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  • {solid} Appeal Determined (QCA)

R v Kelly

 

[2018] QCA 307

 

SUPREME COURT OF QUEENSLAND

 

CITATION:

R v Kelly [2018] QCA 307

PARTIES:

R
v
KELLY, Mark John
(applicant)

FILE NO/S:

CA No 297 of 2017

DC No 1924 of 2017

DIVISION:

Court of Appeal

PROCEEDING:

Sentence Application

ORIGINATING COURT:

District Court at Brisbane – Date of Sentence: 1 December 2017 (Martin SC DCJ)

DELIVERED ON:

9 November 2018

DELIVERED AT:

Brisbane

HEARING DATE:

30 July 2018

JUDGES:

Sofronoff P and Gotterson JA and Ryan J

ORDERS:

  1. Grant leave to appeal against sentence.
  2. Appeal against sentence dismissed.

CATCHWORDS:

CRIMINAL LAW – APPEAL AND NEW TRIAL – APPEAL AGAINST SENTENCE – GROUNDS FOR INTERFERENCE – GENERALLY – where the applicant pleaded guilty to two counts of fraud and one count of receiving tainted property – where the applicant was sentenced to five years imprisonment on each count, to be served concurrently – where the learned sentencing judge was informed by the prosecutor that the maximum penalty for all counts was 14 years imprisonment, when, in fact, the maximum penalty for the two counts of fraud was only 12 years imprisonment – where a material error was made in the exercise of the sentencing discretion – where the appellate court is therefore required to re-exercise the sentencing discretion – whether, upon a re-exercising of the sentencing discretion, the appellate court concludes that a lesser sentence is appropriate

Serious and Organised Crime Legislation Act 2016 (Qld), s 126

Kentwell v The Queen (2014) 252 CLR 601; [2014] HCA 37, followed

Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25, applied

R v Pinnuck [2014] QCA 189, considered

R v Twidale [2009] QCA 200, considered

COUNSEL:

The applicant appeared on his own behalf

C N Marco for the respondent

SOLICITORS:

The applicant appeared on his own behalf

Director of Public Prosecutions (Queensland) for the respondent

  1. [1]
    SOFRONOFF P:  I agree with the reasons of Gotterson JA and the orders his Honour proposes.
  2. [2]
    GOTTERSON JA:  On 23 August 2017, the applicant, Mark John Kelly, pleaded guilty in the District Court at Brisbane to two counts of fraud to the value of more than $30,000 and one count of receiving tainted property.  He was sentenced on 1 December 2017.  In relation to each count, the applicant was sentenced to five years imprisonment.  Each sentence is to be served concurrently with the others and suspended after 20 months, for an operational period of five years.
  3. [3]
    The applicant himself filed an application for leave to appeal against sentence on 13 December 2017.[1]  The application has one ground of appeal.  It is that the sentence is manifestly excessive.

The error in sentencing

  1. [4]
    The respondent has, with commendable candour, drawn to the Court’s attention an erroneous footing on which the learned sentencing judge proceeded in sentencing the applicant.  The error is not referred to in the applicant’s application for leave or his written submissions.
  2. [5]
    His Honour was informed by the prosecutor that the maximum penalty for all counts was 14 years.[2]  Submissions on sentence were made on the basis that that was the maximum penalty.  In fact, the maximum penalty for Counts 1 and 2 was 12 years and the maximum penalty for Count 3 was 14 years.[3]
  3. [6]
    Section 668D(1)(c) of the Criminal Code (Qld) confers a right of appeal against sentences on indictment with the leave of the Court.  Section 668E(3) requires the Court, if it is of the opinion that some other sentence, whether more or less severe, is warranted in law and should have been passed, to quash the sentence and to pass such other sentence in substitution.
  4. [7]
    In Baxter v The Queen[4] Spigelman CJ explained the operation of the New South Wales analogue of s 668E(3) in the following terms:

“The import of [79] of Simpson[5] was to ensure that submissions in the Court of Criminal Appeal did not proceed as if the identification of error created an entitlement on the part of an Applicant to a new sentence, for example, by merely adjusting the sentence actually passed to allow for the error identified.  That would be to proceed on the assumption that the sentencing judge was presumptively correct, when the Court has determined that the exercise of the discretion had miscarried.  Section 6(3) is directed to ensuring that the Court of Criminal Appeal does not proceed in that manner, but re-exercises the sentencing discretion taking into account all relevant statutory requirements and sentencing principles with a view to formulating the positive opinion for which the subsection provides.”

