Citation: R v El Khatib [2019] NSWDC 158
Court: District Court of New South Wales
Date: 19 March 2019
Judge: P Taylor SC DCJ
Background
The offender was the Site Manager, and later Regional Manager, of a logistics company's operations at a major grocery distribution centre. From early 2013, he entered into corrupt arrangements with two subcontractors who relied on the company for the allocation of transport work. In return for showing favour to those subcontractors, the offender received regular cash payments, bank transfers, paid family holidays, and the use of a new car.
The primary corrupt relationship was with the owner of one subcontracting company, who made weekly cash payments and bank transfers to the offender over approximately two years. A second subcontractor made weekly payments of $1,500 for more than seven months. The total value of benefits received exceeded $345,000, plus more than 20 months of exclusive use of a vehicle purchased for $57,000.
A jury convicted the offender on all six principal counts of corruptly receiving benefits as an employee, contrary to s 249B(1) of the Crimes Act 1900. The sentencing proceedings required the court to determine disputed facts and fix an appropriate sentence.
Legal Issues
- What facts adverse to the offender could be found to the criminal standard for sentencing purposes, including the precise amount of cash received and who initiated the corrupt arrangement
- How the offender's role in instigating the scheme, his lack of remorse, and his conduct at trial should be weighed as aggravating factors
- How the principle of parity applied, given that co-offenders had been sentenced
- Whether any personal circumstances, including the offender's background and the effect of imprisonment on his family, warranted a reduction in sentence
- How multiple counts should be structured as an aggregate sentence with an appropriate non-parole period
Decision
On the facts in dispute, the District Court found that the offender received at least $171,850 in cash and cash deposits (Count 1), applying the criminal standard of proof beyond reasonable doubt. Although other evidence suggested the total may have been considerably higher, the court confined its findings to the amount pressed by the Crown and not disputed by the offender at sentence. The court also found, on the balance of evidence, that the offender was the likely initiator of the corrupt arrangement, pointing to his demands for payment in text messages, his use of food-related code words for cash, his parallel arrangement with a second subcontractor, and the rejection of his evidence by the jury.
The court identified several significant aggravating features. These included the scale and duration of the offending, the substantial financial gain, the breach of trust by a middle manager entrusted with real commercial power over subcontractors, the detriment suffered by other subcontractors who missed out on work, and the offender's lack of remorse or contrition. The offender contested facts at sentence that the jury had clearly rejected, and his evidence during trial demonstrated ongoing dishonesty.
The court considered parity with sentences imposed on the two subcontractor owners who had pleaded guilty and received lesser penalties, noting that their cooperation with authorities and early pleas distinguished their positions from the offender's contested trial. Mitigating factors, including the offender's difficult upbringing, good employment record, and family circumstances, were acknowledged but afforded limited weight in light of the seriousness of the offending and the absence of contrition.
The court determined that a full-time custodial sentence was required and that no alternative was appropriate. The total effective sentence of three years and nine months, with a non-parole period of two years and three months, reflected the accumulation of a fixed term for the WJS Logistics counts and an aggregate sentence for the remaining counts.
Orders Made
- Count 11 (WJS Logistics): fixed term of 18 months' imprisonment, commencing 17 March 2019 and concluding 16 September 2020
- Counts 1, 3, 5, 7 and 9 (M&R Transport): aggregate sentence of 3 years and 6 months, with a non-parole period of 2 years, commencing 17 June 2019 and concluding 16 December 2022
- Indicative sentences: Count 1: 3 years; Counts 3 and 5: 18 months each; Counts 7 and 9: 3 months each
- Total effective sentence: 3 years and 9 months, with a non-parole period of 2 years and 3 months
- Recommended release to parole on 16 June 2021
Key Takeaways
- Under s 249B(1) of the Crimes Act 1900, the maximum penalty for each count of corruptly receiving a benefit as an employee is seven years' imprisonment, with no standard non-parole period prescribed by statute.
- Adverse facts for sentencing purposes must be proved beyond reasonable doubt and must be consistent with the jury's verdicts, following R v Isaacs and R v Olbrich.
- A middle manager with practical power to allocate work among subcontractors occupies a position of sufficient trust that corrupt exploitation of that power constitutes a serious breach warranting full-time imprisonment, even in the absence of a formal senior executive role.
- Lack of remorse and ongoing dishonesty at trial, including the rejection of defence evidence by the jury, were treated as significant factors in assessing the offender's moral culpability and limiting the weight given to personal mitigating circumstances.
- The parity principle did not require equivalent sentences for co-offenders where those co-offenders had cooperated with authorities and entered early guilty pleas, which materially distinguished their positions from that of an offender who contested the charges throughout.
Legislation and Cases Referenced
Legislation
- Crimes Act 1900 (NSW), s 249B
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 5, 21A, 24B, 44, 68
Cases
- Cheung v R (2001) 209 CLR 1
- Filippou v R (2015) 256 CLR 47; [2015] HCA 29
- R v Isaacs (1997) 41 NSWLR 374
- R v Olbrich (1999) 199 CLR 270
- Savvas v R (1995) 183 CLR 1
- Veen v R (No 2) (1988) 164 CLR 465; [1988] HCA 14