State v Leva [2020] PGNC 369; N8696 (13 November 2020)

N8696

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

CR (FC) NO. 606 OF 2019

THE STATE

V

BOBBY LEVA

Waigani: Berrigan J
2020: 8^th, 9^th, 10^th and 11^th September and 13^th November

CRIMINAL LAW – PRACTICE AND PROCEDURE - S. 383A of the Criminal Code - Misappropriation – Dishonesty – Guilty.

Cases Cited:
Papua New Guinea Cases

Havila Kavo v The State (2015) SC1450
Wartoto v The State (2019) SC1834
Ikalom & Anor v The State (2019) SC1888
David Kaya and Philip Kaman v The State (2020) SC2026

Overseas Cases

R v Easton [1993] QCA 255; [1994] 1 Qd R 531

Legislation and other materials cited:

Sections 23, 25, 383A of the Criminal Code (Ch. 262) (the Criminal Code)

Counsel

Ms T. Aihi and Ms. T Kametan, for the State
Mr E. Sasingian, for the Accused

DECISION ON VERDICT

13^th November, 2020

1. BERRIGAN J: The State presented an indictment charging the accused that he:
   

“between 1^st day of January 2017 and 30^th day of March 2018... dishonestly applied to his own use and to the use of others monies in the sum of Two Hundred and Ninety Nine Thousand Seven Hundred and Sixty Nine Kina Fifty Seven Toea (K299,769.57) property of Buk Bilong Pikinini Inc.”, contrary to s. 383A(1)(a)(2)(d) of the Criminal Code (Ch. 262) (the Criminal Code).

2. It was not in dispute that the accused was employed by Bank of South Pacific Limited (BSP) as a Portfolio Analyst attached to the Credit Business Unit at the Harbour City Branch. Nor was it in dispute that the accused and his mother, Loa Leva, were the owners of a registered business name “BAM Agencies” and holders of a Smart Business Account Number 7001101703 at BSP in the name of BAM Agencies.
   
3. The State alleged that during the material time cheques totalling K299,769.57 drawn against the BSP Cheque Account of Buk Bilong Pikinini, number 1009697390 were deposited to the BAM Agencies account, and that upon clearance of the monies, the accused drew cash cheques in the sum of K290,199 from his company account, signed by him and his mother. Furthermore, that neither BAM Agencies nor the accused provided any services or had any contract to provide services to Buk Bilong Pikinini Incorporated (Buk Bilong Pikinini).
   
4. The accused pleaded not guilty. The accused did not dispute that he applied monies belonging to Buk Bilong Pikinini to his own use and the use of others. He denied, however, that he did so dishonestly.
   

STATE CASE

5. The State’s case was largely documentary. The State tendered, by consent, various business records, together with statements from several bank witnesses formally producing bank records for the accounts of both Buk Bilong Pikinini and BAM Agencies. A statement provided by the accused to police and his record of interview were also tendered. Investment Promotion Authority records show that BAM Agencies was registered as a business name with the Investment Promotion Authority on 18 April 2012: Exhibit P3, P4, P5.
   

Bank Evidence

6. Bank records establish that a BSP Smart Business Current Account in the name of BAM Agencies, No. 7001101703, was subsequently opened in July 2014, to which the accused and his mother, Loa Levi, were both signatories: Exhibits P6, P7, P8, P9, P10, P11; Exhibit P104 Q&A 29 to 32.
   
7. Bank records produced by BSP establish that cheques in the amounts shown in the second column of the following table were deposited to the account of BAM Agencies, No. 7001101703, during the relevant period. All cheques deposited to the account were drawn on the BSP account of Buk Bilong Pikinini, No. 1009697390. No other deposits were made to the account during the material period.
   
8. Bank records also establish that withdrawals in the amounts shown in the third column were made from the BAM Agencies account during the relevant period by way of cash cheque. All cheques drawn on the BAM Agencies Account were payable to cash and bore the name and signature of the accused and his mother on the reverse.
   
9. On 30 January 2017 and 20 March 2017 cash in the sum of K2500 and K270 was deposited to the accused’s personal account No. 1006078537 by him immediately following a cash withdrawal from the BAM Agencies account.
   
10. Cash handling and other fees were also charged against the BAM Agencies account. As at 29 March 2018 the credit balance of the BAM Agencies account was K840.24.
    

