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Writer's pictureGeoff Harrison

ICO’s & Commonwealth Offences

Updated: Mar 17



Criminal Barrister, Criminal Lawyer, ICO's, Intensive Corrections Orders, Commonwealth Offences

Published by Geoff Harrison | 25 August 2023


Section 20AB of the Crimes Act 1914 (Cth) - ('the Act') provides the power for a court to impose a State based sentencing option for a Federal offence. The imposition of an Intensive Corrections Order (ICO) requires a three-step approach (as per Chan v R, below):

  1. the court must be satisfied that no penalty other than imprisonment is appropriate; if so

  2. determine the length of the sentence;

  3. if the setence imposed is less than two years for a single offence or three years for an aggregate sentence, the court must consider whether an ICO should be imposed.

The sentencing court is required to have regard to the matters contained within s16A of the Act for the pruposes of the first two steps but then have regard to the purposes of sentencing in s3A of the Crimes (Sentencing Procedure) Act 1999 when considering whether to impose an ICO under the thrid step.


When considering the third step and whether to impose an ICO or not, community safety must be the 'paramount consideration' (s66(1)). Under s66(2) when considering community safety, the court must assess whether serving the sentence by way of an ICO or full-time detention is more likely to address the offender's risk of reoffending. Whilst not determinative, community safety will normally be decisive, unless the evidence is inconclusive, on the decision to make or refuse to make an ICO (as per N Adams J at [129] in Chan v R and Stanley v DPP (NSW) 2023 HCA 3 at [76].


A summary of the significant ICO provisions from the Judicial Bench Book can be found here.


Cases:



__________________________________________________________________


Chan v R [2023] NSWCCA 206 (23 August 2023)


Court of Criminal Appeal


Supreme Court

New South Wales

Case Name:

Chan v R

Medium Neutral Citation:

[2023] NSWCCA 206

Hearing Date(s):

3 July 2023

Date of Orders:

23 August 2023

Decision Date:

23 August 2023

Before:

Kirk JA at [1];


Rothman J at [11];


N Adams J at [25].

Decision:

(1) Leave to appeal is granted.


(2) The appeal is allowed.


(3) The sentence imposed by Bright DCJ on 10 November is quashed and in lieu thereof the following sentence is imposed:


(a) An aggregate sentence of 8 months and 17 days imprisonment to commence on 23 August 2023.


(4) Pursuant to s 7(1) of the Crimes (Sentencing Procedure Act) 1999 (NSW)t, the sentence imposed on the offender is to be served by way of an intensive correction order commencing on 23 August 2023 and expiring on 9 May 2024.


(5) The standard conditions of the order will apply. Namely,


(a) The offender must not commit any offence; and


(b) The offender must submit to supervision by a community corrections officer for the term of the order.


(6) If the offender fails to comply with the conditions of the order, sanctions may be imposed by the Commissioner of Corrective Services. Those sanctions may include a formal warning, the imposition of more stringent conditions or may include revocation of this order. If the order is revoked, the offender may be required to serve all or some of the period of the sentence in full-time custody.


(7) The offender is to report to Community Corrections office as soon as practicable but no later than within seven days.


(8) A copy of this order will be forwarded to the offender.

Catchwords:

CRIME — sentence appeal — consideration of intensive correction order when sentencing for federal offence – three-step approach – whether sentencing judge required to consider s 3A of the Crimes (Sentencing Procedure Act) 1999 (NSW) – material differences between s 3A of the Sentencing Procedure Act and 16A of the Crimes Act 1914 (Cth) – error established – applicant resentenced – exceptional circumstances found


CRIME — sentence appeal — consideration of intensive correction order – community safety paramount – community safety incudes non-violent harms to the community – other purposes of sentencing subordinate where sentencing judge found an ICO would be favourable for community safety

Legislation Cited:

Corporations Act 2001 (Cth), s 1308(2)


Crimes Act 1900 (NSW), s 178BB


Crimes Act 1914 (Cth), ss 16A, 17A, 20AB, 20(1)(b)


Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 7, 8, 66-69


Criminal Appeal Act 1912 (NSW), s 5(1)(c)


District Court Act 1973 (NSW), s 176


Judiciary Act 1903 (Cth)


National Health Act 1953 (Cth), s 103(5)(g)


Cases Cited:

Attorney-General (Cth) v Huynh (2023) 97 ALJR 298; [2023] HCA 13


Australian Education Union v Department of Education and Children's Services (2012) 248 CLR 1; [2012] HCA 3


Casella v R [2019] NSWCCA 201


Decision restricted [2023] NSWCCA 186


Director of Public Prosecutions (Cth) v Beattie (2017) 270 A Crim R 556; [2017] NSWCCA 301


Fangaloka v R [2019] NSWCCA 173


Homewood v R [2023] NSWCCA 159


Huynh v R (2021) 105 NSWLR 384; [2021] NSWCCA 148


Kentwell v The Queen (2014) 252 CLR 601; [2014] HCA 37


Mandranis v R (2021) 289 A Crim R 260; [2021] NSWCCA 97


Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; [1996] HCA 6


Mourtada v The Queen (2021) 290 A Crim R 514; [2021] NSWCCA 211


Patel v R (2022) 366 FLR 314; [2022] NSWCCA 93


Putland v The Queen (2014) 218 CLR 174; [2014] HCA 8


R v Agius; R v Zerafa (2012) 87 ATR 528; [2012] NSWSC 978


R v Boughen; R v Cameron (2012) 215 A Crim R 476; [2012] NSWCCA 17


R v Pogson; R v Lapham; R v Martin (2012) 218 A Crim R 396; [2012] NSWCCA 225


R v Pullen (2018) 275 A Crim R 509; [2018] NSWCCA 264


Rizeq v Western Australia (2017) 262 CLR 1; [2017] HCA 23


Stanley v Director of Public Prosecutions (NSW) (2021) 107 NSWLR 1; [2021] NSWCA 337


Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3


The Queen v Gorgy (NSWDC 17 April 1998, unreported)


Tonga, Samuel v R [2023] NSWCCA 120


Waterstone v R [2020] NSWCCA 117


Williams v The King [No 2] (1934) 50 CLR 551; [1934] HCA 19


Zheng v R [2023] NSWCCA 64


Texts Cited:

Crimes (Sentencing Procedure) Amendment (Sentencing Options) Act 2017 (NSW)


New South Wales, Parliamentary Debates, Legislative Assembly, 11 October 2017, Mark Speakman

Category:

Principal judgment

Parties:

Felix Yue-Sing Chan (Applicant)


Rex (Respondent)

Representation:

Counsel:


D Jordan SC with C O’Neill (Applicant)


R Ranken with E Forsyth (Respondent)


Solicitors:


Aulich Criminal Law (Applicant)


Commonwealth Director of Public Prosecutions (Respondent)

File Number(s):

2021/0039773

Publication Restriction:

Nil.

Decision under appeal:


Court or Tribunal:

Queanbeyan District Court

Jurisdiction:

Criminal

Date of Decision:

10 November 2022

Before:

Bright DCJ

File Number(s):

2021/00309773


HEADNOTE


[This headnote is not to be read as part of the judgment]


On 10 November 2022, the applicant was sentenced in relation to three offences under s 103(5)(g) of the National Health Act 1953 (Cth) for making false claims on the Pharmaceutical Benefits Scheme for prescriptions that he had not dispensed. He received an aggregate sentence of 2 years imprisonment and was ordered to be released on a Recognizance Release Order after serving 14 months of his sentence. The sentencing judge found that a term of imprisonment was warranted and declined to impose an Intensive Correction Order (ICO).


The sentencing judge was satisfied that the applicant was remorseful, had good prospects of rehabilitation and was unlikely to reoffend: [66]. Her Honour gave the following reasons for declining to impose an ICO (at [69]):


“I note that because I am dealing with a Commonwealth offence, I have taken into account the s 16A matters rather than the s 3A matters. Whilst I am satisfied that the offender's risk of reoffending would be better addressed by serving a sentence as an Intensive Correction Order, I consider that only a full‑time custodial sentence can address the need for punishment, denunciation, and fulfil the very strong need for general deterrence.”

The applicant sought leave to appeal against his sentence on the following three grounds:


Ground 1: In determining whether to impose an intensive correction order her Honour did not consider the provisions of s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW).

Ground 2: In determining whether to impose an intensive correction order her Honour did not take into account community safety as the paramount consideration.


Ground 3: The sentence was manifestly excessive.


The court (Kirk JA, Rothman and N Adams JJ) upheld ground 1 and re-sentenced the applicant. N Adams J would have also upheld ground 2, but Kirk JA and Rothman J did not consider it necessary to determine that ground.


The court held:


In respect of ground 1


(1) Section 20AB of the Crimes Act 1914 (Cth) picks up the power to impose an ICO for federal offences and the procedural steps governing the operation of the State provision: [2]-[6] per Kirk JA; [96] per N Adams J (Rothman J agreeing at [11]).

Mourtada v The Queen (2021) 290 A Crim R 514; [2021] NSWCCA 21 at [20] and [35]; Homewood v R [2023] NSWCCA 159 at [4].


(2) There is a three-step approach to considering whether to impose an ICO: first, the court must be satisfied that no penalty other than imprisonment is appropriate; then if so, it must determine the length of the sentence; and finally, if the sentence imposed is less than two years for a single offence or three years for an aggregate sentence, the court must consider whether an ICO should be imposed: [79] per N Adams J (Kirk JA agreeing at [1]; Rothman J agreeing at [11]).

Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3 at [59].


(3) The sentencing judge was required to have regard to s 16A of the Crimes Act for the purposes of the first two steps, but then have regard to the purposes of sentencing in s 3A of the Crimes (Sentencing Procedure Act) 1999 (NSW) when considering whether to impose an ICO: [6]-[7] per Kirk JA; [101] per N Adams J (Rothman J agreeing at [11]). Her Honour made a material error in considering the s 16A factors instead of the s 3A factors at this third step: [9] per Kirk JA; [19] per Rothman J; [101], [103]-[104], [108]-[109] and [115]-[116] per N Adams J.

Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3, Benn v R [2023] NSWCCA 24 at [82], Kentwell v The Queen (2014) 252 CLR 601; [2014] HCA 37 at [42], Newman (a pseudonym) v R [2019] NSWCCA 157 at [11], Ibbotson (a pseudonym) v R [2020] NSWCCA 92 at [145].


In respect of ground 2


(4) Section 66(1) of the Sentencing Act requires the court to treat community safety as the ‘paramount consideration’ in deciding whether to impose an ICO: [80]-[81] per N Adams J. While the assessment of community safety required by s 66(2) is not determinative, community safety will usually have a decisive effect on the decision to make, or refuse to make, an ICO, unless the relevant evidence is inconclusive: [129] per N Adams J.

Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3 at [75]- [76].

(5) “Community safety” principally concerns the possible harms, including non-violent harms, to the community that might occur in the future from the risk of reoffending by the offender: [146] per N Adams J.

Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3 at [72].

(6) The sentencing judge made a positive finding about community safety in s 66(2), however her Honour failed to state that she was giving it paramount consideration or to disclose why she was satisfied that other sentencing principles were more important: [147] per N Adams J. This leaves open the inference that she did not have regard to it in the manner required by s 66(1): [148] per N Adams J.


On re-sentence


(7) The ICO cannot be backdated per s 71 of the Crimes (Sentencing Procedure) Act. The term of the ICO can be adjusted by deducting a period equivalent to the term of the pre-sentence custody: [161] per N Adams J (Kirk JA agreeing at [10]; Rothman J agreeing at [14]).

Mandranis v R (2021) 289 A Crim R 260; [2021] NSWCCA 97 at [61].

(8) The applicant is sentenced to an aggregate sentence of 8 months and 17 days imprisonment to be served by way of an ICO subject to the standard conditions: [166] per N Adams J (Kirk JA agreeing at [10]). Exceptional circumstances are found: [164] N Adams J (Kirk JA agreeing at [10]; Rothman J agreeing at [14]).


