Kapila v R

1. [1]

   HARRISON CJ at CL: I agree with Weinstein J and with the orders he proposes.

2. [2]

   BUTTON J: I agree with Weinstein J.

3. [3]

   WEINSTEIN J: The applicant, Nitin Kapila, seeks leave to appeal against the sentence imposed on him in the District Court pursuant to s 5(1)(c) of the Criminal Appeal Act 1912 (NSW). On 24 February 2023, O’Brien AM DCJ sentenced the applicant to an aggregate term of imprisonment of 4 years and 6 months with a non-parole period of 2 years and 6 months for the following offences:

   1. (1)

      Deal with property to the value of $100,000 or more where there are reasonable grounds to suspect that the property was the proceeds of crime, namely $1,211,897, contrary to s 193C(1) of the Crimes Act 1900 (NSW) (Crimes Act) for which the maximum penalty is five years imprisonment and for which there is no standard non-parole period (count 1); and

   2. (2)

      Attempt to dishonestly obtain a financial advantage by deception, namely $2,500,000, contrary to ss 192E(1)(b) and 344A(1) of the Crimes Act for which the maximum penalty is 10 years imprisonment and for which there is no standard non-parole period (count 2).

4. [4]

   An offence of knowingly participate in a criminal group contrary to s 93T of the Crimes Act was included on a notice filed by the prosecutor under s 32(1) of the Crimes (Sentencing Procedure) Act 1999 (NSW) (Form 1, and the Sentencing Act respectively). It was taken into account at the applicant’s request pursuant to s 33(1) of the Sentencing Act and attached to count 2.

5. [5]

   The sentencing judge applied discounts of 5% for the applicant’s pleas, which were entered five days before his trial was listed to commence: s 25D(2) of the Sentencing Act. His Honour specified 22 months imprisonment as the indicative sentence for count 1. For count 2, he specified 4 years imprisonment as the indicative sentence, taking into account the Form 1 offence. The sentence was backdated to commence on 23 October 2022 to reflect 124 days of pre-sentence custody. The applicant’s head sentence will expire on 22 April 2027. He will be eligible for release to parole on 22 April 2025.

6. [6]

   The applicant relies on one ground of appeal:-

   1. (1)

      The sentencing judge erred in the manner in which the further offence on the Form 1 was taken into account. In particular, the sentencing judge engaged in ‘double counting’ of the Form 1 offending by:

7. [7]

   For the following reasons, I would grant leave to appeal but dismiss the appeal.

Facts of the offending and the sentencing proceedings

1. [8]

   The applicant was charged with large scale money laundering activity with five co-accused, and he was committed to stand trial in the District Court at Parramatta on 26 September 2022. On 21 September 2022, he signed a 35 page document entitled Statement of Agreed Facts (the agreed facts) and pleaded guilty to counts 1 and 2. On that date he also signed the Form 1.

2. [9]

   The date range for count 1 was between 1 November 2018 and 14 December 2018. For count 2, the date range was between 17 October 2018 and 9 November 2018. The date range for the Form 1 offence was between 1 October 2018 and 31 December 2018. It can be observed that the count 1 and 2 offending took place during the period in which the offender admitted that he knowingly participated in a criminal group. In other words, there was overlap between the count 1 and 2 offending, and both took place during the time that the applicant knowingly participated in a criminal group.

3. [10]

   Early in his Honour’s sentencing judgment he said the following about the Form 1 offence:-

4. [11]

   The agreed facts were comprehensively summarised by the sentencing judge in his remarks on sentence. His Honour’s summary, distilled from the agreed facts, is not challenged, and I extract it in full:-

5. [12]

   After summarising the agreed facts, the sentencing judge made the following findings with respect to the objective seriousness of both counts:

6. [13]

   I observe that the first underlined extract of his Honour’s remarks is said by the applicant to be referable only to the Form 1 offence and provides the clearest evidence that Form 1 conduct was taken into account in relation to the objective seriousness of count 1. The second underlined extract, when read with the first, is said by the applicant to demonstrate that his Honour had regard to the ongoing involvement with the joint criminal enterprise, rather than remaining focused on the nine specific transactions charged by count 1. In oral submissions, Mr Trevallion could not point to any other part of his Honour’s remarks that dealt with the objective seriousness of count 1 that was said to offend the principle against double counting.

