The Queen v McCullough and Singh
[1998] QCA 226
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- The Queen v McCullough and Singh[1998] QCA 226
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The Queen v McCullough and Singh[1998] QCA 226
The Queen v McCullough and Singh[1998] QCA 226
IN THE COURT OF APPEAL
SUPREME COURT OF QUEENSLAND
C.A. No. 73 of 1998
C.A. No. 108 of 1998
Brisbane
[R. v. McCullough & Singh]
THE QUEEN
v.
BRIAN WILLIAM McCULLOUGH
and
JAG JIT SINGH
(Applicants) Appellants
Davies J.A.
Demack J.
Helman J.
Judgment delivered 14 August 1998
Separate reasons for judgment of each member of the court, all concurring as to the orders made.
APPEAL AGAINST McCULLOUGH’S CONVICTIONS ON COUNTS 2 AND 18 ALLOWED, CONVICTIONS ON THOSE COUNTS QUASHED AND A DIRECTION GIVEN THAT JUDGMENTS AND VERDICTS OF ACQUITTAL BE ENTERED. APPEAL AGAINST McCULLOUGH’S CONVICTIONS ON COUNTS 1, 3 TO 6 INCLUSIVE, 9 TO 15 INCLUSIVE, 17, 19, 21, 23, 24, 30, AND 32 TO 36 INCLUSIVE ALLOWED, CONVICTIONS AND VERDICTS OF GUILTY ON THOSE COUNTS SET ASIDE AND A NEW TRIAL ORDERED ON THOSE COUNTS.
APPEAL AGAINST SINGH’S CONVICTIONS ON COUNTS 2, 8 AND 18 ALLOWED, CONVICTIONS ON THOSE COUNTS QUASHED AND A DIRECTION GIVEN THAT JUDGMENTS AND VERDICTS OF ACQUITTAL BE ENTERED. APPEAL ON REMAINING COUNTS DISMISSED. SINGH’S APPLICATION FOR LEAVE TO APPEAL AGAINST SENTENCE REFUSED.
CATCHWORDS: CRIMINAL - fraud - appeals against convictions - whether jury verdicts unsafe and unsatisfactory - whether sentence imposed manifestly excessive - trial miscarried.
s 427 Criminal Code
s 29A Crimes Act 1914 (Cth)
Counsel: Mr R.S. Toner S.C. for the applicant/appellant, McCullough
Mr G. Long for the applicant/appellant, Singh
Mr M.C. Chowdhury for the respondent
Solicitors: Crichton Browne Gossley for the applicant/appellant, McCullough
Legal Aid Queensland for the applicant/appellant, Singh
Director of Public Prosecutions (Queensland) for the respondent
Hearing date: 25 June 1998
REASONS FOR JUDGMENT - DAVIES J.A.
Judgment delivered 14 August 1998
I agree with the reasons for judgment of Helman J. and with the orders he proposes.
REASONS FOR JUDGMENT - DEMACK J.
Judgment delivered 14 August 1998
I have had the advantage of reading the reasons of Helman J. I agree with his Honour’s conclusion that Singh’s appeal should be allowed in respect of his conviction on counts 2, 8 and 18, for the reasons he has given. I also agree that Singh’s application for leave to appeal against sentence should be refused for the reasons his Honour has given.
In respect of McCullough, I agree with Helman J. that the convictions cannot stand. I have been concerned about ordering a new trial. This was a case where there was properly a joint trial and a fair re-trial of McCullough alone on only some of the charges on the original indictment will be difficult. However, that is really a matter for the Director of Public Prosecutions, so I agree that a re-trial should be ordered.
REASONS FOR JUDGMENT - HELMAN J.
Judgment delivered 14 August 1998
On 6 March this year, after a joint trial which began just under a month before on 9 February, each appellant, having pleaded not guilty to all charges against him, was found guilty and convicted of a number of offences under s. 427 of the Queensland Criminal Code of inducing the delivery of money by a false pretence and offences under s. 29A of the Crimes Act 1914 (Cwth) of false pretence to a public authority under the Commonwealth, the Commonwealth Development Bank of Australia. The indictment contained thirty-six counts: 1 to 33 inclusive alleged the State offence, and 34 to 36 inclusive the Commonwealth offence. In the course of the trial the Crown entered a nolle prosequi in relation to each of counts 20, 22, and 29. Singh was convicted on counts 1 to 6 inclusive, 8 to 19 inclusive, 21, 23 to 27 inclusive, and 30 to 36 inclusive; and he was acquitted on counts 7 and 28. McCullough was convicted on counts 1 to 6 inclusive, 9 to 15 inclusive, 17 to 19 inclusive, 21, 23, 24, 30 and 32 to 36 inclusive; and he was acquitted on counts 7, 8, 16, 25 to 28 inclusive, and 31. McCullough was then acquitted on all of the counts on which Singh was acquitted, but in addition was acquitted on counts 8, 16, 25 to 27 inclusive, and 31. There was a third person brought to trial with Singh and McCullough, Ronda Weidmann. At the direction of the learned trial judge after the close of the Crown case she was acquitted on all counts on which she was charged.
