Regina v Swadling

Details of the offences the subject of Form 1 (omitting cents) were:

21. 9.00 8,650 20.10.00 6,153 1.12.00 5,550 13.12.00 5,000
22. 2. 01 21,500
23. 6. 01 6,195
24. 6. 01 3,500
25. 7. 01 15,150
26. 8. 01 10,000 31.12.01 7,000
27. 1. 02 3,900 TOTAL $322,766

The judge took the view that these were very serious offences involving significant amounts of money and breaches of trust. He added: "…although the crimes were committed in an opportunistic sense in that the circumstances enabling you to commit the crimes more or less fell into your lap, there was obviously some degree of planning on your part particularly after the commission of the first offence and therefore these offences … fell towards the upper end of the scale …"

The judge also took into account that apart from a payment of $1000 which the applicant had made recently, none of the money had been recovered.

The applicant prepared a list of her expenses in an endeavour to explain where $322,766 had gone. She could not account for about $79,700 and she spent about $53,000 on an eight weeks overseas holiday in Europe and America for herself. She did not take into account the salary which she had received. She stated that she spent quite a lot of money on buying clothes and other items for the members of her family. The family had no money as her father was on a disability pension and living in Housing Commission premises. During the middle of 2000 her eldest brother, Adam, to whom she was very close and with whom she shared a flat, was trying to set up his own business as a builder. She decided to help provide the money for the purchase of a utility. Adam became ill in October 2000. From November 2000 he was in and out of hospital. He was unable to obtain a transplant. He died in May 2001 from leukaemia. She met the funeral expenses and the expenses of the wake. It was a large funeral and a large wake. The costs of these and associated costs totalled about $27,500. In June and July she diverted about $45,800 from the company to her account.

The applicant told the psychologist that she knew that she should not have taken the money for the holiday and that she would eventually be caught.

The applicant expressed remorse for her actions to the members of the company and to the psychologist. The judge found "that remorse is genuine to a certain extent".

The judge gave the applicant a discount of 25 per cent for pleading guilty at the earliest opportunity. She had no previous convictions.

The applicant was born on 1 March 1973. She came from a very close but financially disadvantaged family. Her father's injuries prevented him from working, so little could be afforded. From the time she started working she assisted with the support of the family.

The psychologist has written: "Karen requires intensive counselling to mitigate her anxiety, grief, severe depressive feelings and her self-defeating thoughts and behaviour. She would also benefit from attending a course in self-esteem. If she goes into custody, she will require ongoing supportive therapy and monitoring by mental health professionals."

The judge noted that she had the support of her family and friends.

The judge took into account that the misappropriation of funds had caused the Frost family and the business considerable hardship. The judge found special circumstances in the applicant's prior good character, in this being her first time in custody and in her requiring supervision upon her release to parole to assist her, especially as to the matters referred to in the psychologist's report. He referred to the need to impose sentences in accordance with the judgments in Pearce (1998) 194 CLR 610. He added: "I have also taken into account the requirement to impose sentences having an overall appropriate effect having regard to the principle of totality bearing in mind the need to decide how a sentence is imposed to run either concurrently cumulatively or partly concurrently and partly cumulatively."

Appeal Grounds 1, 2 and 3 read: 1. The sentences imposed are not in accordance with Pearce v The Queen 2. The sentence imposed on count 1 is manifestly excessive.

3. The total effective head sentence is manifestly excessive.
4. The applicant relied on the much quoted passage from the judgment of McHugh, Hayne and Callinan JJ in Pearce at 624: "A judge sentencing an offender for more than one offence must fix an appropriate sentence for each offence and then consider questions of cumulation or concurrence, as well, of course as questions of totality."

Reliance was also placed on statements in this Court to the effect that this was a matter of fundamental principle: R v AEM (Snr) [2002] NSWCCA 58 at [65], R v Carr [2002] NSWCCA 434 at [35], R v Felton (2002) 135 A Crim R 328 at [20-21] and R v Wheeler [2000] NSWCCA 34 at [32]. In R v Carr Howie J suggested that if the overall sentence imposed was appropriate to reflect the totality of the criminality there would be little reason for this Court to intervene to redress the error of not applying Pearce correctly..

Reliance was also placed on the remark of Sperling J (with whom Carruthers AJ agreed and Beazley JA substantially agreed) in Gorman [2002] NSWCCA 516 at [54] that it is difficult to envisage circumstances in which it would now be permissible to commence all of a series of multiple sentences on the same date.

Senior counsel for the applicant referred the Court to R v Fraser [2000] NSWCCA 97 at [18], where James J said: "Where the Court is sentencing for as many as twenty-five offences and the total effective sentence is to be only three and a half years I do not consider that the Court is required by the decision of the High Court in Pearce v The Queen to impose a series of separate sentences for each of the twenty five offences, with separate commencing dates."

James J had in mind that the Court was not required to impose 25 separate sentences each of a few months.

