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State v Wai [2020] PGNC 14; N8182 (7 February 2020)

N8182


PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]


CR (FC) 76 OF 2016


THE STATE


V


JOSEPH WAI


Waigani: Berrigan, J
2019: 7th, 9th August, 1st October
2020: 7th February


CRIMINAL LAW – PRACTICE AND PROCEDURE –Indictment not defective for failing to state provision number - S. 407(1)(b) of the Criminal Code –Conspiracy to defraud – State not precluded from proceeding against one accused conspirator - Elements of the offence – Inchoate offence– S.383A of the Criminal Code – Misappropriation - Elements of the offence – Meaning of “applied to own use”.


CRIMINAL LAW – EVIDENCE - Co-conspirators Rule


The accused was charged with one count of conspiracy to defraud and one count of misappropriation, contrary to s. 407(1)(b) and s. 383A(1)(a)(2)(d) of the Criminal Code, respectively. At trial the evidence showed that together the accused and two of his alleged co-conspirators, Henry Mathias and Ernie Choi, told the complainant that they were experienced commodity traders and that they would purchase her goldbar, weighing about 781 grams, for K105,340.50 and take it to Australia for sale. The accused held himself out as the Chief Executive Officer (CEO) of ANZ when he was in fact the CEO’s driver. Meetings with the complainant were conducted in the back of a vehicle in public car parks. On each occasion the accused arrived separately in an executive vehicle. Ernie Choi was introduced as a broker. Henry Mathias was introduced as a consultant to “Yakandi Global Marketing Pty Limited”, an agent for the ABC Refinery in Australia. The written purchase agreement for the gold, however, was with neither Yakandi Global Marketing Pty Limited nor ABC Refinery but with the “Verepo Commodity Agency”, which was brought into the arrangement not by either the “broker” or the “agent” but by the accused and of which the accused’s first wife, Kila Verepo, was the Managing Director. It was the accused who produced the purchase agreement and he who signed as the Managing Director of Verepo Commodity Agency, when he was not. Ernie Choi and Henry Mathias also signed the agreement as representatives of the Verepo Commodity Agency. Upon the complainant’s insistence the accused arranged for Kila Verepo to sign the agreement. On the basis of the agreement the complainant handed over her gold to the accused. The accused gave the gold to Henry Mathias. On Sunday, 8 November, Henry Mathias called the complainant and told her that something had gone wrong with the sale of the gold in Australia. The following day he gave the complainant a copy of an email purportedly from the ABC Refinery, referring to an advance of “$28k” for a gold bar in the weight of 781.64 gms. Three days later the complainant met with Henry Mathias, the accused and Kila Verepo. The accused told the complainant that they had only received 28,000 Kina from the sale in Australia and offered to settle the deal for 20,000 Kina. (On the exchange rate at the time, an advance of “$28k” or AUD28,000 would have been equivalent to about PGK58,800.)The complainant refused to accept the proposal. The accused then told her they would pay her when they sold more gold they were expecting but thereafter refused to take her calls. Other than K5000 the accused gave her to support her stay in Port Moresby after she reported the matter to police,the complainant never received any money for her gold.


Held:


As to Count 1:


  1. The indictment was not defective for failing to identify the section number of the Criminal Code under which the alleged charge was brought. Neither s.528 of the Criminal Code nor Order 3 Rule 2 of the Criminal Practice Rules contain any such requirement. The charge was one brought pursuant to a written law for the purposes of s. 37(2) of the Constitution.Any objection to quash the indictment should have been made pursuant to s. 558 of the Criminal Code prior to arraignment.
  2. The State is not precluded from proceeding on a charge of conspiracy against a single accused: The State v Tanedo[1975] PNGLR 395; R v Shannon [1974] 2 All ER 1009; R v Darby [1982] HCA 32; (1982) 148 CLR 668 considered. It is a matter for the Public Prosecutor and his office in controlling the prosecution function of the State to determine whether, and if so on what charges, proceedings are brought against any individual in the National Court: The State v Ngasele (2003) SC731. Ultimately, the issue for determination is whether the State has established its case of conspiracy against the accused beyond reasonable doubt.
  3. To establish the offence of conspiracy to defraud contrary to s. 407(1)(b) of the Criminal Code the State must prove the following elements beyond reasonable doubt:
  4. To defraud means:

Roland Tom and Kalen Kopen v The State (2019) SC1833 (Scott v Metropolitan Police Commissioner [1974] UKHL 4; [1975] AC 819; Peters v The Queen [1998] HCA 7; (1998) 192 CLR 493 adopted and applied; Potape v The State (2015) SC1613 clarified).


  1. Conspiracy is an inchoate offence which is complete upon the entry into an unlawful agreement, express or implied, which need never be implemented: Roland Tom (supra); The State v Iori Veraga (2005) N2849; R v Aspinall (1876) 2 Qu D 48. It is complete without the doing of any act save the act of agreement: R v Rogerson [1992] HCA 25; (1992) 174 CLR 268 at 279.
  2. The prosecution must, however, prove not only an agreement between the alleged conspirators to carry out an unlawful purpose (or a lawful purpose by unlawful means) but also an intention in the mind of any alleged conspirator to carry out the purpose: Tanedo (supra); R v Thomson (1965) 50 Cr App R 1.
  3. There is no need to establish the existence of meetings, nor a formal,nor even an express agreement: see Roland Tom (supra).
  4. Evidence of acts following the agreement (overt acts) may be, and often is, the only available proof that the agreement was made; but it is the agreement and not the evidence that constitutes the offence: see Veraga (supra);R v Gudgeon [1995] QCA 506; (1995) 133 ALR 379.
  5. Conspiracy is a continuing crime. It extends over the period of the agreement until it is achieved or terminated: Roland Tom; Veraga (supra).
  6. It remains a single conspiracy no matter who joins or leaves it, as long as there are at least two persons at any one time acting in combination to achieve the same criminal objective: Veraga; R v Masters (1992) 26 NSWLR 450.
  7. The conspirators may join in the conspiracy at various times; any one of them may not know all the other parties, but only that there are other parties; and any one may not know the full extent of the scheme to which he attaches himself; but each alleged conspirator must know that there is in existence a scheme which goes beyond the illegal acts which he agrees to do and must attach himself to that scheme: Veraga (supra); R v Griffiths [1966] 1 QB589.
  8. In a conspiracy to defraud, the agreement must be one to bring about a result by dishonest means but those means need not necessarily involve deception. Dishonesty of any kind is enough: Scott v Metropolitan Police Commissioner [1975] AC819.
  9. Ordinarily, acts done or words uttered in the absence of an accused will not be admissible against them. This is subject to the “co-conspirators rule”, which applies in any case where two or more persons are bound together in the pursuit of an unlawful object. Evidence of the acts and declarations of alleged co-conspirators outside the presence of an accused may be led against him in order to establish the existence, nature and extent of the conspiracy. Once there is evidence of the accused’s “reasonable participation” in the alleged conspiracy, the acts and declarations of alleged co-conspirators made in furtherance of the common design may also be used to prove the accused’s participation in the agreement alleged: Ahern v R [1988] HCA 39; [1988] 165 CLR 87, applying Tripodi v The Queen [1961] HCA 22; (1961) 104 CLR 1, adopted and applied. See also Tanedo (supra).
  10. The evidence established that the entire transaction wasa sham. The accused and his co-conspirators, Ernie Choi, Henry Mathias and Kila Verepo, conspired to defraud the complainant, that is they agreed:
  11. At the time the accused agreed to use dishonest means to defraud the complainant he intended to carry that objective into effect.
  12. The means agreed to deprive the complainant of her gold were dishonest according to the ordinary standards of honest and reasonable people. Having regard to those standards, the accused must have in fact known that the agreed means were dishonest: Havila Kavo v The State (2015) SC1450; Wartoto v The State (2019) SC1834 applied.
  13. Furthermore, the accused knew that he had no right to deprive the complainant of her gold.
  14. The accused is convicted of conspiracy to defraud contrary to s. 407(1)(b) of the Criminal Code.