Date	Buk Bilong Pikinini Cheques Deposited to BAM Agencies Account – Amount in Kina	Cheques cashed on BAM Agencies Account – Amount in Kina	Exhibit
16.1.17	3,912		P12, P72, P58, A
18.1.17		3,800 Harry Al, recalls that it was the accused who cashed the cheque (Ex E)	P12, P26
26.1.17	3712		P12, P73, P58
30.1.17		3800 Bruce Peter, recalls that it was the accused who cashed the cheque (Ex D) Further, that the accused immediately deposited K2500 of the monies to his personal bank account No. 1006078537	P12, P27 P28, P102, D
2.2.17	3660		P13, P74, P59, E
6.2.17		3600 Bruce Peter, recalls that it was the accused who cashed the cheque (Ex D)	P13, P29
8.2.17	3433		P13, P75, P59, E
10.2.17		3490 Clyde Noah, recalls that the accused presented and cashed the cheque (Ex A)	P13, P30
16.2.17	3512		P13, P76, P59, F
20.2.17		3500 Deliva Harold, recalls that the accused cashed the cheque (Ex F)	P13, P31
23.2.17	3712 Bruce Peter recalls that accused deposited the cheque (Ex D)		P13, P77, P59, B
24.2.17		3712	P13, P32, D, X
1.3.17	3655		P14, P78, P59, E
3.3.17		3607 Deliva Harold, recalls that the accused cashed the cheque (Ex F)	P14, P33
7.3.17	3354		P14, P79, P60, G
9.3.17		3250 Leontine Lavi, recalls that the accused cashed the cheque (Ex G)	P14, P34
16.3.17	2700 Willie Fime recalls that the accused deposited the cheque		P14, P80, P60
20.3.17		2700 Deliva Harold, recalls that the accused cashed the cheque (Ex F) K270 deposited to accused’s personal bank account	P39, P14, P35, B – see below
3.4.17	3720 Bruce Peter recalls that the accused deposited the cheque (Ex D)		P15, P61, P61
5.4.17		3740 Bruce Peter, recalls that the accused cashed the cheque (Ex D)	P15
18.4.17	9843.86 Bruce Peter recalls that accused deposited the cheque (Ex D)		P15, P81
20.4.17		9700 Bruce Peter, recalls that the accused cashed the cheque (Ex D)	P15, P36, D
24.4.17	6874		P15, P82, P61
26.4.17		6800 Bruce Peter, recalls that the accused cashed the cheque (Ex D)	P15, P37, D
29.5.17	13,131.77		P16, P83, P62, D
30.5.17		12900 Bruce Peter, recalls that the accused cashed the cheque (Ex D)	P16, P38
26.7.17	13474.65		P17, P84, P63, I
28.7.17		K13,300 Harry Al, recalls that the accused cashed the cheque (Ex E)	P40
7.8.17	13,847.23		P18, P85, P64, J
9.8.17		13600 Harry Al, recalls that the accused cashed the cheque (Ex E)	P18, P41
16.8.17	14,177.47		P18, P86, P64, R
18.8.17		13900	P18, P42
23.8.17	6.300		P18, P87, P64, H
25.8.17		6100 Harry Al, recalls that the accused cashed the cheque (Ex E)	P18, P43
20.9.17	14057.63		P19, P88, P65, E
22.9.17		14000 Harry Al, recalls that the accused cashed the cheque (Ex E)	P19, P44
5.10.17	15885.50		P20, P89, P65, K
9.10.17		15700 Bruce Peter, recalls that the accused cashed the cheque (Ex D)	P20, P45
20.10.17	13320.14		P20, P90, P66, K
24.10.17		12900 Bruce Peter, recalls that the accused cashed the cheque (Ex D)	P20, P46
1.11.17	15961.86		P21, P91, P66, M
3.11.17		15700 Mari Guma recalls that the accused cashed the cheque	P21, P47
13.11.17	13200.60		P21, P92, P67, L
15.11.17		12800 Jamie Kona recalls that the accused cashed the cheque (Ex M)	P21, P48
29.11.17	12941.04		P21, P93, P67, N
1.12.17		12750 Mari Guma recalls that the accused cashed the cheque	P22, P49, O
13.12.17	14367.80		P22, P94, P68, P
15.12.17		14000 Mari Guma recalls that the accused cashed the cheque	P22, P50, Q
20.12.17	13624.50		P22, P95, P68, P
22.12.17		13450	P22, P51, Q
16.1.18	13475.50		P23, P96, P69
18.1.18		13200	P23, P52, S
31.1.18	11640.42		P23, P97, P69, C
5.2.18		11400 Philip Kevin recalls that the accused cashed the cheque (Ex V)	P24, U, W
9.2.18	9640		P24, P98, P70, T
13.2.18		9400 Mari Guma recalls accused made cash withdrawal	P24, P54
21.2.18	11645.40		P24, P99, P70
23.2.18		11270 Mari Guma recalls that the accused cashed the cheque	P24, P55, Z
20.3.18	12634.40		P25, P100, P71, Y
22.3.18		12170 Mari Guma recalls that the accused cashed the cheque	P25, P56, Z
23.3.18	14355.80		P25, P101, P71, AA
27.3.18		13700	P25, P57, BB
Total	K299,769.57	K290,199

11. Where BSP tellers formally confirm that they processed the transaction their statement, given an alphabetical reference on admission, is referred to in the fourth column. Where they specifically recall dealing with the accused, that is noted in the second or third column above.
    
12. In this regard, according to the statement of Willie Fime, Lending Officer, BSP, tendered by consent, Exhibit B, the deposit of Buk Bilong Pikinini cheque Number 548 dated 20 March 2017 in the sum of K2700, P80, was personally made by the accused to the BAM Agencies account. The accused’s mother was also present at the time. The accused told him that he did a delivery to Buk Bilong Pikinini and the cheques were signed in Buk Bilong Pikinini’s office and brought to the branch.
    
13. According to the statement of Bruce Peter, Customer Service Officer, BSP, Exhibit D, it was the accused who personally deposited the Buk Bilong Pikinini cheques to the BAM Agencies account on 23 February 2017, 3 April 2017 and 18 April 2017 in the sums of K3712, K3720 and K9843.86, respectively.
    
14. Further, that he received Buk Bilong Pikinini cheque number 596 payable to BAM Agencies for K13,131.77 on the afternoon of 29 May 2017 at about 4pm from another bank officer Bau Kiso. The cheque was contained in an envelope together with a signed withdrawal slip. He did not process the withdrawal until the following day. He then contacted the accused via email who asked him to bring K12,900 cash to the Stop N Shop Harbour City at lunch time, which he did, except for K100 which the accused told him to hold back for himself. He acknowledges that it was not in accordance with bank policy for him to take the cash out of the bank.
    
