Commonwealth Director of Public Prosecutions v Moodliar [2013] QDC 106

DISTRICT COURT OF QUEENSLAND CITATION: Commonwealth Director of Public Prosecutions v Moodliar [2013] QDC 106 PARTIES: COMMONWEALTH DIRECTOR OF PUBLIC PROSECUTIONS (Appellant) and ALISTAIR CLINTON MOODLIAR (Respondent) FILE NO: D486/12 PROCEEDING: Appeal against sentence DELIVERED ON: 10 May 2013 DELIVERED AT: Southport HEARING DATE: 29 April 2013 JUDGE: Judge C F Wall QC ORDERS: 1. Appeal allowed. 2. Sentence below set aside and in lieu thereof the respondent is convicted and sentenced to imprisonment for 4 months but is to be released forthwith upon giving security by recognisance in the sum of $500 conditional that he be of good behaviour for 3 months. LEGISLATION: Criminal Code 1995 (Cth), section 135 Crimes Act 1914 (Cth), sections 16A, 16F, 17A, 19B CASES: R v Price (2008) QCA 30 R v Holdsworth (1993) QCA 242 Ryan v R (2001) 286 CLR 267 Guy v Yek [2010] TASSC 34 R v Tsiaris [1996] VR 398 R v Goodger [2009] QCA 377 R v McGlynn [1981] Qd R 526 R v Dunn [1994] QCA 147 R v Neumann ex-parte A-G (Qld) [2007] 1 Qd R 53 CATCHWORDS: JUSTICES – appeal by Crown against sentence – pharmacist – obtaining a financial advantage – Pharmaceutical Benefits Scheme – whether sentence manifestly inadequate – relevance of general deterrence and psychological factors. COUNSEL: Mr M Copley SC for the Appellant Mr M J Byrne QC for the Respondent -- 1 of 12 -- 2 SOLICITORS: Commonwealth Director of Public Prosecutions for the Appellant Potts Lawyers for the Respondent Introduction [1] On 20 August 2012 the respondent pleaded guilty in the Southport Magistrates Court to one count of obtaining a financial advantage in contravention of s 135.2 of the Criminal Code 1995 (Cth). The respondent was a self-employed pharmacist. The financial advantage he obtained was $7,193.46. [2] The respondent was, pursuant to s 19B(1)(b)(i) and (c) of the Crimes Act 1914 (Cth), discharged without conviction upon entering into a recognisance to be of good behaviour for 2 years. He was also ordered to make reparation to the Commonwealth of $7,193.46. [3] The Commonwealth appeals against the sentence on the ground that it is manifestly inadequate. [4] Section 135.2(1) of the Criminal Code 1995 (Cth) is in these terms: “135.2 Obtaining financial advantage (1) A person is guilty of an offence if: (a) the person engages in conduct; and (aa) as a result of that conduct, the person obtains a financial advantage for himself or herself from another person; and (ab) the person knows or believes that he or she is not eligible to receive that financial advantage; and (b) the other person is a Commonwealth entity. Penalty: Imprisonment for 12 months.” [5] Section 135.2(1) is an offence of general application and is not limited to pharmacists. [6] Section 19B Crimes Act 1914 (Cth), so far as is relevant is in these terms: “19B Discharge of offenders without proceeding to conviction (1) Where: (a) a person is charged before a court with an offence against the law of the Commonwealth; and (b) the court is satisfied, in respect of that charge or more than one of those charges, that the charge is proved, but is of the opinion, having regard to: (i) the character, antecedents, cultural background, age, health or mental condition of the person; -- 2 of 12 -- 3 (ii) the extent (if any) to which the offence is of a trivial nature; or (iii) the extent (if any) to which the offence was committed under extenuating circumstances; that it is inexpedient to inflict any punishment, or to inflict any punishment other than a nominal punishment, or that it is expedient to release the offender on probation; the court may, by order: (c) dismiss the charge or charges in respect of which the court is so satisfied; or (d) discharge the person, without proceeding to conviction in respect of any charge referred to in paragraph (c), upon his giving security, with or without sureties, by recognizance or otherwise, to the satisfaction of the court, that he will comply with the following conditions: (i) that he will be of good behaviour for such period, not exceeding 3 years, as the court specifies in the order” The circumstances of the offending [7] The offence was committed between 1 June 2006 and 5 May 2007 and involved the respondent claiming (and receiving) benefits from the Pharmaceutical Benefits Scheme (“PBS”) for dispensing prescribed drugs when he had not in fact dispensed those drugs. The total value of benefits claimed which he knew, or believed he was not entitled to, was $7,193.46. [8] The Magistrate referred to patients as vulnerable, elderly and infirm who trusted the respondent. He had them pre-sign prescriptions and he received the benefit. He admitted he was responsible for lodging all PBS claims at his pharmacy. The respondent‟s offending encompassed procuring some customers to obtain unnecessary prescriptions from their doctor so that the respondent could continue to make false claims and procuring his pharmacy assistant to sign, representing herself to be customers. The sentencing approach of the Magistrate [9] The Magistrate found, in accordance with s 19B(1)(b)(i) of the Crimes Act 1914 (Cth) that by reason of the respondent‟s character, antecedents, age and health or mental condition it was “inexpedient to inflict any punishment”. [10] In reaching this conclusion the