New South Wales Court of Criminal Appeal CITATION : Regina v Paul John Finn [2002] NSWCCA 86 FILE NUMBER(S) : CCA 60358/2001 HEARING DATE(S) : 19 March 2002 JUDGMENT DATE : 19 March 2002 PARTIES : Regina Paul John Finn JUDGMENT OF : Greg James J at 14; Buddin J at 1 LOWER COURT JURISDICTION : District Court LOWER COURT FILE NUMBER(S) : 99/11/1059 LOWER COURT JUDICIAL Stewart DCJ OFFICER : COUNSEL : LMB Lamprati (Crown) R Jankowski (Applicant) SOLICITORS : SE O'Connor (Crown) Armstrongs (Applicant) CATCHWORDS : Make false instrument with intent to induce another to accept it as genuine - discount for plea of guilty - "first reasonable opportunity" for plea - parity of sentencing - "special circumstances" - need for general deterrence in significant fraud cases R v Cameron [2002] HCA 6 CASES CITED: R v Morgan (1993) 70 A Crim R 368 R Thomson & Houlton (2000) 49 NSWLR 683 DECISION : Leave to appeal granted. Appeal allowed. Sentences imposed in the District Court quashed. In lieu thereof and taking into account matters on Form 1, in respect of count 1 the applicant is sentenced to 2 years imprisonment to date from 11 May 2001 and to expire on 10 May 2003. Non-parole period of 16 months is fixed which will expire on 10 September 2002. In respect of each of counts 2-6 the applicant is sentenced to fixed terms of 16 months imprisonment to commence on 1 May 2001 and to expire on 10 September 2002. IN THE COURT OF CRIMINAL APPEAL 60358/2001 GREG JAMES J BUDDIN J TUESDAY 19 MARCH 2002 REGINA V PAUL JOHN FINN Judgment 1 BUDDIN J: The applicant seeks leave to appeal against sentences imposed upon him in the District Court. On 19 March 2001 the applicant pleaded guilty to an indictment containing six counts. The first count charged the applicant with having: Between 24 April 1993 and 28 April 1993 at Sydney in the State of New South Wales made a false instrument, namely an NRMA Insurance claim form in the name of Robert Fisher with the intent that [the applicant] or another person, use the said false instrument to induce NRMA Insurance Limited to accept it as genuine and thereby cause NRMA Insurance Limited to pay $17,253.60 to the prejudice of NRMA Insurance Limited. 2 The remaining counts were in very similar terms. The applicant also asked that a further seventeen charges of a similar nature which were set out on a Form 1 be taken into account. The maximum penalty for each of the charges on the indictment is ten years imprisonment. In relation to count 1 of the indictment the applicant was sentenced to three years' imprisonment with a non-parole period of two years to commence on the date on which he first went into custody which was 11 May 2001. That was also the date on which the sentence was imposed. On each of the remaining five counts the applicant was sentenced to concurrent fixed terms of two years' imprisonment. 3 The sentencing judge summarised the essential background facts to the offences. The relevant parts from his Honour's remarks on sentence are set out below: There is no doubt that the man, Dominic Saratore is the principal offender. He was employed by the NRMA as a claims manager at the Eastwood and Burwood branches of that organisation. It is clear that the frauds and conspiracies which are involved could not have occurred without Saratore's organisation, involvement, assistance and knowledge. He profited from the operation and encouraged others to participate. He was a specialist fraud investigator working for the NRMA. It is not important to specify which particular branch of NRMA, whether it be the NRMA organisation itself, or one of its subsidiaries, or NRMA Insurance Limited. However, he was a trusted employee and was as I say a part of the internal investigative organisation within the NRMA itself. His task was to ensure that security arrangements in relation to claims and the like were in place, and to work in close liaison with police authorities. Far from doing that Saratore used his position to fraudulently take from his employer a large amount of money. The Task Force of the Commercial Crime Agency of the New South Wales Police Service that investigated these matters, conducted inquiries into this system of organised fraud which involved claims against NRMA Insurance Limited to the value of approximately one point one five million dollars. As a result of police inquiries a large number pf people were charged with fraud offences to the value of some $733,877. Saratore, the NRMA investigator involved, fraudulently alleged that motor vehicle accidents had occurred and that repairs had been carried out at ESP Smash Repairs, and apparently arranged false insurance claims which were submitted to the NRMA Insurance Limited. The six counts to which Finn is pleading guilty involve a total of more that $130,000. There is evidence to establish clearly that the fraudulent claims were facilitated in part