As to Count 2:


  1. To establish the offence of misappropriation contrary to s. 383A of the Criminal Code the prosecution must prove beyond reasonable doubt that the accused:

Havila Kavo v The State (2015) SC1450.


  1. At the time the accused gave the gold to Henry Mathias he applied it for his own use, that is for the purpose of putting into effect the conspiracy to deprive the complainant of the gold without paying the agreed price. In particular, he diverted the gold from the purpose of the person to whom it belonged, namely the complainant, who provided it for the purpose of receiving K105,340.50 as agreed. See R v Easton [1993] QCA 255; [1994] 1 Qd R 531.
  2. The gold was property for the purposes of s. 383A(3)(a) of the Criminal Code, being tangible property.
  3. The property belonged to the complainant for the purposes of s.383A(3)(d) of the Criminal Code. Legal interest in the property did not pass upon the signing of the purchase agreement. The purchase agreement was voidable for being induced by fraud. There was no evidence to show that the “Verepo Commodity Agency” was a legal person capable of ownership. In any event, at a minimum, the complainant retained an equitable interest in the gold until completion of the agreement.
  4. At the time the accused applied the gold to his own use he did so dishonestly according to the ordinary standards of reasonable and honest people. Furthermore, having regard to those standards, the accused must have realised that his conduct was dishonest: Havila Kavo; Wartoto(supra) applied.
  5. The accused is convicted of misappropriation contrary to s. 383A of the Criminal Code.

Cases Cited:
Papua New Guinea Cases


Havila Kavo v The State (2015) SC1450
Joseph Wai v The State (2018) SC1720
Maladina v The State (2016) SC1495
Paulus Pawa v. The State [1981] PNGLR 498
Potape v The State (2015) SC1613
Roland Tom and Kalen Kopen v The State (2019) SC1833
The State v Iori Veraga (2005) N2849
The State v Joseph Wai (2019) N7897
The State v Tanedo[1975] PNGLR 395
The State v Tom Morris [1981] PNGLR 493
Wartoto v The State (2019) SC1834


Overseas Cases


Ahern v R [1988] HCA 39; [1988] 165 CLR 87
Peters v The Queen [1998] HCA 7; (1998) 192 CLR 493
R v Darby [1982] HCA 32; (1982) 148 CLR 668
R v Devenport and Pirano [1996] 1 Cr App R 221
R v Easton [1994] 1Qd R 531
R v Gudgeon [1995] QCA 506; (1995) 133 ALR 379
R v Masters (1992) 26 NSWLR 450
R v Rogerson [1992] HCA 25; (1992) 174 CLR 268
R v Shannon [1974] 2 All ER 1009
R v Thomson (1965) 50 Cr App R 11 (or 1?).
Scott v Metropolitan Police Commissioner [1974] UKHL 4; [1975] AC 819
Tripodi v The Queen [1961] HCA 22; (1961) 104 CLR 1
The Queen v Baden-Clay [2016] HCA 35; (2016) 258 CLR 308


References Cited


Sections 383A, 407(1)(b), 525, 528, 558 of the Criminal Code
Order 3, Rule 2 of the Criminal Practice Rules


Counsel


Ms T. Aihi, for the State
Mr R. Yanson, for the Accused


DECISION ON VERDICT

7th February, 2019


  1. BERRIGAN J: The matter comes before me having been remitted to the National Court for a new trial following a successful appeal against conviction to the Supreme Court by the accused: Joseph Wai v The State (2018) SC1720.
  2. I refused leave for the State to amend the indictment for the reasons set out in The State v Joseph Wai (2019) N7897. A trial accordingly proceeded on one count of conspiracy to defraud and one count of misappropriation, contrary to ss. 407(1)(b) and 383A(1)(a)(2)(d) of the Criminal Code (Ch. 262) (the Criminal Code) respectively, such that between 31 October 2015 and 30 November 2015 the accused:

Count 1: “... conspired with one Ernie Choi, Henry Mathias and Kila Verepo to defraud one Anna Sani by stating to her that they would buy 781.2 grams of gold from her for ... K105,340.50”.


Count 2: “dishonestly applied to his own use and to the use of others property belonging to one Anna Sani namely 781.2 grams of gold valued (at) ... K105,340.50” .


