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9
Court of Criminal Appeal 7 March 2016

Coles v R

[2016] NSWCCA 32

Fraud & dishonesty
CRIMINAL LAW APPEAL AGAINST SENTENCE

Citation: Coles v R [2016] NSWCCA 32
Court: NSW Court of Criminal Appeal
Date: 7 March 2016
Judge(s): Hoeben CJ at CL, Adams J, Fullerton J (all agreeing)

Background

The appellant was a financial adviser who encouraged clients to allow him to hold or store valuable Australian artworks, primarily on behalf of self-managed superannuation funds. Over a period spanning 2001 to 2008, he systematically defrauded those clients by dealing with the artworks contrary to the terms of the bailment, failing to account for proceeds of sale, and retaining funds for his own benefit. The total value of the 35 artworks identified in the agreed facts was approximately $5.96 million, and none were recovered.

Police executed search warrants at the appellant's home and business in January 2009. However, charges were not laid until January 2012, following a three-year investigation. The appellant was ultimately committed for trial on 30 offences, with a further 74 offences noted on a section 166 certificate.

In August 2013, shortly before the trial date, the appellant pleaded guilty to 15 counts under various provisions of the Crimes Act 1900 (NSW) and asked the sentencing judge to take into account a further 18 offences on two Forms 1. The District Court imposed an aggregate sentence of 8 years and 6 months with a non-parole period of 4 years and 9 months. The appellant sought leave to appeal on the sole ground that the sentencing judge failed to treat the three-year delay between investigation and charging as a mitigating factor.

  • Whether the sentencing judge erred in failing to treat the three-year gap between the commencement of the police investigation (January 2009) and the laying of charges (January 2012) as a mitigating factor in the sentencing exercise.
  • Whether that failure to address the delay submission in the sentencing remarks constituted an error of principle warranting resentencing.

Decision

Fullerton J (with whom Hoeben CJ at CL and Adams J agreed) reviewed the principles governing delay as a potential mitigating factor, drawing on Blanco v R and Sabra v R. Those cases recognise that delay not attributable to the offender may carry mitigating weight, particularly where an offender has been left in genuine uncertainty and suspense, has demonstrated rehabilitation during the intervening period, or is being sentenced for offending that has become stale. The Court in Sabra had also confirmed that NSW does not require an offender to show consequences beyond anxiety and uncertain suspense before delay can be taken into account.

However, Fullerton J found that the specific circumstances of this case provided no principled basis for the delay to attract leniency. The three-year investigation was a complex and substantial undertaking, entirely proportionate to the scope of the fraud. The appellant's evidence that he "had no idea what police really wanted of him" was characterised as disingenuous, given that he must have appreciated the inevitability of prosecution for a systematic and patent course of fraudulent dealing spanning many years.

Critically, the appellant led no evidence of any detriment flowing from the delay. His changed material circumstances (driving taxis and living in rented accommodation at the time of arrest) were unrelated to the delay and reflected the consequences of his bankruptcy. His non-reoffending during the three years was attributed to the loss of his clientele and business capacity rather than any genuine rehabilitation. In those circumstances, the sentencing judge's silence on the delay submission did not constitute legal error, because there was no evidential foundation for it to carry any mitigating weight.

The Court noted that it would have been preferable for the sentencing judge to expressly address and distinguish Blanco, but the failure to do so did not amount to error where there was simply no basis for the principle to apply.

Orders Made

  • Leave to appeal granted.
  • Appeal dismissed.

Key Takeaways

  • Delay between investigation and charge may be a mitigating factor at sentence, but only where there is an evidentiary foundation: the offender must show something more than the mere passage of time, such as genuine prejudice, detriment, or demonstrated rehabilitation during the delay period.
  • A complex, multi-year police investigation proportionate to the scale and complexity of the alleged offending will not, without more, ground a mitigation claim based on delay.
  • Where an offender's non-reoffending during a period of delay is attributable to changed external circumstances (such as bankruptcy and loss of clientele) rather than genuine rehabilitation, that period of compliance carries no mitigating weight.
  • A sentencing judge's failure to explicitly address a delay submission in sentencing remarks does not constitute error of principle where no principled basis for the submission existed on the evidence.
  • In dismissing the appeal, the Court of Criminal Appeal confirmed that Sabra v R and Blanco v R state the applicable NSW principles on delay and mitigation, while emphasising that those principles require a factual foundation before they can operate in an offender's favour.

Legislation and Cases Referenced

Legislation
- Crimes Act 1900 (NSW), ss 117, 125, 178A, 178BA
- Crimes (Sentencing Procedure) Act 1999 (NSW), s 44(2)

Cases
- Blanco v R [1999] NSWCCA 121; 106 A Crim R 303
- Sabra v R [2015] NSWCCA 38
- Pickard v R [2011] SASCFC 134
- McKittrick v R [2014] NSWCCA 128
- Mill v R [1988] HCA 70; 166 CLR 59
- Todd v R [1982] 2 NSWLR 517