State v Guli [2017] PGNC 145; N6839 (14 August 2017)

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CRIMINAL LAW – Practice and Procedure – Charge of misappropriation – S.383A (1) of Criminal Code Act – dishonest procuring of money – resulted in dishonestly application of the money.

State v Gabriel Ramoi (1993) PNGLR 390
State v. Francis Laumadava (1994) PNGLR 291

1. SALIKA DCJ: INTRODUCTION: The three men were charged with one count of misappropriation pursuant to S.383A (1) of the Criminal Code Act.

2. Between July and September 2010, the accused, Paul Guli accountant and Gogumi Kimin District Administrator were employed as District Accountant and District Administrator respectively for the Anglimp/South Waghi District, then in the Western Highlands Province but now Jiwaka.

At the material time, various claims were submitted to the District Office by Gogumi Kimin who signed as the authorised requisitioning officer for accused, Andrew Kama Alake to be paid for vehicle hire, road maintenance and travel allowances.

The accused, Paul Guli and Gogumi Kimin as the District Accountant and District Administrator in breach of the Public Finance (Management) Act and Finance Instruction 3C/2008, went on to sign and approve the payment of a sum of K473,575.00 under cheque no. 000999. Out of that K473, 575.00, Andrew Kama Alake received K105, 400.00 for his four claims and both accused persons also paid themselves from this payment under cheque no. 000999 K2, 000 for Paul Guli and K107, 000 for Gogumi Kimin.

The accused, Andrew Kama Alake received another payment of K60, 000 under cheque no. 1075 again for fraudulent claims for another vehicle hire and K10, 000.00 for Independence Celebrations at East Kambia.

All these payments were made from the Anglimp/South Waghi District Services Improvement Program without any approval from the Joint District Planning and Budget Priorities Committee (JDP & BPC).

The State alleged that when the accused, Paul Guli and Gogumi Kimin approved the payment for the K473, 575 for various claims it was in breach of the Public Finances (Management) Act and the Finance Instructions, and when they benefited from the payment they dishonestly applied the money to their own use and to the use of others.

The State alleged that when the accused, Andrew Kama Alake submitted the fraudulent claims and received the payments he dishonestly applied the sum of K165, 400.00 to his own use and the use of others and that the funds were not used for the intended purpose.

The actions of the accused persons, it is alleged by the State contravened Section 383A (1) and (2) of the Criminal Code Act.

A person who dishonestly applies to his own use or to the use of another
person-

The State bears the burden of proof beyond reasonable doubt on each of the elements of the charge.

5. Elements a), b), c), e), f), and g) are not in dispute. The defence admits those elements being proved beyond reasonable doubt. Element d) is the remaining element of the charge that needs to be proved beyond reasonable doubt.

6. The single issue to be determined by the Court is whether the accused dishonestly applied the monies.

EVIDENCE

7. The State called four (4) witnesses; Lambi Kinch, Tau Naime, Alois Warren and Basi Sopata.

Lambi Kinch is the Regional Finance Inspector for the Highlands Region based in Mt Hagen. His role is to oversee and ensure that the Public Finance Management Act, the Finance Instructions and the District Support Improvement Programme Guidelines are adhered to by Public Servants in Departments of the State, Districts and State agencies.

He has a diploma in Accounting and Public Administration and has been doing this type of work for over 30 years now. He was a member of a joint investigation team made up of police fraud investigators, auditor general officers, and finance inspectors from the Department of Finance. The inspections and investigations were carried out in April – May 2013.

8. He said they did go into the Anglimp/South Waghi District Administration and District Treasury offices and obtained payment vouchers and claims for payments and inspected them to see if all claims and payments met the requirements of the Public Finance Management Act and Finance Instructions. He said in their inspections they came upon a claim for K473, 575.00 which did not meet the legal requirements under the Public Finance (Management) Act, Finance Instructions and the District Services Improvement Programmes (DSIP) guidelines.

