N5955

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

CR (FC) 47 OF 2014

BETWEEN:

THE STATE

AND:

ISAIAH GUDA

Waigani: Salika, DCJ
2014: 20 November; 05 December
2015: 15 April

CRIMINAL LAW - PRACTICE AND PROCEDURE – Sentence – dishonesty offence – dishonestly applying property to his own use – s.383A of Criminal Code

PRACTICE and PROCEDURE – Sentence – Funds belonging to an Incorporated Land Group - Prisoner not an authorised person to withdraw monies belonging to the Land Group. Prisoner illegally withdrew K436,000 belonging to the Moga Incorporated Land Group.

Cases cited:

State v Mathew Kana CR No 843 of 2012 
State v Ludwina Tokiapron (2005)
State v Niso (2005) N2930
State v Buygonnes Tuse Nae (1996) N1474
State v Pongowen Popei and Mark Regione CR 659 and 660 of 2012

Counsel:

Mr W Paka, for the State
Mr J Mesa, for the Defendant

15th April, 2014

1.	SALIKA DCJ: Introduction: The prisoner in this matter pleaded guilty to one count of dishonestly applying to his own use and to the issue of Tony Dunstan and Karen Rema K436,000.00 the property of the Moga Incorporated Land Group.

2.	The prisoner Isaiah Guda and another person namely Tony Dunstan on different occasions between the 1st day of July 2012 and the 31st day of August 2012 withdrew K436,000.00 from Moga Incorporated Land Goup's (ILG) account held at Bank South Pacific (BSP). The prisoner and Tony Dunstan were assisted by their lawyer, Karen Rema of Pang Legal Services and the banks inhouse lawyer Robin Kawat to withdraw the monies from the Moga ILG account.

3.	At the time of the commission of the offence, the prisoner was not the authorised person to withdraw any monies, dispose of or deal with the Moga ILG account however the prisoner applied to have another Moga Land Group recognised. This was to enable him and Tony Dunstan to access and withdraw monies. The prisoner and Tony Dunstan did this by falsely producing to the Bank South Pacific a Certificate of Recognition. This Certificate of Recognition recognised the prisoner as the Chairman of the ILG which therefore gave him the authority to withdraw the monies from the account. They then successfully withdrew monies from the account to a total of K436,000.00

4.	During the commission of the offence, the Moga ILG account was frozen under a National Court Restraining Order. The order restrained any persons from withdrawing any monies or dealing with the account. The prisoner and his lawyer Karen Rema knew very well that there were Restraining Orders in place over that account because that same Restraining Order restrained the complainant as well as that of the prisoner. Despite that Restraining Order the prisoner and Tony Dunstan withdrew from the account. They also made a payment of K5,000.00 to their lawyer Karen Rema for her assistance.

5.	Tony Dunstan, Karen Rema and Robin Kawat have never been charged over this incident because I think they bear some responsibility for this.

Issue

6.	The prisoner pleaded guilty to the charge. The court now has to decide the appropriate sentence to impose on him.

7.	Section 383A says:

Misappropriation of Property

(1)	A person who dishonestly applies to his own use or to the use of another person.

(a)	Property belonging to another is guilty of the crime of misappropriation of property.

(2)	An offender guilty of the crime of misappropriation of property is liable to imprisonment for a term not exceeding five years except in any of the following cases when he is liable to imprisonment for a term not exceeding 10 years:— 

(a)	where the offender is a director of a company and the property dishonestly applied is company property; or

(b)	where the offender is an employee and the property dishonestly applied is the property of his employer; or

(c)	where the property dishonestly applied was subject to a trust, direction or condition; or

(d)	where the property dishonestly applied is of a value of K2,000.00 or upwards.

(3)	For the purposes of this section— 

(a)	property includes money and all other property real or personal, legal or equitable, including things in action and other intangible property; and

(b)	a person's application of property may be dishonest even although he is willing to pay for the property or he intends to restore the property afterwards or to make restitution to the person to whom it belongs or to fulfil his obligations afterwards in respect of the property; and

(c)	a person's application of property shall be taken not to be dishonest, except where the property came into his possession or control as trustee or personal representative, if when he applies the property he does not know to whom the property belongs and believes on reasonable grounds that such person cannot be discovered by taking reasonable steps; and

(d)	persons to whom property belongs include the owner, any part owner, any person having a legal or equitable interest in or claim to the property and any person who, immediately before the offender's application of the property, had control of it.