State Case


  1. The complainant, Anna Sani, gave evidence for the State as effectively its only witness. (I refused admission of the accused’s record of interview through the investigating officer as police failed to properly administer the accused’s Constitutional rights.)
  2. The complainant impressed me as a credible and reliable witness. Whilst it is fair to say that she might be described as unsophisticated, she was nevertheless, very clear about her dealings with the accused and his alleged co-conspirators.
  3. On the complainant’s evidence I find the following facts established.
  4. Anna Sani runs her own business, a stationary store, in Wewak, East Sepik Province. In late October/early November 2015 the complainant was looking to sell 903.2 grams of raw gold. Her son, Gledwin, told her that he had found a buyer and she came to Port Moresby where she met Philip Drang. Together with her son she went to the ANZ car park at Harbourside. There Philip Drang introduced Ernie Choi to her as a broker. She and her son were invited to get into a blue 10-seater vehicle. Inside the vehicle Ernie Choi introduced the accused to her as the Chief Executive Officer (CEO) of ANZ. Henry Mathias was introduced as a consultant to Yakandi Global Marketing Pty Limited, an agent for the ABC Refinery in Australia. Ernie Choi told the complainant in the presence of the accused and Henry Mathias that they were commodity exporters and that they export gold in 5.5 kg amounts. They told her that they would top up her gold with 6 kilos of gold they were expecting on Monday from a woman from Buka. They also told her they would pay K150 per gram of gold. At their direction the complainant went to William Chan’s office at Hohola to smelt the gold: Exhibit A is photograph of the gold. After smelting the weight of the gold was 781.6 grams.
  5. On Monday, 2 November, the complainant and her son returned to the ANZ car park at Harbourside where they met again with Ernie Choi and Henry Mathias in the 10-seater vehicle. The accused drove into the car park in an executive vehicle, parked in the VIP car park and then joined them in the 10-seater. He told the complainant to take the gold to Golden Valley, a business, in Waigani, to get an assay report (as to purity). The accused left them and Ernie Choi, Henry Mathias, the complainant and her son all went to Golden Valley, where the complainant was given a verbal assay report that the gold was 90% pure.
  6. After that they went to the international car park at Jacksons Airport.The accused drove in to the car park in an executive vehicle and again joined them in the 10-seater. He showed the complainant a “Gold Sales Purchase Agreement” between Verepo Commodity Agency and herself for K105,340.50: Exhibit B. The complainant signed the agreement. The accused signed for Mrs Verepo Kila, Managing Director of Verepo Commodity Agency. The complainant queried why he was signing as such and on her insistence, the accused said that he would get his wife to sign the agreement. Henry Mathias and Ernie Choi also signed the agreement as “Buyers Rep”s and as “H.O.M. Austrailia (sic)” and “Brooker PNG” (sic), respectively.
  7. The complainant then travelled with her son, Ernie Choi and Henry Mathias in the 10-seater vehicle to ANZ Harbourside. The accused arrived separately in another vehicle and parked in the VIP car park.The accused produced the agreement now signed by Kila Verepo. The complainant gave the accused the gold bar. He told her he would keep it in his safe in ANZ and give it to Henry Mathias to sell to the ABC Refinery. He took the gold and went into ANZ.
  8. A few days later on Sunday, 8 November 2015, Henry Mathias rang the complainant and told her that the gold had been sold to “Yakandi Commodity Marketing”. He also told her that the monies had been deposited to the bank account of the Verepo Commodity Agency. On Monday the complainant met with Henry Mathias. He told her that he took the gold to Australia but something went wrong and that they could not pay as agreed. He gave her a copy of an email purportedly from ABC Refinery to robertlepatu@gmail.com;t.lepatu@optusnet.com.au: Exhibit C. It states, in part:

“Dear Robert

We confirm receipt of the following job:

Date received: 5-Nov-15

ABC Reference: 12622

Incoming Weight: 781.64 grams

Description: Scrap bar

Refine/Assay for: Au, Ag

Additional Notes: Exp 90%+ Fine Gold at $49.90/g Note advance price only – not locked in. Adv $28k

Est. Result Date: 12-Nov-15”


  1. Henry Mathias told her that she would get her money in three days when it cleared.
  2. Three days later Henry Mathias called her and told her to meet the accused and Kila Verepo at the ANZ car park in Waigani. The accused arrived at the car park in a white double cab Hilux. The complainant and her son got into the vehicle with the accused, Kila Verepo and Henry Mathias. The accused told the complainant that they only received K28000 into the bank account and that they would pay her K20,000. The complainant refused to accept the proposal because the amount agreed was K105,340.50. The accused then told her that they were getting more gold from someone else and when they sold that they would repay her.
  3. The complainant tried to contact the accused on numerous occasions but he refused to take her calls.
  4. The complainant reported the matter to police. The accused and Kila Verepo were arrested. At Gordons Police Station the accused gave her K5000 as “mobilisation” money to assist her meet the costs of staying in Port Moresby whilst she waited for her money. She asked him if he was going to deduct it from the final payment. He said he would not and she accepted it because staying in Port Moresby was expensive. She never received any other money.
  5. To date, other than the K5000 referred to above, the complainant has not received any money for the sale of her gold.
  6. The complainant identified the accused in court as Joseph Wai and the person introduced to her as the CEO of ANZ.
  7. Other than to question her belief that the CEO of ANZ Bank would sell gold on the street, the complainant’s evidence was not challenged under cross-examination. She maintained that she did hold that belief. Similarly, whilst she agreed that she sold the gold to the Verepo Commodity Agency and not the accused, she maintained that the accused was its representative, together with his alleged co-conspirators.

Defence Case


  1. The accused, Joseph Wai, gave evidence in his own defence. He said that he did not know the complainant until she “brought the gold to me”. Nor did he know Ernie Choi before the events the subject of these proceedings either. He has never dealt with gold dealers “in his life time”. He knows Henry Mathias. He is a family friend who asked for his help.
  2. It must be said that at times the accused’s evidence was difficult to follow and at others it was contradictory. The effect of his evidence was that he was simply helping Henry Mathias and Ernie Choi by witnessing the purchase agreement, safe keeping the gold overnight and giving it to Henry Mathias at the airport in front of the complainant. Henry Mathias took the gold to Australia.
  3. He told the complainant that commodity prices “always change”and to be patient, that they would transfer her money and she would receive her share. He told her to follow up with Henry Mathias for her payment. He also said that Henry Mathias and the complainant were in contact with each other whilst Mathias was in Australia. He told Henry Mathias he had to sort things out with the complainant.
  4. Under cross-examination the accused agreed that he was not the CEO of ANZ but was in fact the CEO’s driver. He denied telling the complainant that he was the CEO or that Ernie Choi told the complainant that in front of him.
  5. He confirmed that he has no experience in the buying and selling of gold or other commodities. He was not involved in selling or trading the complainant’s gold. His only role was to keep the gold in a safe place and pass it to Henry Mathias at the airport.
  6. He initially said that he did not know who prepared the purchase agreement but later said that Henry Mathias and Ernie Choi prepared the agreement. He also initially said that he was not aware of the Verepo Commodity Agency but later agreed that he was aware of the agency and that his former wife, Kila Verepo, was its Managing Director. Furthermore, because the complainant had no bank account and they were looking for a way to transfer the funds from Australia, it was he who introduced them to Kila Verepo so that the funds could be transferred into the agency’s account.
  7. He denied that he gave the complainant the purchase agreement to sign. Ernie Choi and Henry Mathias gave her the agreement. He agreed that they were all together when the agreement was signed. He initially said that he signed the agreement because Henry Mathias and Ernie Choi asked him to witness it, but later said that he signed the agreement because he was the one holding the complainant’s gold. He had no role or interest in the Verepo Commodity Agency. When he signed as the agency’s representative, he was just helping.
  8. He put the gold in a safe place in his drawer at the ANZ bank because the gold would not be safe in his home. His involvement stopped when he gave the gold to Henry Mathias to take to Australia.
  9. He told the complainant that Henry Mathias would take the gold to Australia and that she should communicate with him. He said he was aware that Henry Mathias called the complainant from Australia. He doesn’t know what happened with the gold in Australia.
  10. He told Kila Verepo to pay the complainant. He denied telling the complainant that they received money for the gold. He said that he knew that the money had gone into the account of Kilion Flower, another business associated with Kila Verepo. Then he said he didn’t know.
  11. He knew that payment for the gold was received because Henry Mathias called from Australia. That is all he knows. He told Kila Verepo to pay the complainant. Kila Verepo told him that she paid but he doesn’t know.
  12. He received a commission of K2500 for keeping the gold. He told Henry Mathias and Ernie Choi to pay the complainant back because he wasn’t involved.
  13. He denied giving the complainant K5000 mobilisation fees. Henry Mathias and Ernie Choi gave her that money.
  14. In my view the accused was an unimpressive witness. Having heard and observed the accused I am unable to accept him as a witness of truth. This is based on my assessment of his demeanour when giving evidence together with the content of that evidence. There were numerous inconsistencies and contradictions in his evidence. I find the reasons given for, and his evidence as to the extent and nature of, his involvement with the gold and his alleged co-conspirators implausible.
  15. I make it clear, however, that the accused gave evidence although he was not obliged to do so. By entering the witness box and giving evidence he did not take upon himself any obligation to prove anything in this trial. That burden remains with the State.