On each count on which Singh was convicted, with the exception of counts 18, 19, 21, 23, and 24, he was sentenced to imprisonment for five years, and on the five counts I have mentioned to imprisonment for three years to be served cumulatively on the sentences of five years. His Honour set a non-parole period of four years for counts 34 to 36 inclusive.
On each count on which McCullough was convicted he was sentenced to imprisonment for five years. His Honour set a non-parole period of two and a half years for counts 34 to 36.
Each appellant had been in custody for thirteen days, and his Honour declared the thirteen days to be time served under the sentences.
Singh’s appeal, as it proceeded before us, did not relate to all counts on which he was found guilty and was confined to counts 2, 3, 8 to 11 inclusive, 13 to 16 inclusive, 18, 21, 25, 26, 30, 33, and 35. The only ground argued was that the verdicts on those counts were unsafe and unsatisfactory. In addition, he sought leave to appeal against the sentences imposed upon him on the ground that they were manifestly excessive.
McCullough’s appeal relates to all counts on which he was found guilty. It was argued on two original grounds: that the verdicts were unsafe and unsatisfactory, and that his trial miscarried when his Honour ruled against the reception of evidence it was sought to lead on his behalf. At the hearing of the appeals the Court gave McCullough leave to add a further ground of appeal and an application for leave to appeal against the sentences imposed upon him. The new ground of appeal was to the effect that if both appellants had been convicted on a count and Singh's conviction on that count were to be quashed, McCullough's conviction should be quashed too, since the case against McCullough on each count was that he aided Singh in committing the offence alleged. The validity of that ground was conceded by the Crown. It is not necessary to consider the application for leave on the view I take as to the second of the original grounds.
Neither appellant makes any complaint about his Honour’s summing-up.
The charges against the appellants arose out of dealings from March 1988 to March 1991 between Singh and finance companies and the bank. The finance companies referred to in the indictment were Household Financial Services Limited, as it has been called since 25 January 1990 (counts 1 to 17 inclusive), A.G.C. (Industrial) Limited (counts 18, 20, 21, 23, and 24), Australian Guarantee Corporation Ltd (counts 19 and 22), and Custom Credit Corporation Limited (counts 25 to 33 inclusive). Counts 34 to 36 inclusive concerned dealings with the bank.
Singh was at the relevant time a director of a company called Bribie Bricks Pty Limited which manufactured bricks and pavers at Ningi north of Toorbul, Queensland. He was also a director of an associated company called Development Co-ordination Pty Limited. Ms Weidmann was the administration manager of Bribie Bricks at the relevant time and a director of Development Co-ordination for some of the relevant time. McCullough was a director of a company called Superior Machinery Imports Pty. Ltd., which imported and sold industrial machinery. Its principal place of business was in New South Wales near Sydney. The Crown allegation was that Singh, aided by McCullough, induced the finance companies and the bank to pay various sums of money to Superior Machinery Imports by falsely pretending that Superior Machinery Imports had agreed with Bribie Bricks that it would deliver industrial machinery of various kinds to Bribie Bricks. On four counts (19, 25, 35, and 36), the Crown case, as it was put to the jury, was that the machinery did exist but had been acquired from other suppliers and was never sold to Superior Machinery Imports for re-sale. On the remaining counts the Crown case, as it was put to the jury, was that the machinery did not exist. In reliance on invoices sent to them by McCullough the finance companies and the bank paid Superior Machinery Imports for the machinery. Superior Machinery Imports then transferred sums equal to those it had received to one of Singh’s companies or to an account in the name of A.E., J.A., & N.R.C. Singh. Lease agreements in respect of the relevant machinery were entered into between the finance companies and Bribie Bricks. Hire-purchase agreements in respect of the relevant machinery were entered into between the bank and Bribie Bricks.
The reasoning behind the way in which the Crown case was put on each of counts 19, 25, 35, and 36 appears to have been that proof of acquisition from another supplier showed, in the circumstances, that there had been no genuine agreement between Superior Machinery Imports and Bribie Bricks as to the delivery of the machine in question and so the representation that there had been such an agreement was false.
The reasoning behind the way in which the Crown case was put on each of the counts other than the four I have just mentioned appears to have been that proof that the machinery in question did not exist showed, in the circumstances, that there had been no genuine agreement between Superior Machinery Imports and Bribie Bricks as to the delivery of the machine in question and so the representation that there had been such an agreement was false. It followed that it was common ground at the trial, and before us, that if, on a count other than the four, there was reasonable doubt concerning the non-existence of the machine, the Crown case must fail.