15. He also recalls that the accused conducted withdrawals from the BAM Agencies account on 30 January 2017, 6 February 2017, 5 April 2017, 20 April 2017, 26 April 2017, 9 October 2017 and 24 October 2017. He further recalls that he was given K100 by the accused after hours after cashing the BAM Agencies cheque on 30.1.17.
    
16. The State also called three witnesses who gave oral evidence, Mari Guma, Lucinda Gulluman Kisip and the investigating officer, Gabriel Kayho. Other than with respect to one issue in the case of the latter, dealt with below, their evidence was effectively unchallenged. I accept their evidence as credible and reliable having regard to both its content in the context of the evidence as a whole and their demeanour when giving that evidence.
    
17. Mari Guma gave oral evidence that he has been employed with BSP for 12 years. He is currently a Team Leader in the Credit Business Unit at BSP, Harbour City Branch, Port Moresby. He knows the accused as a colleague from the Credit Department in the same building. He assisted the accused cash cheques drawn on the BAM Agencies account on six occasions: P47, P49, P50, P54, P55 and P56. The accused would call via telephone and leave the cheque at reception. Guma would confirm that the signatures matched that on the bank records, withdraw the cash from the account and on the accused’s instructions, leave it in an envelope at reception for the accused to collect.
    

Buk Bilong Pikinini Evidence

18. Lucinda Gulluman Kisip, was the Executive Officer of Buk Bilong Pikinini at the relevant time, and responsible for reporting to its board of directors, managing twenty program staff and forty other staff in six locations across Papua New Guinea. She oversaw seven program areas, including the finance and administration section. Within the area of finance, her key responsibilities included financial reporting to the board at quarterly meetings, oversight of accounting and finance processes, and conducting checks and balances at the end of the month.
    
19. She was one of three signatories to the Buk Bilong Pikinini Account. Before signing a cheque a process had to be followed: three quotes had to be obtained, supported by documentation, together with a vendor analysis if required. To her recollection BAM Agencies was not one of Buk Bilong Pikinini’s preferred contractors. She was shown cheques P72 to P101. She did not recall signing the specific cheques, or any cheques to BAM Agencies with such regularity. She did not pre-sign any cheques before she left Buk Bilong Pikinini to join Oil Search Ltd. Furthermore, whilst the cheques bore a signature in each case that looked like hers, or was made to look like hers, it was not hers.
    
20. In cross-examination she agreed that she did not sign the cheques made payable to BAM Agencies. She did not know who signed them but agreed they were raised internally within Buk Bilong Pikinini. The cheque book was held within the Finance Section but she was not sure who raised the cheques.
    

Record of Interview and Statement

21. The accused participated in an interview with police. In the record of interview, P104, the accused was taken through each of the deposits, which he confirmed were made to the BAM Agencies account, although he had “no idea”, or wasn’t “too sure”, who deposited the monies. He was taken through and admitted personally making each of the cash withdrawals from the BAM Agencies account during the relevant period.
    
22. In summary, he said that Bradley Tuvi, his old school friend, would usually tell him that monies had been deposited. In each case the accused would withdraw the monies and give them to Tuvi, who would give the accused some “fees” for using the account, which he used for his own “personal use”. He could not recall how many times, or the amount he was given in fees. He maintained that he believed the payments were “genuine” because Tuvi told him that monies were for contract works, and promised to produce contract documents, and because the cheques were cleared by BSP into the BAM Agencies account.
    
23. The record of interview contains the following questions and answers, which are representative of his position (verbatim):
    

