R v Nilesh Maharaj [2004] NSWCCA 387

New South Wales Court of Criminal Appeal

CITATION : R v Nilesh Maharaj [2004] NSWCCA 387 HEARING DATE(S) : 09/11/2004 JUDGMENT DATE : 9 November 2004

JUDGMENT OF : McColl JA at 39; Howie J at 40; Buddin J at 1 DECISION : Leave to appeal granted. Appeal dismissed.

CATCHWORDS : Sentencing - make and use false instruments - significant dishonesty involving breach of trust - "fresh evidence" on appeal Attorney-General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 No 1 of 2002 (2002) 127 A Crim R 180 R v Ashton (2002) 137 A Crim R 73 R v Bailey (1988) 35 A Crim R 458 CASES CITED : R v Cartwright (1989) 17 NSWLR 243 R v Ehrenburg (NSWCCA unreported 14 December 1990) R v Fordham (1997) 98 A Crim R 359 R v Lanham [1970] 2 NSWR 217 R v Pantano (1990) 49 A Crim R 328 PARTIES : Regina Nilesh Nischal Maharaj (Applicant) FILE NUMBER(S) : CCA 2004/1782 COUNSEL : B Knox SC (Crown) B Stratton QC (Applicant) SOLICITORS : S Kavanagh (Crown) Ryan & Bosscher (Applicant)

LOWER COURT District Court JURISDICTION : LOWER COURT 03/11/0805; 02/11/1196 FILE NUMBER(S) : LOWER COURT Berman DCJ JUDICIAL OFFICER :