CONSPIRACY
Failure to Identify Specific Offence Provision in the Indictment


  1. Defence counsel submits that as to the charge of conspiracy, the indictment is “not specific as to the specific law or provision under which the Defendant is charged”. Counsel has not identified on what basis the objection is made, the impact of it on his client if sustained, nor what relief should follow. No statutory provisions or authorities were provided in support of the submission.
  2. The objection appears to be one relating to form. Any objection to quash the indictment should have been made pursuant to s. 558 of the Criminal Code prior to arraignment. There is nothing before me to suggest that the accused sought to quash the indictment at the first trial. Nor is it referred to in the decision on appeal, nor did he raise the issue at the commencement of this re-trial. Nor has Counsel sought to articulate how the omission would embarrass or prejudice his client, especially at this stage of proceedings. The accused can be under no doubt as to the offence he is being charged with and he confirmed this on arraignment.
  3. Moreover, defence counsel has failed to establish any formal defect in the indictment. Section 528 of the Criminal Code sets out the formal requirements of an indictment for our purposes:

“(1) An indictment shall be intituled with the name of the court in which it is presented, and must, subject to the succeeding provisions of this Division set forth the offence with which the accused person is charged–

(a) in such a manner; and

(b) with such particulars as to–

(i) the alleged time and place of committing the offence; and

(ii) the person (if any) alleged to be aggrieved; and

(iii) the property (if any) in question,

as is necessary to inform the accused person of the nature of the charge.

(2) Subject to Subsections (3) and (4), if any circumstance of aggravation is intended to be relied on it must be charged in the indictment.

(3) Where the circumstance of aggravation intended to be relied on is a previous conviction...

(6) It is sufficient to describe an offence in the words of this Code or the other written law defining it.

(7) The place of trial shall be named in the margin of the indictment.”


  1. Section 528(6) of the Criminal Code reflects the need for an accused person to be charged with an offence which is defined by a written law: s. 37(2) of the Constitution.
  2. Order 3, Rule 2 of the Criminal Practice Rules states that every indictment shall be in accordance with Form 1. Order 3 Rule 3(a) provides that the statement of the offence shall be in the applicable form in Schedule 2.
  3. Neither the Rules nor s. 528(1) of the Criminal Code require the particular offence provision or section number to be stated in the indictment. Whilst there would be nothing to prevent the State from doing so, the indictment has been presented in accordance with longstanding practice in this jurisdiction.

Trial of a Single Conspirator


  1. Defence counsel submits that for the charge of conspiracy to succeed “there should be more than one Defendant (co-offenders)”. Once again,Counsel has raised the objection at a very late stage of the proceedings and has failed to outline the basis of the objection, refer to any authority in support of it, or identify the relief sought.
  2. A related issue was considered by Prentice DCJ in The State v Tanedo [1975] PNGLR 395 in which the defence objected to the admission of the testimony of one alleged co-conspirator, who had been given immunity by the State, against the other. An objection was taken on the basis of ancient English authority to the effect that where two persons are charged with conspiracy together, and one is acquitted, the other cannot be found guilty.
  3. Prentice DCJ rejected the defence contention and admitted the evidence. It is not necessary to restate his detailed consideration of the historical reasons for the old rule. As he observed, however, the House of Lords in R v Shannon [1974] 2 All ER 1009 has since held that the rule is obsolete and that where one of two alleged conspirators had been fairly and properly tried and convicted there is no reason why his conviction should be invalidated if for any reason the other alleged conspirator is acquitted on a subsequent trial. The High Court of Australia held in similar terms in R v Darby [1982] HCA 32; (1982) 148 CLR 668.
  4. It follows that alleged conspirators need not be tried together. Furthermore, where two persons are tried jointly as conspirators it does not inevitably follow that both must be convicted or both must be acquitted: see R v Holmes [1980] 1 WLR 1055 and King v R [1986] HCA 59; (1986) 161 CLR 423. See also the discussion in Archbold (2015) at [33-70] and Carter’s Criminal Law of Queensland, 20th Edition at [s 541.35].
  5. The defence also objected to the receipt of the evidence in Tanedo on the basis of fairness, i.e. it was unfair for the prosecution to proceed against only one of two alleged conspirators. In refusing the objection on this basis too, Prentice DCJ expressed the view that State authorities have to weigh the desirability of at least securing some convictions where many are alleged to have offended in concert, and he assumed that the Public Prosecutor had properly considered the alternatives in that light.
  6. The argument was not articulated in terms of fairness in this case. Nor am I aware of whether any of the alleged co-conspirators were ever charged with the accused.
  7. Furthermore, whilst it may be desirable for two or persons alleged to have been involved in a conspiracy to be charged and tried together as a general proposition, it is well established that it is a matter for the Public Prosecutor and his office in controlling the prosecution function of the State to determine whether, and if so on what charges, proceedings are brought against any individual in the National Court. The Public Prosecutor has an absolute power to prefer and present whatever charge he considers the State will be able to prove against an accused. That power is not subject to any direction or control from or by anybody. Section 525(1)(a) of the Criminal Code gives him that power: The State v Ngasele (2003) SC731.
  8. There are a number of considerations that must be taken into account by the State in making such a determination. In this regard it should be borne in mind that charging at the initial stage is a matter for police.
  9. Ultimately, the issue for determination on any trial remains whether the State has established its case against the accused beyond reasonable doubt.

