BC Galleries (Vic) Pty Ltd v Commonwealth of Australia

[2012] FMCA 742

FEDERAL MAGISTRATES COURT OF AUSTRALIA

BC GALLERIES (VIC) PTY LTD v COMMONWEALTH OF AUSTRALIA [2012] FMCA 742

ADMINISTRATIVE LAW – Protection of Movable Cultural Heritage Act 1986 – forfeiture.

Cultural Properties Preservation and Protection Act (Philippines)
Customs Act 1901, ss.203, 229(j)
Evidence Act1995, ss.144, 174
Judiciary Act1903, s.39B
Law of the People's Republic of China on Protection of Cultural Relics (Order of the President No.76) (China)
Protection of Movable Cultural Heritage Act 1986, ss.3, 7, 8, 14(1), 34, 36, 37, 38
Protection of Movable Cultural Heritage Regulations 1987, Part 5

Commissioner of Australian Federal Police v Craven (1989) 20 FCR 547; 98 ALR 249
Blake v Brain and Minister of Communications and the Arts [1995] AATA 201
Truswell v Minister of Communications and the Arts [1996] AATA 154

Applicant: BC GALLERIES (VIC) PTY LTD

Respondent: COMMONWEALTH OF AUSTRALIA

File Number: MLG 1481 of 2010

Judgment of: Riethmuller FM

Hearing date: 1 June 2012

Date of Last Submission: 1 June 2012

Delivered at: Melbourne

Delivered on: 23 August 2012

REPRESENTATION

Counsel for the Applicant: Mr Gronow of Counsel

Solicitors for the Applicant: Logie-Smith Lanyon Lawyers

Counsel for the Respondent: Mr Dillon

Solicitors for the Respondent: Australian Government Solicitor

ORDERS

1. It is declared that the objects seized by the Respondent from the Applicant on 10 June 2010 are not forfeited or liable to be forfeited under the Protection of Movable Cultural Heritage Act 1986.

2. The Respondent deliver up to the Applicant the objects described in paragraphs 3 to 9 of the Statement of Claim within 28 days of this Order (or in the event a Notice of Appeal is lodged, within 28 days of the determination of the appeal).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT MELBOURNE

MLG 1481 of 2010

BC GALLERIES (VIC) PTY LTD

Applicant

And

COMMONWEALTH OF AUSTRALIA

Respondent

REASONS FOR JUDGMENT

1. The applicant applies for the return of a number objects d'art seized by officers of the Commonwealth pursuant to section 34 of the Protection of Moveable Cultural Heritage Act 1986. Section 34 of the Act provides:

   34     [Seizure of protected objects]

   An inspector may seize a protected object that the inspector believes on reasonable grounds to be forfeited

2. The Federal Magistrates Court has jurisdiction with respect to this case as it was remitted from the Federal Court.

3. Following the seizure of the objects notices were given under section 36 and court proceedings issued thereafter pursuant to section 37(1) of the Act. The relevant provision for the purposes of these proceedings is section 37(3) which provides:

   (3)  Where an action is brought for recovery of a protected object, the court shall determine, on a balance of probabilities, whether:

   (a)  the object is forfeited by virtue of subsection 9(1); or

   (b)  the object is liable to forfeiture by virtue of subsection 9(2) or 14(1);

   and the court:

   (c)  where paragraph (a) applies--shall reject the claim for recovery;

   (d)  where paragraph (b) applies--shall order that the object is forfeited; or

   (e)  in any other case--may order the return of the object.

4. The Commonwealth maintains that the objects should be subject to a forfeiture order under section 37(3)(d) and the applicant seeks their return.

5. The test is set out in section 14(1) as:

   (1)  Where:

   (a)  a protected object of a foreign country has been exported from that country;

   (b)  the export was prohibited by a law of that country relating to cultural property; and

   (c)  the object is imported;

   the object is liable to forfeiture.

6. In order for the Commonwealth to succeed it must therefore show that:

   a)each object is a "protected object of a foreign country";

   b)that the object has been exported from the relevant foreign country;

   c)the law of the relevant foreign country "relating to cultural property" prohibited the export; and

   d)that the object has been imported into Australia.

7. The term "protected object of a foreign country" has a definition in section 3 as "an object forming part of the moveable cultural heritage of a foreign country". A more extensive definition relating to cultural heritage, with respect to Australia, is given in section 7, however this definition appears to be limited to the use of the phrase "moveable cultural heritage of Australia" in section 8 which provides for regulations to establish a control list. However, the extended definition in section 7 is useful to review as it forms part of the statutory scheme and provides some real background to the concepts involved. Section 7 provides:

   (1)  A reference in section 8 to the movable cultural heritage of Australia is a reference to objects that are of importance to Australia, or to a particular part of Australia, for ethnological, archaeological, historical, literary, artistic, scientific or technological reasons, being objects falling within one or more of the following categories:

   (a)  objects recovered from:

   (i)  the soil or inland waters of Australia;

   (ii)  the coastal sea of Australia or the waters above the continental shelf of Australia; or

   (iii)  the seabed or subsoil beneath the sea or waters referred to in subparagraph (ii);

   (b)  objects relating to members of the Aboriginal race of Australia and descendants of the indigenous inhabitants of the Torres Strait Islands;

   (c)  objects of ethnographic art or ethnography;

   (d)  military objects;

   (e)  objects of decorative art;

   (f)  objects of fine art;

   (g)  objects of scientific or technological interest;

   (h)  books, records, documents or photographs, graphic, film or television material or sound recordings;

   (j)  any other prescribed categories.

