Hudson v R

HOEBEN CJ at CL:

His Honour imposed an aggregate sentence of imprisonment for 2 years and 9 months with a non-parole period of 1 year and 6 months commencing 27 May 2016.

The indicative sentences were as follows:

The applicant seeks leave to appeal against that sentence on the following grounds:

In 2003 the applicant and Ian Gregory Hudson (her husband at the time) applied for a home loan using the Wizard Home loan franchise. The loan was sought to purchase a home at 6 Monterey Street, Monterey NSW. The loan was approved for the amount of $750,000.

GE Money entered into a business relationship with Westpac Banking Corporation to facilitate the provision of Westpac branded chequebook facilities to GE customers and on behalf of GE Money Home Lending. GE Money Home Lending was not a deposit taking institution. A chequebook facility with Westpac was issued and linked to the home loan account of the applicant and her husband on 13 October 2003.

On 2 May 2006, the chequebook facility was cancelled because the applicant’s account was about to be discharged (i.e. debt cleared and loan paid out). On 27 October 2006, the account was discharged in the amount of $856,000.

Between 4 May and 21 May 2008, the applicant issued seven valueless cheques from the cancelled cheque book. For each of the cheques the applicant pleaded guilty to offences of making a false instrument and using a false instrument. The total amount of the seven cheques was $2,266,865.50. In addition, the applicant made a false representation involving $200,000.

The victim Ms Feeney in 2008 operated a general legal practice in Brighton-Le-Sands called “Feeney Lawyers”. Ms Feeney first met the applicant in May 2008 when the applicant approached her to witness a company document. During the meeting the applicant advised Ms Feeney that her home was the subject of a statement of claim. Greenstein Lawyers were acting for the second mortgagee who wanted to possess her home and she wished to defend the matter.

A few days later after their initial meeting, the applicant attended Ms Feeney’s office and provided her with some documents in relation to her matter. Ms Feeney informed the applicant that money would need to be placed into a trust account in order to start working on her case. The applicant signed a cheque (no 53) for $10,000 payable to Feeney Lawyers, dated it 5 May 2008 and gave it to Ms Feeney. Ms Feeney deposited the cheque into the “Judy Feeney Trust” account which was held by the Commonwealth Bank. The cheque was dishonoured on 8 May 2008 because the account of the applicant was closed.

The applicant made out a cheque (no 49) for the sum of $516,000 payable to “Feeney Lawyers” trust account dated it 14 May 2008 and signed it “James Jones”. The applicant gave this cheque to Ms Feeney, told her James Jones was her uncle and that he was a wealthy man. Ms Feeney deposited the cheque into her trust account. The cheque was dishonoured on 16 May 2008 because the account of the applicant was closed.

Ms Feeney informed the applicant that the only way she could stop the repossession of her property was by making a payment to Greenstein Lawyers and paying the outstanding amount owed on the mortgage.

The applicant made out two further cheques. The first cheque (no 57) she dated 16 May 2008, payable to “J O Feeney”, for the sum of $450,000 and signed it “James Jones”. Ms Feeney banked this cheque into her trust account. This cheque was dishonoured on 28 May 2008 because the account of the applicant was closed.

The second cheque (no 58), she dated 16 May 2008, payable to “J O Feeney Trust” for the sum of $275,000 and signed it “James Jones”. The applicant gave the cheque to Ms Feeney. Ms Feeney banked this cheque into her trust account. This cheque was dishonoured on 2 June 2008 because the account of the applicant was closed.

On 26 May 2008 Ms Feeney called the applicant and told her that she was required to pay her the outstanding sum of $200,000 if she wanted to retain her home. Ms Feeney and Mr Greenstein had come to an agreement that the house of the applicant would not be sold if the applicant paid the sum of $200,000. At 3:45pm the applicant called Ms Feeney and said “I am in front of the teller at the bank. I have just transferred the $200,000 into your trust account. It’s there now.”

Believing that the $200,000 had gone into her trust account Ms Feeney called her husband, John Feeney, and instructed him to bank a $200,000 cheque (being a Commonwealth Bank cheque) written by her from her trust account into Mr Greenstein’s trust account. The payment needed to be completed by 4pm that day in accordance with a court order or the applicant would lose her home. Mr Feeney banked the $200,000 cheque at the Rockdale National Australia Bank into Mr Greenstein’s Trust account.

On 27 May 2008 Ms Feeney called the Commonwealth Bank to confirm that the $200,000 from the applicant had been paid into her account. Ms Feeney was advised that there was no deposit from the previous day and no funds pending. Ms Feeney attempted to stop the cheque her husband had banked into Mr Greenstein’s trust account but was informed the cheque had already been cleared.

As a result of this payment the foreclosure on the applicant’s house was delayed.