Elements of Conspiracy


  1. In Roland Tom and Kalen Kopen v The State (2019) SC1833, the Supreme Court set out the elements of the offence of conspiracy to defraud contrary to s. 407(1)(b) of the Criminal Code (Ch. 262) (Scott v Metropolitan Police Commissioner [1974] UKHL 4; [1975] AC 819; Peters v The Queen [1998] HCA 7; (1998) 192 CLR 493 adopted and applied; Potape v The State (2015) SC1613 clarified).
  2. To establish the offence the State must prove beyond reasonable doubt that:
  3. To defraud means:
  4. Conspiracy is an inchoate offence which is complete upon the entry into an unlawful agreement, express or implied, which need never be implemented: Roland Tom at [38]; The State v Iori Veraga (2005) N2849 applying R v Aspinall (1876) 2 Qu D 48. It is complete without the doing of any act save the act of agreement: R v Rogerson [1992] HCA 25; (1992) 174 CLR 268 at 279.
  5. The prosecution must prove, however, not only an agreement between the alleged conspirators to carry out an unlawful purpose (or a lawful purpose by unlawful means) but also an intention in the mind of any alleged conspirator to carry out the purpose: Tanedo (supra); R v Thomson (1965) 50 Cr App R 1.
  6. There is no need to establish the existence of meetings, nor a formal, nor even express agreement: see Roland Tom (supra) at [40].
  7. Evidence of acts following the agreement (overt acts) may be, and often is, the only available proof that the agreement was made; but it is the agreement and not the evidence that constitutes the offence: see Veraga (supra) applying R v Gudgeon [1995] QCA 506; (1995) 133 ALR 379 at 389.
  8. Conspiracy is a continuing crime. It extends over the period of the agreement until it is achieved or terminated: Roland Tom; Veraga (supra).
  9. It remains a single conspiracy no matter who joins or leaves it, as long as there are at least two persons at any one time acting in combination to achieve the same criminal objective: Veraga (supra); R v Masters (1992) 26 NSWLR 450 at 458.
  10. The conspirators may join in the conspiracy at various times; any one of them may not know all the other parties, but only that there are other parties; and any one may not know the full extent of the scheme to which he attaches himself; but each alleged conspirator must know that there is in existence a scheme which goes beyond the illegal acts which he agrees to do and must attach himself to that scheme: Veraga (supra).
  11. In a conspiracy to defraud, the agreement must be one to bring about a result by dishonest means but those means need not necessarily involve deception. Dishonesty of any kind is enough. Lord Diplock in Scott (supra):

“The intended means by which the purpose is to be achieved must be dishonest. They need not involve fraudulent misrepresentation such as is needed to constitute the civil tort of deceit. Dishonesty of any kind is enough”. See also Peters (supra) at [22], [23], [72] and [85].


  1. It is generally accepted that “fraudulent” and “dishonest” may be used interchangeably. See Scott (supra) at 839.

Co-conspirators Rule


  1. Ordinarily, acts done or words uttered in the absence of an accused will not be admissible against them. There is an exception to this at common law which is sometimes referred to as the “co-conspirators rule” (although it applies in any case where “two or more persons are bound together in the pursuit of an unlawful object”: see Ahern v R [1988] HCA 39; [1988] 165 CLR 87 at [8] and [15]).
  2. In the United Kingdom the position at common law (see R v Devenport and Pirano [1996] 1 Cr App R 221 for a recent statement) has been preserved by statute in 2003. See the discussion in Archbold, 2015 at [33-63] et seq.
  3. It is useful to set out at some length the discussion from [5] to [9] and [17] of the High Court of Australia’s decision in Ahern for the purposes of understanding the basis of the rule and its exception to the hearsay rule (emphasis added):


“5. In conspiracy cases a clear distinction is to be made between the existence of a conspiracy and the participation of each of the alleged conspirators in it. Conspiracy is the agreement of two or more persons to do an unlawful act or to do a lawful act by unlawful means and it is the fact of the agreement, or combination, to engage in a common enterprise which is the nub of the offence. This fact can seldom be proved by direct evidence of the making of an agreement and must in almost all cases be proved as a matter of inference from other facts, that is to say, by circumstantial evidence. For this purpose, evidence may be led which includes the acts or declarations of one alleged conspirator made outside the presence of the others provided such evidence is not led to prove against the others the truth of any assertion or implied assertion made by the actor or the maker of the statement.It may take the form of evidence of separate acts or utterances from which the fact of combination might be inferred. Led in that way, it is not hearsay and is not dependent upon some circumstance to take it outside the hearsay rule, such as an implied authority making the acts and words of one the acts and words of the other.

6. Thus it was said in Tripodi, at p.6, that proof of the crime of conspiracy "may well consist in evidence of the separate acts of the individuals charged which, although separate acts, yet point to a common design and when considered in combination justify the conclusion that there must have been a combination such as that alleged in the indictment". For example, it may be possible in a case of conspiracy to commit armed robbery to conclude from the fact that one accused wearing a disguise was present in a bank at the same time as another accused, similarly disguised, was waiting outside the bank in a motor vehicle with the motor running, that both were engaged in a common enterprise to rob the bank. For the purpose of reaching that conclusion it is permissible to use the acts and declarations of each, even in the absence of the other, not as proof of the truth of any assertion or implied assertion of the participation of the other, but as facts from which the combination might be inferred...

7. [I]t is not in all cases that evidence of the separate acts of the alleged conspirators will prove both the fact of combination and their participation. Of course, if the evidence fails to prove a combination at all then that is an end of the matter. But if it proves a combination, although not the participation of an individual alleged to be a conspirator, then the question arises whether there are circumstances in which evidence of the acts and declarations of other participants, outside the presence of the individual, may be led against him, not as separate facts from which, when combined with other facts, an inference of combination may be drawn, but as evidence of his own participation. Evidence of the acts or declarations of others led for this purpose will be led to prove the truth of the assertion or implied assertion contained in those acts or declarations. It would be excluded as hearsay or its equivalent were it not admissible upon some other basis.

8. That basis is provided in an appropriate case by the rule which states that when two or more persons are bound together in the pursuit of an unlawful object, anything said, done or written by one in furtherance of the common purpose is admissible in evidence against the others. The combination implies an authority in each to act or speak on behalf of the others: Tripodi, at p.7. Thus anything said or done by one conspirator in pursuit of the common object may be treated as having been said or done on behalf of another conspirator. That being so, once participation in the conspiracy is established, such evidence may prove the nature and extent of the participation...


17. ... Where an accused is charged with conspiracy, evidence in the form of acts done or words uttered outside his presence by a person alleged to be a co-conspirator will only be admissible to prove the participation of the accused in the conspiracy where it is established that there was a combination of the type alleged, that the acts were done or the words uttered by a participant in furtherance of its common purpose and there is reasonable evidence, apart from the acts or words, that the accused was also a participant.”


  1. In summary, evidence of the acts and declarations of alleged co-conspirators outside the presence of an accused may be led against him in order to establish the existence, nature and extent of the conspiracy. Once there is evidence of the accused’s “reasonable participation” in the alleged conspiracy, the acts and declarations of alleged co-conspirators made in furtherance of the common design may also be used to prove the accused’s participation in the agreement alleged: Ahern v R [1988] HCA 39; [1988] 165 CLR 87, applying Tripodi v The Queen [1961] HCA 22; (1961) 104 CLR 1, adopted and applied. See also Tanedo (supra) adopting Tripodi.
  2. The acts and declarations of co-conspirators made before an accused joined the conspiracy, however, are only admissible against the latter to prove the origin, character and object of the conspiracy and not his participation in it: see R v Masters (1992) NSWLR 450; and the discussion in Archbold ibid.

