Citation: R v Ida Ronen, Nitzan Ronen, Izhar Ronen [2006] NSWCCA 123
Court: New South Wales Court of Criminal Appeal
Date: 19 April 2006
Judge(s): Spigelman CJ, Kirby J, Howie J
Background
Three members of a family, a mother and her two sons, were convicted after a lengthy trial before Whealy J of two counts of conspiring to defraud the Commonwealth of taxation revenue. The offences arose from the operation of a clothing retail and wholesale business with substantial cash turnover. Over approximately a decade, the conspirators concealed between $15 million and $17 million in cash income, distributing the undeclared funds among themselves and sending much of it overseas. The trial judge found the offences fell within the worst category of their type.
The offending spanned two legislative regimes, which is why there were two separate counts on the indictment. After the offences were committed but before sentencing, Parliament repealed the relevant provisions of the Crimes Act 1914 (Cth) and introduced new fraud offences under the Criminal Code (Cth) carrying a lower maximum penalty. The sentences imposed were: eight years and six months total imprisonment for the mother, with a non-parole period of four years and six months; and eight years and six months for each son, with non-parole periods of five years and six months.
Both sides appealed. The three applicants sought leave to appeal against what they argued were excessive sentences. The Crown separately appealed, contending the sentences were manifestly inadequate for offences found to be in the worst category.
Legal Issues
- Whether the maximum penalty applicable to the Crimes Act offences was reduced by subsequent legislative changes introducing the Criminal Code fraud offences with lower maximum penalties.
- Whether the payment of penalty tax by the applicants prior to sentencing was a relevant mitigating factor.
- Whether partially cumulative sentences were appropriate where the Crown alleged only a single underlying conspiracy, split across two counts due to legislative change.
- Whether the sentences imposed were manifestly excessive (applicants' grounds).
- Whether the sentences imposed were manifestly inadequate given the trial judge's finding that the offences were in the worst category (Crown's grounds).
- Whether the creation of new offences with reduced maximum penalties under the Criminal Code was relevant to sentencing for the earlier Crimes Act offences.
Decision
The court confirmed that the maximum penalty formally applicable to the Crimes Act offences remained at 20 years imprisonment, as the legislative change did not retrospectively reduce that maximum. However, the court held that the introduction of the new Criminal Code fraud offences, carrying a lower maximum, represented a change in legislative policy toward this category of offending. That policy change was properly taken into account by the sentencing judge as relevant to the weight to be given to the 20-year maximum as a yardstick.
On the relevance of penalty tax, the court accepted that the payment of substantial penalty tax before sentencing was a legitimate mitigating consideration. Combined with the changed legislative policy, this meant the individual sentences, though perhaps low relative to a strict comparison with the 20-year maximum, were within the sentencing judge's discretion.
The court addressed the partial accumulation of the two counts. Because the counts arose from what was in substance a single ongoing conspiracy divided only by the change in legislation, the judge's approach of partially accumulating the sentences was appropriate. The total sentence of eight and a half years was within the judge's legitimate discretion in these unusual circumstances.
The Crown's appeal was dismissed. The court rejected the submission that, because the offences were in the worst category, a total sentence of eight and a half years was necessarily inadequate. The unusual sentencing circumstances, particularly the change in legislative policy and the penalty tax paid, justified the judge's approach.
Orders Made
- Leave to appeal granted to the applicants, but the appeal dismissed.
- Crown appeal dismissed.
Key Takeaways
- A subsequent legislative reduction in maximum penalties for equivalent offences does not automatically reduce the maximum applicable to earlier offences charged under repealed provisions, but the change in legislative policy is nonetheless a relevant sentencing consideration.
- Where a sentencing judge finds offences fall within the worst category of their type, that finding does not mechanically require a sentence near the statutory maximum if other circumstances, such as changed legislative policy and pre-sentence payment of penalty tax, bear on the appropriate range.
- Payment of penalty tax prior to sentencing was accepted by the Court of Criminal Appeal as a legitimate mitigating factor in proceedings for Commonwealth tax fraud.
- Partially cumulative sentences across two counts were held appropriate where the counts arose from a single underlying conspiracy divided only because the governing legislation changed during the period of offending.
- In dismissing both the applicants' and Crown's appeals, the court confirmed that sentencing judges retain a legitimate discretion to depart from a strict application of the maximum penalty as a guide where unusual statutory circumstances render that maximum an unreliable measure of legislative intent.
Legislation and Cases Referenced
Legislation:
- Crimes Act 1914 (Cth), ss 4F(2), 29D, 86A, 86(2)
- Criminal Code (Cth), s 135.4
- Criminal Code Amendment (Theft, Fraud, Bribery and Related Offences) Act 1999 (Cth)
- Financial Transaction Reports Act 1988 (Cth), s 31
- Acts Interpretation Act 1901 (Cth), ss 8, 45A
- Crimes Legislation Amendment Act 1987 (Cth)
- Income Tax Assessment Act 1936 (Cth), s 226J
- Tax Laws Amendment Self-Assessment Act 1992 (Cth)
- Criminal Appeal Act 1912 (NSW), s 6(3)
- Sentencing Act (WA), s 10
Cases:
- Peters v The Queen (1998) 192 CLR 493
- Markarian v The Queen (2005) 79 ALJR 1048
- Pearce v The Queen (1998) 194 CLR 610
- Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Limited (2003) 216 CLR 161
- Grey v Motor Accident Commission (1998) 196 CLR 1
- Rich v Australian Securities and Investment Commission (2004) 220 CLR 129
- R v Melville (2003) 27 WAR 224
- R v Simpson (2001) 53 NSWLR 704
- R v Hammoud (2000) 118 A Crim R 66
- Chief Executive Officer of Customs v Derbas (2002) 167 FLR 269
- R v O'Connor (2002) 129 A Crim R 505
- Elias v Commissioner of Taxation (2002) 199 ALR 246