Agius v The Queen
[2011] NSWCCA 119
•24 May 2011
Court of Criminal Appeal
Supreme Court
New South Wales
Medium Neutral Citation: Agius v R; Abibadra v R; Jandagi v R; Zerafa v R [2011] NSWCCA 119 Hearing dates: 13 May 2011 Decision date: 24 May 2011 Jurisdiction: Criminal Before: Tobias AJA at 1
Johnson J at 2
Hall J at 96Decision: 1. Leave granted to the Applicants under s.5F(3)(a) Criminal Appeal Act 1912 to appeal against the interlocutory judgment or order of Simpson J refusing a permanent stay of the second count on the indictment.
2. Appeals dismissed.
Catchwords: CRIMINAL LAW - application for leave to appeal under s.5F Criminal Appeal Act 1912 - refusal by trial Judge to grant permanent stay of second count on indictment - indictment alleging two counts of conspiracy - Crown alleges single tax fraud conspiracy extending from 1997 to 2008 - change in legislative regime during course of alleged conspiracy - two counts charged to reflect change in legislative regime - whether second count foredoomed to fail - whether necessary for Crown to prove fresh agreement entered for purposes of second count - nature of conspiracy - continuing offence - whether s.135.4 Criminal Code 1995 (Cth) required proof of fresh agreement entered into within period of second count - physical element of s.135.4(5) offence - "state of affairs" - second count not foredoomed to fail - no error in refusal of permanent stay - leave to appeal granted - appeal dismissed Legislation Cited: Criminal Appeal Act 1912
Crimes Act 1914 (Cth)
Interpretation Act 1901 (Cth)
Law and Justice Legislation Amendment (Application of Criminal Code) Act 2001 (Cth)
Criminal Code 1995 (Cth)Cases Cited: R v Agius; R v Abibadra; R v Jandagi; R v Zerafa [2011] NSWSC 367
R v Petroulias [2007] NSWCCA 134; 73 NSWLR 134
R v Steffan (1993) 30 NSWLR 633
R v Matovski (1989) 15 NSWLR 720
R v Dinh [2000] NSWCCA 536; 120 A Crim R 42
R v Einfeld [2008] NSWCCA 215; 71 NSWLR 31
R v King [2003] NSWCCA 399; 59 NSWLR 472
Jago v District Court (NSW) [1989] HCA 46; 168 CLR 23
Williams v Spautz [1992] HCA 34; 174 CLR 509
R v Chairman, County of London Court of Sessions; Ex parte Downes [1954] 1 QB 1
R v Petroulias (No. 1) [2006] NSWSC 788; 177 A Crim R 153
Walton v Gardiner [1993] HCA 77; 177 CLR 378
R v Jasper [2003] NSWCCA 186; 139 A Crim R 329
Doney v The Queen [1990] HCA 51; 171 CLR 207
The Queen v LK [2010] HCA 17; 241 CLR 177
R v B [2008] NSWCCA 85; 76 NSWLR 533
Director of Public Prosecutions v Doot [1973] AC 807
R v JS [2007] NSWCCA 272; 175 A Crim R 108
R v Ronen [2006] NSWCCA 123; 161 A Crim R 30
R v G, F, S and W [1974] 1 NSWLR 31
Woss v Jacobsen (1985) 11 FCR 243
R v Masters (1992) 26 NSWLR 450
R v Simmonds [1969] 1 QB 685
Saffron v R (1988) 17 NSWLR 395
Savvas v The Queen [1995] HCA 29; 183 CLR 1
Truong v The Queen [2004] HCA 10; 223 CLR 122
R v Industrial Appeals Court; Ex parte Barelli's Bakeries Pty Limited [1965] VR 615
R v Industrial Appeals Court; Ex parte Circle Realty Pty Limited [1980] VR 459
CSR Limited v Environment Protection Authority [2000] NSWCCA 373; 110 LGERA 334
Environment Protection Authority v Alkem Drums Pty Limited [2000] NSWCCA 416; 121 A Crim R 152
Burgess v Kaputar Timbers Pty Limited (1999) 91 IR 378
Sloggett v Adams (1953) 70 WN(NSW) 206
Nirta v R (1983) 51 ALR 53
R v H Mokbel (Ruling No. 2) [2009] VSC 547
R v Ansari [2007] NSWCCA 204; 70 NSWLR 89
Ansari v The Queen [2010] HCA 18; 241 CLR 299
R v Saengsai-Or [2004] NSWCCA 108; 61 NSWLR 135
The Queen v Tang [2008] HCA 39; 237 CLR 1
Muslimin v The Queen [2010] HCA 7; 240 CLR 470Category: Principal judgment Parties: Robert Francis Agius (Applicant)
Regina (Respondent)Carol Abibadra (Applicant)
Regina (Respondent)Deborah Judith Jandagi (Applicant)
Kevin Zerafa (Applicant)
Regina (Respondent)
Regina (Respondent)Representation: Mr IM Barker QC/Mr P Coady (Applicant Agius)
Mr P Hastings QC; Mr D Jordan; Mr KH Averre (Applicants Abibadra, Jandagi, Zerafa)
Mr PW Neil SC/Ms S McNaughton (Respondent)
Greg Murray Solicitor (Applicant Agius)Brown Wright Stein (Applicants Abibadra/Jandagi/Zerafa)
Commonwealth Director of Public Prosecutions (Respondent)
File Number(s): Decision under appeal
- Citation:
- R v Agius; R v Abibadra; R v Jandagi; R v Zerafa [2011] NSWSC 367
- Date of Decision:
- 2011-05-04 00:00:00
- Before:
- Simpson J
Judgment
TOBIAS AJA : I agree with Johnson J.
JOHNSON J : These are applications for leave to appeal under s.5F(3)(a) Criminal Appeal Act 1912 by four persons who are to stand trial in the Supreme Court of New South Wales for alleged tax conspiracy offences.
Each of the Applicants (Robert Francis Agius, Carol Abibadra, Deborah Judith Jandagi and Kevin Zerafa) has been arraigned on an indictment containing two counts of conspiracy, described in the following terms:
"1. Between about 1 January 1997 and about 23 May 2001 at Sydney, New South Wales and elsewhere did conspire with each other and with Owen Trevor DANIEL to defraud the Commonwealth.
Contrary to section 86(1) and section 29D of the Crimes Act 1914 (Cth). (Law Part Code 11102).
2. Between about 24 May 2001 and about 10 April 2008 at Sydney, New South Wales and elsewhere did conspire with each other and with Owen Trevor DANIEL to dishonestly cause a loss, or to dishonestly cause a risk of loss, to a third person, namely the Commonwealth, knowing or believing that the loss would occur or that there was a substantial risk of the loss occurring.
Contrary to section 135.4(5) of the Criminal Code . (Law Part Code 41506)."
Each of the Applicants applied to the trial Judge, Simpson J, in advance of trial for certain interlocutory orders. On 4 May 2011, Simpson J gave reasons for refusing the applications of the Applicants: R v Agius; R v Abibadra; R v Jandagi; R v Zerafa [2011] NSWSC 367.