Circumstantial Evidence


  1. Here, as is often the case, the evidence to establish both the conspiracy and the accused’s participation in it is circumstantial. The principles governing such cases are well established. In a case resting wholly or substantially upon circumstantial evidence, an accused cannot be found guilty unless the prosecution has excluded all rational hypotheses consistent with innocence; that is the guilt of the accused must not only be a rational inference, but the only rational inference in all of the circumstances: Paulus Pawa v. The State [1981] PNGLR 498 approving The State v Tom Morris [1981] PNGLR 493, adoptingBarca v The Queen [1975] HCA 42; (1975) 50 ALJR 108 quoting Peacock v the King [1911] HCA 66; (1911) 13 CLR 619. See more recently Maladina v The State (2016) SC1495.
  2. For an inference to be reasonable it must rest upon something more than conjecture. The bare possibility of innocence should not prevent a finding of guilt: Paulus Pawa v. The State (supra).
  3. The evidence must be considered as a whole and not by a piecemeal approach to each particular circumstance: see Paulus Pawa (supra). The essential elements of the offence must be proved beyond reasonable doubt but it is not necessary for every fact, or every piece of evidence, relied upon to be proved beyond reasonable doubt: see The State v Charles Andrew Epei (supra) considering Shepherd v R [1990] HCA 56; (1990) 170 CLR 573 at [6].
  4. It is not incumbent on the defence either to establish that some inference other than that of guilt should reasonably be drawn from the evidence or to prove particular facts that would tend to support such an inference. Where an accused chooses to give evidence, however, that evidence may narrow the range of alternative hypotheses reasonably available upon the evidence: see The State v Charles Andrew Epei and The Queen v Baden-Clay [2016] HCA 35; (2016) 258 CLR 308.

Conspiracy - Analysis


  1. Having regard to the elements of the offence set out at [49] and [50] above, I am satisfied beyond reasonable doubt that there was a conspiracy, that is an agreement between two or more persons,namely the accused, Henry Mathias, Ernie Choi and Kila Verepo, to defraud the complainant.
  2. In particular, I am satisfied beyond reasonable doubt that the accused and his alleged co-conspirators, Ernie Choi, Henry Mathias and Kila Verepo, agreed to defraud the complainant, that is they agreed:
    1. to deprive a person, namely the complainant, of property which was hers, namely 781.2 gms of gold;
    2. by using dishonest means, that is by stating to her that they would pay K105,340.50 for the gold when they had no intention of doing so;
    1. knowing that they had no right to deprive the complainant of that gold.
  3. In my view the entire transaction was a sham executed in pursuance of the conspiracy. The conspirators never intended to pay the agreed price. In this case the means by which the co-conspirators agreed to defraud the complainant were both dishonest and deceitful.

Existence of, and nature and purpose of agreement


  1. In reaching this conclusion I have taken into account all of the findings of fact I made on the complainant’s evidence and set out above, including in particular the following facts and circumstances, which go to establish both that there was an agreement, and the nature and purpose of the agreement.
  2. The accused and his alleged co-conspirators, Henry Mathias and Ernie Choi, acted together. The three of them met with the complainant on at least three occasions. Together they directed the complainant to smelt her gold and to obtain an assay report as to purity.Together they represented to the complainant that they were experienced commodity traders when they were not. Together they told the complainant they would purchase her gold for K105,340.50 and take it to Australia for sale.
  3. By the accused’s own admission he had no experience in buying and selling gold. The accused was introduced by Ernie Choi as the CEO of ANZ, when he was in fact the CEO’s driver. The accused made no attempt to correct the statement. The first meeting was conducted in the ANZ car park at Harbourside, where the accused arrived separately in an executive vehicle and parked in the VIP car park. On each occasion the accused arrived in a separate vehicle. The accused told the complainant that he would keep the gold in the safe at ANZ. All of this was designed to bring credibility to the claim that he was the CEO of ANZ, and that he and his co-conspirators were commodity traders.
  4. The evidence also excludes any rational inference that Ernie Choi or Henry Mathias were commodity traders. Meetings were conducted in the back of a 10-seater vehicle in public car parks. Ernie Choi was introduced as a broker. Henry Mathias was introduced as a consultant to “Yakandi Global Marketing Pty Limited”, an agent for the ABC Refinery in Australia. The purchase agreement, however, was with neither Yakandi Global Marketing Pty Limited nor ABC Refinery but with the Verepo Commodity Agency, which was brought into the arrangement not by either the “broker” or the “agent” but by the accused and of which the accused’s first wife was the Managing Director.
  5. I note here that the nature of the “Verepo Commodity Agency” is unclear, i.e. it is unclear whether it is an incorporated company, or even a registered business name.
  6. The written agreement to purchase the gold, Exhibit B, was produced by the accused, and signed by him and all of his alleged co-conspirators, Ernie Choi, Henry Mathias and Kila Verepo.
  7. The accused signed as the Managing Director of Verepo Commodity Agency. Ernie Choi and Henry Mathias also signed the agreement. They did so as “Buyers Rep”s, i.e. representatives of the Verepo Commodity Agency. Upon the complainant’s insistence the accused arranged for Kila Verepo to sign the agreement.
  8. The purchase agreement itself is a dubious document. It is riddled with spelling errors and inconsistencies, and appears to be an agreement for the supply and purchase of gold in 5 or 10 kg amounts on a monthly basis for a period of 12 months, with only the amount modified to reflect the agreement with the complainant.
  9. On execution of the purchase agreement the complainant handed over the gold to the accused. The accused told the complainant he would keep it in his safe in ANZ.
  10. By his own admission the accused gave the gold to Henry Mathias.
  11. On Sunday, 8 November, Henry Mathias called the complainant and told her that something had gone wrong with the sale in Australia. The following day he met with the complainant and gave her a copy of an email purportedly from the ABC Refinery, referring to an advance of “$28k” for a gold bar in the weight of 781.64 gms, Exhibit C.
  12. At the time I admitted Exhibit C I did so on the basis that it was admissible as the document that Henry Mathias gave to the complainant. On the face of it, it appears to be a photocopy of an email that has been cut and paste on to a letterhead in the name of “Yakandi Bookkeeping Solutions”. By itself that is a very different type of business from “Yakandi Global Marketing”, of which Henry Mathias was meant to be an agent.
  13. Furthermore, the email is purportedly from the ABC Refinery to robertlepatu@gmail.com and t.lepatu@optusnet.com.au. There is no reference to the Verepo Commodity Agency nor anyone else who dealt with the complainant. The weight of the gold bar (781.64 gms), however, matches that belonging to the complainant and the date is consistent with the timeframe in which the complainant provided the gold to the accused.
  14. Whether or not Exhibit C is a genuine copy of an email sent regarding the complainant’s gold, or accurately reflects the amount to be paid as an advance, or even whether further monies were to be paid in addition to the advance (i.e. taking it to $39,003.83 (K81,908.05) at the price of $49.90/g referred to in the email) is beside the point. The evidence shows that the document was used in furtherance of the conspiracy to defraud the complainant. I accept the complainant’s evidence that it was given to her by Henry Mathias when he told her “that something had gone wrong in Australia” and they could not pay her as agreed. Henry Mathias then told the complainant she would get her money in three days when it cleared. Three days later Henry Mathias called the complainant and told her to meet the accused and Kila Verepo at the ANZ car park in Waigani.
  15. At the meeting, and in the presence of Henry Mathias and Kila Verepo, the accused told the complainant that they had only received 28,000 Kina and offered to settle the deal for 20,000 Kina. This was a clear attempt to take further advantage of the complainant’s lack of sophistication and awareness of the difference between AUD and PGK. An “advance” of “$28k” referred to in the email, was not a reference to 28,000 Kina but AUD28,000, which on the exchange rate at the time[1], would have been equivalent to aboutPGK58,800.
  16. The complainant refused to accept the proposal because the agreement was for K105,340.50. The accused then told her they would pay her when they sold more gold they were expecting but thereafter refused to take her calls.
  17. Other than K5000 the accused gave her for mobilisation, the complainant never received any money for her gold.
  18. In summary the evidence establishes beyond reasonable doubt that between 31 October 2015 and 30 November 2015 the accused, Ernie Choi, Henry Mathias and Kila Verepo conspired to defraud the complainant.
  19. I note here that it is irrelevant whether or not Kila Verepo was a party to the conspiracy at the time of the initial discussions with the complainant. It is not necessary for the State to prove that all conspirators alleged in the indictment were parties to the agreement. As above, all that is required is that the State establish that there are at least two persons acting in combination. The conspiracy was clearly on foot at the time of the first meeting between the accused, Ernie Choi, Henry Mathias and the complainant. I find beyond reasonable doubt that Kila Verepo had joined the conspiracy at least by the time she signed the purchase agreement.

