State v Kalup [2015] PGNC 132; N6038 (18 June 2015)

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CRIMINAL LAW – Practice and Procedure – what are appropriate sentences in this case – s.383A and s.404 of Criminal Code Act – considerations taken into account when deciding on a sentence – s.158(1) of Constitution – s.19 of Criminal Code

Belawa v The State (1988-89) PNGLR 496
State v Jimmy Kendi N3129
State v Dominic Kurai N3435
State v John Kil (2000) PNGLR 253
State v Jack Ostekal Metz (2005) N2824
The State v Paul Tiensten N5563
The State v David Kumalau Pondros & Otto Wangillen
The State v Stanley Haru

ZEBEDEE JABRI KALUP of Siar Village, Madang, Madang Province, stands charged that he between the 01st day of January 2011 and the 31st day of December 2011 at Madang in Papua New Guinea dishonestly applied to his own use and to the use of others monies in the sum of Five Hundred Thousand Kina (K500, 000.00) the property of the Independent State of Papua New Guinea.

ZEBEDEE JABRI KALUP of Siar Village, Madang, Madang Province, stands charged that he between the 01st day of January 2011 and the 31st day of December 2011 at Madang in Papua New Guinea dishonestly applied to his own use and to the use of others monies in the sum of Two Million, Five Hundred Thousand Kina (K2, 500,000.00) the property of the Independent State of Papua New Guinea.

ZEBEDEE JABRI KALUP of Siar Village, Madang, Madang Province, stands charged that he between the 01st day of January 2011 and the 31st day of December 2011 at Madang in Papua New Guinea dishonestly applied to his own use and to the use of others monies in the sum of One Million Kina (K1, 000,000.00) the property of the Independent State of Papua New Guinea.

ZEBEDEE JABRI KALUP of Siar Village, Madang, Madang Province, stands charged that he between the 01st day of January 2011 and the 31st day of December 2011 at Madang in Papua New Guinea dishonestly applied to his own use and to the use of others monies in the sum of Seven Hundred and Fifty Thousand Kina (K750, 000.00) the property of the Independent State of Papua New Guinea.

ZEBEDEE JABRI KALUP of Siar Village, Madang, Madang Province, stands charged that he between the 01st day of March 2010 and the 31st day of March 2010 at Madang in Papua New Guinea falsely pretended to Goli Buka Malai with intent to defraud, that he will deliver Agriculture Projects in Madang and obtained from the Department of National Planning and Monitoring, monies in the sum of One Million Kina (K1, 000,000.00).

ZEBEDEE JABRI KALUP of Siar Village, Madang, Madang Province, stands charged that he between the 01st day of March 2010 and the 31st day of March 2010 at Madang in Papua New Guinea falsely pretended to Goli Buka Malai with intent to defraud, that he will develop the Sitepra Nucleus Estate in Madang and obtained from the Department of National Planning and Monitoring, monies in the sum of Two Million Five Hundred Thousand Kina (K2, 500,000.00).

ZEBEDEE JABRI KALUP of Siar Village, Madang, Madang Province, stands charged that he between the 01st day of March 2010 and the 31st day of March 2010 at Madang in Papua New Guinea falsely pretended to Goli Buka Malai with intent to defraud, that he will deliver the Magic Passage Boat Freight Project in Madang and obtained from the Department of National Planning and Monitoring, monies in the sum of Seven Hundred and Fifty Thousand Kina (K750, 000.00).

2. The prisoner owns a number of companies namely Zenalis Waterfalls Ltd (Zenalis), North East Trans Ltd and Zebedee Sea Freight Ltd. All these companies are based in Madang as the prisoner is from Siar Village near Madang.

3. Between 1st March 2010 and 30 September 2010, the prisoner with the innocent and genuine endorsement of the then Open Member for the Madang Seat in the National Parliament, Hon. Goli Buka Malai, submitted 3 project proposals for the Madang District to the Department of National Planning and Monitoring (DNPM). At the same time the prisoner was engaged by the then Member of Parliament for the Kiriwina Goodenough Open Seat Hon. Jack Cameron to make a proposal for a rural communication project in Kasou Sau Community in Kiriwina, Milne Bay Province.