IN THE COURT OF CRIMINAL APPEAL 2004/1782

MCCOLL JA HOWIE J BUDDIN J

TUESDAY 9 NOVEMBER 2004 REGINA v NILESH NISCHAL MAHARAJ Judgment 1 BUDDIN J: The applicant seeks leave to appeal against the severity of sentences imposed upon him in the District Court. The applicant originally pleaded guilty to a number of matters in the Local Court and adhered to those pleas when he appeared for sentence in the District Court. In all the applicant pleaded guilty to 7 offences of making a false instrument and 7 offences of using a false instrument. He also pleaded guilty to one offence of embezzlement and one offence of larceny as a clerk. Each of the offences attracted a maximum penalty of 10 years imprisonment. The applicant asked that a further 122 offences of a similar kind, which were on a Form 1, be taken into account upon sentencing. 2 In respect of one of the counts of making a false instrument (and taking into account the matters on the Form 1 document) the applicant was sentenced to 4 years imprisonment with a non-parole period of 2 years. Both the head sentence and the non-parole period for that offence were ordered to commence on 31 October 2004 with the result that the head sentence will expire on 30 October 2008 and the non-parole period will expire on 30 October 2006. This sentence was ordered to commence 12 months after the commencement of sentences imposed in respect of all but two of the other matters and thus was, to that extent, cumulative upon the sentences imposed in respect of those other offences. In respect of each of those offences, fixed terms of 2 years imprisonment were imposed. All those sentences were ordered to commence on 31 October 2003 and were to be served concurrently with one another. The remaining two offences attracted concurrent fixed terms of 2 years and six months imprisonment which were subsumed within the sentence to which I earlier referred. The overall effective sentence is thus one of 5 years imprisonment with a non-parole period of 3 years. 3 The facts of the matter are not in dispute and can be briefly stated. The applicant was employed by the Dollar Growth Centre which is a financial planning institution. In the course of that employment he managed the financial affairs of various clients of the business. That included managing their investment funds and their superannuation entitlements. As a result, the applicant had access to the files of all the clients of the business and to the firm's computer database. 4 It is not necessary to set out in any detail how he was able to commit the various offences. Suffice it to say that the applicant prepared instruments for the redemption of invested funds which belonged to various clients. In all he dishonestly obtained more than $440,000 from 13 different clients. He did so by forging the signatures of clients, altering cheques so that he was named as payee and then diverting clients' monies into accounts over which he had control. 5 The applicant was arrested on 22 June 2002 as a result of an investigation into the affairs of one client of the business. The bank noticed a discrepancy when the applicant sought to bank a cheque for $33,000 which was originally issued to the client but which had the applicant's name typed upon it as payee. The applicant was arrested but initially denied any involvement in dishonest conduct. Subsequently he gave police permission to search his house and also told them that they would find paper work there which would implicate him in fraudulent activities. When he was re-interviewed, he made admissions which went beyond the matters of which the police were then aware. He said that the amount of money involved was in the vicinity of $200,000 to $300,000 and that there were approximately six clients involved. The applicant had a number of clients' files at his house which he handed over to police. One of the counts to which he pleaded guilty reflected the fact that he did not have permission to remove that client's file from his place of employment. 6 The applicant immediately wrote out a cheque for $100,000 and handed it to police in order that his employer could be partially reimbursed for the losses arising from his dishonest conduct. At that stage police were, as I have said, unaware of the magnitude of these offences. During the next few days restitution of a further amount of $75,000 was made. Thereafter the applicant, through his solicitor, provided police with further details as to the clients who had been defrauded. This was a time consuming exercise and demonstrated the extent to which he was then prepared to assist the authorities. The applicant's father gave evidence that he had borrowed from his bank in order that a further $100,000 could be made available by way of restitution. There still however remained a considerable amount of money outstanding. That loss was apparently met by the applicant's employer's insurance company. 7 The applicant was aged 30 when he stood for sentence. He was born in Fiji and had come to Australia with his family as a teenager. He enjoyed a happy childhood and came from a close, supportive and loving family. His father is a Hindu priest and the applicant had, for a number of years, assisted him in the performance of his religious duties. It was to the applicant's credit that prior to embarking upon this episode of criminality, he had had no prior convictions of any kind. There was evidence before the Court that the applicant was otherwise of good character and indeed the sentencing judge expressly said that he would take that matter into account in determining the appropriate sentence. 8 The sentencing judge also took a number of other matters into account on the applicant's behalf, which had the effect of ameliorating the otherwise appropriate sentence. His Honour allowed a discount of 25% to reflect the fact that the applicant had pleaded guilty at the earliest opportunity. Furthermore, his Honour said that "the offender's assistance extends beyond the pleas of guilty. His co-operation with the authorities provided a utilitarian benefit to them even before his pleas of guilty were entered and I will take this into account also." 9 His Honour also made a finding in the applicant's favour that he was contrite. This was best demonstrated, his Honour found, by his conduct after arrest in immediately making a payment of $100,000 to the police even though at that stage they were only investigating a much smaller sum of money. It was further demonstrated by the fact that the applicant had made restitution in the amount to which I earlier referred. Furthermore, his Honour observed, that the applicant had demonstrated contrition by voluntarily seeking counselling from Ms Margaret Lightfoot, who is apparently a psychosomatic specialist. His Honour concluded that the applicant's remorse and the insight which he had gained into his behaviour meant that he had already achieved "a large measure of rehabilitation". 