N9001

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

CR (FC) No. 238 OF 2020

THE STATE

V

SHERMAN BEANGKE

Waigani: Berrigan J
2021: 8th June, 7th July and 12th August

CRIMINAL LAW– SENTENCE – GUILTY PLEA - S 383A(1)(a)(2)(d) of the Criminal Code – Guilty plea - Misappropriation of K142,670 – monies paid to offender’s company for goods withdrawn in cash and spent at hotels and stores over a three-month period – Sentence of 4 years of imprisonment, partially suspended on conditions.

Cases Cited:

David Kaya and Philip Kaman v The State (2020) SC2026
Goli Golu v The State [1979] PNGLR 653  
The State v Tardrew [1986] PNGLR 91 
The State v Frank Kagai [1987] PNGLR 320
Wellington Belawa v The State [1988-1989] PNGLR 496 
Lawrence Simbe v The State [1994] PNGLR 38  
The State v Paroa Kaia (1995) N1401
The State v Simon Paul Vurmete (2000) N2008 
The State v Benson Likius (2004) N2518
The State v Niso (No 2) (2005) N2930
The State v Felix Kautete (2018) N7544
The State v Dumo (2018) N7574
The State v Posakei (2019) N8000
The State v Namaliu (2021) N8506  
The State v Vavine Elizabeth Emil (2021) N8789

Legislation and other materials cited:

Sections 19, 383A(1)(a)(2)(d) of the Criminal Code.  

Counsel

Ms S. Mosoro, for the State
Mr N. Pilaei, for the Accused

DECISION ON SENTENCE

12th August, 2021

1.	BERRIGAN J: The offender, Sherman Beangke, pleaded guilty to one count of misappropriating K142,670, belonging to K92 Mining Limited, contrary to s. 383A(1)(a)(2)(d) of the Criminal Code, on the basis of the following agreed facts, which were confirmed by the depositions.

2.	The offender is the sole director and owner of Absolute Workwear Limited (Absolute Workwear), a company registered with the Investment Promotion Authority, and the only signatory to the company account held with Bank of South Pacific Limited (BSP), number 1004300362 in the name of Absolute Workwear Ltd.

3.	The complainant company, K92 Mining Ltd, was an existing client of Absolute Workwear.

4.	On 29 April 2019, K92 Mining Ltd transferred K45,650.00 from its Australian & New Zealand Banking Group (ANZ) bank account into Absolute Workwear’s account as upfront payment for the purchase of lockers for its mining department.  This purchase was made under purchase no. 130666 recorded under the pro forma invoice no. 0126.

5.	On 5 June 2019 a second payment of K97, 020 was made to Absolute Workwear’s account for the purchase of polo t-shirts purchased under number 13800 as per the pro forma invoice 0130.

6.	No items were delivered in response to the payments, despite several follow up emails.  On 29 of August 2019 K92 Mining Ltd laid a complaint with police.  Investigations revealed that the offender dishonestly applied the monies to his own use through multiple cash withdrawals and spending at various hotels, stores and other venues. 

Allocutus 

7.	On allocutus the offender said:  I’d like to apologise to the court and also extend my apology to the complainant, K92 Gold Mine for the offence committed.  I regret committing the offence and I endeavour to try and make amends by repaying whatever money was allocated through this transaction between me and the complainant.  This is my first appearance in court and I’d like to seek mercy from court’s judgement for leniency…  I’ve been struggling for the last two years due to Covid and hadn’t had any operations up until now, but I have a small project which is doing quite well and based on that operation, I think I am capable in repaying the monies to the complainant”. 
Sentencing Principles and Comparative Cases
8.	The offender has been convicted of one count of misappropriating K117,788.87 contrary to s. 383A(1)(a)(2)(d) of the Criminal Code for which the maximum penalty is 10 years of imprisonment.

