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Court of Criminal Appeal 9 April 2010

Nahlous v R

[2010] NSWCCA 58

Also reported as (2010) 77 NSWLR 463 (2010) 201 A Crim R 150
Fraud & dishonesty
CRIMINAL LAW SENTENCE POSSESSION CHARGE AN ABUSE OF PROCESS

Citation: Nahlous v R [2010] NSWCCA 58
Court: NSW Court of Criminal Appeal
Date: 9 April 2010
Judge(s): McClellan CJ at CL, Howie J, Rothman J

Background

The applicant pleaded guilty in the Local Court to six offences under the Copyright Act 1968 (Cth) relating to the sale or offering to sell unauthorised television decoders. These devices allowed users to access pay television services without a subscription. He also pleaded guilty to a further offence under s 400.6(1) of the Criminal Code 1995 (Cth), which concerns dealing in the proceeds of crime.

The proceeds offence arose directly from a single transaction: the applicant sold 50 decoders to an undercover police officer and received $15,000 in cash, which was recovered immediately after his arrest. The District Court sentenced the applicant across all seven counts, with the proceeds offence attracting the heaviest penalty: 20 months' periodic detention with a non-parole period of 12 months.

The applicant sought leave to appeal against the sentence imposed for the proceeds offence only, arguing it was disproportionate to the underlying criminality.

  • Whether the sentence for the proceeds offence under s 400.6(1) of the Criminal Code was manifestly excessive or disproportionate to the applicant's criminality
  • Whether the sentencing judge properly applied the totality principle when structuring the sentences
  • Whether charging the applicant with a proceeds offence arising from money handed over by an undercover officer in a controlled transaction constituted an abuse of process
  • Whether the proceeds charge was of a trivial nature warranting dismissal under s 19B(1)(c) of the Crimes Act 1914 (Cth) rather than resentencing

Decision

The Court found several difficulties with the District Court's sentencing structure. The same six-month sentence had been imposed for selling a single decoder and for selling 50 decoders, despite the obvious difference in criminality. All sentences were made concurrent despite the offences being separate and distinct, committed over nine months. The Court also found it difficult to reconcile the stated 20 per cent discount for early plea with the sentence figures actually imposed.

More fundamentally, the Court concluded that the proceeds charge itself was an inappropriate use of the s 400.6(1) offence on these facts. The $15,000 was handed over by an undercover officer who never intended the applicant to keep it, and the money was recovered immediately on arrest. The applicant was arrested before he could deal with or move the funds, and there was no transformation of the proceeds in any meaningful sense. The Court observed that the undercover operation could have concluded with an arrest before money changed hands, and saw no forensic purpose in the payment other than to secure evidence of the sale.

The Court also noted a structural problem in the way the Crown used the proceeds charge. Because the decoder offences were inadequately sentenced at first instance, the Crown sought to rely on the higher-maximum-penalty proceeds offence to lift the overall sentence to a level reflecting the true criminality. The Court rejected this approach, finding the proceeds charge was not the principal offence and should not have been treated as such.

Having found the proceeds charge to be of a trivial nature in the particular circumstances, and that it was inexpedient to impose punishment for it, the Court dismissed the charge under s 19B(1)(c) of the Crimes Act 1914 (Cth). The Court acknowledged that this left the decoder offences under-punished, but attributed that outcome largely to the Crown's decision to structure the prosecution as it did.

Orders Made

  • Leave to appeal against sentence for the s 400.6(1) proceeds offence granted
  • Sentence imposed in the District Court for that offence quashed
  • Charge under s 400.6(1) of the Criminal Code dismissed pursuant to s 19B(1)(c) of the Crimes Act 1914 (Cth)

Key Takeaways

  • A proceeds of crime charge under s 400.6(1) of the Criminal Code 1995 (Cth) may constitute an abuse of process where the money in question was handed over by an undercover officer with no intention of allowing the accused to keep it, and was recovered immediately upon arrest.
  • Under s 19B(1)(c) of the Crimes Act 1914 (Cth), a court may dismiss a charge without recording a conviction where the offence is of a trivial nature and it is inexpedient to inflict punishment, even where no conviction appeal has been brought.
  • Imposing identical sentences for offences of materially different gravity, and ordering all sentences to run concurrently despite the offences spanning nine months, revealed a failure to properly apply established sentencing principles, including the totality principle and the requirement articulated in Pearce v The Queen to assess each offence individually before considering accumulation.
  • Structuring a prosecution so that a high-maximum-penalty ancillary charge carries the burden of reflecting overall criminality, while the principal offences are inadequately sentenced, is an approach the Court of Criminal Appeal declined to endorse.
  • Where an inadequate sentence for the principal offences results partly from the Crown's own charging decisions, the Court may decline to remedy that inadequacy by maintaining a legally problematic ancillary sentence.

Legislation and Cases Referenced

Legislation:
- Criminal Code 1995 (Cth), s 400.6(1)
- Crimes Act 1914 (Cth), ss 19B(1)(c), 20(1)(b)
- Copyright Act 1968 (Cth), ss 135ASB(1), 135ASC(1)
- Criminal Appeal Act 1912 (NSW), s 6(3)

Cases:
- Pearce v The Queen [1998] HCA 57; (1998) 194 CLR 610
- R v Janceski [2005] NSWCCA 288
- Arnaout v R [2008] NSWCCA 278; 191 A Crim R 149
- Thorn v R [2009] NSWCCA 294