Aitken v The Queen [2002] FCAFC 274 (28 August 2002)

Last Updated: 30 August 2002

FEDERAL COURT OF AUSTRALIA

Aitken v The Queen [2002] FCAFC 274

CRIMINAL LAW - sentencing - appellant convicted of multiple charges of theft, make and use false instrument - "white collar" crime - severity

WARREN JOHN AITKEN v THE QUEEN

A 5 of 2002

HIGGINS, MADGWICK AND WEINBERG JJ

28 AUGUST 2002

CANBERRA

IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY	A 5 of 2002

BETWEEN:	WARREN JOHN AITKEN APPELLANT
AND:	THE QUEEN RESPONDENT

JUDGE:	HIGGINS, MADGWICK & WEINBERG JJ
DATE OF ORDER:	28 AUGUST 2002
WHERE MADE:	CANBERRA

THE COURT ORDERS THAT:

1. The appeal be dismissed. Time served is to count.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY	A 5 of 2002

BETWEEN:	WARREN JOHN AITKEN APPELLANT
AND:	THE QUEEN RESPONDENT

JUDGE:	HIGGINS, MADGWICK AND WEINBERG JJ
DATE:	28 AUGUST 2002
PLACE:	CANBERRA

REASONS FOR JUDGMENT

THE COURT:

Introduction

1 On 8 November 2001 the appellant pleaded guilty in the Magistrates Court of the Australian Capital Territory to five counts of theft, six counts of "make false instrument/own use" and six counts of "use false instrument". The offence of theft is contrary to s 89 of the Crimes Act 1900 (ACT) ("the Crimes Act"). The offences of "make false instrument" and "use false instrument" are contrary to s 126 of the Crimes Act. Each of the offences carries a maximum penalty of ten years' imprisonment.

2 The appellant was committed for sentence to the Supreme Court of the Australian Capital Territory. He adhered to his pleas of guilty and was sentenced by Miles CJ on 19 February 2002 as follows: on the first count of theft which he committed (CC8482): two years' imprisonment; on the first count of make false instrument (CC8483) and the first count of use false instrument (CC8484): two years' imprisonment on each, to be served concurrently with each other but cumulative upon CC8482. On each other count: two years' imprisonment to be served concurrently, but cumulative upon the first two charges.

3 The total effective head sentence thereby to be served amounted to six years' imprisonment. His Honour specified a non-parole period of two years to commence on 19 February 2002 and to expire on 19 February 2004.

4 The appellant appeals against his sentences. His amended Notice of Appeal sets out the following grounds:

"As to sentence:

1. That sentence was manifestly excessive.

2. That his Honour failed to give sufficient weight to the appellant's subjective features.

3. That his Honour placed insufficient weight upon the early plea of guilty of the defendant.

4. The learned sentencing judge erred in failing to find that the appellant:

(a) suffered from a chronic major depressive disorder; and

(b) as such was an inappropriate vehicle for general deterrence.

5. The learned sentencing judge erred in failing to discriminate between counts in the sentences that he imposed on each count.

6. The learned sentencing judge erred in finding that Dr and Mrs Trethewey had lost virtually all their life savings

(a) in the absence of evidence

(b) without raising the prospect of that finding being made with counsel for the appellant

(c) when the finding was wrong.

7. The learned sentencing judge erred in failing to take into account the unpaid charitable work of the appellant between March 2001 and January 2002."

5 Ground 2 was not pressed.

Facts

6 The nature of the offences was described by Miles CJ in the following way:

"The offender carried on business as a financial advisor. He had control of substantial sums of money belonging to clients, which he held on trust to invest on their behalf. Apparently he had some authority to sign cheques, but it was a limited authority which he exceeded from time to time. He was also a director of a company, or companies, involved in what was called the Stables project, which was a land and building project in the Perisher Valley in New South Wales. The project got into trouble, and in an attempt to keep it afloat the offender made his clients' monies available to the project without the consent of the clients, and in one case against express instructions. The project ultimately failed, at least to the extent that the clients' money has, for all practical purposes, been rendered irretrievable from the offender or from anyone else.

The offender was a director in particular of two companies, one called Muskelm Pty Ltd, which as I understand it was later replaced by another company called Midika Pty Ltd. These companies appear to have acted as some sort of conduit for the purposes of the Stables project. The offender was also liable on guarantees given to the Westpac Bank in respect of the indebtedness of those companies, and possibly others, to the bank.