9. He said that the FF3 (Finance Form 2) was signed by the District Administrator as the authorising officer and as the S32 officer. The District Treasurer signed as the financial delegate and the District Accountant Paul Guli signed as the certifying officer. His main complaint was that the District Administrator Gogumi Kimin had no authority to sign as the Section 32 officer under the PFMA. The District Administrator has the authority to approve up to K50, 000.00 and anything above that must be signed by the Provincial Administrator and in 2010, the Provincial Administrator would have been the Provincial Administrator for the Department of Western Highlands because Anglimp/South Waghi District Office was then part of Western Highlands Province. The State called 3 other witnesses who all corroborated Lambi Kinch’s evidence.

10. The defence called Paul Guli who gave sworn evidence, Gogumi Kimin who gave unsworn evidence and Andrew Kama Alake who also gave unsworn evidence.

11. Paul Guli confirmed signing the claims voucher as the certifying officer but he said he as certifying officer does not authorise payments and that he only signs after the District Administrator signs as the authorising officer and the District Treasurer signs as the financial delegate. He said his signature is obtained last before the cheques are printed out.

12. Paul Guli further explained that there were 20 separate claimants all pressuring them to pay for the service they each provided to the District and needed to be paid. He further explained that while there were 20 separate claimants, there was only one cheque leaf remaining. He said all the claims were put in the one cheque and the cheque was written out in favour of the Bank South Pacific and the payments were then deposited into the bank accounts of each of the claimants.

13. He further explained that the District Administrator, Gogumi Kimin signed as the Section 32 officer because all the little claims totalled K473, 575.00. The District Treasurer signed as the financial delegate and Paul Guli signed as the certifying officer. According to witness Lambi Kinch the District Administrator, the District Treasurer and the District Accountant should never have signed the vouchers because he said this was illegal and a breach of the Public Finance (Management) Act. He said only the Provincial Administrator had the power to authorise this claims. Paul Guli admitted this fact but said none of the little claims were beyond K50, 000.00 and there was only one cheque leaf left.

14. The following were the 20 claimants Paul Guli in his evidence said were pressuring them and their account numbers and how much each was claiming:-

Item	Payee	Account Details	Amount (K)
01	Anna Kaupa	1000909024	55,000.00
02	Peter Onguglo	1000787688	55,000.00
03	Kimen Gokumi	1000793066	55,000.00
04	Kimen Gokumi	1000793066	50,000.00
05	Kimen Gokumi	1000793066	2,000.00
06	John Puri Namba	1001158485	15,000.00
07	Andrew Kama	1001081463	2,400.00
08	Andrew Kama	1001081463	50,000.00
09	Andrew Kama	1001081463	50,000.00
10	Andrew Kama	1001081463	3,000.00
11	Lucas Kungere	1000509266	4,175.00
12	Lucas Kungere	1000509266	2,000.00
13	Paul Kuk P/M	1001279799	15,000.00
14	Paul Kuk P/M	1001279799	2,000.00
15	Paul Guli	1000975780	2,000.00
16	Paul Karib	1000796922	2,000.00
17	Georgina Kama	1001819596	55,000.00
18	Georgina Kama	1001819596	50,000.00
19	Georgina Kama	1001819596	2,000.00
20	Dorothy Kuri	1000899605	2,000.00

Claimants or payees as indicated on the list01,02.06,07,08,09,10,13,14,17,18,19 and 20 are to have been service providers to the Anglimp South Waghi District. Claimants 03, 04 and 05 is the same person and was the District Administrator for Anglimp South Waghi District Kimin Gogumi. All up he received K107, 000.00. Claimant 07, 08, 09, and 10 is the same person and that is Andrew Kama, one of the accused in this case and a community representative on the Joint District Planning and Budget Priority Committee.

Claimant 11 and 12 is the same person and he was the District Treasurer of the Anglimp South Waghi District. Claimant 15 is Paul Guli the District Accountant for Anglimp South Waghi District and one of the accused here.

