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State v Eliakim [2007] PGNC 76; N3190 (16 March 2007)

N3190

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

CR NO 778 0F 2004

THE STATE

V

HENRY ELIAKIM

Bialla: Cannings J
2007: 12, 15, 16 March

CRIMINAL LAW – sentences – Criminal Code, Section 407 (conspiracy to defraud) – Criminal Code, Sections 372(1) and (7)(a) (employee stealing from employer) – sentence on plea of guilty – two offences – total sentence 18 months imprisonment – offender to serve three months in custody.

A man pleaded guilty to one count of conspiracy to defraud and one count of stealing money from his employer. The amount involved was K3,369.01. He was a field supervisor in a company and he planned with two others to submit false attendance sheets for ghost employees and obtain pay cheques. He put the plan into action over a three-month period until caught.

Held:

(1) The starting point for sentencing for conspiracy to defraud, is 3 years, 6 months imprisonment.

(2) The starting point for sentencing for an employee stealing from an employer, is 3 years, 6 months imprisonment.

(3) Each offence was allotted a notional sentence: count 1, 18 months; count 2, 18 months; a total of 36 months.

(4) Both sentences should be served concurrently as the offences were part of the same set of transactions. The total sentence of 18 months is not excessive.

(5) The offender was sentenced to three months in custody and had the balance of the sentence suspended, subject to various conditions including that he make restitution, in kind, to his former employer within six months after the date of release from custody.

Cases cited

Saperus Yalibakut v The State SCRA No 52 of 2005, 27.04.06
The State v A Juvenile, "TAA" (2006) N3017
The State v Augustine Seckry CR 376/2005, 19.04.05
The State v Iori Veraga (2005) N2921
The State v Joyce Gulum CR 1620/2005, 06.04.06
The State v Obert Poesan Pokanas (2004) N2702
The State v Paul Taro CR 237/2006, 03.08.06
The State v Richard Dusal Bix and Siprian Sipi Karo (2003) N2415
The State v Rictor Naiab CR 387/2005, 08.09.05
The State v Robert Kawin (2001) N2167
The State v Rochus Navus CR No 390 of 2005, 19.04.05
Tom Longman Yaul v The State (2005) SC803
Wellington Belawa v The State [1988-89] PNGLR 496

PLEA

The accused pleaded guilty to conspiracy to defraud and stealing and the following reasons for sentence were given.

Counsel

F Popeu, for the State
O Oiveka, for the accused

16 March, 2007

SENTENCE

1. CANNINGS J: This is a decision on the sentence for a man who pleaded guilty to two charges: conspiracy to defraud and stealing from his employer.

INDICTMENT

2. The indictment was framed as follows:

• Count 1 – conspiracy to defraud – an offence under Section 407(1)(b) of the Criminal Code;
  
• Count 2 – stealing from employer – an offence under Sections 372(1) and (7)(a) of the Criminal Code.
  

CONVICTION

3. The offender pleaded guilty to the following facts:

• He was employed as a field supervisor by Hargy Oil Palms Ltd. He was engaged in the harvesting and maintenance section at Area 8, Urumaili. His responsibilities included keeping records of attendance of employees and filling in time sheets for purposes of processing their pays.
  
• In September 2003 a number of casual workers were laid off. However, he conspired with two other Hargy employees to ensure that attendance sheets for the five laid-off workers were still completed. Upon receiving them he would approve them and send them to the accounts section for their pays to be processed. The pay cheques for the laid-off workers continued to be raised and he received them. He arranged to have the cheques cashed and shared the proceeds with the two with whom he had conspired.
  
• He received a total of K3,369.01 until caught out in December 2003.
  
• He therefore entered into a conspiracy to defraud his employer and he stole from his employer.
  

4. I entered a provisional plea of guilty and then, after reading the District Court depositions, confirmed the plea and convicted him of the two offences, as charged. He is now referred to as the offender.

ANTECEDENTS

5. The offender has no prior convictions.

ALLOCUTUS

6. I administered the allocutus, ie the offender was given the opportunity to say what matters the court should take into account when deciding on punishment. A paraphrased summary of his response follows:

I had been working with the company for three years when I committed these offences. I have three children in high school. I have arranged with the company to supply them with timber and pay back the money that I stole.

I ask the court for mercy. This is my first time to be in court. I say sorry to the company and to everyone in the courtroom today. Please consider putting me on a good behaviour bond.

OTHER MATTERS OF FACT

7. As the offender has pleaded guilty he will be given the benefit of the doubt on mitigating matters raised in the depositions, the allocutus or in submissions that are not contested by the prosecution (Saperus Yalibakut v The State SCRA No 52 of 2005, 27.04.06, (Jalina J, Mogish J, Cannings J)). In his police interview in March 2004 the offender made admissions and made a full confessional statement. He also left the company of his own volition. He was not sacked.