   (2)  The generality of paragraph (1)(j) is not limited by any of the other paragraphs of subsection (1).

8. As is immediately apparent from reading the section, its application could well be vast with regard to the enormous array of objects covered by section 7(1)(a) to (j). The almost open ended nature of the list is confined by the phrase "objects that are of importance to Australia" and the requirement that it be part of the "moveable cultural heritage of Australia." One of the definitions of “heritage” in the Australian Macquarie Dictionary is “the culture, traditions and national assets preserved from one generation to another”.

9. The Protection of Movable Cultural Heritage Act 1986 appears to give effect to the 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property.  Article 1 of the Convention provides:

   For the purposes of this Convention, the term `cultural property' means property which, on religious or secular grounds, is specifically designated by each State as being of importance for archaeology, prehistory, history, literature, art or science and which belongs to the following categories:

   (a) Rare collections and specimens of fauna, flora, minerals and anatomy, and objects of palaeontological interest;

   (b) property relating to history, including the history of science and technology and military and social history, to the life of national leaders, thinkers, scientists and artist and to events of national importance;

   (c) products of archaeological excavations (including regular and clandestine) or of archaeological discoveries ;

   (d) elements of artistic or historical monuments or archaeological sites which have been dismembered;

   (e) antiquities more than one hundred years old, such as inscriptions, coins and engraved seals;

   (f) objects of ethnological interest;

   (g) property of artistic interest, such as:

   (i) pictures, paintings and drawings produced entirely by hand on any support and in any material (excluding industrial designs and manufactured articles decorated by hand);

   (ii) original works of statuary art and sculpture in any material;

   (iii) original engravings, prints and lithographs ;

   (iv) original artistic assemblages and montages in any material;

   (h) rare manuscripts and incunabula, old books, documents and publications of special interest (historical, artistic, scientific, literary, etc.) singly or in collections ;

   (i) postage, revenue and similar stamps, singly or in collections;

   (j) archives, including sound, photographic and cinematographic archives;

   (k) articles of furniture more than one hundred years old and old musical instruments.

10. The explanatory memorandum for the Protection of Movable Cultural Heritage Amendment Bill 1999 provides (at page 3 and 4):

    New section 25B identifies the purpose of the National Cultural Heritage Account, as required by subsection 21(1) of the FMA Act. The purpose will be to facilitate the acquisition of Australian protected objects for display or safe keeping. This was the same purpose previously given to the National Cultural Heritage Fund. In practice, it is intended that money given to the Fund will be used to assist cultural organisations in acquiring Australian Class A or Class B objects. These are objects that are subject to the National Cultural Heritage Control List established under section 8 of the PMCH Act, which lists categories of objects that constitute the movable cultural heritage of Australia and that are to be subject to export control. These are objects which are of importance to Australia, or to a particular part of Australia, for ethnological, archaeological, historical, literary, artistic, scientific or technological reasons.  (emphasis added)

11. In the Second Reading speech for the Protection of Movable Cultural Heritage Bill 1986 Senator Robertson stated:

    All nations possess objects which illustrate in unique or significant ways their history and culture. In Australia's case, some of these objects date back beyond recorded history to the deep roots of Aboriginal life…(emphasis added)

12. In Frederick William Blake and Terry Brain and Minister of Communications and the Arts [1995] AATA 201 the Member said:

    58.    The legislation is not intended to stop movement of all cultural material or even most of it but is concerned only to see that those objects the export of which would constitute an irreparable loss to our cultural heritage remain in Australia.

13. In Truswell v Minister of Communications and the Arts [1996] AATA 154 the issue of cultural heritage was discussed at length:

    What is the "cultural heritage of Australia"?

    108. Before we can take these steps, there are two preliminary issues which must be considered. The first relates to the meaning of the words "cultural heritage of Australia". We are required to consider the effect of the loss of the VC upon Australia's cultural heritage (not its movable cultural heritage) and to determine whether its loss would significantly diminish that cultural heritage. We cannot do that until we have considered what is meant by the "cultural heritage of Australia".

    109. While the term "cultural heritage" must be considered in the context of the Act, it is useful to consider the meanings which may be ascribed to these words. They have not been considered in previous cases, although matters of heritage and culture have been the subject of various enactments at Commonwealth and State level. Only two, the Australian Heritage Commission Act 1975 ("the Australian Heritage Commission Act") and the World Heritage Properties Conservation Act 1983 ("the World Heritage Properties Conservation Act) provide assistance in this case. We will commence, however, with a consideration of the dictionary meaning of the words "cultural" and "heritage".

    110. The New Shorter Oxford English Dictionary (4th edition, 1993) defines "cultural", in so far as it is relevant, as:

    "... 2. Of or pertaining to culture in a society or civilisation. L19. ..."

    The word "culture" is defined, again in so far as it is relevant as:

    "... II4 The cultivation or development of the mind, manners, etc.: improvement by education and training. Ex16. 5 Refinement of mind, tastes, and manners, artistic and intellectual development; the artistic and intellectual side of civilization. E19. 6 A particular form, stage, or type of intellectual development or civilization in a society; a society or group characterized by its distinctive customs, achievements, products, outlook etc. M19. 7 The distinctive customs, achievements, products, outlook, etc. of a society or group; the way of life of a society or group. L19. ..."