In particular, her Honour refused the application for a permanent stay of the second count in the indictment.
On 6 May 2011, each of the Applicants filed a Notice of Application for Leave to Appeal Against an Interlocutory Order for the purpose of s.5F Criminal Appeal Act 1912 contending that her Honour had erred in declining to permanently stay the second count in the indictment, and seeking that this Court make such an order.
The applications for leave to appeal were brought before this Court as a matter of urgency and proceeded to hearing on 13 May 2011. Although a jury panel has yet to be assembled for the purposes of the trial, this Court was informed that it was the desire of the trial Judge to commence the trial within the next few weeks.
Applications for Leave to Appeal
This Court was informed that the trial Judge had not been requested, for the purposes of s.5F(3)(b) Criminal Appeal Act 1912 , to certify that the judgment or order in this case was a proper one for determination on appeal. If her Honour had so certified, then the matters would proceed by way of appeal in this Court without the need for the Court of Criminal Appeal to grant leave to appeal: R v Petroulias [2007] NSWCCA 134; 73 NSWLR 134 at 136 [8].
Accordingly, it falls to this Court to determine whether the Applicants should have leave to appeal from Simpson J's refusal to permanently stay the second count on the indictment.
This Court has said that leave will only be granted where the decision which is the subject of the s.5F application is attended with sufficient doubt so as to warrant the matter being argued on appeal ( R v Steffan (1993) 30 NSWLR 633 at 644-645), or where the interests of justice otherwise require the intervention of the Court at this stage of the proceedings ( R v Matovski (1989) 15 NSWLR 720 at 723; R v Dinh [2000] NSWCCA 536; 120 A Crim R 42 at 48 [34]). The Court should bear in mind the undesirability of interrupting criminal proceedings by the bringing of a s.5F application: R v Einfeld [2008] NSWCCA 215; 71 NSWLR 31 at 37 [23]-[25].
It is clear that the refusal of an application for a permanent stay falls within the meaning of the words "interlocutory judgment or order" in s.5F: R v King [2003] NSWCCA 399; 59 NSWLR 472 at 477 [22].
If this Court refused the Applicants leave to appeal under s.5F, the refusal would not preclude any other appeal following conviction on the matter to which the refused applications related: s.5F(6). At times, this Court will refuse leave to appeal under s.5F because the issues sought to be advanced on appeal involve matters which may properly be left to consideration on appeal after trial if a conviction results.
Although this Court is asked to proceed on the present applications upon a very limited documentary foundation, the Court was urged to grant leave to appeal and to consider and determine the appeals on their merits. It was submitted for the Applicants that this course was appropriate given the significant impact upon the length of the trial should a permanent stay of the second count be granted. It was also submitted that an important question was raised involving the proper construction and application of provisions in the Criminal Code 1995 (Cth) ("the Code"), and that similar issues are involved in a number of other pending prosecutions for alleged tax conspiracy. It was submitted that it was important to the progress of the present prosecutions and other pending prosecutions that this Court grant leave and proceed to hear and determine the appeals on their merits.
The Crown did not seek to challenge these assertions and did not oppose a grant of leave to appeal in these cases.
The Claim of Abuse of Process - The Second Count is Foredoomed to Fail
The principles concerning abuse of process to be applied on an application such as this are not in doubt.
It has been emphasised that the power to stay permanently a criminal prosecution will be used only in most exceptional circumstances: Jago v District Court (NSW) [1989] HCA 46; 168 CLR 23 at 31. The onus of satisfying the Court that there is an abuse of process lies upon the party alleging it and the onus is a heavy one: Williams v Spautz [1992] HCA 34; 174 CLR 509 at 529.
Although the jurisdiction to stay proceedings as an abuse of process is wide ranging, it is not without limits. It has been said that the discretion cannot be exercised to stop proceedings because the evidence against an accused person is weak or because (if it be the case) the Bench disapproves of the prosecution: R v Chairman, County of London Court of Sessions; Ex parte Downes [1954] 1 QB 1 at 6; R v Petroulias (No. 1) [2006] NSWSC 788; 177 A Crim R 153 at 174 [63].
The Applicants submit that the second count should be permanently stayed on the basis that it is foredoomed to fail: Walton v Gardiner [1993] HCA 77; 177 CLR 378 at 393, 411. To succeed in an application for a permanent stay on this basis, it is necessary for the Applicants to show that the proceedings "can be clearly seen to be foredoomed to fail" ( Walton v Gardiner at 393 per Mason CJ, Deane and Dawson JJ) or that they will "inevitably and manifestly fail" ( Walton v Gardiner at 411 per Brennan J).
Although these statements in Walton v Gardiner were made in the context of a medical disciplinary case, this formulation of the principles of abuse of process has been applied where a permanent stay is sought with respect to the trial of offences being prosecuted on indictment: R v Jasper [2003] NSWCCA 186; 139 A Crim R 329 at 335 [18], R v Petroulias (No. 1) at 164-165 [26], 173-179 [55]-[85]. If the application succeeds, the operation of the criminal justice system will not proceed further with respect to the second count. There will be no trial at which the trial Judge may be called upon to determine whether the Applicants have a case to answer, applying the principles in Doney v The Queen [1990] HCA 51; 171 CLR 207. All of this underlines the exceptional nature of the remedy which the Applicants seek.
The question here is whether the Applicants have demonstrated error on the part of Simpson J and established an entitlement to the exceptional remedy of a permanent stay of the second count upon the basis that it is foredoomed to fail.
The Present Applications
Limited documentation was placed before this Court at the hearing of the present applications. Apart from written submissions relied upon before Simpson J and in this Court, the Court was taken to the indictment (see [3] above) and a document entitled "Particulars of Conspiracy and Overt Acts" relied upon by the Crown.
Some factual background may be derived from Simpson J's judgment at [5]-[6] (the Crown is described as the "CDPP" ):
"5 Notwithstanding that the indictment alleges two counts of conspiracy against each accused, what the CDPP in fact alleges is a single conspiracy, extending over the whole of the time frame specified in the two charges - that is, from 1 January 1997 to 10 April 2008. Particulars of the allegation that have been provided to the accused explain the nature of the conspiracy, and the fraud, alleged. From those particulars the following may be derived. The CDPP alleges:
* Mr Agius was an expatriate Australian accountant practising in Vanuatu;
* Mr Daniel (now deceased) was an accountant and principal of an accountancy firm by the name of 'Owen T Daniel & Co Burwood' ('OTD');
* Mr Zerafa and Ms Jandagi were accountants employed by or working at OTD;
* Ms Abibadra, while not formally qualified as an accountant, worked as such at OTD;
(Mr Zerafa, Ms Jandagi and Ms Abibadra were referred to as 'the OTD accused'.)