PRE-SENTENCE REPORT

8. To help me make a decision on the appropriate sentence and determine whether any of it should be suspended I requested and received a pre-sentence report under Section 13(2) of the Probation Act for the offender. The report, prepared by the Kimbe office of the Community Corrections and Rehabilitation Service, is summarised below.

HENRY ELIAKIM

Age: 43-year-old male.

Family background: parents are from Kukula village, Bialla area – born and raised here – oldest in family of 12 – lives in the village. Father died in 2001. Mother alive but frail.

Marital status: Married with seven children; some of the children are employed or doing tertiary education, eg DWU.

Education: grade 8, Hoskins Secondary School, 1977.

Employment: consistently employed in the formal sector from 1987 to end of 2003 when the offences were committed. Employed on various plantations, including 13 years as a field supervisor, the last three with Hargy.

Health: OK.

Financial status: has four blocks that he works to sustain himself and the family – owns a chainsaw, which he uses to cut timber and sell – this is what he proposes to do to pay off the money that he stole from the company.

Plans: wants to establish an oil palm estate – complete the permanent house in the village – reconcile with the company – look after his mother.

Attitude of community to the offence: a village leader, Exson Rogi, says the offender is highly regarded in the village and the offender is a clan leader; HOPL company secretary, Cosmas Kaue, would prefer that the offender repay the money rather than go to jail – arrangements have already been made re supply of sawn timber – the company did not terminate him as he was one of the company’s most experienced and diligent workers.

Attitude of family: his wife and children are very supportive of him – don’t want to see him go to jail.

Recommendation: the offender is suitable for probation – capable of repaying money if he is given time.

SUBMISSIONS BY DEFENCE COUNSEL

9. Mr Oiveka highlighted the following mitigating factors: the offender pleaded guilty; he made admissions freely to the police; he has expressed genuine remorse; he has a big family to care for; the company does not want him to go to jail. The offender has been made a scapegoat, as the other two with whom he entered in the conspiracy were not charged.

10. He should be given a suspended sentence, Mr Oiveka submitted.

SUBMISSIONS BY THE STATE

11. Mr Popeu, for the State, submitted that to be consistent with similar sorts of cases decided recently in WNB the offender should be sent to jail.

DECISION MAKING PROCESS

12. To determine the appropriate penalty I will adopt the following decision making process:

• step 1: what is the maximum penalty?
  
• step 2: what is a proper starting point?
  
• Step 3: what other sentences have been imposed recently for equivalent offences?
  
• step 4: what is the head sentence for each offence?
  
• step 5: should the sentences be served concurrently or cumulatively?
  
• step 6: what is the effect of the totality principle?
  
• step 7: should the pre-sentence period in custody be deducted from the term of imprisonment?
  
• step 8: should all or part of the sentence be suspended?
  

STEP 1: WHAT IS THE MAXIMUM PENALTY?

13. The offender has been convicted of offences under Section 407(1) and Sections 372(1) and (7)(a) of the Criminal Code.

14. Section 407(1) (conspiracy to defraud) states:

(1) A person who conspires with another person—

(a) by deceit or any fraudulent means to affect the market price of any thing publicly sold; or

(b) to defraud the public, or any person (whether or not a particular person); or

(c) to extort property from any person,

is guilty of a crime.

Penalty: Imprisonment for a term not exceeding seven years.

15. Section 372 (stealing) relevantly states:

(1) Any person who steals anything capable of being stolen is guilty of a crime.

Penalty: Subject to this section, imprisonment for a term not exceeding three years.

(7)(a) If the offender is a clerk or servant, and the thing stolen ... is the property of his employer, he is liable to imprisonment for a term not exceeding seven years.

16. The offender therefore faces a maximum of seven years imprisonment for each offence. For both offences the total maximum sentence is:

• 7 years + 7 years = 14 years.
  

17. The court has a considerable discretion whether to impose the maximum penalty by virtue of Section 19 of the Criminal Code.

STEP 2: WHAT IS A PROPER STARTING POINT?

18. From time to time the Supreme Court gives sentencing guidelines in the course of deciding criminal appeals or reviews. These guidelines are often expressed in terms of a ‘starting point’ for various types of cases. The National Court then applies those starting points in the course of looking at each case on its merits and identifying the aggravating and mitigating circumstances.

19. In the present case I have been unable to locate suitable precedents, so I will use the mid-point of three years, six months as the starting point for each offence.

STEP 3: WHAT SENTENCES HAVE BEEN IMPOSED FOR EQUIVALENT OFFENCES?

