Home | Databases | WorldLII | Search | Feedback Tonga Law Reports

R v Naidu [2001] TOLawRp 40; [2001] Tonga LR 229 (27 July 2001)

IN THE COURT OF APPEAL OF TONGA
Court of Appeal, Nuku'alofa

CA 24/2001

R

v

Naidu

Ward CJ, Tompkins, Spender JJ
25 July 2001; 27 July 2001

Sentencing – Crown appeal against fine imposed – forgery – non-custodial sentence
Misrepresentation and fraud – sentencing – Crown appeal against fine – fine upheld

The respondent, Surendra Naidu, was convicted on 29 August 2000 on one count of Forgery, contrary to section 170 of the Criminal Offences Act (Cap 18), and one count of Knowingly Dealing with a Forged Document, contrary to section 172 of that Act. A fine of $4000 was imposed on the Forgery count, and a fine of $3000 on the count of Knowingly Dealing with a Forged Document. The $7000 was ordered to be paid by 12 September 2000, in default three months imprisonment. The fines were paid on 7 September 2000. On 28 September 2001 the Crown filed an application for leave to appeal the sentences. The Crown claimed that the sentences were inadequate, did not reflect the level of criminality of the respondent, nor the abuse of trust the offences involved, and failed to give sufficient consideration to the need for general deterrence, particularly in respect of offences that were difficult to detect.

Held:

1. Ordinarily, offences of this kind involving abuse of trust warrant a custodial sentence. The maximum penalty for forgery was 7 years imprisonment, and for knowingly dealing with a forged document 5 years imprisonment. However because this was a Crown application, and because the fines imposed had been paid, there was the risk of injustice in undoing, what had occurred and imposing a custodial sentence.

2. Leave to appeal was granted, the sentences imposed were confirmed, and the respondent was ordered to pay compensation of $14,100 to South Pac Builders Supplies Limited, by 4 pm on 27 August 2001, in default six months imprisonment.

Case considered:

R v Misinale (Court of Appeal, CA 13/99, 23 July 1999)

Counsel for appellant: Mr Havea
Counsel for respondent: Mr 'Etika

Judgment

[1] After a three day trial before Justice Ford, Surendra Naidu ('the respondent') was convicted on 29 August 2000 on one count of Forgery, contrary to section 170 of the Criminal Offences Act (Cap 18), and one count of Knowingly Dealing with a Forged Document, contrary to section 172 of that Act.

[2] On 29 August 2000, Justice Ford imposed a fine of $4000 on the Forgery count, and a fine of $3000 on the count of Knowingly Dealing with a Forged Document. His Honour ordered the $7000 to be paid by 12 September 2000, in default three months imprisonment. The fines were paid on 7 September 2000.

[3] On 28 September 2001, pursuant to section 2 of the Court of Appeal (Amendment) Act 1997, the Crown filed an application, for leave to appeal the sentences imposed by Justice Ford.

[4] The Crown claims that the sentences are inadequate, do not reflect the level of criminality of the respondent, nor the abuse of trust the offences involved, and fail to give sufficient consideration to the need for general deterrence, particularly in respect of offences that are difficult to detect.

[6] The respondent, a Fijian, established a hardware business from about October 1996 with Sione Kiteau Topui in Nuku'alofa, under the name South Pac Builders Supplies Limited. In support of his application for a Tongan work permit, the respondent filed with the Immigration Department a four-page employment contract which he had prepared. This document was signed by the accused as "the employee", and by Mr Topui on behalf of South Pac Builders Supplies Limited as chairman of the company. Both signatures were witnessed by Mr Topui's daughter, Pilisita Topui.

[7] The respondent was managing director of the company. The sentencing judge found that he "obviously did a good job establishing the business". Initially there was a close and friendly relationship between Mr Topui and the respondent, which began to deteriorate in about August 1997 when Mr Topui's eldest son returned from the USA, and became involved in the running of the company. Mr Topui began to question the trust he had reposed in the respondent, while the respondent, for his part, suspected that Mr Topui and his family were trying to take over the company.

[8] In late March 1998, Mr Topui invited his nephew, Sebastian Hurrell, an experienced accountant and businessman, to come to Tonga from New Zealand to try and sort matters out. The result was an agreement that the respondent would leave the company.

[9] At a board meeting of the directors on 30 March, a hand written note was tabled which contained the respondent's entitlement to the severance package under his contract of employment.

[9A] On that same day Mr Hurrell asked the accused for a copy of the contract because he had not been able to find a copy around the office. Next day the accused produced a copy of the contract. That contract was a five page document. Mr Hurrell went through it and confirmed that his entitlement under it equalled the figure of $37,000 that had been calculated previously by the respondent. The accused had already had the $37,000 withdrawn from the company's bank account and placed in a solicitor's trust account.