In R v Itamura [2000] NSWCCA 502 the sentencing judge had to consider some 42 offences of armed robbery. He followed the old practice of selecting one count (count 14), being one of the worst offences, and imposing a lengthy sentence on it (minimum term of 12 years and an additional term of 6 years) and imposing fixed concurrent terms of 3 years on all the other counts. There was an application for leave to appeal against the sentence of 18 years but no appeal against any of the other sentences. The sentence of 18 years was manifestly excessive. At [46] I said: "The problem faced by a sentencing judge becomes acute where there are a large number of offences being dealt with. In Fraser [2000] NSWCCA 97 at para 18 this Court held that where the offender has been sentenced for as many as twenty five offences the Court is not obliged to impose a series of separate sentences with separate commencement dates. The idea of imposing twenty five consecutive sentences each of a few months would be both impractical and verging on the absurd. The problems are usually best overcome by making the sentences concurrent or partially cumulative and partially concurrent or by making one group of sentences on a number of charges concurrent and another group of sentences on a number of other charges, those sentences being concurrent as between themselves, cumulative on the first group. This last mentioned course was permissible at the time the judge imposed his sentences."

In Johnson v The Queen (2004) 78 ALJR 616 Gummow, Callinan and Heydon JJ said at [26] "…the joint judgment in Pearce recognises the currency of Mill by referring to the principle of totality which it reiterates. The joint judgment in Mill expresses a preference for what should be regarded as the orthodox, but not necessarily immutable, practice of fixing a sentence for each offence and aggregating them before taking the next step of determining concurrency. Pearce does not decree that a sentencing judge may never lower each sentence and then aggregate them for determining the time to be served. To do that, is not to do what the joint judgment in Pearce holds to be undesirable, that is, to have regard only to the total effective sentence to be imposed on an offender. The preferable course will usually be the one which both cases commend but neither absolutely commands. Judges of first instance should be allowed as much flexibility in sentencing as is consonant with consistency of approach and as accords with the statutory regime under which the sentencing is effected."

I would respectfully echo the need for flexibility when sentencing for multiple offences. Experience has shown that this is an area where many unforeseen difficulties can arise.

The applicant submitted that the sentence of 7 years imprisonment bore no relationship to the offence committed and her circumstances, even taking into account the offences on the Form 1. A sentence of 7 years having allowed a 25 per cent discount for the plea of guilty indicates a starting point of 9 years 4 months (or 93.3 per cent of the maximum penalty of 10 years). It was contended that there was nothing arising from the facts of the offence or the circumstances of the offender which warranted a sentence of that magnitude.

The method of operation used by the applicant was simplistic. The moneys were electronically transferred from her employer's account into her account. She did not use an intermediary or other guile. It was an easy fraud to investigate.

Both parties endeavoured to assist the Court by reference to the previous decisions of this Court. Regard was also had to decisions on ss 178BA and 178BB of the Crimes Act. Counsel produced detailed schedules which I have studied. However, the facts vary greatly in the cases and not a great deal of assistance is to be gained from them. The cases are at one in deploring defalcations and breaches of trust, whether the offender is in a senior executive position or a relatively junior position, although the former are viewed as more serious. In some instances pressing personal circumstances led to the defalcations but, of course, did not excuse them. In most of the cases the risk of re-offending was slight. Often the offender had previously been a person of good character. The cases stress the need for condign punishment and for sentences to reflect general deterrence. After studying the previous decisions I have concluded that rather than embarking upon an extensive review of the cases which is likely to be unrewarding, it is better to concentrate upon an analysis of the facts of the various offences in the light of the general principles which apply.

As to count 8, the starting point of 9 years 4 months suggests a case that is approaching the worst case scenario. The present case does not fall into that category. Her method of operation was unsophisticated and did little to cover her tracks, she was a relatively junior employee and the amount taken, while significant, was not large. I do not agree that this offence falls towards the upper end of the scale for such offences. Matters in the upper half of the scale of seriousness for offences under s 156 of the Crimes Act frequently involve bank accounts in false names, manipulated records to make it hard to ascertain what has happened and where the money has gone and documents prepared for the purpose of deflecting attention from the criminal activity and creating false trails. Another example is where the money stolen weakens the business and the defalcating employees cause an opposition business to be set up (with perhaps some of the stolen money) which gains many of the customers of the initial business. Sometimes steps are taken to frustrate audits and investigations. Usually, the graver examples of offences under s 156 involve quite senior executives who have used their position to obtain the money and prevent effective investigation.

In my opinion the offence the subject of count 8 and most of the other offences fall about the middle of the scale, even allowing for the offending conduct continuing for 21 months. Count 8 was the penultimate offence, occurred 19 months after the first offence, and involved the largest sum of money.

The judge undertook no analysis of the individual offences and does not appear to have given attention to each individual offence but to have adopted a global approach. This is contrary to Mill and Pearce. Re-sentencing is required.