20. One of the more recent cases on conspiracy to defraud is The State v Iori Veraga (2005) N2921. Sakora J convicted a valuer implicated in the NPF Inquiry of two counts of conspiracy to defraud the NPF. There were three others involved in the conspiracy and the offender obtained K235,000.00. He pleaded not guilty. He was sentenced to four years imprisonment on each charge of conspiracy, to be served concurrently. He was given an extra two years for misappropriation convictions.

21. As for sentences for stealing Kandakasi J has dealt with a number of cases, which give an indication of sentencing trends. For example:

• The State v Robert Kawin (2001) N2167: a man stole K2,250.00 from his workmate and pleaded guilty. The maximum sentence was three years and he was sentenced to two years.
  
• The State v Richard Dusal Bix and Siprian Sipi Karo (2003) N2415: the offenders stole K2,700.00 from a hotel bar. They returned K800.00 to the owner. They were each sentenced to three years imprisonment.
  
• The State v Obert Poesan Pokanas (2004) N2702: a man pleaded guilty to stealing an outboard motor from a boat. The motor was later recovered. He was sentenced to five years imprisonment.
  

22. In West New Britain, the only sentence for stealing the National Court has handed down in recent times was in The State v Rochus Navus CR No 390 of 2005, 19.04.05. A man pleaded guilty to stealing two chainsaws worth K7,000.00 each, which were later returned to the owner. He was sentenced to two years imprisonment.

23. I will now set out the sentences I have recently imposed for a dishonesty offence similar to the sort of stealing offence of which the offender has been convicted: misappropriation. In all of the cases in the following table the offender was the employee of a company who pleaded guilty. It is a different offence and the maximum penalty in these cases was ten years, not seven. Caution needs to be used when referring to these sentences. Nonetheless they provide a useful guide to the sort of sentence that should be imposed in the present case.

TABLE 1: NATIONAL COURT SENTENCES
FOR MISAPPROPRIATION
WEST NEW BRITAIN 2005-2006
BY CANNINGS J

STEP 4: WHAT IS THE HEAD SENTENCE FOR EACH OFFENCE?

24. I will deal first with the stealing offence. I have developed a list of relevant considerations based on the sentencing criteria given by the Supreme Court in Wellington Belawa v The State [1988-89] PNGLR 496. That was a misappropriation case but the sentencing principles for that crime are similar to those for stealing from an employer.

25. Various considerations have been framed so that an affirmative (yes) answer can be regarded as a mitigating factor, a negative (no) answer will be an aggravating factor and a neutral answer will be a neutral factor. The more mitigating factors that are present, the more likely it is that the head sentence will be reduced. The more aggravating factors present, the more likely it is that the head sentence will be lifted above the starting point.

26. Three sorts of considerations are listed. Nos 1 to 6 focus on the circumstances of the offence. Nos 7 to 11 focus on what the offender has done since he committed the crime and how he has conducted himself. Nos 12 to 15 look at the personal circumstances of the offender and give an opportunity to take into account any other factors not previously considered.

1. Was only a small amount of money involved? Yes, in light of the fact that the money was stolen from a company with a large turnover.
   
2. Was the offender in no special position of trust? Neutral.
   
3. Did the transactions take place over a short period and not involve a pre-meditated, plan of deceit? No, they took place over a three-month period.
   
4. Was the money or property applied to a good use? Neutral.
   
5. Did the offender’s actions have only a small adverse effect on other persons, eg the owner of the property, and were the victims in a position to carry the losses caused by the offender? Yes.
   
6. Did the offender’s actions have only a small adverse effect on public confidence in the integrity of the industry? Yes. The offender’s actions had only a small adverse effect on public confidence in the integrity of the company. No doubt it was well known within the company what had happened after the offender was detected. But there is no evidence that the affair caused any widespread loss of confidence in the integrity of the company or the industry in which it operates.
   
7. Did the offender give himself up before being detected? No.
   
8. Did the offender cooperate with the police in their investigations? Yes.
   
9. Has the offender repaired his wrong, eg by repaying the money? No.
   
10. Has the offender pleaded guilty? Yes.
    
11. Has the offender genuinely expressed remorse? Yes.
    
12. Is this his first offence? Yes.
    
13. Has the offender and his family already paid a heavy price for his actions? Yes, he has given up his job, apparently due to the shame he has felt; as has his wife who was also employed by Hargy Oil Palms.
    
14. Can the offender be regarded as a youthful offender or are his personal circumstances such that they should mitigate the sentence? No. He is a mature aged man, with a good and long record of employment. He should have known better.
    
15. Are there any other circumstances of the offence or the offender that warrant mitigation of the head sentence? Yes, the company does not want him given a lengthy sentence or sent to jail. He did the honourable thing by resigning from the company.
    