Q 34: Where Bradley Tuvi did got the money and deposited them into your joint business account Bam Agencies? A: In 2016, Bam Agencies was awarded a contract by Buk Bilong Pikinini to do maintenance at their Koki library. Our company did some maintenance at Koki library and received some payments from Buk Bilong Pikinini. After that Bradley Tuvi mentioned to me that there will be other works to be carried out. I did not know how he got the Buk Bilong Pikinini cheques and deposited them into Bam Agencies BSP bank account. I always ask Bradley Tuvi for documents to verify those cheque payments into Bam Agencies Account. Most of the times, Bradley Tuvi will deposit the funds into our business account without our knowledge. He (Bradley Tuvi) would always tell me that there are documents there when I asked him. My mother always tells me to tell Bradley Tuvi to provide documentation for the cheque deposits into our company account. But Bradley Tuvi always mentions that the documents are there and will provide to me later on but he never provide them to us. I trusted Bradley Tuvi as BSP has a process of bank cheque to be cleared (verification or checking system) after deposits were done. Q 63: Bobby Leva, do you have any knowledge about the transactions, (Deposits and Withdrawals) on Bam Agencies bank account 7001101703? A: Regarding the deposits, I don’t know how it’s done and who goes to the bank and deposit the funds. Bradley Tuvi usually calls me over the mobile phone and tells me to go to the bank and withdraw the funds as he had deposited funds into Bam Agencies account. For the withdrawals, I did them all after Bradley Tuvi calls me and advise me that he had deposited funds into Bam Agencies account. Q 72: What services did you or Bam Agencies provide to Buk Bilong Pikinini and received this cheque payments of K3, 912.00? Bam Agencies didn’t provide any services to Buk Bilong Pikinini and received this payment of K3, 912.00. However, Bradley Tuvi usually tells me that he had deposited the funds into Bam Agencies account and the money is for contracts works. Q 74: What did you do to the cash of K3, 800.00? A: I gave the cash to Bradley Tuvi at Harbor city and he told me that he will go and see the guys who did the construction works. Q 75: According to the documents shown to you, a Buk Bilong Pikinini cheque deposit of K3, 712.00 was deposited into the account on 26th January 2017. Who deposited the said amount into Bam Agencies account? A: I am not sure. Q 76: What services did you or Bam Agencies provide to Buk Bilong Pikinini and received this cheque payment of K3, 712.00? A: Will be the same answer as for my answer to question number 74, I asked him for documents to confirm the payment but he always tells me that the funds are for contract works and they are all good. Q 77: As per Bam Agencies account history statement, Bam Agencies cheque number 000024 was raised and K3, 800.00 was withdrawn from Bam Agencies account on 30th January 2017 after the two days clearance? Who signed on Bam Agencies cheque number 0000024 and withdraw the sum of K3, 800.00 on 18th January 2017? A: Me and my mum signed the cheque 024 and I presented the cheque and withdraw the said amount at BSP Haus, Habour City. Q 93: Why did you withdraw the funds (K3, 490.00)? A: I went and withdraw the funds because Bradley Tuvi called me and tells me that he had deposited the funds into Bam Agencies account. The funds were cleared in the account so thinking that the cheque went through the checking and verification process at the Bank it is a genuine; I trusted him and withdraw the funds. Q : What did you with the K3, 490.00 cash? A: I gave it to Bradley Tuvi and asked him for the documents for the payment but he gives that same reasons as the paper works are okay and will give me later which he never did. He also gives me some cash for using Bam Agencies account. Q 94: Bobby, after several deposits from Buk Bilong Pikinini made into Bam Agencies account and no documents to confirm the deposits coming into Bam Agencies account, where you at any one time suspicious of Bradley Tuvi’s actions and behaviours? A: Yes, I was suspicious and asked him several times for documentations to prove the deposits that were coming into Bam Agencies account. Also my mum would remind me every time to tell Bradley Tuvi about the documentation which he never provided. He always replied to me that the documents are okay and when seeing the funds coming as cleared funds into Bam Agencies account, I thought these are genuine deposits. And also the bank’s system of clearing the cheque. Q 105: Bobby, what did you do with the cash of K3, 607.00? A: I gave it to Bradley Tuvi. Every time I withdraw funds and gave it to Bradley Tuvi, I always asked him for the documentation of the payments and he always gives me the same answers that the documentations are okay and they are there in their office. Q 106: Bobby, Bradley Tuvi didn’t provide any documentation to prove that the payments were genuine. As the Bank employee, why didn’t you report the matter to Buk Bilong Pikinini or the Bank (BSP)? A: I didn’t report the matter because every time when the funds are deposited into Bam Agencies account, they are cleared and I see that these are genuine transactions. At the same time, Bradley Tuvi usually tells me that the payments are genuine. Q 112: What did you do with the K2, 700.00 cash? A: I gave it to Bradley Tuvi and asked the same questions regarding the documentation, but he still gives me the same answers as he will give me the papers later. The funds were cleared so I believed that it is a genuine transaction that comes into Bam Agencies account as the Bank has cleared the funds in which they (Bank) do the checks and verifications. When I presented the cheque at the counter, I wasn’t asked about the funds in the account as it was cleared. Q 124: Bobby, did you received any cash from Bradley Tuvi after giving him the cash of K6, 800.00? A: Yes, he gives me fees for using Bam Agencies account but couldn’t recall the exact amount. The fees vary from time to time as there was no exact amount agreed to be given to me. Q 128: Bam Agencies BSP Bank account history statement revealed that a sum of K13, 131.77 was deposited into the account on 29th May 2017. Do you know who deposited the said amount in Bam Agencies account? A: No, and I don’t know the amount too until I saw it in the system. Q 129: Bobby, how comes you will not know the person depositing the funds into Bam Agencies account and suddenly, Bradley Tuvi will call you and tells you that he had deposited funds into Bam Agencies account. Did this ring a bell to you of who was the person depositing the funds into Bam Agencies account? A: No, because I wasn’t there at the scene and Bradley Tuvi would just said in pidgin “koins stap insait long account”. Q 143: What did you do to the cash of K6, 100.00? A: Same as my answers to other previous questions regarding what I did with the funds that I withdrew from Bam Agencies account. He will give my fees and tells me that the documents are okay and genuine, and he’ll provide the documents later. Since the funds were made clear by the Banking system with the cheque deposits from the Buk Bilong Pikinini Cheque into Bam Agencies account I trusted that nothing was wrong and I did the withdrawal and gave it to him. Q 146: As per Bam Agencies account history statement, Bam Agencies cheque number 0000041 was raised and K14, 000.00 was withdrawn from Bam Agencies account on 22nd September 2017. Who signed on Bam Agencies cheque number 0000041 and withdraw the sum of K14, 000.00 on 22nd September 2017? A: Me and my mum signed the cheque 0000041 and I presented the cheque on the mentioned date and withdraw the said amount. I sometime do my banking at BSP Haus and sometimes at Ravallion, I cannot really recall as it has been awhile now. My mum always asks me what these payments are for and why are there no documents to verify these payments going through, and I tell her that Bradley says everything is documented and he would provide these documents later on, which he never. Q 168: What services did you or Bam Agencies provided to Buk Bilong Pikinini and received this cheque payment of K15, 885.50? A: No services were provided to Buk Bilong Pikinini by me or Bam Agencies. At times of handing the cash to Bradley Tuvi he always mentions to me that the payments are for contract works and that all documents are okay and he will provide later. Since all the past cheques came through the Bank’s system, I trusted him and believed that the payments are genuine as the payments passes through the checking systems and the bank tellers. I believed that proper checks were done at the Bank. Q 227: Bobby, what did you do to the rest of the K13, 200.00 cash? A: I gave the cash to Bradley, and he give me my fees for using my company account, as usual I would require for the documentations for the works done, he always say that these are genuine, the documents are there and he would provide later, I also trusted him as a good friend. I also believed and trusted that the BSP Banks did their diligence check with the cheques to have it cleared before it was made available into my Company Account (BAM Agencies). Q 233: What services did you or Bam Agencies provide to Buk Bilong Pikinini and received this cheque payment? A: We didn’t provide any service to Buk Bilong Pikinini, but Bradley says these are for works, I ask him for the documents, his responds is always the same that it’s a genuine work and he’ll produce the documents later. As a friend I trusted him. I also trusted the BSP system had done its diligence check of the signatories and scanning of cheques before the funds were made available to my company account. Q 243: Bobby, is it true that Bradley Tuvi deposited the funds into your company account and called and advised you to withdraw the funds? A: I don’t know who deposited the funds into Bam Agencies account but Bradley Tuvi tells me that funds are in my account. Q 318: Do you have anything to say about you charge? A: Yes, firstly I want to thank you two’s (Gabriel Kayho & Terrence Wanzing) for your kind support through this period of the investigations conducted which allows me to cooperate during the process. I acknowledge your understanding and respect during the process of the Record of Interview to allow me to exercise my Constitutional rights under section 42 (2) which I did without any hesitations. Secondly, I didn’t have any knowledge of Bradly Tuvi’s intentions of defrauding Buk Bilong Pikinini account between the said dated. Since he was my school friend, I trusted him and in good faith I assisted him. He didn’t at any one time tells me about what he was doing apart from telling me that the documentations of all the payments were okay, and in there office and will provide to me later when I usually ask him. He would tell me that these payments are genuine which I trusted him as every time I went to withdraw the funds at the bank (BSP), I haven’t faced any problems regarding the Bam Agencies account. All the funds were cleared by the Bank’s system so that made me trust Bradley Tuvi. However, he never showed me any of the documents he mentioned. As a good friend of Bradley Tuvi, I assisted him but at the end he betrayed me and my trust to him as a friend and a brother. And now, this case has involved my mother Loa Leva, as one of the suspects as she is the other signatory to Bam Agencies business account 7001101703.