by staff at ESP Smash Repairs. The prisoner was the manager of that organisation at the time the fraudulent claims were submitted, and it would seem that on most occasions in relation to the offences he is charged with, he would arrange to have customer's (sic) motor vehicles written off or repaired. The customer would sign a blank claim form before leaving and the prisoner, or another person, would later complete this insurance claims form, alleging that it had been involved in a fictitious motor vehicle accident. The accident would involve a fictitious offending vehicle, the fictitious vehicle would have a third party insurance so the other driver, or drivers, would not lose their no claim bonus. The customer's vehicle would be damaged to resemble the accident damage claimed, or it would already have previous consistent damage. The claim would then be submitted, the vehicle would be assessed as a total write off by the insurance company or would be repaired by ESP Smash Repairs. The vehicle would be repaired with no costs to the customer, or in cases when it was written off, the customer would receive a cheque for the insured amount in the mail. The accused, in those circumstances, was undoubtedly involved, although as I say Saratore was the principal. Saratore's employment was terminated when he was caught by NRMA staff to be completing a claim form in another person's name. He left Australia shortly after his involvement was discovered and at the time these facts were prepared it was believed that he was residing in Italy. This prisoner informed the police that he was not aware of Saratore's involvement in the matter. He, Saratore, facilitated at least forty of the claims related to the fifty two collisions investigated by police. This prisoner facilitated at least twenty-three such claims. He is charged of course with six counts and has asked me to take into account seventeen others. That amounts of course, to twenty three involvements. It appears that most of the benefits went into the ESP Smash Repair operating account, and that organisation benefited by processing and repairing the vehicles. The business would either receive a cheque directly from the insurer or from Smash Repairers Factoring Company which covers the debt, and are later paid by the insurer. There is clear evidence to suggest that this prisoner benefited directly in relation to offence number seven in the Form One document to which I have referred. That was in relation to his own motor vehicle, which had been involved in a fictitious motor vehicle collision. He had his own car repaired by ESP Smash Repairs, so the facts relate, and the NRMA paid $12,888.13 to Smash Repairs Factoring Company as payment for the repairs allegedly carried out by ESP Smash Repairs to the accused's car. It is not necessary to recite in detail the facts in relation to each of the charges on the indictment, except to say that it clear that many of the names involved are fictitious, and the whole enterprise is riddled through with fraud and fictitious allegations and statements, both as to people, vehicles and collisions. Saratore undoubtedly has a great deal to answer for. 4 The sentencing judge also gave consideration to the various subjective features of the matter upon which the applicant was entitled to rely. Prominent among those considerations was the fact that the applicant had pleaded guilty. His Honour specifically took that factor into account. Having had regard to the utilitarian value of the plea and the fact that it indicated at least some contrition and remorse, his Honour purported to apply the principles established in R v Thomson & Houlton (2000) 49 NSWLR 683 as a result of which his Honour allowed a discount of 15% for the plea of guilty. 5 His Honour went on to say that "although the plea was not at the earliest opportunity, it was at a time when an indictment had been prepared, apparently for the first time in the form that it was, and accordingly he must be given credit for that". 6 In R v Cameron [2002] HCA 6 the majority of the High Court held that in assessing the extent to which a plea of guilty may be taken into account in mitigation "leaving aside remorse and acceptance of responsibility, the operative consideration is willingness to facilitate the course of justice…[and] a significant consideration on that issue is whether the plea was entered at the first reasonable opportunity." [at para. 22] 7 If that were the only basis upon which error had been established then I would not have been inclined to the view that it would of itself necessarily warrant intervention by this Court. However, bearing in mind what the High Court said in relation to what constitutes "the first reasonable opportunity", the sentencing judge has in my view fallen into error in not treating the circumstances in which the plea was entered as being at "the first reasonable opportunity". Moreover, in my view, the evidence before his Honour demonstrated that the applicant was entitled to a significant measure of leniency on account of his "willingness to facilitate the course of justice". 