Regina v Hart

COUNSEL : C P O'Donnell (Crown) P Little (Respondent) SOLICITORS : Commonwealth DPP (Crown) W R Goodman & Associates (Respondent) CATCHWORDS : Criminal Law and Procedure: Crown Appeal against sentence; social security fraud, exceptional case due to ill health, disabilities and age. CASES CITED: De Vroome (1988-9) 38 A Crim R 146, Mears (1991) 53 A Crim R 141, Medina (CCA, 28 May 1990, unreported), Price (CCA, 2 September 1993, unreported), Purdon (CCA, 27 March 1997, unreported), Redden (CCA, 18 July 1997, unreported), Sopher (1993) 70 A Crim R 570, Winchester (1992) 58 A Crim R 345 DECISION : Appeal dismissed

IN THE COURT OF CRIMINAL APPEAL 60340/99 MEAGHER JA SIMPSON J SPERLING J Monday 26 July 1999

1 MEAGHER JA: I will ask Mr Justice Sperling to give the first Judgment. 2 SPERLING J: This is a Crown appeal against sentence. The respondent's husband died on 12 May 1987. On 18 May 1987, the respondent applied for an aged pension which became payable on 28 May 1987. 3 During his lifetime, the respondent's husband was in receipt of Commonwealth superannuation payments. Following his death, an entitlement to such payments accrued to the respondent. Such payments commenced on 27 August 1997, with arrears to 13 May 1987. Thereafter, the respondent continued to draw the aged pension without disclosing the receipt of the superannuation payments. Had disclosure been made, the aged pension would have been reduced.

4 Over a period of some ten years, an overpayment of $75,597 was made. The respondent was charged with imposing on the Commonwealth by an untrue representation made by omission with a view to obtaining a benefit: Crimes Act 1914 (Cth), s 29B. The maximum prison sentence for this offence is two years, which places the offence in the lower range of offences involving dishonesty in the estimation of the legislature.

5 On 2 June 1999, Garling DCJ ordered that the respondent perform 300 hours of community service, the respondent having pleaded guilty to the charge. The Crown has appealed against that sentence on the ground that it is manifestly inadequate.

6 The plaintiff was born on 14 October 1924. At the time of the sentence she was seventy-four years of age. There was a prior conviction for a similar offence which involved drawing unemployment benefits without disclosing that her husband, who was then living, was in receipt of superannuation benefits. The period of conduct relevant to the prior offence was 1981 to 1997.

7 In cases of fraud on the social security system, a custodial sentence should be imposed unless there are very special circumstances: Medina (CCA, 28 May 1990, unreported); Mears (1991) 53 A Crim R 141; Winchester (1992) 58 A Crim R 345 and Purdon (CCA, 27 March 1997, unreported).

8 The offender's psychological and medical health and age may increase the hardship of a sentence and may therefore be taken into account in deciding what sentence is appropriate, but that consideration is limited by the necessity of maintaining proper standards of punishment: Sopher (1993) 70 A Crim R 570; Price (CCA, 2 September 1993, unreported); Redden (CCA, 18 July 1997, unreported) and De Vroome (1988-9) 38 A Crim R 146.

9 The sentencing Judge made the following finding so far as is presently relevant:

The respondent was in poor health. She suffered from diabetes requiring self-administered injections of insulin four times a day; regular meals and snacks between meals; from irritable bowel syndrome for which she had recently undergone surgery; from hypertension; and from osteoarthritis of the knee and ankle for which she had recently undergone surgical treatment and which restricted her ability to walk any distance. Additionally, the respondent suffered from a speech disorder and impaired hearing which restricted her ability to communicate. His Honour recorded that Dr Roth said in a report, tendered without objection, and on which the doctor was not required for cross-examination: "A full time custodial sentence would significantly threaten her diabetic control and probably result in exacerbation of her irritable bowel syndrome. Because of her arthritis Mrs Hart is required to depend on taxis to get round Ulladulla. She has no car and would find it extremely difficult to use public transport to travel to and from Wollongong on a regular basis. The degree of travel involved and the timetable to undertake such travel would also have a significant impact on her diabetes and her osteoarthritis, both of which would probably deteriorate as a result."

