Regina v Leon Nikolaidis

District Court of NSW|2007-11-23|Before: Mr J

CITATION: Regina v Leon Nikolaidis [2007] NSWDC 246

DECISION: The offender is sentenced to a period of 2 years imprisonment to date from 23 November 2007 and to expire on 22 November 2009, with a non-parole period of 12 months imprisonment to date from 23 November 2007 and to expire on 22 November 2008.

CATCHWORDS: Make false instrument with the intention of using it to induce another person to accept the instrument as genuine - False costs agreement - Directed employee to prepare false document - Offender a Solicitor of the Supreme Court of New South Wales - Breach of trust - Degree of planning

LEGISLATION CITED: Crimes Act 1900 Crimes (Sentencing Procedure) Act 1999

R v Falzon & Pullen (CCA, unreported, 20.2.92) R v Pont (2001) 121 A Crim R 302 R v Smith [2000] NSWCCA 140 R v Marvin (CCA, unreported 1.11.95) R v Houlton [2000] NSWCCA 183 R v El-Rashid (CCA, unreported, 7.4.95) R v Woodman [2001] NSWCCA 310 R v Murtaza [2001] NSWCCA 336 R v Hovan [2005] NSWCCA 179 R v Vincent Cofini (unrep. NSW CCA 4 March, 1997) R v Sewell [2002] NSWCCA 7 Law Society of New South Wales v Carol Foreman (1994) 43 NSWLR 408 CASES CITED: R v Houlton [2000] NSWCCA 183 R v Kay [2004] NSWCCA 130 R v Todd [1982] 2 NSWLR 517 Mill v R (1988) 166 CLR 59 DPP v Hamman (CCA, unreported, 1.12.98) R v Phelan (1993) 66 A Crim R 446 R v Gentz [1999] NSWCCA 285 R v Houghton [2000] NSWCCA 62 R v Cappaddona & Anor (2001) 122 A Crim R 52 R v Allpass (1993) 72 A Crim R 561 R v Rivkin [2004] NSWCCA 7 R v Dinsdale (2000) 202 CLR 321 R v Zamagias [2002] NSWCCA 17

PARTIES: Regina Leon Nikolaidis

Crown: Mr K. McKay COUNSEL: Defence (Trial): Mr J. Conomos Defence (Sentence): Mr L.P. Robberds QC; Mr W. P. Lowe

SOLICITORS: Crown: Ms. J. Brown Defence: Mr. A. Carney

1 On 22 August 2007 the offender was found guilty by a jury on the following count pursuant to section 300(1) of the Crimes Act NSW: That Leon Nikolaidis between 31 October, 1996 and 17 February, 1998 at Sydney in the State of New South Wales did make false instrument, namely, a letter addressed to John Preston dated 19 April 1984, with the intention of using it, namely, to induce another person to accept the instrument as genuine and because of that acceptance to so do some act to the prejudice of John Preston.

The maximum penalty prescribed for that offence is one of 10 years imprisonment.

2 The matter has been listed for trial on three earlier occasions. On the first occasion the matter did not proceed as the Crown was given leave to issue further subpoenas. During the early part of the second trial the jury was discharged because one of the jurors became ill during the jury's deliberations. A third trial took place in February 2006. The jury retired to consider its verdict but was unable to agree and was discharged.

3 The crucial issues in the trial were whether the document, said to be a copy of a costs agreement/retainer letter setting out the terms of the agreement between the offender and his client, Mr John Preston, was false and, if so, the intent with which the document had been prepared.

4 Evidence in the trial was called by the Crown from the offender's then secretary, Ms Jan Moffatt. She said she prepared the contents of the letter in accordance with a tape dictated by the offender. She did so in accordance with his instructions to prepare the letter on an old letterhead of the offender's firm and on green copy paper which he provided to her.

5 Neither the old letterhead nor the green copy paper were utilised by the firm at the time the instructions were given to Ms Moffatt. At that time, all letterheads were computer generated and computer copies were generated as part of the preparation of the original letter.

6 Ms Moffatt gave evidence as to when the letter was typed by her (namely the period specified in the indictment rather than 1984 as set out on the copy letter) as well as the conversations between her and the offender. At or about the time of his instructions to her he made reference to the fact that there had been a costs dispute between him and Mr Preston and Mr Preston's associated companies.

7 Evidence was also given by Mr Preston as to his course of dealings with the offender from 1984. At that stage Mr Preston had had a dispute with his previous solicitors, Messrs Strong Brown. They had charged him at the rate of $75 per hour. Mr Preston said that, at the time of his initial consultation with Mr Nikolaidis, Mr Nikolaidis said that he was proposing to charge Mr Preston at the rate of $85 per hour.

8 Evidence was given that the hourly rate under the scale costs in accordance with the then applicable Supreme Court scale was at the rate of $59 per hour.

9 Mr Preston also gave evidence that a large number of bills of costs were rendered by the offender to Mr Preston and his companies at varying hourly rates over the period 1984 - 1990. Many of those bills were exhibited during the trial showing a variety of hourly rates.

10 Ultimately the relationship between Mr Preston and the offender soured. On 8 October 1992, the offender had sent Mr Preston and his associated companies a summary of accounts (for some but not all matters) indicating that there was approximately $34,000 owing. The offender gave evidence that that summary was only in relation to the accounts specified in that summary.

11 Mr Preston terminated the professional arrangement with the offender and his firm on 12 October 1992. Mr Preston demanded back his files so that he could instruct other solicitors. The offender resisted that request, specifying that the files would be returned on payment of his outstanding fees of $95,000 (T374 lines 32-49). Mr Preston said the offender said to him 'if you want your files you owe me $95,000.' (T601 line 46). Mr Zwar, a then employed partner of the offender, proposed that that sum be paid into court after the proceedings had been ongoing.