JUDGMENT


1. KIRK JA: The circumstances of this application for leave to appeal on sentence are set out in the judgment of N Adams J. I agree with the orders proposed by her Honour. I also agree with her Honour’s reasons as to ground 1, subject to what follows.


2. Sentencing for federal offences such as those at issue here is governed by Pt 1B of the Crimes Act 1914 (Cth). That Part does not create its own regime for intensive corrections orders (ICOs). However, s 20AB, which is headed “[a]dditional sentencing alternatives”, provides that in identified circumstances a court may make an ICO where, amongst other things, “under the law of the State or Territory, a court is empowered to pass such a sentence, or make such an order, in respect of a State or Territory offender in corresponding cases” (quoting s 20AB(1)(b)). The term “corresponding cases” was not the subject of submissions in this case and there was no dispute that the section meant that an ICO was an available sentencing option here.


3. Section 20AB(3) provides as follows:

Where a sentence or order referred to in subsection (1) is passed or made under that subsection in respect of a person convicted in a State or Territory of a federal offence, the provisions of the laws of the State or Territory with respect to such a sentence or order that is passed or made under those laws shall, so far as those provisions are capable of application and are not inconsistent with the laws of the Commonwealth, apply, by virtue of this subsection, to and in relation to the sentence or order passed or made under subsection (1).


4. The notion that the State or Territory provisions are to apply “so far as those provisions are capable of application and are not inconsistent with the laws of the Commonwealth” echoes similar notions in ss 68(1) and 79(2) of the Judiciary Act 1903 (Cth). This type of federal provision picks up the State provisions and applies them as federal law to the identified extent: note Rizeq v Western Australia (2017) 262 CLR 1; [2017] HCA 23 at [81] (addressing s 79(2)). Importantly, it does so without altering the essential meaning of the State provision: ibid; Attorney-General (Cth) v Huynh (2023) 97 ALJR 298; [2023] HCA 13 at [57], [151], [237], [269] (addressing s 68(1)).


5. That being said, because a provision from one polity is picked up and applied under the laws of another, the adoption of that law “must proceed by analogy”: Williams v The King [No 2] [1934] HCA 19; (1934) 50 CLR 551 at 561, [1934] HCA 19; Huynh at [59]-[64], [152], [269]. Thus, for example, where a State provision gave a right to appeal to the Attorney-General – referring to the State Attorney – when this was picked up by s 68(2) as regards a federal offence it was read as giving such a right of appeal to the Commonwealth Attorney: ibid. In other words, the provision picked up may require some degree of translation to operate in the federal sphere, although if the “degree of translation required is too great” then it cannot be picked up: Huynh at [152].


6. Here, the State law provides that when deciding whether to make an ICO “the sentencing court must also consider the provisions of section 3A (Purposes of sentencing) and any relevant common law sentencing principles, and may consider any other matters that the court thinks relevant”: Crimes (Sentencing Procedure) Act 1999 (NSW) (Sentencing Act), s 66(3). The sentencing judge considered that “because I am dealing with a Commonwealth offence, I have taken into account the s 16A matters [under the federal Crimes Act] rather than the s 3A matters”. Although that conclusion was understandable, it was in error.


7. Section 66(3) is clear in requiring the sentencing court to take into account s 3A of the State Sentencing Act. To read that as referring instead to s 16A of the federal Act is to rewrite the section and change its meaning. It is not an act of translation. No translation is required; there is no practical or legal obstacle in the way of the sentencing judge considering the matters identified in s 3A of the State law when deciding whether to impose an ICO for the federal offence. Doing so is simply an aspect of applying the State ICO scheme as picked up by s 20AB of the federal law. True, this does involve overlap with matters that will have already been considered when applying s 16A of the federal Act earlier in the sentencing process. That overlap reflects the fact that consideration of whether to impose an ICO is a distinct stage of sentencing, occurring after the sentencing court has determined that a term of imprisonment for a particular term is appropriate: Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3 at [59].


8. Although the sentencing judge misdirected herself in this respect, of itself that does not suffice to establish error sufficient to uphold the appeal. The issue then is whether, as the applicant contends, her Honour did not in fact consider material aspects of the provisions of s 3A of the Sentencing Act when deciding whether to impose an ICO. If she had done so, it would not matter that she undertaken this task by reference to an incorrect label – just as, analogously, a decision-maker may validly act under one power even though they incorrectly believe they are acting under another: Australian Education Union v Department of Education and Children's Services (2012) 248 CLR 1; [2012] HCA 3 at [34].


9. Relevantly here, as the Crown correctly accepted, there is a material difference between the notion of sentencing “to promote the rehabilitation of the offender” (as required by s 3A(d) of the Sentencing Act) and considering “the prospect of rehabilitation of the person” (as referred to in s 16A(2)(n) of the Crimes Act). The latter involves consideration of the likelihood or otherwise of the person in fact being rehabilitated; the former involves a normative conception of active promotion of seeking to achieve that end. That normative conception is significant in the context of deciding whether or not to impose an ICO rather than requiring the convicted person to serve time in a correctional centre. A fair reading of the reasons of the sentencing judge indicates that this consideration was not taken into account at this distinct stage, even though the point had been raised in terms on behalf of the applicant. That suffices to establish ground1.


10. As ground 1 is made out it is necessary to resentence the applicant. It is unnecessary to address ground 2 and I prefer not to do so. The sentence suggested by N Adams J is appropriate, for the reasons her Honour gives.


11. ROTHMAN J: I have had the advantage of reading, in draft, the reasons for judgment of each of N Adams J and Kirk JA. I too agree with the orders proposed by N Adams J and generally with her Honour’s reasons. I am most grateful for her Honour’s analysis of the facts, submissions and grounds, which analysis I adopt.


12. Further, I agree generally with the additional comments of Kirk JA. I wish to make a few further comments of my own.


13. An appropriate reading of her Honour Judge Bright’s remarks on sentence reveals her Honour’s significant experience in the criminal law. The remarks are well-crafted and deal with the issues before the court below. The complaint is that her Honour dealt with the purposes of sentencing prescribed by s 16A of the Crimes Act 1914 (Cth) (“hereinafter “the Commonwealth Act”), when evaluating whether to impose an Intensive Corrections Order (hereinafter “ICO”). This issue is not as clear as the appellant submitted.


14. The purposes of sentencing prescribed by s 16A of the Commonwealth Act do not prescribe denunciation. Yet, her Honour took into account denunciation as a, if not the, major aspect of the evaluation not to impose an ICO.


15. If, as submitted by the applicant, her Honour were applying the purposes prescribed by s 16A (and her Honour were correct in doing so), then her Honour, in taking into account denunciation, would have been taking into account an irrelevant consideration. In other words, the consideration of denunciation as a factor relating to the purposes of sentencing in evaluating whether an ICO is appropriate not only implies that s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW) (hereinafter “the NSW Act”) was being applied, but is inconsistent with an application of s 16A of the Commonwealth Act. Of course, denunciation is a factor in sentencing and one of the purposes of sentencing under the common law.


16. Remarks on sentence should not be “construed minutely and finely with an eye keenly tuned to the perception of error”.[1] Nor should the Court be concerned with “looseness of language” nor “unhappy phrasing”.[2] Such an approach is even more warranted where, as here, the remarks are provided ex tempore.


17. The passage to which my learned colleagues have referred and upon which the applicant relies is a passage that has significant ambiguity. The reference to s 16A of the Commonwealth Act is a reference, on one view, to that which the learned sentencing judge had done previously in the remarks. Nevertheless, it can be read, on another view, as a reference to the task then to be undertaken by the learned sentencing judge. The learned sentencing judge’s reference expressly to denunciation allows, in my view, for the ambiguity to be clarified, at least in part. However, the degree of ambiguity creates difficulty.


18. An accused is entitled to be satisfied that the sentence imposed, if any, is imposed in accordance with law. To the extent that an ambiguity of such moment reasonably arises, it is necessary for the Court to deal with it. As a consequence, I agree with the orders proposed and, generally, subject to these comments, with the reasons of Kirk JA and N Adams J.


19. Two other aspects need comment. First, it is not only the express reference to s 16A of the Commonwealth Act which is problematic. The learned sentencing judge also failed, perhaps because attention was paid to the Commonwealth Act instead of the NSW Act, to consider the “promotion” of rehabilitation. The difference in wording as to rehabilitation between the Commonwealth Act and the NSW Act alters the focus in considering rehabilitation and a failure to consider it, whether or not it is ultimately considered by the sentencing judge to be material, is an error.


20. The second matter of comment is the issue of community safety. As the High Court has made clear and as has been stated by this Court on previous occasions, community safety may be better served by the imposition of a non-custodial sentence. However, I do not accept that “community safety” is the same as “harm to the community”. Nor is it necessarily identical to rehabilitation.


21. A non-full-time custodial sentence may be significantly better for an offender’s rehabilitation but still pose an unacceptable risk to community safety. While there will be times with violent offenders that community safety will be better served by a non-full-time custodial sentence, more often the risk to community safety will be a negative consideration in imposing an ICO.


22. Further, there may be harm to the community, which is not physical and/or does not involve individual victims. Community safety does not require an individual victim, but it does usually refer to a risk of physical or psychological well-being.


23. Thus, the risk to the community of the commission of a financial offence may, in many circumstances, not amount to a risk to “community safety”. On the other hand, the commercial production and distribution of drugs, even where no individual victim can be identified, may amount to significant risk to community safety, and community safety is almost always a risk where an offence is violent.


24. None of the foregoing comments detract from the agreement with the orders proposed by Adams J and the upholding of the appeal on the basis of Ground 1. In those circumstances, it is unnecessary to deal with the submissions of the applicant on Grounds 2 and 3. Further, I agree fully with the remarks of N Adams J on the re-sentencing discretion.


25. N ADAMS J: The applicant, Mr Felix Chan, seeks leave under s 5(1)(c) of the Criminal Appeal Act 1912 (NSW) to appeal against the aggregate sentence of 2 years imprisonment imposed on him in the Queanbeyan District Court by Judge Bright on 10 November 2022 for three offences under s 103(5)(g) of the National Health Act 1953 (Cth). Her Honour ordered that the applicant be released on a Recognizance Release Order (RRO) under s 20(1)(b) of the Crimes Act 1914 (Cth) after serving 14 months of his sentence, being 9 January 2024.


26. An offence contrary to s 103(5)(g) of the National Health Act carries a maximum penalty of 2 years imprisonment (and/or a fine of 50 penalty units). Section 103(5)(g) is in these terms:

(5) A person shall not:

(g) by means of impersonation, a false or misleading statement or a fraudulent device, obtain, or by any of those means aid or abet another person to obtain, a pharmaceutical benefit or a payment in respect of the supply of a pharmaceutical benefit


27. The applicant was a registered pharmacist at the time of committing the offences and owned three pharmacies in and around Canberra. The offending conduct involved the applicant making false claims on the Pharmaceutical Benefits Scheme (PBS) for prescriptions he had not dispensed. 105 false claims were made over time but the acts were “rolled up” into three counts; one count each for the false claims made in relation to each of his three pharmacies. The total amount obtained was $288.595.56.


28. At the proceedings on sentence, it was submitted on the applicant’s behalf that the appropriate sentence was a Community Correction order (CCO) under s 8 of the Crimes (Sentencing Procedure) Act 1999 (NSW) (the Sentencing Act), or, in the event that the court was satisfied that a term of imprisonment was warranted, an Intensive Correction Order (ICO) under s 7 of the Sentencing Act. In ex tempore reasons delivered on the same day, her Honour was satisfied that a term of imprisonment was warranted and she did not impose an ICO.


29. The applicant seeks leave to appeal on the following three grounds:


Ground 1: In determining whether to impose an intensive correction order her Honour did not consider the provisions of s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW).

Ground 2: In determining whether to impose an intensive correction order her Honour did not take into account community safety as the paramount consideration.


Ground 3: The sentence was manifestly excessive.


Factual background


30. Agreed facts were tendered on sentence.


31. The applicant submitted the 105 fraudulent claims between 31 January 2018 and 27 July 2020. He falsely stated that various medical practitioners had supplied 1,070 pharmaceuticals to patients when they had not. The names of real doctors and patients were used.