David Greenstein in 2008 practised as a sole practitioner under the name of “Greenstein & Associates”. Mr Greenstein was instructed by Veduta Estates Pty Ltd to commence recovery proceedings against the applicant and her husband for defaulting on the payment of two loans totalling $462,969 and interest accruing. The Supreme Court issued an “order of possession” against the property which secured the loans.

An agreement was arranged by the applicant, her husband and Veduta Estates Pty Ltd in respect of repayment of the loans by a certain date in return for not pursuing the possession order.

The applicant made out a cheque (no 54) for the sum of $500,000, dated it 16 May 2008, payable to “Greenstein Lawyers”, signed it “James Jones” and deposited the cheque into Mr Greenstein’s trust account. This cheque was dishonoured on 23 May 2008 as the account of the applicant was closed.

The applicant made out a cheque (no 52) for the sum of $500,000, dated it 20 May 2008, payable to Greenstein Lawyers, signed it “James Jones” and deposited the cheque into Mr Greenstein’s trust account. Due to a technical issue with GE Money, the cheque was paid on presentation. Upon the clearing of this cheque Mr Greenstein made out a cheque from his trust account, to Veduta Estates Pty Ltd, dated 23 May 2008 in the sum of $500,000. The cheque (no 52) of the applicant was dishonoured on 21 May 2008 as the account of the applicant was closed.

As a result of this payment the foreclosure on the applicant’s house was delayed.

The victim, Fleur Brown, in 2008 was the company director of “Launch Management Group Pty Ltd”. This company provided public relations contract services such as media management, publicity and event management.

In late February 2008 the applicant attended Ms Brown’s business with a view to engaging her services for a two day event relating to the “Produce of Heaven”. The value of Ms Brown’s company’s services totalled approximately $36,000.

The applicant forwarded to Ms Brown, via email a number of receipts indicating she had paid several suppliers in relation to the two day event in Tasmania. One was a St George internet banking receipt number which contained a spelling error. This caused Ms Brown to doubt the authenticity of the receipt. Ms Brown was notified by several of the supplying companies that their payments were not being honoured. As a result Ms Brown called the applicant and demanded half payment of her fees before the event took place.

On 16 May 2008, the applicant contacted Ms Brown and said “I am at the ANZ Kogarah, I just deposited a cheque into your account covering the 50% deposit.” Ms Brown conducted an electronic enquiry and saw that an amount of $15,856.50 had been deposited into her account. The applicant made out a cheque (no 50) for the sum of $15,856.50, dated it 13 May 2008 payable to “Launch Management Group Pty Limited” and signed it “James Jones”. The cheque was dishonoured on 20 May 2008 because the account of the applicant was closed.

Subsequent to these offences, the applicant between 13 February 2009 and 21 April 2009 attempted to commit an offence contrary to s 135.1(1) of the Criminal Code namely dishonestly obtaining a gain from a Commonwealth entity in that she provided false documents to Oz Trade in connection with an export market development grants application form for 2007 to 2008 in the name of a company called “Produce of Heaven Pty Limited”.

Robison DCJ dealt with that matter on 4 June 2015. He convicted the applicant and ordered that she be released without passing sentence on the condition that she, upon giving security in the amount of $500 without sureties, was to comply with conditions which he imposed on her. The most important condition was that she be of good behaviour for two years.

As part of the applicant’s case in these matters, a pre-sentence report dated 16 March 2016 was placed before the Court. The authors of that report were from the Department of Corrective Services of Western Australia. The information in the report came entirely from the applicant. There was also before the Court a psychiatric report which had been obtained by the applicant.

The applicant became bankrupt in 2009 following the offending which meant that she could not run her own business. As at the date of the report she had been discharged from her bankruptcy and was living in her own home with a mortgage which she shared with one of her daughters. She moved to Perth in 2009 because of an employment opportunity. She had five children and as of the date of the report had custody of her 15 year old son. At the time of the report she was employed as an economist for the Aboriginal Housing Office.

The applicant completed a double degree in Economics and Marketing and a Masters degree in Marketing. She described a history in education and employment which was highly academic and over-achieving. The applicant’s husband left her shortly after she was made bankrupt. They are now divorced. They were married for 30 years.

The applicant agreed with the statement of facts in their entirety. She accepted that she only had her “self to blame”. She said that during the time of the offending she was experiencing extreme financial pressures. She said that her husband was suffering from depression and was not working and her elderly parents, whom she was financially supporting, had purchased a home behind her property. She had five children living at home and was constantly getting “harassed” from the bank in relation to the possible loss of her home and imminent bankruptcy.

The applicant said that she was sorry for the victims of her offending being Ms Feeney and Ms Brown. She said “It doesn’t matter if you take 10 cents from a small business it impacts on them”. She said that she was very much aware of how her dishonesty was likely to have financially impacted on both victims. Although she said that she had intentions of repaying the victims, the authors of the report noted that she had not yet done so and “she is unwilling to change some of her lifestyle factors despite her financial issues and money owed to the victims.”

