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R v Canuto[2017] QCA 281

 

SUPREME COURT OF QUEENSLAND

 

CITATION:

R v Canuto [2017] QCA 281

PARTIES:

R
v
CANUTO, James Gregorio
(appellant)

FILE NO/S:

CA No 324 of 2016

DC No 495 of 2015

DIVISION:

Court of Appeal

PROCEEDING:

Appeal against Conviction

ORIGINATING COURT:

District Court at Cairns – Date of Conviction: 15 November 2016 (Farr SC DCJ)

DELIVERED ON:

17 November 2017

DELIVERED AT:

Brisbane

HEARING DATE:

28 August 2017

JUDGES:

Sofronoff P and Gotterson JA and Boddice J

ORDER:

The appeal be dismissed.

CATCHWORDS:

CRIMINAL LAW – APPEAL AND NEW TRIAL – NEW TRIAL – IN GENERAL AND PARTICULAR GROUNDS – MISDIRECTION OR NON-DIRECTION – where the appellant was convicted by a jury of one count of fraud with a circumstance of aggravation – where the appellant was sentenced to four years’ imprisonment suspended after serving 18 months, for an operational period of four years – where the appellant appeals on the grounds that a failure to properly direct the jury as to the use of particular evidence has resulted in a miscarriage of justice – whether an Edwards direction should have been given by the trial judge

Edwards v The Queen (1993) 178 CLR 193; [1993] HCA 63, applied

R v Chang (2003) 7 VR 236; [2003] VSCA 149, applied

R v Mitchell [2008] 2 Qd R 142; [2007] QCA 267, cited

R v Nguyen (2001) 118 A Crim R 479; [2001] VSCA 1, applied

R v Roberts & Pearce [2012] QCA 82, applied

Zoneff v The Queen (2000) 200 CLR 234; [2000] HCA 28, cited

COUNSEL:

J J Allen QC for the appellant

D L Meredith for the respondent

SOLICITORS:

Legal Aid Queensland for the appellant

Director of Public Prosecutions (Queensland) for the respondent

  1. SOFRONOFF P:  I agree with the reasons of Boddice J and with the order his Honour proposes.
  2. GOTTERSON JA:  I agree with the order proposed by Boddice J and with the reasons given by his Honour.
  3. BODDICE J:  On 15 November 2016, the appellant was convicted by a jury of one count of fraud with a circumstance of aggravation.  He was sentenced to four years’ imprisonment, suspended after serving 18 months for an operational period of four years.
  4. The appellant appeals against his conviction on the grounds that a failure to properly direct the jury as to the use of particular evidence has resulted in a miscarriage of justice.  At issue on the appeal is whether an Edwards direction ought to have been given to the jury in relation to evidence given by one of the Crown witnesses, Mitchell Holmes.

Background

  1. At the time of the offence, the appellant was the Chief Executive Officer (“CEO”) of the Mutkin Residential and Community Aged Care Indigenous Corporation (“Mutkin”), a community based organisation.  Mutkin had responsibility for the operation of an aged care facility.  That facility was previously operated by the Yarrabah Shire Council.  The appellant had been manager of the aged care facility prior to the transfer of that facility by the Council to Mutkin in 2013.
  2. Mutkin was controlled by a board of directors.  It had a number of employees, in addition to the appellant.  Two of those employees were Nicola Louise Barlow and Kylie Ann Berriman.  On 29 July 2013, Mutkin funds were used to purchase three Toyota Land Cruiser motor vehicles for a total consideration of $251,643.80.  The registration for those vehicles was initially in Mutkin’s name.  The registration was transferred to the appellant, Barlow and Berriman respectively, shortly after their purchase by Mutkin.
  3. The board of directors of Mutkin became aware of the purchase and transfer of those vehicles.  The appellant was charged with having dishonestly taken funds from Mutkin to acquire the vehicles and to apply one of them to his own use.  The appellant denied any wrongdoing.  He asserted his vehicle was in payment of services rendered by him during the transfer of the ownership of the aged care facility from the Council to Mutkin.  He asserted the transfer of the vehicles was in accordance with the terms of the employment contracts between Mutkin and the appellant, Barlow and Berriman.

Trial

  1. The Crown case was that the employment contracts of the appellant, Barlow and Berriman were never approved by the board of Mutkin.  Accordingly, the appellant had no authority to obtain the motor vehicle.  The funds used by him to acquire the vehicle registered in his name were Mutkin funds to which he had no entitlement.  The appellant had therefore gained a benefit for himself by acquiring and applying the vehicle to his own use.
  2. The appellant did not give or call evidence at trial.  The defence contended all three employment contracts contained provisions that each employee would receive, by way of additional allowances, a motor vehicle chosen by the appellant which was gifted to the employee at the commencement of the contract “in lieu of services previously rendered” for contribution in the establishment of Mutkin.  That vehicle was to remain the property of the employee during and after termination of employment.
  3. Further, the defendant contended the appellant had authority to engage services of others in the transition process.  The vehicles were in lieu of unpaid services performed by him and those others.  The appellant contended the transaction was not dishonest and there was no intention to defraud Mutkin.  He honestly believed he was entitled to the vehicle in payment of services rendered in accordance with his authority and terms of employment.