32. By way of background, each time a pharmacist dispenses a medication, they enter it into their prescription dispensing software. At the end of the month, they certify that all the details entered into the software are correct and send a claim to Services Australia for payment. Once Services Australia has received the prescription details, the PBS assessing engine indicates whether the medication supplied can or cannot be claimed.


33. At the end of a claim period, which is up to 35 days from the date of supply, the approved supplier is required to close the claim period through their prescription dispensing software and send through the closed claims transactions to Services Australia. When closing a claim, the approved supplier must certify that each pharmaceutical benefit claimed is in accordance with the legislation and the information is correct. The software warns the approved supplier that giving false or misleading information is a serious offence, and they must sign to certify the correctness of the claim before submission.


Ginninderra Pharmacy


34. The applicant was the sole trader of Ginninderra Pharmacy. From 1 October 2009 to at least 24 November 2020, he was the only approved person for the supply of pharmaceutical benefits at that pharmacy. He lodged or caused to be lodged 30 fraudulent PBS claims containing false statements in relation to 466 items that were not supplied. The claims were submitted for payment, causing $111,229.32 to be paid into a Bankwest bank account in the name of “Felix Yue-Sing Chan TAS Ginninderra Pharmacy”.


Priceline Pharmacy Queanbeyan


35. The applicant was the sole trader of Abundant QBN Pty Ltd which was the only “approved person” for the supply of pharmaceutical benefits from Priceline Pharmacy Queanbeyan. The applicant on 46 occasions lodged or caused to be lodged fraudulent PBS claims containing false statements in relation to 380 items that were not supplied. The claims were submitted for payment, causing $114,553.21 to be paid into a National Australia Bank (“NAB”) bank account in the name of “Abundant QBN Pty Ltd”.


Priceline Pharmacy Bungendore


36. The applicant was the sole trader of Abundant Health Care Pty Ltd which was the only “approved person” for the supply of pharmaceutical benefits from Priceline Pharmacy Bungendore. As the sole trader, the applicant on 29 occasions lodged or caused to be lodged fraudulent PBS claims containing false statements in relation to 224 items that were not supplied. The claims were submitted for payment, causing $62,813.03 to be paid into a NAB bank account in the name of “Abundant Health Care Pty Ltd”.


The investigation


37. In 2020, an investigation was commenced into the applicant’s claims on the PBS. It emerged that doctors whose unique prescriber details had been used by the applicant to make a claim under the PBS had not in fact written scripts for some of the medication that the applicant said he had dispensed.


38. On 2 November 2020, the applicant was invited to attend a voluntary interview in relation to the allegations. The interview took place on 24 November 2020. During the interview, the applicant provided considerable assistance to investigating officials and admitted that he was the controlling mind of both companies that are the approved pharmacists for the Queanbeyan and Bungendore pharmacies. He admitted to claiming payments from the PBS without supplying the corresponding pharmaceutical benefits and made further voluntary admissions to additional false claims that the Department of Health (“the Department”) had not otherwise been aware of.


39. The applicant made voluntary admissions as to 60% of the total amount charged broken up as follows: $88,174.85 of the $111,229.32 claims in respect of the Ginninderra Pharmacy; $65,336.20 of the $114,553.21 in respect of Priceline Pharmacy Queanbeyan; and $24,444.89 of the $62,813.03 claims in respect of Priceline Pharmacy Bungendore.


40. The applicant told investigators that financial difficulties and stresses concerning his three pharmacies were the primary reasons he “took matters into his own hands”. Specifically, he said that the 2020 bushfires nearly threatened Priceline Pharmacy Bungendore, both Ginninderra Pharmacy and Priceline Pharmacy Queanbeyan were suffering financially before the COVID-19 pandemic, increased competition from large competitors around Ginninderra Pharmacy had caused financial suffering, and Priceline Pharmacy Queanbeyan had declined in market value to the tune of $1 million whereby NAB (his bankers) threatened to recall the business loan. Despite this, the applicant acknowledged that “[t]here is absolutely no excuse for any wrongdoing, no matter what circumstances are and how tough things are”.


41. During the interview, the applicant indicated he was “hundred per cent committed to willingly provide the department with a genuine account of a full list of known non-supplied items by [him]”. He also said he was willing to pay back the Department for all PBS transactions determined to be non-supplied dispensed items.


42. The applicant provided bundles of documents identifying medications for which he had claimed payment without supplying the corresponding items after the interview and again on 3 December 2020.


43. On 23 December 2020, the Department provided the applicant with a schedule of all concerned supplies. The applicant returned the schedule on 8 January 2021, after inspecting all 58 pages and manually annotating whether the transactions were genuine or that he would not be contesting that the transaction was a non-supply or “dummy” transaction.


44. On 21 January 2021, the applicant repaid the entire amount of PBS payments received to which neither he nor his companies were entitled.

Proceedings on sentence


45. Proceedings on sentence were conducted on 10 November 2020.


46. A Crown bundle was tendered compromising of the Court Attendance Notices, a Notice of Committal, an Agreed Statement of Facts, a Sentencing Assessment Report, Crown written submissions on sentence, a comparative sentencing schedule, and copies of comparative cases. The sentencing judge indicated she had already read material before court.


47. The applicant did not give evidence during sentence proceedings. Counsel for the applicant tendered a bundle comprising of a report by psychologist Patrick Sheehan dated 26 October 2022; references from customers and friends Yunhong Du, Mourad Karas, Kate McAllister, Greg Roberts, Frank Shugg and Beverley Clark; and a letter from Aulich Criminal Law to the Health Care Complaints Commission dated 27 September 2022.


Sentencing submissions


48. The Crown relied on written submissions supplemented by further oral submissions. The Crown’s position was that full-time imprisonment was the only appropriate sentence in all the circumstances.


49. The applicant relied on the following favourable subjective factors: he had voluntarily ceased offending; he made prompt and comprehensive admissions and provided substantial assistance to investigators; he repaid the amount of the false claims in full; and he is a person of good character with a history of positive community engagement. It was submitted that the 2-year maximum prescribed penalty was an important yardstick and that the current offending could not be considered worst case. It was accepted that the offences are serious and that general deterrence is an important sentencing factor, but it was submitted that having regard to the applicant’s compelling subjective case, the court would not be satisfied that no penalty other than imprisonment is appropriate and instead would sentence the applicant to a RRO or a CCO. In the alternative, counsel for the applicant submitted that the court could impose an ICO.


50. Written submissions on sentence were also provided, which included the following submission:

“In the event the Court is considering an ICO, having regard to these matters it appears likely that rehabilitation and, therefore, community safety as it is used in s 66 of the CSP ACT, is best achieved by positive behavioural change which, for Mr Chan, is more likely to occur with supervision and access to treatment programs in the community (see R v Pullen [2018] NSWCCA 264 at [84]).”


Remarks on sentence


51. After setting out the agreed facts as summarised above, the sentencing judge observed the following:

“Those facts clearly disclose serious objective criminality. The offender was engaged in a very lengthy course of conduct and made claims on 105 separate occasions involving 1,070 items to obtain total payments of $288,595.56. This amount was government funds to which the offender was not entitled. The false statements made included the offender using the prescribed numbers of real doctors and the real names of patients. As observed by his Honour Judge Davidson in The Queen v Gorgy (NSWDC 17 April 1998, unreported), it is highly relevant to the sentencing exercise that an approved pharmacist under the Pharmaceutical Benefits Scheme is in a position analogous to a position of trust. His Honour observed as follows at 8:

‘if schemes in the public interest such as these are to be successfully administered for the benefit of the community as a whole, the Commonwealth must of necessity place its trust in the person who are likely to benefit commercially from them.’

His Honour further observed as follows at 8:

‘schemes of this sort are so detailed in the way that they are administered and involve so many instances of claims and payments for claims that it is quite impossible to institute a completely secure system for their oversight.’

In such circumstances, the Commonwealth relies heavily upon the integrity of those making claims under the system. General deterrence is a very important consideration on sentences. Sentences must be imposed to deter like‑minded members of the community from offending in this way.”

(Emphasis added.)


52. Her Honour went on to consider the subjective material tendered on the applicant’s behalf. The applicant was born in Hong Kong. He moved to Brisbane when he was 11 years of age. He reported a conventional but strict childhood and his parents had high expectations for him. He completed his Higher School Certificate and then a Bachelor of Pharmacy at James Cook University in Townsville in 2003. He became a fully registered pharmacist in 2004. He managed pharmacies in Lismore and Sydney until 2009 when he purchased his own pharmacy in the ACT.


53. The applicant suffers long-term asthma and psoriasis for which he is prescribed medication. His skin condition fluctuates in accordance with stress. He reported weight loss over the past 18 months.


54. The applicant reported to Mr Sheehan that he felt his parents' validation was contingent on his performance, which has undermined the closeness in their relationship. He found migrating to Australia difficult and he said he internalised the bullying from his schooling. He reported a lengthy history of low emotional expression and internalisation of distress, habits learnt in childhood. He felt anxious and fearful for the operation of his business, and professional failure during the period 2018 to 2020. He reported no previous history of illicit substance use or problems with alcohol.


55. Her Honour then went on to consider the circumstances of the offending behaviour. She accepted that in 2015 and 2016, the applicant was under stress because he had obtained loans over $4 million to acquire pharmacies and the businesses were not performing as expected. He was experiencing financial difficulties and pressures. He felt a sense of grievance against several sources; the person who had sold him the pharmacy (they had not been transparent about profitability of the business); the shopping centre management for making decisions that reduced foot traffic in the centre; and Medicare for not providing assistance against large, aggressive corporate companies who sought to out-trade smaller businesses. Her Honour extracted Mr Sheehan’s observation that:

"It was through this sense of grievance that he felt some sort of entitlement to artificially inflate his business performance by making false claims."


56. Her Honour then considered the applicant’s attitude to the offending noting that he had expressed insight and remorse for the offending, telling Mr Sheehan:

"It was against the law, it breaks the trust of a lot of people, such as taxpayers and the GPs I named. It was dishonest. I've let my family down."


57. In that context, her Honour noted the applicant’s fear that his business would be jeopardised, and his family would experience financial difficulties if he received a custodial sentence. He reported his wife is disappointed in his offending, however, remains supportive. He married his wife when he was 27 years of age and they have a 12-year-old son.


58. Her Honour noted that Mr Sheehan’s opinion was that the offences are aberrant in the scheme of the offender's broader life but not impulsive, given the length of the period of offending. She noted his opinion that:

"He tends to hide any emotions of vulnerability and not seek support, quietly attempting to resolve problems alone. His emotional strain tends to surface through somantic (sic) symptoms such as poor sleep, teeth grinding, weight loss and escalation of his condition. His difficulties in acknowledging emotional distress were evident during the interview."


59. Mr Sheehan stated that he could not “offer any psychiatric diagnosis made on Mr Chan's symptoms' description, but it is clear that his method of suppressing internal distress is not effective as a long-term strategy”.


60. Mr Sheehan opined that the offender had expressed genuine remorse and humility in relation to the offending, and he assessed the offender as being at the very low range in terms of risk of reoffending. He did not consider that the applicant's experience of custody would be more onerous relative to other inmates, however, he did consider there was little to be achieved by a custodial term in terms of his rehabilitation.


61. As for treatment recommendations, her Honour noted that Mr Sheehan was of the opinion that there was no clear rehabilitation needs for the applicant. He does not display any of the characteristics associated with recidivism, although he would benefit from focusing on developing more emotional transparency in his key relationships.


62. The Sentencing Assessment Report noted the applicant’s explanation that he took the "easy" option without considering the consequences. He has insight into the offending, was able to identify that his offending had a negative impact on his family and the wider community and that it affects taxpayers. He expressed regret.