10 The sentencing judge also took into account in the applicant's favour the delay of more than 12 months which had elapsed between arrest and sentence. During that time the applicant had been in a state of considerable anxiety as he awaited the outcome of these proceedings. Not only was the delay in no way attributable to the applicant but the evidence showed that he had done everything possible to facilitate the proceedings being brought to a conclusion at the earliest possible date. The delay occurred because it took the police some considerable time in which to complete an audit of the applicant's employer's business in order that the extent of his wrongdoing could be determined. 11 The sentencing judge also gave consideration to the hardship that the applicant's incarceration would have upon his family. In that context his Honour said: [p]art of the extracurial punishment which the offender has already suffered consists of him being aware that he is responsible for many members of his family suffering significantly. Not only will his wife and son lose their husband and father whilst he is in custody, but the revelation of these matters will mean that his father will have to resign as a priest. Until now the Hindu community has been kept ignorant of the offender's conduct, but following sentencing all will be revealed. The offender's father was clearly distressed at his inability to carry on as his ancestors have done, and the consequences for the offender's family, such as this, are part of the punishment he will suffer. 12 Finally, the sentencing judge had regard to the applicant's medical condition. As to that issue his Honour observed: The offender showed me a swelling in his left forearm which is apparently a fistula, which has been treated on occasions, but symptoms have gradually returned. He has pain in his left arm which varies, on occasions being severe. He gets very severe pain two or three times a week. This pain lasts for between a few hours or something much shorter. He treats the pain with analgesics. The offender's time in custody will be harder than it would have otherwise been, because of the problem he has with his left arm. 13 No complaint is made about that finding although it will be necessary to refer to this question again in due course. 14 The sentencing judge quite properly rejected a submission that a sentence of periodic detention would have been an appropriate sentencing outcome. His Honour also rejected a submission, again correctly in my view, that concurrent sentences should be imposed. His Honour was however prepared to make a finding of "special circumstances" and the sentences which were imposed gave effect to that finding. His Honour did so in order to ensure that the rehabilitation which the applicant had already achieved was not put in jeopardy and also because there was a partial accumulation of the sentences. 15 On any view of the matter, these were serious offences of dishonesty. Not only did they involve large sums of money but the offences revealed a course of conduct on the applicant's part. They were perpetrated over a period of about 3½ years, that is from November 1998 until May 2002. It appears that the applicant's offending conduct only ceased when it was discovered by the authorities. The offences required considerable planning and involved a significant breach of the trust which was reposed in the applicant by his employer. Moreover the applicant was, according to the agreed statement of facts which were before the sentencing judge, motivated entirely by greed. In that context his Honour observed that "the offender himself gave evidence that he spent his ill-gotten gains on what he described as lifestyle assets, such as cars, investment property, shares, jewellery and education. The offender was neither a gambler nor a drug addict. He simply wanted to lead a better standard of life with other people's money. It is hard to imagine a more culpable motivation for stealing from elderly people who needed their money for their retirement." 16 This latter observation was a reference to the fact that the victims of these various offences were generally elderly people who had invested what amounted to their life savings in order to provide for their retirement. The applicant acknowledged realising that that is what he was doing although he said that this realisation only dawned upon him in early 2002. Nevertheless, as his Honour observed, his criminal misconduct still continued well past that date. 17 The evidence at the sentencing hearing revealed that the applicant was somewhat resentful of the fact that his remuneration from his employer was so low. Indeed he sought to justify his actions by telling the sentencing judge that he was "on a low salary and I felt I had to be compensated another way". 18 The sentencing judge was bound to impose an additional penalty upon the applicant in order to reflect the significant criminality revealed by the further offences on the Form 1 document. See Attorney-General's Application under s 37 of the Crimes (Sentencing Procedure) Act 1999 No 1 of 2002 (2002) 127 A Crim R 180. The fact that there were so many of these offences indicates just how many individual criminal acts the applicant had committed. Given all the circumstances of these offences, it was necessary to ensure that general deterrence assumed some prominence in the sentencing process. See R v Pantano (1990) 49 A Crim R 328. 19 The sole ground of appeal is that the sentences imposed were manifestly excessive. In support of this ground the applicant seeks to rely upon what is described as "fresh evidence". The material could only be described as fresh in the sense that none of it was before the sentencing judge. It consists of a report dated 2 February 2004 from Dr Ben Teoh, who described himself as a consultant psychiatrist and physician in addiction medicine. Dr Teoh examined the applicant on 26 January 2004, that is some three months after the applicant was sentenced. Dr Teoh had available to him at the time of preparing his report, the various reports which had been before the sentencing judge together with a document which is described as "a statement of instructions" from the applicant dated 3 December 2003. 20 Affidavits from the applicant's wife, who gave evidence on his behalf during the course of the sentence proceedings, and from his two sisters, neither of whom gave evidence at that time, were also filed. Ultimately however reliance was only really placed upon Dr Teoh's report. 