Regina v Kilpatrick

Johnson v The Queen 2004 78 ALJR 616 R v Ellis 1986 6 NSWLR 603 CASES CITED: R v Simpson 2001 53 NSWLR 704 R v Tadrosse [2005] NSWCCA 145 R v Thomson & Houlton 2000 49 NSWLR 383

PARTIES: Regina v Gary Thomas Kilpatrick

W. Dawe, QC (Crown) COUNSEL: G. Bashir (Applicant)

S. Kavanagh (DPP) SOLICITORS: S. O'Connor (Applicant)

LOWER COURT FILE NUMBER(S): 03/51/0181; 03/51/0192

IN THE COURT OF CRIMINAL APPEAL 2005/975

GROVE J HALL J SMART AJ

Friday 21 October 2005 REGINA v GARY THOMAS KILPATRICK JUDGMENT

1 GROVE J: This is an application for leave to appeal against severity of sentence imposed by Phelan DCJ in Wollongong District Court. The applicant had been charged with offences to which he pleaded guilty when appearing before the Local Court at Byron Bay and he was committed to the District Court at Lismore for sentence. His Honour commenced hearing sentence proceedings at that court and ultimately imposed sentence sitting at Wollongong on 14 September 2004. 2 All of the charges preferred against the applicant alleged obtaining money by deception contrary to s 178BA of the Crimes Act 1900. The prescribed maximum penalty for any such offence is five years imprisonment. The applicant pleaded guilty to sixty five charges. 3 It is both rational and convenient to deal with the offences, as his Honour did, in three groups. 4 The facts of the offences were manifested in a lengthy statement prepared by Detective Kelly, which his Honour treated as incorporated in his remarks on sentence. No challenge is made to the facts set out therein and it suffices for present purposes to refer to some facts without descending into minute detail. 5 The first group of twelve offences were committed between September 1997 and February 2001. Large amounts were obtained from various finance companies and institutions secured against property which, in the vast majority of cases, did not exist. In other cases the property was falsely described and evaluated. 6 The second series of offences involved the fraudulent use of credit card details. Police referred to these as MOTO (mail order/telephone order) offences. Orders were made for goods over the telephone and in each case a credit card number provided, as a result of which goods or services were supplied to the caller. The credit card numbers used by the applicant related to credit cards held by various customers of the National Bank of Australia. The particular cards were held by persons of highly rated credit standing, quite a number of them being members of the medical profession. The applicant had obtained these numbers from a co-offender who was a branch manager of the bank. The true customers who were entitled to use the credit cards would not be aware of the usage until they received routine accounts subsequent to the completion of the transactions. 7 The third group of offences were similar to those in the first group in that large amounts were obtained from finance institutions as a result of frauds committed in a variety of ways. To an extent there was some restitution available to victims as a house offered as security did in fact exist and was able to be sold for the purpose of recompense. 8 The applicant was one of a number of offenders and the Crown does not suggest that he was the recipient of all the monies extracted by means of the frauds. It is also apparent that, no doubt to avoid or at least delay detection, some funds were obtained in successive crimes in order to meet obligations already incurred, a process commonly known as "robbing Peter to pay Paul". 9 The applicant went into custody on 3 December 2003 in connection with convictions at Lismore Local Court on that date for offences of possessing a prohibited drug, unlawfully possessing a prescribed restricted substance and receiving property stolen outside New South Wales. The sentences imposed in the Local Court had attached to them a non parole period of four months making the applicant's date for release to parole scheduled as 2 April 2004. His Honour commenced the sentences which he imposed from that date for that reason. In submissions concerning totality of sentence, counsel referred to these offences as part of a course of offending but I am unable to detect a connection between them and the obtaining of money by deception which is elemental in the sixty five charges being dealt with in the District Court. 10 For the first group of twelve offences his Honour sentenced the applicant to concurrent imprisonment for a fixed term of two years for each offence commencing on 2 April 2004 and expiring on 1 April 2006. For the forty nine offences in the second group his Honour sentenced the applicant to concurrent terms of imprisonment for fixed terms of one year commencing on 2 April 2006 and expiring on 1 April 2007. For the final group of offences his Honour sentenced the applicant to concurrent terms consisting of a non parole period of eighteen months commencing on 2 April 2007 with a balance term of two years and six months commencing on 2 October 2008. As a consequence the first date of eligibility for parole of the applicant will be 1 October 2008. 11 As is apparent, in fixing the non parole period for the final group of offences, his Honour departed from the application of the formula for proportion which is specified in the sentencing statute. 12 The applicant was born on 2 April 1960. He followed a variety of occupations in his life, having been for some years an assistant to an entertainer who subjected persons to hypnosis and later conducting stage performances of that nature himself. At one time he married, but that relationship has not remained intact. He has a son. Prior to the offences his antecedent record consisted solely of an offence of driving with the prescribed concentration of alcohol. He gave evidence before the sentencing judge. He said that he had led a relatively abstemious life until making friends with a group of people who introduced him to a lifestyle which included extensive consumption of alcohol and drugs, in particular a drug commonly known as ecstasy. 