24. When the accused was initially taken through each of the Buk Bilong Pikinini cheques deposited to the BAM Agencies account in the record of interview he said that he did not know who deposited the cheques in each case, and maintained this as a general proposition at Q&A 243. Later upon being shown a deposit slip, however, he recalled that it was he who deposited Buk Bilong Pikinini cheque no 535 in the sum of K3712 on 23 February 2017 to the BAM Agencies account himself. He said Tuvi asked him to do it because he did not want to stand in a queue (P104 at Q&Q 299). The accused then admitted that he deposited “one or two” others himself but he could not recall when or the amount involved (P104 Q&A 300).
    
25. The accused also admitted paying K100 to Mari Guma on several occasions in appreciation for his assistance in cashing the cheques: see Q&A 196, 209, 220, 261, 267 and 274.
    
26. During the record of interview, the accused was shown a statement he provided to police dated 13 April 2018. It was admitted by consent as Exhibit P105.
    
27. In it the accused says that in 2014 he met his old school friend, Bradley Tuvi, who was employed with Buk Bilong Pikinini. He asked him if he had a registered company and to “do up a structure” for building and maintenance for BAM Agencies. Tuvi told him that Buk Bilong Pikinini had some building maintenance work to do at some of their libraries and he would push for BAM Agencies to be awarded some contracts to do the work. Sometime later, somebody called “Toxcin” called him and told him the contract had been awarded. Monies were credited to the account, which he withdraw and gave to Tuvi who said he needed it to pay the casual youths and buy materials for the works. He never checked to see if the works were done but when it was completed some monies were deposited to the account. In 2015 Tuvi called him and told him that he deposited money to the BAM Agencies account belonged to a Buk Bilong Pikinini librarian, and that it was a pay out of her leave credits. Tuvi made deposits for staff on various occasions. The accused asked to meet the staff but Tuvi never introduced them as he promised. Tuvi also deposited money to the BAM Agencies account without the accused’s knowledge. He told him it was for contract works. The accused asked Tuvi for “confirmation documents” but he never showed him. Tuvi usually gave him “some portion” of those monies.
    
28. Defence counsel made it clear that no issue was taken with the content of the statement except for one sentence about “dirty money” that the accused said was not made by him. The investigating officer, Gabriel Kayho, was cross-examined on this point. Whilst he initially said that the statement reflected the accused’s words, he later conceded that it was he who mentioned the term “dirty money” in the context of beer and police roadblocks. In my view his evidence was somewhat equivocal. I will disregard the sentence about “dirty money”.
    
29. Digicel records produced under search warrant and admitted by consent, P 107, include a transcript of text messages during the relevant period between mobile telephone numbers registered to the accused and Bradley Tuvi. The mobile telephone numbers match those provided by the accused in his statement to police, P105. There are many exchanges between the accused and Tuvi but for the most part the messages do not appear to be relevant.
    