    111. The definition of the word "heritage" reads, in part:

    "2. The fact of inheriting, hereditary succession. ME-m16. 3. A gift which constitutes a proper possession, spec God's chosen people; the ancient Israelites; the Church. ME. 4 Inherited circumstances or benefits. E17, 1 SIR W. SCOTT Lord of a barren heritage. N. EZEKIEL God's love remains your heritage. 3 AV 1 Pec. I 5:3 Neither as being lords over God's heritage. 4 LYNDON B. JOHNSON My Texas background or my Southern heritage. J. BRODSKY she was carrying the heritage of her predecessors into the art of this century.

    Attrib. and comb.: In the senses 'forming part of a national or cultural heritage', as heritage highway, train, etc.; 'concerned with the conservation and use of the national or cultural heritage', as heritage group, industry, etc. special combs, as heritage coast a section of the UK coastline designated as aesthetically or culturally important and therefore protected from development, heritage trail a route linking places of historic interest."

    112. It follows from these dictionary definitions that the ordinary meaning of the words "cultural heritage" is a very wide one. Cultural heritage is that which is inherited by a society or group about its customs, achievements, products and outlook, its artistic and intellectual development and its forms, stages and types of intellectual development or civilization. It follows that cultural heritage includes not only tangible property such as objects or land but also the intangible such as customs, outlook, religion, folk-lore, music or history.

    Australian Heritage Commission Act

    113. Turning now to the first of the Commonwealth Acts we have mentioned, the Australian Heritage Commission Act establishes the Australian Heritage Commission with various functions relating to the "national estate". The "national estate":

    "... consists of those places, being components of the natural environment of Australia or the cultural environment of Australia, that have aesthetic, historic, scientific or social significance or other special value for future generations as well as for the present community." (Sub-section 4(1))

    114. In broad terms, a "place" includes a site, area or region, a building or other structure or a group of buildings or other structures (sub-section 3(1)). Without limiting the generality of sub-section 4(1), sub-section 4(1A) goes on to list particular features or qualities of a place which would lead to its being included in the national estate. Those features are:

    "(a) its importance in the course, or pattern, of Australia's natural or cultural history;

    (b) its possession of uncommon, rare or endangered aspects of Australia's natural or cultural history;

    (c) its potential to yield information that will contribute to an understanding of Australia's natural or cultural history;

    (d) its importance in demonstrating the principal characteristics of:

    (i) a class of Australia's natural or cultural places; or

    (ii) a class of Australia's natural or cultural environments;

    (e) its importance in exhibiting particular aesthetic characteristics valued by a community or cultural group;

    (f) its importance in demonstrating a high degree of creative or technical achievement at a particular period;

    (g) its strong or special association with a particular community or cultural group for social, cultural or spiritual reasons;

    (h) its special association with the life or works of a person, or group of persons, of importance in Australia's natural or cultural history."

    115. The grounds upon which a place may be included in the national estate under the Australian Heritage Commission Act reflect the legislation's intention to preserve Australia's natural and cultural environment. It is concerned not with the universal issues of world heritage but with the more particular aspects of what comprises the natural and cultural environment of Australia. In doing so, it is clear that the Australian Heritage Commission Act has adopted a meaning of "culture" which encompasses the ordinary meaning of the word.

    116. The World Heritage Properties Conservation Act applies to "identified property". Sub-section 3A(1) provides that "identified property" is property which satisfies one or more of the conditions specified in the sub-section. One of those conditions is that:

    "the property forms part of the cultural heritage or natural heritage and is declared by the regulations to form part of the cultural heritage or natural heritage;" (Sub-paragraph 3A(1)(a)(iv)).

    117. Sub-section 3(1) provides that "cultural heritage" has the same meaning as in the Convention for the Protection of the World Cultural and Natural Heritage adopted by the General Conference of the United Nations Educational, Scientific and Cultural Organisation ("the World Heritage Convention"). That Convention defines "cultural heritage" as:

    "monuments: architectural works, works of monumental sculpture and painting, elements or structures of an archaeological nature, inscriptions, cave dwellings and combinations of features, which are of outstanding universal value from the point of view of history, art or science; groups of buildings: groups of separate or connected buildings which, because of their architecture, their homogeneity or their place in the landscape, are of outstanding universal value from the point of view of history, art or science; sites: works of man or the combined works of nature and of man, and areas including archaeological sites which are of outstanding universal value from the historical, aesthetic, ethnological or anthropological points of view." (Convention, Schedule to the World Heritage Properties Conservation Act.)

    118. The World Heritage Properties Conservation Act has adopted a meaning of "cultural heritage" which is narrower than the ordinary meaning of those words, being one which reflects the Act's aim of protecting and preserving property which is of outstanding universal value. The meaning adopted is focussed upon the value of the property to all persons. It adopts as its criteria in determining whether property is of outstanding universal value historical, artistic or scientific reasons and historical, aesthetic, ethnological or anthropological reasons. It does not focus upon other aspects of cultural heritage, such as customs, religion and folklore.

    119. Is the ordinary meaning to be given to the words "cultural heritage" as they appear in sub-section 10(6) of the Act, or is it to be given some other meaning? As we have observed, Australia's movable cultural heritage is to be determined by reference to what is important to Australia or a part of Australia for ethnological, archaeological, historical, literary, artistic, scientific or technological reasons and by reference to whether they fall within particular categories. This description necessarily focuses upon the tangible and movable for it is dealing with objects of cultural heritage that are capable of export.