Magistrate said “I am also very much aware that, whilst deterrence is a significant feature of punishing for these types of offences, there‟s different features of deterrence for different classes of population. In deterring general members of the public from committing frauds on -- 3 of 12 -- 4 Commonwealth entities, it is very important to impose a penalty that is understood across the board as being something that is significant, and in terms of general deterrence to members of the public, what they seem to understand is terms of imprisonment. In respect of a particular class or category of persons to whom deterrence must be sheeted home to, I am very mindful of the fact that there are other things, or other factors which would have greater deterrence than the imposition of terms of imprisonment and particularly in the case of pharmacists, the shame, the humiliation, the embarrassment of having to go back to study, the financial loss of five years of your life; you have had to sell your business at a very low time in the market for a loss. You have had to sell your house and move back in with your family. Those factors, to me, are of a greater deterrence to members of that particular class of person, or pharmacists… What I am satisfied is, that your character, antecedents, particularly the antecedents, age health and mental condition of your person, do give rise to the first limb of section 19B, particularly the price that you‟ve paid over the last five years. You have been deregistered. You have lost your business. You have lost your house. Your reputation has suffered. The humiliation that you have incurred, the fact that you haven‟t been able to work (as a pharmacist) for five years are, to me, relevant circumstances which, to me enliven the first limb of section 19B. I am further satisfied that, taking those matters into account and your preparedness to pay the money and your early plea of guilty, I am satisfied that it is inexpedient to inflict any punishment other than a nominal punishment.” [11] So far as s 19B(1)(b)(ii) and (iii) are concerned the Magistrate did not consider the offence to be of a trivial nature or to have been committed under extenuating circumstances. The respondent’s personal circumstances [12] The respondent has a disciplinary history as a pharmacist which is relevant to understanding the errors which the Commonwealth submits the Magistrate made and which render the sentence manifestly inadequate. [13] His registration as a pharmacist was suspended by the Pharmacy Board of Queensland on 8 May 2008 because it was found he had been dispensing excessive quantities of restricted drugs, dispensing without a prescription, supplying on more occasions than a valid repeat prescription permitted and maintaining false records. These matters fell within the same time frame as the present offence but were quite separate from it. The only connection was the time frame and the respondent‟s mental condition at the time. -- 4 of 12 -- 5 [14] As a result the Health Practitioners Tribunal (HPT) on 26 November 2008 found the respondent guilty of unsatisfactory professional conduct and his registration as a pharmacist was cancelled. It was also ordered that he not be entitled to apply for re- registration for 18 months and that before any such application he successfully complete the University of Queensland Pharmacists Re-Entry Program and the Pharmaceutical Society of Australia Pre-Registration Training Program. Upon re- registration he was to work under the supervision of a registered pharmacist for 12 months and was not to own his own pharmacy for 2 years from the date of re- registration. The disciplinary charges were obviously of a serious nature. They effectively meant that he could not practice for a little over 2 years. [15] His present conduct resulted in a charge being laid on 2 February 2010 which was reduced to the present charge to which he pleaded guilty on 20 August 2012. See the chronology, Ex 2. Any delay (which is quite substantial/lengthy both as to being charged and then being prosecuted) is not his fault. Investigation of the offence commenced much earlier. He was interviewed about the matter on 26 May 2008. He has satisfied the re-training requirements ordered by the Health Practitioners Tribunal but he remains unregistered and this seems to be because of the present proceeding. [16] He told Dr Jacqui Yoxall, a psychologist, that it took over 100 phone calls before he could find a pharmacist willing to offer him pre-registration training and that working under supervision was “extremely humiliating and emotionally taxing”. See Ryan v R (2001) 286 CLR 267 at 330 per Kirby J. It was, he said, “mind- blowing how easily one can be stigmatised”. [17] As to his “health or mental condition” her Honour earlier referred to long working hours causing a “burnout” and the opinion of Dr Yoxall that it‟s likely that the respondent was at the time of his offending “experiencing undiagnosed and untreated depression and that his concentration was compromised”. Dr Yoxall‟s opinion was that the respondent “had developed clinical depression and anxiety which in turn impacted substantially on his attention and concentration, organisation and judgment”. [18] In dealing with s 19B(1)(b)(iii) her Honour accepted that at the time of his offending the respondent was suffering