable if the objectives of the system are to be attained. Additionally, a legitimate sense of unfairness can develop when the criminal justice process proceeds in what can be perceived as too leisurely a fashion.
54That is not to say that anything other than the consequences of delay is the operative concern in the sentencing exercise. It simply acknowledges that where, as here, general deterrence plays a significant role in the sentencing of an offender, that sentencing principle is undermined, not just by an inadequate sentence but also by a failure on the part of the prosecution to progress the matter expeditiously.
55I am not persuaded that, in the circumstances of this case, there was any error in failing to advert to the difficulties and complexities involved in investigating and prosecuting "white collar crimes". Difficulties and complexities may arise as a general proposition, but every case must be considered on its own facts. That is essentially what her Honour did.
56It was not suggested by the respondent that there was any legitimate expectation on his part that he would not be charged. It is reasonable to conclude that he was, however, in a state of suspense as to his ultimate fate from the time that his offending was detected. For the reasons that I have given, it was open to the judge to mitigate the penalty to some extent on the basis that the delay between the breach report to ASIC and the settlement of the charges was unreasonable in the circumstances, and that the respondent's state of suspense was therefore unreasonably extended.
57The Crown's submission, that the delay in all the circumstances did not warrant a significant amelioration of the penalty (represented by the suspension of an otherwise appropriate sentence), cannot be answered without a consideration of the respondent's mental illness, its contribution or otherwise to the commission of the offence, and the treatment that the respondent has undergone for that mental illness since its diagnosis and the detection of the offending. The real significance of the delay in this case resides in the respondent's progress towards rehabilitation, which was connected to some degree with his acceptance of his mental illness and its treatment.