By way of explanation to the customs officers the applicant stated that he had been under financial pressure at the time of lodging the claims and that he needed the money in order to maintain cash flow. He stated further that he always intended to repay the rebates, after making a confession to the authorities.

The applicant was charged on summons with 13 counts of imposing on the revenue by an untrue representation with a view to obtaining money contrary to s.29B of the Crimes Act 1914 and one count of endeavouring to do so. That was on 2 February 1996, almost exactly 12 months after the applicant had made his confession.

He was brought before the Magistrates' Court in March 1996, but it was not until 27 September of that year that a single indictment came before the County Court at Kerang. The case could not be heard and went over to March 1997 at Bendigo where the applicant pleaded guilty to the one count which was then, by consent one gathers, brought against him. The matter was adjourned and the applicant was remanded to appear for plea and sentence at the Kerang County Court on a date to be fixed. It was not until 7 April this year that a plea in mitigation was heard whereupon the applicant was remanded and sentenced on 9 April. The sentence imposed upon him was that he be imprisoned for a term of two years commencing on 9 April and it was ordered that he be released after he had served six months of that term upon giving recognisance in the sum of $2,000, with a condition that he be of good behaviour for the remainder of the period of two years. He was also ordered to make reparation to the Commonwealth in the sum of $70,236. The amount which the applicant had dishonestly obtained from the Commonwealth was greater than that, but in the meantime he had, in a sense, repaid part of it. He had come to an arrangement with the authorities that in respect of diesel fuel which thereafter he bought, and to which he was properly entitled to a rebate, he would not claim it, but would allow the amount which he was entitled to claim to go in reduction of the amount which he had illegally obtained.

There was initially an application for leave to appeal on one ground only, namely, that the sentence was manifestly excessive. By order, however, of the Registrar of Criminal Appeals made as recently as the 13th of this month, three further grounds were added, namely, that the judge erred in rejecting evidence of delay as a relevant mitigating consideration; that the judge erred in rejecting the element of mercy as relevant to the exercise of the sentencing discretion, and, finally, that the judge erred in finding, as it was said in the ground, that the applicant's brother could run the horticultural property for the period that the applicant was incarcerated and that in the circumstances his incarceration would not produce exceptional hardship to his family.

The applicant's parents migrated to this country in the 1950s from Calabria and went to live in the Mallee where, by dent of hard work, ultimately they purchased 100 acres at Wood Wood and cleared it of Mallee roots and the like by their own physical labour, thereby establishing the stone fruit and vegetable growing business which they pursued for the ensuing 30 odd years.

The applicant, with his twin sister, is the eldest of a large family and he, having left school just before he turned 14, has worked the property ever since. He was at the time of plea aged 42. The property apparently did reasonably well until the early 90s when a series of unfortunate natural disasters set it back. It is unnecessary to dwell upon the catastrophes, but in substance, it was said, the produce of the property was virtually wiped out over four seasons from about 1990 onwards because of frosts and other natural events. So it was that the applicant's parents and the applicant, himself, his wife and children living on the property got into financial difficulties with their mortgagee, the Commonwealth Bank. The family was virtually evicted from the property in December 1996. I say "virtually" because by an arrangement there was a refinancing and the applicant was allowed back with a view to his working the property and ultimately obtaining an interest in it once again. At that time both the applicant's father and mother, each of whom was aged 69 and infirm, were not able to devote much time or effort to the running of the property. In November 1993 the applicant was made bankrupt, from which state he was not discharged until 14 January 1997.

These matters, to state them briefly and crudely, were the circumstances relied upon by the applicant to explain how he came to engage in a dishonest course of conduct towards the Commonwealth. On his plea it was urged that there were a number of mitigating circumstances to be taken into account. First, it was said that having reached the age of 42 he had suffered no prior convictions. He was said to be of good character in the community and witnesses were called to testify to that effect. He was soundly married with three children and a good, solid citizen, so it was said. He had cooperated with the customs authorities as soon as he was tackled about his course of dishonesty and had made a full confession. Moreover, upon being ultimately charged he pleaded guilty at the earliest possible stage, at committal proceedings listed for mention. Moreover, he had instructed solicitors to negotiate with the authorities and an arrangement of the kind I have mentioned was made with a view to achieving ultimate repayment.