depression and was under a “great deal of stress”, but said: -- 5 of 12 -- 6 “… this is really what most people who run their own businesses have to do and many business people work excessive hours and work very hard and suffer burnout, but they don‟t resort to these types of offences.” [19] Notwithstanding these remarks her Honour nevertheless seems to have at least accepted part, if not all, of the diagnosis of Dr Yoxall for the purposes of s 19B(1)(b)(i). The Commonwealth’s appeal [20] The appellant‟s position as stated by Mr Copley SC and which was its position before the Magistrate is that for a professional person to make false claims on the Commonwealth repeatedly over a period of 18 months, a conviction and a sentence of imprisonment with immediate release or a substantial fine was the appropriate sentencing response and anything less than that is manifestly inadequate. A conviction is automatic with a fine or a sentence of imprisonment. [21] Mr Copley referred to “offending committed by a man of mature years over a lengthy period involving a substantial sum of money in a situation where the Commonwealth has to rely on the honesty of (such) professional persons to administer and make the PBS work”. He submitted that the respondent, a mature man running his own business, deliberately, repeatedly and persistently breached his obligations under the PBS. [22] The appellant contends that the Magistrate over- emphasised the s 19B(1)(b)(i) factors. The respondent contends that she did not and that no error in the exercise of the sentencing discretion has been established. I didn‟t really understand Mr Byrne QC to dispute Mr Copley‟s description of the nature of the respondent‟s offending rather he disputed it should have the effect contended for by Mr Copley. [23] Mr Copley submitted that the sentence is manifestly lenient notwithstanding the factors relied on by the Magistrate and emphasised by Mr Byrne. He submitted that the Magistrate placed insufficient emphasis on the need for the sentence to have a general deterrent effect and that her Honour‟s consideration of this aspect over- emphasised deterrence to pharmacists as a class at the expense of broader general deterrence. [24] Mr Copley submitted that the general deterrent effect of the sentence must be broader than just the particular class of pharmacists; he contended, correctly, that -- 6 of 12 -- 7 the offence is not one which only a pharmacist can commit, it is not confined to pharmacists. The appellant‟s written submissions in this respect are: “The pharmacist‟s professional qualifications, responsible position and position of trust enhance rather than dilute the need for deterrence. See R v Price, [2008] QCA 30; R v Lovell [2012] QCA 43 at [47].” [25] In R v Price, supra, the applicant was a medical practitioner. She was convicted of unauthorised writing of prescriptions under the PBS in contravention of the National Health Act 1953 (Cth). She did so to help elderly patients who could not otherwise afford the drugs. She received no financial benefit unlike the respondent. She was ordered to make reparation of $27,821.93. She pleaded guilty. She was sentenced to 12 months imprisonment to be released forthwith upon a $1,000 good behaviour bond for 2 years. The maximum penalty was imprisonment for 2 years. In the present case it is 1 year. An appeal by her against sentence was dismissed. [26] In dismissing her appeal Keane JA said: “[21] Next it must be said that, while there are many kinds of crime where the efficacy of deterrent sentences in the suppression of crime may be doubted – crimes of passion are an obvious example – crimes which involve a deliberate decision to abuse governmental arrangements for the provision of social welfare are crimes of calculation. It is not at all unreasonable to suppose that in this field of conduct potential offenders may be deterred from offending by calculating the prospect of punishment. Indeed, in R v Holdsworth, [1993] QCA 242 at [7], Pincus JA and Thomas J said that the imposition of penalties is the only way to deter „those minded to defraud governmental agencies‟ from engaging in this kind of activity. As I have said, this is not a case where a governmental agency has been a target of fraudulent misconduct, but the applicant here deliberately breached her obligations as a prescriber of drugs under the PBS. [22] A deterrent sentence in a case like the present is distinctly likely to be brought to the attention of persons in the privileged position occupied by the applicant in the administration of the PBS. It can reasonably be expected to alert them that, if they choose to take it upon themselves to subvert arrangements made for the deployment of scarce public funds in the public interest, they do so at the risk of punishment. [23] It should also be recognised that it was open to the learned sentencing judge to proceed on the basis that the applicant's motivation was not entirely altruistic. The applicant enhanced the goodwill attaching to her practice by breaking the rules of the PBS in circumstances where the viability of the PBS depends on medical practitioners complying with the rules. When one bears in mind that the applicant derived some -- 7 of 12 -- 8 general economic benefit from her decision to act in contravention of the rules to require the applicant to make