* sometime in early 1997 Mr Agius and Mr Daniel made an agreement to defraud the Commonwealth by depriving it of income tax legitimately due to it by various corporate clients of OTD;
* put simply, they did this by a scheme that involved, first, falsely inflating the legitimately tax deductible expenses of the companies involved, thus dishonestly reducing the income tax that would be found to be payable, and, second, by concealing or disguising income of the companies as loans, again reducing the amount of income tax that would be found to be payable.
6 It is the CDPP's case that the scheme was always a scheme to defraud the Commonwealth of revenue due to it by way of taxation, and that it continued to operate in essentially the way described throughout the period of the conspiracy. The sole reason for bringing two counts against each accused lies in a radical change in the legislative regime governing offences concerning 'the proper administration of government' that was introduced into the Criminal Code with effect from 24 May 2001. There has at all relevant times existed a statutory provision creating an offence of conspiracy to defraud the Commonwealth, although it has been expressed in different ways. The change in the language of the legislation explains the change in the language in which the two charges are expressed. It is important to emphasise that what the CDPP alleges is a continuing course of conduct beginning with the agreement in early 1997 and its progressive implementation thereafter, until it came to an end in April 2008."
According to paragraph 6 of the document entitled "Particulars of Conspiracy and Overt Acts" , the Crown contends that an agreement to defraud the Commissioner of Taxation of tax revenue was formed in Sydney between about 1 January 1997 and 1 May 1997, with the original parties to the agreement being at least the Applicant Agius and Owen Trevor Daniel (now deceased). It is the Crown case that the Applicant Abibadra joined the conspiracy by 13 May 1997, the Applicant Jandagi joined the conspiracy by the end of 1998 and the Applicant Zerafa joined the conspiracy by the end of 2000.
Put shortly, the Applicants submitted before Simpson J that Count 2 was foredoomed to fail because:
(a) the Crown contended that each of the Applicants had entered into an agreement for the purpose of the conspiracy by 31 December 2000 at the latest, and certainly well before 24 May 2001, the commencement date for the conspiracy alleged in the second count;
(b) the evidence relied upon by the Crown with respect to the agreement pointed to the entering into an agreement before 23 May 2001 and there was no evidence at all that any of the Applicants entered into or joined an agreement on or after 24 May 2001;
(c) in these circumstances, what was said to be the actus reus of conspiracy, namely entering into an agreement, did not occur in the period on or after 24 May 2001, the period specified for the offence contained in the second count, being an offence under s.135.4 of the Code;
(d) no transitional provision in the Code or other legislation assisted the Crown to allow an offence to be charged in the manner contained in the second count.
Relevant Statutory Provisions
Simpson J set out the relevant statutory provisions (apart from transitional provisions) at [8]-[17] of her Honour's judgment. This summary was not challenged before this Court and it is convenient to incorporate it in this judgment:
"8 Immediately prior to 24 May 2001 and as at 1 January 1997, the relevant legislation was s 29D and s 86(1) of the Crimes Act . Those sections then provided as follows:
'29D Fraud
A person who defrauds the Commonwealth or a public authority under the Commonwealth is guilty of an indictable offence.
Penalty: ... imprisonment for 10 years ...
86 Conspiracy
(1) A person who conspires with another person to commit an offence against a law of the Commonwealth punishable by imprisonment for more than 12 months ... is guilty of the offence of conspiracy to commit that offence and is punishable as if the offence to which the conspiracy relates had been committed.'
9 Section 86(1) created a general offence of conspiracy to commit an offence against a law of the Commonwealth, and prescribed the penalty. Section 86(2) specified a more severe penalty where the law of the Commonwealth against which the accused conspired to commit an offence was s 29D. It is worth noting that s 86(2) did not, by itself or in conjunction with any other provision, create an offence. It is merely a provision with respect to penalty - that is, with respect to the penalty applicable to an offence created by s 86(1) in combination with s 29D.
10 Sub-section (3) of s 86 spelled out essential conditions for the conviction of an accused person under s 86. Those conditions were stated as:
'(a) the person must have entered into an agreement with one or more other persons; and
(b) the person and at least one other party to the agreement must have intended that an offence would be committed pursuant to the agreement; and
(c) the person or at least one other party to the agreement must have committed an overt act pursuant to the agreement.'
I pause to note that the Crimes Act did not contain a definition of the offence of conspiracy.
11 On 15 March 1995 the Criminal Code Act 1995 received Royal Assent. It was proclaimed to commence on 1 January 1997. By s 3 of the Criminal Code Act , the Schedule thereto took effect as the Criminal Code ('the Code'). The Code contained various provisions codifying certain offences against Commonwealth law. Notably absent from the Code at that time were any provisions concerning conspiracy to defraud the Commonwealth. The Code did contain, however, in s 11.5, provisions concerning conspiracy to commit offences against Commonwealth law. That did not affect the continued operation of s 86(2), s 86(3) and s 29D of the Crimes Act .
12 The Code introduced quite novel terminology into the statutory expression of criminal law. All of its linguistic features that need here be noted concern the approach to the long entrenched notions that (in general) criminal culpability depended upon proof, by the prosecution, of both a physical act constituting the crime (formerly known as 'the actus reus ') and an accompanying mental element (formerly known as a 'guilty mind', or ' mens rea ').
13 By s 3.1(1) of the Code, these elements have been re-badged as 'physical elements' and 'fault elements'. By s 3.2, a person may not be found guilty of committing an offence unless the prosecution has proved:
'(a) the existence of such physical elements as are, under the law creating the offence, relevant to establishing guilt; [and]
(b) in respect of each such physical element for which a fault element is required, one of the fault elements for the physical element.'
By s 4.1(1), a physical element of an offence may be:
'(a) conduct; or
(b) a result of conduct; or
(c) a circumstance in which conduct, or a result of conduct, occurs.'
By s 4.1(2), 'conduct' means:
'an act, an omission to perform an act or a state of affairs.';
and 'engage in conduct' means:
'(a) do an act; or
(b) omit to perform an act.'
14 Section 29D and s 86(2) (but not the balance of s 86) were repealed with effect from 24 May 2001. This was achieved by the enactment of the Criminal Code Amendment (Theft, Fraud, Bribery and Related Offences) Act 2005 ('the Code Amendment Act'). By the Code Amendment Act, a new Chapter 7 was inserted into the Code.
15 Chapter 7 of the Code is headed 'The Proper Administration of Government'. Section 135.4 is to be found in Chapter 7. It relevantly provides as follows:
' 135.4 Conspiracy to defraud
Obtaining a gain
...
Causing a loss
...
(5) A person is guilty of an offence if:
(a) the person conspires with another person to dishonestly cause a loss, or to dishonestly cause a risk of loss, to a third person; and
(b) the first-mentioned person knows or believes that the loss will occur or that there is a substantial risk of the loss occurring; and
(c) the third person is a Commonwealth entity.
Penalty: Imprisonment for 10 years.
...
General provisions
(9) For a person to be guilty of an offence against this section:
(a) the person must have entered into an agreement with one or more other persons; and
(b) the person and at least one other party to the agreement must have intended to do the thing pursuant to the agreement; and
(c) the person or at least one other party to the agreement must have committed an overt act pursuant to the agreement.
