Citation: Michael Robert Holloway v R [2017] NSWCCA 17
Court: NSW Court of Criminal Appeal
Date: 24 February 2017
Judges: Hoeben CJ at CL; Johnson J; Latham J
Background
The appellant was the chief executive officer of the Australian branch of a freight forwarding company. Between January 2004 and January 2011, he caused false invoices to be created in the name of a non-existent entity and directed subordinates to issue cheques payable to cash against those invoices. The total amount fraudulently withdrawn from the company's accounts was approximately $2 million, some of which flowed into the appellant's personal accounts and funded personal expenses.
The appellant's defence at trial was that his superior, the company's major shareholder and director based in the UK, was a co-architect of the scheme and received a substantial share of the proceeds. The director acknowledged receiving two cash payments totalling approximately $44,000 but denied broader complicity in the false invoicing scheme. The appellant did not give evidence at trial, though admissions he had made in earlier civil proceedings were tendered against him.
The appellant was tried on 79 fraud charges. Counts 1 to 69 were brought under the former section 176A of the Crimes Act 1900 (NSW), and counts 70 to 79 were brought under the current section 192E. The jury acquitted him on the first 69 counts but convicted him on the remaining ten. He was sentenced to an aggregate non-parole period of two years and six months, with a balance of term of 18 months. He appealed both the convictions and the sentence.
Legal Issues
- Whether the convictions on counts 70 to 79 were legally inconsistent with the acquittals on counts 1 to 69, given that the underlying conduct was identical throughout the entire period charged.
- Whether the sentence of four years in aggregate (non-parole period of two years and six months) was manifestly excessive for ten fraud offences, each carrying a maximum penalty of ten years imprisonment.
Decision
Inconsistency of verdicts: The Court examined whether the two sets of charges, though based on identical conduct, carried materially different elements that could explain the split verdicts. The critical distinction was that section 192E, unlike section 176A, expressly required the jury to find that the appellant acted dishonestly according to the standards of ordinary people and that he knew his conduct was dishonest by those standards. The trial judge had directed the jury specifically on this additional element for counts 70 to 79. No equivalent direction applied to counts 1 to 69.
The Court accepted the respondent's submission that the acquittals on counts 1 to 69 were explicable on the basis that the jury was not satisfied the appellant had defrauded the company within the meaning of section 176A, perhaps because it accepted the defence suggestion that the scheme benefited the company by reducing its Australian tax liability. The convictions on counts 70 to 79 could rationally rest on the jury being satisfied that the appellant had obtained a financial advantage by deception and had done so dishonestly in the personal sense. The verdicts were not logically irreconcilable and the appeal against conviction was dismissed.
Manifest excess: The Court applied the established standard from Dinsdale v The Queen and Wong v The Queen, requiring the appellant to demonstrate that the sentence was unreasonable or plainly unjust such that an inference of miscarriage of the sentencing discretion arose. The sentencing judge had taken into account a range of mitigating factors, including the appellant's health issues, depression, delay in commencing proceedings, onerous bail conditions, and special circumstances. None of those findings were challenged on appeal.
The comparable cases relied on by the appellant did not support a finding of manifest excess. Four of the six cases cited were Crown appeals from inadequate sentences, and two of those involved lower maximum penalties. The remaining cases concerned sentences that the Court of Criminal Appeal had itself described as lenient. The Court held that an aggregate sentence of four years for ten offences each carrying a ten-year maximum was well within the available sentencing discretion. Leave to appeal against sentence was granted but the appeal was dismissed.
Orders Made
- Conviction appeal dismissed.
- Leave to appeal against sentence granted.
- Sentence appeal dismissed.
Key Takeaways
- Different legislative elements across two sets of charges on an indictment can, in appropriate circumstances, provide a rational basis for split verdicts, even where the underlying factual conduct is identical throughout the charged period.
- The Court of Criminal Appeal confirmed that the test for manifest excess requires more than a comparison with sentences in other cases at a high level of abstraction. The appellant must establish that the sentence is unreasonable or plainly unjust, not merely that other sentences were lower.
- Where comparable cases relied on by an appellant are drawn from Crown appeals against inadequacy or are described in prior decisions as lenient, they carry little weight in establishing that a sentence is excessive.
- Under section 192E of the Crimes Act 1900 (NSW), a jury must be satisfied both that the accused acted dishonestly by the standards of ordinary people and that the accused knew their conduct was dishonest by those standards. This dual requirement is distinct from the elements required under the former section 176A.
- Upholding the sentence, the Court treated the amount of money defrauded as one factor among many, not a determinative benchmark, in assessing the appropriateness of a fraud sentence.
Legislation and Cases Referenced
Legislation
- Crimes Act 1900 (NSW), s 176A (former provision)
- Crimes Act 1900 (NSW), s 192E
Cases
- Mackenzie v The Queen [1996] HCA 35; 190 CLR 348
- TK v R [2009] NSWCCA 151
- Dinsdale v The Queen (2000) 202 CLR 321
- Wong v The Queen (2001) 207 CLR 584; [2001] HCA 64
- Stratford v R [2007] NSWCCA 279