  1. [8]
    This analysis was subsequently approved in the plurality judgment in the High Court decision in Kentwell v The Queen.[6]  French CJ, Hayne, Bell and Keane JJ said:[7]

“Spigelman CJ’s analysis in Baxter should be accepted.  When a judge acts upon wrong principle, allows extraneous or irrelevant matters to guide or affect the determination, mistakes the facts or does not take into account some material consideration,[8] the Court of Criminal Appeal does not assess whether and to what degree the error influenced the outcome.  The discretion in such a case has miscarried and it is the duty of the Court of Criminal Appeal to exercise the discretion afresh taking into account the purposes of sentencing[9] and the factors that the Sentencing Act,[10] and any other Act or rule of law, require or permit.  As sentencing is a discretionary judgment that does not yield a single correct result, it follows that a range of sentences in a given case may be said to be “warranted in law”.  A sentence that happens to be within the range but that has been imposed as the result of a legally flawed determination is not “warranted in law” unless, in the exercise of its independent discretion, the Court of Criminal Appeal determines that it is the appropriate sentence for the offender and the offence.  This is not to say that all errors in the sentencing of offenders vitiate the exercise of the sentencer’s discretion.  By way of example, s 44(1) of the Sentencing Act requires the court when sentencing an offender to imprisonment to first set the non-parole period and then set the balance of the term.  Prior to 1 February 2003, a court was required to first set the term of the sentence and then specify the non-parole period.  A court which sentences an offender to imprisonment after 1 February 2003 by first setting the term of the sentence commits legal error.  Without more, the error does not affect the exercise of the sentencer’s discretion.”

  1. [9]
    The importance of maximum penalties in sentencing was considered by Gleeson CJ, Gummow, Hayne and Callinan JJ in Markarian v The Queen.[11]  In a joint judgment, their Honours observed:[12]

“Legislatures do not enact maximum available sentences as mere formalities.  Judges need sentencing yardsticks.  It is well accepted that the maximum sentence available may in some cases be a matter of great relevance.  …

It follows that careful attention to maximum penalties will almost always be required, first because the legislature has legislated for them; secondly, because they invite comparison between the worst possible case and the case before the court at the time; and thirdly, because in that regard they do provide, taken and balanced with all of the other relevant factors, a yardstick.”

  1. [10]
    These observations illustrate why it is that courts have, as a general rule, characterised a misapprehension of the maximum penalty for an offence as being a material error which vitiates the sentencing decision and which, consistently with Kentwell, requires consideration to be given to the re-exercise of the sentencing discretion by the appellate court.  That must be done in this case.
  2. [11]
    In the course of so doing, I propose to have regard to the applicant’s written and oral submissions as to why he maintains that his sentence is manifestly excessive.

The circumstances of the offending

  1. [12]
    The applicant was represented by counsel at his sentence hearing.  During the hearing, a Statement of Facts[13] was received into evidence with the concurrence of defence counsel.  The following facts are drawn from it.
  2. [13]
    The applicant and Mr Peter Radford, who was considerably older, were long-time friends.  They had undertaken some financial ventures together.  The applicant would assist Mr Radford with paperwork for his banking and finances.
  3. [14]
    In February 2010, the applicant prepared an application for a loan by the Bank of Queensland (“BOQ”) of $450,000 ostensibly to Mr Radford.  It was the applicant’s intention to use a residential property owned by Mr Radford as security for the loan.
  4. [15]
    The loan application was submitted by the applicant to one Albin Buchner, then a BOQ employee.[14]  Buchner was known to the applicant.[15]  False payslips were also submitted with the application.  They indicated that Mr Radford was employed by a company, Auswealth Financial Solutions Pty Ltd (“Auswealth”).  That company acted at the direction of the applicant.
  5. [16]
    Buchner knew that Auswealth did not have any employees.[16]  He questioned the applicant about the false payslips to which the applicant replied:

“Come on; just help me out, my uncle really needs the money”.