    120. That the description of movable cultural heritage focuses upon some aspects only of cultural heritage does not mean that a commensurately narrow meaning should be given to the words "cultural heritage" in sub-section 10(6). Sub-section 10(6) requires consideration of the effect of the loss of a particular object upon the cultural heritage of Australia. There are no words of limitation such as those in sub-section 7(1), and this accords with the essence of the scheme established by the Act, namely that the loss of the particular object is to be assessed against the whole of Australia's cultural heritage. For these reasons, we consider that the words "cultural heritage" should be given their ordinary meaning in sub-section 10(6).(emphasis added)

Onus of proof

1. At the commencement of the trial it was necessary to determine which party bore the onus of proof in order to give rulings as to the order in which the parties should present their cases.  It is convenient to incorporate the reasons given at that stage here. 

2. Following the seizure, s.36 provides a mechanism whereby a notice is to be given to the owner or the person from whom the object was seized and if no steps are taken within 30 days then the object is then forfeited under that section. If steps are taken, as has occurred in this case, by the owner who is also the person that received the notice, then the matter is able to come before the court on an action by the owner for the recovery of the object pursuant to section 37(1).

3. Under section 37(2), if the person discontinues the action at that point the object is also forfeited.

4. If the action is not discontinued, forfeiture will only occur pursuant to section 37(3) if the Court has determined on the balance of probabilities that the object is liable to forfeiture by virtue of section 14(1), and thereupon makes an order for forfeiture under section 37(3)(d). Importantly, section 37(3)(e) provides that in any other case, the court may order the return of the object:

   (3)  Where an action is brought for recovery of a protected object, the court shall determine, on a balance of probabilities, whether:

   (a)  the object is forfeited by virtue of subsection 9(1); or

   (b)  the object is liable to forfeiture by virtue of subsection 9(2) or 14(1);

   and the court:

   (c)  where paragraph (a) applies--shall reject the claim for recovery;

   (d)  where paragraph (b) applies--shall order that the object is forfeited; or

   (e)  in any other case--may order the return of the object.

5. In this context it seems that the use of the word “may” in the Act was to recognise the possibility that there may be other proper reasons at law for the object not to be returned to the person from whom it was seize.  For example, if the object were seized from a carrier and the action is brought by the owner.  Another example could be that where, during the course of the action, there are other reasons to demonstrate that the object was a prohibited import under other legislative schemes or was not in fact the property of the person who brought the action.  That matters little in the context of the current proceedings.

6. The effect of forfeiture is set out in section 38, which is to vest all title and interest in the object in the Commonwealth of Australia. In the context of this case, there is no question that the applicant is the person from whom the objects were seized. Should the Commonwealth fail to establish that the object is liable to forfeiture under section 14(1), the court would order the return of the objects to the applicant.

7. If the applicant were to call no evidence and the respondent was unable to establish the factors required under section 14(1), then section 37(3)(b) would not apply and therefore a forfeiture order would not be available under sections 37(3)(d), and 37(3)(e) would be engaged. During argument counsel referred to the decision of the Full Court of the Federal Court in Commissioner of Australian Federal Police v Craven (1989) 20 FCR 547; 98 ALR 249, which dealt with an application concerning a motor vehicle seized by customs on the grounds it was involved in the illegal importation of prohibited substances.

8. In Craven’s case the applicant, seeking the return of the vehicle, bore the onus of proof. Notably, the applicant was applying under s.39B of the Judiciary Act1903 and seeking orders relating to the lawfulness of the conduct of the customs officer, in the judicial review proceedings and therefore bore the legal onus.  Even under the Customs Act 1901 however, it is clear that, as it was framed at that time, the customs officers were able to seize any forfeited goods under section 203 of the Act and that goods were forfeited at the moment that they were used inappropriately, as is apparent from s.229(j) of the Customs Act:

   229 [Forfeited goods]

   The following goods shall be forfeited to the Crown:-

   …

   (j)  Any carriage or animal used in smuggling or in the unlawful importation, exportation, or conveyance of any goods.  (emphasis added)

9. Thus, under the customs scheme, goods are forfeited to the Commonwealth at the point that they are used as described in section 229 and the onus would be upon the applicant to establish to the court that the facts and circumstances demonstrate that the goods should be returned to them.

10. When one reads section 37 as a whole, in particular, section 37(3), the onus of proof in order to obtain a forfeiture order lies upon the respondent, the Commonwealth. In this case, it seems clear that there is no onus on the applicant. Not all cases that arise under section 37 would necessarily be in a similar position, in that some applicants may not necessarily be the admitted owner and person from whom the goods were taken and thus able to effectively succeed without any further evidence. In these circumstances, where the respondent bears the relevant onus of proof, it is an appropriate and convenient way to run the trial to have the Commonwealth proceed first and call their evidence followed by the applicant.

11. For these reasons I therefore directed that the trial proceed by way of the respondent’s case first followed by the applicant.  I note that in this regard, at least on the views of some authors (such as Cairns’ Australian Civil Procedure, 2009), this is described as undesirable for an applicant in that they lose the right to begin.  However, it is not for me to make those tactical or strategic decisions but rather to determine the question based upon the appropriate way to run the trial and that turns upon determining which party has the onus of proof.  In this case that is the respondent and the respondent ought therefore to proceed first.