63. Her Honour then noted the submissions of the parties (outlined above) and went on to consider the sentencing regime for Commonwealth offences in Pt 1B of the Crimes Act 1914: under s 16A(1) the court must impose a sentence that is of a severity appropriate in all the circumstances of the offence and under s 16A(2) the court must take into account the non-exhaustive list of matters when sentencing a federal offender. The court may only impose a sentence of imprisonment if it is satisfied that imprisonment is the only appropriate sentence: s 17A.


64. Under the heading “Consideration of s 16A(2) factors - the Nature and circumstances of the offence”, her Honour stated that in determining the appropriate sentence she had taken into account the following matters concerning the nature and circumstances of the offending as follows:

“1. The offending occurred over a period of two and a half years between 31 January 2018 and 27 July 2020. False claims were made on 105 separate occasions relating to 1,070 pharmaceutical items. On each occasion that a claim was made, the offender entered the information into the prescription dispensing software before submitting a claim to Services Australia. The software warned the offender on each occasion that giving false or misleading information is a serious offence. I am satisfied that the offender knowingly made the false statements on each occasion. Each offence represents a course of conduct relating to each of the three pharmacies. I note that each false claim individually could have been subject to a separate charge under the relevant offence provision.

2. In preparing each false claim, the offender utilised the real information of both doctors and patients. He was claiming for medication that had not been prescribed by the relevant medical practitioner, nor provided to the relevant patient.


3. The total amount claimed with respect to each offence is $111,229.32, $114,553.21 and $62,813.03. The full amount of the loss has been repaid by the offender.


4. The motivation for the offending was financial stressors that the offender was experiencing at the time.”


65. Having regard to those factors, her Honour assessed the objective seriousness for each offence as “well above the middle of the range”, except for the objective seriousness of count 3 which was reduced but still above the mid-range as it involved less funds.


66. Her Honour then noted that the repayment of the amounts obtained was “significant demonstration of his contrition” and that she would allow a discount of 25% for the early pleas. He had assisted the authorities such that 60% of the amount charged was based upon his disclosure and admissions. She was satisfied that he was remorseful, of previous good character, had good prospects of rehabilitation, was a low risk of reoffending and unlikely to reoffend.


67. Her Honour then turned to consider whether any penalty other than imprisonment was appropriate under s 17A of the Crimes Act concluding the following:

“I am satisfied that no penalty other than imprisonment is appropriate, having regard to the objective seriousness of the offending. Specifically, the amount of funds involved and the manner in which the claims were orchestrated, and also the very strong need for general deterrence. I am of this view notwithstanding the offender's strong subjective case. Having determined that a custodial sentence is appropriate, I am required to determine the length of each sentence before considering the question of the appropriateness of the sentence being served by way of an Intensive Correction Order.

I propose to impose an aggregate sentence pursuant to s 53A(1), Crimes (Sentencing Procedure) Act. In determining the appropriate sentence, I have had regard to the maximum prescribed penalty. I have taken into account the objective seriousness of the offence, the offender's subjective circumstances, and the plea of guilty. Pursuant to s 53A(2)(b), the sentences that would have been imposed for each offence had separate sentences been imposed instead of an aggregate sentence are as follows.


In relation to counts 1 and 2, I am satisfied that the appropriate starting term for the sentence is one year and four months. That starting term will be reduced by 25% for the plea of guilty, leaving a total sentence on one year.


In relation to count 3, I am satisfied that the appropriate starting term is 12 months. I have reduced that starting term by 25% for the plea of guilty, leaving a total sentence of nine months.”


68. Her Honour had regard to the totality principle and was satisfied that there should be some accumulation. Her Honour then turned to consider whether the sentence should be served by way of an ICO and stated:

“In determining whether an Intensive Correction Order is appropriate, I have considered s 66, Crimes (Sentencing Procedure) Act. Section 66 provides as follows:

‘(1) Community safety must be the paramount consideration when the sentencing court is deciding whether to make an intensive correction order in relation to an offender.


(2) When considering community safety, the sentencing court is to assess whether making the order of serving a sentence by way of full-time detention is more likely to address the offender's risk of reoffending.


(3) When deciding whether to make an intensive correction order, the sentencing court must also consider the provisions of section 3A (Purposes of sentencing) and any relevant common law sentencing principles, and may consider any other matters that the Court thinks relevant’.”


69. Her Honour immediately provided the following reasons for declining to impose an ICO. It is this passage of her Honour’s reasons which was the focus of grounds 1 and 2:

“I note that because I am dealing with a Commonwealth offence, I have taken into account the s 16A matters rather than the s 3A matters. Whilst I am satisfied that the offender's risk of reoffending would be better addressed by serving a sentence as an Intensive Correction Order, I consider that only a full‑time custodial sentence can address the need for punishment, denunciation, and fulfil the very strong need for general deterrence.”


70. Her Honour went on to impose the aggregate sentence of 2 years imprisonment. The indicative sentences were as follows:

(1) Seq. 2: 1 year imprisonment

(2) Seq. 3: 1 year imprisonment

(3) Seq. 4: 9 months imprisonment


Intensive Correction Orders


71. Grounds 1 and 2 concern the sentencing judge’s consideration of s 66 of the Sentencing Act. Before turning to consider the submissions, it is helpful to first set out the statutory regime for ICOs and the principles derived from the relevant decisions. Although the option to impose an ICO on a person sentenced to a period of imprisonment has been available since 2010, it has only been since 2018 that in doing so “community safety” is the paramount consideration.


72. The power to make an ICO is contained in s 7 of the Sentencing Act, which relevantly provides:

7 Intensive correction orders

(1) A court that has sentenced an offender to imprisonment in respect of 1 or more offences may make an intensive correction order directing that the sentence or sentences be served by way of intensive correction in the community.


(2) If the court makes an intensive correction order directing that a sentence of imprisonment be served by way of intensive correction in the community, the court is not to set a non-parole period for the sentence.


(3) This section does not apply to an offender who is under the age of 18 years.


(4) This section is subject to the provisions of Part 5.


Note—


Among other matters, Part 5 provides that a single offence cannot be the subject of an intensive correction order if the imprisonment imposed exceeds 2 years, and that multiple offences cannot be the subject of an intensive correction order or orders if the imprisonment imposed exceeds 3 years.


73. The determination of this ground turns on the requirements of s 66 (in Pt 5, Div 2 comprising ss 66-69) which is headed “Community safety and other considerations”. Section 66 was amended by the Crimes (Sentencing Procedure) Amendment (Sentencing Options) Act 2017 (NSW), which took effect from 24 September 2018 and is in these terms:

(1) Community safety must be the paramount consideration when the sentencing court is deciding whether to make an intensive correction order in relation to an offender.

(2) When considering community safety, the sentencing court is to assess whether making the order or serving the sentence by way of full-time detention is more likely to address the offender’s risk of reoffending.


(3) When deciding whether to make an intensive correction order, the sentencing court must also consider the provisions of section 3A (Purposes of sentencing) and any relevant common law sentencing principles, and may consider any other matters that the court thinks relevant.


74. Section 68 provides that an ICO can be imposed where the sentence of imprisonment in respect of a single offence does not exceed 2 years and the aggregate sentence of imprisonment does not exceed 3 years. The applicant received an aggregate sentence of 2 years and was, thus, eligible for consideration of an ICO.


75. Section 66(3) provides that it is mandatory to have regard to s 3A when deciding whether to impose an ICO. Section 3A of the Sentencing Act (referred to in s 66(3)) is in these terms:

3A Purposes of sentencing

The purposes for which a court may impose a sentence on an offender are as follows—


(a) to ensure that the offender is adequately punished for the offence,


(b) to prevent crime by deterring the offender and other persons from committing similar offences,


(c) to protect the community from the offender,


(d) to promote the rehabilitation of the offender,


(e) to make the offender accountable for his or her actions,


(f) to denounce the conduct of the offender,


(g) to recognise the harm done to the victim of the crime and the community.


76. The ICO regime, and s 66 in particular, had been considered by this Court on a number of occasions by the time the applicant came for sentence in this matter: R v Pullen (2018) 275 A Crim R 509; [2018] NSWCCA 264; Fangaloka v R [2019] NSWCCA 173 (“Fangaloka”); Casella v R [2019] NSWCCA 201, Mandranis v R (2021) 289 A Crim R 260; [2021] NSWCCA 97 (“Mandranis”) and Mourtada v The Queen (2021) 290 A Crim R 514; [2021] NSWCCA 211 (“Mourtada”). Despite this, s 66 had not been considered by the High Court at the time of the applicant’s sentence.


77. The applicant was sentenced on 10 November 2022. Only five days later, on 15 November 2022, the High Court heard the appeal against the decision in Stanley v Director of Public Prosecutions (NSW) (2021) 107 NSWLR 1; [2021] NSWCA 337 and made orders allowing the appeal that day. Reasons for those orders were published on 15 February 2023: Stanley v Director of Public Prosecutions (NSW) (2023) 97 ALJR 107; [2023] HCA 3 (Stanley). That decision was directed at whether a failure to consider s 66(2) of the Sentencing Act amounted to jurisdictional error such that s 176 of the District Court Act 1973 (NSW) did not preclude judicial review of a decision of the District Court (on a summary matter on appeal from the Local Court). In holding that it did, the majority judgment in Stanley (Gordon, Edelman, Steward and Gleeson JJ) considered the statutory scheme for ICOs under the Sentencing Act.


78. As for the purpose of the 2018 amendments, the majority reasons of Stanley note the following at [84]-[86] (footnotes omitted):

“[84] In 2017, the statutory scheme for ICOs was substantially amended by the Crimes (Sentencing Procedure) Amendment (Sentencing Options) Act 2017 (NSW) (‘the 2017 Act’). In his second reading speech, the New South Wales Attorney-General, Mark Speakman SC, stated that the legislation ‘introduce[d] new, tough and smart community sentencing options that will promote community safety by holding offenders accountable and tackling the causes of offending’. The Attorney-General stated that ‘[w]e know from Australian and international research that community supervision, combined with programs that target the causes of crime reduce offending ... We also know that community supervision is better at reducing reoffending than a short prison sentence ... With the new [ICO], offenders who would otherwise be unsuitable or unable to work will be able to access intensive supervision as an alternative to a short prison sentence’."

[85] In his second reading speech for the 2017 Act, the Attorney‑General also stated:


‘New section 66 of the Crimes (Sentencing Procedure) Act will make community safety the paramount consideration when imposing an intensive correction order on offenders whose conduct would otherwise require them to serve a term of imprisonment. Community safety is not just about incarceration. Imprisonment under two years is commonly not effective at bringing about medium- to long-term behaviour change that reduces reoffending. Evidence shows that community supervision and programs are far more effective at this. That is why new section 66 requires the sentencing court to assess whether imposing an intensive correction order or serving the sentence by way of full-time detention is more likely to address the offender's risk of reoffending.’

[86] These extrinsic materials reinforce what is evident from the terms of s 66: that the conduct of the assessment in s 66(2) is a prescribed and essential aspect of giving ‘paramount consideration’ to community safety, as s 66(1) requires.”


79. The joint reasons in Stanley approved the three-step approach endorsed by this Court when considering whether to impose an ICO at [59]. The combined operation of ss 7 and 66 requires a three-stage process as follows:

(1) First, the court must first be satisfied that, having considered all possible alternatives, no penalty other than imprisonment is appropriate;

(2) Secondly, if a sentence of imprisonment is appropriate, the court must determine the length of the sentence, without regard to how it is to be served; and

(3) Finally, if the sentence imposed is less than two years (and not for an offence for which an ICO is not available (s 67)), the court must then consider whether or not an ICO should be imposed.


80. The majority then went on to observe the following in relation to s 66 of the Sentencing Act and “community safety” at [72]-[77]:

“[72] There was no dispute before this Court that s 66 imposes specific mandatory considerations upon the decision maker to make, or refuse to make, an ICO. Section 66(1) requires the court to treat community safety as the ‘paramount consideration’. In the context of s 66(2), community safety principally concerns the possible harms to the community that might occur in the future from the risk of reoffending by the offender. The issue is not merely the offender's risk of reoffending, but the narrower risk of reoffending in a manner that may adversely affect community safety.