7. [14]

   His Honour then summarised the applicant’s subjective case before synthesising all relevant factors to be taken into account on sentence. He addressed the issue of parity with the applicant’s co-offenders. When articulating the indicative sentences for each count, his Honour expressly stated that the indicative sentence for count 2 took into account the matter on the Form 1. He said:-

8. [15]

   The only other mention of the Form 1 was in his Honour’s orders, when he said:-

9. [16]

   The applicant placed much reliance on the written and oral submissions of the Crown Prosecutor during the sentencing hearing to advance his ground of appeal. In written submissions, the Crown Prosecutor contended that the acts constituting count 1 did not take place in isolation but took place in the context of the Form 1 offence, because of the applicant’s material role in the criminal group. The Crown Prosecutor submitted in writing that:

10. [17]

    During oral submissions, the following exchange took place between his Honour and the Crown Prosecutor with respect to the relevance of the Form 1 offence, in response to a submission by the applicant that the periods of offending for both counts were limited:

11. [18]

    The applicant’s written submissions at the sentence hearing referred to the well-known principles when dealing with Form 1 matters, but did not specifically deal with the application of the Form 1 offence as applied to the particular facts of this case. Neither did he refer to the Form 1 offence in oral argument.

Parties’ submissions

1. [19]

   The applicant submitted that the sentencing judge was led into error because the Form 1 offence, which was factually intertwined with count 1, was attached to count 2 with which it had no factual connection. He submitted that this created a real risk that the Form 1 offending would be double counted by the conduct of the Form 1 being considered as part of the facts going to the objective seriousness of count 1 and that the offence would be formally taken into account when sentencing for count 2. The applicant submitted that this risk materialised and that the sentencing judge erred by double counting the Form 1 offending.

2. [20]

   Mr Trevallion, who appeared on behalf of the applicant, submitted that the Form 1 offence arose from the applicant’s participation in the same money laundering joint criminal enterprise as charged by count 1. Whilst the Form 1 offence related to his participation generally in the joint criminal enterprise, count 1 related to a series of nine specific transactions totalling $1,211,897, undertaken as part of the joint criminal enterprise. The period particularised on the Form 1 overlapped with, but was broader than, the period to which count 1 referred.

3. [21]

   In making this submission, Mr Trevallion relied upon the sentencing judge’s assessment of the objective seriousness of count 1 in the remarks on sentence. He submitted that his Honour had regard to the applicant’s ongoing involvement in the joint criminal enterprise rather than the nine specific transactions charged by count 1.

4. [22]

   The applicant submitted that the Crown Prosecutor’s written submissions on sentence invited the sentencing judge to double count the Form 1 offence by having regard to it when assessing the objective seriousness of both counts. Mr Trevallion contended that whilst the Form 1 offence arose out of the same criminal group conduct as charged by count 1, the period particularised on the Form 1 was 1 October – 31 December 2018. This overlapped with, but was longer than, the period to which count 1 related (1 November – 14 December 2018). In oral argument, Mr Trevallion submitted that the establishment of the registration of new companies – part of the Form 1 offending – predated the count 1 offending, and was taken into account in determining the objective seriousness of count 1. He conceded, appropriately, that the applicant had to set up the companies as a preliminary step to the money laundering.

5. [23]

   With respect to the relevant legal principles, it was submitted by the applicant that whilst there appears to be no authority that is completely apposite to the ground of appeal before this Court, it may be inferred or deduced from the cases that whilst it is permissible to take into account the circumstances underpinning a Form 1 offence in reflecting on an offence to which it does not attach, care must be taken to ensure that if this is done, there is no double counting by applying the Form 1 offence in sentencing for the offence to which it does attach. It was submitted that because his Honour undertook no discrete consideration of the Form 1 offending, separate to the consideration of count 1, this demonstrates that his Honour conflated the Form 1 and count 1 facts and double counted the Form 1 by taking it into account when assessing the objective seriousness of count 1 (and therefore the indicative sentence), and by expressly taking it into account when specifying the indicative sentence for count 2.