12 On 16 October, 1992, after the termination of the retainer, the offender sent Mr Preston a further summary of accounts owing showing that $95,000 was owing by Mr Preston and his companies. The offender gave evidence that that summary was a total of what was owing including work in progress. That summary was prepared as part of the exercise of closing all the files pursuant to the termination of the relationship.

13 That termination led to civil proceedings in the Supreme Court during which a costs assessor was appointed, namely, a senior solicitor Mr Hattersley.

14 Mr Hattersley corresponded with the offender's firm, mainly with Mr Zwar. Mr Zwar said that he had been pressing for Mr Hattersley to attend and inspect the files so the matter could be resolved. It was arranged that Mr Hattersley would come to the offender's firm and inspect all the files relating to Mr Preston and his associated companies. Mr Zwar informed the offender of that impending visit.

15 The Preston and related files were located in a back room of the offender's firm and made available to Mr Hattersley. On the top of the table in that room were a number of files, in particular a file relating to the dispute between Mr Preston and Citicorp. On that file, in the correspondence section, was the copy letter of 19 April, 1984.

16 Mr Zwar said that, when he saw that document on the file prior to the arrival of Mr Hattersley, he immediately brought it to the attention of the offender. Mr Zwar recalled that he immediately realised the significance of the letter. One reason why he recalled that was because he was very concerned, and indeed angry, about the late discovery of that letter as he had previously costed the other Preston matters. He said it would have made his task much easier had he been aware of the letter's existence.

17 When Mr Zwar raised that with the offender his evidence was that the offender said "I always thought there was an agreement of that nature. I thought it was on the Strong Brown file".

18 Mr Zwar left the file for Mr Hattersley to inspect with all the other Preston files. There were about 60 or 70 such matters and some hundreds of associated files in the room to be inspected by Mr Hattersley.

19 Mr Zwar said in his evidence that, having realised the significance of the document, he made a private bet with himself as to how long it would take for Mr Hattersley to find the document and raise it. In the event, Mr Hattersley inspected the files and located the letter very quickly. He copied it and brought it to Mr Zwar's attention.

20 Mr Hattersley then wrote to both the offender and Mr Preston's new solicitor's raising the agreement and asking for their submissions on it and the effect of it. Mr Preston immediately denied ever seeing the letter or being aware of its existence. His new solicitors (Wheelers) wrote to Mr Hattersley indicating those instructions on 10 March, 1998. Mr Hattersley's practice was to pass on all such correspondence to those involved.

21 Mr Preston was a very determined and experienced litigator and, before and during the period he was a client of the offender, he had been involved in proceedings against receivers, banks and other solicitors. He had come to the offender's firm having had a dispute with at least one other firm.

22 Mr Preston's evidence admitted of no ambiguity in terms of his feelings towards the offender and his motivations for continuing the proceedings. It was clear from the evidence and from the demeanour of both the offender and Mr Preston that there was considerable antipathy between them by the end of their relationship. Mr Preston volunteered in his evidence in chief that: "if you put it plainly we hated each others' guts" - (T 13/8/07 at p602).

23 He also confirmed that in the opening parts of his cross-examination (T 13/8/07 at p623): Q. Mr Preston, you told this jury when you volunteered it to the Crown that you hate the offender's guts and he hates your guts. They were your words, weren't they? A. Yes.

24 Mr Preston had paid the offender a substantial level of fees - approximately $1.2 million in costs and disbursements in the period in which the offender had been acting for him. The evidence was that the total fees would have been of the order of $1.3 million. The disputed amount of fees of $95,000 was the matter in issue.

25 The offender gave evidence that the level of disbursements of the total fees was of the order of 50%. How much of that was for actual disbursements paid to other persons such as counsel or how much were for the offender's own firm's disbursements such as photocopying and other administrative costs is unclear.

26 The Supreme Court civil proceedings between Mr Preston and his companies and Mr Nikolaidis in relation to the lien/costs argument was deferred while the status of the letter was investigated and the implications of it were examined. Ultimately those proceedings were adjourned pending the trial of the charge against the offender.

27 Mr Preston then asked to see and inspect the document, as part of the Supreme Court proceedings.

28 The offender engaged Mr Paul Westwood, a forensic document examiner, to examine the document before it was released by him. Mr Westwood carried out an ESDA (electrostatic detection apparatus) test in 1999.

29 Mr Westwood determined that there were various markings on the document which could have been from the imposition of other documents on top of the copy document on the Citicorp file. Mr Westwood suggested that the offender provide other documents to assist in identifying the age of the document.

30 The offender did not provide such additional documentation to Mr Westwood pursuant to or following Mr Westwood's suggestion.

31 The solicitors for Mr Preston and his companies then instructed another document examiner, Ms Roslyn Winter, then in the employ of Mr Chris Anderson, another forensic documents examiner. She carried out another EDSA examination but was unable to find the same degree of detail in markings - although she established that there were some markings on the documents.

32 Further forensic examination at later stages indicated that there were no recoverable fingerprint markings on the document which could be used either for verification or exclusion of any person.

33 At issue then was who had prepared the document. The document bore the initials 'LN' (Leon Nikolaidis) and in lower case, the initials 'SMB'. It clearly referred to Ms Sybil Burden who was employed at the offender's firm in late 1983 or early 1984.

34 Ms Burden gave evidence to say that she could not recall typing the document. The copy letter had errors in it including the use of the symbol for ampersand (@) and other symbols used in the place where the postcode would normally have been. There was also a clear spelling error in the early part of the text of the letter.

35 Crucially, Ms Burden gave evidence that, had those errors existed, she would have altered them either by white-ing them out or rubbing them out with a rubber attached to a pencil. That did not occur, and had not occurred, in this instance.

36 Ms Middleton gave evidence that in 1998 she was a salaried partner with the offender's firm. In November 1998 she was approached by Ms Moffatt who had tears in her eyes and who was clearly distressed about a matter. Ms Middleton said (T 13/8/07 at page 291): Jan came into my office and shut the door, sat down, and she had tears in her eyes and I said to her "What's wrong with you?" And she said to me, "What would happen to me if I was told to create a document and backdate it?" And I said to her, "Well, you're not going to do it", and she said, "Well, what if I have done it?" And I said - "Well what would happen to me" is what she said to me and I said, "Well, you wouldn't - the person who told you to do it would be the one who would in trouble."

