Am v Gill

[2015] NSWSC 586

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:	AM v Gill [2015] NSWSC 586
Hearing dates:	19 June 2014
Date of orders:	19 May 2015
Decision date:	19 May 2015
Jurisdiction:	Common Law
Before:	Hidden J
Decision:	Summons dismissed
Catchwords:	ADMINISTRATIVE LAW – surveillance device warrant – whether false or misleading statements in affidavit supporting application for warrant – whether material facts were omitted – nature and extent of applicant’s duty of disclosure
Legislation Cited:	Crimes Act 1900 Crimes Act 1914 (Cth) Surveillance Devices Act 2007
Cases Cited:	Brian Saunders v Commissioner of the Australian Federal Police (1998) 52 ALD 484 George v Rockett (1990) 170 CLR 104 International Finance Trust Company Ltd v New South Wales Crime Commission [2009] HCA 49, 240 CLR 319 Lego Australia Pty Ltd v Paraggio (1994) 53 FCR 542 Majzoub v Kepreotis [2009] NSWSC 1498 Price v Elder [2000] FCA 133, 60 ALD 375 Thomas A Edison Ltd v Bullock (1912) 15 CLR 679
Category:	Principal judgment
Parties:	AM (plaintiff) Detective Sergeant Andrew Gill (1st defendant) Commissioner of Police of New South Wales (2nd defendant) The Honourable Justice MF Latham (3rd defendant)
Representation:	Counsel: B Vasic with D Randle (plaintiff) M Johnston (1st & 2nd defendants) Solicitors: Fred David, David Legal (plaintiff) Richard Kelly, Acting Crown Solicitor for NSW (1st, 2nd & 3rd defendants)
File Number(s):	2013/288084
Publication restriction:	A non-publication order has been made with respect to the name of the Plaintiff who is to be referred to by the pseudonym AM

Judgment

Suppression order

1. On 1 March 2011, Latham J, as an eligible judge for the purpose of the Surveillance Devices Act 2007, issued a surveillance device warrant authorising the use of listening devices to record conversations to which the plaintiff might be a party. The warrant was issued on the basis of an affidavit by the 1st defendant, Detective Sergeant Andrew Gill, deposing to his reasonable suspicion of the commission and planning of offences of money laundering, that is, knowingly dealing with the proceeds of crime, an offence contrary to s 193B(1) of the Crimes Act 1900. The plaintiff was a target of the investigation.

2. The plaintiff seeks judicial review of the decision to issue the warrant, by way of declarations and/or certiorari. The Commissioner of Police has also been joined as a defendant, as has Latham J. Her Honour has entered a submitting appearance. Sergeant Gill and the Commissioner are the active defendants.

3. The proceedings in this court were commenced by a summons filed on 24 September 2013 (although the plaintiff filed an amended summons on 10 October 2013). In written submissions for the defendants the issue of delay was raised. The plaintiff is awaiting trial in the District Court in relation to the first matter the subject of the warrant, and also raised was the danger of fragmentation of the criminal justice process by undertaking judicial review proceedings of this kind: Majzoub v Kepreotis [2009] NSWSC 1498 at [20] – [21] (Hall J). However, at the hearing neither of these objections was pressed, and it is appropriate that the matter be determined on its merits.

4. Sergeant Gill applied for the warrant under s 17 of the Surveillance Devices Act. Relevantly for present purposes, subs (1) of that section enabled him to apply for a surveillance device warrant on the basis that he suspected “on reasonable grounds” that a money laundering offence had been committed and that another offence of the same nature was likely to be committed. In an affidavit of 23 February 2011, he deposed that there was an investigation into the theft of $1.102 million, and the subsequent laundering of those funds, by a criminal syndicate and a plan by the same syndicate to launder further illicit funds amounting to $10.5 million (US).

5. The sum of $1.102 million was said to have been stolen from the account of a Westpac customer by an unknown woman who had assumed her identity. The offence was assisted by a corrupt bank officer, Bajring Bothra, and the funds were transferred into an account opened by William Richard Tooth. From that account the funds were dispersed into a number of other accounts, from which they were converted into cash.

