[1992] FCA 600; (1992) 64 A Crim R 281

Criminal Law - appeal against sentence - interference with judge's findings of fact - reliance upon judicial experience.

Appeal against sentence - property offences - element of general deterrence in sentencing of federal offenders - consideration of potential for rehabilitation - extent to which pecuniary penalty order to be taken into account in passing sentence.

Crimes Act 1914 (Cth)

Proceeds of Crime Act 1987

Pereira v. The Queen [1996] HCA 46; (1992) 4 Leg Rep C1

Director of Public Prosecutions (Cth) v. El Karhani (1990) 97 ALR 373

Davey [1980] FCA 134; (1980) 2 A Crim R 254

Feltwell (1987) 38 A Crim R 322

Chaloner (1990) 49 A Crim R 370

Bell (1981) 5 A Crim R 347

McDermott (1990) 49 A Crim R 105

Allen (1989) 41 A Crim R 51

R v. Fagher (1989) 16 NSWLR 67

R v. Araya; R v. Joannes (unreported, NSW Court of Criminal Appeal, 17 July 1992)

Solicitors for the appellant: Legal Aid Office (ACT)

Solicitors for the respondent: Commonwealth Director of

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

BURCHETT, MILES AND O'LOUGHLIN JJ. This is an appeal against the severity of a sentence imposed by Gallop J. in the Supreme Court of the Australian Capital Territory on 25 June 1992. The appellant was convicted on pleas of guilty to eleven charges of theft contrary to sub-s.71(1) of the Crimes Act 1914 (Cth) (the Crimes Act). The maximum sentence for each of the offences was seven years imprisonment. The appellant was sentenced to three years imprisonment on each charge, each sentence to be served concurrently with each of the others. His Honour made a recognizance release order pursuant to para.20(1)(b), namely that the appellant be released after serving eighteen months imprisonment upon entering into a recognizance self in the sum of $1,000 to be of good behaviour for a period of two years and during that time to submit himself to the supervision of the Director of Corrective Services, or some person appointed by him, and to obey his directions or the delegate's directions about his employment, his place of residence and his associates. His Honour also ordered the appellant to pay to the Commonwealth a pecuniary penalty of $75,500 pursuant to s.26 of the Proceeds of Crime Act 1987 (the Proceeds of Crime Act).

2. The facts were as follows. The appellant is a single man born on 1 May 1961 in Bega, New South Wales. He began work with the Commonwealth Bank after leaving school at the age of 17. He had a variety of jobs thereafter but was in employment most of the time. He started work with Australia Post in January 1985 as a postman in Bega. He received training as a postal clerk and was transferred to the General Post Office, Canberra, in 1986. After two months he was assigned duties as an acting Postal Services Controller Grade 1. He occupied that acting position during most of the period he remained in the service of Australia Post.

3. The appellant's duties included the control of cash, cheques and credit card vouchers received from other post offices and banking them. He was also responsible for the use of franking machines, both within the General Post Office and by authorised customers. He was responsible for a system of credit to customers and payment by them for the use of franking machines. In mid-1991 routine checks by other officers established that there was a discrepancy between projected and actual receipts for franking machines. Record cards for which the appellant was responsible were missing. On 1 July 1991 the appellant undertook to produce the missing cards which he said were in storage. Two days later he gave notice of his resignation, to be effective from 5 July 1992, offering the reason that he wished to take up a position as a swimming-pool attendant on the south coast of New South Wales.

4. An audit took place within the General Post Office and, despite the absence of some records, it was established that the appellant had failed to account for a total of $75,500, made up of amounts which he now admits were stolen by him on or about the eleven dates set out in the charges, which fell between 13 March 1990 and 22 May 1991. In essence, the theft on each occasion involved the receipt by the appellant of a cheque from a franking machine customer, a failure to account for the cheque, the resetting of the franking machine and the taking of cash for which the cheque was then substituted.

5. When interviewed by police on 24 September 1991, the appellant was unwilling to admit his guilt or to give material assistance to them in resolving the apparent discrepancy in the Australia Post records. However, when he came before the Magistrates Court on 13 February 1992, he entered a plea of guilty under s.90A of the Magistrates Court Act 1930 (ACT), and was committed to the Supreme Court for sentence. Since then, he has assisted in the preparation of a pre-sentence report and has undergone counselling or therapy with a clinical psychologist for an addiction to gambling. It is clear that the appellant has for many years been a compulsive gambler who was successful in concealing that fact from the attention of his workmates and supervisors. He has no relevant history of criminal offences.