Of property, which was the Complainant’s


  1. In Roland Tomat [12] to [26] the Supreme Court made clear that it is not necessary to establish proof of ownership, rather that the alleged victim is deprived of some property which is theirs or to which they might been titled, or that the property, or some lawful right, interest, opportunity or advantage of that person is put at risk. In this case, however, the evidence establishes beyond reasonable doubt that the gold was property belonging to the complainant.

Participation of the Accused


  1. I am also satisfied beyond reasonable doubt that the accused participated in the conspiracy, such that at the time the accused agreed to use dishonest means to deprive the complainant of the gold, he intended to carry that objective into effect.
  2. Again, the evidence of his intent may be inferred from his overt acts. The evidence shows that he played an active and indeed leading role in implementing the conspiracy. Not only did the accused hold himself out as the CEO of ANZ, and participate in a number of meetings with the complainant, it was he who produced the purchase agreement from the Verepo Commodity Agency, he who initially signed on its behalf, and he who subsequently arranged for Kila Verepo to sign the purchase agreement. It was the accused who physically received the gold from the complainant and he who gave it to Henry Mathias.
  3. Henry Mathias’s statements to the complainant and Exhibit C are also relevant and admissible against the accused to prove both the existence of the agreement as outlined above, and the accused’s participation in it pursuant to the co-conspirators rule. I found that there was a prima facie case against the accused for the charge of conspiracy, or “reasonable evidence” of his participation, when I dismissed the accused’s no-case application at the close of the State case.
  4. It is significant in this regard that it was the accused who met with the complainant and offered her K20,000 on the basis that they had received only K28,000 for its sale further to the email and advice provided to the complainant by Henry Mathias.
  5. I also accept the complainant’s evidence that it was the accused who gave her K5000 to meet her “mobilisation” costs in Port Moresby.
  6. The State has excluded any rational inference that the accused’s involvement was limited to witnessing the purchase agreement or keeping the gold overnight.

Dishonesty


  1. I am further satisfied beyond reasonable doubt that according to the ordinary standards of reasonable and honest people, the means agreed to deprive the complainant of her gold, namely by telling her that she would be paid K105,340.50 when that was not the intention, were clearly dishonest. Having regard to those standards, I am also satisfied beyond reasonable doubt that the accused must have in fact known that the agreed means were dishonest. Finally, I am satisfied beyond reasonable doubt that the accused knew that he had no right to deprive the complainant of her gold. There is no other rational inference in all the circumstances.
  2. I note here that I have applied the subjective test for dishonesty affirmed in Havila Kavo v The State (2015) SC1450 and Wartoto v The State (2019) SC1834, and outlined below, in decisions concerning misappropriation contrary to s. 383A of the Criminal Code. There has been great divergence of judicial views over time in Australia and the United Kingdom as to whether it is necessary for the prosecution to establish dishonesty at the subjective level in a case concerning conspiracy, where the accused must also know that he had no right to deprive or put at risk the property or an interest of the victim and/or where “dishonesty” is not used in a “special sense” (see the discussion in each of the members of the High Court in Peters, in particular the decision of Toohey and Gaudron JJ, especially at [33], with whom Kirby J ultimately agreed). There is some appeal in this approach. Such considerations, however,really go to the more fundamental question of what is required to establish dishonesty and for that reason I have applied the test outlined by the Supreme Court in this jurisdiction in misappropriation matters.
  3. In summary, the State has established beyond reasonable doubt that the accused conspired with Ernie Choi, Henry Mathias and Kila Verepo to defraud Anna Sani by stating to her that they would buy 781.2 grams of gold from her for K105,340.50, contrary to s. 407(1)(b) of the Criminal Code. The evidence led by the State to prove each of the elements of the offence is such that any reasonable hypothesis consistent with the innocence of the accused has been excluded.
  4. Before turning to Count 2, it is important to note briefly that the State could have sought to establish the offence of conspiracy to defraud merely on the basis that there was agreement between the accused and his co-conspirators to obtain the gold from the complainant by representing to her that they were experienced commodity traders when they were not. This would have been sufficient to establish that the conspirators agreed to use dishonest means to put the complainant’s gold at risk, knowing that they were not entitled to do so, even if they only ever intended to do so for the purpose of making a commission from the sale of the gold. As the Supreme Court said in Roland Tom (supra):

“In a conspiracy to defraud the conspirators may never intend, or even foresee, loss or injury to another. The offence consists in agreeing to take the risk of injuring another’s right which the accused know they have no right to take: see Peters at [26], Wai Yu-Tsang v The Queen [1992] 1 AC 269, and Archbold Criminal Pleading, Evidence and Practice, (2015), at 17-63”.


  1. As above, however, I am satisfied beyond reasonable doubt that the conspiracy went well beyond this, and not only did the conspirators agree to lie to the complainant about being experienced commodity traders, they never intended to honour their promise to buy the gold for agreed price. Or in other words, whilst not a defence, the State has excluded any rational inference that the accused and his co-conspirators lied to the complainant about being experienced traders whilst intending to meet the agreed price but then through lack of experience or otherwise failed to sell the gold in Australia for the intended price.

MISAPPROPRIATION


  1. S. 383A of the Criminal Code creates the offence of misappropriation:

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

(a) property belonging to another; or

(b) ...