13 The evidence before his Honour showed that the total amount obtained by the offenders as a result of their deceptions was over $2.6 million. There was no calculation before his Honour of the final deficiency. However, at the first instance hearing Phelan DCJ was informed that it was common ground that the property (at Ewingsdale) was sold for $1.35 million. There was no information about any expenses of sale but, on any view, the deficiency was well in excess of $1 million. It was plain from the facts that the co-offenders acted as a type of syndicate, dividing the benefits of their crimes in accordance with requirements from time to time. 14 The applicant relies upon three express grounds of appeal. Ground 1 asserts that the learned sentencing judge erred in his application of s 21A of the Crimes (Sentencing Procedure) Act 1999 and particularly in erroneously taking into account "aggravating factors" as set out in that section. 15 In his remarks his Honour said: "In considering the various matters in s 21A of the Crimes (Sentencing Procedure) Act I will deal firstly with the aggravating factors which include that he did have a record of previous conviction although there was no pronounced record. However, one has to take into account that he continued to offend even having made admissions about his earlier offences to the liquidator in 2001. At least a number of the matters were committed in company with others. There has been very substantial loss as a consequence in an amount which is very high indeed. I note too that there were multiple victims and that the prospect of them ever being compensated for the enormous losses is remote. I note that the offence was part of a planned or organized criminal activity and extended over a period of time". 16 Counsel for the applicant points out that these remarks clearly convey references to various scheduled aggravating factors set out in s 21A(2) of the statute. In a written submission on behalf of the Crown it was conceded that at first blush it would appear that his Honour has used the section as a type of checklist for consideration of aspects of sentencing. Closer examination confirms the impression at first blush. The Crown concedes that, if that is what his Honour has done, it was erroneous. This Court has frequently drawn attention to the error involved in using the section as a type of checklist. A particular danger is that a judge may overlook the need to discriminate between matters which are elements of the crimes charged and what may be truly aggravating factors. The difficulties are compounded when it is not clear exactly how matters referred to as being of aggravation have been taken into account. 17 A specific submission was made concerning his Honour's reference to multiple victims. This is a prescribed aggravating feature in s 21A(2)(m). The Crown concedes that it was erroneous for his Honour to consider that in the context of the offences, each of which was individually charged. For such an aggravating factor to be relevant, it needs to be attached to the particular offence under consideration and it is not open to a sentencing judge to use that circumstance as a factor of aggravation where the multiplicity arises in the context of offences, all of which are charged and the subject of individual convictions: R v Tadrosse [2005] NSWCCA 145. 18 A further particular complaint is made concerning his Honour's remark "an aggravating aspect of his conduct is that the offender, having admitted criminality to the liquidator shortly after continued his criminal activities". 19 This is a reference to the undisputed fact that, as some of the offences involved money passing into a corporation controlled by the applicant, it came to pass that a liquidator included interview of the applicant as part of his investigation. It was to this liquidator that the applicant confessed that in respect of a number of purported securities, they did not exist. Further offences were committed after this confession. 20 I do not understand his Honour to be using the expression "aggravating conduct" in the context of the statutory provision to which earlier reference has been made. I would understand his reference to be, if I may respectfully say, an oblique way of indicating that at that time, and by reason of his further offending, the applicant was showing no remorse or contrition for his offences. 21 Counsel for the applicant submitted that he was entitled to mitigation of sentence by reason of his disclosure of offences unknown to authorities in accordance with the authority of R v Ellis 1986 6 NSWLR 603. The liquidator, as he would obviously have been bound to do, enquired of the applicant where the securities in respect of which money had been obtained were to be found. In most cases, he confessed that the purported items did not exist. It was put that he chose not to lie and that is apparently so, but had he done so he would have exposed himself to punishment in a different category of misconduct. 22 It was said that the information received by the liquidator was conveyed to the corporate regulator which could itself institute prosecution but it did not. Prosecution followed the police investigation, the results of which are set out in the facts sheets prepared by Detective Kelly. 23 Whilst the confession to the liquidator may have provided a useful investigatory resource, the sequence of events is so far removed from the circumstances contemplated by Ellis that I would reject the submission. There is a considerable distinction between coming forward and disclosing otherwise unknown guilt of offence and, as here, confessing when called upon to proffer an explanation in the course of statutory investigation. 24 Nevertheless, to the extent that I have indicated, the argument in support of this ground is made out. 25 The second ground of appeal asserts that the learned trial judge erred in failing to give effect to the utilitarian discount attracted by the applicant's pleas of guilty, particularly on the last four counts. When his Honour came to sentence assessment, he said, "his guilty pleas attract the normal discount". He did not define what he meant by "normal" nor is that a description which, by reference to statute or authority, offers any precision. The applicant's contention that what he said was clearly a reference to what was outlined in R v Thomson and Houlton 2000 49 NSWLR 383 is correct. That case estimated discount for an early plea of guilty to lie in the range of between 10 and 25 percent. As indicated, the applicant pleaded guilty in the Local Court and he should be assessed as having made early plea. It is not mandatory, even in the case of early plea, for a judge to apply the upper end of the range of the discount just mentioned. The applicant points to the arithmetical fact that, against a prescribed maximum term of five years imprisonment, his Honour's assessment of four years imprisonment (prior to specifying a proportion as non parole period) must be a consequence of starting with a figure higher than five years if a discount of 25 percent were to be applied. The Crown submits that arithmetically what is involved is a discount of 20 percent as opposed to 25 percent. The applicant's submission does not come to terms with the circumstance that the applicant was not standing for sentence on a single count but in respect of the third group of four offences, each of which carried a maximum term of five years imprisonment. The Crown does not come to terms with the circumstance that the arithmetic which it has proffered assumes a discount against the maximum prescribed term which is reserved for offences which fall into the category of worst offence, or for offenders who fall into the category of worst offenders. His Honour made no finding to either of these effects. 