[73] The identification of community safety in s 66(1) as the ‘paramount’ consideration also indicates that s 66 is concerned with an aspect of the sentencing task that requires the sentencing court to have a particular and different focus at the third stage of the three-step process described earlier. When the court is deciding the discrete question whether or not to make an ICO, community safety is the consideration to which other considerations are to be subordinated, although other considerations must or may be taken into account as prescribed by s 66(3).


[74] Section 66(2) explains how the sentencing court must engage with the paramount consideration of community safety. For the purpose of addressing community safety, s 66(2) requires the sentencing court to undertake a task of assessing the possible impacts of an ICO or full-time detention on the offender's risk of reoffending. Section 66(2) gives effect to Parliament's recognition that, in some cases, community safety will be better promoted by a term of imprisonment served in the community than by full-time detention. Section 66(2) is premised upon the view that an offender's risk of reoffending may be different depending upon how their sentence of imprisonment is served, and implicitly rejects any assumption that full-time detention of the offender will most effectively promote community safety. Thus, s 66(2) requires the sentencing court to look forward to the future possible impacts of the sentence of imprisonment, depending upon whether the sentence is served by way of full-time detention or by way of intensive correction in the community.


[75] The assessment required by s 66(2) is not determinative of whether an ICO may or should be made. To the contrary, as is plain from s 66(3), the assessment is required for the purpose of addressing community safety as the paramount, but not the sole, consideration in deciding whether or not to make an ICO. Thus, the power to make an ICO requires an evaluative exercise that treats community safety as the paramount consideration, with the benefit of the assessment mandated by s 66(2). In that respect, the nature and content of the conditions that might be imposed by an ICO will be important in measuring the risk of reoffending.


[76] That said, community safety will usually have a decisive effect on the decision to make, or refuse to make, an ICO, unless the relevant evidence is inconclusive. There may be cases where a court cannot be satisfied whether serving a sentence by way of intensive correction in the community or serving a sentence in full-time custody would be more likely to address reoffending. In those cases, other factors will assume significance and will be determinative. On the other hand, there will be cases where a court concludes that serving the sentence by way of intensive correction in the community is more likely to address reoffending.


[77] While aspects of community safety underpin some of the general purposes of sentencing, such as specific and general deterrence and protection of the community from the offender, those aspects will have been considered in deciding whether to impose a sentence of imprisonment (ie, before considering an ICO). Community safety is required to be considered again and in a different manner under s 66 when considering whether to make an ICO. At this third step, community safety in s 66(1) is given its principal content by s 66(2), namely, the safety of the community from harms that might result if the offender reoffends, whether while serving the term of imprisonment that has been imposed or after serving that term of imprisonment.”


81. The decision in Stanley was subsequently considered by this Court in Zheng v R [2023] NSWCCA 64. Gleeson JA (with whom Hamill and Ierace JJ agreed), extracted the above paragraphs from Stanley and summarised the effect of them as follows at [282]-[286]:

“[282] First, the power to make an ICO requires an evaluative exercise that treats community safety as the paramount consideration, with the benefit of the assessment mandated by s 66(2). The issue is not merely the offender’s risk of reoffending, but the narrower risk of reoffending in a manner that may affect community safety: at [72], [75].

[283] Second, s 66(2) is premised upon the view that an offender's risk of reoffending may be different depending upon how their sentence of imprisonment is served, and implicitly rejects any assumption that full-time detention of the offender will most effectively promote community safety: at [74].


[284] Third, the nature and content of the conditions that might be imposed by an ICO will be important in measuring the risk of reoffending: at [75].


[285] Fourth, the consideration of community safety required by s 66(2) is to be undertaken in a forward-looking manner having regard to the offender’s risk of reoffending: at [74].


[286] Fifth, while community safety is not the sole consideration in the decision to make, or refuse to make, an ICO, it will usually have a decisive effect unless the evidence is inconclusive: at [76].”


Crimes Act 1914 (Cth)


82. The applicant stood for sentence on offences against the Commonwealth and, thus, was to be sentenced in accordance with the provisions of Pt 1B of the Crimes Act. Section 16A of the Crimes Act provides for the matters a court is to have regard to when passing a sentence for federal offences. Section 16A(1) provides that a court must impose a sentence or make an order that is of a severity appropriate in all the circumstances of the offence. Section 16A(2) is in these terms:

(2) In addition to any other matters, the court must take into account such of the following matters as are relevant and known to the court:

(a) the nature and circumstances of the offence;


(b) other offences (if any) that are required or permitted to be taken into account;


(c) if the offence forms part of a course of conduct consisting of a series of criminal acts of the same or a similar character--that course of conduct;


(d) the personal circumstances of any victim of the offence;


(e) any injury, loss or damage resulting from the offence;


(ea) if an individual who is a victim of the offence has suffered harm as a result of the offence—any victim impact statement for the victim;


(f) the degree to which the person has shown contrition for the offence:

(i) by taking action to make reparation for any injury, loss or damage resulting from the offence; or


(ii) in any other manner;

(fa) the extent to which the person has failed to comply with:

(i) any order under subsection 23CD(1) of the Federal Court of Australia Act 1976; or


(ii) any obligation under a law of the Commonwealth; or


(iii) any obligation under a law of the State or Territory applying under subsection 68(1) of the Judiciary Act 1903;


about pre-trial disclosure, or ongoing disclosure, in proceedings relating to the offence;

(g) if the person has pleaded guilty to the charge in respect of the offence:

(i) that fact; and


(ii) the timing of the plea; and


(iii) the degree to which that fact and the timing of the plea resulted in any benefit to the community, or any victim of, or witness to, the offence;

(h) the degree to which the person has cooperated with law enforcement agencies in the investigation of the offence or of other offences;


(j) the deterrent effect that any sentence or order under consideration may have on the person;


(ja) the deterrent effect that any sentence or order under consideration may have on other persons;


(k) the need to ensure that the person is adequately punished for the offence;


(m) the character, antecedents, age, means and physical or mental condition of the person;


(ma) if the person's standing in the community was used by the person to aid in the commission of the offence--that fact as a reason for aggravating the seriousness of the criminal behaviour to which the offence relates;


(n) the prospect of rehabilitation of the person;


(p) the probable effect that any sentence or order under consideration would have on any of the person's family or dependants.


GROUNDS OF APPEAL


Ground 1: In determining whether to impose an intensive correction order her Honour did not consider the provisions of s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW).


Applicant’s submissions


83. The nub of the complaint under this ground is that the sentencing judge failed to consider the purposes of sentencing specified in s 3A of the Sentencing Act despite these being mandatory considerations pursuant to s 66(3) of that Act. Rather, her Honour took into account the considerations in s 16A of the Crimes Act. One of the consequences of this, it was submitted, is that some purposes were elevated without regard to all of the purposes listed in s 3A of the Sentencing Act. Moreover, her Honour did not have regard to the purposes of sentencing not listed in s 16A of the Crimes Act but included in s 3A of the Sentencing Act.


84. The applicant submitted that it would have been apparent that accountability, denunciation and recognition of harm could properly be met in the circumstances of this case by a sentence of imprisonment which did not preclude the making of an ICO and that the protection of the community and promotion of the applicant’s rehabilitation would have been better facilitated by the imposition of an ICO.


85. It was submitted at the hearing of this appeal that the most beneficial interpretation of her Honour’s reference to “the s 16A matters” in the context of her consideration of an ICO is that her Honour at least had regard to those s 16A matters which related to the purposes of sentencing which were analogous to the purposes in s 3A of the Sentencing Act.


86. It was further submitted that her Honour’s reference to s 16A of the Crimes Act (rather than s 3A of the Sentencing Act) had the capacity to impact on the result in this matter and was, thus, a material error. One example of this was the different wording in relation to “rehabilitation” in each Act. A specific submission was put to the sentencing judge on the issue of rehabilitation which was not referred to by the sentencing judge when she was considering whether to impose an ICO. It is submitted that had her Honour had regard to s 3A rather than s 16A, the consideration of rehabilitation would have militated in favour of the granting of an ICO.


Crown submissions


87. The Crown accepted that her Honour should have stated that she was having regard to s 3A rather than s 16A factors but that a number of the matters identified in s 16A(2) of the Crimes Act are comparable to those in s 3A in any event. It was submitted that a fair reading of her Honour’s reasons show that her Honour did in fact have regard to a number of matters referred to in s 3A of the Sentencing Act in the course of her instinctive synthesis. In particular, her Honour had regard to specific deterrence, general deterrence, prospects of rehabilitation and recognition of the harm to the community at various stages throughout her reasons.


88. To the extent that the applicant’s complaint focused upon the words immediately following where the sentencing judge set out s 66 of the Sentencing Act, the Crown placed reliance upon the fact that the reasons were delivered ex tempore. It was submitted that while her Honour could have expressed herself differently, it is open to this Court to comprehend her Honour’s reasons to mean that when conducting the exercise required by s 66(3) of the Sentencing Act her Honour had considered those matters already. It was submitted that her Honour was not intending to convey that she did so to the exclusion of s 3A matters.


89. It was further noted that her Honour’s express reference to the need for denunciation reflects s 3A of the Sentencing Act and is not a factor in s 16A(2) of the Crimes Act. To the extent that the applicant asserts that the sentencing judge failed to indicate which of the s 16A/s 3A matters her Honour had taken into account, reliance was placed upon the decision of Adamson J (as her Honour then was) in Mourtada v the Queen at [37]-[38]. It was submitted that there is no such requirement.


90. Ultimately, it was submitted that the sentencing judge was cognisant of the wording of s 66 (as she extracted it in her reasons) and then went on to expressly mention three of those purposes.


91. It was submitted that the fact that her Honour expressly referred to the need for punishment, denunciation and general deterrence does not mean that she failed to have regard to the other purposes of sentencing. As for the issue of protecting the community, it was submitted that that is a matter closely related to the risk of reoffending. Her Honour expressly found the consequences of the applicant’s offending would deter him from any future offending and that he was unlikely to reoffend. In any event, her Honour addressed the issue of community safety under s 66(2) expressly in her reasons.


Consideration: Ground 1


92. Although the sentencing judge was required to sentence the applicant under the Crimes Act (and to have regard to s 16A in doing so), she was also asked to impose an aggregate sentence on the applicant and to consider the imposition of an ICO, both of which required her Honour to apply NSW law.


93. Her Honour imposed an aggregate sentence under s 53A of the Sentencing Act. That provision was picked up and applied as federal law in relation to the applicant’s sentence only insofar as it was “applicable”: s 68(1) of the Judiciary Act 1903 (Cth). As Beech-Jones J (as his Honour then was), with whom Bathurst CJ and I agreed, observed in Huynh v R (2021) 105 NSWLR 384; [2021] NSWCCA 148 regarding the meaning of the words “so far as they are applicable” in s 68(1) (at [39]):

“In relation to the exercise of powers conferred by State law, although s 68(1) and s 79(1) of the Judiciary Act 1903 contain different phrases concerning what State laws are picked up and applied in that s 68(1) refers to such laws ‘so far as they are applicable’ and s 79 refers to such laws as ‘are applicable’ but ‘except as otherwise provided’, in Putland at [7], it was observed that there exists ‘little, if any, functional difference’ between these two forms of qualification.”


94. The application of s 68(1) of the Judiciary Act was recently considered by the High Court in Attorney-General (Cth) v Huynh (2023) 97 ALJR 298; [2023] HCA 13. As for the similarity between s 68(1) and s 79(1), Kiefel CJ, Gageler and Gleeson JJ observed the following at [41] (footnote omitted):

“Section 68(1)'s application of certain State and Territory laws ‘so far as they are applicable’ to persons charged with offences against Commonwealth laws in respect of whom jurisdiction is invested in State and Territory courts under s 68(2) has features in common with the prescription in s 79(1) of the Judiciary Act that certain State and Territory laws are binding on courts exercising federal jurisdiction ‘except as otherwise provided by the Constitution or the laws of the Commonwealth ... in all cases to which they are applicable’. There is a substantial degree of overlap in the purposes and operations of the two provisions in so far as both ‘enable State [and Territory] courts in the exercise of federal jurisdiction to apply federal laws according to a common procedure in one judicial system’.”