6. While it is unclear from the affidavit when these events are said to have occurred, the investigation began in August 2010. Mr Bothra was arrested in September 2010, and he made full admissions of his involvement in the enterprise. He was charged with a number of fraud and money laundering offences, and at the time of the affidavit was yet to be dealt with. According to the affidavit, he provided information suggesting that a criminal syndicate was behind the transaction.

7. Sergeant Gill deposed that Mr Tooth was arrested at the end of October 2010 and charged with recklessly dealing in the proceeds of crime. He was said to have provided police with “extensive evidence in relation to the syndicate,” and later became a New South Wales police registered source. He told police about a planned offence by the same syndicate, in which he was to be involved, to launder $10.5 million (US), believed to be the proceeds of crime. A controlled operation was authorised to allow him to continue planning that offence with the syndicate.

8. As to the plaintiff, the affidavit recited that he had introduced Mr Tooth to a person using the name Sam Prasdi. Mr Prasdi was said to be “the point of contact” for Mr Tooth when the offence involving the theft of the $1.102 million was being planned and carried out. Thereafter Mr Tooth never saw that man again. Sergeant Gill deposed to having made enquiries suggesting the name Sam Prasdi was an alias.

9. The affidavit went on to allege that on 1 November 2010 Mr Tooth met with the plaintiff, who told him about “another job.” The plaintiff produced a document purporting to be a will, involving an estate said to have been valued at $10.5 million (US). Mr Tooth understood that he was being asked to launder that amount of money in the same manner in which he had laundered the proceeds of the Westpac theft. Thereafter, the affidavit recited, the plaintiff introduced Mr Tooth to a man named “Maurice”, whom police identified as one Maroun Kabbout. Steps taken by Mr Tooth and Mr Kabbout up to February 2011 for the purpose of facilitating the laundering of the money were then described. From 15 February 2011 telephone intercepts were in place. In one of the intercepted conversations, between Mr Kabbout and Mr Tooth, reference was made to a planned meeting with the plaintiff.

10. In the affidavit Sergeant Gill requested a warrant for the use of listening devices to be worn by Mr Tooth for the purpose of recording conversations between the three men. Latham J granted that warrant. To do so, her Honour needed to be satisfied that there were reasonable grounds for the suspicion founding the application of the warrant: s 19(1)(a) of the Act, and to have had regard to certain matters set out in s 19(2), which are not in issue here. The warrant stated, pursuant to s 20(1)(a), that her Honour was satisfied of the matters set out in s 19(1) and had had regard to the matters in s 19(2). She also specified a number of matters required by s 20(1)(b), which also are not in issue.

11. In this court it was not suggested that the warrant was not valid on its face, or that it did not contain information sufficient for her Honour to be satisfied that there were reasonable grounds for the application seeking it. Rather, the validity of the warrant was challenged on the basis that Sergeant Gill’s affidavit contained false or misleading statements and omitted material facts which, considered individually or collectively, tended to mislead her Honour and, accordingly, may have affected the exercise of her discretion to issue the warrant. Further, it was said that Sergeant Gill failed properly to disclose the nature and source of some of the assertions of fact made in the affidavit, and whether some of the statements were assertions of fact, suspicion, belief, or conclusions drawn by inference from other asserted facts.

12. Reference was made to the statements of the High Court in George v Rockett (1990) 170 CLR 104, a case dealing with a search warrant, that when a statute prescribes that there must be “reasonable grounds” for a state of mind, it requires the existence of facts sufficient to induce that state of mind in a reasonable person (at 112), and that an information relied upon for the issue of a warrant must state the reasonable ground for the relevant suspicion (at 113).

13. On 31 October 2010, Mr Tooth participated in a lengthy recorded interview conducted by Sergeant Gill, with another officer in attendance. Put shortly, the effect of what he told police was that the deposit of the $1.102 million into his account related to a loan he had negotiated with a man he knew as Sam Prasdi, to whom he had been introduced by the plaintiff. He maintained contact with Mr Prasdi largely through the plaintiff, and gained the impression that he was acting on the plaintiff’s behalf.

