Chan v The Queen P30/2002 [2003] HCATrans 725 (9 May 2003)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Perth No P30 of 2002

B e t w e e n -

FRANCES MARY CHAN

Applicant

and

THE QUEEN

Respondent

Application for special leave to appeal

McHUGH J

KIRBY J

TRANSCRIPT OF PROCEEDINGS

FROM PERTH BY VIDEO LINK TO CANBERRA

ON FRIDAY, 9 MAY 2003, AT 11.33 AM

Copyright in the High Court of Australia

MR I.L.K. MARSHALL: May it please your Honours, I represent the applicant. (instructed by Michael T.L. Ting)

MR R.E. COCK, QC: If the Court pleases, I appear with my learned friend, MS A.J. BURROWS, for the respondent. (instructed by Director of Public Prosecutions for Western Australia).

McHUGH J: Yes, Mr Marshall.

MR MARSHALL: Special leave is sought in relation to the convictions and the sentences in this matter. Could I start by focusing on count 4 on the indictment which is to be found at page 2 of the application book, the fraud on the R & I Trustees to obtain 560,000. So far as sentence was concerned, the sentence imposed was 5 years imprisonment, cumulative on the sentence imposed in relation to the other matters, resulting in a 9-year term of imprisonment.

The maximum under the statute is 7 years. The term of 5 years we say was manifestly excessive in the circumstances. The circumstances were that the R & I Trustees in the end were only out of pocket $78,000. The reason they were out only 78,000 is that they did not choose to enforce the security they had as it was going to be "a hassle". This sentence of 5 years imprisonment for a fraud of that magnitude compares - in the materials that have been sent to you - and my learned friend can correct me if I am wrong, but the very same judge that sentenced the applicant, Judge Groves, imposed a 21/2-year sentence for fleecing investors of $770,000. There was no recovery there in the same way as that decision of Grubb which has come through to you, $5.2 million and no recovery, 10 years imprisonment - - -

McHUGH J: But, Mr Marshall, this Court is not a Court of Criminal Appeal.

MR MARSHALL: Yes, I understand that, but the administration of justice in Western Australia - it is important to get some guidelines in relation to sentencing. When Mr Bond was - - -

McHUGH J: That is the last thing you will get out of this Court, guidelines, particularly in relation to matters in Western Australia.

MR MARSHALL: But if this Court does not interfere and give special leave on matters such as this, it reflects on the administration of justice because it does seem to be an incredibly high sentence when compared to others. But, anyway, if I could move off the sentence point in relation to count 4 and deal with the conviction. We say that is flawed. The trial judge was in error because he directed the jury that it was Mr Kamp's mind that was the operative mind so far as processing the application.

The reality was that Mr Kamp was an employee of the R & I Trustees. All he ever did was collate the application, put it before the Board. He acknowledge the decision was the Board of Trustees. He acknowledged that it is up to them what decision they make. Our point is that there was no evidence from Board members who approved the loan. They are the ones that should have been called and they are the ones that should have been asked, "Why did you part with the money? Had you known of the false representation, would you have parted with the money?", the time-honoured questions asked in fraud cases.

In this case, when the trial judge directed, as he did, that Mr Kamp was the operative mind when in fact he did not make a decision at all and the Full Court at page 148 concluded that Mr Kamp:

was . . . the directing mind and will of the company.

We say that was an erroneous finding of the Full Court, and, indeed, an erroneous direction by the learned trial judge. The Board members were called in the Seng Fai Chan trial. He was co-accused with the very same offence but there were separate trials. Your Honours will have seen some material about that. At that trial, Mr Renton, Board member, and Mr Taylor, Board member, were called and they answered the questions, essentially, that they would not have parted with the money but for the representation.

So, what we say is - and it was raised with the learned trial judge at the time - there was a big gap in the prosecution case and it is necessary on the basis of the authority to set out in the summary of argument to go through that process of calling the decision-maker and calling the Board members who approved the loan because it was, indeed, the directors of the R & I Trustees Ltd that approved the loan.

Your Honours, I am not going to repeat what I have said in the summary of argument. That is all there. Your Honours have read it. But, in addition to that ground, there is also a number of stand alone grounds and ground 1, about the failure to give the direction as to good character. In this case we called evidence of good character and in this case, it being allegations of dishonesty, it is quite normal to call evidence of good character. The jury were entitled to a direction as to how that evidence should be used. In this particular case, at trial the learned trial judge was asked to direct according to law and to tell the jury that they could consider the evidence of good character in assessing the credibility of explanations offered by an accused and the credibility of the accused as a witness.