Thus on 25 November 1999, when it appears that the difficulties with the project began to become substantial, the offender drew a cheque for $85,000 from the Crowley Family Estate Trust account. By a series of transactions he directed that money so that it was credited against a debt owing to the Westpac Bank by one or more of the participants in the Stables project. In an attempt to make these transactions appear legitimate, the offender produced a letter making it look as if the $85,000 was a loan from the Crowley Family Estate Trust for 30 days to some entity called the First Opportunities Trust, which it clearly was not. The charge of theft was appropriate to the facts, and the plea of guilty properly offered since the offender treated the $85,000 as his own. The false instrument was the cheque for $85,000, the making and use of which was not authorised by Ms Crowley, the representative of the trust from whom Mr Aitken received his instructions.

On 3 March 2000 the offender met with a client, Mr Don Nott, and suggested that Mr Nott might like to invest monies in the Stables project from the trust account called the Don Nott Real Estate Pty Ltd Superannuation fund. Mr Nott rejected this suggestion. He instructed the offender to invest $50,000 in another fund altogether, which was described as a pooled share trading fund. The following day Mr Nott reduced the amount authorised in this way to be invested to $30,000. Mr Nott gave the offender a cheque for $30,000 for that purpose, and signed an authority for the payment of that amount to Laseron Pty Ltd, a company controlled by the offender. The offender forged the signature of Mrs Nott on the same document.

On 16 March the offender arranged for units to the value of $30,000 to be issued from, or by, the Stables project to Mr and Mrs Nott, and arranged for the cheque to be paid into a bank account held by Midika, or Muskelm, but at any rate for the purpose of the Stables Project.

On 16 March 2000 the offender, without authority, drew a cheque on the Trethewey Superannuation Fund Trust account for $60,624. He also forged the signatures of Dr and Mrs Trethewey, the two directors of the company, on whose behalf the trust account was held, on applications for units in the Stables Project. He thereby arranged for those units to be issued in the name of Dr and Mrs Trethewey, and the proceeds of the cheque to be deposited into one of the accounts held by Midika Pty Ltd. A similar withdrawal was made on 24 May 2000, followed by a forged application for units, and payment in effect to the benefit of the Stables project of $100,000, and similarly on 25 May 2000 of $150,000.

Thus the Trethewey Family Superannuation Fund was deprived of the sum of $310,624, the Crowley Family Trust of $85,000, and the Nott Superannuation Fund of $30,000, a total of $425,624. True it is that this very substantial loss to the persons and funds was not followed by any obvious windfall to the offender. However at some stage during the period his own family superannuation fund purchased units in the Stables project to the value of $20,000 and, as I have said, he was a guarantor of some of the debts incurred in the project. To that extend the offender stood to gain by channelling his clients' funds into the Stables Project, with the intent that those funds would help save it from financial failure."

Nature of appeal against sentence

7 The High Court has recently re-stated the requirements for a successful appeal against sentence in Dinsdale v The Queen [2000] HCA 54; (2000) 202 CLR 321. At 339-40 Kirby J (Gaudron and Gummow JJ agreeing) said:

"The necessity to show error ... is fully accepted by courts deciding appeals against sentence ... Because the imposition of a sentence involves the exercise of judgment and evaluation upon which minds can differ, it bears close similarities to the making of a discretionary decision. Like such a decision, if properly imposed, a sentence will not be disturbed on appeal merely because the appellate court would have reached a different result had the responsibility of sentencing belonged to it. As in the case of appellate review of a discretionary decision, a brake is imposed upon undue appellate disturbance of primary decisions (and unwarranted appeals seeking that relief) by the necessity to identify an error that justifies and authorises appellate intervention. Such an error may involve the adoption by the primary judge of an incorrect principle, giving weight to some extraneous or irrelevant matter, failing to give weight to some material considerations, or a mistake as to the facts."

8 We deal with the grounds of appeal in the order in which they were presented in the appellant's written submissions.

The significance of the appellant's clinical depression

9 It is true that his Honour did not refer to the appellant's condition as "depression". However, his Honour spoke of "causes of stress" to the appellant and clearly viewed the major such cause as being problems associated with the development project. This must be understood in the light of the evidence as to depression. A psychologist, Dr Stevens, diagnosed the appellant as meeting the criteria in the psychiatric standard known as "DSM-IV" for "Major Depressive Order, Chronic". As at the time of sentence, the psychologist considered that the appellant's condition was "mild" but had previously been "moderate-severe". The appellant's business dealings were "the primary cause of the depression". Dr Stevens offered the following opinions:

"Mr Aitken has no previous criminal history. While the offences are serious, there were significant situational pressures that led to his sense of desperation. I do not think that he has any traits of personality disorder, including Antisocial, and that there is minimal risk of any future re-offence (low on a range of low-moderate-high) especially if he avoids work in financial planning.