30. On 10 June 2017, however, the accused sent a message to Bradley Tuvi: “Man mi need lo u givim coins please u givim heavy lo mi stap”. I note here that in his record of interview the accused stated that the monies were referred to as “koins”. At P104, Q&A 129, the accused said he didn’t know who it was who deposited the monies because he wasn’t there but that Bradley Tuvi would just say in pidgin “koins stap insait long account”.
    
31. On 26 July 2017 Tuvi sent a text message to the accused “Man Friday you rausim k8000 na come gim me low crown plaza, lo lunch time. K5474 blo you. Me school stap na nogat time to come lo harbour city. OK Jason”. The reference to “Jason” is not clear but the numbers correspond with those provided by the accused. Furthermore, bank records show that a cheque for K13,474.65 was deposited to the BAM Agencies account on that day and K13,300 withdrawn two days later on Friday, 28 July 2017.
    

DEFENCE CASE

32. The accused declined to give evidence himself or to call any other witnesses in his defence. That is his Constitutional right and I draw no inference of guilt as a consequence of that decision.
    

MISAPPROPRIATION

33. Section 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) property belonging to him which is in his possession or control (either solely or conjointly with another person) subject to a trust, direction or condition or on account of any other person,

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.

34. 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;
    100. property;
    4. belonging to another person;
    5. dishonestly.

Havila Kavo v The State (2015) SC1450.

35. Elements a), b), c) and d) are non-contentious. The accused does not dispute that he applied property belonging to another person to his own use and the use of another. He denies, however, that he did so dishonestly.
    
36. I make clear that the State has the burden of proving each and every element of the charge contained in the indictment beyond reasonable doubt.
    

Findings of Fact

37. The evidence establishes that the accused and Bradley Tuvi are old friends from Port Moresby National High School and the University of Papua New Guinea. The accused was aware that Bradley Tuvi was employed by Buk Bilong Pikinini.
    
38. The accused is a well-educated, professional, employed in the financial industry. He has attended both high school and university. At the material time the accused had been employed with BSP, one of the country’s largest financial institutions, as a Portfolio Analyst attached to the Credit Business Unit, for more than six years, and was responsible for data analysis and report writing for the bank.
    
39. As established by bank records and the accused’s admissions, he and his mother operated the BAM Agencies account at BSP at the relevant time (P6 to 11, P104, Q&A 29 to 32 and 36 to 57).
    
40. In a little over 15 months almost K300,000 was deposited to the BAM Agencies bank account by cheques drawn on the account of Buk Bilong Pikinini.
    
41. Bank records show and the accused admits that the only deposits to the BAM Agencies account during the relevant period were cheques drawn on the account of Buk Bilong Pikinini: P104, Q&A 61. Prior to the first deposit on 16 January 2017 the account had a credit balance of only K53.29.
    
42. In total 31 cheques were deposited on 31 separate occasions totalling K299,769.57. The first ten deposits to the account ranged from K2700 to K3912, thereafter the deposits increased in size, ranging from K6300 to K15,885.50.
    
43. By the accused’s own admission, Bradley Tuvi advised him when the deposits had been made to the account. By his own admission, the accused withdrew the monies shortly thereafter in each case and gave them to Bradley Tuvi, after keeping “a portion” for himself.
    
44. Furthermore, I accept the unchallenged evidence of Wille Fime and Bruce Peter that it was the accused who personally deposited Buk Bilong Pikinini cheques to the BAM Agencies account on five occasions (23 February 2017, 20 March 2017, 3 April 2017, 18 April 2017 and 29 May 2017 in the sums of K3712, K2700, K3720, K9843.86 and K13,131.77, respectively). Here too the accused admitted in his police interview that he personally deposited Buk Bilong Pikinini cheques to the account on a number of occasions, albeit he said that it was at the request of Tuvi: Q&A 299. Telephone records show that on one occasion, in June 2017, it was the accused who sought the monies out from Tuvi.
    
45. Bank records show and the accused admits that the only withdrawals from the BAM Agencies account during the relevant period were withdrawals made by the cashing of cheques, signed by the accused and his mother. In total 31 such withdrawals were made. In each case they followed just a few days after a Buk Bilong Pikinini cheque had been deposited and in each case the amount withdrawn corresponded to the amount deposited, albeit that it was not identical.
    
46. By the accused’s own admission BAM Agencies, purportedly a transport provider, did not provide any services to Buk Bilong Pikinini during the relevant period. From its bank account, it does not appear that BAM Agencies provided any services to any one during the relevant period.
    
47. By his own admission the accused received “fees” for cashing the cheques through the BAM Agencies account, which he applied to his personal use.
    
48. On two occasions the proportion of monies kept by the accused was very high. Of the second cheque ever cashed, on 30 January 2017, K2770 of the K3800 withdrawn was immediately deposited to the accused’s personal bank account. Similarly, Tuvi instructed the accused to keep K5474 of the K13,474 deposited on 26 July 2017.
    
49. By his own admission, the accused gave money to certain officers at the bank on a number of occasions following the cash withdrawals. By his own admission, monies were often left in an envelope at the reception of his building for him to collect, or delivered to him outside the bank.
    
50. By his own admission the accused never made any enquiries with Buk Bilong Pikinini as to the purpose of the funds.
    

Property

51. For the purposes of s. 383A of the Criminal Code, property includes money and all other property real or personal, legal or equitable, including things in action and other intangible property: s. 383A(3)(a).
    
52. I find beyond reasonable doubt that the cash monies withdrawn from the BAM Agencies account between 18 January 2017 and 27 March 2018 are property for the purpose of s. 383A of the Criminal Code.
    