  1. [17]
    In March 2010, Buchner forwarded the loan documentation to BOQ.  He mentioned that the payslips were false but that apparently was overlooked.  He finalised the processing of the applications.  Two loans ostensibly to Mr Radford were approved: a home loan in the amount of $350,000 secured against Mr Radford’s property; and a line of credit for $98,000 also secured against that property.  These loans were the subject of Counts 1 and 2 respectively.
  2. [18]
    During May 2010, the home loan funds were transferred into an account in Mr Radford’s name but for which the contact details and address were the applicant’s.  By a series of further transfers, some $341,000 of the $350,000 loan funds were deposited into Auswealth’s bank account.  Of that amount, $30,000 was transferred directly and the remainder via a second bank account in Mr Radford’s name.
  3. [19]
    The line of credit was accessed on 24 May 2010.  From that date to 9 June 2010, some $67,000 was transferred from it into Auswealth’s bank account.
  4. [20]
    In October 2010, a second loan application process was commenced with La Trobe Financial (“La Trobe”).  Buchner and the applicant were involved in assembling application documents for a loan of $450,000 on the security of a business premises at Woolloongabba owned by Mr Radford.  The documents contained false information concerning the latter’s contact details and income records.
  5. [21]
    The account nominated to receive the funds was an account with the ANZ Bank conducted by Majik Solutions Pty Ltd (“Majik”), a company associated with the applicant.  He and his wife were the only signatories to the account.[17]  La Trobe transferred $392,786.03 into the account on 16 December 2010.  Over the following weeks, the applicant withdrew $335,535 from it which he used to purchase bank cheques payable to various individuals.
  6. [22]
    The applicant knew that the money in Majik’s bank account had been fraudulently obtained.  He received and used the money in any event.  The money so used was the subject of Count 3.
  7. [23]
    The dishonest conduct inherent in each of the counts occurred without Mr Radford’s knowledge.  In early 2011, he discovered that substantial monies had been transferred from his accounts.  He complained to the applicant who, on several occasions over ensuing months, told Mr Radford to leave it with him and that he would “sort it out”.
  8. [24]
    In March 2012, Mr Radford engaged a solicitor to seek return of the moneys from the applicant.  He made a complaint to police in July 2012.  On 21 November 2012, the applicant met with Buchner.  During their conversation, which Buchner recorded, the applicant told him that Mr Radford had owed him money.  He did not have security over Mr Radford’s property.  He needed to get his money out and he did so.
  9. [25]
    The applicant was apprehended by police on 27 January 2014.  He declined to be interviewed and was subsequently charged.  Buchner was apprehended and subsequently charged on 26 March 2014.  On 28 July 2017, Buchner provided a statement to police.  He set out his and the applicant’s involvement in the BOQ frauds and his knowledge of the La Trobe loan application.  He also provided police with the recording that he had made on 21 November 2012.

The applicant’s personal circumstances and antecedents

  1. [26]
    The applicant was 47 and 48 years of age at the time of the offending.  He was 54 years old at sentence.  The applicant had had a successful career in the finance industry and held a significant position in the local community.  His offending terminated his eligibility to continue with his career and restricted his income earning capacity.  He has not paid any compensation as redress for his offending.
  2. [27]
    The applicant’s offending and resultant financial predicament have also adversely affected his ability to maintain a relationship with his young daughter.  He has not seen her for at least two years.
  3. [28]
    Prior to the dishonesty offending, the applicant had no criminal history.  By the time he was sentenced, he had been admitted to probation for convictions for traffic offences committed after the dishonesty offences.

