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[2006] VSCA 1
Court of Appeal (Vic)
2006-01-25
CALLAWAY, CHERNOV and VINCENT, JJ.A.
Original judgment source is linked above.
Criminal law - Defrauding the Commonwealth - Failing to declare assessable income - Obtaining payments of pension to which accused not entitled - Whether indictment containing sufficient description of conduct charged in relation to failure to declare assessable income - Whether counts relating to payments of pension disclosing more than one offence or resulting in uncertain verdict - Convictions quashed and judgments and verdicts of acquittal entered - Crimes Act 1914 (Cth), s.29D - Crimes (Criminal Trials) Act 1999 (Vic.), s.6
1 These are applications for leave to appeal against conviction and sentence by Little Joe Rigoli and his father, Virgilio Rigoli, who were tried in the County Court together with Robert Palazzolo[1] on 30 counts of defrauding the Commonwealth contrary to s.29D of the Crimes Act 1914 (Cth). For convenience I shall refer to the applicants as "Little Joe" and "Virgilio" respectively. After a trial occupying 39 days, the jury found Little Joe guilty on counts 9, 20, 22 and 24 and found Virgilio guilty on counts 5, 7, 19, 21, 23 and 25. Palazzolo was found guilty on counts 6, 8 and 27. He has not sought leave to appeal but the Registrar has received an application from him for an extension of time within which to do so. The jury acquitted the three accused on the other counts relating to each of them.
2 All the counts on which Little Joe was found guilty were of defrauding the Commonwealth by failing to declare assessable income. That was true also of all the counts on which Virgilio was found guilty, except count 25, which was of defrauding the Commonwealth by obtaining payments of invalid pension/disability support pension to which he was not entitled.
3 After hearing a plea for leniency on their behalf, the learned trial judge sentenced the applicants on 29th July 2005. His Honour sentenced Little Joe to 12 months' imprisonment on count 9, commencing on 29th July 2005; 12 months' imprisonment on count 20, commencing four months after the commencement of the sentence on count 9; 12 months' imprisonment on count 22, commencing four months after the commencement of the sentence on count 20; and 12 months' imprisonment on count 24, commencing four months after the commencement of the sentence on count 22. That resulted in a total effective sentence of two years' imprisonment, of which Little Joe was ordered to serve 16 months and then to be released on recognisance. His Honour sentenced Virgilio to 15 months' imprisonment on count 5, commencing on 29th July 2005; 15 months' imprisonment on count 7, commencing four months after the commencement of the sentence on count 5; 15 months' imprisonment on count 19, commencing four months after the commencement of the sentence on count 7; 15 months' imprisonment on count 21, commencing four months after the commencement of the sentence on count 19; 15 months' imprisonment on count 23, commencing four months after the commencement of the sentence on count 21; and 15 months' imprisonment on count 25, commencing four months after the commencement of the sentence on count 23, together with a fine of $25,000 on that count. That resulted in a total effective prison sentence of two years and 11 months, of which Virgilio was ordered to serve 24 months and then to be released on recognisance. A declaration regarding 38 days' pre-sentence detention was made in respect of each applicant.
4 In the light of the conclusions I have reached, there is no need to say very much about the facts. Between 1989 and 1996 Virgilio established a manufacturing plant designed to produce polystyrene boxes. He did so with the assistance of Little Joe and Palazzolo. The boxes were sold to the vegetable growing and fisheries industries for packaging of their product, the first known sale by the Rigoli family being on 27th April 1990. The counts on which the applicants were convicted, except count 25, proceeded on the basis that they defrauded the Commonwealth by failing to declare assessable income derived by them in connection with that business. Count 25 proceeded on the basis that such income disentitled Virgilio from the pension that he received.
5 Little Joe seeks leave to appeal against conviction on seven grounds and against sentence on five grounds. In his full statements filed pursuant to Rule 2.09 of the Supreme Court (Criminal Procedure) Rules 1998 Virgilio sought leave to appeal against conviction on 18 grounds and against sentence on four grounds. Mr Croucher did not press grounds 1, 2, 3, 5, 6, 14, 15, 16 and 17 of the grounds of appeal against conviction, but he sought leave to add new grounds numbered 19 and 20(a)[2] and a fifth ground of appeal against sentence. The Court permitted those grounds to be argued, reserving its ruling as to whether leave should be granted to add them.
6 It is unnecessary to refer in detail to the grounds, or to rule on Mr. Croucher's application for leave to amend, because, as it happens, the case may be dealt with by deciding two points. The first point arises from the form of the counts on which the applicants were found guilty, except count 25. Count 5 reads:
"AND the DIRECTOR OF PUBLIC PROSECUTIONS further INFORMS THE COURT AND CHARGES that on the 31st day of October 1993 at Shepparton in the State of Victoria VIRGILIO RIGOLI did, contrary to section 29D of the Crimes Act 1914, defraud the Commonwealth by failing to declare assessable income for the financial year ending 30 June 1993."