Belonging to another person

53. Section 383A(3)(d) of the Criminal Code provides that “persons to whom property belongs includes the owner, any part owner, any person having a legal or equitable interest in or claim to the property...”.
    
54. It is an uncontentious fact that Buk Bilong Pikinini Inc. is an incorporated entity and legal person.
    
55. Lucinda Gulluman Kisip gave evidence that she did not as Buk Bilong Pikinini’s Chief Executive Officer authorise the payments to, or sign the cheques made payable to, BAM Agencies purporting to bear her signature. Her evidence is consistent with the admissions of the accused that neither he nor BAM Agencies provided any services to Buk Bilong Pikinini.
    
56. It follows and the evidence establishes that Buk Bilong Pikinini did not intentionally draw and deliver to BAM Agencies the cheques made payable to it. The accused does not dispute this. It is his contention that he was not aware of that fact at the time.
    
57. Accordingly, I find beyond reasonable doubt that Buk Bilong Pikinini retained an equitable interest in or claim to the monies that were deposited to the BAM Agencies account without its authority, and which were subsequently withdrawn from it by the accused.
    

Applied, to his own use and the use of others

58. By his own admission the accused withdrew the monies from the BAM Agencies account with the intention of keeping some of the monies for himself and giving the rest to Bradley Tuvi: P104, Q&A 71 to 275. For the reasons discussed further below, the accused knew at that time that neither he nor BAM Agencies had any entitlement or claim to the monies.
    
59. I am satisfied beyond reasonable doubt that when the accused withdrew the monies belonging to Buk Bilong Pikinini from the BAM Agencies account, with the intention of keeping some of the monies for himself and giving the rest to Bradley Tuvi, the accused applied the monies to his own use.
    
60. Here I adopt and apply the reasoning of Macrossan CJ of the Supreme Court of Queensland in R v Easton [1993] QCA 255; [1994] 1 Qd R 531in considering s 408C, the equivalent provision in the Queensland Criminal Code at that time regarding the meaning of applied to his own use:
    

“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...”.

Dishonestly

61. The State must establish beyond reasonable doubt that at the time the accused applied the property to his own use he did so “dishonestly”. This requires a determination of the state of mind of the accused at that time. It is a question of fact to be determined by the trial judge, 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 such that it must be proven beyond reasonable doubt that the accused in fact knew that he or she 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 or she was acting dishonestly: Wartoto adopting and applying Havila Kavo (supra); see also James Singo v The State (2002) SC700, The State v Gabriel Ramoi [1993] PNGLR 390, The State v Francis Natuwohala 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).
    
62. I refer to the above findings of fact. The accused admits that neither he nor his business provided any services to Buk Bilong Pikinini during the relevant period. It is also clear that there was no contract for BAM Agencies to provide any services to Buk Bilong Pikinini during the relevant period. I further find that the accused knew that neither he nor his business had any claim or entitlement to the monies. Indeed, the accused does not assert otherwise. Instead he claims that the monies were deliberately deposited to the account without his knowledge and that he provided them to Bradley Tuvi believing that he would then provide them to unknown Buk Bilong Pikinini staff members and/or building contractors. I reject this claim. It is vague and unconvincing.
    
63. It is simply implausible that the accused, an experienced bank officer, believed that Buk Bilong Pikinini would pay either its staff members or its building contractors in cash, via an undocumented and uncommunicated arrangement, through an unrelated third party bank account, for onward delivery via one of its own employees, or that it would pay fees in unspecified amounts to the holder of the bank account to do so.
    
64. I find that the accused’s conduct was dishonest according to the standards of honest and reasonable people. In a little over 15 months the accused applied to his own use almost K300,000 belonging to Buk Bilong Pikinini for which he well knew that neither he nor his business BAM Agencies had provided any services, nor had any contract to provide services, nor had any claim or entitlement to the monies.
    
65. I am also satisfied beyond reasonable doubt that having regard to his intelligence, education and experience, the accused knew at the time he applied the property to his own use that what he was doing was dishonest. There is no other rational inference.
    
66. My view is only strengthened having regard to his long-standing relationship with Tuvi, the large amount of monies involved, the period of time over which the application took place, and the number, nature, size, frequency and timing of the withdrawals concerned.
    
67. In summary, the evidence shows that in a little over 15 months almost K300,000 was deposited to the bank account controlled by the accused from Buk Bilong Pikinini in respect of which neither he nor his business provided any service, nor had any entitlement or claim. On several occasions the accused deposited the cheques himself. On one occasion the accused sought the monies out. It was the accused who withdrew the monies from the bank account, always within just a few days, always in cash. On several occasions he asked bank officers to leave the cash in envelopes for him at the building’s separate reception, or to deliver it to him outside the bank. On several occasions he gave bank officers monies in appreciation of the cash withdrawals. On every occasion he kept some of the monies for himself and gave the rest to Bradley Tuvi.
    
68. The State’s evidence has excluded any rational inference the accused was a naïve but honest victim of Bradley Tuvi. On the contrary the evidence establishes that the accused and Bradley Tuvi were working together to dishonestly apply the monies belonging to Buk Bilong Pikinini.
    
69. In particular, I do not accept the accused’s statements in the record of interview or his police statement that for 15 months he both naively trusted Tuvi, whilst also being suspicious such that he repeatedly asked Tuvi to produce both Buk Bilong Pikinini staff members to whom the money supposedly belonged, and/or contract documents for some unknown building works by some unknown contractors who had nothing to do with BAM Agencies. It is implausible.
    