9.	In Wellington Belawa v The State [1988-1989] PNGLR 496 the Supreme Court identified a number of factors that should be taken into account on sentence  for an offence of misappropriation, including:

a)	the amount taken;
b)	the quality and degree of trust reposed in the offender;
c)	the period over which the offence was perpetrated;
d)	the impact of the offence on the public and public confidence;
e)	the use to which the money was put;
f)	the effect upon the victim;
g)	whether any restitution has been made;
h)	remorse;
i)	the nature of the plea;
j)	any prior record;
k)	the effect on the offender; and
l)	any matters of mitigation special to the accused such as ill health, young or old age, being placed under great strain, or perhaps a long delay in being brought to trial.

10.	Having regard to the scale outlined in that case, and following amendments to s 383A, the Supreme Court (Batari and Berrigan JJ) in David Kaya and Philip Kaman v The State (2020) SC2026 suggested that the following scale of sentences may usefully be accepted as a base, to be adjusted upwards or downwards according to the factors outlined in Wellington Belawa, such that where the amount misappropriated is between:

a)	K1 and K1000 a gaol term should rarely be imposed;
b)	K1,000 and K10,000, a gaol term of up to two years is appropriate;
c)	K10,000 and K40,000, two to three years’ imprisonment is appropriate;
d)	K40,000 and K100,000, three to five years of imprisonment is appropriate;
e)	K100,000 and K500,000, five to seven years’ imprisonment is appropriate; and
f)	K500,000 and K999,999.99, seven to 10 years of imprisonment is appropriate, bearing in mind that the maximum under s 383A(2) should be reserved for the worst types of offending involving amounts less than K1 million.

11.	Defence counsel submitted in aggravation that there was a breach of trust, the monies were applied to a use other than that intended, a substantial amount was involved and dishonesty offences are prevalent.  In mitigation he asked the court to consider that the offender was a first time offender, he pleaded guilty and demonstrated remorse, he approached the complainant to develop a repayment plan but the complainant refused, he cooperated with police and is a member of the Catholic Church.  He submitted that a sentence in the range of five to seven years, wholly suspended would be appropriate.   He referred to the following cases:

a)	The State v Posakei (2019) N8000, Susame, AJ: The prisoner pleaded guilty to misappropriation of K143, 812.46 belonging to the East New Britain Provincial Administration. Whilst employed as Human Resources Advisor he devised a scheme whereby the salaries of 7 suspended officers were paid into the prisoner’s personal accounts. The prisoner was sentenced to 6 years imprisonment, wholly suspended with conditions; 

b)	The State v Niso (No 2) (2005) N2930, Gavara-Nanu J, in which the prisoner was found guilty following trial of conspiracy, fraudulently uttering a false document, and the misappropriation of K500,000.00 belonging to his employer, the Bank of Papua New Guinea.  The offences took place over a period of about 3 weeks.  At the time he was the Senior Clerk and Supervisor in the General Ledgers Section.  The prisoner was sentenced to an effective term of 7 years, 6 months of imprisonment (from which 8 months spent in custody was deducted).

12.	The State agreed in mitigation that the offender had pleaded guilty and is a first time offender, who showed remorse and has indicated a willingness to repay the monies. In aggravation, such offences are prevalent, the monies were large, the offence was carried out over 5 months, and had a great impact on the complainant, who wanted the monies repaid within three months or a much longer jail term.  It submitted that a sentence in the range of three to five years would be appropriate.  The State referred to the following cases:

a)	The State v Simon Paul Vurmete (2000) N2008 in which the offender was sentenced to 3 years’ imprisonment after pleading guilty to misappropriating K41,233.24 from his employer, the Water Board, over a period of 8 months involving a complex scheme;

b)	The State v Benson Likius (2004) N2518, Lenalia, J: The prisoner pleaded guilty to one (1) count of misappropriation a sum of K68, 679.06.  He was a payroll clerk he misappropriating the property of his employer Lihir Management Company using a scheme applied over a period of 20 months.  There were assets from which substantial restitution could be made immediately.  A sentence of five years was imposed, two years of which was suspended upon conditions including restitution;