Evidence

  1. Kathryn Hare became a member of the board of Mutkin in August or October 2012.  Mutkin had an interim Board from its incorporation on 10 August 2012.  Some of the directors of the interim Board were found not to have the required skill set.  The appellant asked her to apply to become a director.  She made application and it was accepted by the board.  She did not know whether the rule book process for her appointment was followed by the board.  The rule book provides the rules as to how Mutkin was to operate and function.
  2. Hare agreed the rule book required the directors to meet at least once a month.  The first meeting of directors she attended was on 10 August 2013, one year after Mutkin’s registration and 41 days after the transition of the facility to Mutkin.  Hare was not aware of any meetings of directors before that date.  It was attended by four directors, Michelle Watson, Cleveland Fagan, Leon Yeatman and herself.  Yeatman attended by telephone.  The chair of Mutkin, Drew Dangar, did not attend that first meeting.
  3. Hare agreed that pursuant to the rules, Mutkin’s business was to be managed by the directors, who have duties of care and diligence as well as a duty of good faith.  The directors could delegate their powers under the rules to a sub-committee, the CEO or another employee of Mutkin.  Mutkin’s primary business was the management and operation of the aged care facility, a large enterprise with approximately 28 or more staff.  The facility provided services to a large number of residents and members of the Yarrabah community.  It also had management of a number of vehicles.
  4. As a director of Mutkin, Hare had conversations with the appellant about various policies and procedures to be adopted once the aged care facility transitioned to Mutkin.  Those policies and procedures were never endorsed by the Mutkin board.  The directors also had input into the agenda for the first Board meeting.  The agenda was created by Watson.  Prior to that meeting, Hare had made requests of the appellant for financial information.  No such information was provided by the appellant.
  5. At the first board meeting, a number of items were addressed in accordance with that agenda.  Whilst the agenda referred to the current CEO contract the appellant’s contract was not discussed at the meeting.  There was no discussion at that meeting as to the terms and conditions upon which the appellant was currently engaged, apart from what the appellant asserted in his CEO report.  She agreed the appellant had not been appointed CEO by any resolution of Mutkin.
  6. Hare agreed the minutes of the first Board meeting recorded a description of the work performed by the appellant to appoint former Council staff.  The minutes also recorded the appellant had noted he was in a salaried position with Mutkin.  The appellant had no contract with Mutkin at that time.  No remuneration packages had been organised with the board.  The salaries remained the same as the current Council salaries with those remunerations to be reviewed by the remuneration committee established by the Board.
  7. The appellant also provided significant detail about the employment status of other employees of Mutkin.  The appellant indicated he had engaged employees on behalf of Mutkin.  There was no ratification of that action at the meeting on 10 August 2013.  In the appellant’s CEO report to the first board meeting, the appellant set out a long list of work undertaken by him to effect the transition of the facility from the Council to Mutkin’s control.  Hare did not know what hours the appellant had undertaken outside of his normal hours as manager of the facility to ensure that transition.
  8. No resolution, even on an interim basis, was passed at this meeting dealing with the terms and conditions upon which the appellant would act as CEO, including his salary.  There was a discussion at the first Board meeting of the need to establish a remuneration subcommittee to discuss the terms of the appellant’s contract.  No contract was ever tabled or produced and there was no discussion about remuneration or vehicles.  There was no discussion as to whether a contract had already been drafted at that time.  A resolution was passed that there be a subcommittee formed to discuss the terms of the appellant’s contract.  That discussion was to take place at a strategic planning day.  The terms of the contracts of Barlow and Berriman, who were employed as nurses at the facility when it was run by the Council, were not discussed at the first board meeting.  There was also no discussion about compensation for work done in the transition period by the appellant, Barlow or Berriman.
  9. During the first board meeting, the appellant presented and discussed a CEO operational report.  According to that report, the process of transition had taken nearly a two year period and had involved extensive work by key personnel, the appellant, Barlow and Berriman, with the majority of the work being undertaken outside of normal business working hours.  There was no discussion at the meeting about compensation for any of them for the work they had undertaken.  Hare did not raise with the appellant a concern that he had been doing all this extra work.  The conversation did not specify exactly how many hours were done outside of working hours and the majority of the work the appellant had undertaken was as an employee of the Council.  His working hours were a matter for the Council.
  10. At the meeting, the appellant also tabled a rule book, prepared by the Office of Registered Indigenous Corporations, containing the rules and regulations Mutkin needed to abide by for its governance and management.  That rule book was signed by the appellant.  The appellant as CEO was to abide by that rule book.  The rule book provided that all payments made out of Mutkin’s money must be supported by adequate documentation and be approved for payment at a directors meeting or in accordance with approved delegations.  All cheques, withdrawal forms, electronic funds transfer transactions and other banking documents for $500 and above must be signed by at least two directors, including ex officio directors and the contact person.  The appellant was Mutkin’s contact person.
  11. Hare had two discussions with the appellant about the contents of the rule book.  The appellant said he had done the work in preparing it and getting it all done and was ready to go.  Whilst the appellant was the nominated contact person pursuant to the rules, nomination of the appellant as Mutkin’s contact person was not dealt with at the first meeting of directors.  Hare was not aware of any resolution by the board appointing the appellant as Mutkin’s contact person.  There was no such resolution at the first or second meetings of the Board.
  12. Hare said prior to the second board meeting, the appellant provided her with financials, including a draft yearly budget for Mutkin.  The appellant provided this to Hare on around 29 August 2013.  That draft yearly budget included registration and insurance expenses for seven vehicles.  Three vehicles were identified as “James’s car, Nick car, Kylie car”.  The draft yearly budget did not contain any reference to payment of earlier wages.