37 Mr Nikolaidis gave evidence at the trial and denied that he had dictated the letter to Ms Moffatt in the period in the indictment. He maintained throughout the trial and in his earlier evidence and in the Supreme Court proceedings that the letter was genuine. Although he could not recall the letter being prepared, he said that it would have been prepared by him as part of the normal initial confirmatory discussions with the client setting out the hourly rate.

38 The offender also gave evidence that Ms Moffatt had made demands on him with the strong inference that these were made by way of an attempt at blackmail by her. Ms Moffatt strongly disputed those suggestions.

40 Evidence was also given by the offender's mother, Mrs Nikolaidis, who was an office manager at the offender's firm at the relevant period.

41 Evidence was also given by another employee, Mr Vangaropoulos (who subsequently came to be known by the name of Garrop).

42 Mr Garrop gave evidence of a conversation with Ms Moffatt whereby it was said that Ms Moffitt was threatening to use the fact of what had occurred in what was essentially, or at least, inferentially, a blackmail scenario of the offender.

43 The Crown relied on the direct evidence of Ms Moffatt and that of Mr Preston as well as on the following facts as part of the circumstantial case:

a) The offender's firm filed documents in the Supreme Court as part of the costs dispute to the effect that there was no costs agreement; b) The letter existed as a copy letter dated 1984; c) The letter was not recorded in the mail book maintained by the offender's firm at the relevant time. Other material had been sent to the Mr Preston's home at about that time and was recorded; d) The letter set out an hourly rate to be charged in relation to the costing of Mr Preston's matter by the offender; e) There was a costs assessment process involving a court appointed costs assessor, Mr Hattersley; f) That costs assessment process had been ordered as a result of the dispute between the offender's firm and Mr Preston; g) The letter only came to light after the costs dispute and the action taken by Mr Preston to recover his files; h) Mr Preston was unlikely to get an order for his files to be returned to him until that costs assessment had been finalised; i) Mr Hattersley had made his requests to come to the firm in November, 1997 as part of that process of assessment; j) Mr Hattersley sent two letters in 30 May 1997 (exhibit 2) addressed to the offender's firm pointing out that to sustain an hourly rate of $200 per hour the firm needed to rely on a specific written agreement as to costs; k) Responses to Mr Hattersley in 1997 did not include any references to the copy retainer said to be dated 19 April 1984; l) The evidence of Mr Zwar, a then partner of the offender, was that he had obtained, or had seen, a copy of this letter in a file at about the time of the assessment. The letter had not been supplied to or available to Mr Zwar during all the earlier periods when he had been drawing up bills for the offender; m) The letter came to light when Mr Hattersley came to examine the files in the offender's office in late January/early February, 1998; n) The letter was on the Citicorp file on the table in the room to which Mr Hattersley was taken to inspect the files; o) The letter was placed in such a position on the file that it would have taken Mr Hattersley a very short period to discover the letter, to realise its significance and to photocopy it and then to bring it to the parties' attention; p) The offender's firm urged Mr Hattersley to act on the information he had found including the terms of the letter; q) It was clear that Mr Hattersley would use the letter as part of the process of his assessment; r) In the proceedings in the Supreme Court the offender admitted that up until 3 May, 2001 he was relying on the fees and charges set out in the letter of 19 April, 1984 to determine the terms of the retainer.

44 The Crown relied on the following matters to support the inference of falsity of the letter: a) The fact that the letter was said to be sent to Mr Preston's home address rather than his work address; b) When other letters recorded in the mail book were sent to Mr Preston's business; c) The letter was dated at a date near to the commencement of the business relationship with Mr Preston; d) The letter contained references as though it had been prepared by a secretary, Ms Burden; e) Ms Burden had left the firm; f) Her initials were on the letter when other correspondence closer to that time did not have those initials; g) The marks on the letter came from a type-face that was not available through the supplier, Canon, until 1987.

45 The Crown relied on the following matters to support the inference that the letter was executed with the intent that it be used for the purposes set out in the indictment:

a) The copy document was executed as a 1984 letter on a letterhead and green copy format which was in use at that time; b) That was the time when the offender commenced acting for Mr Preston; c) With the initials of a secretary Ms Burden whose initials were on other relevant correspondence executed at that time and when Ms Burden had left the firm; d) When the letter was placed in the Preston/Citicorp file to which Mr Hattersley was going to be directed; e) That file being located where it was at that time, namely where it would be looked at by Mr Hattersley; f) When it would influence him; g) To make a costs assessment; h) Based on the hourly rate figure included in the letter; i) That the letter might make Mr Preston personally liable for costs.

46 The Crown also relied on other matters concerning the charge out rates used as part of the overall circumstantial case to establish the falsity of the document and the intent with which it had been made including:

a) That the hourly rate specified was very different from the other hourly rates set out in earlier correspondence and other rates applied by the offender in rendering bills; b) The Supreme Court scale of 1984 was $59.10 per hour for a solicitor and for those with a higher degree of skill $86 per hour. During the period 1984 to 1992 the offender rendered bills which went from about $85 or $95 an hour in 1984/85 to about $200 per hour in 1992; c) In his affidavit of 23 June 2001 the offender admitted that in 1987 he charged Mr Preston at the rate of $100-110 an hour. As at May 1988 his charge out rate was $110 per hour and that increased in December 1988 to $125 per hour. Mr Zwar had prepared documentation on the instructions of the offender in relation to the Supreme Court claim involving Mr Preston in November 1996. That included in exhibit 7 a statement "that there is no costs agreement between myself and the client"; d) The only other document said to be a costs agreement was the confirmation of retainer document in 1992 for the 'Down to Earth Spring Water Pty Ltd' matter.

a) The fact that there were defects in the typeface used on the letter (for example, the letter 'N') which were not apparent in other letters in existence at that time; b) The fact that the document examiners established that while the typestyle was consistent with four versions published in 1981, 1985, and two in 1987. Mr Westwood discounted all bar the 1987 document. c) Mr Anderson examined the typewriters which could have typed the particular letter. d) The typestyle did not match the typestyle of any of the letters from the offender's firm around the period of 1984;

47 The defence drew the jury's attention to a number of circumstances which it was submitted were totally consistent with the defence case that the document was genuine or which supported the fact that there were other matters inconsistent with the case raised by the Crown:

a) That the document bore the date that it did which was shortly after the offender started acting for Mr Preston; b) That the offender was having discussions about costs throughout that period; c) That there were charge-out rates consistent with the offender's rates.