c)	The State v Paroa Kaia (1995) N1401, Sawong J:  The prisoner pleaded guilty of one count of misappropriating as sum of K94, 478.31 belonging to ANZ Bank over a 2 month period.  At the time he was an accounts supervisor with the bank.  He was sentence to 4 years’ imprisonment; 

d)	The State v Felix Kautete (2018) N7544, Berrigan, J:  The prisoner, the prisoner pleaded guilty to one count of misappropriation.  The prisoner received K24, 000 on the basis that he would purchase a vehicle on behalf of the complainants but instead applied the monies to his own use.  He repaid K9,000.00 prior to sentence.  He was sentenced to 3 years’ imprisonment wholly suspended on conditions, including restitution; 

e)	The State v Vavine Elizabeth Emil (2021) N8789, Berrigan, J:  the prisoner pleaded guilty to misappropriating K117, 788.87 over a period of seven months whilst employed to process payments and invoices.  Using the ANZ electronic transaction system she directed funds intended to legitimate service providers to her personal bank account.  She was sentenced to four years, two years of which was suspended;

f)	The State v Dumo (2018) N7574, Berrigan J:  The offender was the Manager of Operations at the Education Department pleaded guilty to one count of misappropriating K87, 731.00, the property of the State.  The offender received the funds as a refund but failed to pass them on to the Department.  He was sentenced to 4 years of imprisonment, 2 years of which was suspended upon conditions, including restitution.

Consideration  

13.	It is well established that the maximum penalty is reserved for the most serious instances of the offence:  Goli Golu v The State [1979] PNGLR 653.  

14.	Section 19 of the Criminal Code provides the Court with broad discretion on sentence. Whilst guidelines and comparative cases are very relevant considerations, every sentence should be determined according to its own circumstances: Lawrence Simbe v The State [1994] PNGLR 38.  

15.	Having regard to the principles outlined in Wellington Belawa, the following matters have been taken into account.

16.	The offender is a mature man of 43 years of age.  He is from Fagame Village, Henganofi, Eastern Highlands and currently lives in Waigani, Port Moresby, with his mother.  His father lives in the village. The offender is currently single but continues to support his former wife of 14 years, and his three children, two twins aged 11 and their eldest, 16 years of age. 

17.	The offender is well educated.  He attended Nudgee College in Australia and obtained a Diploma in Business Management in 1998.  

18.	He is self-employed and concentrates on merchandising the supply of safety equipment through his company.  The business started in 2009 but due to covid the business has struggled.  He is currently focused on buying and selling raw coffee.

19.	It is well settled with respect to offences concerning dishonesty that, in general terms, the greater the amount of money involved the more serious the offence. In aggravation, the offence in this case involves a substantial amount of K142,670.

20.	In addition, the offence was conducted over a period of three months (not five as submitted by the State).  The bank statements show that monies were withdrawn on an almost daily basis from the time they were first deposited until the bank account was brought down to just K80 on 1 August.  No other deposits were made to the account during the period.  

21.	There is no dispute that the monies were applied for the offender’s own use.  The bank statements show multiple and large cash withdrawals, together with spending at hotels, supermarkets and other stores.  I take into account that the offender has previously attempted to make restitution. The complainant quite properly has declined to accept it until the matter is resolved by the Court.  

22.	There was no real breach of trust in this case, that is there was no special relationship between the victim and offender; it was a business relationship.  

23.	There is limited information about the impact on the victim, K92 Mining, which operates the Kainantu Gold Mine.  It is a large mining company but I accept that the company has lost a substantial amount of money.  It is not for the company, however, to tell the Court what the sentence should be. 