27. To recap, the following are mitigating factors:

• No 1 – small amount;
• No 5 – small effect on company;
• No 6 – small effect on banking system;
• No 8 – co-operated with police;
• No 10 – pleaded guilty;
• No 11 – expressed remorse;
• No 12 – first offender;
• No 13 – already paid heavy price;
• No 15 – company speaks highly of him.
  

28. The following are aggravating factors:

• No 3 – plan of deceit;
• No 7 – did not give himself up;
• No 9 – no repayment yet;
• No 14 – should have known better.
  

29. The others are neutral factors.

30. After weighing all these factors and bearing in mind that there are nine mitigating factors compared to four aggravating factors, and comparing this case with other reported sentences for stealing and misappropriation, the head sentence should be below the starting point of three years, six months.

31. I impose a head sentence of 18 months imprisonment on count 2.

32. As for count 1, the conspiracy to defraud, the circumstances in which this offence was committed are similar to those applying to count 2. The head sentence should be the same: 18 months.

33. To summarise, the total potential sentence is:

STEP 5: SHOULD THE SENTENCES BE SERVED CONCURRENTLY OR CUMULATIVELY?

34. I now have to decide whether the sentences should be served concurrently or cumulatively. The principles to apply are:

• First, apply the "one transaction rule". Where two or more offences are committed in the course of a single transaction, all sentences in respect of the offences should be concurrent.
  
• Secondly, where the offences are so different in character, or in relation to different victims, cumulative sentences are normally applicable, eg burglary and violence to the householder, or assault plus escaping from custody, or sexual assaults on different victims.
  
• Thirdly, apply the "totality principle". When the court has arrived at appropriate head sentences and decided whether they should be concurrent or cumulative, it must look at the total sentence and see if it is just and appropriate. If it is not, one or more of the sentences should be varied to get a just total. (See The State v A Juvenile, "TAA" (2006) N3017.)
  

35. The one transaction rule applies here. The conspiracy to defraud was part and parcel of the stealing. The sentences of 18 months for each offence will be made concurrent.

Thus:

18 months (counts 1 and 2 concurrently) = 18 months.

STEP 6: WHAT IS THE EFFECT OF THE TOTALITY PRINCIPLE?

36. I now look at the total sentence that the offender is potentially facing, to see if it is just and appropriate having regard to the totality of the criminal behaviour involved. The court needs to guard against imposing a crushing sentence, ie one that is ‘over the top’ or manifestly excessive.

37. I do not think a total sentence of 18 months is excessive for these sorts of crimes. Hatching a scam with fellow employees to steal money from your employer through the use of ghost employees is a very serious matter. These were crimes of dishonesty and the sentence must reflect the community’s disappointment at this sort of corruption within a company. Corruption is not acceptable in this country, whether it happens in the public sector or in the private sector, and whether it is on a grand scale or is an isolated, small scam.

STEP 7: SHOULD THE PRE-SENTENCE PERIOD IN CUSTODY BE DEDUCTED FROM THE TERM OF IMPRISONMENT?

38. The offender has spent two days in custody in connexion with these offences and it is proper that that period be deducted from the total sentence. I decide under Section 3(2) of the Criminal Justice (Sentences) Act that there will be deducted from the term of imprisonment the whole of the pre-sentence period in custody, as shown in table 2:

TABLE 2: CALCULATION OF FINAL SENTENCE

STEP 8: SHOULD ALL OR PART OF THE HEAD SENTENCE BE SUSPENDED?

39. I now have to decide whether the sentence should be served in custody or whether all or part of it should be suspended. It is becoming common practice for the courts to fully suspend sentences for dishonesty offences or other non-violent crimes. I query whether the courts have gone too far in that direction. There is a risk in immediately suspending the sentence that the offender and the community might too quickly forget that he has been convicted of criminal offences involving deceit and fraud.

40. This is an appropriate case in which to consider a suspended sentence in view of the restitution that is planned. However, I agree with Mr Popeu’s submission that some time in custody is required. This is the approach that I have been taking with other dishonesty cases in WNB and I feel I must be consistent. The sentence should provide a deterrent against similar acts of dishonesty by company employees.

41. I will order that the first three months of the sentence must be served in custody. Upon release from custody the following conditions will apply:

42. The last condition means that if any of the other conditions is breached, any person may report the matter to the police or to any person nominated to supervise the offender or to the WNB Senior Probation Officer, any of who may bring the matter to the attention of the National Court. The Court may then issue a warrant for arrest of the offender and he can be brought before the Court to show cause why he should not be sent to jail to serve the rest of his sentence. (See Tom Longman Yaul v The State (2005) SC803, Salika J, Mogish J, Cannings J.)

SENTENCE

43. Henry Eliakim, having been convicted of one count of conspiracy to defraud and one count of stealing, is sentenced as follows:

Sentenced accordingly.
_________________________

Public Prosecutor: Lawyer for the State
Public Solicitor: Lawyer for the Accused