Counts 7, 9 and 19 to 24 were in the same form.
7 It will be observed that the essence of each count was that the accused did, contrary to s.29D, defraud the Commonwealth by failing to declare assessable income for a specified financial year. Section 29D provided[3]:
"A person who defrauds the Commonwealth or a public authority under the Commonwealth is guilty of an indictable offence.
Penalty: 1,000 penalty units or imprisonment for 10 years, or both."
Mr. Silbert submitted, and I accept for the sake of argument, that the words "by failing to declare assessable income for [the specified financial year]" were only particulars and that the statement of the offence was that the accused defrauded the Commonwealth contrary to s.29D. Even so, count 5, and the other counts in like form, as so particularised, are an insufficient description of the conduct with which the applicants were charged.
8 It was conceded by the Crown at the trial and again at the hearing of the applications that one cannot defraud the Commonwealth merely by failing to declare assessable income. The live issue was what more was required. On one view there had to be a mental element in addition to the failure to declare assessable income, for example, a deliberate failure with the purpose of preventing or impeding the Commonwealth from receiving revenue to which it was entitled. On another view, positive**,** or on all events additional, conduct was required. In the prosecutor's opening before the jury he referred to such additional conduct, including the accused "taking considerable pains to avoid creating records or leaving any evidence from which their expenses could be calculated" and attempting to conceal their expenses by taking cheques from customers and endorsing them over to suppliers. He also said that the accused made "a decision" not to lodge income tax returns and that, by "wilfully" failing to lodge returns, they defrauded the Commonwealth.
9 Neither an additional component in the form of a mental element nor an additional component in the form of positive or additional conduct could be found expressly or by implication in the counts on the indictment. Mr. Silbert submitted that regard could nevertheless be had to the summary of prosecution opening served on the defence and filed pursuant to s.6 of the Crimes (Criminal Trials) Act 1999 (Vic.). There were references to both a mental element and additional conduct in various places in that summary. In my opinion, an ambiguity in an indictment may be resolved by reference to a summary served and filed pursuant to s.6. I do not say that every ambiguity may be so resolved. The difficulty in the present case is that ambiguity is not the vice in the relevant counts on the indictment. The words "failing to declare assessable income" are unambiguous. What is needed is an additional component, whether in the form of a mental element or additional conduct. That omission from the indictment cannot be supplied by the summary of prosecution opening[4]. It is unnecessary to consider whether the omission might be rectified by the formal provision of further particulars.
10 In R. v. Iannelli[5] the New South Wales Court of Criminal Appeal appears to have accepted that the offence of defrauding the Commonwealth contrary to s.29D could not be committed by omission[6]. If that is so, the relevant counts on the indictment do not disclose an offence. I refrain from deciding, however, whether that view is correct or whether this Court would be bound to adopt it if it has been accepted in New South Wales, in conformity with the rule that we should ordinarily follow the decision of another intermediate appellate court on Commonwealth legislation[7]. It may be that a mere omission is sufficient, in an appropriate context, if it is deliberate and made with the purpose of prejudicing or imperilling the legal rights or interests of the Commonwealth[8]. In the present case, on either of the views referred to in [8] above, the relevant counts on the indictment did not afford a sufficient description of the conduct with which the applicants were charged. The defect is exacerbated by the specification of 31st October as the date on which the Commonwealth was defrauded. That was just the last date for lodging a return in the absence of an extension. It is quite likely that the allegedly fraudulent decision was taken before that date. Time is not of the essence[9], but the specification of 31st October in the relevant year reinforces the impression that the conduct charged is mere failure to lodge a return.
11 Mr. Silbert fairly conceded that, if that were our view, the convictions sustained by the applicants on counts 5, 7, 9 and 19 to 24 should be quashed and a judgment and verdict of acquittal entered on each of those counts. That is the course that I would take, but I desire to guard against misunderstanding. What I have written is confined to defrauding the Commonwealth by omission, assuming that that is possible[10], and I am not to be taken as saying that every element has to be particularised where an indictment charges the offence of defrauding the Commonwealth contrary to the former s.29D[11].