  13. A second board meeting was held on 28 September 2013.  During that meeting, the appellant tabled a financial report.  The board queried prior year wages and salaries of $248,414.  The appellant said that was prior year wages and salaries owed to staff.  The appellant did not identify which staff members and did not discuss the purchase of any motor vehicles.  The only discussion about the appellant’s contract at this meeting was that the Remuneration Sub-Committee still had to review all staff contracts and awards.  The contracts of Barlow and Berriman were not discussed at the meeting specifically.
  14. Following the second board meeting, Hare met with the bookkeeper.  Upon reviewing a copy of the bank statements, Hare identified a particular transaction which she viewed inside the MYOB file.  That review revealed an amount of transactions totalling about $254,000, including a transfer out of the bank account of $248,414, to a corporation called Servico, which was the company name for a motor dealer, Pacific Toyota.  The transaction had as its description “wages and salaries prior year”.
  15. Subsequent to obtaining this information, Hare obtained copies of employment contracts in the names of the appellant, Barlow and Berriman.  The appellant’s contract was not signed when she saw it.  She had never discussed the terms of the contract with the appellant.  Clause 4.4 of the appellant’s contract, headed “Additional Allowances”, provided for a motor vehicle, chosen by the CEO, to be gifted to him at the commencement of his contract in lieu of services previously rendered for contribution in the establishment of Mutkin.  That vehicle was to remain the property of the appellant during and after the termination of his employment.
  16. Barlow’s contract, which was not signed, contained a clause 4.4 for additional allowances in similar terms.  Hare would have expected such a contract to have been given to the board for its approval.  The board did not ever see Barlow’s contract.  Hare also saw a copy of a signed contract between Mutkin and Berriman.  It contained a clause 4.4 with provision for additional allowances in similar terms.  The board did not authorise that contract.  To Hare’s knowledge the board had never given permission for a clause of that nature to be in the appellant’s contract or the contracts of Barlow and Berriman.  The Board never discussed any of those contracts.
  17. Hare became aware that the three motor vehicles transferred into the names of the appellant, Barlow and Berriman were originally purchased in Mutkin’s name.  The board did not give permission for the appellant to authorise the expenditure involving the purchase of these motor vehicles.  The appellant was asked to explain the purchase of the Land Cruisers and the terms of the contracts.  The appellant provided a signed written response in which he contended he did not know he needed to get authority from the board.  There was no board at that stage to obtain direction or finance policy.  Further, he had authority, as part of the transition process, to engage in all appropriate services to undertake the transfer of the facility to Mutkin.
  18. The appellant contended that as part of that authority, he sought the help of Barlow and Berriman.  He would not have been able to undertake the transition himself as it was such an enormous task.  He realised the transition would mean many extra hours, with most of the work being done after hours and on weekends.  He told Barlow and Berriman to keep track of all of those hours.  The amount of hours worked by each of them was equal to the price of the motor vehicle.  The appellant made the decision to purchase the motor vehicles based on the authority he received at the start of the transition process.
  19. All of his decisions were based on what he had been authorised to do in February 2012 by Jeffrey Jenkins.  They received three lots of transition funding from government departments to assist with the costs incurred during the transition which was mainly for staff wages.  Council also advised there was approximately $600,000 surplus to use.  This was what Jeffrey Jenkins based his decision on to give the appellant the authority to do whatever was needed to ensure the transition took place.
  20. The surplus came about by the appellant, Barlow and Berriman doing extra tasks and not being rewarded and by staff not being paid under the Award that was linked to the funding.  The appellant had unsuccessfully sought assistance to change the Award.  His wage had not changed despite his functions changing from manager to that of CEO.  He had been told by Jenkins he would not receive a pay rise because of who he was and because he was not white.  He was told when the transition took place he could remunerate himself as he saw fit.
  21. The appellant contended there was no fraudulent activity involved as the cars were for the hours worked during the Mutkin transition.  The other costs such as the roadworthy were part of the vehicle transfer.  The appellant was advised by Pacific Toyota it was cheaper to purchase the vehicles in Mutkin’s name and then to transfer them to their names.  If the vehicles were purchased directly in private names, this would have caused extra cost.  He chose the cheapest option.  The vehicles given to Barlow and Berriman matched the hours put into getting Mutkin up and running.
  22. The appellant contended he had been advised the board employed one person, the CEO.  The CEO employed the rest of the staff.  The appellant did not think he needed to discuss anyone else’s contract with the board, other than his own contract.  The appellant gave a copy of his contract to a member of the board on 26 April 2013.  That member read it from front to back and said he would take it to the board.  The appellant chased him up at least once a week.  The appellant was never told his contract was not okay.  He assumed there was nothing wrong with it.
  23. In cross-examination, Hare agreed that Mutkin assumed responsibility for management of the facility on 1 July 2013.  The first meeting of directors was some 41 days later.  In that 41 day period, no decisions or resolutions were made by the directors concerning the management or operation of the facility.  Hare accepted there were many decisions and actions that had to occur on assumption of responsibility for the facility.  The management of the transition of the facility to Mutkin lay with the appellant.
  24. Hare agreed it was left up to the appellant to make decisions about the transition of staff from being employees of the Council to being employees of Mutkin and to secure contracts on Mutkin’s behalf for service providers such as accountants, bookkeepers, lawyers and insurance.  All of those activities were done without discussion with board members.  Prior to 30 June 2013, draft policies and procedures had been given to the appellant.  None had been endorsed by the board of directors of Mutkin.  There were no resolutions about the management structure of Mutkin.