The object of the alleged frauds was to obtain funds for Bribie Bricks and Development Co-ordination because each was in financial difficulties. Singh represented that the business of the brickworks was expanding and that new equipment was needed to enable production to be increased. Each finance company and the bank required invoices from the supplier of the machinery before the transactions could be completed.
In April 1991 the National Australia Bank, a secured creditor of Bribie Bricks owed $4,742,000.00, appointed a chartered accountant, Mr John Ebbage, receiver and manager of Bribie Bricks to realize its assets. Mr Ebbage engaged Premier Auctions Pty Ltd to list and value the machinery at the brickworks. Mr Dean Brodie, an employee of Premier Auctions, undertook the task and, according to his account, discovered that most of the machinery the subject of the leases and the hire-purchase agreements was not on the site.
The Crown relied on circumstantial evidence. It placed particular reliance on the evidence of Mr Brodie and that of Mr Wayne Wallace, who had been employed at the brickworks for part of the relevant period.
Singh did not give evidence at the trial but McCullough did. The latter admitted the invoices had been sent on his authority by Superior Machinery Imports to the finance companies and the bank, but claimed that he did not know at any relevant time that the scheme was a fraudulent one. He said his brother Robert, a chartered accountant, had first approached him on behalf of Singh, a client, and he had agreed to participate in the scheme as a favour to his brother, whom he trusted. He had believed, he said, that Superior Machinery Imports was purchasing the machinery from Development Co-ordination and then “on-selling” it to “the finance company”. The purpose, as he said he understood it, was to comply with the requirement of the finance company that the machinery come from “a third party or independent source” - i.e., not Bribie Bricks or, it appears, an associated company. McCullough said he would have been prepared to take part in the scheme for no payment, but in fact he received fees, which came to less than $30,000.00, “over the total period”. McCullough was cross-examined at length by the Crown Prosecutor Mr Chowdhury, who also appeared before us for the Crown. Mr Chowdhury concluded his cross-examination by suggesting that McCullough’s evidence was completely false, which suggestion McCullough rejected. It is clear from the jury’s verdicts, however, that it did not accept substantial parts of McCullough’s evidence.
I shall deal first with Singh’s ground of appeal.
Singh was convicted on thirty-one counts involving a total sum of $3,844,800.00. He complains about seventeen of his convictions. With the exception of the convictions on counts 25 and 35, the convictions about which he complains were on counts on which the Crown case was that the machine in question did not exist. In relation to each of those fifteen counts Mr Brodie’s evidence was that his inspection did not reveal the presence of the machine. He said he went over the site “half a dozen times”. If he could find a serial number he would make a note of it. The essence of Mr Long’s principal submission on behalf of Singh on the fifteen counts was that other evidence in the case showed that the verdicts on those counts were unreasonable and cannot be supported having regard to the evidence.
It is important to observe that each of the invoices showed a serial number or a model number and that, except in one instance, Mr Brodie failed to find the numbers shown on the invoices relevant to the fifteen counts. The one exception was in the case of the invoice relevant to count 18.
Mr Long made a number of general criticisms of the evidence of Messrs Brodie and Wallace in connexion with the fifteen counts: that although Mr Brodie had Mr Wallace’s assistance Mr Brodie had had no previous experience in dealing with brickworks machinery; that it was difficult to find numbers on dirty machinery; that Mr Brodie had listed “a quantity of scrap metal” without further description among the things found at the brickworks; that replacement and repairs caused difficulties in identifying machinery; that there were unexplained discrepancies between Mr Brodie’s assets list and the invoice relating to the receiver’s sale of the assets of the brickworks, the latter showing things not on the former; and that there was uncertainty on the evidence as to when Mr Wallace began work at the brickworks.
Mr Long also made a number of specific criticisms of the Crown case on the fifteen counts.
Counts 2, 3, 8, 9, 10, 11, 13, 14, 15, and 16 all related to payments made by Household Financial Services, whose representative Mr Ross McLeod, Mr Long pointed out, gave evidence that he had visited the brickworks and Singh had shown him machinery which matched the description of the leased machinery. Mr McLeod did not, however, check for serial numbers or model numbers, as Mr Brodie did.
There was, as Mr Long also mentioned, evidence from Messrs Brodie and Wallace and others that machinery of the kinds referred to in the invoices was on the site. In that category was the following evidence: that of Messrs Brodie and Wallace concerning motors (counts 3, 13 and 30); that of Messrs Brodie and Wallace concerning burners (counts 9 and 11); that of Mr Ronald Rye, a former employee at the brickworks, concerning a CMC forklift (count 10); that of Messrs Wallace, Roderick Kilborn a consulting engineer, and Leslie Hastie another former employee at the brickworks, concerning a brick drying plant (count 14); that of Messrs Brodie and Wallace concerning primary clay crushing plants (counts 15 and 21); and that of Messrs Brodie and Wallace concerning clay separation plants (counts 16 and 33).
