Citation: Chang v R [2016] NSWCCA 296
Court: NSW Court of Criminal Appeal
Date: 16 December 2016
Judge(s): Macfarlan JA (leading judgment); Johnson J and Schmidt J (agreeing)
Background
The appellant was an employee of a group of companies effectively owned and controlled by one of his alleged co-conspirators. Following a ten-week trial in the District Court, a jury found him guilty of conspiring with two others, between January 2002 and June 2006, with the intention of dishonestly causing a loss to the Commonwealth, contrary to s 135.4(3) of the Criminal Code (Cth). He was sentenced to five years imprisonment with a non-parole period of three years.
The Crown's case centred on a property development group that included JKC Developments Pty Ltd (the GST-reporting entity), High Trade Constructions Pty Ltd, and Lobbyfit Design & Cons Pty Ltd. The alleged scheme involved JKC lodging GST returns that claimed refunds based on invoices from other entities within the same corporate group, which were either inflated or entirely false. The ATO paid out those refunds, and when JKC was later placed into administration and then liquidation, the overpaid amounts became irrecoverable.
The Crown identified two distinct schemes within the conspiracy: one arising during the construction phase of a Chippendale residential development (yielding alleged excess GST refunds of approximately $1.26 million), and one arising after practical completion involving further inflated HTC invoices and false Lobbyfit invoices (yielding alleged excess refunds of approximately $1.73 million combined). The appellant appealed against his conviction and sought leave to appeal against sentence.
Legal Issues
- Whether the trial miscarried because the Crown's submissions left the conspiracy undefined, elided key elements, or were internally inconsistent
- Whether the offence as charged was unknown to the criminal law, warranting an acquittal
- Whether the jury directions were sufficiently clear, or were internally inconsistent and confusing, rendering the verdict uncertain or unsafe
- Whether the indictment was latently duplicitous, such that the verdict was uncertain
- Whether the verdict was unsafe because it required proof that the appellant intended loss to crystallise upon liquidation, which was not established
- Whether a combination of errors, considered cumulatively, produced a miscarriage of justice
- On sentence, whether the sentencing judge made adequate findings as to the appellant's role, the scope of the conspiracy, and whether the intended loss was permanent rather than merely temporary
Decision
Macfarlan JA dismissed all grounds of the conviction appeal. His Honour found that the Crown's case was coherently presented throughout the trial as an allegation that the appellant agreed with others to cause JKC to lodge false GST returns by relying on inflated or false intra-group invoices. The jury directions, read as a whole, sufficiently conveyed the nature of the conspiracy, its object, the means by which it was to be achieved, and the overt acts committed in furtherance of it.
On the question of duplicity, the Court found the indictment was not duplicitous. The two schemes were treated as components of a single overarching conspiracy rather than separate offences, consistent with the way the Crown put its case throughout the trial.
The ground alleging the verdict was unsafe because it required proof of an intention to cause loss through liquidation was also rejected. The Court found the Crown did not need to establish that the conspirators specifically intended or planned for JKC to be liquidated. It was sufficient that they intended to cause JKC to obtain GST refunds to which it was not entitled, and that the loss to the Commonwealth was caused dishonestly.
On the sentence appeal, Macfarlan JA found no deficiency in the sentencing judge's findings. The sentencing judge had found that the conspiracy involved both schemes, that the appellant had a general awareness of the inflation or falsity of the invoices, and that the conspiracy's object was to obtain GST refunds beyond JKC's entitlement. The Court granted leave to appeal against sentence but dismissed that appeal.
Orders Made
- Leave to appeal against sentence granted
- Appeal against conviction dismissed
- Appeal against sentence dismissed
Key Takeaways
- A conspiracy charge under s 135.4(3) of the Criminal Code (Cth) does not require proof that the conspirators specifically intended a particular mechanism, such as company liquidation, to crystallise the intended loss to the Commonwealth. An intention to dishonestly cause the loss is sufficient.
- Where a single conspiracy encompasses multiple schemes carried out over time, the indictment is not necessarily duplicitous, provided the schemes are properly characterised as components of one overarching agreement.
- In dismissing the conviction appeal, the Court of Criminal Appeal confirmed that jury directions are assessed holistically. Minor imprecision or elision in directions will not produce a miscarriage of justice where the directions, read as a whole, adequately conveyed the essential elements of the offence.
- Cumulative error arguments require the individual grounds to have real substance. Where each ground fails separately, a cumulative ground based on those same matters will not ordinarily succeed.
- Adequate sentencing findings on a conspiracy charge do not require the sentencing court to determine the precise dollar figure known to each conspirator. A general finding that the offender was aware of the inflation or falsity of the invoices, and that the conspiracy extended to both alleged schemes, was held to be sufficient.
Legislation and Cases Referenced
Legislation:
- Criminal Code (Cth), ss 135.1, 135.4(3), 135.4(5), 135.4(9)
- Criminal Appeal Rules 1952
Cases:
- Filippou v The Queen (2015) 256 CLR 47; [2015] HCA 29
- Papakosmas v The Queen (1999) 196 CLR 297; [1999] HCA 37
- Pratten v R [2014] NSWCCA 117
- R v Aziz [1982] 2 NSWLR 322
- R v Walsh (2002) 131 A Crim R 299; [2002] VSCA 98