Those submissions were clearly not accepted by the jury.

48 A pre-sentence report (exhibit S1) was prepared by Grant Farquarson of the City Office of the Probation and Parole Service. It was dated 14 November 2007.

49 It is clear from the report that the offender is aged 52, his date of birth being 5 June 1955. He was married in 1978 and has two children. He was admitted as a legal practitioner in 1975 and became a partner in his father's law firm in 1984.

50 The report states that Mr Nikolaidis maintains his innocence although he has said that the legal process which has brought him to this position has been appropriate.

51 The offender did not give evidence on the sentencing proceedings.

a) Mr Peter Matthews who had known the offender for 39 years at school and at university;

b) Mr David Sampson, a Director of the insolvency firm Armstrong Wiley. He had known the offender in a number of insolvency and bankruptcy matters and had had weekly contact with him;

c) Mr Phillip Hosking, also from Armstrong Wiley, who had known the offender for 35 years, as well as professionally;

d) Mr Dennis Grant, a solicitor and former employee of the offender's firm. He had known him in a variety of professional capacities over the last 12 to 13 years;

e) Mr John Carter, Managing Director of Orix Australia, a large client of the offender's firm. He had known the offender for 18 years;

f) Mr Tim Hales SC, who had known the offender for 15 years professionally.

53 All these character witnesses spoke of the offender's professional approach to his work and to clients in particular, his attention to detail, and the standards he had pursued in his professional practice which was consistent with their respective observations of him on a social and personal level.

54 All had been informed of the charge and the jury's verdict and were at a loss to explain the offender's departure from the standards they had each, and all, observed. Mr Hales SC said that he had noticed that when he attempted to encourage the offender to concentrate on his own matter, that is, the subject matter of this litigation, Mr Nikolaidis seemed unable to concentrate or give the attention to detail that was always apparent in his professional activities.

55 The Crown filed written submissions on 19 September, 2007. The Defence filed written submissions on 16 November, 2007.

56 Consistently with the jury's verdict I find that:

a) that the letter was prepared by Ms Moffatt in accordance with the instructions she had been given by the offender both as to content and format; b) that the instructions for the letter by the offender to Ms Moffatt were given when he was aware of, and in the context of, the dispute over costs with Mr Preston; c) the document was false both as to the date it was said to be issued and as to its content; d) that it was made by the offender with the intent of inducing the costs assessor, Mr Hattersley, to accept it as genuine; and e) with the intent that the assessor would do some act, issuing a costs assessment; f) an assessment made on that basis would have been to the prejudice of John Preston. That prejudice would have been the issuing of a costs assessment in accordance with the charge out rate of $150 per hour, as specified in the copy letter; g) that the offender was aware that the issue of costs and his entitlement to a charge out rate was to be the subject of examination by the costs assessor, Mr Hattersley; h) that the letter was placed on the Citicorp file by the offender with the expectation and intent that it be discovered by Mr Hattersley; i) that Mr Hattersley would utilise the hourly charge out rate in his costs assessment process; j) That the use of that rate would have led to an assessment at a higher figure than would otherwise have been the case had the assessment been at the then applicable Supreme Court scale.

57 Against the background of the matters set out above, I am satisfied that what was involved was:

a) a direction by the offender to a trusted employee to prepare a false document; b) with the intention that that letter would be discovered; c) further, that when the letter was discovered and brought to his attention by Mr Zwar the offender permitted the use of the letter as a genuine copy costs letter to continue; d) knowing that it was likely that the use of the letter would have the effect of inducing a court appointed costs assessor; e) to issue a costs assessment at a higher rate than would otherwise have been the case; f) and that that assessment, issued on the premise of that false document, would have been to the prejudice of John Preston.

58 Those actions represent a serious attempt to subvert the Supreme Court costs assessment process. The actions taken were designed to effectively mislead a person who was to exercise responsibilities leading to a determination and recommendation which would be given effect to by orders of the Supreme Court. The letter which was falsely executed by the offender was one of the foundation documents on which the assessor would rely which would ultimately end up in an assessment which would have the effect of court orders.

59 Moreover, and importantly, the act was that carried out deliberately by a solicitor who was and is an officer of the Court whose processes were being affected.

60 The attempt was also in relation to disputed fees of the order of $95,000. What would actually have been owing to the offender is unclear but in any event it was a substantial amount of money. It is also unclear whether that amount would have been recoverable or used for some other purpose, for example, in negotiations as to costs with Mr Preston.

61 It was an arrangement which involved considerable planning by the offender and getting his employees to do his work for him. What was involved was an employer directing an employee to be involved in an act of clear falsity. The offender directed his trusted, valued and long-term employee, Ms Moffatt, to prepare the false document in accordance with his very specific instructions. She was vulnerable to that pressure in that she was economically dependent on the offender for the maintenance of her position.

62 That pressure on Ms Moffatt, led to considerable distress for her. Her clear anxiety about her own position - which was evident in her evidence in the trial - was as to her own potential exposure to criminal proceedings. It was that anxiety which clearly led her to have the tearful discussion she did with Ms Middleton.

63 Employees should not be placed in that position. That is a separate aspect of the criminality of this matter which must be taken into account in assessing the appropriate sentence.