The sentencing remarks

  1. [29]
    In sentencing the applicant, the learned sentencing judge referred to the above circumstances of the offending and the applicant’s personal circumstances.  He had regard for the timely pleas of guilty and the “considerable delay” in bringing the matter to finality.
  2. [30]
    His Honour noted that Buchner, who did not have a criminal history, had been charged with the Counts 1 and 2 offending for which he had been sentenced on 22 August 2017.  He observed that the sentencing judge appeared to have accepted a Crown submission that before cooperation and restitution were taken into account, a sentence of four to five years imprisonment with one third of it to be served in actual custody, would have been appropriate.[18]  In the event, Buchner was sentenced to three years and two years imprisonment on Counts 1 and 2 respectively, to be served concurrently.  His imprisonment was immediately suspended and he was ordered to pay $50,000 compensation to Mr Radford.
  3. [31]
    In the applicant’s case, the Crown had submitted that a head sentence in the range of six to seven years was appropriate.[19]  Defence counsel did not “quibble” with that range.[20]  She made a submission that the head sentence should be six years with parole eligibility after serving a third.[21]
  4. [32]
    His Honour thought that the sentence for which defence counsel had submitted did not quite reflect parity with Buchner’s sentence.  Although he regarded that sentence as being “lenient”,[22] parity considerations obviously influenced him to fix the applicant’s sentences at five years for each count.

What is an appropriate sentence for the applicant’s offending?

  1. [33]
    A re-exercise of the sentencing discretion is not one of adjusting for identified error below.  Nor is it confined by submissions made to the learned sentencing judge or how he dealt with them.  This Court must make its own independent assessment of the sentence appropriate for the applicant’s offending.
  2. [34]
    It is unnecessary to restate the circumstances of the offending.  Broadly similar offending occurred in two cases on which the parties placed reliance at the sentence hearing.  They are R v Twidale[23] and R v Pinnuck.[24]  These cases provide a useful yardstick for re-sentencing the applicant.  Both involved fraud.  However, in both, the prevailing maximum penalty was 10 years imprisonment.
  3. [35]
    The offender in Twidale had the additional circumstance of aggravation that the fraud was committed whilst the offender was an employee.  The offending took place over a six-year period but the overall amount of money involved was almost $200,000 less than in the applicant’s case.  The offender admitted her conduct to police and made a genuine effort to make some restitution.  She was refused an extension of time to apply for leave to appeal against her sentence of seven years imprisonment with parole eligibility after 28 months.
  4. [36]
    In Pinnuck, the offender also committed the offences as an employee.  However, he did not stand to gain directly from the offending.  He committed the offences for the benefit of the employer company but without the knowledge of company members.  The total amount of the fraud was $294,838.40, substantially less than in the applicant’s case.  Significantly, the offender had prior convictions for dishonesty for which he had been sentenced to four years and six months imprisonment with a recommendation for parole after serving two years.  The offender’s sentence for the subject offending was five years imprisonment suspended after 20 months.  It was not disturbed on appeal.
  5. [37]
    These sentencing decisions indicate that a sentence of least five years, of which he must serve one third in actual custody, is appropriate for the applicant’s offending.
  6. [38]
    The applicant has submitted that an appropriate sentence is four years with parole eligibility after serving one quarter of it.  He has not sought to justify that submission by reference to any other sentencing decision.  Instead, he had sought to place much reliance upon parity with Buchner’s sentence and also upon his “genuine and unreserved remorse” for his offending.
  7. [39]
    As to parity, the sentence imposed on the applicant must not be one that would give rise to a justifiable sense of grievance on his part when compared with Buchner’s sentence.  That is a matter to be assessed bearing in mind relative criminality, cooperation and remorse, amongst other things.
  8. [40]
    The applicant’s offending involved a markedly higher level of criminality than that of Buchner.  The latter was convicted of the Counts 1 and 2 offending only.  Count 3 doubled the money misappropriated.  Buchner was an “assister”; he did not benefit personally from the monies fraudulently obtained.
  9. [41]
    Further, Buchner cooperated with police to a point of giving a statement implicating the applicant.  Moreover, his cooperation evidenced true remorse.  As well, Buchner offered, and was ordered, to make restitution.
  10. [42]
    Taking all those differentiating factors into account, were the applicant to be sentenced to concurrent five year terms of imprisonment for each offence suspended after 20 months, such a sentence would not give rise to a justifiable sense of grievance on the applicant’s part in light of the sentence imposed on Buchner.
  11. [43]
    The applicant’s assertion of “genuine unreserved remorse” on his part needs to be viewed, it must be said, with some circumspection.  In submissions, the applicant attributed his offending conduct to a prevailing culture of aggression and corner cutting in the industry in which he worked.  Such an attribution is apt to suggest that, in some way, he regarded that as moderating the culpability of his offending.
  12. [44]
    In addition, the impacts of imprisonment upon the applicant, as described by him in oral submissions, were rather self-oriented.  They included his loss of income, subsequent bankruptcy and distancing from his daughter and parents.
  13. [45]
    For these reasons, I would reject the applicant’s submission as to the sentence that should now be imposed.  In my judgment, the sentences imposed by the learned sentencing judge are appropriate ones.