...'
16 Thus, as and from 24 May 2001, the offence of conspiracy to defraud the Commonwealth was wholly contained (and codified) in s 135.4 of the Code.
17 What remained of s 86 after the proclamation of the commencement of the Code Amendment Act was repealed with effect from 15 December 2001. That repeal was achieved by the enactment of the Law and Justice Legislation Amendment (Application of Criminal Code) Act 2001 ('the Law and Justice Legislation Amendment Act'). That repeal has little, if any, bearing upon the issue for present determination. However, since, on behalf of all accused, considerable reliance was placed upon one aspect of the repealing legislation, it is necessary to set out the relevant provisions, and that can conveniently be done here."
Simpson J set out pertinent transitional provisions at [18]-[20]. Once again, it is appropriate to cite those paragraphs:
"18 Both the Code Amendment Act and the Law and Justice Legislation Amendment Act necessarily contained transitional provisions.
19 The transitional provisions of the Code Amendment Act (that is, those relating to the repeal of s 29D and s 86(2) of the Crimes Act and applicable to the pre-Code offence of conspiracy to defraud the Commonwealth) were to be found in Item 418 of Part 2 of Schedule 2, and are in the following terms:
' 418 Transitional - pre-commencement offences
(1) Despite the amendment or repeal of a provision by this Schedule, that provision continues to apply, after the commencement of this item, in relation to:
(a) an offence committed before the commencement of this item; or
(b) proceedings for an offence alleged to have been committed before the commencement of this item; or
(c) any matter connected with, or arising out of, such proceedings;
as if the amendment or repeal had not been made.
(2) Subitem (1) does not limit the operation of section 8 of the Acts Interpretation Act 1901.'
20 The transitional provisions of the Law and Justice Legislation Amendment Act (that is, those repealing the balance of s 86 of the Crimes Act and applicable to the pre-Code offence of conspiracy other than conspiracy to defraud the Commonwealth) were to be found in s 4 thereof, and were in the following terms:
'4 Application of amendments
(1) Subject to subsection (3), each amendment made by this Act applies to acts and omissions that take place after the amendment commences.
(2) For the purposes of this section, if an act or omission is alleged to have taken place between 2 dates, one before and one on or after the day on which a particular amendment commences, the act or omission is alleged to have taken place before the amendment commences.
(3) ...'."
The Decision at First Instance
Simpson J recounted the relevant legislative history, including the repeal of ss.29D and 86 Crimes Act 1914 (Cth) in 2001 and the commencement of s.135.4 of the Code on 24 May 2001. Her Honour referred to the transitional provisions.
Her Honour then encapsulated the issues requiring determination in the following way (at [21]-[23]):
"21 The proposition for which all accused argued may be stated shortly and simply. It is that, given the acknowledgement on behalf of the CDPP that the allegations against each accused involve a single conspiracy spanning the periods of operation of two legislative regimes, it is not open to the CDPP to charge two separate offences. That, in turn, depends upon a further series of simple propositions: that the essence of a conspiracy is entry into an agreement to commit a crime; that the crime of conspiracy is complete upon the relevant agreement being made; and that, in the absence of evidence of entry into an agreement after the commencement of the second legislative regime, the CDPP is unable to prove a conspiracy during the time to which that regime relates.
22 Shortly and simply stated it may be, but the argument calls for some examination of the statutory provisions associated with the enactment of the Code, as well as some common law principles concerning the offence of conspiracy.
23 As was the case in respect of the Crimes Act offence of conspiracy to defraud the Commonwealth, 'conspiracy' is not explicitly defined in the Code. However, there are significant pointers to the meaning of the term as it is used in the Code, including in s 135.4(9). These pointers indicate that the framers of the Code intended to adopt and perpetuate the well established and well understood notion of conspiracy at common law."
Her Honour set out a number of principles concerning the common law crime of conspiracy at [25]-[30], and these principles (apart from the last sentence in [30]) are not challenged by the Applicants. Her Honour said:
"25 The essence of the offence of conspiracy is agreement. It has long been accepted that, at common law, a conspiratorial agreement is the agreement of the parties to do an unlawful act, or to do a lawful act by unlawful means: Jones (1832) 4 B & Ad 345; 110 ER 485 (cited in Gillies at p 1 and p 71).
26 That characterisation has repeatedly been adopted. That did not change when the common law offence was given statutory recognition, or took statutory form. That, no doubt, is why the Crimes Act did not, and the Code does not, attempt a definition of conspiracy.
27 It is that characterisation that provides the foundation for the argument advanced on behalf of the accused.
28 It is well established that the crime of conspiracy is complete when the agreement is made: Gillies, p 16. Up to a point, that has been modified by statute, in that both s 86(3)(c) of the Crimes Act required, and s 135.4(9)(c) of the Code requires, before an accused can be convicted of the offence, proof of at least one overt act pursuant to the agreement.
29 Notwithstanding that the crime is complete when the agreement is made, it is equally well established that conspiracy is a continuing offence: Director of Public Prosecutions v Doot [1973] AC 807 at 827.
30 While overt acts are frequently the basis for proof of the crime of conspiracy, they themselves did not, at common law or under the Crimes Act , constitute the actus reus of the conspiracy. That remained the formation of the agreement. (As will appear below, that is not an entirely accurate formulation. More accurately, it seems to me, that actus reus was the participation in the agreement.)"
After referring to The Queen v LK [2010] HCA 17; 241 CLR 177 and R v B [2008] NSWCCA 85; 76 NSWLR 533, her Honour said at [33]-[36]:
"33 The substance of the submissions made on behalf of the OTD accused was encapsulated in a single sentence, as follows:
'19. Whilst conspiracy may be described as a continuing offence, any criminal liability arising from an agreement to defraud the Commonwealth formed during the currency of s 29D of the Crimes Act could not continue after s 29D was repealed and replaced by s 135.4(5) of the Code .'
The submission went on to refer to the transitional provisions, to which I will return.
34 I am satisfied that the submissions are based upon a fundamental misconception. That misconception is that the offence of conspiracy depends upon the formation of, or entry into, an agreement, as distinct from the existence of, or participation in, such an agreement. The submissions were to the effect that, since the CDPP alleges that the agreement was made during the currency of s 29D of the Crimes Act, then, absent a second agreement formed, made, or entered into after the commencement of s 135.4(5) of the Code, there can be no offence of conspiracy contrary to that section.
35 That is, as I have indicated, fundamentally wrong. What the offence of conspiracy depends upon is the existence of, or participation in, an agreement, and not the precise timing of its formation.
36 A parallel may be found in the decision in Doot, to which reference has already been made. Put shortly, in that case the House of Lords held that a conspiracy could be found to exist, notwithstanding that there was no evidence that the necessary agreement was formed within the territorial jurisdiction of the court in which the offence was prosecuted"
Her Honour set out extracts from the decision of the House of Lords in Director of Public Prosecutions v Doot [1973] AC 807 and then continued at [38]-[41]:
"38 ...The analogy with the present case is obvious. If an agreement that had its origin extra-territorially can give rise to an offence within territorial jurisdiction, provided that the agreement continues in existence and there is some overt act towards its implementation committed within territorial jurisdiction, so also can an agreement that has its origin outside the temporal limits of the applicable legislation, provided that the agreement continues in existence and there is some overt act committed towards its implementation.