14. His account of his dealings with Mr Prasdi was long and rather involved, and need not be recounted. It was of dubious credibility. It is sufficient to say that, according to him, his contact with Mr Prasdi began in 2008 when the two were introduced by the plaintiff. His early dealings with Mr Prasdi concerning the loan led to dishonest transactions involving valueless cheques. Ultimately, when the $1.1 million was deposited into his account, Mr Prasdi directed him to take $550,000 towards the loan and gave him directions as to the disposition of the remaining funds. While he was suspicious of these dealings, he said, he denied any knowledge that the money deposited was stolen and denied being knowingly involved in a money laundering exercise. He also said that on a number of occasions when he contacted the plaintiff because he was having difficulties in his dealings with Mr Prasdi, the plaintiff said that the matter had nothing to do with him.

15. It was the day after that interview, 1 November 2010, that he met the plaintiff and there was discussion about the $10.5 million (US). In a statement to police of 16 February 2011, he said that after the interview he knew that the money which had been deposited into his account was stolen, and he suspected that at the 1 November meeting the plaintiff was going to ask him to launder more money for him. He then gave an account of his conversation with the plaintiff on that day, of his being put in touch with Mr Kabbout, and of his dealings with Mr Kabbout thereafter, which is broadly consistent with the description of these events in Sergeant Gill’s affidavit.

16. Mr Vasic, who appeared with Mr Randle for the plaintiff, noted that Sergeant Gill’s affidavit made no reference to Mr Tooth’s explanation in the recorded interview for the transfer of the $1.1 million into his account and his denial of knowing involvement in a money laundering scheme. He challenged Sergeant Gill’s assertion that the alleged offence involving that money was perpetrated by a “criminal syndicate”, and that the offence alleged in respect of the $10.5 million (US) was the work of the same syndicate. He noted that the people referred to as being involved in the first offence were Mr Tooth, the man known as Prasdi, the bank officer, Mr Bothra, the unknown woman who had assumed the identity of the Westpac customer and, by inference, the plaintiff. At the time the second offence is said to have been mooted, Mr Bothra had been arrested in respect of the first offence and a new participant, Mr Kabbout, was alleged to have been involved. Mr Vasic also challenged Sergeant Gill’s statement that Mr Tooth provided “extensive evidence” in relation to the syndicate.

17. In response, counsel for the defendants, Mr Johnston, described the word “syndicate” as “a collective noun which, in the context of the subject police investigation, would appropriately describe participants, both known and unknown, engaged in the suspect offences.” He also noted that Mr Bothra was said to have “provided information that suggested the existence of a criminal syndicate behind the transaction.” Nor was it inappropriate to assert that the same syndicate was involved in the proposed second offence, given that the plaintiff and Mr Tooth were alleged to be involved in it. Insofar as it was inaccurate, the inaccuracy was immaterial. As to the assertion that Mr Tooth had provided extensive evidence in relation to the syndicate, it was apparent from his recorded interview and his statement that he had furnished a considerable amount of information in furtherance of the investigation. That he denied knowing involvement in the laundering of the stolen money was not to the point.

18. Mr Vasic pointed to certain inconsistencies between Mr Tooth’s account in the recorded interview and in the statement of 16 February 2011. He argued that Mr Tooth’s innocent explanation in the recorded interview of the circumstances, as he understood them, of the deposit of the stolen money into his account, and his assertion that the plaintiff repeatedly said that the matter had nothing to do with him, stood in contrast to his assertion in the statement that when he went to the meeting with the plaintiff on 1 November 2010 he expected to be asked to launder “some more money for him.” Mr Vasic also pointed out that Sergeant Gill’s affidavit did not disclose the full extent and nature of Mr Tooth’s criminal history, in particular some fraud offences committed in 1998 and 1999. Nor was there disclosed Mr Tooth’s account in the recorded interview of his earlier dealings with Mr Prasdi and the dishonest transactions which they involved. This material was said to bear upon Mr Tooth’s credibility and the reasonableness of the suspicion against the plaintiff said to arise from his information.