The relevant objects involved in this case

1. This case involves 7 objects:

   a)“Han Buried Stele” or “Pottery Stele”, this is described by Dr Galloway as a hollow tomb brick made by joining slabs of clay (see page 7 of Dr Galloway’s report, annexure A of her affidavit affirmed 12 September 2011).  The applicant purchased the “Han Buried Stele” in February 2007 for $HK500 (see paragraph [25] of Mr Bottaro’s affidavit sworn 11 August 2011).

   b)The object titled on the applicant’s online gallery, “A Superb Northern Qi bull”, is a painted pottery bull that was purchased in February 2009 for $HK780, which was approximately $AUD160 based on the exchange rate at the time and was offered for sale by the applicant at $AUD12,500 (see paragraph [29] of Mr Bottaro’s affidavit; page 3 and appendix 2, attachment J of Mr Chappel’s affidavit affirmed on 26 September 2011.).

   c)“An Important Ceramic Statue of a Horse, Northern Dynasties period”, is a large red pottery statute of a horse, with a detachable red pottery saddle.  The object was purchased by the applicant in July 2009 for $HK3,000, which was approximately $AUD500 at the exchange rate at the time and was offered for sale by the applicant at $AUD19,750 (see paragraph [31] of Mr Bottaro’s affidavit; page 3 and appendix 2, attachment K of Mr Chappel’s affidavit).

   d)“Eastern Han dynasty bronze and pottery money tree”.  The pottery base is decorated with toad and tortoise figures and the tree is “comprised of a central bronze ‘trunk’ which fits into the pottery base and into which the bronze ‘branch’ components are designed to slot”.  The piece is also associated with 7 gold coloured boxes.  The piece was purchased by the applicant in October 2009 for $HK3,000, being approximately $AUD440 at the time and was offered for sale by the applicant at A$17,500 (see paragraph [35] of Mr Bottaro’s affidavit; appendix 2, attachment L of Mr Chappel’s affidavit). 

   e)In the applicant’s online gallery, the items titled “A Rare Tang dynasty stone pillar with Buddhist scenes” are described in the statement of claim and Mr Bottaro’s affidavit as “Chinese Stone Columns” (see paragraph 8 of the statement of claim and paragraphs [38]-[41] of Bottaro’s affidavit).  The applicant purchased the objects in March 2010 for $HK2,200, being approximately $AUD310 at the exchange rate of the time and offered them for sale at A$12,500 (see paragraph [39] of Mr Bottaro’s affidavit; page 4 and appendix 2, attachments M and N of Mr Chappel’s affidavit.)

   f)The item titled “Han dynasty ceramic wall panel” on the applicant’s online gallery (or described by Dr Galloway as “Painted tomb panel”) is described as a “painted, moulded grey ware ceramic wall panel with geometric designs” and was purchased by the applicant in March 2010 for $HK1,650, being approximately $AUD235.  The item was offered for sale by the applicant at $3,600 (see paragraph [42] of Mr Bottaro’s affidavit; appendix 2, attachment O of Mr Chappel’s affidavit affirmed on 26 September 2011.)  There appears to be some confusion in the object’s description.  Dr Galloway’s report analyses two items: a “Painted tomb Panel” and a “Pottery Panel”.  Similarly, Mr Bottaro’s affidavit referred to the object as “Han Painted Tomb Panels” (see paragraph 9 of the statement of claim and paragraph [42] of Mr Bottaro’s affidavit).  Dr Chappell stated in his affidavit that the photos do not indicate that the object would consist of two separate panels (see page 5 of Dr Chappell’s affidavit).

   g)“Ifuagao Head Hunter Trophy Skull, Flanked by Pig Skulls” consisted of a human skull mounted on a rattan board flanked by the skulls of two pigs.  This was offered for sale by the applicant in its online gallery at $AUD4,900 (see appendix 2, attachment X of Mr Chappel’s affidavit affirmed on 26 September 2011).  The applicant purchased the object for $AUD1,500 (see paragraph [13] of Mr Bottaro’s affidavit).

Were the items part of the moveable cultural heritage of a foreign country?

1. A large number of the objects were, on the evidence of Professor Galloway, manufactured during the Han Dynasty in China.  This is consistent with the descriptions that the applicant gave on its website, and thermoluminescence testing obtained by the applicant prior to marketing the objects.  There appears no doubt that the following objects were made during the Han Dynasty and are objects of some degree of value:

   a)“Han Buried Stele” or “Pottery Stele”

   b)“Eastern Han dynasty bronze and pottery money tree”; and

   c)“Han dynasty ceramic wall panel” or “Painted Tomb Panel” or “Pottery Panel”

2. In addition an object manufactured during the Northern Qi Dynasty was similarly identified by the expert and is of some degree of value, namely the “Superb Northern Qi bull”.

3. The stone pillars which were seized were not manufactured before the twentieth century, or at the earliest the late nineteenth century, and were identified as replicas or fake objects.  As a result there is no question that they are not part of the cultural heritage of the People's Republic of China or any other country.

4. The Commonwealth maintained that the skulls formed part of the cultural heritage of the Philippines, and in particular the Ifuagao tribe.  The only expert called on this issue was Dr Oxenham, an expert in archaeology and biological anthropology at the Australian National University.  He examined the skull and compared it to others within collections and concluded that the skull was of north east/south east Asian or Polynesian ancestry. Initial analysis suggested that the skull was Japanese (north east Asia). 