8 The applicant also submits that he entertains a justifiable sense of grievance by reason of the sentences imposed upon him when compared with those imposed upon other persons involved in this operation. See Lowe v the Queen (1984) 154 CLR 606. A schedule which was in evidence before his Honour disclosed that 22 other people had been dealt with in respect of offences arising from this operation. It is apparent from that schedule that not one of those other offenders received a sentence of full-time imprisonment. They were dealt with by way of recognisance, fines or community service orders. Some of them were dealt with in the Local Court, but a number of them were sentenced in the District Court. Although the number and size of the claims with which those offenders were concerned were considerably smaller than was the situation in the applicant's case, there were in some instances claims of considerable magnitude. 9 To highlight the sense of grievance which the applicant entertains he points to the fact that he has been treated significantly differently from other persons named Paul and Nicholas Papponetti. The evidence disclosed that the Papponettis were, along with others, co-owners of ESP Smash Repairs. The agreed statement of facts which was in evidence revealed that the police were of the view that the applicant performed a similar role to that played by the Papponettis in that each was "motivated to keep ESP Smash Repairs from closing." Paul Papponetti received a two year recognisance together with an order for compensation whilst Nicholas Papponetti received a two year recognisance together with an order for compensation. His Honour did not indicate why he had decided to impose a sentence upon the applicant which was in such sharp contrast to the way in which other offenders were dealt with. 10 Notwithstanding the fact that the applicant displayed greater criminality by reason of his involvement in a larger number of transactions with correspondingly larger sums of money involved, it is my view that the applicant's submission should be upheld so as to avoid what the High Court has referred to as "the badge of unfairness". 11 It then falls to the court to embark upon the exercise of resentencing the applicant. There is no doubt that the extent of the applicant's involvement in this scheme and his important role in facilitating it warranted a custodial sentence which would give effect to the need for general deterrence. See Pantano (1990) 49 A Crim R 328. As his Honour said "it is clear that this prisoner was only too ready to take a role in this series of most serious frauds upon the NRMA." Moreover his involvement continued for nearly three years and he had involved others in the enterprise. Nevertheless the sentencing judge found that the applicant's direct benefit was limited to the claim which he made upon NRMA for $12,883.13 in respect of his own motor vehicle's involvement in a collision which had never occurred. 12 There are a number of matters which his Honour took into account in the applicant's favour which remain relevant for present purposes. They include his plea of guilty, his prior good record, his age (he is now in his mid- 50s) his favourable prospects for rehabilitation and his overall health which includes a depressive illness and an underlying post-traumatic stress disorder. 13 His Honour made a finding of "special circumstances." I too would come to the same conclusion in respect of that matter for the reasons advanced by his Honour. In that context His Honour specifically found that it was unlikely that the applicant would re-offend. Having considered all the factors relevant to the sentencing exercise including the need to accommodate the principles of totality and of parity as well as the considerations referred to by this Court in R v Morgan (1993) 70 A Crim R 368 in respect of the matters on the Form 1, I propose the following orders: 1 Leave to appeal granted. 2 Appeal allowed. 3 Sentences imposed in the District Court quashed. 4 In lieu thereof and taking into account the matters on the Form 1 in respect of count 1 the applicant is sentenced to two years' imprisonment to date from 11 May 2001 and to expire on 10 May 2003. A non-parole period of 16 months is fixed which will expire on 10 September 2002 on which date the applicant will be released on parole. In respect of each of counts 2 – 6 the applicant is sentenced to fixed terms of 16 months imprisonment to commence on 1 May 2001 and to expire on 10 September 2002. 14 GREG JAMES J: I agree. The orders therefore will be as stated by Buddin J. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.