  25. Hare agreed that at the second Board meeting, on 28 September 2013, the directors were provided with a budget analysis by the appellant.  That analysis included a line item for total prior year expenses.  Hare queried the amount.  When she was told it was for outstanding leave and other wages from the transition period, Hare asked the appellant was that annual leave, long service leave and who were the staff members.  The appellant did not provide a response.  Hare asked about it twice at the meeting.  There was no other information available at that time.  The appellant was to give her that information as soon as it became available.  The meeting then moved onto other topics.
  26. Jeffrey Jenkins, the CEO of the Council from 16 January 2012 for about two and a half years, knew the appellant in his role as a Council worker running its aged care facility.  He also knew Barlow and Berriman as employees of that facility.  The facility came under his mandate as Council CEO.  It was part of the services provided by Council.  Funding came from two or three sources, mainly the Department of Health and Aging but also the State Department of Family Services.
  27. After Jenkins commenced as CEO in 2012, there was a move to separate the aged care facility from Council.  The Council had a philosophy of community based management.  Jenkins authorised the appellant to investigate whether that was a viable option.  A consultant, Steven Begg, undertook a range of research.  Ultimately, Council resolved that a community based management model was viable.  The transition took place from 1 July 2013.  There was a presumption the appellant would maintain the manager’s role, although the ultimate decision would be that of the new Board.
  28. The appellant was given authority by the Council to undertake the process of moving the aged care facility to a community based Board of Management.  There was no discussion between Jenkins and the appellant that the appellant could reward himself or any other employee, financially or otherwise, for the work done in that transition.  The standard practice in Council was that if people needed to work extra hours that would be pre-approved through him as Council CEO.  Council did not look favourably upon the alternate process of time off in lieu.  Overtime was not normally allowed to be banked up.  The normal practice was to pay overtime as it occurred, given the requirement for pre-approval.
  29. Jenkins had discussions with the appellant about his remuneration before the transition occurred on 1 July 2013.  His advice to the appellant was that it would be up to the Board to remunerate or develop whatever package they wanted with all staff, especially senior staff like the appellant.  Upon transition, all funds previously held by Council for the aged care facility were transferred to Mutkin, except for a minor amount the State did not want to transfer to see if the process worked over the first 12 months.  It was the Board’s responsibility to manage the facility after transition.  Jenkins denied ever having a conversation with the defendant to the effect he would not get a pay rise because he was not white.
  30. In cross-examination, Jenkins agreed that by the time he commenced as Council CEO there had been discussions about a resolution to move the aged care facility to community control.  The resolution was approved during his time as CEO.  The Council tasked the appellant with investigating whether a transition was viable and with arranging and managing the transition process.  That task was above his regular duties as manager of the aged care facility.  It was a large and involved endeavour but was supported by an independent consultant paid for out of a budget of around $600,000 to facilitate that process.  Jenkins had regular meetings with Steven Begg through that process.  Begg’s role was to make the necessary application for transfer of the Commonwealth funding for the programmes run by the Council aged care facility to Mutkin as well as a variety of other functions.  Begg reported back to Jenkins.
  31. The appellant was not allocated an allowance by Council for managing the transition and Jenkins did not authorise any monetary award for the appellant’s role in the transition.  The Council had no further role in management of the facility after 1 July 2013.  Jenkins made it clear to the appellant his remuneration as CEO of Mutkin would be a matter for Mutkin after 1 July 2013.  It was not a Council concern.  Jenkins had no involvement in the formation of Mutkin.  The Council also had no involvement in the recruitment of its Board.  That process was undertaken by the appellant along with Steven Begg.
  32. The staff employed by the Council at the facility were transferred over to Mutkin as at 1 July 2013.  Jenkins did not have any involvement in the employment of those staff by Mutkin.  He did have involvement in negotiations with the unions and staff about whether they wanted to stay with Mutkin or stay with Council.  The appellant was Jenkins’ point of contact for Mutkin through that process.  The appellant could not be the CEO of Mutkin until after 1 July 2013.  Prior to that date he was manager of the aged care facility under Council’s workforce plan.
  33. Jenkins agreed the Council resolution in relation to the transition process gave the appellant the power, along with the independent consultant Steven Begg, to arrange for the transfer of the facility to a community based management model.  The appellant was responsible at the Mutkin end as manager of the aged care facility in line with Council’s policies and procedures.  The appellant was given no further remuneration in respect of the tasks undertaken by him in his role of managing the transition process to the community based organisation.
  34. Leon Yeatman was a member of Mutkin’s interim Board.  He had a long association with the appellant as a community member and as part of a number of sporting associations at Yarrabah.  He also knew Barlow and Berriman.  Yeatman did not attend the first Board meeting.
  35. Yeatman was at the premises of Pacific Toyota on 2 August 2013.  He had a brief conversation with the appellant at those premises on that day.  The appellant told him that two nurses and the appellant were getting a Land Cruiser for work they had done during the transition.  He had no reason to believe the appellant would do anything untoward but was not thinking about it as he was there to procure a car for his daughter, not to do Mutkin business.  Yeatman did not raise that discussion with the appellant at a subsequent meeting of Mutkin.  Yeatman assumed that proper procedure had been followed in the process.
  36. Yeatman attended the second Board meeting on 28 September 2013.  He could not recall if the purchase of the vehicle was discussed at that meeting.  He could not recall the Mutkin Board ever giving the appellant permission to purchase any vehicles or gift any of those vehicles.  He could not ever recall seeing any contract of employment between the appellant and Mutkin.
  37. In cross-examination, Yeatman accepted that the appellant was a dedicated, committed manager of the facility for about 22 years and was an active member in the Yarrabah community.  The appellant had a reputation, when he was president of the local football club, of being reliable and committed and always putting his best foot forward.  He was a returned serviceman who had undertaken two tours of duty.