5. Dr Oxenham did conclude that, "Based on the limited set of available measurements the unknown skull is not consistent with the Philippine male sample in the ForDisc database". He noted, however, that the database contained only 50 male skulls from the Philippines and that therefore this was not conclusive. He concluded that a comparison of the object with photographs of Ifuagao trophies from the Philippines "suggests it is consistent with being an Ifuagao headhunter trophy". However, he went on to specifically state, "Questions regarding the authenticity and cultural significance of this object, should in the first instance, be directed to Jeremy Barnes, director of the National Museum, Manila, Philippines" and gave the email address of Mr Barnes. He also hypothesised that "assuming the object is authentic ... it is possible that the human cranium belonged to an individual not born in the Philippines. There is anecdotal evidence that Japanese soldiers were targeted by headhunters in the central cordillera during WWII".

6. On the evidence of Dr Oxenham it does not appear that the respondent can establish on the balance of probabilities that the particular object was in fact an object of cultural significance in the Philippines given that he specifically referred the question of its authenticity and significance to an alternative expert, and identified that the skull appears more likely to be that of a person of Japanese rather than Philippines origin.  Whilst his evidence could not be suggested to have been to the effect that the object was inconsistent with the Ifuagao headhunter trophy board, it does not appear to go sufficiently far to allow the conclusion, on the balance of probabilities, that the object was in fact a headhunter's trophy board of the Ifuagao tribe.

7. As a result with respect to the columns and the Ifuagao skull trophy board the respondent has failed to establish that they are items of cultural significance. 

8. With respect to the Chinese items there are particular arguments raised with respect to the ceramic statute of a horse, which appears to have been an amalgam of a number of pieces of Han Dynasty era pottery, together with much more recent pottery.  Many of the other items have been repaired in more recent times, as outlined by Dr Galloway.  Dr Galloway acknowledged that there is no fixed rule for determining what is authentic and what is not.  The issue is difficult given that in many archaeological finds a vast number of items are smashed or broken and that archaeologists reconstruct items from the pieces that are located, often reconstructing a whole item from pieces from a number of separate original items. 

9. It appears that if a significant part of the object contains items from the Han Dynasty it is sufficient to conclude that the item is "authentic" for the purposes of its cultural significance.  In this regard I note that in many collections of museums items that are considered significant form only a part or a fraction of the whole not only with respect to objects d'art but also skeletal remains of animals and humans.

10. Each of the items other than the pillars and the skull trophy appear to me to fall within the broad ambit of the Australian law definition of the term moveable cultural heritage of the country in which they originated.

Export

1. In this case there is no question that each of the Chinese objects were bought in Hong Kong and shipped to Australia.  It is clear that at some point they have been exported from where they were located originally.

2. On the evidence I reject the proposition that they would have, on the balance of probabilities, ever been originally located in Hong Kong.

3. Dr Galloway expressed the view that although objects made in the Han Dynasty were traded from time to time however, given that these objects are largely funerary objects, which were tightly controlled by the society of the day, only a miniscule number of them would have been outside of the geographic area of the Han Dynasty. 

4. It appears that on the balance of probabilities the items originated within the geographic limits of the Han Dynasty (or the Northern Qi Dynasty with respect to the object from that era).

5. Unfortunately, no evidence was led as to the geographic limits of each of these dynasties, nor the relationship between the geographic limits of those dynasties and the modern day borders of the People's Republic of China.

6. When Dr Galloway was specifically asked as to whether or not the borders of the Han Dynasty were within the geographic area of today's People's Republic of China she stated that she was unable to say and would have to make inquiries in that regard.  No evidence was led as to this issue and, therefore, there is no material before the Court to show whether the items would most likely have been originally located within the borders of the People's Republic of China.

7. I have considered whether it is appropriate to draw an inference that at least a significant part of the geographic area of the Han Dynasty would be likely to have fallen within the geographic area of the People's Republic of China. However, what weight one could place upon that without specific evidence as to the geographic boundaries is difficult to determine. It is not a question upon which judicial notice should be taken in that it is not a question the answer to which is common knowledge (see Section 144 of the Evidence Act), as even the expert Dr Galloway was unable to say, when giving evidence.

8. In the circumstances the Commonwealth has not proved on the balance of probabilities that these items actually originated from within the geographic area of the People's Republic of China.

The law of China

1. In this case the Commonwealth sought to lead evidence from Professor Chappell as to the laws of China and the Philippines relevant to the issues in these proceedings.  Professor Chappell is an eminently qualified law professor with an outstanding curriculum vitae.  His primary area of expertise lies in criminology on which he has completed a doctorate at the University of Cambridge.  In more recent years his interest in criminology has brought him to the study of the trade of antiquities, a topic upon which he had written articles and attended conferences.  He has a particular interest in South East Asia.

2. However, it did not appear that he was an expert on the law of China or the law of the Philippines. He annexed copies of legislative provisions from those countries, but had never practised law in those countries, nor made the law of those countries a particular part of his studies. He does not speak Mandarin or Cantonese. Ordinarily foreign law is proved by evidence from the relevant expert which would usually be a legal practitioner in the relevant jurisdiction. Section 177 of the Evidence Act provides:

   177  [Certificates of expert evidence]

   (1)    Evidence of a person’s opinion may be adduced by tendering a certificate (expert certificate) signed by the person that:

   (a)    states the person’s name and address; and

   (b)    states that the person has specialised knowledge based on his or her training, study or experience, as specified in the certificate; and

   (c)    sets out an opinion that the person holds and that is expressed to be wholly or substantially based on that knowledge.  (emphasis added)

3. As a result I ruled that his evidence was not admissible as expert evidence on the terms of the laws of the foreign jurisdictions.