I think that there are risks involved with a custodial sentence. He has continuing depression. While there has been a significant improvement he is vulnerable to a deterioration in his mood. Of particular concern is the high risk of suicide as identified in the psychological testing."

10 It relevantly emerged from the appellant's history to Dr Stevens that:

* The appellant "did not consider [his wife's] illness to be a large stressor at the time of the offences";

* The appellant had had "counselling" from his religious minister "with approximately 20 sessions 1997-2001";

* "over December 2000 and January 2001 he became suicidal" and he had sought medical treatment for this;

* the appellant "knew that [before October 1999] he had given advice to his clients outside the guidelines and the `recommended list' of his association ... He said that he was motivated in part [by] `some self-preservation'.

11 In our opinion his Honour used the term "stress" as a lay person's synonym for the depression. It is not the case that his Honour took no account of the depression.

12 In any case, it is not trivialising the possible seriousness and relevance of depression to say that the appellant's depression appears not to have been as serious as is commonly seen in many criminal cases. It is clear that the appellant acted at all times with the knowledge of what he was doing and of the gravity of his actions.

13 Questions of principle would in any case arise as to the significance for sentencing of psychological illness and disorder. The case sought to be made was that the appellant should not be imprisoned at all. The proper approach, we think, was outlined in Wright (1997) 93 A Crim R 48, Hunt CJ at CL (with whom Gleeson CJ and Hidden J agreed) said at 50-51:

"It is an accepted principle of sentencing that general deterrence should often be given very little weight in the case of an offender suffering from a mental disorder or abnormality because such an offender is not an appropriate medium for making an example to others. In most of the cases in which that principle is applied, the offender has suffered from a significant mental illness or retardation, but such a condition is not a necessary condition for the principle to be applied. Considerations of general (or even personal) deterrence are not rendered completely irrelevant, and the significance of the offender's mental incapacity is to be weighed and evaluated in the light of the particular facts and circumstances of the individual case. The reason for the principle is that the interests of society do not require such persons to be punished as severely as persons without that disability because such severity is inappropriate to their circumstances. The full understanding of the authority and requirements of the law which is attributed to the ordinary individual of adult intellectual capacities cannot be expected of a person whose intellectual function is insufficient to have that understanding. The means by which the courts give effect to that principle (as an instrument of social administration) is to moderate the consideration of general deterrence to the circumstances of the particular case. But, if the offender acts with knowledge of what he is doing and with knowledge of the gravity of his actions, the moderation need not be great."

14 Like principles had been adopted by this Court in Parnis v The Queen [1993] FCA 624; (1993) 49 FCR 304, with the gloss that they were not limited to `severe' mental disorders or abnormalities (at 305). Such an approach was recently followed in this Court in IN v The Queen [2002] FCAFC 135. As was said by the Court at [25]:

"Counsel for the appellant argued that the learned sentencing judge should not have made any allowance for general deterrence when composing the sentencing package. That submission cannot succeed. Making every allowance for the appellant and his mental condition, there was still a justifiable reason to have regard to matters of both special and general deterrence. There is no rule of law that general deterrence is irrelevant when an offender has a psychological disorder, nor is there a rule of law that general deterrence can only be given slight weight in sentencing such a person. Each case is to be decided on its own facts.'

Weight given to plea of guilty

15 We accept that it is desirable (though it is not mandatory: Wong v R [2001] HCA 64; (2001) 185 ALR 233 at 252-3 per Gaudron, Gummow & Hayne JJ) that a sentencing judge should state clearly that the fact that the prisoner has pleaded guilty has been a factor in the judge's consideration of the sentence: failure to do so may, depending on the circumstances, lead to an inference that the plea was not given the weight that should ordinarily attach to it.

16 However, in this case, we do not accept that such an inference should be drawn. His Honour said that the prisoner had "continued [his] pleas of guilty initially entered into in the Magistrates Court". In this case, of even more significance was that the appellant "walked in", as it was put in submissions, to the police: as his Honour said "the offender, of his own initiative, went and made full admissions to the police". As well, his Honour clearly accepted that there was an "unusual degree" of contrition. The early pleas were part of the evidence of such contrition. Further, the shortness of the non-parole period in itself is an indicator that every mitigatory factor for the prisoner was amply taken into account.