  38. Yeatman said the appellant’s role as manager of the aged care facility involved day to day administration of the facility.  Whist it was Council operated, that role did not involve human resources.  The appellant assisted the human resources manager who dealt with awards, wages and so forth.  The appellant did not make financial decisions in respect of the facility and had no executive decision-making functions whilst he was manager of the Council run facility.
  39. Yeatman’s expectation as a board member of Mutkin was that the appellant would provide governance to the board as CEO of Mutkin so the board could make clear decisions on funding and start operating the facility as an independent entity.  The board did not provide any training to the appellant.  The Council had assembled a crew of competent people to assist with formulating the governance structure.  During the period of transition the interim board had responsibility to make decisions.  Yeatman accepted that board did not make any decisions until after the transition.  That was a less than ideal situation.
  40. Drew Dangar was appointed as chairperson of the Mutkin board.  He had known the appellant for a number of years.  In 2012, the appellant approached Dangar to be a member of the board of Mutkin.  Dangar had previous board experience.  Dangar did not ever attend any board meetings.  He had a car accident in March 2013 and ceased being involved with Mutkin by the time it had been set up.  Dangar officially resigned from the board in September 2013.
  41. Dangar said that before Mutkin took over operation of the facility on 1 July 2013, he was visited by the appellant at his home on a number of occasions.  It is possible that during one of those visits the appellant showed him a contract or employment agreement between the appellant and Mutkin.  Dangar did not read the contract fully.  He may have skimmed it until he got to the point of remuneration.  Dangar did not sign the contract.  He did not tell the appellant he would take the contract to the board.  Dangar told the appellant it had to go to the board for approval.  Dangar did not keep the contract.  He gave it back to the appellant.
  42. In cross-examination, Dangar accepted that as the inaugural chairperson of Mutkin’s board, he had conversations with the appellant about Mutkin and signed documents setting up bank accounts for Mutkin.  When the appellant brought his contract around to read, he skimmed the document.  He read the part about salary.  He did not read the part about any vehicle.  He accepted he may, in earlier court proceedings, have said he had seen the provision about the vehicle.  He denied he “okayed” the contract.  He told the appellant it had to be taken to the board for approval.  He did not make any adverse comment to the appellant about the remuneration he was seeking in that contract or about the vehicle.
  43. Cleveland Fagan was also a member of the board of Mutkin.  The appellant asked Fagan to be a member of the Mutkin board, after the transition of the facility to Mutkin.  Fagan had seen an employment contract in relation to the appellant’s employment as CEO of Mutkin.  He believes he saw the contract before the first board meeting.  He did not sign the contract.  Fagan did not recall what remuneration the appellant was on before the board decided on his remuneration.  He assumed he would have moved over on the same wage level as he was with the Council.
  44. Fagan said the appellant dropped an envelope out to Fagan’s mother-in-law’s house.  Fagan skimmed the document.  He looked at the wage component, put it back in the envelope and took it back to the appellant.  He did not read the contract cover to cover.  Fagan told the appellant the setting of the CEO’s wages and packages was the responsibility of the board.  There was a process to go through around identifying how much that would be and the board would negotiate with the CEO as to the contents of that package.  The appellant did not say anything in reply to him.
  45. Fagan and Dangar put the appellant’s contract or remuneration onto the agenda for the first board meeting.  There was discussion about the need to look at the contract but the contract was not discussed in depth.  Fagan told the appellant before the board meeting that the board would have to see the contract.  The appellant did not ever speak to Fagan about the contracts of Barlow and Berriman or about vehicles.  Fagan said the appellant arrived at his house after the August board meeting driving a Land Cruiser.  He asked Fagan about the process for purchasing a vehicle.  Fagan told him about the process he went through at his organisation.  Fagan assumed the vehicle was a Mutkin vehicle.
  46. Fagan said at the second board meeting, on 28 September 2013, the appellant’s contract was not discussed but vehicles were briefly raised by Tony Walsh.  Fagan decided to resign from the Mutkin board after the October meeting.  He had a brief conversation with the appellant who brought in a show cause letter.  He spent time talking to the appellant about what he needed to do to respond to the board.  The appellant told him the vehicles were payment for overtime he, Barlow and Berriman did for the transition.
  47. In cross-examination, Fagan accepted the board had never discussed the appellant’s wages and conditions or that the appellant would move over on the same wages and conditions as he enjoyed at the Council.  Fagan accepted the appellant had regular discussions with him about Mutkin and the transition process.  The appellant was regularly asking for a first meeting of the board.  Having the first meeting 41 days after the transition of the facility to Mutkin was longer than had been needed but it took time to get people together.  They were on a voluntary interim board.
  48. Fagan agreed that on the day of the transition of the facility into Mutkin’s control, the Mutkin board had not passed any resolutions concerning the management and operation of the facility.  In that interim period, it was left to the appellant to manage as best he could without any guidance from the directors.  Fagan saw one of the primary roles of the board to be the appointment of a CEO.  Once the CEO was appointed that person would look after all operational matters.
  49. Fagan accepted that when the appellant left his proposed contract with him, he took it seriously but did not read it from cover to cover.  Whilst he read the salary and wages component, he did not recall seeing anything about a car.  He only looked at the wage.  He did not read clause 4 in its entirety.  Two days after the appellant had given him the contract, Fagan took it back to the appellant and explained that only the full board could make that decision.  Fagan told the appellant he would table the contract at the board meeting.  He thought the remuneration he was seeking was excessive but did not tell the appellant.  He made no adverse comment about the contract at all to the appellant.