The way in which the Court of Criminal Appeal in Western Australia dealt with the matter at paragraph 98 of their judgement, page 132 of the application book, was to say:

Although, a request for a direction on this point having been made by counsel for the appellant, it would have been preferable for the trial Judge to have acceded to the request, I do not consider that his Honour's declining to do so have given rise to any miscarriage of justice.

So, effectively, a proviso there acknowledging that there is a point - "it would have been preferable" are the words used. We say that when you are administering justice according to law, the law as to what directions should be given as to good character is there and that should be adhered to.

The next ground, ground 2, the absence of Mrs Corena giving evidence. Her husband gave evidence. She was vital in relation to count 4. She was a vital witness, as you have seen for the reasons that I have set out in the summary of the argument as to why it was that she was vital.

There was, indeed, allegations that there were forged signatures. When we had Mr Corena's evidence - his English was extremely poor and he was able to say - well, he said he did not know what he signed and he never read what he signed. He never read any document whatsoever. He signed documents before a Justice of the Peace at the bowling club. He signed an enormous number of documents, statutory declarations, notice to mortgagors, declaration of trust, mortgage requisition, acknowledgement of debt, et cetera, et cetera, that his wife who is well-known to Mrs Chan because Mrs Corena was in Dr Chan's surgery - Dr Chan being the former husband of the applicant.

She was not called. That led to the obvious inference that the evidence that she was going to give was not to the advantage of the Crown and that is something which was raised with the learned trial judge. He said she was not a material witness which is, in my respectful submission, to the learned trial judge, quite wrong. When it came to the Court of Criminal Appeal, your Honours, at page 179 of the application book in relation to this ground - well, there is only one judgment given, essentially, the other judges agreed on this point:

"In any event, I do not consider that the failure of Mrs Corena to give evidence could have led to any miscarriage of justice"

So, again, there is something in it but it does not lead to a miscarriage of justice. The other aspect on the matter about Mrs Corena, your Honours, is that the trial judge said that both the Crown and the defence had the opportunity to call her to give evidence and the jury were told this. That, of course, arose from the principle that it is the responsibility of the Crown to prove the case and it should not rebound on an applicant by not calling a particular witness. She was clearly a vital and material witness.

So, your Honours, if I could move to ground 3, that is the one about the burden of proof. You will have seen what was said. There is a new concept, unknown to the law, introduced by the trial judge when he - at page 179 of the papers, you will have seen what the learned trial judge said. It raised this question of - when the learned trial judge said in two parts. Firstly, in his charge to the jury and, secondly, when he was recalled to correct it, he raised this question of:

"If you are left with a reasonable doubt that there is a reasonable possibility that she is telling the truth then you must acquit. In other words, if you can't determine where the truth lies, then the accused is `entitled to the benefit of the doubt'"

His Honour, Justice Kennedy, when dealing with the matter on behalf of the Court of Criminal Appeal said at page 179:

"It was, I consider, undesirable for the Trial Judge to refer to a `reasonable possibility' that the Appellant was telling the truth, and so to depart from the time honoured formula.

So what we say about that, the direction was wrong. It lacked clarity and precision. What we say is that it is appropriate for this Court on such a fundamental matter - I mean, if 12 jurors go away thinking that they are to look at the matter on the basis if there is a reasonable possibility that she is telling the truth, it puts an onus - it reverses the onus. It is inappropriate, wrong, and it is a simple matter to give a correct direction on the burden of proof. It is fundamental and elementary and to interfere with it and to say, "Well, I consider it undesirable" - I mean, so far as the first ground, it would have been preferable. Now, this is undesirable. We say that the direction to the jury was flawed and the verdicts thereby obtained were also flawed.

So, your Honours, I have dealt with ground 5 which is the one about the R & I Trustees. The other grounds which I have raised - and your Honours will see first of all that there is a ground in relation to accomplices, ground 7. There was no accomplice direction given. We saw this as a case where there was evidence on which a reasonable jury could find that the witnesses, Mrs Tailor and Mr Corena, were participants, namely accomplices of....., and it was an appropriate case to direct the jury to give an accomplice direction because on the applicant's case Mr Corena and Mrs Tailor joined in the rescue plan for this business. She completed the loan applications.

The role of Corenas and Tailor were to sign declarations of trust that they were holding their properties on trust for the applicant. That enabled the loan to be made and the Corenas' son-in-law, Mr Gaglio, and their daughter, Mrs Gaglio, their business was rescued. So we saw it as a case of the Corenas saying, "Well, we did not sell or gift our property" but, obviously, it was allowed to be used to get the money from the R & I Bank and they signed all the documents to enable that loan to be made, statutory declarations and mortgages, the whole lot. So, we say that this is a case where a direction on accomplices ought to have been given.