The authors of the report also noted that despite recommendations by a psychologist and a psychiatrist that the applicant attend counselling and access mental health services, she had as of the date of the report not done so.

A report from Dr Olav Nielssen, psychiatrist, dated 3 September 2015 was tendered on behalf of the applicant. It would be fair to say that the history she provided to Dr Nielssen regarding her offending was somewhat coloured in her favour. She said that everyone involved in the offences had been in trouble. She said that the lawyer who had accepted the money had been disbarred and her own lawyer Ms Feeney and the loan broker were under investigation.

Doctor Nielssen diagnosed the applicant as suffering an anxiety disorder and a probable bipolar mood disorder. He expressed his opinion in these terms:

Having set out the agreed facts, his Honour said:

Having read the testimonials and the pre-sentence report, his Honour concluded that the applicant was genuinely remorseful and that the remorse and contrition was neither feigned nor expedient and he accepted the genuineness of that unreservedly.

His Honour concluded:

His Honour found that the offences were out of character. He found that the bankruptcy had a significant effect on the applicant but that nevertheless it had occurred as a result of her own fault. His Honour noted the findings of Dr Nielssen in his report. His Honour accepted that the applicant was very ashamed of her actions.

His Honour had regard to the testimonials in particular one from a Dr Trefort which described the beneficial work done by the applicant in Western Australia for farmers who were struggling at the time. She was described by her current employer as being a person of “absolute integrity and honesty”.

His Honour found:

His Honour said the following in relation to delay:

His Honour found special circumstances on the basis that this would be the first time the applicant had been in custody, she had already taken significant steps by way of rehabilitation and that she would be able to resume that rehabilitation when she was released from custody. His Honour noted that the additional time on parole would enable the applicant to better integrate into the community upon release.

These grounds of appeal were dealt with together by the applicant and it is convenient to treat them in the same way. The applicant submitted that the offending conduct could not be described as having being planned or organised within the meaning of those terms in s 21A(2)(n) of the Crimes (Sentencing Procedure) Act 1999. The applicant submitted that in response to the proposed foreclosure of her residential premises she wrote cheques on an account that had been closed for some time. The applicant submitted that at that time her behaviour was erratic, impulsive and driven by her severe sense of anxiety and distress.

The applicant submitted that in those circumstances his Honour erred when he found that there was a degree of planning.

The applicant has misunderstood what was said by his Honour in relation to planning. What his Honour said was “There must have been a level of planning involved during the course of the commission of these offences and in the time leading up to them.” At no time did his Honour purport to apply s 21A(2)(n) of the Crimes (Sentencing Procedure) Act. It is true that his Honour referred to 21A after referring to “a level of planning” but this reference was in a general sense and did not specifically relate to planning.

The approach followed by the sentencing judge was analogous to that described by Basten JA (with whom RA Hulme J agreed) in Moore v R [2016] NSWCCA 185 when his Honour explained how planning could be taken into account otherwise than by relying on s 21A(2)(n) of the Crimes (Sentencing Procedure) Act.

In Moore v R his Honour said:

In this case it can be accepted that the initial drawing of cheques which the applicant knew would be dishonoured might have been opportunistic. That cannot be said of the entire pattern of behaviour. What the applicant rapidly learned was that the signing and the use of these cheques would gain time for her and delay the sale of her house. The planning element was particularly obvious in relation to the two counts of dishonestly obtaining a financial advantage. In each of those instances the applicant told the victim that she was standing outside the bank and had just deposited monies to the account of the victim. It is clear from these instances that although the planning was not sophisticated these were not spontaneous acts and involved as his Honour found “a level of planning”.

In relation to Ground 3, the applicant submitted that the overall criminality in the offending could not be described as “significant”. The applicant submitted that the drawing of a valueless cheque by an anxious mother seeking to avoid the displacement of her family from their home was not conduct which demonstrated significant criminality.

To focus on the position of the applicant to the exclusion of the position of the victims is to distort the assessment of moral culpability, criminality and the objective seriousness of the offending. The total value of the cheques drawn by the applicant was $2,266,865. Although most of the cheques were dishonoured and no actual loss was incurred this was not the case for three of the victims. Ms Feeney lost $200,000 from her trust account. This money would have had to have been replaced by her at her own expense. This was in circumstances where Ms Feeney was acting as the applicant’s solicitor.

Although the amount involved with Ms Brown was much less, as the applicant subsequently conceded in the pre-sentence report, even a relatively small loss can be disastrous for a small business. Finally the drawing of a cheque (no 52) in the sum of $500,000 payable to Greenstein Lawyers involved a loss to the relevant financial organisation of $500,000. It matters not that the cheque was paid due to a “technical difficulty”. The fact of the matter was that the financial institution, on which the cheque was drawn, lost $500,000.