6. The Community Corrections officer, who prepared the pre-sentence report, said that, apart from his addiction to gambling, the appellant presented as an intelligent and stable person whose general morals and standards are socially acceptable and that he accepted full responsibility for his actions. The psychologist, Mr. Petroni, reported that he considered the appellant was not a classical habitual gambler, a main indication of which is that he is not a compulsive liar. Mr. Petroni also considered that the appellant was responding well to treatment.

7. Mr. Brewster for the appellant made three principal submissions. The first was that his Honour had made a number of errors of a factual kind which would justify this Court interfering with the sentence. It was submitted that his Honour's decision was affected by findings that "if (the appellant) had been working for a private individual, he would not have stolen" and "unfortunately there is some sort of mores that places like a post office are fair game". It was submitted that these remarks were not justified on the evidence or, if they were, they should not have been permitted to affect the sentencing discretion. However, in our view, both remarks were well within what was permissible on the part of a sentencing judge. It was undisputed, and indeed part of the appellant's case, that, whilst he had been employed in the private sector, he had never acted other than completely honestly. There was evidence from a local postal manager that there had been cases of theft by post office employees in recent years in the Canberra region, and his Honour was at all events entitled to use to the extent he did his knowledge of local affairs and the incidence of crime in the region.

8. In Pereira v. The Queen [1996] HCA 46; (1992) 4 Leg Rep C1, special leave was sought to appeal to the High Court against a decision of the New South Wales Court of Criminal Appeal which equated the culpability of the importation of cocaine with that of heroin. Mason C.J. referred to the approach of the Court of Criminal Appeal as "based upon judicial experience, if not judicial notice". He saw no foundation for regarding it as erroneous. In our view, the trial judge here was also entitled to place relevant reliance on his judicial experience.

9. The next submission was that the head sentence of three years imprisonment was too long, as was the recognizance release period of eighteen months, and that in any case it was an excessive punishment to order the term of imprisonment to take effect immediately having regard in particular to the appellant's good character and positive prospects of rehabilitation. This submission has to be based on the premise that his Honour failed to have proper regard to these matters or failed to give proper weight to them. However, his Honour's remarks on sentence, although brief, indicate clearly that these matters were taken into account and the appellant is ultimately left with the argument that his Honour gave undue weight to the element of general deterrence over the rehabilitative aspects of the case.

10. Although it was properly conceded by Mr. Brewster that his Honour was entitled to take general deterrence into account, it is desirable to say something about the position of general deterrence in the sentencing of federal offenders since the amendment of the Crimes Act which came into operation on 17 July 1990 through the introduction of Part 1B (ss.16 to 21F) of the Crimes Act. Part 1B, whilst not a code, lays down a fairly comprehensive sentencing regime for federal offenders. In particular Division 2 of Part 1B is concerned with general sentencing principles and s.16A specifies a number of matters to which a court must have regard in passing sentence. It provides as follows:

"Matters to which court to have regard when passing sentence

etc.

16A.(1) In determining the sentence to be passed, or the order

to be made, in respect of any person for a federal offence, a

court must impose a sentence or make an order that is of a

severity appropriate in all the circumstances of the offence.

(2) In addition to any other matters, the court must take

into account such of the following matters as are relevant and

known to the court:

(a) the nature and circumstances of the offence;

(b) other offences (if any) that are required or permitted

to be taken into account;

(c) if the offence forms part of a course of conduct

consisting of a series of criminal acts of the same or

a similar character - that course of conduct;

(d) the personal circumstances of any victim of the

offence;

(e) any injury, loss or damage resulting from the offence;

(f) the degree to which the person has shown contrition for

the offence;

(i) by taking action to make reparation for any

injury, loss or damage resulting from the

offence; or

(ii) in any other manner;

(g) if the person has pleaded guilty to the charge in

respect of the offence - that fact;

(h) the degree to which the person has co-operated with law

enforcement agencies in the investigation of the

offence or of other offences;

(j) the deterrent effect that any sentence or order under

consideration may have on the person;

(k) the need to ensure that the person is adequately

punished for the offence;

(m) the character, antecedents, age, means and physical or

mental condition of the person;

(n) the prospect of rehabilitation of the person;

(p) the probable effect that any sentence or order under

consideration would have on any of the person's family

or dependants.