26 It might be observed that the sentences for the offences in the third group were ordered to be served in all cases wholly concurrently. Although each offence was a manifestation of the same sort of criminal conduct, I do not accept the submission that they should be regarded as unitary criminality. Significantly there were marked temporal gaps between the four offences, the first being committed in December 2001, the second in July 2002, the third in October 2002 and the fourth either late that month or in the month following. 27 Having regard to the earlier matter discussed above however, there is compelling indication that his Honour's application is likely to have been tainted by some error. 28 The third ground is that his Honour erred in imposing sentences which failed to give effect to the proper application of principles of proportionality and totality. 29 Viewed as a matter of totality, the impositions upon the applicant amounted to imprisonment for seven years with a period of four years and six months to be served before eligibility for release to parole. 30 Counsel drew attention to sentence received by a co-offender, Galaxidis, particularly in regard to matters which in the applicant's case were in the third group. Argument that the applicant could harbour a justifiable sense of grievance by reason of disparity of sentence was expressly disavowed. This is not surprising as Galaxidis, inter alia, had indicated a preparedness to give evidence against other co-offenders and had made some independent arrangement to pay some money to a bank. The sentence received by Galaxidis is of no utility in examining sentence received by the applicant. 31 It was submitted that Phelan DCJ had not properly applied the principle of totality. An extract from the joint judgment (Gummow, Callinan and Heydon JJ) in Johnson v The Queen 2004 78 ALJR 616 was cited, viz: "We would with respect doubt that it is only in the case of an otherwise crushing burden of an aggregation of sentences that the totality principle may be applied." 32 That is accepted but the total sentence, reflecting as it does some sixty five offences, does not impress as failing to adhere to principle. It was orthodox for his Honour, having determined sentence for individual offences, to consider concurrency which he applied in the applicant's favour in respect of all offences within the groups and then the question of cumulation, bearing in mind the ultimate totality. The effective sentence was reached by cumulation of the concurrent terms for each group of offences. There is no principle which bound his Honour to only partially cumulate and the ultimate result does not constitute an excessive imposition. 33 His Honour made reference to details concerning the applicant subjectively. He noted his psychological assessment and matters pertinent to his background and deficiencies in educational achievement. 34 The report of Dr Roland, a clinical psychologist of Bangalow, was admitted without objection by the Crown. He did not report the administration of psychological tests. He did report history given by the applicant and to an extent by others. The applicant claimed to have attempted suicide on occasions apparently by overdose of drugs. Little detail is available. The applicant gave evidence on 18 December 2003 when he agreed that he had "struck up a rapport" with Dr Roland over "the last three months" which had been "of great benefit to me". 35 However, the applicant chose to engage in blatant fraud. The police investigation included the product of lawfully installed telephone intercepts, about which his Honour found, that they gave "very little hint or reflection of a person who is suffering chronic depression". That finding does not support the submission to this Court that there was error in failing to mitigate the sentences on account of the applicant's "mental illness". 36 It might be added that the intercepts portrayed a person who is enthusiastically participating in the fraudulent acquisition of huge sums of money. The transcripts of the telephone intercepts convey a picture of participants in a criminal enterprise enjoying a lifestyle to the extent that the proceeds enabled, a consciousness of their criminality and a need to take precautions against detection. 37 It is true that there may have been some restitution to the victims, particularly by way of sale of the property, but his Honour is not challenged on his finding that the prospect of the many victims "ever being compensated for their enormous loss is remote". 38 The intervention of this Court is expressly governed by s 6(3) of the Criminal Appeal Act 1912. It has recently been the subject of emphasis in these terms: "Sentencing appeals in this court frequently proceed as if the statutory trigger for the quashing of the sentence were expressed as follows: 'if it is of the opinion that error has occurred in the sentencing process'. That is not the statutory formulation. By s 6(3) this court must form a positive opinion that 'some other sentence ….is warranted in law and should have been passed.' Unless such an opinion is formed, the essential pre-condition for the exercise of the power to 'quash the sentence and pass such other sentence in substitution therefore' is not satisfied". R v Simpson 2001 53 NSWLR 704 @720-1. 39 In my view the enormity of what was involved in the applicant's crimes and his persistence in pursuit thereof over an extended period of time are particular factors which prevent any assessment of a lesser appropriate period than that represented by his Honour's ultimate total imposition. 40 I would grant leave to appeal but dismiss the appeal. 41 HALL J: I agree with Grove J