21 In the opening part of Dr Teoh's report the telling observation is made that the applicant "felt that there are relevant medical conditions that the Court was not fully informed of at the time of sentencing". 22 Since the applicant seeks to rely upon the opinion which Dr Teoh expresses in his report, it is convenient to set out that opinion and the context in which it is expressed. The author said: Mr Maharaj believed that the A-V malformation on his left arm had influenced his behaviour leading to the offences. He stated that he was worried about his arm, particularly that his condition may deteriorate to the point where he would either not be able to use his arm or he would lose it completely. Consequently, he was concerned that he would not be able to gain employment and support his family financially. He felt a need to accumulate money so that he would be able to support his family and make them feel financially secure. It is my opinion that the psychological effects of the chronic pain, the deformity of his arm and uncertainty of his physical condition had partly contributed to the behaviour leading to the offences. It is likely that the fear of his long-term financial insecurity as a result of the uncertainty of his health, could have, consciously or subconsciously, influenced him to obtain money "quickly". However, his psychological state was not the only contributing factor. There were other contributing factors including unsupervised access to his clients' fund, opportunity and greed. Mr Maharaj suffered from a "reactive" depression as a result of his physical condition; however he does not have a psychiatric diagnosis. He had psychological problems dealing with the chronic nature of his problems including the deformity and pain. (emphasis added) 23 As I have said, Dr Teoh had available to him instructions from the applicant in which the applicant sought to explain how the concerns which he says he had about his arm had contributed to his having committed these offences. In that document the applicant said that: Doctor Stephens advised me when the surgery was last undertaken that there was the possibility if surgery did not go to plan that blood vessels might be permanently damaged and there would be a need for the arm to be amputated. I fixated on that piece of advice. I am to this day convinced that my condition will eventually worsen to the point where I will lose my arm. That fear came to dominate my day to day thinking. I became obsessed with the idea of needing to support my family. I wanted to ensure that I had a nest egg to provide for them in the event I was no longer able to work and support them, should I loose [sic] my left arm. In my work as a financial planner I was representing a lot of people who were looking to invest lump sums received by way of workers compensation. Their injuries and their inability to work just served to remind me of my own fears. I knew that if my illness grew worse and I was unable to work that there would be no compensation. I felt that I was earning only a limited amount that would never allow me to get ahead. 24 The other affidavits from the lay witnesses purport to provide some corroboration by way of their observations of the applicant's reaction to his medical condition and its impact upon him. 25 In R v Cartwright (1989) 17 NSWLR 243 it was decided that it is not the customary practice of this Court to receive fresh evidence on sentence appeals and that proper grounds must be established before its discretion to do so will be exercised. See also R v Lanham [1970] 2 NSWR 217. 26 In R v Fordham (1997) 98 A Crim R 359, Howie AJ (as his Honour then was) with whom Hunt CJ at CL and Smart J agreed, made the following observations concerning the relevant principles to be applied by this Court in respect of the reception of fresh or new or additional evidence. His Honour said: Generally before fresh or new evidence will be received by this Court, it must be shown that the sentencing of the appellant in the absence of that evidence resulted in a miscarriage of justice. As a general rule, where that evidence was available to the defence at the time of sentencing, a miscarriage of justice would rarely result simply from the fact that the evidence was not before the sentencing judge, even if the evidence may possibly have had an impact upon the sentence passed. However, fresh evidence has been received by this Court where a miscarriage of justice may have occurred because there has been incompetent legal representation at the hearing before the sentencing court: Abbott (1984) 17 ACrimR 355 or where there has been negligence or carelessness in the presentation of the defence: McKenna (unreported, Court of Criminal Appeal, NSW, No 60705 of 1991, 16 October 1992). It has been held that new evidence may be admitted where the evidence has real significance to the sentencing proceedings, and where the significance of the evidence was unknown to the appellant and the existence of that evidence was not made known to the legal representatives at the time of sentencing: Goodwin (1990) 51 ACrimR 328 : compare De Marco (unreported, Court of Criminal Appeal, NSW, No 60024 of 1993, 20 November 1995). There is also a general power in the court to receive fresh or new evidence where the interests of justice require that course: Many (1990) 51 ACrimR 54 . (at 377-378) 27 In the light of those considerations, it is convenient to review the material which was before the sentencing judge upon this issue. First, there was a short letter from Dr Stephens who reported that the applicant had first consulted him in 1996 "with an extensive AV fistula on the flexor side of the left arm" which had apparently been embolised in 1994. In July 1996 Dr Stephens performed an excision of the AV fistula. Another smaller procedure was conducted in January 1997. Dr Stephens reported that upon a review undertaken a month later there were "no signs of any residual fistula present in the forearm, and [the applicant] had full painless movement in the arm". The applicant saw Dr Stephens again in November 2001. He presented with symptoms which suggested that there was recurrence of some part of the AV fistula. Dr Stephens recommended that the applicant have a scan of his arm. He had not however seen the applicant since that time and was unable, in those circumstances, to offer a prognosis about his condition at the time of sentence. 28 The applicant himself gave the following evidence about this issue in the sentence proceedings: STRICKLAND: Q A report has been tendered from a Dr Stephens in relation to your left forearm? A Yes.