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;

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

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

(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.


  1. To establish the offence the prosecution must prove beyond reasonable doubt the following elements, such that the accused:
    1. applied;
    2. to his own use or to the use of another;
    1. property;
    1. belonging to another person;
    2. dishonestly.

Havila Kavo v The State (2015) SC1450.


Applied, to his own use


  1. As to what is meant by “applied to his own use”, the case of R v Easton [1993] QCA 255; [1994] 1 Qd R 531 (Court of Appeal) is instructive. The case concerned s.408C of the Queensland Criminal Code, on which s. 383A of the Criminal Code is modelled. In considering the meaning of “applied to his own use”, Macrossan CJ said (emphasis added) at page 534:

“It can be accepted that the section envisages some interaction between the person and the thing and this will not be met merely by the formation of an intention to act or the devising of a plan in respect of the thing. The section nevertheless stops short of requiring that there should be some consumption, expenditure or dissipation of the thing, alteration of its form or utilisation of it to secure some collateral material benefit, although these may be involved.I consider that the requirement of this part of the section is met when there has been a utilisation by the person involved for his own purposes. While the ways in which this may occur are legion, one example may illustrate the very minimal level of activity which I think would be sufficient. If a person takes a picture or work of art belonging to another and puts it in a place for the purposes of his own private enjoyment of it he will have applied it to his own use. He does not, for example, have to sell the picture before it can be said that this has occurred.

...When he first takes the item in an unauthorised way from the person to whom it belongs and carries it towards his house to implement his plan, I consider that he will have already applied it to his own use...


...before an item of property will be "applied", there has to be a mental element, an intention held in relation to the thing, and also there has to be some implementation of that intention, i.e. some act or acts which constitute some dealing with the thing: in simple terms something has to be done to or with the thing. Usually there will be, I think, some influence exerted upon the thing affecting its form, location or its attributes.The "application" will involve some deflection from the purposes of the person to whom the property belongs.”


  1. I agree with those principles. It follows that is not necessary for the State to prove that the accused ultimately received the proceeds of the gold. Indeed it is not the proceeds of the gold that the State has alleged were misappropriated but the gold itself.
  2. The accused admits that he received the gold from the complainant and gave it to Henry Mathias. I am satisfied beyond reasonable doubt that at the time the accused gave the gold to Henry Mathias he applied it for his own use, that is for the purpose of putting into effect the conspiracy to deprive the complainant of the gold without paying the agreed price. In particular, the accused diverted the gold from the purposes of the person to whom it belonged, namely the complainant, who although she provided it to the accused to give to Henry Mathias, did so for the purpose of receiving K105,340.50 as agreed, and as the accused well knew.

Property, belonging to the complainant


  1. There is no doubt that the gold was property for the purposes of s.383A(3)(a), nor that the property belonged to the complainant. Defence counsel submits that ownership in the gold passed to the “Verepo Commodity Agency Limited” upon the signing of the purchase agreement. I do not agree.
  2. Section 383A(3) of the Criminal Code provides that 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.
  3. Legal interest in the property did not pass upon the signing of the purchase agreement. Firstly, that is not what the purchase agreement says. Secondly, the purchase agreement was voidable for being induced by fraud. Furthermore, there is no reference in the purchase agreement to the agency being an incorporated company nor any other reliable evidence before me to establish that the Verepo Commodity Agency was in fact a legal person to whom property could pass. In any event, the complainant retained an equitable interest in the gold until completion of the contract.

Dishonesty


  1. Finally, I am satisfied beyond reasonable doubt that at the time the accused applied the gold to his own use he did so dishonestly. In determining this issue I have applied the test set out in Havila Kavo (supra) affirmed in Wartoto (supra):

“Element (v) of the offence of misappropriation, which requires the court to be satisfied that the accused applied the property “dishonestly” to his own (or another’s) use, requires a determination of the state of mind of the accused at the time of application of the property. Both the appellant and the respondent agree that dishonesty is a question of fact for the trial Judge to determine, based on the facts of the case and according to the ordinary standards of reasonable and honest people (Brian Kindi Lawi v The State [1987] PNGLR 183).

A subjective test must be applied: it must be proven beyond reasonable doubt that the accused in fact knew that he was acting dishonestly. However, in applying that test, an objective standard can be taken into account: it might reasonably be inferred that the accused must in fact have known that he was acting dishonestly (James Singo v The State (2002) SC700, The State v Gabriel Ramoi [1993] PNGLR 390, The State v Francis Natu wohala Laumadava [1994] PNGLR 291, The State v Andrew Ludwig Posai(2004) N2618, The State v Graham Yotchi Wyborn (2005) N2847, The State v Francis Potape (2014) N5773).”


  1. I am satisfied beyond reasonable doubt that it was dishonest according to the ordinary standards of reasonable and honest people for the accused to give the complainant’s gold to Henry Mathias in the circumstances in which it was obtained, and in furtherance of the conspiracy to deprive the complainant of her gold without paying the agreed purchase price. I am further satisfied beyond reasonable doubt that the accused must have realised that his conduct was dishonest according to those standards. There is no other rational inference.The accused well knew that the complainant would never have given him the gold to give to Henry Mathias had she been aware that he and his conspirators never intended to pay her the agreed purchase price.
  2. There is no dispute that at the time the property was of a value of more than K2000 for the purposes of s.383A(2)(d).
  3. In conclusion I am satisfied beyond reasonable doubt that the accused dishonestly applied to his own use and to the use of others property belonging to Anna Sani namely 781.2 grams of gold valued at K105,340.50, contrary to s.383A(1)(a)(2)(d) of the Criminal Code. The evidence led by the State to prove each of the elements of the offence is such that any reasonable hypothesis consistent with the innocence of the accused has been excluded.

Variance between the indictment and the weight of gold


  1. I note that there is some variance between the weight of the gold bar in the indictment (781.2 grams) and the weight reflected in the purchase agreement (780.3 grams) and the weight stated by the complainant in evidence (781.6 grams).
  2. As the Supreme Court said in George Ikalom & Anor v The State (2019) SC1888 with respect to a charge involving stealing at [50]:

“[I]t is not necessary that the prosecution should prove that all the articles named in the indictment have been stolen. It is sufficient to prove that the accused person stole any of them. See Archbold’s Criminal Practice, 19th Edition at 220: “A variance in the number of articles or in their value is immaterial”.”


  1. Those principles equally apply on a charge of misappropriation and depending on the nature of the agreement, on a charge of conspiracy.
  2. The variance between the particulars in Counts 1 and 2 in this case and the evidence are not material. There is no doubt that the accused conspired to deprive the complainant of her gold bar, and that he then misappropriated the same gold bar, and that it weighed about 781 gms.
  3. Verdict: Guilty of conspiracy to defraud and of misappropriation.

_______________________________________________________________
Public Prosecutor: Lawyer for the State
Yanson Lawyers: Lawyer for the Accused


[1] 1AUD:2.1PGK

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