4. The 4 projects were approved by the DNPM and all 4 cheques were processed and issued in favour of Zenalis Waterfalls. The cheques were:

5. These cheques were deposited into Zenalis Bank accounts held at the Westpac Bank in Madang. From there the monies were paid out to various individuals and companies not related to the projects.

6. As a result of the moneys being applied for other uses other than for the purposes for which the monies were approved for the projects never got off the ground or were never followed through and completed. The purported projects were a total failure. In relation to the Agriculture project and the Sitepra project the prisoner simply made the proposals as a paper farmer with no expertise in cocoa farming or agricultural expertise.

7. As for the Kiriwina Communication project it never got off the ground. The prisoner with the former member for Kiriwina – Goodenough Jack Cameron misused that K500, 000.00. With respect police fraud squad must now investigate Jack Cameron on this and have him arrested and charged for the misuse of this money.

8. The prisoner and whoever he was dealing with in the Department of National Planning and Monitoring were simply using the then Open Member for Madang Hon. Goli Buka Malai without the member knowing he was being used or abused. The Member in good faith supported the projects by signing them to show his innocent support for the projects. The prisoner did this deliberately to try and avoid the then Madang District Joint Budget Planning and Priority Committee. He knew that if he took it to the Joint District Budget Planning and Priorities Committee the cheques would not be in the name of his company Zenalis. It was a clever and calculated plan to avoid the JDB&PC and succeeded once he got the Members signature.

9. The issue now is for the court to determine the appropriate sentences to impose on the prisoner for the various offences he has been convicted of.

(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:—

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

11. In relation to the charges of obtaining goods by false pretence s.404(i) says:

(1) A person who by a false pretence or wilfully false promise, or partly by a false pretence and partly by a wilfully false promise, and with intent to defraud—

12. The maximum penalties prescribed by law are 10 years and 5 years respectively. However, the maximum penalties are usually reserved for the worst type of cases in each category of offences. Whether the court should impose or not impose the maximum term is a matter of discretion of the court. That discretion is not taken lightly. The court will usually consider the circumstances under which the offences were committed. The court will also consider the following factors developed in Belawa v The State (1988-89) PNGLR 496:

13. The circumstances of the commission of the offences are that the prisoner knew where to source funding from in relation to certain projects. He also knew that he would have to come up with project proposals which would come within the criteria to qualify for funding from the DNPM.

14. The project proposals would have to be tailored in such a way that the funds if approved would not go to the District Treasury but to the project proponent in this case Zenalis. This was successfully done.

15. Section 19 of the Criminal Code Act gives the court the power to impose a sentence lesser than the maximum prescribed by law. It follows from the provisions of s.19 that sentencing involves the exercise of discretion. This is a power initially given to the courts by s.158 (i) of the Constitution which says that "the judicial authority of the people is vested in the National Judicial System." It is this power that the courts or the judges are exercising.

16. Sentencing is an art because one is considering many factors and trying to balance them to arrive at a fair sentence. All these processes go toward helping a judge to exercise his or her sentencing discretion equitably.

In this case a total of K4, 750,000 was given to the prisoner and dishonestly applied.

The prisoner is not a public servant. He was a private consultant. He however is from Siar village in Madang and his people put their faith and trust in him to do something for them but he abused that trust put on him by his own people. Even the then Member of Madang Open put his faith and trust on the prisoner to deliver the goods for the benefit of the Madang people. In that regard he had an enormous degree of trust placed on him by his own people and their leader.

All the planning was done in 2009. The monies were received in early 2010. A considerable amount of time was taken to plan the schemes and have them drawn up and to have them presented to the DNPM to have the proposals approved and funded. It then took time to draw the cheques and have them paid.

Some of the monies were used on the projects. Some were given to other people and companies not related to the projects and the prisoner used the rest on himself and his concubines.

The monies belonged to the people of PNG through the State. The money was for the benefit of the people of Madang District. The money did not go to them. It instead went to a few individuals who became rich overnight without any sweat. The victims are the people of PNG, more so the people of the Madang District. There is no real effect of the loss by the State. It is just that the people the projects and the money should have benefited are poorer.