4. However, the Commonwealth also relied upon the printed copies of the legislative provisions from China and the Philippines as being admissible under section 174 of the Commonwealth Evidence Act which provides as follows:

   (1) Evidence of a statute, proclamation, treaty or act of state of a foreign country may be adduced in a proceeding by producing:

   (a) a book or pamphlet, containing the statute, proclamation, treaty or act of state, that purports to have been printed by the government or official printer of the country or by authority of the government or administration of the country; or

   (b) a book or other publication, containing the statute, proclamation, treaty or act of state, that appears to the Court to be a reliable source of information; or

   (c) a book or pamphlet that is or would be used in the Courts of the country to inform the Courts about, or to prove, the statute, proclamation, treaty or act of state; or

   (d) a copy of the statute, proclamation, treaty or act of state that is proved to be an examined copy.

   (2) A reference in this section to a statute of a foreign country includes a reference to a regulation or by-law of the country.

1. In this case provisions were provided that were printed from the Westlaw China database, and one of the government databases in Hong Kong. It is clear that they fall within the definition of relevant agencies or providers in section 174.

2. With respect to the Philippines it was sought to lead evidence of printouts from a legal database not known to Australian lawyers. Whether that particular database was objectively within section 174(2) would have been a matter for some evidence, however, none was provided. I note that in this regard the fact that there is an Internet database is not of itself sufficient to satisfy the test. Indeed, some of the descriptions on database printouts do little to give one confidence that the database would fall within the test. For example, a database contained ads for dating sites and a logo "practising law in a grand manner" (as one of the internet databases from the Philippines did).

3. Statutes were printed from the government websites in the Philippines with respect to the House of Representatives and the Supreme Court Library. These, it appears to me, fall within section 174(1)(b).

4. Similarly, I would have found that material printed from or indeed any of the legal information institutes in the group collected by WorldLII, provided sufficient confidence as to fall within section 174. Unfortunately, in this case the AsianLII website did not hold statutory material that the Commonwealth sought to rely upon.

5. In the absence of expert evidence as to the operation of the foreign laws I am left with the statutory provisions to interpret on their face as best I can.  Whilst foreign law is to be proved as a matter of fact, the application of that law once proved remains a matter for the court

6. However, as this case demonstrates, the bare terms of a foreign law will in many cases be insufficient to enable the court to make a determination as to the actual effect of the foreign law on the facts and circumstances of the specific case without expert evidence from a relevant legal practitioner or other expert.

7. The relevant provisions of the Chinese law are found in Law of the People's Republic of China on Protection of Cultural Relics (Order of the President No.76)

   Article 2 The State places under its protection the following cultural relics within the boundaries of the People's Republic of China:

   (1) sites of ancient culture, ancient tombs, ancient architectural structures, cave temples, stone carvings and murals that are of historical, artistic or scientific value;

   (2) important modern and contemporary historic sites, material objects and typical buildings that are related to major historical events, revolutionary movements or famous personalities and that are highly memorable or are of great significance for education or for the preservation of historical data;

   (3) valuable works of art and handicraft articles dating from various historical periods;

   (4) important documents dating from various historical periods, and manuscripts, books and materials, etc. that are of historical, artistic or scientific value; and

   (5) typical material objects reflecting the social system, social production or the life of various nationalities in different historical periods.  (emphasis added)

8. Article 3 categorises “movable cultural relics” into “valuable cultural relics” and “ordinary cultural relics” and “valuable cultural relics” is further divided into three different grades.

   …

   Movable cultural relics, such as important material objects, works of art, documents, manuscripts, books, materials, and typical material objects dating from various historical periods, shall be divided into valuable cultural relics and ordinary cultural relics; and the valuable cultural relics shall be subdivided into grade-one cultural relics, grade-two cultural relics and grade-three cultural relics.

9. Article 60 provides:

   No state-owned cultural relics, valuable cultural relics among the ones not owned by the State or other cultural relics that are prohibited from being taken out of China according to State regulations may be taken out of the country, except the ones to be taken out of the country for exhibition in accordance with the provisions of this Law or for special needs upon approval by the State Council.

10. In this case the purchase price of the objects in Hong Kong were each very modest.  The Hong Kong dollar is worth far less than the Australian dollar, making the purchase price of many of the objects miniscule.   The proposed sale prices and suggested valuations of the objects place them into a more significant category, although nonetheless they remain objects of relatively modest value.  Whether the objects were repaired or restored after they came to Hong Kong is not clear, however could also have affected their value.  Whether the current estimates are the values that would have been appropriate at the time of the export to Hong Kong, particularly if that was many years ago is without evidence.  For example, if one peruses the regulations to the Act the relevant values of objects covered by the Act when leaving Australia range from $5,000 to $250,000 (Part 5 of the Protection of Movable Cultural Heritage Regulations 1987).

11. When turning to the Chinese legislation and attempting to apply the provision that refers to "valuable" objects it is impossible without expert evidence to ascertain how the statutory law in China would be interpreted so as to apply in the specific case before me.  What is within the range of “valuable” as the term is interpreted by the Chinese authorities is not clear, particularly in cases involving items of modest value.  It is difficult to see that there would have been any real difficulty for the Commonwealth to obtain the evidence of a Chinese lawyer as to the operation of this Act, and its application to items of the modest value of those in this case.

12. It is not appropriate for me to speculate on this question.  The values of the items are not such that one could conclude on the balance of probabilities that they would be considered "valuable" for the purpose of the Chinese laws with respect to export restrictions, particularly if the restorations or repairs were done after they left China.