(3) Without limiting the generality of sub-sections (1)

and (2), in determining whether a sentence or order under

subsection 19B(1), 20(1) or 20AB(1) is the appropriate sentence

or order to be passed or made in respect of a federal offence,

the court must have regard to the nature and severity of the

conditions that may be imposed on, or may apply to, the

offender, under that sentence or order."

11. From an examination of the matters specified in sub-s.16A(2) it is immediately apparent that the matters specified (with the possible exception of matter (p), the probable effect of the sentence on the offender's family or dependants) are all matters which sentencing courts ordinarily took into account prior to the amending legislation. For instance, the element of particular deterrence, that is to say, the likely deterrent effect of the sentence on the offender, is specified in matter (j). On the other hand, whilst the list of matters specified is not exhaustive, and matters specified are to be taken into account "in addition to any other matters", there is no mention of general deterrence. The question arises whether a court in sentencing a federal offender is entitled to take general deterrence into account, and, if so, to what extent. This question received the attention of the New South Wales Court of Appeal in Director of Public Prosecutions (Cth) v. El Karhani (1990) 97 ALR 373. After referring to authorities, including the decision of this Court in Davey [1980] FCA 134; (1980) 2 A Crim R 254, the Court affirmed the "fundamental principle of sentencing, inherited from the ages" that one of the main purposes of punishment is to protect the public by the deterrence of potential offenders through fear of similar punishment. The Court concluded at 380-381:

"The language of the Act gives no support for the proposition

that general deterrence has been removed from the list of

criteria to be considered by a court sentencing a person for a

federal offence. On the contrary, s.16A(1) imposes on the

court the duty, which is its primary obligation, to ensure that

the sentence or order "is of a severity appropriate in all the

circumstances of the offence". It is by this duty that the

general principles of sentencing law are imported into the

function of a court imposing a sentence on a federal offender

convicted of the offence. What will be "appropriate" will

depend, in part, upon a consideration of fundamental notions,

such as that of general deterrence.

The list of particular considerations in s.16A(2) must be read

as subject to the primary obligation of the court stated in

s.16A(1). All that s.16A(2) requires is that the court should

"take into account" the listed matters. They provide a

catalogue of matters to be considered in determining the

"severity appropriate in all the circumstances of the offence".

However, the opening words of s.16A(2) must be noticed. They

state that the matters there listed are to be taken into

account "in addition to any other matters". These words make

it plain beyond argument that the legislature was not seeking,

by the list, to exclude other relevant matters. One other such

relevant matter is clearly the general deterrent effect of the

sentence. As in this case, that may be equally important as

the effect on the offender."

12. We agree with the conclusion and the observations and would only add that there is nothing in s.16A to suggest that general deterrence should be accorded less importance, or more, than the other factors expressly mentioned. In this respect s.16A has not ousted the general principles of sentencing law, which have always given general deterrence a significant place.

13. In our view, Gallop J. was correct in putting emphasis on the element of general deterrence in sentencing a man who had abused a position of trust on no less than eleven occasions over a period of a year or so in order to steal a substantial amount of money from a public authority for the purpose of indulging an addiction to gambling. It is true that there is no rule of law that in all such circumstances an immediate custodial sentence is inevitable, and it is true that every case depends upon its own circumstances. But unless the Court can find particular circumstances, whether labelled "special", "extraordinary", or otherwise, the indications in the authorities are that such a sentence will generally be the appropriate sentence.

14. Reliance was placed on the decision in Feltwell (1987) 38 A Crim R 322. The appellant, a postal clerk, pleaded guilty to two charges of stealing stamps worth a total of $30,000. The New South Wales Court of Criminal Appeal by a majority considered that the trial judge was manifestly in error in deferring sentence upon the appellant entering into a recognizance to be of good behaviour for five years, the recognizance including a condition that he repay the value of the stolen stamps by way of restitution. The majority expressed the view that the trial judge had inadequately taken into account the requirement of general deterrence and that that inadequacy was of such degree as to fall outside the limits of the sentencing discretion, wide though that be. Enderby J., dissenting, laid emphasis on the fact that the appellant had by the time of the appeal paid more than $13,000 of the total sum by way of assignment of superannuation entitlement and other payments.