8.	The maximum sentence is usually reserved for the worst type of misappropriation. In this case the maximum sentence the court may impose is 10 years imprisonment. The Supreme Court in Wellington Belawa v State (1988-89) PNGLR 496 determined that the higher the amount misappropriated the higher the sentence. That is a consideration the courts must take into account. I am also of the view that who one steals from should be another consideration. Another consideration is the level of sophistication that should be taken into account. These should in my respectful opinion be considered as aggravating factors that should be considered.

9.	The Supreme Court in the Belawa case said:

(a)	K1-00 to K1,000, a jail term should rarely be imposed.
(b)	K1,000 – K10,000 a jail term of up to 2 years was appropriate.
(c)	K10,000 – K40,000 a jail term of 3 – 5 years was appropriate.
(d)	K40,000 to K150,000 a jail term of 3 – 5 years was appropriate.

The amount misappropriated in this case is K436,000. Under the Belawa formula the prisoner is looking at 5 to 7 years imprisonment.

Personal Particulars

10.	The prisoner is a married man aged 54 years. He is from Mailu area in the Abau District of Central Province. He is now living at the ATS Oro Block in Port Moresby on the other side of the Jacksons International Airport. He has two brothers and 3 sisters still living. He and his wife have 4 children 3 sons and a daughter but one of the sons has died so he now has 2 sons and a daughter. He attained grade 8 level education at Kwikila High School in 1975.

11.	The prisoner is currently unemployed and has no means of income except selling lollies and biscuits at the road side. He makes about K30 to K50 per day and at weekends about K90-00.

12.	The prisoner has no major health issues except that he says he suffers from a Post Traumatic Stress Disorder after he was attacked by a person who hit him with a stone on his head which is unrelated to this case.

13.	The prisoner has no prior conviction. He however is not in any position to repay the money. He pleaded guilty to the charge and co-operated with the police.

Aggravating Factors

14.	He is an educated person of Grade 8 and breached the trust of his people. Further he was a key player in the fraud. He pretended all along as if he was a genuine landowner when in fact he was not. The accounts of the Land Group were frozen by the National Court and the prisoner, Tony Dunstan, Karen Rema and Robin Kawat assisted to withdraw the money. The prisoner took the risk when he agreed to present himself as the authorised person so that the fraud could be successfully completed.

15.	This offence was perpetrated over a period of two months that is between 1st July and 31st August 2012. He and his accomplices carefully planned how the crime would be committed and succeeded in their deceitful ploy. In his Record of Interview he said he gave K5000 to his lawyer Karen Rema as appreciation gift. He did not say how much he gave to his other accomplices, Tony Dunstan and Robin Kawat. In passing I say the police should now hunt Tony Dunstan, Karen Rema and Robin Kawat and have them charged relating to this matter.

16.	 As to what the prisoner did with the money there is no evidence and he does not say how or where he spent the money or where the money is now. But on all counts it appears that all has been used. It is obvious though that the Moga Land Group and the clan members never saw this money. The prisoner and Tony Dunnstan withdrew large amounts of money and of that K5000 was paid to their lawyer Karen Rema for her assistance or in appreciation for her help and K5000 to BSP's lawyer Robin Kawat for arranging the uplift of the freeze. Again I make the call for police to hunt down these other players in perpetrating their crime. How was Karen Rema paid for her services as a lawyer quite apart from the gift of K5,000.00. Could Karen Rema have been paid from that K436,000 for her legal fees?

17.	 The prisoner and his accomplices have not paid any restitution of these ordinary village people's monies. They should be held accountable for the stolen money.

18.	 The prisoner knew about the existence of a National Court order. Karen Rema and Robin Kawat all knew of the restraining order. This is a serious breach of a court order and the lawyers should be charged for contempt of the court orders with the prisoner as well. The National Court order stated that the account of the Moga Land Group was not to be disposed of or dealt with by any person without the consent of the Public Prosecutor. There is no evidence the Public Prosecutor gave a written order or consent for the prisoner Tony Dunstan, Karen Rema or Robin Kawat to withdraw monies from that account. The restraining order of the court dated 17 June 2010 reads:

1.	that the property specified in the schedule herein ("the property") must not be disposed of or otherwise dealt with by any person without the prior written consent of the plaintiff or until further order.