Disposition

  1. [46]
    In Kentwell, the plurality held that if in the exercise of its independent discretion, the appellate court concludes that the same or a greater sentence is appropriate, in neither case is the court required to re-sentence.[25]  It may grant leave to appeal against sentence but dismiss the appeal.  That is the course that should be followed in this case.

Orders

  1. [47]
    I would propose the following orders:
    1. Grant leave to appeal against sentence.
    2. Appeal against sentence dismissed.
  2. [48]
    RYAN J:  I agree with the orders proposed by Gotterson JA for the reasons his Honour gives.

Footnotes

[1]  AB37-38.

[2]  AB12 ll1-7, 32.

[3]  The maximum penalty for the Count 1 and 2 offences was increased to 14 years for offending committed on and after 9 December 2016: Serious and Organised Crime Legislation Act 2016 (Qld) s 126.

[4]  (2007) 173 A Crim R 284; [2007] NSWCCA 237 at [19].

[5] R v Simpson (2001) 126 A Crim R 525; (2001) 53 NSWLR 704.

[6]  (2014) 252 CLR 601; [2014] HCA 37; at [40], [42].

[7]  At [42].

[8] House v The King (1936) 55 CLR 499 at 505 per Dixon, Evatt and McTiernan JJ.

[9]  Sentencing Act (NSW), s 3A.

[10]  Sentencing Act (NSW), s 21A.

[11]  (2005) 228 CLR 357; [2005] HCA 25.

[12]  At [30], [31].

[13]  Exhibit 3: AB24-28.

[14]  In oral submissions, the applicant submitted that Buchner was a sub-contractor, and not an employee, of BOQ.

[15]  In oral submissions, the applicant said that he had worked with Buchner for nine months at BOQ Mitchelton.  The applicant was several years older than Buchner.

[16]  In oral submissions, the applicant submitted that it was not “completely true” that Auswealth had no employees.  He said that all of his companies had had employees.  However that may be, Mr Radford was never one of them.

[17]  In oral submissions, the applicant said that his wife had ceased to be a signatory by then and that Mr Radford had become a signatory so that he could access the account if the applicant was overseas.

[18]  AB17 ll15-20.

[19]  AB13; Tr 1-6 l1.

[20]  AB14; Tr 1-7 l3.

[21]  Ibid ll9-10.

[22]  AB17 l14; AB18 l32.

[23]  [2011] QCA 115.

[24]  [2014] QCA 189.

[25]  At [43].

Close

Editorial Notes

  • Published Case Name:

    R v Kelly

  • Shortened Case Name:

    R v Kelly

  • MNC:

    [2018] QCA 307

  • Court:

    QCA

  • Judge(s):

    Sofronoff P, Gotterson JA, Ryan J

  • Date:

    09 Nov 2018

Litigation History

Event Citation or File Date Notes
Primary Judgment DC1924/17 (No Citation) 01 Dec 2017 Date of Sentence (Martin SC DCJ).
Appeal Determined (QCA) [2018] QCA 307 09 Nov 2018 Leave to appeal against sentence granted; appeal against sentence dismissed: Sofronoff P and Gotterson JA and Ryan J.

Appeal Status

{solid} Appeal Determined (QCA)