12 The second point referred to in [6] above arises from the form of count 25 on the indictment, the facts of the case and the way in which the learned judge charged the jury. Count 25 reads:
"AND the DIRECTOR OF PUBLIC PROSECUTIONS further INFORMS THE COURT AND CHARGES that between the 26th day of March 1992 and the 23rd day of May 2001 at Shepparton in the State of Victoria VIRGILIO RIGOLI did, contrary to section 29D of the Crimes Act 1914, defraud the Commonwealth, namely the Department of Family and Community Services, formerly known as the Department of Social Security, by obtaining payments of invalid Pension/Disability Support Pension to which he was not entitled."
13 The crime charged was defrauding the Commonwealth by obtaining payments to which Virgilio was not entitled. He did not make a false declaration. Rather he failed to inform the Department of changed circumstances, namely income derived in connection with the polystyrene box business, that disentitled him to continued receipt of the pension. Between 26th March 1992 and 23rd May 2001 there may have been some years in which his income disentitled him from continued receipt of the pension and other years in which it did not.
14 His Honour directed the jury, in part, as follows:
"On the other hand, if you are satisfied beyond reasonable doubt that during the period of 26 March 1992 to 23 May 2001 Mr Rigoli was, during any part of that period, in receipt of a nett income that exceeded the figures that I have mentioned for annual income, well then you would be satisfied of the first element, so the onus rests upon the Crown to establish beyond reasonable doubt that during the period March '92 to May 2001 at some time or times during that period that Mr Rigoli's nett annual income was in excess of those figures that I have mentioned." (Emphasis added.)
15 Mr. Croucher submitted that either count 25 disclosed more than one offence, because Virgilio may have obtained pension to which he was not entitled in two or
more years, or the verdict was uncertain because some jurors may have found that he received disentitling income at one time during the nine year period and other jurors may have found that he did so at another time or times[12]. Mr. Silbert accepted that at least the latter proposition was correct. The conviction on count 25, too, should be quashed and a judgment and verdict of acquittal entered on that count.
16 I have confined these reasons, and kept them as brief as possible, to avoid deciding unnecessary questions. I have been mindful also of the desirability of the applicants' being set at liberty as soon as the Court is satisfied that they should not have been convicted. It should be said, however, that the course I have adopted does less than justice to the careful arguments of counsel, both for the applicants and the Crown. Some of the points raised by the other grounds were of considerable interest and practical importance. Similarly, the narrow compass of my reasons implies no disrespect to the learned judge, who had the difficult task of presiding over a long and complex trial and assisting the jury in their almost four days of deliberations.
17 I agree, for the reasons given by Callaway, J.A., that these applications should be disposed of as his Honour proposes.
18 I agree with the disposition of these applications proposed by Callaway, J.A. and for the reasons advanced by him in his judgment.
[1] Palazzolo, also known as Phillip Robert Rigoli, is the eldest son of Virgilio Rigoli and a brother of Little Joe Rigoli.
[2] Proposed ground 20(b) was not pursued.
[3] Section 29D was repealed by Act No. 137 of 2000 and replaced by provisions of the Criminal Code.
[4] An accused person should not be required to trawl through the summary to discover missing components of the indictment. It is fortuitous that, in the present case, a mental component in the form of decision and intention, was clearly spelt out in paragraph 28 of the summary. References to additional conduct had to be searched for and their relevance, at best, inferred.
[5] [2003] NSWCCA 1; (2003) 56 N.S.W.L.R. 247.
[6] Handley, J.A. held that that was so. Simpson, J. dissented, but on the basis that there was evidence of implied misrepresentations. Bell, J.'s position was, with respect, equivocal. See 251 [20]-[23], 258 [63]-[65], 272 [121]-[122] and 274 [132]-[133].
[7] Deputy Commissioner of Taxation v. Woodhams [1998] VSCA 126; (1998) 148 F.L.R. 230 at 231. The New South Wales decision we there felt obliged to follow was overruled by the High Court on appeal; see Deputy Commissioner of Taxation v. Woodhams [2000] HCA 10; (2000) 199 C.L.R. 370, esp. at 375 [9], 382 [28] and 385 [39].
[8] There might be concealment, within the meaning of McHugh, J.'s judgment in Peters v. R. [1998] HCA 7; (1998) 192 C.L.R. 493 at 529 [84], by breaching a duty to disclose, but the point need not be decided.
[9] R. v. Dossi (1918) 13 Cr.App.R. 158.
[10] See [10] above. R. v. Hussein [2003] VSCA 187; (2003) 8 V.R. 92, the other case examined in the course of argument, involved positive conduct: see 93 [5]-[6], 96 [15]-[16] and 97 [19].
[11] Compare s.369 of the Crimes Act 1958 (Vic.).
[12] Compare Walsh v. Tattersall (1996) 188 C.L.R. 77 and R. v. Shannon [2005] VSCA 143.
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Rigoli & Rigoli [2006] VSCA 1