39 Moreover, regard must be had to the provisions of the Code to which I have referred above. While it is true that a necessary element to the offence of conspiracy is a physical element, and the physical element upon which the CDPP relied is 'conduct', that term is given an extended definition, so as to include 'a state of affairs' (s 4.1(2)). There is no escaping the conclusion that 'a state of affairs' includes the existence (continuing) of an agreement to defraud the Commonwealth.
40 It would be highly artificial - to an absurd degree - to suggest that an agreement that had its inception prior to the commencement of the relevant provisions of the Code, but that continued, and continued to be implemented, thereafter, could not be prosecuted under the Code because the alleged conspirators failed, on the change of legislation, to renew, or remake, their agreement.
41 That, is, in my opinion, sufficient to dispose of the present issue."
Her Honour then turned to consider submissions made with respect to the transitional provisions (at [42]-[47]), before concluding at [48]):
"It may be correct that the offence charged is a single, continuing, offence. What calls for two separate counts is that the relevant conduct is criminalised by two different legislative regimes."
Her Honour noted (at [49]-[51]) submissions advanced by the Crown which were not accepted. However, as it happened, these submissions did not bear upon the outcome of the application to permanently stay the second count.
Her Honour held that there was no basis to permanently stay the second count and refused the application.
The Applicants' Grounds
The Applicants contend that her Honour has erred in various respects. Each of the Applicants Abibadra, Jandagi and Zerafa rely upon the following grounds:
"1) Her Honour erred in concluding that an offence of conspiracy to defraud the Commonwealth, pursuant to s 135.4(5) of the Criminal Code Act 1995 (the Code), could be established on the basis of an agreement that was entered into by each of the applicants before s 135.4(5) commenced operation. In particular:
i) Her Honour erred in the application of the express statutory modifications to the common law of conspiracy brought about by section s 135.4(9) of the Code.
ii) Consequently, her Honour misconstrued the physical element of 'conspires' in s 135.4(5) of the Code."
The Applicant Agius relies upon the following grounds of appeal:
"1 The learned primary judge erred in law;
(a) in not finding that proceedings on count 2 could not succeed and were therefore an abuse of process;
(b) in not finding there was no evidence of an agreement as required by Criminal Code s. 135.4(9);
(c) in not finding such evidence was necessary to sustain count 2;
(d) in holding that although the indictment charged two separate conspiracies the Crown need prove only one agreement to obtain two convictions, one on each count;
(e) in holding that the offence of conspiracy does not depend upon evidence of the formation of or entry into an agreement (whether the formation be proved by direct or inferential evidence).
2. The learned primary judge erred in concluding that an offence of conspiracy to defraud the Commonwealth, pursuant to s.135.4(5) of the Criminal Code Act 1995 (the Code) could be established on the basis of an agreement that was entered into by each of the applicants before s 135.4(5) commenced operation. In particular:
(a) Her Honour erred in the application of the express statutory modifications to the common law of conspiracy brought about by section s 135.4(9) of the Code.
(b) Consequently, her Honour misconstrued the physical element of 'conspires' in s 135.4(5) of the Code."
Submissions of the Parties
In written submissions made jointly on behalf of the Applicants Abibadra, Jandagi and Zerafa, Mr Hastings QC and Messrs Jordan and Averre of counsel, submitted that her Honour had erred in concluding that an offence of conspiracy to defraud the Commonwealth pursuant to s.135.4(5) of the Code could be established on the basis of an agreement that was entered by each of the Applicants before the offence created by that provision commenced operation. In particular, it was submitted that:
(a) her Honour erred in concluding (at [34]-[35]), that at common law the actus reus of the offence of conspiracy was the existence of, or participation in, the agreement, whereas the actus reus was the entry into the agreement ( The Queen v LK at 205-206 [57], 207-208 [62]-[64]);
(b) her Honour erred in the application of the express statutory modifications to the common law of conspiracy brought about by s.135.4(9) of the Code;
(c) consequently, her Honour (at [39] and [45]) misconstrued the physical element of "conspires" in s.135.4(5) of the Code as being constituted by "a state of affairs" , when in fact the offence of conspiracy requires conduct comprising acts of entering into the agreement and the commission of an overt act.
These submissions were developed by reference to passages in the judgments of the High Court in The Queen v LK and other authorities. It was submitted that the principles in Director of Public Prosecutions v Doot had been overtaken by specific provisions contained in the Code. In particular, it was submitted that her Honour had not paid due regard to what was said to be the express statutory modification in s.135.4(9) which applies to conspiracy under the Code.
It was further submitted for these Applicants that her Honour had erred in characterising the circumstances of this case as attracting the "state of affairs" provision in the Code. A consequence of this, it was submitted, is that her Honour erred in the construction and application of the transitional provisions.
It was submitted for these Applicants that acceptance of their submissions did not have the alarming consequences suggested by the Crown. It was submitted that the Crown had sought to exploit the loose concept of conspiracy offences by alleging a course of conduct over a period in excess of 10 years, involving arrangements in which different taxpayers participated at different times and in different circumstances. It was submitted for these Applicants that, if there is evidence of significant criminal activity by the Applicants after 24 May 2001, the prosecution is entitled to charge substantive offences against the Code.
Mr Barker QC, for the Applicant Agius, advanced similar arguments to those for the other Applicants. He too sought to rely upon passages in the judgment of the High Court in The Queen v LK . In addition, he submitted that whilst the Crown says there was no second agreement, it maintained (inconsistently) that it can rely on s.4.1(1)(a) and (2) of the Code to satisfy the physical element required by s.135.4(9)(a), that is to say "the person must have entered into an agreement" .
Mr Barker QC submits that the offence of conspiracy requires proof of the statutory physical element of entry into an agreement (s.135.4(9)(a)) and proof of the commission of an overt act (s.135.4(9)(c)). He submits that her Honour was wrong in holding that the physical element required by s.135.4(5)(a) could be constituted by a "state of affairs" . He submits that the clear language of the Code must be adhered to: R v JS [2007] NSWCCA 272; 175 A Crim R 108. Mr Barker QC submits that the effect of her Honour's interpretation of s.135.4(9)(a) is to give it retrospectivity before 24 May 2001 and, in his submission, this must be wrong.
The Crown submits that her Honour did not err in refusing to permanently stay the second count in the indictment, and developed arguments in support of this submission.