2.	that subject to s.55 of the Proceeds of Crime Act 2005, this order operate until further notice.

3.	that the parties have liberty to apply on 3 days notice.

4.	that the time for sealing of these orders be abridged to the time of settlement by the Registrar which shall take place forthwith.

19.	The restraining orders appear to have been made under s.40 and s.41 of the Proceeds of Crimes Act. If Mr Kawat and Ms Karen Rema wanted the restraining orders to be lifted or set aside they were at liberty to do so on application and on a 3 day notice as required under the restraining orders. Instead they were writing letters and giving opinion on s.55 of the Proceeds of Crime Act. They ought to have made the appropriate applications under s.55 of the Proceeds of Crime Act and allow the court to rule on the issue. The bank officer was negligent in allowing a court order to be set aside in this way rather than by another court order lifting the restraining order.

20.	The monies remain unpaid after the prisoner and the lawyers and Tony Dunstan had dealt with the money. The prisoner now has no way to pay the restitution, thanks to Karen Rema and Robin Kawat.

21.	The prisoner and his accomplices were smart in how their plan was to be successful. Firstly, they colluded with the officers at the Department of Lands and Physical Planning particularly the ILG Registry of the Department to alter the records of the Moga ILG. After this they came up with a new Certificate of Recognition G120 recognising the prisoner as the new chairman of the account. All this was done without the knowledge of the current executives of the Moga ILG.

22.	They then presented this new Certificate of Recognition to Bank of South Pacific convincing them that the prisoner was the new Chairman of the Moga ILG. The prisoner and his accomplices also knew that for the fraud to be successful, the presence of a lawyer was very important to convince BSP that the prisoner was actually the authorised person to deal and withdraw monies from the account.

23.	The lawyer Karen Rema with her interpretation of the Restraining Order and the new Certificate of Recognition enabled them to convince BSP therefore enabled the prisoner and Tony Dunstan to go on a withdrawing spree.

24.	Further, the prisoner and Tony Dunstan with Karen Rema wrote numerous letters to BSP to up lift the freeze. This clearly shows a well planned fraud over a period of 2 months. The plan was well and meticulously orchestrated so that the desired outcome of defrauding the account whilst under a National Court Restraining Order could be achieved.

25.	In the recent matter of State v Mathew Kana CR No 843 of 2012 on the 11th June 2014, the prisoner pleaded to one count of misappropriation and one count of conspiracy to defraud Twivey Lawyers of K164,570.30. His Honor Sakora J sentenced him to 5 years imprisonment.

26.	In the State v Ludwina Tokiapron (2005), the accused pleaded guilty to misappropriation of K200,000.00. In that case, the accused obtained money from the victims on the pretext that the money would be invested in a pyramid scheme in Singapore but the money was never invested, it was used by the accused. The accused was sentenced to 6 years.

27.	In State v Niso (2005) N2930, the accused was found guilty of four charges relating to conspiracy, forgery and uttering. The accused was alleged to have conspired with another person to defraud Bank of Papua New Guinea of K500,000.00. The accused was sentenced to 6 years 10 months.

28.	In the State v Buygonnes Tuse Nae (1996) N1474, the accused pleaded guilty to 14 counts of misappropriation. The amount involved was K103,587.70. The accused was involved in a rural housing scheme and he invited members of the public to become members with membership fees ranging from K50.00 to K200.00. After collecting the money, he used the money, he was sentenced to 4 years imprisonment.

29.	In the matter of State v Pongowen Popei and Mark Regione CR 659 and 660 of 2012, the prisoner pleaded guilty to one count of conspiracy to defraud and two counts of stealing. I sentenced the two prisoners to 3 years imprisonment for the charge of conspiracy and 4 years imprisonment with hard labour for the charge of misappropriation.

30.	Taking into account all the factors in this matter, the mitigating and aggravating factors and the comparative verdicts on sentence, I sentence the prisoner to six years imprisonment with hard labour.

______________________________________________________________

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