I will deal with count 8 first where eleven similar offences were taken into account which together involved a substantial amount of money.

The correct starting point on count 8, taking into account the eleven other offences, was one of 8 years. The starting point takes into consideration the applicant's subjective features. I agree with the judge that a discount of 25 per cent should be allowed for the plea of guilty. That leads to a sentence of 6 years. The sentence of 7 years imposed by the judge was manifestly excessive.

The applicant is unlikely to re-offend. I agree with the judge that there were special circumstances for the reasons he gave. The applicant will need an extended period of support and supervision. She is likely to have considerable difficulty in obtaining employment in her field of accounting work. She will have the support of her family and friends. She will need it. They will probably not be able to help her obtain employment. I would set a non-parole period of 3 years.

It is now necessary to consider the sentences on the other counts. As to count 1, this was the first occasion (26 July 2000) on which she offended and the amount involved, namely $6950 was relatively small. The offence was opportunistic. She had hitherto been a person of good character. The sentence of 4 years was manifestly excessive. For the offence the subject of count 1 the correct sentence was one of 18 months imprisonment with a non-parole period of 9 months.

The offence the subject of count 2 took place on 27 September 2000 and involved $31,521. This was about the time the applicant was helping her brother in a building business. That included the purchase of a utility. That is no excuse. This was her third offence and represents a substantial increase in the amount being stolen. A sentence of a fixed term of 4 years is manifestly excessive. The correct sentence was 2 years imprisonment with a non-parole period of 1 year.

The offence the subject of count 3 occurred on 27 December 2000, involving $11,025 and that the subject of count 4 occurred on 31 January involving $21,450. These were her 7th and 8th offences and took place during the period that her brother was in and out of hospital and incurring heavy medical and associated expenses. It is not clear how much of the money taken was spent on the brother and his needs. This is no excuse. The applicant's criminality was mounting. A sentence of a fixed term of 4 years was manifestly excessive. For each offence the correct sentence was one of 2½ years with a non-parole period of 15 months.

The offence the subject of count 5 occurred on 8 June 2001, involving $21,001.50. This was the 10th offence and was during the time the expenses associated with her brother's funeral and wake probably had to be paid. This is no excuse. A sentence of a fixed term of 4 years was manifestly excessive. The correct sentence was one of 3 years with a non-parole period of 18 months.

The offence the subject of count 6 took place on 25 September involving $15,165.35 and that the subject of count 7 on 26 October 2001 involving $30,000. These are the 15th and 16th offences. Some of this money may have been expended on the applicant's overseas trip. A fixed term of 4 years is manifestly excessive. The correct sentence for each offence was 3 years 6 months with a non-parole period of 21 months.

The offence the subject of count 9 occurred on 22 April 2002 involving $43,928.49. This was the 20th offence and the amount involved is significant. A fixed term of 4 years is manifestly excessive. The correct sentence is one of 4 years with a non-parole period of 2 years.

It is now necessary to consider questions of cumulation, concurrency and totality. The sentences imposed must reflect the total criminality involved.

The sentences should be partially concurrent and partially cumulative to reflect the overall criminality. They should also reflect the accelerating criminality with the continued commission of offences. The substantial number of offences taken into account on count 8 has meant that the sentence on this count has had to be appreciably greater than on the other counts. This has affected the structure of the sentences in arriving at a result which is conformable with the application of the principle of totality. In applying this principle I have not only had regard to cumulation and concurrency, but to the other permissible approach of shortening some of the individual sentences.

I propose the following orders: 1. Leave to appeal against sentence granted.

2. Appeal again sentences allowed. Sentences quashed.

3. In lieu of the sentences imposed the applicant is sentenced as follows: (a) On count 1 - imprisonment for 18 months commencing on 19 June 2003 with a non-parole period of 9 months expiring on 18 March 2004

(b) On count 2 - imprisonment for 2 years commencing on 19 June 2003 with a non-parole period of 1 year expiring on 18 June 2004

(c) On each of counts 3 and 4 - imprisonment for 2 years 6 months commencing on 19 December 2003 with a non-parole period of 15 months expiring on 18 March 2005

(d) On count 5 - imprisonment for 3 years commencing on 19 March 2004 with a non-parole period of 18 months expiring on 18 September 2005

(e) On each of counts 6 and 7 - imprisonment for 3 years 6 months commencing on 19 June 2004 with a non-parole period of 21 months expiring on 18 March 2006

(f) On count 9 - imprisonment for 4 years commencing on 19 September 2004 with a non-parole period of 2 years expiring on 18 September 2006

(g) On count 8 - imprisonment for 6 years commencing on 19 September 2003 with a non-parole period of 3 years expiring on 18 September 2006

(h) The applicant will be eligible for release to parole on 19 September 2006.

Thus the overall head sentence will be one of 6 years 3 months and the overall effective non-parole period will be 3 years 3 months.

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