Resolution of Competing Submissions
Before moving to an assessment and determination of the issues raised by the Applicants, it is of passing interest that a prosecution for a conspiracy of long duration, interrupted by statutory amendment, has occurred before this case. In R v Ronen [2006] NSWCCA 123; 161 A Crim R 30, three persons were charged with two offences of conspiracy to defraud the Commonwealth of tax revenue. The Crown alleged that a single conspiracy was on foot from 1991 to 2001. As Howie J observed at 303 [4], there were two counts on the indictment, reflecting the fact that during the period of the conspiracy, there was a change in September 1995 to the statutory provisions prescribing the offences charged. The Appellants in that case were convicted on both counts. It does not seem that any argument had been advanced in R v Ronen that a fresh agreement, formed within the period of the second offence charged on the indictment, needed to be proved by the Crown. Of course, that case predated the commencement of relevant provisions of the Code. However, the scenario was the same as described by Simpson J in the passage cited at [32] above - the conspiracy charged was a single, continuing offence with two separate counts required as the relevant conduct was criminalised by two different legislative regimes.
It is useful to consider the issues posed for determination by these applications using the categories of suggested error advanced by the Applicants at [37] above, and additional areas touched upon in submissions.
Alleged Error Concerning the Actus Reus of Conspiracy at Common Law
Simpson J accepted that the essence of the offence of conspiracy at common law is agreement and that it is well established that the crime of conspiracy is complete when the agreement is made. Her Honour observed that, notwithstanding that the crime is complete when the agreement is made, it is equally well established that conspiracy is a continuing offence.
Thus far, there is no dispute between the parties as to her Honour's description of the common law offence of conspiracy.
Her Honour also observed, uncontroversially, that whilst overt acts are frequently the basis for proof of the crime of conspiracy, they themselves did not at common law, or under the Crimes Act 1914 (Cth) , constitute the actus reus of conspiracy.
Her Honour observed (at [30]) that the actus reus of conspiracy was the participation in the agreement. Her Honour stated (at [35]) that the offence of conspiracy depends upon the existence of, or participation in, an agreement, and not the precise timing of the formation of the agreement. Her Honour drew an analogy with the circumstances in Director of Public Prosecutions v Doot in reaching this view (at [36]-[38]).
It is necessary to say something more concerning the propositions that, firstly, the crime of conspiracy at common law is complete when the agreement is made and, secondly, that conspiracy is a continuing offence.
The decision of the House of Lords in Director of Public Prosecutions v Doot was called in aid by this Court in R v G, F, S and W [1974] 1 NSWLR 31 to explain the concept of conspiracy as a continuing offence, and the application of that concept in a temporal respect, and not merely concerning geographical jurisdiction. In that case, the trial Judge had held that, as an unlawful agreement had been made by a certain date, the crime of conspiracy had, by then, been committed. The Court of Criminal Appeal (Kerr CJ, McClemens CJ at CL and Lee J) disagreed. Their Honours said at 43B (emphasis added):
"But, the decision of the House of Lords in Director of Public Prosecutions v. Doot makes it clear that it is not correct to consider the crime of conspiracy as nothing more than the making of the initial unlawful agreement. The decision makes it clear that, although the essence or gist of conspiracy is the unlawful agreement made by the conspirators, and not the acts done under it (which individually may or may not be criminal), conspiracy as a crime is committed wherever and whenever it is shown that the agreement, the unlawful concert, exists between the conspirators ."
Their Honours then referred to passages in the judgments of Viscount Dilhorne and Lord Pearson in Director of Public Prosecutions v Doot , and then stated at 44D-F (emphasis added):
"From these statements we deduce the conclusion earlier referred to, that the crime of conspiracy is a crime not limited to the making of the unlawful agreement, but committed whilst ever the unlawful agreement is in existence. The agreement may exist but for a moment - because the conspirators are detected immediately after they make their agreement - or it may exist for years. Whilst ever the unlawful purpose or concert is shown to be in existence between the conspirators, the conspirators are conspiring and the crime of conspiracy is being committed. It is a crime of duration, a continuing offence . So viewed the overt acts proved will individually or collectively, of course, be indicative of the formation earlier of the unlawful purpose, but their full role is to establish the existence of the unlawful purpose from that earlier point in time to whenever the conspiracy was discovered. That will be the crime of conspiracy charged in the indictment. Conspiracy is invariably charged as having been committed between certain dates - it is the conspiring, the continuation in existence of the unlawful purpose, between the dates alleged which is the crime charged, and which is the matter to be proved."
The characterisation of conspiracy as a crime of duration, a continuing offence which lasts as long as it is being performed, has been emphasised: Woss v Jacobsen (1985) 11 FCR 243 at 250; R v Masters (1992) 26 NSWLR 450 at 458F.
Support for the Crown submission in the present case may also be found in the judgment of Fenton-Atkinson J in R v Simmonds [1969] 1 QB 685 at 696, cited with approval by Hope JA in Saffron v R (1988) 17 NSWLR 395 at 422. Fenton-Atkinson J said:
"This argument is based on a complete fallacy as to the nature of conspiracy. Of course, if two men agree on a particular day to embark on a course of criminal conduct over a period of months, the offence of conspiracy is committed at the moment of agreement. But they remain conspirators and their conspiracy continues until either the criminal purpose has been achieved or their agreement has been brought to an end.
The offence of conspiracy has clearly over the centuries been committed by being a member of what in the old books is referred to as a 'confederacy' - that is to say, being one of two or more persons acting or planning to act in concert under some agreement - be it express or implied - in pursuit of a criminal design.
Furthermore, it is well-established law that if A and B conspire together to carry on, for example, a course of fraudulent trading, C may join in (or in the old phraseology 'adhere to') the conspiracy at a later date and then A may drop out and be replaced by D. But it all remains a single conspiracy as long as all of them are for the period of their participation acting in combination to achieve the same criminal objective."
In Savvas v The Queen [1995] HCA 29; 183 CLR 1 at 8, Deane, Dawson, Toohey, Gaudron and McHugh JJ said:
"It is commonplace that the ingredients of the offence of conspiracy are complete once there is agreement between two or more persons [Gerakiteys v R(1984) 153 CLR 317 at 327, 334; 51 ALR 417; Kamara v Director o f Public Prosecutions[1974] AC 104 at 119] . But it is equally plain that the conspiracy does not end with the making of the agreement. 'It will continue so long as there are two or more parties to it intending to carry out the design' [Director of Public Prosecutions v Doot[1973] AC 807 at 823. See also R v G, F, S and W [1974] 1 NSWLR 31 at 43-4] . "
In Truong v The Queen [2004] HCA 10; 223 CLR 122, Gleeson CJ, McHugh and Heydon JJ observed at 143-144 [35]:
"Furthermore, the conspiracy was alleged to have continued in existence, and to have been completed by performance. Although a crime of conspiracy has been committed, and in that sense is complete, once an agreement to commit a crime has been made, conspiracy is a continuing offence. It is an error to think that the crime comes to an end once the agreement has come into existence. That is the error that was rejected by this court in Savvas v R [ (1995) 183 CLR 1; 129 ALR 319]. The point was explained b y Lord Pearson in Director of Public Prosecutions v Doot [[1973] AC 807 at 827] :
A conspiracy involves an agreement expressed or implied. A conspiratorial agreement is not a contract, not legally binding, because it is unlawful. But as an agreement it has its three stages, namely (1) making or formation (2) performance or implementation (3) discharge or termination. When the conspiratorial agreement has been made, the offence of conspiracy is complete, it has been committed, and the conspirators can be prosecuted even though no performance has taken place ... But the fact that the offence of conspiracy is complete at that stage does not mean that the conspiratorial agreement is finished with. It is not dead. If it is being performed, it is very much alive. So long as the performance continues, it is operating, it is being carried out by the conspirators, and it is governing or at any rate influencing their conduct. The conspiratorial agreement continues in operation and therefore in existence until it is discharged (terminated) by completion of its performance or by abandonment or frustration or however it may be."