These sums of money were substantial and the circumstances in which the losses were incurred involved a significant level of moral culpability. The fact that the applicant was under financial pressure and may have been anxious at the time because of the likely loss of her home, provides little justification for the serious damage caused to Ms Feeney and Ms Brown by the applicant’s criminal conduct.

Accordingly, it was well open to his Honour to characterise the applicant’s offending as involving a “significant level of overall criminality.”

Ground of appeal 3 has not been made out.

The applicant submitted that his Honour erred in dealing with the issue of delay. The offending conduct was admitted by the applicant in documents filed in the Federal Court in April 2009. Charges were not laid until February 2014. The only possible explanation is that the applicant moved to Western Australia in 2009. No other explanation was provided by the Crown for a delay of 4 years and 10 months after admission of the offending.

The applicant relied upon a series of cases which referred to delay as a mitigating factor. The effect of what was said in those cases was that lengthy delay “can require what might otherwise be a quite an undue degree of leniency being extended to the prisoner” (R v Todd (1982) 2 NSWLR 517 at 519). The applicant noted that the courts have identified two significant aspects of delay, i.e. the opportunity for an offender to engage in substantial rehabilitation and the anxiety created by not knowing what will he happen when he or she is eventually sentenced for the offence. The applicant submitted that this was her situation during the period of the delay.

The applicant submitted that delay should have been taken into account as a significant mitigating factor and the sentence ultimately imposed should have reflected that consideration.

The question of the weight to be given to a factor in mitigation involves a discretionary exercise by the sentencing judge. In this case it is clear from what his Honour said about delay [see [44] hereof] that his Honour took delay into account as a mitigating factor. The basis of the applicant’s complaint could not be that his Honour failed to take delay into account. It could only be that he took it into account “to some limited extent”. The applicant submitted that full force and effect should have been given to the issue of delay as a mitigating factor.

It is clear from the part of the sentence judgment dealing with delay that his Honour appreciated its two important aspects, i.e. the opportunity to pursue rehabilitation and the anxiety created by the prospect of future punishment. Immediately following his Honour’s statement about taking delay into account “to some limited extent” he stressed the importance of the rehabilitation which the applicant had achieved. His Honour clearly gave that aspect of delay considerable weight.

It is also tolerably clear why his Honour expressed some limitation on the extent to which he would take delay into account. This related to the issue of anxiety at the prospect of future punishment. The applicant did not give evidence in the sentence proceedings. Despite the very substantial quantity of material placed before his Honour by way of testimonials, medical reports, and the pre-sentence report there was no evidence in terms that the applicant was in fact anxious about the prospect of future punishment. There was no evidence at all concerning that matter. Accordingly, on that state of the evidence his Honour was entitled to impose a limit on the extent to which he took that aspect of delay into account.

That a sentencing judge has a wide discretion as to the weight to be given to the issue of delay was made clear by Price J in Luong v R [2014] NSWCCA 129 where his Honour said:

Finally, the modest sentence imposed by his Honour despite the seriousness of the offending, is strongly indicative that his Honour did give delay and particularly the level of rehabilitation achieved by the applicant, considerable weight.

I have concluded that there is no error in the way in which his Honour dealt with delay and that this ground of appeal has not been made out.

If I am wrong in that assessment and error were to be found in his Honour’s treatment of delay it would be necessary to review the facts and re-sentence the applicant. In carrying out that review it would be also necessary to take into account relevant matters which have occurred since the applicant was originally sentenced. In carrying out that exercise, were it necessary, I am not persuaded that any lesser sentence than that imposed by his Honour is justified. I have reached that conclusion because of the very serious nature of the offending and the importance when considering this type of offending of general deterrence. This is despite the considerable progress in rehabilitation achieved by the applicant between 2009 and May 2016 when she was sentenced.

Accordingly the orders which I propose are:

R A HULME J: I agree with the orders proposed by Hoeben CJ at CL and with his Honour’s reasons.

Nothing turns on it for the purposes of this appeal but the following from the passage of the sentencing judgment quoted by Hoeben CJ at CL at [38] cannot pass without comment:

“Where relevant I take into account any aggravating features and mitigating features as set forth in the provisions of s 21A of the Crimes (Sentencing Procedure) Act.”

Such a statement is meaningless; it conveys nothing to the offender, the community, or this Court about what has been taken into account and what significance it had in the assessment of sentence. The use of such a formulation has been criticised by this Court since at least 2005: see the judgment of Bellew J in R v RMW [2016] NSWCCA 211 and the examples he cited at [45]-[48]. As Wood CJ at CL observed in R v Mills [2005] NSWCCA 175; 154 A Crim R 40 at [39], "more is expected than mere lip service to the legislation".

SCHMIDT J: I agree with Hoeben CJ at CL.