reparations to the PBS of the sum of which the PBS was unlawfully billed does not seem to be an excessive punishment.” [27] In R v Holdsworth, Pincus JA and Thomas J also said: “It would be surprising if defrauding the Commonwealth of significant sums of money by criminal activity could be regarded as capable of deterrence by anything less than a general expectation of custodial punishment if the offender is caught. Any notion that the Commonwealth and its departments are fair game for this type of activity is to be resisted.” [28] Mr Copley submitted that just because the offence here does not have an intention to defraud as an element doesn‟t make these remarks inapplicable and I agree. The Commonwealth here, unlike in Price, was the target of fraudulent misconduct by the respondent. Mr Byrne conceded the relevance of the Holdsworth remarks to the present case but submitted they had to be balanced against the respondent‟s particular position. [29] In relation to the s 19B(1)(b)(i) factors relied upon by her Honour, Mr Copley submitted that there is nothing exceptional about the respondent‟s age, 35 when sentenced, or his character – “like all professional people, hitherto good”. The respondent’s arguments [30] Mr Byrne relied on the following matters: (a) the critical facts here are quite different to the normal and to other comparable cases; (b) the substantial delay in relation to both charge and prosecution – and its effect on the respondent; (c) the schedule of comparable cases is of little, if any, assistance (I agree); (d) the effect a conviction will have on the respondent – it will at least make it difficult for him to obtain re-registration as a pharmacist; it may amount to a permanent block to re-registration, more so for a sentence of imprisonment; (e) his psychological state at the time of offending (and at sentence) (and Dr Yoxall seems to say this contributed to both the HPT charges and the present) rendered him less culpable and explains to -- 8 of 12 -- 9 a degree the conduct from someone with otherwise impeccable antecedents. This, it was submitted, may greatly diminish any element of deterrence as a sentencing objective and means he is “not an appropriate vehicle for general deterrence” or specific deterrence. See R v Tsiaris [1996] VR 398 at 400 and R v Goodger [2009] QCA 377; (f) he has not re-offended and has demonstrated rehabilitation; (g) the matters relied on by the Magistrate and his claims to Dr Yoxall that his earning capacity, had he not been suspended, “would have been in the vicinity of $500,000”. [31] Mr Byrne also referred to the evidence in relation to 100 phone calls in support of his submission that general deterrence was working. He submitted that 100 phone calls was because his name was known amongst pharmacists as someone “under investigation” and referred to the fact that committal proceedings in relation to the respondent‟s present offending were publicised in the Gold Coast Bulletin and the Sunday Mail – “it was well known”. Discussion [32] Whilst her Honour‟s remarks in relation to deterrence are, with respect, somewhat inelegantly expressed, I am not satisfied that what she was intending to say is wrong to the extent submitted by Mr Copley. In this respect her words accord with the remarks of the Magistrate in Guy v Yek [2010] TASSC 34 about which Tennent J, on appeal, took no issue, namely: “Having regard to the course of these proceedings, I would have thought that for most pharmacists, that the mere fact of these proceedings, that they have been taken by the Commonwealth and brought by the Commonwealth to a successful completion, would in itself, be a deterrent from conducting themselves in the way in which the defendant conducted herself on these occasions.” One should not however elevate these remarks to a level where the need for a sentence having a general deterrent effect is completely eliminated even in a case where psychological conditions also bear upon the individual‟s offending. Broader considerations are involved in offences of defrauding the Commonwealth (and the present offence is of this type). [33] I do though accept that the present charge appears to be the reason the respondent has not been able, so far, to secure re-registration. He applied to be re-registered at -- 9 of 12 -- 10 the end of May 2010 after completing his re-training. He was charged for his present offending on 2 February 2010 and so far his application for re-registration has been refused. This state of affairs apparently continues pending the disposition of this appeal. [34] It is not though the case that the sale of his business (on 2 June 2008) at a loss and the sale of his house were due to the present offence (or its predecessor) as opposed to the disciplinary proceedings. [35] To this extent I consider her Honour fell into error in a number of related respects. She relied particularly on “the price” the defendant has paid over the last 5 years whereas the first 2 years were due to the HPT matters, not the present charge; likewise his de-registration and the loss of his business and house were due to the HPT matters. Reputational damage and humiliation can be attributed to both matters and not solely the present charge and the fact that he hasn‟t been able to work as a pharmacist for 5 years is not entirely due to the present charge. All matters though