The applicant gave evidence himself on the plea. He indicated remorse. The judge accepted that he was remorseful. His Honour also accepted, as I would gather it, that the applicant had had an intention to repay the money which he had illicitly obtained from the Commonwealth. Then there were the circumstances of the applicant, his wife, his children and his wider family, which were put into the balance as meriting, so it was submitted, a lenient sentence. Again, the matter of delay was placed before the judge as an extenuating circumstance which he ought to take into account. The judge declined to do so and that forms the basis for the first ground of appeal under the application which I shall mention.

As I have indicated, the interview by the customs officers took place in February 1995 in respect of offences which had been committed over the preceding 7 or 8 months. The applicant was co-operative and made a full confession, yet he was not charged for almost exactly a year after that. Then there was further delay, until March 1997, until arraignment and the matter was not disposed of until 9 April.

In the interval between confession and arraignment the applicant had, not to labour the point, a most anxious time. He was for most of it an undischarged bankrupt and he and his wife and children and his parents had narrowly escaped eviction from their property that they had worked for very many years. The applicant had, during that period, negotiated the manner of repayment with the Commonwealth which depended, of course, upon his continuing to work the property on strict terms. The learned judge was invited on the plea to take account of the delay in formulating the sentence. There is no doubt that proper sentencing principles dictate that undue delay in the disposition of a charge should work in favour of a prisoner being sentenced. The remarks of Sir Laurence Street in R. v. Todd (1982) 2 NSWLR 517 at pp. 519 and 520 have not infrequently been adopted by this court upon the point. Again, the remarks to a similar effect of the Court of Criminal Appeal in R. v. Kane [1974] VicRp 90; [1974] VR 759, at 767 have not infrequently been applied. Most particularly is the matter of delay between the commission of offence and the imposition of a sentence for it to be taken into account when rehabilitation is a real prospect; and it is no less so when the person to be dealt with has been at large and has ordered his affairs during the period of the delay with a view to reorganizing his life. That is what happened here.

Prosecuting counsel before the judge made the point that here the delay had not been inordinate. There is, in my opinion, no requirement that a delay should be inordinate before it deserves to be taken into account in accordance with the principles adopted in the cases I have mentioned. The learned judge at page 63 of his sentencing remarks simply asseverated that there had not been any such delay as should bring about any diminution or lessening of an otherwise appropriate sentence. His Honour gave no explanation of that statement and attempted no investigation of the circumstances upon which the applicant had relied for the application of the relevant principle. That, in my opinion, reveals error. There was a year of unexplained delay between the time the applicant made a clean breast of it to the Commonwealth authorities and the time he was charged on summons. A subsequent delay of some further 14 months before he was dealt with may or may not have been attributable to the pressure of the County Court's business, but none of the 26 months delay, it must be said, was attributable to the applicant himself. He was entitled to have the delay overall taken into account in the determination of the disposition of his case and he was denied it. That is enough to entitle the applicant to have the sentence set aside and fresh sentence imposed by this court.

Strictly, it is unnecessary to consider the other grounds, but I shall say something shortly about them. Counsel for the applicant before the judge evidently irritated his Honour in the way he dealt with the matter of mercy. Counsel lead into the point by saying, after enumerating a number of extenuating circumstances, and in particular referring to the anguish which his client had already been through in his attempts to save the farm, provoking his Honour to remind him that he was not a jury, to which counsel, perhaps unwisely, retorted, "No, but you are a human being, with respect, Your Honour", and he went on to say that he urged the judge in this case, in addition to all the matters he had just enumerated, "To exercise the judicial discretion of mercy". The mention of mercy, and the submission or suggestion that the judge should in his discretion show it, appears to have stung the judge. At all events, it provoked His Honour to say, "When counsel say that I always say to counsel, 'I am not here to dispense mercy, I am here to dispense justice'". I am not at all sure, with the benefit we now have of hindsight, that the exchanges between the judge and counsel which followed, centering upon the concept of mercy, did not serve to divert attention from the matters which it was incumbent on the judge to balance in determining the appropriate sentence. At all events, I regret to say that the exchanges were scarcely edifying. A more accurate way of putting counsel's point, and perhaps a more attractive way of putting it as a matter of advocacy, was to say that a proper consideration and evaluation of all the relevant extenuating circumstances conduced to clemency such that a merciful sentence should be imposed. That has the ready authority of R. v. Gherghe (10 October 1990) in which Murphy J, speaking for the Court of Criminal Appeal, said:

"Oftentimes the fact that a person has had some compelling extenuating motive for the acquisition of money has been seen by the court as a good reason for tempering justice with mercy, mercy perhaps which may not have been appreciated by the applicant, nor indeed perhaps by the public generally".