[9B] That same day, 31 March 1998, Mr Howell drafted a letter for Mr Topui to sign addressed to the respondent confirming the settlement package. When Mr Topui signed the letter he was concerned about the proposed payment of $37,000 because he did not think that the accused was entitled to that sort of figure under the employment contract he had signed but Mr Hurrell told him that the figure matched up with his entitlement under the contract. Mr Topui, nevertheless, could not accept that the contract Mr Hurrell had been shown was the same document he had signed back in October 1996 and nor could his daughter, Pilisita, to whom he showed it.

[10] The trial judge rejected the respondent's account of how and when the five page document had come into existence. His Honour found that "there was only one genuine contract, and that was the contract given to the Immigration Department. The second contract was made up by [the respondent] alone without the knowledge or consent of the company or Mr Topui and it was made to deceive the company." The second contract consisted of four pages of terms and condition (which were more favourable to the respondent than the terms and conditions in the first contract), and a fifth page, which was the final page of the first contract.

[11] In respect of the second count, the trial judge found that the respondent "knew that the second contract was a forgery but he acted upon it in his capacity as general manager/ managing director of the company and he caused other people to act upon it as if it were genuine."

[12] In imposing sentence, the trial judge observed:

"Had you approached the directors and asked for the salary increase and other benefits provided for in the second contract, then I am sure you would have been able to work it through and they would have agreed."

[13] The production and use of the second contract must be seen as a brazen and criminal attempt at self-help in respect of the respondent's severance entitlements.

[14] We were told that the respondent has a judgment against his former solicitor for the $37,000 which was placed in that solicitor's trust account. That judgment might prove to be an empty one, but as between the company- and the respondent, the company is out of pocket by the difference between what was in fact paid in reliance on the forged contract, and what was the respondent's proper severance entitlement under the genuine contract of employment. This factor was not the subject of express reference by the trial judge when he imposed the sentences he did. The Crown did not quantify before the trial judge or on the application for leave to appeal the amount obtained by the appellant as a result of his forgery. We were also told from the bar that the entitlement of the respondent in respect of his shareholding in the company is unresolved.

[15] S 25 of the Criminal Offences Act (Cap 18) relevantly provides:

(1) Any person who is tried and convicted in the Supreme Court of an offence may be adjudged by the Court to make compensation to any person injured or suffering loss by his offence ...

(3) Any such compensation may be either in addition to or in substitution for any other punishment and in default of payment thereof the convicted person is liable to imprisonment for any period not exceeding 12 months.

[16] Having regard to the terms of the first and second contracts, and the contents of the hand written note put before the board meeting on 30 March, doing the best we can, the amount properly due on termination is as follows:

4 months salary after tax (2/3 of $20,264.79) 13,509.53

4 months housing allowance (2/3 of 6,000) 4,000.00

4 months vehicle allowance (2/3 of 4,800) 3,200.00

Passage fare for 4 1,156.00

Freight to Fiji 1,050.00

Total 22,915.53

The amount actually paid seems to have been $37,010.79. The extra amount paid by the company as a result of the respondent's forgery, rounded up, is therefore $14,100.

[17] Ordinarily, offences of this kind involving abuse of trust warrant a custodial sentence. The maximum penalty for forgery is 7 years imprisonment, and for knowingly dealing with a forged document 5 years imprisonment.

[18] This however is a Crown application for leave to appeal against sentence. The nature of such an application was considered by the Court of Appeal in Rex v Hanisi Misinale (Court of Appeal, CA 13/99, 23 July 1999). The Court there said at pp 4 - 5:

"... for such an appeal to succeed, clear and compelling grounds for increasing the sentence need to be established. It is not sufficient for the appellate court to consider that a more severe sentence could properly be imposed, or that the sentence imposed is inadequate or inappropriate. For a sentence to be increased on a Crown appeal, the appellate court must be satisfied that the sentence is so inadequate or inappropriate that the sentencing judge erred in that he or she must have acted upon a wrong principle, wrongly assessed a relevant circumstance, took into account irrelevant factors, failed to take into account relevant factors, or has imposed a sentence that is inconsistent with sentences the court has imposed for like offending. In such a situation, the appellate court is left with no alternative but to impose a more severe or a different sentence. If the court is so satisfied, the sentence should be increased only to the lower end of the appropriate sentencing range. Indeed, the appellate court, in fixing the proper range for this case, should take into account that it is an added penalty to have to face sentence a second time, and to have hope deferred, and perhaps dashed, in the result."

[19] Because this is a Crown application, and because the fines imposed have been paid, that there is the risk of injustice in undoing, what has occurred and imposing a custodial sentence at this stage.

[20] We think that in the light of events, justice will be served if leave to appeal be granted, the sentences imposed below be confirmed, and the respondent be ordered to pay compensation of $14,100 to South Pac Builders Supplies Limited, by 4 pm on 27 August 2001, in default six months imprisonment.