When one looks at the claimant list there were only 7 claimants. Four of the claimants were employed in the District Administration including the District Administrator. Andrew Kama, one of the claimants was a member of the JDP & BPC of the Anglimp South Waghi District. It is however, clear and obvious to me that the claim vouchers FF3 was improperly approved by Gogumi Kimin the District Administrator as the authorised requisition officer and the Section 32 officer. Lucas Kungere, the acting District Treasurer approved the claim as the financial delegate. The claim for K473, 575.00 was over all their respective financial powers and delegations to have the cheque cashed. The Provincial Treasurer Ben Merenge counter signed it. The cheque was cashed and paid out. The claims were not supported by proper documents, no proper labour lists were provided to ascertain who did what and when. There was no evidence by the very people who worked on those projects to support the story of Gogumi Kimin and Andrew Kama. Those claims to me were all false claims.

15. From observation of the claims the District Treasury became a milking cow for public servants and their cronies. If not arrested this trend will continue. Proper mechanisms need to be worked out or put in place sooner as to how public funds are to be kept safe in the Districts. There are so many false claims rendered for payments in the Districts and the District public servants are all joining in on this K10 million “cake”.

16. There is clear evidence of bypassing proper procurement process and where FF3’s and FF4’s are signed by unauthorised officers then you know something is wrong. The payments of K473, 575.00 was improperly paid. The Department of Works Civil Engineering Division should be on hand to confirm if work was indeed done. The Department of Works engineers should certify that a road project was completed to their satisfaction and that the money was spent on the project. The engineers should also certify the labour lists. In this case all this was lacking. The Government in order to arrest this systemic and systematic misuse of public monies must devise a system where there are checks and balances which are honest and have integrity.

17. Paul Guli’s sworn evidence that the claimants ruined the District Administration building and that they were under pressure is not supported by any other independent witness. The District Administrator Gogumi Kimin gave unsworn evidence about this prosecution as politically motivated. An incoming Governor is entitled to check the District Administration books of accounts to ensure he or she starts on a clean plate so to speak. Mr. Kimin said Dr. Tongamp was retaliating for the arrests of his brother and others. This was never put to the State witnesses and so no weight will be given to his explanation (The Browne v. Dunn 1893) 6 R 67 (HL).

18. Gogumi Kimin explained that the K50, 000.00 and the K55, 000.00 was paid to him so that he could pay to his own people from Sigmigl who worked on the road maintenance projects. He said he got the money and paid them. He called no one from his Sigmigl Village or area who did the road maintenance work and got paid for his or her labour. How then is the Court going to believe his story? His version of the story was never put to the State witnesses. It is very hard to believe that kind of story when it is not supported by independent evidence or a good number of beneficiations of the K105, 000.00 he got.

19. To top it off he got paid K2, 000.00 bonus from the K473, 575.00. There is no good explanation except the explanation that it was overtime payments from the 3% Administration component of the DSIP fund.

20. Andrew Kama also gave an unsworn testimony. He said he did the road maintenance himself and that this was his road. He said my people knew he did the road maintenance work himself and that is why he got paid the cheque. He too did not call any independent witness to support his story. His version of the story was never put to State witnesses.

21. In relation to the other K50, 000.00 claim Andrew said his vehicle was hired by the Anglimp South Waghi District Administration and they hired it for over a year and that the K50, 000.00 was part payment for the hire of the motor vehicle. No other witness Paul Guli or Gogumi Kimin attest to his claim. In fact they were never asked if it was true that the District Office hired his car for more than a year. To me it is mind boggling as to how a District office, a government office can hire a motor vehicle for over a year. Gogumi Kimin never gave any evidence to support Andrew Kama’s story. The question then is did the District hire his vehicle? There is no other evidence that the District Office hired his motor vehicle.

22. He also gave evidence of K10, 000.00 which he said he gave to Max Kove and Yandi Kopun and he said the two men went to East Kambia. He said he was not lying and that if the Court wanted he would bring them to Court. He has been on bail and should have brought them here. It’s too little too late to say if the Court wants them he will bring them. The time for bringing witnesses is over.