64 An essential part of the offender's case which was evident in the instructions he obviously gave to cross-examine Ms Moffatt, was that she was motivated by greed to effectively blackmail the offender. Ms Moffatt strenuously denied that suggestion.

66 Further, the activity involved a partner/employee, Mr Zwar, as an unwitting participant in the process of providing the false document to Mr Hattersley.

Length of time and other circumstances during which the deception continued

67 It was submitted by Mr Robberds QC on behalf of the offender that what was involved was a single act of criminality, a stupid, isolated act which would inevitably be discovered.

68 I do not accept that submission. While the act of giving the instructions to Ms Moffatt was a single act, it was followed by the act of placing the letter on another file with the clear intention that it would be discovered by Mr Zwar and brought to the attention of Mr Hattersley. He let them continue on with that belief as was evident in the subsequent discussions and correspondence.

69 What was also involved thereafter was a long course of conduct whereby the offender implicitly denied to both the Supreme Court (in the civil litigation) and the District Court (in a number of trials) any suggestion that the document was made falsely. The circumstances outlined above make clear the context in which the act of falsity took place and the planning which occurred. The offender continues to maintain his innocence.

70 Against that background I am satisfied that the level of criminality displayed is of the order of mid-range seriousness and gravity.

71 This offence was clearly planned and premeditated.

72 Mr Robberds QC submitted that it was a single, stupid act which would have inevitably been detected - given Mr Preston's personality and ongoing conduct of the matter, I do not regard that submission as correct nor as being consistent with the degree of planning involved and the involvement by the offender of others.

74 He has been a solicitor of the Supreme Court since 1983.

75 The character evidence has already been referred to.

76 The offender still denies the offence. In those circumstances it is conceded that there is no evidence of remorse. Although there was one act of criminality, the offender persisted with his behaviour and reliance on the document over a long period of time in the face of clear evidence that there was to be a dispute over the validity of the document and what it represented.

77 In the absence of any remorse, there is nothing that I can see which would indicate any recognition by the offender of any wrong doing as a precursor for rehabilitation.

78 There are a number of authorities in relation to offences of this nature concerning persons who make false instruments in the course of their employment or in the position of trust.

79 The principles emerging from those authorities include the following:

80 White collar crimes involving breaches of trust by professional people "are at or near the top" of the scale: R v Falzon & Pullen (CCA, unreported, 20.2.92). Those placed in a special position of trust by the law and the community, such as solicitors, accountants or company directors, who abuse that trust by dishonesty, call their profession into question and merit sentences calculated to ensure that other professional persons will be left in no doubt as to the serious consequences that will follow: R v Pont (2001) 121 A Crim R 302 at [46-55]; R v Smith [2000] NSWCCA 140.

81 The principles apply to professionals because the breach of trust abuses the special status they have and affects public confidence in all of their colleagues. Their crime undermines the institution of which they are members: R v Pont (2001) 121 A Crim R 302 at [55].

82 Many of the offences involving solicitors involve misappropriation. Those principles are set out in, amongst others, R v Marvin (CCA, unreported 1.11.95); R v Houlton [2000] NSWCCA 183 at [25].

83 However, it needs to be emphasised that this is not such an offence and there is no evidence that the offender took monies which belonged to the client, Mr Preston. While this offence is not one of misappropriation, it did involve a member of the legal profession utilising his knowledge of the system involving a Supreme Court costs assessment process and the documents on which the costs assessor was to rely.

84 In relation to offences committed by legal practitioners Sully J in the decision of Marvin v R (unrep CCA 1/11/95) stated :- "Public respect for and public trust and confidence in the rule of law are the very lifeblood of the rule of law. Underpinning the rule of law, among other things, is reputable professional practice as a barrister or solicitor. Public respect for, public trust and confidence in the essential integrity of such professional practise by those who are admitted to practise as barristers or solicitors is also, in my view, the very lifeblood of the rule of law."

85 What was involved here also involved a betrayal of public trust and confidence. What is also apposite is that the client and the public - and the Supreme Court through its assessor - is entitled to rely on the honesty of a solicitor in putting forward documentation on which all could rely.

86 As was said in R v Smith [2000] NSWCCA 140 at [15-18] (albeit in the context of a bogus investment case): "Solicitors are persons placed in a special position of trust by the law and the community, and that their position is one which in the eyes of the community requires persons of the greatest integrity; that members of the community put their trust in the honesty of solicitors, and it is because that is so that the profession of solicitor is a large one and one which provides high financial rewards. When that trust is abused by the commission of fraud in any form, not only does the client or person the subject of the fraud suffer, but the integrity of the profession is necessarily called into question and the courts must impose sentences which are calculated to ensure that no solicitor will be left in doubt as to the serious consequences that will follow from such conduct ... This is particularly the type of case in which the court is entitled to express, on behalf of the community, its disapproval of the particular type of breach of trust involved".

87 In that case, the solicitor received clients' funds for bogus investments. He collected almost $3 million in 20 months. He was sentenced to 3 years minimum term with 2 years additional term, which was increased to 4½ years minimum term, 2 years additional term.

88 Considerations of general deterrence are of particular importance in sentencing for white collar crimes. These crimes frequently involve a serious breach of trust and are usually only able to be committed because of the previous good character of the person who has been placed in a position of trust: R v El-Rashid (CCA, unreported, 7.4.95) per Gleeson CJ.

89 In considering these authorities, the different kinds of offences and relevant sections under which the charges are brought need to be borne in mind. However, the relevant matters to be considered in determining the gravity of the particular offence include:

The amount of money defrauded;
The length of time over which the dishonest conduct continued;
The degree of sophistication or planning involved;
The abuse of trust;
The amount of restitution;
The impact on the victim; and
The impact on the public and public confidence:

90 Against those criteria, the following matters are relevant in this instance:

91 Here no actual money was defrauded. However, the offender's intentions were clear and that was to advance the proposition that he was entitled to raise a claim in the sum of $95,000 in costs before his lien on Mr Preston's documents would be released.