(Although t heir Honours went on at [42] to observe there are important differences between ss 68(1) and 79(1), those differences are not presently relevant).


95. There is no provision for imposing an “aggregate sentence” in the Crimes Act which means that it is not “otherwise provided” for in that Act. As I observed in Waterstone v R [2020] NSWCCA 117 at [123] and Patel v R (2022) 366 FLR 314; [2022] NSWCCA 93 at [83] (“Patel”), the Commonwealth DPP’s position is that a court sentencing a federal offender can impose an aggregate sentence (under the Sentencing Act) for federal offences: Putland v The Queen (2014) 218 CLR 174; [2014] HCA 8; Director of Public Prosecutions (Cth) v Beattie (2017) 270 A Crim R 556; [2017] NSWCCA 301. Although I expressed some doubt about that in Patel at [85], no issue was raised in that regard on this appeal, and this appeal proceeded on the basis that such a course was open to her Honour.


96. Similarly, the provisions of the Sentencing Act concerned with ICOs, including ss 7 and 66, could only operate in relation to the applicant insofar as federal law picked them up and applied them. Section 20AB of the Crimes Act provides for “additional sentencing alternatives” and s 20AB(1AA)(a)(ix) expressly provides for “an intensive correction order”. There is no other facilitative provision in the Crimes Act analogous to s 66 of the Sentencing Act but, as Basten JA observed in Mourtada at [20] in picking up the power under State law to impose an ICO, s 20AB also picks up the procedural steps governing the operation of the State provision. In the same case, Adamson J said this at [35]:

“I would prefer not to express a view as to the wider topic of the extent to which State laws are picked up when State Courts are imposing sentences for Federal offences since, as Basten JA has noted, specific provision is made for intensive correction orders (ICOs) in s 20AB(1AA)(a)(ix) of the Crimes Act 1914 (Cth).”


97. Beech-Jones CJ at CL recently observed the following in the context of the availability of ICOs for federal offenders in Homewood v R [2023] NSWCCA 159 at [4]:

“The provisions of s 20AB make it clear that the various sentencing options specified in s 20AB(1AA) take their colour and meaning from the provisions of the relevant ‘law of the State or Territory’ (s 20AB(1)(b)).”


98. Although it is well settled that a federal offender can be placed on an ICO under the Sentencing Act, it is the extent to which that State law is picked up that is the focus of ground 1. After extracting s 66 in its terms, her Honour stated: “I note that because I am dealing with a Commonwealth offence, I have taken into account the s 16A matters rather than the s 3A matters”. This ground turns on whether her Honour erred in taking that approach.


99. Putting the ICO regime to one side, it is clear that s 3A of the Sentencing Act is not otherwise picked up and applied as federal law: s 16A(2) of the Crimes Act already provides for mandatory factors relevantly similar to those in s 3A. Despite this, s 66(3) of the Sentencing Act required the sentencing judge to have regard to s 3A when considering whether to impose an ICO, even though her Honour was also required to have regard to s 16A for the purposes of the first two steps.


100. The Crown did not contend that only part of s 66 of the Sentencing Act (that is, everything except for the reference to s 3A) was picked up and applied as federal law in this matter. Rather, the Crown’s position was that when considering whether to impose an ICO, s 66(3) of the Sentencing Act requires the court to have regard to the purposes of sentencing in s 3A of that Act, even when sentencing a federal offender. This position is consistent with Stanley and the language of s 66: there are mandatory considerations in s 66 of the Sentencing Act, one of which is that the sentencing judge must have regard to the s 3A factors (s 66(3)). In circumstances where the statutory language of s 66(3) is clear and neither party suggested that s 66(3) should somehow be read subject to s 16A, I am prepared to proceed on the basis that the sentencing judge was required to have regard to s 16A of the Crimes Act for the purposes of the first two steps: determining whether a sentence of imprisonment is required, and if so the length of that term, but then have regard to s 3A when considering whether to impose an ICO.


101. Although the Crown accepted that the trial judge was required to have regard to s 3A for the purposes of 66(3), it was not conceded that this ground should be upheld. It was contended that the fact that her Honour had regard to sentencing principles analogous to those found in s 3A earlier in her decision when she determined to impose a term of imprisonment of 2 years (the first two steps) supports the conclusion that she had regard to them again for the purposes of s 66(3). I cannot accept that submission. As the majority reasons in Stanley observed at [77], although the general purposes of sentencing will have been considered in deciding whether to impose a sentence of imprisonment, community safety is required to be considered again and in a different manner under s 66 when considering whether to make an ICO. It is implicit in this passage of the majority reasons that the general principles of sentencing must also be looked at again at this third stage for the purposes of s 66(3), but with a different focus.


102. It was further submitted on behalf of the Crown that in this impugned portion of her Honour’s remarks (extracted above at [69]) her Honour meant to convey that she had already had regard to s 16A matters in arriving at the sentence of 2 years imprisonment (rather than for the purposes of s 66). Although I accept that there is a degree of ambiguity in the relevant passage, I am satisfied that it reflects that her Honour proceeded on the basis that when imposing an ICO for a Commonwealth offence the reference to “section 3A matters” in s 66C(3) should be read to mean “s 16A matters”.


103. The Crown also submitted that, despite what her Honour said she did (that is; have regard to s 16A rather than s 3A), when regard is had to the impugned passage of her reasons, it can be inferred that she did have regard to the relevant s 3A matters such that any error was not material. On this basis, the determination of this ground turns on whether the misstatement by her Honour that she was to have regard to s 16A rather than s 3A for the purposes of s 66(3) (when sentencing a federal offender) was a material error. The test for materiality was explained by Gleeson JA (with whom Ierace J and I agreed) in Benn v R [2023] NSWCCA 24 at [82] as follows:

“Since Kentwell v The Queen (2014) 252 CLR 601; [2014] HCA 37 at [42], an applicant does not need to establish that an error has had an actual effect on the sentence imposed, only that it has ‘the capacity to influence the sentence’: Newman (a pseudonym) v R [2019] NSWCCA 157 at [11] (Basten JA); Ibbotson (a pseudonym) v R [2020] NSWCCA 92 at [145] (N Adams J, Leeming JA agreeing).”


104. The Crown relied upon the similarity between the s 3A purposes of sentencing and corresponding s 16A(2) factors to establish immateriality. It seems to me that although there are significant similarities as between the two provisions, it could not be said that they are sufficiently similar that it made no difference which one her Honour had regard to.


105. Section 3A of the Sentencing Act lists “[t]he purposes for which a court may impose a sentence on an offender” whereas s 16A(2) provides for the matters “[i]n addition to any other matters” that “the court must take into account” “as are relevant and known to the court”.


106. The sentencing purpose in s 3A(a) is “to ensure that the offender is adequately punished for the offence” whereas s 16A(2)(k) provides for “the need to ensure that the person is adequately punished for the offence”. It is to be accepted that there is no significant difference between these two provisions.


107. The sentencing purpose in s 3A(b) is “to prevent crime by deterring the offender and other persons from committing similar offences” whereas s 16A(2)(j) lists “the deterrent effect that any sentence or order under consideration may have on a person” and s 16(2)(ja) lists “the deterrent effect that any sentence or order under consideration may have on other persons”. Again, it is to be accepted that there is no significant difference between these two provisions.


108. The sentencing purpose in s 3A(c) is “to protect the community from the offender”. There is no analogous provision in s 16A(2). It seems to me that this is a slightly different concept to the notion of “community safety” which is the paramount consideration in s 66(1), the latter of which is looking forward to the risk of reoffending.


109. The sentencing purpose in s 3A(d) is “to promote the rehabilitation of the offender” whereas s 16A(2)(n) lists as a factor “the prospect of rehabilitation” of the person. There is a material difference between these two provisions.


110. The sentencing purpose in s 3A(e) is “to make the offender accountable for his or her actions”. There is no analogous provision in s 16A(2).


111. The sentencing purpose in s 3A(f) is “to denounce the conduct of the offender”. There is no analogous provision in s 16A(2).


112. Finally, the sentencing purpose in s 3A(g) is “to recognise the harm done to the victim of the crime and the community whereas s 16A(d) refers “the personal circumstances of any victim of the offence”, s 16A(e) refers to “any injury, loss or damage resulting from the offence and s 16A(ea) refers to “if an individual who is a victim of the offence has suffered harm as a result of the offence—any victim impact statement for the victim”. Again, it is to be accepted that there is no significant difference between these two provisions.


113. There is some support for the Crown position that her Honour did in fact have regard to s 3A of the Sentencing Act as she referred to the need for “denunciation” which appears in s 3A(f) but is not included in s 16A(2) of the Crimes Act. Despite this, as the above comparison illustrates, it could not be said that the two provisions (s 3A and s 16A(2)) are, relevantly, analogous. Some factors are not common to both and, significantly, the emphasis in some respects is different.


114. The applicant placed particular reliance on the way rehabilitation is to be taken into account in the respective provisions. As the Crown properly conceded, there is a real difference between promoting the rehabilitation of an offender as a purpose of sentencing (s 3A) and considering that offender’s prospect of rehabilitation (s16A). The applicant was assessed as a low risk of reoffending and her Honour expressly found that she had “no doubt” that the consequences of the offending would deter him from any future offending. It was expressly put to the sentencing court that if an ICO was considered, the applicant’s rehabilitation would be best achieved by supervision and access to treatment programs in the community consistent with what this Court held in Pullen.


115. Although her Honour made positive findings regarding the applicant’s prospects of rehabilitation and low risk of reoffending for the purposes of the first two steps, she did not consider that purpose of sentencing again for the purposes of s 66. This is despite the fact that a submission was put to her in this regard. It is to be accepted that her Honour was not required to go through every purpose of sentencing nor to recite all relevant principles for the purposes of considering s 66(3). But given that the s 66(1) and (2) factors militated in favour of an ICO being imposed and that the issue had been raised in submissions, it was only her Honour’s consideration of s 66(3) which could have tipped the balance the other way. In other words, it was the consideration of s 66(3), including the purposes of sentencing in s 3A which her Honour considered determinative.


116. In these circumstances, I am satisfied not only that there are significant textual differences between s 3A(d) of the Sentencing Act and s 16A(2)(n) of the Crimes Act, I am also satisfied that her Honour failed to consider rehabilitation at all under s 66(3) despite it being a matter expressly put to her Honour. That error could not be said to be immaterial.


117. I would uphold ground 1.


Ground 2: In determining whether to impose an intensive correction order her Honour did not take into account community safety as the paramount consideration.


Applicant’s submissions


118. The applicant submitted that the need for punishment, denunciation and general deterrence did not displace the paramount consideration of community safety (under s 66(1) of the Sentencing Act) and could be met by convictions and the imposition of a term of imprisonment to be served by way of an ICO.


119. It was submitted that while her Honour set out the terms of s 66 of the Sentencing Act and was satisfied that the applicant’s risk of reoffending would be better addressed by serving a sentence as an ICO, her Honour gave no consideration to community safety in her assessment of the reoffending risk, nor by reference to the range of conditions that could have been imposed as part of an ICO. Instead, her Honour proceeded directly to s 66(3) and determined to impose a full-time custodial sentence on the basis that “only a full-time custodial sentence can address the need for punishment, denunciation, and fulfil the very strong need for general deterrence”.


120. The complaint was made that her Honour made no finding in relation to the paramount consideration of community safety and, thus, s 66(1) was bypassed. The applicant submitted that her Honour’s approach subordinated the paramount consideration of community safety and was a material error that went directly to the determination not to impose an ICO.


121. It was submitted that it was open to reason (in accordance with Stanley) that an ICO is more likely to address community safety in terms of the applicant’s risk of reoffending. Although general deterrence is a matter attracting significant weight, an ICO should properly be regarded as a custodial sentence. Accordingly, it was submitted, that the paramount consideration of community safety could have been met by convictions and the imposition of a term of imprisonment to be served by way of ICO.