Count 10, as I have mentioned, concerned a CMC forklift. Its model number was specified on the Superior Machinery Imports invoice, which was dated 14 February 1990. Count 26 concerned another forklift, a Lancing, the model number of which was specified on the Superior Machinery Imports invoice, dated 1 March 1988. On behalf of Singh some reliance was placed upon Mr Brodie’s accepting that he had made a note that the life of a forklift on the site was under twelve months. Mr Brodie presumed that that information had come from Mr Wallace. The suggestion made on behalf of Singh is then that Mr Brodie’s failure to find the forklifts can be explained by the short life of those machines. It may be observed first that the evidence of what Mr Wallace may have told Mr Brodie is hearsay, and secondly that even if the machines had worn out they should still have been at the brickworks since they were, on the appellant’s cases, still the property of the finance companies. In cross-examination Mr Wallace said, however, that the life of a forklift was over twelve months and that he did not recall saying to anyone that their life was under twelve months. He agreed they had a “pretty hard life”, but added that they “used to break down and get repaired”.
Counts 2, 7, 8, 18, and 28 related to machinery described in the invoice in each case as an “impactor”: counts 2 and 28 vertical impactors, 7 and 8 steel impactors, and 18 clay refining impactor. As I have mentioned, the appellants were acquitted on counts 7 and 28. Mr Brodie said he found three “hammer crushing mills”, one with the serial number 90911, at the brickworks.
The machine relevant to count 18 had, according to the invoice which was dated 22 May 1990, the serial number 90911. The relevant finance company was A.G.C. (Industrial), an employee of which, Mr Allan Gamack, gave evidence that he had inspected the machine, checked its serial number, and was satisfied that it was at the brickworks. Mr Gamack’s evidence was, however, of suspect credibility on that matter since he gave similar evidence about the machinery relevant to count 19, a circular clay cutting machine, not found by Mr Brodie and the serial number of which was, according to other evidence, fictitious. (Singh does not challenge his conviction on count 19.)
Mr Wallace gave evidence that two hammer mills were in operation when he began work at the brickworks, another was delivered after he began work, and four to six old ones not in use were “down the back”.
A question of terminology arose in connexion with the “impactors”: Mr Wallace said that the terms “vertical impactor” and “steel impactor” were not used at the brickworks, and that “vertical impactor” could have referred to either a “hammer mill” or to a “brick press”. Mr Wallace also said, having looked at the invoice relating to count 2 the full description of the machinery on which was “1 only clay refining IMPACTOR fitted with hammers, starters, motors, plant room equipment complete”, that he thought that it referred to a brick press. A resort to dictionary definitions does not solve the problem of terminology: the Oxford English Dictionary (2nd ed., 1989) gives “[a] device or machine that delivers impacts or blows” as the primary meaning of “impactor”, and “the striking of one body against another” as a meaning of the noun “impact”, and “[t]o press closely into or in something” as a meaning of the verb “impact”. Mr Wallace was, however, asked in cross-examination whether the hammer mills “operated in an impacting way”, and he agreed they did. Describing their operation he said that the clay went in at the top of a big cylinder which was armour plated on the inside and which spun around at high speed. There were thirty lever-mounted hammers which shredded the clay, which came out at the bottom of the cylinder.
On my assessment the verdict on count 18 was unreasonable and cannot be supported having regard to the evidence: first because Mr Wallace’s description of a hammer mill and the way it worked could apply to a clay refining impactor, and secondly because Mr Brodie found a machine at the brickworks with the relevant serial number. Had Mr Gamack’s evidence of suspect credibility been the only evidence on the subject of the serial number I should not have reached the conclusion I have on count 18. It is Mr Brodie’s evidence about the serial number which is the most important factor in deciding the issue on the appeal concerning that count, in my view. In cross-examination Mr Brodie agreed, concerning the machine with the serial number 90911, that Mr Wallace had told him “that the mill was put on site for insurance purposes approximately eight months ago”, i.e., eight months before Mr Brodie’s inspection. The date of the invoice was before that, 22 May 1990. A written submission on behalf of the Crown was that the jury was entitled to have regard to that evidence, but of course it was hearsay. In oral submissions Mr Chowdhury said that on count 18 the Crown’s submission was essentially that it was open to the jury to conclude that the machine in question was not the machine found by Mr Brodie because of the “difference in terminology”. Those considerations are not sufficient I think to overcome the difficulty for the Crown case inherent in Mr Brodie’s evidence of finding a machine with the relevant number which, though described by Mr Brodie as a hammer mill, could as accurately be described as an impactor.