The length of time over which the dishonest conduct continued

92 The letter was made falsely in the period specified in the indictment. However, the reliance on the document was effectively from the time of its discovery by the costs assessor (which was almost immediately brought to the offender's partner by Mr Zwar and then to the offender) until the trial.

93 Throughout that period and subsequently, the offender maintained his position based on the veracity of the document. He instructed experts to examine the document to ascertain or confirm its authenticity putting others involved in both the civil and criminal proceedings to considerable expense.

94 The length of time demonstrates a degree of planning and deliberation inconsistent with an impulsive offence: R v Woodman [2001] NSWCCA 310 at [29]; see also R v Pont (2001) 121 A Crim R 302 at [44-74] where a number of cases are reviewed.

95 Here it was submitted that what was involved was an act which did not involve a breach of the solicitor/client relationship as that relationship had ceased. While that may be technically correct, what was involved was a clear breach of the offender's obligations as a solicitor to ensure his dispute with his former client was resolved honestly and on a legitimate basis. He also had a clear obligation of honesty and integrity in his dealings with the costs assessor who he knew was an integral part of the Supreme Court costs assessment process. As a senior practitioner and experienced litigation solicitor, he must have known that the function of the costs assessor would be to make a report and recommendations to the Court which were capable of being translated into costs orders having financial consequences for the parties.

96 The combination of factors that ordinarily require "substantial sentences of imprisonment" are breach of trust, involving substantial sums of money and involving systematic dishonesty attended by planning and some sophistication. The key features of aggravation are said to be breach of trust, planning and repetition: R v Pont (2001) 121 A Crim R 302 at [43-44]. In Pont there is an extensive survey of the authorities from various jurisdictions on sentencing for white collar crime at [37-76].

97 Likewise, in R v Murtaza NSWCCA 336 at [15] it was said that the important factors in assessing the criminality were "the fact that there was a breach of trust, planning and that the conduct extended over a lengthy period": In that case, Murtaza stole $80,000 worth of equipment from his employer over 16 months. He was sentenced to a 3 year bond, which was later increased to 6 months imprisonment.

98 That the offence involved abuse of a position of trust, a series of criminal acts, or that it was part of planned or organised criminal activity are aggravating factors to be taken into account under s 21A(2)(k), (m) and (n) of the Crimes (Sentencing Procedure) Act 1999.

99 Here there was no restitution as there was no money actually defrauded. Presumably there would have been costs incurred to Mr Preston and the Law Society in the investigation and pursuit of the matter. However, those are costs relevant to other proceedings and are of no direct relevance in these proceedings.

100 The parties involved (particularly Mr Preston) are not strictly 'victims' in the sense that that description is given to those directly affected by acts of dishonesty, nor do I regard their circumstances as bringing them within the classification to be considered as aggravating factors within section 21A of the Crimes (Sentencing Procedure) Act.

101 Mr Preston has had to continue his involvement in the proceedings including giving evidence. Probably more importantly to him, he has had to experience the delays and frustration in the recovery of his files. Ms Moffatt has also had to attend and give evidence on a number of occasions and to give evidence against a former employer with whom she had a long association prior to her resignation. Mr Hattersley has also had to give evidence and there have been substantial delays to the civil proceedings.

102 I regard this factor as a matter of considerable importance. What was involved was an attempt to subvert the costs assessment process where a court appointed official was entitled to rely on the veracity of the documents with which he had been provided by a senior and experienced practitioner.

103 The courts have consistently emphasised the position of solicitors as officers of the court having a vital and integral part in the administration of the justice system. The community expects that such persons have a higher responsibility in ensuring the veracity of what they assert, particularly where such documents are to be relied on by others.

104 There can be no doubt that the offender was aware of what was going on and the importance of his allegations in the context of the Supreme Court costs dispute. His attempts in making this letter in the circumstances he did were deliberate and carefully planned and required his professional knowledge of the system.

105 All these authorities need to be considered in the light of the different provisions under which the respective prosecutions have been brought, the different kinds of criminality involved and the different facts of the offences and personal circumstances of the offenders involved. However, against that background, some relevant sentencing issues are raised.

106 In R v Hovan [2005] NSWCCA 179 the Court of Criminal Appeal was concerned with a solicitor aged 49 with no prior convictions who had been in practice for 20 years. He was convicted of one count under section 300(1) for which he was sentenced to a full term of 12 months and two counts under section 300(2) for which he was sentenced to concurrent terms of 3 and a half years with a non-parole period of 2 and a half years.

107 That offender had entered pleas of guilty and expressed remorse. He was on bail in relation to the first matter when he committed the latter two offences.

108 On appeal, the sentences were varied to a fixed term of imprisonment for six months for count one, and imprisonment for two and a half years with a non-parole period of twelve months for counts two and three.

109 In R v Vincent Cofini (unrep. NSW CCA 4 March, 1997), the offender had pleaded guilty to three counts of using a false instrument under section 300(2) of the Crimes Act. There were a further six similar offences on a Form 1. An appeal from a sentence of two years imprisonment with a minimum term of one year was dismissed and described, per Hidden J (Gleeson CJ and Hunt CJ at CL agreeing) as lenient.

110 The facts involved the use of a name on security documents where the person named did not exist, a fact known to the offender. The offender had been struck off, his remorse was genuine.

111 R v Sewell [2002] NSWCCA 7 - Plea of guilty - 7 x s300(2) - 4 years, non-parole period of 1 year and 5 months. The offender induced Westpac Bank to accept false instruments as genuine and thereby credit to appellant's account money to the prejudice of appellant's employer.

Law Society of New South Wales v Carol Foreman (1994) 43 NSWLR 408 -

112 That decision concerned civil proceedings taken through the disciplinary tribunal structure rather than criminal proceedings.