  50. Fagan did not bring a copy of the contract to the first board meeting.  There were other priorities.  At the board meeting, he advised that the appellant’s contract should be reviewed.  He meant the contract the appellant was currently on when he came over from the Council.  He agreed the appellant was not on any contract with Mutkin at that time.  There was no discussion by the Board as to the nature of the arrangements upon which the appellant was then engaged by Mutkin at the first board meeting.  He did not discuss the contents of that proposed contract with any other members of the board.  No resolution was passed at that board meeting as to the appellant’s salary and working conditions and entitlements in the interim whilst his contract was reviewed.
  51. Fagan said when he saw the appellant driving to his house in a silver Land Cruiser after that board meeting, he asked him whose vehicle it was and the appellant told him it was a Mutkin vehicle.  Fagan agreed that was a significant purchase with Mutkin’s funds.  Fagan did not make any further inquiries or raise this matter with any other director at the next board meeting.  He was not concerned about the purchase at that time.
  52. Marina Patterson was employed at Mutkin’s aged care facility as a supervisor.  She knew both Barlow and Berriman.  She signed the employment contract between Mutkin and Barlow as a witness.  Patterson recalled seeing Barlow and Berriman with new Land Cruisers.  She asked the appellant about the Land Cruisers.  He told her the Land Cruiser was his car.
  53. Alisa Lively has known the appellant through working with him at the Council for about 17 years.  She also knew the nurses Barlow and Berriman.  The appellant asked Lively for assistance during the transition process.  Lively was at that time the CEO of her own organisation, the Gindaja Treatment and Healing Indigenous Corporation, a community run organisation.  She offered the appellant copies of policies and procedures such as governance, human resources and finance.
  54. Lively became a member of the Mutkin board around October 2013.  She saw the contract for the appellant, Barlow and Berriman.  Barlow’s and Berriman’s contracts were signed when she saw them.  They had been signed by the appellant.
  55. Kylie Berriman was employed as a registered nurse at the facility from 2004.  She remained employed at the facility when it was transitioned to Mutkin.  The appellant was her manager.  Barlow was a fellow employee.  Berriman said before the transition she was given a contract by the appellant.  The appellant pointed out the salary and the clause for cars in lieu of hours worked and back pay.  Berriman signed the contract as did the appellant.  The signatures were witnessed by Marina Patterson.
  56. Berriman was involved in the transition process between the Council and Mutkin.  She undertook work such as filling out application forms as well as new staffing regimes and human resources position descriptions.  She assisted Steven Begg in that process.  At some point before the transition there was talk between her and the appellant about purchasing some motor vehicles to get to and from work.  She understood they were to be owned by Mutkin but be for their personal use.
  57. Berriman continued to work at the facility three days a week after the transition.  A Land Cruiser was delivered to her in Mutkin’s name.  The appellant told her to download a form to transfer ownership of it to herself from Mutkin.  She paid the stamp duty and road worthy costs incurred in that transfer.  She was told to reimburse herself from Mutkin’s account by the appellant.
  58. Mitchell Holmes, an accountant, was employed by Mutkin after 1 July 2013 to assist with the MYOB application and the setting up of bookkeeping facilities.  While there he became aware of the purchase of three Land Cruisers.  During his time at Mutkin, the appellant told him not to discuss any matters that he learnt out there with anyone including the board members of Mutkin.
  59. Donald Elmer was employed by Council from 2007 as its human resources manager.  In that role, he would work with people from the facility.  He knew the appellant and liaised with him from time to time about employment contracts and other things to do with human resources.  The appellant was employed under the Municipal Officers Award.  That required he work 72.5 hours a fortnight.  The appellant filled out time sheets for himself and other people at the aged care facility.  Elmer signed off on some of those time sheets.  He did an audit to check the information as given was transferred to payroll.  He was aware the appellant consistently worked 80 hours a fortnight.  If overtime was claimed, it was usually paid by Council.  Elmer’s signature appeared on some of those claims.
  60. Caroline Sinclair was employed by Council as the coordinator of the Community Development Employment Program between 2002 and 2007.  In that role, she had occasion to work with the appellant in his capacity as manager of the aged care facility.  The appellant’s reputation was one of integrity.  He had a “great capacity for doing so many things all the time.”  At some stages he was “working 24 hours, virtually.”  He was working not only his job as manager of the aged care facility but also with community projects.  Sinclair also worked with the appellant in his capacity as president of the local rugby league team.  The appellant had a reputation as an upstanding member of the community who had done his best for the club.
  61. Sinclair assisted the appellant in preparing the initial proposal to be put to Council for transitioning the facility to Mutkin.  A lot of work was put into that proposal by the appellant.  The appellant helped Sinclair understand aged care and assisted Sinclair in filling out the application forms for transition of the facility to Mutkin.
  62. Steven Begg was employed by the Council in September 2012 to provide consulting services for the transition of the aged care facility to Mutkin.  He assisted in initially preparing a large application seeking approval for Mutkin to provide residential care.  Once that was approved, he assisted Council to transfer the existing aged care places and funding to Mutkin.  There were a number of applications.  In undertaking this task, he had many discussions with the appellant, Barlow and Berriman as well as with the interim board members.  He spoke to the appellant about those applications.  If he needed assistance he would telephone the appellant, Barlow or Berriman during work hours.  He completed his process in May 2013.
  63. In cross-examination, Begg accepted he was not involved in the initial discussions regarding a proposal being put to Council for a community organisation to assume control of the aged care facility or in any investigation of whether such a transition was viable or possible.  His involvement commenced after Mutkin had been established and he did not play a role in the registration of Mutkin or in any human resource issues in terms of the engagement of staff by Mutkin.  Begg also did not have anything to do with establishing the rule book for Mutkin.  He agreed the appellant undertook the transfer of some programs without Begg’s assistance.