Giving full weight to Mr Long’s criticisms, both general and specific, of the evidence on the fifteen counts, I am not persuaded that a comparison of the quality of the evidence which could have cast doubt on the jury’s conclusions that the machinery had not existed with the quality of the evidence relied on by the Crown, and in particular Mr Brodie’s evidence, leads to the conclusion that the verdicts on the fourteen counts other than count 18 were unreasonable or cannot be supported having regard to the evidence. True it is that there was evidence that Mr Brodie lacked experience in dealing with brickworks machinery, that it was difficult to find numbers on dirty machinery, that there were discrepancies between Mr Brodie’s assets list and the invoice relating to the receiver’s sale, that Mr Ross McLeod made some attempt to check for machinery apparently sold to Household Financial Services, that there was machinery of the kinds referred to in the invoices on the site, and that forklifts did not remain in service long. But against that evidence was that of Mr Brodie’s careful examination of the site. It was not a cursory examination, he went over the site six times, he said. If he could find a serial number - and one may safely assume a model number - he made a note of it. Mr Brodie’s evidence about the “scrap metal” bears out, I think, the assessment of his evidence I have just mentioned. It was true that Mr Brodie had listed “a quantity of scrap metal” without further description. He said that it was a “big, big pile of scrap”, about the contents of which he could not be specific, but he said also that he and others did examine it to see if there was anything there that might have “pertained” to any of the leases.
That completes my consideration of Mr Long’s principal submission on behalf of Singh on the fifteen counts.
There were two further submissions on the fifteen counts and the other counts the subject of Singh’s appeal: first, that Singh’s convictions on counts 2, 8, and 18 and his acquittals on counts 7 and 28 cannot be explained by logic or reason; and secondly, as Mr Long put it in his written submissions, “in the event that the additional verdicts of acquittal of the accused McCullough cannot be rationalised on the basis of factors peculiar to his case this is also a factor which would contribute to a doubt about these [i.e., Singh’s] convictions”. Those submissions were not confined to the fifteen counts, but it is convenient to deal with them now. It is also convenient that I mention here that the force of the first submission is confined to the verdicts on the impactors: there is no proper basis for concluding that any inconsistency of verdicts concerning impactors shows the verdicts of guilty on counts not concerning impactors to have been miscarriages of justice. I should also mention that in my view there is no merit in the second submission. I shall explain why when I come to McCullough’s appeal.
The verdicts on counts 7 and 28 show there the jury was not persuaded of the non-existence of two of the impactors: one steel impactor (count 7, the date of the relevant invoice being 28 November 1989) and one vertical impactor (count 28, the date of the relevant invoice being 27 May 1988). But how did they select those two counts over counts 2 and 8 (the dates of the relevant invoices being 5 September 1989 and 2 January 1990)? It cannot have been because of identity of description because the four impactors fall into two groups by description, two vertical impactors (counts 2 and 28) and two steel impactors (counts 7 and 8), and the jury acquitted on one count in each group. Count 18 of course had a third description: clay refining impactor. If the jury concluded, in spite of Mr Wallace’s evidence concerning the invoice relating to count 2, that what was described was a hammer mill it could have concluded that the machines on counts 7 and 28 were two of the three hammer mills of which Mr Wallace spoke. But why only two out of the three? And how was a distinction made between counts 2 and 28 on the one hand and counts 7 and 8 on the other? The chronological order (28, 2, 7, 8 and 18) does not provide any clue because the first and the third were selected for acquittal, prompting one to question why the second was rejected in favour of the third. Explanation is rendered no less difficult if one assumes the jury accepted Mr Wallace’s evidence concerning the invoice relating to count 2. There was nothing to distinguish the facts relevant to counts 7 and 28 from the facts relevant to counts 2 and 8. The evidence in relation to count 18 of course had the added feature of Mr Brodie’s finding a machine with the relevant serial number.
The test is one of logic and reasonableness in a case where there is alleged to be an inconsistency in jury verdicts on counts on an indictment: see Mackenzie v. R. (1996) 141 A.L.R. 70 at p. 83 per Gaudron, Gummow and Kirby JJ. Since there is no logical or reasonable explanation for the inconsistencies of outcome between counts 7 and 28 on the one hand and the other counts concerning impactors on the other, the verdicts on counts 2 and 8 must I conclude be regarded as having been miscarriages of justice.
Counts 25 and 35, the two remaining counts for consideration in connexion with Singh’s appeal against convictions, concerned a Leyland truck and an extruder plant respectively.