Crown submissions


122. The Crown relied upon her Honour’s express reference to the language of s 66(2) in her reasons and submitted that it could not be said that her Honour failed to have regard to the paramount consideration of community. Her Honour went on to engage in the evaluative exercise required by s 66(3) when she concluded that only a full-time custodial sentence could address the need for punishment, denunciation and to fulfil the very strong need for general deterrence.


123. It was submitted that the paramount consideration in s 66(1) could not require the imposition of a sentence or order that her Honour did not, in her instinctive synthesis, consider was of a severity appropriate in all the circumstances of the offence. Her Honour was evidently of the view that the imposition of an ICO was not of appropriate severity. In those circumstances, the making of such an order would have been inconsistent with her Honour’s primary obligation in s 16A(1) of the Crimes Act and would exceed the express limitation in s 20AB(3).


124. It was submitted that it was within her Honour’s sentencing discretion to find that the need for punishment, denunciation and general deterrence displaced the paramount consideration of community safety. Reliance was placed on the decision of Fangaloka v R at [65]-[66] (considered below).


Consideration: Ground 2


125. I have already considered the scope of s 66 for the purposes of ground 1. But whereas ground 1 was concerned with s 66(3), ground 2 is concerned with her Honour’s consideration of s 66(1).


126. The complaint under this ground is not that the sentencing judge failed to have regard to community safety at all; it was accepted that her Honour expressly engaged with s 66(2) and was satisfied that the applicant's risk of reoffending would be better addressed by serving his sentence by way of an ICO. Rather, the complaint is that although her Honour undertook the assessment required in s 66(2), she failed to expressly address s 66(1). The question is whether, as the Crown contended, the reference to the language of s 66(2) was sufficient to establish that her Honour gave community safety paramount consideration in determining whether to impose an ICO for the purposes of s 66(1).


127. At [74] of Stanley, their Honours stated that s 66(2) “explains how the sentencing court must engage with the paramount consideration of community safety”. Similarly, at [77] their Honours stated: “[a]t this third step, community safety in s 66(1) is given its principal content by s 66(2)”. These observations by the High Court suggest that the requirement in s 66(2) is only part of the court’s requirement to make community safety the paramount consideration in s 66(1). As Simpson JA observed in Mandranis v R at [51], “[t]he better way of addressing an offender’s risk of reoffending [in s 66(2)] is but one of the considerations that contribute to the s 66(1) assessment.”


128. I am not persuaded that the fact that her Honour made the relevant assessment under s 66(2) is a complete answer to the question of whether her Honour also complied with s 66(1) and considered community safety to be the paramount consideration when deciding not to impose an ICO. The Crown’s remaining submissions under this ground turned, to some extent, on the correctness of her Honour’s decision not to impose an ICO and the significance of the need for punishment, denunciation and general deterrence in this matter.


129. As the majority judgment in Stanley observed at [73], when the court is deciding the discrete question of whether to make an ICO, other considerations must be subordinated to the consideration of community safety, but they must (or may) still be taken into account as prescribed by s 66(3). Significantly, despite the majority in Stanley stating at [75] that the assessment required by s 66(2) is not determinative of whether an ICO may or should be made, their Honours went on to observe at [76] that “community safety will usually have a decisive effect on the decision to make, or refuse to make, an ICO, unless the relevant evidence is inconclusive” (emphasis added).


130. The majority in Stanley went on to observe at [76] that there may be cases where a court cannot reach a conclusion regarding the assessment in s 66(2) and in those cases (unlike the present case) “other factors will assume significance and will be determinative”. But these passages in Stanley do not identify the circumstances in which a positive finding for the offender regarding community safety could, nonetheless, lead a sentencing judge to decline to impose an ICO.


131. A recent example of where the court’s finding under s 66(2) was neutral and no ICO was imposed is to be found in Tonga, Samuel v R [2023] NSWCCA 120 (“Tonga”). The applicant in Tonga was sentenced for, inter alia, an offence of recklessly causing grievous bodily harm arising out of a road rage incident. That offence carried a maximum penalty of 14 years imprisonment. The victim received a number of injuries including an open deep skull fracture. The level of violence in the matter was high and the applicant was assessed as a “medium to low” risk of reoffending. He was sentenced to imprisonment for 22 months, with a non-parole period of 13 months. He sought leave to appeal on four grounds which predominantly complained of the manner in which the sentencing judge had considered s 66 of the Sentencing Act. His Honour had stated this in relation to the offending:

“... offences of violence in road rage incidents are far too prevalent in our community and the courts must send a message to the community that such violence will be met with significant sentences.”


132. One of the complaints in Tonga was that the sentencing judge erred when he said this for the purposes of s 66(2):

“I have considered those matters in considering the issue of community safety. I accept that it would appear that making the offender serve the sentence in full-time custody is not more likely to address his risk of reoffending. However, the prevalence of road rage type offences in our community involving very significant violence is such that, in my opinion, the weight to be given to general deterrence here requires that the sentence by served by way of full-time custody.” (Emphasis added.)


133. Basten JA (with whom Walton and Hamill JJ agreed) was satisfied that the finding for the purposes of s 66(2) (italicised above) was inconclusive and that the comparative process could not be resolved on the evidence. His Honour went on (at [39]) to state that “the neutral finding should be understood as leaving the weighing process unresolved”, an outcome expressly envisaged by Stanley at [76]. His Honour went on to observe the following at [41]:

“As Stanley explained, the s 66(2) evaluation is not decisive and was not treated by the sentencing judge as decisive, or as the end of the process. Consistently with Mandranis (and Stanley), had the judge considered that serving a sentence in full-time custody was more likely to benefit community safety than serving the sentence in the community, that finding would not have foreclosed the possibility of an ICO. However, because it was not made, that issue did not arise. On the other hand, if the judge had been satisfied of a contrary position, namely that serving a sentence by way of an ICO was more likely to address the risk of reoffending, that would have been a powerful consideration in favour of an ICO. However, as that finding was not made either, any further question which would have flowed from that finding did not arise.”


134. Basten JA concluded that in the absence of a positive finding under s 66(2), other factors may become more significant. In those circumstances, it was held that the sentencing judge did not err in identifying general deterrence as ultimately being the determinative factor.


135. In Stanley at [107], the majority was critical of the District Court judge for stating, in the context of firearms offences, that general deterrence "must be a very important and central platform of the sentencing exercise". Her Honour’s statement was consistent with general sentencing principles: general deterrence is very important when sentencing for firearms offences. The basis of the High Court’s criticism of this statement in Stanley was that it was made in the context of her Honour’s failure to expressly undertake the s 66(2) assessment. In that context, their Honours observed:

“Rather than treating community safety, in the sense of s 66(2), as the paramount consideration the District Court Judge infused that concept with notions of general deterrence.”


136. In Tonga, a purpose of sentencing in s 3A (general deterrence) had a determinative effect. Such a result was consistent with Stanley at [76], where it was held that such a consideration could arise when no positive finding can be made under s 66(2). But what about where, as in the applicant’s case, the sentencing court is easily able to make a positive finding for the purposes of s 66(2)? If the paramount consideration is community safety and all factors relevant to that consideration militate in favour of an ICO, what are the circumstances in which a sentencing court may nonetheless decline to impose an ICO?


137. The Crown’s position was that the sentencing court ought not be required to impose an ICO unless such an order is considered appropriate in the exercise of the court’s instinctive synthesis. In other words, if the sentencing judge court reaches the view that an ICO would be too lenient he or she is not required to impose one. In support of that position reliance was placed upon Fangaloka at [66]-[67] in which Basten JA (with whom Johnson and Price JJ agreed) observed the following:

“[66] There is no doubt that community safety can operate in different ways in different circumstances. It is conventionally accepted that a purpose of punishment, including by way of imprisonment, is to deter the offender from further offending; it is also accepted that removal of an offender from the community for a period may have a protective function. The purpose of s 66, on this approach, is merely to ensure that the court does not assume that fulltime detention is more likely to address a risk of reoffending than a community-based program of supervised activity. Consistently with that view, s 66 does not seek to address potentially conflicting demands of community safety in the short term, as opposed to the longer term, and the risk that leniency will be abused. In short, there is nothing in s 66 which favours an ICO over imprisonment by way of fulltime custody. Further, while s 66 expressly referred to s 3A, it did so, not by identifying it as a set of ‘subordinate’ considerations, but as mandatory considerations. It would be wrong for a court to treat every consideration other than the means of addressing the risk of reoffending as a subordinate consideration.

[67] Although the sentencing judge in the present case did not expressly refer to Pullen; she adopted an approach which had the effect of giving little weight to other purposes. No doubt there will be cases in which a person otherwise likely to serve fulltime custody will obtain an ICO, because general deterrence is largely disregarded in favour of a possible reduction in the risk of reoffending by the particular offender, if not sent to gaol. On the other hand, there will remain cases in which the significant element of leniency contained in an ICO is inconsistent with the imposition of an adequate penalty, so that an ICO is an unacceptable form of punishment.”


(Emphasis added.)


138. Fangaloka was decided prior to the decision in Stanley. I have some reservations as to whether the italicised portion in [67] of Fangaloka remains a correct statement of principle concerning s 66(3) following the decision of the majority in Stanley (at [71]-[77] but particularly at [76]).


139. There can be no doubt that imposing an ICO involves a degree of leniency. In Pullen Harrison J observed the following at [53]:

“Although an ICO ordinarily involves substantial punishment, it also reflects a significant degree of leniency: R v Pogson; R v Lapham; R v Martin (2012) 82 NSWLR 60; [2012] NSWCCA 225 at 84 [106]; Whelan v R (2012) 228 A Crim R 1; [2012] NSWCCA 147 at [120].”


140. More recently, Basten JA observed the following in Tonga at [20]:

“Were an ICO not seen as a more lenient sentence than the same period served in custody, there would be no application for leave to appeal. Secondly, whether or not one thinks that the proposed supervision plan amounts to ‘intensive correction’, it would have been vastly less intrusive than a fulltime deprivation of liberty.”


141. But there is no mention of the concept of “leniency” in connection with the imposition of an ICO in the decision in Stanley. Although the majority stated at [76] that a positive finding for the purposes of s 66(2) will usually have a decisive effect on the decision of whether to impose an ICO, a concern about the degree of leniency associated with such a course is not identified by the majority as a factor militating against that course being taken.


142. The degree to which an ICO may be considered a lenient alternative to full-time imprisonment depends on the conditions attached to it. There are two standard conditions of an ICO under s 73(2) of the Sentencing Act (the offender must not commit any offence and the offender must submit to supervision by a community corrections officer). In addition, s 73A(1)-(1A) requires the court to impose at least one additional condition unless there are exceptional circumstances. The additional conditions under s 73A(2) are as follows:

(a) a home detention condition,

(b) an electronic monitoring condition,


(c) a curfew condition imposing a specified curfew,


(d) a community service work condition requiring the performance of community service work for a specified number of hours (not exceeding 750 hours or the number of hours prescribed by the regulations in respect of the class of offences to which the relevant offence belongs, whichever is the lesser),


(e) a rehabilitation or treatment condition requiring the offender to participate in a rehabilitation program or to receive treatment,


(f) an abstention condition requiring abstention from alcohol or drugs or both,


(g) a non-association condition prohibiting association with particular persons,


(h) a place restriction condition prohibiting the frequenting of or visits to a particular place or area.


143. All of those potential additional conditions (except for a community service work condition) would appear to be aimed at minimising risk. The higher the risk of reoffending, the greater the number of additional conditions that could be imposed. But an offender such as the applicant not only poses a low risk to community safety; the nature of that risk (white collar crime) is not met by the imposition of the more onerous conditions that can be imposed under an ICO such as electronic monitoring, a curfew, or a place restriction condition. This means that the nature of an ICO imposed on a white collar offender such as the applicant will usually be less onerous than an ICO imposed on a violent offender who would be more likely to have more of the additional conditions imposed. That flows from the fact that such offenders usually having fewer rehabilitative needs.