Counsel for the applicant relied before us this morning on the statement of Windeyer J in Cobiac v. Liddy [1969] HCA 26; 119 CLR 257 at 269 where his Honour, speaking of mercy, said, it was not that "... mercy, in Portia's sense, should season justice. It is that a capacity in special circumstances to avoid the rigidity of inexorable law is of the very essence of justice". His Honour there was considering a case in which a statute fell to be interpreted which said, in effect, that the penalties which it provided for motor offences "shall not be reduced or mitigated in any way" except as was provided. The context, therefore, was not quite the same as the context in which the concept of mercy was raised here, but it cannot be doubted that an element of mercy has always been regarded, and properly regarded, as running hand in hand with the sentencing discretion (see R. v. Osenkofski (1982) 30 SASR 212; R. v. Parker, a decision of the Court of Criminal Appeal, 22 June 1988; R. v. Carter, a decision of this Court, 14 February 1997).

The judge, after leave had been granted to the applicant to add to his grounds of appeal the ground dealing with mercy, submitted a report to this court in which he said:

"I did not, '(reject) that the element of mercy was relevant to the exercise of the sentencing discretion' nor did I, by the words I used, intend to convey such a meaning. I did not and could not make such an obviously incorrect statement".

"By my use of the words, 'I am not here to dispense mercy, I am here to dispense justice', I was referring in summary to what was stated by the Full Court of the Supreme Court in R. v. Kane ... "

and then his Honour quoted a passage from that case at page 766.

The statement was repeated by His Honour twice more in the course of the plea and I am led by his repetition of it, and the circumstances in which he spoke the words, to say this. It may be, as the judge said, that when he is invited to exercise mercy he always says to counsel, "I am here to dispense justice, not to dispense mercy". If it be so, I would suggest, with due respect, that his Honour give consideration to ceasing the practice. It may be an aphorism or apothegm that trips readily enough off the tongue. It is, however, if not strictly inaccurate, apt to mislead, and to mislead in particular anyone not versed in the law who happens to hear it. Moreover, it is in no way helpful in an intelligent understanding of the sentencing task. That the judge felt obliged to explain himself in a report to this Court seems to me in itself to amount to an indictment of the practice. A judge following sound practice in hearing a plea for leniency should not find it necessary to say what his thrice repeated, emphatically stated, non-technical words were intended to convey.

As I say, it is unnecessary to pass upon the validity of the ground of the application which relies upon the judge's treatment of the submission that was made to him in respect to the exercise of mercy. I hope, however, what I have said about it will have some effect.

The final ground of the application for leave relied upon the judge's supposition, as stated in his sentencing remarks, that the applicant's younger brother could work the property during the applicant's incarceration. All I want to say about that is that I think there was no evidence and no other basis which could have led the judge to sentence the applicant upon that supposition.

The ground that the sentence was manifestly excessive was not, I think, separately relied on. I will say nothing about it.

The sentence which this Court should pass, setting aside that which was imposed by the judge is, in my opinion, certainly not to be imposed upon the footing this was not a serious crime. It was undoubtedly serious and the sentence must reflect a degree of general deterrence.

In the circumstances I would propose that a sentence of 18 months' imprisonment be imposed and that the applicant be released on recognisance, on conditions, after having served three months of the sentence.

I agree with Tadgell JA that this application should be allowed. I also agree with the resentencing that he proposes and I agree with the reasons for which his Honour proposes that course.

I agree with the disposition of this application proposed by Tadgell JA and with his Honour's reasons. I add these short comments in relation to ground 3. The learned judge, in the course of the plea, not once, but three times, asserted to the applicant's counsel that he was "not here to dispense mercy, I am here to dispense justice". Counsel attempted to dissuade the learned judge from this view by reference, first, to paragraph 4.008 of the Sentencing Manual. The learned judge dismissed the manual as not being a decision of the court. When counsel then began to refer to caselaw, his Honour said that "no matter how many authorities you might refer me to, I am not here to dispense mercy".

Mr Robinson, for the Crown, submitted to this Court that the learned judge did not reject mercy as an element in the sentencing discretion. He put it that the judge recognized that mercy can be a factor to be involved in the instinctive synthesis of the sentencing judge in imposing a just sentence, but only one factor among many in the overall endeavour to do justice. The approach argued for by Mr Robinson is in itself unimpeachable and if that was his Honour's view, no error of law is established under ground 3. The words used by his Honour according to the transcript, were, I think, unfortunate in that they were likely to give the impression to the applicant, his advisers and anyone present in the learned judge's court that his Honour emphatically rejected that mercy was a concept relevant to the performance of his sentencing obligations.