24.	In mitigation this is the offender’s first offence.  I accept that he is of prior good character.    

25.	Very significantly, the offender cooperated from a very early stage with authorities and pleaded guilty at the first opportunity before this Court.    I am satisfied of his genuine remorse.  His guilty plea has also saved this Court and the State, the time, cost and inconvenience of a trial.     

26.	It is clear to me that the impact of the offence on the offender will be significant.  I am sure that it has impacted on his standing in the community.  Any term of imprisonment will have a very detrimental effect on his coffee business which is doing well but is in its early stages.  There can be no doubt that any time spent in custody will have a significant impact upon his mother and his children.  

27.	In addition, the offender has suffered from moderate kidney impairment since 2015, which requires regular monitoring, as confirmed by his doctor from St Mary’s Medical Centre.  

28.	I have had regard to the offender’s personal circumstances, and the matters in mitigation, namely his lack of previous conviction, prior good character, early cooperation, early guilty plea, sincere remorse and efforts to make some restitution. These are factors in his favour but they are outweighed by the aggravating factors in this case, namely the quantum of the offence and the period over which the offence was conducted. Dishonesty offences are prevalent and this case calls for both general and specific deterrence.

29.	Having considered all of the above matters, including comparative cases, I sentence the offender to 4 years of imprisonment.  I understand that to date the offender has not spent any time in custody.

30.	The question remains whether any of the sentence should be suspended. 

31.	In The State v Tardrew [1986] PNGLR 91 the Supreme Court set out three broad, but not exhaustive, categories in which it may be appropriate to suspend a sentence, namely: where it will promote the general deterrence or rehabilitation of the offender; where it will promote the repayment or restitution of stolen money or goods; or where imprisonment would cause an excessive degree of suffering to the particular offender, for example because of bad physical or mental health. 

32.	The offender asks for suspension so that he might make restitution but he requires two years to do so. Probation Services is of the view that he may be able to do so but it is based on just the first purchase and sale of coffee in July this year.  The details of the new business are also unclear.  No contracts are produced.  The sales seem to be in a different company name and the offender’s role in the company is unclear.

33.	Furthermore, this case involves a substantial amount of money.  It is my view that a wholly suspended sentence is not appropriate given the nature and circumstances of this case. I also accept that the offender suffers from moderate kidney impairment but there is no evidence before me to establish that it cannot be treated whilst in custody.  I appreciate that incarceration will have a negative impact on his business but it would be an error of principle in general terms that offenders with means or business interests might serve their sentences outside prison whilst less wealthy or entrepreneurial offenders who commit the same crimes do not: The State v Namaliu (2021) N8506 at [67].  

34.	I am, however, satisfied that the offender has very good prospects of rehabilitation.  This is demonstrated by his early and full cooperation with authorities and his early plea before this Court.  I am satisfied that partial suspension of the sentence will facilitate the resumption of his business activities and promote his rehabilitation into the community.  I also take into account that his medical condition, whilst not causing excessive suffering in prison, will make his detention more difficult.  This is not an exercise in leniency but an order made in the community interest: The State v Tardrew [1986] PNGLR 91; The State v Frank Kagai [1987] PNGLR 320.    

35.	In the circumstances I make the following orders.

Orders

(1)	The offender is sentenced to four years of imprisonment in light labour to be served at Bomana Correctional Institution.

(2)	Two years of the sentence is suspended upon completion of two years of imprisonment, upon the offender entering into his own recognisance to keep the peace and be of good behaviour for the period of his suspension.

(3)	The offender shall perform 100 hours of appropriately designed community work under the supervision of the Probation Service during the period of his suspension.

(4)	Any bail monies are to be immediately refunded.

(5)	As a precautionary measure during the Coronavirus State of Emergency, the offender is to be held in an appropriate isolation facility at the Bomana Correctional Institution for two weeks before transfer to the general population, subject to medical assessment.  

________________________________________________________________
Public Prosecutor:   	Lawyer for the State		
Public Solicitor:	Lawyer for the Offender