15. On the other hand, the decision of Kirby P., with whom the other members of the New South Wales Court of Criminal Appeal agreed, in Chaloner (1990) 49 A Crim R 370 was cited to the Court. That was a case of an assistant manager of a branch of the Commonwealth Bank who pleaded guilty to a single charge of defrauding a public authority under s.29D of the Crimes Act. He used his position to withdraw $122,160, which he took mainly in order to settle outstanding debts, some of which were connected with his own ill health and that of members of his family. He disclosed the fraud before it became fully apparent to the Bank and he paid his accumulated superannuation and long-service leave entitlements of $73,696 to the Bank in an effort to reduce his indebtedness. Kirby P. considered that the sentencing judge had erred in not specifically addressing the considerations of the repayment and the applicant's prior ill-health and, for the purpose of resentencing by the appellate court, these factors together with others constituted special circumstances which justified the suspension of the sentence.

16. In Bell (1981) 5 A Crim R 347, a solicitor pleaded guilty to four charges of fraudulent disposal of trust funds amounting to about $30,000 and was sentenced to three years imprisonment with a recommendation for eligibility for parole after nine months. The Queensland Court of Criminal Appeal held that the sentencing judge unduly fettered his discretion by attaching too much weight to the lack of a precedent for a non-custodial sentence. In what it considered special circumstances (including illness, full restitution and long delay in prosecuting the case) the Court considered that the rehabilitation of the appellant justified a non-custodial sentence.

17. We have no reason to question the principles of law upon which any of these decisions was based. Both Bell and Chaloner reflect the general principle that there must be a proper consideration of the importance of rehabilitation despite the seriousness of the offence. In the present case, the sentencing judge gave that aspect proper consideration.

18. The remaining question is whether the sentencing judge was in error in failing to consider, for the purpose of the sentence, the pecuniary penalty order made pursuant to s.26 of the Proceeds of Crime Act. In relation to the matter of restitution, his Honour said that there had been no realistic offer on the part of the appellant. In fact, the appellant had put aside some $1,600 which he had saved over a period of four months, and at that rate his Honour was correct in calculating that it would take some eleven years to pay back the amount stolen. However, his Honour did not say that he took into account the pecuniary penalty order which he was about to make and which he did make after pronouncing sentence. The question arises whether this in any way impugns the sentence.

19. The majority of this Court in McDermott (1990) 49 A Crim R 105 held that a pecuniary penalty order must be taken into account at the time of sentencing and that it was wrong in the circumstances of the case to regard the pecuniary penalty order as simply the removal of ill-gotten gains and not as an additional punishment. Different views have been taken on these matters in the courts of the States: see Allen (1989) 41 A Crim R 51, R v. Fagher (1989) 16 NSWLR 67 and R v. Araya; R v. Joannes (unreported, NSW Court of Criminal Appeal, 17 July 1992). In the lastmentioned case the Court considered McDermott but found it unnecessary to decide whether a sentencing judge may take into account an order for the confiscation of property, holding that that was a question which should await adjudication in an appropriate case.

20. Nevertheless, this Court should continue to follow McDermott and in doing so make the observation that there is nothing in McDermott to contradict the proposition that the extent to which a pecuniary penalty order should affect a sentence will depend on the circumstances. Where the pecuniary penalty order is not likely to have any impact upon the offender or his assets, it might have little or no impact upon the sentence. In McDermott it was considered likely that the pecuniary penalty order would be enforced against an interest which the offender had in some real property and possible that it would be enforced by garnishee proceedings. In the present case it is difficult to see how the pecuniary penalty order can be enforced at all, although naturally it is to be hoped that at some time after his release from prison the appellant will resume gainful employment. We were told that his superannuation benefits will not accrue to him until he is 55 years of age, some 24 years from now. Whether and to what extent the pecuniary penalty order can be enforced against that entitlement, we simply do not know. In those circumstances, we are unable to see any way in which the making of the pecuniary penalty order should have operated, or can operate, to affect the sentence that was imposed.

21. In the circumstances, we are not convinced that the head sentence or the recognizance release period was excessive, although each was at the upper end of the scale, nor that the sentence should have been suspended. The appeal is dismissed.