The offender is now remorseful. He now has lost everything. He now wants to go and live in the Milne Bay Province. Maybe he now cannot face his own people for the wrongs he did to them. He cannot bear the shame in his own Madang District. He appears now to be ashamed of his actions and so he should be. He seeks refuge in Alotau now.

No restitution has been made or offered. There appears to be no prospect for restitution.

17. The prisoner in this matter is a first time offender. He has no prior convictions before any court. He in his pre-sentence report says he did deliver the projects and that 2 out of 4 projects were completed, that is the sea freight boat building and the Sitepra project. While he claims that, he is unable to show the court the completed products. The Sitepra plantation is all bushes again and there is no finished boat that his company built or maintained.

18. On page 5 of his pre-sentence report the prisoner says he is sorry for his actions. He however also says he wanted to help people in the rural areas.

19. Against him is the fact that if he was given K4, 750,000 which is a lot of money, there is nothing on the ground to show for it. He used the people in the rural areas to get funding but when he got the funding he forgot about them. That to me is cruel treatment of the rural people, the very people who he says he wants to help. He says two of the projects are completed. That would mean the K1, 000,000 Agriculture project was not completed. What happened to that K1, 000,000 and we already know on his own admission (not directly) that he and Jack Cameron misused the K500, 000 for the Kiriwina Communication Project. On that admission he appears to be saying that he misused K1, 500,000.00 only.

State v Jimmy Kendi	Prisoner found guilty after a trial on 2 counts of False Pretence and one count of misappropriation of K4,298,037.33	4 years imprisonment for false pretence and 9 years for misappropriation.
State v Dominic Kurai	Prisoner pleaded guilty to 1 count of false pretence. He obtained goods by false pretence from a trade store worth K7.	12 months but suspended on condition.
State v John Kil	Bill Kure advanced to prisoner K1, 470 after prisoner falsely promised him that he would repay Kure upon him getting his termination entitlements. Prisoner a former policeman.	18 months imprisonment but suspended on conditions that he repay the K1, 470 and other conditions.
State v Jack Ostekal Metz	Prisoner falsely represented to Guest House in Madang that he was expecting millions of Kina from sale of Treasury Bills. He convinced the Manager of the Guest House to accommodate him and that he would pay from the sale of the Treasury Bills. Prisoner was accommodated for 8 months at the guest house and incurred a bill of K70, 445.36 which he could not pay.	3 years 6 months imprisonment.

20. The above cases show an ever increasing trend in sentences handed by the courts. Even though the courts are sentencing prisoners to jail to serve time, this appears not to deter crimes of dishonesty being committed. The need for deterrent sentences to be imposed is ever so pressing in my respectful opinion. People who steal or dishonestly apply properties belonging to others must expect to spend time in jail.

21. In this case public monies were disbursed to a private company with no results. The private company and its owners and others dishonestly used that money on themselves. The company was in my view used as a vehicle to get the money. Once the money came in, the prisoner went into spending mode. Today there is nothing to show for it, but bushes for the agriculture and Sitepra projects and wrecks in Madang harbour.

22. Huge amounts of money were handed out to the prisoner and his companies. Those moneys were mostly misapplied to individuals and companies who had nothing to do with the projects. The monies belonged to the people. The Government gave out the monies. In the future the Government must be very careful when approving projects for funding by private companies. This case, the cases of The State v Paul Tiensten and The State v David Kumalau Pondros and Otto Wangillen are on point.

23. Considering all the circumstances of the case the sentences of the prisoner are:

Counts 1, 2, 3 and 4 sentences will be served concurrently with each other, Count 5, 6 & 7 sentences will be served concurrent to each other but will be served cumulative to Counts 1, 2, 3 and 4.

The end result is that the prisoner will serve a total of 11 years imprisonment with hard labour.

24. He has served 5 months while awaiting sentence. Those are taken out of the head sentence of 11 years. The balance he will serve is 10 years 7 months.
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Public Prosecutor: Lawyer for State
State Solicitor: Lawyer for Defence

National Court of Papua New Guinea

State v Kalup [2015] PGNC 132; N6038 (18 June 2015)