The correct approach was, with respect, stated in R. v. Kane [1974] VicRp 90; [1974] VR 759, at p.766, by Gowans, Nelson and Anderson JJ in the passage previously referred to by Tadgell JA. The reference in this passage in Kane to mercy being exercised by considerations which are supported by the evidence and which make an appeal not only to sympathy, but to well-balanced judgment echoes the caution expressed by the New Zealand Court of Appeal in R. v. Radich [1954] NZLR 96, to the effect that if a court is weakly merciful and does not impose a sentence commensurate with the seriousness of the crime, it fails in its duty. But as Windeyer J said in Cobiac v. Liddy [1969] HCA 26; (1969) 119 CLR 257 at p.269: "The whole history of criminal justice has shown that severity of punishment begets the need of a capacity for mercy".

The relevance of mercy to an exercise of sentencing discretion reflects the Coronation Oath taken by the Sovereign on 4 November 1952. Her Majesty was asked by the Archbishop of Canterbury: "Will you to your power cause law and justice in mercy to be executed in all your judgments?". I do not think Her Majesty's acceptance of this oath was merely an undertaking to exercise the Royal Prerogative; rather the Oath recognises that, as counsel for the applicant submitted, mercy is but an aspect of the exercise of the sentencing discretion.

In R. v. Osenkowski (1982) 30 SASR 212, King CJ, at pp.212-13, said that -

"It is important that prosecution appeals should not be allowed to circumscribe unduly the sentencing discretion of judges. There must always be a place for the exercise of mercy where a judge's sympathies are reasonably excited by the circumstances of the case. There must always be a place for the leniency which has traditionally been extended even to offenders with bad records when the judge forms the view, almost intuitively in the case of experienced judges, that leniency at that particular stage of the offender's life might lead to reform".

This statement was approved by Winneke P in R. v. Carter (unreported, 14 February 1997) at pp.12-13 and in R. v. Clarke [1996] VICSC 30; [1996] 2 VR 520 at p.523 by myself in a judgment with which Winneke, P and Hayne JA agreed.

The learned judge was indeed, as he said, there to dispense justice. His Honour was also there to consider whether, on the evidence before him, a reasonable basis existed in well-balanced judgment for adopting a course which might bear less heavily on the applicant than if he were to receive his just deserts. It would be quite wrong for anyone to have thought that our system of justice did not entitle the prisoner standing for sentence to receive proper consideration of any claim he may legitimately have had to the exercise of clemency.

The formal order of the court will be: The application for leave to appeal against sentence will be allowed. The appeal is treated as having been instituted and heard instanter and the appeal too will be allowed. The sentence imposed below is quashed and in lieu thereof the applicant is sentenced to a term of 18 months in prison. In respect of that sentence, which will commence in accordance with our law today, we order that the applicant be released after serving a period of 3 months' imprisonment upon his giving security by recognisance in the sum of $200 upon condition that he be of good behaviour for the balance of the sentence of 18 months after he is released. Pursuant to s.16E of the Commonwealth Crimes Act 1914, we declare that the period of 77 days already spent in custody be reckoned as time served pursuant to the sentence which we have imposed, and we further direct that this declaration be noted in the records of the court.

We also confirm the reparation order in favour of the Commonwealth of $70,236 or such balance of it as remains outstanding.

Now, Miceli, the effect of what we have done is to reduce the time to be spent in gaol by you from six months to three months. That means that you have about another 14 or 16 days to go, do you follow that?

But I want you to understand that you will be required to sign a recognisance and enter into a recognisance to be of good behaviour from the time that you are released until the expiration of the 18 months which is the head sentence imposed; do you follow that?

That simply means when you get out of gaol you are not getting out scott free, as it were, but you will be on your good behaviour and beholden to that good behaviour to this court until the expiration of the 18 months of the head sentence; do you follow?

If you breach that good behaviour bond you will be brought back to be dealt with; do you understand that?

Save that a bond has actually been prepared in relation with the order of the court.

Perhaps he can sign it now. You are happy to enter into this bond, are you, Mr Miceli?

Perhaps if Mr Tehan can bring it to you you might sign it and we will get rid of the paperwork here and now.

In relation to the bond, the nature of the form of the order under the terms of the Commonwealth Crimes Act, the court imposing the sentence signs.

I don't see how I can make the recognisance. I think it was the fact or is the fact that the court has to sign the recognisance.

I have to confirm it on behalf of the court. That is what I have done in the past.