70. Nor do I accept the accused’s answers in the record of interview that he did not know, had “no idea”, or was “not too sure” about who deposited the cheques. On the contrary the evidence shows that the accused knew very well the cheques were coming from Bradley Tuvi: it was Bradley Tuvi who contacted him about the deposits on most occasions and to whom the accused admits he gave the monies on each occasion, after keeping some of them for himself. On other occasions it was the accused himself who deposited the Buk Bilong Pikinini cheques to the BAM Agencies account.
    
71. Nor do I accept the statements that the accused believed that the payments were “genuine” because the bank had done its “diligence checks of the signatories” before paying the cheques into the BAM Agencies account. The accused knew very well that neither he nor BAM Agencies had any entitlement to the monies deposited to the BAM Agencies account. The accused is an intelligent man. All he had to do was make a simple enquiry with Buk Bilong Pikinini as to the nature and purpose of the large amounts of money being deposited into his business’ bank account on a frequent basis.
    
72. The accused has not claimed and for the reasons stated above the State’s evidence has excluded beyond reasonable doubt that the accused genuinely or honestly believed that he had a legal claim of right or entitlement to apply the monies to his own use pursuant to s. 23(2) of the Criminal Code.
    
73. The following principles were recently summarised in David Kaya and Philip Kaman v The State (2020) SC2026. A claim of right only has to be honest, it does not have to be reasonable (Tiden v Tokavanamur-Topaparik [1967-1968] PNGLR 231, Sebulon Wat v Peter Kari [1975] PNGLR 325). If the accused presents evidence of an honest claim of right the State bears the onus of disproving it. It is not for the accused to prove that he had an honest claim of right. It is the duty of the State to prove that he did not have an honest claim of right (Magr v R [1969-70] PNGLR 165, Francis Potape v The State (2015) SC1613). The State must disprove (exclude) the defence beyond reasonable doubt (John Jaminan v The State (No 2) [1983] PNGLR 318). Whether an accused has an honest belief is a question of fact to be determined by the evidence in each case. It is not a matter of an accused simply saying on oath that he had an honest belief and having that assertion accepted, as such evidence might be unconvincing as it was, for example, in R v Hobart Magalu [1974] PNGLR 188 and The State v Henry Gorea [1996] PNGLR 141. Once the defence operates, it is a complete defence to any offence relating to property of which fraudulent or dishonest intent is an element: Wartoto v The State (supra).
    
74. In addition, the belief must be one of legal entitlement to the property and not simply moral entitlement: Ikalom & Anor v The State (2019) SC1888 adopting MacLeod v R [2003] HCA 24; (2003) 214 CLR 230; and The State v Felix Luke Simon (2020) N8183 applying R v Pollard [1962] QWN 13, 29; R v Bernhard [1938] 2 KB 264, 270; and Harris v Harrison (1963) Crim LR 497. Furthermore, whilst a claim need not be reasonable, one that is unreasonable may be less likely to be believed as being genuinely or honestly held: The State v Felix Luke Simon (supra) adopting Macleod v The Queen [2003] HCA 24; (2003) 214 CLR 230.
    
75. As above, the accused does not dispute that neither he nor BAM Agencies provided any services to Buk Bilong Pikinini during the relevant period. This together with the State’s evidence excludes any rational inference that the accused believed he had an honest claim of right to the monies deposited to the BAM Agencies account for that reason.
    
76. For the reasons outlined above, the evidence also excludes any rational inference that the accused honestly believed that he had a legal claim or entitlement to give the monies to Bradley Tuvi for the purpose of payment to unknown persons.
    
77. Whilst the accused does not assert it directly, I also reject any suggestion that the effect of his record of interview is to claim a right to the fees he retained for allowing Bradley Tuvi to use the BAM Agencies account. For the reasons outlined above, the State’s evidence has also excluded any rational inference that the accused honestly believed he held any legal entitlement to the money, or any part of it, for that purpose.
    
78. Here I note that it is implausible that despite cashing out the monies paid into the account on 31 occasions during a 15 month period, i.e. on average every couple of weeks, the accused was unable to recall how much he kept of the monies for himself, even in broad terms, for such “fees”.
    
79. For similar reasons the State has also excluded any rational inference that the accused acted under any honest and reasonable, but mistaken belief for the purposes of s. 25 of the Criminal Code that the monies were “genuinely” or intentionally paid by Buk Bilong Pikinini into the BAM Agencies account.
    

Value of monies

80. There is no dispute and I find that the property was of a value of more than K2000 for the purposes of s.383A(2)(d).
    
81. There were a number of ways the case could have been approached having regard to s 7 of the Criminal Code. It proceeded on the basis that the withdrawals constituted the applications, as I have so found. In my view the monies left in the account were also applied by the accused for his own use, including to cover cash handling and other fees but there were no submissions on that. Accordingly, I find that he misappropriated K290,199. This is a small variation from the amount averred in the indictment. The amount of monies alleged to have been misappropriated is not an essential element of s. 383A(1)(a) of the Criminal Code. Proof that the accused dealt with any portion of the value of it is sufficient to constitute the offence: S. 530 (6) and (7) of the Criminal Code.
    

Conclusion

82. In conclusion, I am satisfied beyond reasonable doubt that the accused dishonestly applied to his own use monies in the sum of K290,199 belonging to Buk Bilong Pikinini Inc., contrary to s. 383A(1)(a)(2)(d) of the Criminal Code (Ch. 262) (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.
    
83. Verdict: Guilty of misappropriation.
    

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