Summing up

  1. Holmes’ evidence was mentioned briefly in the summing up, as part of a summary of the respective cases of the Crown and the defence.  His Honour said:

“It was submitted to you that in the circumstances it might be reasonable to think that no one expected dishonest conduct from the defendant.  It was submitted to you that you would have little hesitation in concluding that the defendant was familiar with the rule book in the circumstances.  You were asked to look at the profit and loss statement, that’s part of exhibit 2, which was tabled at the second meeting.  And you were reminded of the evidence insofar as the entry what is said to represent salaries from the previous year and representing long service leave and overall wage, but there being no mention of cars, transition work or overtime duties.  You were reminded of the evidence of Mr Holmes when he was told by the defendant, according to his evidence, not to say anything to the board.

You were taken to the employment agreement in clause 4.4 and it was submitted that the contract, in fact, never commenced as it was never signed.  It was also submitted to you that the clause 4.4 does not identify even the type of motor vehicle and it could have ranged from anything from a very inexpensive car to a most expensive vehicle.  It was submitted that the defendant, it is clear, knew he was not entitled to the cars, that he was told to take his contract to the board, that he did not do so but he, nevertheless, accessed the cars anyway despite his lack of authority and that he was, on all accounts acting dishonestly, and that the Crown proved beyond reasonable doubt that he was not acting under an honest claim of right.”

Appellant’s submissions

  1. The appellant submits the only possible relevance of Holmes’ evidence was as post-offence consciousness of guilt.  Such evidence can only amount to admission by conduct if the jury is satisfied it was deliberately untrue, was connected with the offence and was undertaken because the defendant knew that the truth would implicate him in the commission of the offence.[1]  Where such evidence is led, a warning must be given to the jury that there may be reasons that people have engaged in such conduct other than from a consciousness of guilt.[2]  Such a direction is necessary whenever post-offence conduct may be used by the jury as evidence of consciousness of guilt.[3]
  2. The appellant submits that as Holmes’ evidence had no potential relevance except as post-offence consciousness of guilt evidence, the failure to give an Edwards’ direction and warning allowed the jury to misuse that evidence in deciding whether the initial issue of dishonesty was established beyond reasonable doubt.  The appellant was thereby deprived of the fair chance of an acquittal.  The verdict of guilty ought to be set aside and a new trial ordered.

Respondent’s submissions

  1. The respondent submits an Edwards’ direction was not required and would have been inappropriate in the circumstances.  The Crown did not at any point, point to any evidence as being consciousness of guilt evidence.  The Crown case was that the appellant knew he was not entitled to the claimed compensation in the form of the motor vehicle as there was evidence the appellant was not acting honestly.  He had not openly told the Board or its members of the purchase of the vehicles.  He had not received Board approval for his contract.
  2. The issue at trial was whether the appellant was acting dishonestly.  The evidence of the appellant’s conduct was consistent with someone acting dishonestly and inconsistent with someone acting honestly without intent to defraud.  The latter contention was relevant as the defence case was that the defendant was acting under an honest claim of right without intention to defraud.  Against that background, it would have been inappropriate and to the disadvantage of the appellant for directions to be given focusing on Holmes’ evidence as consciousness of guilt.  Further, neither the Crown nor the defence asked for such direction or sought a re-direction on that issue.  Against that background, it cannot be said that there has been a miscarriage of justice in all of the circumstances.

Discussion

  1. Where evidence of post-offence conduct of an accused person is led at trial to establish the guilt of the accused, there is a need to ensure a jury is properly directed as to the misuse of evidence of that kind.  The relevant principles were summarised by Keane JA (as his Honour then was) in R v Mitchell:[4]

[50] The effect of these decisions of this Court may, I think, be summarised in the following way:  while it is for the jury to determine whether the circumstances are such that a lie can be said to be understood as revealing a consciousness of guilt of the greater offence, where the false statement is capable of amounting to an acknowledgment of guilt of one or more of several offences with which the accused stands charged, it is necessary for the trial judge to point out to the jury the possibility that the consciousness of guilt revealed by the lie relates to the lesser offence.  The position has been stated in similar terms in the Victorian Court of Criminal Appeal and Court of Appeal in R v Woolley and in R v Ciantar respectively.  This statement of the position is also in conformity with the decision of the Court of Criminal Appeal of Western Australia in Banks v The Queen.”