The invoice concerning the truck from Superior Machinery Imports to Custom Credit was signed by McCullough and was dated 17 May 1988. It showed the truck as mounted “with brick tray and brick crane fully fitted for brick cartage”. The price was $87,000.00 and a registered number and an engine number were shown. The same truck was, according to the evidence of Mr Anton Weil, who in 1988 was a salesman employed by Northside Truck Sales, sold by the latter on 17 May 1988 to Bribie Bricks for $18,000.00 and delivered on 23 May 1988 fitted, at the request of the purchaser, with an aluminium tray, not a brick tray. On 19 May 1988 McCullough sent a Superior Machinery Imports facsimile message to Mr John Schneider, then a commercial lending officer employed by Custom Credit, confirming “THE DETAILS OF THE BRIK LIFTING CRANE MOUNTED ON THE LEYLAND TRUCK FOR BRIBIE BRICKS” and the details then followed. Mr Wallace gave evidence that there had been a “brick truck” at the brickworks with a crane fitted to it, although he could not remember the brand of the truck. Mr Brodie did not find a Leyland truck with a brick crane in the possession of Bribie Bricks, although a carrier’s Leyland truck was at the brickworks. What at least seems clear from the evidence is that the Leyland truck was acquired from Northside Truck Sales without a brick tray or crane when delivered, and that the truck had not been delivered to Bribie Bricks when McCullough sent the invoice from Superior Machinery Imports and when the facsimile transmission was sent to Custom Credit. The price of $87,000.00 when compared with the $18,000.00 appears grossly inflated, but it could be explained by the addition of the brick tray and crane. It is possible that those modifications were made after 23 May, but the combined effect of the invoice and the facsimile transmission was to represent to Custom Credit that they had been made at least by 19 May.
It was clearly reasonably open to the jury to find that there had not been a genuine transaction between Superior Machinery Imports and Bribie Bricks but merely a sham designed to defraud Custom Credit by falsely representing that the true source of the truck with a brick tray and crane was Superior Machinery Imports on or about 19 May 1988.
The invoice from Superior Machinery Imports to the bank concerning the extruder plant, which was manufactured in the United States, was dated 31 May 1989 and showed a purchase price of $220,000.00, less a deposit of $22,000.00. On 1 June 1989 an invoice concerning the extruder plant was sent to Superior Machinery Imports by Development Co-ordination showing a price of $220,000.00, less a deposit of $22,000.00. On or about 7 June 1989 the bank paid $198,000.00 to Superior Machinery Imports, which then on 9 June 1989 sent $198,000.00 by telegraphic transfer to Development Co-ordination. Mr Brodie found the extruder plant at the brickworks. It was second-hand and had been sold by a company called Alexelen Pty Ltd to Bribie Bricks on 31 May 1989 for a total price of $110,000.00 in situ, the machine being at Enfield, New South Wales. It was taken on two trucks to the brickworks at Ningi. Mr John Seward, formerly the managing director of Seward Nominees Pty. Ltd., which among other things sold machinery imported from the United States to the brick industry, was asked whether $220,000.00 “would represent a fair price” for a second hand machine of the type in question. Mr Seward replied “Yes, it may be”.
While there would no doubt have been expense incurred in moving the plant from Enfield to Ningi and further expense in installing it and while $220,000.00 could have been a fair price for it, the evidence clearly enough leaves open the reasonable conclusion that the agreement referred to in the invoice sent to the bank was a sham designed to defraud the bank by falsely representing that the true source of the machinery had been Superior Machinery Imports.
For those reasons Singh’s appeal should be allowed in respect of his convictions on counts 2, 8, and 18. His convictions on those counts should be quashed and a direction given that judgments and verdicts of acquittal be entered. His appeal should otherwise be dismissed.
It follows that McCullough's appeal should also be allowed in respect of his convictions on counts 2 and 18. His convictions on those counts should be quashed and a direction given that judgments and verdicts of acquittal be entered.
The arguments relied on in support of Singh’s application for leave to appeal against his sentences were that his Honour, in particular in failing to recommend that Singh be eligible for release on parole before he had served four years, gave inadequate consideration to Singh’s age and ill-health and no consideration to the delay in prosecuting the case against him. On the question of Singh’s age we were referred to R. v. S (C.A. no.373 of 1997, 20 March 1998, unreported), and on the question of delay to R. v. Law, ex parte Attorney-General [1996] 2 Qd.R. 63. Singh was born on 27 December 1933 and so is sixty-four years old. There was some delay in prosecuting the case: he was first spoken to by investigating police officers in 1991 and was not committed for trial until 1996. McCullough’s committal in 1997 caused further delay.
In sentencing Singh his Honour observed that “white collar” crime is difficult to detect and the costs to the community are great, that Singh had engaged in a carefully calculated fraud involving substantial sums of money over a considerable period, and that the deterrent aspect of the punishment could not be overlooked. His Honour said that he took into account Singh’s age, the fact that Singh “enjoyed a previous good character”, and the references that had been produced to the court. His Honour also referred to Singh’s ill-health and recommended that a doctor’s report that had been tendered be made available to the prison authorities.
Sentences in comparable cases indicate that a sentence of imprisonment for eight years was within the sentencing range for a fraud of the magnitude in question. I include in the category of comparable cases those of obtaining or inducing the delivery of money by wilfully false promises and of misappropriation. Some allowance must of course be made for the greater maximum penalty applicable to misappropriation with a circumstance of aggravation than to the offences of which Singh was convicted.