Finally, ground 8, Mr Seng Fai Chan was duly acquitted of this charge and I realise that there is some law that may well be against me that where two conspirators are charged with the same charge and one is acquitted and one is convicted then the verdict concerning the one that has been convicted does not necessarily have to be set aside on that basis. So, your Honours, if I could just say to you then that there are serious questions arising in relation to the convictions of the applicant, in particular, count 4.

The conviction on count 4, is particularly the strongest error and we would say that the other grounds impact on ground 4, anyway, the burden of proof ground, failure to direct on good character and the failure to direct on the unexplained failure of the Crown to call Mrs Glenis Corena and, of course, the accomplice direction. But if your Honours for some reason find that there is no merit in any of that - and I know that your Honours have a very large application book. Your Honours have been provided with supplementary material and the authorities. But I say if your Honours are against me on the question of the convictions on one or all of the counts in the indictment then, of course, what does cry out for interference by this Court - when you see a sentence of this nature it would be wrong, in my respectful submission - and bearing in mind the other sentences and bearing in mind the fact that there has been almost a total recovery. The shortfall, as I say, was only due to the bank deciding not to enforce the Corena security.

McHUGH J: Yes, I know, but the total loss was somewhere between 250,000 and 302,000, was it not?

MR MARSHALL: Yes. Your Honour, we accepted that it was 250. I think the Crown put forward that it was 302. You are dealing with a $250,000 case. I am not seeking to say that you are only dealing with a $78,000 case. You have 9 years imprisonment - 9 years for $250,000. That is in a nutshell. How does that compare with 1.2 billion with Bell Resources or 5.2 million with Grubb, no recovery. That last matter - and I have sent that material. I think my learned friend, Mr Cock, would be able to confirm the correctness of it, the source that I have. I have not had access, obviously, to the private transcripts of that court proceeding but my learned friend certainly would be able to confirm that, 770,000, 21/2 years.

Your Honours, they are the matters which we say justify this Court interfering and making a grant both in relation to the appeal against convictions and sentence. Thank you.

McHUGH J: Thank you, Mr Marshall. Mr Cock, what do you say about a point which is not made explicit in the applicant's summary of argument about the disparity of sentences in respect of count 4, the fraud count? What do you say about that?

MR COCK: Obviously, your Honour, many of the sentences imposed upon this applicant were made concurrent.

McHUGH J: Yes, I know.

MR COCK: So, if your Honours were to scrutinise that particular sentence, which was 5 years, involving an alleged fraud involving $580,000, even if your Honours were to suggest that a sentence of 5 years imprisonment was too high so as to demonstrate error, the Court would, under our law, be required to re-sentence the applicant in respect of all matters and, in our respectful submission, the appropriate outcome would have been to make some of the other sentences cumulative rather than concurrent, resulting in, effectively, the same total term of imprisonment. In our respectful submission, that would not produce any different outcome to what has been derived in this case.

McHUGH J: We do not want to hear you further, Mr Cock.

MR COCK: Thank you, your Honour.

McHUGH J: Yes, Mr Marshall. Have you anything to say on that last point?

MR MARSHALL: No, your Honour, I have not, thank you.

McHUGH J: Yes, thank you.

This application involved challenges to the conviction and sentences recorded in respect of the applicant. The application did not comply with Order 69A rule 3(1) but, in our opinion, compliance with that rule should be dispensed with. In respect of the challenge to the convictions, the applicant seeks to re-canvass in this Court, which is not simply another general court of criminal appeal, several points that were argued in the Court of Criminal Appeal of Western Australia.

We agree with the approach expressed by Justice Kennedy in that court. On some of the points it might have been preferable if the trial judge had given directions to the jury as submitted by the applicant. However, like Justice Kennedy, we are not convinced that there has been a miscarriage of justice and none of the other points attract a grant of special leave.

So far as the application in respect of the sentences are concerned, it is true that the total length of the sentences is a high one and so is the sentence on count 4, which was a sentence of five years. However, it was open to the sentencing judge to take a view that the applicant had used her position to prey over a lengthy period on people, most of whom were elderly and vulnerable and who trusted her. The convictions involved a net loss of $250,000 on the applicant's concession and $302,000 on the Crown's contention. Moreover, the applicant demonstrated no remorse for her conduct.

This Court's function in reviewing sentences is necessarily limited: see Postliglione v The Queen [1997] HCA 26; (1997) 189 CLR 295 at 337. There is no special leave point involved in respect of the sentences. Accordingly, special leave is refused.

AT 11.57 AM THE MATTER WAS CONCLUDED