In my view, the analogy drawn by Simpson J in this case by reference to Director of Public Prosecutions v Doot is apt. The fact that the decision in that case concerned geographical jurisdiction is not the point and is no reason to place the decision to one side. Reliance upon the decision, in a temporal sense, to understand the nature of conspiracy as a continuing offence is both appropriate and helpful to the resolution of the issues in the present case. As the cases referred to at [51]-[56] above make clear, other Courts in Australia have utilised the decision in Director of Public Prosecutions v Doot in precisely this way.
The concept of a continuing offence has been considered in Australia, principally in the context of regulatory offences, including alleged environmental or industrial safety offences. See, for example, in Victoria - R v Industrial Appeals Court; Ex parte Barelli's Bakeries Pty Limited [1965] VR 615 at 620 and R v Industrial Appeals Court; Ex parte Circle Realty Pty Limited [1980] VR 459 at 461-462, and in New South Wales - CSR Limited v Environment Protection Authority [2000] NSWCCA 373; 110 LGERA 334 at 340-342 [39]-[53]; Environment Protection Authority v Alkem Drums Pty Limited [2000] NSWCCA 416; 121 A Crim R 152 at 154-156 [7]-[16], 161-166 [43]-[79]; Burgess v Kaputar Timbers Pty Limited (1999) 91 IR 378 at 382.
A passage cited frequently in this State concerning the nature of a continuing offence appears in the judgment of Street CJ in Sloggett v Adams (1953) 70 WN(NSW) 206 at 208 (emphasis added):
"'The question whether the offence which has been committed is a continuing offence, or one which was committed once and for all at a specified time, depends upon consideration of the language of the Act in question. Some offences once committed are complete and concluded and exist only in the past. Other offences, however, are continuing offences and are committed day by day so long as the state of affairs which is forbidden continues to exist, and the person responsible for creating that state of affairs is liable day by day for those offences . The test, it seems to me, is one which was prescribed in Ellis v Ellis [(1896) P 251 at 254] , by Sir Francis Jeune, who said: 'The test whether an offence is to be treated in law as continuous is, I think, whether its gravamen is to be found in something which the offender can, at will, discontinue'."
To my mind, this general description of a continuing offence is helpful in understanding the way in which the offence of conspiracy at common law was said to constitute a continuing offence. Of particular relevance is the statement of Street CJ that continuing offences "are committed day by day so long as the state of affairs which is forbidden continues to exist, and the person responsible for creating that state of affairs is liable day by day for those offences" . This is an apt description of a conspiracy and, as it happens, utilises the term "state of affairs" , a phrase to which I will return.
Further support for her Honour's conclusion may be found in the statement that, in cases of conspiracy, it is not necessary to prove formation of the agreement at some definite time: Nirta v R (1983) 51 ALR 53 at 61. Although a conspiracy may be established by proving an agreement which has never been implemented, it is not necessary in the usual case of conspiracy where a succession of overt acts are relied upon, to establish the date when, or the date before which, the conspiratorial agreement was made: Saffron v R at 419. The prosecution is not bound to define the exact time at which the agreement began or the exact act which marked its inception: Saffron v R at 436-437; R v H Mokbel (Ruling No. 2) [2009] VSC 547 at [17].
With respect, I agree with the statement of Simpson J at first instance that the offence of conspiracy depends upon the existence of, or participation in an agreement, and not the precise timing of its formation. The Applicants have not demonstrated error in her Honour's conclusions in this respect.
Suggested Error in Application of Statutory Modifications to Common Law of Conspiracy Brought About by s.135.4(9) of the Code
The Applicants' second argument is that, whatever may have been the position at common law, s.135.4(9) of the Code involves a statutory modification of the common law so that it is essential for the Crown to prove the entry into an agreement within the period covered by the second count, and that there is no evidence whatsoever of the entry into an agreement in that period so that the second count is foredoomed to fail.
It may be taken that the task of the Court is to interpret the words used by Parliament and not to determine what Parliament intended to say: R v JS at 135 [142].
The judgments of the High Court of Australia in The Queen v LK observed that the principles relating to conspiracy at common law were relevant to questions arising with respect to offences against s.11.5 of the Code - French CJ at 206 [59] and Gummow, Hayne, Crennan, Kiefel and Bell JJ at 220 [97], 224 [107]. Sections 11.5 and 135.4 of the Code are relevantly indistinguishable, so that these observations should be taken to extend to s.135.4 as well.
Similar views were expressed by Spigelman CJ (James and Howie JJ agreeing) in R v B at 541-542 [31]-[34].
The similarities and differences between the offence in s.11.5 of the Code and the common law offence of conspiracy were considered by Howie J (Hislop J agreeing) in R v Ansari [2007] NSWCCA 204; 70 NSWLR 89 at 105-106 [66]:
"Thus the offence of conspiracy under the Code is similar to that at Common Law. Both under the Code and at Common Law two or more persons must mean to enter into an agreement that an offence would be committed by themselves or some other person. The differences between the Code offence and the offence at Common Law are that, firstly, under the Code it is not an offence to enter into an agreement to commit a lawful act by unlawful means and, secondly, it is not an offence under the Code to agree to commit a crime for which the maximum penalty is less than that stated in the section. It should also be noted that under the Code it is not sufficient to support a conviction of a conspiracy offence that there has only been an agreement entered into by the parties: there must also be an overt act committed by at least one person toward the achievement of the object of the agreement."
These observations of Howie J were not criticised in the decision of the High Court of Australia in Ansari v The Queen [2010] HCA 18; 241 CLR 299.
The elements of the offence of conspiracy are found relevantly in s.135.4(5) of the Code: The Queen v LK at 205-206 [57], 212 [75], 213 [78], 216-217 [91]. The requirements contained in s.135.4(9) of the Code inform and explain the meaning of "conspires" , but are not elements of the offence for the purposes of Part 2.2 of the Code: The Queen v LK at 205-206 [57], 228 [117], 232 [132]-[133], 233-234 [137], 234-235 [141].
Although not elements of the offence charged in the second count, it may be taken that it will be necessary for the Crown to prove the matters contained in s.135.4(9) of the Code before each of the Applicants may be found guilty of an offence under that section.
I accept that the only presently relevant alteration to the common law is that effected by s.135.4(9)(c), which requires proof of the commission of an overt act pursuant to the agreement. As Howie J observed in Ansari v R , this was an intended modification of the common law offence to be incorporated in the Code.