Same sentences on each count

17 Any error that his Honour might have made in this regard was, in our view, merely of a technical kind and, if anything, had an effect in favour of the appellant. Principle requires, as the appellant submits, that each term of imprisonment should reflect the gravity of the particular offence for which it is imposed. But, as a practical matter, the appellant's submission serves merely to fasten attention on the lack of merit of his case insofar as it asserts overall severity. The head sentence for the first stealing count (Crowley family) could well have been eighteen months: it could not be described as an isolated criminal act. The fact that there were associated and subsequent offences would operate to disentitle the appellant from the degree of leniency that a single offence might attract. A sentence of two years could hardly be regarded as appellably excessive. Likewise, a head sentence of two years for each of the first counts of make false instrument and use the same could not be regarded as appellably excessive, though in each case it would be high. Technically, it was probably an error of principle to make them cumulative upon the sentence for the first stealing count: the three offences related to the one dishonest transaction. As will be seen, however, it would be pointless to correct this. Each subsequent offence represented a compounding of the earlier criminality. The second (Nott) and third (Trethewey) stealing matters would each properly attract terms of imprisonment of no less than two years and there would need to be some degree of accumulation of them upon the sentence for the first stealing count. Each of the fourth and fifth stealing counts, if sentenced alone, but having regard to the earlier criminality, and subject to considerations of totality, would attract a sentence at the higher end of the available range. Properly analysed, there would be nothing unacceptable about a six year sentence for each of those later counts, notwithstanding that it would be a heavy sentence. Thus, not only was there no error which had any practical consequence in his Honour's actual sentences for the individual counts, there was likewise no erroneous result from the accumulation method which his Honour chose.

18 If his Honour made any other error, it was in not pronouncing higher individual sentences for the later offences and making them wholly or partly concurrent with the sentences for the first set of offences. But, in the circumstances, this is an empty quibble. It cannot and should not attract appellate intervention in the absence of a Crown appeal aimed at increasing any particular sentence imposed.

19 Viewed in this way, the leniency of the non-parole periods is also exposed. In all the circumstances, the non-parole period for the first stealing offence could not have been less than six months. By the time one reaches and takes into account the fifth principal offence, being the theft of $150,000 from the elderly Tretheweys by their trusted advisor and friend (bringing the total amount stolen from them to over $300,000) and granted that a six year effective head sentence is acceptable, it is a quite misconceived grievance that causes complaint to be made of a non-parole period equal to one third of the head sentence. As to the non-parole period in particular, but also as to the sentences seen as an entire package, as the sentencing judge intended them, the appellant was treated with ample leniency in relation to the important matters that counted in his favour.

Mistaken finding

20 His Honour found that the Tretheways had lost virtually their life savings. There was actually no evidence of this. It was however an error without practical consequence. The unchallenged evidence was that Dr Tretheway, a retired medical practitioner, was reduced to needing to return to medical practice. Had his Honour correctly recorded that evidence, it is inconceivable that any different sentence would have been pronounced.

Manifestly excessive

21 The major matters referred to were:

* the appellant did not take his victims' money with the intention of pocketing it;

* his walk-in to the police and prompt pleas of guilty;

* his depression;

* his well-advanced rehabilitation, including considerable volunteer work with a local charity group;

* his previous good character.

22 The appellant did not, however, act selflessly and, in any case, his motives are no comfort to his victims. To try to rectify the consequences of his own misjudgment, he betrayed people who had trusted him and were vulnerable to him. His crimes extended over a period of six months. His methods were devious, complex and showed forethought. Nevertheless, it was inevitable that his crimes would soon have come to light and they would have been easily enough proved. His victims, especially the Tretheweys, have lost large sums of money. The appellant had the advantages of maturity, a tertiary education, integration into the cultural mainstream and middle class comforts. His stress and depression, although real and significant, though doubtless contributory factors to his repeated lapses of judgment, were hardly extraordinary.

23 It is trite that the primary consideration in sentencing is the seriousness of the crime. This was an instance of "white collar" crime. The repeated statements by Australian courts urging the condign punishment of such criminality ought not be treated as the expression merely of pious hopes. A heavy, effective head sentence was, in principle, inescapable. There was room for more leniency in relation to the non-parole period and such leniency was generously granted: see [18] above. The sentence was not manifestly excessive.

Disposition

24 The appeal is dismissed. Time served is to count.

I certify that the preceding twenty-four (24) numbered paragraphs are a true copy of the Reasons for Judgment herein of this Honourable Court.

Associate:

Dated: 28 August 2002

-

Counsel for the Appellant:	Mr Gillespie-Jones
Solicitor for the Appellant:	Gillespie-Jones & Co
Counsel for the Respondent:	Mr Refshauge SC
Solicitor for the Respondent:	Director of Public Prosecutions (ACT)
Date of Hearing:	13 August 2002
Date of Judgment:	28 August 2002