6. [24]

   The Crown submitted that the sentencing judge was entitled to consider the ongoing participation of the applicant over the charge period in the Form 1 whilst the count 1 offending took place, as it provided context to that offending (as it did to the count 2 offending). She submitted that so much was clear from the Crown Prosecutor’s written submissions which referred to the Form 1 offending as context. Further, in the Crown’s submission there was nothing in the remarks on sentence which suggested that the sentencing judge had erroneously “attached” the Form 1 offence to count 1. Rather, his Honour was entitled to and did refer to the broader context of the Form 1 offending when assessing the objective seriousness of count 1. In the Crown’s submission, had his Honour assessed the objective seriousness of the nine acts constituting count 1 in isolation, this would have been erroneous. The context provided that the applicant was aware of the criminal enterprise for some time prior to joining the group, that he had gone into the group with eyes wide open, that he was an enthusiastic participant and that the offending was not isolated. It was submitted that his Honour used the Form 1 offending to demonstrate that the offending did not occur in a vacuum and did not constitute momentary lapses of judgment.

7. [25]

   The Crown also submitted that contrary to the applicant’s submission, the Form 1 offence related to the criminality of count 2. This was because in both counts, some members of the same criminal group were involved and the acts constituting both counts were carried out within the timeframe particularised on the Form 1. Therefore, the commission of both counts occurred in the context of the applicant’s participation in the criminal group, so that the Form 1 offending was relevant in this respect to his Honour’s assessment of the objective seriousness of both counts.

8. [26]

   The Crown submitted that in any event the sentencing judge took a careful approach to ensure that he did not double count the Form 1 offending so as to impermissibly increase the indicative sentence for count 1. This, in the Crown submission, is reflected in his Honour’s remarks on sentence, by the indicative sentence of 22 months (after a 5% discount for the applicant’s plea of guilty) for count 1, and when regard is had to the sentences imposed on the applicant’s co-offenders (notwithstanding that parity is not in issue).

9. [27]

   It was also submitted by the Crown that it is often erroneous for an applicant to rely on the submissions of counsel and any statements made by a sentencing judge during oral submissions in sentencing proceedings. However, the Crown submitted that it is clear from the transcript and the Crown Prosecutor’s written submissions on sentence that his Honour was attempting to extract the context within which all the offending occurred. The Crown submitted that this was clearly accepted by the sentencing judge and was reflected in his remarks on sentence.

10. [28]

    In oral argument before this Court, the Crown said that the steps taken by the applicant in setting up the fake companies (the subject of the Form 1) was set out by his Honour because that facilitated the money laundering the subject of count 1. She observed that the applicant could not point to a single place in the sentencing judge’s remarks where his Honour took the Form 1 into account with respect to count 1 because it did not occur. She submitted that his Honour clearly stated from the outset that count 2 was the count to which the Form 1 attached, the relevance of the Form 1 matter and the manner in which he would take it into account, which was realised in the sentencing judgment.

Applicable principles

1. [29]

   In Director of Public Prosecutions (NSW) v TH [2023] NSWCCA 81, Beech-Jones CJ at CL (as his Honour then was), with whom Garling and Yehia JJ agreed, summarised the authorities with respect to the significance of Form 1 offences to a sentencing exercise at [23]–[25]:

2. [30]

   The principles of the cases to which his Honour referred at [23] were summarised by Bellew and Wilson JJ in RL v R [2018] NSWCCA 274 at [54]–[55]:

3. [31]

   In Ragg v R [2022] NSWCCA 150, referring to Singh v R [2021] NSWCCA 96 and RO v R [2019] NSWCCA 183, Beech-Jones CJ at CL, with whom N Adams and Lonergan JJ agreed, said at [33]–[39]:-

4. [32]

   In Andrew Smith v R [2013] NSWCCA 209 (“Andrew Smith”), in dealing with a ground of appeal that contended that the judge erroneously engaged in double counting by taking into account matters included on two Form 1s concerning damage to property and contravening an apprehended violence order when determining the objective seriousness of an offence of intimidation, RA Hulme J, with whom Leeming JA and Button J agreed, said at [40]–[41]:-

Consideration

1. [33]

   The argument advanced by the applicant is essentially that the sentencing judge double counted the Form 1 offence by taking it into account when assessing the objective seriousness of count 1. There is no real dispute that his Honour properly took the Form 1 offence into account when expressing the indicative sentence for count 2.