113 Ms Foreman, the solicitor concerned, altered an internal time sheet to show (falsely) that a costs agreement had been provided to the client. The false time sheet was included in an affidavit of discovery and produced to legal practitioners and the Family Court. An admission and confession was made only when the solicitor was confronted with the evidence.

114 The solicitor's deception was compounded in that it came to involve employees of the solicitor's firm. It was extended to her partners. It involved counsel appearing for the firm and other advisers. Most seriously, by a second re-writing of the time sheets, to be produced on discovery in what was by then a litigated contest between the firm and Ms Weiss, the deception was extended to Ms Weiss and her new legal representatives. Most importantly of all, it was extended, uncorrected, to the Family Court of Australia by the action of a further copy of the re-written time sheet. This pretended to be genuine. It was produced at considerable pains to make it appear genuine. It was put forward to practitioners, opponents and the Family Court as genuine. Ms Foreman knew that it was false and eventually confessed her part in the discreditable conduct charged.

116 Ms Foreman was found guilty of professional misconduct and unsatisfactory professional conduct. She was fined $20,000 and it was ordered that her name be removed from the roll of practising solicitors.

117 Also considered (relevantly) in that case was: o Public interest in use of the solicitor's skills; o Past professional service; o Evidence of professional opinion; o the public shame and humiliation; o the context of pressure

all of which are also relevant here and I take those matters into account. o Acknowledgment of wrongdoing - a factor which is not present with Mr Nikolaidis.

118 A long period of delay in having the matter finalised, whatever the cause, is a matter to be taken into account. The passage of time since the commission of the offences will often lead to the current situation of the prisoner becoming the dominant consideration and may result in an undue degree of leniency being extended where the prisoner has achieved significant rehabilitation: R v Houlton [2000] NSWCCA 183 at [23], [41-2]. The solicitor misappropriated $347,000 in trust money over 3 years. Five year delay. Sentenced to 3 years periodic detention and a bond.

119 In R v Kay [2004] NSWCCA 130 the Court of Criminal Appeal considered the impact of delay and the High Court decisions in R v Todd [1982] 2 NSWLR 517 at 519 and Mill v R (1988) 166 CLR 59 at 66. McColl JA at [28] distinguished those cases on the basis that, in those cases, the relevant delays were due to the operation of the criminal justice system whereas in Kay the accused during the relevant period concealed his involvement in the offences and couldn't be heard to complain of delay.

120 The delays here have resulted, in part, because the accused wished to have the crucial document tested and, in part, because of the earlier trials. There do not seem to have been any undue delays by either the police or the prosecution with the matter coming to trial. This was not a 'stale' crime. Moreover, the accused has had the benefit of the delays in maintain his practice - which has obviously been a substantial practice which supported up to 10 employees.

121 The relevance of the delay means that the offender is, and has been, left in a position of uncertainty. This is a matter to be taken into account: DPP v Hamman (CCA, unreported, 1.12.98) -where there was 2 year delay before charges were laid. See also R v Phelan (1993) 66 A Crim R 446 where the period of delay was not specified but was said to be "considerable".

122 Regardless of the cause of the delay in this case, even simply from the viewpoint of common humanity the delays which have occurred here - and in particular the earlier trials - would have imposed considerable stresses on the accused and his family which I take into account.

123 Prior good character and the absence of prior convictions are mitigating factors to be taken into account under 21A(3)(e) and (f) of the Crimes (Sentencing Procedure) Act 1999. I have taken into account the character evidence given.

124 In fraud cases the courts have taken the attitude that it is because of prior good character that offenders are appointed to positions of trust, and when they abuse that trust the question of general deterrence becomes a major consideration: R v Gentz [1999] NSWCCA 285 at [12].

125 Prior good character is of less weight in cases of repeated offences over a period of time than it is when the offence is an isolated one: R v Phelan (1993) 66 A Crim R 446; DPP v Hamman (CCA, unreported, 1.12.98). Where the offences were committed over a period of time, it may be correct to say that the respondent was of good character at the time of the first offences, but not thereafter: R v Houghton [2000] NSWCCA 62 at [18].

126 Nor is an offender entitled to rely on good character where there has been a course of offending and conduct to prevent detection and to allow the offending conduct to continue. It would not be appropriate to take into account charitable and community work where that was funded out of defrauded funds and part of maintaining a pretence of respectability, integrity and responsibility: R v Smith [2000] NSWCCA 140 at [20-24]. Here the offender has maintained his practice as a solicitor.

127 Prior integrity and good character carries little weight in cases where there has been systematic defrauding of the revenue over a significant period of time: R v Cappaddona & Anor (2001) 122 A Crim R 52 at [23]; DPP v Hamman (CCA unreported 1.12.98).

128 On the evidence available to me, the accused was a person of prior good character. Nevertheless, balanced against that, there is no evidence of remorse, nor, in those circumstances (as was conceded by Mr Robberds QC), evidence on which I can find that there are good prospects of rehabilitation. The best way I think that aspect can be taken into account is in establishing a longer than normal period of supervision.

129 Statistics published by the Judicial Commission for offences of this nature show the following: 70% prison; 9% suspended sentence, 6% suspended sentence with supervision, 4% Periodic Detention, 2 % Home Detention. 25% - 3 years 27% - 2 year non-parole period

130 Using the fields of inquiry relevant to this case, namely an offender of his age - 80% prison - 24 month, 42 month, 48 month term, 6 month, 18 month, 24 month non-parole period.

131 Those statistics for the relatively small sample size also need to be viewed with the usual caution, that is, that the statistics do not indicate the facts of the particular offences not the personal circumstances of each of the relevant offenders.

132 A letter from the Law Society of New South Wales was tendered (Exhibit S5). The Legal Services Commissioner, Mr Marks, makes it clear that there is a present application to have Mr Nikolaidis removed from the roll of legal practitioners. He is not aware of any disciplinary proceedings which would be affected by the criminal conviction.