19. To these matters, Mr Johnston responded by noting that Sergeant Gill referred in the affidavit to Mr Tooth having been “charged with numerous offences relating to frauds in the years 1999 and 2000”, and to his having been sentenced in 2000 to 6 years imprisonment. Mr Johnston acknowledged that this did not accurately represent Mr Tooth’s criminal history, and that the term of imprisonment imposed in 2000 was more than 6 years. Here again, he argued that these inaccuracies were immaterial. He also argued that, in the light of Mr Tooth’s information about the transactions the subject of the warrant, his earlier fraudulent dealings were not material. Finally, he argued that it was not incumbent upon Sergeant Gill to record and analyse suggested inconsistencies in the versions of events given by Mr Tooth in the recorded interview and the statement.

20. On this aspect of the matter, Mr Johnston referred to some comments of the Full Federal Court in Price v Elder [2000] FCA 133, 60 ALD 375. Although related to the issue of a search warrant, and in a different context, these comments at [8] (377) are apt:

“An applicant for a search warrant who discloses material in the information giving reasonable grounds for suspecting the presence of evidential material on the subject premises is not obliged to traverse those facts by reference to exculpatory explanations raised by the object of the suspicion.  An exculpatory explanation does not necessarily dispel the grounds for suspicion that justify the issue of a warrant.  The issuing officer is not required to conduct an enquiry to determine where the truth may lie.  It is the object of the search warrant to assist law enforcement authorities to that outcome: Brian Saunders v Commissioner of the Australian Federal Police (1998) 52 ALD 484 at 496.”

Undoubtedly, questions arose as to Mr Tooth’s credibility but it was not for Latham J to resolve them. Mr Johnston also submitted that Sergeant Gill was not obliged in the application for the warrant to disclose all the information in his possession, relying on authority to which I shall refer shortly.

21. Mr Vasic criticised a number of other aspects of Sergeant Gill’s affidavit, suggesting that they were misleading or created a false impression of the evidence available to him. I do not propose to examine these individually. They relate to the dispersal of the money paid into Mr Tooth’s account, to the characterisation of the man Prasdi as the plaintiff’s “point of contact” for Mr Tooth, to the manner in which Mr Tooth came into contact with Mr Kabbout and to aspects of their dealings thereafter, and to the significance of some of the intercepted phone calls between those two men and between Mr Tooth and the plaintiff. Each of these matters was addressed, in my view effectively, in the submissions of Mr Johnston. It is sufficient to say that they raise possible interpretations of the material consistent with the plaintiff’s innocence but, as Mr Johnston put it in written submissions, they are “matters for trial and not for review of the decision to issue the warrant.”

22. In Lego Australia Pty Ltd v Paraggio (1994) 52 FCR 542, a case involving search warrants issued under the Crimes Act 1914 (Cth), Beaumont and Whitlam JJ applied administrative law principles to the review of the issue of the warrants. Their Honours noted (at 555) that in exceptional cases an administrative decision may be vitiated by fraud or misrepresentation (including a statement which was a half-truth and thus misleading). Their Honours also concluded (again at 555) that the informant seeking the issue of a warrant is not under a duty of disclosure, breach of which would invalidate it. They contrasted the position with that of a party to private civil litigation seeking ex parte relief.

23. Earlier in the judgment reference had been made, among other authorities, to Thomas A Edison Ltd v Bullock (1912) 15 CLR 679 at 682, where Isaacs J had referred to the obligation of such a party to occupy the place of the absent party “to the extent of bringing forward all the material facts which that party would presumably have brought forward in his defence to that application.” Their Honours said (at 555):

“… generally speaking, the role of the court in judicial review is to supervise the activities of the Executive so as to ensure that administrative action takes place in accordance with the rule of law. This supervisory jurisdiction is very different in character from the function of the courts in determining civil disputes between private citizens. In other words,it may be one thing to apply the principles discussed in Edison v Bullock in ordinary civil litigation. It is another to seek to apply them in an application for judicial review of a decision to grant a warrant where the statutory authority to grant the warrant contemplates that the application for it will, necessarily, be made ex parte, yet where the statute also requires, in order to protect the legitimate interests of members of the community, that certain conditions be fulfilled before the warrant may be granted.”