In R. v. Heiser and Cook, ex parte Attorney-General (C.A. nos. 506, 507 and 513 of 1996, 4 March 1997, unreported) Attorney-General’s appeals against sentences imposed on respondents who had misappropriated in excess of $3,300,000.00 over about ten months were considered. The respondents had been found guilty after a trial which took about three weeks. The money misappropriated had come to Cook and Heiser as chairman and secretary respectively of a friendly society. Cook was treated as the instigator of the offences. The Court of Appeal allowed an appeal against Cook’s total punishment of imprisonment for nine years on thirty-nine counts of inducing the delivery of money by wilfully false promises and two counts of misappropriation of property with circumstances of aggravation and substituted imprisonment for twelve years. Cook, who was about fifty-eight years old, had no relevant criminal history. The court also allowed an appeal against Heiser’s total punishment of imprisonment for three years on thirty-four counts of inducing the delivery of money by wilfully false promises and two counts of misappropriation of property with circumstances of aggravation and substituted imprisonment for seven years. Heiser was about forty-eight years old. He too had no relevant criminal history, but it was accepted that he received substantially less than Cook from the proceeds of the offences and had good prospects of rehabilitation. No recommendations were made by the Court of Appeal concerning parole for either Cook or Heiser.
R. v. Hinterdorfer (C.A. no. 118 of 1997, 29 May 1997, unreported) was a case of misappropriation of $4,500,000.00 of an employer’s funds by a clerk. He pleaded guilty on an ex officio indictment, had no prior criminal history, and was thirty-four years old. A sentence of imprisonment of ten years with a recommendation for consideration of parole after imprisonment for four years was imposed by the sentencing judge. An application for leave to appeal against sentence was refused.
We were referred to other cases, but there is little to be gained by multiplying such references. The two I have mentioned were recent instances of particular relevance involving sums comparable to that in this case. In addition, the similarity of Cook’s age to Singh’s is striking.
Giving full weight to Singh’s age and the delay in proceeding against him I am not in the least persuaded that the sentence imposed on him was excessive. Nor do I think there is any proper cause for complaint concerning a recommendation in relation to parole. Any factors in his favour were reflected in the sentences; further leniency would have been quite unjustifiable. It is true that his Honour did not expressly mention delay in his sentencing remarks, but that does not lead me to conclude that he failed to take it into account in sentencing Singh. Little can be made of the delay in any event because, obviously enough, frauds of the kind Singh was guilty of clearly take a long time and much effort to expose. There was the added complication in this case of the need to investigate McCullough’s actions. The reduction of the total sum involved in Singh’s fraudulent conduct brought about by his successful appeals on counts 2, 8, and 18 ($89,000.00, $75,000.00, and $195,000.00 respectively: in all $359,000.00) makes no material difference in my view. His application for leave to appeal against the sentences remaining for consideration should be refused.
In support of the first of McCullough’s original grounds of appeal, which remain relevant to his convictions on counts other than 2 and 18, it was argued that there was such inconsistency in the verdicts returned in relation to him as to show all of the verdicts of guilty against him were miscarriages of justice. He was convicted on twenty-five counts involving a total sum of $3,312,800.00. Mr Toner S.C., who appeared for McCullough before us and at the trial, submitted that there was no logical or reasonable explanation for his client’s convictions on those counts and his acquittals on counts 8, 16, 25 to 27, and 31. It was never the Crown’s case, Mr Toner argued, that McCullough’s honesty, or dishonesty, was divisible: the Crown case was that McCullough knowingly took part in a dishonest scheme and that each transaction in question was a part of that scheme.
There was no difficulty, Mr Toner conceded, in explaining his client’s convictions and the outcomes on counts 7 and 28, on which both appellants were acquitted, because it appears the jury was not satisfied beyond a reasonable doubt, when deliberating on the evidence on counts 7 and 28, that the machinery in question did not exist. It followed that Singh the principal offender was acquitted, and so was McCullough since the case against McCullough was that he aided Singh in the commission of the offences. Count 8 and the other five are, however, in a different category.
The offences alleged in counts 25 to 27, and 31 were the first in time, having been committed, so it was alleged, on or about 3 March 1988 (count 26), on or about 23 May 1988 (count 25), on or about 3 October 1988 (count 27), and on or about 26 November 1988 (count 31). The only other offence on the indictment allegedly committed in 1988 was that charged in count 28, on or about 3 August 1988, but both accused were acquitted on that count. A logical and reasonable explanation for McCullough’s acquittal on those four counts and his convictions on counts of offences committed later is that the jury concluded that there was a doubt as to whether McCullough was aware of the fraudulent nature of the scheme at the beginning of his participation in it, but was satisfied he became aware of it later.
Part of the evidence relevant to count 8, in which an offence committed on or about 8 January 1990 was alleged, was a letter from Singh to McCullough dated 2 January 1990 which included the following:
“Brian, could you pl. forward the attached re-drafted a/c to HFC Brisbane via Fax urgently - FAX No 07 832 3010 & fwd the orig. to us at Bribie as soon as possible. We managed to get a similar machine for lesser cost and wd. be excellent one for standby. Regards, Jack Singh”.