  1. Whilst that need often arises in circumstances where the Crown expressly leads the evidence as “consciousness of guilt”, appropriate directions will be necessary even if that description has not been affixed to the evidence by the prosecution if that evidence is being used by the prosecution to establish that by that conduct the accused was implicitly admitting his guilt.[5]
  2. However, if the prosecution is not contending for such use of that evidence and the evidence is not capable of bearing the character of evidence which would implicate the accused in the commission of the offence, an Edwards’ type direction is not appropriate unless there is a risk of misunderstanding on the part of the jury as to the use to which they may put such evidence.[6]  As the majority in Zoneff observed:

“As a general rule, however, an Edwards-type direction should only be given if the prosecution contends that a lie is evidence of guilt, in the sense that it was told because, in the language of Deane, Dawson and Gaudron JJ in Edwards, ‘the accused knew that the truth … would implicate him in [the commission of] the offence’ and if, in fact, the lie in question is capable of bearing that character.  (The words in italics are ours and, for the sake of clarity should be included in the statement of principle.)”

  1. In the present case, Holmes’ evidence was not led as evidence of consciousness of guilt and was not relied upon by the prosecution in that way at trial.  The evidence was led as being relevant to the central issue in the trial, namely, whether the appellant acted dishonestly with intent to defraud Mutkin.  It was also relevant to negativing an assertion the appellant honestly believed he had an entitlement to receive the motor vehicle in payment of unpaid work undertaken by him in the transition of the facility from Council to Mutkin.
  2. Holmes’ evidence, as given, did not specifically relate to the transaction involving the motor vehicle.  It did not relate to any specific transaction undertaken by the appellant as Chief Executive Officer of Mutkin.  The evidence was, at best, equivocal.  There is therefore force in the respondent’s contention that there was no real risk the jury would use the evidence as probative of guilt.[7]  There was no real risk the jury would conflate that evidence into evidence of a lie implicating the appellant in the commission of the offence.  That being so, no Edwards’ type direction was necessary.  There was also no proper basis upon which the trial Judge could be said to have had an obligation to give an Edwards’ type direction.
  3. Further, there were good forensic reasons why the appellant’s trial counsel would not have sought an Edwards’ type direction.  Such a direction would have highlighted Holmes’ evidence, giving it an importance it did not deserve in circumstances where such importance would be to the appellant’s detriment.  Any Edwards’ direction would have required identification of that evidence as probative of a consciousness of guilt in circumstances where no such contention was being advanced by the Crown.  Against the background, the trial Judge properly dealt with Holmes’ limited evidence as part of a summary of the respective cases at trial.
  4. There is no basis to conclude the jury would have misused Holmes’ evidence to impermissibly reason that the appellant’s statement to Holmes was evidence he made the statement to Holmes knowing he was guilty of dishonestly obtaining the Land Cruiser with an intention to defraud Mutkin.  There is also no basis to conclude the admission of that evidence, in the absence of an Edwards’ type direction, has resulted in a miscarriage of justice in the sense that the absence of that direction deprived the appellant of a fair chance of acquittal.
  5. The evidence led at trial, if accepted by the jury, established beyond reasonable doubt that the appellant had purchased the Land Cruiser in Mutkin’s name, using Mutkin’s funds before transferring the vehicle into his own name at Mutkin’s expense.  That conduct occurred without Mutkin’s authority or approval.  The contract of employment sought to be relied upon by the appellant to support that conduct had never been approved by the Board.  The appellant had been told his remuneration had to be the subject of Board approval.  Such evidence amply supported a conclusion beyond reasonable doubt that the appellant had dishonestly gained a benefit for himself in respect of property of a value over $30,000.
  6. There is no basis to set aside the jury’s guilty verdict.

Order

  1. I would order the appeal be dismissed.

Footnotes

[1] Edwards v The Queen (1993) 178 CLR 193.

[2] Zoneff v The Queen (2000) 200 CLR 234.

[3] R v Roberts & Pearce [2012] QCA 82.

[4]  [2008] 2 Qd R 142 at 155 [50].

[5] R v Chang (2003) 7 VR 236 at 239.

[6] Zoneff v The Queen (2000) 200 CLR 234 at 244.

[7] R v Nguyen (2001) 118 A Crim R 479.

Close

Editorial Notes

  • Published Case Name:

    R v Canuto

  • Shortened Case Name:

    R v Canuto

  • MNC:

    [2017] QCA 281

  • Court:

    QCA

  • Judge(s):

    Sofronoff P, Gotterson JA, Boddice J

  • Date:

    17 Nov 2017

Litigation History

EventCitation or FileDateNotes
Primary JudgmentDC495/15 (No Citation)15 Nov 2016Date of Conviction (Farr SC DCJ)
Appeal Determined (QCA)[2017] QCA 28117 Nov 2017-

Appeal Status

Appeal Determined (QCA)

Cases Cited

Case NameFull CitationFrequency
Edwards v The Queen (1993) 178 CLR 193
2 citations
Edwards v The Queen [1993] HCA 63
1 citation
R v Chang (2003) 7 VR 236
2 citations
R v Chang [2003] VSCA 149
1 citation
R v Mitchell[2008] 2 Qd R 142; [2007] QCA 267
3 citations
R v Nguyen (2001) 118 A Crim R 479
2 citations
R v Nguyen [2001] VSCA 1
1 citation
R v Roberts [2012] QCA 82
2 citations
Zoneff v The Queen (2000) 200 CLR 234
3 citations
Zoneff v The Queen [2000] HCA 28
1 citation

Cases Citing

Case NameFull CitationFrequency
R v Ogunseye [2024] QCA 1522 citations
R v WBS [2022] QCA 180 2 citations
1

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