133 Here the offender has appealed in these proceedings - the original appeal filed prior to these sentencing proceedings being both against conviction and sentence. I have been advised that pending any appeal, the offender will be able to continue to practice without any restriction. In any hearing of the action the Law Society will have to prove the conduct and cannot simply rely on the conviction. Mr Marks' letter suggests that there may be further delays while such professional action is resolved.

134 Accordingly, the Crown submits, and I agree, that it cannot be said that it is inevitable that the offender will be removed from the roll of solicitors. However, depending on the outcome of any appeal, I think it clear that there is a strong likelihood that that will occur. If such an action is successful then the offender will be ineligible to practise as a solicitor.

135 If that occurred following any such disciplinary action, there would also be a substantial impact on the offender's income, his financial position, his firm's client base and income.

136 The other impact of this conviction and any period of imprisonment will be in relation to the employees and goodwill of the firm. However, despite this being raised, no evidence was tendered in relation to the precise impact.

137 The approach of the courts in dealing with such matters is set out in the following decisions:

138 The weight to be given to any extra-curial punishment will depend on all the circumstances of the case and in some cases extra-judicial punishment attracts little or no weight. The sentencing court is entitled to take into account punishment meted out by others, such as abuse, harassment and threats of injury to person and property. In R v Allpass (1993) 72 A Crim R 561 the court observed that, quite apart from the sentence, "the respondent and his wife have paid a high price for his wrongdoing" and, hence, this as a matter that could be taken into account.

139 The Court in R v Rivkin [2004] NSWCCA 7 referred at paragraphs 411 and 412 to matters put forward by the defence in that case as extra curial punishment, including that the appellant had suffered disgrace and humiliation, that his wife and family would be affected by the conviction, that the appellant had lost his good standing in the community and his profession which would impact on his livelihood, (most of which comments appear to be apposite here) and that he would be disqualified from managing a corporation and he may lose his security dealer's license. The parallels with the (probable) loss of a practicing certificate in this case are very similar.

140 However the Court also made the following observations at paragraph 426:- "It is not the case that an offender who comes from a privileged background, or who occupies a significant position in commerce or society can hope to escape a custodial sentence, where that is appropriate for the offence, simply because it may be humiliating or embarrassing. Equality before the law does not permit any such proposition."

141 I take into account the matters set out above in relation to the facts of the offence, the criminality involved, the offender's subjective circumstances, the delays which have occurred, the likely professional disciplinary action, and, if so, the financial consequences to the offender and his firm as well as the aggravating and mitigating factors and the principles of sentencing which are relevant. I also take into account the fact that the offender has already suffered some serious loss or detriment as a result of having committed the offence and the potential losses which may follow from likely professional action which may be taken.

142 Having considered the authorities set out above and the JIRS statistics to which I have referred, it is my view that the sentence I am considering is within the range of a proper exercise of my sentencing discretion.

143 I need to consider what sentencing options are open and available to me on the evidence and in light of the principles and objectives of sentencing the circumstances of this case particularly given the age of the offender, the absence of any prior convictions and the fact that any sentence of imprisonment would be the first time for this offender.

144 It was submitted by Mr Robberds QC that an appropriate penalty was a fine. The assessment in the pre-sentence report is that the offender is suitable for a Community Service Order and for a Periodic Detention Order. I do not think that any of those options - nor the option of Home Detention although not urged on me by either counsel - are appropriate to meet the requirements of general deterrence in these circumstances, the facts of the offence and the circumstances, including the professional position, of the offender.

145 I have considered this option at some length over the intervening period given the comments made in R v Dinsdale (2000) 202 CLR 321 and R v Zamagias [2002] NSWCCA 17, with particular regard to the features of the offender's age and the fact that he has had no prior convictions. I do not think that those factors, nor the matters raised in submissions justify the suspension of the sentence.

146 That leaves the last option of a sentence of full time imprisonment - which is in my view the only option despite the personal circumstances of the offender given his age, family and professional position and the absence of any prior convictions. In my view such a sentence is both required and justified given the facts of the offence, and the other circumstances and factors I have outlined above particularly the requirements of general deterrence.

147 The offender is a man of 52 years of age (D.O.B. 5 June 1955). He is married with two children. A sentence of imprisonment would mean his first time in custody.

148 In my view it is appropriate that there be a finding of special circumstances which would warrant an adjustment to the statutory ratio of the order of 50%.

149 A common feature of sentencing for white collar crimes involving fraudulent abuse of trust has been the imposition of lengthy head sentences, but with a substantial gap between head sentence and non-parole periods or minimum terms: "This has probably been the consequence of a desire on the part of the courts on the one hand to reflect the need for general deterrence, and on the other hand to give due account to the fact that offenders frequently have no prior criminal history, are unlikely to re-offend, and have good prospects of rehabilitation".

Proceedings prior to sentence : Commencement date of sentence

150 This matter was set down immediately after the delivery of the jury's verdict for the sentencing proceedings to take place on 16 November, 2007. That date was selected to suit the convenience of counsel and Mr Nikolaidis as well as the commitments of the Court.

151 Directions were made as to the filing of brief written submissions on 23 August, 2007. An outline of the Crown submissions was received on 19 September, 2007. No submissions were received from the offender until 16 November 2007.

152 On 14 November, 2007 the offender, through Mr Robberds QC, moved for the adjournment of the proceedings on the basis that an appeal had been lodged against conviction and sentence. I indicated that that latter aspect of the appeal appeared to be premature. That application was refused and the matter proceeded on 16 November, 2007. I indicated on 14 November that given the trial commitments I had, I would hear submissions and any evidence on 16 November, 2007 and the matter would be stood over for the delivery of sentence on 23 November, 2007. The intervening period could be utilised by the Defence for any purposes that were considered appropriate.

The offender was convicted following the delivery of the jury's verdict.

The offender is sentenced to a period of 2 years imprisonment to date from 23 November 2007 and to expire on 22 November 2009, with a non-parole period of 12 months imprisonment to date from 23 November 2007 and to expire on 22 November 2008.

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Cases Cited (14)