42 SMART AJ: The background is set out in the judgment of Grove J and in the lengthy and detailed statements of facts prepared by Det Snr Cons D Kelly. In summary the applicant pleaded guilty to 65 counts of obtaining money by deception extending over a five year period from September 1997 to November 2002. 43 The first group of offences involved the applicant between 10 September 1997 and 16 February 2001 on 12 separate occasions deceiving finance companies into lending large sums of money varying from $50,000 to $199,875. The goods were mainly non-existent. There were hire purchase agreements and lending agreements at least in some instances providing for the payment of periodic amounts. For a time so long as the payments were made this lessened the chances of the deceptions being uncovered. 44 Grove J has summarised the credit card frauds which involved 49 different offences involving $54,188. They extended from April 2002 to November 2002 and affected an appreciable number of people. 45 The third group of four offences involved large sums, namely, $60,000, $95,150, $1,156,927 and $190,300. These offences took place in December 2001, July 2002, October 2002 and late October-November 2002 and involved much dishonesty. 46 The total sum obtained by deception was $2,669,243. About $1.35 million less sale expenses was expected to be received from the sale of real property at Ewingsdale. It was also believed that some of the moneys obtained were used to repay earlier indebtedness. This sum does not seem to have been quantified. However, on any view there is a substantial deficiency. 47 No attack was made on the length of the sentences imposed on counts 1-12 in the first group, namely a fixed term of 2 years on each count to be served concurrently. Those sentences, and especially their concurrency contained a large measure of leniency. Nor was any attack mounted on the sentence of 1 year fixed term on each of counts 1-49 in the second group to be served concurrently. Those sentences and their concurrency were also lenient. In each instance, bearing in mind the criminality revealed, longer sentences would have been justified. 48 The applicant did attack the concurrent sentences comprising a non-parole period of 18 months with a balance of term of 2 years 6 months on each of counts 50-53 in the third group. The applicant complained that as the maximum penalty was 5 years for each offence and he had pleaded guilty and had some favourable subjective features this sentence was excessive. It must be remembered that there were four separate offences spread over nearly a year involving large sums. There is a substantial measure of leniency built into those sentences by reason of their being concurrent. No valid complaint can be made about such sentences. It would have been possible to structure those sentences differently by making one or more of them cumulative and shortening the sentences slightly, but that would be an idle exercise. 49 The applicant complained that in making each group of sentences cumulative the judge had not applied the principle of totality. I do not agree. As stated, the sentences on the offences in groups 1 and 2 were lenient and there was leniency in group 3 in making the sentences for the four serious offences concurrent. Further leniency by partial concurrency and partial cumulation was not warranted. When the sentences are taken together, and regard is had to the sentence imposed on 3 December 2003 with its non-parole period of 4 months, it cannot be said that the sentences in aggregate offended the principle of totality. 50 I have not overlooked the subjective features of the applicant and the difficulties he has experienced as recorded in the psychological report. The sentences imposed adequately allow for the applicant's subjective features. 51 Unfortunately, the applicant's criminality was of a high order. While the sentences require the applicant to spend a long period in gaol, this is the result of the extent of his criminality. Lesser sentences were not warranted in law. 52 I agree with the orders proposed by Grove J.

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