The particulars in that letter could have led the jury to conclude that there was merit in the proposition that McCullough believed that the machinery the subject of count 8 did exist, and so the jury was in reasonable doubt as to his guilt on that count, while it was free of such doubt on other counts in respect of which there was no such evidence.
The explanation for McCullough’s acquittal on count 16 suggested by Mr Chowdhury was that the invoice in question was not signed by McCullough but rather by a D.G. McCullough, McCullough’s wife Dorothy. That fact, which Mr Chowdhury observed seemed to have been overlooked by all counsel at the trial, could well have led the jury to acquit McCullough on that count since it could appear doubtful that he was involved in aiding Singh in committing that offence, whereas the evidence showed with greater certainty his complicity in other offences. In my view there is merit in that submission.
In the result I am not persuaded that there is any substance in the first of McCullough’s original grounds of appeal.
The second of the original grounds of appeal relied on by McCullough was as follows:
“His Honour the Learned Trial Judge erred in refusing to permit the appellant to cross-examine various witnesses and tender various documents in relation to transactions other than those contained in the charges on the basis that the effect of such cross-examination would unfairly prejudice the case of the co-accused, even though the material was relevant and potentially favourable to the appellant’s case.”
As the ground was argued before us it was confined to a ruling on evidence given by his Honour after the close of the Crown case and before McCullough’s evidence was opened to the jury.
His Honour heard submissions concerning evidence Mr Toner proposed to elicit from his client concerning dealings his client had had with Singh pursuant to the scheme but which were not the subject of charges before the jury. Those dealings were some of seven or eight transactions which had been the subject of charges upon which McCullough had been tried and acquitted in New South Wales. The purpose of proposing to call the evidence was not of course to put before the jury the fact of the acquittals but rather to reinforce, from evidence of things said by Singh to McCullough concerning the transactions, McCullough’s case that he had been the victim, at the relevant time, of a “pattern .. of persuasion” devised by Singh. According to McCullough’s case, Singh had in those instances, as he had in the transactions which gave rise to the charges before the court, convinced McCullough that the latter was dealing with a substantial company engaged in a legitimate enterprise which was expanding. The proper presentation of McCullough’s case to the jury, Mr Toner argued, required that the whole of his client’s association with Singh be revealed in the evidence: to confine the evidence to that part of the association which resulted in the transactions the subject of the charges would be artificial. There was, Mr Toner said, “a totality of transactions which played upon McCullough’s mind” which led to McCullough’s honestly believing he was engaged in legitimate transactions.
Mr Chowdhury objected to the evidence submitting it had at best marginal relevance. Mr Long, who appeared for Singh at the trial, was permitted to make submissions on the evidence. He urged his Honour to exclude it saying it was not relevant and referred to the possibility of its prejudicial effect on Singh’s case. In ruling on the question his Honour said he was not convinced that the proposed evidence was sufficiently cogent, having regard to the fact that it would create tremendous prejudice against Singh. His Honour added that he was not even certain that the evidence was admissible in any event so he would not permit it to be called. He added that he did not know what relevance the evidence had other than to improve a submission that Mr Toner would ultimately make that McCullough had been duped. It seemed, his Honour said, that Mr Toner could make that submission quite comfortably based on the evidence that McCullough was about to give concerning the matters before the court.
As the case proceeded McCullough gave evidence of a general nature about his association with Singh and specific evidence about the charges against him. It appears to me, however, that the proposed evidence was relevant and admissible: McCullough’s state of mind, whatever it was, concerning the transactions which gave rise to charges would have been formed as a result of all his dealings with Singh from the time his brother brought him into the scheme. To confine the evidence to the transactions resulting in charges was indeed artificial. I do not think, with respect to his Honour, that the evidence should have been excluded as lacking cogency. Its weight was for the jury to assess.
Any possible prejudice to Singh caused by the reception of the evidence was irrelevant in determining the question before his Honour. The judge has a well-recognized exclusionary discretion in a criminal trial, but only in respect of admissible Crown evidence. It does not extend to excluding admissible evidence an accused person proposes to call. It cannot be exercised in favour of one accused person in a joint trial to the detriment of a co-accused. In a joint trial rulings on proposed evidence against, or in favour of, an accused person must be decided as if the accused person is being tried alone and the case is confined to the issues between the Crown and that accused person.
In my view the exclusion of the evidence resulted in the miscarriage of McCullough’s trial. The evidence could have had the effect on the outcome on counts other than count 8 that similar evidence appears to have had in relation to count 8. I do not think there is any proper basis for applying s. 668E(1A) of the Criminal Code.
For those reasons I conclude that McCullough’s appeal against his convictions on counts 1, 3 to 6 inclusive, 9 to 15 inclusive, 17, 19, 21, 23, 24, 30, and 32 to 36 inclusive should be allowed, the convictions and the verdicts of guilty on those counts set aside, and a new trial ordered on those counts.