I do not accept the submission for the Applicants that s.134.5(9)(a) requires the Crown to adduce evidence that a person must have entered into an agreement with one or more other persons on or after 24 May 2001. I agree with the conclusion of Simpson J that what is required is proof of the existence of, or participation in, an agreement and not a requirement that the agreement was formed on or after 24 May 2001. In my view, this construction serves to promote the purpose or object underlying the Code: s.15AA Acts Interpretation Act 1901 (Cth) .
I agree with Simpson J's conclusion that the physical element for the purpose of s.4.1(1) of the Code is conduct, in the sense of "a state of affairs" : s.4.1(2).
I agree with Simpson J that the position advanced by the Applicants would lead to a highly artificial and absurd result. As her Honour observed at [40], it would be absurd to suggest that an agreement that had its inception prior to the commencement of the relevant provisions of the Code, but that continued, and continued to be implemented thereafter, could not be prosecuted under the Code because the alleged conspirators failed, on the change of legislation to renew, or remake, their agreement. To construe the provisions of the Code in a way that led to this result would not promote the purpose or object underlying the Code.
In my view, no error has been demonstrated by the Applicants in her Honour's construction of s.135.4 of the Code.
Suggested Error in Misconstruing Physical Element of a s.135.4(5) Offence as Being Constituted by "A State of Affairs"
The Applicants submit that her Honour erred in accepting that the physical element in this case could be satisfied by "conduct" in its extended sense of "a state of affairs" . I do not accept this submission.
As French CJ observed in The Queen v LK at 200 [42], the concept of engaging in conduct which is a state of affairs is not explained in the Code. In R v Saengsai-Or [2004] NSWCCA 108; 61 NSWLR 135, Bell J (Wood CJ at CL and Simpson J agreeing) referred, at 144 [58], to the definition of "conduct" in s.4.1(2) of the Code:
"'Conduct' is defined in s 4.1(2) of the Criminal Code to mean 'an act, an omission to perform an act or a state of affairs'. The latter picks up Brennan J's observation in Teh that having something in possession is not easily seen as an act or omission and is more easily seen as a state of affairs: at 564 (see, too, the discussion of 'status offences', such as being in a prohibited place or condition, in Fisse B, Howard's Criminal Law (Sydney: Law Book Co, 5th ed, 1990), at 12). It is noteworthy that Brennan J in Teh observed that the identification of the prohibited act on the one hand and the circumstances attendant on doing the act on the other was an exercise that gave rise to 'intractable difficulties':"
Reference has been made to the term "state of affairs" in the Code in The Queen v Tang [2008] HCA 39; 237 CLR 1 at 24-25 [46]-[47] and Muslimin v The Queen [2010] HCA 7; 240 CLR 470 at 479 [16], but not in ways that assist resolution of the present controversy.
Simpson J concluded (at [39]) that "a state of affairs" includes "the existence (continuing) of an agreement to defraud the Commonwealth" . I accept the Crown submission that an ongoing conspiracy is a state of affairs, and hence conduct, within the meaning of the Code, and that being a party to an ongoing conspiracy is a state of affairs with the same consequence.
What is necessary to establish an offence under s.135.4(5) of the Code is a physical element which may be conduct, or a result of conduct, or a circumstance in which conduct, or a result of conduct, occurs: s.4.1(1). All of these may be encompassed in a state of affairs.
This conclusion is consistent with the ordinary meaning of a "state of affairs" . According to the Oxford English Dictionary, "the (or a) state of things or affairs" means "the way in which events or circumstances stand disposed (at a particular time or within a particular sphere)" .
Further, the term "state of affairs" sits comfortably with the concept of a continuing offence. The statement of Street CJ in Sloggett v Adams , (set out at [59] above) although made in a different context, may be called in aid (at least by analogy), to support the conclusion that a continuing offence (conspiracy) is "committed day by day so long as the state of affairs which is forbidden continues to exist, and the person responsible for creating that state of affairs is liable day by day" for that offence.
It is noteworthy that s.135.4(12) of the Code provides that a person cannot be guilty of an offence under the section if, before the commission of an overt act pursuant to the agreement, the person withdrew from the agreement and took all reasonable steps to prevent the doing of the thing. The concept of a continuing offence, which may be terminated by withdrawal, is recognised within the Code concerning conspiracy.
No error has been demonstrated in Simpson J's conclusion that the physical element of the offence charged in the second count may be established by conduct in the sense of "a state of affairs" .
Suggested Errors Concerning Construction of Transitional Provisions
The submissions of the parties dealt briefly with the question whether her Honour erred in her construction of the transitional provisions (at [42]-[47]). The matter may be dealt with shortly in this judgment.
The principal submission of the Applicants in this respect is that her Honour had side stepped the construction of the transitional provisions by concluding that the physical element in the second count may be constituted by conduct in the form of "a state of affairs" .
Simpson J (at [45]) stressed the omission of "state of affairs" from s.4(2) Law and Justice Legislation Amendment (Application of Criminal Code) Act 2001 (Cth) .
I do not accept the Applicants' submission. For reasons expressed earlier (at [76]-[84] above), her Honour was correct in the conclusion concerning the applicability of the physical element taking the form, in this case, of conduct in the sense of "a state of affairs" .
In my view, her Honour's analysis and application of the transitional provisions is correct.
A Crown Submission that Her Honour had Erred
Simpson J (at [49]-[51]) rejected a Crown submission that relied upon the use of the past tense in s.135.4(9)(a) of the Code in order to argue that an agreement predating the introduction of Chapter 7 was sufficient to establish the necessary agreement. Before this Court, the Crown formally submitted that her Honour had erred in this respect.
I am not persuaded that her Honour erred in the manner contended for by the Crown. Her Honour's reasons are persuasive. I reject the Crown submission on this aspect.
Conclusion
The Applicants have not demonstrated error in any respect in her Honour's reasons for refusing to permanently stay the second count. It has not been demonstrated that the second count is foredoomed to fail so that the prosecution of that count should be permanently stayed.
As the issues raised on these applications are of importance with respect to the construction and operation of s.134.5 of the Code in these and other current prosecutions, I would grant leave to appeal with respect to grounds directed to the refusal to permanently stay the second count upon the basis that it was foredoomed to fail.
A number of submissions advanced by Mr Barker QC appeared to extend beyond that issue to matters concerning what was said to be tension or conflict between the offences charged in the indictment, and the particulars relied upon by the Crown with respect to the alleged offences. I am not satisfied that leave to appeal ought be granted with respect to these issues which travel beyond the foredoomed to fail argument relied upon in support of the permanent stay application.
I propose the following orders:
(a) grant leave to the Applicants under s.5F(3)(a) Criminal Appeal Act 1912 to appeal against the interlocutory judgment or order of Simpson J refusing a permanent stay of the second count on the indictment;
(b) appeals dismissed.
HALL J : I agree with the reasons and orders proposed by Johnson J.
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Decision last updated: 06 August 2013
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