24. In Majzoub v Kepreotis (supra), yet another case dealing with a search warrant, Hall J summarised the position at [68]-[69]:

“68   While an applicant for a warrant is not under a general duty of disclosure at common law, in an exceptional case, a warrant may be vitiated by fraud or misrepresentation: Lego Australia Pty Ltd v Paraggio (1994) 52 FCR 542 at 555. A statement that is a half-truth, and therefore misleading, may be treated as a misrepresentation: Lego at 555, 564 and 570; Puglisi v Australian Fisheries Management Authority (1997) 148 ALR 393 at 400. The word “misrepresentation” has been held to mean “fraudulent misrepresentation” and “fraud” to mean “dishonesty of a more general kind, so that only conduct of that kind will vitiate a decision and allow the power to be exercised afresh" (Firearm Distributors Pty Ltd v Carson [2001] 2 Qd R 26 at [44]).

69   Beaumont and Whitlam JJ observed in Lego (supra) at 555 that in the absence of an abstract duty of disclosure, the question ultimately is whether the information in the application for warrant is sufficient to satisfy the statutory requirements, in that case, s 10 of the Crimes Act 1914 (Cth).”

25. These principles apply to the issue of a warrant under the Surveillance Devices Act 2007. The issue of such a warrant by an eligible judge is an administrative act. Mr Vasic submitted that the view of Beaumont and Whitlam JJ in Lego Australia can no longer be sustained in the light of the decision of the High Court in International Finance Trust Company Ltd v New South Wales Crime Commission [2009] HCA 49, 240 CLR 319.

26. It is not necessary to examine that important case in any detail for present purposes. It was concerned with the approach of this court to ex parte applications for restraining orders under the Criminal Assets Recovery Act 1990 (NSW). Reliance was placed upon statements by members of the court about the duty of disclosure in applications of that kind. However, under the Criminal Assets Recovery Act those applications are curial proceedings in which a judge acts judicially, not administratively. It is in that context that the observations relied upon must be understood. Moreover, as Mr Johnston pointed out, the statement of principle by Beaumont and Whitlam JJ in Lego Australia has been followed in subsequent decisions, including Saunders v Commissioner of Australian Federal Police, Price v Elder and Majzoub v Kepreotis (supra).

27. In the present case, I am not persuaded that any inaccuracy or omission in Sergeant Gill’s affidavit was material to Latham J’s decision to issue the warrant. Nor am I persuaded that there was any material misstatement or misinterpretation on his part of the evidence available to him. However, those findings are not necessary to dispose of the matter. It is sufficient to say that there is no basis for finding dishonesty or fraudulent misrepresentation on the part of Sergeant Gill. Neither in written or oral submissions was such a case put on the plaintiff’s behalf. An affidavit of Sergeant Gill for the purpose of these proceedings was read, but Mr Vasic did not seek to cross-examine him.

28. Mr Johnston pointed out that the affidavit in support of the application for the warrant was based not only on the information supplied by Mr Tooth, but also that supplied by Mr Bothra, as well as police investigation of the movement of the stolen Westpac funds through bank records, and the telephone intercepts. As he put it in written submissions, the affidavit provided “a succinct overview of the relevant matters giving rise to reasonable grounds for a suspicion or belief founding the application of the warrant.” It was neither necessary nor practicable to refer to every piece of information available.

29. No basis has been established for setting the warrant aside. Accordingly, the amended summons is dismissed. If necessary, I shall hear the parties on costs.

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Amendments

24 February 2016 - Publishing restriction removed – judgment published

Decision last updated: 24 February 2016