2. [34]

   The applicant’s argument can be dealt with in short order.

3. [35]

   When dealing with the objective seriousness of count 1, his Honour mentioned the Form 1 offending in two sentences. In doing so, his Honour was taking into it into account as context for the count 1 offending. The first underlined sentence dealt with context in a very general way. The second sentence dealt with the offender’s role within the context of the entirety of the offending. The sentence commencing “In addition I have regard to his involvement in the establishment of the three companies and the various bank accounts used to launder funds when MCFE withdrew its services” is clearly meant to indicate that the offender’s involvement in the money laundering was not isolated. The same can be said for the sentence “The offender on the other hand undertook more tasks within the ongoing operation of the joint criminal enterprise and exercised in a real way a good deal of independence and autonomy”, which also put his role compared to his co-offenders in context.

4. [36]

   Much of the applicant’s argument centred on the Crown Prosecutor’s written submissions on sentence and the exchanges between the bench and bar table at hearing. To the extent that there is any complaint by the applicant in support of the ground of appeal that relies upon the reading of the transcript of the sentence hearing and his Honour’s responses to propositions put in oral argument, I would reject it. As Adamson J said in Dang v R [2014] NSWCCA 47 at [32] (Simpson J, as her Honour then was, and Davies J agreeing):-

5. [37]

   See also Ahmad v R [2022] NSWCCA 144 per Mitchelmore JA at [20] (Meagher JA and Bellew J agreeing) and Lonsdale v R [2020] NSWCCA 267 per Hoeben CJ at CL at [27] (Beech-Jones and N Adams JJ agreeing at [61]).

6. [38]

   Further, in this case, the applicant does not complain about his Honour’s characterisation of the objective seriousness of the count 1 or 2 offending. As is well understood, it is not the function of this Court to substitute its own view as to objective seriousness for that of the sentencing judge: Mulato v R [2006] NSWCCA 282 at [37] per Spigelman CJ and at [46] per Simpson J.

7. [39]

   Notwithstanding the authorities, I will deal briefly with the applicant’s submissions on this point. The submissions of the Crown Prosecutor at sentence that the Form 1 offence drew out the context of both counts was clearly accepted by the sentencing judge and is reflected in his Honour’s remarks on sentence. It was open to his Honour to have regard to the facts of the Form 1 offence when assessing the objective seriousness of count 1 because those facts provided important context to that offending, and to the offending constituting count 2. The Form 1 offending was the yoke which united the charged offending. To have ignored it would have made his Honour’s remarks artificial and disjointed. What his Honour could not do was take into account the Form 1 offending when assessing the objective seriousness of count 1 by increasing the gravity of that offending.

8. [40]

   In my opinion, on any fair reading of his Honour’s remarks, he did not take into account the Form 1 offending to elevate the objective seriousness of count 1. I observe that Mr Trevallion could not point to one material instance in the sentencing judge’s remarks on sentence that demonstrated that he had in fact double counted the Form 1 offence.

9. [41]

   Further, the applicant conceded that the authorities demonstrate that it is permissible for the circumstances of a Form 1 offence to be considered with respect to a charged offence to which it does not attach by way of context, but that care should be taken by a sentencing judge not to double count by increasing the objective gravity of the offence to which it does not attach. In my view, this is what his Honour did. There was no demonstrable error on the part of the sentencing judge. Rather, his Honour carefully assessed the objective seriousness of both charged offences, noting the context of the Form 1 offending. He attached the Form 1 to count 2, as he was obliged to do in accordance with s 33 of the Sentencing Act.

10. [42]

    Finally, to the extent that the applicant sought to impugn the Crown’s decision to attach the Form 1 offence to count 2, I observe that the applicant endorsed this approach, given his agreement to plead guilty to counts 1 and 2 and to admit guilt to the further offence on the Form 1 which he asked the sentencing judge to take into account when dealing with him for the principal offence of count 2: see Andrew Smith at [41].

Orders

1. [43]

   I propose the following orders:-

   1. (1)

      Grant leave to appeal.

   2. (2)

      Dismiss the appeal.