144. A similar issue arose for consideration under the previous ICO scheme (prior to the 2018 amendments). In R v Pogson; R v Lapham; R v Martin (2012) 218 A Crim R 396; [2012] NSWCCA 225 (“Pogson”) this Court sat a five judge bench (McClellan CJ at CL, Johnson, Price, RA Hulme and Button JJ) to consider the correctness of R v Boughen; R v Cameron (2012) 215 A Crim R 476; [2012] NSWCCA 17 and R v Agius; R v Zerafa (2012) 87 ATR 528; [2012] NSWSC 978. Those decisions had held that an ICO was not available as a matter of law to white collar offenders as they had no rehabilitative needs. In Pogson, the court held that those decisions were wrong and should not be followed given the statutory language of the provisions as they then were. Although Pogson was concerned with the ICO statutory scheme prior to the 2018 amendments, and is, thus, of only limited application, it shows the tension in reconciling the leniency inherent in an ICO with the need for general deterrence for white collar offenders.


145. During the hearing of this appeal, senior counsel for the applicant was invited to address the question of how, given the reasons of the majority in Stanley at [71]-[77], a sentencing court is to apply the important sentencing principles of general deterrence, punishment and denunciation in relation to white collar offenders when such offenders are often likely to be the subject of favourable findings for the purpose of s 66(1) and (2). It was submitted on behalf of the applicant that there may be cases where factors in s 66(3) could accumulatively have a determinative effect and militate against the imposition of an ICO, but that this was not such a case. It seems to me that although the first part of this submission may be technically correct given the statutory language of s 66, it is difficult to reconcile with Stanley at [76]. As for the second part, it was not the applicant’s contention under this ground that her Honour erred in not imposing an ICO. Rather, the complaint is that her Honour failed to have regard to community safety as the paramount consideration in her decision.


146. I note in passing that although the applicant poses a very low risk to community safety, it could not be said that he poses no risk to community safety just because he is no risk of committing an offence of violence. As the majority reasons in Stanley observed at [72] in the context of s 66(2), “community safety” principally concerns the “possible harms” to the community that might occur in the future from the risk of reoffending by the offender. Thus, although a non-violent offender such as the applicant does not pose any risk to the individual safety of any person in the community, it must be accepted that if the applicant was to reoffend in the same way the community would be “harmed”.


147. Not only did her Honour fail to state that she was giving paramount consideration to community safety, her reasons do not disclose why her Honour was satisfied that principles of punishment, denunciation and general deterrence were more important than community safety, and other s 3A factors such as rehabilitation. Matters relevant to community safety (for the purposes of s 66(1)) included that the applicant was of prior good character, he was remorseful, he had insight into his offending and had volunteered 60% of the criminality he pleaded guilty to. Mr Sheahan’s opinion was that he was a “very low range in terms of risk of reoffending” and that he did not display any of the characteristics associated with recidivism. Her Honour was satisfied that he had good prospects of rehabilitation, was a low risk of reoffending and unlikely to reoffend.


148. It is tolerably clear to me that, despite her Honour’s positive findings regarding community safety in s 66(2), her Honour formed the view that the degree of leniency involved in the imposition of an ICO was not warranted in this case given the offending involved a breach of trust and a fraud on taxpayers’ money. This is one of those cases adverted to by the majority in Stanley (at [76]) where the positive finding under s 66(2) did not have a decisive effect in the applicant’s case. In those circumstances, I am satisfied that her Honour’s failure to refer specifically to s 66(1) and the paramount consideration of community safety in her reasons for declining to impose an ICO leaves open the inference that she did not have regard to it in the manner required by s 66(1).


149. As for the question of whether, following the decision of the majority in Stanley, a concern about leniency can be a relevant factor militating against the imposition of an ICO, it was raised but not decided in Decision restricted [2023] NSWCCA 186. In that case, the Crown appealed against the manifest inadequacy of an aggregate sentence of 2 years and 6 months imprisonment to be served by way of an ICO for serious money laundering offences. The appeal was successful, and the respondent re-sentenced to an aggregate sentence of 4 years imprisonment, rendering him ineligible to be considered for an ICO. In those circumstances, this Court did not need to consider the argument as to whether there is “leniency” associated with a decision that a sentence be served by way of an ICO. In that context, Beech-Jones CJ at CL (with whom Fagan J and R A Hulme AJ agreed) observed the following at [57]-[58] (after setting out the relevant three-step process at [56]):

“[57] It follows that a complaint that a sentence ordered to be served by way of an ICO is manifestly inadequate will have to address the above process and, in respect of the third step, the reasons of the majority in Stanley at [71]−[77] concerning the application of s 66 of the Sentencing Act. There may be scope for argument about whether that reasoning precludes, or at least affects, a contention that a sentence is manifestly inadequate simply because it involves the sentence being served by way of an ICO as opposed to full-time custody.

[58] It is not necessary to consider this further because the balance of these reasons is directed to the second step in the above process, namely, the assessment of the appropriate length of the sentence imposed. As I consider that the imposition on the respondent of any term of imprisonment of 3 years or less to be manifestly inadequate, it is not necessary to determine whether the fact the respondent’s sentence was ordered to be served by way of an ICO is an additional factor why it is manifestly inadequate.”


(Emphasis added.)


150. I too am satisfied that there is scope for an argument that, following the reasons of the majority in Stanley at [71]-[77], a sentencing judge cannot decline to impose an ICO on an offender who otherwise would meet the tests in ss 66(1) and (2) on the basis that such a result would render the sentence too lenient. But, like Beech-Jones CJ at CL, I do not consider it necessary to determine that question to dispose of the present appeal. Nor was it the subject of any submissions at the hearing in this matter.


151. Overall, I am satisfied that despite the otherwise clear and careful reasons of the sentencing judge, her Honour did not approach the question of whether an ICO should be imposed on the applicant by treating community safety as the paramount consideration.


152. I would uphold ground 2 as well.


Re-sentence


153. Since error has been found in relation to grounds 1 and 4, it is necessary for this Court to exercise its own independent sentencing discretion for the purpose of determining whether a lesser sentence should be imposed under s 6(3) Criminal Appeal Act 1912 (NSW): Kentwell v The Queen (2014) 252 CLR 601; [2014] HCA 37 at [43]. In light of the need to re-sentence, it is not necessary to consider ground 3, which alleged that the sentence is manifestly excessive. Despite this, I will consider the parties’ submissions in relation to manifest excess as part of the re-sentencing.


154. The applicant provided an affidavit dated 5 June 2023 outlining his experience and behaviour in custody. He wrote that he has been well behaved, has not breached any disciplinary rules and has worked at every opportunity, including as a kitchen hand, picking apples and now as a senior clerk for the farm. He has taken two available courses and is enrolled in two more. He was unable to do any formal vocational education as he was told he was over-qualified. He tries to speak to his wife daily on the phone, and his wife and his 12-year-old son visit during school holidays and on long weekends.


155. This material confirms the material before the sentencing judge: the applicant has excellent prospects of rehabilitation.


156. The applicant’s legal representative, Mr Woodhouse, also provided two affidavits dated 5 June 2023 and 23 June 2023. The applicant’s atopic dermatitis and asthma both worsened when he entered custody and he had to be taken to hospital for his asthmatic condition on 30 December 2022. The applicant now receives his prescribed medication.


157. I have already set out the objective and subjective factors relevant to the re-sentencing of the applicant above. I adopt the findings of the sentencing judge. It was not submitted that I would do otherwise.


158. I too am satisfied that a sentence of imprisonment was warranted, but in the exercise of my sentencing discretion I would have imposed a different aggregate sentence.


159. The applicant is to be sentenced for three offences which carry a maximum penalty of only 2 years imprisonment. I have arrived at an aggregate sentence of 18 months with indicative sentences as follows (applying the 25% discount to the indicative sentences):

(1) Seq. 2: 10 months imprisonment

(2) Seq. 3: 10 months imprisonment

(3) Seq. 4: 9 months imprisonment


160. I turn then to consider whether the applicant should serve that sentence in custody or under an ICO in the community. I note that the Sentencing Assessment Report considered that a supervision condition is sufficient to implement the supervision plan and that Community Corrections assessed the applicant as suitable to undertake community service work: s 73A(3) of the Sentencing Act. I have proceeded on the basis that the paramount consideration is community safety, and that the applicant poses a very low risk to community safety. I make the same finding as her Honour under s 66(2) that the applicant’s risk of reoffending would be better met on an ICO than in custody. Having regard to the s 66(3) factors, I am satisfied that general deterrence, denunciation and punishment are important sentencing principles but so too is rehabilitation. Having regard to all of the matters that I have already considered under grounds 1 and 2, I am satisfied that, giving paramount consideration to community safety, this is an appropriate case in which the applicant can serve his sentence by way of an ICO.


161. The applicant has been in custody serving his sentence since 10 November 2022. Under s 71 of the Sentencing Act an ICO commences on the date it is made. Unlike a sentence of imprisonment served in custody, the sentence cannot be backdated. The 9 months and 13 days imprisonment the applicant has already served cannot strictly be accounted for. This difficulty was considered in Mandranis. In that decision, Simpson JA, with whom Garling J and I agreed, observed the following at [61]:

“Provided that the appropriate term of the sentence is determined before consideration is given to an ICO, it would, if an ICO is found to be appropriate, be acceptable for that term to be adjusted by the deduction of a period equivalent to the term of pre-sentence custody, so that the ICO commences on the day it is made (in compliance with s 71) and is co-extensive with the term of imprisonment (as required by s 70). The sentence actually recorded and imposed would be less (by the length of the pre-sentence custody) than the sentence found to be appropriate to meet the purpose of sentencing.”


162. Given that I would impose a sentence of 18 months imprisonment, if I was to reduce that by 9 months and 13 days to account for his time already served that would leave the applicant with a sentence of 8 months and 17 days to be served by way of an ICO.


163. During the hearing of this appeal, Mr Jordan SC submitted that on re-sentence this Court would either impose a much more limited form of ICO or the applicant could receive a sentence of imprisonment which would see him released at the time of this decision with “time served”. It was accepted that such a position was inconsistent with the nub of this appeal that an ICO was warranted but it was submitted that matters had effectively moved along such that the applicant has already served a sentence of full-time imprisonment.


164. I am satisfied that the former of these two courses is the appropriate one. Given the low rehabilitative needs of the applicant and the fact that he has already served (as of today’s date, 9 months and 13 days) in full-time custody, I am satisfied that there are exceptional circumstances for the purposes of s 73A(1) of the Sentencing Act such that I propose to only impose the standard conditions in this matter.


165. As was noted in Mandranis, the effect of s 71 of the Sentencing Act is that the length of the term of imprisonment imposed on the applicant on re-sentence is shorter than would have been the case had I been sentencing the applicant at first instance. In the intervening period he has now served over 9 months in full time custody. Although it will be apparent from these reasons that I would have imposed an aggregate sentence of 18 months imprisonment, that fact will not be apparent from the sentence alone.


166. Accordingly, I would propose the following orders:


(1) Leave to appeal is granted.

(2) The appeal is allowed.

(3) The sentence imposed by Bright DCJ on 10 November is quashed and in lieu thereof the following sentence is imposed:

(a) An aggregate sentence of 8 months and 17 days imprisonment to commence on 23 August 2023.

(4) Pursuant to s 7(1) of the Sentencing Act, the sentence imposed on the offender is to be served by way of an intensive correction order commencing on 23 August 2023 and expiring on 9 May 2024.

(5) The standard conditions of the order will apply. Namely,

(a) The offender must not commit any offence; and

(b) The offender must submit to supervision by a community corrections officer for the term of the order.


(6) If the offender fails to comply with the conditions of the order, sanctions may be imposed by the Commissioner of Corrective Services. Those sanctions may include a formal warning, the imposition of more stringent conditions or may include revocation of this order. If the order is revoked, the offender may be required to serve all or some of the period of the sentence in full-time custody.

(7) The offender is to report to Community Corrections office as soon as practicable but no later than within seven days.

(8) A copy of this order will be forwarded to the offender.


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