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District Court 13 October 2006

R v Thomas Douglas WATKINS

[2006] NSWDC 54

Fraud & dishonesty
CRIMINAL LAW DISHONESTY SENTENCE GAMBLING BREACH OF TRUST

Citation: R v Thomas Douglas Watkins [2006] NSWDC 54
Court: District Court of New South Wales
Date: 13 October 2006
Judge(s): Berman SC DCJ

Background

The offender was employed as financial controller for Tasman KB Pty Limited, a timber wholesaling company with offices in Sydney, Brisbane, and Melbourne. Although he was not a signatory to the company's bank accounts, his role required him to prepare cheques for authorised signatories to sign. He exploited this position by presenting cheques to a director that appeared, on their face, to authorise inter-account transfers between the company's Brisbane and Sydney accounts.

In reality, the offender had left a deliberate gap in the payee line of each cheque. After the director signed them, he inserted his own name into that gap, so each cheque read "Pay T Watkins Westpac St Marys" instead of simply "Pay Westpac St Marys." He then deposited all 43 cheques into his personal account and spent the proceeds gambling, misappropriating a total of more than $2 million over approximately three years.

The offender pleaded not guilty and contested all 43 charges at trial. He gave evidence claiming the cheques already bore his name when the director signed them, but the jury rejected his account. A forensic document examiner established that the inserted words were written with different ink and appeared physically squashed into pre-existing gaps, fatally undermining his defence.

  • What sentence was appropriate for 43 counts of fraud under section 176A of the Crimes Act 1900, each carrying a maximum of 10 years imprisonment?
  • Whether the principle against imposing a longer sentence on retrial following a successful conviction appeal applied, and whether any circumstances justified departing from it.
  • Whether the offender's breach of trust constituted a separately aggravating feature under the sentencing legislation, or was already implicit in the offences.
  • Whether special circumstances existed to justify adjusting the ratio between the non-parole period and the head sentence.

Decision

The court declined to treat breach of trust as a separately aggravating feature under section 21A of the Crimes (Sentencing Procedure) Act 1999, finding it was already implicit in the nature of the offences. Nonetheless, Berman SC DCJ emphasised that the breach was significant given the offender's professional standing and the degree of reliance the company had placed in him. The court also noted that the offender had previously been convicted of 37 counts of larceny as a clerk against John Fairfax and Sons Limited in the early 1980s, involving over $700,000, and had received a custodial sentence for those matters. This history deprived him of any claim to good character.

On the retrial sentencing principle, the court acknowledged the general rule established in R v Gilmore that a judge sentencing after a successful appeal should not ordinarily exceed the original sentence. The rationale is to preserve the right to appeal without fear of a harsher outcome on retrial, and to avoid any appearance of retribution. However, the court found that several circumstances justified departure from that principle here. The present proceedings involved more counts and a greater sum than the first trial, no accumulation of sentences had been ordered by the original judge, an outstanding Crown appeal had not been resolved, and Berman SC DCJ considered the original overall sentence inadequate.

The offender's age of 67, his medical conditions including high blood pressure, migraines, and gout, and the fact that he would spend a significant portion of his remaining years in custody were all taken into account. The court found these factors warranted some mitigation but did not justify a substantial reduction. The court also noted that the absence of any remorse and the need for specific deterrence remained relevant, given that the offender had previously offended in essentially the same way against a different employer. Special circumstances were found, primarily on account of age, justifying a modest adjustment to the non-parole to head sentence ratio, though not as favourable an adjustment as the defence had sought.

Orders Made

  • Counts 1 to 7: non-parole period of 4 years and 6 months commencing 28 July 2005, expiring 27 January 2010; head sentence of 5 years.
  • Counts 8 to 21: non-parole period of 3 years and 6 months commencing 28 July 2006, expiring 27 January 2010; head sentence of 5 years.
  • Counts 22 to 43: non-parole period of 2 years and 6 months commencing 28 July 2007; head sentence of 5 years.
  • Overall effect: head sentence of 7 years with a non-parole period of 4 years and 6 months, with eligibility for release to parole on 27 January 2010.

Key Takeaways

  • The District Court confirmed that breach of trust may be implicit in the nature of an offence under section 176A of the Crimes Act 1900 and therefore does not automatically constitute a separate aggravating factor under section 21A of the Crimes (Sentencing Procedure) Act 1999, even where the breach is serious.
  • Prior convictions for substantially similar dishonesty against a previous employer will deprive an offender of any discount for good character and may reinforce the weight given to specific deterrence.
  • The general principle from R v Gilmore, that a sentencing court should not exceed the original sentence following a successful conviction appeal, is not absolute. Departure may be justified where the retrial involves additional counts, greater losses, an inadequate original sentence, or an unresolved Crown appeal.
  • An offender's advanced age and health conditions are relevant mitigating factors in sentencing, but the District Court found they did not warrant substantial reduction where the offending was serious, prolonged, and repeated a prior pattern.
  • Special circumstances justifying an adjusted non-parole period ratio may be found on the basis of age alone, though the extent of any adjustment remains at the sentencing court's discretion and will be weighed against the overall gravity of the conduct.

Legislation and Cases Referenced

Legislation:
- Crimes Act 1900 (NSW), section 176A
- Crimes (Sentencing Procedure) Act 1999 (NSW), section 21A

Cases:
- R v Gilmore (1979) 1 A Crim R 416