13. In the circumstances I am not able to be satisfied on the balance of probabilities that they were prohibited from export from China.

14. The relevant provisions of the law of Philippines are found in Republic Act 4846, also known as the Cultural Properties Preservation and Protection Act.  Section 2 provides:

    It is hereby declared to be the policy of the state to preserve and protect the cultural properties of the nation and to safeguard their intrinsic value.

15. Section 3 sets out the definition of terms.

    Section 3. Definition of terms

    a. Cultural properties are old buildings, monuments, shrines, documents, and objects which may be classified as antiques, relics, or artefacts, landmarks, anthropological and historical sites, and specimens of natural history which are of cultural, historical, anthropological or scientific value and significance to the nation; such as physical, anthropological, archaeological and ethnographical materials, meteorites and tektites; historical objects and manuscripts; household and agricultural implements: decorative articles of personal adornment; works of art such as paintings, sculptures, carvings, jewellery, music, architecture, sketches, drawings, or illustrations in part or in whole; works of industrial and commercial art such as furniture, pottery, ceramics, wrought iron, gold, bronze, silver, wood, or other heraldic items, metals, coins, medals, badges, insignias, coat of arms, crests, flags, arms, and armor; vehicles or ships or boats in part or in whole.

    b. Cultural treasures are cultural properties which are segregated and designated as cultural treasures in accordance with the procedure provided for in Section seven of this Act.

    c. Antiques are cultural properties which are one hundred years or more in age or even less, but their production having ceased, they have, therefore, become or are becoming rare.

    d. Relics are cultural properties which, either as a whole or in fragments, are left behind after the destruction or decay of the rest of its parts and which are intimately associated with important beliefs, practices, customs and traditions, periods and personages.

    …

16. Section 6 provides:

    The Director is authorized to convene panels of experts, as often as the need for their services may arise, each to be composed of three competent men in the specialized fields of anthropology, natural sciences, history and archives, fine arts, philately and numismatics, and shrines and monuments, etc. Each panel shall, after careful study and deliberation, decide which among the cultural properties in their field of specialization shall be designated as cultural treasure.

17. Section 10 provides:

    It shall be unlawful to export or to cause to be taken out of the Philippines any of the cultural properties defined in Section three of this Act, without previous registration of the objects with the National Museum and a written permit from the Director of the National Museum: Provided, however, that in the granting or the withholding of the permit, the provisions of Section seven of this Act shall have been satisfied.

18. If the skull was a cultural treasure or relic it appears its export would have been prohibited by this legislation, if it left the Philippines after the Act commenced.

Export from China

1. In this case there is no evidence when the objects were exported from China.  This is important as the relevant laws for the People’s Republic of China are statute laws that were adopted at the 25th Meeting of the Standing Committee of the Fifth National People's Congress on November 19, 1982.  The Commonwealth sought to press an inference that as they were purchased in Hong Kong one could assume that they had recently come from China to Hong Kong, brought by traders.  Some support for this inference was available from the evidence of the Hong Kong buyer for the applicant who it appears has been scouring the 80 or so antique shops in Hollywood Road, Hong Kong, over the last 20 years, referring items to the applicant that the buyer thought may be of interest.

2. However, the buyer was of the view that he would look to older items and old stock as new stock tended to be overpriced.  There was some speculation by witnesses about traders having warehouses of old items.  There was no evidence as to whether antiques sold in Hong Kong are most likely to have been recently brought from China, a mixture of items brought from China and those contained in areas of Hong Kong, or items from elsewhere in Asia.  In the absence of this evidence it is not possible to set a date at which one could conclude on the balance of probabilities was the time that the items came from China.

3. On the very limited evidence available I am not persuaded on the balance of probabilities that the items crossed the Chinese border in the timeframe of the operation of the Chinese laws relied upon.

4. It was agreed that as Hong Kong is a “free port” there is no prohibition on export from Hong Kong.

Import into Australia

1. There is no question that each of the Chinese objects was imported into Australia.

2. With respect to the trophy skull, in the absence of evidence that it was in fact made or manufactured in another country, it is not clear that it was necessarily imported into Australia. However, in this case the heritage of the skull coupled with the unlikely scenario that a skull would be obtained within Australia to create such an item leads me to draw the inference on the balance of probabilities that the item must have been imported at some point into Australia.

3. Whether it came to Australia prior to the commencement of the Commonwealth Act or at some other time is not apparent from the material (for example, it could easily have returned with a war veteran after the second world war).

4. There is no evidence as to whether the skull was imported into Australia before or after the commencement of the Philippines’ legislation (whether that be when it was passed in 1966).

Conclusion

1. In the circumstances the Commonwealth has not established on the balance of probabilities that the items are liable to be forfeited pursuant to section 14 of the Act.

2. As there are no claims upon the items by persons other than the applicant, nor any other basis upon which it would not be appropriate for the applicant to have the items returned to it (such as other laws of the Commonwealth or states, or disputes or claims of ownership by others) it is appropriate to order that the Commonwealth return the items to the applicant.  It is reasonable to expect the Commonwealth to do so within 28 days, or in the event of an appeal, after the appeal is dismissed (noting that if an appeal is allowed the appeal court will have power to set aside these Orders).

I certify that the preceding seventy-five (75) paragraphs are a true copy of the reasons for judgment of Riethmuller FM

Date:  22 August 2012