Citation: R v Schultz [2022] NSWDC 63
Court: District Court of New South Wales
Date: 2 March 2022
Judge: Grant DCJ
Background
The offender pleaded guilty to four counts of dishonestly obtaining a financial advantage by deception under s 192D of the Crimes Act 1900 (NSW). He had secured employment with four separate entities by submitting false resumes that fabricated qualifications and experience in fields including IT and electrical engineering. He was sentenced to an aggregate term of three years with a non-parole period of two years.
Following conviction, the Crown applied for compensation orders under s 97 of the Victims Rights and Support Act 2013 (NSW) on behalf of four entities: Charles Sturt University ($43,992), Telstra Business Centre Tamworth ($6,254), LRE Services ($91,599, reduced by $10,000 already paid), and the Coleambally Irrigation Company ($48,584). The Crown sought to recover the gross wages paid to the offender during each period of fraudulently obtained employment.
The Crown conceded that, in each case, the work performed by the offender met the standard required under the relevant employment arrangement.
Legal Issues
- Whether the word "person" in the Victims Rights and Support Act 2013 extends to corporations and other non-individual entities, entitling them to seek compensation orders.
- Whether the four applicant entities qualified as corporations under s 57A of the Corporations Act 2001 (Cth).
- Whether each entity had sustained a "loss" through or by reason of the offences, as required by s 97(1) of the Act.
Decision
Does "person" include corporations?
Grant DCJ rejected the defence submission that "person" in the Act was confined to natural individuals. Section 21 of the Interpretation Act 1987 (NSW) defines "person" to include individuals, corporations, and bodies corporate or politic. Under conventional statutory interpretation principles, that extended definition applies to the Victims Rights and Support Act 2013 unless the Act clearly excludes it. The court found no such exclusion, and held that the compensation regime is available to corporate entities.
Were the applicant entities corporations?
Despite accepting that "person" can include corporations, Grant DCJ was not satisfied on the evidence that any of the four entities actually qualified as corporations. Charles Sturt University appeared as a non-registered entity on ASIC searches. Telstra Business Centre Tamworth was a cancelled business name with no evidence from the holder seeking compensation. LRE Services was registered as a business name only, with no corporate evidence adduced. Coleambally Irrigation Cooperative Limited presented ambiguity, but the court noted that no applications had been made on behalf of actual natural persons either. On the evidence before the court, none of the entities was established to be a corporation.
Had the entities sustained loss?
Even proceeding on the assumption that the corporate entity finding was wrong, Grant DCJ held that no compensable loss had been established. A causal connection between the offence and the alleged loss is required, following Fagan v Crime Compensation Tribunal (1982) 150 CLR 666. The offender's fraud induced the entities to employ him, but each entity received genuine economic value from work performed to the required standard. The court reasoned that the entities could not have rescinded the employment contracts for fraud and recovered wages already paid for work actually rendered. Accordingly, no loss was sustained "through or by reason of" the offending.
Orders Made
The court refused all compensation orders sought by the Crown.
Key Takeaways
- Under s 21 of the Interpretation Act 1987 (NSW), the word "person" in the Victims Rights and Support Act 2013 extends to corporations and bodies corporate, making compensation orders available to non-individual entities in appropriate cases.
- Applicants seeking compensation as corporations must establish their corporate status with evidence; ASIC searches showing a non-registered entity or a business name registration alone are insufficient.
- Where an offender obtained employment by deception but performed the required work to an acceptable standard, the employer does not automatically sustain a "loss" equal to the wages paid. The receipt of genuine labour in exchange for wages can defeat the causal connection required by s 97(1).
- A causal connection between the relevant offence and the alleged loss remains a necessary element for any compensation order under the Act, consistent with Fagan v Crime Compensation Tribunal (1982) 150 CLR 666.
- The District Court drew on R v White (No 2) [2021] NSWDC 580 and R v Wills: Application by Woolworths Limited [2013] NSWDC 1 in reaching its conclusions, indicating a developing body of District Court authority on corporate compensation claims in the criminal jurisdiction.
Legislation and Cases Referenced
Legislation
- Victims Rights and Support Act 2013 (NSW), ss 96, 97
- Crimes Act 1900 (NSW), s 192D
- Interpretation Act 1987 (NSW), s 21
- Corporations Act 2001 (Cth), s 57A
- Crimes (Sentencing Procedure) Act 1999 (NSW), Pt 3 Div 3
Cases
- Fagan v Crime Compensation Tribunal (1982) 150 CLR 666
- R v White (No 2) [2021] NSWDC 580
- R v Wills: Application by Woolworths Limited [2013] NSWDC 1