His Honour accepted as true that the respondent had not believed she was required to disclose her receipt of superannuation benefits following her husband's death or that receipt of such benefits counted as "income" for the purpose of assessing her entitlement to a full aged pension. That finding was not open to his Honour as it was inconsistent with the plea of guilty by which the respondent admitted the necessary elements of the offence, including that the relevant benefit - the full aged pension - was obtained dishonestly.

His Honour accepted as correct information provided in a Probation and Parole Service report that medical services were extremely limited at the relevant periodic detention centre which was at Unanderra and that the respondent's overall health would make transport to and from the centre unduly difficult.

His Honour noted that the respondent had pleaded guilty to the charge and had co-operated with the authorities. She had expressed remorse for her actions.

His Honour found that a community services order would be carried out by the respondent only with extreme difficulty.

10 The line of reasoning which led his Honour to the resultant sentence was as follows: He noted the respondent's ill-health and other disabilities. He noted the prior conviction. He noted the respondent's belief, as he found it, that she had not been obliged to disclose her receipt of superannuation benefits and that those benefits were not relevant to her entitlement to a full aged pension. He noted the plea of guilty, the respondent's co-operation and her expressed remorse for her actions. 11 He acknowledged, by reference to the authorities, that a term of imprisonment was the normal consequence of this offence. He went on to say that, but for the respondent's state of health, he would have sentenced the respondent to quite a lengthy period of periodic detention. Because of her poor state of health, that was not to be done. Even carrying out community service would be extremely difficult for her, as his Honour found. This was, according to his Honour, an exceptional case.

12 The sentencing process is vitiated by at least one error of fundamental importance, that is, the acceptance by his Honour, inconsistently with the plea, that the respondent was not aware that she was obliged to disclose the superannuation benefits she came to receive and that these benefits were material to her entitlement to receive the full aged pension.

13 It is unnecessary in these circumstances to resolve other criticisms of his Honour's approach, including whether a sentence to be served by periodic detention could be sufficient in the ordinary case. This Court is then required to re-sentence the respondent unless, for good reason, it exercises its discretion not to interfere with the sentence.

14 In my opinion, the Court should not interfere. This is an exceptional case. The respondent's age and the nature and extent of the respondent's ailments and disabilities make it so. On the undisputed evidence compliance with the community services order will involve a significant degree of hardship in this case in view of the respondent's ailments and disabilities.

15 The amount of money involved is substantial but the maximum penalty prescribed places the offence in the lower range of crimes of dishonesty, as I have said. It is also to be recognised that the respondent's non-disclosure was much less culpable than the kind of reported case where there is repeated positive misrepresentation, such as the use of multiple false names.

16 There was the plea of guilty and there are the deductions from present entitlements which will go some way to reimburse the Commonwealth. Any fresh sentence would have to be ameliorated under the principle of double jeopardy.

17 Whilst the sentence under appeal may have been inadequate as a sentence at first instance and whilst this judgment should not stand as a precedent for such sentences, any sentence that is re-determined by this Court under the principles applicable to Crown appeals would not, in my view, vary sufficiently from that under appeal to make it appropriate for this Court to intervene.

18 For those reasons I would propose that the appeal be dismissed. 19 MEAGHER JA: I agree. 20 SIMPSON J: I agree. I am familiar with and I have, for the purposes of this appeal, re-read the many cases concerning fraud on the Social Security system. I agree with what has frequently been said. Social Security fraud is theft from the revenue and is an imposition on every honest taxpayer in the Commonwealth of Australia. It is a most serious offence. 21 I cannot, however, ignore nor participate in the perpetuation of the apparent double standard that applies, and treat Social Security fraud as different from taxation fraud. That such a double standard apparently exists was conceded by the Crown in the course of argument. To my mind the two offences are indistinguishable. Each involves fraud on the revenue and each imposes a greater burden on honest taxpayers.

22 There are ample precedents for lenient sentences being imposed on tax offenders, often in relation to vastly larger sums of money and in cases where the mitigating circumstances are less compelling than in this case.

23 For those reasons and for the reasons given by Justice Sperling, I agree with the order proposed.

24 MEAGHER JA: The order of the Court therefore is that the appeal is dismissed.

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