Judge: owner's friend 'started fire'

A series of traceable phones calls between a Sydney man and his best friend helped prove they probably burnt a house down as part of an "amateur” insurance fraud, a court has found.

While there was insufficient evidence to lay criminal charges, the NSW Appeal Court ruled the rental property owner asked his friend to torch the Sydney house for insurance to fund an extensive rebuild.

It was the only logical conclusion from circumstantial evidence, Justice Anthony Meagher said.

Owner Sachin Sharma's explanation about why his friend, identified in the judgement only as Mr Sen, had left a pre-paid phone (called the scene phone) at the house after the fire was implausible.

Mr Sharma also could not explain how four phones – his personal phone, another prepaid phone in Sharma's possession (phone X), the scene phone, and Mr Sen's personal phone – shared common contacts and a history of phone calls and texts between them.  All four phones had been used to make regular calls to contacts common to both men.

"The evidence points clearly to Mr Sen having used the scene phone at the time and place of the fire to speak to Mr Sharma, who was using phone X," Justice Meagher said.

"The compelling inference is [Mr Sharma] consented to lighting the fire."

The court heard Mr Sharma's Ingleburn investment property burnt down about 11.30pm on 12 June 2012. Police found the fire was deliberately lit and soon began investigating Mr Sharma and his childhood friend from Fiji, Mr Sen.

Police found "considerable circumstantial evidence” Mr Sen lit the fire, either in collaboration with Mr Sharma or with his knowledge but could not gather enough evidence to lay criminal charges.

After police indicated criminal charges were unlikely, Mr Sharma tried to collect $526,889 from his home and contents cover but NRMA Insurance denied liability, arguing Mr Sharma lit or knew who lit the fire.

Mr Sharma sued in the NSW District Court, arguing there was no evidence he was responsible or would benefit from the fire. On 3 February 2017, Judge Robert Montgomery found on the balance of probabilities Mr Sharma and Mr Sen were working together.

He said the evidence of calls and texts between the four phones and to common contacts was more than coincidence. Judge Montgomery said Mr Sharma had been evasive in giving evidence, and there was reason to believe Mr Sen lied to police.

Their conduct during the investigation and trial; common contacts on all four phones; and calls and texts between them in the lead up to and after the fire were sufficient reasons for him to rule in NRMA's favour.

Mr Sharma appealed on the grounds Judge Montgomery was not entitled to find on the evidence Mr Sharma was involved and NRMA had not established a motive. The insurance would have covered only a rebuild and new contents and could not be considered a sufficient windfall for a person to risk committing arson, he said.

On 1 December last year, Justice Meagher, with whom Justice Robert Macfarlan and Acting Justice Ronald Sackville agreed, found the evidence "clearly” pointed to Mr Sharma's and Mr Sen's involvement.

He said previous tenants gave evidence repairs were needed and would have had to be completed before the house was re-let. That alone was motive to encourage Mr Sharma to seek insurance to cover costs. 

Justice Meagher said a tenant gave evidence Mr Sharma talked about the payout he would receive if the house burnt down and various explanations offered by Mr Sharma and Mr Sen about the four phones were implausible.

In cross-examination Mr Sharma had argued several people had access to his phones and might have been responsible for calls between his and Mr Sen’s phones. They included his office assistant and work-experience students; his wife and sister; and, when he was overseas, his girlfriend, a friend, members of travelling groups and his website designer.

Justice Meagher said it was difficult to believe the explanation and it was "more likely than not” Mr Sharma was responsible for the suspicious calls.

Justice Meagher said Judge Montgomery was entitled to disbelieve Mr Sharma and his evidence. In particular, delays by Mr Sharma in answering questions about his connection to the phones were suspicious.

"[Judge Montgomery] regarded those delays as providing [Mr Sharma] with the opportunity to satisfy himself as to the purpose of the question so it might be answered without conceding a connection between himself, Mr Sen and the lighting of the fire,” he said.

Justice Meagher said he agreed with Judge Montgomery’s conclusion Mr Sharma’s "unsatisfactory evidence indicated a consciousness of guilt”.

"The only conclusion available on the probabilities is Mr Sen continued to use the scene phone on the evening of the fire until he accidentally left it at the rear of the property after [starting] the fire and [speaking to Mr Sharma on] phone X," Justice Meagher said.

"This interchangeable use of the two phones to make calls and send messages to the same common contact is not easily or sensibly explained as mere coincidence."

Sachin Sharma v Insurance Australia Ltd t/as NRMA Insurance [2017], NSWCA 307, 01/12/2017