23. Out of the total K473, 575.00, Andrew Kama received K105, 400.00. He got paid another K50, 000.00 for another hire car claim and K10, 000 claim for Independence Celebrations. That is why he was charged with misappropriation of K165, 400.00.

24. In his own evidence he blamed the public servants saying all he was doing was getting his vehicle hired out and getting paid. The fact of the matter from the evidence is that he was never appointed by the Chairman of the JDP & BPC as deputy chairman of JDP and BPC or self-appointed. There is certainly correspondence on the vouchers where he signed as Deputy Chairman JDP and BPC. He made the point that he was a grade 3 educated person and does not know the processes. However, records shows that he was an astute businessman having his vehicle hired out and having his claims put through. Whether approval was given to hire his vehicle is not known.

25. There is evidence from the State witnesses that the money was not legally procured. The accused Gogumi Kimin authorised the payments as the S32 officer when he had no authority to do so. When that happened he acted dishonestly to procure the payments. Paul Guli signed as the certifying officer. When he signed he dishonestly did knowing that Gogumi Kimin did not have the authority to authorise that payment.

26. The end result is that Paul Guli and Gogumi Kimin dishonestly procured the money and then dishonestly applied the K473, 575.00 for their own use and the use of others. Iam satisfied beyond reasonable doubt that the K473, 575.00 was dishonestly procured. I am equally satisfied beyond reasonable doubt that they then dishonestly applied the money for their own use and to the use of others. I am satisfied beyond reasonable doubt that they put false claims and that is why the cheque had to be unlawfully processed. Once cleared they applied it for their own purposes.

27. In the State v Gabriel Ramoi (1993) NGLR 390 this court when considering what dishonesty meant said:-

“ [The]” word ‘dishonestly’ in Section 383A of the Criminal Code relates only to the state of the mind of the person who does the act which amounts to misappropriation. The state of mind when a person applies property is a question of fact for the trial judge to determine on all of the facts presented before him. And when the judge considers the facts on how the property was applied, he uses the ‘ordinary standards of reasonable and honest people’ test to determine whether or not the property so applied was dishonestly applied. ‘Dishonest’ is defined in the Oxford Advanced Learners Dictionary of Current English as “intended to cheat, deceive or mislead.”

28. In the State v. Francis Laumadava (1994) PNGLR 291 Injia (as he then was) said:

“The Court must look into the mind of the accused and determine whether, given his intelligence and experience, he would have appreciated as right minded people would have done that what he was doing was dishonest.”

29. In considering the evidence as it unfolded before me and given the tests to be applied, that is the reasonable and honest people test and given their intelligence and experience whether they would have appreciated, as a right minded person would have done, that what they were doing was dishonest and having considered and discussed all that evidence I am in no doubt using the ordinary standards of reasonable and honest people test that they knew what they were doing was dishonest.

30. I consider that according to the ordinary standards of reasonable honest people of PNG, what the 3 men did was dishonest. I am of the opinion that they must have known that their conduct and actions were dishonest. They knew and ought to have known that ordinary people would consider their conduct and actions as dishonest especially Paul Guli and Gogumi Kimin when they signed the FF3 as the S32 officer and the certifying officer.

31. Applying the relevant test, I am sure the three men were acting dishonestly because I see no reason why a men of their intelligence, experience and positions as the District Accountant, the District Administrator, the Deputy Chairman of JDP and BPC would not have appreciated, as right minded people would have done, that what they were doing was dishonest and wrongful conduct. Accordingly, I am satisfied beyond reasonable doubt that their actions and conduct were dishonest and find them each guilty on the charge of misappropriation.

32. In the end result I am also satisfied beyond reasonable doubt that Andrew Kama dishonestly applied the K165, 400.00 to his own us and to the use of others.

33. Accordingly, the end result is that I am satisfied beyond reasonable doubt that each of the accused is guilty as charged.

Ruled accordingly.
_______________________________________________________________
The Public Prosecutor: Lawyer for the State
The Public Solicitor: Lawyer for the Accused

National Court of Papua New Guinea

State v Guli [2017] PGNC 145; N6839 (14 August 2017)