are generally relevant to the defendant‟s antecedents, but to the extent that her Honour found them entirely referable to the present charge (which it appears she did) she erred. [36] Delay is conceded by the Crown and it is not the respondent‟s fault. [37] The critical facts referred to by Mr Byrne are due firstly to the HPT charges and latterly to the present charge. They are not entirely consequent upon the present charge. [38] As to a conviction Mr Copley referred to the Criminal history registration standard of the Pharmacy Board of Australia which lists 10 factors to be considered in deciding whether a pharmacist‟s criminal history is relevant to the practice of his profession. Factor 3 is whether a finding of guilt or a conviction was recorded. In descending order of relevance a conviction rates above a finding of guilt. Factor 4 is the sentence imposed and the weight placed on the sentence will generally increase as the significance of the sentence increases. At the end of the day these are two only of 10 factors to consider and it is by no means the case that the respondent will not be granted re-registration if a heavier sentence is imposed. [39] The respondent‟s psychological state is clearly relevant but again this is a causal factor in relation to both the HPT charges and the present offending. In my view the condition of the respondent justified moderation not elimination of both general -- 10 of 12 -- 11 and specific deterrence. The Magistrate in my view over emphasised personal factors and this caused her to eliminate these factors as relevant and applicable to the sentence here. [40] In my view the present case fits more within the remarks of Keane JA in R v Goodger supra at [21] (Fraser JA and Atkinson J agreeing): “This Court has accepted the proposition that, generally speaking, a mental disorder short of insanity may lessen the moral culpability of an offender and so reduce the claims of general or personal deterrence upon the sentencing discretion.” [41] In R v McGlynn [1981] Qd R 526 at 530 (referred to in R v Dunn [1994] QCA 147 at page 8) the proper approach was held to be, first, to determine the “objectively appropriate” sentence and then to decide whether it should be diminished because of the offender‟s mental condition. [42] I appreciate that it has also been said that “in the case of an offender suffering from a mental disorder or abnormality, general deterrence is a factor which should be given little weight… because such an offender is not an appropriate medium for making an example to others”. See R v Neumann ex-parte A-G (Qld) [2007] 1 Qd R 53 at [27]. [43] In my view the sentence here, looked at objectively, notwithstanding the respondent‟s personal and psychological circumstances would have virtually no general deterrent effect and to this extent I consider her Honour‟s sentencing discretion miscarried. In my view the respondent‟s psychological condition was not of a level which eliminated the need for a general deterrent component of the sentence. Section 135.2 is not limited to pharmacists and any sentence should recognise its broader reach. [44] Mr Copley submitted that an “objectively appropriate” sentence would be imprisonment for 6 months with immediate release and a 2 year good behaviour bond. [45] In my view the sentence imposed here failed to accord sufficient weight to the serious nature of the offending and the circumstances surrounding its commission. The sentence here is not, in my view, a “deterrent sentence” of the nature referred to in the passage quoted from the judgment of Keane JA in Price. -- 11 of 12 -- 12 [46] The character, antecedents, age, health and mental condition of the respondent can, I consider, be sufficiently recognised by a sentence less than that contended for by the Commonwealth bur more than that imposed by the Magistrate. Result [47] For the reasons I have given the appeal will be allowed and the sentence imposed below will be set aside. [48] In considering the sentence to impose upon the respondent I take into account relevant matters listed in s 16A of the Crimes Act 1914 (Cth) in particular those listed in sub-sections (2)(a), (e), (f), (g), (h) (limited – he admitted responsibility for lodging the claims but denied any wrongdoing), (j), (k), (m) and (n). I also take into account the fact that this is a crown appeal against sentence and the fact that the respondent has been subject to a 2 years good behaviour bond since 20 August 2012 and has not breached it. [49] In terms of s 17A of the Crimes Act 1914 (Cth) I am, for the reasons I have given, satisfied that no other sentence than imprisonment is appropriate in all the circumstances of the case. In my view a substantial fine, probation or community service or a combination would not be a sufficient sentencing response for this type of offending notwithstanding the personal factors referred to by Mr Byrne. [50] In lieu of the sentence imposed below, the respondent will be convicted and sentenced to imprisonment for 4 months but I direct that he be released forthwith upon giving security by recognisance in the sum of $500 conditional that he be of good behaviour for a period of 3 months. [51] The reparation order will remain. [52] In accordance with s 16F of the Crimes Act 1914 (Cth) the sentence will now be explained to the respondent. -- 12 of 12 --